51

11th February, 1926

CONFIDENTIAL

(Due to arrive Melbourne-13.3.26)

My dear P.M.,

Many thanks for your handwritten letter from Frankston of January 1st which I was particularly glad to get. [1] I am very pleased that you think the appointment at this end has been useful and justified by results, and I much appreciate your generous remarks.

2. The Cabinet have not taken anything that directly affects us lately, except the Imperial Conference. Domestic matters altogether.

3. At yesterday's Cabinet, Chamberlain [2] made a statement to the effect that there was no political bargain made in connection with the Italian debt settlement. Rumours had been going about to the effect that H.M.G. had got some quid pro quo in return for the very easy terms allowed to Italy.

4. Hankey [3] tells me that he has been instrumental in squashing another suggestion to revive the idea of a Minister of Defence. He says that this and the Channel Tunnel are hardy annuals and he works hard to squash them whenever they raise their heads.

5. Hankey looks on the entry of Germany into the League and on to the Council with dismay. [4] He thinks it will make for unending disturbance within the League, although, of course, he does not suggest that it is anything but inevitable.

6. The question of increasing the number of permanent members on the League Council, that has been a dormant problem for so long, now appears to be about to come to a head. It will be difficult to avoid the issue at the extraordinary session of the Assembly in March, as the various claimant parties are pushing the matter. As you know, Spain, Poland and Brazil are the claimants.

To my mind there is everything to be said against increasing the numbers of the Council. The more second or third rate powers on the Council, the more the intrigue and bargaining and the greater difficulty to achieve unanimity.

The arguments in favour of Spain seem to me to be entirely sentimental-a one-time great colonising nation and the Mother- State of the many Spanish-speaking countries of the world. But after all, we live in today and Spain is nothing today. Dinner- table diplomacy says strange things that are better not repeated as to the motives that influence the sponsors of Spain's claim.

Poland's claims are based almost entirely on Germany's prospective seat on the Council. She affects to think she would be in a position of relative weakness in certain anticipated future arguments with Germany, were the latter a member of the Council and she not. Also Poland is thrust forward as the European spear- point at the U.S.S.R.-the European question mark, and so might be said to have some enhanced importance.

France naturally backs both Poland's and Spain's claims. As regards Poland, France has gone so far as to suggest that if Poland does not get a permanent seat, she will regard herself as representing Poland's interests on the Council, which is altogether against the spirit of the League. She backs Spain because Spain is always ready and willing to back her.

Brazil is a large and spacious country and the leading Portuguese- speaking state of South America, and so is supposed to represent South America's claim to a permanent seat in the halls of the mighty.

I understand that Chamberlain is ready to support the claims of both Spain and Poland. It is strongly rumoured that he has committed himself to this action with both countries, although this is hard to believe when he has not yet had Cabinet sanction.

The present permanent members of the Council are, of course, Great Britain, Japan, France and Italy, with Belgium, Brazil, Uruguay, Czechoslovakia, Sweden and Spain as non-permanent members.

The original scheme, as you will remember, was to have 5 permanent members (the present members plus U.S.) and 4 non-permanent members. In 1923 the non-permanent members were increased to the present 6.

The pros and cons of it all are numerous and mostly appear pettifogging. Everyone wants to be glorified by having a permanent seat, and no one wants to court unpopularity by standing out against them. Where is it going to end? The demands for seats, permanent and not-so-permanent, will not end where it is now. Will it stop at a total Council of 15? or 20? And then what about the Dominions? I have been told in conversation that it was admitted in principle at the Peace Conference that a British Dominion might be a member of the Council, as well as the British Empire. [5] I will check this up.

7. Italy seems to me to be a potential disturbing force in Europe.

No doubt the mainsprings of her restlessness are Mussolini's personality and her increasing population pressure. Mussolini's monstrous 'Peace in the Shadow of the Sword' speech of ten days ago, followed by his 'Tyrol minorities' speech, shows his lack of faith in the League and his belief in the possibility of a revival of European conflict. I think that this country has more influence with Italy than any other, because in reality we are the nearest approach to friends that she has got. All Italy's neighbours hate her-France, Germany, Austria, Yugoslavia. I cannot but think that if Mussolini turned words into deeds and started any buccaneering he would have the League down on him with a surprising unanimity.

The League of 1926 would seem to have more punch than the League of 1923 and another Corfu would not be popular.

8. I have, from my brother [6] in New York, a nice comment on Italian affairs-'When in Rome, do as Mussolini says'.

9. A few days ago there was a Group Meeting of the B.I.I.A. on Dominions and Foreign Policy, at which Holman [7] (N.S.W.) was present. As far as what was discussed went, nothing new came out of it; the same old ground was flogged over. However, as I sat in a corner and said nothing, it was brought home very clearly to me that Holman knew nothing at all of what had happened in Europe since the war and, in fact, nothing about the Imperial position generally. And Holman is, I take it, a man of considerable intelligence and much greater breadth of view and knowledge than 99 per cent of Australians generally. If he knew nothing of where Australia stood in the world and what the rest of the world was doing and thinking, then how abysmally ignorant must the rest of the population be. I don't say that Holman would not pick it all up very quickly, as I am quite sure he would.

Is there no channel whereby one can bring home to the general run of people in Australia some understanding of these subjects? Cannot Australian public opinion be informed and an interest awakened in something outside our own Australian shores? Could not some means of expounding the British case-and the Australian case- be evolved? Holman made the point that, in his opinion, there was practically no desire in Australia, except in a very limited intellectual circle and amongst a few extreme anti-British Labor politicians, to alter the pre-war position of Australia in the Empire. He thinks that as long as the people have their vanity tickled a little from time to time with regard to their autonomous status, they are quite willing to let the foreign affairs of the Empire be conducted by H.M.G. He emphasises the characteristic of Australians to do the right and decent thing, as long as the reason for it is made clear to them, and one does not attempt to dragoon them. Tell them, he says, the difficulties that Great Britain is up against in Europe and the virtual impossibility of anything like effective consultation in an emergency, and they will respond sympathetically and back up the Home Government without question when called upon.

Whilst I think the above is an under-statement, it does bring out the divergent tracks that Canada and Australia are pursuing in Imperial matters.

10. I talked over with E. J. Harding [8] (Dominions Office) the Irish Free State debate of 5th February, when Desmond Fitzgerald, their Foreign Minister, tried to make a too clever distinction between the British Empire and the British Commonwealth of Nations. He implied that the I.F.S. belonged to the British Commonwealth of Nations but had nothing to do with the British Empire, which included the Colonies and Dependencies. Harding said that this devil's argument was not new-that it had been made by the I.F.S. before and that their error had been pointed out to them.

I asked him how he managed to maintain patience with such manoeuvres and produce a soft diplomatic answer each time. He said, confidentially, that it was extremely difficult at times but that they found it paid handsomely not to lose one's temper nor to give a sharp reply. He said that a living evidence of the success of their nursing methods was shown in the attitude of Hertzog [9], who had been very recalcitrant and trying in his attitude towards this country when he first came into power, but that, Harding thought, due to their correct and painstaking attitude, Hertzog's attitude had improved immensely and he was now infinitely more reasonable to deal with.

11. Poliakoff [10] (Diplomatic Correspondent of the 'Times') is an interesting character. I have frequently spoken of him in my letters. A Russian engineer of very considerable ability who got out of Russia intact, did hack journalism on the 'Daily Telegraph' for a bit and eventually got to his present reasonably important post. Particularly unprepossessing in appearance-rather like Rasputin without the beard!-and with an active and intriguing mind. He is a personal friend of Berthelot [11], the permanent head of the French Foreign Office and is reputed to get a lot of information from him. I make a point of giving him food and drink once a month, at which he tells me his schemes for the rectification of Europe. I always tell him that one Poliakoff may make the 'Times', but two Poliakoffs would make a war. A few weeks ago, I asked him why, in the name of common sense, he expected that Berthelot would tell him anything other than what he wanted to be known in England. After some diffidence (which is rare with him!) he said that Berthelot probably recognised that he (Poliakof) had a constructive mind and that in the to and fro of intelligent conversation, both sides gained! Lacking in modesty but probably true.

You will find Poliakoff frequently quoted by Mendl [12] in his weekly letters to Tyrrell [13], which I have got into the habit of sending out to you. He keeps on the side of the angels by dropping in at our Embassy in Paris after seeing Berthelot and telling them the gist of his conversations.

A few weeks ago Poliakoff unfolded to me his Machiavellian theory about the future of the North American continent. He said that he was convinced that eventually the U.S. would have to use force in Mexico and that, in his opinion, the sooner the better. When it happened, Canada would wake up to the realisation that what had happened to Mexico might some day happen to her, and that she would thereby be thrown back into the Empire with a rush! He was wise enough to think that this might not happen for 25 years. I think this theory shows, as well as most, the quality of his mind.

12. Whilst staying with some people for a recent week-end, they produced a sackful of old parchment documents, Indentures, Deeds of Settlement, etc., that had accumulated in the old house, dated from 1625 onwards. Some in Latin but mostly in very badly spelled English. The Elizabethan documents described her, amongst other titles, as Queen of France. They were all quite legible and the ink still black and clear cut, although the style of writing was quaint.

I mentioned this to Headlam-Morley [14], the Historical Adviser of the F.O. His comment was that people did not realise how different our present day records are in lasting power. He says the ordinary typewritten carbon copy becomes very faint in ten years and practically illegible in 20. The original typewritten sheet lasts longer but even this has a definitely limited life. In the F.O.

anything of any importance is printed, which does ensure a long life.

13. Colonel House's [15] Memoirs are appearing in the 'Daily Telegraph' in serial form. From the few that have already appeared, I think they are well worth reading. I will send it out to you as soon as it appears in book form.

14. Lord Burnham [16] made a speech of weight on Australia at the Royal Colonial Institute a few days ago, of which I am able to send you an uncorrected proof copy with this letter.

15. There have been no further developments regarding the L. of N.

Economic Conference (see my LON. 232). It is expected that the date of convening of the expert commission will be decided at the March Council. It will probably be April 15th, I believe. The papers in this country are beginning to wake up and wonder how it will affect Great Britain. [17]

16. Waterlow [18], late Head of the Far Eastern Department, is about to be posted to Siam as Minister!

With best wishes, I am, Yours sincerely,

R. G. CASEY

1 While holidaying at Frankston near Melbourne Bruce had written to Casey congratulating him on his performance in London, urging him to 'amplify rather than reduce the private letters you write to me' and asking him not to be concerned that many letters went unanswered. The letter, dated 1 January 1926, is on file AA:A1420.

2 Sir Austen Chamberlain, Foreign Secretary.

3 Sir Maurice Hankey, Secretary to the Cabinet.

4 After an anti-climactic Assembly session specialty convened in March 1926 to deal with German entry, Germany finally was admitted to the League of Nations in September 1926. The delay sprang not from opposition to Germany's admission but to problems posed by other states (Poland, Spain, Brazil, Belgium and China) lobbying to join Germany on the League Council.

5 At the request of Canada's chief delegate, Sir Robert Borden, Clemenceau, Wilson and Lloyd George on 6 May 1919 in Paris signed a memorandum that 'the self-governing Dominions of the British Empire may be selected or named as members of the Council'.

6 Dermot Casey, private secretary to Sir James Elder, Australian Commissioner in the United States.

7 W. A. Holman, Premier of New South Wales 1913-16 (Labor) and 1916-20 (Nationalist).

8 Assistant Under-Secretary at the Dominions Office.

9 General James Hertzog, South African Prime Minister 1924-39.

10 Vladimir Poliakoff.

11 Philippe Berthelot.

12 Sir Charles Mendl, Press Attache at the Embassy in Paris.

13 Sir William Tyrrell, Permanent Under-Secretary at the Foreign Office.

14 J. W (later Sir James) Headlam-Morley.

15 Colonel Edward House had been a close adviser to U.S. President Woodrow Wilson.

16 President of the Empire Press Union and proprietor of the Daily Telegraph.

17 With an eye especially to questions of productivity and free flow of trade, the League Assembly in 1925 called for a general economic conference. After very thorough preparation the World Economic Conference of experts chosen by fifty governments met in May 1927. The principal outcome was a strong call for the removal of tariff, quota and other obstacles to free international trade.

For perhaps two years, many States showed an inclination to respond to the conference's recommendations, but economic nationalism remained strong, especially in the United States and, of course, the Great Depression radically changed the international economic environment.

18 Sydney Waterlow, Minister to Siam 1926-28.