63

15th April, 1926

CONFIDENTIAL

(Due to arrive Melbourne-15.5.26)

My dear P.M.,

Surely these last few years have seen more political treaties concluded than any ordinary fifty years. The German-Russian Treaty, now in course of negotiation, is causing some misgiving here and the utmost annoyance in France and Poland. [1] The renewal of the Polish-Roumanian Treaty a fortnight ago, with new and unknown clauses, caused some anxiety in Berlin. A month ago the abortive attempt at a French-Italian-Jugoslav Treaty intrigued everybody. Europe is becoming a spider's web of Treaties and agreements.

On the surface it looked as if the German-Russian Treaty was the immediate reply to the Polish-Roumanian Treaty, but it is not thought that this is so. However, it undoubtedly does mean another step towards the old balance of power in Europe. There is now almost a complete 'hook-up' of states in Europe. They are not completely segregated into two camps but they are quite discernibly grouped into three-the German-Austrian-Russian, the French-Pole-Little Entente, and the Italian-Greek-Balkan. The Treaty-making fever is all very anti-League and rather disturbing.

2. In conversation with Wellesley [2] (Deputy U.S. of S., Foreign Office) lately, he expresses great concern about the state of China. He specialises in Far Eastern matters and is the F.O.

expert on the subject. His fear is that the Chinese will wake up to the fact that, if it suits their book, they can turn all the foreigners out of China tomorrow and there will be no reprisals.

Great Britain, of course, has most to lose in this event.

The Japanese, he says, have changed their attitude towards China since the War. In place of their bullying attitude, which was so much in evidence during the War, they now try to ingratiate themselves with the Chinese and pose as China's champion as against the rest of the world. Wellesley thinks, however, that this is merely a change in tactics and that Japan's big idea is still the eventual reduction of China by some means or other, to a position of vassalage to Japan.

He regards the Japanese as basically untrustworthy and unscrupulous. If one had nothing else to go by, their attitude towards us during the War would be enough. They not only demanded a substantial quid pro quo for the very minor part that they took in the War, but when, in 1917, the Allies' fortunes were at a low ebb, they gave every sign of veering round to almost open sympathy with Germany.

He thinks that Japan gained a great diplomatic victory over America at the Washington Conference when Guam, America's only really good potential fleet base in the Western Pacific, was voluntarily allowed by America to come within the status quo area.

He then qualified this by saying that probably Japan won her victory at the Peace Conference when she got the mandate for the Marshall and Caroline Islands, which envelop Guam and, by providing potential submarine bases all round Guam, really make it of no great value as a fleet base.

However, he sees no trouble with Japan, as far ahead as one can see, as she has no incentive to make trouble and nothing to gain.

He vaguely fears, well on in the future, a possible German- Russian-Japanese alignment, but this at present is quite academic and there is really nothing to indicate even a tendency in this direction.

3. The C.I.D. hold that one of the major lessons of the War is the importance of the economic blockade. The C.I.D. 'Advisory Committee on Trading and Blockade in time of War' has been working on this subject now for two years. At your request, no less than nine copies of their first two Annual Reports are being sent to you by this mail, I imagine to assist the deliberations of your Interdepartmental Committee which is enquiring into this same subject in Australia. The second Annual Report is really a very secret document.

The Blockade Advisory Committee has had two specific problems put up to them-the economic blockades of Turkey and of Japan. They exercise their wits in applying to these specific countries the general principles that they have previously evolved.

4. I take it that you are becoming convinced that the Foreign Office should eventually deal more directly with the Dominions on questions of Foreign Affairs. You are contemplating accrediting the next High Commissioner to the Foreign Secretary as well as to the Dominions Secretary. The new High Commissioner will then talk direct to Chamberlain [3] instead of hearing about Foreign Affairs through the mouth of Amery. [4] But I take it that this does not mean that you wish to alter the official channel through which you now receive written and telegraphic information on Foreign Affairs.

The arguments in this regard, I think, are as follows:-

(1) For retaining the present channel through the Dominions Office.

There is a distinct advantage both to H.M.G. and to the Dominions for there to be one coordinating Department of H.M.G. through which all communications pass, whether on Foreign Affairs or on any other of the many sides of the business of Government.

Foreign Affairs merge into other affairs. Migration of foreigners to a Dominion is connected with shipping. The negotiation of a Trade Agreement between H.M.G. and a Foreign Government may well have a bearing on some aspect of Inter-Imperial Preferential Trade. One can anticipate some confusion if more than one Department of H.M.G. is charged with the duty of being the mouthpiece of H.M.G. and the watchful guardian of Dominion interests.

If both the F.O. and D.O. talk direct to the Dominions, then the responsibility is divided without it being possible to draw a strict dividing line. On some matters the Dominions will fall between two stools.

It is therefore an advantage to have a coordinating Department such as the Dominions Office.

Also, the Foreign Office knows nothing about the Dominions. There is a considerable historical background (and even current political background) connected with dealings between H.M.G. and the Dominions, with which only Dominions Office officials are familiar. Any division of the responsibility of communication with the Dominions would have to be accompanied by some at least of the Dominions Office officials being transferred to the Foreign Office.

There is very little time lost under the present system in the despatch of telegrams. In a crisis, a Dominions Office official could remain permanently in the F.O., by the side of the F.O.

official who compiles the situation telegrams for the Dominions, could look them over and initial them in the name of his Secretary of State and have them despatched at once.

There will be no difficulty in practice in a Dominions High Commissioner talking direct to the Foreign Secretary. The principle of accrediting the High Commissioner to the Foreign Secretary need make no difference to the channel for-official correspondence by despatch and wire.

Whenever and wherever it is possible for the Foreign Secretary to talk in person to accredited representatives of the Dominions, the Dominions Secretary has never raised the least objection, such as to P.M.s at Imperial Conferences, and to Dominion Delegates at Geneva.

(2) Against the present system and for a new direct channel between the Foreign Secretary and Dominion P.M.s.

The arguments are confined to stressing the saving of time and the benefit of the one office conducting negotiations with foreign and with 'partner' Governments.

The fewer the links in the chain of consultation means fewer people having to be 'briefed', greater flexibility and speed, and less chance of misunderstanding.

For the immediate future at least, I think the solution is to be found in closer liaison between the Foreign Office and the Dominions Office on Foreign Affairs.

There is still no one man or department in the Foreign Office whose whole time and responsibility is connected with seeing that the Dominions are fully informed on Foreign Affairs. It is still a part-time function of the News Department. They now realize themselves that this is a wrong and rather haphazard way of doing it and they are considering how best to cope with it.

I think that before October they will have evolved a small department to deal exclusively with serving the Dominions Office with information for the Dominions, which will be a step forward.

I think in addition there should be one full-time individual in the Dominions Office who concerns himself with keeping in intimate touch with the Foreign Office-a Dominions Office liaison officer on Foreign Affairs. At present there is no one in the Dominions Office who knows anything about Foreign Affairs or of League of Nations work; although it is an important function of the Dominions Office to pass on intelligently from the F.O. all information to the Dominions on these subjects. To my mind someone of the rank of Batterbee [5] should be continuously employed on such work, and, if necessary (and it would be necessary, as the D.O. Officials are overworked even now), another official appointed in his place. This Dominions Office 'Foreign Affairs Liaison Officer', by keeping in close and continuous touch with the Foreign Office, would ensure that the Dominions did not lack information on any aspect of Foreign Affairs or of the League, and would be the stimulating force to ask the F.O. to put up a draft telegram or despatch on any subject, or aspect of a subject, of particular interest from a Dominion point of view. At present such drafts arise, more or less spontaneously in the Foreign Office, but, as far as I know, there is no particular individual or department who could be regarded as responsible if some subject which was not of obvious interest to Dominions were to be overlooked.

Also this Dominions Office 'Foreign Affairs Liaison Officer' would be the obvious Dominions Office official to accompany Dominion Delegates to League Assemblies at Geneva.

5. You will remember that George Wilkins [6] is leading an American aeroplane expedition into Arctic regions. There have been previous American expeditions into the North Polar areas and each time there has been great nervousness on the part of the Canadians that the Americans will find new land between Canada and the North Pole and will claim it for America. As you may know, the Canadians claim that they own everything between about 60 West and about 141 West; and northwards to the Pole. Wilkins' expedition is causing them great concern, and quite a file of correspondence and cables has grown up in the Dominions Office on the subject. As long as Wilkins keeps to the west of the 141st meridian (the continuation northwards of the boundary between Alaska and Canada), he is out of the Canadian zone. Anyhow, the fact that Wilkins is an Australian has nothing to do with the matter-or with us, and there is nothing to be done about it.

6. With regard to your trip through America, I attach extract from a letter I have just received from my brother [7] in New York. It appeals to me as quite sound. His present plan is to leave New York about June and come to London. His subsequent plans are not yet made, but I think he will probably go out to Australia and take up a place in the country. It seems to me rather a pity as he could do a great deal more than that, but he has not yet happened on any job or calling that promises to interest him permanently.

7. With regard to the framework for some speeches to be delivered in America, I hope to get at least two speeches completed, and a number of miscellaneous notes compiled, ready to go to you by next week's mail, with more to follow later.

8. I met Rear Admiral Napier [8], your new First Naval Member, at lunch at Admiral Aubrey Smith's [9] yesterday. He is a big, upstanding fellow, very like General Glasgow [10] in appearance. A fine type and should do you well. He leaves by the 'Cathay' on May 21st.

9. Major Greene [11] has arrived. I am getting E. J. Harding [12] and Batterbee of the Dominions Office and Macnaghten [13], the active man of the Oversea Settlement Committee, to meet him at lunch in a few days' time.

10. An article in the 'New Statesman' of April 10th on 'Canada and Locarno' is worth reading. It is on the last page of my press cuttings from periodicals of this week.

11. The coal position swings in the balance at present. You will know the result before you get this letter.

12. There is a section of the Cabinet who are anxious to suppress the Russian Trading Company ('Arcos') in this country, or at any rate to cancel what really amounts to the diplomatic privileges of its members. The raid on the Communist Headquarters showed that Arcos was being used as a channel for the passage of funds for subversive purposes in this country, and they are known to be acting as a go-between between the Third International and the Coal miners in this present coal trouble. However, at present Sir Austen does not think it wise to make any move. [14]

13. Ritchie [15] leaves on 1st May on a very attractive-sounding trip to Denmark, Russia and probably Persia, which will take him about three months. I have taken him to the appropriate departments of the F.O. who have blessed him and provided him with introductions to H.M. Missions in the countries he is going to, but do not give any written guarantee of his safe return. The head of the Northern Department remarked that he appeared to have a good thumb for a thumbscrew.

14. I would be glad if you would regard the Imperial Conference Agenda Committee's Report that I sent you last week as confidential to yourself. Hankey [16] gave me no authority to send it and then, after I had sent it, decided that it was best for it not to go. However, I told him it had gone and there are no bones broken. When the Cabinet considered it they decided to eliminate some subjects on the agenda, which they do not wish to have raised.

15. As you know, I now send you weekly copies of the Press Summaries prepared by the Press Attaches at H.M. Embassies in Berlin, Rome, Brussels and Belgrade, together with copies of the weekly letter from Sir Charles Mendl (Press Attache in Paris) to Tyrrell. [17] It means a great deal of extra typing in this office, but I think it is well worth it, as you get a concise picture of everything of importance that has seen the light of day in the press of these countries.

It occurs to me that in these press summaries you have a ready- made series of educational memoranda that might well be made available to the Australian Press, either in the form in which I send them, or modified by Henderson. [18] I have asked Sir Arthur Willett (Head of News Department, F.O.) and he sees no objection to them being made available to the Press in Australia, provided the source is not indicated. They would have to be looked through by Henderson to see that they do not contain (as they very occasionally do) any expressions of personal or Embassy opinion by the Press Attache who compiled them.

The news, of course, will be six weeks old by the time you get it.

But the tone taken by the press of these countries with regard to any international incidents, and their general attitude towards their neighbours, would, I should think, be of interest to the major papers in the Australian capital cities.

If you think well of the idea, there is no further authority needed from this end for you to put it into operation. It might help to lay the complaint that no more international news is made available to the Australian public now than two years ago.

Taking the idea a little further, I could cable you extracts of interest from these press summaries each week, either in clear or in code. The amount that I would send you would be limited only by the money you thought it desirable to spend on it. If you thought that 250 words a week would be of value, it would cost 6.5s.0d.

in clear or about 3.10s.0d. or 4.0s.0d. in code. This would not mean much additional work in this office and I could cope with it without much trouble.

I am, Yours sincerely, R. G. CASEY

1 The Treaty of Berlin of 24 April 1926 reaffirmed the Treaty of Rapallo of 1922 whereby Germany and the Soviet Union, both defeated powers, had broken their diplomatic isolation. Now, of course, Germany was a Locarno power and was soon to become a League member. The two countries had little in common except hostility towards Poland but Germany was still concerned to prevent other obligations (for example, League membership) forcing her into conflict with the Soviet Union.

2 Victor Wellesley. Created K.C.M.G. in June 1926, he held this position until he retired in 1936.

3 Sir Austen Chamberlain, Foreign Secretary.

4 Leopold Amery, Secretary for the Colonies and for Dominion Affairs.

5 Harry Batterbee, Assistant Secretary at the Dominions Office.

6 Australian polar explorer.

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

8 Rear Admiral William Napier was appointed Chief of the Australian Naval Staff in 1926 in succession to Rear Admiral Percival Hall-Thompson. Bruce would have preferred a short-list from which the Australian Government could make a choice but on this occasion, at least, the appointment was virtually by Admiralty nomination.

9 Vice Admiral Aubrey Smith, British Naval representative at the League of Nations.

10 Maj Gen Senator Sir William Glasgow, Commonwealth Minister for Home and Territories 1926-27, Minister for Defence 1927-29.

11 See note 1 to Letter 62.

12 E. J. Harding, Assistant Under-Secretary at the Dominions Office.

13 T. C. Macnaghten, Principal Clerk at the Colonial Office.

14 On 12 May 1927 an estimated 200 police raided the offices of Arcos Ltd, a British company trading with the U.S.S.R., seeking a document believed improperly to be in the possession of an employee. Nothing of importance was found, but the Government, seeking to justify its actions, broke off diplomatic relations with the U.S.S.R. later in the month.

15 Alan Ritchie, Victorian grazier, educated at the Royal Naval College and at Cambridge.

16 Sir Maurice Hankey, Secretary to the Cabinet.

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

18 Dr Walter Henderson, Head of the External Affairs Branch.