1. Your No. 825 [1] relative to your discussion with President has
been read with interest.

2. While it is realised that a strict treaty in regard to security
in the Pacific may be difficult, it is suggested that an informal
statement of policy would need to be supplemented at least by
staff conversations and the preparation of a plan. This is
fundamental to a sound defence policy and a basis for defence
preparations. In actual fact, it would be a regional arrangement
in accordance with Article 52 of the charter. You will recall
that, prior to the outbreak of the war with Japan, staff
conversations with the United States were proceeding with a
similar objective in view.

3. In regard to your discussions at the State Department, I agree
that the use of bases by the United States forces should not be
confined to Manus alone provided there is reciprocity on the part
of the United States. It is not known whether the expression
'Australian Services' has been used with special significance. You
will recall that in London we established a common viewpoint with
the United Kingdom and New Zealand on this matter, and it is
considered that American facilities should be available to British
Commonwealth forces. In a British Commonwealth plan for co-
operation in Defence in the Pacific, it might be essential that
forces from the United Kingdom or New Zealand, and particularly
United Kingdom Naval forces, should have these facilities equally
available for their use.

4. As stated in London and mentioned by you, we would have to
consider carefully the additional financial responsibilities
involved in the policy that we are advocating.

5. I hope you will be able to advance this matter to a point that
will enable some established basis to be agreed, even though it
may only be a starting point leading to a course in the right
direction. It is realised that progress would necessarily be slow
and can only probably be carried out on the highest Governmental
level. There is a tendency here in press comments to suggest that
the Americans should be allowed into Manus on their own terms,
lest they should withdraw from the southwest Pacific altogether. I
gather from your report that the door to discussions is still
quite open. As stated in my report to Parliament on the London
Conference, Australia's part in the war, with its manpower and
material resources, demonstrated the importance of the
Commonwealth as a strategic base for the maintenance of security
in the Southwest Pacific. I should not think that it is in the
interests of American defence for important strategical
considerations affecting its security to be ignored.

CHIFLEY