Canberra, 25 August 1950

In addition to Ministers the following were in attendance:

Sir F. Shedden, Secretary Dept of Defence

Mr A.S. Watt, Secretary Dept of External Affairs

Admiral Collins²

Lieut Gen Rowell³ Chiefs of Staff

Air Marshall Jones⁴

P.M. reported that he was disturbed by world events. Stalin is not contemplating a world war but is hoping to win without a f.⁵ war. He is using two methods but we are not to say anything because of a policy of make believe. The first method is to recognize that W. Europe, Mid East and UK are vital and that UK is stretched and France is hard put to raise forces. His plan is to disperse our forces. He has therefore promoted Korea so that he can attract democratic forces there–the more the better because he is not using his own forces.

[matter omitted]

This results in forces being left then in the places that matter and secondly in distorting the psychology of the democratic countries. If Australia is committed in Far East then it is harder to swing public opinion to the Middle East. The same is true of USA and Stalin is counting on this.

This doesn't mean that Korea can be ignored. Korea must be won. But we must decide the extent of our co–operation having in mind the overall strategic considerations. How can we match our liabilities with our assets. If we leave our liabilities to the Security Council our liabilities will be without limit. Our liabilities may perchance be limited by a veto by Russia and by Communist China if they get on to the Council.

[matter omitted]

We are pretending that Korea is a UN operation. But we would not be in it unless US were in, and we are in it because they are in it.

But for years we have made our military planning on a realistic basic–how do we co–ordinate with UK, US, NZ. What are our real dangers, what are our real friends. But on a political basic we have been pretending that everything is based on the UN.

Korea is the perfect basic example of this. MacArthur⁶ had been ordered to evacuate it. Even now if the Chinese Communists helped the N. Koreans we could not hold any part of Korea. But all of a sudden a political decision is made that this is aggression and Korea must be defended.

But the President's announcement about Korea also included an announcement about Formosa. There was inconsistency in this. Korea was based on UN aggression and the Charter, but Formosa but⁷ based on arguments of strategy. Formosa can't be brought within the scope of the Charter. The real question is–is this place strategically vital? MacArthur explained that Formosa is vital because its loss would effect a breach in the chain of island bases. Who ever controls Formosa can reduce the efficacy of the bases on either side. This view has been accepted in Washington.

We and the UK and NZ have a duty to make up our own minds on this question & MacArthur is willing to provide facilities for us to examine this on the spot.

[matter omitted]

We should present our views to Washington once we make up our minds and we should do this very quickly.

We ought to make up our minds and saying what are the spots which are vital and it is only in these spots that we will be committed. If we can learn out of this to adopt completely realistic policies then it will be worth while.

[matter omitted]

Admiral Collins

You have given a masterly summary of the position as we see it.

[matter omitted]

My belief is that Formosa is vital.

Lieut Gen Rowell

Agrees also with PMs account ... On Formosa I do not agree with US point of view.

Air Marshal Jones

Satellites may attack places which are vital to us. We may just let them go & we will eventually be forced out of Asia. Japan, Philippines and Malaya–not Formosa–are vital.

[NAA: A11099, 1/1]

1 Cabinet notes record the opinions of individual members of Cabinet, and are thus distinguished from Cabinet decisions. They are subject for release to a 50–year rule. In 1950, the notes were maintained by the Secretary of the Prime Minister's Department, Allen Brown

2 J.A. Collins, Chief of Naval Staff.

3 S.F. Rowell, Chief of General Staff.

4 George Jones, Chief of Air Staff.

5 The meaning of 'f.' is not clear; it possibly stands for 'full'.

6 General Douglas MacArthur, Commander–in–Chief of United Nations Forces in Korea.

7 The word 'but' should presumably read 'was'.