Foreign Relations of the United States, 1964–1968, Volume XXVII, Mainland Southeast Asia; Regional Affairs

23. Memorandum From the Presidentʼs Special Assistant (Rostow) to President Johnson¹

Washington, May 31, 1967.

SUBJECT

• Your Meeting with Australian Prime Minister Holt²

Previous visits by Holt have well established in the public mind the warm and close relationships between our two countries. You may wish in this visit to emphasize our respective roles in Asia, bringing in the Manila Declaration and generally putting Viet-Nam in the context of an Asia that may be turning the corner.

The following topics are expected to arise in your discussions with Holt:

British East of Suez

Australian Position

The Australians strongly oppose any British decision now to withdraw completely by the mid-1970ʼs. They have been extremely cooperative in coordinating with us their approach in dealing with the British, as well as with Singapore ad Malaysia.

United States Position

You may wish to assure Holt of your intentions to inform Prime Minister Wilson³ in strongest terms:

• —that you see no supportable reason for a British decision at this time for total withdrawal by the mid-1970ʼs;
• —that such a decision, whether made public or not, would have serious consequences for stability in the area, for U.S. policy, and for British relations with the U.S. and its ANZUS partners;
• —that the U.S. does not intend to assume commitments previously assumed by the British.

Interest Equalization Tax

A separate detailed memorandum has been sent to you on this subject.⁴ Chief points in U.S. position are:

• —we cannot risk undercutting pending legislation designed to strengthen this tax program;
• —other nations previously refused exemption have problems more urgent than that of refunding debts;
• —we may have proposed an Export-Import Bank loan designed to meet as fully as possible Australian refinancing needs at reasonable interest costs;
• —we stand ready to explore this proposal further in the attempt to be as helpful as possible.

Viet-Nam Australian Military Commitment

The Prime Minister may discuss current thinking in the Cabinet regarding a further increase in Australian military support. The level of Australian forces in Viet-Nam is now nearing the projected 6,300.

We have been in close contact with the Australians regarding priorities for increased support and are ready to help coordinate any aspect of a decision to strengthen that support.

Future Seven Nations Summit Meeting

Prime Minister Holt recently sent you a letter suggesting another seven nations summit (Tab A).⁵ You may wish to point out the following factors bearing on the timing of such a meeting:

• —President Parkʼs inauguration July 1, and a special session of Congress in the Philippines ending about July 5, preclude any date previous to the middle of July;
• —by then the Vietnamese election campaign will be in full swing with Thieu and Ky both possibly being candidates;
• —an October or November date may be more promising;
• —a meeting at that time would strengthen and publicize the new Vietnamese government, and by then changes in the military situation and pacification program may give substantial cause for summit level consultation;
• —if the Vietnamese elections are successful, we might think of an October or November meeting, but we do not wish to be committed publicly this far ahead, with so many unknowns to be faced in the interim.

Australian Participation in East Asian Regional Affairs

You may wish to:

• —congratulate Holt on Australiaʼs increasing and constructive participation in regional affairs such as the Asian and Pacific Council (ASPAC), the Asian Development Bank, the Colombo Plan, and UN specialized agencies.

Kennedy Round

Holt is pleased with the successful conclusion of the Kennedy Round. He considers that the grains agreement is better than seemed possible. Bilateral Australian-U.S. negotiation concluded amicably but without agreement because of Australian unwillingness to make a significant offer to the U.S. on tobacco. Lacking this offer, the U.S. withdrew its offer on raw wool.

R & R for Australian and American Troops

Both governments are agreeable to the idea of U.S. troops being giving rest and recreation in Australia, and Australian troops in Hawaii. Specifics are yet to be worked out, but we see no real problems. I would ask for his opinion.

Call on You by Opposition Leader, Mr. Whitlam

Holt may recommend that you receive Whitlam, recently elected leader of the opposition Australian Labor Party, on the grounds that his moderate and practical foreign policy position will thereby be strengthened. A memo on this subject was recently sent you (Tab B).⁶

Walt

1. Source: Johnson Library, National Security File, Country File, Australia, Visits of Prime Minister Holt, June 12 and June 17–19, 1966. Secret. The Department of State sent the President a May 29 briefing memorandum for the Holt meeting. (Department of State, Central Files, POL 7 AUSTL) Read also sent Rostow a May 24 memorandum that reported on John J. McCloyʼs visit to Canberra and his discussions with Holt. According to this memorandum, Holt was most concerned with British withdrawals from Singapore and Malaysia and the failure of the United States to make exceptions to the equalization tax as applied to Australia. (Ibid.)
2. Johnson and Holt met for a private meeting from 12:01 to approximately 12:40 p.m. This private meeting took place after the White House welcoming ceremony and before a lunch with Holt, which lasted from 2 to 3:30 p.m. (Ibid., Presidentʼs Daily Diary) No other records of the Presidentʼs meetings with Holt have been found.
3. Wilson made an official visit to Washington on June 2.
4. Memorandum from Rostow to Johnson, May 31. (Johnson Library, National Security File, Country File, Australia, Visits of Prime Minister Holt, June 12 and June 17–19, 1966)
5. Not further identified.
6. Memorandum from Rostow to Johnson, May 26. (Johnson Library, National Security File, Country File, Australia, Vol. II, Memos, 1/66–7/67.