PM Transcripts

Transcripts from the Prime Ministers of Australia

Transcript 1362


Photo of Holt, Harold

Holt, Harold

Period of Service: 26/01/1966 to 19/12/1967

More information about Holt, Harold on The National Archive website.

Release Date: 18/07/1966

Release Type: Speech

Transcript ID: 1362

Mr. Chairman, Your Excellencies, Ladies and Gentlemen:
It doesn't seem so very long ago that I was talking to
another National Press Club, in Washington, and I w-as able to say
to that gathering that an invitation to speak to the National Press
Club in ' ashington had become a sort of status symibol in the life
of the potential statesman. I think the way you are shaping, Ir,
Chairman, the Canberra National Press Club can claim that sort of
prestige for its functions and I wish you success in the development
of an institution which has added, significantly I believe, to the
value of attending Canberra gatherings by those who have come to be
named amongst the world's most notable.
You had very recently one of the great men of contemporary
times in Dean Rusk I happened to be in New York at the time and
you were being noted with so much significance that a fe: w entlemen
holding up a piece of calico by way of protest to hr. Rusk s
presence found themiselves honoured by front-page treatment in the
" New York Times", but I doubt whether anything I say here today
will be similarly publicised there, but at least the National Press
Club here in Canberra has been noted in this way in one of the
most august papers of the United States.
Nci I don't know that I clearly apprehend how I should go
about this business this afternoon because there was such a
comprehensive cover in the Australian press of everything I did
while I was overseas that it would be a waste of your time to go
over the ground in a narrative way again. It is one of the
significant development of modern times that a public figure in a
position of leadership going abroad does have a coverage,
particularly from his native press and the other communications
media of television and radio, surpassing anything that we have
ever known in the past, and in a sense this is a good thing since
the workings of a democracy require an understanding in some
detail of what it is the head of that democracy is putting publicly
at any particular time. But I would like you to know what this
adds up to in demands upon the itinerant statesman. If, at every
airport his plane touches down, even if only to refuel, he finds
himself met with a battery of television, radio, and newspaper
representatives, then by the time he reaches the country of
destination much of what he wanted to say has been dissipated
along the route. There is always the alternative of turning
rather rudely away from the complicated apparatus that people have
brought at considerable inconvenience and expense to greet him,
but that is not a very popular alternative, and so one usually
obliges by making some comment which the doctors have advised is
not well-considered within 24 hours of a jet journey. Perhaps
that is why so many foolish things are said at airport interviews.
The other thing is that accompanying you these days is a
team of pressmen. In my case I had the comforting presence of
radio and television representatives as well, and the result is
that back home my own people got very full treatment. They
have all heard what I have been saying and doing. They have
read so many accounts of the same sort of general proposition
that some must have wondered why I have been talking so much,
but in point of fact it is necessary to thump your way as hard
as you can to make the slightest dint in the press of the country
in which you are appearing, and I think it is as well for our own

poeple to mkno that. Although . we feel that in some of the
significant areas of policy making and with some of the leaders
of policy around the world, Australia is able to exercise an
influence, the space we occupy in the national press of the
countries concerned is unflattering to our egcs and this must
be accented as one of the facts of contemporary political life.
So don't be surprised if in the course of a journey such as I
have just made you find your spokesman saying apparently over
and over again the sort of thing that you read a week before.
To make his point, to register the argument, w. ith the press and
the public of the country he is visiting these things have to be
done. Well, I think that b' dint of diligence and persistance
on this occasion the points that I desired to make were registeeod
at least in quarters where they will have some impact, and I will
say a wor or two about that as I go along.
. y prime purpose, as you know, w-as to establish closer
working relations with the Prime Lnister of the United Kingdom
and with the President of the United States of America. Both of
them independently of each other had proposed to me that I should
visit then for this purpose. Both of them, independently of
each other, had proposed to me when I took office that I continue
with them the same intimate co; mmunication by way of correspondence
and cable that my predecessor, Sir Robert Inenzies, had conducted,
and this itself is a reflection of the growing place which
Australia occupies in the affairs of the world at this time, or
at least in this area of the w, orld in which we find ourselves.
For my part I w; as very glad to receive these invitations,
believing that it would be nationally advantgeous if I could
develop closer working relationships.
In the result that aspect of the journey turned out far
better than in my most optimistic moments I could have hoped.
Hy visit to President Johnson, as first log of the journey,
proved -: arm, cordial and laid the foundation for the closer
discussions which took place on the second visit, but there were
some valuable discoveries to be made from the first and as these
items have not previously been commented on publicly by me,
I mention them now.
The first was the welcome discovery of how fit and
buoyant the President looks. I had imgined that, having come
through an operation of a serious kind quite recently, and
noting as I had before in the case of President Eisenhower that
the newspaper photographs seemed to take a lot of the blood out
of tho subject, it was encouraging to find in charge of the
affairs of that great democracy this live, vigorous man. Not
only w. as he fit and alert, right on top of his ow-n particular
responsibilities, but that morning he had sat up until 4 o'clock
w'aiting for the reports which had come from the oil installation
bombing operations. I could hardly have tined my visit better
because he lwas anxious to know the results of the bombing and
also to hear the reactions around the world. Je had been
consulted beforehand, we had made known beforehand that in our
view this was a -icgitimate exercise of military tactics, but
it was fortuitous that T happened to be in Washington just on
the morning w-hen the new. s broke, and Wvhat I was able to say
then in support of that decision was welcomed widely by all in
the Administration and by many people throughout the United
States generally.

But one matter I think I shoul. d put quite finrly on the
record. It is important that this should be Imade w. idely known.
There may be doubts around the world, certainly I believe these
doubts exist in the Cormunist w. orld, aboub the strength of
resolution of the President of the United States and leading
members of his Administration in their detclrination to see the
issue through in South Viet Nam. I have no doubtin my mind,
I say that not merely because he made this clear in emphatic
terms to me, but because of my own assessment of the man and of
the very able team of men he has around him. You saw one of
them in the person of Dean Rusk here quite recently. I repeat
I have no doubt in my own mind of the strenth of the President's
resolution, his determination to see this strugle through.
Now I say it is important that this should be known
because those who lead the Commui-' nist forces are not familiar, or
seem to be unfamiliar with our methods of government. To them
it would be unthinkable in their own country that a government
should find itself faced with the hostile voices that one hears
in a democracy without taking some action to supress those voices.
They find leading figures in American life, academic leaders and
others, critical as we find them in our own country. This
influences their own thinking. It becomes a subject matter for
the propaganda material which they subsequently prepare and
consequently it becomes important for us to stress publicly the
belief, if belief exists, and in my case it is the strong belief,
that the President, backed by the capable men he has around him,
is determined to fight on in South Viet Nam until a peace which
meets our concepts of justice and fair dealing and effectiveness
can be procured in that country.
I saw. in one press editorial this morning a query as to
whether there was any substance in the suggestion that the
Americans were determined to go ahead and secure a military
victory before any negotiations would be entertained. Well, as
recently as the time of the release of the communique by the
President and myself, in Washington, it was made clear that
negotiations would be welcomed at any time, and the sooner the
better. We both commended the efforts, negative though they
have since proved to be, of the Prime tinister of India, in seeking
to promote negotiations as early as practicable.
And so we are fortunate, I believe, those of us who are
held secore by the strength, the military might, the free world
leaderh. ip of the United States, we are fortunate that there
should be in that leadership at this time a man of the resolution,
the clarity of vision, and the will to see this thing through
with a view to producing a better world order in that area, in
the person of the President of the United States. Don't let's
overlook the fact that it is not the decision merely of President
Johnson that has been given effect in South Viet Nan. There is
a disposition to think that this is a product of the will and
judment of this one particular Presidential figure in point
of fact he is the third President in succession .' ho has felt that
free world interests and the proper policies for the United States
require an American participation in strength in this area. For
our part, we in this country have the authority of two successive
Prime iinisters backing the judgrcnts of those three Presidents.

In the United Kingdom I had talks which were just as close
and just as cordial with Mr. Iarold iilson. It's rather
unfortunate that not so much pro-: inence has been given to these
talks because they formed for no a basis for continuing
collaboration with him in a most cordial fashion, and, no less
than in the case with President Johnson, I was able to build a
personal relationship with him. ' We spent together one night at
Chequers, the historical residence of Prime Ministers of Great
Britain. We had 3 hours alone in which we canvassed all the
problems I had put down on a sheet of notpaper, matters which
I wanted to raise with him. Later that night I ticked off each
item, in case it proved necessary to follow up next day in the
course of further discussion we had arranged some matters which
had been overlooked. I found that we had covered the whole
field, and although there are differences of viewpoint which
I think have become well identified between the United Kingdom,
the United States and ourselves I for one as a parliamentarian
who has had to work both with a majority of one and with a
majority very much larger than that, don't underrate the political
problems . which Mr. Wilson has to contend with.
Knowing those political problems, the President feels, and
I certainly feel that 1r. Wilson has shown great courage and
firmness in holding his government in support of our presence in
South Viet Nam and in support of the objectives we have there.
I mentioned this to the President and at the same time talked
about concern at what seemed to be a lack of substantial interest,
and even more so on the Continent of Europe, in what is going on
in this area of the world. One has only to pick up the papers
and scan through them each morning to see how little space is
given to events in this area of the world, outside of the day to
day military reporting in Viet Nam itself. And the fact of the
matter is and who are we to be critical of it because I suppose
we don't take all that much interest ourselves in what is going on
in some of the countries of Europe that the people of Europe,
and this goes for the mass of people in Great Britain also, regard
these countries as remote and relatively unknown and thus
possessing no great or direct significance in their eyes.
I happened to arrive about the same time, in fact a day or
so after the French Prime Minister, and great prominence was
given to all that he said and did while he was there. From the
more significant papers, such as " The Times" and one or two
others, we had quite a good press cover of what I was putting,
but clearly the mass of people did not have this interest and if
the mass of people don't have the interest then the Parliament
tends to reflect that attitude of mind and these days Great
Britain, the countries of Western Europe, tend to be inward
looking into their own affairs rather than outward looking in a
way which would embrace the problems of areas asremote as ours.
Well this, from our point of view, may be unfortunate, but
if it exists then it is important that we should know about it
and we should adjust ourselves accordingly. And I come back to
this country with a more balanced assessment, I believe, of the
relative strength of feeling about the future of the area and
this must have its effect on policies as they emerge from time
to time.

In the United States it seemed to me that there was very
vivid reporting and a. groat deal of it of the actual fighting
and events relating to military ocprations in South Viet iNai.
But, again, one found a quite noticeable lack of public reference
to the more positive developments occuring around the South East
Asian area. Now these are not drar. tic in a new. sense, and,
taken, isolated one from the other, perhaps don't seem to amount
to a very great deal. But to those of us who have been dealing
closely with these things over the years, wo feel a great hope
from developments which are now taking firmer shape, which do
evidence a growing co-operation, particularly amongst those
countries of the area -ho have felt thensolves threatened by
Colmunist subversion or attack, or feel the potential danger
which could develop as a result of CoInunist penetration if
country after country were to fall.
And so wo have seen an organisation such as the Asian and
South Pacific Council eecrge with 9 countries, of w: hich Australia
and New Zealand are two not a great power country amongst them
other than that Japan must be considered a great power in an
industrial sense, but in a ilitary sense, not a great pow. er
amongst them. But all of them feeling unity of purpose or danger
from the fact that they are on the periphery of Asia or in
sufficiently close contact to the events in South Viet Na. and in
China, to believe that unless there is a chock to that aggression
then they could be endangered in the future.
We have seen over recent years the way in which countries
formerly threatened, like South Korea, Taiwan and Ialaysia, have
been able to strengthen their economies and to build up their
resources shielded by the strength of the United States and its
establishments throughout this area of the world. And so I made
a point wherever I could of ephasising this and it was heartening
to find that the theme had attracted the interest and enthusiasm
of the President and his Administration. I don't claim that there
was novelty in the matters that I was putting forward, and indeed
Australia has always mi ntained an initiative in this field. You
may remember that Lord Casey, as Iinister for External Affairs, was
one of the very few linisters of Foreign Affairs of any country
outside of Asia directly, who went around those countries and
made our viewpoint known clearly, built up good personal relations.
There was the pioneering work of Sir Percy Spender with the Colobo
Plan. The work then followed up by Sir Garfield Barwick and,
more recently, my colleague Mr. Hasluck.
Therefore, it is not by accident or by geography that
Australia does possess a very warm, friendly and close -: working
relationship with so kmany of these countries. even have a
friendly basis with countries which don't enjoy that same kind of
relationship with very many in the area. For example, we have
very good relations with Cambodia and indeed, represent United
States interest in Cambodia.
Right through the period of confrontation, we nevertheless
managed to maintain a channel of friendship through to Indonesia.
1Vith Thailand, there was the exchange of visits between
the Prime M. inistcr and myself, he visiting Australia first this
year. In the course of my own visit later to South East Asia,
I was able to develop a still closer relationship with him.
These are just syrptoms of the times. The emergence of an
institution like the Asian Development Bank; the arrangements
we are making together for the developnent of the kekong Valley;
the grant by Japan of 800 million dollars of credit to South
Korea as part of the close economic and trade relationships with
that country. These, I repeat, are only sympto but we're

dealing wit more than half the numan race East of Suos and with
a population growth rate higher than almost any other country or
area in the world.
By the end of this century that billion and a half of
people may very well have doubled, and in this area the United
States has expressed its determination to join in developing the
resources of this new Asia, in joining in co-operation with
others in order to make more effective use of their own resources
to provide a ray of hope for a better way of life for the people
of these countries. Evidence of this has been quite dramatically
provided for us in the course of the past foe days by the President
of the United States.
Now this was a theme which was expressed quite vigorously
by me and before I had left America and, indeed, by the time
I wont back again for a second visit, had become well taken up by
the Administration and had formed the material for a lot of
approving editorial comment throughout some of the leading
journals of the United States. And I regard this as being just
at the beginning of our activities in this field. Australia and
Japan have given a notable demonstration of what can be achieved
in our friendly trade one with the other. It has multiplied four
and a half times since the early 1950' s and, we believe, we are
just at the beginning of this process.
Now somebody asked I think you, Mr. Chairman, in
introducing me, how far did " All the Way" mean in relation to
the President. I only hope that those who'vc given currency in
this country to the phrase have studied as closely all the other
things that I said while I was there. They would then have
developed a well balanced appreciation of what it was I was
trying to express. It doesn't mean, certainly, that Australia
has any lack of independence of mind, and anybody who knows the
President would be paying him no compliment if they felt that he
was looking for the kind of friend who was never prepared to
have an argument with him. He has a vigorous mind of his own
and he looks for a vigorous exchange of views from those who
invoke friendship with him.
Quite shortly after seeing him in Washington I put some
views in New York to the American-Australian Association which
certainly didn't coincide with Administration policy of the
momeht. I spoke of the need to penetrate both the iron and the
Bamboo Curtains to build up trade as a means of opening up
personal contacts, personal relationships, to have more
frequent visits by reporters, by scientific and cultural groups
and in these and other ways help to establish a human quotient
which would assist in breaking down these resistances. The
phrase I used then I think is worth repeating, not because of
its excellence, but because it does express a concept that I'm
sure all here would adopt. We can't afford to look on the rest
of the world in terms of the " goodies" and the " baddies",
contending that all the right people, the good people, are on
our side, and all the " baddies on the other in the Communist
camp. There are intelligent people, dedicated people, working
for their own national interest in all communities around the
world. For our part, it is for us to -see where those who are
willing to look for a better world can come together in some
settlement arising out of present differences, and apply the
tremendous resources that men are capable of now attaining, to
the betterment of mankind for the better world to which we all
aspire. In the President, we have a practical rnn who is, at
the same time, a man with vision of a better world whether it is
the society that he works for in his own country, or for an

application of the fruits of science and technology to the needs
of the rapidly increasing human race.
Now, out of these discussions, I feel that a basis has
been established in which Australia can play a useful part in the
future. Adopting the old Aesop Fable oi the Lion and the ' i~ uso,
I said-that " Little friends can prove great friends' and Australia
is so placed geographically and in terms of the relationships we
have built up with the countries of Asia, that 0e can, I believe,
serve in a useful way both with the United Kingdom and with the
United States in doing more in this area of the world. The
United Kingdom is conscious of the limitations upon its own
capacities. " Overstrtcdh" was the wori which seemed to signify
the situation in that country. It was put to me by members of
the Government itself. They'. re very conscious of their cormitments
at a time w-hen their resources are not adequate to meet the
extent of the commitments they have undertaken. They have to
bring themselves into a better state of balance. But with the
United States, the position is rather different. If only a
situation of peace and stability could be restored in South East
Asia, then the vast resources that are currently going into
military purposes could, with advantage, be turned to the tasks
of reconstruction and development of areas possessing so much
potential in themselves.
Now, I believe that Australia as a result of all those
talks, finds itself in a position where both the United States
and the United Kingc. om look to us as a country of influence, a
country capable of playing a significant part in the future of
the area. I can say, without any reservation, that no
additional commitments have been sought of this country. These
matters did not arise in discussion between us. I think, both
in the United States and in the United Kingdom, it is recognised
that as Australia grows, so will our contribution, in a security
sense and in the provision of aid. There is a more realistic
appreciation that this country is not making a military
contribution merely in one area or the other, that ' we're doing
so at several points. And there is a more realistic appreciation
that the country which has still a vast continent to develop,
with such limited resources of population, has its own limitations
upon what it can accomplish.
Having said that, gentlemen, I dor't imagine I've covered
your queries by any manner of means, but, broadly, that is the
field which was covered at this time and I feel, in my own
heart, greatly encouraged by the reception given to me as the
representative of this country. It illustrated for me better
than anything else perhaps that I could look for, the regard and
the respect which the Australia of these times is held in the
countries which mean so much to us. The vwanr, co-operative and
friendly relations which these great democratic leaders have
developed for Australia and for its own leadership are, I believe,
happy auguries for the future of this country.
I would just, by way of final cor. ent, say Mr. Chainman,
that the reporting of those who acconipanied me on this tour was
I believe in the best tradition of the craft of journalism, and
I would like to express my personal thanks to them for faithful
reporting and for every consideration given to the subject.
Thank you very much.

QUESTION: L'r, Prime Minister, having soon you in successful
action in Washington, I know the circumstances in which you said
" All the -way with Apparently this has been risconstrued,
not only in Australia but in various parts of Asia. Could you
please reconcile the apparent inconsistency in our desire to be
part of Asia and to participate actively in Asian affairs, and
our equally empha. tic wish that Britain should remain East of
Suez, and that we should be so close to America?
MR. HOLT: Well, gentlemen, in South Viet Nam, and my remarks of
course were directed to that, I had no hesitation in indicating
our full support because, as I've said so often before in this
country, my Government believes that Australia is more directly
involved in South Viet Nam even than the United States of America
itself. We believe that the security of this nation ultimately
is involved in successfully resisting Communist agression in that
country. If it can't be successfully resisted there, then
ultimately, we believe, it will spread through Asia I'm not
saying this is a matter of vears, it may be decades but
ultimately it will spread through South East Asia generally. And
the kind of world in which we will then live will be a very
different world from that which we see today and the even brighter
world which is within our sights tomorrow. And so, when it comes
to American participation, American resolution to see the issue
through in South Viet Nam, Australian undoubtedly is " All the iay".
QUESTION: In view of what you've just said, and in view of the
fact that we know America is in process of a further massive
increase in its forces in Viet Nam, do you foresee at this stage
the possibility of us having to increase our commitment?
HOLT: This was not raised with me, as I have already said,
and I don't regard it as a matter within our early review. Of
course, as time goes on, we will review w. hat the Australian
contribution should be, but there is no escalation in dimension in
contemplation. QUESTION: Was any indication given by Washington of how long the
Viet Nam war could continue?
MR. HOLT: Well, I think a lot of people would like to be able
to forecast this, but r. y political opponent is the only regular
forecaster I know w. ho is prepared to put a precise time on these
matters. I don't think anybody can say with precision, because
it depends on your definition really of military action. I've
always believe that as the Communists were either defeated or
repulsed in major military engagements, they would turn increasingly
to the kind of guerrilla activity which they can conduct at
relatively small, cost to themselves and considerable nuisance and
cost to the forces on our side. We had to contend with that in
Malaya for, what was it, 12 years or thereabouts. But the fact
of the matter is that I had a very thorough briefing on all this
at the headquarters of Admiral Sharp just two days ago as we came
through Honolulu. There is no rmaor engagement these days that
the Viet Cong is winning. Whore the Viet Cong measures up in a
major force, then the forces opposing them are gaining the victory.
the loss ratio is running at about 5 to 1 in respect of the Viet
Cong and North Vietnamese forces against those on our side. Our
people are much better equipped and better organised. There is
improvement in intelligence. There has been a good deal of
success in halting the flow of materials, but even so materials
do get through. We know that the North Vietnameso and the Viet
Cong are having difficulty about food supplies, even more so with
medical supplies. But how long they'll go on taking this kind of

punishment is in their minds, not in ours. So no one can give
you a precise answer on it. I said when I came back from South
Vit Nam that the Viet Cong could not win, and that ve were
making good progress in the military field. That is confir,. cld
by the latest advices which reach me, and results in the guairod
optimism -which has been expressed in 1Washington in recent tim~ i
QUESTION: You state the need to penetrate the Bamboo Curtain
by way of trade and cultural and scientific exchanges. Did you
put this specifically to President Johnson, and, if so, could you
give us his reaction?
IM. HOLT: I did not put it specifically on my first visit. We
had very lir. ited time on the first visit for close personal
discussion. By the time the various ceremonies were carried
out we had a luncheon at the iJhite House where we both spoke;
the next day he left on a speaking tour himself for a couple of
days. He had said to me that he wished to speak with me further
and as this had not arisen by the time we left, I wasn't altogether
surprised when in London he urged me to come back via Washington
before I camjron to Australia. But, in the meantime, and of my
own initiative, I advanced these views while I was in New York.
I think that a large body of opinion in America would favour some
development along those lines. It's not easy for a politician
facing election to advance some of these ideas. I felt they
should be advanced and did so and I don't think anybody was
unduly disturbed by them. I think more hard thinking is now
being given to what ought to be done in relation to China, just
as I hope that inside the Communist camp more hard thinking is
being devoted to w. here they are getting by their present policies.
They must see that they are driving a lot of the non-Communist
world more closely together and that if they allow another ten
years of this process to go on, then there will have been built
up economic strength and trade relationships which they might
find prejudicial to their own interests later on.
. QUESTION: Now that it is clear that the bombing of Hai Phong and
Hanoi has not compelled Hanoi to negotiate on terms acceptable
to the United States, there seems every possibility of an
escalation of bombing in North Viet Nam. There have been
forecastsby American spIkesmen that the next steps might be to
knock out power lines, dams and canals. If this eventuates,
can we assume that the pledge you gave Mr. Johnson of " All the
Way" means that, in advance, we have endorsed such actions?
MR. HOLT: You're dealing with some quite hypothetical situations.
As far as Australia is concerned, just as we were closely
consulted before the other operation, I . m s~ irc . io .: iuld bL-made
, ahy :; fig nifici. at dchngc in American tactics.
QUESTION: Mr. Holt, as Australia is proving herself such a
firm friend of America, did you seek American aid for national
development in Australia while you were there, such aid that
America has given to countries that have been hostile to her?
LR. HOLT: No. I made it clear when I got there that I hadn't
come ' to ask for anything. We are, it is true, a good friend of
America and I hope that's a general feeling in this country.
I don't know where people would choose to look for the security
of this country were it not for the friendship and strength of
the United States. There is no lack of will on the part of the
United Kingdom Government, for example, no lack of goodwill

toward this country, but its own capacity to help is limited
these days, and you and I and the rest of us are secure in
Australia today because our security has been guaranteed under
treaty by the United States of America.
QUESTION: If I right take an earlier question a little further.
You have had the opportunity of seeing the situation in Viet Nan
yourself and these talks in the capitals in London and iWashington
how much hope do you put in peace in Viet Nan say, for example,
with Mr. Wilson's forthcoming mission?
MR. HOLT: You don't want me to predict in advance
that it's not going to got anryhcre. I prefer to leave
any cocnt on that until we see the-outcome.-I'mi sure we wish
MIr. . i. lson well in his efforts. He has, of course, made many
visits to Moscow in the past, particularly during the period
when he was President of the Board of Trade, and so he is well
known personally to several of the leading personalities there.
I'm sure that there could be nothing but value from the close
talks that he would have with Mr. Kosygin and other loading
members of the Administration. But, whether the Russians would
act independently of any general Communist attitude, I think is
highly doubtful. But at least as Co-Chairman with the United
Kingdom, there is purpose in them having talks together and from
what I have seen of wilson, if anybody is capable of putting
a view clearly and compellingly, then he possesses those
attributes. QUESTION: Mr. Holt, in place of an extension of the bombing of
North Viet Nam, do you see a greater likelihood of American
ground action from bases in Thailand? Has the President given
you any indication of what the next phase is if the bombing
fails to stop the movement of troops along the Ho Chi Minh Trail,
and if ground action is in his mind, do w. e support it?
MR. HOLT: Well, I dor'lt want to canvass publicly what were
clearly private discussions between us on various possibilities
which may arise. I've already said that we were not asked to
increase our commitment nor have we. But we shall certainly
be closely in touch with the United States regarding future
developments. My own impression is that the Thais have made
it known that they wish to cope with terrorist activity within
their own borders. But I wouldn't claim to be inside their
ninds on that matter, I haven't had any recent discussions with
them. QUESTION: Do you feel that the United States regards Australia
as a more important ally in the South Pacific than Britain?
MR. HOLT: I wouldn't know about that. I'm sure that the
United States values Great Britain's tremendous influence in
world affairs, and there has been for a considerable time a very
close working relationship between the United States President
of the day and the United Kingdom Prime Minister of the day.
In the case of President Johnson and I1r. ' iilson, there have been
frequent exchaiges, visits by iMr. W-ilson to him. Indeed, Mr.
Wilson will be making another one within the next week or so,
on my understanding. The United States would, I think,
believe that Great Britain will tend to decrease its role in
this area of the world. It sees in Australia a country, not
only which already enjoys good relations with others in the
area and which itself by virtue of its geography and circumstance
is placed significantly in the area, but that looking at some
point well ahead from where we are now, we shall be a country
of increasing population, increasing economic strength, able to

play an incroasing part in the affairs of the area. And it
is understandable therefore that , e should be regarded as a
partner, and cw are undoubtedly now regarded as a w,-arm and close
friend. QUESTION: You said a moment ago, Sir, that you did not discuss
the question of trade with China with the President on your first
visit. Could you say whether you discussed it on your second
visit? IR. HOLT: Notin specific t. nrms
QUESTION: Mr. Holt, have you asked the President to come to
Australia and, if so, has he been able to give a time when he
might be able to visit here?
MR. HOLT: I've made it clear that there would be a warm welcome
for him whenever he can arrange to come, and I know he iwould like
to come indeed after we'd gone for the journey down the Potomac
he took me back to the vihite House and arranged for a screening of
a 20-ninute film which he'd taken out here some 25 years ago or
thereabouts, when he was a servicer. an in this area of the world;
it was like most moving films taken by an amateur photographer,
not the best example of the cinematic art, but I've asked him for
a copy of it for our own national archives.
QUESTION: Sir, you've spoken about our alliance with the United
States. You've said that the British attitude towards this part
of the world is going to have some influence on our policy
thinking. You were also reported as saying while you were away
that it was expected that defence expenditure in this country
would rise to about 5 per cent of our gr: oss national product.
Does not this junct. ure of circumstancos mean that we are. going to
have to expect substantial increases in our national sacrifices to
play our part in this part of the world in the coming years?
MR. HOLT: Well, that depends on productivity, the run of the
seasons and a variety of other matters. ! e have, as you know,
entered into some arrangeonts to spread part of the cost of the
defence equipment that we're scocuring a little more widely. The
figure of 5 per cent is one which was mentioned to me by the
Treasurer as a figure which seemed to be looming on what he
could see of the trend in defence expenditure. An end to
confrontation would have a bearing on what our costs are, but
I would hope that we would be able to manage these things without
eating unduly into our development prospects. One f the factors
here which will have a bearing will be the extent to which
capital inflow is sustained. We've had a remarkable year in
that respect, an all-time record inflow, but there are the
restraints being imposed in Great Britain on a voluntary basis,
and some uncertainty as to the future availability of capital from
the United States now that money has shot up in price so much
all around the w-orld. Quite remarkably in *. estern Germany, the
Government is pa-ing there 8, 9 and 10 per cent for money. And
in Great Britain, of course, a 7 per cent bank rate has just been
introduced. So the cost of money may itself prove one of the
limiting factors on the availability of capital here. Now, these
things could all have a bearing on how far we have to restrain our
own expenditures. There is only one country in the w orld that
currently withholds a higher percentage from consumption of its
gross national product, a fixed capital and investment, and that is
Japan. Australia ranks next. So we're already doing a great deal
to help ourselves. I would hope that, with our own efforts, and
with the sort of inspiration that this growth, this feeling of growing
responsibility, a growing place in the world brings,, will result for
us all a better national tema. work enabling us to meet these cor:. itmont,

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