VI SIT TO US, CANADA AND UKAR Y
WASHINGTON, USA
PRESS CONFERENCE GIVEN BY THE PRIME MINISTER,
MR. HAROLD HOLT, AT BLAIR HOUSE, WASHINGTON _ Np JUNE, 1967
PRIME MI NISTER: Ladies and Gentlemen, I am not prepared to make a direct
statement, but thought it would be useful if I could just give you some sort of
a picture of the talks I had yesterday.
Of their very nature, they don't lend themselves, of course, to any
detailed exposition of it. I wouldn't be received for the talks if I immediately
go out and orate what I have come a long way to talk about and some very busy
men an d very important men have been good enough to provide the time for
me to discuss with them.
But you can assume that I went over the ground, first with the President,
on the principal issues in which Australia is interested in its relations with
the United States. These would include the Vietnam situation, various aspects
of that, the Middle Zast situation, of which I don't claim to be very well
informed myself, but was able to get some valuable information in talks with
the President and with the Secretary of State and with the Secretary of Defense.
Then, of course, because that will be the principal matter I shall be discussing
with Mr. Harold Wilson, in London, the questi6n of British troop di c-positibnC
East of Suez in the future.
I did touch on, with the President, several trade matters and economic
matters of interest to Australia, but did not develop these in any detail at
this point. Wehad agreed that we would make known our views on certain
of them, say that these could be studied in some detail between now and the
time that we shall next meet, when I have part of the week-end with him at
his ranch on my return journey. But I did go into rather more detail on these
matters with Mr. Rusk, and I shall be following them up.
There is one aspect which it now appears cannot wait for treatment
until we get to the ranch. That is the question of the wool duty which applies
to Australia, and on wW ch we had held hopes, as part of the Kennedy Round
negotiations, that there would be a significant reduction of the GT rate.
This has not so far emerged, and we are taking that matter up again with Mr.
Rusk in the hope that we can find a solution to it.
I don't know that there is much more that I can say about the talks, because
as I mentioned earlier, these were to enable a development of views between us.
I think it is well known that the President and I have very much the same view of
the Asian situation generally, the potentialities which are building up in those
countries where Communism has been brought under check, and we both see a
brighter future for Asia if we can bring the Vietnam struggle to a successful
conclusion. Q. Mr. Prime M~ inister, yesterday, I believe, in your arrival statement,
you mentioned the possibility that the war in Vietnam could wind up a lot
sooner than some people expect, and soonier than the surface evidence
indicates I think this is what you said. Would you explain your tninking
along those lines? 2/
P. M. Wiell, there are two, at least two bases for that. It is not put as a
confident expectation, or even as a solid judgment. It is put as a possibility.
Ibase it on these two lines of thought: first, the North Vietnamese are
undoubtedly taking a severe punishment to the economy from the intensive
bombing which has been going on. While I was in Honolulu, I was given a
detailed briefing by Admiral Sharp, which included a survey of the bombing
results. This was accompanied by illustrations in many cases of the
industrial establishments before and after the bombing.
While I know there is a school of thought that the bombing has not
reduced significantly the degree of infiltration and the movement of supplies,
I think there is little, there can be little doubt that continued material
punishment of this sort not only has an effect upon the state of the economy of
the country, but ties up some hundreds of thousands, which is estimated in
the neighborhood of three hundred thousand, members of the work force for
the repair and reconstruction. And the damage to the industrial assets
gas stations, steel works, and the like has been very considerable.
Now, I do not believe that even the most stoic and enduring community
car take that kind of punishment indefinitely without the leaders asking
themselves the question, is this worth it, is the prospect that we have for'
the future worth the sacrifice that we are making now? They can't entertain
any optomistic view in the military campaign against the evidence of their
own losses and the rebuffs they have had in recent times.
So that is one line of thought which leads one to conclude that there
comes a point of time in which the communist leadership has to ask itself
whether it is justified in going on when prospects are held open for it of a
negotiation which at least will leave its own, leave North Vietnam secure.
We have made it clear that we don't have as an objective the domination of
North Vietnam nor the destruction of its economy in the long term.
So the second line of thinking really proceeds from the first. It is based
on some experience we have had of communist, the communist mentality at
work, but it is in the international field and inside Australia in the industrial'
field, where communists have been in charge of some of our more important
unions; we found that althoug,,-, h we have seemed at a particular point in time to
be up against a brick wall in negotiation, with no prospect of a solution
emerging, without forewarning, without regard to consistency or whatever has
gaone before, the communist leadership, having made up its mind that the
time has come to resolve the matter, does so.
So it is on these two possibilities that I make this statement that while,
on the surface, it would appear that there is no crack in the edifice of resistance,
it could come more rapidly than the superficial indications would seem to say.
Q. Don't you think the North Vietnamese could take the same line in view
of the heavy casualties that have been suffered by the Americans?
P. M. I don't think you could compare the two countries from the standpoint
' nf their respective strengths. I am not wanting to understate the American
casualties, but relative to a country of 190-odd million people, it is not a
degree of loss which can't be sustained. The individual loss is grievous, of
course, to the people concerned, but looking at the respective countries, the
loss to North Vietnam is much less capable of acceptance than the degree of
loss which America has been maintaining. 3/
Q. Mr. Prime Minister, with regard to the disposition of British troops
East of Suez, did you find an identity of view here in Wiashington?
P. M. Oh, I think you can take it that the United States shares the Australian
view that British presence, military presence, East of Suez, is important for
maintaining British position in the world and for helping to maintain stability
and act as a moderating influence in relation to that area. It has a bearing
clearly, also, on the United States' position in the Asian region. It will not
be a welcome development to the United States to find itself the only major
power maintaining a military presence on the mainland of Asia.
If you consider the various bilateral arrangements of a security kind
undertaken by the United States, you find that from the arc running right
around from Korea to Thailand, that in respect of a number of countries
* namely, Korea, Taiwan, Japan, Thailand, itself, and currently, of course,
South Vietnam the United States has accepted security commitments and
has left this one area to the Commonwealth, regarding it as a Commonwealth
* responsibility. That is the Malaysi a-Singapore area. But as for the rest of
that arc you find that the United States has accepted a very considerable
obligation and burden for its security.
Q. Mr. Prime Minister, in view of what you have said about the North
Vietnamese bombing, would you favour an increase in the tempo of the bombing?
P. M. Oh, I don't wish to comment on that. America is carrying the large
burden of this matter. I think that the American military judgment should
be looked to to be sure that they get what they regard as the most effective
results from it. I don't think it is for us to tell them what they ought to be
doing, when they are provid~ ing the wherewithal.
Q. Mr. Prime Minister, you mentioned that you discussed the Middle East
situation with the President. I was wondering if you would be kind enough to
tell us what conclusions you arrived at and what decisions you might have made?
P. M. The only comment I can make on that is that the proposal for a declaration
* by certain maritime powers was discuesed and I was able to indicate, this
matter having been under discussion between myself and my Cabinet colleagues
in Australia, that if there were other powers joining in such a declaration,
Australia would join with them in it.
Q. Would we participate in any international military force?
P. M. That question doesn't arise at this stage, and it was not raised with us.
Q. Could you elaborate on those remarks you made do you see any hope
* of salvaging Kennedy Round discussions if you didn't get any concessions?
I can't develop it very much, Max. This is a matter which Mr. McEwen'
has been pursuing very actively. What I was hoping to arrange was for a
briefing on it to be made available to me so that by the time I came back to the
discussion at the ranch, I would be in a position to pursue it further. But I
have since been advised by Mr. McEwen that there is a timing problem on this,
that while some of the other matters with which you are familiar yourself,
can wait for that point of time for discussion, this is one which we have to try
to resolve before the time runs out for the Kennedy Round negotiations.
Q. How are you going to resolve it before the time runs out?
P. M. How are we going to?
Q. Yes.
P. M. Our representatives here will be able to take it up with the Department
of State people. I think the atmosphere which has been created already by
my own talks should prove at least helpful in providing a receptive atmosphere
for this discussion.
Q. So it is not that all hope is gone of getting some concession?
P. M. I would hope not.
You say that there is a time limit. Is there an actual specific day and
hour by which time the problem must be resolved or otherwise?
P. M. This was a factor in th'e negotiations at Geneva. I understand that there
has been a time limit virtually set by the Congress.
Q. Do you know what date that is?
P. m. I haven't it in my head. I have an idea it is around the end of this month,
but don't hold me to that.
Q. Sir, is this a special bilateral arrangement that you hope to reach with
the United States?
P. M. Well, usually, an arrangement of this sort is achieved on the basis of a
negotiation in which concessions are made on both sides. That is where it
becomes a more technical matter for the Department of Trade. I have merely
put it on the basis that the United States is the only country in the world which
maintains a tariff duty on raw wool.
Q. Wihat type of reciprocal offer would we make?
P. Mv. Again, I wouldn't want to be openly exposing what possibilities might exist.
But this becomes a matter of negotiation. It will bear on some import item
they have.
Q. Mr. Holt, will you speak onthis matter cf economic matters generally
in London, also? Will you take it coming back?
P. M. Wiell, the EEC matter, I expect there will be some discussion of that
there between us. But mainly to learn from Mr. Vilson what view he takes
of the British prospects. Mr. Mc. Swen has been there quite recently, so
Australia's views as to particular commodities are well known.
Q. You have no specific problems or questions to ask?
P. Ivi. No, I have none. There are specialists on those matters. I would merely
wish to have a general view from the Prime Ainister of the prospects as he
sees them, what he may have in mind by way of safeguarding what they term as
essential Commonwealth interests, what definition they put on " essential".
I mean it may be essential for a man to reduce his production of dried fruits;
he may have a market to sustain for his dried fruits. But it might be the
view of the British Government that " essential" means that the economy is
able to go on substantially untouched. As Mr. MciEwen said in London, it
doesn't help the grower of dried fruits very much to tell him that we'll be
much better off letting him die off.
Q. Mr. Prime Minister, there is a report that Egypt would consider closing the
Suez Canal to the ships of any nation that might try to break the Israel
blockade. Would Australia consider this as a hostile act?
P. M. You mention it as a report. I have no information on that. I wouldn't
wish to comment.
I would just air that Australia, as one of the principal trading nations
of the world we rank among the 12 largest trading nations of the world
has an interest in seeing that there are no limitations placed on international
waterways. We joined in a declaration some years ago of a comparable kind
to that which is being sou., ht now. -V. e would therefore be expected to tuke a
direct interest in any limitations which any country might propose on what
has been regarded as international waterways.
Q? Would you say what your talk with Secretary-General U Thant might
develop or what you might hope to achieve by it?
P. M. WAell, I would hope that we could explore each other's thinking. W-e
don't agree, quite obviously, on our interpretation of events in Vietnam. I
would hope that one or the other of us would be open to persuasion, if that
is justified from the changed point of view. Different people place a different
interpretation upon events, as I found when I was in Cambodia. Sihanouk
doesn't see events in Vietnam the same way as we do. I think it is quite
obvious thiat U Thant doesn't.
For example I don't want to be on the record on this as a direct quote
from me, but some of you may recall that I did make some comments some
time ago when the Secretary General was reported as having said that Vietnam
was not a vital interest for the West. 11-ell, more recently, he described
Vietnam as leadin), to a third world war. I would find those two statennts
quite inconsistent. Surely if the situation is leading to athird world war, it
is a matter of vital interest to the countries of the Wiest. I have thought all
along that Vietnam was a matter of very substantial concern to the countries
of the West.
Q. Mr. Prime Minister, as we are increasing buyers of American defense
equipment, have you raised with anyone here the obvious inefficiency of the
American forward costing system as demonstrated by the skyrocketing costs
of the F-111?
P. M. Not in any detail. I did in the courseof my discussion with the Secretary
of Defense I think it was Secretary Rusk who mentioned this as one of the
matters which affected the considerable purchase we have been making of
defense equipment in the United States, which, of course, has its own impact
on the balance of payments situation.
Q. Did you suggest the Sydney Opera House as an example of our own
planning? ( Laughter)
Q. Mr. Holt, did you mention, or will you be mentioning the possibility
of Australia gretting some exemption from the interest equalization tax on
money flowing out from America into Australia?
P. M. That is an old concern of mine. I raised this matter in the time of
Douglas Dillon, when he was Secretary of the Treasury. You can take it that I
always felt that if an exemption were justified in the case of Japan and Canada,
Australia, which has highly adverse balance of trade with the United States and
which is making very substantial repayments of borrowed money to the United
Eltates, has a strong case for the exemption, at least up to an agreed level, also.
This is one matter which I shall be pursuin.; further before I return to Australia.