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Australia's Northern Shield?


Chapter 5



‘Let the Dutch out and the Indonesians in – how long would it be before we are fighting for Australian New Guinea[?]’.

Robert Menzies, 1958

‘East New Guinea is ours and what we own we fight for’.

John McEwen, August 1958

The disagreement over the status of West New Guinea continued without any apparent prospect of resolution. Meanwhile Indonesia’s leadership confronted serious internal dissent while Australia faced a changing world in Asia. The French had withdrawn from Indochina and the threat of communist expansion in the region had intensified. Australia’s defence planning remained focused on Malaya as the pivotal element of the ANZAM barrier but the attention of Australian politicians rarely shifted from Indonesia.

At the end of May 1956 Menzies left Australia to attend a Commonwealth Prime Ministers Conference in London and to visit Washington and Ottawa. He had also accepted an invitation to visit Jakarta (and other Asian capitals) and preparations were well in hand for a visit to the Indonesian capital in August. The crisis over the nationalisation of the Suez Canal by President Nasser erupted while Menzies was in the United States and he returned to London where he was invited to chair a ministerial committee representing canal users and travel to Cairo to present the terms of a possible settlement to the dispute. Menzies’s efforts were rebuffed by Nasser. His involvement in the Suez Crisis lasted until mid-September. As a result he was forced to abandon his proposed visit to Indonesia. An opportunity was thus lost for the first visit by an Australian Prime Minister to Indonesia and the possibility of building a firmer foundation for the bilateral relationship.1 A further three years would pass before Menzies was able to visit Jakarta. He did, however, undertake the first visit by an Australian Prime Minister to the Territory of Papua and New Guinea from 24 to 28 April 1957 visiting Port Moresby, Rabaul and Lae.

Menzies’ later description of his dealings with President Nasser are noteworthy because they anticipate the comments he was subsequently to make about President Sukarno. Menzies told his Cabinet colleagues on his return to Canberra that Nasser ‘is full of himself. He has pulled noses over the Canal and is looking for fresh worlds to conquer. … They [the UK] know that unless Nasser is cut back to size you will have a new Empire in the Middle East. My view is that we have to remember that you must not underestimate Nasser. He’s had a victory over great powers’.2 Menzies was to employ similar language about President Sukarno as the West New Guinea dispute escalated and was then followed by Indonesia’s policy of Confrontation towards the newly created Malaysia.

Sukarno was equally active on the international scene. In the year following the Bandung Conference he visited the Soviet Union, China, Yugoslavia, Czechoslovakia and the United States where he met President Eisenhower. However, Sukarno’s main preoccupation in the period 1956 to 1959 was with the chronic internal political problems facing Indonesia as the country moved from one coalition government to another and faced serious and destabilising revolts from dissident groups within the army in Sumatra, Sulawesi and other outer islands of Indonesia. Sukarno eventually emerged from these tumultuous events with greater, near autocratic power. In doing so he removed many of the democratic features of the Indonesian constitution and replaced them with his concept of ‘Guided Democracy’.

In this period Sukarno also embarked on an increasingly dramatic campaign to harass and undermine Dutch economic activity in Indonesia. In 1954 he dissolved the Dutch-Indonesia Union and nationalised two major Dutch-owned utility companies. In 1956 he abrogated the Round Table Conference Agreements, repudiated all remaining government debts to the Netherlands and imposed a tax of over 50 per cent on Dutch businesses and increased to 60 per cent the charges on transferring funds to the Netherlands. He also acquired the shares the Dutch airline company KLM had held in the local airline, Garuda. In December 1957 the government seized Dutch companies operating in Indonesia and expropriated Dutch plantations. In 1960 Indonesia broke off diplomatic relations with the Netherlands and launched a more aggressive and threatening campaign to secure West New Guinea.

Sukarno also initiated a number of significant arms purchases, turning to the Soviet Union and its satellites, although some of the purchases were matched by deliveries from Britain and the United States. The possibility that the communist party could secure an influential role in the government and its leaders be brought into the Cabinet became a constant theme in discussions in Canberra and in military assessments of the future of the country.

A new strategic outlook: a sharper focus

Menzies arrived in Australia on 16 September 1956 and immediately faced a number of critical decisions regarding Australia’s defence and strategic policies. On 10 October 1956, a month after his return, Cabinet examined the newly drafted ‘Strategic Basis of Australian Defence Policy’.3 As an indication of the pace of change in Australia’s strategic environment this was the third to be presented to the Menzies Cabinet since it had taken office six years earlier. The assessment gave greater emphasis than previously to the threat posed by communist advances in Asia. It made clear that ‘the first line of Australia’s defence lies in South East Asia and no major threat to her security can develop … whilst Malaya is held’.4 It argued that should Malaya be lost, Australian forces would be required to undertake operations ‘to prevent key areas, particularly in New Guinea, coming under Communist control or the control of Indonesia either by means short of war or through a limited war’.5 Similarly, Australia’s forward defence would have to be ‘based on north western Australia and areas in Dutch New Guinea including the Vogelkop Peninsula … whilst the Admiralty Islands [Manus Islands] and Australian New Guinea contain significant supporting bases which must be secured’.6 It also noted that the dispute over West New Guinea ‘remains a serious source of friction in our relations with Indonesia’.7

Ministers discussed the Strategic Basis Paper on 22 February 1957. The Minister for Defence (Philip McBride) told his colleagues that ‘the fact that communism has been stopped in Europe increases the danger in Asia’. McBride argued that Australia’s defence focus had shifted to Asia and suggested that in this environment ‘the whole object of the exercise is to play our part in helping countries in Southeast Asia to build themselves up and to have confidence’.8 Ministers were united in their view that Australia’s security environment was now firmly set in Asia. Hasluck, now a senior member of the Cabinet, expressed some scepticism as to the reliability of the United States in defending the Pacific. He told his colleagues that ‘we can rely on the US to rely on self interest but if it does not coincide with ours we can’t rely on it in that respect’.9 Senator William Spooner (Minister for National Development) shared Hasluck’s doubts while Menzies was confident that the United States would ‘fight for us and with us’ and believed that it was becoming a ‘little more understanding on Dutch New Guinea … all we can do is to keep nudging them on Indonesia’.10

While all present accepted the broad terms of the strategic assessment, ministers showed a great reluctance to provide the defence force with an increase in its budget. Instead, they looked for savings and began to identify the cessation of the National Service training program as a cost-saving measure. Only Casey registered a note of concern when he drew attention to the defence force’s budget of just less than £200 million for each of the past few years. He told his Cabinet colleagues that Australia ‘could not send more than a battalion or so overseas and the Air Force could not fight a serious war for very long.’11 At an earlier Cabinet meeting Casey had put it to the Defence Minister (McBride): ‘Isn’t it true that we couldn’t send a single infantry brigade overseas without equipment?’ to which McBride had replied: ‘Yep – true’.12

The reluctance to increase the defence budget reflected a deeper argument within Cabinet over the priority to be given to the economic and social development of Australia versus the funding of defence preparedness. Hasluck best captured the sentiment when he told his colleagues ‘what the US thinks, is no reason for a defence vote out of line with our economy. A stable economy is as useful as another battalion’.13 McEwen, in particular, repeatedly voiced his opposition to a redirection of the budget away from national economic development to fund increased defence preparedness. However, by the early 1960s, he was to become the most consistent advocate in Cabinet for the deployment of forces overseas if and when asked to contribute to an allied defence effort. As Peter Edwards has argued, the limits placed on the defence budget and the priority attached to national development ‘required the government to place an even greater emphasis on Australia’s alliances to ensure its security. … Australia could not defend itself ’.14

A strain in the relationship

The issue of pursuing the two seemingly incompatible goals of developing a bilateral relationship with Indonesia and denying Indonesia’s claim to West New Guinea continued to pose problems for Australia. The always unpredictable and erratic Indonesian Foreign Minister, Dr Subandrio, had told the newly arrived Australian Ambassador, Lawrence (Jim) McIntyre, that the issue was one on which ‘the Indonesian Government was prepared for the present to agree to differ with Australia and not let it interfere with our good relations in other directions’.15 McIntyre reassured Subandrio that this was also Australia’s position. McIntyre was not, however, confident that the issue could be separated from the development of the bilateral relationship. Sukarno, after all, had told McIntyre in October that the issue of West New Guinea had created a ‘great gulf ’ between Indonesia and Australia.16 In November, McIntyre wrote to Casey and commented that ‘we (Australia) can never cut any ice here as long as we are identified with Dutch obstinacy’. He added that Australia’s past record of having supported Indonesia’s push for independence was ‘likely to be a wasting asset’ and that ‘our absolute and reiterated inflexibility is bound to tell more and more against us’. McIntyre concluded by advising Casey that ‘without wanting to sound too alarmist I feel bound to suggest that the possibility of a steady and perhaps even accelerated deterioration in Australian–Indonesian relations will have to be weighed against the virtues of our present course’.17

Menzies and his colleagues understood McIntyre’s assessment but were not prepared to change course. Instead Australia continued to look for international support for its policy towards Indonesia and the West New Guinea dispute. At the ANZUS Council meeting in Washington in October 1957 ministers listened to a pessimistic assessment from senior US officials, including the head of the Central Intelligence Agency, Allen Dulles, of the political situation in Indonesia and the growing influence of the Soviet Union on Sukarno. Dulles accepted that Sukarno was not a communist but thought that Sukarno believed he could use the communists to his advantage. Such was the delicate state of Indonesian politics that the United States did not wish to intervene overtly for fear of tipping it in the wrong direction, although it was prepared to sponsor clandestine activities in the outer islands. Similarly, despite arguments offered by both Casey and Australia’s Ambassador to Washington, Spender, the United States declined to change its voting record in the General Assembly from abstaining on the annual Indonesian resolution on West New Guinea for fear of sending the wrong signal to Jakarta. Secretary of State John Foster Dulles did accept that it ‘would be contrary to the security interests of the United States for West New Guinea to come under Indonesian rule, especially if the threat of communist control was present. It would bring Indonesia closer to Australia and be a breach in the offshore island chain’.18 The United States continued to assess Indonesia and the West New Guinea dispute in the context of the Cold War and the threat of further communist advancement in Asia. It was preoccupied with the communist threat in Laos and the aftermath of the defeat of the French in Vietnam. It was not prepared to change its now established policy of non-involvement nor change its vote in the General Assembly.

Indonesia’s actions against Dutch interests, including the confiscation of property and the threatened expulsion of Dutch citizens, accelerated in the wake of a further defeat of the Indonesian resolution at the General Assembly. At this time Sukarno also launched a major reform of the Indonesian constitution under the guise of ‘Guided Democracy’ which, in effect, gave him near-undisputed political power but also raised the possibility that he could invite the communist party into his government. In this climate of uncertainty and confusion the Australian Cabinet met on 11 December 1957 to examine how it should respond to the Indonesian actions against the Dutch. The meeting, however, soon turned into a debate over the role of the United States and its policy towards both the dispute and to the internal political situation in Indonesia. In doing so it highlighted a shift in the thinking of some senior ministers towards Asia and Australia’s relations with Asia in general and with Indonesia in particular.

Menzies described Indonesia’s actions against the Dutch as a ‘serious situation of outstanding importance’. He queried America’s insistence on remaining neutral. Perhaps still smarting from American actions during the Suez Crisis, he commented that the Americans had ‘taken neutrality … to great lengths – for all we know they are preparing for the obsequies now’.19 Harold Holt (Minister for Labour and National Service) agreed that the internal political situation in Indonesia looked ‘unstable and dangerous well into the future’.

Ministers took particular offence at a newspaper report that suggested the United States had offered to mediate between the Dutch and the Indonesians. Casey and others were unable to confirm the report which led McEwen to express his alarm at being denied this advice by the United States. He warned that ‘this [was] the first time Australia has been precipitated into a world crisis in a direct fashion. … We are in the front row – world must watch our attitude – we mustn’t fumble’.20 He then went on to set out the two principles which guided his thinking on the issue: ‘the military need to hold West New Guinea as Dutch territory; and the need not to get into state of bad relations and enmity with Indonesia and therefore Asians generally’. He commented that it was possible that the second principle was more important than the first.

McEwen also revealed his sensitivity towards America’s limited options if it were to involve itself in settling the dispute and commented that the ‘Americans mustn’t make themselves into enemies of Indonesia’. He set out a theme which was to characterise many of his thoughts on international diplomacy over the next few years: ‘nations have to remember that their support or their alliances [are] vital – they can’t afford to let allies down’. He suggested that Australia ‘tell Americans that the prospects of a Communist state between us and Asia is unthinkable for us or them – plug that with Americans’. However, he also noted that ‘an approach to US is no substitute for an Australian policy … I want to see us fix on a policy here now’.21

McEwen was soon to take over the leadership of the Country Party and the newly-named portfolio of Minister for Trade.22 He would act as Prime Minister on twenty-four occasions totalling 550 days from 1958 until his retirement in February 1971. He visited Papua New Guinea once in June 1964.23 McEwen is usually thought of in terms of his role in developing and protecting Australia’s trade and tariff policies but, as will be seen in this and subsequent chapters, this underestimates his considerable influence in Cabinet debates on regional and international security polices and the consistency of his views on Australia’s relations with Southeast Asia and with its principal ally, the United States.

There was a general acceptance within the Cabinet of McEwen’s assessment of developments and his advice on the correct policy approach. Casey added that ‘a communist Indonesia would break the island chain and therefore break into basic policy – don’t think Americans will let this drift’.24 Hasluck agreed and thought that Australia should ‘persuade them [the US] to assume their leadership role in this part of the world’. For the first time in a Cabinet discussion Senator Spooner presented the argument that ‘the Dutch must by degrees and perhaps quickly get out of West New Guinea and then almost certainly out of Indonesia – that means probably a Communist Indonesia – this is a problem for America as well as us’. Menzies acknowledged that this was a ‘critical point in history’. Against the background of the difficulties Australia faced of pursuing its policy towards the dispute while trying to build a relationship with Indonesia or at least not to alienate it, he commented that ‘too much (has) gone into developing [a] friendship with Indonesia to do other than approach this with tact and caution’.25

In keeping with the practice he had begun early in his time as Prime Minister, Menzies followed up the discussions in Cabinet by writing on 12 December to Secretary of State Dulles.26 He set out in detail Australia’s concerns at recent developments in Indonesia and argued that no nation could be ‘indifferent or inactive’ to Indonesia’s attempts to liquidate Dutch interests and ‘the weakening of decent elements in Indonesian life’. Amongst other ideas he suggested that countries such as the United States could look at using their aid programs as leverage to encourage Sukarno towards a more reasonable attitude. He concluded by arguing that Australia was ‘particularly concerned because we are close neighbours of Indonesia and a somewhat exposed member of the Western democracies. We would view with great apprehension the passing of Indonesia into lawless Communist control, the risk or substantial intervention by Russia or Communist China, or a persistent violation by Indonesia of the civilized rules of personal freedom and property’. He encouraged the United States to initiate direct talks with Indonesia so as to ‘avert unpleasant possibilities’. 27 For his part Casey issued a similarly worded press statement on 12 December.28

Dulles replied on 31 December.29 He agreed with Menzies that ‘the situation is most serious’ but disagreed with the suggestion that the US use its aid program as leverage to encourage Sukarno towards a more reasonable attitude. Dulles believed that the situation in Indonesia was so sensitive that any overt intervention by America could have the wrong effect and consequences. Similarly, he argued that any change in the American attitude of neutrality in the West New Guinea dispute would not be welcomed, as even those forces in open revolt against Sukarno supported Indonesia’s claim. Dulles did reaffirm ‘our common resolve to keep Indonesia out of Communist control. It is in the interests of the entire Free World that we should not fail in this effort’.30 However, he was not prepared to alter America’s policy towards Indonesia or the West New Guinea dispute.

The next six months saw further fundamental changes in the political and internal situation in Indonesia. Menzies described the outlook for Indonesia to newly appointed British Prime Minister, Harold Macmillan, as:

there is now a danger that a Communist-dominated Government might achieve power. The situation also contains the possibility of civil war, economic disruption and national disintegration. While these developments are by no means inevitable, the present weak and inept national leadership appears to be able to do little to avert them.31

By mid-1958 Canberra’s assessment was that Indonesia remained in a ‘critical’ state with the prospect of a further ‘slide towards chaos and increased dependence on the Sino-Soviet bloc’.32 From his perspective in Jakarta, McIntyre described the Sukarno Government as ‘whistling in the dark with alternate bravado and anxiety’.33

It was in this environment that the Australian Cabinet undertook a further comprehensive review of Australia’s policy towards Indonesia and the West New Guinea dispute. Casey was soon to leave for The Hague and then to Washington for the annual ANZUS Council meeting and wanted to be confident that he had a full understanding of the Cabinet’s attitude. On 29 July 1958, immediately prior to the Cabinet meeting, Casey wrote to Menzies setting out his thoughts on the question of possible Australian military support for the Dutch. He described the idea of openly aiding the Dutch as ‘possibly one of the most fundamental decisions that we are called upon to make – with long range implications for our own relationships with the Asian peoples’. However, he felt that he needed guidance from Cabinet as to whether Australia would provide military assistance as the US Government would ‘inevitably ask what we propose to do about it – and if I have nothing to say … I would be likely to be thrown out of the door, politely and metaphorically at least’.34

It is one of the remarkable features of the West New Guinea dispute that it returned again and again to Cabinet for assessment and guidance. Ministers examined it from the point of view of political developments in Indonesia, the state of the bilateral relationship, the deteriorating relationship between the Netherlands and Indonesia, the attitude of Australia’s principal allies, notably the United States, and most consistently from the perspective of Australia’s security outlook and the impact on Papua New Guinea. Frequent Cabinet discussion of the West New Guinea dispute exposed Australia’s concerns and uncertainties about its regional neighbourhood but at the same time reflected Australia’s recognition of the need to build a positive relationship with Indonesia.

A joint submission from Casey and McBride examined the dispute from the perspective of both Australia’s defence and foreign policy interests.35 The two ministers made clear that the review was necessary as the risk had increased that Indonesia would resort to the use of force to make good its claim. Sukarno had successfully suppressed the rebellions by various armed groups across the archipelago. By doing so the Indonesian Government was now thought to have the military capacity to launch an attack on West New Guinea. At the same time Indonesia was acquiring substantial quantities of military equipment from the Soviet Union. For its part, the Dutch Government had suggested staff or military-related talks between Australia and the Netherlands to examine possible areas for defence cooperation over West New Guinea. The Dutch had also sought an assurance from Australia that if Indonesia should attack West New Guinea they would not be left to respond to the attack alone but that Australia would assist.36

At the outset of the submission, the two ministers asked for direction from Cabinet as to ‘how much importance do we attach to the Dutch remaining in Western New Guinea? What are the offsetting disadvantages of their remaining? Is there any desirable or acceptable alternative?’37 Ministers had before them extracts from two recently prepared reports from the Defence Committee on ‘The Strategic Importance of New Guinea’ and ‘The Importance of Indonesia to Australia and Regional Defence’.38 Both reports and assessments were sharper, more focused and definitive in tone than those prepared in 1956 and more sensitive to the threat posed by Indonesia to Australia’s defence interests in Papua and New Guinea.

Unlike the 1956 assessment the revised report made clear that ‘as part of Australian territory, Australian New Guinea should be defended’.39 This was the first time such a statement had been made in such bald terms. It then reverted to familiar language by noting that Australian New Guinea could provide an enemy with a suitable area from which to launch air, sea and land attacks on the east coast of Australia. Conversely, it provided Australia and her allies with potential forward bases to defend the northwest and provided defence in depth for the Australian mainland.40 It asserted that the ‘holding of Australian New Guinea should … be a primary objective of Australian defence policy’.41 In turn, ‘the security of Australian New Guinea depend[ed] among other things upon Netherlands New Guinea being in the hands of a power possessing a relatively stable government … which is unlikely to pursue policies inimical to Australian interests. The Netherlands satisfies these conditions; Indonesia at present does not’.42 The defence of Australian New Guinea would be ‘seriously prejudiced’ and Australia would be faced with a ‘grave potential strategic threat’ should a communist-controlled Indonesia secure control of West New Guinea.43 The preferred outcome would be a West New Guinea which remained under the ‘control of a friendly power or, failing that, under neutral control’.44 The latter was a reference to the possibility of the territory being placed under a UN-sponsored trusteeship arrangement. The assumption behind such a trusteeship arrangement was that Indonesia would not be a partner in its administration.

The Cabinet submission set out the pros and cons of the continuation of Australian policy towards West New Guinea from the dual perspectives of Australia’s defence and external affairs interests. It argued that the administration and development of Australia’s half of the island would proceed more ‘safely and smoothly if administration in the western half is friendly and along similar lines. … Indonesian administration or trusteeship in which an Asian element was strong, could very well create difficulties and dangers for us’. Independence or self-government in the western half of the island could lead to calls for a similar outcome in Australian New Guinea while ‘propaganda and other appeals could be made to detach eastern New Guinea from Australian influence’.45 On balance, the submission recommended continued support for the Netherlands. At the same time it argued against Australia entering into military commitments with the Dutch unless the United States was also prepared to enter into such an undertaking. Staff or military planning talks with the Dutch should not be held until after consultations with the United States.

The Cabinet discussion took place over two days. The main speakers were Menzies, Hasluck, Casey, McBride and Senator Spooner, with McEwen also playing a leading role. The length of time given by Cabinet to discussing the Dutch New Guinea dispute was considerably greater than that to any other foreign and defence policy issue until the debate over the Vietnam War in the 1960s. Ministers quickly dismissed the idea of a study of alternative arrangements, such as a trusteeship, and described the suggestion of staff talks with the Dutch as premature. Instead ministers focused on the question of the possible use of force by Indonesia to secure its claims, the likely Australian response and whether Australia was prepared to assist the Dutch militarily. Casey also briefed the Cabinet on his assessment of whether the Dutch Government of Dr Drees would stay the course or succumb to calls from the Dutch Labour Party and others to abandon the issue in order to protect Dutch investments in Indonesia. Casey was confident that Drees would hold firm but ‘we can’t be sure of this lasting’.46 McBride and Casey also alerted ministers to the revised assessment of capabilities of the Indonesian Army following its success in defeating the various rebellions in the outer islands. McBride frankly admitted ‘all the appreciations that I was given during the revolt were wrong. The Indonesians were better than we believed’.47 He added that Indonesia could land a battalion in West New Guinea ‘with little warning and they could do this in spite of the Dutch and of us’.48 The critical question, however, was whether Australia should respond to a threat by Indonesia and what effect the response would have on Australia’s relations with the rest of Asia.

The discussion revealed a Cabinet wavering in its views and unsure as to how Australia should respond to the new pressures being applied by Indonesia. In addition, it was acutely aware that the gradual running down of the Australian defence force had limited its capacity to respond quickly or effectively to any possible Indonesian military activity. Australia had only vague assurances of support from its major allies and no firm guarantees. Spender’s decision in 1950 to pursue Australia’s policy without first securing allied support was now beginning to haunt the Cabinet. The self-confidence and single-mindedness that had characterised the government’s approach to the issue a few years earlier was faltering. Menzies summed up the mood when he said ‘this is not a problem we can stall. As the menace increases so our boldness has oozed away’.49 At times ministers returned to the fundamentals of the issue, following Senator Spooner’s lead in the previous Cabinet room discussion to question whether the Dutch would remain in West New Guinea, whether the territory was vital to Australia’s defence and if the United States would provide military support if Indonesia used force to impose its claim. The Menzies Government was having difficulty in identifying a policy which would adequately address a complex situation and also provide guidance in the event of rapidly-changing circumstances. The choice was to carry on as before with representations to allies seeking support for the status quo, to find a new approach or to do nothing.

McEwen opened the debate by asking ‘What is Indonesia’s attitude to East New Guinea?’50 It was a curious opening question but it reflected the linkages he and other ministers drew between Indonesia’s attitude to West New Guinea and the potential for difficulty in Papua New Guinea. Casey replied that ‘they have never made a claim to it and they have always disclaimed it’.51 This did not settle the issue and ministers returned to the question later in the discussion. Casey also told his colleagues that the ‘Dutch have a few suspicions of us. They say Dutch New Guinea is more important to you than us’.52 This opened up the question of the strategic value of West New Guinea and whether Australia would support the Dutch militarily. McBride noted that ‘Defence has always regarded West New Guinea as very important. It is firmer of course about Australian New Guinea. With a friendly Indonesian hold of New Guinea it would not matter’. On the question of whether Australia could help militarily, the Minister for Defence added ‘we can’t do a great deal to help the Dutch’. Menzies reacted angrily to McBride and to Casey’s comment that Defence, and the Chief of the Air Staff, Frederick Scherger, would ‘look with horror’ on the ‘idea of a war with Indonesia’ with the reply that ‘I suppose that he would equally look with horror on fighting for Australian New Guinea. Let the Dutch get out and the Indonesians in, how long would it be before we are fighting for Australian New Guinea? This is an expansionist movement which has nothing to do with race’.53 This was the first time Menzies had described Indonesia as ‘expansionist’. He was to use the phrase frequently in the 1960s.

The initial questioning by ministers of the threat to West New Guinea turned to a debate over the broader strategic environment. McEwen identified a danger posed by Indonesia and told his colleagues ‘it is hard to get excited about the Indonesians in West New Guinea compared with their threat to us in Indonesia itself ’. He added that ‘a fracas over this is a fracas with Asia’, although he accepted that ‘an Indonesia infested with Russian submarines, Chinese volunteers etc is a very dangerous Indonesia’. The change in the mood of some ministers in Cabinet was summed up by McEwen’s comment:

some years ago I would have fought for Dutch New Guinea. But a hostile Indonesia would impose such a strain on us as would stultify our development. We would have to step up our defence preparations. Our own parties would demand more preparations in the face of a hostile Indonesia.54

He warned that Australia:

had more at stake [in this dispute] than anyone else. … It is not vitally important either to the Dutch or the Indonesians. If Australia is thrown into a different relationship with all Asian countries that could ultimately affect the fate of Australia. … So this decision could be more decisive as to Australia’s fate than the world wars. … If we say that we will fight with the Dutch we may begin a chain of consequences.55

McEwen was showing a breadth of understanding of the complexities of the issue that elevated him above most of his colleagues in the Cabinet. He had recently led the negotiations in 1957 on a groundbreaking commercial agreement with Japan. This may have given him the authority and confidence to speak in broader, more strategic terms, although his reference to ‘all Asian countries’ is odd as he had a very good understanding of Japan’s approach to the region following his negotiations of a new trade agreement.

Ministers, including Hasluck, initially questioned whether Indonesia would ‘go for East New Guinea if they get into West New Guinea’. Hasluck also made clear his firm belief that the principle of supporting an ally against aggression should be maintained and that ‘we can’t allow Australian New Guinea to be threatened’.56 Menzies asked his colleagues: ‘If we are not prepared to fight for West New Guinea are we prepared to fight for East New Guinea?’ McEwen replied: ‘East New Guinea is ours and what we own we fight for’.57 Menzies agreed and summed up part of the discussion by noting:

I begin by assuming that Australian New Guinea is vital to Australia’s defence. So, if this is so, West New Guinea is of great importance to Australian defence.58

Menzies also expressed his sympathy for the Dutch and their treatment at the hands of the Indonesians but thought Australia should avoid responding if questioned about support for the Dutch in the event of an Indonesian attack on West New Guinea. The discussion then turned to the question of whether the United States or others would provide military support to the Dutch. Menzies and McEwen expressed their doubts with Menzies commenting that ‘the US would drop us in this matter’. McEwen assessed it as ‘probable’ that the US would abandon Australia and the Netherlands. McEwen reflected on the Suez crisis and said ‘this is exactly what the US did in the Suez Crisis. And they did it to avoid turning the Arab world against them. Will they not treat the Dutch and us in the same way to avoid turning the Asian world against them?’59

At the end of the second day of discussions the Chairman of the Chiefs of Staff Committee, Lt General Sir Henry Wells, was invited to brief ministers on the military importance of Australian New Guinea and the significance of Indonesia securing control of West New Guinea. He described the two halves of the island as providing both defence in depth and bases for the defence of Australia: ‘Australian New Guinea would be more important if West New Guinea [were] lost’.60 In answer to a specific question as to the implication of the loss of New Guinea to Australia, Wells responded that ‘we would have only Northern Australia for depth’.61

The Cabinet discussions had revealed ministers to be deeply anxious and more prepared than previously to weigh up the pros and cons of continued support for the Dutch. They neither wanted to encourage the Dutch to believe that Australia was ready to back them militarily nor to leave them with a sense of abandonment. Ministers were now more sensitive to the impact on the rest of Asia if Australia were to respond militarily to any Indonesian use of force and more prepared than in the past to look at the issue from a broader perspective of how Asian states would react to developments. However, there is no sense emerging from this discussion of a broader policy towards Indonesia or Asia in general. The Menzies Cabinet remained on the back foot, waiting on developments and uncertain as to how to push the government’s policy objectives. Ministers hoped the Dutch would not weaken in their resolve but had no policy position yet on how best to protect Australia’s interests, only a determination to protect Australia’s position in the Territory of Papua and New Guinea.

On 9 September 1958 Casey met Secretary of State Dulles and senior departmental officials in Washington. Casey gave prominence to the Cabinet’s concern at the possible use of force by Indonesia to secure control of West New Guinea. He made clear that the Dutch were ‘most anxious on this score’ and had asked Australia to give an ‘undertaking to support them by force of arms if such an attack were to be made’.62 Australia had declined ‘at present’ and was ‘most anxious’ to ‘head off’ any possibility of the use of force. He added that ‘such a development would place the Australian Government in a grave dilemma … the first shot fired by an Australian in West New Guinea would destroy the whole basis of the friendly relations with Asian countries which Australia had patiently built up since the last war’.63 He acknowledged, however, that public opinion in Australia ‘might well oblige any government to go to the aid of the Dutch’. Casey asked Dulles to consider adopting a change in United States policy to make it a condition of the supply of any future civil and military aid to Indonesia that it refrain from using force in West New Guinea. Dulles agreed that the principle should be maintained that force should not be sanctioned to settle disputes but would not go further. He also acknowledged that it would be a ‘disaster’ if Indonesia attacked West New Guinea. In such an event the United States would ‘throw its full support behind any defence of West New Guinea’. However, the details and type of support were not discussed except that economic sanctions could be deployed. Casey pulled back from encouraging the possibility of the use of US military force and told Dulles that ‘he did not wish to suggest at this stage that the United States should undertake to use force’. Other ‘deterrents’ should instead be considered.64 Dulles ended the conversation by noting that Australia had not given the Dutch a commitment to assist in the defence of West New Guinea; however, the United States ‘would not mind if we did’.65 The discussion in Cabinet and the conversation in Washington had brought the question of a response to the possible use of force by Indonesia to the forefront of assessments and debate. The question was to remain the principal focus as the issue continued to evolve over the next few months.

Indonesia’s Foreign Minister visits

Throughout 1958 Indonesia’s Foreign Minister, Dr Subandrio, had made it known that he saw value in developing a closer relationship with Australia and that he would be prepared to visit. It had been seven years since the last visit by an Indonesian Foreign Minister to Canberra and three years since Casey’s last meeting in Jakarta. Subandrio had also tried on several occasions to appease known Australian concerns about the possible use of force by Indonesia to secure its claim to West New Guinea. In August 1958 the Indonesian Ambassador had, on instructions, called on the Acting Minister for External Affairs, Philip McBride, to assure him that Indonesia had ‘no intention to use force over West New Guinea because this would not be in conformity with the neighbourly relations between Indonesia and Australia’.66 Prime Minister Djuanda had given Ambassador McIntyre a similar assurance in November 1958, although Djuanda had added that as for Sukarno, Irian Barat [West New Guinea] was after all ‘his hobby’ and ‘he could not be controlled’.67 Despite these assurances Australia remained sceptical, particularly in view of a new round of weapons purchases by Indonesia from the United States and the United Kingdom which had evoked strong protests from Menzies to Macmillan and Dulles. McIntyre told the Head of Indonesia’s Foreign Ministry, Sowito, that a ‘completely unequivocal public statement renouncing the use of force’ was needed to assuage Australia’s suspicions.68 Subandrio had also floated the idea of a mutual defence or security arrangement but Australia had not responded.69

In preparation for the visit Cabinet re-examined its policy in December 1958 and in January 1959 and again sought to develop an appropriate response. The key issues remained the question of the possible use of force by Indonesia and the response to any Dutch request for military assistance. McEwen was direct in his interventions. He told his colleagues that Australia had to ‘re-plan’ its policy approach and that perhaps Cabinet had not thought the policy through sufficiently when it took its fundamental decisions in 1950 and 1951.70 He warned his colleagues ‘can we really expect the Americans to come in with us against Indonesia solo – they won’t go to war against Asia – don’t let us pull our own legs’. McEwen added that ‘we shouldn’t say or sufficiently imply that we will fight with Dutch if necessary. We are in deep enough now but don’t get in deeper’.71 Holt agreed with McEwen’s line of argument and told his colleagues that he had ‘real doubt about the matter of whether Australia and Dutch should engage in a war against Indonesia – could divide the country and very likely the Government. … Our job is to keep US in position where intervention not impossible – Indonesia could not assume that US will not’.72

At the commencement of the Cabinet’s full-day major review of the dispute on 5 January 1959 Casey described Sukarno as a ‘fanatic’ and said that a ‘momentum [had] built up [in Indonesia] and [a] lust for New Guinea’.73 Menzies followed McEwen’s earlier example and said that ‘we must take a good look at our policies to date and admit mistakes if they exist’. He added that the focus to date had been on the Dutch rather than on Indonesia. Menzies was surer in his assessment than in the discussions six months earlier and warned his colleagues that:

if Indonesia does launch an attack in whatever form it will be from that moment a communist satellite – Communists will be the prov-iders and backers and technical experts and the West will cut off supplies – therefore they are de facto communists. If we fight with the Dutch we are at war with Indonesia – not a skirmish in New Guinea but a war with bases being attacked.74

He added that if Australia gave a commitment to the Dutch to use force ‘we are potential enemies of Indonesia and all for a wasting and disappearing asset’. Moreover, ‘Indonesia will, if an enemy of ours, present a much more direct threat to our security than their possession of New Guinea does – a map proves this’. Menzies concluded his assessment by noting that Australia could not string the Dutch along nor should it give a commitment to the Dutch. He made clear that ‘we can’t go into [a] commitment except with US and UK – cards on table. Indonesia [is] much more important to us than New Guinea to [the] Dutch’.75 In Menzies’s mind the key to Australia’s position was clear support from its principal allies. Without it Australia could not act.

McEwen agreed with Menzies’s assessment, again noting that this was ‘a matter of enormous importance to us because geography is with us and we cannot declare war on Asia’.76 In keeping with his overall philosophy of supporting the actions of the United States, he added that ‘if by some unexpected chance the US say here we put in a peg, we also join in. But this is unlikely’.77 He was not keen on the idea of an Australian trusteeship over West New Guinea (‘we would only attract Indonesian hostility to ourselves on top of the huge cost’) nor of giving the Dutch any further encouragement to stay.78 Ministers agreed that Australia could not give the Dutch a guarantee of support but were still deeply concerned about the future. Spooner noted that ‘if we hand over to Indonesia we get Communists right across our top, including Papua’. Hasluck described the situation as ‘communist bully tactics’. In his first recorded intervention on the issue in Cabinet, the newly appointed Attorney-General, Sir Garfield Barwick, commented ‘we couldn’t honestly, physically promise support to the Dutch. Further, we shouldn’t do so – shouldn’t support Dutch colonialism – we can’t afford to do so’.79 Barwick brought a new voice to the Cabinet discussions and was clearly on the side of keeping Australia out of any possible conflict over West New Guinea. In some respects the Cabinet sensed that the tide was turning in the West New Guinea dispute. After a long period in which the issue had been kept in ‘cold storage’ it was soon to emerge and be the subject of new debate and new pressures. A more complicated environment was on the horizon. McEwen was now leading the debate in Cabinet over West New Guinea and reminding his colleagues of the broader consequences for Australia of alienating Asian opinion. Ministers may have shared McEwen’s views but he captured the strategic arguments more succinctly than others. He was also more aware of the consequences for Australia’s relationship with Asia than his colleagues, although the Cabinet was not anti-Asian in sentiment. Nevertheless, at all times, the place of Papua New Guinea was still very much central to any discussions.

Dr Subandrio visited Australia from 10 to 15 February 1959. The government decided at the outset to accord the visit the utmost importance and seriousness. In the now close-to-ten years of the Menzies Government the visit was the most critical event to date in the development of Australia’s relationship with Indonesia. It would see Menzies and the Australian Cabinet in direct conversation with one of the most influential members of the Sukarno Government. The government set as its objective to treat Subandrio in a way ‘that will have the effect of lessening or appearing to lessen the tension between Indonesia and Australia which results from our support of the Dutch in New Guinea’. At the same time the government did not want to allow Subandrio to ‘drive a wedge between ourselves and the Dutch’. It acknowledged that this ‘would not be any easy task’. Ministers would look for ‘any opportunity to help take the heat out of the situation provided it does not compromise our position’.80 For his part, it would appear that Subandrio’s aim was to test the strength of Australia’s commitment to the Dutch remaining in West New Guinea, including its military commitment, and to assess the conditions under which Australia would accept a settlement.

Subandrio was invited by Menzies to join him in a meeting with the Cabinet in Canberra, held a private meeting with Menzies and Casey at the Hotel Windsor in Melbourne and had a conversation with Casey on the flight between Canberra and Melbourne. In the opening phase of his meeting with Subandrio Menzies did not deviate from stated government policy. He reminded Subandrio that ‘New Guinea has great significance in the Australian mind’ while Indonesia had an ‘even greater significance’.81 He referred to the sentiment born out of the experience of the Second World War when he said that for Australians ‘various events, including events in the war, have put New Guinea into the Australian mind and there is an instinctive point of view that New Guinea does not easily divide into two parts and that Australia must be concerned in the future of New Guinea’.82 At times Menzies appeared to revert to his experience as a barrister in the style and tone of his presentation and the questions he posed. He asserted that Australia’s acceptance of Dutch sovereignty over West New Guinea was founded in international law. He made clear that ‘it was Australia’s policy to respect those [Dutch] rights and, as a corollary, to resist any challenge to them which was based on force or aggression in any form’.83 For the first time in the now decade-long dispute Menzies also put to Subandrio that Australia was not a party principal in the matter. Australia had no claim of its own. In contrast to the position adopted by Spender in 1950, he described Australia as a ‘by-stander. But a very interested by-stander because we are interested in the future of New Guinea’.84 For his part Casey, reflecting the views of senior officers in his department chose to remind Subandrio of the importance of recognising the concept of self-determination in assessing the attitudes of the indigenous population of West New Guinea. Casey also hoped that the dispute might, once again, be placed in some form of ‘cold storage’.85

At their second meeting in Melbourne Menzies felt obliged to restate his position as he was not confident that Subandrio had understood the strength of Australia’s commitment to support Dutch sovereignty. For Menzies it was both a legal and a moral commitment. He reiterated that ‘we are neutral on whether negotiations are held but we are not neutral on the question of sovereignty’. He did add that:

just as we respect sovereignty and just as we respect the present sovereignty so we would respect any altered sovereignty if reached … by some appropriate process of law – which means to say by adjudication or by agreement freely and fairly arrived at. In these circumstances we would accept any new position fully and without ill will and I am definite that we would not stand in the way of any negotiations.86

Menzies told Subandrio he was prepared to have his views reflected in a communiqué. Menzies’s remark that his government would recognise a settlement arrived at freely and fairly through adjudication represented a significant departure from the policy developed by Percy Spender. In the early 1950s Australia had gone to great pains to shore up Dutch resolve not to settle the dispute. It is difficult to understand why Menzies made this statement to Subandrio. It had not been part of Australian policy beforehand nor had it been discussed in Cabinet before Subandrio’s arrival. It reflected the advice given to Spender and Menzies by the UK Foreign Secretary, Bevin, in 1950 and 1951 but which, at the time, had been ignored. As a highly trained lawyer Menzies would have recognised the logic of Bevin’s earlier advice but this fact offers no insight into why he volunteered the remark to Subandrio in 1959. Alternatively, he may have known that the Dutch were unlikely to agree to any transfer of sovereignty and hence it represented no real concession.

In his remarks to the Cabinet, and privately to Menzies and Casey, Subandrio did not deviate from known Indonesian policy towards West New Guinea. He did tell the Cabinet that in his government’s view ‘no territorial dispute can nowadays be settled by the use of force’. If Indonesia were to use force ‘it would mean facing not only the Dutch, or the Dutch and Australia, but also the United States and the United Kingdom’. China and Russia could then be dragged in and ‘West New Guinea would be further from Indonesia’s reach than ever and Indonesia itself would be open to fragmentation and disintegration’.87

As to the possible relationship between an Indonesian-controlled West New Guinea and Australian New Guinea, Subandrio acknowledged that Australia ‘may be fearful of Indonesia as a neighbour … but there were no grounds for this’. Importantly for his Australian audience he commented that Indonesia had ‘no territorial ambitions beyond West New Guinea’. He cited Indonesia’s history of living on friendly terms with Borneo and Portuguese Timor as proof of its intentions. He also argued that Indonesian control of West New Guinea could work to Australia’s advantage. Indonesia could not remain neutral in any conflict involving East New Guinea while its possession of West New Guinea would be likely to deter China from any aggression in New Guinea as China would not attack another Asian country. Casey accepted Subandrio’s statement that Indonesia rejected the use of force and suggested that he take an opportunity while in Australia to make these views known publicly.88 Ministers did not respond to the other elements of Subandrio’s argument.

The Joint Announcement released by Casey and Subandrio at the conclusion of the visit emphasised the importance of building the bilateral relationship and co-operating as ‘good neighbours sympathetically concerned in each other’s material progress’.89 On the issue of the West New Guinea dispute, the ministers noted that the two countries held different views and that Australia recognised the Netherlands’ sovereignty over the area and the principle of self-determination. In keeping with Menzies’s commitment to Subandrio, the announcement stated that ‘if any agreement were reached between the Netherlands and Indonesia as parties principal, arrived at by peaceful processes and in accordance with internationally accepted principles, Australia would not oppose such an agreement’.90 For his part Subandrio acknowledged that force should not be used to settle territorial disputes.

The Joint Announcement met with a wave of criticism. It was seen as potentially conceding West New Guinea to Indonesian control and thereby exposing Australia to a threat from Indonesia. The Returned and Services League (RSL) reacted with a claim that ‘once they [Indonesia] get into West New Guinea there is nothing to stop them from claiming East New Guinea’.91 A number of newspapers vigorously pursued a similar line with the Sydney Sun capturing a popular sentiment when it asked ‘of what value will his [Dr Subandrio’s] assurances be if Indonesia falls into the hands of a communist government … New Guinea is Australia’s last bastion against a southward march of international communism’.92 The Daily Mirror joined in the protest by noting that the ‘Menzies Government sees no danger in handing over a territory which is of crucial strategical importance to a country which could at any moment go communist’.93

The strength of the reaction caught the government off guard and it was forced to defend its decisions in a heated debate in Parliament. The leader of the Australian Labor Party, Dr Evatt, attacked the government arguing that the Second World War had demonstrated that the whole of New Guinea was ‘absolutely vital to the security and defence’ of Australia. Evatt argued that sovereignty unquestionably rested with the Netherlands but, in keeping with his long-held advocacy of the use of regional and international arrangements to help build relationships, suggested that a tripartite mutual regional security and welfare pact between Australia, the Netherlands and Indonesia be negotiated to oversee the development of the island.94 Evatt also placed considerable importance on the concepts of governing for the welfare and interests of the indigenous population, a concept he felt had been down-played by the government.

The government was forced to bring in Menzies, Casey and McEwen to defend the terms of the Joint Announcement. Menzies set out in detail the government’s policy, emphasising Australia’s belief that sovereignty rested with the Netherlands. He argued that the discussions with Subandrio had not changed that policy. Menzies was also at pains to point out his government’s ‘genuine interest in the welfare of the young and growing nation of Indonesia … whose goodwill is so important for our own future’.95 Casey argued that the statement of Australia’s attitude towards a possible settlement represented a description of a ‘hypothetical’ situation and was ‘no new departure in our policy’. Nor could it be ‘represented as advice to the Netherlands or to Indonesia on the question of negotiations upon the matter’.96 As the academic Jamie Mackie has commented, ‘whatever the Government’s intention may have been at the time the joint announcement was signed, after the press and public uproar it hastened to erase any impression that it had intended a concession to Indonesia’.97 The government survived the debate and controversy but it had been reminded of the sensitivities within the Australian community towards New Guinea and Indonesia and of the continuing lack of trust by the Australian public in the words of Indonesian leaders when speaking of Australia’s security interests.

The broader security environment – implications for defence

The Menzies Cabinet faced another awkward debate over the contents of the 1959 Strategic Basis Paper produced by the Defence Committee.98 On this occasion the debate was conducted within the bureaucracy in Canberra. The paper, a revision of the Committee’s 1956 paper, elevated the place of Indonesia in Australia’s strategic outlook. The assessment noted that Indonesia’s military strength had been ‘considerably increased by foreign aid’ and that it now had the capacity to ‘pose a significant threat to Netherlands New Guinea and a small threat to Northern Australia and the Australian islands territories of Cocos and Christmas’.99 Indonesia did not pose a threat to the Australian mainland but it could provide bases from which external communist forces could operate against Australia.

The strategic importance of Australian New Guinea was assessed in terms very similar to those in the 1956 report. The paper noted that as part of Australian territory ‘it should be defended’ and that ‘it provided the final defence in depth of the Australian mainland and it must be the primary objective of our defence strategy to hold it’. Its security depended in part on Netherlands New Guinea being in the hands of a ‘relatively stable government which is unlikely to pursue policies inimical to Australian interests’. A ‘grave potential strategic threat would ensue if a Communist-influenced Indonesian government held possession of Netherlands New Guinea’.100

Ministers accepted the broad strategic analysis contained in the paper but reacted strongly against the proposition contained in the section on the ‘Shape of the Australian Defence Force’ that the organisation of the defence force should take into account a possible future situation where Australia ‘may be called upon to defend New Guinea or the north-western approaches by our independent efforts’. The section also proposed that the defence force should, over time, ‘be designed primarily to act independently of Allies’.101 In a rare departure from his practice of letting the relevant minister open the debate in Cabinet, Menzies began the discussion by making clear that he was totally opposed to that proposition and was ‘against the idea of breaking with existing policy of operating with allies’. He added that the paper contained ‘revolutionary ideas about (the) Army’ and that it was ‘politically and financially impossible’.102 Menzies was not prepared to shift Australia’s defence preparedness to one based on self-reliance.

McEwen, who also had a habit in Cabinet discussions of biding his time and waiting until most ministers had spoken before intervening, joined Menzies in strongly attacking the paper. He commented that he could not see where Australia would deploy independently of allies: ‘if it’s Malaya, I assume we have allies, if not, I don’t think they’ll be going overseas’.103 He added that ‘my approach is that in peacetime the Australian Army has not been and cannot be a fighting force ready on an instant, but only a cadre – this on the basis that we have allies who are larger and take the first shock and we tune in later. If we are fighting independently [we] will be fighting at home’.104 Later in the debate McEwen commented that ‘we are too small to run a complete expeditionary force and maintain an acceptable home defence – it is unmanageable or too expensive or both’. As to Indonesia, McEwen told his colleagues: ‘I put my faith in diplomats and politicians – if they can’t avoid us getting into a tangle with Indonesia that’s that. The soldiers can’t then win for us. Even to fight is to lose’.105 In an earlier discussion of the Strategic Basis Paper and its suggestions for a possible reshaping of the defence force he rejected out of hand the idea tentatively raised by some ministers that Australia should strengthen its defence capability by acquiring nuclear weapons. He bluntly told his colleagues ‘if we were to drop one on Djakarta [we] would never live in Asia again’.106 He argued that Australia had to ‘develop our associations and economic relations with Indonesia – get to know them better. Take initiatives ourselves so that the chance that they will jump the gun against us [is] reduce[d]. We have gained ground over past twelve months in this. Also the Dutch have less expectation that we would go in with them’.107 McEwen was again thinking in the broadest terms of the ramifications in Asia of Australia’s foreign and defence polices. Although he supported military action in concert with Australia’s allies, he continued to demonstrate a keen awareness of the long-term consequences for Australia.

Menzies was momentarily, and uncharacteristically, less confident that Australia’s allies, notably the United States, would support it immediately in a conflict over New Guinea. It had ‘adopted [an] equivocal position re New Guinea – they have certain words of assurance but they have other policies and views which could deter them. So it is conceivable that we should be fighting on our own or with the Dutch against Indonesia. A hell of a situation but not an impossible one’.108

The Cabinet discussion continued to show the strain emerging in the thinking of ministers towards Indonesia and the resolution of the West New Guinea dispute. The pressure on ministers was increasing and they were leaning more towards avoiding military action to defend Dutch sovereignty over West New Guinea. A frustrated Menzies had ended the discussion by noting that ‘we’ve got a navy and an air force which can fight now. But the Army can’t. We haven’t got a fighting force and we can’t let it go at that’.109 Nevertheless, at a later Cabinet meeting ministers agreed to the abolition of the National Service training program as a cost-saving measure.110 The Australian defence budget in 1958–59 stood at £189 million and was projected to rise to £193 million in 1959–60.

Menzies visits Indonesia

Menzies arrived in Jakarta on 1 December 1959 on the first official visit by an Australian Prime Minister to Indonesia ten years to the month after becoming Prime Minister. He was at the height of his powers. He was unchallenged in Cabinet and in Parliament. He, rather than Casey, determined Australian foreign policy. He had the strong support of the media and the population in general. Menzies had the status of an elder statesman, being one of the longest-serving political leaders on the world stage. Sukarno had emerged triumphant from the threat posed by army rebels in the islands and was in total command. He too was unchallenged. He too was a world statesman as a leader of the newly formed Non-Aligned Movement representing developing countries.

In all his public speeches in Jakarta Menzies adopted a positive and encouraging tone and emphasised the willingness of Australia to help in Indonesia’s development. He told his audience that ‘this great republic of Indonesia lying there on the north west of Australia is our greatest and most powerful neighbour and we are interested in what goes on’.111 Later, he added ‘we [Australia] believe in our hearts that you can become great, not aggressively powerful, but great and strong and free and happy. And in that task, whenever you feel that you need a friend you have only to turn in our direction’.112 Menzies adopted a similarly co-operative tone in his meetings with First Minister Djuanda, Foreign Minister Subandrio and Minister for National Security and Chief of the General Staff, General Nasution.113 (Shortly after Menzies’ departure Australia and Indonesia signed a trade agreement. Australia’s exports to Indonesia at the time totalled £3,221,000 while imports, mainly of oil and petroleum, totalled £29,438,000.114 Between 1950-1951 and 1963-1964, 943 Indonesian students studied in Australia under the Colombo Plan. This was close to twenty per cent of the total intake of students under the scheme.115)

Menzies met President Sukarno at Bogor Palace on 6 December for their official conversation.116 It was perhaps the most important meeting between an Australian and an Asian leader since the end of the Second World War and one of the most important in Australia’s post-war history. It could be argued that various meetings with the leaders of Japan and their outcomes had established the basis for Australia’s economic and commercial growth but these meetings were non-controversial compared to the issues confronting Australia and Indonesia. It was a meeting which combined ceremony and substance and went to the core of the relationship between Australia and Indonesia and the issue which bedevilled it. Djuanda, Subandrio and Tamzil, Chief of the President’s Cabinet, were present with Sukarno. Menzies was accompanied by Ambassador McIntyre, Maurice Timbs from his own department and Peter Heydon from External Affairs in Canberra.

The conversation focused entirely on the West New Guinea dispute. Sukarno described the issue ‘as the one question standing against the development of close and friendly relations between Indonesia and its near neighbour’. At Menzies’s invitation he explained the history of the dispute and Indonesia’s frustration at the Netherlands’ refusal to honour a ‘gentle-man’s agreement’ to transfer sovereignty as expected in 1949. The President described the issue as ‘paramount in the minds of Indonesians since it represented the principal element of incompleteness to their independence’. He asked why Australia always appeared to side with the Dutch and described the Dutch as being ‘largely influenced by Australia’. Menzies replied that Australia was not a party principal in the matter and, in a further departure from established policy and, contrary to the views Cabinet had expressed in the mid-1950s, suggested that the dispute could be settled in the International Court of Justice. He added that Australia would ‘unhesitatingly accept’ the Court’s decision. Sukarno did not respond to this suggestion. Menzies also referred to the assurance that Dr Subandrio had given in February that Indonesia would not use force to pursue its claim. Sukarno ‘repeated that there was no question of any use of force’. He also told Menzies that he could be quoted on this and that he would ‘underline Subandrio’s declaration three times’. Menzies referred to his discussions with Subandrio in Australia and, despite the earlier public criticism of the terms of the Casey–Subandrio Joint Announcement, he repeated his undertaking that ‘if the Netherlands and Indonesia reached an agreement over the future disposition of the territory, freely negotiated under no threat of force, Australia would respect it’.

Menzies took the opportunity to set out the reasons for Australia’s interest in New Guinea ‘as a whole’. He noted that in two world wars ‘New Guinea in hostile hands had offered a threat to Australia and Australians had fought there’. He added that he ‘well understood and respected the profound emotional significance of West New Guinea to Indonesians. But it must be understood that Australians also entertained deep feelings about New Guinea’. Sukarno appeared to dismiss this argument, noting that ‘the days of colonialism in Asia were over; nationalism was the new driving force’. Germany and Japan were distant countries and ‘Indonesia now stood between Australia and the rest of Asia’. This drew Menzies to raise the spectre of ‘aggressive communist imperialism the threat of which extended southward from China through North Vietnam’. Menzies acknowledged the efforts by the Sukarno Government to curb the influence of the Chinese community but added that ‘Australia contemplated with apprehension the risk that Communism might somehow come to power in Indonesia. … The greatest danger might be that of subversion and covert infiltration’. Sukarno ‘gave his personal guarantee that this would not happen as long as he was the leader of Indonesia’.

Menzies spoke of the importance Australia attached to the principle of self-determination in Papua New Guinea. He also outlined his government’s programs ‘to bring the inhabitants to the stage where they could decide for themselves about their own future’. This was his only specific reference to Papua New Guinea and he made no attempt to refer to it in the context of Australia’s security interests. He next raised the issue of the ‘racial differences’ between the people of Indonesia and the ‘Melanesians of West New Guinea’. Sukarno and Subandrio rejected the observation, with Subandrio arguing that ‘race is no longer the valid criterion of nationality; economic, political and geographical ties and interests were more cogent’. Menzies was more direct when he remarked that some Australians ‘saw no reason why the Melanesians of West New Guinea should exchange Dutch colonialism for Indonesian colonialism’. Again, both Sukarno and Subandrio ‘amicably but emphatically’ denied that the transfer could be regarded in this light.

Menzies drew the discussion to a close by referring to the points of common interest between the two countries and ‘expressed the view that whatever differences might remain – and it was only natural and proper that there should be some differences of view – genuine friendship and understanding could be fostered’. Sukarno was unimpressed and, according to the Australian record of the meeting, ‘sounded sceptical … he came back again to the point that there could be no real improvement in relations until the West New Guinea issue was settled and out of the way’. Both leaders agreed that in their comments to the press they would report Sukarno’s declaration that Indonesia had ‘no intention of resorting to force’ to acquire West New Guinea. Menzies closed the discussion by extending an invitation to Sukarno to visit Australia.

Menzies left Jakarta for Kuala Lumpur and the cooler climate of the Cameron Highlands, satisfied with the outcome of his discussions. He had obtained what he wanted which was a reaffirmation from President Sukarno of Subandrio’s earlier commitment that force would not be used by Indonesia to secure its objectives in West New Guinea.117 Menzies attached great importance to a leader’s word or commitment and he would now hold Sukarno to his undertaking. It was fundamental to the question of trust and Menzies now had something very concrete by which to judge Sukarno. This would prove vital in Australia’s handling of the dispute over the next two years and would influence Menzies’s attitude towards Sukarno and his ministers as events unfolded over West New Guinea and then during Konfrontasi.

For his part, Sukarno may have been pleased that he had explained fully Indonesia’s position to Menzies and had rebutted or rejected a good number of the assumptions or claims put forward by the Australian leader. Sukarno offered no hint of a possible compromise, such as a trusteeship arrangement, but on ‘several occasions hinted that Australia could help persuade the Dutch to come to terms with the Indonesians … without asking’. Whether deliberately or not, he had inserted the word ‘intention’ in his comments about the use of force to settle the dispute, perhaps providing him with a loophole as the word could be interpreted to mean that he had no plans at that moment. Sukarno had remained firm in his belief that Indonesia was entitled to and would eventually acquire West New Guinea from the Dutch.

On his return to Canberra Menzies briefed the Cabinet on his talks. He drew a stark contrast between Sukarno, Indonesia, Prime Minister Tunku Abdul Rahman and Malaya. He described ‘the Tunku’ as being ‘very friendly towards Australia’, as having ‘no objections to [the] white Australia policy’, and as having made ‘no suggestion of objections to Australian troops’. Malaya was ‘very friendly towards Australia’ and the Tunku was a man of ‘great charm and trust’.118 In contrast, Menzies described Sukarno as being ‘quiet’, while the President’s ‘guided democracy’ was not a ‘cover for democracy but for a dictatorship’. He added that Sukarno ‘behaves and lives as a dictator’. Indonesia was living from ‘one crisis to another [with] everything coming away in your hands’.119 Sukarno was not interested in economic and administrative problems and the country was heading ‘back to [a] rural peasant economy’. Menzies did remind his colleagues that the President had ‘affirmed no use of force on West New Guinea’ and had done so publicly. In response to a question from Holt as to the strength of Indonesia’s commitment to West New Guinea, Menzies noted that ‘none of the ministers raised it’ and that it was an interest of ‘Sukarno only’.120 He also reminded the Cabinet that he had invited the President to visit Australia.


The three years dating from Casey’s meeting with Sukarno in 1956 had been difficult ones for Menzies and his government in their dealings with Indonesia over West New Guinea. They had struggled with assessing the implications of the dispute for Australia and had produced few new ideas. Indeed, the government had reversed some of the principles which had previously guided it. The confidence which had characterised the government’s handling of the dispute in the first half of the decade began to slip away as it faced the question of whether it would support the Dutch if Indonesia used force to pursue its claim. A new sense of anxiety and frustration had begun to emerge as ministers contemplated the repercussions of military involvement. The Cabinet was aware of the weakened state of Australia’s defence preparedness. It was also showing a greater awareness of the implications for Australia’s relations with Asia should it intervene militarily. All ministers were increasingly sensitive to this aspect of the problem but Deputy Prime Minister John McEwen expressed it most frequently and clearly. The pressure that ministers felt they were under also caused them to express increasing degrees of sceptism as to the reliability of the United States in providing support, including military support, should Australia (and the Dutch) face Indonesian aggression.

Australia had taken comfort from the comments by Subandrio and Sukarno that force would not be used to resolve the issue but had also conceded, for the first time, that if Indonesia and the Netherlands reached an amicable agreement which settled the issue then Australia would not object. Menzies had also suggested that the International Court of Justice could be used to settle the outstanding issue. He had conceded significant elements of Australia’s policy – that Australia was an interested party to the dispute and believed it had a voice in how the dispute should be resolved. Perhaps Menzies knew that the Netherlands would not reach such an agreement and hence it was a hollow gesture but it was an important point to concede publicly.

Menzies’s meetings with first Subandrio and then, most importantly, Sukarno were historic. Both were long overdue and both could have been of significance in setting the tone for the future relationship between the two countries. At face value Menzies and Sukarno achieved their objectives of explaining their respective points of view over West New Guinea. The meeting did go some way towards establishing a degree of mutual understanding between the leaders of each country. Menzies was to place considerable store on this point in the years ahead as he sought to hold Sukarno to account for his promise not to threaten to use nor indeed to use force to secure West New Guinea. But Menzies had not been won over by Sukarno. His comments to the Cabinet suggest that he saw Sukarno as a dictator of a country steadily falling into economic ruin. Menzies saw little reason to trust Sukarno and did not seek to contact him again during the remaining six years of his Prime Ministership.

Both leaders, but particularly Menzies, were soon to discover that they were not the only parties actively interested in the outcome of the West New Guinea dispute. A change in Administration in Washington was to bring about a fundamental change in approach leading to a negotiated settlement. Australia was caught off guard by the new policy ideas emerging from the Kennedy White House and was forced to adjust quickly. The anxieties which had been revealed in the Cabinet discussions in 1958 and 1959 were to be heightened further.

Australia's Northern Shield?

   by Bruce Hunt