RETENTION OF NEW ZEALAND DIVISION IN THE MIDDLE EAST As stated verbally, I entirely agree with your note of comments to the High Commissioner for New Zealand on 17th May, relative to the considerations which make it highly desirable that the New Zealand division in the Middle East should return to the Pacific to play its part in the war against Japan. 
2. The agreement of the New Zealand Parliament and Government to the retention of their division in the Middle East is another manifestation of that acquiescent attitude to United Kingdom Policy rather than the development of a National Dominion Policy, which has brought them so much applause as the 'curly headed boys of the Empire'. Insofar as the Pacific is concerned, it has always been left to Australia to place the emphasis in Imperial Defence policy on the strategical needs of the Pacific and to give the lead in the development of Dominion forces and resources as a component of this policy. This has been exemplified by the development of the Royal Australian Navy as part of the scheme of Pacific Naval defence which centred around Singapore with a capital ship fleet based thereon. Another illustration has been the development of a policy of National self-sufficiency in secondary industries and the establishment of a munitions, aircraft and shipbuilding industry in Australia. By way of contrast, mention need only be made to New Zealand's tardy development of secondary industries, with the consequence that she has not hesitated to call heavily upon us for coal, fabricated materials, manufactured products and munitions essential to the maintenance of her National economy and war effort.
3. It will be recalled that on the request for the return of the Ninth Division, we communicated our intentions to the New Zealand Government which immediately entered a caveat for the return of their own forces, with the result that the return of the Ninth Division was almost prejudiced.  Joseph Harsch of the 'Christian Science Monitor' recently criticised the effects of our action on the shipping position and the flow of forces for the North African campaign. It was evident that he had received his particulars from an inspired source, because they were suppressed in the later editions of his paper.
4. When reluctant approval was ultimately given by the President and Mr. Churchill to the return of the Ninth Division, we were informed that their equipment could not be forwarded with them, owing to the demands on shipping space.  Yet we are now faced with the spectacle of the New Zealand division being returned to New Zealand for furlough in quotas, the first one being 6,000 men.
5. In discussing the question of co-operation the other day with the High Commissioner for New Zealand, I referred to the division that exists between the South-West Pacific and the South Pacific Areas. Mr. Berendsen deplored that this set up had been necessary owing to American Naval opinion. He added to my surprise, however, that Mr. Nash, the New Zealand Minister to Washington, had been a keen advocate of this division. It will be recalled that Mr. Nash, who holds himself out as the spokesman of the Pacific War Council, recently referred to early offensive blows to be taken against Japan, which inferred that considerable striking power had been marshalled, whereas, at the time, the case for increased forces was being pressed by the Commander-in-Chief and yourself.
6. I frankly feel either that New Zealand is less co-operative towards Australia than to the United Kingdom, notwithstanding our common interests in the Pacific, or that they feel they are overshadowed by Australia and show up better by playing a lone hand, even if it is really prejudicial to their vital interests.
It will be recalled that when the 6th Division A.I.F. went overseas, the Australian Government proposed to the New Zealand Government that we should re-form the Anzac Corps of the last war, but no reply was furnished to the proposal. The Conference suggested by Mr. Fraser to his High Commissioner would have been much better if it had been held before the decision relating to this Division had been taken.
7. I recall the Directing Staff at the Imperial Defence College appealing for a virile and critical Dominion viewpoint in the development of an Empire Defence Policy. They said they did not want just echoes of what they said. A Dominion will never find its destiny as a Pacific Power if it is not prepared to think for itself as to what are its true interests and stick out for them.
It may bring criticism from those abroad who do not get their own way or from a section of our own people who look for their leadership overseas, but it is the only way to build a nation with a strong national sentiment.