239 Department of External Affairs to Evatt [1]

You will have seen Critchley's telegrams K.155, 156 and 157 reporting on latest United States proposals submitted to Netherlands and Republican delegations. Counsellor of United States Embassy here has called at the Department to explain that American member of Good Offices Committee, with full concurrence of State Department, decided that, in view of deterioration in position of Republican Government, submission of new proposals was matter of urgency. Americans had learned that new Netherlands proposals at present under consideration were likely to be quite unacceptable to Hatta in view of strong pressure on the latter from Communists and Left Wing Socialists. Americans accordingly decided it was necessary to get in first with proposals which they believe have a chance of acceptance by both sides as a basis for settlement. [2]

2. It is clear from this that Americans agree with our view that present moderate Republican Government is doomed unless Hatta is able in very near future to claim credit for reasonably satisfactory settlement with the Dutch; and that Dutch are accordingly faced with clear alternatives of seeking early compromise with Hatta on the few outstanding points or of having to deal with a Communist-led Republic.