Allison, Director of the State Department Office of North East Asian Affairs, yesterday told McNicol on a strictly personal and confidential basis, that there was now considerably more support in the State Department for a Pacific Island pact which would insure Australia, New Zealand and the Philippines against Japanese aggression and also guarantee Japan against Soviet aggression. Although Allison did not elaborate on Japan's role in such a pact, he gave the impression that Japan would be included in some fashion, and remarked that the Japanese were the most reliable people in Asia and that Japan's industry and manpower was the prize which the Soviet was seeking. Allison said that Dulles had come round to the support of a Pacific Pact. He emphasised that the question of a Pacific Pact had not yet been taken up at Secretary of State level, that it would require 'a lot of working out', and that 'something might or might not come out of it'.
2. Allison also said that the Department was most concerned about Japan, and that Dulles and he were at present devoting most of their time to consideration of a Japanese Peace settlement.
3. You are aware that Allison has for the past 18 months been an advocate of a Pacific Pact in the context of a Japanese Peace Treaty, and I thought you would wish to know that consideration was being given to this matter at the Dulles-Allison level.