My dear P.M.,

The Cabinet yesterday briefly and tentatively considered the
Anglo-American Arbitration Treaty [1] and the proposed American
'Universal Renunciation of War' Pact. [2] Chamberlain [3] told the
Cabinet that the preliminary investigations by the Foreign Office
shewed that the Renunciation of War Pact does not provide for our
position in Egypt, nor does it take into account our commitments
under the Covenant or under the Locarno Treaties [4], nor our
ancient engagements to Portugal. Chamberlain considers that the
peace of Europe depends more than anything else on good Anglo-
French relations and then on good relations with Germany, and he
holds that we must do nothing by way of any treaty with America to
upset these essentials.

Chamberlain is to discuss the matter at length with the French
Ambassador [5] this week and is also putting Sir Cecil Hurst [6]
in touch with Fromageot, the legal adviser at the Quai d'Orsay. He
is asking Stresemann [7] not to reply officially to the Americans
until he hears from him.

Chamberlain is obviously rather perplexed.

Lord Balfour [8], whose reflections are always interesting and
original, thinks that this Renunciation of War business would be
quite possible and probably desirable in the form of a gentlemen's
agreement, but as a Treaty he thinks it would always be too full
of holes.

Soviet Russia is going through probably the worst financial crisis
that she has experienced, caused in the main by the refusal of the
peasants to be bled. Germany has decided that an economic
rapprochement with Russia is, for her, essentially sound but the
practical application of the principle has been found to be
impossible under present conditions, by reason of the fact that
arrangements for credits to Russia have merely resulted in Moscow
opening its mouth wider and wider. So that Germany at the moment
is closing down on Russian advances.

I sent all the 'Bowles' papers on Blockade [9] to Captain
Bellairs, Director of Plans at the Admiralty [10], and have had
the enclosed appreciative note from him, which is satisfactory.

George Wilkins' [11] polar flight is happily ended. I hope and
expect that he used the aerial compass that I gave him before he
started and which he said he would give back to me if he got
through. He is a man I have a great regard for-a serious
adventurer, a bit of a mystic, and a very stout-hearted fellow.

I am afraid that this flight will hearten him for the Antarctic
flight that he has been dreaming of these last four years-from
King Edward VII Land to Graham Land. The Admiralty people, to whom
I introduced him two years ago, told him that it was madness-but
'mad' things are being done these days, and he knows more about
the possibilities and the dangers of such a flight than the
Admiralty, so I fully imagine that he will now have a run at it.

[12] If he decides to do so, I sincerely hope he will get the
support that he wants in Australia and not have to go elsewhere to
get the comparatively small financial backing necessary for a
flight which, if successful, will add something to our claims for
extended Antarctic suzerainty.

The defences of Singapore have again been exercising the minds of
the Chiefs of Staff and the Cabinet. The following extract from a
covering letter that I have written you by this mail will give you
the position, shorn of detail, as it is today:

Originally the Naval Base and the Land Defences were both to have
been completed by 1935, work on the Base going ahead uniformly and
the construction of the Defences to have been completed in two
stages, the first of which was to have been ready by 1930.

Now the Base is to be completed by 1937 and the first stage of the
Defences by 1932. The first stage of the defences includes two 15"

guns and certain 9.2" and 6" guns. The armament constituting the
first stage of the construction of the Defences is now determined
and it is known what will be in place by 1932. The date of
completion, and the detail of the actual Defences that will
constitute the second and final stage, have not yet been decided.

The part that the Air Arm is to play has been mainly responsible
for this state of indecision as to the final schedule of fixed
land defences.

I write by this mail on the subject of Australian co-operation in
Far Eastern Intelligence. Unfortunately, Colonel Blaker's [13]
scheme, about which I wrote you from Singapore, for the
establishment of a combined Far Eastern Intelligence Bureau at
Singapore, has been turned down. So that the remaining
possibilities for us to co-operate, and get some real first-hand
knowledge of what is going on at our back door, consist in (1)
putting a man into the existing small Intelligence Department in
Singapore, (2) attaching a man to the Peking Legation, or (3)
attaching a language officer to the Tokyo Embassy. All three are
desirable enough if money were no object. I am inclined to think
that a man at Singapore would be best value for us at present.

Mond [14] has been away or so rushed when in town that I couldn't
get to see him personally, so that I haven't been able to get much
inside information about his new enormous Finance Company. I send
some bread and butter particulars in another letter.

I have worked out quite an interesting sheet of figures regarding
the percentage of their total budgets that the countries of the
world spend on armaments and defence. It would interest you to
look at, I think.

It shows clearly what an economic benefit some measure of
limitation of armaments would be.

Bowles is producing a shilling edition of his 'Strength of
England' and is hoping for a wide circulation. [15] I am trying to
induce him to give attention to its proper circulation in
Australia, and will probably write you again later in this regard.

I send by this mail a letter giving some particulars of the
interaction of the United States, Canada and Great Britain in the
West Indies and the Caribbean generally. Canada has been working
for years to attract West Indian trade to herself and away from
the United States, with the approval of Great Britain.

There is a parallel, I think, between the position of Australia
and the Western Pacific Island Groups and Canada and the West
Indies. Canada has had American competition to fight whereas we
have had no such spur. Canada has arranged tariff reciprocity and
subsidised shipping lines with the West Indies, whereas we have, I
understand, done little to ingratiate ourselves with the British
island colonies at our doors.

In the course of a walk from his house to his office with Amery
[16] yesterday, I mentioned the contents of my letter about Canada
and the West Indies. He agreed that the parallel that I mention
above was a good one, and went on mildly to deplore the fact that
tariff preference was not universal and reciprocal throughout the
Empire.

I give you the outline in another letter by this mail of the most
important Civil Servants' case which resulted in an acknowledged
mistake being made by the Judicial Committee of the Privy Council.

I will not repeat it here. It cannot but have a bad effect on the
Dominions. Mr. Latham [17] will be interested in this, I expect.

[18]

By the way, in conversation with Amery recently, speaking of the
proposal to amalgamate the judicial functions of the House of
Lords and the Privy Council, he said that he advocated
transferring the Judicial Committee of the Lords to the Privy
Council, and not the reverse as I told you in a recent letter [19]
had been suggested in some quarters. The Privy Council would
remain geographically in its present location, the Judicial
Committee would be strengthened, and they would hear appeals from
courts both in this country and in Dominions.

I am, Yours sincerely,
R.G. CASEY