My dear P.M.,

I arrived here on 10th December, as arranged, after a useful trip.

I saw the west coast of Australia from the air, had a rapid 48-
hours look through Java by train and car, stayed with Sir Hugh
Clifford [1] and saw the Base at Singapore, motored up through
Malaya to Penang and saw something of their worldshaking tin and
rubber industries, had 3 days in Cairo and a long talk to Lloyd
[2]-then 2 or 3 days each in Rome, Florence, Venice, Vienna
(stayed with Leeper [3]), Coblenz, and Paris. It was all most
entertaining and we filled in a good many gaps in our maps. I am
most obliged to you for having made it all possible by letting me
take nine weeks to get home.

I have seen Sir Granville Ryrie [4] and Trumble [5], as well as
most of the F.O. and D.O. people. I will have, I think, no
difficulty in working harmoniously with Australia House.

Campion [6] called at the Dominions Office lately and, in
conversation with E. J. Harding [7], he said that since his
appointment with the Commonwealth terminated in 1925, he had been
in hopes that his work would have been recognised by the
Commonwealth Government. Harding took this to mean that he wanted
a knighthood of some sort. He intimated that he had a letter from
you, dated 13th June, 1925, in which he quoted you as saying that
you were giving the matter your consideration. Harding said, of
course, that it was not a matter in which either he or the
Dominions Office could interfere. [8]

As to America, I note your letter of 9th October, in which you say
that, in view of Sir Hugh Denison's [9] resignation, the matter of
an Australian Counsellor at Washington (to handle any diplomatic
questions that may arise) may soon be considered by Cabinet. If I
may say so, a good deal of the effectiveness of an Australian
Counsellor would, in my opinion, hinge on his intimate connection
with the Trade Commissioner's Office in New York. There are
happily few opportunities, or rather necessities, for diplomatic
negotiations between the U.S. and Australia, and unless the
Australian Counsellor had some measure of control over the New
York Trade Commissioner's office and its doings, he would, I
think, be rather wasted. I would submit that, if he is appointed,
the Australian Counsellor should spend at least a third of his
time in New York and that a regular and important part of his work
should be the forwarding of Australian financial and commercial
relations by his connection with the Commercial Section of the
British Embassy and, through them, through the British Consular
Service throughout the U.S.

Also you realise, I know, the high cost of living in Washington.

The pay and allowances of the First Secretary and Counsellor
respectively in the British Embassy at Washington are as on
attached sheet. [10]

Canada has made application through the Dominions Office to the
Foreign Secretary, asking if it is agreeable that they establish
Legations in Paris and Tokyo. A favourable reply being naturally
forthcoming they are, I believe, setting about this new
representation forthwith. They have, I believe, at the same time
approached the French and Japanese Governments.

There is a rumour current that the South Africans are about to
start a Legation at Lisbon, but I am told that this is premature
on account of the expense involved. They have considerable
friction with the Portuguese in Portuguese East Africa and Angola,
but up to the present the consequent negotiations have been
undertaken by the British Ambassador at Lisbon.

The Foreign Office tell me that the South African High
Commissioner [11] in London has, in the last three months, begun
to address written communications direct to the Foreign Office,
not through the Dominions Office.

As to Naval Construction in this country, you know, of course,
that two cruisers are cut out of the current year's programme. I
hear very confidentially that next year will see two 'B' class
cruisers laid down instead of one 'A' and two 'B' and that in the
succeeding year (1929) there will be one 'A' and two 'B' (the
normal programme), but that the Treasury have the right to
challenge the 'A' cruiser if the world position warrants it. This
is still all particularly confidential.

Lord Crewe is retiring from Paris and there is great elbowing
amongst the senior diplomats for the post-the plum of the
Diplomatic Service. The people said to be in the running are Sir
George Grahame (now in Brussels), Sir Horace Rumbold (Madrid), Sir
Esme Howard (Washington) and Sir Ronald Lindsay (Berlin).

Possibly, however, it may go to some prominent personage not in
the Service. [12]

A high official at Buckingham Palace recently said to another
highly placed person who is a friend of mine-'I suppose it is not
unknown to you that the King doesn't think much of the Foreign
Office as at present constituted'.

Although it is very much too early for me to make any comment on
this subject, I find, amongst the several people I have talked to,
the same impression that I once before mentioned in a letter to
you-that the F.O. is not as keen and persistent a weapon as it was
under Eyre Crowe. [13] Crowe had a resolute, masculine, possibly
German, mind whereas Tyrrell has an ingenious and resourceful but
feminine type of mind. The F. O. now tends to be more
'diplomatic', more ready to compromise, and-as it was put to me
today-with less guts than before. This is just an impression and
is not based on much more than most impressions are.

Great efforts are being made (I am told most confidentially) to
discover the source of the British Communist Party's funds.

Evidence is practically conclusive that they come from Moscow.

Whilst in Vienna I had talks to Lord Chilston (the Minister),
Leeper and the Commercial Secretary of the Legation. The one thing
of interest to us that they had to say was that the time seemed
ripe for Australian trade representation of some sort in Vienna to
serve not only Austria but Czechoslovakia and the other contiguous
countries. Before the war Phillpotts [14], the present Commercial
Secretary, was British Consul there and was allowed by H.M.G. to
be given a small annual retaining fee by Sir George Reid [15] in
return for his carrying out the job of Australian trade
representative as part time work. He hardly got going before the
war came. He cannot do such work now, but says there are one or
two English business men in Vienna who, he thinks, would perform
the same function for us at a small fee, say 100 per annum. He
suggests in particular that the sale of frozen mutton to Austria
and Czechoslovakia could be started by judicious propaganda. They
are beef-eating countries and mutton is now practically unknown. I
have passed my notes on the above to Australia House.

Phillpotts told me that the Canadians make use of him a good deal
for commercial enquiries but that no other Dominion seems to think
it worth while to do so.

I went last night to a small Group Meeting of the Royal Institute
of International Affairs at which Cooke, of Davenport & Cooke, the
authors of the pamphlet critical of Australian Finance [16], read
a paper in which he reviewed the 'reforms' in Australian Finance
since (and he rather implied-consequent upon) their pamphlet of a
year ago. Andrew Williamson [17] and a few others connected with
Australian industry and finance were there. Cooke does not propose
to publish this paper but is to let me have a copy of it, which I
will forward to you in due course.

Yours sincerely,
R. G. CASEY