Herewith a top secret memorandum on discussions I had in London and in Paris concerning changes in British defence policy. This should receive very restricted circulation, including, I should think, our Ambassadors in Washington, London, Paris, NATO, and Bonn, emphasizing to the latter that great care should be taken to ensure that the memorandum does not fall into unauthorized hands.

L.B. Pearson

(Copies of the memorandum have been sent to the Prime Minister, the Minister of Finance, and the Minister of National Defence.)⁴⁰

[PIÈCE JOINTE/ENCLOSURE]

Note

Memorandum

CHANGES IN BRITISH DEFENCE POLICY AND THEIR INTERNATIONAL
IMPLICATIONS

This was, I think, the most important single subject that I encountered during our sojourn in London. Its implications, for NATO generally, and for Canada even apart from NATO, are very important and could be far-reaching. The story, as it concerns us, is as follows.

On Sunday, June 17, the day I arrived in London, I had dinner at the High Commissioner's with the Foreign Secretary, Selwyn Lloyd, together with Sir Harold Caccia, and Lord Hood of the Foreign Office. Lloyd told us that the United Kingdom Government had been re-examining the basis of its defence policy and would be significantly altering it to take into consideration new political and strategic developments. Changes were also required by economic and financial considerations, which necessitated some reduction of U.K. defence expenditures, which were proportionately higher than any other European country.

They had come to the conclusion that it was wrong to concentrate large forces for the defence of Western Europe when, in fact, the real defence of that area, as well as the most effective deterrent against aggression was the capacity of the U.S. Strategic Air Force to bomb Russia with thermo- nuclear weapons if an aggression took place. What, therefore, was the use of having 50 or 60 or 70 divisions which could never be effective for defence? Why not merely 20 or 30, as a screen on the frontiers, an attack against which would call into play the atomic deterrent? He called this the "trip-wire" theory of defence, though it also might be designated as "burglar alarm" strategy. It would mean a reduction of expenditures of all the NATO European countries for conventional defence and the removal of two U.K. divisions from the continent. Some of these troops would be demobilized and thus would ease the manpower as well as the financial burden.

We were then told that a proposal embodying these new ideas (attached herewith)⁴¹ would be submitted to Mr. Dulles in Washington. We were the only people to have seen it apart from the U.K. Cabinet.

My first reaction to this proposal was that it made sense in terms of defence strategy. Indeed, it would help us solve one of our most difficult Canadian problems by facilitating the eventual withdrawal of some Canadian forces from Europe for use - in the case of the R.C.A.F. - behind the Early Warning Lines in Canada, in lieu of U.S. squadrons which otherwise might be stationed there. However, I also felt that if this British policy were to be implemented unilaterally, without consulting the NATO Council and without trying to secure a new, and agreed, defence directive, the political results might easily be disastrous, especially in Washington and in Bonn, and for NATO itself.

It seemed to us, therefore, that it was of vital importance that the British should not act too quickly or on their own. Lloyd, however, was worried about delay and said they might have to make this a "bolt from the blue" operation. We strongly advised him to proceed carefully and slowly and above all to consult fully with the Americans as well as with the French and the Germans; and ultimately clear the matter through the NATO Council.

It would certainly prejudice the work of the Committee of Three on non-military co-operation if a decision of this kind were taken unilaterally without NATO even discussing it. What would be the use of talking about the virtues of political consultation in these circumstances?

Lloyd accepted all this but was worried about the time element. He said they could not wait beyond the middle of July. He was also fearful about a leakage if there was prior consultation. We impressed on him the impossibility of having this matter discussed, let alone decided, in the NATO Council within 2 or 3 weeks. I did suggest that, in order to avoid publicity, possibly a July meeting of the Committee of Three with the other members of the NATO Council, ostensibly to discuss our work, might be a useful cover for a defence discussion. Later consideration, however, made it quite clear that this would not be a very good device.

Mr. Robertson and I were thoroughly alarmed by the attitude of the Foreign Minister, and particularly by that of his officials, who were so preoccupied with the domestic aspect of this question that they did not seem to appreciate fully its international implications.

On Tuesday, June 19, Mr. Robertson and I saw Mr. Lloyd again, and several of his officials, at the Foreign Office. He told us that their Ambassador in Washington had now discussed their defence proposal with Mr. Dulles, whose immediate reaction had not been unfavourable, they thought. He read us a telegram from Makins, reporting on that reaction. I told him that I was absolutely convinced that they would be making a great mistake if they took this message to mean that the United States Government would not be strongly opposed to sudden unilateral action on the U.K. part of the type indicated Sunday night.

Lloyd was worried, however, about the difficulty of clearing things in Washington at this particular time and also of the danger of leakages if there were discussions in Paris and in Bonn. We felt he should take that risk if the United Kingdom Government were, in fact, going to make an announcement in the House of Commons the following week about defence cuts, as he indicated that they would have to do. I told him that I would be in Paris the rest of the week and would like very much to discuss, on a personal and confidential basis, some of these matters, both with Ismay and Gruenther. It seemed to me that not only the work of the Committee but the whole future of NATO was at stake on this issue; as well, indeed, as the fortunes of the Adenauer Government. I was convinced that the British, from the strategic point of view, were on the right lines, but I was equally convinced that if they carried out their ideas in the wrong way the results might be disastrous. On the other hand, if these changes could be made in the right way, we could exploit them in discussions with the Russians, not only in respect of the reduction of armaments, but also of the unification of Germany. We would have some new cards to play if we had enough skill and will to play them.

I found out in Paris that both the people at the Quai d'Orsay and the Italian and Norwegian Foreign Ministers, my colleagues on the Committee, were aware that something was happening in London. Stories, though vague and general, in the press, indicated that far-reaching decisions were being considered by the U.K. Government in the field of defence. Both Lange (Norway) and Faure (France) indicated to me their anxiety about these developments. "Pug" Ismay was more than anxious. He was acutely distressed at the possibility of NATO being by-passed by the U.K. I have seldom seen him so exercised, and he was very critical of U.K. policy and tactics, even though he also felt that the ultimate objectives might be sound. He asked me to have lunch with him alone so that he could talk to me very frankly, and he did; even to the point of suggesting that he would not remain on as Secretary- General if his country "let him down" in this way. He was considering taking the initiative in calling a meeting of the Council to discuss the matter, or asking some government to do so. I told him that I shared his anxiety but I advised him strongly to do nothing as I felt that the U.K. Government were now giving second thoughts, at least to procedure. I promised to convey his worries in a very personal and confidential way to the Foreign Secretary and said that I would report to him again after I had had further talks in London. He thought, and I agreed with him, that there should be a special ministerial meeting of the Council at the earliest possible date, probably in September, to try to agree on a new defence directive. As this would be primarily a political decision, though with vital military implications, the initiative should come from the Council and a decision on policy made there. I left Ismay, I think, in a better frame of mind than when I found him.

I was unable to see General Gruenther as he had left for the United States the day I arrived in Paris.

On my return to London I saw Selwyn Lloyd late Sunday night, June 24, and told him about my talks in Paris.

Lloyd had had further word from Washington and, as I expected, it was less favourable than Dulles' first reaction. The Americans are very worried and in no position at this time, with the President out of action, even to discuss the grand strategy of defence. They also have their own strong differences of opinions which cannot be resolved in a hurry. So Dulles does not want any meeting of NATO until after the election, and Lloyd says they simply cannot, nor should not, wait so long. He told me, "very, very confidentially", that Radford was favouring their ideas, but Gruenther, now in the United States, was strongly opposing them.

Fortunately, Harold Macmillan did not announce any far-reaching changes in defence policy, when he made his statement on "outs" to the House of Commons Tuesday (June 26). They will now suspend such a policy statement as long as possible, a decision which removes some of our anxiety. But they are impatient at American delays and insist on a NATO meeting by September. However, it seems that our warnings and worries have had some effect here.

On Wednesday night (June 27) at the Palace, after dinner, I got into a corner with Anthony Eden and we had quite a talk, mostly about defence and Cyprus. He was aware of the international implications of the new U.K. defence plans and agreed that they should not be announced without NATO consultation and as part of a NATO agreed plan for Western Europe. He emphasized, however, that they could not wait forever. He had discussed the new strategy with Montgomery who was all in favour of it (though his NATO chief was not) and had put his approval in writing in a personal letter. I was shown (on a personal and confidential basis) a copy of that letter which was a typical Montgomery production, short, sharp and dogmatic. Montgomery thought that a U.S. Corps and a U.K. Corps on the continent quite adequate, with reductions also in continental conventional forces. Eden had been told of our feeling that if NATO were allowed to deal with this matter, it could be exploited to our diplomatic advantage with the Russians. He was very interested in this and seemed to appreciate our views. He is aware of the difficulties and dangers that may arise in Bonn and Washington. I tried to underline both. "If only", he said, "Ike could take hold".

Thursday I lunched with Lloyd and Mountbatten at the latter's house. I arrived first and Lord Louis told me how useful it was that we had impressed on the people here the dangers of the course some of them were contemplating. Like us, he had no objection to the policy itself, but was very worried about the method of announcing and implementing it. Unless care was shown, it would break up NATO and he was convinced that this would be a major disaster. He proposed to talk to Lloyd along these lines at lunch and hoped I would back him up. He did and I did! It was a good talk.

That night at 10 Downing Street, after dinner, Salisbury, who is a great power in the Cabinet, said that Mountbatten had been reporting my views to him. He was very interested, he said, and would I come to Hatfield House for the weekend where we could follow the matter up.

So Saturday evening, after I had pored over some of Elizabeth's and Mary's original letters, the first Cecil's diary, etc., - what a treasure house that place is - we had a long talk along familiar lines. Salisbury seemed to me somewhat more concerned with the domestic, than the international aspect of the problem.

Mr. Ritchie had come over to see me from Bonn on Thursday and left with me a very good memorandum? on the effect of the proposed changes of U.K. defense policy on Germany (copy attached). I had a copy of this with me and thought it would be a good document for Salisbury to see. He was very much impressed by it and I think that after reading it he was more aware of the international difficulties involved in policy changes.

On Friday, I had phoned Ismay and told him in guarded language of my talks here and my hopes that things were now on the rails; that Macmillan's statement in the House of Commons on defence cuts could be implemented without any policy changes and was a holding operation prior to NATO talks. Ismay was relieved and gratified.

On Friday, late afternoon, I also had a word with Selwyn Lloyd about an idea which Charles Ritchie and I had discussed; that Hallstein should come to London to talk with me about German views on the work of the Committee of Three and that, during his visit, which would not, I hope, receive any publicity, Foreign Office people could discuss with him these European defence problems. Lloyd was attracted by the idea, but, after weekend discussions with others, phoned me on Tuesday to say that, on the whole, they thought that it was too risky. The Americans might hear of the visit and accuse the British of trying to alter the policy of the Adenauer Government before agreement had been reached between Washington and London. Perhaps he is right about this. In any event, Hallstein will not be coming.

On Tuesday afternoon the Commonwealth Prime Ministers discussed defence questions at a restricted meeting. During this meeting Eden had the following to say in language which was almost exactly that which I had used to him the other night.

"... The United Kingdom would not however take any unilateral action in adjusting her forces committed to the North Atlantic Treaty Organization. Any alterations would be discussed with the other member countries. There was a further reason for making some adjustment to meet the changed circumstances. At present the political initiative lay with the Russians who had announced their policies for Eastern Germany and had made the maximum use in their propaganda of the reductions in their armed forces. It would be desirable therefore for the members of the North Atlantic Treaty Organization to agree on some counter measures, which could be put forward as a reply to the Russian moves and indicate their willingness to discuss with Russia further measures for the relaxation of tension in Europe. Only by producing imaginative policies would the Western Powers be able to gain an initiative from the Russians."⁴²

I should conclude this story by an account of a visit I had on Wednesday (July 4) at Canada House with General Gruenther, who was returning to Paris from Washington via London. He was much perturbed at the British suggestion for an early meeting would do more harm than good at this time, especially as governments would not be prepared for it. I told him that while this might well be true, nevertheless NATO governments were all giving serious thought to new defence policies and plans, and it would be an unhappy development for NATO if decisions in this field were made unilaterally. I indicated that while the British a few weeks ago were talking of a July meeting, they were now quite willing to wait for some time, but not indefinitely.

Gruenther, who had just come from seeing Selwyn Lloyd, said that what the NATO military authorities required was a political view from each government on defence strategy. If they could get this, they could press ahead with their military examination and be ready, he thought, to report to the Council by October. He had expressed this view in Washington where, incidentally, he had, so he said, received fairly rough handling from congressional committees on defence policy. I told him that my own view was that if a military examination was completed by October that would be satisfactory, and we should be able to postpone a Council meeting until soon after that date. I suggested he talk over the whole question with Ismay when he got to Paris, but keep in mind that the situation in London now, in regard to premature or unilateral action, was much better than Ismay might think on the basis of information he had received a couple of weeks ago.

I think this whole business is now "on the rails" but a lot of hard thinking on defence policy will have to be done by the NATO countries within the next few months. Some far reaching decisions will then have to be taken and these may vitally affect NATO's future as well as the defence policies of its members.