(c) crown copyright Catalogue Reference:CAB/129/76 Image Reference:0049 The circulation of this paper has been strictly limited. It is issued for the personal use of TOP SECRET Copy N o . . . ^ . C J ? o ( 5 5 ) 99 27th July, 1955 CABINET FOUR-POWER TALKS Note by the Secretary of the Cabinet A t the direction of the P r i m e Minister I circulate the attached records of conversations which took place at G e n e v a , outside the Conference r o o m , for the personal information of m e m b e r s of the Cabinet. T h e s e records should be returned to m e w h e n they h a v e b e e n read ' B (Signed) N O R M A N Cabinet Office, S.W.1 27th July, 1955. \ BROOK PALESTINE I h a d a t a l k w i t h t h e P r e s i d e n t f o r t h r e e - q u a r t e r s of a n h o u r this afternoon,, W e b e g a n w i t h s o m e d i s c u s s i o n of A l p h a , w h e n I g a v e h i m a c o p y of t h e a t t a c h e d m e m o r a n d u m ( C , P . ( 5 5 ) 7 5 ) . The P r e s i d e n t r e a d i t c a r e f u l l y a n d s a i d t h a t h e w o u l d of c o u r s e c o n s i d e r it. He had not quite understood that our two countries w e r e not in complete a g r e e m e n t on the line to be taken. I said that we had been in e n t i r e a g r e e m e n t a n d s t i l l w e r e a s t o t h e t e r m s of a p o s s i b l e s e t t l e m e n t but h i t h e r t o we had a l s o wanted to negotiate it s e c r e t l y with the two sides. Admittedly we had not made much p r o g r e s s . Now the proposal w a s for a public statement by the United States. This raised important considerations. I felt in s o m e doubt about how the A r a b s would t a k e t h e s t a t e m e n t a n d o f c o u r s e t h e m a i n b u r d e n i n t h a t p a r t of t h e w o r l d i f anything went w r o n g would fall upon u s , since we h a d f o r c e s and i n t e r e s t there. O n t h e o t h e r h a n d I a l s o u n d e r s t o o d h o w m u c h t h e p r o b l e m of the Jews loomed in A m e r i c a n domestic politics. The President said that the latter was true. There was no Arab Lobby,nor I interjected, a British Lobby either * The P r e s i d e n t laughed and said we had not to trouble about that. The only reaction t h e r e against v e r y friendly relations between Britain and the United States c a m e f r o m the s m a l l but vocal Irish group. Reverting to the Jewish situation the P r e s i d e n t said that he wondered whether it was r e a l l y n e c e s s a r y to take a decision to m a k e such a statement now. He would like to think the whole m a t t e r o v e r , and we could talk about it again b e f o r e I left, 2. A s to the off-shore p u r c h a s e s he would tell m e frankly his difficulty. If w e c o u l d g i v e a l i t t l e h e l p , h o w e v e r s m a l l , i n t h e s e m a t t e r s ourselves his task would be e a s i e r . W h e n e v e r h e a s k e d for a p p r o p r i a t i o n s from Congress they w e r e apt to complain that nobody else seemed to be taking a share. He did not want to put undue b u r d e n s on us a t a t i m e w h e n w e w e r e j u s t g e t t i n g o u r h e a d a b o v e w a t e r b u t if h e c o u l d find s o m e w a y o f s h o w i n g t h a t w e o u r s e l v e s w e r e a l s o b e a r i n g p a r t of t h e b u r d e n e c o n o m i c a l l y he would be in a m u c h s t r o n g e r position to h e l p . I under­ stood h i m to add that C o n g r e s s had been m o r e reasonable recently about g i v i n g h i m l a t i t u d e i n t h e u s e of t h e a p p r o p r i a t i o n s t h e y h a d v o t e d . F i n a l l y t h e P r e s i d e n t a s k e d m e if I k n e w h o w l a r g e a n o r d e r f o r t a n k s this would b e , I s a i d I did n o t k n o w , b u t I i m a g i n e d s o m e t h i n g in t h e o r d e r of 1 0 0 w o u l d b e q u i t e i m p o r t a n t i n t h e s c a l e . The President r e p l i e d that in that c a s e h e felt s u r e they could do s o m e t h i n g . He would get into t o u c h with St&sean who w a s s t i l l in P a r i s o r with s o m e o t h e r authority to t r y to get m e an a n s w e r before I left. I said I should be g r a t e f u l f o r t h a t b e c a u s e I w a s q u i t e s u r e t h a t if w e w e r e g o i n g t o a c t i n t h i s m a t t e r t h e s o o n e r w e c o u l d r e a c h a g r e e m e n t and, t h a t t h e s o o n e r the Iraqis knew that the tanks w e r e coming the better it would b e . A.E.' 17th J u l y , 1955 GERMANY In the course of the conversation alone with the President this afternoon w e reviewed the discussion that had taken place with Monsieur F a u r e and the three Foreign Secretaries in the morning,, T h e President said that h e thought he h a d persuaded M o n s i e u r F a u r e not to refer to the question of the demilitarised area except in general t e r m s , I said that the f o r m in which M o n s i e u r F a u r e had phrased it would have created a l a r m and despondency a m o n g the N . A . T . O Powers, I added that I agreed and that w e h a d to be careful not to propound precise boundaries at this stage or w e should be held to anything w e offered, I thought the really important issue at this Conference w a s G e r m a n y , I hoped that he and I would press together strongly to try to m o v e the Russians on this. T h e President cordially agreed. 0 A.E. 17th July. 1955 W h e n I w a s alone with the President this afternoon w e h a d discussions at s o m e length on the F a r Eastern situation. I told h i m that I thought that there w a s n o i m m e d i a t e danger of w a r in E u r o p e . T h e President agreed. O n the other hand I w a s deeply concerned at the position in the F a r E a s t , especially in respect of the off-shore islands cf Q u e m o y and Matsus. W h a t e v e r v i e w the P r e s i d e n t s advisers might h a v e about N e h r u it w a s the fact that the Indians had w o r k e d hard to persuade the Chinese to m o d e r a t e their attitude. T h e President indicated that h e thought this m i g h t well be so in respect of N e h r u , but m a d e it plain that h e had not m u c h use for Krishna M e n o n ' s methods,, H e thought that the latter concealed intellectual arrogance under the cloak of humility. I said that as I h a d explained to M r . Dulles in times gone b y one h a d to look at the p r o b l e m of the off-shore islands as P e k i n g might see it. If I w a s C h o u e n - L a i I should not w i s h to see the A m e r i c a n s out of Q u e m o y and M a t s u s . 1 should say to myself that as long as the A m e r i c a n s w e r e there they w e r e to s o m e extent at m y m e r c y I could put t h e m in a d i l e m m a at a n y t i m e . If I take or threaten to take Q u e m o y and M a t s u s I k n o w the A m e r i c a n s will h a v e to c o m e to the help of Chiang kai-Shek, in which event they would not be supported by world opinion, or they will have to leave h i m to his fate which would b e a b l o w to their authority,. Therefore, speaking f r o m our point of view, it s e e m e d to m e that the United States would b e m u c h better placed in every w a y both locally and before world opinion if Chiang kai-Shek's forces w e r e withdrawn f r o m Q u e m o y a n d M a t s u s . 0 2. T h e President said that h e did not dispute this at all. N o subject h a d given h i m m o r e concern and h e only wished h e could see a clear w a y through the difficulties. T h e y w e r e h o w e v e r very real. H e h a d to face the fact that h e m u s t count on Chiang kai-Shek to defend F o r m o s a . Chiang kai-Shek encouraged by the A m e r i c a n s at the time of the Korean, w a r had built u p strong forces in Q u e m o y and M a t s u s . H e h a d tried to persuade h i m to at least reduce these forces to relatively w e a k outposts w h i c h could inflict loss on the e n e m y if attacked and could then have b e e n withdrawn without disaster to Chiang kai-Shek's prestige. H o w e v e r - Chiang had not b e e n willing to do this. T h e President h a d sent a mission over to F o r m o s a to try to persuade h i m but h e did not think that the mission h a d done its task v e r y well. A t a n y rate it had not succeededo H e h a d even considered the possibility of inviting Chiang to Washington and trying to see w h a t h e could d o himself. H e felt the difficulty of this also, I said I understood his hesitation about inviting Chiang to Washington a"s such a n event would certainly h a v e wide publicity, with perhaps s o m e unhelpful repercussions, I thought that Chiang probably did not w a n t to accept the P r e s i d e n t s advice because, a m o n g other things he would not b e sorry to see the United States embroiled with C o m m u n i s t China T h e President said that there w a s still the p r o b l e m of the defence of F o r m o s a . T h e United States o w e d Chiang kai-Shek nothing but h e w a s necessary to the defence of F o r m o s a . W h e n I mentioned that'I understood the F o r m o s a n s themselves w e r e not sympathetic to the C o m m u n i s t s , the President said that this w a s true but if once Chiang kai-Shek disappeared there might not be m u c h as a n alternative to Peking. v 0 3 W e continued to discuss the topic for a considerable time and the President repeatedly assured m e of his concern about the position and his anxiety to be quit of the islands if h e could contrive it. A t one point h e said that if h e could put t h e m under the sea h e would gladly d o so. I said that m y o w n impression w a s that Chiang kai-Shek*s withdrawal f r o m Q u e m o y and M a t s u s would have n o adverse effect on either his authority or that of the United States in the F a r East. The s a m e would not be true of course of a withdrawal under pressure f r o m Formosa. T h e President said this might be right a n d that he w a s glad of our talk together on this difficult subject. I said that I had raised it because it s e e m e d the one issue o n w h i c h our two countries could so easily be divided and h e would k n o w h o w sincerely anxious I w a s to avoid anything so dangerous. T h e President agreed and said that his relations with Great Britain w e r e quite exceptional. N o other country w a s in the s a m e position except his neighbour C a n a d a , T h e President asked m e to give h i m a n opportunity of thinking over w h a t I had said and to talk to M r . Dulles about it w h o h e assured m e w a s also m u c h m o r e concerned on this matter than the public generally thoughto' After that h e would certainly wish for another opportunity for u s to talk together on the matter while h e w a s still in G e n e v a , 0 A.E. 17th July. 1955 In the course of our talk at dinner tonight I r e m a r k e d to M a r s h a l Bulganin that though the situation in E u r o p e w a s difficult it w a s not dangerous. H e cordially agreed and added that the possibility of w a r in E u r o p e w a s so far a w a y it w a s hardly worth talking about. H e agreed h o w e v e r that the F a r Eastern situation w a s m u c h m o r e anxious. H e spoke of F o r m o s a and the dangers there,, I said that Q u e m o y and M a t s u s worried m e m u c h m o r e . Krushchev interjected h e r e that the Chinese had b e e n v e r y patient. H e did not think that the'Russians would have b e e n so patient, I replied that h e underestimated his o w n statesmanship. T h e position of Q u e m o y and M a t s u s w a s v e r y difficult for the A m e r i c a n s a n d for everybody concerned. T h e A m e r i c a n s might wish Chiang Kai-shek to reduce his forces on the islands. It did not follow f r o m that that they could c o m p e l h i m to do so. W e w e r e not always able to get our friends to do w h a t w e wished. T h e Russians appeared to accept this but they w e r e clearly still anxious about the Far E a s t e r n situation. The Foreign Secretary suggested that the A m e r i c a n s would b e v e r y happy if Q u e m o y and M a t s u s w e r e sunk under the sea. This suggestion appeared to receive universal approbation except, possibly, w e all admitted f r o m a n absent C h o u E n - L a i . T h e Russians c o m m e n t e d the m a s t e r of the h o u s e is absent. A.E. \ 19th July, 1955. GERMANY M a r s h a l Bulganin and K r u s h c h e v , with Molotov, Z h u k o v and Malik, c a m e to dinner with the Foreign Secretary and myself tonights During dinner I sat between Bulganin and K r u s h c h e v and had a frank and intimate talk with the f o r m e r , w h o appeared to wish to give a clear account of his genuine preoccupations. After s o m e preliminary talk about the w a r y e a r s , Bulganin plunged into the p r o b l e m of G e r m a n y . H e explained on familiar lines h o w real w e r e Soviet fears of a G e r m a n recovery. A l m o s t every family in Soviet Russia, including his o w n , h a d suffered s o m e personal loss I replied that w e in Britain h a d also n o reason to feel tenderly to the G e r m a n s after the experience of two w a r s . But one had to look to the future a n d whatever the fear of G e r m a n y h a d b e e n , I could not believe that in this nuclear age G e r m a n y could really be a formidable danger to Russia, Bulganin h o w e v e r would not altogether accept this. H e admitted that G e r m a n y might not b e able to m a k e h y d r o g e n b o m b s , but after all they could b e given to t h e m . W e h a d s o m e talk about these n e w w e a p o n s and their possible consequences for the world. Bulganin h o w e v e r maintained that the p r o b l e m w a s for the present, and would be for s o m e time to c o m e , one which only concerned the United States^ Russia and ourselves. H e did not foresee a future w h e n the smaller P o w e r s would b e able to m a k e the b o m b . I argued that whatever the Soviet fears of G e r m a n y , w e w e r e all agreed that s o m e time G e r m a n y m u s t be united and m y suggestions h a d b e e n based on a desire to m e e t w h a t I well understood to be Russian fears. Bulganin said h e thought that s o m e of our suggestions w e r e important and m o r e than once in our conversation e m p h a s i s e d the part that w e would have to play in trying to find a solution. W e discussed the possibility of reaching s o m e a g r e e m e n t about forces and a r m a m e n t s in G e r m a n y and neighbouring countries and s o m e f o r m of supervision to control it. H e thought this worth examining, but said that he h a d not thought about it, I advised h i m to give it consideration. W e also discussed a Security P a c t and I told h i m I thought it a pretty hopeless proposition to try to create a P a c t for all E u r o p e . H o w for instance could Tito and F r a n c o be a c c o m m o d a t e d together ? H e laughed and said that perhaps this w a s not necessary; m a y b e the Soviets cast their nets too wide, F e r h a p s it would b e possible to f o r m s o m e P a c t b e t w e e n us which covered at least a part of E u r o p e . 0 2. In later discussion, w h e n K r u s h c h e v w a s present, the suggestion w a s the N . A . T . O . P o w e r s maintaining their organisation and the W a r s a w P o w e r s maintaining theirs, and that all these should join the E u r o p e a n P a c t with the addition of s o m e other countries. They gladly accepted that this should include the United States and Canada,, 3 After w e h a d discussed these matters for s o m e time, Bulganin said that h e wanted to say something to m e which h e had said to nobody else. It w a s really not possible for his G o v e r n m e n t to return to M o s c o w f r o m this Conference having agreed to the i m m e d i a t e unification of G e r m a n y , T h e y w e r e a united G o v e r n m e n t and reasonably solidly based in the country but this w a s something that Russia would not accept and if they w e r e to agree to it, neither the A r m y nor the people would understand it and this w a s n o time to w e a k e n the Government. T h e people would say this w a s something Stalin would O n this therefore he simply could not m e e t u s never h a v e agreed to 9 0 c i\)0 4. In further discussion with h i m , and later with K r u s h c h e v , it e m e r g e d that while they could not a g r e e to the unification of G e r m a n y n o w , they m i g h t be prepared to consider t e r m s of reference for the Foreign Secretaries, which would contemplate such unification together with other compensating conditions. A t Bulganin's request I repeated after dinner to K r u s h c h e v the kind of directive I hoped w e might give the Foreign Secretaries,, This would consist oi.%" (1) a n instruction to study the unification of G e r m a n y , having regard to the security of all concerned; (2) study of a security pact for E u r o p e , or a part of itj (3) study of the limitation of forces and a r m a ­ m e n t s in G e r m a n y and in the countries neighbouring G e r m a n y , and (4) study of the possibility of creating a demilitarised area. Both Bulganin and K r u s h c h e v appeared to agree that such t e r m s of reference w e r e acceptable ones for the Foreign Secretaries, but they said it w o u l d b e necessary to draft and study t h e m . Molotov being present b y this t i m e , I suggested that a s an expert d r a u g h t s m a n he should try his h a n d at the task. 5. In a long experience of talks with Russians, I think that this w a s the m o s t important and certainly the frankest conversation that I have known. I have not thought it useful to repeat the m a n y c o m p l i ­ m e n t s to Britain a n d references to a personal part in relations in years g o n e by. All this could properly b e ascribed to a desire to divide us f r o m the A m e r i c a n s . But I do not think that this would be a complete explanation. It is rather m y impression that they regard us as the only possible bridge between themselves and the United States and that they are anxious that this bridge should be built. The F r e n c h w e r e never mentioned, the United States w e r e always referred to with respect, and as being our friends - f r o m w h o m w e should not be divided. E a c h time I mentioned C a n a d a , her position w a s immediately accepted,, Nehru's visit w a s frequently mentioned with satisfaction. A.E. U12 1. THE W O R K OF THE CONFERENCE, 2. PALESTINE T h e Foreign Secretary a n d I h a d breakfast with the President this m o r n i n g , w h e n M r . Dulles and M r . Dillon A n d e r s o n w e r e also present, "I began b y giving the President at his request a n account of our discussion with the Russians at dinner last night. H e s e e m e d encouraged b y the progress w e h a d m a d e and repeated this as I w a s saying good-bye to h i m a n hour and a half later. 2. O u r talk dealt almost entirely with the w o r k of the Conference and the President s h o w e d himself m u c h m o r e keen to get positive results. After canvassing various possibilities w e agreed that s o m e i m m e d i a t e a g r e e m e n t to apply supervision to the forces of E a s t and W e s t in a part of E u r o p e would b e the best tangible result w e could hope for. T h e president suggested that there might for instance be such joint inspection to a depth of 100 miles or so on either side of our existing line in G e r m a n y . I suggested that it would be good to get G e n e r a l Gruenther's v i e w of all this and the President thought this a n excellent idea and is sending for h i m and I understand for A d m i r a l Radford as well. 3. W e also agreed that at luncheon today h e would press Z h u k o v on the importance of s o m e concrete result e m e r g i n g f r o m the Conference and that I would take the s a m e line with Bulganin, with w h o m I a m to lunch. 4. In general the President s h o w e d himself impressed by the change in climate which h e really believes h a s c o m e over Soviet opinion. W e both agreed h o w e v e r that an a g r e e m e n t to i m m e d i a t e action in respect of the unity of G e r m a n y w a s nc?b to b e got here. It m i g h t well b e beyond the p o w e r of the Soviet rulers to c o m e so far so soon after the a g r e e m e n t on Austria a n d visit to Yugoslavia and m a k i n g a gesture of friendliness to W e s t e r n G e r m a n y , 5. A t the conclusion of our discussion w e spoke for a f e w minutes about A l p h a and i m p r e s s e d o n our A m e r i c a n friends the importance of giving Nuri s o m e tangible indication of our friendship and our desire to help h i m in the f o r m of the tanks w h i c h h e had so long b e e n waiting for. A separate telegram is being sent about this. 6. W e are to r e n e w our 8.30 breakfast t o m o r r o w in order to discuss F a r Eastern affairs, which w e h a d n o t i m e to reach today. A.E.. 20th July, 1 9 5 5 0 If) 4 THE FAR EAST A t the P r e s i d e n t s suggestion M r . Foster Dulles a c c o m p a n i e d by M r Phleger c a m e to breakfast this m o r n i n g with the Foreign Secretary and m y s e l f in order to discuss the F a r Eastern situation. T h e o u t c o m e w a s not encouraging. M r . Dulles w e n t once again over the old ground saying that the Chinese C o m m u n i s t s w e r e impatient; w h y did they alone of the nations recently embroiled expect to have everything c o m e right for t h e m at once ? K o r e a w a s still divided, so w a s G e r m a n y . W h y should the Chinese C o m m u n i s t s expect to have everything rounded off for t h e m at once ? He referred to the Offshore Islands. I said a m o n g s t other things they w e r e in a position to round those off for themselves. T h e y had the p o w e r to d o it. M r . Dulles said h e supposed that w a s true. A t the s a m e time if only the Chinese would act reasonably for a year or t w o they would find the whole climate of world opinion changed and their admission to the United Nations for instance would certainly take place. I explained that being a revolutionary p o w e r and waiting for a year or t w o might not greatly appeal to t h e m . T h e Foreign Secretary then asked w h a t would in fact h a p p e n if the Chinese did act in the m a n n e r I h a d suggested they could. M r . Dulles said that he could not tell but if w e wanted his guess it w a s this. If Q u e m o y and M a t s u s w e r e attacked and the whole thing w a s over in a short t i m e , say in a day or t w o , there would probably be n o reaction in the United States. It w a s certainly not the U S . G o v e r n m e n t s intention to act at once. If on the other hand the fighting w a s protracted and for instance a gallant resistance w a s put u p by Chiang Kai-shek's m e n as at D i e n Bien P h u , the d e m a n d for intervention in the United States would b e v e r y strong and his o w n v i e w w a s that as a result the United States would act. I would r e m e m b e r h o w at the time of Dien Bien P h u the pressure then of A m e r i c a n public opinion for action had been strong and Indo-China w a s m o r e remote. I said the value of the intervention w a s also considerably in doubt, which he accepted. I said that the situation h e put before u s w a s a very dangerous one. It s e e m e d terrible that a w a r m i g h t depend on h o w long Chiang Kai-shek's m e n held out on these islands, for w e understood the difficulty of A m e r i c a n military intervention there M r . Dulles said that the position w a s undoubtedly highly dangerous and w e might be said to b e living over a volcano. O n the other h a n d the United States G o v e r n m e n t had done everything possible to persuade Chiang Kai-shek to get out of the Offshore Islands and h e would not. T h e y had sent A d m i r a l Radford and M r , R o b e r t s o n o n a special rnission T h e y had used every possible a r g u m e n t and they h a d failed,, After the meeting had b r o k e n and a s I w a s escorting M r . Dulles to his car h e said that he begged m e to believe that the A m e r i c a n s had done everything they possibly could to persuade Chiang but that h e w a s i m m o v a b l e . J7 * said that I h a d been v e r y m u c h struck by something which the President h a d said to m e at our last talk$ n a m e l y that the dangers could b e v e r y m u c h decreased and the military position of Chiang strengthened if instead of holding these Onshore Islands with 50,000 m e n or whatever the n u m b e r n o w w a s he held t h e m m e r e l y as a n outpost. H e could m i n e t h e m and m a k e t h e m unpleasant to take in any other w a y h e liked, but if h e held t h e m as a n outpost and the Chinese C o m m u n i s t s did attack, Chiang's prestige would not be involved, and still less that of the United States. This s e e m e d to m e to m a k e political and military sense because the w e a k n e s s of the present position w a s that Chou-En-lai by attacking could face the United States with a n appaHing d i l e m m a , either to intervene for their friends with consequences no-one could foresee, or to leave their friends to their fate before the e e 0 - 8 0 world M r . Dulles said that the President h a d spoken to h i m about his outpost idea and he k n e w that h e w a s v e r y keen on it but so far he h a d not been able to sell it either to the Chiefs of Staff or to Chiang Kai-shek, I said that nonetheless it s e e m e d to m e to m a k e sense. e 2 I asked M r , Dulles if h e thought w e could d o anything in the circumstances with the situation so dangerous. I thought I would take the opportunity tonight w h e n dining with the Russians to speak to t h e m about that danger. M r . Dulles said y e s , he hoped that I would and that should aid things with C h o u En-lai. Probably w e could not do very m u c h ourselves, but our Asiatic friends should do all they could to persuade C h o u En-lai to wait. I said that w a s just exactly w h a t they had b e e n doing and I thought that w a s w h y the position had b e e n quiet but I doubted v e r y m u c h if it would b e held in that w a y indefinitely. M r . Dulles said w e m u s t just try to carry the b a b y alongo In time the matter would solve itself. A l r e a d y in F o r m o s a the a r m y w a s changing character. It w a s being m o r e and m o r e c o m p o s e d of young F o r m o s a n s w h o did not w a n t to return to the mainland and if that developed the Offshore Islands would matter less and in another t w o or three years something might h a p p e n to m a k e that position soluble. In the m e a n w h i l e , by the talks they h a d proposed at G e n e v a the A m e r i c a n s h o p e d s o m e a r r a n g e m e n t s could b e arrived at which would be helpful not only about the prisoners but perhaps also about restraint on attacks o n shipping and other a r r a n g e ­ m e n t s of that kind which would reduce the danger of incidents. 0 A.E. 22nd July, 1955. \ After the dinner given by the Soviet Delegation on 22nd July 1 had s o m e conversation with M M , Bulganin and K h r u s h c h e v about the F a r East. M a r s h a l Z h u k o v w a s also present, but took n o part in this conversation. M M Bulganin and K h r u s h c h e v said that they had been, greatly i m p r e s s e d b y w h a t they h a d seen during their visit to C h i n a T h e n e w leaders there w e r e m e n to be reckoned with. Both M a o tse-Tung and C h o u En-lai w e r e strong characters, but m e n of balanced j u d g m e n t w h o w e r e unlikely to take hasty or ill-considered action. T h e r e g i m e w a s firmly established; m u c h material progress w a s being m a d e ; and in ten years or so China would b e a strong m o d e m State. 4 0 2. M e a n w h i l e , their revolution w a s young. It w a s natural therefore that they should resent Chiang*soccupation of Q u e m o y and the M a t s u s so near their coast-line, a n d United States protection of Chiang in F o r m o s a . It w a s natural, too, that they should w i s h to take C h i n a s seat in the United Nations. O n that point they certainly h a d right o n their side. 1 3. I said that President E i s e n h o w e r w a s doing his best to keep his public opinion under control o n the subject of Q u e m o y a n d the Matsus. T h e Russians should, h o w e v e r , recognise his difficulties. This w a s a subject o n which emotions ran high in the United States. O u r o w n interests in China h a d b e e n mainly c o m m e r c i a l : w e h a d traded there for a long t i m e , and over the years h a d earned a good c o m m e r c i a l return for w h a t w e had invested. B u t the A m e r i c a n s , during the w a r and since, had poured m o n e y into China; and the average A m e r i c a n n o w felt that the Chinese had bitten the h a n d that fed t h e m . A s a result the A m e r i c a n s w e r e specially sensitive about the present situation. T h e President w a s doing his best, in spite of this, to c a l m things d o w n and to counsel patience. If h e w e r e given W e r e the Chinese prepared to b e m o r e t i m e , all might yet be well. equally patient? 4 M . K h r u s h c h e v said that traditionally the Chinese w e r e a patient people. H e believed that they would not take any r a s h action at the present time. It w a s to b e hoped, h o w e v e r , that s o m e fruitful result would c o m e f r o m the meetings w h i c h w e r e to be held in G e n e v a b e t w e e n the A m b a s s a d o r s of the United States and China. 0 I said that these discussions should help. T h o u g h they 5 would begin with such questions as release of prisoners, they m i g h t well b r o a d e n out to cover s o m e of the m o r e substantial issues. B A.E. 23rd July? 1 9 5 5 0