246. Record of Cabinet Meeting1
[Here follows discussion unrelated to Indonesia.]
Secretary Rusk (1:00–1:02)
The Secretary introduced Ambassador Marshall Green by recalling the shrunken influence of Communist China in Asia. Chinese Communism is no longer seen “as the wave of the future.” “Just three years ago, we feared the axis of Chen Yi, Subandrio and Bhutto (Pakistan) … now all three are gone.”
The spectacle of Indonesia rejecting Chinese Communism, combined with our stand in Vietnam, has been vital to the erosion of Peking’s influence. “We have been fortunate to have in Indonesia at this critical hour one of the real experts, Ambassador Green.”
Comment by the President
Had been so impressed with Ambassador Green’s personal report that “I wanted to share it with you.”2
Marshall Green, Ambassador to Indonesia (1:02–1:12)
The Ambassador based his report on the briefing paper attached at Tab A.3 The following were among the points emphasized:
[Page 531]Indonesia is a rich and strategic nation of 200 million people.
- —No nation in recent history “has undergone a greater transformation than Indonesia.”
- —Indonesia’s “New Order” government has thwarted Communist takeover; ended confrontation; sought friendly relations with its neighbors; rejoined the UN; banned the Communist Party; banished Sukarno. (“He is a forlorn figure, down to his last wife and last kidney.”)
- —Less dramatic, but still significant, are Indonesia’s domestic rehabilitation efforts; conversion to a free market economy; IMF-endorsed stabilization program; new family planning and food production initiatives; new Civil Action programs by the military; a 45% slash in military budget; strong efforts to encourage foreign investment.
Indonesian Problems Remaining
Despite Indonesian progress and opportunities, problems remain. “They are typical of what you would expect from 20 years of mismanagement by Sukarno on top of the Dutch tradition.”
- —Weak political institutions.
- —Endemic corruption, mismanagement and inefficiency.
- —Dangers of creeping militarism.
- —Anti-Chinese racialism. “I have travelled widely in the country and you can see why 32% of inner island shipping is not operating… . The harbors are blocked… . There is just 22 million dollars available to educate 40 million students… . But Indonesia does now have moderate and pragmatic leaders.”
Comment by the President
Invited the Ambassador to describe the Indonesian budget. “I want the Cabinet to hear about that.”
The Ambassador gave Indonesia’s total budget as “500 million dollars for 110 million people.”
U.S. Policy for Future
The “New Order” government is determined to stabilize their nation. “We can and must help them.”
“They have great resources. Oil, minerals, timber, fisheries… . But as well as they are doing, Indonesia is now really flat on its back.”
The United States should continue its present “multilateral approach to assistance.” We should continue or increase our partnership efforts with the IMF, IBRD, ADB, UN—emphasizing, especially, the opportunities for private investment in the Indonesian future.
“This is Indonesia’s critical hour of need… . We cannot neglect nor fail them now… . The security of all Asia is affected… . Our sacrifices in Vietnam avail little if we do not take strong and swift steps to foster the growth and strength which the new Indonesia can achieve.”
[Page 532]The Ambassador concluded his report by reading the following excerpt from a cable received this morning from AmEmbassy Djakarta:
“Malik believes just as well to keep heat on Hanoi. If after U.S. elections negotiations should take place prospects for satisfactory settlement would be enhanced. Malik made clear that he believes our position is correct at this time; he does not think we should stop bombing of North unless there is some indication that other side will negotiate in good faith.”
Ambassador Green characterized this report as “an interesting and encouraging evolution in Malik’s attitude.”
Comment by Secretary Rusk
Recalled Malik’s meetings with several Foreign Ministers in New York as equally indicative of an improved attitude toward U.S. commitment in Vietnam and Asia.
[Here follows discussion unrelated to Indonesia.]
- Source: Johnson Library, Cabinet Papers, Cabinet Meeting, 10/18/67, [1 of 3]. Confidential. There is no drafting information on the memorandum.↩
- Green met with President Johnson on October 12 from 1:15 to 1:35 p.m. (Ibid., President’s Daily Diary) No record has been found of their discussion, but Green described it briefly, as well as his subsequent briefing of the Cabinet, in his Indonesia: Crisis and Transformation, 1965–1968, pp. 109–110.↩
- Attached but not printed.↩