175. Memorandum of Discussion at the 395th Meeting of the National Security Council0

[Here follow a list of participants and agenda item 1.]

2. Significant World Developments Affecting U.S. Security

[Here follows discussion of an unrelated subject.]

In Indonesia, Mr. [Allen] Dulles stated that President Sukarno had been holding talks with Indonesian political leaders with respect to the re-organization and expansion of the Indonesian Parliament in keeping with Sukarno’s concept of “guided democracy”. According to Sukarno’s present plans, one-half of the members of the Parliament would be appointed by the government and one-half would be elected. Mr. Dulles thought that such a proposal might not be bad inasmuch as he certainly could not look forward, he confessed, to full and free elections in Indonesia with so many disorganized parties on the political scene. Moreover, the Indonesian Communist Party strongly opposed the government’s plan for appointing one-half of the members of the new Parliament.

There were also reports from Indonesia that Sukarno was not at all well and was suffering perhaps from a kidney ailment. Mr. Dulles thought that Sukarno might wish to come to Walter Reed Hospital for surgery. In this connection he noted that Prime Minister Sarit of Thailand would presently be operated on again in Bangkok by physicians from Walter Reed. Sarit was a very sick man indeed.

Mr. Dulles then pointed out that the Indonesian Army was continuing to play a very strong political role in Indonesia. Meanwhile, extensive guerilla warfare went on in Sumatra and North Celebes. There were approximately 10,000 armed rebels in Sumatra and 5,000 in North Celebes. In view of these facts it seemed curious to Mr. Dulles that the Indonesian rebels had not done better when they had a chance to fight in an organized way against the forces sent from Java. We ourselves were not giving any aid to the rebels although they seem to be getting some assistance from Nationalist China.

The President inquired whether, if Sukarno were to succeed with his plans for “guided democracy” and excluded the Communists from a significant voice in the Parliament of Indonesia, these moves would tend to end the rebellion in the outer islands? Mr. Dulles replied that he [Page 327] doubted that this would occur unless Sukarno could bring himself to deal directly with the rebels. So far he has refused to do this despite urgings by us and by the British. Meanwhile, the rebel leaders, who included some of the most able men in Indonesia, were still up in the hills. They were probably now ready to negotiate but Sukarno won’t hear of it.

Mr. Dulles concluded by pointing out that significant Soviet Bloc military aid to Indonesia was continuing. Likewise, the economic situation in Indonesia was worsening and inflation was increasing.

[Here follows the remainder of this agenda item.]

3. U.S. Policy Toward Indonesia (NSC 5518;1NSC 5901;2 Memo for All Holders of NSC 5901, January 21, 1959;3NSC Action No. 1788;4 Memo for NSC from Executive Secretary, subject, “Special Report on Indonesia:, dated September 25, 1957;5SNIE 65–58;6 Memo for NSC from Executive Secretary, same subject, dated January 26, 19597)

Mr. Gray briefed the Council on the contents of the proposed new policy statement on Indonesia. (A copy of Mr. Gray’s briefing note is filed in the Minutes of the Meeting and another is attached to this Memorandum).8 When in the course of his briefing, Mr. Gray referred to the problem of West New Guinea and to the fact that the new policy recommended continuation of the U.S. neutral stand on the West New Guinea issue, he called on Secretary Dulles for comment.

Secretary Dulles observed that of course the trouble in West New Guinea between The Netherlands and Indonesia was highly complicated and involved both Dutch domestic policy and the foreign policies of several NATO nations. The present government of The Netherlands has hitherto taken a very strong line with respect to holding on to West New Guinea. Since West New Guinea, continued Secretary Dulles, had [Page 328] no ascertainable value at the present time, it seemed to him that the Dutch Government was paying a very high price for maintaining prestige. The really useful Dutch investment had been in Indonesia and this was now wiped out, at least temporarily. Moreover, there was a considerable element in The Netherlands, notably among Dutch businessmen, who felt that the policy of the present government of The Netherlands on the West New Guinea issue was silly.

Reiterating that West New Guinea, so far as was known, was pretty nearly valueless, Secretary Dulles did not discount the possibility of a change in the policy of The Netherlands toward West New Guinea. While this might be hopeful, it should be remembered that Australia was even more violently opposed than The Netherlands to turning over West New Guinea to the Indonesians. For our part, we have made quite clear to the Indonesians that if they should attempt to seize West New Guinea by force, the U.S. would be strongly opposed in principle. We have also told the Dutch that in the event that West New Guinea were attacked by the Indonesians, we would at least give them moral and perhaps logistical support although we would not support them with our own military forces. Secretary Dulles added a statement of doubt that the Indonesians would actually move against West New Guinea with armed forces.

In conclusion Secretary Dulles stated that the government of The Netherlands was in a very delicate and difficult position with respect to this dispute and as Mr. Gray had pointed out in his briefing, the Dutch have lately been putting heavier pressure on the U.K. than on the U.S. to obtain support for their point of view with regard to West New Guinea. Nevertheless, the British stand approximately where we stand on the West New Guinea issue and while they may provide the Dutch with moral and logistical support, they are not likely to take military action to support the Dutch, if the Indonesians attacked West New Guinea.

Secretary Quarles said he wished to point out that from the point of view of Defense, he strongly supported the State position of neutrality on the West New Guinea dispute. Mr. Quarles commented that in the course of his recent talks at The Hague, he had observed that the Dutch were taking the possibility of an Indonesian attack on West New Guinea very seriously and were diverting military forces to the defense of West New Guinea even though such resources were needed to discharge Holland’s NATO responsibilities. Secretary Quarles added that the Dutch were much annoyed at the military assistance which we were currently providing to Indonesia. In response to these expressions of irritation, Secretary Quarles had pointed out our big objective of trying to prevent a Communist take-over in Indonesia.

[Page 329]

With respect to this last point, Secretary Dulles said that the Dutch Foreign Minister Luns had said he would rather have Indonesia go Communist because then one could more clearly move against it.

Mr. Allen Dulles pointed out that while we knew very little about the West New Guinea area, we would presently have on hand a report of what has been going on in the area in recent months.

The President complained that he simply could not understand why any nation except Australia should be very concerned about West New Guinea. Australia was obviously concerned because of geographical proximity.

At this point Mr. Gray continued with his briefing of NSC 5901 and pointed out after he had dealt with the Financial Appendix, that the Joint Chiefs of Staff had expressed some concern about the apparent lack of urgency in carrying out our military assistance program for Indonesia. He called on Admiral Burke who was Acting Chairman of the Joint Chiefs of Staff to comment on this matter.

Admiral Burke explained that the concern of the Joint Chiefs of Staff resulted from the fact that in the past eight or nine months the U.S. has slowly been pulling Indonesia out of the clutches of the Communists, chiefly through the instrumentality of the Army Chief of Staff, General Nasution. The Chiefs were only concerned that this process continue and that we keep the ball rolling and not destroy Nasution or weaken him by not keeping up to schedule with our military assistance.

At this point Secretary Dulles undertook a general defense of the U.S. policy with respect to supporting the rebellion in the outer islands while it seemed to have some chance of success and withdrawing our support at a later time. By and large, [less than 1 line of source text not declassified], Secretary Dulles believed that we had played the game pretty well and our policy may now work out successfully. He said he certainly did not dissent from Admiral Burke’s views as to the need for an effective military assistance program in order to win the confidence of the non-Communist elements in Indonesia. The delays which had occurred in the delivery of our military assistance to the Indonesians were the result of the need in which we found ourselves to keep the Dutch in line. To do this was often a difficult task but we must at least try to keep the Dutch tolerant of what we are doing to assist Indonesia. Ultimately, thought Secretary Dulles, the Dutch will understand and acquiesce in our program for assisting Indonesia.

The President did not seem wholly convinced by Secretary Dulles’ arguments in defense of prior U.S. policy except as he said that we were on a better horse now than we had been during the organized rebellion in the outer islands.

[Page 330]

On this point Mr. Allen Dulles commented that a forceful reduction now of rebel guerilla activity in the outer islands would provide Sukarno with a measure of freedom of action which might not be wholly to our advantage. On the other hand, the rebels certainly had not shown the competence necessary to take over Indonesia for themselves. Accordingly, we were placed in a very delicate and difficult situation. Mr. Dulles expressed the hope that the new policy statement would not prevent the U.S. from providing small arms to the rebels later if this appeared to be a desirable action. The President paraphrased Mr. Allen Dulles’s comment by stating that he was advocating that we play with both sides.

Mr. George Allen pointed to the fact that on Page 21 of the Financial Appendix to NSC 5901, the program of the U.S.I.A. (information services) was listed under Assistance Programs. He explained that he was somewhat astonished to find the U.S.I.A. program described as “an Assistance” Program. Mr. Gray pointed out that the Financial Appendix did not describe the U.S.I.A. program as such as an Assistance Program. The program was merely listed in a table which covered the estimated costs of carrying out our policies toward Indonesia. Mr. Gray then said he judged that the National Security Council recommended approval of the policy in NSC 5901. The President said this seemed to be the case and while this seemed to be a policy of walking a tightrope, he could see no other solution to the West New Guinea dispute. Mr. Gray pointed out that Secretary Dulles should in effect be permitted to walk the tightrope as best he could. The President, however, suggested that the Dutch were such very good friends of ours and such good allies that we should try to win them over to our point of view. Commenting on the warm personal relationships he had enjoyed with Dutch friends, he was sure that we could find some way to influence them. He commented that perhaps Australia was a harder nut to crack than The Netherlands.

The National Security Council:

Discussed the draft statement of policy on the subject contained in NSC 5901, in the light of the views of the Joint Chiefs of Staff thereon, transmitted by the reference memorandum of January 26, 1959.
Adopted the statement of policy in NSC 5901.

Note:NSC 5901, as adopted by the action in b above, approved by the President for implementation by all appropriate Executive departments and agencies of the U.S. Government, and referred to the Operations Coordinating Board as the coordinating agency designated by the President.

[Here follows agenda item 4.]

S. Everett Gleason
  1. Source: Eisenhower Library, Whitman File, NSC Records. Top Secret. Prepared by Gleason.
  2. NSC 5518, “U.S. Policy on Indonesia,” approved by the President on May 12, 1955, is printed in Foreign Relations, 1955–1957, vol. XXII, pp. 153157.
  3. Document 177.
  4. This covering memorandum from Lay transmitted draft copies of NSC 5901. (Department of State, S/SNSC Files: Lot 63 D 351, NSC 5901—Memoranda)
  5. For text, see Foreign Relations, 1955–1957, vol. XXII, footnote 5, p. 452.
  6. For text, see ibid., pp. 436440.
  7. Document 141.
  8. This memorandum transmitted the views of the Joint Chiefs of Staff on the draft statement of policy on Indonesia. In it the JCS concurred in the adoption of the policy and noted that the draft policy was not “an appreciable change over the policy expressed in NSC 5518.” They also noted that “the United States must act now on its programs for Indonesia, and with a degree of urgency not clearly expressed in the policy guidance section of the draft policy statement.” (Department of State, S/SNSC Files: Lot 62 D 1, Indonesia)
  9. See Supplement.