88. Memorandum From the Joint Chiefs of Staff to Secretary of Defense McElroy 0


  • Indonesia
The Joint Chiefs of Staff, in a memorandum dated 18 April 1958,1 recommended to the Secretary of Defense that the United States explore the possibilities of making some positive gesture toward the Indonesian Military Services to halt the trend toward a Communist takeover in Indonesia.
It is understood that such an approach has been authorized.
Recent reports from various sources indicate that the political climate in Indonesia may be evolving into a situation where it would be timely to take steps to expand the approach to the military Services into more public action of greater scope.
The most urgent problem facing Indonesia, besides the immediate problem of the rebellion of the dissident groups, is the deterioration of the economy of the country. Indonesian economy has steadily declined since the Japanese occupation. The recent expulsion of the Dutch has aggravated further an already bad situation. It seems obvious that, if Indonesia is to survive as an independent nation, she must be assisted by the free nations of the world to a position of economic stability. If she is assisted by Soviet Bloc countries, Indonesia will inevitably swing into the Sino-Soviet orbit.
Therefore, the following courses of action for the immediate future are proposed:
The United States make an official public policy statement concerning Indonesia, in order to establish a world understanding of the U.S. position and serve as a basis for further action. It is envisaged that this statement would express:
United States support of the independence of all free nations, and desire to help preserve the sovereignty of Indonesia in particular.
United States concern over a pattern of events in Indonesia, which has in the past in other countries led to the loss of the sovereign independence of the nation concerned, and its reduction to that of a virtual colony of an imperialistic power.
The conviction that the current internal strife in Indonesia both facilitates and obscures the rise of foreign agents and their followers to power through exploitation of Indonesian political and economic troubles.
An offer of U.S. good offices in working out a peaceful solution to Indonesian internal problems.
An offer of U.S. assistance in working out ways and means of establishing a strong, prosperous, and independent Indonesian economy.
The current deteriorating economic situation in Indonesia is one is which all Indonesians, especially the Rebel leaders, recognize the need for help. The United States should offer a moderate “impact program” of economic aid. This program should provide immediate, visible contributions to the capital plant of the Indonesian economy; for example, land, sea, and air transportation equipment. The scope and promptness of this program should be at least comparable to the recent Russian deliveries of ships. Deliveries, especially initial deliveries, should be made promptly.
The United States should, on the assumption that the approach to the Indonesian Military will prove successful, take steps to insure immediate delivery, upon agreement, of an initial increment of a military aid program. A token grant military aid program, the bulk of which is army equipment has been assembled and ready for some months. Negotiation or financing should not be allowed to interfere with prompt execution.
The above courses of action would neither negate previous actions taken nor necessarily preclude their continuation for the time being. Properly timed, they should serve to establish a logical overt cold war beachhead for future U.S. operations in Indonesia:
The public statement will establish in world opinions the moral basis of U.S. concern. It will also serve notice to all concerned in Indonesia of the new lines of U.S. action.
The impact economic program will provide an initial boost toward Indonesian economic recovery, as well as a favorable basis for further U.S. interest and activity in the economic field. It should be followed up by longer-term programs designed to put the potentially prosperous Indonesian economy on its feet.
The token military aid program will establish a small initial requirement for spare parts and training; this will provide an opportunity for some degree of continuing U.S. influence over the Indonesian Armed Forces. Consideration should be given to subsequent additional programs, possibly including the establishment of a U.S. Military Mission.
It is recommended that the above views of the Joint Chiefs of Staff be submitted to the National Security Council for consideration.
For the Joint Chiefs of Staff
N.F. Twining
Joint Chiefs of Staff
  1. Source: Department of State, Central Files, 756D.00/5–1458. Top Secret. McElroy forwarded this memorandum to Dulles on May 14 under cover of a letter that reads: “The enclosed copy of a memorandum dated 9 May 1958 sets forth the views of the Joint Chiefs of Staff on the current Indonesian situation. Although I understand that certain steps are already being taken along these lines, I believe their comments and recommendations merit serious consideration.”
  2. Document 68.