Chapter 38 – Back To Canberra and The Abortive NARA Treaty


The Ultimate Frustration

1.  Department of Prime Minister and Cabinet, Canberra
2.  The “NARA” Treaty – Origins
3.  Retrospective MFN
4.  The Treaty Draft – Spies at Work
5.  NARA Sabotaged
6.  Japan’s Struggle In Vain
7.  A Strange China Connection
8.  The Resources Diplomacy Game
9.  The Treaty Flip-flop
10. Whitlam: The Dismissal
11. NARA Postscript
12. Get Over it Mate

December 1974. 

I have left ‘The Australian’ in Japan and am back to Canberra. 

I am due to take up a position, Assistant Secretary level, Policy Coordination Unit (PCU), Department of the Prime Minister and the Cabinet (PMC). 

The PCU Unit was set up by my former mentor in The Australian, John Menadue, now the head of PMC. 

PCU was supposed to provide him with policy ideas and ride herd on the bureaucracy generally. 

There I was given a big room, a big desk and a private secretary – a totally Australian lady (a big change after Tokyo), totally nice, and totally efficient.

1. The Department of Prime Minister and Cabinet, Canberra.

PMC was, and remains, Canberra’s top ministry.

One of its two main functions was to vet submissions from ministries seeking Cabinet approval. 

The other was to feed advice to the Prime Minister and his Cabinet

For just one year and two months I would be as close to the center of power and influence in a Canberra administration as I would ever be. 

But what should have been an elevating experience turned out to be highly disillusioning. 

I have recounted many of the reasons in my Quadrant website article entitled ‘1975’. (I recommend the article to all readers of these memoirs.


True, administrations have daily to face a variety of issues, many important. 

On an average day someone in Menadue’s position would have dozens, maybe hundreds, of papers cross his desk. 

I had to admire Menadue’s ability to handle the paper, not to mention the endless phone-calls. His years with News Corp must have given him experience.

But I was less impressed by the time and effort given to trivial matters seen as crucial to the image of the Whitlam government. 

Meanwhile more important matters were sometimes left to languish. 

In its final years, the Whitlam administration had become a gigantic PR exercise. 

Its media consultant, Brian Johns, who had also been recruited by Menadue, seemed focussed solely on making sure the Whitlam regime got its image right. 

He would sit in on the daily briefings for the prime minister. 

Meanwhile the rest of us in PCU were left to grapple, often alone, with policy issues that in the long run were much more important to the government’s future than any amount of clever press relations. 

Sometimes they had been left in the hands of people determined to make sure the government did not have a future.

2. The “NARA” Treaty – Origins

One of the worst examples was the way in which Whitlam’s plan for a so-called NARA treaty with Japan was sabotaged by the spies and the anti-Whitlam bureaucrats. (For the fuller details see my article ‘1975’ on this website). 

I had long been involved with NARA. 

As correspondent in Tokyo I had been surprised by Canberra’s obstinate refusal of Tokyo’s request for the standard Friendship, Commerce and Navigation Treaty which Japan had with most of its trading partners. 

Australian manufacturers had seen such a treaty as the thin edge of a wedge that would allow Japan to deluge Australia with its goods. 

But Japan’s minerals importance to Australia meant it was more than entitled to an agreement regulating normal commercial relations and asking for normal MFN (most favoured nation) treatment. 

Articles by myself and Max Suich, the Fairfax correspondent in Tokyo, had done something to change Canberra opinion. 

I had also worked on Menadue during his Japan visits. 

In 1973 Whitlam announced that as proof of his new broom diplomacy and in recognition of Japan’s importance to Australia he would offer something much wider than the standard Commerce and Navigation treaty. 

It would be called the Nippon Australia Relations Agreement – NARA. 

Early after my 1975 arrival Menadue had appointed me to the Inter-Departmental Committee to handle the treaty. 

The IDC was headed by my former colleague, Michael Cook, the highly conservative Foreign Affairs official whom I was supposed to have replaced in New York as Australian representative on the UN Disarmament Commission back in 1965. 

To my amazement Cook took it on himself to make sure the treaty never came into existence. 

Crucial to the sabotage operation was a piece of phoney information from an incompetent ASIS spy in Tokyo, anxious to impress superiors with allegedly secret information about Japan’s sinister intentions over the proposed treaty. 

In fact, the draft treaty proposed by Japan did not include anything that could in any way harm Australian interests. 

3. Retrospective MFN

True, it had made mention of something later dubbed retrospective MFN. 

This said that if Japan was to have full equality in its economic relations with Australia, it should be given, retrospectively, the same rights and privileges as those given the US and UK in the past. 

After all, if – as Whitlam had insisted – the treaty was supposed to reflect Australia’s special economic relationship with Japan, then it stood to reason that the treaty would at least allow Japan equal footing with the UK and the US. 

But the Canberra bureaucrats objected strongly, and the retrospective MFN proposal was quickly withdrawn by the Japanese. 

But withdrawal, it seems, was not good enough. 

Thanks mainly to the ‘revelations’ from said Tokyo-based spy, the IDC under Cook continued to insist that Tokyo was secretly scheming to revive retrospective MFN. 

On this basis, Menadue and Whitlam were advised to reject even the amended Japanese draft. 

I tried hard to tell Menadue that the advice was mistaken. 

But he was not listening. He preferred to go along with what the spies and Cook were saying. 

In short, here was Menadue, who was supposed to be pro-Japan, and who had been specifically appointed to his PMC job to ensure that this kind of spy-conservative sabotage did not occur, accepting bogus advice from people who both distrusted Japan and were keen to see the Whitlam agenda derailed. 

It was a classic example of the ease with which the Canberra conservatives and spies were able to manipulate and undermine Whitlam’s policies. 

Worse, I had a good idea of just how the spy machine had got at Menadue and Whitlam. 

4. Caution: Spies at Work 

The election of a Labor government in 1972 had cast a shadow over Australia’s entire spy apparatus. 

Before 1972 the spies had worked long and hard to sabotage the ALP. 

ALP reprisals were very much justified, and seemingly imminent. 

The spies also feared a serious retraction of their hitherto close links with the US intelligence machine, which has an instinctive and ingrained dislike of any regime that even smells of progressive or leftwing tendencies 

Remember Chile’s Allende? For a while there were less than charming hints that the US hawks might see Whitlam in a similar light. 

At the very least, the US spies would begin to turn off the information spigots to our spies. Or so it was feared. 

To keep the spigots open, the Australian spies believed they had to move quickly and prove they could keep the Whitlam government under their control.  

The problem for the spies was how to get at Whitlam. They had no direct links into his entourage, at least as far as I knew. 

But they had an idea, and it was a good one. 

For years the Defense Signals (DSD) operation in Melbourne had been decoding Japanese cable traffic as part of Australia’s cooperation in the worldwide Echelon (Five Eyes) network (US, Britain, Canada, NZ and Australia). 

True, there was some question over the level of the cable traffic DSD was decoding. 

Later, and as a result of Brian Toohey raising the issue in 1975, and my raising it again in 1978 (details later), Tokyo was to insist that if there was any decoding it was restricted to business and low grade Embassy material. 

Tokyo sources would insist that this low-grade material was put into simple codes for convenience, and that while the Australians may have found some way to decipher this material, serious Embassy traffic went into codes that could not be broken.

In any case, whatever decoded material the spies put before the eyes of the Whitlam people, it seems to have done the trick. 

Their doubts about those devious Japanese and retrospective MFN were confirmed. 

The entire operation played directly into ALP, and Whitlam, suspicions of Japan. 

From there it was only a short step to establishing a firm pipeline by which other information tidbits could be passed up to and accepted by the people around Whitlam 

(Or at least so I was told by one or two journalists close to the Whitlam camp who also got to see the material.) 

As Menadue admits in his memoirs: 

‘They (the spies) are, however, adept in doling out juicy bits of information that are often untested but draw one into the inner circle of people with privileged information, a twilight world of secrets and gossip. Perhaps we all read too many spy thrillers and vicariously want to be part of the action. Few are immune.’ 

Among the non-immune we have to include Menadue, and even Whitlam himself, at least over NARA. 

5. NARA Sabotaged

In the IDC debating the Japanese draft for a NARA treaty, I soon found myself in a minority of one – in favour. 

I had taken for granted that Canberra would be anti-China. 

But he intensity of anti-Japanese prejudice in Canberra, beginning with Cook and extending all the way down the line, appalled me. 

‘Slippery pigs’ was how one of IDC people saw Japan (I recall he came from Immigration). 

Worse, the IDC was determined not just to reject the Japanese draft but even to refuse to put forward a counter Australian draft. 

Cook told us how he had read books about the Japanese, and was prepared for their devious tactics. Even to propose a rival draft would give them a chance to indulge in those tactics. 

The Japanese had to be told pointblank that their draft was unacceptable, and leave it at that. That way they would be forced to realize that their plots had been exposed. 

This was pure nonsense, of the sinister persuasion. But my somewhat desperate efforts to get the IDC to see sense were fruitless. 

They all, including Menadue, were convinced they had got it right and I had got it wrong. 

Many were within the ‘inner circle’ Menadue had spoken about. Clearly I most definitely was not. 

As one of those in the inner circle tried to put it to me at the time. ‘Greg, we just happen to know things that you don’t know about Japanese intentions. And if you knew what we know, you would have to agree with us.’ 

I should add that this inner circle personage was a young, junior, wet-behind-the-ears official who just happened to have been put on the PMC foreign affairs desk, and who by virtue of his foreign affairs position was cleared for access to spy materials. 

Meanwhile myself, despite years of having been involved in foreign affairs, and having got it right over Vietnam (or perhaps because I DID get it right), was not cleared for access. 

I had had to learn about the bogus spy material indirectly, from other sources. 

6. Japan’s Vain NARA Struggle 

By chance, the chief Japanese negotiator for NARA was the Gaimusho’s Hideo Kagami whom I had got to know in Moscow ten years earlier. (He was also the husband of the lady I mentioned earlier who in Moscow and later in Tokyo had given me such a charming introduction to things Japanese). 

Kagami had tried bravely for weeks to battle the brick wall imposed by Cook, only to be sent away with a flea in its ear, back to Japan. 

When he left, the IDC people gloated over their ‘success’ in forcing Japan’s wily messenger to go home empty-handed. 

(In fact Kagami was one of the least wily Japanese officials you could imagine. You could even call him naive – a typical product of Japan’s mistaken elitism in recruiting and promoting its top diplomats.) 

(His wife was a lot smarter – the daughter of a former leading Japanese politician.) 

It was yet another of the many ugly experiences I have had to suffer in a long career with Canberra’s brain-dead foreign affairs bureaucracy. 

I should add that Menadue, who almost certainly was smart enough to realise later that he had got it wrong over NARA, never seemed to want to come back to me and admit that he had been wrong. 

At the time my efforts to tell him he was wrong had created some strain on our friendship.

(In retrospect, the Cook conservative opposition to the Treaty may not have been due to anti-Japan feelings. 

(The speed with which they approved the Treaty once Whitlam was gone suggests something else – that they, and their US friends, were determined to sabotage the Treaty simply to deny Whitlam the chance of being able to claim foreign affairs kudos.) 

7. A Strange China Connection 

There was a curious sidebar to the abortive 1975 NARA negotiations. 

Whitlam had gone out of his way in Beijing and elsewhere to tell people that his proposed NARA Treaty would do much to ease Chinese fears of revived Japanese militarism. 

It would guarantee Australia as a stable source of raw materials to Japan. 

No longer would the Chinese have to fear that Japan might go on the war path again to secure sources of materials and fuel. 

To anyone who knew Japan it was an unlikely scenario, and a quite gratuitous promise. 

Apart from anything else, by 1975 Japan had quite a few other sources of raw materials imports – Canada, Brazil, Siberia, Southeast Asia. 

And was Australia likely to cease supplying materials simply because it did not have a NARA Treaty? 

Apart from anything else, Japan had a raft of long-term contracts and investments guaranteeing Australian supplies until well into the 21st century. 

I have reason to believe the unlikely war-path scenario was fed to Whitlam by our embassy in Beijing, though it is also possible he also got something along these lines from Zhou Enlai whose view of Japan was also rather dated, and jaundiced. 

8. The Resources Diplomacy Game 

This strange China connection owed much to Beijing Embassy naivety and Canberra’s gross over-estimation of its resources importance to Japan at the time. 

Canberra had convinced itself that Australian promises or otherwise of resource supplies could change the face of global politics. 

From this it followed that the ‘slippery’ Japanese, in their desperate determination to get a hold on Australia’s resources, would be up to every kind of trick to lure innocent Australians into a disadvantageous treaty. 

Retrospective MFN was seen as a key element in that strategy. In other words, Tokyo’s demand for the concessions given the UK and the US in the old days was intended to allow them to walk away with much of Australia’s resource wealth in their hungry pockets.


True, Tokyo deserves some of the blame for  Canberra’s strange self-delusion. 

Its over-reactive ‘shigen gaiko’ (resources diplomacy) slogans in the wake of the 1973 oil shock had fed directly into Canberra’s foolish resource self-importance. 

But, and as I have discussed earlier, anyone who understood the Japanese ability to exaggerate dangers, could easily have realised the superficiality of it all. 

But not Canberra.

9. The NARA Flipflop 

Curiously, as soon as Whitlam was replaced by Fraser early in 1976, the bureaucracy decided that the treaty – renamed the Basic Treaty of Friendship and Cooperation – was quite OK after all. 

Two of my former FA colleagues – Gary Woodard and Ashton Calvert - were sent to Tokyo to renegotiate it. 

In a matter of weeks all problems were resolved. 

(Both were later to fill me in on the inside details, some of which are recounted in the ‘1975’ article.) 

The wording of the agreed treaty was almost identical with that of the treaty draft that Menadue, Whitlam, Cook and just about everyone else had only a few months earlier declared to be totally unacceptable. 

In the years since, none of the Japanese plots darkly warned of by our spies and hawks, Cook especially, have even pretended to emerge. 

But Cook kept his job. 

He was to become a confidant not only of the Fraser regime but also of later Labor regimes. 

Hawke even made him ambassador to the US – a move that must have made a lot of shady people in Washington very happy. 

10. Whitlam: The Dismissal

I do not go along with claims that the CIA and others plotted Whitlam’s November 1975 dismissal. 

Whitlam brought that on himself, by his poor handling of the economy, the ludicrous attempts to get round Senate refusal of supply in late 1975, and his foolish trust in Kerr, the man he had appointed as his governor-general. 

But the US hawks and spies must have been very happy to see Whitlam’s foreign policies sabotaged as much as possible. 

One does not have to be totally paranoiac to assume that making sure Whitlam did not get his treaty with Japan would have been one of their objectives. 

True, the Whitlam hagiographers, Graham Freudenberg and Fitzgerald especially, have had no trouble telling us how Whitlam deserved full credit for this major breakthrough in relations with Japan – the break-through in fact being the treaty rejected by Whitlam and reached under Fraser. 

Such are the ways the fables of history are made. 

11. NARA Postscript 

In 2001 our Tokyo Embassy held a splendid function to celebrate the 25th anniversary of the Basic Treaty. 

Academics and others were flown in from all over Australia, including even an American at an Australian university who could not conceivably have had anything to do with the Treaty. 

Curiously, the list of invitees did not include this writer. This, despite the fact he was already in Japan and that he had long been involved in the realizsation of the treaty. 

Much the same was to happen in 2006, on the 30th anniversary of the Treaty. Once again Canberra was to make a song and dance about the importance of the treaty. 

And once again I was not invited to the dance. 

Canberra was also to commission some alleged historians to write up the alleged history of the treaty negotiations. 

With its crucial omissions, and its brazen attempts to make Cook look like a hero standing up for Australian interests, it would have embarrassed even a communist regime setting out to rewrite history. 

12. Get Over it Mate

Many years later I was to meet a young, progressive, smart, independent-minded Canberra based lady looking into the NARA background. 

As I went though the various points about how and why Canberra had got it wrong, she jokingly gave me today’s standard Canberra response to mistakes of the past – ‘Got to move on, mate.’ 

I guess she was right. Even so, someone has to keep the record straight. Otherwise the fabricators just take over. 

And NARA was not the only example. 

I was about to meet quite a few more.