Foreign Relations of the United States, 1964–1968, Volume XXVI, Indonesia; Malaysia-Singapore; Philippines

280. Memorandum From the President’s Special Assistant (Rostow) to President Johnson¹

Washington, September 14, 1967.

SUBJECT

• Malaysian Desire to See You on Fall in Rubber Prices

The price of rubber has recently reached a 17-year low. The Government of Malaysia is trying to give the impression that it is doing something about it. Without any discussion with us, they announced that their Finance Minister was coming to Washington to discuss with you, if possible, the “serious problem” posed by sales from our rubber stockpile.

This is nonsense. During the past 12 months we have cut our stockpile sales from 170,000 tons a year to the current 70,000 tons, all of which is used to meet U.S. Government contracts. These sales simply are not a significant factor in the current rubber market.

I do not believe you should see the Malaysian Finance Minister:

(1) He will be asking that we totally suspend our disposal sales. He should be told “no,” and I think it best that he get that answer from a lower level.

(2) It is probable that the Malaysians will, at some stage, try to make us the whipping boy for their rubber problems. I, therefore, think it best that you avoid any personal involvement in this matter.

(3) Finally, they are trying to meet a serious problem by chanting magic incantations. I think it is beneath the dignity of your office to get involved in this exercise in futility.

The State Department is in agreement, but I expect Malaysian Ambassador Ong will make strenuous efforts to arrange the appointment through the back door, once he finds the front door is locked. This memorandum is intended to “cut him off at the gulch.”

I recommend that you decline all efforts to arrange a meeting between you and the Malaysian Finance Minister.²

Walt

1. Source: Johnson Library, National Security File, Country File, Malaysia, Vol. IV, Cables, 1965–1968. Confidential. Rostow based this memorandum on memoranda from Jorden, May 9, and Wright, September 14, to him. (Ibid., Memos, 1965–1968 and ibid., Cables, 1965–1968)
2. Johnson checked the “Approve” option. Rostow added the following handwritten option: “My boys recommend that I see him.” Johnson subsequently changed his mind and did see the Finance Minister; see Document 283.