A missing part of the puzzle concerning the dismissal of the Whitlam government might have been hiding in plain sight for some time — buried in the memoirs of senior public servant Sir Arthur Tange, permanent head of the Defence Department during the Whitlam years. In Defence PolicyMaking: A close-up view (2008), Tange explicitly refers to a meeting in November 1975 between Sir John Kerr and chief Defence scientist John Farrands — something that those opposed to an “external” interpretation of the Dismissal have always sought to deny.

It’s long been argued that the sacking of Whitlam was prompted partly or substantially by his threat to “out” CIA agents working in Australia, and to not renew the lease for US spy base Pine Gap, which fell due on December 10, 1975. Farrands was in charge of the scientific aspects of Pine Gap and knew it better than anyone in Australia. He was both a colleague and friend of Tange’s. It has long been supposed that he acted as go-between between Tange and Kerr — Tange being convinced that Australian defence was on a precipice in November 1975, due to Whitlam’s threats.

Farrands and Kerr met on October 28, 1975, for a general discussion of defence matters — a “cup of tea”, as Farrands called it. That is a matter of public record. But in 1977 Farrands told journalist Brian Toohey (at a Canberra garden party) that he had phoned Kerr on Tange’s behalf on November 8, to let him know of a cable sent by the CIA to ASIO, threatening the suspension of US-Australia intelligence sharing if Whitlam named the first director of the Pine Gap base, Richard Stallings, as a CIA agent — which Whitlam had threatened to do when Parliament resumed on November 11.

Farrands, who died in 1996, later denied that he had said such to Toohey (even though Toohey repeated Farrands’ conversation, immediately after it occurred, to Whitlam, who was arriving at the party as Toohey was leaving). He also denied that he had any meeting with Kerr, other than the October 28 briefing. However, it has long been supposed that he met with Farrands a second time, on November 3, 1975, Melbourne Cup Day, at the Watsonia army base — a listening post for the Defence Signals Directorate (DSD), the Australian equivalent of the NSA (now called the Australian Signals Directorate).

In his memoirs (posthumously published in 2008), Tange notes:

“Farrands had had a discussion with Kerr in November that had been arranged pursuant to Kerr’s practice … of asking public servants to talk to him generally about their work — in this case the kind of work conducted in the Defence science laboratories.”

Yet this is the meeting that occurred on the October 28. Possibly, Tange misremembered the date of that meeting. But it is also possible that he has confirmed a Kerr-Farrands meeting in November, and misattributed the purpose of it. It certainly lends weight to it, and to the suggestion — which need not be seriously doubted — that Farrands and Kerr spoke on either November 8 or 9, regarding the CIA threat to end intelligence-sharing.

Why this matters is because the events around the Dismissal weren’t first and foremost a constitutional or supply crisis — they were a security crisis, as John Menadue was the first to say. Indeed they were more than that. They were part of a war between a permanent security establishment and an elected government — itself part of a wider war of this type, across the Anglosphere. The Dismissal was a supply crisis that was used to “solve” the security crisis — i.e. for a permanent security establishment to inflict a blow on elected governments.

From the start, the Whitlam government was seen as semi-legitimate at best by the Nixon administration as well as the CIA, ASIO and ASIS and the trans-Pacific permanent security establishment (PSE hereafter). Whitlam’s pro-US stance cut no ice: the ALP was seen as socialist, anti-US-alliance, pushing for links with communists, etc. As then-CIA head James Jesus Angleton told Ray Martin in an ABC interview:

“You don’t see the jewels of counter-intelligence being placed in jeopardy by a party that has extensive historical contacts in Eastern Europe, that was seeking a new way for Australia … seeking roads to Peking …”

The CIA had inflitrated the union movement and set up numerous front groups such as the Australian Association for Cultural Freedom (of which John Kerr was a founding member). The PSE was concerned by the ALP’s promise to investigate and disclose the function of US spy bases in Australia and to remove Australian troops stationed in Singapore (a DSD listening post was hidden among them).

Whatever chance of good relations there might have been quickly went sour from early 1973 onwards. The Whitlam government denounced the US 1972 “Christmas” bombings of Hanoi, getting them on Nixon’s “shit list”. Whitlam told US ambassador Walter Rice that there was no advantage to the spy bases for Australia. The US used one base to put its forces on nuclear war footing during the Israel/Egypt Yom Kippur War without informing Australia; in Parliament Whitlam reaffirmed ALP policy, that the base leases, due in December 1975 (for Pine Gap, the largest), would not be renewed. Co-operation between the CIA and ASIS in subversion was ended after Whitlam found ASIS was running agents in the CIA’s project of toppling the left-wing, elected Allende government in Chile and then found ASIS had disobeyed his orders. And attorney-general Lionel Murphy raided the ASIO offices after it became clear that the agency was letting fascist Croation terrorist groups run free, in an effort to stop the government from making fraternal links with non-aligned socialist Yugoslavia.

The raid on ASIO was the last straw, as Angleton made clear:

“[Whitlam’s election] did not affect our relationship until his attorney-general Murphy barged in and tried to destroy the delicate mechanism of internal security, which had been built on patiently since the end of WW II.”

By 1974, both the beleagured Nixon administration and the CIA regarded Australia as antagonistic. They also saw Pine Gap as their most essential base in the world, geared not merely to missile detection but to total surveillance of electronic communications. The base was a “twofer” — it allowed global surveillance and also domestic Australian surveillance, thus allowing it to monitor anti-US-alliance political activity, all revealed at the trial of “falcon/snowman” spy Christopher Boyce in 1977. ASIO was also politicking against the government, planting leaks in the news on Australian foreign policy, left-wing unions, etc. ASIO’s pre-1972 surveillance of Labor figures was also revealed. All this prompted Whitlam to start a royal commission into intelligence agencies, to be headed by Justice Robert Hope in 1974. In the US, the Watergate scandal and hearings had shown CIA involvement in domestic politics, and a further investigatory committee was established (the Church Committee). For the security agencies, it was clearly war with elected governments. The CIA extended its domestic subversive activities, including the establishment of the Sydney-based Nugan Hand Bank, as a focus for channelling money for subversion around the world.

In Australia, the agencies got a chance for an “in”, when in December 1974, the newly re-elected Whitlam government determined to borrow US$4 billion to buy back and develop the country’s mineral resources. Treasury refused to actively help, so the money was to be got from Arab wealth funds, via licensed intermediaries. A dozen or so major shonks and carpetbaggers turned up to try and get such authorisations, several of whom were connected back to a CIA-associated group called Commerce International — including broker Tirath Khemlani, who won the confidence of resources minister Rex Connor, who, with deputy PM (and leader of the Labor Left) Jim Cairns, was sourcing the loans.

The process destroyed Cairns’ career and the Labor Left’s chance of leading the party. Cairns appeared to mislead Parliament by denying he had signed a letter of authorisation, which the opposition then produced. Cairns had allowed Khemlani to keep spruiking for loans, after his authorisation had been withdrawn. The Liberal-NCP opposition had information on the detail of the telexes between Connor and Khemlani, which may have been supplied to them from Pine Gap intercepts. In any case, by October, they had Khemlani, who returned to Australia, and provided thousands of documents to the Liberal Party.

By October 1975, there was both a security crisis and a loans crisis. The Hope Commission had revealed that ASIO head Peter Barbour was multiply compromised; he had been moved out of the job, but instead of his ASIO deputy taking over, Whitlam had appointed a Labor man from the attorney-general’s department, Frank Mahony, to run it. The significance of this has been overlooked. Lionel Murphy had merely raided ASIO; civilians were now running it, privy to its secrets. It was clear to many that Whitlam’s pro-US sympathies were no longer shielding him from a more accurate assessment of our relations.

This was confirmed in late October when he sacked the head of ASIS, William Robertson, after he found that ASIS was running a political agent in newly independent East Timor. The bollocking he gave Robertson, in front of senior mandarins Alan Renouf, Tange and newly appointed head of PM&C John Menadue, could be heard all the way down the hall, through a closed door. It was a clear and deliberate humiliation of one of the founders of the Australian security establishment. By now, the supply crisis had begun.

On October 16, former defence minister now opposition leader Malcolm Fraser had declared Connor’s misdeeds to be “reprehensible” circumstances, and blocked supply in the Senate, demanding a new election. Blocking supply put the government on the clock to run out of money around December 10, if nothing intervened. When Robertson was sacked, Fraser added this event to the reasons for blocking supply, saying that Whitlam couldn’t be trusted on national security.

The suspicions of ASIO leaks to the press and the Liberal-NCP opposition had caused Whitlam’s staff to start investigating security links in Australia, and in October they got a beauty, with information that freelance contractor Richard Stallings was in fact a CIA agent, and had been when he was resident in Australia in the mid-1960s and in charge of establishing Pine Gap (Stallings had had Labor friends in Adelaide in the ’60s, to whom he had bragged of his CIA connections). Better still, he was a friend of National Country Party leader Doug Anthony, had rented a house from him, and there were accusations that money was being funnelled to the Liberal-NCP opposition.

On November 2 at a speech in Port Augusta, Whitlam struck, mentioning but not naming Stallings, Anthony et al. The next day Brian Toohey named Stallings in the AFR. In the ensuing week, a story in the National Review Weekly named three more CIA agents, including the current station chief James Walker and two men who had been directors of Pine Gap after Stallings (Stallings had left Australia, and returned in the ’70s — after leaving the CIA’s tech division he had offered his services as a covert operative). Anthony, outraged (he wasn’t aware his friend Stallings was CIA) challenged Whitlam to back up his allegations. Whitlam said he would, when Parliament resumed, on November 11.

The security crisis and the supply crisis were now fused, and the security establishment was in a flat panic, Arthur Tange especially. For there were two lists of CIA agents operating in Australia. One was held by Foreign Affairs, and a more secret one was held by the Defence Department (DoD). Stallings’ name was on the Defence list, not the Foreign Affairs list. Whitlam had obtained the Defence list only after great resistance from Tange. The prospect of Stallings being named in Parliament made Sir Arthur Tange white as a sheet — which is just as he had emerged from the sacking of William Roberston.

The US State Department put out a statement saying that Stallings was not employed by the CIA. Tange now did everything he could to head off Stallings’ naming in Parliament. First, he tried to get Anthony to withdraw his request and Whitlam to withdraw his threat, through the intermediary of new defence minister Bill Morrison (who had once been Tange’s junior in the External/Foreign Affairs department, and had his career blocked by him). Anthony refused, and Tange would not reveal the existence of the DoD CIA list to him. Tange then did something extraordinary for a senior public servant: he suggested to John Mant, Whitlam’s personal private secretary, that Whitlam lie to Parliament — or lie by omission — and confirm the US statement that Stallings had only ever been an employee of the US Department of Defence, or simply “not contradict” the US statement.

We now know, thanks to Jenny Hocking’s research, and a little added by Paul Kelly and Troy Bramston, that in the lead-up to this week, and within it, Kerr was consulting incessantly with Malcolm Fraser, High Court chief justice Garfield Barwick and judge Anthony Mason — to a degree far beyond anything we knew before, which constitutes on its own a conspiracy against his prime minister. We know that he had all but decided to sack Whitlam in early November, that he had rejected a half-Senate election. We know that he had met with Farrands, the Department of Defence chief scientist on October 28, and possibly again on November 3. We know that following ASIS head Robertson’s sacking, Kerr questioned Whitlam closely about the matter (more closely than on any other political matter, Whitlam told Toohey).

We also know, have always known, who John Kerr was. He was a conspirator, his whole adult life. He started in the shadowy Directorate in WW II, negotiating with groups including OSS (the CIA precursor) to try and snatch British Borneo as an Australian colony post-WW II. He was on Doc Evatt’s staff with Alfred Brookes, ASIS founder, in 1946. As he moved rightwards in the late ’40s, he joined the Australian Association for Cultural Freedom, a CIA front. He took money from another CIA front, the Asia Foundation, even after its front status was unmasked. He was tied up with the trade union right, who were funnelled money by US agencies including the CIA, in the ’50s and ’60s. He got out of a career doldrum in the ’60s through a favour from John Atwill, a Liberal mentor and associate of Malcolm Fraser’s. He cited as influences the writers Pareto and James Burnham — anti-democratic “elite” theorists, the latter believing that democracy must be guided due to the communist global threat (and the influence is clear in the articles he wrote for Quadrant, the CIA-funded magazine of Australia’s right, during that period). He loathed the Labour Left, who at the time contained a tranche of communist sympathisers, and possibly covert members.

From the moment Kerr had become governor-general he had built a separate network of advice and power, with Barwick and Mason fulfilling the legal role — defining an expanded notion of reserve powers to the executive (his first job for the Directorate, in 1942, had been to draft rules for the extra-constitutional exercise of authority, should Japan invade Australia). His program of “chatting” with senior public servants about their work was clearly part of this. Throughout October and November he was operating out of that base, an autonomous non-elected executive Cold Warrior.

This man ruled us as the combined security/supply crisis came to a head on the weekend of November 8-9, 1975, when CIA East Asia head Ted Shackley sent a cable to the ASIO liaison officer in DC, demanding to know what the hell was going on Down Under with naming of CIA agents etc, and threatening to end intelligence-sharing if Stallings was officially named in Parliament. The cable was supplied to Tange immediately (but only reached Whitlam’s office on Monday, November 10). Tange then had Farrands — both his officer and a personal friend and confidant — contact Kerr to communicate the details of the Shackley cable, with the emphasis on the withdrawal of intelligence sharing.

The resumption of Parliament was now looming. Whitlam would officially name Stallings as a CIA agent and identify the entire spy base “joint” arrangement as a CIA operation. He would also accuse the NCP of taking money from the CIA. In the Liberal party room, solidarity was beginning to crumble. Three to five senators had serious doubts. Reg Withers — Fraser’s Senate enforcer — said he couldn’t hold the line past Thursday. On Monday, according to a Whitlam aide, Michael Delaney, the cable from Ted Shackley was supplied to the PM’s office — 48 hours after Tange had received it, and too late to do much about it, given everything else going on. Whitlam, in any case, believed he had won. So did many others — including the CIA.

November 11 loomed as a momentous day, but the one thing that it wasn’t significant for was supply. The government had four weeks worth of money left, and the obvious and democratic thing would have been to let parliament run, and see what happened. That of course was the one thing Kerr and Fraser did not want. The parliamentary day would only start proper in the afternoon, due to Remembrance Day activities. When it did, Gough Whitlam would name Stallings officially, accuse the opposition of taking US funding, and possibly produce other scandals that the opposition knew he might have. The US-Australian alliance would be damaged, but the Liberal-NCP Senate bloc vote would come under enormous pressure, and Fraser might well have lost his majority right away. The one thing that could not happen was that any of this be allowed to go through before a supply vote was brought. And so it went, and so it goes.

It was part of a much wider war, and will be told in those terms.

*This is part of a series on the Dismissal. Read part one and part two here.

Peter Fray

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