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is embarking upon course (ii), our resistance to it might compel her to resort to course (iii).
6. But there is no need to assume the worst and our immediate responsibility is to maintain law and order, retain morale and confidence so that t e economy can continue to flourish. Firm action is required to do this but, at the same time we should avoid, as far as possible, action which could be regarded by the C.1.G. as provocative. We should avoid doing anything to "escalate the confrontation" to the extent that we get involved in a situation from which there is no escape except by abject surrender or a futile attempt to fight it out, leading to the same result. Our steps, therefore, must be directed to the needs of the local security situation, while taking the wider implications into account, and they need to be carefully measured and timed.
7.
Recommendations
I accordingly ask my colleagues to endorse the views in paragraphs 5 and 6, and to agree to the following action:-
(1) Local Security
(a) We are already sending the Commando Carrier
BULWARK to Hong Kong where she should arrive by the end of this week.
(b) The Governor has already been authorised to
neutralise several of the buildings from which the campaign is being directed.
(c)
The Governor has now asked for authority to pick up and, if possible, deport (or failing that, detain) some of the known leaders of the present campaign limited to 2 or 3 in the first instance. The disruption of the leadership would be a distinct and positive gain and would be seen by the majority of the population as firm action. On the other hand it is unlikely that the Chinese Government would accept these leaders as deportees and, if they were detained in Hong Kong, this would provide Peking and the local Communists with a grievance. The Governor has
undertaken not to use this weapon lightly or unnecessarily and, on balance, I recommend that he should be given authority to go ahead if the situation requires it.
(d) Action against the principal Communist newspaper
which is the official C.F.G. organ in Hong Kong.
The Governor accepts that prosecutions for sedition or inciting the police to disaffection might have dangerous repercussions, and is proposing instead to seek emergency powers to close down the printing press. But he would only take action after consulting me on each individual case. I would propose to give him a general authority on this understanding.
(ii) Labour
Relations between employees and employers in Hong Kong have not been good and we should do our best to improve matters. Less than 12% of the total working force are declared members of trade unions and there are 100,000
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/members