Please give the following message to the Prime Minister  for his Most Secret and Personal information:-
The War Cabinet this morning gave preliminary consideration to the position in the event of the French deciding not to carry on. The following is a summarised appreciation of the situation which was before the Cabinet.
1. If we can hold out for some time, there are a good many factors which may produce a state of affairs where the enemy cannot carry on the war, e.g., the effect of our blockade of Germany on the economic position there, particularly as regards foodstuffs and oils; dissatisfaction and loss of morale in Germany-there are many indications of this; possible aid in increasing quantity from the United States and the Dominions; growing fears of German domination in Italy, Russia and the Balkan States and consequent unwillingness to supply Germany with her needs, etc.
2. The question is:-Can we hold out? What we have chiefly to fear is invasion, mainly seaborne, but supplemented by airborne forces. As regards the former, if the enemy were to succeed in landing in force tanks and other equipment such as that employed by them in Northern France, it would be a formidable threat to our security.
Protection against seaborne attack is the Navy, but the Navy cannot operate in narrow seas without serious loss unless adequately protected by air. The air is therefore the vital point.
3. As regards the air, Germany has a considerable numerical superiority. This is provisionally estimated at approximately 2 1/2 to 1 as regards both first line and reserve machines, but this estimate is under dose and immediate examination. Numerical superiority is not, however, conclusive; the man counts for a great deal more than the machine, and recent air operations in France have shown vast individual superiority of British over German pilots as well as machines.
On the other hand, in view of the short range, the enemy can now send to this country bombers accompanied by fighters who engage our fighters and so leave the bombers unmolested.
Again, our own recent night raids on military objectives in Germany have had serious effects on German morale and have achieved material damage. Our losses have been small and our forces have encountered little opposition. The question is whether German night raids would be similarly successful here. Would it be possible for the enemy to bring our production to a standstill both by destruction and by lowering the morale of our workers, and so gradually achieve control of the air over this country? It is not possible to answer this question with certainty until night bombing by Germany has been tried out, but in any case it is felt that a considerable time would have to elapse before Germany could hope to gain air superiority sufficient to justify invasion.
4. An important factor, assuming our ability to carry on, is whether we can rely upon steady economic and financial support from the United States. It is assumed, for the purpose of this appreciation, that this would be forthcoming.
The War Cabinet's preliminary consideration of the position resulted in the view that there could be no question at this stage, with the Navy undefeated and a formidable Air Force in being, of our giving up the contest in the event of the French deciding not to carry on. This view is, of course, without prejudice to the consideration of any proposals that might hereafter be made for a cessation of hostilities and subject to developments in the military situation, which is now liable to change from hour to hour.
It should be emphasised that though this appreciation is based on the hypothesis that the French will not continue to fight-they have not said that they will not-and we hope to persuade them to maintain the Allied front intact.