Apart from the question of participation in Far Eastern war dealt with in most secret Prime Minister to Prime Minister cable of 5th July , the most important question to be dealt with at the Berlin Meeting is the future of Germany.
This issue is covered by Item 2 in United States of America Agenda all four sub-items (a) to (d) being germane to the question and indicate a logical approach.
Item 3 of United Kingdom Agenda covers the question but only sub- items (c) and (e) are directly relevant.
No indication, however, is given as to the policy the United Kingdom Delegation proposes to advocate and would desire to see adopted if United States of America and U.S.S.R. agreement can be obtained. All my efforts to ascertain what this policy is have been unsuccessful. My clear impression is that no decision has been reached and that the line to be taken at Berlin will be determined in the light of developments there without consultation with the United Kingdom Cabinet and certainly without any opportunity for the Dominions to express their views.
This is most unsatisfactory as the future form of Government in Germany e.g. a Control Government maintaining the unity of the Reich (even if substantial tracts of territory have been detached at the perimeter) or localised administrations involving the dismemberment of the Reich brought about either by compulsion or German initiative resulting from a period of decentralised control by the Allies-is a matter of vital importance.
Equally important is the question of Germany's economy, e.g. how far the maintenance, re-establishment and even expansion of German industry will be permitted and the extent of the control and direction of such industry.
Without some directive as to the fundamental policy on these great issues, even if only of the broadest character, I cannot see how the Central Control Commission or the Allied Administrations can perform their tasks as they must have some basis upon which to function.
I imagine this necessity will become apparent during the present Conference with the result that some broad general guidance will be afforded to meet the immediate situation and a reference of the problem will be made to the Council of Foreign Ministers proposed by the United States of America.
While in this cable I am only dealing with this one issue many other questions in which we have a vital interest, but with regard to which we have had no opportunity of expressing our views, will arise at the Conference.
I do not think, however, that in all the circumstances there is any useful action you can take. I will continue to press for information as to the United Kingdom attitude on all major questions and for an opportunity for you to express your views before decisions are taken.