Cabinet have considered the situation confronting us in Europe as a result of the deadlock over Germany in the Council of Foreign Ministers last month. We shall be sending you separately an account of our conclusions as to the line which we should pursue in Germany. In a wider field we feel that the time has come on the one hand to give a moral lead to the friendly countries of Western Europe and on the other hand to take a more active line against Communism.
2. Soviet Government have formed a solid block behind a line from the Baltic along the Oder through Trieste to the Black Sea. Countries behind that line are dominated by Communists and there is no prospect in the immediate future of our re-establishing normal relations with them. In Germany, France, Trieste, Italy and Greece Soviet policy is exerting a constantly increasing pressure. Soviet policy is based on expectation of economic chaos in Western Europe and will be checked if the Marshall Plan succeeds but economic progress alone will not suffice. Indeed if we are to stem further encroachment of Soviet tide we should organise ethical and spiritual forces of Western Europe backed by the power and resources of the Commonwealth and of the Americas thus creating a solid foundation for the defence of western civilisation in the widest sense. The countries of Western Europe already sense Communist peril and are seeking some assurance of salvation. They are likely to welcome a lead from Britain. We believe therefore that we should seek to form a Western Democratic system comprising at any rate, France, The Low Countries and Scandinavia, Portugal, Italy and Greece. When circumstances permit it could be extended to Spain and Germany. There need not be any formal alliance although we already have an alliance with France and there might be alliances with other European countries. But there would be close consultation beginning with economic questions. Essence of the system would be an understanding backed by resources and resolution of participants bound together by common ideals.
3. We realise that Soviet Government would react fiercely to what they would describe as an offensive alliance directed against the Soviet Union. Nevertheless we are convinced that if we are to preserve peace and our own safety we must mobilise moral and material force which will create confidence and energy in our friends and inspire respect and caution in others. Alternative would be to acquiesce in continued Russian infiltration and undermining of one Western country after another.
4. Foregoing policy would require strong political and moral leadership from Britain and assistance in building up counter attraction to tenets of Communism. This we think we could give. Material help to devastated countries will also be needed and at present this must necessarily come from the countries of America as well as from the Commonwealth.
5. If this conception is to succeed we shall of course need the support of other British Commonwealth countries and of the United States. I am therefore taking the earliest possible opportunity of letting you know what is in our minds. If you have any comments my colleagues and I would welcome them. Foreign Secretary will probably ventilate the idea of a Western System in public in foreign affairs debate in Parliament later this month and we should thereafter pursue it as occasion demands with Governments concerned.