[Annex]
Report by the Policy Planning Staff
TOP SECRET
[Washington,] February 24, 1948.
PPS/23
Review of Current Trends
U.S. Foreign Policy
I. UNITED STATES, BRITAIN, AND EUROPE
On the assumption that Western Europe will be rescued from communist control, the relationships between Great Britain and the continental countries, on the one hand, and between Great Britain and the United States and Canada on the other, will become for us a long term policy problem of major significance. The scope of this problem is so immense and its complexities so numerous that there can be no simple and easy answer. The solutions will have to be evolved step by step over a long period of time. But it is not too early today for us to begin to think out the broad outlines of the pattern which would best suit our national interests.
In my opinion, the following facts are basic to a consideration of the problem.
1. Some form of political, military and economic union in Western Europe will be necessary if the free nations of Europe are to hold their own against the people of the east united under Moscow rule.
2. It is questionable whether this union could be strong enough to serve its designed purpose unless it had the participation and support of Great Britain.
3. Britain's long term economic problem, on the other hand, can scarcely be solved just by closer association with the other Western European countries, since these countries do not have, by and large, the food and raw material surpluses she needs; this problem could be far better met by closer association with Canada and the United States.
4. The only way in which a European union, embracing Britain but excluding eastern Europe, could become economically healthy would be to develop the closest sort of trading relationships either with this hemisphere or with Africa.
It will be seen from the above that we stand before something of a dilemma. If we were to take Britain into our own U.S.-Canadian orbit, according to some formula of “Union now”, this would probably solve Britain's long term economic problem and create a natural political entity of great strength. But this would tend to cut Britain off from the close political association she is seeking with continental nations and might therefore have the ultimate effect of rendering the continental nations more vulnerable to Russian pressure. If, on the other hand, the British are encouraged to seek salvation only in closer association with
