Letter from Michael MacWhite to Joseph P. Walshe (Dublin)
(108/52/35)

The sudden changes in British policy in regard to the Italo-Ethiopian conflict and the League of Nations have had a disturbing effect on the State Department and on the Administration as a whole. Little by little the explanation of the Baldwin Cabinet's backdown is trickling through. It is now believed in official circles here that the following important factors were behind the Hoare-Laval agreement.

(1). A report by British Naval Intelligence on Italian naval concentration in the Mediterranean and on the state of mind of the Italian people. This report convinced the British that Mussolini was not bluffing when he threatened a European War in case of an oil embargo. Italian submarines were reported already concentrated secretly on British shipping routes and within easy operating distances of British Naval Bases.

(2). An ultimatum given Sir Samuel Hoare by Premier Laval to the effect that while he would support Britain publicly, France would not and could not mobilize in case of war. The French General Staff had notified him that in many districts the Reservists could not be depended on to answer a call to arms and the Conscript Maritime or Naval Reserve in the Ports of Toulon, Bizerte and Brest had given indications of revolt if called upon to fight against Italy. The British did not at first believe that these statements of Laval were true but confirmation of their veracity was soon forthcoming from their own secret intelligence.

(3). The seriousness of the Egyptian situation, which was well known outside, and of the situation on the other side of the Red Sea which was very little advertised. Ibn Saud, the powerful ruler of the Arab tribes, who favoured Ethiopia some months ago, has gradually veered against the British because of the possibility of conquering Irak and its large oil fields with Italian support.

(4). A series of secret negotiations with Hitler conducted by the British and French Ambassadors at Berlin which led nowhere. It is believed Hitler was offered colonies, a loan, almost anything if he would sign a non-aggression pact or agree to side with them against Italy but all to no effect. Such an agreement would be resented by the German people and regarded as a retrograde step.

(5). The situation in Central and Eastern Europe. It is well known that German strategy envisages the Anschluss with Austria sooner or later and afterwards a march over Czecho-slovakia into Ukraine and Russia. If the Little Entente had their hands full elsewhere, Germany might take advantage of the opportunity of bringing her well-known plans to maturity.

(6). When Mussolini transferred a few battalions of his soldiers from the Brenner Pass to the Italo-French Border, the consternation in French military circles was understandable. The Italian troops in that district have been a constant reminder to Hitler that he could not take Austria without trouble. These troops were reinforced early this year as a result of the Laval-Mussolini agreement in return for which France offered Italy a free hand in Africa. The French did not anticipate an Italian attack but were worried by the fact that the doors of Austria were being opened wide to Germany. Mussolini knew this when he made the hurried troop transfer which seems to have the desired effect on both France and England, culminating in the Hoare-Laval agreement.

It is now believed that the sanctions imposed on Italy by the League of Nations have not had the desired effect and never will until such time as the members of the League are prepared to place sufficient force at its disposal to overawe an aggressor even at the risk of another world war.