[matter omitted]

As you will already have learned, the efforts of the Committee of Five set up by the Council on the 6th September have now failed, and the Committee has returned its mandate to the Council. A copy of the report of the Committee of Five to the Council is enclosed herewith.¹ The interesting parts of this document are Annex 1, containing the Committee of Five's proposals for the settlement of the dispute, and Annex 2, containing the substance of certain observations with regard to the committee's proposals made orally by Baron Aloisi to Señor de Madariaga, the Chairman of the Committee of Five.

What the League is going to do now that the effort at conciliation has failed is a matter of general discussion here. Nobody seems to know exactly what is going to happen. We were confidentially informed by a member of the League Secretariat in a position to know what he was talking about, that at present the disposition of the Powers principally interested seems to be simply to let matters slide until war actually breaks out. You will remember in this connection that one of the observations most frequently made since the Italo-Abyssinian dispute arose is that it would be easier to settle the dispute once war had broken out than it would be to prevent war breaking out. Various interpretations are put upon this somewhat cryptic phrase, but it is generally interpreted to mean that a resort to war would ease matters, first by bringing Article 16 into operation, and thereby authorising measures against Italy which would otherwise be illegal, and, secondly, by impairing the man-power and other resources of Italy, and thereby relieving France of the fear that diplomatic action by her against Italy would simply mean a present to Germany of a powerful military ally. However that may be, most people here seem to think that nothing further is likely to be done either by the Council or by the Assembly before the Italian invasion of Abyssinia, which is now said to be fixed for the second week of October.

The President is far from satisfied with this position. In the first place, he feels that it is quite absurd that the Assembly should adjourn without taking some definite action with regard to the dispute, whether that action took the form of a resolution affirming the intention of the League to resort to sanctions if Italy invaded Abyssinia, or the constitution of a Committee of the Assembly to follow the development of the dispute and to convoke the Assembly again in case of necessity. In the second place, the President feels that if the other members of the League are to be forced, by the strict letter of their obligations under the Covenant, to apply sanctions against Italy, the members of the Council on their part should be scrupulous in their observance of the procedure prescribed for disputes of this kind and should, accordingly, proceed at once to the drawing up and publication of the report provided for in Article 15 ￿4 of the Covenant. This will apparently not be done if the present intention to let matters slide until an outbreak of war is adhered to. The President feels very strongly that, before any resort to war and any consequent application of Article 16, the other members of the League are entitled to expect from the Council a report containing a statement of the facts of the dispute and of the Council's conclusions with regard to it. He feels that the task of foreign ministers approaching their Parliaments for the necessary authority for the application of sanctions will be very much weakened if there is any laxity in the Council's performance of its duty in this respect. There is a meeting of the Bureau of the Assembly this evening at 7 o'clock, and the President is now considering whether or not he will raise the matter at the Bureau.

In the meantime, the general impression here is that Britain is now assured of French support in the event of an Italian attack on Abyssinia. It is stated on good authority, that in the course of a conversation on Monday evening, Mr. Eden told M. Laval that there were grave misgivings in England as to the future of Franco-British collaboration in the event of war in Ethiopia. Mr. Eden went on to ask M. Laval whether there was any foundation for these misgivings. We understand that M. Laval told Mr. Eden that there was no foundation for these misgivings and that France would definitely take her stand with Britain. The British comment on this to us was that 'the French are still a long way off from the idea of sanctions'. I think from this it may be understood that the French are prepared to side with the British to the extent of imposing economic sanctions against Italy and refusing credits to that country, but that, at least in present circumstances, the French general staff are not prepared even to contemplate military sanctions.

The slowness of the proceedings here is beginning to have its effect on the enthusiasm of some of the countries who, a fortnight ago, were in a hurry to mount the Tribune of the Assembly to declare their fidelity to the Covenant. Denmark is understood to be wobbling. Austria will definitely take no part in sanctions whatever, thus making a corridor for goods through Germany and Austria into Italy, which will render the economic sanctions taken by other countries very largely nugatory. After the British, the Russians and Turks are the stoutest up-holders of the Covenant at the moment. The Russians are reported to have stated in the corridors that they are putting fifteen ships into the Mediterranean without delay. One of the dangers of postponing further action by the Council or the Assembly until war has broken out is that it may furnish a valid excuse to a number of States which are now probably as anxious not to have to take any action under Article 16 as they were a week ago to declare their readiness to go to war with Italy under that Article.

The whole position is therefore still one of great uncertainty. As you will see by the oral observations made by Baron Aloisi to Señor de Madariaga, the Italians are apparently still prepared to contemplate something in the nature of an international mandate. A new crop of rumours which sprang up this morning indicates that there may be some further exploration of this possbility and that a further three-Power Conference may be held. But the general feeling here is that no such effort can have any real effect on the realities of the situation, which are, a) that unless Mussolini is supplanted, there will be a resort to war in East Africa and b) if there is a resort to war in East Africa, sanctions will be applied by Britain, with the active assistance of Turkey and Russia, with at least the moral co-operation of France, and with the co-operation of a number of small Powers for what it is worth, against Italy.