JULY 18, 1941. 
Memorandum for the Chief of Staff: 
Subject: Strategical Estimate of the Situation.

1. The following estimate has been prepared as requested in Memorandum from the Assistant Chief of Staff, WPD, 4570, June 6, 1941, which requested information on the Axis Powers as of July 1, 1941, July 1, 1942, and July 1, 1943, as a basis for the War Department STRATEGIC ESTIMATE. Specific data requested in paragraphs 2 (1), (2) of the Memorandum cited and (3) on Axis naval, air and field forces are enclosed.*

2. Estimate of disposition-military, political, economic and psychological.

a. July 1, 1941.

Germany, with the initiative, was employing the mass of her ground and air forces against the U. S. S. R., without, however, relaxing her campaign against shipping serving the British Empire. Elsewhere the military effort of the


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European Axis was at a minimum. Japan, her army practically contained by China, was contemplating action against Indo-China, but her policy was dominated by the uncertainties arising from the Russo-German campaign and the final outcome of the whole war. An Axis political offensive was in full swing with a view to consolidating a "United States of Europe" to include Spain and Portugal and the French, Spanish and Portuguese possessions in Africa. Axis propaganda was being used effectively in Latin America and throughout Islam and with less effect in the United States and India.

b. By July 1, 1942.

(1) The following are envisaged:

(a) German defeat of U. S. S. R. and re-establishment of German military initiative.

(b) Participation of the U. S. in the war under Rainbow 5.

(2) Under the foregoing the following are estimated to be the Axis disposition and capabilities:


German occupation of the U. S. S. R. to Lake Baikal and possibly to the Pacific. Possible Japanese occupation of the Maritime Provinces of Siberia. Axis control of Africa, roughly north of the line Fernando Po-Djibout is either accomplished or imminent. Continuation of the aerial and naval siege of the British Isles. German attempt to invade Great Britain or (more probable) a broad strategic movement through the Middle East toward the Indian Ocean, possibly in conjunction with a southwestward advance by Japan. The political consolidation of Europe under German leadership will have been accomplished but the political cohesion of this entity will be low. Germany and Japan will be obviously war-weary. Economic exploitation of the U. S. S. R. will have barely begun. While still debarred physically, militarily and economically from Latin America, the Axis will have achieved a considerable amount of political disunion in that area by intrigue and propaganda. German propaganda will tend to have become less effective in India, the United States and the Mohammedan world.

c. By July 4, 1943. Axis dispositions and capabilities are estimated as follows:

Germany will still possess superior ground forces. The invasion of the British Isles, if not already achieved, will now be impracticable. Germany will have extended her penetration southward in Africa and will still be able to renew the offensive in the Middle East. Japan, if not irrevocably committed to war on the side of the Axis, will tend to stand aloof. German economic exploitation of Russia will have progressed, but the general economic condition of Europe will be low. Axis morale will be generally low and war-weariness will be rife. There will be no real political cohesion in Europe. The Axis propaganda effort, centered on Latin America will be losing ground.

                                                SHERMAN MILES
                                         Brigadier General U. S. Army
                                   Acting Assistant Chief of Staff, G-2.
   War Plans Division 
   General Embick 
   Mr. McCloy (Record Section)