In Dark Money, Jane Mayer writes that:
“Private foundations have very few legal restrictions. They are required to donate at least 5% of their assets every year to public charities-referred to as “nonprofit” organizations. In exchange, the donors are granted deductions, enabling them to reduce their income taxes dramatically. This arrangement enables the wealthy to simultaneously receive generous tax subsidies and use their foundations to impact society as they please. In addition, the process often confers an aura of generosity and public-spiritedness on the donors, acting as a salve against class resentment.
Because of all these advantages, private philanthropic foundations proliferated among the ultra-wealthy during the last century…The practice began in the Gilded Age with John D. Rockefeller, whose philanthropic adviser Rev. Frederick Gates warned him with alarm, ‘Your fortune is rolling up, rolling up like an avalanche! You must keep up with it! You must distribute it faster than it grows!‘”
When Rockefeller asked legal permission from Congress to build his foundation in 1909, “a parade of notable Americans testified in Congress against the creation of private foundations.” John Haynes Holmes, co-founder of the American Civil Liberties Union and National Association for the Advancement of Colored People, denounced private foundations as, “repugnant to the whole idea of a democratic society.” Frank Walsh, chairman of the US Commission on Industrial Relations, suggested that, “huge philanthropic trusts known as foundations, appear to be a menace to the welfare of society.”
As Mayer notes, in the years since the Rockefeller Foundation did finally emerge, “the number of private foundations grew along with the kaleidoscope of issues into which they delved. By 1930, there were approximately two hundred private foundations…By 1950, the number had grown to two thousand, and by 1985 there were thirty thousand.” Bolstering this growth of “the Foundation” was as 1917 law granting unlimited tax deductions on charitable giving by wealthy individuals and groups. “The rationale was that despite their wealth they deserved the public subsidy, so long as their gifts profited the public, rather than their own private interests. Conservatives who opposed the use of the tax code for all kinds of other social engineering nonetheless fully embraced the loophole in this instance.” In other words, “the tax law ended up spurring the funding of the modern conservative movement.”
Standard liberal critique of this legal precedent resigns itself to note and belittle the “hypocrisy” of conservative capitalists. But this was not some clever, albeit “hypocritical” jiu jitsu by the bourgeoisie against some historically progressive movement of bourgeois democracy. Indeed, it was the extension of the Progressive movement’s philosophy to the most logical interests of the bourgeoisie, including the most reactionary among them. The “hypocrisy” present in the 1917 law is in fact the contradiction present in “progressive” reformism itself, in the entire project of bourgeois liberalism as such.
Among the most ardent supporters of the new tax code was the Mellon-Scaife branch of the bourgeois Mellon family. Its progenitor, Andrew Mellon, was something of a precursor to the later neoliberal ideologues, advocating for neoliberalism’s tenets-tax cuts for the wealthiest, less oversight of private business by the federal government, and the combatting of labor organization etc.-years before they were en vogue among bourgeois economic theorists and government policymakers. In his capacity as Secretary of Treasury under Presidents Warren Harding, Calvin Coolidge, and Herbert Hoover, Mellon even did his part to directly contribute to the crisis of 1929-1930 that led to the Great Depression.
The Mellon Family empire emanates from the bank founded in their name by patriarch Archibald Mellon in 1869. Andrew and his brother Richard, according to Amity Shlaes, “created first a national bank, then a steel concern, and then an empire. Young Mellon cornered the bauxite market. He shared in the profits of Carnegie Steel…” From here, “The Mellons together established the enormous Aluminum Company of America; later they picked up Bethlehem Steel. They invested in Spindletop, the Texas gusher that opened the Gulf Coast oil industry.”
While Andrew Mellon was Secretary of State under Hoover, the family received quite the deal from the federal government. According to Kevin Phillips, in 1927, after Britain opened its oil field in Iraq to American capital, Gulf Oil, “bought the oil concession in Kuwait, soon taking the Anglo-Persian Oil Company into partnership there to satisfy the British.” This was oil deal exemplifies many such arrangements that set a precedent for the vast network of public-private partnerships that now characterize American political economy. “One of our greatest helpers has been the State Department,” John D. Rockefeller wrote in his memoir. “Our ambassadors and ministers and consuls have aided to push our way into new markets in the utmost corners of the world.”
Three years after the market crash of 1929 that his uncle was partially responsible for, Richard Mellon-Scaife was born. His mother, Sarah Mellon, had married Alan Scaife during the war. Scaife was not only a fellow heir to a large fortune, but had, as Mayer writes, “cut a dashing figure across Europe” as part of the Office of Strategic Service, the predecessor to the Central Intelligence Agency. When Alan Scaife died in 1958, Sarah Mellon set up two charitable trusts of $50 million each and in 1961 created a second pair of trusts worth $25 million each. She proceeded to create the Sarah Scaife Grandchildren’s Trust, filling it with $100 million. Thanks to the tax code, these trusts could be designed so that the net interest on all of them was donated over the span of twenty years or so, ensuring the principal investments could be passed on to the next of kin tax-free. Because Richard Mellon-Scaife’s sister, Cordelia, had no children, he acquired full control of the Grandchildren’s Trust. Between 1963 and 1984, Richard Mellon-Scaife, “directed virtually all of the charitable donations stemming from the interest on all three trusts, which cumulatively held assets of $250 million.” (Mayer)
The same year as Gulf Oil received its lucrative deal in Kuwait, chemical engineer and businessman Fred Koch devised an improved method for extracting gasoline from crude oil. In 1930, Koch’s oil refinery business was tapped by the Soviet Union to help the government process Russia’s massive domestic oil reserves. Koch, a hardline anticommunist, initially refused the offer, but “after securing an agreement to get paid in advance, he overcame his philosophical reservations” (Mayer). Two years later, the Soviet government began copying the technology and built the remaining refineries itself, knocking Koch’s firm down to a less profitable advisory role.
Koch decided to maintain profits by securing a new European partner. In 1934, Winkler-Koch oversaw the construction of a huge oil refinery owned by a company in Hamburg, Germany. This refinery’s top executive was William Rhodes Davis, an American Nazi sympathizer accused by a federal prosector of acting as an “agent of influence” for the Third Reich. The refinery eventually became the third-largest of its kind in Hitler’s Germany. Its fuel was even used in bombing raids by Nazi Luftwaffe pilots during the war. Historian Dale Harrington points out that this refinery was one of the few that could, “produce the high octane gasoline needed to fuel fighter planes.” Thus, Winkler-Koch’s refinery became, “a key component of the Nazi war machine.” In turn, as a business history of the Naziz oil indutry authored by Raymond Stokes concludes, “Winkler-Koch benefited directly from the project, which was designed to help enable the fuel policy of the Third Reich.”
Fred Koch wasn’t the only American capitalist profiting handsomely from helping the Nazis. In fact, the love affair between the US bourgeoisie and Nazism precedes Hitler creating and giving himself the post of “Fuhrer.”
In March of 1923, a full ten years before the Nazi consolidation of power, Hitler told a reporter from the Chicago Tribune, “We look on Heinrich Ford as the leader of the growing fascist movement in America. We admire particularly his anti-Jewish policy which is the Bavarian fascist platform.” Three years earlier Ford had published a book titled The Inernational Jew: The World’s Foremost Problem, which the Nazi Party, according to Hitler, translated into German and “circulated to millions throughout Germany.”On his 75 birthday in 1938, Ford received the Grand Cross of the Supreme Order of the German Eagle, the highest honor the Nazis could bestow on any foreigner. He was the first American to receive the honor, and personally met with represenatives from Hitler’s regime to do so. In 1999, Nazi documents were released which showed, “the Ford Motor Company was one of 500 firms which had links with Auschwitz.”
There is also the case of Herbert Walker and his son-in-law Prescott Bush. More than six decades after heir Union Banking Corporation’s assets were seized by the US government under the Trading with the Enemies Act in 1942, The Guardian obtained declassified documents which revealed that another firm Bush worked for, Brown Brothers Harriman, “acted as a US base for the German industrialist, Fritz Thyssen, who helped finance Hitler in the 1930s .” As Russ Baker writes in Family of Secrets, “Understanding the role of Brown Brothers Harriman is central to understanding the Bush legacy and the vast, if underappreciated, influence of the Bushes’ immediate circle.” Because the Bush family is so influential in the “Cold War deep state” under examination here, it is also central to understanding the larger power structure of the American bourgeoisie in second half of the 20th Century.
According to Baker:
“At Yale, in 1916, Prescott Bush had become close friends with his classmate Roland “Bunny” Harriman, heir, along with his older brother, W. Averell Harriman, to E. H. Harriman’s vast railroad, shipping, mining, and banking empire. Both Harrimans, like Prescott Bush, were initiates of the Yale secret society Skull and Bones. After graduation, Prescott took a job offer from a Skull and Bones elder in St. Louis, where he soon married the daughter of the prominent St. Louis stockbroker George Herbert Walker. Shortly after that, G. H. Walker was hired by the Harrimans to come to New York and build a new investment banking empire for the family.
Perhaps to forestall charges of obvious nepotism, Prescott spent several years working for other firms before joining W. A. Harriman in 1926. One year after the stock market crash of 1929, W. A. Harriman merged with Brown Brothers, a white-shoe banking partnership whose Wall Street operation dated to 1843, and whose roots went back decades earlier to cotton mills in England…
Earlier partners in the Brown Brothers bank in England had served in governments in that country, and the firm’s influence in the United States was perhaps even greater. Brown Brothers Harriman was resolutely bipartisan, and partners moved effortlessly from Wall Street to Washington and back through a steadily revolving door. Prescott and some others were Republicans, while Democrat Averell Harriman built a formidable career for himself in government service, at high levels and in every conceivable capacity, for presidents from FDR to Lyndon Johnson. Partner Robert Lovett, yet another Bonesman in the firm, worked directly as one of Henry Stimson’s “wise men” on foreign policy before being named secretary of defense by President Truman.
The Brown Brothers Harriman group was to a person rabidly Anglophilic. Indeed, the Bushes have long touted their distant familial ties to the House of Windsor. And like the once-great British Empire, the sun never set on the operations of the banking firm. Thus it was that the vanquishing of the German Empire in World War I presented abundant opportunities to invest throughout Europe, and led to extensive financial relationships in German-influenced areas.”
There is also the case of American banker Thomas McKittrick, the WW2-era president of the Bank of International Settlements (BIS). BIS was established in 1930 via a treaty between Germany, Belgium, France, the United Kingdom, Italy, Japan, the United States, and Switzerland. The official purpose of the bank was to facilitate the payment of reparations by Germany after the First World War. Under McKittrick’s leadership, however, BIS “willingly accepted looted Nazi gold, carried out foreign exchange deals for the Reichsbank, and recognized the Nazi invasion and annexation of conquered countries…” McKittrick’s BIS was “so indispensable to the overall Nazi project that the vice-president of the Reichsbank, Emil Puhl—who was later tried for war crimes—once referred to the BIS as the Reichsbank’s only “foreign branch.” Indeed, “McKittrick’s close relationship with Emil Puhl, the vice president of the Reichsbank, was especially valued by [Allen] Dulles and the OSS.”
The Office of Strategic Services (OSS) was formed on September 13, 1942, under the stewardship of William J. Donovan, later nicknamed “Wild Bill.” In 1912, Donovan, who had been a classmate of Franklin D. Roosevelt and studied law under Supreme Court Justice Harlan Fiske Stone while attending Columbia University, helpd form and then lead a troop calvary of the New York National Guard. Four years later, this calvary unit was stationed on the US-Mexico border during America’s war with Pancho Villa. During this same time, Donovan travelled to Berlin on behalf of the Rockefeller Foundation to persuade the governments of Britain and Germany to allow the shipment of food and clothing into Belgium, Serbia, and Poland. In 1920, when JP Morgan & Co. set up the Foreign Commerce Corporation, Donovan treked the globe on behalf of the company mission to “engage in international trade.”
America’s most prominent bourgeois and petit-bourgeois families made up the majority of early OSS agents. “You can hire a second-story man and make him a better second-story man,” Donovan said. “But if you hire a lawyer or an investment banker or a professor, you’ll have something else besides.” Many of these new hires came from Yale. Others, such as Andrew Mellon’s son, were plucked straight from Wall Street itself.
Perhaps the most famous Wall Streeter to make his way into the OSS is Allen Dulles. Allen and his brother, John Foster, worked as business lawyers for Sullivan and Cromwell, an old and firmly bourgeois law firm headquartered in New York City. Some of the firm’s hits include advising John Pierpont Morgan during the creation of Edison General Electric in 1882 and the creation of the US Steel Corporation in 1901. Sullivan and Cromwell was involved in the construction of the Panama Canal and to this day represents the Panama Canal Authority.
While working at Sullivan and Cromwell, the Dulles brothers had made a pretty penny managing massive investments of American capital into IG Farben, Krupp Steel, and other German industrial companies. For instance, in 1927, Rockefeller’s Standard Oil made a deal with IG Farben to “jointly develop high-pressure liquefaction” of coal into oil. “Two years later, I.G. Farben sold all liquefaction rights outside Germany to Standard Oil for 35 million US dollars…and took a 20 percent share in a joint holding company with Standard Oil, as the two corporations defined various spheres of interest.” As Adam Lebor details in Tower of Basel, this agreement set the stage for “a series of powerful cartels” which emerged largely as a result of John Foster’s “pioneering legal work.”
Meanwhile, after joining the OSS, Allen also served as the director of the J. Henry Schroder Banking Corporation, a subsidiary of the British merchant bank created by J. Henry Schroder to finance and refinance German debt after World War 1. John Foster was the Corporation’s attorney. In 1939, Time referred to the Schroder Banking Corporation as, “an economic booster of the Rome-Berlin Axis.”
Unsurprisingly, during the Nuremburg Trials, Allen helped numerous Nazi war criminals flee to Spain, the Middle East, South America, and even the United States itself. Allen, with help from his fellow OSS agent and future founder of the United Nations, John McCloy, also helped former Nazis ease into West Germany’s governing structure and economic institutions, where, as David Talbot notes, “they became essential confederates in Dulles’s rapidly growing intelligence complex.” Speaking to the Council on Foreign Relations, Allen admitted that, “Most men of the caliber required to run the new Germany suffer from a political taint. We have already found that you can’t run railroads without taking in some Nazi Party members.” Thus, instead of finishing the already half-assed process of “de-Nazifying” Germany, Dulles insisted that, “the USA should focus on containing and ultimately destroying the Soviets.”
One front in this war was the foundation of the North Atlantic Treaty Organization (NATO) in 1949. Its purpose was, “to keep the Americans in Europe, the Russians out, and the Germans down.” [Emphasis mine]. Small wonder that several Nazis were immediately appointed to top positions in NATO, including Adolf Heusinger, Operations Chief of the High Command of Hitler’s army, Hans Spiedel, Chief of Staff of the 5th Army Corps on the Eastern Front, Johannes Steinhoff, Luftwaffe fighter pilot during WWII and recipient of the Knights Cross of the Iron Heart (the Nazi military’s highest award) Johann von Kielmansegg, General Staff officer to the High Command of the Wehrmacht between 1942 and 1944, and many others.
A more covert program, later known as Operation Gladio, was arranged and managed by the OSS and later the CIA as a sort of hidden supplement to NATO. It stemmed from an idea originally proposed to Dulles by Nazi intelligence officer Reinhard Gehlen, who sought to build networks of fascist sleeper cells in nations invaded by Hitler. If the SS was forced to retreat these cells could be “activated” to combat the Red Army. Allen and others at the OSS fleshed out Gehlen’s idea into an official program of covert postwar foreign policy that ultimately extended as far as Turkey. To thank Gehlen for his innovation, the OSS incorporated him into the West German State apparatus.
The networks established under Gladio would eventually be connected to those of organized crime. As one Agent put it, “The Mafia, because of its anti-communist nature, is one of the elements which the CIA uses to control Italy.” This policy likely evolved from Operation Underworld, when the Office of Naval Intelligence and the OSS reached out to Murder Inc. to “prevent sabotage and quell uncontrolled leftist unions on New York docks.” As one former White House official put it, “The “dirty little secret of Operation Underworld was that the United States Government needed…organized crime to force an industrial peace and a policing of sabotage on the wharves and in the warehouse.”
This was the logical conclusion of a process that started not long after alcohol was officially banned in the United States in 1929. Canada’s Bronfman brothers, seeing an opportunity to expand their liquor and prostitution chain, “opened export houses along the Saskatchewan-North Dakota border” and cut distribution deals with various soon to be infamous criminals, such as Arnold Rothstein, Meyer Lansky, Charles “Lucky” Luciano, and Arthur ‘Dutch Schultz’ Flegenheimer. Chicago Mob Boss “Big Jim” Colosimo resisted incorporation into the Bronfman network, but his successor, John Torrio, happily obliged. Al Capone, Torrio’s lietenant, “ran Bronfman booze from Saskatchewan to Minneapolis then to Chicago using cars, trucks and the Soo line. Benjamin ‘Bugs’ Siegel and Lansky protected Bronfman liquor shipments across the border against hijackers.”
Samuel Bronfman and Arnold Rothstein brokered a deal with the Distillery Corporation of London (a deal which reportedly involved the King of England) which grew their crime syndicate exponentially. By the time Rothstein died in 1928, this syndicate, a coalition of Italian-American and Jewish-American criminals, was known as Murder Inc. and it wasn’t log before they had formed the Atlas Shipping Company to distribute narcotics. One individual who rose through the ranks of this network was Lewis Rosenstiel.
Rosenstiel, with the help of Lehman Brothers, had acquired bourbon maker Schenley Industries just before 1929. During Prohibition, Schenley acquired a license to produce “medicinal liquor” and it was at this time that Sam Bronfman purchased a 20% stake in the company. Now an official member of the 20th Century bourgeoisie, Rosenstiel started to build “interesting and useful relationships with the likes of FBI Director J. Edgar Hoover and staffers who worked for Senator Joseph McCarthy.”
Towards the end of 1945, Allen Dulles was elected president of the Council on Foreign Relations. Two years later, the Senate Armed Services Committee contacted Dulles for help in creating a new federal intelligence service. In 1946, according to Peter Dale Scott’s The Road to 9/11, Dulles, “formed an advisory group of six men, all but one of whom were Wall Street investment bankers or lawyers.” A year later, the Central Intelligence Agency was created by the National Security Act with its stated purpose being the coordination of military and diplomatic intelligence. According to a government report, “Nowhere in the 1947 Act was the CIA explicitly empowered to collect intelligence or intervene secretly in the affairs of other nations.” Despite this, the National Security Council, created by the same act as the Agency, almost immediately began to authorize the CIA’s covert activities in Europe, Southeast Asia, the Middle East, and Latin America. As Scott notes, ” In fact, these operations were being implemented by an even more secret group within CIA, the Office of Policy Coordination (OPC)” which had been launched by the National Security Council in 1948, “without any congressional authorization at all.”
Funnily enough, the CIA and NSC may not have been if it wasn’t for the victory of Donovan and Dulles in a battle for control of America’s postwar overseas intelligence services launched by J. Edgar Hoover, head of the FBI. As Scott writes:
“From 1945 to 1947 elements in the US Army conspired to maintain contacts with former German anti-Communists in Europe and their German Army commander, General Reinhard Gehlen. Five men were involved, of whom three (William J. Donovan, Allen Dulles, and Frank Wisner) were representatives of the Wall Street overworld and also of the New York Social Register, which listed the members of New York high society. They were awaiting a new agency to succeed Donovan’s Office of Strategic Services (OSS) and take over the Nazis’ ethnic armies in Eastern Europe. But the idea of a centralized intelligence agency encountered fierce competitive opposition from the FBI’s J. Edgar Hoover, who was backed at first by elements of army intelligence.”
Hoover’s gripe with Donovan dated back to 1941, when President Roosevelt appointed his old college buddy to a newly-created post dubbed “Coordinator of Information.” According to Anthony Summers, when Donovan proposed to Roosevelt a peacetime central intelligence organiation, Hoover insisnted that “there was no need for such an agency, and pressed for a return to pre-war arrangements, with the FBI holding the reins.” Hoover, “went on lobbying to secure what he claimed was his turf. Generals and admirals, congressmen and senators were persuaded to plead his cause at the White House…some believed [Hoover’s] claim, dating back to the war, that Donovan’s OSS was ‘hiring a bunch of Bolsheviks.’ A check conducted after the war, by [Hoover’s] own agents, identified no Communists in what remained of the organization.” (Summers, Official and Confidential)
Which brings us back to the role and leverage of organized crime in Cold War intelligence operations. Lewis Rosenstiel’s fourth wife, Susan Kaufman, alleged in court that he routinely organized sex parties where atendees were encouraged to indulge various libertine sexual tendencies. Allegedly, some of the the “debauched” activities simply consisted of crossdressing or engaging in gay sex with other adults. But according to Kaufman, most participants were fond of molesting child prostitutes. And it was through Rosenstiel’s parties that Hoover first met one Roy Cohn. As Summers writes:
“Susan Rosenstiel mentioned to me that she had once possessed a photograph of Hoover in the company of her husband’s mobster friends. That she did have such evidence was confirmed following publication of this book by Mary Nichols of The Philadelphia Enquirer, who met Mrs Rosenstiel years ago. ‘She did have suitcases of photographs that she had hauled away from her marriage to Lewis Rosenstiel,’ Nichols recalled. ‘The ones I saw showed Hoover, lawyer Roy Cohn and Rosenstiel, at all sorts of social events with mobsters.’”
Kaufman alleges that she attended a party thrown by Cohn in Suite 233 of the Manhattan Plaza Hotel, where she witnessed Hoover, Rosenstiel, & Cohn molest several children. Attorney John Klotz later told journalist Burton Hersh: “Roy Cohn was providing protection. There were a bunch of pedophiles involved. That’s where Cohn got his power from — blackmail.”
Cohn exists at the center of a nexus of anticommunist intelligence officials, organized crime, Zionist conservatism, and bourgeois pedophilia and blackmail that crops up contiously in the real history of the Cold War. His father, Albert Cohn, was a prominent member of the New York City Democratic Party, at a time when it was under the control of Edward Flynn. Flynn played a key role in helping Harry Truman succeed FDR as President and his general political influence was so extensive that a famous slogan was later coined in his honor (“In like Flynn”). Indeed, the Bronx Democrats under Flynn maintained close ties to organized crime at the same time Murder Inc was establishing itself as a force to be reckoned with.
As a young man, Cohn attended Horace Mann, a college prepatory school with a dark underbelly. In 2012, New York Times Magazine published an article by a former student of Horace Mann, who claimed that between the mid 1970s to the 1990s a pedophile ring existed within the school. Two weeks after this story broke, Tek Young Lin, Horace Mann’s former chaplain who also served as an English teacher and track coach, admitted to the New York Times that he had molested some of his students. In March 2013, Horace Mann was in negotiations with more than thirty former students for compensation for sexual abuse. In April of that year, The New York Times reported the school had reached a settlement with about 27 of the 37 students identified as having been abused and on May 24 Horace Mann issued a formal apology. Alfred Briggs, a former head of the history department at Horace Mann who “lectured on the evils of communism and Red China” told Vanity Fair, “We need more Roy Cohns in the world. Roy was my best student of all time.”
After studying law at Columbia University, Cohn used his family connections to land a job at the law firm of Irving Saypol. At just 21, Cohn was working for a man Time had dubbed America’s “top legal hunter of communists.” One of the first cases Cohn worked on was the Smiths Act trials of Communist Party leader. That same year Cohn, an ardent supporter of the State of Israel, joined the American Jewish League Against Communism, which believed that “Zionism & Communism are incompatible.” In 1951, Cohn’s anticommunist credentials were boosted yet again when he participated in the trial of Ethel and Julius Rosenberg, two US citizens and members of the Communist Party USA convicted of spying on behalf of the Soviet Union. The Rosenbergs would become the first US citizens to be convicted and executed for espionage during peacetime.
Hoover & Senator Joe McCarthy took note of Cohn’s anticommunism, which convinced McCarthy to appoint Cohn as his general counsel in the run-up to his notorious hearings. Despite Cohn being a gay man with extremely elite ties, he also helped McCarthy with the “Lavender Scare” around this time, which attempted to out suspected queer folks within Hollywood and the government.
According to Hersh:
“Cohn would later reminisce about ‘the first time I met Edgar Hoover,’ in 1952, ‘when I was in charge of this runaway federal grand jury of the Southern District of New York, investigating the infiltration of a substantial number of American Communists into the Secretariat of the United Nations.’ The problem was, since membership in the Communist Party was not a crime for the moment, the grand jury could find no basis to indict. This left the grand jury the option of preparing a report it could release – in legal parlance, a presentment – which identified these individuals and exerted pressure on the UN Secretary-General to fire them all. Cohn rammed this through, against the wishes of his superiors in the Justice Department in Washington.
Here was a maneuver to tickle Hoover’s heart. The Truman administration, Hoover assured Cohn, was teetering and ‘if they fire you, they’ll make a hero out of you, and I will publicly back you up.’ Hoover instructed Cohn to ‘call me directly’ whenever he had something to divulge, since the Justice Department ‘gossips are worse than the perverts in the CIA,’ and were already monitoring Cohn’s office telephones to tip Hoover off that ‘you were an insubordinate little troublemaker, and that I shouldn’t see you.’ For many years after that, Roy Cohn and the FBI director traded favors, effusive compliments, gifts, and elaborate private dinners.”
Anthony Summers claims that sometime in the 1940s, Meyer Lansky obtained compromising photos of Hoover in a “gay situation” and believes these photos were acquired on behalf of Donovan during Hoover’s fued with the CIA. In other words, the men running the newly formed CIA used their Operation Underworld friends in Murder Inc. to blackmail the blackmail the head of the FBI. While this may sound too fantastic to be true, Lansky’s wife claims her husband showed her photos of Hoover in drag. There’s also the fact that, when Cohn was ultimately booted from McCarthy’s comittee, David Peck, a good friend of Allen Dulles, got Cohn a job at prominent New York law firm Saxe, Bacon, and O’Shea. (Interestingly, once Cohn came to Saxe, Bacon, and O’Shea, the firm was infused with a slew of Mafia-linked clients, including members of the Gambino crime family and Lewis Rosenstiel himself)
At the same time that these capitalist cliques were beginning to converge, a form of reactionary religious and political populism was emerging that was, ironically, well funded by the bourgeoisie. Three major trends emerged in this right wing populism; the rise of broadly “anticommunist” and “constitutionalist” groups, groups directly associated with white supremacy and/or Nazi sympathy, and the predecessors to what is today known as the Christian Right. Furtherore, it is worth examining the relationship these organizations had with the Mont Pelerin Society and the role they played in the early “neoliberal” economic movement.
As Recluse notes in his series A Vast Right Wing Conspiracy, “the Patriot movement was not even a true grassroots movement during its inception as many of its early supporters came from upper-middle-class backgrounds.” This includes the John Birch Society, which counted Fred Koch among its eleven founding members. As Sara Diamond writes in Roads to Dominion:
“One detailed study of members’ demographics and political attitudes found the Society’s membership to be disproportionately young, upper middle class, well-educated (in technical fields more than in liberal arts), Protestant fundamentalists in religious orientation, and favorable towards the Republican Party. Membership was strongest in the southern and western regions of the country, and the relatively less populated states, and in areas characterized by recent population influxes. Over 50 percent of those sampled held high-status occupations and earned upper-middle-class incomes. The study suggested a relationship between the Protestant fundamentalism of Society members, with its emphasis on personal sin and responsibility, and their attraction to conspiracy theories, which tend to elevate the casual importance of the misdeeds of individuals over that of larger social forces.”
Once again, the very mechanisms used by “progressive” liberals and/or social democratic reformers, producedthe class forces that result in their irrelevance and impotence to the capitalist system as such. According to University of Georgia historian James C. Cobb, “The South took on the role of health spa for manufacturing industries in their declining years.” But by the 1930s, Southern politicians and capitalists started using increasingly inventive tax breaks and other perks to convince companies to relocate. “The expensive modern pageant of industrial recruitment was largely a Southern invention.”
As Justin Fox reports in the linked article:
“By the mid-1980s…65 of the top 76 counties in terms of the percent of workers employed in manufacturing were in the South. That was partly just an artifact of the rural-skewing nature of Southern manufacturing — paper mills, for example, tend to be located in counties where there isn’t a whole lot else going on. But the economies of some Southern states — Alabama, Arkansas, Mississippi, North Carolina, South Carolina and Tennessee — began to approach and in a few cases surpass the manufacturing intensity of Northern industrial stalwarts such as Indiana, Michigan, Ohio and Wisconsin.”
Even John F. Kennedy wrote an analysis of this trend while still a Senator in the 1950s. As Kennedy observed:
“Nearly 14,000 employees working for the John Doe Company, a New England textile concern, lost their jobs in the period following World War II because of the liquidation of thirteen of their mills. During the same period, the same company opened a large number of new plants in the South. It had “migrated.” Why?…
…For one southern operation, the John Doe Company bought a surplus naval factory at a low price; and for another, it obtained an accelerated tax amortization certificate from the Federal government, authorizing it to depreciate its plant within five years rather than the normal period of twenty to twenty-five years. It also utilized a Federally tax-exempt charitable trust in order to avoid taxes on several of its new southern operations, and negotiated with three southern communities for the building and equipping of more new plants through the issuance of municipal revenue bonds that are exempt from Federal taxation.
Not a single one of the John Doe Company’s southern plants has been organized by a labor union, although attempts at unionization have been made for more than ten years. Injunctions, employer propaganda, and procedural delays under the Taft-Hartley Act have prevented the union from keeping any foothold gained through representation elections. Partly as a result of these maneuvers, the wage scales at the southern plants are all considerably lower than the prevailing union wage scale in the liquidated New England mills. The Bureau of Labor Statistics states that 86 per cent of the woolen textile workers in the southeastern part of the United States operate under contracts calling for minimum entrance rates of $1.05 or less, whereas only 6 per cent of the New England workers have a minimum as low as this. At four plants in South Carolina and Georgia the John Doe Company obtained “learner permits” allowing it to pay many workers, over a period of time, less than the outmoded Federal minimum wage of 75 cents an hour...
…Since 1946, in Massachusetts alone, seventy textile mills have been liquidated, generally for migration or disposition of their assets to plants in the South or other sections of the country. Besides textiles, there have been moves in the machinery, hosiery, apparel, electrical, paper, chemical, and other important industries. Every month of the year some New England manufacturer is approached by public or private southern interests offering various inducements for migration southward. Other manufacturers warn their employees that they must take pay cuts to meet southern competition or face plant liquidations.
In only a small number of cases does direct migration take place through closing New England plants and transferring their operations to southern plants. More often, firms start by operating mills in both New England and the South, then tend to abandon their northern plants in periods of decline and later expand their southern operations when prosperity returns.”
As J. Sakai notes in Settlers, the Keynesian model adopted by American imperialism during and after World War 2 also birthed a booming consumer society:
“The war boom kicked Depression out. Factories were roaring around the clock. The 16 million soldiers and sailors in the armed forces had left places everywhere for the unemployed to fill. The general prosperity that characterized Amerikan society all the way up to the 1970s began right there, in the war economy of WWII…
…The number of supermarkets more than tripled between 1939 and 1944. Publishers reported book sales up 40% by 1943. The pari mutuel gambling take at the race tracks skyrocketed 250% from 1940 to 1944. Just between 1941 and 1942 jewelry sales were up 20-100% by areas. By 1944 the cash and bank accounts held by the US population reached a record $140 Billion. That same year Macys department store in New York City had a sale on Pearl Harbor Day – which produced their most profitable business day ever! Once again, the exceptional life of settler Amerika was renewed by war and conquest. This is the mechanism within each Amerikan cycle of internal conflict and reform. The New Deal was Hiroshima and Nagasaki as well. Consumeristic Amerika was erected on top of the 60 million deaths of World War 2.”
As Sale puts it:
“…upon the enormous growth of the federal government and its unprecedented accumulation of wealth, the great part of which went to develop and sustain the new areas and the new government-dependent industries…”
To understand the dialectal farce at work here, one only has to look at the careful appraisal notorious fascist tech billionairPeter Thiel gave the New Deal in 2011:
“Even during the Great Depression of the 1930s, innovation expanded new and emerging fields as divergent as radio, movies, aeronautics, household appliances, polymer chemistry, and secondary oil recovery. In spite of their many mistakes, the New Dealers pushed technological innovation very hard.
The New Deal deficits, however misguided, were easily repaid by the growth of subsequent decades. During the Great Recession of the 2010s, by contrast, our policy leaders narrowly debate fiscal and monetary questions with much greater erudition, but have adopted a cargo-cult mentality with respect to the question of future innovation.”
The “growth of subsequent decades” also means the rise of the return of the South to the big boys table and the growth of the Southern Rim as a distinct political-economic entity. As Sale explains:
“From 1945 to 1975, the Southern Rim underwent the most massive population expansion in history, from about 40 million people to nearly 80 million people in just three decades, giving the area today a population greater than all but seven foreign countries. Thanks to a complexity of factors—a hospitable climate, the development of air conditioning, water reclamation projects, available space for commercial and private building, the new technologies of communication and transportation—industries and individuals alike poured into new territories of the Rim. Every single one of the fifteen cowboy states grew during this period, some quite spectacularly— Texas by over 100 percent to become the third largest state, California by 200 percent, to become the largest state of all, Florida by 400 percent, Arizona and Nevada by more than 450 percent—and as a whole they have consistently made up nearly half of the growth that the nation as a whole has undergone.
Migrations every year since World War II have poured millions of new people into the area—on average about 650,000 newcomers every year, turning bucolic farmlands into sprawling suburbs and little crossroads cowtowns into gleaming metropolitan centers. The cities have grown unlike any urban areas in the world, 500 and 800 and 1,000 percent in just this thirty-year span… today there are actually more cities over 100,000 people in this area than there are in the Northeast…
…there has been a shift from the traditional heavy manufacturing long associated with the Industrial Belt of the Northeast to the new technological industries that have grown up in the Southern Rim—aerospace, defense, electronics—and from the dependency upon railroad transportation to the growth of air and highway transportation, both relatively more important in the Southern Rim. Similarly, in the use of natural resources there has been a development away from coal and heavy metals such as iron and steel, the resources of the Northeast, toward oil and natural gas and the light metals such as aluminum and titanium, the products of the Southern Rim. And in agriculture, new technologies have favored large-scale and often corporate farming, advantageous particularly where space is plentiful, growing seasons are long, and the crops are suitable, and that turns out to be the Southern Rim.
Finally, trends in employment patterns over this thirty-year period have also tended to tilt things toward the cowboy economy. The single most important development has been the gradual decrease in blue-collar industrial workers—these the backbone of the Industrial Belt—and the sharp increase in service and government workers—these the ones most important in the newly populated states with expanding governments and in the tourist-and-retirement areas like Florida, Texas, Arizona, and Southern California; especially in the booming new Rim cities, service employment has enormously increased, in fact by more than 70 percent over the last twenty years, as against 6 percent in the older cities of the Northeast. In like nature, the employment shifts brought about by postwar programs of paid retirement, the expansion of Social Security, and union-won benefits for longer vacations and shorter hours have all meant more earlier retirements to the sunnier parts of the land and more emphasis upon climatic amenities as an inducement for resettlement of the labor force.”
As these developments were playing out in the South and Southwest, seed money for the various right wing populist movements that would recruit heaviest from the South was flowing from the capitalists of the East. Some of this capital even came from men with ties to the very founding of the United States. For instance, the American Coalition of Patriotic Societies (ACPS) was founded by a former militiary intelligence officer named John Trevor Sr, who received the capital to start his group from Wickliffe P. Draper. Draper was not only a fellow military intelligence officer, but a descendant of the Draper Family.
As William H. Tucker explains in The Funding of Scientific Racism:
“Proud of their colonial roots dating back to James ‘the Puritan’ Draper, who had left the village of Heptonstall in Yorkshire, England and settled in the New World in 1648, the ‘Draper men,’ according to the genealogy, ‘have ever been to the front in all emergencies… have held offices of all kinds in the village, town, city, county, or country… have been soldiers, sailors, statesmen, lawyers, doctors, engineers, authors, merchants, farmers, manufacturers, in the church and school, and have brought to each and every one of these occupations an earnestness and steadfastness of purpose and success of the highest order.’ Nine towns or counties in the United States, and one in the United Kingdom, had been named after the family.
The line leading directly to Wickliffe Draper was particularly distinguished. His great-great-grandfather Abijah Draper had fought at Lexington and Concord and commanded a company of minutemen under Washington at Roxbury. Abijah’s son Ira invented the rotary temple, a device for keeping the cloth extended in weaving that doubled output by allowing a single weaver to attend two looms; by the time Wickliffe was a teenager, the business built around his great-grandfather’s invention was the largest manufacturer of textile machinery in the world…
…In 1935, Draper had traveled to Berlin, where the International Congress for the Scientific Investigation of Population Problems was being held, to learn first hand what sort of eugenic measures were being enacted by the Nazi government. To facilitate his contact with officials and scientists in the Reich, Laughlin had written to Eugen Fischer, president of the International Congress and an important scientific authority for the Reich, naming Draper as one of the two official delegates from the Eugenics Research Association (ERA) and commending him as ‘one of the staunchest supporters of eugenical research and policy in the United States’…
…According to Marshall Ravnitzky, a reporter for the National Law Journal, the Federal Bureau of Investigation has been withholding records on Draper’s involvement with the Reich under an inappropriate application of classification rules to files more than fifty years old.“
In 1937, Wickliffe Draper established the Pioneer Fund, a non-profit foundation which still exists. Among the Fund’s early projects was the funding and distribution of a pro-eugenics Nazi propaganda film in American schools and churches. Research funded by the group would later make its way into the mainstream via a highly-controversial book published in the 1990s titled The Bell Curve. Furthermore, John Trevor Jr., the son of ACPS founder John Trevor Sr., would sit on the board of Pioneer Fund alongside Roger Pearson. Pearson worked closely a man named Willis Carto, a white nationalist who founded the Liberty Lobby in 1958, not long after the Birchers got rolling.
On the Liberty Lobby’s board of directors sat General Pedro Del Valle, commander of the 1st Marine Division in the Pacific Theater of Operations during World War II. Before joining Liberty Lobby, Del Valle had himself founded the Defenders of the American Constitution (DAC) with Colonel Matthew O. McKeon, Gordon Small, and Josephine Powell Beaty. Del Valle belonged to several other right wing organizations over the course of his career, including the National Economic Council, Christian Crusade, National Youth Alliance (another Carto project), and the Committee to Restore the Constitution. He also was a member of a secret society dubbed the Sovereign Order of Saint John (SOSJ).
The founder of the SOSJ, according to historian Kevin Coogan, was Charles Pichel. “Active in the far right” by the early 1930s, Pichel eventually partnered with Boris Brasol, “a leading White Russian anti-Semite, intelligence operative, criminologist, literary figure, and founder of the Union of Czarist Army and Navy Officers.” Brasol was said “to have been a representative of a Nazi propaganda organization called the Fichte Bund, and was close to the Cossack General Grigori Semionov, who was financed by Japan.” In June 1922, as Coogan writes:
“The well-known journalist Norman Hapgood ran a series of exposes in Hearst’s International entitled ‘The Inside Story of Henry Ford’s Jew Mania.’ In it, Cherep-Spiridovich and Brasol were identified as the two most influential figures behind Ford. According to Hapgood, Cherep-Spiridovich at one point lived in Detroit and worked for Ford. He also identified another Russian friend of Brasol’s involved with the Protocols, a former diplomat and Hereditary Knight Commander in Pichel’s order named Boris Bakhmeteff.
As for Brasol, his ties to Ford evolved out of an earlier connection to American military intelligence. One of his ex-military intelligence cronies was C.C. Daniels, then head of the Ford Detective Agency in New York and the brother of Secretary of the Navy Josephus Daniels. Dr. Harris Houghton, C.C. Daniel’s family physician and the New York head of Army Intelligence, was also close to Brasol. After World War I, Houghton created the Beckwith Company to publish tracts like the Protocols…
…Brasol spread the Protocols in league with the Grand Duke Kirill. Kirill and his chief aide-de-camp General Vasily Biskupsky appear to have received financial support from Henry Ford, with Brasol serving as their intermediary…
...Grand Duke Kirill had another supporter on the American far right: Charles Pichel. Pichel reports that on 13 January 1934, ‘the late Grand Duke Kirill, acting officially as Kirill Wladimirovich (Kirill I)’ from his place in exile in Saint Briac, France, confirmed the legitimacy of Pichel’s Order. Two years later, in a proclamation dated 24 November 1936, he conferred upon Pichel ‘the Order of St. Andrew the Apostle, First Class in Gold’ for his ‘zeal in defending and helping to perpetuate the noble history of Imperial Russia and the Imperial Families of Russia.’ Kirill’s order was ‘signed by the President of the Committee of Imperial Orders and the Delegate of the Emperor in the United States,’ presumably Brasol.“
Grand Duke Kirill was a first cousin of Nicholas II, the last Tsar of Russia before the Bolshevik Revolution of 1917. When Nicholas II and his family were purged in the revolution, Kirill named himself the Tsar-In-Exile and became a leader to some remnants of the Russian Imperial Family. This would partially explain the SOSJ’s hawkish anticommunist line, which by the 1950s would appeal to numerous high ranking military officers, including Del Valle. Gen. Lemuel C. Sheppard, Lieutenant General George E. Stratemeyer, Major General Charles A. Willoughby, Brigadier General Boner Fellers, Admiral Charles M. Cooke, and seven retired U.S. Navy rear admirals sat on the SOSJ’s “Military Affairs Commitee.” According to Coogan, “Both Willoughby and Del Valle had been close allies of General Douglas MacArthur. In order to overcome the MacArthur network’s opposition to CIA activity in Asia, CIA Director Walter Bedell Smith once tried to interest Del Valle in heading a CIA office in Tokyo, but without success.”
Meanwhile, a new movement in Christianity was coalescing around figures such as Norman Vincent Peale. Peale was a protestant clergyman who practically invented the self-help movement as we know it in his famous book, The Power of Positive Thinking, which instructed the reader on “overcoming inadequacy attitudes and learning to practice faith.” In one 1955 article, prominent psychiatrist RC Murphy compared Peale’s methods to hypnosis, writing that, “self knowledge, in Mr. Peale’s understanding, is unequivocally bad; self hypnosis is good.” Murphy alleged that such self-hypnosis diminishes one’s critical thinking skills, defeats self-motivation, and confuses one’s sense of reality. Albert Ellis, another influential psychologist, echoed Murphy’s criticism, comparing Peale to the French psychologist and pioneer of “optimistic autosuggestion” Émile Coué. Ellis insisted that Peale’s methods, “lead to failure and disillusionment, and not only boomerang back against people, but often prejudice them against effective therapy.”
Similar to Cohn, Peale is something of a nexus figure, located at the intersection of the type of right-populism stage managed by military generals, the burgeoning Religious Right and the early neoliberal movement. For instance, he was a member of four conservative organizations between 1935 and 1955 which, as Carol VR George notes, provided the “training ground for his own ministry.” These were the publishing tycoon Frank Gannett’s National Committee to Uphold Constitutional Government (NCUCC), Spiritual Mobilization, the Christian Freedom Foundation, and Texas oilman HL Hunt’s Facts Forum.
At least one member of NCUCC, Amos Pinchot, would become involved in the America First movement during World War 2. Meanwhile, Spiritual Mobilization, started by neo-Calvinist minister James W. Fifield Jr., attracted the attention of Sunoco Oil capitalist J. Howard Pew. As Chris Lehman noted, Spiritual Mobilization, “was dedicated to the defeat of ‘pagan stateism’ as practiced by the brain trust in FDR’s Washington, and was closely aligned with ambitious libertarian initiatives such as Leonard Read’s Economic Freedom Forum, which would later oversee the widespread disbursal of libertarian textbooks and teaching curricula in California public schools.”
Peale also briefly chaired, Pew’s own organization, the Christian Freedom Foundation. The Christian Freedom Foundation published a journal called Christian Economics that promoted an early version of the Prosperity Gospel. This line was no doubt influenced by Pew’s membership in the Mont Pelerin Society, formed by German economist and philosopher Friedrich Hayek in 1947. Interstingly, Hayek got the seed money for this venture from a textile kingpin named William Volker, who also subsidized the publishing of Hayek’s The Road to Serfdom in the United States. As Jeff Sharlett writes in The Family:
“First published in the United States by the University of Chicago Press, the book appeared in shortened versions produced by Reader’s Digest and Look magazine, which illustrated Hayek’s argument that any attempt at ‘central planning’ (including FDR-style government regulation of big business) would send society down a ‘road to serfdom’ –and mass murder along the lines of Hitler and Stalin –from which there was no return. Hayek’s economic ideas were considerably more complex than the uses to which they were put, but as understood by the American public… they seemed to lend scientific imprimatur to the Manichean world view of the country’s most rabid red hunters.”
As Harvey explains in A Brief History of Neoliberalism:
“The Mont Pelerin group garnered financial and political support. In the US in particular, a powerful group of wealthy individuals and corporate leaders who were viscerally opposed to all forms of state intervention and regulation, and even to internationalism sought to organize opposition to what they saw as an emerging consensus for pursuing a mixed economy. Fearful of how the alliance with the Soviet Union and the command economy constructed within the US during the Second World War might play out politically in a post-war setting, they were ready to embrace anything from McCarthyism to neoliberal think-tanks to protect and enhance their power.”
The “powerful group of wealthy individuals and corporate leaders” Harvey refers to are the same people who ultimately formed groups like the American Security Council. As Sara Diamond notes in her study of America’s far right Roads to Dominion:
“One study of corporate anticommunist education programs traced the trend to the 1947 Taft-Hartley Act which granted employers the right to distribute literature to counter labor union organizing. By 1963, corporations were spending an estimated $25 million per year on anticommunist literature distributed to consumers and to employees at the job site. Sponsoring corporations included major firms such as Goodyear Tire, Minnesota Mining, Boeing Airplane Co., Jones & Laughlin Steel, Texas Power & Light, as well as smaller companies that came to be associated with grassroots groups like the John Birch Society: Knott’s Berry Farm, Dr. Ross Dog Food, Cherokee Textile Mills, Allen-Bradley Corporation, and others. Some corporations circulated print and audio-visual materials produced by the John Birch Society; other companies produced their own in-house literature. Coast Federal Savings and Loan Association in Los Angeles conducted one of the largest customer education programs, distributing millions of leaflets and booklets at a cost of about $250,000 a year.”
One beneficiary of this massive movement of capital into right-populism and Christian fundamentalism during the early 20th Century was Abram (also spelled Abraham) Veriede, a Methodist minister whose religious work took a particularly anti-union turn at the beginning of the 1930s. Unsurprisingly, an early investor in Veriede’s efforts was William Volker, via a tax-exempt, charitable fund he had established in 1932. “A decade later,” Sharlett writes in The Family, “the Volker Fund would hire Rousas John Rushdoony, a theologian who was to the far right of fundamentalism what Hayek was to economic conservatism; it was Rushdoony who helped marry the two with extensive writings on theonomy, a jargon term for what Abram’s descendants would come to call biblical capitalism.” In April 1935, while living in Seattle, Veriede claims had a vision, and, with the help of a “developer of means” and “former major” in the military named Walter Douglas, secured further backing from William St. Clair “one of the wealthiest men in Seattle.” According to Sharlett:
“St. Clair made a list of nineteen businessmen and invited them to breakfast at one of the city’s finest hotels. St. Clair certainly didn’t choose on the basis of Christian morality. Of the nineteen, only one was a churchgoer, and he pointed out at the first meeting that the other men there knew him mainly as a creature of cocktail lounges and poker tables. Among the nineteen sat a lumber baron, a gas executive, a railroad executive, a hardware magnet, a candy impresario, and two future majors of Seattle. ‘Management and labor got together,’ Abram would later claim, but there were no union representatives at the meeting, where nineteen businessmen plus Abram agreed to use the ‘Bible as blueprint’ with which to take back first the city, then the state, and perhaps the nation from the grip of godless organized labor.“
Three years earlier, “Abram took as a Bible student Henry Ford…Ford’s wife heard Abram speak in Detroit and insisted that he meet with her husband, no doubt guessing that Abram’s theology of biblical capitalism would sit well with the tycoon, an eccentric religious thinker who had been raised on populist American fundamentalism. Abram and Ford traded Bible verses through a series of meetings in Ford’s offices, and then Ford invited Abram to his home in Sudbury, Massachusetts.” The connections between Abram, monopoly capital, the burgeoning National Security State and fascism wouldn’t end there:
“After the war, another major American fascist sympathizer-Charles Lindberg-would preside for a brief period” over a roup modeled on Beam’s original. In turn, Lindbergh was associated with Merwin K. Hart, named as an “alleged promoter of the American Fascist movement” by the WW2-era FBI and, as Sharlett writes, “denounced publicly as a Nazi in all but name by Robert H. Jackson, the FDR-era attorney general who went on to serve as a justice of the Supreme Court and chief prosecutor at Nuremberg.” From an office in the Empire State Building, Hart, who Abram considered a “dapper habitue of New York’s blue blood clubs” organized, “business executives bent on breaking the spine of unionism into an organization called the National Economic Council” (Recall that General Pedro del Valle worked with this same organization). From the ranks of the National Economic Council Hart, “selected men for the Fellowship whose devotion to the antilabor cause was religious in intensity.”
In 1935, the same year that Abram had his “vision”, another preacher named Frank Buchman was “at the height of his power.” Buchman’s Moral Re-Armament movement spouted slogans such as “Not Left, Not Right, But Straight” while Buchman himself preached sermons with such messages as “There is a tremoundous power in a minority guided by God” and “I thank heaven for a man like Adolf Hitler, who built a front line of defence against the anti-Christ of Communism.” For Buchman, “in a God-controlled nation, capital and labor would discuss their problems peacefully and reach God-controlled situations.” Buchman would greatly influence the direction Abram went in with his own theological style and also his “man-method” approach to organizing “cells” of followers without any central leadership (as will be discussed in a future installment, this bears a striking similarity to the concept of “leaderless resistance” adopted by White Power leader Louis Beam decades later).
By the 1940s, Abram also had ties to some of the wealthiest capitalists and most powerful politicians in America. He met with the president of Chevrolet, the president of Quaker Oats, the president of Gneral Electric, had dinner with Chicago’s steel magnates and the president of Marshall Field, and spoke at Banker’s Club meeting organized by IBM’s Thomas Watson in New York City. “JC Penney, one of the financial baackers of modern fundamentalism, took Abram to Marble Collegiate Church on Fifth Avenue to meet Norman Vincent Peale…Abram soon joined Peale as one of ‘the Twelve,’ a council of Christian conservative leaders bent on working behind-the-scenes to rebrand fundamentalism in Peale’s feel-good terminology.” In Washington DC, “Senators Alexander Wiley of Wisconsin, Raymond Willis of Indiana, and H. Alexander Smith of New Jersey functioned as his lieutenants. Represenative Walter Judd…later to become a red hunter nearly as cruel as McCarthy, became Abram’s man on the House floor. David Lawrence, publisher of US News, the most influential media conservative in the country, joined the board of directors of Abram’s newly formed National Committee for Christian Leadership.” Strom Thurmond, the essentially neo-Confederate Dixiecrat (who later became a Reagan Republican) became a coleader with Abram of the Senate’s weekly prayer breakfast.
Then, in 1946:
“Abram undertook a mission to scour the Allied prisons in Germany for men ‘of the predictable type’ ready to turn their allegiance from Hitler to Christ, and thus, in Abram’s thinking, America. In later years, Abram would say he had gone at the U.S. State Department’s request, and while it’s true that the State Department did send Abram and provide any support he needed, it was Abram who initiated the trip, writing to Undersecretary of State major John H. Hildring that the men of the Senate and House prayer groups had insisted that Abram carry ‘the Idea’ to defeated Germany. Abram sailed on the Queen Mary in June, launched a prayer cell of Swiss bankers in Zürich, and flew from Frankfurt to Berlin on the private plane of General Joseph T. McNarney, commander in chief of the U.S. Forces of Occupation, to meet with General Lucius D. Clay, soon to take over from Eisenhower as military governor. Everywhere he met with the ‘Christian forces of Germany’ – those who saw Germany suffering as penance for its embrace of the tolitarianism of a man rather than that of God. He found them all weeping, he wrote his wife, crying for their Fuhrer, for the thousand-year Reich in the grave at age twelve, for the dead and the missing and the blank-eyed boys who had stumbled home in retreat from the Russians. In the West he wept with them; in East Berlin, he prayed with ‘secret cells’ of Christians determined to overthrow communism. Even in the West, he believed ‘atheistic devotees’ of subversion – that is, those with strong anti-Nazi records, concentration camp survivors – had been elevated by an American military government blind to the threat posed by its eastern ally. ‘Nominal membership’ in the Nazi Party was being held against good Christians with the necessary experience to govern. A coalition of leading German churchmen begged him to intervene, asking only that none the Christians be given authority.
In Frankfurt Abram, with the churchmen and the pillars of the Third Reich to whom they introduced him, ‘the most intelligent, honest and reliable people of Germany,’ settled on a plan. They would provide Abram with a list of imprisoned men, ‘war criminals’ according to the view of a certain un-Christian element among the Allies. Abram’s friends in the military government and back home in Washington would certify them as men not only to be released but to be used, according to their ability in the tremendous task of reconstruction. That September, U.S. secretary of state Jimmy Byrnes, under the advice of General Clay, delivered in Stuttgart a world-changing address, ‘Restatement of Policy on Germany.’ The burden of reparations would be lessened, Germany would be allowed to keep more of its industrial base, and the purge of National Socialism would soon come to an end: ‘It never was the intention of the American government to deny the German people the right to manage their own internal affairs as soon as they were able to do so in a democratic way.’“
Bringing us full circle, Andrew Mellon, alongside Howard J. Pew and members of the Du Pont family, was a contributor to the American Liberty League. The Liberty League was not only a lobbying firm, but also helped other conservative, anti-New Deal think tanks and nonprofits secure funding for their own reactionary endeavors. Started in 1934 by a group of Democrats and Republicans, the Liberty League’s mission statement read:
“It shall be a non-partisan organization. The particular business and objects of the Society shall be to defend and uphold the Constitution of the United States and to gather and disseminate information that (1) wiII teach the necessity of respect _ the rights of persons and property as fundamental to every successful form of government and (2) wiII teach the duty of government to encourage and protect individual and group initiative and enterprise, to foster the right to work, earn, save and acquire property, and to preserve the ownership and lawful use of property when acquired.“
As Grace Hutchins wrote in a pamphlet published when the Liberty League was still in existence:
“In relation to labor, the Liberty League’s program has always been against every progressive measure that is in the interest of the workers or of labor organizations. In opposing the National Labor Relations Act because it stated that workers have the right to organize in unions of their own choosing, the League feared the act would strengthen the American Federation of Labor and ‘tend to give one labor organization embracing only one-eighth of the workers of the country a monopoly in collective bargaining’…On the all-important question of relief for 15,000,000 unemployed persons in the United States, the League, like the Republican platform, favors “strict economy” and attacks expenditures for the Public Works Administration and the Works Progress Administration as extravagant, “wasteful, inefficient”...In relation to employers, the League is in favor of everything that will aid private ·business and increase profits on capital. It maintains that ‘the American system of private enterprise should not be handicapped by restricted and coercive legislation’.”
One group the Liberty League regularly worked with was the Sentintels of the Republic, founded before the Depression and New Deal in 1922. The Sentinels formed as a collaboration between several secretive groups with similar concerns, including The Sons of the Revolution, founded by prominent banker John Austin Stevens whose grandfather, Ebenezer Stevens, had participated in the Boston Tea Party and later became a lieutenant colonel during the 1776 War of Independence. The Society of Cincinatti, co-founded by Ebenezer Stevens with Alexander Hamilton in 1783, was another group that contributed to the founding of the Sentinels, whose early funding, once again, came mostly from the ultra-wealthy members of the ruling class. Raymond Pitcairn, the billionaire son of PPG Industries founder John Pitcain Jr, singlehandedly saved the Sentintels from dissolution in 1935 with a generous doantion of $85,000 (over $1.5 million in today’s money). Other wealthy benefactors of the Sentintels include the by-now usual suspects, including J. Howard Pew, the du Ponts, and JP Morgan & Co. When responding to allegations of antisemitism and Nazi sympathy within the group, Sentinels leader W. Cleveland Runyon once said, “The old-line Americans of $1,200 a year want a Hitler.”
One passage from Hutchins pamphlet is particularly illuminating
“Among the large contributors to the American Liberty League who gave also to the Republican National Committee, in 1932, 1934 or 1935, are the following representatives of big business:
Sewell L. Avery, R. R. M. Carpenter, W. S. Carpenter Jr., S. T. Crapo, George W; Crawford, Irenee du Pont, Lammot du Pont, William du Pont, Howard Heinz, Edward F. Hutton, George M.
Moffett, Rufus L. Patterson, J. Howard Pew, Mrs.. A. Hamilton Rice, Alfred P. Sloan Jr., and Ernest T. Weir…Their contributions to the Republican committee ranged in size from $1,000
to over $35,000.
During the 1936 election campaign, however, prominent Liberty Leaguers thought it more important to give directly to the Republican Party than to the League: “The reports indicated that the du Pont family, which contributed a large part of the Liberty League’s funds last year, has transferred its support for the election year to the Republicans.” (New York Times, March 14, 1936.)
Lammot du Pont, one of the chief supporters of the League and of all its associated organizations in the preceding eighteen months, in 1936 gave $5,000 to the Republican National Committee and $1,666 to the Republican Congressional Committee. Alfred P. Sloan Jr. and Earl F. Reed were among the other backers of the Liberty League who gave $5,000 each to the Republican National Committee for its 1936 election campaign.
But the League claims to be “non-partisan:” In other words, it aims to bring together the most reactionary circles of both old parties and unite them in common opposition to the progressives of both parties. It claims to have within its membership “thousands of Republicans” and “thousands of Democrats.”
Former Democrats, now prominently associated with the Liberty League…include the five mentioned above as signing the statement to the Democratic National Convention, Smith, Ely, Reed, Cohalan and Colby; and also John J. Raskob and Jouett Shouse. Pierre S. du Pont, who gave $15,000 to the Democratic National Committee in 1932 and $50,000 in 1928, gave $5,300 to the American Liberty League and $5,000 to the Southern Committee to Uphold the Constitution, as noted above, during the year and a half ending in the Spring of 1936.“
In 1947, the same year that the CIA, Mont Pelerin Society, and 2nd Red Scare reared their ugly heads, Richard Nixon ran to represent California’s twelfth congressional district on a firmly anticommunist platform. Once in congress, Nixon joined the House Un-American Activities Committee and sponsored the Taft-Hartley Act. Nixon collaborated with FBI asset Father John Francis Cronin, who authored a pamphlet in 1945 titled The Problem of American Communism. Cronin wrote this pamphlet with help from FBI agent William C. Sullivan. By 1950, Nixon had become California’s Senator and grown close to Senator McCarthy. Three years later, he became Dwight D. Eisenhower’s Vice President at the same time John Foster Dulles was Secretary of State. Nixon would later develop a close personal relationship with Norman Vincent Peale.
Meanwhile, as organized crime specialist Dan E. Moldea notes, from his arrival in Hollywood in the late 1930s , throughout the peak of his acting career and SAG Presidency, to his time as Governor of California, Ronald Reagan “was an invention of the Hollywood conglomerate, MCA” which “with the help of the Mafia, was the most powerful force in Hollywood from the mid-1940s until the Bronfman family purchased the company in 1995.” In 1940, when MCA bought out Reagan’s talent agency, Lew Wasserman became Reagan’s personal agent, negotiating a million dollar contract with Warner Brothers on the actor’s behalf. By 1946, one year before Reagan became president of SAG, Wasserman was running MCA.
Wasserman cut his teeth as a member of the “predominantly Italian Mayfield Road Gang.” Mayfield and “its predominantly Jewish counterpart, the Cleveland Syndicate” were run by Meyer Lansky underling Moe Dalitz, the daughter of whom Wasserman would eventually marry. Wasserman maintained contact with the underworlds of both Cleveland and Chicago and “MCA’s ascendance in Hollywood in the late 30s was simultaneous with the Chicago Mob’s infiltration, through union control, of the movie business, and with Sidney Korshak’s own move to the Coast, Wasserman was perhaps the most powerful and revered figure in Hollywood.” Korshack, a powerful fixer for the Chicago Mob, was one of Wasserman’s best friends.
Likewise, as Daniel S. Luck writes in Reconsidering Reagan:
“As Hoover fixated his gaze on extirpating alleged Communists from Hollywood, he noticed Reagan and his political activities showing up in reports from the FBI’s Los Angeles field office…Hoover was eager to cultivate more informers in Hollywood, and he was aware that Reagan’s brother, Neil, a conservative advertising executive in Los Angeles, was working as an informer in the FBI’s investigation of the entertainment industry. Hoover also knew that Guthrie, the former FBI agent had helped secure Reagan’s comfortable job at the Hal Roach Studio in Culver City, and he thought that Reagan’s image as a wholesome all-American man might make him a good prospect in the quest to ferret out Communists in the film colony.
Despite Reagan’s initial hesitation to get involved in informing, he changed his mind after the agents told him that the Communists in Hollywood despised him and had just held a meeting where someone said, “What are we going to do about that son-of-a-bitching bastard Reagan?” Later, he came to believe that the Soviets were not only intent on gaining control of Hollywood but also striving to influence the content of its films…His contacts with the FBI would become regular enough that Reagan earned the informer’s number T-10. Over the years, Reagan’s relationship with the FBI deepened; during the 1960s, Hoover would lend his power to aid Reagan’s political rise in California.”
Through his Mob-appointed leadership in the Screen Actors Guild, Reagan, whose personal politics at the time amounted to stereotypical Cold War liberalism, transformed into a hardened anticommunist, a staunch supporter of neoliberal economics, and an unequivocal racist. Luck points out that Reagan’s SAG leadership coincided with “the labor strife that convulsed Hollywood from 1945 through 1947” (itself part of a larger strike wave that swept America after World War 2). Despite Reagan’s anxieties that the Hollywood strikes were caused by Communist subversion, they were, “rooted in a complex and ferocious jurisdictional dispute that predated Reagan’s arrival and had nothing to do with the Soviet Union.” Instead, as Luck notes, it “involved a bitter struggle over control of the film industry pitting the newly formed Conference of Studio Unions (CSU) against the corrupt, Mafia-infested International Alliance of Theatrical Stage Employees (IATSE), one of the oldest and most powerful unions in the movie business.”
After a long and violent dispute between the two unions, Reagan stepped in personally:
“A month after CSU’s second strike, Reagan delivered a powerful address before a tumultuous crowd of SAG members at the Hollywood Legion Stadium in which he presented the board’s recommendation against supporting the strike. Reagan’s captivating speech helped sway SAG members to vote to cross the picket line. Shortly thereafter, violence and mayhem flared again on the Warner Brothers lot in Burbank as pitched battles between the police and union members resulted in property damage and bodily injury. Reagan, a recipient of anonymous threats, began to carry a .32 Smith & Wesson. The strike went on for months and led to the largest mass arrest in California history after strikers violated a court order limiting the number of pickets outside studio gates. By the end of 1947, however, without SAG’s support, the CSU ‘dissolved like sugar in hot water’…”
Throughout this dispute, Reagan was privately providing the names of suspected Communists to the FBI. Likewise, he was adopting Hoover’s virulent and hysterical racism. To quote Luck once more:
“…Whatever youthful commitment Reagan harbored for the evil of racism vanished when he became an FBI informant and messianic anti-Communist amid the Hollywood labor strife of the 1940s. By the mid-1950s, Reagan would find common cause with a burgeoning movement of fellow conservatives that clashed with the onset of the modern phase of the civil rights movement…
…In 1954, with Reagan’s acting career in steep decline, MCA secured him a lucrative contract with General Electric to become the host of its General Electric Theater, the first major production of MCA’s new television unit, Revue Productions…Besides hosting the Sunday evening broadcast of GE Theater, Reagan served as a corporate pitchman and roving goodwill ambassador for GE, traveling at least sixteen weeks a year. It was this work that drove his metamorphosis from actor to politician. He visited all of GE’s 139 plants across the US and delivered thousands of speeches to approximately a quarter of a million employees…
…After the war, GE had also been beset by labor strife. Like many other corporations at the time, GE was closing plants in the industrial North and moving to the South, where labor costs were low and unions were weak. However, under the leadership of Lemuel Ricketts Boulware, an ardent conservative who served a GE executive, none of GE’s sixteen thousand workers went on strike. GE took notice and promoted Boulware to vice president of labor and community relations. In this capacity, Boulware eliminated labor unrest among company workers by cultivating GE’s image as a benevolent employer. He also hired Reagan, who had just resigned as SAG president, to spread the anti-union gospel to GE’s many thousands of blue-collar workers that their interests were in harmony with the company’s. Boulware also became a mentor to Reagan and a benefactor to National Review and other conservative causes…
…it wasn’t until William F. Buckley Jr. launched National Review in 1955 that conservativism gained intellectual coherence. On racial issues, both Buckley and the National Review were infused with a virulent dose of racism that had infected the conservative movement since its inception…a number of National Review’s contributors endorsed pseudoscientific racist opinions about Blacks’ inherent racial inferiority. By fusing the disparate strands of militant anti-Communism, libertarianism, and traditionalism into a comprehensible, if unwieldy, intellectual movement, National Review founded modern conservatism…
William F. Buckley Jr. was a Yale graduate who had been a part of the highly secretive Skull and Bones fraternity at the same time as George Herbert Walker Bush, descendant of the aforementioned Prescott Bush. Buckley served for in the US Army during World War 2 then served a two year stint in the CIA, where he worked under E. Howard Hunt. Buckley’s first book, God and Man at Yale, was printed by Regnery Publishing, which was started in 1947 by Henry Regnery, son of William H. Regnery, a textile businessman who eventually purchased the Western Shade Cloth Company from William Volker. William H. Regnery would also help his friend General Robert Wood, chairman of Sears Roebuck, lead the America First Commitee, an “anti-interventionist” organization formed during World War 2 which was later revealed to have extensive ties to the Nazis. The pair would later help establish the American Security Council in 1955, the same year Buckley started to publish his National Review.
In spite of this coalition’s best efforts, its cultural hegemony and consolidation of former political power wouldn’t fully began until the mid 1970s. The economics and global geopolitics that made this possible will be discussed in the next installment of this series. For now, I would like to mention one final series of interlocks that highlights how, by the time this coalition finally did come to power, it had not only streamlined its operations and smoothed over many of the competitive contradictions within its own ranks, but had crystalized into something resembling an covert fascist party in its own right.
As Russ Bellant writes in Old Nazis, the New Right, and the Republican Party, when the aforementioned neo-Nazi Roger Pearson moved to the United States in 1965, he merged
“…his magazine Northern World with a Willis Carto publication to form Western Destiny, which Pearson edited for a short time. The magazine had over two dozen racialists and anti-Semites on its masthead, including Austin App and C.M. Goethe, honorary president of the American Coalition of Patriotic Societies. Pearson published four monographs in 1966 that represent the core of his ideas. One monograph, titled Race and Civilization, was ‘based on Professor Hans F. K. Gunther’s Racial Elements of European Civilization. Gunther was a top Third Reich racial theoretician and Pearson associate from the Northern League…
Pearson’s monograms are still offered by neo-Nazi booksellers today. The Wall Street Journal quoted Pearson as saying ‘I’m not ashamed of anything I’ve said or written.’
Pearson moved to Washington in 1975. Within a year his Council on American Affairs was sponsoring seminars and publishing monograms with persons such as Edwin Fuelner, president of the Heritage Foundation; Ray Cline, former CIA. deputy director; and others who would later become high officials of the Reagan Administration. His Council also became the US chapter of the World Anti-Communist League (WACL), an international network including fascist, followers of the authoritarian Korean cult-leader Rev. Sun Myung Moon, and neo-Nazis.
Pearson became the editor of the American Security Council’s Journal of International Relations and served on the board of the ASC’s American Foreign Policy Institute. His journal co-editors were James Jesus Angleton, former CIA deputy director for counterintelligence, and Robert C. Richardson III, the retired Air Force general who worked in the Air Force’s Politico-Military covert operations branch….
Pearson was a member of the editorial board of Policy Review, the monthly Heritage Foundation magazine, during this period. In 1977, Heritage officials reciprocated, joining Pearson’s Journal of Social and Economic Studies. When Pearson decided to host the 1978 World Anti-Communist League (WACL) conference in Washington, DC., he was well established with American and European Nazi networks, as well as the far right of the Republican Party and the New Right. The WACL meeting was not a total success for Pearson, however. The Washington Post warned of ‘The Fascist Specter’ behind the WACL and highlighted the conference participation of an Italian fascist party, American neo-Nazis, and Pearson’s own racialist background. Pearson’s name soon disappeared from the Policy Review masthead. However, ASC president John Fisher, who addressed the WACL meeting, did not drop Pearson from the American Foreign Policy Institute board.”
In 1967, an Austrian economist and founding member of the Mont Pelerin Society, Ludwig von Mises, joined the editorial board of the Bircher Publication American Opinion, writing articles for it such as “On the International Monetary Problem.” Mises was a card carrying Austrian fascist who had worked as an advisor for dictator Englebert Dolfuss and is on the record claiming that, fascism, “has, for the moment, saved European civilization. The merit that Fascism has thereby won for itself will live on eternally in history.”
Around this same time, Larry McDonald, a former flight surgeon for the US Navy, joined the John Birch Society. According to his first wife, McDonald would host thousands of people at his home to disseminate Bircher agitprop. After becoming a House rep for Georgia’s 7th congressional district in 1975, McDonald hired former staffers of the House Committee on Un-American Activities to work in his own congressional office to continue their research on left-wing groups, which was shared with law enforcement. Unsurprisingly, after McDonald co-founded the Western Goals Foundation in 1979 with John Herbert Rees, a government informant associated with American Opinion Speaking Bureau, a Bircher offshoot, and Major John K. Singlaub, a founding member of the CIA, a former officer in the OSS, and a major in the United States Army, Roy Cohn joined its advisory board.
Conclusion of Part One
We can see, starting before the end of World War 2 and developing throughout the first stage of the Cold War, the rise of a most putrid coalition within the American bourgeoisie. Like the rest of its class, this gang of capitalists, criminals, and cops wanted nothing less than the total annihilation of communism and anything aiding its development. However, they wished for a quicker, more efficient, and less diplomatic destruction of this enemy than their counterparts in the world of New Deal liberalism. For them, communism could not simply be “contained” but had to be purged from the Earth, like a virus. This reflects the extension of settler-colonial obsession with “purity”, itself a descendant of the Crusades, into the age of imperialism.
One member of this complex even framed it specifically as an extension of the Crusades. In a memo dubbed “Ideological Warfare”, CIA man WR Kinter proclaimed that communism was a “20th Century Islam” seeking to destroy the “foundations of Western civilization.” This jibes with the sentiment of the intellectuals who became the first neoliberals. The original manifesto of the Mont Pelerin society read:
“The central values of civilization are in danger. Over large stretches of the earth’s surface the essential conditions of human dignity and freedom have already disappeared. In others they are under constant menace from the development of current tendencies of policy. The position of the individual and the voluntary group are progressively undermined by extensions of arbitrary power. Even that most precious possession of Western Man, freedom of thought and expression, is threatened by the spread of creeds which, claiming the privilege of tolerance when in the position of a minority, seek only to establish a position of power in which they can suppress and obliterate all views but their own.
The group holds that these developments have been fostered by the growth of a view of history which denies all absolute moral standards and by the growth of theories which question the desirability of the rule of law. It holds further that they have been fostered by a decline of belief in private property and the competitive market; for without the diffused power and initiative associated with these institutions it is difficult to imagine a society in which freedom may be effectively preserved.”
As Jessica Whyte points out, “It was not that, for the neoliberals, market competition was simply a more efficient means to distribute goods and services. Instead, the market was the central institution that could coordinate society to counter political power.” German neoliberal Willhelm Ropke, who worked closely with the not so de-Nazified West German government after World War 2, demonstrated this with his defense of the traditional family, calling it, “the natural sphere of the woman, the proper environment for raising children and indeed the parent cell of the community.” Thus, as Whyte says, “social conservatism was not an external supplement to neoliberalism. Rather, it was very much part of the neoliberal package from the beginning.” To quote Quinn Slobodian “…the neoliberal project focused on designing institutions—not to liberate markets but to encase them, to inoculate capitalism against the threat of democracy, to create a framework to contain often-irrational human behavior, and to reorder the world after empire as a space of competing states in which borders fulfill a necessary function.”
As Mao once wrote:
“In past history, before they won state power and for some time afterwards, the slave-owning class, the feudal landlord class and the bourgeoisie were vigorous, revolutionary and progressive–they were real tigers. But with the lapse of time, because their opposites – the slave class, the peasant class and the proletariat – grew in strength step by step, struggled against them more and more fiercely, these ruling classes changed step by step into the reverse, changed into reactionaries, changed into backward people, changed into paper tigers. Moreover, eventually they were overthrown, or will be overthrown, by the people. The reactionary, backward, decaying classes retained this dual nature even in their last life-and-death struggles against the people.”