-Caveat Lector- <A HREF="http://www.ctrl.org/"> </A> -Cui Bono?- an excerpt from: Treason's Peace Howard Watson Armbruster�1947 A Crossroads Press Book Beechurst Press New York 438 pps. -- First/Only Edition -- Out-of Print --[9]-- CHAPTER IX Democrats �Facing Both Ways EARLY IN MARCH 1942 six distinguished-looking gentlemen were seated around a conference table in one of the high-ceilinged rooms of that architectural monstrosity, the Treasury Building. One of those present was contending earnestly that the Americanization of General Aniline & Film Corp. had been assured, first, by the election of Judge Mack as president, and later by the appointment of other well-known Americans as directors. The speaker droned on and on. Finally, he was interrupted by Leo T. Crowley, long time head of the Federal Deposit Insurance Corporation, who said, "See here, Homer, we're all grown up-you know, and everyone else knows that John Mack, splendid citizen that he is, is not the man to head General Aniline." Thus rebuffed, Homer S. Cummings, counsel for General Aniline, cut short his argument for inaction, and the meeting proceeded with its business of approving the new four-man board of directors for General Aniline which the Treasury had agreed upon. Mr. Cummings had good reason to plead for a status quo. The new Treasury-appointed board could not be expected to con tinue his retainer as Washington attorney (rumored to be $100,000 a year) which had been arranged by the old Farben board. In this connection, and as another example of how precisely the Farben pattern repeats, it is interesting to look back to the time when the I. G. Dyes crowd hired John King, former national committeeman from Connecticut to help Attorney General Harry Daugherty give back the German properties that had been seized during World War I. Then, some two decades later, when it again became advisable to take on some additional help in Washington- this time to prevent another seizure of similar properties�Farben's General Aniline hired Homer S. Cummings, who was not only a former national committeeman from Connecticut, but a former chairman of the Democratic National Committee itself, and who had just completed a six-year term as Attorney General -of the United States. While Farben always plays both ends against the middle, politically it strings along with the party in power and so, with the passing of the old "Ohio gang," Farben's American fronts suddenly became Democratic strongholds, at least as far as the nation's capital was concerned. In 1932, James A. Farley, chairman of the Democratic National Committee, had solicited my support for his candidate, and asked me to discuss with Mr. Charles Michelson, publicity director of the Committee, such issues as I thought should be brought into the campaign. The result was what is known as the brush-off. To keep the record straight, I confirmed the meeting in a letter to Mr. Michelson, in which a high point of our disagreement was recorded as follows: When you assert that Eddie Clark, Louis K. Liggett's lobbyist is a 'nice chap,' and that you don't blame Mr. Hoover for securing the support of Drug, Inc., who pay for Clark's lobbying, you are really admitting the very point I allege, i.e., that Hoover's connection with this outfit of patent-medicine fakirs is so clearly defined that Governor Roosevelt could find no more powerful illustration of the hypocrisy of the present occupant of the White House. On the same day I wrote to Mr. Farley, enclosed a copy of my letter to Michelson, and restated the Clark-Drug, Inc. issue: Mr. Hoover's recent performance in taking into the White House as his secretary, Mr. Liggett's lobbyist, is in itself, without trimmings, a major issue. Diplomatically, I had referred to Clark as Liggett's lobbyist rather than Farben's. Mr. Farley acknowledged this letter with assurances of appreciation for my suggestions, and with a nice word of thanks for my cooperation. However, he did not bring the Clark-Drug, Inc. issue into the campaign. After the election of Mr. Roosevelt, the announcement that Senator Thomas Walsh, of Montana, was to be the new Attorney General gave a tremendous boost to the hopes of those of us who had been working for some such strong arm and keen mind to direct the affairs of the justice Department-for someone who would start delving into the whys and wherefores of the inaction against the flagrant violations of our antitrust laws, and other federal statutes, that had stigmatized the three preceding administrations. These hopes expired, however, when Tom Walsh died suddenly in a Pullman sleeper not long before he was scheduled to take over the direction of the Department from W. D. Mitchell. Who can say bow or why the hand of Fate which led Tom Walsh to his untimely end, at a moment of triumph, should also have induced the selection of Homer S. Cummings to occupy the high office thus left open to some deserving Democrat. The official pronouncements during Mr. Cummings' regime as Attorney General are of interest in their relation to the phrase, "the era of non-enforcement of the antitrust laws" coined by Mr. Thurman Arnold. One was a broadcast by the new Attorney General on June 10, 1933, in which he referred feelingly to the Vicar of Wakefield's complaint that "the laws govern the poor and the rich governs the law," and then announced that a vigorous campaign against racketeers was to be started. It was a beautiful address. Everybody is against racketeers. The other announcement came from Mr. John Dickinson when that gentleman was appointed by Mr. Cummings to take charge of antitrust law enforcement. Mr. Dickinson stated that those laws would be enforced to the hilt only when someone was getting hurt, and explained that the Antitrust Division was not a "detective agency." So far as Farben was concerned, no detective agency was needed to reveal the illegality of their contracts; but this was in 1935, no one was being hurt�then. Later, millions were to die. My own relations with Mr. Cummings began at arms length in 1933, when be became Attorney General, and later developed to sword's point. Finally, in a letter not intended for my eyes, the Attorney General warned a member of the Senate that it was considered "dangerous to correspond with Ambruster." Indicating an official state of mind which perhaps Mr. Cummings may share with other figures in the story of I. G. Farben. The real gem of Homer Cummings' official writings, was the naive allegation which appeared in his 1937 Annual Report to Congress, of his administration as Attorney General, that: "The antitrust laws . . . . . have saved us from any cartel system." Perhaps, though, we are going too fast with the Democratic part of the story. Away back in September 1918, when Francis Garvan house-cleaned the American Bayer Company, he installed a new set of officers to take the places of those he had jailed or put in internment camps. Unquestionably Mr. Garvan's intentions were just what he stated them to be�to create an all-American concern by putting native-born Americans in charge of the company; Americans, who so far as was known, had no connections with the former German owners. As stated in Chapter III, among these new Bayer executives, was a young Democratic attorney named Earl I. McClintock. He had been just added to the staff of the Alien Property Custodian to become secretary of the seized Bayer Company, and retained that position all through the sale of the company and the transfer of its title to Sterling Products, Inc. When the latter took title, McClintock went along with the plant and goodwill of the business. He tossed aside his salary of $3,000 a year and opportunities for advancement in Government service for $13,000 a year as an executive for the new owners. This modest sum was, of course, to increase as McClintock rose to become the right-hand man of Doctor William E. Weiss in those deals which were to return the "Americanized" Bayer to the not too remote control of its former German owners. As an executive of Sterling, Mr. McClintock climbed steadily while the Republicans held sway at Washington. Politically, however, he remained in a state of suspended animation until after that fateful period when the sun of Herbert Hoover slid over the horizon, leaving neither chickens nor pots; only a sheriffs notice on the empty garage. When the Democrats got back in the saddle, however, Mr. McClintock began to go to town, and it was not long before he was reputed to have become a figure of importance among the group that had put the New Deal into power. One of the claims to fame, boasted of by Mr. McClintock's friends, was his membership in, and some said his chairmanship of, the Finance Committee of the Democratic National Committee. Later, in 1941, after various official investigations had started some of the Government's keen young bloodhounds on the trail of the illegal Sterling-Farben tie-up, I heard more about Mr. McClintock's association with the Democratic National Committee. Usually the comment was highly critical, as the relationship was regarded as a definite obstacle to further investigation. So, on November 22, 1941, I wrote to Senator Guy M. Gillette, Chairman of the Senate Committee to Investigate Campaign expenditures, asking for: A searching investigation to determine the size and number of contributions which have been made, directly and indirectly, to the Republican and Democratic National Committees, and to the campaign funds of individual candidates for the Senate and House of Representatives. during the last ten years, by the German I.G. Farben and its American corporate allies; especially those included in the Sterling Products, Inc., group of patent-medicine manufacturers ..... Senator Gillette's reply was not encouraging. I was a bit too late; the committee had. been appointed for the 1940 campaign only, and had been dissolved, "So it has no authority or existence at the present time." It appeared that there is an open and a closed season for investigating campaign funds. So, I put that correspondence in my .await events" file. Then, nearly a year later, on September 12, 1942, I tried again. This time I wrote to the Hon. Ernest W. McFarland, the new chairman of the Senate Campaign Contributions Committee, suggesting The urgent necessity for an inquiry into past and current contributions by allies, affiliates, and agents of the German I.G. Farben. Such contributions coming directly or indirectly from ..... this vicious German cartel played a tragic part in the past in influencing, or controlling, legislative and administrative acts in these United States. There is an abundance of evidence available to prove this. Largely, as a result of not stopping this kind of thing heretofore, we found ourselves in the relatively unarmed condition when the combat war which these people planned for so long finally began. It is unthinkable that repetition should be permitted, or that we should ignore it now that we are paying the price, in blood, for our neglect. If we are to win the war, if our democracy is to survive it has got to be stopped. And the only way to stop it is by a drastic investigation of all who have been, and all who still are, involved in any phase of it ..... Should you request further details, names, dates, amounts, etc., I shall consider it my duty as a citizen to supply them to you. Receiving no reply I called upon the Senator on Oct. 9, 1942, and was received by the energetic young counsel for the committee, James A. Walsh, who appeared to be intrigued by my visit, and undertook to find out the date when Mr. McClintock had retired as chairman, or as a member of the finance committee of the Democratic party. Some time later Mr. Walsh wrote me the result of his inquiry: Following your call at the office, I contacted the Democratic National Committee and was advised that Mr. McClintock is not presently a member of the Finance Committee of that organization. That information not being as complete as it might be, I wrote Mr. Walsh again on Dec. 24, 1942: Many thanks for your letter of the 14th. Can you advise me of the date when Mr. McClintock was first appointed to the Finance Committee of the Democratic National Committee by the Hon. Jas. A. Farley. Also, whether he was asked to resign, or did so without being so requested after his Farben affiliations became more or less public property. I am assuming, of course, that by use of the word "presently" your informant on the National Committee meant to imply that McClintock was just getting out or had just announced his intention so to do. I think that you would be performing a very useful public service if you would check and record . . . . . all contributions which McClintock secured from I.G. Farben and its American affiliates; also his relations with the Hague machine in New Jersey. Such facts are all matters of record, though more or less concealed and disguised, and should be brought out into the sun-light.... You will understand, I hope, that I do not imply for a moment that Farben money went only to the Democrats, or to those who call themselves Democrats. Far from that! I happen to know that the record of those labeled Republicans is every bit as bad, especially when they were in power. One thing I am very sure of; these matters must not be kept under cover now. If the Senate continues to ignore them while lives are being lost, then there is something very rotten indeed. I am sure that you feel the same way about it. Otherwise I would not write you with such brutal frankness. In his response, Mr. Walsh indicated that I was again trying to shoot at campaign contributors out of season, which was positively not permitted by the Senate. As Mr. Walsh put it in a letter dated Jan. 14, 1943: . . . . with reference to possible campaign contributions by I.G. Farben and its American affiliates: I should perhaps explain that the information I obtained concerning Mr. McClintock did not indicate the recency of his separation from the Finance Committee, but was limited to the statement that he is not a member of the Committee. While an inquiry into this phase of campaign contributions in years past might be very revealing and informative, you will remember that the present Campaign Investigation Committee is limited, by the terms of the resolution creating it, to matters occurring in the 1942 campaigns. The season must have been closed early that year, for no further word came from the Senate Campaign Expenditures Committee or its counsel. However, I determined to continue my official inquiries into the mystery of when Mr. McClintock started and stopped being a member of the Democratic Finance Committee. So, I applied to the Democratic National Committee itself, and, diplomatically, merely asked to be advised the names of the members of its finance committee for the years 1936 and 1940. In order to maintain my amateur, or nonpartisan status, I also made the same request to the Republican National Committee. The responses disclosed a deplorable lapse of memory on the part of many well-known personages. Under date of Feb. 13, 1943 I received the following reply from the Democratic National Committee, signed by its distinguislied Chairman: Dear Mr. Ambruster: I sincerely regret that we are unable to comply with your request for a list of the Finance Committee of the Democratic National Committee for the years 1936 and 1940. Our Auditor, who has made a search informs me that no such lists are available. We have recently consolidated our quarters and in making the change the campaign lists of former years were disposed of. You will, probably, find these lists published in the metropolitan press of the years during the campaigns to which you refer. Sincerely yours, Frank C. Walker Not being able to find the information in the metropolitan press, I called at the committee headquarters in the Mayflower Hotel in Washington, and explained to a most gracious young lady that if they could not recall the names of all the members of the finance committee they might at least be able to tell me when Mr. McClintock started and stopped being a member. She assured me that she would ask someone who would know, and that I would then be advised. Apparently no one knew, as no further word was received. I also called at the Republican National Committee headquarters and was told by Mr. Spangler himself that they had their records for at least ten years back, and that he would send me the lists very shortly. Apparently, however, they got lost, too. Meanwhile, not being too easily discouraged, I had written to Mr. James A. Farley at his New York address to see what he might remember. Mr. Farley's reply, dated March 3, 1943, was very discouraging except that it did not deny that Mr. McClintock had been a member of the committee. Dear Mr. Ambruster: I have your letter of March 1st, and am very sorry that I cannot give you the information you desire concerning Earl I. McClintock. For your information, a finance committee is appointed for the duration of a campaign. They exist until the campaign is over and then pass out of existence. We have no records here of the campaign committees for the years 1932 and 1936. I resigned as National Chairman the last of July end Ed. Flynn was not appointed until August 17th of 1940, and, as you know, I had nothing to do with appointing committees for that campaign. The list serves no purpose after election and there is no reason for keeping any records. It would appear that you are out of luck unless you can run across one of the old letterheads showing the names of the committee. Very frankly, I did not know that Mr. McClintock ever served as chairman of the finance committee. I regret my inability to give you the information you desire, but know you will understand that it just isn't possible. Sincerely yours, J. A. Farley I next decided to try the New York Public Library document room but the only thing which bore on the subject was a copy of that celebrated 1936 Democratic Convention Souvenir book from which the party treasury received several hundred thousand dollars for advertising placed by numerous large corporations. Incidentally, most of the advertisers described or pictured their products. One full-page ad, however, was what is known in the program agency business as a complimentary card, and just said, "Sterling Products, Inc." The editors of the book, or Sterling, either did not want the readers to know what Sterling Products was, or else they thought that everybody already knew, and that it was unnecessary to go into details. In this splendidly bound memorial volume of the convention at Philadelphia, there was a handsome photograph of James Aloysius Farley, chairman of the Democratic Party. Under and around the picture was a sketch written by the late J. Fred Essary. In view of my correspondence with Mr. Farley I was intrigued to read Mr. Essary's eulogistic description of him as the man who, "carried in his prodigious memory the names and identity of, thousands of the faithful." This description recalled other things I had heard about Big Jim's card-index memory, so I wrote him again on March 11, 1943, saying: I guess I must have been misled by the many statements which I have heard and seen about the wonderful system of names and deeds kept by Big Jim, and the infallible memory, which gives up instantly. . . . . every name . . . . which has contributed to the Party since he quit box-fights for the big show. As you say, I am just out of luck�unless I can dig up an old letterhead or something. By a quite natural error my secretary addressed this letter to Washington instead of New York. And again a deplorable lapse of memory was recorded�this time by the post office�for someone had stamped the envelope, in big red letters, right over the name of James A. Farley, "No Such. Return to Sender." So, I for-warded the letter to Mr. Farley's correct address in New York with the notation, "What awful memories everybody is getting." Mr. Farley apparently did not see the joke; his reply indicated that he had nothing further to say about Mr. McClintock. (A few months later Mr. Farley was saying plenty about the war, "which," he was quoted as declaring "wasn't our war.") I also tried another prominent Democrat who had been Chairman of the Party's Finance Committee in 1936, Mr. James W. Gerard. No luck there either, save another suggestion to seek the information from the Democratic National Committee. During the period which Mr. Farley now forgets, Mr. McClintock's achievements as a Sterling executive included engaging the services of Mr. David Corcoran as an officer of the Sidney Ross Co., a Sterling subsidiary that distributes patent medicines in Latin America. Mr. David Corcoran was an automobile salesman. He switched to patent medicines in the period when his brother, Mr. Thomas G. Corcoran, as a lawyer on the staff of the Reconstruction Finance Corp., was reputed to telephone Senators and bureau chiefs with, "This is White House, Corcoran speaking." Disregarding for the moment the extent to which Mr. Corcoran, or Tommy the Cork, was ever authorized to speak for the White House, his welcome there was well known. Under the circumstances, the addition of brother David to the payroll of Sterling was recognized as a master stroke on the part of Earl McClintock. As the decade preceding the fateful year 1939 progressed, Mr. McClintock spent more and more time in Washington. His status grew with his recognition as a factor in Democratic Party finances, and gained additional lustre from the new ties formed through brother David with that spoiled darling of the New Deal, Tommy the Cork. Many of McClintock's activities appear in other chapters. He intrudes here merely as a political angel-the Democratic angel whom Farley can't remember. Thomas G. Corcoran originally was employed by the New York law firm of the late Joseph P. Cotton, President Hoover's Under Secretary of State who approved the huge loan made to Germany when the Nazis' rise to power began. He became counsel on the staff of the Reconstruction Finance Corporation in 1932 during the sad, dark days of the close of the Hoover administration. Cor-coran held onto the job when the Democrats came into power and became an important figure among the inside New Dealers. His fame rested upon a versatility which, as the legends grew, was said to include playing a piano with one hand, while writing New Deal legislation with the other. With due allowance for exaggeration the fact remains that Mr. Corcoran was a much more influential figure in Washington than his official responsibilities in the R.F.C. could have caused. He was too light in weight, and too young, to play on the varsity, but be was a big shot on the Washington campus. That he was a young man of great personal charm and nimbleness of mind was conceded by all who came in contact with him. Many of Corcoran's activities had no apparent relation to the R. F. C. This was especially true with regard to lobbying activities for legislation favored by the Administration. In 1935, *in one such legislative battle, Corcoran was accused by Representative (now Senator) Ralph Brewster of Maine with having used improper influence and threats to induce Brewster to change his vote. Mr. Corcoran denied this charge and a Congressional Committee that investigated the row spanked both Corcoran and the Congressman by expressing its disapproval of their actions, then absolved each from any suspicion of improper motives. Mr. Corcoran resigned his government job on Sept. 22, 1940 to direct what was called the Independent Voters Committee for Roosevelt and Wallace. His subsequent occupation in Washington raised a storm of criticism when reports began to circulate that Tommy the Cork was getting sizeable fees for using his New Deal influence to get war defense contracts and other official favors for his" clients. Among the official favors was one that bore directly upon national defense. This was the arrangement whereby the investigation of Sterling's tie-ups with I.G. Farben were concluded with the filing of "informations" and "Consent decrees"�instead of Grand jury indictments which were contemplated by those members of the justice Department who had started the dragnet investigation of Sterling in April, 1941. In the Sterling case rumor had it that the Corcoran fee reached huge proportions. This scandal finally reached such proportions that in Dec. 1941, the Senate Committee to Investigate the National Defense Program (Truman Committee) began an inquiry and public hearings on lobbying. Corcoran appeared as a witness before this Committee on Dec. 16, 1941. "There are five stories," he testified, "which have been whispered about me as a symbol in connection with defense industries." In each of the stories thus defined by Mr. Corcoran, he testified that his services were strictly those of an attorney: in one instance he received no fee; in the others, a total of $100,000. (Which did not by any means represent his total business for the year.) They concerned a shipyard (organized by a gentleman with a past), an engine contract, a magnesium plant, an oil well in Alaska (that was never drilled) and Lend Lease supplies for China. Mr. Corcoran was emphatic in asserting that in none of these cases had he acted as a broker. He added to his denial, "And I don't know what a broker is, either." Senator Brewster, of Maine, then put the following statement, quoted from the public papers of Franklin D. Roosevelt, into the record: I have felt all along that it is not quite in accord with the spirit of the administration that any individual who holds a high party position should earn a livelihood by practicing law, because, in a sense, he holds himself out as having access to the backdoor of the administration. It just "is not done." Finally, Senator Joseph H. Ball of Minnesota, another member of the committee, attempted to question Mr. Corcoran about his relations with Sterling Products and the consent decrees. Mr. Corcoran objected to discussing Sterling. Senator, that isn't a defense matter. I have certain confidential relations with my clients. Very frankly, if this isn't a matter of the kind that the committee generally is looking into, I would prefer not to go into that matter. I have always made it very clear that I was willing to talk about this with the judiciary Committee or anyone else, but my own relationships with my clients are such that I would rather not discuss them in connection with Empire Ordnance, Savannah Shipyards, and a lot of other things, because the public might get the impression that there was defense brokerage in Sterling Products. Unconvinced that the relations between Sterling and Farben did not relate to the national defense program, Senator Ball said: It seems to me that it ties in with this all-out war we are in, and also it certainly ties in with this question we have been discussing quite a bit here, of practicing before Government departments. If we are to believe the newspaper stories, you had quite a bit to do with the appointment of Mr. Biddle (the Attorney General) originally, and then had quite a bit to do with him in developing this consent decree. Far from denying this last statement Mr. Corcoran indulged in a little modest self-praise regarding his part in arranging the Sterling consent decrees: I am being perfectly frank with you, Senator. I have always been perfectly willing to discuss the Sterling case, because, if you don't mind my saying so, I think it was a very farsighted job. And as I told you before, when I last talked to the chairman of the Committee, I bad just come back from the completion of the Sterling reorganization, which I think is one of the most brilliant things-not from my point, but from the point of view of the action of the board of directors themselves�that has been done in the defense effort. The only objection I am making is I don't want the Sterling busi-ness bracketed with an inquiry about defense brokerage . . . I am concerned that the name of Sterling shall not be bracketed in press reports and the rest of it with Charles West and Empire Ordnance and the rest of it ..... The reader should keep in mind Mr. Corcoran's use of the phrase, "far-sighted job," in describing the Sterling Consent Decrees. The chairman of the Committee then ruled that: The committee will proceed with the program as outlined, and when that is finished, we will ask you to come back and discuss this under another heading. There followed some further discussion of Mr. Corcoran's keen desire to not testify about the Sterling case at that particular time. The chairman, Senator Harry S Truman finally recessed the Committee, and thanked the witness with the advice that: "at a future date we will expect you to appear, Mr. Corcoran." However, Mr. Corcoran did not again appear before the Truman Committee to be questioned about the Sterling case or any other matter. The date of the first intercession in behalf of Sterling by Thomas Corcoran is a matter still shrouded in mystery. Requests made to various governmental departments to investigate this have been ignored or rebuffed. Yet he did so intercede even though his name does not appear in the list of attorneys who signed the consent decrees and other court papers for Sterling. That list includes the firm of Rogers, Hoge and Hills, the regular Sterling attorneys; and John T. Cahill, a former associate of Corcoran in the New York law firm of Cotton and Franklin' who, with Corcoran's backing, had been United States Attorney at. New York City from March, 1939, to March, 1941, during the period of the investigation, trial, and acquittal of the only two directors of the McKesson & Robbins swindle who were ever brought even within speaking distance of the bar of justice. At that trial Howard Corcoran, another brother of Thomas, was in charge of the prosecution as assistant to United States Attorney Cahill. The two acquitted directors testified that they had never suspected Coster of wrongdoing. And it might be mentioned here that Howard Corcoran refused the testimony and the proofs which I offered to present to the jury at that trial, that it had long been well known to the drug trade that Coster was a common criminal, and that after the Hoover depression started, McKesson & Robbins was concealing its financial difficulties with fraud. Sterling Products and its chief executives were named on list which I had already supplied those investigating the McKesson & Robbins mess as being among those who had knowledge of Coster's criminal activities. This list also included executives of the trade associations and trade papers which Sterling dominated. Mr. Cahill resumed the practice of law at about the time the justice Department was beginning its dragnet inquiry into the,' Sterling-Farben relations. Robert H. Jackson was Attorney General and in official circles he was regarded as "tough." Certainly he was not soft when he slapped court orders on Farben's huge deposits in the National City Bank, and instructed Thurman Arnold, head of the Antitrust Division, to turn the Farben mess inside out, no matter who was hurt. Then, on June 2,1941, a long-expected vacancy on the Supreme Court occurred with the resignation of Chief Justice Charles Evans Hughes. Attorney General Robert Jackson was nominated to fill the Supreme Court vacancy, and according to Washington reports, one of the most active supporters for his promotion was Mr. Thomas Corcoran. Francis Biddle, then Solicitor General, was named to succeed Mr. Jackson as Acting Attorney General but was not actually nominated until some two months later. Meanwhile, rumors of pressure in connection with the Sterling investigation abounded. In July, Messrs. Corcoran and Cahill held several long conferences at the Department of justice, at which consent decrees were proposed as an alternative to criminal indictment of Sterling and its executives. And, strange as it may seem, the conferences were not held with those members of the antitrust staff who were conducting the investigation. As a result of these discussions there was submitted to the justice Department a paper dated Aug. 15, 1941, and entitled, "The Sterling Representations to the Interdepartmental Committee of the Departments of State, Treasury and Justice." In this document Sterling, over the signature of its chairman, William E. Weiss, graciously promised to cancel its illegal contracts with Farben, and to obey all criminal statutes and war regulations of the United States Government. The crowning gem of the sixteen paragraphs in this promise to "go straight," was the agreement to remove. any director, officer or employee of Sterling or its subsidiaries who was deemed by the Government to be engaged in any activities for the benefit of Axis powers or otherwise engaged in activities contrary to the national interest. This fantastic piece of impudence was the birth of Sterling's alleged repentance, reform and reorganization. It was the document which Mr. Corcoran later acclaimed as, "very far-sighted" and "one of the most brilliant things that has been done in the defense effort." Thurman Arnold's little band of determined investigators, however, did not feel that it was either far-sighted or brilliant insofar as the national security was involved. Some of them refused to abandon their investigation, or to withhold from the grand jury evidence already gathered which involved Sterling's executives in subversive relations with Farben leaders. And resignations, to be accompanied by public statements, were threatened. Just about this time items began to appear in the press that all was not well inside the Department of justice with regard to the Sterling case. The Washington Times Herald published a full-page Sunday feature story about the "young man who practices law out of his hat," which quoted Mr. Corcoran as saying that he wanted to make a million dollars in a year practicing law, and then re-enter official life and spend the rest of his days improving the Government. Referring to the Sterling investigation, the article stated that Tommy's brother David did not want to be bothered by the Department of justice about those who had been holding up the price and keeping down the production of drugs and chemicals essential to the prosecution of the war, and went on to say: Dave Corcoran is an officer of Sidney Ross & Co . . . . . of Sterling Products somehow Sterling Products has got itself tangled up in a Department of Justice investigation . . . . Tommy, with Cahill and brother Dave is defending Sterling's interests. The temperature in the air-conditioned Department of Justice is said to have risen on occasion to something more than blood heat. "Tommy can't get it through his head," reports one observer, "that he is not in the Government any more." Pearson and Allen in their Sunday night broadcast on Aug. 17, 1941, announced that a big explosion was due inside the Department of justice if criminal prosecution was not pressed of American firms for their cooperation with Germany on restraint of trade. "A high departmental official" stated the broadcasters, "is holding back the prosecutions." On Aug. 25, 1941, Mr. Biddle was finally nominated to the office of Attorney General. On Sept. 4, the Senate confirmed the nomination, and the next day the Sterling consent decrees were made a matter of record in the District Court of New York. In just one particular Messrs. Corcoran and Cahill had been compelled to yield ground. Thurman Arnold and his staff insisted that the proceedings must have some relation to the criminal provisions of the law, so an information was filed in the criminal court against Sterling and its three subsidiaries: Bayer, Winthrop and Alba, and two of its officers: Messrs. Weiss and Diebold. All pleaded Nolo contendere, and were fined a total of $26,000. This sum represented an infinitessimal fraction of the illegal profits made by Sterling as result of the unlawful Farben agreements. The subversive activities of the Sterling executives could not be even considered for the good and sufficient reason that they were not mentioned in the information. The consent decrees purported to abrogate the formal agree-ments with Farben, seven of which were recited at length. How-ever, it is doubtful whether Farben will recognize the abrogation of its agreements with Sterling any more than its predecessors recognized the seizure of Bayer during World War I. For one thing these Farben agreements contained clauses requiring Ster-ling to settle any questions relating to them in a German court, for another, it has been admitted by representatives of Sterling that William E. Weiss sent a message to his Farben friends in Germany not to worry about what was going on in the United States because Sterling would find ways of continuing its rela-tions with its Farben associates. It should also be pointed out that the Treasury's freezing of foreign funds and property and the black lists of foreign nationals issued by the Secretary of State already effectually restrained all relations between Sterling and Farben. So the alleged concessions by Sterling, as stipulated in the consent decrees, were an empty gesture by which Sterling gave up nothing that was not already forbidden or impossible. In reality the decrees had just two positive effects, they served to prevent indictment and prosecution of Sterling's executives, and they put a stop to the justice Department investigation of subversive activities by some of the Sterling people that was then in progress. An official statement issued in the name of Attorney General Biddle, at the time the consent decrees were recorded, contained allegations and conclusions which were so at variance with facts known to exist that a wave of caustic criticism arose immediately. Stories appeared in the press about the open rebellion which existed inside the justice Department, due to Corcoran's brazen actions, and also because evidence prepared for submission to the grand jury was being pigeonholed. Mr. Biddle's statement of Sept. 5, it was said, was actually prepared by Corcoran, and read like a Sterling patent-medicine advertisement. On September 25, another official press release was issued about the Sterling case (this time in the name of Thurman Arnold) which also contained statements completely the reverse of facts apparent on the record. Men who knew Mr. Arnold and were familiar with the vigorous language of his privately expressed opinions, were confident that he had not prepared this second apology for the consent decrees, and that it must have been issued over his protest. Among the more absurd allegations in the Arnold press release was the statement that: The illegal contracts (with Farben) were entered into in 1926 long before the Hitler revolution. On the record, the consent decrees listed seven illegal contracts of which three were entered into in 1936, 1937 and 1938, long after Hitler seized power in Germany. Another statement in the release argued that: The Sterling organization must not be destroyed, nor its efficiency hampered, in the present emergency, because of the necessity for American outlets for drugs in this hemisphere. The falsity of this argument was self-evident. The Sterling-Farben branches in Latin America had to be abolished, and the purpose of the decrees was not to preserve the existing Sterling organization, but to destroy those outlets for all time. Whoever prepared that statement for Mr. Arnold's official rubber stamp had small regard for the lustre of Mr. Arnold's name. While this press release was issued in the name of Assistant Attorney General Arnold, copies of it were mailed out over the signature of one James Allen as "Special Executive Assistant to the Attorney General." Mr. Allen, according to press reports, was one of the numerous young men originally brought into the government service by Thomas Corcoran. Mr. Allen turned up later in the. Office of War Information where, in April, 1942, he was one of the higher-ups said to be responsible for the resignation of a group of writers who issued a statement that they were getting out of the O.W.I. because it was impossible to tell the full truth when those in control were turning the O.W.I. into an office of war ballyhoo. Later it was reported that Mr. Allen was again Mr. Biddle's assistant, this time at the Nuremberg trials of Nazi war criminals. One of the most notable aspects of the Corcoran, Trojan-horse trade with the United States Government, was the fact that only two of the executives and directors of Sterling were named in the criminal informations as in any way involved in the unlawful agreements with Farben. Mr. McClintock, chief aide to Mr. Weiss in the Farben relations, was not named, nor was Me. Rogers whose active legal mind worked on the details of some of those illegal agreements and whose signature actually appears on one of them. Others whose names were conspicuously missing in the informations are James Hill, Jr., director and treasurer of Sterling and of Sterling subsidiaries; William E. Weiss, Jr., president of Alba; and Dr. William Hiemenz, Farben's director and plant manager of Winthrop. All of these obviously had something to do with carrying out the contracts with Farben as covered by the information, and the pleas of nolo contendere. Dr. Hiemenz stayed right on as manager of Winthrop until O'Connell's Treasury squad showed him the door several months after the consent decrees had, by negative action, coated him with nice fresh Corcoran whitewash. Another notable who had retained his seat at the Sterling board as one of the consent decree "unmentionables" is one George C. Haigh, whose contact with Sterling goes back to September, 1918, when A. Mitchell Palmer, as Alien Property Custodian, made him a director of the Bayer Co. In. 1919, after Sterling took over and pledged to keep Bayer inviolate from any return of German influence, Mr. Haigh was made a director of Sterling. He continued as a director all through the negotiations of the long string of illegal contracts and agreements which violated in spirit and in letter the pledge and the purpose of the Americanization of Bayer. Others were involved, but the above-mentioned principals are sufficient to indicate the fine legal work done by Mr. Corcoran in consummating his far-sighted and brilliant contribution to our national defense. It may be relevant at this point to cite from the Canons of Professional Ethics of the American Bar Association, with which Mr. Corcoran, no doubt, is familiar. The responsibility for advising questionable 'transactions . . . . for urging questionable defenses, is the lawyer's respon-sibility. He cannot escape it by urging as an excuse that he is only following his clients instructions "When a lawyer dis-covers that some fraud or deception had been practiced, which has unjustly imposed upon the court or a party, he should endeavor to rectify it." The canons of the American Bar Association apply to all branches of the legal profession; specialists in particular branches are not considered as ex-empt from the application of these principles. Many of the American newspapers accepted Mr. Biddle's statement on the consent decrees as conclusive and final, some even commended the outcome. Time, on Sept. 15, exclaimed exultingly: The Justice announcement last week gave Sterling a clean bill of health as far as further Nazi influence is concerned. This, it hoped, might undo some of the damage done by Arnold's previous blasts . . . . . The Sterling deal was Tommy Corcoran's fourth big job since he left the R.F.C. last year. In view of the amount of advertising with which Time and Life have been favored by American affiliates of Farben this rather crude bombast in one of the Henry Luce publications may warrant calling attention to an accusation published by columnist Leonard Lyons in the New York Post that Time had slanted a story in favor of a Luce advertiser, and that its managing editor, T. S. Matthews had confessed that his stories definitely were slanted. The admission made publicly by the Time Editor was that: Facts are the raw material . . . . .common to the whole press, but the products are as different . . . . . as the men who run the papers . . . . a sane journalist cannot be completely im-partial . . . . . the stuff he writes will be definitely slanted . . . . . Leading trade papers also were jubilant. Drug Trade News, companion publication to Drug Topics, which admittedly is subsidized by the drug manufacturers, came out with an editorial rejoicing that "there was no evidence of willful wrong-doing on the part of Sterling and its subsidiaries." Other press comment, however, was decidedly critical. PM, Marshall Field's New York daily paper, had already published several informative articles regarding the Sterling-Farben tie-ups and its comments on the consent decrees and on the Biddle and Arnold press statements were numerous and caustic. The most devastating criticism, however, appeared in a long series of articles by Thomas Lunsford Stokes, Jr., Scripps-Howard feature writer, and probably the most feared of those Washing-ton correspondents who consider it their function to seek out and write the truth, regardless of the high places or the immaculate shirt fronts of the personages involved. Mr. Stokes, winner of the Pulitzer Prize in 1938 for exposing political monkey business in the W.P.A., performed a notable public service in writing a detailed running story of the lobbying activities of Corcoran in connection with the Sterling case. On Sept. 15, Mr. Stokes' comments included: Consent decrees . . . . . have left a sour aftermath in the Antitrust Division of the Justice Department . . . . .The dis-satisfaction attributed to: (1) The pressure and pull exerted by Thomas G. Corcoran, one time New Deal brain truster and now a lawyer-lobbyist who represented Sterling. (2) Failure of the government to take the evidence before a grand jury . . . . .and the terms of the consent decrees, which, in the opinion of some are not as strong as they might be and might become unhinged after the war. (3) The fact that settlement was imposed from the top by Attorney General Biddle . . . .Mr. Corcoran is an old friend of Mr. Biddle. He was influential in bringing Mr. Biddle into the administra-tion and was active on behalf of Mr. Biddle's recent promo-tion from Solicitor General to Attorney General. Mr. Corcoran practically camped in Mr. Biddle's offices ..... was given access to secret information of the department..... and contributed to the writing of the statement for the press which is described by those who know the facts as whitewash, with misleading inferences and actual misstate-ments . . . . .. Investigators were still at work when the settlement was reached and the consent decrees taken into the court They were called from their inquiry, which was turning up some evidence which does not appear in the 'information' . . . . nor in the consent decrees, and is now a closed book . . . . unless it is called for by Congress. On Sept. 17, Mr. Stokes' column contributed the following: A federal grand jury never got to hear the evidence dug up by the Department investigators . . . . It can be stated author-itatively that they were turning up some rather sensational evidence about operations of subsidiary companies of Sterling Products, Inc. in South America, evidence which leaves a question mark as to the efficacy of the consent decrees de-signed to drive the Germans out of that market . . . . Who stopped the investigation? Who stopped submission of the evidence to a Grand jury? >From December, 1939, to April, 1941, Bayer shipped aspirin to I.G. (Farben) agencies in South America . . . . made in the United States but packaged just like the German product. The income of German agents of I.G. Farben in South America was increased during the war by Sterling's payments to them for the distributing of Bayer . . . . . In at least one case, in Colombia, one of these agents, manager of a local company there, heads the Arbeitsfront in the Nazi or-ganization . . . . Dr. E. Wolff, arrested in Panama with a trunk containing various documents, was tried and fined. He was on his way from Berlin to Buenos Aires to work in an I.G. Farben factory. On Sept. 18, Mr. Stokes' column on Sterling and Bayer went back to the days of World War I and expressed the fear that history might repeat-that after this war the Germans might again gain a position of dominance in our chemical and allied industries. This article again castigated Corcoran as a lobbyist for Sterling, and brought Earl 1. McClintock into the picture as one of those who used his official friendships during the negotiations to stop the Sterling investigation from going any further. Another phase of the investigation revealed by Mr. Stokes was the fact that a grand jury, if it had been permitted to examine the evidence assembled in the justice Department, might have acted' upon: The expenditure by Sterling in the last eight years of large sums for advertising in pro-Nazi newspapers in Latin America while only negligible advertising was done in the. antiNazi papers." On Sept. 19, Mr. Stokes discussed Mr. Corcoran's part in the preparation of the Biddle press release saying: This may not be the first time that a private citizen, representing defendants in an antitrust case, has supervised the writing of a government press release but it is the first one that anyone seems to know about; and certainly takes the prize for flagrancy. Soft-spoken Raymond Clapper, Scripps-Howard columnist and colleague of Stokes, used very strong language about Corcoran's lobbying just as he had in 1932 about that other ex-official, Edward. T. Clark. On Oct. 7, he concluded his comments with: What is to be the effect on these junior officials, working on moderate salaries, when they see this cynical kind of funny business going on in the very heart of the New Deal? On November 27,1941, The New York Times discussed "lobby lawyers" in an article which referred to Mr. Corcoran's activities, and quoted Mr. Biddle as stating that he planned no investigation of lobby contracts: Such lobbying, Mr. Biddle said, would be inquired into if the Department of justice was so directed by some proper agency, but not otherwise. According to the Times, when asked if he thought he or other government officers should make public the names of all persons visiting their offices, the. Attorney General replied that he thought it would be very inappropriate to give out such names, and that the public must depend upon the honesty of its officials. (Three years later one of Mr. Biddle's chief assistants was to denounce the handling of this case in damning terms.) I have already mentioned that I had some part in inducing the justice Department to investigate Sterling. Also, I had been supplying the Department with historical and background data which bore upon Farben's activities in the United States, and the conspiracies and subversive activities of those involved with Farben. In some instances, at least, my aid was of value, and on more than one occasion I was officially thanked for my assistance. In any event, I was sufficiently close to what went on both inside and outside the Department, relative to that investigation, to recognize the danger signs as they began to be visible, and to realize that regardless of the integrity and high purpose of those young men of Arnold's, the quarry would not be brought to bay unless the scope and broad purpose of the hunt was enlarged. Accordingly, immediately after the records of Sterling and Winthrop were subpoenaed, I sent Mr. Arnold a number of exhibits which brought out the fact that the Washington lobby had never been identified in the public mind as representing other than American interests. My letter, dated April 15, 1946, stated that: In view particularly of the refusals of the Senate Lobby Committee of 1929 and 1935 to investigate the lobby maintained in Washington by these people . . . . . I do not believe that your own efforts can ever be effective unless this lobby is included in your investigation and action. The present lobby includes some of those mentioned by me as being paid, directly or indirectly, by the German government. That communication was never acknowledged by Mr. Arnold. Perhaps the lobby saw to it that it never reached his eyes; certainly he never mentioned it to me afterward. However, Thurman Arnold cannot say that I did not attempt to warn him of what was going to happen to his Sterling case, and to some of his other Farben investigations, if he did not use, a repeating rifle on the Farben partner's-and a shotgun on the Farben lobby. pps. 155-180 --[cont]-- Aloha, He'Ping, Om, Shalom, Salaam. Em Hotep, Peace Be, All My Relations. 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