Joseph E. Persico (19 page)

Chapter VIII

Donovan Enters the Game

BILL DONOVAN, the man who would see an acorn and envision an oak, took his meager mandate as coordinator of information and quickly began to build the kind of espionage service inspired by his British mentors. His charter, in the numbing prose of federal bureaucrats, to “collect and analyze all information and data which may bear upon national security . . . and to make the same available to the President . . . and other Federal agencies,” made the COI sound like a paper-shuffling mill. But a subsequent FDR instruction gave Donovan pliable authority that he could stretch into an intelligence agency closer to his ambitions. He was “to carry out when requested by the President such supplementary activities as may facilitate the securing of information for national security not now available to the government.” In short, he could spy.

It reflects Donovan's sophistication that he did not turn immediately to shady foreigners, private detectives, or cast-off intelligence operatives from the military, FBI, or State Department to staff his nascent organization. Almost the first person he sought out was Archibald MacLeish, the poet-intellectual librarian of Congress. Despite the public's movie screen image of espionage as shadowy, slouch-hatted figures writing in invisible ink and stealing secret plans, Donovan recognized that 95 percent of intelligence involved conventional research. MacLeish's library offered a mother lode of information to be mined from the world's largest collection of books, manuscripts, periodicals, films, and maps. Donovan's first recruits went to work, at MacLeish's invitation, in an annex of the Library of Congress. Ignoring civil service hiring procedures, Donovan also enlisted an impressive array of scholarly talent: James Phinney Baxter, president of Williams College and a leading authority on Germany; William Langer, Harvard professor of European history; Sherman Kent, Yale professor; Conyers Read of the University of Pennsylvania; James L. McConaughy, president of Wesleyan University and subsequently governor of Connecticut. McGeorge Bundy, later to become President John F. Kennedy's national security advisor and president of the Ford Foundation, wrote, “It is a curious fact of academic history that the first great center of area studies in the United States was not located in any university, but in Washington, during the Second World War. . . .” Donovan had created, Bundy observed, “a remarkable institution, half cops and robbers and half faculty meeting.”

Beyond the academic enlistees, other early recruits suggested the breadth of Donovan's ambitions for the COI. He signed up to head a Field Photographic branch John Ford, the Hollywood director whose credits included
Young Mr. Lincoln, Drums Along the Mohawk, How Green Was My Valley,
and two films for which he won Oscars as best director,
The Informer
and
The Grapes of Wrath.
Gregg Toland, arguably the best cameraman in American filmmaking, with screen credits including
Citizen Kane, Wuthering Heights,
and
The Grapes of Wrath,
also joined the COI film unit.

Later chroniclers who worked with Donovan, Stewart Alsop and Thomas Braden, found him “not a first rate administrator.” Stanley Lovell, a businessman-chemist picked to head the Research and Development branch, was more blunt: “All who knew him and worked under him recognized that Donovan was the worst organizer of all.” Wild Bill drove the professionals in the Bureau of the Budget mad. After only three weeks of COI's existence, detecting early chaos, bureau officials drafted a memorandum asking the President to clarify for them just what this new agency was supposed to do. In the end, the budget chiefs recognized that kindred souls like FDR and Donovan did not bend to organization charts, fixed expenditures, or rules. The bureau initially earmarked $450,000 for a COI payroll of ninety-two employees. Within months the staff had ballooned to 596 people and kept growing. The joke in government circles was that a COI employee who missed a day was likely to return to find two new employees sitting at his desk. Most repellent to budget officials, who worshipped financial accountability, Donovan had, in effect, managed to receive a blank check from the President. Most of his funds were to be “unvouchered”; they could be spent secretly for whatever purpose Donovan deemed in the national interest.

His staff first occupied a run-down apartment house at Twenty-third and E Streets, N.W. Washington, but soon spread like lava to engulf a complex of redbrick buildings originally belonging to the National Institutes of Health, then flowed over bleak temporary frame buildings in back of a brewery, all collected under the mailing address 2430 E Street, N.W. Donovan, who understood the power of first impressions, commissioned the noted architect Eero Saarinen to design, for visiting VIPs, the most impressive briefing room in Washington. It was equipped with air conditioning against the tropical Washington weather, sliding wall panels for map displays, fluted wooden room dividers, a revolving globe five feet in diameter, and a theater. Colonel Edwin L. Sibert, an Army intelligence officer, visited Donovan's burgeoning empire and said it “closely resembled a cat house in Laredo on a Saturday night, with rivalries, jealousies, mad schemes, and everyone trying to get the ear of the director. But I felt that a professional organization was in the making. . . .”

Bill Donovan, perhaps a managerial calamity, was, more importantly, a natural leader, a master of theater, a man who floated above the mundane, much like the President he served. He managed to have Marine Captain Jimmy Roosevelt assigned as his liaison between COI and all federal agencies. When young Roosevelt called, Donovan knew, his calls would be taken. As
Life
magazine put it, “[T]o get Jimmy Roosevelt into your show is as good as a seat at the White House breakfast table.” Donovan also hired Estelle Frankfurter, sister of Felix Frankfurter, the Supreme Court justice and FDR confidant. Donovan intuitively understood the strategies of success, even if he could not concentrate on an organization chart if someone held a gun to his head. The man's brain was fertile, not orderly.

In August 1941, Donovan had a visitor, Wallace Banta Phillips, whom Vincent Astor had tried unsuccessfully four months before to have FDR dump. Phillips was running a string of agents abroad for ONI, the “K Organization,” operating in twelve countries, he told Wild Bill. Though technically under the Navy, the K Organization reported to a committee representing State, War, Navy, and the FBI. This hydra-headed arrangement was not working, Phillips said, and he wanted Donovan to take it over. Instead of trying to crush a potential rival, as Astor had done, Donovan looked closely into the mouth of this gift horse and saw opportunity. He pressured the Bureau of the Budget to come up with $2.5 million for him to absorb the K Organization, thus buying himself an existing espionage unit for COI.

Phillips's uncontested divorce from ONI and remarriage to the COI was symptomatic of a discomfort that the Army and Navy intelligence branches felt toward spying. An Army attaché spotting the latest tank model at a military parade or a naval attaché learning of a potential adversary's battleship strength while watching foreign fleet maneuvers was their concept of espionage. Still, the services saw an opportune solution to their need for better intelligence, despite their reluctance to collect it. Let Bill Donovan and his new COI do the shady stuff. Donovan saw the opening and scooted through it like the college quarterback he had been. By October 11, he could inform FDR, “By joint action of the Military and Naval Intelligence Services there was consolidated under the Coordinator of Information the undercover intelligence of the two services.” His organization had been handed this assignment, he said, because “A civilian agency has distinct advantages over any military or naval agency.” He moved quickly to send COI personnel abroad. Their function was to recruit secret agents and conduct espionage even after “diplomatic relations are severed.” He was further preparing to conduct clandestine communications “both by radio and other means that will endure after the particular country has been closed to us diplomatically.” Roosevelt could admire the man's bold maneuvering, as long as he himself still held the leash, which was not always visible to the person at the other end.

Just two days later, on October 13, FDR seemed to put his stamp of approval on Donovan's swelling authority. Adolf Berle informed the President that something was bothering the FBI, and he too was concerned. The bureau operated a shortwave station between the United States and England, and British intelligence in America had been permitted to use this link to transmit hundreds of messages to London, all in code. The FBI had not the foggiest idea of what was being sent over its own circuit, and was uncomfortable with the arrangement. FDR sent a memorandum giving Donovan responsibility to unsnarl the problem: “This seems to be a matter which you ought to look into, will you handle it with Berle, FBI and the British intelligence?”

Donovan's standing also received a backhanded boost from an unexpected source. Later that month, the COI director brought to the White House a cable from the American embassy in Berlin that seemed certain to interest FDR. The embassy had forwarded press accounts from the Nazi Party newspapers, the
Angriff
and the
Völkischer Beobachter,
reporting Donovan's appointment. The latter paper's headline read,
THE JEW-ROOSEVELT NAMES WAR MAKER DONOVAN AS SUPER-AGITATOR.
The purpose of Donovan's COI, both papers reported, was “making the American people ripe for war.” These stories, the embassy noted, marked an advance in Nazi vituperation: “. . . [S]ince the appearances of articles in several German newspapers some months ago on the alleged Jewish ancestry of the President, this is the first time he has been referred to as a Jew in German newspaper headlines.” A subsequent story in the Nazi press reported, “Roosevelt has named the Colonel Coordinator of Information. Hiding behind this title he is brewing a Jewish-Democratic crisis which is directed at all of Europe. Colonel Donovan's office . . . has grown into the largest espionage and sabotage bureau that has so far been seen in any Anglo-Saxon country.” This Nazi ranting delighted both Donovan and the President who had appointed him.

Not everyone saw the COI as a welcome answer to the gap in America's intelligence defenses. Senator Burton K. Wheeler of Montana, a New Deal friend but isolationist foe of FDR's, complained one month after the creation of the agency, “Mr. Donovan is now head of the Gestapo in the United States. That is the proper place for him, because he knows how such things should be done. . . .” Wheeler then ticked off a list of senators whose offices had supposedly been raided by Donovan when he was with the Justice Department in the twenties. “So he is a fitting man to head the Gestapo of the United States,” the senator concluded.

Donovan, however, would have to contend with rivals with far sharper fangs than the gaseous Wheeler. The COI director and J. Edgar Hoover had crossed paths nearly twenty years before when both were on a different footing. Donovan was then assistant attorney general and Hoover, as acting director of the then Bureau of Investigation, was his subordinate. To Donovan, in those days, Hoover seemed a plodding bureaucrat mired in administrative trivia. To Hoover, Donovan was a dilettante who stuck his nose where he had no business and failed to act when he should. Hoover was angered to find his orders inexplicably countermanded or his disciplinary actions reversed. When he took his complaints to Donovan, the assistant AG was always too busy to see him. Later, as Donovan began to understand Hoover's power, he suspected that the FBI director had played a part in President Hoover's failure to appoint him as attorney general. Indeed, J. Edgar Hoover liked to boast: “I stopped him from becoming AG in 1929. . . .”

By the time FDR had appointed Donovan to run the COI, Hoover had a substantial head start in the intelligence field. A full year before, in one of his instant, inexplicable decisions, Roosevelt had ordered that “Edgar” was to have “foreign intelligence work in the Western Hemisphere,” and MID and ONI “should cover the rest of the world.” Given the President's nod, Hoover had moved swiftly. Well before Donovan signed up his first college professor, the FBI already had 150 secret agents, the Special Intelligence Service, working to combat Nazi influence in Latin America. For Hoover, his initial bureaucratic victory was just the first step in an intelligence strategy that suggested, today Latin America, tomorrow the world. Running this worldwide network, Adolf Berle reported to the President, was Hoover's ultimate goal for the FBI.

In his naked ambition, the man had his critics. Secretary of War Stimson wrote in his diary of the FBI chief: “[H]e goes to the White House . . . and poisons the mind of the President.” General Marshall found Hoover puerile and petulant, “more of a spoiled child than a responsible officer.” Still, he had provided useful, if questionable, services to FDR during the 1940 election and continued to do so. Hoover was not only personally helpful to FDR, but was apparently doing a splendid job of spy catching. The FBI still controlled the Abwehr's shortwave station on Long Island and continued to feed bogus intelligence back to Germany over this circuit. The penetration was so complete that even funds sent for the salaries and expenses of the compromised agents were intercepted by the FBI. And then, on July 30, 1941, Hoover practically shut down German espionage in the United States overnight. The FBI arrested thirty-three Nazi agents. William Sebold, the German-born double agent working against the Abwehr and for the bureau, helped finger the suspects, including one seemingly innocuous figure. It was Sebold who tricked the simple Hermann Lang into admitting that he had stolen the plans for the Norden bombsight. These triumphs, which Hoover described over lunches with FDR, could not fail to impress.

In the summer of 1941, the President was approached by the distraught wife of Kermit Roosevelt, his distant cousin and Eleanor's first cousin, the member of The Club who had accompanied Vincent Astor aboard the
Nourmahal
on the 1938 spying expedition to the South Pacific. The heavy-drinking Kermit, already plagued with a venereal disease, had strayed again. He had run off with a masseuse named Herta Peters, their whereabouts unknown. Kermit's wife pleaded with the President to find him and end the scandal. FDR asked Vincent Astor, now coordinating intelligence in the New York City area, to get help from the FBI.