The Path to Power (85 page)

Validated and ratified
—the contracts under which Brown & Root had been working may have been unauthorized; with passage of the bill they would be authorized.

But Johnson needed the help of the young New Dealers at the other end of Pennsylvania Avenue—and he needed it badly.

While the first step toward congressional authorization had been taken, many other steps—approval of the committee report by the full House; approval of a Rivers and Harbors Bill by the Senate; reconciliation
of the two bills by a conference committee—remained before authorization was a fact. And Herman Brown, half a million dollars in debt and with his cash running out, couldn’t wait for them. He needed fresh infusions of cash. Such cash was available under the original appropriation made the previous year—but the Comptroller General’s office and the Bureau of the Budget were delaying approval of new allocations under that appropriation until these steps had been taken. Even more important, while the ex post facto validation and ratification contained in the House bill made Brown & Root’s contracts legal as far as congressional authorization was concerned, it did not solve, but only blurred, the question of the possible deeper illegality posed by the fact that the dam was being built on land not owned by the federal government. Puzzling rumors about the dam were beginning to circulate among bureaucrats, and had reached the ears of one or two Republican congressmen. An investigation would focus attention on the land ownership question, and would make it difficult for the Comptroller General’s office and the Budget Bureau to justify new allocations. The delays had to be ended, and the growing bureaucratic curiosity about the dam dampened—and this could be done only by help from the top.

In obtaining this help, Johnson employed his bluntest weapon. This was Corcoran, the broad-shouldered, bouncy, brash Irishman who in 1937 stood, Joseph Alsop and Turner Catledge wrote, “closer to the throne than any” of the young New Dealers, and who was already a Washington legend for his enthusiasm in using that closeness to bludgeon officials into compliance with his wishes. If a fond President had nicknamed him “Tommy the Cork,” the rest of the capital called him “White House Tommy” because of his predilection for beginning his telephone conversations: “This is Tommy Corcoran, calling from the White House.” And when he called, Alva Johnston wrote, “Cabinet officers, senators, commissioners stand at attention. … Smart people who want to get action at headquarters ignore the regular secretariat, overlook the Cabinet and cultivate the acquaintance of White House Tommy. He can get things done.”

Despite the favorable impression he had made on Roosevelt, Johnson found that it would not secure a freshman Congressman entrée to the White House. So Johnson used Corcoran’s entrée, asking him to raise the subject of the Marshall Ford Dam with the President. Corcoran found the right moment to do so, and Roosevelt’s response was all Johnson could have wished. Corcoran recalls that “Roosevelt said, ‘Give the kid the dam.’”

With Johnson urging him on, Corcoran made the most out of the President’s words, and out of the President’s name. Roosevelt probably was never made aware of the legal problems involved—Corcoran himself may not have been aware of all of them—but, whatever the problems, the President’s order, as implemented by Corcoran, was enough to settle them. The precise nature of Corcoran’s dealings with the previously recalcitrant
Comptroller General’s office and the Bureau of the Budget are not known—Corcoran will not discuss them except to say, “I made a hell of a lot of calls on that dam”—but the refusals by these two offices to authorize additional allocations out of the first appropriation abruptly ended, and the previously growing curiosity about the dam abruptly vanished. The President’s casual word, hammered home by Corcoran, painted approval on the Marshall Ford Dam with a brush so broad that minor points were buried—forever—beneath the paint.

Even with the authorization finally in hand, the second appropriation—the second $5,000,000 (of which Herman Brown would get to keep $2,000,000)—proved difficult to obtain. The money was supposed to come out of work relief funds, the $1,500,000,000 Emergency Work Relief Bill that even then was wending its way through Congress. But Work Relief Administrator Harry Hopkins pointed out that since the Marshall Ford Dam was being built not by a government agency but by a private contractor; since the cost of materials far exceeded that allowed for “non-labor” items; and since the labor involved was highly paid skilled labor, the appropriation would violate at least three fundamental work relief provisions.

These objections were registered in July—less than two months before the initial appropriation would be used up, with Herman Brown still half a million dollars in debt. A letter from Brown’s banker, Thomas H. Davis of the Austin National Bank, told Johnson that Brown was already beginning to close down. “Activity on the Marshall Ford Dam … is practically at a standstill.” On July 20, Brown and Wirtz—accompanied, for window dressing, by the rest of the LCRA board—flew to Washington. Tom Connally was attempting to circumvent Hopkins’ objections by placing an amendment in the Senate version of the Work Relief Bill, but objections arose in the conference committee over a provision so obviously contradictory to the bill’s intent; Connally, despite the power he was beginning to accumulate in the Senate, could find no way around the problem. But White House Tommy could—with an assist from Bill Douglas. Johnson asked Corcoran and Douglas to intercede. The precise nature of their maneuvers are not known, but Jimmy Roosevelt (James H. Rowe, Jr., secretary) began making telephone calls, and Connally was asked to withdraw his amendment—because it was no longer needed. Hopkins quietly withdrew his objections, and on July 22, Johnson, Wirtz and the LCRA directors were invited to the White House. There the President’s son handed them the papers approving the additional $5,000,000 appropriation, making a point of telling them that the President was “happy to do this for your Congressman.” In case they didn’t grasp the point, it was reiterated by Hopkins, when the group was ushered over to his office. “We are doing this,” he said, “for Congressman Johnson.”

The dam—the dam that represented so much to Alvin Wirtz and Herman
Brown—was secured. Alvin Wirtz’s investment in Lyndon Johnson had paid off.

T
OMMY CORCORAN
was Johnson’s bluntest weapon. Abe Fortas, too young to have entrée but gifted with that lawyer’s mind at which other lawyers marveled, was the sharpest. And this weapon, too, was to be called into use.

Herman Brown had his dam now—so he wanted the dam to be bigger.

On November 30, 1937, just four months after Johnson had rescued him from financial disaster by obtaining the vital congressional authorization for a $10,000,000 Marshall Ford Dam, Brown’s construction superintendent, Ross White, speaking at an Austin Rotary Club luncheon in the Driskill Hotel, urged that the dam be made higher, at the cost of an additional $17 million. The next speaker, Howard P. Bunger, who was supervising construction for the Bureau of Reclamation, said that the dam
must
be made higher, for its present height would be “inadequate to control large floods,” and he urged “all interested persons to contact the Congressman representing this district and urge … construction of the high dam.” When the
next
speaker moved that the club’s board of directors prepare a resolution endorsing the dam, it was obvious that Brown, who was sitting quietly in the audience, had orchestrated the meeting. Ray Lee wrote Johnson that evening: “It seems definitely that a carefully staged coup was pulled to get the thing into the public demand stage.”

Johnson’s first reaction, and Wirtz’s, was fury, both political (the statement that the dam was “inadequate” to provide flood control was embarrassingly accurate; Wirtz, of course, had never intended it to provide flood control; despite his statement to the contrary, he had always intended its primary purpose to be the production of hydroelectric power which could be translated into political power) and personal (the two men felt that Brown had taken advantage of them to obtain a bigger profit). Wirtz’s anger was also fueled by fear; the first interest payments on the LCRA’s outstanding bonds were due on January 1, 1939, and the only way to meet the payments was by the sale of power from the LCRA dams; power could not be sold until the dams were completed, and Brown’s proposal would mean that the Marshall Ford Dam, at least, would not be finished in time. Under the terms of the bond indentures, the bondholders could foreclose and take over the project if an interest payment was not met, and the holder of the bonds was the Reconstruction Finance Corporation, whose director, Jesse Jones of Houston, was a longtime enemy of Wirtz who would be only too pleased to snatch his project away from him. Wirtz urged Johnson to see federal officials immediately to make sure that the dam would not be enlarged. (Even before the Rotary meeting, the alliance between the Browns and the two politicians had grown shaky. Wirtz’s plan to use the 2,000 construction
jobs at Marshall Ford as the payroll of a Wirtz-Johnson political organization had been defeated by Brown’s refusal to cooperate; Bunger had received quiet instructions from his superiors at the Bureau of Reclamation not to hire anyone unless they bore a “paper from [Wirtz and Johnson] saying they were approved,” but Brown refused to accept this; “he moved ’em off,” Bunger would recall. “Herman could be rough. On a Herman Brown job, you earned your money.”)

But a dispute with Herman Brown would not be in Johnson’s interest; his ambition dictated the avoidance of a dispute, and, as always, his passions were at ambition’s command. By the time—a week after the Rotary luncheon—that he wrote his first letter on the subject of the high dam (a reply to T. H. Davis of the Austin National Bank, who had written him to “wonder … why the present Dam, now well under way, if it be so inadequate, was ever contracted for”), his anger was banked, the letter diplomatic. Had he already realized that the support of Herman Brown was necessary for the attainment of his great goal?

Seemingly insurmountable problems stood in the way of a high dam, however. The additional $17 million could not come from the LCRA; for not only had the Authority used up all its authorized borrowing power, even if it was authorized to borrow more, it would not be able to pay the interest on new bonds; every cent of possible revenue that could be generated from the sale of power was already pledged to pay the interest on the existing bonds. And how could the money come from the Bureau of Reclamation? The Bureau could build, out of its own funds, only the flood-control part of the dam; any money spent on a dam, or that part of a dam, designed to provide power, had to be reimbursable. And how could the Bureau maintain that the high dam was
not
for the purpose of providing power? It had said the low dam was for flood control—and the low dam was funded. Any additional funds would have to be for power, would have to be reimbursed—and there was no possible source of reimbursement.

The wily Wirtz was working on a solution. Under it, the existing 190-foot-high dam would no longer be a flood-control dam; it would, with a stroke of a pen, be designated a power dam. The flood-control portion of the dam would be the part not yet built—the additional 78 feet—and therefore the Bureau of Reclamation could legally pay for it. But Wirtz’s solution, while ingenious, did not provide a rationale for changing the nature of the 190 feet already built, and it left unsolved another major problem—a result of the fact that the dam was in reality meant primarily for power production. This reality could not be blinked because there was a recognized, accepted, standard formula for determining what portion of a dam was to be allocated to flood control and what portion to power production. By the most generous estimate possible under this formula, no more than $14,850,000 of the cost of the Marshall Ford Dam could be allocated to flood control; the
rest had to be chargeable to power production. But it could not be charged to power production, because the power-production portion was reimbursable, and the LCRA had no further capacity for reimbursement beyond the $9,515,000 it had already agreed to pay. And the two figures—$14,850,000 plus $9,515,000—totaled $24,365,000. The dam would cost at least $27 million, so there was at least a $2,635,000 gap that could not be filled by either of the two agencies connected with its construction. Standing in the path of Herman Brown’s ambition was an intricate legal tangle. Brown could see no way to cut through that knot. Nor could Wirtz or Corcoran. So, Corcoran says, “it [the problem] was turned over to Abe Fortas.”

Johnson telephoned the Browns to report on the situation. As George Brown recalls it, “On his [Fortas’] desk was where the Reclamation thing [had] landed. … He was the key to the whole thing. … If he said it [Wirtz’s scheme] was illegal, it was dead.” Aware of the weaknesses of his case, Brown felt it would be “touch and go,” but Johnson told him that if any lawyer in the world could solve the problem, Fortas could.

And, in fact, Fortas did. He worked out an elaborate rationale for Wirtz’s plan, and he bridged the $2,635,000 gap. Since that money could not be provided by either of the two agencies building the dam, Fortas proposed that it be provided by a third agency: the Public Works Administration. At first glance, legal barriers stood in the way of this solution, too. The PWA was not authorized to build flood-control structures. And it was not authorized to build dams for the production of power, either. But Fortas reasoned—in an elaborately structured memo to PWA Administrator Ickes—that it could build a portion of the dam whose purpose might be defined as neither flood control nor power, because its purpose would be
both
flood control
and
power. This dual purpose would be accomplished by designating 33 feet of the dam—the first 33 feet to go atop the original 190 feet—as a “joint-use pool.” The water entrapped by these 33 feet would be available for power use until the floodgates were opened. But since the floodgates would not customarily be open, that water could be used most of the time for power. The 33 feet of dam—the 33 feet whose cost just happened to be about $2.5 million—would, therefore, be built for power production—but the LCRA would not have to pay for its construction. As LCRA board member Tom Ferguson explains: “The Bureau of Reclamation said it would pay for the top forty-five feet [of the 268-foot dam]. But it couldn’t pay for any more, and the LCRA didn’t have enough money to get up to that top forty-five feet. So the PWA would build the part in between, and the Bureau of Reclamation would build it from where the PWA’s money ran out.”