The Patriarch (27 page)

While still furious at Roosevelt for ignoring him, Kennedy discounted the charge that the president had moved too far to the left. His problems with the White House were, for now, more personal than ideological.

“Roosevelt seems to be taking all the criticism smiling and I doubt if he has lost any of his popularity with the people,” Kennedy wrote Harvard Law School professor Felix Frankfurter, who was spending the year at Oxford, on December 5, 1933. “What the future holds in store for us, God only knows. I am keeping shut and sitting on the rails, not even pretending to know anything.”
³¹

We don’t know precisely when or how Kennedy met Frankfurter, but by the summer of 1933, the tall Irish Catholic from East Boston and the small, dapper Austrian Jew from the Lower East Side had become friendly enough for Kennedy to ask advice on Joe Jr.’s education. Kennedy had decided that instead of enrolling at Harvard immediately upon graduating from Choate, Joe Jr. should spend a year abroad. Frankfurter, who never turned down an occasion to offer advice on any subject, recommended that the boy study with Harold Laski at the London School of Economics and Political Science. Kennedy took his suggestion. There was, he believed, no better way to prepare his boy for a world turned upside down by the Depression, then right side up by New Dealers and Frankfurter liberals, than to send him abroad to study with a Socialist who had been a visiting professor at Harvard, was conversant with America and its politics, in regular correspondence with Oliver Wendell Holmes, Walter Lippmann, and Franklin Roosevelt, and entirely supportive of Roosevelt’s “revolution by consent,” which, Laski claimed, was laying “the foundations of a new social order” in the United States.
³²

Joe Jr. enrolled in the General Course at the London School of Economics, where he took classes in French and German as well as history and economics with Laski. Kennedy wrote his eldest son every ten days or so with detailed reports on Choate and Harvard football, news of the family, observations on the Roosevelt administration’s efforts to right the economy, and suggestions as to whom Joe Jr. might look up in London. He never ordered or directed his son to do anything; he simply offered advice, expecting that his son would follow it. When he learned from Jack that Joe Jr., who had been sharing quarters with a Canadian, was now “rooming with an American,” he recommended that he “keep your contacts with the foreigners as much as possible. You have Americans to live with the rest of your life.” When Joe Jr. expressed an interest in racing yachts, Kennedy cabled that he “would much prefer you to study and travel until time to return home. Racing boats in the middle of the year does not appeal to me at all.” Joe Jr. responded that “intention misunderstood. Racing intended for ten days during vacation. . . . Still interested in school work.”
³³

Kennedy had not only decided where and what and with whom his boy would study on graduating from Choate. He also planned his summer vacation. Joe Jr. wanted to crew with writer and radio personality Phil Lord, who was planning a round-the-world cruise on a ship equipped not only with shortwave broadcast equipment, but with a specially designed diving chamber for underwater photography. Kennedy investigated Lord, concluded that his round-the-world trip was badly conceived and ill-funded, and urged his son to make other plans. He suggested that he come back to “the States somewhere around the latter part of July or the first of August to sort of get lined up on your courses next year in Harvard and the Freshman Football Training Camp this year begins rather early in September. Walter Cleary, the Head Coach, called me up the other day to ask if you were coming back. Also, I think it would be nice to spend a month at home at least with the family.” If Joe Jr. wanted to travel, he could do so over his spring break. “The French and Italian situations seem to me to be most interesting and I can arrange for you to meet Mussolini through Breckinridge Long, the American Ambassador to Italy and also arrange an audience with the Pope. I think also that it would be highly educational and instructive to go into Germany and see something of Russia.”
³⁴

That spring, in the used Chrysler convertible his father had bought for him, Joe Jr., with his roommate, visited Rome as his father had suggested, had an audience with the pope, met with Ambassador Long, but not Mussolini, then drove north to Munich, where he would spend the rest of his vacation. A year had passed since Adolf Hitler had been named chancellor, crushed his political opposition, assumed dictatorial powers, outlawed unions and political parties, withdrawn Germany from the League of Nations, and fomented what H. R. Knickerbocker of the
New York Evening Post
described as a “violent campaign of murderous agitation. . . . An indeterminate number of Jews . . . have been killed. Hundreds of Jews have been beaten or tortured. Thousands of Jews have fled. Thousands of Jews have been, or will be, deprived of their livelihood. All of Germany’s 600,000 Jews are in terror.” The violence of March 1933 had been followed by the passage of a series of laws that excluded Jews from working for municipal, state, or national government and limited the number of Jewish students who could attend German universities.
³⁵

No one who read the daily papers and weekly journals, especially the
Manchester Guardian
and the
Nation,
which Joe Jr. subscribed to, could have avoided reading about Nazi persecution of the Jews. Joseph Kennedy, Jr., was, if anything, better informed than most young Americans on what was going on in Germany.

“Before starting on my trip, I had heard the greatest condemnation of Hitler and his party. I had been to Laski’s many times to tea, and heard him and many German Socialists tell of the frequent brutalities in Germany.” Having visited Germany, he was now prepared to discount much that he had heard about Hitler and nazism. Driving north from Italy into Germany, he wrote his father, “I had the opportunity of talking with two different men, one in Pisa. . . . He was quite a learned man, did a lot of business in the States, and was pretty well informed all around. I discussed the usual points with him, and I was very much impressed by the enthusiasm and confidence which he had in the policies of Hitler. He of course agreed that it was regrettable that the Jews had to be driven out, but he said that the methods they employed in business were appalling.”

Arriving in Munich, he was, he wrote his father, immediately “impressed by the quietness of the city. . . . The only signs of a Nazi Germany were the brown shirts, who were very numerous, parading the streets. . . . They are very nice and polite, however, at least to foreigners, and one sees no sign of brutality.” While he had witnessed no overt anti-Semitism, he did not underestimate its presence in Germany but claimed now to understand its genesis and purpose. “The German people were scattered, despondent, and were divorced from hope. Hitler came in. He saw the need of a common enemy. Someone of whom to make the goat. Someone, by whose riddance the Germans would feel they had cast out the cause of their predicament. It was excellent psychology, and it was too bad that it had to be done to the Jews. This dislike of the Jews, however, was well founded. They were at the heads of all big business, in law etc. It is all to their credit for them to get so far, but their methods had been quite unscrupulous. A noted man told Sir James [Calder, the head of the Distillers Company and a family friend] the other day that the [German] lawyers and prominent judges were Jews, and if you had a case against a Jew, you were nearly always sure to lose it. It’s a sad state of affairs when things like that can take place. It is extremely sad, that noted professors, scientists, artists etc. so should have to suffer, but as you can see, it would be practically impossible to throw out only a part of them, from both the practical and psychological point of view. As far as the brutality is concerned, it must have been necessary to use some, to secure the whole hearted support of the people, which was necessary to put through this present program. . . . It was a horrible thing, but in every revolution you have to expect some bloodshed.”

Almost as if following a script prepared for him by Nazi propagandists, Joe Jr. explained to his father that “a great deal of brutality was on private lines,” perpetrated by Hitler’s more rabid followers but never approved by him. Hitler now had “things well under control. The only danger would be if something happened to Hitler, and one of his crazy ministers came into power, which at this time does not seem likely.”

Joe Jr., bizarrely for a practicing Catholic with a retarded sister, hailed as one of Hitler’s great achievements “the sterilization law which I think is a great thing. I don’t know how the Church feels about it, but it will do away with many of the disgusting specimens of men which inhabit this earth.” “The Law for the Prevention of Hereditarily Diseased Offspring,” which Joe Jr. so enthusiastically endorsed, mandated sterilization “by a surgical operation” for those afflicted with hereditary diseases, such as feeblemindedness, schizophrenia, manic-depression insanity, epilepsy, blindness, deafness, serious bodily deformities, and alcoholism.
³⁶

At this point, the most important thing in Joe Jr.’s life—at times, it appeared, the only important thing—was to make his father proud of him. He had written his lengthy essay on Nazi Germany for an audience of one. In it, he had presented his father with observations and analyses that he knew in advance he would agree with.

Kennedy, on receiving his son’s long letter, wrote back at once, on May 4, 1934, that he was “very pleased and gratified at your observations of the German situation. I think they show a very keen sense of perception, and I think your conclusions are very sound. Of course, it is still possible that Hitler went far beyond his necessary requirements in his attitude towards the Jews, the evidence of which may be very well covered up from the observer who goes in there at this time.”

Kennedy was correct, of course, to suggest that Hitler had gone further than was “required” in his “attitude towards the Jews” and that evidence of Nazi persecution might very well have been “covered up” and hidden from foreign visitors. Still, his dispassionate, distanced response to Joe Jr.’s extended apologia for Hitler and his regime suggests that he did not take great issue with his observations, that Nazi persecution of the Jews was not an issue that resonated with him. It was as if his son had written a theme paper on the races at Ascot and his father were grading it: “I think you show a great development in your mind in the last six or seven months. It is most gratifying to both Mother and me.” The only hesitancy Kennedy had in offering more fulsome praise was that his son had not asked what for Kennedy was the most critical question. “What reason [do] you give for his present attitudes towards the Catholics? If he wanted to re-unite Germany, and picked the Jew as the focal point of his attack, and conditions in Germany are now so completely those of his own making, why then is it necessary to turn the front of his attack on the Catholics? When you go in there next time, I think it would be interesting to make some observations on this point.”

On his return to London in late April, Joe Jr. was invited to travel to the Soviet Union with Harold Laski, who was lecturing in Moscow, and Felix Frankfurter, who planned to accompany him. In the end, Frankfurter would decline to go along, in large part because he had been advised not to by Ray Moley, Swope, and others who feared that a trip to the Soviet Union would embolden those who were already charging him with being a Communist. Roosevelt’s move to the left on economic policy had been met by a red-baiting, anti-Semitic whispering campaign that the president had become a captive of left-wing Jews such as Frankfurter. “There is a terrific agitation and feeling against the so-called Frankfurter group in Washington,” Kennedy wrote his son in early May, “and, even the topside Jews of the country are very much worried about the situation in Washington.” Kennedy was outraged by the accusations but nonetheless hoped that Frankfurter would take them seriously and do nothing to aggravate the situation. “I can see his indignation on being advised against [traveling with Laski to the Soviet Union], but he is smart enough to know that we here in America are seeing and hearing a lot of things that he cannot possibly get abroad. So much for politics.”

Since there was no way anyone would ever accuse a Kennedy of being a Communist, no impediment stood in the way of Joe Jr.’s accompanying Laski to Moscow. “It would be wise for you to go with Laski, particularly because it would give you a very favorable view point in consideration of things here, and with rounding out your year there, it strikes me that you would have a great start on any of your contemporaries, and you should be able to keep up very important contacts, so I am very hopeful that you will be able to make the trip.”
³⁷

Kennedy was convinced now that Roosevelt’s move to the left was not going to be reversed, and that being the case, the more his boys knew about state planning, the better off they would be. “The Frankfurter Liberals are still in the saddle,” he had half jokingly written Frankfurter in mid-February, and they were going to remain there. “I hope when the revolution comes, my knowing you will at least get me a sergeantcy, if they have any sergeants now in your prospective Armies.”
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Twelve

T
O
W
ASHINGTON

I
n late February 1934, Richard Whitney, a graduate of Groton and Harvard, former Kidder, Peabody broker, and now president of the New York Stock Exchange, summoned the senior partners of the nation’s largest exchanges to meet with him. He simultaneously contacted “each and every one of the 800 corporation heads whose stock” was listed on the New York Stock Exchange. The securities exchange legislation making its way through Congress, he warned them all, was “a matter of grave concern to every owner of real estate or securities, to all officials of corporations or banks.” No business, banking, or brokerage firm or executive could “afford to disregard this new menace to national recovery.”
¹

The battle of the bankers and Wall Street against the New Deal was now fully engaged. A year earlier, in March 1933, the economic crisis had been so dire, the people so frightened, the Republicans so thoroughly defeated, and business and banking leaders so disgraced that there had been little opposition to the first wave of regulatory legislation. The banking bill had passed in March with almost no debate or opposition, the securities bill in May. Together they provided for a degree of regulation of the banks and of Wall Street that was unprecedented in the nation’s history. Congress had more to do. The Securities Act of 1933 regulated only the marketing of securities. A companion bill that provided for the regulation of the exchanges that traded those securities had been introduced in Congress in early 1934. It was this legislation that had enraged Whitney and led to an outpouring of criticism of a different order from anything that had come before.

Joseph P. Kennedy was nearly alone among those who had prospered on Wall Street
and
supported legislation to regulate it. In February, on his return from Palm Beach to New York, he had written Frankfurter that he had “found that another bombshell had been dropped, in the form of the new stock exchange bill and while I agree with 85% of it (which, by the way, is quite an acknowledgment from an old conservative like myself) I still think that it is unnecessarily severe in the other 15%.” Frankfurter, whose students and protégés had drafted the bill, was delighted with what he took to be Kennedy’s endorsement of the legislation. “When a guy like you agrees with 85% of the Stock Exchange Bill, that’s good enough for me and makes me only wish that fellows with your sense were running the motor and the steel industry, or for that matter, running a lot of other things.”
²

Roosevelt recognized full well that getting the legislation passed would be difficult, but not nearly as difficult as getting it administered. Given the already intense opposition from Wall Street and the business community, he was wary of appointing commissioners with reputations for being anti–Wall Street, antibanking, or antibusiness. The economy was not going to get moving again until big business, the banks, and Wall Street began to invest their capital in job-creating enterprises. They would not do that unless they were assured that the new legislation would not be used as an anti–Wall Street bludgeon. What Roosevelt needed was a strong administrator who was also a conciliator and who could convince Wall Street that the legislation regulating the exchanges was not antibusiness and was not going to impede honest businessmen, brokers, and bankers from making honest profits. Kennedy was the perfect candidate because he was the only one who was both acceptable to Wall Street and trusted by Moley and the Frankfurter liberals who had drafted the legislation.

In late March and early April, while the bill was being pounded by conservative and business opponents in congressional committee hearings, the president went fishing off the Bahamas with his friend Vincent Astor. Returning to Washington by train, Roosevelt, through his son Jimmy, asked if Kennedy would meet with him during a stopover in Palm Beach. The two chatted briefly in the president’s private railcar. Roosevelt invited Kennedy to the White House for the weekend.

The very next day, Kennedy and Rose took the train north to Washington. They spent the afternoon at the racetrack with Jimmy and Betsey and the evening, as part of the president’s party, at the Gridiron dinner at the Willard Hotel. Upon his return to the White House at midnight, Kennedy was summoned by the president to meet with him, Jimmy, and Louis Howe in his private study, where for more than three hours they talked politics, pending legislation, and tax policy.

At 11:15 the following morning, the two men met again, this time by themselves in the president’s bedroom, where the president, suffering from a bad cold, was resting. “He told me,” Kennedy noted in the notes he made afterward, “he thought the time had come when I should come to Washington. I told him I was perfectly happy and willing to come to Washington to be of service to him, but reiterated . . . that my only interest was my personal affection for him, and that I was not interested in taking a position for any other reason. I said I had been rather annoyed at the coolness that had sprung up between us, and for which I blamed Louis Howe. He passingly referred to my connection with Wall Street.” Knowing that his reputation as a Wall Street manipulator was the major obstacle standing in the way of a possible appointment, Kennedy had come prepared with a detailed statement that he now presented to the president, “showing that the bulk of all my money had been made by business acumen rather than Wall Street operation.” Roosevelt didn’t want to look at it. He was not, he made clear, interested in rehashing the past. “He wanted me to forget all that and urged me to come to Washington. He suggested that it might be a very great idea to have me come down as charge of the Securities Commission, which bill was before Congress at that time. He made me no direct offer, and I made him no promise of acceptance.”
³

The president asked Kennedy and Rose to have lunch at the White House before they took the train to New York. To demonstrate the high esteem in which he held the man he had ignored since the election, the only other guests Roosevelt invited to that lunch were Secretary of State Cordell Hull and his wife.

Kennedy felt as if he had been run over by a bulldozer, which he had. In his letter to Joe Jr. in London, he reported that during the course of their conversations, Roosevelt had mentioned several possible government positions in addition to the Securities Commission, including “going to South America as the head of the Commission to regulate tariffs for South America, where he feels the great bulk of the prospects for foreign trade lies. I told him that I did not think [that was] the kind of work I was particularly interested in; in fact, I told him that I did not desire a position with the Government unless it really meant some prestige to my family. I felt my responsibilities with my large family were so great that I would be obliged to remain out of the Government’s activities.” The president was unwilling to take no for an answer. “He said that he thought I had an obligation to do something, and then suggested that I go to Ireland as Minister. He thought it would be a very nice thing for me to go back as Minister to a country from which my grandfather had come as an immigrant. But Mother and I talked it over, and we decided that this wasn’t of any particular interest, and I told him so. Now he has in mind another position in Washington which he hasn’t made clear to me as yet.”
⁴

From Washington, Kennedy traveled north to Bronxville, where he waited for Roosevelt to call and recuperated from a broken leg and smashed right ankle he had suffered while horseback riding. “By a strange coincidence,” he wrote Louis Ruppel, one of the journalists he had befriended on the Roosevelt campaign train, “the horse’s name was ‘Louis,’ named after you I hope, not after the President’s secretary, Mr. Howe. But then, after all, I have been thrown pretty consistently by Louises this year. I will recover, however, and press on to greater efforts. [Eddie] Moore suggests that I ride one of those horses that they put in swimming pools, and when I fall off, I can only get wet.”
⁵

He was able to joke about Howe—who he believed had kept him out of the administration—only because he was convinced that a call to Washington was imminent. Roosevelt recognized the political pitfalls of inviting a former Wall Street plunger to regulate the other plungers, but he was ready to move forward with the appointment. As Harold Ickes, who opposed the nomination, confided to his diary, “The President has great confidence in him because he has made his pile . . . and knows all the tricks of the trade. Apparently he is going on the assumption that Kennedy would now like to make a name for himself for the sake of his family, but I have never known many of these cases to work out as expected.”
⁶

On May 11, 1934, while the securities exchange bill was still being debated in Congress, Tommy Corcoran—the charming, slick, accordion-playing, brilliant, and solitary Irish member of the Frankfurter team who, with stolid, hardworking, and frighteningly intelligent Ben Cohen, had drafted the bill—wrote Felix Frankfurter in London that the “ticket for the Stock Exchange Commission on which the Skipper had secretly smiled [includes] your friend, Joe K. in Boston—Democrat. The last is particularly ‘deep well,’ comes straight from the Skipper through Ray [Moley].”
⁷

If Roosevelt had had any doubts about Kennedy’s competence, they had been dispelled by Raymond Moley, whom he had brought back to Washington to lead the drive for the new legislation. Moley had submitted to the president eight names for the five slots on the commission. First on his list was Kennedy: “the best bet for Chairman because of executive ability, knowledge of habits and customs of business to be regulated and ability to moderate different points of view on Commission.”
⁸

In late June, Jimmy Roosevelt telephoned Kennedy in Hyannis Port to say that the president wanted to meet with him at the White House on Thursday, June 28. Kennedy had by now made up his mind that he would accept the appointment as chair, but would not serve as one of the four other commissioners. Ferdinand Pecora, counsel to the Senate Committee on Banking and Currency, had indicated that he too wanted to chair the SEC, and there had been a groundswell of left New Deal support for him. “I can well remember Joe saying goodbye in the morning on his way to Washington,” Rose recalled later, “and his last words were, ‘I shall probably be back tonight, for I shall not stay unless I get the chairmanship.’”
⁹

As word leaked out that Kennedy was the leading candidate for chairman, public and private opposition mounted, led by Roy Howard of the Scripps Howard newspapers, who visited the president in the White House and then followed up with an editorial in the
Washington News
declaring that Roosevelt’s appointment of Kennedy to the SEC chairmanship would register as “a slap in the face to his most loyal effective supporters.” In the face of such opposition, Kennedy was advised by friends and supporters, including Swope and Moley, to accept an appointment as commissioner if, as now appeared likely, Roosevelt decided he could not name him chairman. Only William Randolph Hearst, to whom Kennedy placed a long-distance call to his castle in Wales, agreed that he deserved the chairmanship and should accept nothing less.
¹⁰

On June 28, Kennedy was driven to the White House for his five o’clock meeting. Roosevelt was at his sadistically charming best. He had decided to offer Kennedy the chairmanship and knew how eager Kennedy was to accept, but instead of getting down to business, he delayed endlessly in speaking his mind. First he invited Kennedy to sit silently in the Oval Office while he made small talk, signed bills, and conferred with various staff members. “At six o’clock, having said nothing to me about the matter he had called me down for, he invited me to have a swim with him in the pool and stay for dinner.” At dinner with Moley, Bernard Baruch, who was staying at the White House, Mrs. Roosevelt, and several others, the president continued to toy with Kennedy. There was more small talk and political gossip, but no mention of the SEC. “At the close of the dinner, Mrs. Roosevelt upon rising, said to the President, ‘Franklin, when are you going to talk to Joe?’ And he said, ‘About two o’clock tomorrow morning.’” The president then rose, leaving Kennedy to chat with Baruch and Moley. Moley was summoned first, and then, about fifteen minutes later, Kennedy and Baruch were asked to join him and Roosevelt upstairs.

Roosevelt played with Kennedy, telling him that he had put him first on the SEC list he had made up two weeks earlier, but not saying whether he had changed his mind since then. “He talked on for about fifteen or twenty minutes without indicating [whether] he intended to make me the Chairman,” Kennedy wrote in his notes of the meeting. “He finally said in a jocular manner, ‘I think you can be a great liberal on that, and I think you would do a great job running it.’” Kennedy asked if the president might want to reconsider, given the opposition to his appointment. “I told him that I had been involved in Wall Street, and, over a business career of twenty-five years, had done plenty of things that people could find fault with.”

“At this point,” Moley would recall in his memoirs, “knowing what was in F.D.R.’s mind as well as if he had put it in writing for me, I said ‘Joe, I know darned well you want this job. But if anything in your career in business could injure the President, this is the time to spill it. Let’s forget the general criticism that you’ve made money on Wall Street.’ Kennedy reacted precisely as I thought he would. With a burst of profanity he defied anyone to question his devotion to the public interest or to point to a single shady act in his whole life. The President did not need to worry about that, he said. What was more, he would give his critics—and here again the profanity flowed freely—an administration of the SEC that would be a credit to the country, the President, himself and his family—clear down to the ninth child.”
¹¹

The initial reaction to Kennedy’s appointment was hostile, as predicted, then grew worse after July 15, when the first chapters of the report of the Senate Committee on Banking and Currency investigations of Wall Street fraud were published and named Kennedy as a participant in the highly questionable, if not fraudulent, Libbey-Owens-Ford stock pool. New Dealers were outraged that their president had chosen a Wall Street denizen to regulate Wall Street. “Had Franklin D. Roosevelt’s dearest enemy accused him of an intention of making so grotesque an appointment as Joseph P. Kennedy,” the
New Republic
editorialized on July 11, 1934, “the charge might have been laid to malice. Yet the President has exceeded the expectations of his most ardent ill wishers.”
¹²