The Patriarch (34 page)

On October 1, the campaign suffered a major setback when Al Smith, in a nationally broadcast radio address from Carnegie Hall, endorsed Republican candidate Alf Landon, charging, as Hearst and Coughlin had, that the New Deal was rife with Communists. The next morning, Louis Ruppel asked Kennedy to answer Smith’s charges at a meeting of the Chicago Bar Association. Kennedy spoke with campaign officials in Washington, then replied to Ruppel that he could not spare the time to come to Chicago. “Appointments have been made for practically every day and night from now until twenty-ninth of October. I never knew I was so good. Think our interest will be served best by my staying here.”
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Four days later, he gave the first of several nationally broadcast radio speeches. He did not refer directly to Smith’s accusations or the Communist issue. Instead, he repeated his “Roosevelt is good for business” mantra. “Incidentally,” Drew Pearson joked with him a few days after the first talk, “did you know that your radio voice is a double for Groucho Marx? Any time Groucho is late at the broadcasting studio, all they will have to do is to get you to read his lines; no one would know the difference.”
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By early October, the Democrats seemed headed for victory. “The campaign looks to me distinctly Roosevelt, but it will be by no means an easy fight,” Kennedy wrote Ambassador Robert Bingham on October 6, 1936. “Father Coughlin has definitely made bother in the states that we need to carry, and the Communist cry has been raised rather successfully among the Catholics, I believe, to the damage of Roosevelt.”
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As election day approached, Kennedy was everywhere at once, defending the president’s record in newspapers and magazines, on the stump, over the radio. On October 23, from the Waldorf-Astoria in New York City, he introduced the president, who spoke from Washington via nationwide radio hookup to “businessmen’s dinners” across the country.

The following evening, he delivered his own nationally broadcast address from the Copley Plaza in Boston, in which as a homegrown Irish Catholic he answered the charges hurled by Coughlin and Smith that Roosevelt was under the sway of Communist advisers. He reminded his audience that “nearly every piece of social legislation passed by the state to protect the laborer from oppression,” like those passed by the Roosevelt administration, had “been denounced in their day as entering wedges of socialism and communism [by] Back-Bay Brahmins [and] Bourbons in all countries. It was against such attacks that the encyclicals of Poe Leo XIII and Poe Pius XI were aimed.” Roosevelt was not a Communist for advocating social and economic reforms. “Tugwell, Hopkins and Frankfurter aren’t Communists. . . . I know all three of these men very well and I can tell you unhesitatingly . . . they are no more communists than you and I.” Communists, Kennedy declared, were opposed to private property, individual liberties, and religion. But the president and his advisers had time and time again demonstrated an “abiding belief in private property.” As for a commitment to individual liberties, the president, Kennedy joked, had sent “no editors . . . to concentration camps, and my friends in the Harvard Club can call the President anything they care to without fear of reprisal.” Kennedy closed his speech by responding, as only he could, to the charge that Roosevelt was “an enemy of organized religion” by invoking the exalted names of Notre Dame, which had granted Roosevelt an honorary degree, and His Eminence George Cardinal Mundelein of Chicago, who had publicly commended the president. “In the face of this compelling evidence,” he concluded, “certainly no American should be disturbed in the slightest by those who either in the name of politics or through ignorance or fear cry out ‘Roosevelt is a Communist.’”
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In the next week, he gave speeches in Hartford, New York, and then Boston again and spoke on national radio at least twice more. On October 27, he forwarded to Harpo Marx a photograph of the president that he had asked for. “We always deliver, kid. Come on East after Tuesday and help us celebrate.” “Win, lose, or draw,” he wrote James Byrnes, senator from South Carolina and a big Roosevelt supporter, “after Tuesday—Joseph Patrick Kennedy retires from the political ring for ever and a day.”
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The election of Roosevelt to a second term was a foregone conclusion by the time the polls opened on Tuesday, November 3, 1936. But no one had predicted the size of his victory. Roosevelt won forty-six of the forty-eight states, 523 of 531 electoral votes, and 61 percent of the votes. No candidate had ever done better.

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T
here was little time for a victory lap—for the president or for Kennedy. In October, Eugenio Cardinal Pacelli, the Vatican secretary of state, had arrived in the Port of New York. While he insisted otherwise, the reason for the visit was to discuss with the president the possibility of the United States renewing diplomatic relations with the Vatican. Pacelli was accompanied by Enrico Galeazzi, the Rome liaison to the Knights of Columbus and a close friend to Francis Spellman, the highly influential auxiliary bishop of Boston. On Spellman’s suggestion, Galeazzi visited Kennedy at his office at 30 Rockefeller Plaza to work out arrangements for a meeting with the president, which it was agreed would have to wait until after the election.

“The floor of all rooms of his office,” Galeazzi remembered, “was covered with a thick light blue moquette, of the same color as the eyes of this man.” He was impressed by Kennedy’s take-charge attitude, his devotion to the church, and his charm. “Tall, elegant, gentlemanly,” Galeazzi recalled, Kennedy “could be as gentle and kind as a gallant knight or as violent and cross as a general at war.” The two men would become and remain the closest of friends and allies for the rest of their lives.

To be called upon to do a favor for the Vatican was the highest honor Joseph P. Kennedy could receive. He arranged for a private railroad car to transport Pacelli and his entourage between New York and Hyde Park and scheduled a lunch with the president for November 5, two days after the election. There would be no discussion in the press as to what the president and the Vatican secretary of state spoke about. Galeazzi would later recall only that Cardinal Pacelli had visited Hyde Park “in cordial intimacy and stayed for lunch. The aged mother of the President and his son James were present. Joe Kennedy was, with Bishop Spellman, the life of the party.” On his return trip to New York City, Cardinal Pacelli stopped over in Bronxville to visit the Kennedy family. Teddy, who was four at the time, recalled being “fascinated by his long robe and scarlet skullcap, and his long aristocratic nose.” Uninvited, he crawled up on the cardinal’s lap while he was seated on the family’s favorite sofa.
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Two and a half years later, Cardinal Pacelli would be crowned Pope Pius XII in St. Peter’s Square before a gathering of church officials, worshippers, and foreign dignitaries, including Ambassador Joseph P. Kennedy, his wife, and eight of their children. When, in 1946, the Bronxville house was sold, Rose made sure that the sofa the cardinal, now pope, had sat on was moved to Hyannis Port with a plaque made and attached to it to commemorate the 1936 visit.

Fourteen

M
ARITIME
C
OMMISSIONER

W
illiam Randolph Hearst and his media empire were early casualties of the Roosevelt victory.

By relentlessly referring to the president as “Moscow’s candidate” and Stalin’s “comrade,” Hearst had forced his largely urban, working-class, Democratic readers to choose between him and the president. They had chosen the president and stopped buying Hearst papers. Hearst might have survived had he not already been deeply in debt to newsprint suppliers and to the banks. As long as circulation remained stable, his creditors had permitted him to roll over his debt, but with circulation and advertising revenues falling, they refused to do so any longer. Faced with a debt of $2.1 million to the International Paper Company, $300,000 of which was due in early January, Thomas J. White, Hearst’s top lieutenant, contacted Kennedy in New York.

As with RCA and Paramount, Kennedy knew he had been called on not simply because he was an astute businessman and banker, but because he had written the SEC rules that governed the issuance of the new stocks and bonds the Hearst corporations would have to sell to pay off their debts. To protect himself from conflict of interest charges, Kennedy kept his work with Hearst quiet. There were no announcements, no press conferences. He did not request a fee for his services, but asked only that Hearst pay the men who worked with him on the project. He agreed to prepare a restructuring plan, write the registration statements required for the issuance of new stocks or bonds, and then, if warranted, assume some leadership role in the restructured corporation.

On January 20, Kennedy flew north from Palm Beach to Washington, D.C., for Franklin Delano Roosevelt’s second inauguration. This time around, in acknowledgment of all he had done during the campaign, Roosevelt had not only invited him to the inauguration, but encouraged him to bring as many family members as he could gather. Jack and Joe Jr. were occupied with midterm examinations and could not make it, but the other seven children, escorted by a governess and Eddie and Mary Moore, took the train to Washington, were put up at the Brighton Hotel, had dinner at the Mayflower, and were asked to luncheon the next day in the White House ballroom and introduced to the president.

The following month, he heard from the president, who asked if he would accept appointment as the first chairman of the United States Maritime Commission. This was not the type of position Kennedy had hoped for, but he accepted it four days after it had been offered. While no promise was made, the presumption was that if he took on one more impossible task for the president, the next appointment would be more to his liking.

“I am planning to take the same house I had before if possible,” he wrote James Byrnes, with whom he had become quite friendly during his days in Washington. “If by any chance the boys hold you in Session for the summer we’ll at least have some nice cool mint juleps and Boston lobster. If I am confirmed I expect to be in Washington from next Friday on and then I’d like to see you as often as you can find time to see me.”
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Anxious as he was to return to the capital, he did not want to appear too needy a suitor. He made clear to Byrnes and others that he had turned down some “very profitable” assignments to return to government service, because he could not say no to the president. “I should love to tell you the story how I got into this mess, and you and Anna [Roosevelt] would have plenty of laughs,” he wrote John Boettiger, FDR’s son-in-law, who with Kennedy’s help had been appointed publisher of Hearst’s
Seattle Post-Intelligencer
. “I give up my business, give up my leisure to take up the most unworkable bill I ever read in my life, but you know that man’s winning ways. It is pretty good when you can give up a perfectly good reputation and throw it in the ash can when you can be of service, but you know, if you are going through with a guy you must go all the way through. Arthur Krock just telephoned me and he does not think my luck will hold and I probably will be confirmed, although there is still a great doubt.”
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His friends in the press treated his return as if he were Agricola leaving his farm for battle. Krock, who may or may not have remained on the payroll after completing work on
I’m for Roosevelt,
led the cheerleading. In his columns of March 10 and 17, he identified Kennedy “as one of the outstanding figures in American life” and one of the president’s “few ‘miracle-men.’”
Time
magazine went even further by noting in its March 22 issue that after asking others to chair the commission, “the President turned to his most effective and trusted extra-Cabinet friend, red-headed Joe Kennedy. Every night for two weeks a White House limousine met Joe Kennedy as he landed from Manhattan at the Washington Airport, whisked him off to be cajoled by that persuasive pleader, Franklin Roosevelt.”

While the press response to the nomination was near unanimous in its praise, there remained one serious obstacle to confirmation. The legislation that had established the Maritime Commission, though muddled on several particulars, was preemptively clear that only individuals who in the past three years had had no connection to or financial interest in any shipping company could serve as members. Kennedy had held on to the large position in Todd Shipbuilding, Inc., that he had purchased while at Hayden, Stone; he promised that if he was confirmed, he would sell it within sixty days. The solicitor general declared that possession of the stock did not render Kennedy ineligible for appointment. Several congressmen disagreed. To remove any doubts about Kennedy’s eligibility, Senate Majority Leader Joe Robinson of Arkansas introduced a joint resolution certifying that Joseph P. Kennedy “shall not be deemed to be in violation” of the Merchant Marine Act (of 1936). The resolution was passed and signed into law on March 30. Kennedy was confirmed and took office two weeks later.

During the month he awaited confirmation, Kennedy redoubled his efforts to reorganize the Hearst empire. With John Burns, former counsel at the SEC, and accountant Arthur B. Poole, who had worked with him at Pathé, he oversaw the preparation of the registration statements the SEC required for the approval of new bond issues. On March 29, Kennedy sent Hearst a four-page, single-spaced letter outlining his work to date. He recommended that Hearst formulate a long-range plan for the “future management of the financial affairs of your properties” and hire Arthur Poole as a vice president at $20,000 a year to execute it. Much hinged on the development of this plan—including, Kennedy added bluntly, “my own whole-hearted efforts to make important contribution to the financial management of your properties.”
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All through the spring of 1937 and into the summer, before and after he took office as chair of the Maritime Commission, Kennedy worked on the Hearst reorganization. Having submitted and gained approval for the registration statements, he and Poole tried to find an underwriter for the Hearst bond issue. While the bankers they talked to, including Elisha Walker, Harry Stuart of Halsey, Stuart, and top executives at Lehman Brothers and Lazard Freres, indicated interest in joining a consortium, not one of them was ready to take the lead. Ironically, as the
Nation
magazine pointed out on June 19, 1937, in an article titled “Will the SEC Wreck Hearst?” the rules that Kennedy had instituted had compelled the Hearst corporations to disclose information that frightened off potential investors. In the pre-SEC days, Hearst would have been able to float his issue without having to reveal the declining value of his assets, his indebtedness, or the fact that a considerable proportion of the money raised would be going to pay off debts he had personally guaranteed. But those days were gone now, a victim of the “blue sky” regulations that Kennedy had promulgated.

In late June, with the bond issue still without underwriters or subscribers and Hearst in desperate need of cash to stave off bankruptcy, Kennedy, as an act of friendship and because it was a solid investment, offered to buy one or both of Hearst’s Boston newspapers for cash. He also renewed his offer to take over the financial management of the organization. Hearst thanked Kennedy “for the excellent and valuable advice you have given me so freely and so helpfully” and promised that he would give his proposals “the most thoughtful consideration.”
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Kennedy never heard back from him.

In late July, Kennedy came up with another plan to rescue Hearst from his financial difficulties and provide the Kennedy family with a new income stream. He arranged a tentative deal with a Chicago bank, which agreed to lend the Hearst Corporation $2.2 million for ninety days, predicated on Kennedy “taking over the financial management of all the Hearst properties.” The loan would be used to pay off the creditors, after which Kennedy would reorganize the Hearst empire and spin off the magazines into a new company that he would control.
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Hearst’s advisers barely considered the plan before turning it down. Kennedy was disappointed. He had made a good-faith offer, one that would have benefited him and saved Hearst from bankruptcy. “Boy, that offer . . . still looks pretty good doesn’t it,” he wrote Tom White, the only one of Hearst’s lieutenants he trusted, seven months later. “All those secret conversations that our friends had to the effect that this was stealing the magazines from Mr. Hearst sound like a joke. As I look at the picture, I still believe that every bit of advice I gave you and him is the best advice he will ever get. . . . I could cry when I think of his having turned the proposition down.”
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A
s involved as he was with the Hearst reorganization, it was little more than a sideline. He was fully occupied that spring and summer in his new position, as the first chairman of the Maritime Commission. By 1937, it was impossible, even for an isolationist Congress and nation, to ignore the war clouds gathering over Europe. Hitler had quit the League of Nations in 1933, renounced the Treaty of Versailles, rearmed, and in 1936 seized the Rhineland; Italy had invaded Ethiopia; Japan was threatening China; there was civil war in Spain. Should a larger European or world war develop, American trade would be severely impacted, perhaps even cut off as the European-flagged ships that transported the bulk of goods across the Atlantic would be called into service.

To prepare for the worst-case scenarios, it was imperative that the American maritime industry be reorganized and revitalized. American shipbuilding had been in a sorry state for decades now. Most of the merchant vessels engaged in international trade had been built during or immediately after the Great War. It was estimated that within five years, 85 percent of them would be ready for retirement.

For the past eight years, federal aid to the moribund maritime industry had come in the form of lucrative contracts to deliver the mail from Europe. These subsidies had resulted in healthy profits for a few shipowners, but no new ships. In 1936, in an attempt to stimulate domestic shipbuilding, Congress had passed legislation establishing the Maritime Commission and directing it to replace the mail contracts with direct subsidies for new ships. Unfortunately, as Kennedy announced to reporters on arriving in Washington, the new maritime law was “lousy.” The subsidies intended to stimulate shipbuilding had been saddled with onerous conditions, including restrictions on the salaries the shipbuilders could pay their executives (no more than $25,000) and the profit margins they could retain (no more than 10 percent). On taking the job, Kennedy declared that he would undertake his own survey of the industry and offer Congress recommendations on how it might amend and improve the 1936 law.

Though he would complain often—and in doing so call attention to his perseverance and dedication to his job—he was pleased to be back in harness and perversely delighted that he had been handed what everyone considered to be another impossible task. Even Harvard took notice of the distance he had traveled from East Boston and the reputation he had acquired as a Washington problem solver, a man who got things done. Barely a month after his return to Washington and his second “chairmanship,” he received the highest honor his classmates could offer, an invitation to speak at his twenty-fifth reunion. His career at Harvard had been less than stellar—as a student or an athlete—but none of that mattered any longer. “I won’t be like a coy debutante,” he answered Bob Fisher, who had issued the invitation on behalf of the reunion committee, “but will say I’ll be there. It is certain however, I’ll not talk more than fifteen minutes and for the honor and glory of Kennedy . . . Fisher and Company, I’ll do the best I can. Rose is in Boston this week and I told her to contact somebody to talk to seriously as to the arrangements to be made for the children there.”
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Fisher asked Kennedy to get in touch with Robert Benchley, who, with Kennedy, had been a member of Delta Upsilon, and, like him, had become notorious as a Harvard graduate for doing something decidedly un-Harvard-like, writing humor pieces and screenplays for MGM in Hollywood. “There are forty-six mail contracts which have to be settled for the United States government in the amount of $400 million before June 30th,” Kennedy bragged to Benchley, “but they are selling me the idea of coming to the reunion if only for a couple of days. . . . If I have to be there, there is no one I’ll miss more if he isn’t there than you. I could talk with all your bosses and get you a leave of absence if you wanted it. It is a long tough hot trip here . . . but after all you are the great boy of the class and my particular pet. So leave all the beautiful women or bring two on if you want to and try to come, if only for Saturday night dinner. I have to make the address and I want you to introduce me. My past is safe in your hands.”
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Kennedy gave his speech at the reunion weekend’s closing dinner. Instead of rehearsing (as was customary) the ways in which his success in life could be attributed to his four years on campus or telling silly stories and flattened-out jokes about his classmates, he delivered an uncalled-for, unexpected, and unpardonably political speech. Before an audience that was largely anti-Roosevelt and anti–New Deal, he defended not only big government, but Social Security and organized labor. And then, to add provocation to provocation, he praised John L. Lewis, the principal organizer of the Congress of Industrial Organizations (CIO) and perhaps the single most hated man in banks, boardrooms, and Harvard clubs. He had, he told his classmates, recently had lunch with Lewis and come away from the table with “a distinctly favorable impression of the man’s character. . . . On the fundamental issues, that is—his faith in the democratic form of Government and his personal integrity—I entertain not the slightest doubt. We are reaping the whirlwind of a quarter century of mishandling of labor relations. We complain about the lack of responsibility of labor and for years we did our best to render labor organizations impotent.” He closed by emphasizing to his classmates, “particularly to those . . . who have children that the scene is not as bad as it looks. Without wishing to appear in a ‘Pollyanna’ role, I frankly see nothing which justifies the hate and the despair which are all around us.”
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