10
ANOTHER QUALITY THAT LYNDON JOHNSON had displayed on each stage of his march along the path to power was an utter ruthlessness in destroying obstacles in that path.
The obstacle in his path now was a man named Leland Olds, the chairman (and, in The New Republic’s phrase, “the central force and will”) of the Federal Power Commission, the five-member body that licensed and regulated facilities to create power from natural resources as well as the sale of that power to the public.
The furniture in the chairman’s office on the seventh floor of the FPC Building on Washington’s Pennsylvania Avenue was federal bureaucratic standard issue, but not much else in that office was. On the big desk, near a rack holding several hickory pipes, lay a mathematician’s slide rule, worn with use. In a corner stood a cello, with classical scores open on a stand; Olds was considered one of Washington’s most accomplished amateur cellists. On the bookshelves, alongside the bound volumes of FPC regulations, were stacks of poetry magazines and dog-eared volumes on philosophy and history, one of which Olds might have been reading while coming to work that morning; he took the trolley instead of the bus because it was smoother, and he could read on it. On the coatrack would be a rumpled tweed sport jacket and the old felt fedora he had worn to work, tipped jauntily down over one eye. He would wander in shirtsleeves through the offices of the younger staff members: a brisk slender figure with a shock of graying hair, and lively pale blue eyes behind wire-rimmed spectacles, puffing on a pipe—“jolly, witty, completely informal, not at all aloof or reserved like the other commissioners, ready to talk about anything, like a professor talking with his students,” one staff member recalls. And when Leland Olds got caught up in a subject (as he often did when the talk turned to the morality behind the Commission’s policies or to the social benefits those policies could provide farmers or the poor), he would talk faster and faster, the words tumbling over each other in a very boyish enthusiasm that sometimes made it seem as if the professor-student role had been reversed. He seemed less like a high-level federal bureaucrat than a scholar or a writer or—when he was talking about morality or social justice—like a social worker or a minister. And those four professions had indeed been Leland Olds’ professions until he was forty-one years old.
The son of a mathematics professor at Amherst, George D. Olds, who became the college’s president, and Marion Leland, the daughter of a prominent Boston family, Leland Olds, born December 31, 1890, “liked fun,” a college friend was to recall. Just under six feet tall, thin and wiry, with wavy dark brown hair and those striking blue eyes in a gaunt, high-cheekboned face, he was an ardent outdoorsman, a guide and blazer of trails in New Hampshire’s White Mountains, a tennis player good enough to reach the finals of the Eastern State College Championships, a long-distance runner who once, on a bet, ran and walked the almost forty miles from Amherst to Williamstown and arrived before the kickoff of a football game, and a brilliant student who graduated magna cum laude in mathematics. But perhaps the formative experience of Lee Olds’ college years occurred not on a campus but in a slum—during the two summers he worked at a vacation school that had been established by Grace Church in the nearby industrial city of Holyoke, Massachusetts. There the books by Riis and Dreiser and Norris came to life. In Holyoke, he was to say, “I learned at first hand the impact of the industrialism of that period on the lives of the children of wage earners.” Those summers of watching children work all the daylight hours in sweltering, windowless rooms gave him a determination, as he was to put it, to be “of service,” and after graduating in 1912, “I searched for some pursuit which would have some effect toward mitigating the evil of poverty.”
At first, the search took him into social work—on the staff of a settlement house in the South Boston slums. But a year of seeing the horrors of the sweatshop and hearing the tuberculosis coughs through the thin walls of the railroad flats taught him, he was to say, “a great deal… about the limitations of social work as a means of mitigating poverty.”
Then he turned to organized religion—to the growing Social Gospel movement in which some Protestant clergymen were attempting to secure social justice for the poor by adding a moral element to the reform movement, reminding businessmen, for example, that sweatshops were antithetical to Christian teaching. Olds had been quietly but deeply religious at college—he won Amherst’s Bond Prize for the best talk given at chapel—and his year in South Boston had led him, he was to recall, to believe that the evils of the new industrial order “were not going to be cured by economic and political measures alone, although these must not be neglected, but by what would be in the nature of a religious revolution” in which “people really applied the principles of Christianity to their everyday business.” After studying for two years at New York’s Union Theological Seminary, he was ordained as a Congregationalist minister of a small church in a working-class parish in Brooklyn.
Leland Olds never talked much about the disappointments he suffered in that parish. One of his grandchildren was to write that he came to feel “that the church was not actively enough involved with the problems that faced society at that time,” but Olds himself would say only, “My experience suggested that I might accomplish more through teaching.” He enrolled in graduate school at Columbia University, studying European history, which he later taught at Amherst.
During World War I, however, he was hired as a low-level statistician by the government’s Industrial Relations Commission, and assigned to study the level at which wartime wages should be set. Going beyond the scope of his assignment to satisfy his own curiosity, and displaying a startling gift for analyzing huge masses of raw economic data, the former mathematics honor student concluded that the root cause of the poverty he hated so passionately was the fact that labor was not receiving its fair share of the nation’s increased productivity and wealth, and that labor unions must be given the right to bargain collectively. He realized that he wanted to teach not college students but the labor union activists who were closer to the front lines of the fight for social justice. He became the head of the research bureau of the American Federation of Labor, which was striking against the powerful Pennsylvania steel companies and railroads.
In one Pennsylvania steel town after another, Olds witnessed the brutality with which the strikes were suppressed; he himself was shot in the leg as he was watching police break up a demonstration. For the rest of his life he was to remember his shock at the discovery that the “great railroads were deliberately contracting out their locomotive repair work in order to create unemployment among their own employees.” He was to remember how the children of the railroad workers were hungry. And he was to remember, also, an “inspiring” conversation with a white-haired Roman Catholic priest in Braddock, Pennsylvania, who had allowed striking steelworkers to meet in his church, until mounted police rode their horses into it to break up the meeting.
The Pennsylvania struggle ended in defeat—the companies were simply too strong for the unions, Olds was to say—and he emerged from it convinced that labor’s only hope lay in the intervention of government on its side, that “railroad workers … must look forward either to government ownership of the railroads or to the political influence necessary to secure protective labor legislation,” that if workingmen were ever to earn a living wage, they must be guaranteed the right to organize—and that if government did not secure them that right, the American system of government would perish. “The preservation of the American democratic system required” this “evolution” of democracy, he believed—and to educate labor’s “rank and file” about this necessity, Olds turned from research to writing.
Because “the labor angle on news of strikes, negotiations and so forth was not adequately covered by the general press,” a wire service, the Federated Press—similar to the Associated Press and the United Press, which supplied articles for general-circulation periodicals—had been established in 1918 to provide labor-oriented articles. Most of its eighty subscribers were union newspapers and magazines such as the Locomotive Engineers Journal and the Seattle Union Record, although among its other subscribers was the Communist Daily Worker. The Federated Press had no money to hire an additional staff writer, but Olds’ brilliance as an economic analyst had attracted the attention of liberal and Progressive leaders, and, eager that Olds’ analyses continue, the civil rights activist Roger Baldwin persuaded a liberal foundation, the Garland Fund, to pay part of his $3,600 salary. In 1922 he went to work as Federated’s “industrial editor.”
It was the Twenties—the Twenties of Harding and Coolidge and Hoover, the Twenties of “normalcy” and complacency, the Twenties in which the federal government and courts, high and low, seemed to regard themselves as allies of Big Business, allowing corporations to break strikes and unions, relaxing even token regulations on business, and abandoning social reform. In the Twenties, tariffs and profits and the stock market rose and rose again—and wages, so inadequate to begin with, fell further and further behind, so that workers received a steadily smaller share in the prosperity their toil had helped to create.
In 1919, when reformers’ hopes for a fundamental redistribution of wealth and power—for a new social order—had been high, President Wilson had advocated “a genuine democratization” of industry; a “cooperation and partnership based upon … worker participation in control” of industry; unions and Progressives had more specific—and radical—planks: for nationalization of the railroads, and public operation—“along socialistic lines,” in William Allen White’s phrase—of natural resources like oil, water, and mines. In New York, Governor Alfred E. Smith was proposing not only a minimum wage law and an eight-hour day for women but state ownership of hydroelectric power. The AFL was urging nationalization not alone of railroads but of all key industries. So many liberal dreams had, for a moment, seemed within reach. Now, in the Twenties, labor was asleep again; the union movement, grown cautious and conservative, represented mainly the skilled crafts; the vast majority of America’s overworked, underpaid workers were not members of any union. Dreams had faded. Liberal intellectuals responded by revolting against traditional liberalism, becoming, in their frustration and discouragement, more radical, many believing that a fundamental transformation of American society was required if individualism was to be rescued from its entrapment by a society based on the profit motive. Attracted by the model of the Soviet Union, and feeling that America’s choice was between the ruthlessness of untrammeled private enterprise and a planned, governmental, collectivism, some advocated varied forms of democratic collectivism—perhaps a national economic council representing business and labor as well as government—to preserve what was good in the American tradition.
Leland Olds was a part of this new, radical, liberal current. His gift for economic analysis and his outrage over social injustice fused in the articles he poured out, at least five a week, for the Federated Press between 1922 and 1929. When President Coolidge refused to cut the sugar tariff because of the “hardships” of sugar beet companies, Federated’s industrial editor analyzed the companies’ annual reports and found that their true annual profits were as high as 32 percent. And then, turning to Labor Department studies—studies all but totally ignored by the “general press”—he contrasted the profits with the human cost that had created them. These studies showed mothers and children as young as six working up to fifteen hours a day at dangerous jobs in the sugar beet fields, he wrote in a Federated Press article published on July 1, 1925; at night, families “huddled together in shanties which were not even waterproof, and with practically no decent provision for sanitation.” The Sugar Trust’s “exorbitant profits,” made “at the expense of women and little children … reveal the hypocrisy of President Coolidge in his apology for refusing to cut the sugar tariff.”
He saw the power of big money everywhere—in universities, whose investment portfolios were filled with railroad and oil stocks. (“Needless to say, the dependence of universities on these securities for their incomes influences their view of the economic problem”), and in the church. When a Methodist bishop publicly boasted about his stock market profits, the indignation of the idealist who had once become a minister to help the poor boiled over. The bishop’s financial speculations are “just another proof of the decay of the church as a religious institution and its transformation into a handmaiden of the capitalist system,” he wrote. Religions now preach “the principles of the exploiting class.” Pointing out that while securities given as gifts represented a substantial portion of colleges’ and church portfolios, they represented a very small portion of the wealth of those who made the gifts, he wrote bitterly: “Give till it hurts means nothing to the money princes who govern industry, endow education, and generally distribute royal gifts to the Glory of God and the admiration of the populace. They simply can’t give till it hurts. They have too much.”
And of course, he saw the power of big money in government. When a keynote speaker at the 1928 Republican convention boasted that the United States had achieved a 25 percent rise in gross national product at the same time that labor costs were falling by 10 percent, Olds said, the boast was “hollow … unless he shows what the party has done for the millions of workers laid off in the process. Never was it more clear that the Republican Party is the party of big business, the party which represents the closest alliance between industrial rulership and political administration.”
Not that the Democrats were much better, he wrote; the problem lay in the political system as a whole. The belief that “a political system created in a much simpler economic era still affords the people effective control through their votes over the complex industrial state which has come into being” is a popular delusion. “Politicians must perpetuate this idea, for their jobs depend on it,” but “a true keynote speech would reveal the political government handling certain administrative details for an immensely powerful ruling class.”
Only a complete transformation of the American economic system—“the complete passing of the old order of capitalism” with its laissez-faire government and unfettered economic individualism—would cure the problems, Olds said. The old ideal of democracy had become perverted; the idea of political freedom had resulted in the loss of the economic freedom which alone could really insure political freedom. “Without such a transformation,” he wrote, “to millions of workers … the Fourth of July will loom as anything but the birthday of liberty.”
Such a transformation had already begun in other countries, Olds said, as was shown by the rise of unions in England—and the resultant general strikes there. Changes were coming from both the right and the left, Olds said. He detested Fascism, but even in Fascist Italy, “supposed bulwark of capitalism,” the state—Mussolini—had enacted laws against exorbitant rents and profits, and had begun jailing landlords and shopkeepers who violated them. “Here is certainly a breach which may widen until the sanctity of private property in the capitalist sense follows the divine right of kings into the discard. Inevitable changes in the economic organization of society are exposing it as just another myth….” As for Communism, he had always distrusted it; “in my opinion, the very theory of Russian communism represents a negation of democracy,” he was to say, and his distrust was reinforced by his religious convictions: “I rejected the approach of Karl Marx because I felt that the road to harmony must recognize spiritual values and that ambition for power was an unwholesome influence in human affairs.” Seeing—more clearly than many American liberals in the Twenties—the danger that Communist infiltration posed to American liberalism, and to the American labor movement, when he attempted briefly during this period to help form a new, progressive party in Illinois, he was so concerned “to keep Communists from infiltrating” that he wrote into the party’s “Qualifications for Membership” a statement that “no person who advocates the overthrow of the Government by force or violence or who supports organizations having that end in view will be accepted,” and into its constitution a statement that “The new party must… build on the fundamentally American tradition that all are entitled to the right to life, liberty, and the pursuit of happiness. Importation of theories and influences not germane to American life must be ruled out”—as must “slogans and formulas produced by the struggle in other lands.” Yet along with so many liberals of the time, he saw various innovations in Russia—vacations with pay, still relatively rare in America; improved working conditions for children—as significant social advances. By reducing child labor, he wrote in 1926, Russia “leads the world in its attempt to guarantee every child a chance to flower.”
But whether the transformation of the American system came from the right or the left, Olds wrote, it was coming.
The attempt to run twentieth-century industrial states with governmental machinery designed in the eighteenth century is breaking down. This is the significance of revolutionary events in Russia, Italy and England.
Lenin knew what would take the place of political partyism when he made his bid for power in Russia with the slogan “All power to the Soviets.” Mussolini… saw it when he moved to constitute in Italy under his dictatorship a government composed of the industries rather than regions, with the dominant branch of Parliament composed of representatives of organized labor and capital.
Already in other countries a new age is being born which will succeed capitalist political democracy. The parliamentary systems are decadent.
The changes in America would have to take a different form from those in other countries, Olds wrote, or the particular—and precious—values of the American democratic system would be lost. “Theories developed to meet European conditions fail to include the values the American worker is seeking,” he said. What democracy would evolve into was not yet clear, he wrote. “The new order will be a world order, but not the ideal world order envisioned either in capitalist America, Fascist Italy or Socialist Russia.” A “promise, answering the yearning of people in an American environment,” is needed—and “so far it has been lacking.” But evolve democracy must, he wrote in article after article—or democracy would die.
So vast were the social inequities in the present system that the changes in that system would have to be equally vast, he wrote. Despairing—as many liberals during the decade of outward prosperity under laissez-faire capitalism despaired—that government would ever rein in capitalism, so powerful had it become, he saw no solution in the case of giant industries but nationalization or some other drastic reorganization: since the power of the Coal Trust was effectively preventing the United Mine Workers from bargaining collectively, the miners have only “two alternatives: to develop, along with the rest of organized labor, political power sufficient to put over nationalization, or to seek control by the workers themselves under a worker government.” In the case of the giant utilities, Olds (again in conformance with the prevailing liberal theory of the 1920s; it was not Leland Olds but Governor Franklin Roosevelt of New York who said, “The water power policy of the Democratic Party is socialistic, if you like,” but “I want the government of this State to develop the power sites of this state, because the Government can do it better than anybody else”) advocated nationalization or some more imaginative alternative such as operating utilities “as giant consumer cooperatives.”
DURING HIS WARTIME YEARS in Washington, Olds had met, and later married, Maud Spear. The daughter of a teacher in government schools for Indians, she had been raised on Indian reservations all over the West; then, at Oklahoma A&M, had become one of the first women in the United States to earn an advanced degree in civil engineering, and had been working in Washington with the War Department. During the 1920s, the Oldses had four children. They were quite poor, of course—their only income was his $3,600 salary—and when they moved to Northbrook, Illinois, a little working-class town near Chicago, for the Federated Press job, with his own hands Olds built a house for his family; until he could teach himself wiring, the house had no electricity. The only heat was that provided by a big kitchen stove; hanging blankets in a square around it, to keep its heat concentrated, Maud would gather the children inside the square.
The sacrifices they were making didn’t bother Lee or Maud, but increasingly they felt as if the sacrifices were for nothing. In working-class North-brook, Olds was to say, “I had an opportunity to observe the difficulties faced by many of my friends and neighbors as a result of protracted periods of unemployment which occurred even during the Golden Twenties.” He felt that the solutions he was advocating in his articles could have reduced unemployment, but the solutions were not adopted—nor, he felt, even listened to. His articles changed nothing. The strikes for which he did research and wrote bulletins were defeated. The labor movement in which he had believed so deeply, and to which he had dedicated so much of his life, was, as it grew steadily more conservative and more timid, no longer something he believed in very deeply. His voracious reading had convinced him that, as he was to tell a friend, “Even men supposed to have shaped history were in the hands of something stronger than they were, and that applies equally to Napoleon and the man in the ranks.” He had, he felt, been looking all his life for a cause worth fighting for, and he had not found one.
And then he did.
IN THE SUMMER OF 1929, with the Federated Press unable to continue paying its share of his salary, Olds accepted a lucrative offer with an economic consulting firm, but there was something he wanted to do first. He had come to feel, he was to say, that he was not sufficiently knowledgeable about a significant American business: the electric power industry. One of the country’s great business libraries was Chicago’s John Crerar Library. So, Olds decided, before starting his new job, he would “take a month’s vacation” and spend it in that library, “studying the power and utility situation in all its aspects.”
That “situation” made clear the chasm between America’s dominant belief in Big Business and liberals’ conviction that the business ethos had degraded the nation they cared about. Most of America’s power was hydroelectric, generated by the water of its rivers; in the opinion of liberals, such a natural resource does not belong to any private interest. As the author John Gunther was to ask: “Who and what should own a river, if not the people as a whole?” In the America of the 1920s, however, not only did the people not own this power, they had to pay dearly for the use of it—and to much of America’s people, it was not available at any price.
Most of the nation’s hydroelectric power was controlled by a very few private companies, for the local operating electric companies had been absorbed into holding companies, and then the holding companies had been absorbed into other, larger holding companies, and then absorbed again—until by 1929, when Leland Olds sat reading in the Crerar Library, holding companies had been piled atop operating companies in layer after layer. Since holding companies were interstate, they were largely beyond the reach of state utility commissions, and in the pro-business atmosphere of the Twenties, the agency that had been created to provide federal regulation of interstate hydroelectric development—the Federal Power Commission—was notably unenthusiastic about doing so.
Effectively free of governmental restraint, the holding companies milked the operating companies, selling them materials and management and engineering services at grossly inflated prices, and watered their stocks until stock prices soared far beyond their real worth. These extra costs were passed back to the operating companies—and the operating companies passed them back to the consumers, in the form of rates so high that they deprived low-income urban and small-town families of money for other purposes. And for rural customers the consequences were far worse. Because holding companies saw little profit in rural electrification, which required the building of long power lines into sparsely populated areas, in 1929 more than 6 million of America’s 6.8 million farms did not have electricity. Decades after electric power had become part of urban life, farmers had to perform every farm chore by hand; their wives had to haul up endless buckets of water from wells, and, without the vacuum cleaners, dishwashers, washing machines, and electric irons that had freed city women from much of the drudgery of housework, worked from dawn to dark as if they were peasant women in the Middle Ages.
Insulating private utility companies from government regulation was an impenetrable financial structure. Owen D. Young of General Electric, a brilliant financial innovator in his own right, was to say that when “I begin to examine” the utilities’ complicated structure, “I confess to a feeling of helplessness.”
But Olds’ natural gift for mathematics had been honed by years of analyzing masses of statistical material for the AFL and the Federated Press; at the end of his month’s “vacation” in the Crerar Library, he possessed a rare—in the opinion of men who worked with him later, a unique—understanding of holding companies’ financial complexities and manipulations. This understanding enabled him to determine the true cost to consumers—the rate they should, under state regulation, actually be charged—which meant he was finding formulas under which electric rates could be drastically lowered. Moreover, the refusal of utility companies to provide electrification in rural areas was based on their contention that farmers could not afford to buy electrical appliances; that farmers’ usage of electricity would therefore be low, and rural electric rates that would therefore have to be too high for farmers to afford.
Making detailed analyses of rural areas that had been electrified, Olds proved that this vicious circle could be broken—by lowering rates. In the rare instances in which they had been lowered, he demonstrated, farmers had invariably found that they could afford to use more electricity; they bought more appliances, used still more electricity, and rates could be reduced still further. The principle was not new, of course. Henry Ford had demonstrated it: the cheaper a company prices a needed product, the greater will be the company’s profit. All that was necessary, Leland Olds said, was to apply the principle to rural electrification. And if it was applied, he said, electricity would transform the lives of farm families: a farm wife would no longer have to do her wash by hand, stooping over washtubs, but could simply push a button on an electric washing machine.
Olds’ studies, in other words, had the potential to accomplish what he had decided so long ago he wanted to accomplish with his life: to be “of service”; to “mitigate the evil of poverty”; to “help human beings.” As one of his associates was to explain: “All his life Lee Olds was concerned with the means for decreasing poverty and injustice.” Now, at last, he had found the means. “His preoccupation with obtaining low-cost electricity was only an expression of his belief that low-cost energy would open the door to a more decent world.” And at the end of that month’s vacation, just as he was about to enter private employment, Leland Olds received a telephone call. Looking back at that call years later, he would tell a friend, “I haven’t selected what I would do; things have selected me.”
The telephone call was from Frank P. Walsh, an old Progressive who was now Chairman of the New York State Power Authority, and an admirer of Olds’ articles. Walsh said that New York’s new Governor, Franklin D. Roosevelt, was planning to use the State Power Authority to break the hold of the state’s private utilities and to develop public power for the people. Governor Roosevelt, Walsh said, wanted stricter regulation of utilities, and lower rates, rates based on new formulas. A commission was being established to make recommendations to accomplish these aims, and there was an opening for a staff expert on it. Would Lee be interested in the job?
Lee said he would, and sometime in 1929, he was invited to visit Roosevelt in the Executive Mansion in Albany, and after dinner Roosevelt talked about a farm family in Dutchess County that couldn’t obtain electricity because, as the Governor’s counsel, Samuel Rosenman, was to recall him saying, “the damned old electric corporation says they can’t afford the expense of the line.”
“That farmer’s wife still has to pump her water by hand, and sew by oil lamp, and cook by wood. The farm chores and household chores take so much time that they have no chance for rest and leisure. I want to get cheap electricity out to that farm…. Now, tell me what you think….”
Olds told him. Although he was thirty-nine years old, he was still strikingly thin, and with his hollow cheeks and his eager, intense eyes behind wire-rimmed spectacles, still very much the young radical. And he still, when he became excited, talked too much and too fast. But now—at last—he had found someone who would listen, and who, in fact, spurred him on with more questions (“question and answer, until after midnight,” Rosenman would recall), until the final question: “Tell me, what would you recommend if you were Governor?” As Olds replied, Rosenman, after listening for a minute or two, quietly pulled out a pad and pencil, and began taking notes—as fast as he could write. “Many of the ideas expressed that night found their way into a series of messages which the Governor sent to the Legislature in 1929 and 1930,” Rosenman was to recall. And when, in 1931, Olds’ ideas were codified in legislation expanding the powers of the New York State Power Authority, Roosevelt appointed Olds its executive secretary.
DURING THE TEN YEARS he held that job, Olds proved to be an unusual bureaucrat. To determine the cost, best location, and engineering feasibility of a proposed hydroelectric dam across the St. Lawrence River, he not only commissioned surveys but did some of the surveying himself—living in a tent, camping out on the banks of the broad river, sometimes taking his family along. Back in his office, he worked his big slide rule making pioneering analyses of electric rates. He drafted bills that, over last-ditch Republican resistance in the New York State Legislature, gave the State Public Service Commission new authority over utility rates—and that, in a new tactic to force rates down, authorized municipalities to construct their own plants and distribute power themselves. When New York City Mayor Fiorello La Guardia, angered by rates he considered onerous for the city’s low-income families, proposed building a municipal power plant to establish a yardstick by which the utilities’ rates could be measured, Olds worked with La Guardia’s office on it—and exulted when, as he was to recall, “just one day before the Mayor went before the Board of Estimate for authorization,” a power company official sullenly announced substantial rate reductions. And he exulted a year later, when the same official admitted that after the reduction electric usage had increased so greatly that the company’s profits had risen instead of fallen.
During these ten years, Roosevelt became President (his successor as Governor, Herbert H. Lehman, continued his policies) and the New Deal changed Leland Olds’ views in areas other than electricity. He had believed that there was no alternative to the corporate domination that was destroying the dream of “economic democracy” and social justice in America except the “complete passing of the old order of capitalism,” that in the Industrial Age it had become impossible to reconcile economic and political freedom. Roosevelt taught him that he was wrong: that there were other alternatives—within the existing order. Olds had believed that there was no way of curbing the power of giant corporations and monopolies except by having them taken over, either by the government, by labor unions or by some form of consumer cooperatives. Roosevelt taught him that there was a way: government regulation. Olds had been led to believe by the bitterness of his own experiences that there was no hope that unions would prevail against corporate power; the New Deal taught him that there was hope—that government could enact laws that protected workers’ rights to organize, and to bargain collectively. Olds had believed that under the old order of capitalism, wage earners and their families could never have security against unemployment and old age. Now at least a measure of that security had been given them—and Olds was confident that more would come. He no longer felt it was necessary for the capitalist system to be eliminated; he now felt it could be improved, restored, and preserved. Thanks to Roosevelt, real progress had been made toward the “new age” of which Olds had dreamed; the evolution of democracy which he had long thought impossible was in fact occurring—in the measures of the Hundred Days, and of the hundreds of days which followed during the New Deal. “The great reforms of the 1930s,” Olds was to say, “completely changed the old laissez-faire capitalism into a new model.” And those reforms changed Olds, too. His radicalism was transformed. Like many another passionate radical of the 1920s, Leland Olds became, in the 1930s, a passionate New Dealer—a liberal of the new, vibrant liberal faith.
Olds idolized FDR. Seeing no basic difference between the two parties, he had never been active in Democratic politics, but he became active now—to support the President who was, he said, “the greatest leader democracy has ever produced.” When, in 1937, conservative Democrats in New York’s Rock-land County, where Olds now lived, sought to mobilize opposition to the “dictatorship” of Roosevelt’s Supreme Court-packing proposal, Olds went to a meeting called to support the President, and jumped up in the audience, without preparation but with all his usual eloquence, to deliver an impassioned attack on “the real dictatorship” of “corporate interests” and “reactionaries” which was greeted, the New York Times reported, with “thunderous applause”; “people crowded forward, tipping over benches, to clasp his hand.”
With conservative New York Democrats, including the powerful Tammany Hall organization, rebelling against the New Deal, labor leaders founded the American Labor Party. Olds joined it—because it had been founded to support Roosevelt. Delivering the keynote speech at its 1938 convention, he said the ALP would be the President’s own party; it “invites all who would support the leadership of President Roosevelt, all who recognize the need for party realignment, all who believe that the re-establishment of economic democracy is essential to the preservation of political democracy in our age, to join its ranks …”—and remained active in it for a year, resigning when it became infiltrated by Communists. And in June, 1939, the President brought him to Washington as a member of the Federal Power Commission, of which in January, 1940, he became chairman.
BEFORE OLDS ARRIVED at the FPC, the agency had not been making the progress Roosevelt had hoped toward reducing private control over natural resources—in part because young staff members trying to ascertain utilities’ true financial condition found themselves unable to unravel the tangled web of the giant holding companies’ finances, in part because the commissioners seemed intimidated by the vast new powers they had been given and uncertain how to utilize them. The staff was disorganized; in striking contrast to the situation at most of the New Deal agencies, morale was low.
Olds’ arrival changed that. The staffers who had been daunted by holding companies’ finances found that, as one of them, Melwood W. Van Scoyoc, assistant chief of the FPC’s Bureau of Finances, recalls, “Mr. Olds understood it all so well that he could make it very simple for you.”
Olds provided these young men with not only technical skills but inspiration. The long columns of figures, he made them see, weren’t just figures—they were the key to a better life for tens of thousands—hundreds of thousands, millions—of farmers and their wives and children. He made his assistants understand that if they could get electric rates down, farmers would be able to alleviate the terrible drudgery of their lives. And he made the young men understand that if they could understand the figures, the rateswouldcome down. “He saw (public) power as a means to an end, as an important means of lightening the burden of man,” says Alexander Radin, a young FPC staff member who would later become general manager of the American Public Power Association.
He not only made the young staffers feel they were part of a great cause, he made them feel he was fighting beside them. FPC staff counsel Reuben Goldberg recalls spending “an entire winter” in Butte, Montana, with a handful of FPC attorneys and accountants fighting a big team of high-priced attorneys for the Montana Power Company in a proceeding designed to force down the company’s rates. One day, without any advance notice, there in that Butte courtroom was their boss. He had made the trip from Washington “just to see how we were doing,” Goldberg recalls. “He just stayed a day or two, and had lunch and dinner with us, and was friendly and approachable like always—and let us know it was a very important job we were doing.”
And he inspired them also with his own example. Leland Olds was in his fifties now; the shock of hair had turned gray on the sides. He was a little stooped, and arthritis in his right hand was making it difficult to play tennis or the cello. But while the young men would work late with him in his office, he would eventually send them home; glancing back as they left, they would see him still bent over the masses of figures. Returning to the office the next morning, sometimes they would, Radin recalls, “find him asleep at his desk—he had worked all night.” Some of these young New Dealers were very bright men—bright enough to know how bright Lee Olds was. So broad was Olds’ knowledge of economics, James M. Kiley says, that “His concentration on electric systems was a conscious narrowing of his sweeping, broad interest—like Einstein teaching elementary math to freshmen in college.” They also admired Olds’ sense of justice. “He was very fair-minded,” Goldberg says. “While he was very much consumer oriented, he was also very much aware that you had to be fair to the utilities—that they were entitled to a reasonable return on their investment. Because their financial integrity was necessary to enable them to provide the service to the customers that should be provided. He was constantly reminding us that you don’t help the consumer by destroying the utility. When you hurt the utility, you’re really jeopardizing the consumer.” Under his leadership, the FPC pressured electric utility companies to extend power lines into neglected rural areas, to encourage the increased use of electricity through low rates, and to reduce inflated capitalizations. But the pressure was never draconian. And although he sometimes threatened recalcitrant companies with government takeover—or with the creation of competing consumer cooperatives—behind the threats was a belief that unless the utilities instituted these reforms themselves, the public would demand that government take over their functions. The FPC program, he felt, was actually protecting private enterprise. As Olds told electric power company executives during a 1944 convention, “Many of you have probably heard the work of the Federal Power Commission … attacked as aimed at the destruction of private enterprise and furthering of public ownership. Actually we believe the effect of [federal] enforcement is just the reverse.”
IN THE OTHER PRINCIPAL FIELD of FPC activity—natural gas—Olds insisted on enforcing the Natural Gas Act of 1938, in which Congress had given the FPC broad powers to regulate the price of gas brought by pipeline from Texas and other southwestern states to consumers in the big cities of the North. And he disallowed several accounting devices employed by natural gas companies to hide illegal profits. But his fairness and his belief that only through effective regulation could the private enterprise system be preserved were equally obvious, and he would almost invariably carry the other FPC commissioners with him.
When, in 1944, Roosevelt nominated him for a second five-year term, the articles he had written for the Federated Press during the 1920s were brought up by Senator Edward Moore, a rabidly right-wing Oklahoma oilman, who quoted from them to show that Olds was “Communistic,” as well as a “reformer” and a “zealot” (those last two terms being given equal weight) who was “opposed fundamentally to private enterprise.” Roosevelt had sent up the renomination on May 25, less than a month before Olds’ term expired on June 22, and Moore, a member of the Commerce Committee subcommittee to which the renomination had been referred, delayed hearings until July 6, so that Olds was without a job. But when the hearings were held, the subcommittee’s other members gave Olds an opportunity to explain (“I think my ideas have been going through a constant process of change…. I think it has been my continuous philosophy … that this country has got to work out its solutions in terms of its own traditions; that one of the great things in democracy is that it has the possibility of assimilating change, so that instead of … break-ups you have a constant evolution of the system”) and found his explanations so convincing that they quickly reported his nomination favorably to the full committee, which, after the usual Senate delays, sent it to the Senate floor. When, on September 12, 1944, it was taken up there and Moore repeated his attack, subcommittee chairman James M. Tunnell of Delaware said, “I do not think anyone [in the subcommittee] believed Mr. Olds was a Communist. I do not think the Senator from Oklahoma believed Mr. Olds was a Communist. I do not think anyone believes that.” Declaring that “any statements he [Olds] had made some years before would be rather immaterial, incompetent and irrelevant,” Lister Hill said, “he has a record now of six years of service, and that record” is what he should be judged on, and Tunnell noted that that record “has been reviewed and re-reviewed”—and always approved—by Congress. “The Senator [Moore] must go back approximately twenty years in order to find some ground on which to attack Mr. Olds.” Senators who had been governors—George Aiken and William Langer—and who had worked with Olds in their states rose to praise him, and when Moore demanded a roll-call vote on the renomination, not a single senator was willing to second even that request, and Olds was confirmed for a second term by an overwhelming voice vote of “ayes.” Although the confirmation occurred almost three months after Olds’ term had expired on June 22, the new term for which he was being confirmed had begun on June 22, so his back pay was restored to him.
IN 1944, however, natural gas had still been merely a by-product of the oil industry, a by-product whose price was low because the supply far exceeded demand. During the war, the government laid gigantic pipelines—including the picturesquely named “Big Inch” and “Little Inch”—more than a thousand miles northward to defense plants, and after the war those pipelines were available to link the urban and industrial markets of the Northeast and Midwest to the Southwest’s natural gas fields. Demand multiplied, and multiplied again. Prices and profits could obviously be greatly increased, and private companies built more pipelines. A company established by Herman and George Brown, Texas Eastern Transmission, was allowed to purchase the Big and Little Inch—thanks to Lyndon Johnson’s intervention—for a cash investment of $143 million, a fraction of what it had cost to build them. Although Olds allowed price increases, increases viewed as generous by impartial analysts, he kept prices far lower than the companies would have set them. And the 9.5 percent return on their investment that the FPC allowed producers, while high enough so that the stocks of natural gas companies were among the most attractive investments on Wall Street, was far lower than what the producers wanted. The cost of the FPC policies to the oilmen was immense; it was estimated that an increase of five cents per thousand cubic feet in the price at the wellhead would increase the value of the holdings in Texas alone of the Phillips Petroleum Company by $389 million. As for Texas Eastern Transmission, it had sold 118,000,000 cubic feet of natural gas in 1948 at prices between seven cents and ten cents per thousand; deregulation would enable the Browns to charge several times those figures. And Texas Eastern had recently received FPC permission to build a new pipeline to New England, with a capacity of 200 million additional feet. Hundreds of millions of dollars were at stake. During 1948 and 1949, natural gas producers lobbied furiously for an end to federal regulation, and supported a deregulation bill introduced by Moore’s successor, Robert S. Kerr (a major stockholder in Phillips Petroleum). But in March, 1949, after Olds had testified against the Kerr Bill—testified not only convincingly, but, as one historian put it, “courageously,” since his renomination for a new five-year term would soon have to be confirmed by the Senate—President Truman, whose respect for Olds was as deep as President Roosevelt’s, vetoed the bill. A single figure was standing between the big producers, already the possessors of great wealth, and wealth far greater. Herman and George and their friends raged against him in letters to Lyndon Johnson. Olds “would establish ‘social responsibility’ in place of the profit motive. That is conclusive proof that he does not believe in our form of government,” Hugh Roy Cullen of Houston wrote. “There is nothing more important to the welfare of the natural gas industry in Texas” than that Olds’ confirmation be defeated, Charles I. Francis, a Brown & Root attorney, declared.
It was important for Johnson not only that Olds be defeated, but that he, Johnson, be given credit for that defeat. The oilmen had never been enthusiastic about Johnson; they had poured money into his 1948 campaign only because of Herman Brown’s personal assurances that he could be counted on. He would need their money for his 1954 re-election campaign—and for the campaigns he saw beyond. It was essential that he demonstrate to them that they could depend on him—that he could be counted on not just to work in their behalf, but to work effectively—and Olds’ renomination process was the ideal opportunity for such a demonstration.
“Olds was the symbol of everything they [the oilmen] hated,” recalls the former Texas legislator Posh Oltorf, who had now become Brown & Root’s principal Washington lobbyist. “He was just anathema to them because of his philosophy.” And because of something more important to these men than philosophy: money. Says John Connally, who would shortly leave the Wirtz law firm to become oilman Sid Richardson’s attorney: “This [Olds’ defeat] transcended philosophy, this would put something in their pockets. This was the real bread-and-butter issue to these oilmen. So this would prove whether Lyndon was reliable, that he was no New Dealer. This was his chance to get in with dozens of oilmen—to bring very powerful rich men into his fold who had never been for him, and were still suspicious of him. So for Lyndon this was the way to turn it around: take care of this guy!”
AND LYNDON KNEW how to take care of him. In 1944, the charges that Leland Olds was a Communist had not been taken seriously. But times had changed since 1944. China was being “lost”—and there was a steadily mounting crescendo of accusations that it had been lost because of the treachery of men in the American government. All through the summer of 1948, the House Un-American Activities Committee was holding hearings at which Whittaker Chambers was testifying to the existence of a Communist spy ring within the government, and in December of 1948, the microfilms of “documents of enormous importance” were found in a hollowed-out pumpkin on a Maryland farm—just where Chambers had said they were hidden. And all through 1949, there would be trials in New York not only of Alger Hiss for perjury but of eleven leaders of the American Communist Party for conspiracy to overthrow the government—and that trial would end in October with their conviction. In 1944, the Senate had not believed that Leland Olds was a Communist. It would be easier to make the Senate believe it now.
In the summer of 1949, Johnson asked Interstate Commerce Committee Chairman Ed Johnson for the chairmanship of the subcommittee that would look into Olds’ renomination—he had no difficulty obtaining the assignment; no one else was particularly interested in it—and he then persuaded “Mr. Wisdom” to allow the subcommittee to hold hearings on the renomination. And then he set about arranging the hearings.
First, there was the research. “He [Johnson] suggested that we bring in various experts,” recalls Representative John Lyle of Corpus Christi, a baby-faced congressman with a southern stem-winder’s gift for loud stump oratory, and a keen understanding of the importance of serving his constituents—particularly his district’s natural gas moguls, one of whom, Maston Nixon, the reactionary multimillionaire head of the Southern Minerals Corporation, had directed him to give Johnson any help he needed. The expertise required was in one particular field: Lyle was soon in communication with skilled investigators from the staff of the Communist-hunting House Un-American Activities Committee. A memorandum was prepared summarizing the information about Olds in the committee’s files. Supplementing these efforts with those of his own men (“We called in several of the brilliant young lawyers who were associated with Lyndon at that time in various matters,” Lyle was to recall), Johnson coordinated the overall effort.
Some of the research was in the area that, five years earlier, the Senate had agreed was the only relevant area: Olds’ long record in the job to which he was now being renominated. Ten years of formal FPC reports, drafts of reports, and internal memoranda were combed for evidence of anti-industry bias and for instances in which Olds had gone beyond the intent of Congress. That area proved unrewarding; it was, it was decided, better to avoid Olds’ record. But there were other areas of research—most particularly the area that, five years earlier, Lister Hill had said, and the Senate had agreed, was “immaterial” and “irrelevant.” The research into this area, Lyle recalls, was “very thorough.” Johnson’s investigators combed through bound volumes of scores of “newspapers that had come out during the 1920s,” Lyle was to recall. “We made copies of every statement that he [Olds] had made and every article that he had written.”
The coordinating of the research was done in Austin, Texas—by a master: Alvin Wirtz, who was the Austin lobbyist for many Texas oil and natural gas companies. One of the reasons that Wirtz was a feared figure to those who had had dealings with him was the combination of cruelty and guile that he possessed. The big, burly man with a broad, ever-present smile was gentle in manner but, a fellow lobbyist—a friend—says, “He would gut you if he could. But you would never know he did it…. He would still be smiling when he slipped in the knife.” And those qualities were very evident in a courtroom, where his agile mind (“slow in his movements, slow in his speech, but a mind as quick as chain lightning”) made him a fearsome cross-examiner who, with his soft voice and reassuring manner, excelled in leading witnesses into traps from which they could not extricate themselves.
The material assembled in Washington was loaded into Brown & Root’s DC-3 and flown down to Austin, and Wirtz and Johnson began consulting daily by telephone as the attorney hammered the evidence into shape.
Selectivity was the key. During his years with the Federated Press, Olds had written more than eighteen hundred articles. Out of them, Johnson and the investigators had selected fifty-four which, they felt, would most effectively influence senators against the nominee. And out of those fifty-four, they had selected portions—a paragraph from one, a sentence from another, sometimes merely a phrase—that highlighted what they wanted highlighted, and now, consulting with Johnson, Wirtz refined these into a presentation to be made to the subcommittee.
And finally there was the selection of the witnesses who would make the presentation.
Johnson, of course, could not be a witness; as chairman of the subcommittee, he had to appear impartial. So he decided that Lyle would be the main witness. Not only was Maston Nixon’s man on the Hill an effective public speaker, he was especially effective when speaking for a cause in which he believed, and he believed deeply that Red Russia was threatening America’s very existence. Now, Lyle recalls, the necessary “information” had been collected, and Lyndon Johnson “could translate that information into an effective weapon,” and he, Lyle, had no qualms about using that weapon; he could, in fact, hardly wait to use it. And Lyndon Johnson coached him on its use: “we spent hours and days discussing it.”
In selecting other witnesses, Johnson worked mostly through Wirtz, whose principal client was Brown & Root, and Ed Clark (himself the owner of forty thousand shares of Texas Eastern stock, purchased at seven cents a share) who was on retainer from oilman Clint Murchison, so that these clients would be told how hard their new senator was working on their behalf. (The two attorneys were in some respects very different. Clark, bluntly candid, unwilling to cloak his actions in some noble purpose, would have no patience with Johnson’s hints that what they were doing was to protect America from Communists. “He [Johnson] would call early in the morning—‘Communists! Communists!’ Bullshit! Communists had nothing to do with this, and he knew it, and I knew he knew it,” Clark says. On September 20, talking to Johnson’s secretary Mary Rather, Clark said, “I don’t care anything about these Communists. I wouldn’t look under the bed for Communists but I might look down there and hope I would find a blonde. The only reason I am interested in this hearing is on account of Mr. Murchison….” Wirtz, on the other hand, hated Reds almost as intensely as he did blacks.)
The two key attorneys sent lists of potential witnesses to Johnson in Washington—Clark, disdainful as always of consequences, put them in writing; Wirtz, always cautious, used the telephone—and from these lists, and from suggestions made by Maston Nixon and by Brown & Root’s Charles Francis, Johnson culled the names he wanted, interviewing some potential witnesses in person to determine their suitability for his purposes, and coaching them—sometimes at considerable length—on their testimony.
A FINAL ELEMENT in Johnson’s strategy was the element of surprise. This was vital. Not merely the Commerce Committee but the full Senate would have to be persuaded by the hearings to vote against the President’s nominee, a nominee with whom many senators had worked, a nominee of whom many senators were fond. The hearings must therefore be convincing—and at them Olds would have to be allowed to reply to the accusations that were going to be made against him. The accusations dealt with the fifty-four articles—some concerning complex economic issues, so a reply would have to be rather detailed. Adequate time to research the reply was therefore necessary; a witness who attempted to handle complicated issues without careful preparation was seldom convincing. Some of those articles had been written a quarter of a century earlier; Olds could hardly be expected to be familiar with them, or to answer questions about them in a convincing manner. And while only fifty-four articles were going to be introduced into evidence, they were part of a body of eighteen hundred articles. Were Olds to attempt to answer a question about one of the fifty-four, some of those other 1,746 articles might be quoted against him to ostensibly refute his replies, to make them appear evasive or misleading, because he had not taken them into account in his answer. With time to read the articles he might be able to answer convincingly, but unless this reading took place before the hearings, it would not be effective. Reading such a mass of material took time, and once damaging testimony was given, it had to be answered quickly, otherwise, the charges would take root in the consciousness of the senator-judges and their newspaper-reading constituents. And since the hearings would take only a few days, if Olds did not answer quickly, the hearings would be over, his fate decided. If he was to defend himself, he had to have time to prepare—and he couldn’t prepare unless he knew what was coming. So it was crucial that he not know.
Surprise was also vital because if Olds became aware of the scope and intensity of the attack that was to be launched on him, he might arrive at the subcommittee hearing with an attorney—an attorney experienced in such hearings and unintimidated by senators, an attorney who might, for example, request a recess if unexpected charges were suddenly made about writings or events that had occurred so long in the past that the witness needed an opportunity to familiarize himself with them before he answered questions about them. Many liberal Washington attorneys would have been willing to represent Leland Olds at the hearings. “He was a hero of mine,” the great liberal advocate Joseph L. Rauh was later to say; “I would have gone in a minute” had Olds asked him. So it was important that Olds not become aware.
Finally, there was potentially a great deal of support for Olds—not only from officials of rural cooperatives all across the country for which he had helped to obtain electricity, and from governors and mayors whose constituents’ natural gas bills had been reduced as a result of his efforts, but also from major figures of the New Deal aware of Olds’ role in implementing FDR’s policies. This support could be effective if it was organized and mobilized—as it would be should the seriousness of the threat to Leland Olds be recognized. So it was important that it not be recognized.
FOR A WHILE, keeping Olds and his liberal supporters from knowing what was coming was easy, for they believed that Lyndon Johnson was on their side.
The link that most strongly bound together the particular inner circle of New Deal liberals of which Johnson had been a part was the fight that had been a central element of both Leland Olds’ career and Johnson’s—the fight to break the power of private electric utility companies and bring electricity to farms: in Olds’ case, to all America’s farms, in Johnson’s to the farms of Texas’ Tenth Congressional District. Tommy Corcoran and Ben Cohen had drafted the legislation that broke up the utility monopolies and created the REA, Jim Rowe had been their young assistant in that drafting; Abe Fortas had devised the strategy that enabled the PWA to defeat the power companies’ lawsuits. And Johnson’s victory in his difficult fight to “bring the lights” to the Hill Country had seemed to this group to be a wonderfully concrete realization of the goal—“public power”—for which they had been fighting. If as a senator Johnson had backed the Kerr Bill, well, that was a necessary requirement for any senator from Texas, and it hadn’t anything to do with electric power, after all—and as for Lee’s renomination, surely Lyndon, the passionate advocate of public power, would not oppose one of public power’s greatest champions. In fact, Johnson had had dealings with Olds when he brought electricity to his district, and in these dealings, the two men had been in accord; Leland Olds felt that Lyndon Johnson was not only his ally but his friend. There had been a disagreement early in 1949, but only a brief one: Olds had rejected a Johnson request for a waiver of an FPC regulation that was causing complications on a Brown & Root construction project, but Johnson had quickly retreated. Olds believed that they were still basically on the same side—and that in the subcommittee hearing, he would have a friend in the chair. He believed, too, as did his friends, that these 1949 Senate hearings would be similar to the 1944 Senate hearings: the charge of “Communist” would be made; no one would take it seriously; even should the subcommittee vote against the nomination, his support in the full Senate was so overwhelming that he would certainly be confirmed.
For as long as possible, Johnson did nothing to disabuse the liberals of this notion. The nomination certificate from President Truman arrived at the Commerce Committee on June 5, and Olds assumed at first that renomination would be rather simple; “in fact,” he wrote a friend, “I am hoping that confirmation will be possible before June 22, when my present term expires.” A liberal Washington attorney who wrote to ask Olds, “What can I do to help out?” said that Johnson “is a good friend of mine but I would assume” he is “already convinced,” and that was the general assumption of the letters that arrived at Johnson’s office from such New Deal figures as Morris Cooke, the first REA administrator. Much of Washington’s liberal community was present on June 14 at a cocktail party for Americans for Democratic Action, and a steady stream of friends came up to Olds to congratulate him on being renominated; they regarded Senate confirmation as a matter of course.
Although June 22 passed without Johnson setting a date for the subcommittee hearings, for some time neither Olds nor his friends saw any significance in the delay. It seemed only a repeat of the 1944 renomination scenario, when his nomination had not been confirmed for almost four months after President Roosevelt sent it up, and almost three months after his term had expired—and, with the exception of Moore’s opposition (which proved to have no real significance), the explanation for the delays had been simply the usual Senate foot-dragging. Confirmation of appointees after their terms had expired was not, in fact, unusual in the Senate even for non-controversial candidates. During the summer, however, disturbing rumors began to be heard: that a whispering campaign was being carried on against Olds—and that the whispers were having an effect. In August Olds wrote a friend that there was a “good deal of opposition.” Ben Cohen had lunch with Lyndon Johnson, and then reported on the lunch to Tommy Corcoran—and afterwards Corcoran said he was “afraid of the decision now.”
Even then, however, the depth of Johnson’s opposition was not understood. Olds still believed, as did most liberals, that the leader of the Senate opposition was Oklahoma’s Kerr. They felt that Johnson’s opposition would be limited to the pro forma statements and vote against the nomination obligatory for a senator from the nation’s largest natural gas producing state. On August 18, Estes Kefauver spoke to Committee Chairman Ed Johnson, who, as Kefauver related to Olds, “rather agreed” that the “White House could probably bring Lyndon around.” A column by Thomas Stokes on August 25 carried a warning of “serious danger” to the confirmation, but did not even mention Lyndon Johnson’s name. It was only very gradually, as Summer turned into Fall, that Olds and his supporters began to suspect that a key figure in the opposition was the senator Olds had thought was his friend—the chairman of the subcommittee before which he would be appearing.
And then, on September 16, 1949, almost three months after his term had expired, Olds was finally notified of the date the subcommittee hearing would begin—September 27, just eleven days away; the first day would be brief and largely devoted to scheduling the roster of witnesses; the hearing would get under way in earnest on September 28. And in September, too, Johnson apparently let the mask drop away in a conversation with Olds, after which Olds wrote a friend that Johnson has “shown open hostility.” And in that month, also, the door to the trap that Lyndon Johnson had been preparing was revealed. When, earlier, it had first been announced that the hearing would be held, a five-member subcommittee had been named, and its membership seemed innocuous; one of the two Republican members, in fact, was Owen Brewster of Maine, who was well acquainted with Olds’ work, and admired it. Now it was revealed that the membership had been changed. There were to be seven members, not five, and Brewster was not one of them; instead, the three Republican members were three of the Midwest’s most rabid Communist haters: John W. Bricker of Ohio, Homer Capehart of Indiana, and Clyde Reed of Kansas. After sounding out Bricker about Olds’ nomination, White House aide Tom McGrath reported back that the Ohioan was “unalterably opposed.” The White House did not even bother sounding out Capehart and Reed. Several of the Democratic senators on the full Commerce Committee—Francis Myers, Charles Tobey, Brien McMahon, and Lester Hunt—were sympathetic to Olds. Not one was on the subcommittee. Its Democratic members, in addition to Lyndon Johnson, were Ed Johnson, Herbert R. O’Conor of Maryland, and Ernest W. McFarland of Arizona, all of them as rabidly anti-Red as the Republicans. White House emissary Oscar Chapman, returning from an attempt to persuade McFarland to at least keep an open mind, reported that their conversation had been “unsatisfactory,” mentioning “wild goose talk about commissions interfering with private business.” Wanting the subcommittee’s decision to be conclusive in the full, thirteen-member, committee, Johnson had enlarged the subcommittee so that if it was unanimous, the opinion of the rest of the committee wouldn’t matter; by the time the full committee considered the Olds nomination, a majority of its members would already be committed against him. And he had made sure that the subcommittee’s opinion would be unanimous. Not only had the witnesses been selected with care, so had the judges who would be hearing their testimony. The job had been done with Lyndon Johnson’s customary thoroughness. The subcommittee was stacked, completely stacked. Leland Olds would not have a single ally on it.
EVEN AFTER the subcommittee’s new membership had been announced, Lyndon Johnson maintained his pose when talking with liberal senators. Francis Myers of Pennsylvania visited his office to remonstrate about the “stacked [subcommittee,” but Johnson told him that conservatives had been put on it in the hope that when they heard the testimony, they would come to support Olds. And it was the chairman who ran a subcommittee anyway, he reminded Myers—and he was the chairman. Myers, evidently reassured, reassured Clark Clifford, who reassured Olds—as is shown by the note Olds made after his conversation with the White House counsel. “Lyndon going to do judicial job,” the note said.
The pose was successful. Olds finally began attempting to round up witnesses, writing a few old allies. “I am in a real fight,” he told Adolf Berle, an old New Deal friend from New York. “They are going to avoid the main issue and try to pin the communist or near-communist label on me…. I am wondering whether you would feel that you could come down to tell the Committee that I am a reputable citizen.” But not only was Olds writing these few letters—writing them at the last minute—after the campaign against him had been going on for months, the letters reveal that he was still unaware of the extent of that campaign, and of what the hearings would be like. While “the subcommittee is rather stacked against confirmation,” he wrote Berle, “the administration is going all out” and “I am confident of winning in the long run.”
Similar unawareness—and confidence—was still prevalent in Washington’s liberal community, where, despite warnings such as the one in Stokes’ column, the prevailing opinion remained that while there might be a tough fight, it would certainly end in victory. The President was committed; indeed, as Marquis Childs wrote, “seldom has such zeal been shown in behalf of a presidential nominee.” The confidence extended to liberal senators. Paul Douglas didn’t even bother to attend the hearings. “We thought it was going to be routine,” recalls his administrative assistant, Frank McCulloch. “We had no reason to know what was coming.”
No one, including Leland Olds, had any idea of what was in store for him when, on the morning of September 28, 1949, accompanied only by his wife and a single FPC aide—without an attorney, without having any idea of what evidence was to be presented against him (and, indeed, without having seen most of that evidence for more than twenty years)—he walked into the Senate Office Building, and came to the place of his hearing.