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The World Behind Watergate

The bedfellows politics makes are never strange; it only seems that way to those who have not watched the courtship. In Richard Nixon’s case, notwithstanding his presence in national politics for the last twenty-five years, those courtships have remained remarkably unexamined—or, when examined, remarkably misunderstood—and as a result the bedfellows he has acquired have remained unusually obscure both to the public and to the political pundits who are supposed to conjure with such things. Certain obvious relationships, to be sure, have been given attention—the back-scratching of Nixon and his old friend and Pepsico chairman Donald Kendall, for example,1 the latest evidence of which is Washington’s gift of the Soviet soft-drink franchise to Pepsi-Cola. But the wider pattern of his associations, the character of his power base, remains essentially obscure. This seems particularly dangerous in view of the evidence that these people will be influential in American government not only for the next four years but for the foreseeable future.

The Nixonian bedfellows, the people whose creed the President expresses and whose interests he guards, are, to generalize, the economic sovereigns of America’s Southern rim, the “sunbelt” that runs from Southern California, through Arizona and Texas, down to the Florida keys. They are for the most part new-money people, without the family fortunes and backgrounds of Eastern wealth (Rockefellers, DuPonts, etc.), people whose fortunes have been made only in the postwar decades, mostly in new industries such as aerospace and defense contracting, in oil, natural gas, and allied businesses, usually domestic rather than international, and in real-estate operations during the postwar sunbelt population boom.

They are “self-made” men and women, in the sense that they did not generally inherit great riches (though of course in another sense they are government-made, depending, as in oil and aerospace, on large favors from Washington, but they hardly like to think of it that way), and they tend to a notable degree to be politically conservative, even retrograde, usually anti-union, antiblack, anticonsumer, and antiregulation, and quite often associated with professional “anti-communist” organizations. Whether because of the newness of their position, their frontier heritage, or their lack of old-school ties, they tend to be without particular concerns about the niceties of business ethics and morals, and therefore to be connected more than earlier money would have thought wise with shady speculations, political influence-peddling, corrupt unions, and even organized crime.

The political ascendancy of these Southern-rim people—those whom Carl Oglesby once called “the cowboys,” as distinct from “the yankees” of old Eastern money—has taken place coincidentally with their economic growth in the last generation. Their power on a state level was solidified a decade or so ago, and they made certain inroads to national influence with Johnson’s assumption of the presidency in 1963.2 But it was not until the election of Richard Nixon in 1968—and even more now during a second term in which he seems far beyond mediating pressure from the press, Congress, and public—that the Southern-rim bedfellows were firmly installed in the bedrooms of political power in Washington. It is a fitting symbol of this that Nixon has established White Houses at the two extremes of the Southern rim, San Clemente and Key Biscayne.

Now it is certainly true that the yankees retain considerable power in national politics, that the Wall Street investment houses and the family banks and the well-established holding and insurance companies still have influence throughout local and federal government. No one would want to suggest that David Rockefeller or the First National City Bank was inconsequential in guiding the affairs of state—and the important position of Henry Kissinger, a man with authentic yankee ties (Harvard, Rockefeller Brothers Fund, Council on Foreign Relations) attests to their continuing influence. What is important to note, however, is the relative decline of the yankees in recent years and their relinquishment of important powers to cowboy hands. Moreover, as the economic importance of the Southern rim has increased, New York banks and investment houses (notably Loeb Rhoades and Lehman Brothers) have bought into its businesses, with the result that to a greater extent than before the interests and wishes of the cowboys have become of serious concern to the moguls of Wall Street.

One rough measure of the political ascendancy of the cowboys is the number of them who actually occupy high positions in Washington. Of the four members of what Nixon likes to call his “super-super cabinet,” three of them—the three with the highest authority in domestic affairs (the fourth is Kissinger)—are from the Southern rim: Roy Ash (California: millionaire defense contractor), John Ehrlichman (California, out of Seattle: lawyer, politico), and Bob Haldeman (California: PR man). On the cabinet level there are Anne Armstrong (Texas: Republican politico), Claude Brinegar (California: Union Oil executive), Frederick Dent (South Carolina: textile millionaire), Richard Kleindienst (Arizona: Goldwater crony), and Caspar Weinberger (California: Republican politico and ex-Reagan aide).

Of the five Nixon nominees to the Supreme Court, three (Rehnquist, Carswell, and Haynesworth) were wool-died Southern-rim conservatives and one (Powell) was a right-wing Virginian who was also a director of oil and gas corporations. The key appointments to the increasingly powerful Republican National Committee have all been from the Southern-rim—co-chairpersons George Bush (Texas: oil company co-founder) and Janet Johnston (California: rancher) and general counsel Harry Dent (South Carolina: lawyer, ex-GOP state head). The rim influence is here so strong that there have even been published complaints from Mid-western Republicans about a “Southern Mafia.”3

And peppered throughout the government are such key cowboys as press secretary Ronald Ziegler (California: public relations), Frederic Malek, second-in-command of the budget (South Carolina: tool-manufacturing millionaire), Commissioner of Education John Ottina (California: defense industry consultant), Director of Communications Herbert Klein (California: Copley Press executive), Deputy Secretary of Defense William Clements (Texas: oil millionaire), Assistant Agriculture Secretary Robert Long (California: Bank of America executive), Undersecretary of State William Casey (a New Yorker, but director and counsel of a Southern-rim agribusiness corporation)…. And on and on, scores more throughout the top levels of the Administration, not even balanced this term by very many liberals and Easterners.

A second measure of cowboy penetration is their preponderance among Nixon’s major financial supporters. Though the loopholed campaign-spending laws permit only partial identification of the top money men, it seems clear at least that the chief sources of Nixon’s campaign finances—and therefore presumably the people whose interests the President will try to keep dominant—are independent oil producers, defense contractors, right-wing unions, rich conservative businessmen, and various Southern-rim manufacturers. This does not mean, of course, that the more traditional sources of Republican money, such as the old-money families and yankees new and old throughout the financial world, have been thoroughly displaced or no longer make big contributions, but only that their position is being steadily narrowed and their importance therefore steadily decreased.

Oil money, for example, has always found its way into politics, as much from the old corporations with chiefly international interests as from the new independents who have sprung up along the Southern rim. 4 But it has been the latter who have been most important in Nixon’s career, from such supporters as Union Oil, Superior Oil, and Texas ultraconservative H. L. Hunt, who helped finance his early campaigns, through California right-winger Henry Salvatori, the Texas Murchison family, and at least a third of the backers in the 1952 “slush fund.” In this last campaign there were some large contributions from old oil—Richard Mellon Scaife (Gulf Oil, among other interests) gave $1 million, the Phipps family (Texaco among others) gave at least $55,000—but the striking fact is the number of domestic oil donors, rimsters or with rim interests, people like Kent Smith (Lubrizol, $244,000), Francis Cappeart (Southern oil and agribusiness, $174,000), John Paul Getty (Getty Oil, $97,000), John J. Shaheen (Shaheen Natural Resources, $100,000), Elisha Walker (Petroleum Corporation of America, $100,000), Max Fisher (Marathon Oil, $60,000), the O’Connor family (Texas Oil, $60,000), and the Osea Wyatt family (Coastal States Gas, $41,000).5

Other major sources of support in the last campaign can be traced, too, and they follow the same general pattern: some sizable donors from the old-money families and new-money Easterners, but surprising strength from the Southern rim. Among the largest donors with defense interests last year were yankees like Arthur Watson (IBM, $303,000) and Saul Steinberg (Leasco, $250,000), but they were matched by the rimsters, people like Charles and Sam Wyly (Dallas computer company, $172,000), Thomas Marquez (Electronic Data Systems, Dallas, $88,000), Howard Hughes (Hughes Tool, etc., Houston, $100,000), Ling-Temco-Vought (Texas, $60,000), and Litton Industries ($18,000).

Southern-rim new-money businessmen included Walter T. Duncan (Texas, real estate, $305,000), Sam Schulman (California, National General conglomerate, $257,000), John and Charles Williams (Oklahoma manufacturers, $98,000), M. B. Seretean and Eugene Barwick (Southern textile manufacturers, $200,000), Anthony Rossi (Florida, Tropicana, $100,000), C. Arnholt Smith (California financier, $50,000), and L. B. Maytag (Florida, National Airlines, $50,000). Donors among the major organizations include three with extensive rim contracts, the Texas-based Associated Milk Producers ($782,000), and two right-wing unions, the Seafarers (with direct oil and agribusiness links, $100,000) and the Teamsters (with heavy investments from Southern California and Las Vegas to Miami, an estimated $100,000).

Perhaps an even more revealing measure of the rimsters’ influence is their dominance of the Nixon inner circle. Now their numbers are hardly legion, because this President is an essentially friendless man, a distrustful person with few close cronies, but the few that exist are, almost to a man (no women), from the sunbelt states. The only visible exceptions are Donald Kendall and Secretary of State William Rogers, both solid Easterners, and even they are new-money, up-from-poverty types.

The rest are people like Southern California businessmen Jack Drown, Ray Arbuthnot and C. Arnholt Smith, California politician Robert Finch (a friend, apparently, even after his fall from office), and four men who seem to be closest of all to the President: Herbert Kalmbach, a rich Los Angeles lawyer who is the President’s personal counsel and was his chief fund raiser during 1971; John Connally, the oil-tied Texas politician who is Nixon’s financial guru and reportedly his choice as successor; Murray Chotiner, the California lawyer who has been with Nixon since the beginning and during 1971 and 1972 was with him in the White House; and Bebe Rebozo, the Florida millionaire who is reckoned to be the most intimate of all with the President. All of these are fairly typical Southern rimsters, all are new-money people, all are well-off, and all of them (except maybe Finch) are politically conservative. Most disturbing of all, several of these people have had the taint, and sometimes the full stigma, of scandal around them.

This last attribute deserves somewhat more attention, for it is inevitably one of the most striking features of the political cowboys and one with very serious implications for our national life. Without going into a full portrait of the noisome character of so much of the Southern rim—home of well-established organized-crime centers in such places as Las Vegas, New Orleans, and Miami, the last having lately become a veritable Marseilles—one can still note that many of Nixon’s closest friends from this region are, to a remarkable and unhealthy degree, guilty of improprieties in business, a certain disregard for public trust, a general lack of ethical sophistication, or in some cases direct association with criminal figures. To cite a few examples:

  1. 1

    Evidence of their cozy relationship may be found in Leonard Lurie, The Running of Richard Nixon (Coward, McCann, and Geoghegan, 1972), and Earl Mazo and Stephen Hess, Nixon (Harper & Row; Popular Library, 1968).

  2. 2

    Johnson’s assumption of power had several consequences beyond the enthronement of a man heavily in political debt to conservative Texas oil, among them the squelching of the Bobby Baker and TFX-Convair (Dallas) investigations, the exercise of American pressure to forestall a threatened nationalization of American oil interests in Argentina, and the reversal of Kennedy’s announced plans to begin withdrawing troops from Vietnam.

  3. 3

    New York Times, March 27, 1973, p. 27.

  4. 4

    There have been several valuable surveys of the effect of oil on politics, among the best of which are Ronald Dugger, Atlantic, September, 1969; Robert Engler, The Politics of Oil (Macmillan, 1961); Erwin Knoll, New York Times Magazine, March 8, 1970; Morton Mintz and Jerry S. Cohen, America, Inc., Chapters 4 and 5 (Dial, 1971); Robert Sherrill, The Accidental President (Grossman, 1967, Pyramid, 1968); and Michael Tanzer, The Political Economy of International Oil and the Underdeveloped Countries (Beacon, 1969).

  5. 5

    These figures are from the Citizens Research Foundation of Princeton, New Jersey, a group that tries to keep track of all the sources of campaign money. They are generally only estimates and often represent only a small part of what was actually given. Other major oil donors and fund raisers on the CRF lists include Arthur E. Johnson (Midwest Oil), Thomas Pappas (Esso-Pappas), the Pew family (Sun Oil), William Liedtke (Pennzoil), J. A. Vickers (Vickers Petroleum), and H. W. McCollum, Philip Kramer, and J. D. Callender (Amerada Hess).

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