Read Ebook: Washington cover-up by Mollenhoff Clark R Clark Raymond

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"At the time that I gave those instructions, Mr. Hughes and Mr. Strauss, whoever else was involved, got together every single document that was pertinent to this thing and put it out."

The President concluded with a complete approval of the Wenzell role: "Now, as far as the Wenzell report, Mr. Wenzell was never called in or asked a single thing about the Yates-Dixon contract. He was brought into--as a technical adviser in the very early days when none of us here knew about the bookkeeping methods of the TVA or anything else. He was brought in as a technical adviser and nothing else and before this contract was ever even proposed."

President Eisenhower seemed to have no information about Wenzell's role after January 1954. His comments seemed completely contrary to the testimony already taken before the Kefauver Subcommittee on Antitrust and Monopoly. I followed up the Van De Linden question.

"Mr. President," I said. "A little while ago you stated that Mr. Wenzell was never called in about the Yates-Dixon contract, and there seemed to be some testimony before the SEC and before a committee that he served as a consultant. I wonder if you were--"

The President cut in to answer that "He did serve as a consultant at one time."

"Of Dixon-Yates?" I asked it fast.

"No; I think--now, I will check this up," the President started. "My understanding is that quickly as the Dixon-Yates thing came up he resigned, and we got as our consultant a man named Adams from the Power Commission here itself to come over and be consultant so as to have him because he was connected with a great Boston financial company."

"Mr. President," I asked. "Had you been informed that he had no connection at all with the Dixon-Yates--?"

"My understanding of it, and it may have been--that part of it there may have been--an overlap of a week or two, there I am not sure of," President Eisenhower answered. It was difficult to understand he had so little information on the key issue at this late date.

"Would there be any change in your position on that if there was material that he had served as a consultant on that ?" I asked.

"If he had served as a consultant on that and brought in a definite recommendation to us I would be very delighted to make that public," President Eisenhower answered. "But I just don't believe there is a thing in it about it. However, I will have it checked again."

Noting the press conference statement, Senator Kefauver fired off a quick letter to President Eisenhower:

"My Dear Mr. President: I have just been informed that in answer to questions of the press today you are recorded as saying that Mr. Adolphe H. Wenzell was never called in or asked a single thing about the Dixon-Yates contract, and that as quickly as the Dixon-Yates matter came up Mr. Wenzell resigned. However, you say you will have it checked again."

Then Senator Kefauver followed up with a careful chronological study of the testimony of Wenzell and other key officials in the Eisenhower administration which showed that Wenzell had been a consultant on the Dixon-Yates contract. It also showed that high Eisenhower administration officials knew, or should have known, the precise role that Wenzell had filled.

At his next press conference, on July 6, 1955, President Eisenhower said Wenzell's role was perfectly "proper" in Dixon-Yates, but indicated there was a chance the contract might be canceled.

Senator Kefauver sought an explanation of the Sherman Adams calls to the SEC that had postponed hearings on the financial arrangements for Dixon-Yates at the crucial point before the House took up the appropriation measure.

On July 21, Adams refused to testify before the Kefauver investigating subcommittee. In a letter to Senator Kefauver he stated that he could not give testimony because of his confidential relationship to the President, and also because "every fact as to which I might give testimony either has been or could be testified to fully by other responsible government officials."

The same day Kenneth Fields, general manager of the Atomic Energy Commission, wrote to Kefauver declining to furnish documents on ground they were "privileged communications within the executive branch." Earlier, SEC Chairman Armstrong had made his first refusal to testify on his conversations with Sherman Adams.

Senator Kefauver replied to Adams that there had been consistent claims of "executive privilege" that barred the investigators from obtaining the truth.

"No official of the Government," the Senator wrote, "no matter how high his position can properly claim privilege when a committee of Congress is seeking the facts in respect to corruption."

Senator Kefauver stated: "In these circumstances a claim of privilege is tantamount to suppression of evidence of possible crime and corruption. Not even the privilege of attorney-client can be used for such a nefarious purpose."

At the July 27, 1955, press conference I questioned President Eisenhower to determine what he knew of the activities of Sherman Adams in the Dixon-Yates affair.

"Mr. President," I said. "There has been testimony of the SEC Chairman that Sherman Adams intervened before the SEC, which was a quasi-judicial body. Testimony was given by the chairman on that score.

"The Democrats are contending that there was something improper in intervening with any quasi-judicial body. I wonder if you looked into that and if you have any comment you would like to make about it."

The President replied that he had "looked into it only to this extent: I am sure that Mr.--head of the commission--has given the entire story. I understand that he is back before the committee. And certainly if he has omitted any details, he should give them now."

The President continued: "And I believe that Governor Adams has informed the Senate committee that he hasn't a single detail to add; that the story has been told and that is all there is to it."

"In connection with the Dixon-Yates matter, and in view of the fact that the Senate investigation subcommittee recently brought out the first time the part played in initiating the Dixon-Yates contract by Adolphe Wenzell, of the First Boston Corporation, which corporation later became the financing agent for Dixon-Yates. In view of all that, do you believe your directions last summer for disclosure of the complete record in the case were carried out by the agencies concerned?"

President Eisenhower replied: "Well, I didn't know that anyone had alleged that he was the initiator, because no such statement has ever been made to me.

"But what I have done is this: I have gotten back Mr. Dodge, who was Director of the Budget when all this was done, when the 1954, I believe, policy on this statement, on this whole proposition was made, and he is going now before one of the committees."

The President turned to Press Secretary James C. Hagerty to ask: "Isn't that correct?"

Hagerty answered, "Yes, sir."

The President continued: "He is going down before one of the committees with instruction to do this: to tell every possible item that has anything whatsoever to bear on Dixon-Yates, and see whether we can get the whole list of information properly coordinated and placed before the people that are investigating it."

President Eisenhower still had not answered the question relative to whether he knew that his August 1954 order on complete disclosure on Dixon-Yates had been violated. I followed up the question of Garnett Horner:

"I hate to go back to Dixon-Yates again, but there was one thing I don't think was completely clear. There were some AEC officials, Mr. Fields and Mr. Cook, who testified that Mr. Wenzell's name was knowingly eliminated from the Dixon-Yates chronology; and, of course, they stated this was on the recommendations of the Bureau of the Budget.

"I wonder if you knew anything of this, and if you did know of it, if you would like to comment on whether you thought it was important."

The President knew little about the Dixon-Yates contract even at this late date, more than a year after it had first been criticized by Democrats. His answer reflected his lack of knowledge, as well as his desire to shut off further questions.

"I don't intend to comment on it any more at all," he said. "Now, I think I have given to this conference time and again, the basic elements of this whole development, and everything I could possibly be expected to know about it.

"I said Mr. Dodge, who initiated this whole thing, is going down before the committee to again begin the process of taking this thing from its inception and following it through until he turned over to Mr. Hughes, and I believe that Mr. Hughes is to be there if they want him again.

"Now, they can tell the entire story, and I don't know exactly such details as that. How could I be expected to know? I never heard of it."

It would have been difficult to imagine a case that dramatized more clearly the bad government that could fester under arbitrary executive secrecy. President Eisenhower had issued an order for a full chronology of events leading up to the Dixon-Yates contract, but, instead, his subordinates had put out a record edited to eliminate the names of persons involved in a "conflict of interest."

The secrecy deceived the public, deceived the committee of Congress, and even deceived President Eisenhower. His comments over the period of months showed that his subordinates had misled or deliberately deceived him on the key point in the controversy--the role of Adolphe Wenzell. In this respect the secrecy possible under "executive privilege" worked against the best interests of President Eisenhower. Apparently his subordinates thought they could distort the record, and keep it hidden from the public and the President. Only the persistent work of Senator Kefauver's investigators pulled loose sufficient facts to document the deception.

President Eisenhower might have been able to sell the Dixon-Yates contract to the public if it had been handled as a simple debate of private power versus public power. But he could no longer see it through once he had been forced to take note of a "conflict of interest" that he had previously denied existed.

Cancellation of the Dixon-Yates contract did not end the Eisenhower administration's problem with that ill-fated venture. It was to be a major factor in 1959 in blocking the nomination of Lewis L. Strauss as Secretary of Commerce.

In November of 1955, William Mitchell, counsel for the Atomic Energy Commission, made a report stating: "It appears that Wenzell, while having a conflicting private interest, acted as one of the principal advisers of the government" in the negotiating of the Dixon-Yates contract. Mitchell called attention to the many meetings in which Wenzell had taken part as a government official in the first four months of 1954.

"The matters on which Wenzell was advising the contractor were the same on which he had been employed to advise the government," Mitchell stated officially for the AEC.

When the government canceled the contract on grounds of a "conflict of interest," the Dixon-Yates group claimed that tremendous expenditures had already been made on the contract. When Dixon and Yates sued the government for ,534,788, the Justice Department was forced to go to court with legal briefs and facts to support the government contention that Wenzell's role was a "conflict of interests."

Thus Attorney General Brownell's department was in court to give evidence of an impropriety that President Eisenhower had said did not exist.

Less than a year later, on August 11, 1956, Senator Estes Kefauver and Senator Joseph O'Mahoney, the Wyoming Democrat, insisted on action against those engaged in concealing the facts.

Senator Kefauver charged that Sherman Adams and other "high officials of the Eisenhower administration" violated the criminal law in their handling of the Dixon-Yates contract. He named the other high officials as Lewis L. Strauss, chairman of the Atomic Energy Commission and the President's adviser on atomic energy matters; Rowland R. Hughes, former Director of the Budget; and J. Sinclair Armstrong, chairman of the SEC.

In asking Attorney General Herbert Brownell to present the matter to a federal grand jury, Kefauver commented:

"Indictments and convictions have been obtained under Section 371 of Title 18 of the United States Code in cases involving similar circumstances. The offense under this section of the Criminal Code is that of conspiring to defraud the United States Government. The essential ingredient of the offense under this section of the Criminal Code is the failure of a government official to discharge conscientiously the duties of his office and administer Federal law in an unbiased manner."

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