by Sally Denton
Secret CIA plots to destabilize the Cuban government and assassinate Castro had also backfired. Kennedy, a Democrat, was under intense criticism from Republican critics who accused him of being soft on Communism. “With his paper-thin mandate and a majority of only six in the Senate, he believed the problems of his administration would come primarily from the right, and felt impelled to make overtures,” historian Barbara Tuchman described Kennedy’s decision to hire McCone. Hoping the appointment of a right-wing zealot would fend off his enemies, he settled on McCone, whom his father, Joseph P. Kennedy Sr., had known from their wartime shipbuilding days. Joe Kennedy had the government contract for shipyards in Massachusetts. McCone was appointed “at a time when the agency was expanding its arrangements with American corporations to provide cover to CIA operatives and to share in intelligence gathering, particularly in countries like Iran, Algeria, and Libya, where Bechtel was constructing, designing, or pursuing large projects,” according to a later press account.
“He shuns the press, makes no public speeches, grants no interviews,” wrote Jack Anderson about McCone. Anderson, who was Drew Pearson’s associate at the Washington Merry-Go-Round column and who would become known as the father of modern investigative journalism, joined Pearson in exposing the kind of cronyism he thought McCone embodied. “Even on his rare appearances before congressional committees, he speaks softly and scarcely moves his lips,” Anderson described McCone. “During his first year as boss, he has drawn the cloak of invisibility ever tighter around the CIA. He would like it to vanish from the limelight altogether.” A humorless man, McCone had moved to shake up the CIA, making it what Anderson called a “tauter, more efficient cold-war instrument,” dubbed “McConey Island” by his detractors. He grasped the significance of the modern and evolving information-gathering technology. Obsessed with the National Security Agency’s inability to break high-level Soviet codes, he sought to assert the CIA’s leadership in this area. A “disciple of massive retaliation,” Barbara Tuchman wrote of McCone, “who, in the opinion of the Neanderthal Senator Strom Thurmond, ‘epitomizes what has made America great.’ ”
The CIA during these early Cold War years was engaged in what political scientist Andrew J. Bacevich described as an “all-out, no-holds-barred conflict” with the Soviet Kremlin, its clandestine wars “wrapped in an armor of moral certitude.” Engaged in actions that under most circumstances would have been considered repugnant, if not diabolical, the agency was systematically “disseminating false information, suborning foreign officials, planning acts of sabotage, overthrowing governments, and ordering assassinations.” McCone advocated overt intervention as well as more clandestine plots. While he had taken the position that an embargo against Cuba was preferable to a full-scale invasion, he also felt that if a military offensive became necessary, that it should be done with sufficient force “to occupy the country, destroy the regime, free the people, and establish in Cuba a peaceful country.”
If brought in to reform an out-of-control organization, McCone’s “Central Intrigue Agency,” as Drew Pearson called it, would instead become what Kennedy’s vice president, Lyndon Johnson, described as “a damned Murder Inc.” If McCone’s elevation to director of the CIA was meant to curb that agency’s meddling in foreign intrigues, it had the opposite effect. While McCone was director, the CIA escalated its black operations, spearheading numerous covert plots around the world, including Laos, Ecuador, and Brazil. He directed the 1963 coup that brought the Ba’ath Party to power in Iraq and by decades-end gave rise to a “twenty-six-year-old Tikriti street thug named Saddam Hussein (himself a CIA-paid asset) along with lists of hundreds of left-leaning Iraqi political figures and professionals to be murdered after the coup,” according to a former national security advisor. He also supplied mercenaries and arms to Joseph Mobutu, the corrupt and vicious leader of the Congo, where Bechtel and other American corporations had vast investments in copper, gold, and diamond mines.
On November 22, 1963, McCone was lunching in his private dining room at the CIA headquarters in Langley, Virginia, with his deputy director, Richard Helms, when he heard the news that President Kennedy had been shot in Texas. At the time, the CIA had gotten so out of hand that Helms wondered aloud if CIA operatives were involved in the president’s assassination. “Make sure we had no one in Dallas,” Helms said to an aide moments after learning of the shooting. McCone then rushed to Robert Kennedy’s home in McLean, Virginia, and stayed with the president’s brother for three hours while no one else was admitted to the Hickory Hill compound—not even the family priest. “McCone’s agency had been trying to kill Castro, and just two months earlier Castro had threatened to retaliate if the assassination attempts continued,” Anderson wrote, claiming that the two men anguished over the possibility that the assassination was blowback from the CIA attempts on Castro. When word came that the president had died, they “walked back and forth, back and forth, between the tennis court and the swimming pool,” according to Kennedy aide Arthur Schlesinger. In one of the most dramatic exchanges in American history, Kennedy asked McCone: “Did you kill my brother?” Kennedy later said that he believed McCone’s answer that the CIA had not been involved in the assassination. “I asked him in a way that he couldn’t lie to me, and they hadn’t,” he told his aide Walter Sheridan.
The following day, McCone briefed President Johnson and told him that intelligence reports suggested “Castro was behind the assassination.” Assassin Lee Harvey Oswald had not only visited the Soviet Embassy in Mexico City, meeting with the consul, a KGB agent named Valeriy Kostikov, who was an assassinations specialist, McCone told LBJ, but Oswald “had also gone to the Cuban consulate.” A month later, McCone told Johnson aide Bill Moyers that he did not believe that Oswald had acted alone. “McCone thought there were two people involved in the shooting,” Moyers related his conversation with McCone to Schlesinger.
CIA documents declassified in 2013 revealed that Castro felt he was being set up to take the blame for the crime, which would have spurred the US invasion of Cuba that hawks such as McCone and others in the administration had long advocated. In the aftermath of the assassination, Castro sent a back-channel message to Washington that he wanted to meet with investigators “to dispel the swirling allegations that Cuba was responsible.” The day after the assassination, Castro publicly labeled the assassination “a Machiavellian plot against our country” to justify “immediately an aggressive policy against Cuba . . . built on the still warm blood and unburied body of their tragically assassinated President.”
Indeed, according to the CIA documents, at the time of his death, Kennedy had reached out to Castro about normalizing relations between the two countries. At the moment Kennedy was shot, Castro was meeting with an emissary whom Kennedy had sent to Havana on a “mission of peace”—a prospect anathema to reactionary sectors in American government. The two men were lunching in Cuba, discussing Kennedy’s offered olive branch, when Castro received a phone call reporting that Kennedy had been shot. “This is terrible,” Castro told the messenger. “There goes your mission of peace. They are going to say we did it.”
McCone, especially, was apoplectic at the possibility of rapprochement with Cuba, advocating the “most limited Washington discussions” on accommodation with Castro. He continued peddling the Castro connection theory long after the Warren Commission investigating Kennedy’s assassination dismissed it. Johnson kept McCone on at the CIA where he was among the warmongers in the administration, becoming one of the earliest promoters of intervention in Southeast Asia. McCone had disagreed adamantly with JFK’s interest in seeking conciliation with the Soviet Union, and, especially, with his decision to try to withdraw from Vietnam. He preferred LBJ’s Vietnam policy, and in a memorandum to the president, he recommended the deployment of more troops to “tighten the tourniquet” on North Vietnamese Communists. Bechtel would be one of the two top contractors to build the Vietnam War infrastructure; the other was Texas-based Brown and Root, wh
ich for decades had financed LBJ’s rise to power, and would later become Halliburton. “The two firms built air bases, landing fields, military compounds, roads, ports, support facilities, and energy depots throughout Southeast Asia,” according to one history. A postwar audit by the Congressional Budget Office would reveal that Bechtel and Brown and Root “had billed the government for so much concrete that they could have put a concrete skin eight feet deep over the entire country of Vietnam.”
In the end, McCone’s legacy in both government and industry would be one of global saber rattling, covert intervention, war profiteering, and billion-dollar energy and defense contracts for his associate on the West Coast. McCone was “the greatest organizer in the United States,” Steve told Jack Anderson.
CHAPTER TEN
Weaving Spiders
“In the councils of government, we must guard against the acquisition of unwarranted influence whether sought or unsought, by the military-industrial complex,” President Eisenhower had warned in his 1961 farewell address to the nation. “The potential for the disastrous rise of misplaced power exists and will persist.” He cautioned against the unhealthy alliance between defense contractors, the Pentagon, and their friends on Capitol Hill. “We must never let the weight of this combination endanger our liberties or democratic processes,” he continued. “We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals so that security and liberty may prosper together.”
Yet even Eisenhower could not have foreseen the near-total influence the defense industry would have over American foreign policy in the coming decades. Among the inherent ironies of Eisenhower’s grim prescience is how two of his associates—John McCone and Steve Bechtel—would become iconic figures of his envisioned military-industrial complex. “Rarely does a big Pentagon construction project surface that doesn’t have a role set aside especially for Bechtel,” a press account said of Bechtel’s twenty-first-century position as one of the country’s top defense contractors.
Eisenhower had long worried about a post–World War II Japan turning toward China and Russia, sounding an alarm as early as 1954 that the shift of Indochina toward Communism would usher in such a tilt and declaring that the “possible consequences of the loss of Japan to the free world are just incalculable.” Steve Bechtel, along with fellow California industrialists, was at the forefront of developing a Pacific Rim strategy that would open the resources of Southeast Asia to American capitalism. To Bechtel, the Vietnam conflict extended far beyond the battlefield—although his company was profiting from the war—into the creation of what one newspaper account described as a San Francisco–based “powerhouse gateway to hundred-million-dollar business ventures in the Pacific.”
The intellectual thrust of this new Pacific Republic headquartered in the San Francisco Bay Area was the potent Bechtel-dominated think tank, the Stanford Research Institute (SRI). Initially conceived by President Hoover, SRI was created by a group of West Coast businessmen in 1946 and modeled on the Chicago-based Armour Research Foundation’s stated principles of “the Co-ordination of Motives, Men, and Money in Industrial Research.” Steve was a founding director of SRI—a high-technology scientific research organization that was affiliated with Stanford University. It would become the second-largest corporate-government funded policy institute in the country and the largest contract research firm in the world. “SRI’s Pacific Rim strategy, however, amounted to nothing more than a sophisticated rephrasing of the domino theory,” one critic charged, quoting an official SRI document that the “war in Vietnam . . . must be viewed as a struggle likely to determine the economic as well as the political future of the whole region.” Steve was the most influential SRI policy maker, who “kept asking that the amount of international work be ‘doubled and doubled’ again . . . his perseverance was exceeded only by his insistence.” SRI’s close alliance with the US Defense Department would ultimately incite violent antiwar student protests in the spring of 1969, prompting Stanford University to sever its ties with the controversial facility. Privately, Steve railed against the campus demonstrators, calling them Communist rabble-rousers antithetical to his professed motto of “devotion to family, country, and company.”
The Bechtel family donated millions to SRI and reaped enormous rewards from its applied research projects and economic analyses. “Among its many programs, SRI evaluated the US strategic force; conducted laser radar studies in the upper atmosphere; analyzed ballistic missile defenses; drew up studies for improving Air Force reconnaissance and surveillance systems and played a leading role in developing the US response to the launching of the Soviet Sputnik satellite,” according to one published report. SRI conducted untold numbers of studies for Bechtel’s direct financial advantage, including a probe into the development potential of a tiny fishing village in Saudi Arabia, where Bechtel would receive a contract to build a city from the ground up. That city would ultimately swell to a population of 370,000.
As the family’s first billionaire, Steve had spent six months of every year roaming the world, “hobnobbing with kings, presidents and foreign business magnates, fishing for projects,” Time magazine once reported. “In his overseas dealings, Bechtel has been like one of [Rudyard] Kipling’s admired Men Who Get Things Done, forming partnerships with native firms when required and employing local help,” as California writer John van der Zee explained Steve’s business practices. He was so powerfully connected in the region, he once called in the British Royal Air Force “to buzz a group of bickering Arab tribesmen until they were frightened back into pipeline work.”
During this period, Steve took a “more relaxed” approach to soliciting business, taking a trip around the world with no particular aim, as Bechtel Vice President Jerome Komes recalled. He “would fly to London for lunch with old friends from British Petroleum or to pay a courtesy call on the head of Imperial Chemical Industries. In Paris, [Steve’s party] would discover that J. Paul Getty was staying in the same hotel, Steve would give him a call, and they would get together to talk about world business—Getty’s concession in Kuwait, for example.” President of Getty Oil Company, the American tycoon had amassed billions from a sixty-year oil concession he obtained from Ibn Saud in 1949 to drill in a barren tract of land between Saudi Arabia and Kuwait where no oil had previously been discovered.
Given Steve’s legendary hands-on involvement, it came as a surprise when, with little fanfare, he turned over the company to his thirty-five-year-old son, Steve Jr., on Christmas Day 1960. Steve Sr., as the father was now called at the company to distinguish him from his only son, remained a behind-the-scenes dynamo, with the title of chairman. Retiring as a fit and energetic sixty-year-old—then second only to oil-tanker tycoon Daniel Ludwig as the richest man in America—was an unprecedented move for a proactive CEO of a multinational corporate empire. But he thought his son ideally suited to usher the company into its third generation of leadership. When Steve Sr. had taken over, Bechtel had revenues of less than $20 million. At his retirement a quarter century later, the company’s reported sales were $463 million. In the decade between 1950 and 1960 alone, revenues had more than doubled. Fortune proclaimed his legacy as “the boldest and maybe the biggest builder in the world,” placing his name alongside Henry Ford, John D. Rockefeller, and Andrew Carnegie in its US Business Hall of Fame.
Steve Jr., a trained engineer with a master’s in business administration from Stanford, was indoctrinated in the family business since his childhood visits to the Hoover Dam worksite and his teen years at the Bechtel-McCone shipyards. But his strong will, self-discipline, and pride precluded him from assuming the position as a birthright. He took his father’s offer under advisement for a few weeks before accepting, with conditions. “If you want me to take over, I will,” he told his dad. “But I’ll have to do it my way. When I take over, I’m the boss.” Steve Sr. agreed. As a welcoming gi
ft, he asked his longtime advisor, “Uncle John” Simpson, to articulate to Steve Jr. how the company had been so successful and to suggest a path to continued profits.
With Simpson’s report in hand, Steve Jr. “began working on a major overhaul of the company” for a changed world and a new generation, according to the Bechtel website. “Energy use, fed by growing economies everywhere, was on the rise, fueling strong demand for petroleum products, natural gas, and electric power. The need for production, processing, and transportation facilities was increasing. New projects were getting bigger and more venturesome. This was also the golden age of spaceflight; anything was possible.” In Texas, Bechtel built the largest petrochemical plant in the world, and in Puerto Rico, the world’s largest chemical plant. In San Francisco, its Bay Area Rapid Transit (BART) system was the first totally new rapid transit system built in the United States in forty years.
Steve Jr. extended the Middle East projects, cultivating relationships with some of the world’s more unsavory figures, including Mu’ammar al-Qaddafi of Libya, the Shah of Iran, and eventually Saddam Hussein of Iraq. At the height of the company’s Arab exploits, Bechtel also branched out into mining in South Africa and South America, nuclear plants in Spain and India, pipelines in Canada and Alaska. For the next decades of the company, Steve Jr. also sought to dominate the resources in the American West, such as coal, uranium, oil, and gas.
Continuing his father’s and grandfather’s inveterate antilabor stance, Steve Jr. joined fellow business tycoons in a 1966 “hush-hush” meeting with Mexican counterparts to discuss how to fend off that country’s labor demands and keep Mexico’s “alleged socialist” government from interfering with their profits. “With all the secrecy of a military operation, 26 top-drawer American business executives slipped below the border” to Cuernavaca, shelling out “ ‘gratuities’ to Mexican aviation officials to omit registration of the private planes in which most of the U.S. contingent arrived,” wrote columnist Anderson. The four-day meeting at the swanky La Posada Jacarandas was so secret that the entire resort was closed to other guests. Bankrolled by the National Industrial Conference Board—an antiunion organization run by the chairman of U.S. Steel—discussion at the meeting “would have made the uninformed believe that Mexico was about to follow Cuba into the Soviet orbit.”
