The Glory and the Dream: A Narrative History of America, 1932-1972

by Manchester, William

  How had it happened? All his life Adams had been, as his eighty-two-year-old father put it, “sound as a dollar and square as a brick.” His wife Rachel fondly called him “the Great Stone Face.” In the White House he scrupulously paid for office stamps he put on personal letters and insisted that he be billed for personal phone calls. Until recently he had still used stationery headed “Sherman Adams, Governor of New Hampshire,” with “ex-” typed in. He was always at his desk by 7:30 in the morning—that had been true in New Hampshire, too, where he had been known to wade through blizzards to get to work on time—and any member of the staff who came in after the office had opened would hear his sharp call: “You’re late to work this morning!” In using the telephone he refused to waste valuable time saying “Hello” or “Good-bye.” He began talking the instant the other person picked up the receiver, and when he had said his piece he promptly hung up, cutting off the other fellow in mid-sentence. No man had ever been more trusted by a President. He checked out every piece of paper, every visitor, and every decision headed for Eisenhower’s desk, giving Ike clear options for choice, as in a short list of men eligible for a cabinet post. “Whatever I have to do,” the President had told a press conference, “he has in some measure to do.” Adams had never betrayed that enormous trust. How, then, had he wound up in the sticky embrace of a man like Bernard Goldfine?

  Much of the answer lies in the fact that there were two Bernard Goldfines. One of them was a cheap, devious manipulator, always in and out of trouble with the government and capable of exploiting any relationship. That was the Goldfine who had attracted the interest of the House committee. But Adams had never met that man. The Goldfine he had known ever since the war was a self-made, humble, eager-to-please immigrant, a diamond in the rough eager to use his wealth in good causes. In Adams’s words he was “an upright and honest citizen, trustworthy and reliable.” The suggestion that he would stoop to underhanded practices was absurd. He didn’t need to be underhanded; he was already rich. The Goldfine empire consisted of six textile mills in Maine, Vermont, New Hampshire, and Massachusetts and two real estate firms, East Boston Company and the Boston Port Development Company. Each year he gave $50,000 to charities. He, his wife, and his four children lived in a fashionable home in Boston’s Chestnut Hill suburb.

  Adams had been introduced to him by Norris Cotton, U.S. Senator from New Hampshire, as a public-spirited millionaire who refused to follow other textile manufacturers in the exodus south to cheap southern labor and taxes. Adams made inquiries and found that Goldfine was known to be a sound businessman with a good reputation in his trade; he treated his employees well, paid good wages, and had never been in trouble with the textile union. Once he had held a good-will conference between representatives of labor and management. It had been attended by the governors of Maine, New Hampshire, Vermont, and Massachusetts. His friends and admirers included Cotton, Senator Frederick Payne of Maine, Speaker of the House John McCormack, Mayor John Hynes of Boston, and John Steelman and Maurice Tobin of the Truman administration.

  The congressional investigation of Goldfine’s manipulations revealed that some of these friendships had seamy sides. He owned the house in which Cotton lived, and he had made Payne’s purchase of a home possible by lending him $3,500 for a down payment without interest, which had never been repaid. His relationship with Fox had begun when he had taken the extraordinary step of extending $400,000 credit to the Post in exchange for an editorial endorsement of Massachusetts Governor Paul A. Dever’s campaign for reelection. Recently the Goldfine-Fox friendship had soured, which may account for the incriminating passages in Fox’s testimony.

  Goldfine and Adams had become and remained steadfast friends. Rachel Adams and Charlotte Goldfine were also close to one another. The four of them often spent weekends together—in his memoirs Adams describes Goldfine as “a man with a lot of good fun in him”—and when young Solomon Goldfine almost failed at Dartmouth, “Uncle Sherm” sternly lectured him and put him on the right track. In this context the gifts become more understandable. They went both ways; the Goldfines had an oil painting from Rachel, and Goldfine wore a gold Le Coultre wristwatch inscribed “To B.G. from S.A. Jan. 20, 1953.” Adams was startled to learn that Goldfine had deducted the hotel bills on his tax returns. He had been under the impression that the suites were rented permanently by one of Goldfine’s companies and would have been empty if Adams hadn’t used them. As for the favors he had done for Goldfine, they weren’t at all improper, he said. He hadn’t guided him. Nor had he known that he had violated an FTC rule by making information available to his friend. In any event, that had been the extent of the accommodation. He would have done the same for any businessman bewildered by Washington bureaucracies.

  White House correspondents hammered at Hagerty: “Does this indicate a departure from the administration’s previous attitude toward freeloading by high officials?” He ducked: “I don’t know what you mean by that…. This is a personal friend, if that’s what you’re talking about.” They relentlessly pursued him: “It’s all right for a personal friend?” He dodged again: “I stick with the letter that the governor issued. The facts are as they are.”

  The presidential assistant’s failure to grasp the interpretation which others might put on his relationship with Goldfine stemmed in part from an inability to see himself as others might see him. Adams knew Adams to be honest; that was that. So was his friend; it couldn’t be otherwise. Those close to the former governor believed that he had been flattered by the admiration of the Lithuanian immigrant who had followed the Horatio Alger course to the top. Adams’s bedrock New England upbringing prevented him from being free with his own money, but he could not resist the lavish attentions of an openhanded big spender. Thus he had drifted thoughtlessly across a line.

  ***

  Testifying before the subcommittee on June 7, a full week after the disclosure of his relationship with Goldfine, Adams acknowledged that he had been “imprudent.” He said, “If… I have in any way so conducted myself as to cast any semblance of doubt upon such conduct, I can only say that the error was one of judgment and certainly not of intent.” The question was whether that concession from him was adequate now. He had made it only after he had found that it was not enough to sit behind the White House gates and issue a statement attacking the “unwarranted and unfair insinuations” of his accusers. Newspaper editors, vigilant as always on the issue of morality in public servants, were reminding their readers that on May 4, 1956, President Eisenhower had said:

  If anyone ever comes to any part of this government… claiming some privilege… on the basis that he is part of my family or of my friends, that he has any connection with the White House, he is to be thrown out instantly…. I can’t believe that anybody on my staff would ever be guilty of an indiscretion. But if ever anything came to my attention of that kind, any part of this government, that individual would be gone.

  Now, two years and fifty-five days later, Eisenhower faced 257 reporters in the Indian Treaty Room and doggedly declared that “Anyone who knows Sherman Adams has never had any doubt of his personal integrity and honesty. No one has believed that he could be bought.” Adams had been accused of imprudence, and he had used that word himself. Ike said, “Now, the utmost prudence must necessarily be used by everyone attached to the White House…. Carelessness must be avoided.” But a valuable presidential aide should not be lost because he had skidded once, especially in these circumstances:

  I personally like Governor Adams. I admire his abilities. I respect him because of his personal and official integrity. I need him.

  Admitting the lack of that careful prudence in this incident… I believe with my whole heart that he is an invaluable public servant doing a difficult job efficiently, honestly, and tirelessly.

  Ike had gone over the statement with Hagerty, who had approved it, believing that it would take the pressure off Adams. Only afterward did the presidential press secretary see the three dama
ging words leap from the pages: I need him. In a stroke the President had allowed his critics to depict him as a weak old man who could not govern without the help of an indispensable man and had permitted an exception to the White House rule that anyone on his staff involved in improper conduct should be fired.

  The President, then, had gone bail for Adams’s faith in his friend and benefactor Bernard Goldfine. Much would now depend upon the manner of the man with whom he had been imprudent. That came next and it destroyed Adams. The ensuing sessions on Capitol Hill turned into a burlesque. It began when Goldfine strode into the hearing room of the House subcommittee brandishing a twenty-five-page introductory statement. He had already angered the committee by releasing the text to the press at 7 A.M., three hours before he was scheduled to testify. Unperturbed and jaunty in a dark blue suit, wearing a blue silk tie initialed BG, he took the chair to read it. Then he removed his gold watch and passed it to the committeemen (“providing I get it back”), explaining, “The watch I am wearing now, on the back of it is written ‘to B.G.’—that means Bernard Goldfine—‘from S.A.’—that’s Governor Sherman Adams—dated ‘Jan. 20, 1953,’ and we all know that date. That is the inauguration date President Eisenhower was inaugurated.” In the visitors’ section Rachel Adams winced. She had just realized that that was how their friend had been introducing himself to strangers, including federal officials, all these years.

  In the spectacle that followed, the star millionaire was assisted by a worshipful secretary named Mildred Paperman; an entourage of lawyers headed by Roger Robb, who had been the heavy-handed cross-examiner of J. Robert Oppenheimer; Tex McCrary, a Manhattan press agent; and a press headquarters in Washington’s Sheraton-Carlton Hotel featuring caviar, free whiskey, and “Press Receptionist” Bea Duprey, a Boston Venus whose most conspicuous activity was urging reporters to get her measurements (35–22–35) right. There was also a New York flack named Jack Lotto, who identified himself as “a former ace reporter for INS” and who, in his press releases, spelled his client’s name “Bernard Goldfein.” Late one night Lotto caught two spies bugging the office from the next room. One of them was a private detective, Baron (name, not title) Ignatius Sacklette, who had been working for the subcommittee. He was instantly dismissed. The other was Drew Pearson’s legman, Jack Anderson. Pearson refused to fire Anderson. He said, “I need him.”

  On the first page of Goldfine’s opening statement McCrary had printed in block letters the message: YOU WILL BE GREAT! In reality Goldfine was awful. McCrary had also underlined words to be emphasized. Instead of stressing them, Goldfine yelled them. Periodically McCrary had written “Glass of water.” Unfortunately he had neglected to check out the committee room. There were no glasses there, only floppy paper cups, with the result that from time to time his client peered around in confusion. But neither McCrary nor any of the others was responsible for the devastating impression Goldfine made. He appeared to be a sleazy, amoral, double-shuffle con man because he was, in fact, a sleazy, amoral, double-shuffle con man.

  His voice rasping and his tone belligerent, he told how he had clawed his way upward in New England’s savage textile and real estate world. It was a world of which Eisenhower and Adams knew little. Whenever they thought of a businessman they thought of George Humphrey. Goldfine was of a different breed. Waving the watch and calling Fox a character assassin, he backpedaled frantically when committee counsel questioned him about his troubles with federal regulatory agencies. No, he had no records; “Paperwork has been out of my line.” Ask his secretary; “After all, I’m not a bookkeeper. She is.” Loyal Miss Paperman, seated a few feet away, piped up at this point in an attempt to explain why there were no records, and Robb snarled, “Keep quiet, keep quiet, keep quiet!” Begging the congressmen for understanding, Goldfine explained that Adams had merely given him directions to “these giant federal agencies where a little man gets lost without some kind of guidance from a friend.”

  At this juncture the subcommittee trapped him in a lie. In his opening statement he had flatly said, “The first difficulty that any of my mills ever had with the Federal Trade Commission was in November… 1953. Neither I nor anyone else in our companies had had prior experience with the FTC in matters of this type.” His point, essential to his case and Adams’s plausibility, was that when the FTC charged him with mislabeling in November 1953 he was so mystified that he needed Sherman Adams to explain what it was all about. Now subcommittee investigators produced proof that Goldfine had been inundated in 1942 and every year thereafter with FTC complaints accusing him of using labels that made his products appear to be of a higher quality than they were. At the hearing he answered weakly that this was just more paperwork and, besides, that they were “minor matters” and therefore not likely to get to his level. The congressmen didn’t challenge him. They knew what else was coming.

  Among the topics that Goldfine and Paperman were keeping quiet about, on the ground that they had no files, was a sum of $776,879.16, all of it in treasurer’s checks and cashier’s checks dating back to 1941 and, as of May 8, 1958, still uncashed. People in shady enterprises like money that way because, among other things, such checks have no time limit. Also, the name of a bank official, not that of the person footing the bill, appears on them. Finally, public officials fearful of cashing them because of the possibility of scandal may put them up as prime collateral for loans.

  Goldfine refused to answer questions about his treasurer’s and cashier’s checks, saying that they were irrelevant. The committee counsel countered that they could hardly be called that, inasmuch as thirty of those which had been cashed had been given to legislative aides on Capitol Hill. The names of men close to John McCormack and Styles Bridges entered the transcript. Goldfine replied: “At Christmas time these are all checks that we have sent at different times to some of the poor workers who work in different offices at Christmas time. If that is something that is bad, I would like to be told about it.”

  He was told that it was bad to ease in and out of firms through dummy organizations and straw men, bad to match loans, bad to disregard federal and state regulations designed to protect the public, bad to subsidize a pack of big and little politicians who thus became indebted to him, and bad to build an incredible record of litigation, including 89 lawsuits in the Boston area alone. It was bad, and it was also criminal, to plunder his own companies, thereby defrauding fellow shareholders, and there had been a lot of that.

  As the hearings progressed, Goldfine played more and more to the gallery, blustering and shouting his answers. He tried to argue that his infractions of the law had been insignificant, that he was the victim of legalisms—neglecting to file an annual report with the Vermont secretary of state, in one instance, and failure to take up his legal responsibilities as a company officer in others. As in most cases of financial skulduggery, the path of guilt was sometimes hard to follow, but plenty of Goldfine swindles were easy to understand. Operating through his secretary, who held key posts as treasurer and director in his firms, he repeatedly helped himself to generous sums of stockholder money. The pretenses for taking it varied. It would be called a loan, a sales commission, or repayment for nonexistent expenses ($25,475 in the case of a local firm dealing in real estate). Sometimes there was no excuse at all. The cash just disappeared. Neither he nor Miss Paperman could account for some $89,000 taken out in the late 1940s. She blandly suggested that the bank had “made mistakes in the past, and these can be an error.” It was hard to pin down exchanges because she and her employer were dealing every day with hundreds of thousands of dollars in liquid assets. In one respect ominous for Goldfine, however, the particulars didn’t matter. Whatever had happened, he clearly owed the government far more than he had claimed on his tax returns.2

  Afterward Adams wrote of his relationship with Goldfine that “I knew little or nothing about the details of his business dealings. I did not learn of his tax arrears until some of the facts began to unravel as a result of the hearings by
the Legislative Oversight Committee; nor did I know about his troubles with his East Boston Company’s financial operations.” No one, of course, had suggested that he had. The question was one of judgment. The unavoidable conclusion was that Eisenhower’s chief of staff had been gulled and the office of the Presidency demeaned. He would have to step down. It was both a public and a private tragedy. Adams had brought a rare talent to the White House, and one wonders how he could have fashioned an enduring social relationship with a cheat. Goldfine’s indifference to the implications of his conduct is astonishing. Even after Adams had set up his appointment with the chairman of the FTC, he let matters drift until three of his firms had been slapped with “cease and desist” orders for label violations. His concept of friendship appears to have been a lopsided swap. In return for a rug, a coat, and payment of some $3,000 in hotel bills, he had compromised Adams’s honor. A friend said of Goldfine, “He’s a name dropper and a Scotch drinker, and he had a weakness of talking too much, dropping too many names and things.” Now he had set in motion a chain of events which could only end in the dropping of Adams’s name from the White House roster.

  ***

  It didn’t happen at once. Ike’s executive officer was too valuable; he wouldn’t give him up without a struggle. Another member of the White House staff explained, “Adams has been with the President since 1952, and he knows how he thinks better than any other man. He has talked with the President about policy more than any other man. The governor has got tucked away in his head all the policy decisions the President has ever made, all the policy questions that have been laid aside for the right time, all the questions that have been rejected. It would be impossible for any new man to operate like Adams operates. And the new man could never accumulate the knowledge that Adams has.”