Poisoning The Press

by Mark Feldstein

  Donald didn’t see it that way. “I’m gonna sue the bastards,” he vowed. “They keep writing about the Hughes loan [so] I’m gonna sue them.”

  “Don, you’re not gonna sue anybody,” Ehrlichman lectured the President’s brother. “You’re gonna keep your head down and lie low.”

  The strategy worked. In February 1972, newspapers around the country published Anderson’s article about President Nixon’s “irrepressible brother” and his “weakness for fattening foods and easy money.” After yet another reprisal of Don’s 1960 financial scandal with Hughes, Anderson wrote that Nixon’s brother had once again “incorporated himself and [begun] selling shares to citizens who might have an interest in his blood line.” But the columnist ended with an unexpected conclusion: this time, the President was determined to keep his brother “out of hot water” and prevent “any new embarrassments” by making sure that Don “avoid deals that might reflect unfavorably” on the White House. “I want to be sure that Don has no dealings with the federal government” and “is never asked to do anything that would embarrass this office,” the Chief Executive was quoted as saying.

  The White House was pleasantly surprised to find itself vindicated by its journalistic enemy. Marriott’s personal connection to Anderson seemed to have made the difference after all. For once, Richard Nixon was portrayed in the “Merry-Go-Round” as the victim rather than the villain.

  Jack Anderson’s uncharacteristic empathy for President Nixon’s brotherly difficulties was rooted in one of the most painful and little-known parts of the columnist’s life: his own problems with an envious younger sibling who also tried to capitalize on his older brother’s influence and celebrity. Gordon Anderson was seven years younger than Jack, the baby of the family and the favorite of their volatile father, with whom Jack had so often clashed. In the early 1950s, the youngest Anderson son followed Jack to Washington and unsuccessfully tried to imitate his success by becoming a reporter. Jack suggested that Gordon try another, more suitable line of work, but Gordon resented what he regarded as his older brother’s patronizing advice. One night, Gordon called Jack on the phone, drunk and cursing. For the first time, Jack said, “I realized that this kid hates my guts.” It was the beginning of a fraternal feud that would last the rest of the brothers’ lives.

  Over the years, as Jack became more famous and feared, some of his targets put Gordon on their payrolls in the hope of neutralizing his brother’s exposés. Gordon actively solicited these offers by promising favorable treatment in the “Merry-Go-Round” in exchange. “Jack was very upset that Gordon was trying to use his name to make a buck, just like Donald Nixon,” Anderson’s legman Jack Mitchell recalled. “Jack feared that his enemies would use it to attack and destroy him.” Anderson resorted to warning employers that they would receive no investigative immunity by hiring his brother. In fact, he said, it was just the opposite: “Merry-Go-Round” coverage would become more critical just to demonstrate that Jack couldn’t be compromised. Gordon was inevitably fired when his bosses learned the unpleasant truth. He accused Jack of brotherly betrayal.

  Gordon turned into the black sheep of the Anderson family, a thrice-divorced gambler and alcoholic who was jailed for vagrancy, stole money from his parents, and became estranged from his children. At one point, the FBI investigated Gordon for extortion after he allegedly made “threatening telephone calls” to a boss “indicating he would be written up in the newspaper” in his brother’s syndicated column. Eventually, Gordon grew so jealous of Jack that he threatened to hire a hit man to assassinate him and openly talked of kidnapping and killing Jack’s children and grandchildren. When the columnist visited Utah, where Gordon had returned to live, police had to provide armed protection. Jack called his hateful relationship with his brother “the saddest part of my life.” It was one of the few subjects that could reduce the hardened newsman to tears.

  Although Jack Anderson had sympathy for the President’s brotherly woes, the columnist remained distrustful as ever of Nixon’s relationship with Howard Hughes. After “a flurry of Administration favors” for the billionaire, Anderson wrote in an unpublished manuscript, “I had established to my own satisfaction, though not yet to my lawyer’s,” that the President was once again “on the take” from Hughes. To try to get more information, the newsman published what he later admitted were “puff items for the column that praised Hughes,” designed “to keep the channels greased” so that Anderson could acquire more important and incriminating information about the President himself.

  Sure enough, the reporter soon learned the identity of Nixon’s secret “personal emissary” to Hughes: Charles G. “Bebe” Rebozo, the President’s best friend, a taciturn Florida banker who had been a Nixon confidant for more than two decades. Anderson was excited by this discovery because he recognized that Rebozo—“known for his closed mouth and his handling of . . . private matters for Nixon”—was “just the man to handle money, personal money, money that no one would ever find out about.” To the muckraker schooled in the corrupt ways of Washington, the President’s best friend had obviously been designated as Nixon’s bagman to collect cash from Hughes.

  In August 1971, Anderson revealed that Hughes had “siphoned off” $100,000 from his Silver Slipper casino in Las Vegas and had the cash delivered to the President through his “close crony” Rebozo. Although the Hughes gambling money was supposedly intended “for Nixon’s campaign,” Anderson wrote, none of it was spent for political purposes or disclosed in public records as required by law. “Everyone called it a ‘campaign contribution,’ but there was no campaign” when the money was delivered, a Hughes biographer later noted, “and Rebozo made it clear that the contribution should be delivered directly to him—in cash—rather than to any campaign committee.” The secret transaction, in other words, seemed to be evidence of a crime: at best an illegal campaign donation or untaxed gift, at worst an outright bribe.

  Anderson was amazed by Nixon’s brazen hypocrisy. By once again covertly taking funds from Hughes, the President was not only “doing what he wouldn’t tolerate his brother doing,” but also risking yet another financial scandal with the infamous billionaire. This would turn out to be the most important Nixonian slush fund ever, one whose path would ultimately lead to Watergate and resignation in disgrace.

  The Hughes cash, one thousand hundred-dollar bills, was stuffed into unmarked manila envelopes and hand-delivered to Rebozo. Nixon’s best friend counted the money, then marked the package with the initials HH—Howard Hughes—and locked it in a safety-deposit box in his bank. Despite the President’s busy schedule, he made time to visit with Hughes’s trusted courier right after the money was delivered.

  The fact that Anderson learned of Nixon’s clandestine payment from Hughes was stunning because both the President and the tycoon shared an obsession for secrecy that bordered on the pathological. But Anderson’s network of informants was extensive, his timing impeccable. A few months earlier, Hughes had fired the newsman’s longtime source Robert Maheu, who now wanted revenge on his former boss. Maheu would admit that the Nixon cash was indeed designed to “insure favorable treatment by the Administration” and that Hughes “decided to camouflage” the payments by funneling them through Rebozo. Anderson received additional confirmation from Maheu’s attorney, another veteran Anderson informant. In addition, Hughes’s sensitive handwritten notes were stored in the locked vault of yet another Anderson mole, who shared the incriminating paperwork with the reporter over dinner. “I am willing to go beyond all limitations on this,” Hughes wrote, because Nixon would “be deeply indebted” and “recognize his indebtedness.” Anderson now had tangible proof for his column.

  The revelation of the secret $100,000 Hughes payment would turn out to be Anderson’s most significant and far-reaching Nixon exposé ever. Yet, as with so many “Merry-Go-Round” stories, it initially landed with a thud. The muckraker’s column “appeared to receive little notice,” Senate investigator Sam Dash later rema
rked, “except at the White House.” At first, even Anderson didn’t fully appreciate the magnitude of his disclosure. After his one unnoticed column about it in the summer of 1971, he abandoned it for other subjects. Only five months later, when Hughes was back in the news, did the reporter revisit the topic; afraid of being scooped on his own story, Anderson fell back on a familiar tactic: recycling an earlier, unnoticed column by dressing it up with more sensational language to make it appear fresh.

  On January 24, 1972, Anderson reported that “we have documentary evidence” that Hughes delivered $100,000 to the President through Rebozo—cash that “was siphoned like a sip of champagne from the Silver Slipper, one of Hughes’ Las Vegas casinos,” as the columnist later put it. Nixon’s “cozy relationship” with Hughes, Anderson declared, “has revived our decade-old revelations about the $205,000 that he loaned to Nixon’s brother Don” and does not “make good political advertising in an election year.”

  This time, Anderson’s story produced immediate alarm in the White House, where Chief of Staff H. R. Haldeman closely guarded a file on Hughes that was marked “Top Secret—CONFIDENTIAL.” Hours after Anderson’s column was published, the President privately cursed “that goddamned Hughes thing.” The next day, John Ehrlichman asked the White House counsel, John Dean, to “very discreetly” look into the matter. The President’s men also tried to plug the leaks to Anderson. Rebozo phoned the courier who had delivered the manila envelopes filled with Hughes cash, only to discover in horror that the newsman not only knew the go-between’s identity but had already called him with a stern warning: “Don’t deny it, because I have seen the memo describing this in detail.”

  In subsequent columns, Anderson expanded his attack and suggested that the Hughes money was nothing less than an outright bribe. “The payments coincided closely with two government decisions favorable to Hughes,” the muckraker charged. “President Nixon approved the sale of Air West [airlines] to Hughes” and “the Justice Department reversed an antitrust action which had barred Hughes from expanding his hotel-casino empire in Las Vegas.” Anderson’s columns “aroused something approaching panic in the White House,” one author wrote, and presidential advisors carefully tracked Anderson’s investigation to “anticipate any new allegations which might be forthcoming.” The Hughes camp was equally concerned. Anderson has “hammered the $100,000 question to death,” an aide warned the billionaire, “and there is no sign of a let-up.”

  The President had special reason to worry. He and his family had already spent tens of thousands of dollars of the illicit money. Senate investigators later determined that Rebozo had paid at least $50,000 of the President’s private expenses with cash collected from Hughes and other wealthy patrons: more than $45,000 in improvements on Nixon’s two vacation homes, including a swimming pool, golf putting green, and billiard table; and another $5,000 for platinum earrings studded with eighteen pear-shaped diamonds, a birthday present for the First Lady from her husband. In addition, Rebozo confided that he also passed out wads of Hughes’s hundred-dollar bills as gifts to the President’s brothers and to Nixon’s faithful secretary, Rose Mary Woods.

  White House aides euphemistically referred to the President’s slush fund as the “tin box.” “There was much more money in Bebe’s ‘tin box’ than the Hughes $100,000,” which was “only part of a much larger cash kitty kept in [Rebozo’s] safety deposit box,” Haldeman later admitted. “Rebozo, in effect, maintained a private fund for Nixon to use as he wished.”

  Once again, it was Jack Anderson who exposed the latest Nixon slush fund. Eventually, the President’s men would use it to try to cover up their Watergate burglary. But before that happened, Anderson struck again.

  12

  “DESTROY THIS”

  Despite Jack Anderson’s pounding attacks, by early 1972 Richard Nixon appeared on his way to a second term in the White House. Indeed, with historic summits scheduled in Peking and Moscow, the President seemed destined to overwhelm his divided Democratic opponents in the upcoming November election. Nixon, however, took nothing for granted. “Remember 1960,” he warned intimates. “I never want to be outspent again.” He would not be. His Committee to Re-elect the President—known by its eerily apt acronym CREEP—raised a staggering $60 million, the largest amount of money that had ever been spent in a political campaign.

  Awash in cash, CREEP’s full-time squad of “pickup men” who traveled across the country collecting donations were so overwhelmed by the torrent that they were physically unable to gather all the contributions offered. The cash was delivered in envelopes, sacks, and suitcases, and often laundered to hide fund-raising illegalities. Contributors ranged from shady entrepreneurs like Howard Hughes and Robert Vesco to foreign dictators from Iran, Greece, Nicaragua, and the Philippines. Right-wing businessmen such as Richard Mellon Scaife and H. Ross Perot gave large sums to CREEP; so did corporate titans who ran America’s Fortune 500 companies. “Anybody who wants to be an ambassador must give at least $250,000,” the President told aides. Donations were motivated less by political ideology than business investment, a kind of commercial tithe to grease the machinery of government. Corporations reported brazen White House pressure to pony up for the Nixon “kitty.” Those that complied were rewarded; those that did not were punished. Subtlety was not allowed to interfere with success.

  One of the most generous donors to the Nixon campaign was the International Telephone and Telegraph Company (ITT), a telecommunications conglomerate whose fortunes were especially dependent on administration decision-making. Under the aggressive leadership of its chairman, Harold Geneen, ITT had become one of the biggest and most powerful multinationals in the world by swallowing up other corporations, including the Sheraton hotel chain, Avis Rent a Car, and various food, building, and parking operations. By 1971, in the largest proposed merger in American history, ITT sought to grow even greater by acquiring Hartford Fire Insurance, although the Justice Department’s antitrust division was fighting the move in court. Fortunately for ITT, the President himself personally tracked ITT’s business fortunes—and its potential to help his reelection campaign.

  “Does ITT have money?” White House chief of staff H. R. Haldeman asked Nixon during one discussion of the conglomerate’s antitrust problems.

  “Oh God, yes,” the President replied. “That’s part of this ball game.”

  Indeed, Nixon met privately with ITT’s chairman during a dinner aboard the presidential yacht, the Sequoia. Afterward, the President confided to Haldeman that he had overruled his antitrust prosecutors and secretly “cut a deal with ITT” to “give them Hartford, which they badly need . . . Now this is very, very hush-hush and it has to be engineered very delicately.” In return, ITT could be counted on to show its financial gratitude. “But it should be done later” to conceal the connection, Nixon ordered. “It should not be right now . . . Nothing done until the deal is over.”

  Haldeman obediently instructed the President’s reelection campaign to “hit Geneen hard” for cash once ITT’s takeover was complete. Given “how much benefit Geneen had reaped from the settlement,” said White House counsel John Dean, CREEP would not “hesitate to milk” the decision “for all it was worth.” Haldeman advised Nixon fund-raisers to “work through” Deputy Attorney General Richard Kleindienst, a former Nixon campaign operative, because, as Dean explained, “Kleindienst would be well acquainted with how much benefit Geneen had reaped from the settlement” and therefore how much money to demand in return.

  On May 1, 1971, the Nixon Justice Department began reversing its position so as to allow ITT to acquire Hartford Insurance. On the very same day, Geneen found a way to thank the President for his help: by having ITT donate up to $400,000 to underwrite the upcoming Republican convention, where Nixon would once again be nominated for the presidency by his party. Understandably, the White House and ITT tried to keep the company’s donation quiet, but the secret eventually leaked out and a few suspicious minds began raising questi
ons. By the fall, Democratic Party chairman Lawrence O’Brien wondered aloud whether there was any connection “between ITT’s sudden largesse to the Republican Party and the nearly simultaneous out-of-court settlement of one of the biggest merger cases in corporate history.” Two months later, Jack Anderson wrote pointedly in his column that “the aura of a possible scandal continues to hang over the transaction.” But neither the columnist nor the Democrats had any proof to back up their doubts. Anderson later acknowledged that his column was “more rumination than news,” written primarily as a “lure” to solicit information from any insiders who might have an urge to talk.

  In February 1972, Anderson’s lure reeled in a whale of a story—a secret memo from ITT’s chief political fixer in Washington explicitly stating that the conglomerate’s $400,000 pledge led the Nixon Justice Department to change its mind and approve the ITT takeover. In a “personal and confidential” note typed on ITT letterhead, lobbyist Dita Beard informed her boss that “our noble commitment” of $400,000 “has gone a long way toward our negotiations on the merger eventually coming out as [ITT chairman] Hal [Geneen] wants.” Beard added that Attorney General John Mitchell, Nixon’s past and future campaign manager, “is definitely helping us, but cannot let it be known . . . If it gets too much publicity, you can believe our negotiations with [the] Justice [Department] will wind up shot down . . . Please destroy this, huh?”

  The ITT memo “was the single most incriminating piece of paper I had ever seen,” marveled Anderson’s legman Brit Hume. The document appeared to offer proof of a corporate bribe, concrete evidence that was extraordinarily rare because such illegal quid pro quos were almost never put in writing. The fact that the memo was dated just four days after ITT secretly sent its check to the Republican Party—eight days after the Justice Department officially agreed to settle ITT’s antitrust case and weeks before either decision was announced publicly—seemed additional corroboration of a clandestine political payoff. “Emerging eight months before the election,” one author wrote, the memo “could hardly have been more inflammatory.” It was, Anderson said later, “the smoking gun—or, more accurately, a smoking memo, for it was a scorcher.”