The Three Barons

by J. W Lateer

  The State Dept. Security Case of John Stewart

  Service

  Following on the heels of the Ladejinsky case, came the case against a man named John Stewart Service. This case was purely an example of the “let’s kill the messenger” point of view. As we shall see, the supporters of John Stewart Service could truthfully point to him as a perfect example of a dedicated, life-long State Department employee. But it was exactly this type of person who was being hounded out of government for the political advantage of persons like Senator Joe McCarthy.

  John Service was born in the Sichuan province of China, the son of Protestant missionaries. Later, he attended high school in Berkely, California and graduated from Oberlin College in Ohio. Starting in 1933 he served as a clerk in the American consulate in the capital of Yunnan province. He got several promotions. As time progressed, Service was eventually promoted to Second Secretary at the U.S.Embassy in China.

  Service had spoken very critically against Chiang Kai-shek and his Kuomintang forces. Because of his knowledge of China, he was sent on a fact-finding mission to scout the Chinese Communists under Mao Tse-tung. He met with Mao and Zho Enlai, the Secretary of State under Mao. In his reports about the Chinese Communists, Service praised the Communists as “democratic.” He continued to criticize in writing the Nationalists and Chiang Kai-shek as “corrupt and incompetent.”

  Service along with others believed that Mao would triumph in the struggle against Chiang. They suggested that Chiang could join with the communists to form a coalition government. Most Americans have no idea how close China came to getting this coalition government, due mostly to the personal involvement of General George C. Marshall. The reader should know that colonial imperialist governments like those of Britain and France were interested in playing one side in China against the other as they always did in colonial-type situations. Diplomats of this stripe felt that, in hindsight, such a policy and especially a coalition government in China would have avoided not only the Korean War but also the Vietnam War.

  The new U.S. Ambassador to China, Patrick Hurley, tried for unity in China but he failed. Hurley eventually came to support Chiang’s view exclusively.

  A faction in the U.S. called the “China Lobby” was started, some of whom were former Protestant missionaries in China (like John Birch of the John Birch Society).

  The members of the China Lobby lived in a kind of dream world. In the 1950’s and1960’s these people demanded that the U.S.“turn Chiang Kai-shek loose on the Communists.” They were pretending that Chiang, who was exiled in Taiwan, could simply walk in and destroy the Communists who had just defeated him with very little problem.

  It was against this background that John Stewart Service returned to Washington in 1945. He was soon arrested as a suspect in the Amerasia Case. Amerasia was an allegedly Communist foreign policy magazine. He was accused of passing confidential U.S. materials from his time in China to the editors of the Amerasia magazine. However, a grand jury declined to indict Service, finding that the materials were not sensitive or classified and were of a kind commonly released to journalists.

  Eventually, five years later, Service was dismissed from the State Department after Joe McCarthy accused him of being a Communist. Service challenged the dismissal in court. Ultimately, the U.S. Supreme Court ruled in his favor and he was reinstated. Service then had three more overseas assignments under MacArthur in Tokyo and in New Zealand up to 1949. But while back in Washington, he was wire-tapped and framed for an alleged security violation involving Amerasia magazine.

  FBI investigators broke into the offices of Amerasia and found hundreds of government documents, many labeled “secret,” “top secret,” or “confidential.” Service was arrested as a suspect regarding these documents. A grand jury refused to indict Service by a vote of 20-0. Service was subjected to loyalty and security hearings every year from 1946 to 1951 with the exception of 1948. In each hearing, he was cleared.

  In 1959, he was given a new security clearance. Loy Henderson, the Undersecretary of State for Administration approved the clearance. Henderson’s qualified approval allowed Service to continue his career. The State Department found a lesser position for him which did not require Senate confirmation. But for the rest if his career, despite excellent job reviews, the State Department refused ever again to promote him.

  We have examined the cases of Ladejinsky and Service to illustrate the nature of the war that was being waged nonstop from WWII right up to the JFK assassination and beyond between ultra-conservatives and the State Department.

  The State Dept. Security Case of John Paton

  Davies

  John Paton Davies, born in Sichuan, China and a graduate of the University of Wisconsin, Madison, joined the Foreign Service in 1931. He was a member of a fact-finding mission about Mao and the Communists in China called the “Dixie Mission.” The U.S. Government and specifically the State Department was wrestling with the question of the best policy by which to approach the major unresolved question of China.

  John Paton Davies went on to serve under U.S. General Stilwell, General Albert Wedemeyer and General Patrick Hurley: all three assignments were in China. After World War II, Davies served on the State Department policy staff as well as for the U.S. High Commission for Germany. John Paton Davies spent the whole time fighting the slander directed at him by the extremists in the China Lobby.

  Another whipping boy of the China lobby was an organization called the Institute of Pacific Relations. In his book The Anglo-American Establishment, author Carroll Quigley states that the case of John Paton Davies became intermixed with the case of the Institute of Pacific Relations. The Senate Internal Security Subcommittee had a virtual vendetta against the Institute of Pacific Relations. Author Quigley states that the Institute had roots with Wall Street and the British Commonwealth, among others groups. It was supported by the Wall Street investment bank of J.P. Morgan and other similar organizations and individuals. But there were allegations floating around that the IPR was dominated by Communists.

  The Senate Internal Security Subcommittee spent an entire year investigating the IPR. In 1952, McCarthy also began attacking the IPR. It is unclear when J.P.Morgan and the Rockefeller and Carnegie foundations withdrew their support and left the IPR or if they ever left at all. As of this writing, information about the IPR is still very hard to come by.

  It is in connection with the case of John Paton Davies of the State Department that Security Officer Otto Otepka came into this picture. It was claimed by his enemies that Davies had knowingly delivered papers to Communist agents in order to help assure the downfall of Chiang Kai-shek.

  Otto Otepka had ruled that Davies was not a security risk. The Davies case had gone before an independent Security Hearing Board at the State Department. That board voted 5-0 for Davies to be fired. Secretary of State John Foster Dulles, Ike’s appointee, relied on certain findings by Otepka to uphold the firing. After this controversy, John Paton Davies was in security limbo and was not eligible to be rehired by the State Department until January 1969, when he was hired as a consultant on disarmament.

  After the Davies case, the U.S. Foreign Service Corps developed hostility to Otto Otepka. Also, as a result of these controversial security issues at the State Department, a right-wing hatchet man named Scott McLeod was installed at State. He was a close ally of Otto Otepka and was subjected to severe criticism in some quarters.

  The Battle for State Dept. Security Under

  Ike

  On April 25, 1954, Otepka was promoted to Chief of the Division of Evaluations by Ike’s hatchet man Scott McLeod. In his work, Otepka emphasized linking any finding of security problems to the name of the individual who made the call with regard to the clearance. Otepka believed in accountability. If these decision-makers could merely pass into anonymity, Otepka believed that the framework of Internal Security would collapse like a house of cards.

  In defense of the objectivity of Otepka, it should be said t
hat he sometimes disagreed with his superiors in the Eisenhower Administration. Author Clark Mollenhoff, one of the best investigative reporters of his era, wrote critically about this security system at State. In his book DOD at p. 245, Mollenhoff pointed out that it is difficult to justify a system where a mid-level bureaucrat like Otto Otepka could, essentially, be the last and only chance to head off a major foreign policy and national security disaster. (See DOD p. 39) We will soon see how this flimsy system arguably led to disaster in the rise of Fidel Castro in Cuba.

  Mollenhoff suggests that Otepka was justified in many cases to bypass his superiors regarding security decisions. Otepka had multiple devious techniques to be able to “go around” his superiors at State. One way was to refer matters to the Personnel Department at State. Another more drastic method was to secretly inform the Senate Internal Security Subcommittee. It was Otepka’s tactic of approaching the Senate Internal Security Subcommittee where he ran into a hornets nest. And this is what connected Otepka to the JFK assassination.

  Because of conflict with Congress, President Truman had issued Executive Order 9835. This well-known order prohibited a Federal employee from providing classified information to any Congressional Committee. Part of Truman’s rationale for this was that: because of its diverse and loose structure, the Congress could not keep sensitive information secret. Further, Truman felt that it was he and not the Congress who was accountable for the actions of the employees in the executive branch. According to this belief, he felt that Congress would mostly be an interference in carrying out foreign policy.

  However, following the election victory in 1952, the Eisenhower Administration moved in the opposite direction. With Executive Order 10450, Ike made things tougher on alleged violators of security. Order 10450 abolished the existing distinction between “loyalty”and “security.”

  We now bring in Otepka biographer William J. Gill and his opinions regarding controversy surrounding Otto Otepka. In The Ordeal of Otto Otepka, the viewpoint of author Gill represents the attitude of the Taft-Eisenhower-Dulles conservatives of the 1950’s. This is true with regard to the crucial issue of U.S. foreign policy in general and the State Department in particular.

  In a duplicitous manner, Gill faults the FBI, the CIA and other intelligence agencies because in the 1950’s they drew a distinction between a Communist and a Socialist. Gill agrees on one hand that they should make that distinction. But in the very next sentence he says that Socialism is international in nature and that the Soviets always prefer to recruit espionage agents from among the Socialists. Gill seems to imply here that he would be perfectly okay if the U.S. Government fired Socialists because of their political beliefs.

  The case of Otto Otepka and his risky relations with the SISS committee is crucial to understanding the assassination of JFK. The battle between State and SISS was the extreme front line of this battle and Otepka was the solitary soldier on watch that came under the most fire and was most exposed in this epic confrontation.

  This conflation of Socialism and Communism shows that Gill, in most respects an excellent journalist, nevertheless both insults and attempts to mislead the reader. Thus Gill, although generally an objective journalist, fails to resist the temptation to make such an equation between Socialism and Communism. Gill even goes so far as to suggest that a purely legal view of this loyalty-security controversy is fundamentally detrimental. Gill faults William Blackstone. Blackstone was the British jurist who penned the monumental Blackstone’s Commentaries. Blackstone is one of the cornerstones of English common law. And the Constitution states that the English Common Law will be the law of the United States. Gill is not impressed. Thus, he dismisses the entire English Common Law as being a hindrance in the battle against Communism and subversion.

  The Establishment of the Laws Against Communism in the

  McCarthy Era

  The Internal Security Act of 1950 provided for registration of Communists or Fascists who wished to overthrow the U.S. Government. It was to monitor the enforcement of that Act that the Senate created the Senate Internal Security Subcommittee, known both as SISS and as the McCarran Committee.

  Many, perhaps most departments of the Federal Government, had officers who were in charge of weeding out Communists, homosexuals, alcoholics and certain other types of people. It was felt back then that these people were considered dangerous, either because they were actually subversive or that they were exposed to the threat of blackmail because of their unpopular life-style. As far as it is known to this author, this concept of security was new on the scene in this era of the Red Scare. Of course you could cite the Palmer raids of 1919-1920. And before that, there were the Alien and Sedition Acts in 1798 under the second President, John Adams. But the McCarthy era security laws and practices were of a different source and genesis.

  The key to understanding these issues is to recognize that the Red Menace was not really a menace to the United States itself. Like the United Kingdom, France, West Germany, Scandinavia and other stable Western democracies, there was little risk of Communism taking over and establishing a Communist dictatorship of the type under Lenin or Stalin. Although the Communist Party was allowed to be on the ballot in the U.S. as late as the 1940’s, it never drew more than 100,000 votes out of, for example, the 24 million who voted in 1948.

  The Red Scare scenario came from the fear of Communism taking over in other countries. And these were the countries which happened to be poorer than average or were already under the thumb of an oppressive government. Whence came the fears of the Vatican regarding the threat of Communism in Italy, Spain and Latin America. And there was the fracas over the loss of China to the Communists. There was also vulnerability in countries like the Philippines, Vietnam, Laos, Cambodia, Indonesia, Africa and the remnants of the British Empire.

  And so after WWII, the struggle began for control of the foreign policy of the United States. This struggle led directly to the assassination of President Kennedy. Related to this were the fluid, developing twin concepts of “security” and “loyalty” which were at work in the day-to-day job of the State Department Security Analyst Otto Otepka.

  To shine a light on the amorphous concept of Otepka’s definition of security, we can cite the following statistics. The SY (State Department Security), in reviewing the files of 10,000 employees,had made a list that numbered 1,943 persons, all of whom had “some form of derogatory information” in their files. As previously stated, this included suspected Communists, homosexuals and alcoholics, to name a few of the suspect traits and categories. Otepka boiled this list down to 858 of his fellow employees who deserved future monitoring.

  Otepka was considered to have an attitude which represented Eisenhower. Upon the election of John F. Kennedy, things drastically changed. Following the 1960 election, Otepka was confronted in December 1960, during a private meeting by Robert F. Kennedy and the new Secretary of State, Dean Rusk. To Otepka, this meeting was hostile and ugly and posed a threat to his ability to to do his job as it had been done under Eisenhower.

  Otepka worried most about the attitude of Robert Kennedy. In discussing the desire on the part of Robert Kennedy to obtain a security clearance for future Presidential Advisor Walter W. Rostow to work in the State Department if that became necessary, Otepka stated that such a clearance would not be granted. His main reason being that Air Force intelligence had in the past refused Rostow a security clearance and also that Rostow’s family had a Russian connection. In this tense meeting, the impulsive RFK would summarily dismiss the Air Force intelligence men as “jerks.”

  But when it came to the controversy which swirled around the lonely soldier Otto Otepka, there was more, much more to the story.

  Otepka Investigates

  Lee Harvey Oswald

  As portrayed in her book A Farwell To Justice: Jim Garrison, JFK’s Assassination, and the Case That Should have Changed History (FTJ), author Joan Mellen was the last JFK assassination researcher to interview Otto Otepka. Ms. Melle
n discovered that as of June 30, 1960, during the Eisenhower Administration, the Office of Security of the U.S. State Department began to investigate a list of supposed defectors to the Soviet Union and on that list was the name of Lee Harvey Oswald. Also involved in this investigation was the Office of Intelligence Resources and Collection, Bureau of Intelligence Research of the State Department.

  On December 5, 1960 Otto Otepka was informed by the Intelligence Collection and Distribution Division of the State Department that his department, the Office of Security, would handle the investigation of persons on that list of defectors who were potential intelligence agents. The job of Otepka was normally not to investigate just anyone, but rather State Department employees. Were these defectors nominal State Department employees? Could they be spies attached to embassies in the same way that CIA spies sometimes masqueraded as attachés at U.S. Embassies? We know for certain that Otepka was (for some reason) investigating Lee Harvey Oswald at a very early date, long before the name Oswald was to become one of the most famous in American history.

  The reader might ask, why did the State Department have a Bureau of Intelligence Research? It’s not as if the U.S. Government had a shortage of agencies examining intelligence issues. The FBI, the CIA, the NSA, Army Intelligence, Naval Intelligence and even the Police Departments in major cities were all heavily involved in intelligence. So why the State Department, too? Author Mellen states that Otepka’s mission was to determine if persons on this defector list had any connection to State Department employees.

  Of course, the State Department had a passport office. It would probably have some interest in persons who might be involved with foreign governments. But it is not clear why the State Department would undertake to monitor the activities of persons like Oswald who might be spies. That would seem to be the duty of the FBI, the CIA or military intelligence. And we know that after he returned to the U.S. from the Soviet Union, both Oswald and his wife were followed by FBI agent James Hosty.