The Patriarch

by David Nasaw

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  In January 1921, Kennedy’s new firm, the Robertson-Cole Distributing Corporation of New England, opened for business at 39 Church Street in Boston. Kennedy enlisted Honey Fitz, still Boston’s most accomplished promoter/performer, to help him promote his first film, a big-budget adaptation of Kismet starring Otis Skinner, opening at the Majestic. “There are countless ways you can suggest that we could get publicity, and all that means money in our pocket. . . . Your influence with the Boston newspapers would help us in getting a lot of things that we otherwise could not.”30

  Despite Kennedy’s promises and Honey Fitz’s promotions, the distribution deal he had offered Rufus Cole had done nothing to solve Cole’s cascading financial problems. In late March 1921, Cole was visited in New York by the company’s chief stockholders, Sir Erskine Crum and Sir Cecil Graham of Graham’s of London, and a representative of Cox and Co. Kennedy boarded a train for New York, where he pulled off the first act in what amounted to a brilliant but ethically dubious double cross by suggesting to Crum that he rid himself of Cole and his debts by selling the company. Sir Erskine was entranced by the young Boston banker, as Cole had been. He asked Kennedy to keep their negotiations confidential until a plan had been worked out that he could present to his London partners.31

  Kennedy broke Crum’s confidence the next day when he boasted to Eugene Thayer that he was “practically representing Cox’s Bank of London and the Grahams of London.” Here was his big chance to break into the picture business—and he was not going to forfeit it. “I remember that you have spoken to me several times,” he wrote Thayer, “about your interest in the Goldwyn Company. As you know, I have made a particular study of this motion picture business, with the idea that sooner or later the motion picture companies would need someone from the banking business who was familiar with the picture business. The time has now arrived . . . to my mind the only thing that can save all of the companies is consolidation of some kind.” The consolidation he had in mind was of the Goldwyn and Robertson-Cole interests. “Of course, the whole thing would have to be confidential as news flies in the picture business. . . . If, however, you think it of any value at all, let me know and I will come to New York and discuss it with you or the men who are financially interested.”32

  Kennedy played his cards well. He sought and received permission from Galen Stone to act as Sir Erskine Crum’s confidential adviser. On Kennedy’s recommendation, Crum wrote down Robertson-Cole’s outstanding debt, reorganized it as an American corporation, put Kennedy on the board of directors, and offered him an exclusive option to sell the company. He was to receive $1,500 a month for his efforts and a brokerage fee of $75,000 if he sold the business for $1.5 million or more.33

  As exclusive agent for Sir Erskine Crum and Graham’s of London, Kennedy was able to arrange meetings with every major financial player in the picture industry. He met with William Randolph Hearst of Cosmopolitan Productions, Joe Godsol of Goldwyn Pictures, James Hurd of Vitagraph, and later that year, W. W. Hodkinson, the former head of Paramount who operated his own distribution company. He proposed to each of them that they could cut costs and boost profits by merging with Robertson-Cole or, if that was not possible, consolidating their distribution networks.34

  The logic of his position was sound, but Robertson-Cole was too small and too burdened with debt to be worth “consolidating with.” In July 1921, with no offers forthcoming, Kennedy recommended—and the London bankers agreed—that instead of selling the company at a loss, they would hold on to it, make more pictures, and hope that finances would improve to the point where they could attract a buyer. Rufus Cole was removed as president, and Pat Powers, an experienced producer who had previously been Carl Laemmle’s partner at Universal, was hired to replace him. The company was renamed the Film Booking Offices of America, FBO for short.

  Powers and his second in command, Joe Schnitzer, invested a great deal of their own money in FBO and tried to get Kennedy to do the same. He declined. “Frankly, between you and me,” he wrote Schnitzer in the summer of 1922, “I am all through with putting money in the picture business. Everything I have touched up to date has been very disastrous, and the local exchange up to date still owes me money. In addition to that, I am altogether too familiar with the R-C [Robertson-Cole] situation to be willing—for the present at any rate—to put very much money in as an advance.”35

  He preferred, for the time being, at least, to focus his attention on distributing and exhibiting pictures, not making them. That spring, he tried to flatter his way into a business arrangement with Sidney Kent, who was in charge of distribution for Adolph Zukor’s Famous Players–Lasky Corporation. “Personally if I intend to spend any further time in this industry I would like very much to make some kind of a tie up with your organization, because I feel that at the end of a couple of years the industry will be almost entirely in your hands, and I think an unwillingness to tie up the situation here shows an absolutely lack of foresight and vision.”36

  No one knew how to play the angles as well as he did. Though still a relative newcomer to the business, with no ties to Hollywood or Broadway, Kennedy had figured out how to use his outsider status to his advantage. The movie business was going through another of its periodic censorship panics. The causes were several, as they always were. There were too many racy films with racy titles like Luring Lips, The Restless Sex, Short Skirt; too many Hollywood scandals like the one involving Fatty Arbuckle, accused of rape, molestation, and the murder of a young starlet; and too many local and state censorship boards—with more on the way—stirred up by accusations, sometimes explicit, more often implicit, that the industry was not to be trusted because it was controlled by unscrupulous, money-hungry, immoral Jews.

  For Kennedy, the crisis was a godsend because it gave him the opportunity to ride to the rescue as a white knight of sorts. True, he was not a midwestern Protestant Republican like Will Hays, the former postmaster general who had been hired to represent the industry as president of the Motion Picture Producers and Distributors of America at the outrageous annual salary of $150,000, but he was a Harvard graduate, a Boston businessman and banker, a family man, a practicing Christian, and decidedly not a New York City Jew.

  In 1922, censorship bills were introduced in thirty-two of the forty-eight states of the Union. The key battle was in Massachusetts, where a state referendum had been called for election day in November. Kennedy offered his services—and political connections—to Will Hays, who was coordinating the campaign against the referendum. “Everything passed off very satisfactorily in Springfield,” Kennedy wrote Hays after the Massachusetts State Democratic Convention had reaffirmed its commitment to the First Amendment. “From all indications,” he continued, “we will have little trouble here in Massachusetts.”37

  At the same time he was assuring Hays that there would be “little trouble” in Massachusetts, he was using the censorship threat to frighten Famous Players–Lasky into selling him, a native Bostonian and politically connected banker, the Paramount Theater in Lowell, Massachusetts. “As you know, in New England practically no political or banking influence is behind any phase of the picture industry. I have been trying to interest people of both banking and political influence in houses, in order that they may see that it is an industry that should be supported, and get all the help that it could.” Though his proposal to buy the Lowell theater was turned down, he was able to buy smaller theaters elsewhere. He purchased one in Stoneham, Massachusetts, for $15,000 and bought a 50 percent interest in the company that owned and operated two theaters in New Hampshire.38

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  Kennedy was now spending more evenings in Boston, where the theater district was still vibrant, thriving, and expansive, entertaining and being entertained by the actors, actresses, managers, theater owners, and aspiring picture producers he hoped to do business with. Rose sometimes accompanied him. “It was all,” she remembered a hal
f century later, “a completely new and different environment, gay, exciting and quite different and quite breath taking to me, who was a convent bred girl. I had heard that chorus girls were gay, but evil, and worst of all, husband snatchers. But nothing shocking happened. The people whom we met all seemed to have their own personal problems in which they were deeply involved, so we enjoyed the fun and excitement and novelty of the life in musical comedy. We even went to a skating party in the Boston Arena to celebrate the first birthday of [Fred Stone’s Jack O’Lantern] show, and we skated around quite naturally with all the lesser and greater luminaries of the stage.”

  More often, however, Rose stayed home with the children and the servants while her husband went out. She claimed, again in retrospect, that she had no problem with any of this. “One characteristic of my life with Joe was that we trusted one another implicitly. If he had occasion to go out with theatrical people, he told me he was going and he went. There was never any deceit on his part and there was never any doubt in my mind about his motives or behavior.” His socializing, she believed, was always in the interest of concluding one or another business deal. Still, she noted that Joe was becoming more and more attracted to “the life that revolved around Arthur Houghton” and to lots of show people he did not introduce her to.39

  One of his new acquaintances was Vera Murray, producer Charles Dillingham’s secretary, whom he had met through Arthur Houghton, Fred Stone’s manager. Learning that Murray would be in Boston with Dillingham on August 15, 1921, for the opening of a new comedy at the Colonial Theatre, Kennedy telephoned, then wrote to ask her for tickets and to invite her to dinner with him, Eddie Moore, and a third friend. “At this dinner at 7 o’clock you might state what is your pleasure for the balance of the evening and the three Boston youths will try, insofar as they can, to make things pleasant for you during your stay. . . . Not knowing what the functions are of the right-hand man [Vera was Dillingham’s chief assistant on the road] to the powers that be, I don’t know how close you will be obliged to stick to your boss tonight. I know how close you would have to if I were your boss.”40

  In a similarly jocular tone, he wrote Arthur Houghton, who was moving to Boston for the winter with Fred Stone and his latest show, Tip Top, that he hoped “all the good-looking girls in your company [were] looking forward, with anticipation, to meeting the high Irish of Boston, because I have a gang around me that must be fed on wild meat lately, they are so bad. As for me, I have too many troubles around me to bother with such things at the present time. Everything may be better, however, when you arrive.”41

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  The stock market, which had been in the doldrums since war’s end, in mid-1921 began the steady upward climb that would continue until late 1924, when the great bull market took off toward the stratosphere. Kennedy remained heavily invested in the stocks of companies controlled by Hayden, Stone. As they increased in value, so did the amount of money he could borrow, with those stocks as collateral. Every transaction was remarkably complicated. On August 16, 1921, to cite but one example, Kennedy sold one thousand shares of Eastern Steamship for $77,500, which he then used to pay off some bank debts and the money he had borrowed to purchase his Todd Shipbuilding stock. At the end of the day, he would owe $37,500 at Hayden, Stone and thousands elsewhere, but he now had nine hundred shares of Todd Shipbuilding free and clear, which could be used to collateralize additional loans and purchase more stock.42

  The juggling of his own accounts was enough to keep any ordinary investor occupied full-time, but Kennedy was also trading stocks, evaluating and overseeing investments, buying and selling real estate, and securing and monitoring mortgages and loans for friends, family, business associates at Columbia Trust, and influential investors like Matthew Brush, whom Kennedy had met when he was president of Boston Elevated and who had since moved to New York to become president of the American International Corporation, a large investment house. “I know of no pool operating in either stock,” Kennedy wrote Brush from Boston in response to a query about two stocks Kennedy had insider information on, “but I have no doubt at all but what both of them will sell much higher. Let me know if you take any on, so that I can keep you posted on development.” He was quite generous with advice and material assistance to those he considered his friends. Arthur Houghton got help in renting an apartment and in selling his mother’s house. When Eugene Thayer was “forced to take a vacation as a result of poor health,” Kennedy offered to lend him $50,000 to $75,000 on seventy-two hours’ notice, if needed. “I would consider it a great favor if you feel that this can be of any service to you whatsoever.”43

  His closest friends remained his Harvard classmates. Since graduating in 1912, he had kept in touch with several of them, including Bob Fisher, who had been named Harvard football coach. According to Rose, “he and Joe would talk by the hour about the different maneuvers which Bob would make with respect to the team and respect to his own plans, as several people wanted to oust him.”44

  In June 1922, Kennedy celebrated his tenth college reunion. Opening night was marked by a formal dinner at the Pilgrim Hotel outside Plymouth. The evening’s entertainment consisted of a series of speeches, hopefully humorous ones, but as Oscar Haussermann, one of the reunion organizers, recalled, “our abundant supply of good pre-Prohibition liquor was beginning to create confusion long before the coffee was served. To calm things down, Joe said to me, ‘Let’s call off the speaking, turn out the lights and show the movies.’ This we did. The movies, all furnished by Joe, consisted of a bathing scene from ‘Kismet’ and the Dempsey-Willard and Dempsey-Carpentier fight films. Viewing in the dark such films without any further alcoholic intake had a sobering effect on one and all. Joe both made and saved the day!”45

  It should have been but was not a “dry” celebration. The Eighteenth Amendment, ratified in January 1919, and the Volstead Act, passed over President Wilson’s veto in October, had together made illegal the manufacture, sale, barter, transport, import, export, delivery, furnishing, or possession of liquor. That didn’t matter much to the men of Harvard. In preparation for the reunion, the “entertainment committee” had purchased 180-proof alcohol. Kennedy, in his one and only venture into bootlegging, got in touch with a Mr. Dehan, who had legally “blended” liquor for P.J. in the days before Prohibition and “who really is one of the best men on this in this part of the country.” “The stuff,” Kennedy wrote Matt Brush after the event, “turned out very well indeed, and was perfectly satisfactory to all the fellows in the class who are, of course, used to the best—and the worst.” Kennedy offered Brush some of the leftover gin. “Twenty-five dollars is the actual cost of the stuff, and I would be very very happy to have you have it, if you think it would be satisfactory.”46

  Outside of his sale—at cost—of leftover Harvard reunion gin to Matthew Brush, Kennedy neither imported nor sold any liquor during his years in Brookline or at any time during Prohibition. His father had been an importer and part owner of several stores, and Kennedy had helped him move his unsold supplies to his cellar in Winthrop, reserving ten cases of very expensive French wine and the best champagnes for his own entertaining needs, but there was nothing illegal about any of this.47

  Not only is there no evidence of Kennedy’s being a bootlegger, but it flies in the face of everything we know about him. As an East Boston Irish Catholic outsider struggling to be allowed inside, he was willing to take financial risks, but not those associated with illegal activities such as bootlegging.

  The charge that Joseph P. Kennedy was a bootlegger appeared only once during Kennedy’s lifetime. In October 1960, the St. Louis Post-Dispatch reported that “in certain ultra-dry sections of the country,” Joseph Kennedy was being referred to as a “rich bootlegger” by those out to derail his son’s campaign for the presidency. Most of the stories about bootlegging originated in unsubstantiated, usually off-the-cuff remarks made in the 1970s and 1980s by Meyer Lansky, Frank Coste
llo, Joe Bonanno, and other Mob figures not particularly known for their truth telling. Their revelations provoked journalists, reporters, and amateur historians to seek out additional stories that were used to buttress conspiracy theories connecting John Fitzgerald Kennedy’s assassination to organized crime. “Eyewitness” accounts delivered decades after the events they purportedly described placed Kennedy at Sag Harbor, on the docks at Gloucester, at Cape Cod, and at Carson Beach in South Boston, unloading or supervising the unloading of liquor shipments from Nova Scotia or England or Ireland. Other stories linked Kennedy to Al Capone and an operation that brought liquor into the country from Canada through Lake Michigan. Evidence for this operation was supplied by a piano tuner who claimed that while tuning Capone’s piano, he overheard Kennedy and Capone striking their deal. Despite the stories, there is no evidence, no mention, not even a report, of any rumors of bootlegging in any of Kennedy’s FBI files or those that reference him. No allegations surfaced during his three confirmation hearings for SEC chairman, Maritime Commission chairman, and ambassador to Great Britain in the 1930s or in the four investigations conducted in the 1950s after he was recommended for presidential commissions.

  The only seemingly credible evidence that has ever been offered to tie Kennedy to illegal liquor trafficking is a 1931 Canadian Royal Commission on Customs and Excise investigation that references a Joseph Kennedy Ltd. as engaged in the illegal export of liquor from the province of British Columbia. The Joseph Kennedy of Joseph Kennedy Ltd. was not, however, Joseph P. Kennedy of Brookline, but Daniel Joseph Kennedy of 1119 Nelson Street, Vancouver.48

  With or without evidence, the rumors of Joseph Kennedy’s bootleggers remain part of his story. As Daniel Okrent, who spent years researching bootleggers and bootlegging and found no sign that Kennedy ever trafficked in liquor, reminds us, “One cannot prove a negative.”49