Blacklisted By History

by M. Stanton Evans

  CHAPTER 28

  Little Red Schoolhouse

  HAD McCarthy done nothing more during his uproarious heyday in the Senate, his role in blowing the lid off the Amerasia scandal would deserve the plaudits of a grateful nation. This not only because of the intrinsic meaning of the case, but because it was the gateway to still other unthinkable revelations from the darker precincts of the Cold War.

  And let there be no mistake that it was McCarthy who led the charge—constantly hammering on the case, digging up security data on Service, and otherwise exerting pressure on the Amerasia crowd and those complicit in its doings. Hoover and his agents knew the facts—knew far more than did McCarthy—but had to do their fighting behind the scenes, in a secret war of dueling memos. These inside baseball efforts weren’t enough to prevent the Tydings panel and Truman Justice from selling a bogus version of the story. It was McCarthy who would stir up the public wrath and outcry that would be needed if the security woes implicit in the case were to be exposed and proper remedies adopted.

  Nor was it simply a matter of Service-Jaffe and the documents that passed between them, or even the laundry list of federal crimes committed by the Amerasia fixers. The deeper meaning of the case stemmed from everything that lay behind it, and that would also need to be hauled out for public airing. In going after Service/Amerasia, McCarthy was tugging at the visible edges of an enormous network—far larger than he knew—that permeated the federal government and had objects more grandiose than the papers that made their way to Jaffe, important as those papers were.

  To grasp the full significance of the Amerasia case and the way it was handled pre-McCarthy, we have only to reflect a bit on some of the things that should have happened in 1945 but didn’t because the cover-up succeeded. Most obviously, Service and his codefendants weren’t correctly brought to book, but that was merely the beginning. Because the fix was in, there was no serious effort to track down the confederates of the Amerasia culprits threaded throughout the State Department, Treasury, White House, and other influential places, all diligently working to shape the course of Cold War history in Asia.

  Arguably the second-leading suspect in any adequate probe of Service would have been his Soviet agent housemate, Adler, and not far behind would have been Service’s other Soviet agent housemate, Chi Chao-ting. From its surveillance of Jaffe, the FBI knew of the Service-Adler tie-in, and from the Bentley probe that shortly followed would obtain her evidence, backed by that of Chambers, that Adler was part of a pro-Soviet combine on the Treasury payroll. Adler nonetheless somehow got past the Truman loyalty screeners, while the facts about his case—along with just about everything else relating to John Service—were buried. Chi Chao-ting, meanwhile, was given only passing notice by security types and would likewise avoid exposure.

  Had these two Soviet moles been rooted out in 1945, along with other of Service’s allies, the subsequent course of events in Asia might have been quite different. But because the fix was in and the lid was on, this formidable pair of Soviet agents would have further leisure for clandestine action in behalf of Yenan and Moscow. In the case of Adler, this meant another five years as a Treasury staffer, including close involvement in the Marshall mission of 1946, a pivotal episode in the fall of China. In the case of Chi, it meant continuing as a Maoist agent inside the KMT until it fell in 1949, at which point, mission completed, he would abscond to Beijing.

  Something else that should have happened in 1945 but didn’t was the unmasking of Lauchlin Currie, himself one of the major fixers and a confidant of Service. Based on the Bentley revelations and confirming data from Venona, Currie ranked among the most influential Soviet agents ever in the U.S. government, if only by virtue of his portfolio in the White House dealing with affairs of China. And while he would leave that post in 1945, he was still hanging around in the latter 1940s, assured enough of his protected status to bluff his way through House committee hearings in which he self-righteously denounced the Bentley charges. So this Bentley-Chambers-Venona–certified Soviet asset was also never brought to justice.*219

  Three top Soviet agents shielded by a single fix would seem to be enough for any Cold War thriller, but that too was merely a beginning. All these pro-Moscow apparatchiks had contacts in and around the U.S. government, and policy-making circles elsewhere, who needed serious scrutiny in 1945 but also didn’t get it. We have noted Adler’s links to Harry White, their joint endeavors to sink the gold loan to Chiang, and close liaison in general. Any halfway competent pursuit of Adler would have led back to White, but this pro-Moscow agent would likewise be spared public notice until some three years later. And White, as seen, was primus inter pares among a host of pro-Red Treasury staffers, all similarly shielded when White and Adler dodged the spotlight.

  Meanwhile, at the State Department and related units dealing with policy toward China were confederates of Service (and Currie) who also merited close inquiry. These made up a considerable list, including John Carter Vincent, John Paton Davies, Haldore Hanson, Raymond Ludden, O. Edmund Clubb, John K. Emmerson, and Julian Friedman, all of State, Owen Lattimore and “the boys” in the Pacific division of OWI, Duncan Lee of OSS, John K. Fairbank of OWI, Benjamin Kizer of UNRRA, T. A. Bisson, and Miriam Farley (the last two soon to be with the occupation forces in Japan), to cite some of the more obvious cases.

  This is only a partial roster, but on its face a pretty formidable crew of people on the federal payroll when the Amerasia case was buried. The fix thus protected not just a handful of suspects but a whole interlocking network of staffers linked in one way or another to the Service-Adler combine. It was this group that Joe McCarthy in his rough-and-ready fashion set about dragging into public view, case by painful case, in 1950. But a substantial part of the operation could have been exposed in 1945 had steps been taken to follow the tangled threads of Amerasia back to their mysterious sources. In the five-year span between the fix and the McCarthy blowup of 1950, the fall of China was accomplished.

  And even this, sad to relate, wasn’t quite the total story. Supportive of the Service-Adler camarilla, and tightly interwoven with it, was yet another unthinkable operation that also needed scrutiny in 1945 but also managed to evade it. This was the Institute of Pacific Relations, already met with in several places, which included among its leaders, active members, and close collaborators many important players in the China drama. As the IPR was cheek-by jowl with Amerasia in every way that mattered, a cover-up of Amerasia was de facto a cover-up of IPR as well, and ensured that this remarkable group would be spared the notice it deserved—until, again, the advent of McCarthy.

  Among the most conspicuous features of the IPR was its globe-girdling character, with affiliates in ten countries and contacts in still others, plus many connections in the U.S. government, academy, foundation world, and press corps. This web of contacts was not only extensive but of unusual nature. The constituency of the IPR ranged, quite literally, from hard-core Soviet agents on the one hand to high-ranking State Department officials on the other. At its meetings in the war years and early postwar era, concealed Communist functionaries (and some not so concealed) hailing from Europe, Asia, and North America freely intermingled with movers/shakers in U.S. policy-making circles. It’s doubtful there was anything quite like it elsewhere in the annals of the Cold War, or in the history of nations.

  A brief sampling of the IPR’s array of international contacts has been provided in an earlier chapter. As there noted, the Sorge ring in Asia included such IPR-connected figures as the American writer Agnes Smedley, the German-born Guenther Stein, the Chinese Red agent Chen Han-Seng, and Japanese comrades Ozaki and Saionji. The Cambridge University set, meantime, embraced such IPR familiars as the Briton Michael Greenberg, the Canadian Herbert Norman, and the American Michael Straight. On the official U.S. end of things, the combine included Currie at the White House, Lattimore at OWI, Vincent and Alger Hiss at State—all four serving, at one time or another, as trustees of IPR. The global reach, p
ro-Red ties, and high-level influence of the group are well suggested by these cases.

  Some aspects of this fantastic tale were known to Joe McCarthy in the early going, while others would develop piecemeal later. In his initial speeches to the Senate, McCarthy discussed some of the IPR’s remarkable personnel, its links to Amerasia, and its entrée to the State Department, contending it had been a baleful influence on our policy toward China. Like everything else he had to say, these charges would be dismissed out of hand by Tydings, the State Department, and most people in the mainstream press who had anything to offer on the subject. Seldom has the unthinkability factor been more pervasive, or effective in its workings.

  On the surface, the IPR was a respectable group and always claimed to be such. It had begun in 1925 as a spin-off of the YMCA, part of a larger trend in Christian circles to foster interest in and religious missions to China and other nations of the Far Pacific. Students of the matter agree that, at the beginning, it was a legitimate outfit that did good work in spreading knowledge of events in Asia. Prominent scholars, business leaders, and public officials cooperated with it, served on its boards, and otherwise approved it. The prestige of these eminent people was undoubtedly its major asset.

  When McCarthy attacked the IPR before the Senate, the shocked reaction of his foes was geared to this respectable image. Sen. Clinton Anderson (D-N.M.) asked, with obvious incredulity, “Does the senator [McCarthy] mean to convey the impression that the Institute of Pacific Relations, in 1935 and 1936, was under Communist control?” When McCarthy noted the IPR connections of Philip Jessup, the response of the Tydings panel was the same. Jessup’s ties to IPR, said Tydings, “do not in any way reflect unfavorably on him when the true character of the organization is revealed…men of unquestioned loyalty and integrity have been instrumental in the management of the organization and making financial contributions to it.”1

  This Tydings comment didn’t say who all the outstanding people were involved in managing the IPR, but the obvious reference was to the illustrious names appearing on one letterhead or another. Any such allusion, however, was misleading, since most of these distinguished gentry had nothing significant to do with running the organization, as is frequently true with letterhead groups of all persuasions. With few exceptions, these reputable civic leaders, educators, and business moguls knew as much about the doings of the IPR as its real managers chose to tell them—which was de minimus, and that only of a flattering nature.

  At the real managerial level, things were starkly different from the high-toned image so impressive to Anderson, Tydings, and others who dismissed McCarthy’s charges. Here an astonishing cast of characters held forth, controlling the program on a daily basis and pretty much running things as they wanted. Foremost among these inside players was Edward C. Carter, who under various titles and guises was long the dominant figure in the operation. It was Carter who managed the office, raised the money, administered projects, and was involved in all the key decisions. A former YMCA official, he joined the staff of the nascent IPR in 1925 and stayed there in one capacity or another for upward of two decades.

  By all accounts, Carter was a natural-born promoter, and used his abilities along these lines to help IPR to grow and, in its fashion, prosper. From a very early date, he would put his imprint on the group in the way that this is commonly done—by hiring the people who actually did the work and ran the program. And the people he hired would tell the tale as clearly as anything could do it. In 1928, to get things rolling, Carter asked a recent Harvard graduate, Frederick V. Field, to serve as his assistant. Not long after, he hired Field’s Harvard friend and classmate Joseph Barnes to help out around the office. At about this time as well, Carter brought on another thirtysomething staffer, Owen Lattimore, to edit Pacific Affairs, the group’s flagship publication.

  Carter, Field, Barnes, and Lattimore thus made up the inner core of the IPR as of the early 1930s. They would later be joined by other staffers of similar background and opinions. These included Barnes’s wife, Kathleen, Bryn Mawr graduate Harriet Moore, researcher Hilda Austern, and writer/editor Kate Mitchell. Also added to the team, as part of an increasingly multinational setup, was Elsie Fairfax-Cholmeley, who as the name perhaps suggests was English. The global flavor would be enhanced with the addition of Ms. Cholmeley’s fellow Briton Michael Greenberg, Chinese nationals Chen Han-Seng and Chi Chao-ting, and the German-born Guenther Stein (as Chungking correspondent). Also added to the roster were the Americans T. A. Bisson, Harriet Levine, Andrew Roth, Rose Yardumian, and Talitha Gerlach, to name a selected handful.

  Unfortunately, the punch line of this recitation has been spoiled, as many of the IPR personnel just cited have previously surfaced at various places in our discussion. As reflected in official records, all of the 17 people thus brought on board by Carter—from Field to Talitha Gerlach—had one unusual attribute in common: Each would be named in sworn testimony, the chronicles of Venona, or official reports of Congress as a member of the Communist Party or a collaborator with Soviet intelligence agents.2

  By any standard, this was a prodigious number of people with a relatively small outfit—or even a relatively large one—to be identified in this manner. Even granted the usual ripostes about witch hunts, kept witnesses, and such, it’s hard to imagine how 17 people connected to a single group of modest size could thus be targeted for ulterior reasons by “paid informers.” The point would be made by the Senate subcommittee that delved into the character of the organization:

  “The IPR…was like a specialized flypaper in its attractive power for Communists…British Communists like Michael Greenberg, Elsie Fairfax Cholmeley, and Anthony Jenkinson; Chinese Communists like Chi Chao-ting, Chen Han-Seng, Chu Tong, or Y. Y. Hsu; German Communists like Hans Moeller (Asiaticus) or Guenther Stein; Japanese Communists (and espionage agents) like Saionji and Ozaki; United States Communists like James S. Allen, Frederick Field, William Mandel, Lawrence Rosinger, and Alger Hiss.”3

  The inevitable effect of such a lineup was an off-the-charts subversion index, certain to get the attention of people who knew anything about security matters. According to Elizabeth Bentley, indeed, Soviet spy chief Jacob Golos had warned her to steer clear of the IPR because it was so obviously riddled with Reds the FBI was bound to notice. It was, he said, “as red as a rose, and you shouldn’t touch it with a 10-foot pole.” The comrades of the IPR, Golos told Bentley, were “far too bungling and too much in the open…”4

  Similar testimony would be offered by Louis Budenz, ex–managing editor of the Daily Worker. The IPR, he said, was described to him by Communist nabob Alexander Trachtenberg as a “little red schoolhouse,” controlled by CP members, to “teach Americans what they need to know about China.” Trachtenberg added, per Budenz, that Communist leaders praised the group for its pro-Red propaganda efforts but were troubled by its lack of caution: “They felt the Institute was too much a concentration point for Communists; the control could be maintained without such a galaxy of Communists in it.”5

  From these and collateral data dug up by Senate investigators and the FBI, it appears the august and scholarly IPR had been taken over from within, and by some rather sinister people. The respectable facade, however, remained, and for a considerable time would be impervious to attempts to publicize the capture. An early instance was the effort of businessman Alfred Kohlberg, a dissident member of the group, who staged a protest against its leadership in the middle 1940s. An importer dealing in goods from China, Kohlberg had traveled in the country and knew a fair amount about it. Studying Institute materials, he concluded the IPR was indeed a “little red schoolhouse,” and produced an eighty-eight-page documentary memo that sought to show this.

  Kohlberg’s campaign, however, was unavailing, as the staff of the IPR prepared a vigorous counterblast against him, and the group’s executive board endorsed this as adequate answer to his charges. Thereafter, Kohlberg would be branded as a mercenary looking out for his business interests and im
pugned as head of the “China lobby,” an allegedly evil pressure group much execrated by media outlets such as the Washington Post and the columns of Drew Pearson. Later, the similarity between the Kohlberg charges and the allegations of McCarthy would be apparent to any who bothered to compare them, and the pro-IPR arguments and unthinkability defenses used in the Kohlberg battle were thrown into the breach against McCarthy.

  Though McCarthy was in fact getting IPR material from Kohlberg, this wasn’t his only source of information. As seen, McCarthy had a knack for developing data that alarmed his foes, and he displayed that talent in this instance. On March 30, 1950, he told the Senate he had been informed by a former Soviet intelligence officer that Moscow was “having excellent success through the Institute of Pacific Relations,” which the Soviets, “through Communists in the United States, had taken over.”6 (This source was Alexander Barmine, whom McCarthy and Morris wanted to bring before the Tydings panel but who wasn’t called.) McCarthy also came up with documents, including canceled checks, showing the key role played in the IPR by the millionaire Communist Field, whose deep pockets helped to fund the operation.

  Like Kohlberg, McCarthy initially didn’t make much headway against the IPR and the massed forces of denial, as the group, like all other McCarthy targets, would be given a clean bill of health by Tydings. This time, however, there would be a morning after. In 1951, the U.S. Senate created the Internal Security subcommittee of the Judiciary Committee—both panels headed by Nevada Democrat Pat McCarran—to investigate subversion of all types and see about the enforcement of relevant statutes. Its first in-depth investigation would be a probe of the IPR—thus picking up the ball where McCarthy had by main strength contrived to push it and Tydings, in his usual manner, dropped it.