This time, the organization was the Democratic Congressional Campaign Committee.
Like the Little Congress at the moment when Lyndon Johnson’s gaze fell upon it, the committee was a moribund organization. Established in 1882 to assist Democratic candidates for the House of Representatives with services and campaign funds, its usefulness had seldom if ever reached a significant level. During the 1930’s, under the chairmanship of Patrick Henry Drewry, a diminutive, soft-spoken Representative from the Virginia Tidewater, even that level had been reduced, for Drewry was ill-suited to the role of aggressive fund-raiser, not only because of personal considerations—“He was every inch a country gentleman; he could never ask anyone for a dime,” says a friend—but because of moral and philosophical ones as well: the very concept of the massive use of money in political campaigns was repugnant to him, and, as a staunch states righter, he saw dangerous implications for the independence of the nation’s elected representatives in the distribution of money through a monolithic central committee. He had therefore decreed that the committee’s maximum contribution to a Congressman would be $250. Few candidates received even this amount. The dichotomy within the Democratic Party, with its bitterly antagonistic liberal and conservative wings, kept the committee’s bank account small: big contributors were unwilling to provide money which might then be channeled by the committee to candidates with opposing political views; for a wealthy liberal, the idea that his money might help finance the campaign of a conservative Midwest Congressman was distasteful—as distasteful as the idea that his money might help a New York liberal was to a wealthy conservative. (Drewry’s lack of enthusiasm for distributing money was especially marked when the distributee was to be a Northern liberal.) The committee’s funds had traditionally come primarily from two sources—contributions from Congressmen themselves, and handouts from the Democratic National Committee—and during Drewry’s chairmanship, these sources had slowed to a trickle. For some decades, the committee had requested $100 from each Democratic member of the House to fund its operation; under Drewry, this request had been reduced by 1938 to $25—and when few members honored it, Drewry made only a token effort to collect.
Democrats who turned to the committee* for non-financial help were also likely to be disappointed; although the committee had a speakers’ bureau, headed by E. J. MacMillan, the bureau functioned only in non-presidential election years; when a presidential election was taking place, Congressmen who telephoned to ask for a Cabinet member or other “name” speaker to appear in their districts found MacMillan gone—he was invariably drafted by the National Committee and sent to New York to help in the “national” campaign. The committee’s other staffer was its capable secretary, Victor Hunt (“Cap”) Harding, a political scientist from California and one of the House of Representatives’ deputy Sergeants-at-Arms. During a campaign, Harding would take an office—generally only one room—in the National Press Building at Fourteenth and F streets so that he could accept whatever contributions happened to come in without violating the law which forbade the accepting of campaign contributions in a federal building. During campaigns, therefore, when the Congressional Campaign Committee should have been most active, its office, a dim, green-carpeted room in the basement of the Cannon House Office Building, was often utterly deserted—a condition which sometimes was only slightly improved even on the rare occasions when Drewry scheduled a meeting of the “committee” itself, which consisted of one Congressman from each state; more than once, the only persons who bothered to show up were Drewry and Harding.
In 1940, Democratic congressional candidates were even more desperate than usual for cash. The amounts they needed were, in most cases, small—ridiculously small not only by the standards of later eras but in comparison with the amounts spent during the pre-war era in statewide races and in the presidential campaign. The amounts varied greatly; congressional races in the urban centers of the Northeast could cost tens of thousands of dollars, but in the rest of the nation the situation was far different. In 1928, for example, Ruth Baker Pratt spent $12,000 in her campaign for a House seat from New York City. That was several times the total amount spent that year by all six candidates for the three congressional seats in the State of Oregon. A detailed study of expenditures in House races in that state between 1912 and 1928—the most detailed study available for the pre-war period—showed that of thirty-eight candidates for Congress, only three had spent as much as $3,000. Twenty-four of the 38 had spent less than $1,000. This situation had not changed much in 1938. In that year, the six candidates—three Democrats and three Republicans—for Oregon’s three seats spent a total of $12,987, a little more than $2,000 per candidate. In most other Western and Midwestern states, the range that year was the same. “In the great majority of cases campaigning for a seat in the House of Representatives is not an expensive business,” wrote Louise Overacker, the era’s leading academic expert on campaign finance. Discussions with Congressmen of that era indicate that most campaigns cost less than $5,000. And their recollections are confirmed by insiders who had an overview of the situation, such as Thomas Corcoran and James Rowe. In politics, says Rowe, “Five thousand dollars was a hell of a lot of money in those days.”
Little as Democratic congressional candidates needed in 1940, however, there was small hope that they would get it from their Congressional Campaign Committee. Because the nation’s business community was so overwhelmingly Republican, funds were traditionally in short supply at Democratic National Committee headquarters at the Biltmore Hotel in New York. The party had been outspent by the GOP in every national election since 1920, and the gap had been huge in 1936. And never had the supply of funds been shorter than in 1940. Fueled by rage at Roosevelt and possessed of an attractive candidate to run against him (“For the first time since Teddy Roosevelt,” said Time, “the Republicans had a man they could yell for and mean it”), the GOP was gearing up—and shelling out—for a supreme effort to put its own man in the White House. After the election, a Senate committee would determine the ratio of expenditures between the two parties as almost two and a half to one. The Democrats, anxious to put such seasoned speechmakers as Harold Ickes on the air, found that they simply “did not have the money to spend” on more than a few such nationwide broadcasts. The five great radio speeches by Roosevelt himself that were to boost his popularity during the last days of the campaign would not have been broadcast had not Richard Reynolds, of the North Carolina tobacco family, appeared on the scene with a last-minute $175,000 loan to pay for the radio time. The National Committee needed every dollar it could raise for the presidential race, and was going to be able to spare very little funds indeed for its poor relation in Washington.
Even had funds been ample at the Biltmore, there would have been little disposition to divert them to the National Press Building. Farley, bitter at the President he believed had deceived him, resigned in August as chairman of the Democratic National Committee. His replacement, Edward J. Flynn, Boss of the Bronx, did not possess Farley’s national acquaintance. “I did not know many” Senators and Congressmen, he was to recall. They were aware, moreover, that Flynn’s loyalty ran only to the President; “Many of them were suspicious of me and displayed no great enthusiasm over my appointment. They fully realized that the appointment was purely personal on the President’s part and that he had not consulted with them before he made it. …” Flynn was not particularly enamored of them, either: attempting to enlist the fund-raising help of prominent Senators and Congressmen, he found that “few if any” were willing to help. Tensions could not be eased by the National Committee staff, for it was a new staff brought in by Flynn, and it consisted of men he knew—New York men, unfamiliar with the embattled campaigners from Capitol Hill, and hence not particularly anxious to assist them in their campaigns.
For many Democratic Congressmen, raising funds of their own was going to be harder in 1940 than ever before. “The year 1936,” Alexander Heard has noted in his landmark stu
dy of campaign financing, The Costs of Democracy, “was a turning point in the history of political party fund-raising. The policies and methods of Franklin Roosevelt’s first term produced political alignments more along economic-class lines than any since the McKinley-Bryan era.” Democratic Congressmen from large cities—where burgeoning labor unions were expressing their appreciation for pro-labor New Deal policies with lavish campaign contributions—were aided by these new alignments. Other Congressmen—and that included most Congressmen—were hurt. Once, a Congressman from a rural district or a district that included a small city had been able to rely on contributions from the district’s businessmen. By 1940, these businessmen—and their contributions—had turned against the New Deal.
The outlook had not been particularly bright for congressional Democrats even before campaign finances were included in their calculations. In 1938, the Democrats had lost eighty-two seats in the House. Since they had gone into that election with an overwhelming congressional majority from the Roosevelt landslide of 1936, they still held a substantial 265-to-170 margin, but polls early in 1940 showed that about sixty additional Democrats could expect to lose their seats in 1940. And the campaign financial picture added to the gloom. Recent studies had documented the decisive role of money in elections; in one study of 156 state and local elections, all but eleven had been won by the side that reported spending the most money. Politicians had long since reached the same conclusion. Professionals firmly believed that, as Heard put it, “the side with more money has a better chance of winning.” In only two of the twenty presidential elections since 1860 had the party which spent less money come out the winner; those were the elections of 1932 and 1936, and the rule had been shattered by the Depression combined with the extraordinary popularity of Roosevelt—but now the Depression was over and so, apparently, was at least some of Roosevelt’s popularity, and the old rule could be expected to reassert itself. At the Democratic National Convention in Chicago in July, pols could be heard muttering gloomily about the lack of funds. Some of them turned to Rayburn for help. Nan Wood Honeyman of Portland, Oregon, once the only female member of Congress, had been defeated in 1938, and had learned the necessity of adequate campaign financing. In 1940 she was attempting to win back her seat, and at the Convention asked Tommy Corcoran and Rayburn for help. Corcoran, in his breezy, confident way, “asked how much it would take—‘two, three, five thousand?’—indicating a willingness to do the necessary.” When the amount needed was set at $5,000, Corcoran said he would contribute $2,000, apparently by tapping private sources in New York, and Mrs. Honeyman said she could raise $2,000 herself from local contributions. That left $1,000, and on the last day of the Convention, Rayburn, in a conversation at which Johnson was present, agreed to find her some funds. As it turned out, however, he was unable to do so. His hope that the Congressional Campaign Committee would be funded by the National Committee more generously than usual was already dimming. When he attempted to convince Flynn to set aside $100,000 for help in congressional campaigns, the reaction was reserved. He repeated his plea by letter (“A great many of these fellows need help”), adding: “Let me say to you again … how important it is to reelect a Democratic House. I remember when President Wilson lost the House in 1918, his path was made rather rough by the Republicans investigating everything that had been done. …” Rayburn then threatened “to keep the funds raised by the congressional committee separate from the National Committee treasury and use them for the members of Congress in need of campaign assistance,” but the Congressional Committee’s lack of fund-raising ability made this threat an empty one. No further word came to Portland from Corcoran, whose time and money-raising abilities were, shortly after the Convention, assigned to the presidential campaign, and when Mrs. Honeyman contacted Rayburn through an intermediary in Washington, he was forced to reply in embarrassment that he would see that she got help “when and if there are funds available to the Congressional Campaign Committee.” He was forced to give a similar answer to other candidates who asked for assistance. At a dispirited Democratic caucus on the subject of fund-raising, the only suggestion Rayburn could make was that Congressmen who had ample funds or safe seats should contribute to the campaigns of those of their colleagues who were broke or in danger—but that suggestion would not solve the problem, as Rayburn himself knew even as he made it.
But Lyndon Johnson knew how to solve the problem. He himself could provide the party with substantial funds, and he could provide them fast. And he appears to have been able to generalize from his experience with Brown & Root. Leaving the gloomy caucus with Edouard Izac, another young Congressman, Johnson said, according to Izac, “‘Sam Rayburn’s all wet. That isn’t the way you raise money for the Democratic Party.’ Lyndon’s idea was to go to the contractors and get the money.”
He knew more. He knew, in fact, of a source of money that was available only to Sam Rayburn—and that even Sam Rayburn didn’t know about.
Oil money had long been a factor in politics in the United States. In Texas, oil had come in not long after the century; the Spindletop field on the Gulf Coast, which would eventually prove out at a hundred million barrels, one-tenth as much oil as had been produced previously in America, blew in on January 10, 1901. The robber barons who had tapped the oil fields of the Northeast had been using the sale of black gold to purchase politicians for decades before that; the Standard Oil Company, one historian said, did everything possible to the Pennsylvania Legislature except refine it. But the new oil fields of the Southwest had, through the first three decades of the twentieth century, been controlled by the same companies that controlled the old oil fields of the Northeast; with their control of pipelines, markets and refineries—and the capital needed to explore and drill—they bought out or forced out the discoverers of the Texas fields so thoroughly that in 1930 75 percent of the oil in Texas was owned by Standard Oil and its offshoots and rivals such as Humble, Magnolia, Gulf and Sun, and the owners of the other 25 percent had to sell their oil to these companies, who owned the refineries and pipelines, at prices so low that they were effectively prevented from accumulating capital of their own. The companies, and the families back of them, that poured money into politics in Texas—Gulf Oil (the Mellons), Sun Oil (the Pews), Standard Oil (the Rockefellers)—were the same companies and families who had been financing the Republican Party—and selected Democrats—for decades in Washington and in various states of the Northeast. Their political alliances on the national level had long been made and cemented.
But after 1930, there were new sources of oil money, for 1930 was the year of the great East Texas pool.
The first success among the test wells being “poor-boyed” (drilled on credit, with frequent halts to raise money to go a few hundred feet deeper) by long-broke wildcatters in a poverty-stricken area of East Texas was eight miles east of Henderson. The oil that gushed out of it on October 6, 1930, splashing down on the rusty drill and on the derrick floor set among the pine trees, was believed to come from an isolated pocket, because the major oil companies had been advised by their geologists that there was little oil in the area. The second well that blew in, two months later, was near Kilgore, thirteen miles to the north. That must come from an isolated pocket, too, geologists said. At any rate, being so far from the first well, it certainly couldn’t come from the same field. A month later, another well came in, near Longview, twelve miles farther north. Three separate fields, the geologists said: certainly no one field could be that big. But with the major companies uninterested, hundreds of small oil prospectors, men who had been wildcatting for years, most without success, rushed into the area. They found that East Texas was a “poor man’s pool,” not only because, with the majors not aggressively buying up land, oil leases could be obtained at reasonable prices, but because, at 3,500 feet, the oil was relatively close to the surface and the drilling was relatively inexpensive; since the East Texas oil was a high-grade, light-gravity oil with little sulphur contamination,
it could even be refined cheaply; some—very few, but some—of the wildcatters could refine their own oil and sell it to gasoline companies. By the end of 1931, in some weeks, wells were being sunk at the rate of one per hour. And no matter where they drilled, it seemed, not only between Henderson and Longview but to the north and south (and the east and west), when they reached a depth of about 3,500 feet and took a sampling of the sand, it came up resembling brown sugar—sugar that had been dipped in oil. By 1934, it was apparent that underneath those barren, dried-out cotton fields and miles of stunted pine trees was an ocean of oil more than forty-five miles long. By 1935, the East Texas pool was producing more oil than any state had ever produced—more than any nation had ever produced. Spindletop, with its hundred million barrels, had been huge. The East Texas pool had five billion barrels—fifty times as much as Spindletop.
And it was owned not by the majors, but by the independents.
The majors moved in and bought the independents out, of course; Humble alone wound up with 16 percent of the East Texas pool; by 1938, the majors controlled 80 percent of the field. But there was a difference. The East Texas field was unprecedentedly huge, and, to an extent true of no previous field, it had originally been owned by the wildcatters—so that this time, when they sold out, they came away rich. The owner of the first well to hit sold out for a relative pittance, but the owners of the second came away with $2 million, the owners of the third with $2.5 million. Some, like Sid Richardson, took their money and put it into other oil fields—in the Panhandle and in West Texas and down near Houston—and some of these fields came in, too, and this time they didn’t have to sell out at all; they could keep the profits themselves. There was by this time so much money that even if they had to share it with the majors, what was left over was millions of dollars. Hugh Roy Cullen, for example, brought in the Tom O’Connor Hill in 1934. He had to share it with Humble—but what he was sharing was half a billion barrels. And, more independent because they now had financial resources of their own, the new owners no longer had to share on the former disadvantageous terms. More and more often, in fact, they didn’t have to share at all. “More independent oil fortunes came out of the East Texas field than from any other place in the world,” an historian of the industry has written. “This was primarily because of the size of the field. Out of the thousands of tracts and town lots, there was something for almost everyone.” And because of this, the East Texas field “became a point of departure from the old pattern of Texans going, hat in hand, out of the state to solicit funds for expansion and development.” H. L. Hunt, for example, built his own pipelines, and was soon filling up the tank cars of the Sinclair Oil Company with his own oil.
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