by Connie Bruck
Those who wanted to curry favor with the president (or, at least, protect themselves) were fulsome—and none more than Henry Kissinger, assistant to the president for national security affairs. Kissinger, who enjoyed his frequent forays to Hollywood and was a regular on the party circuit there, was a good friend of Schreiber’s, and when Kissinger saw Nixon the day after the April 5 speech, he put in a good word for Schreiber as well.
KISSINGER: Yesterday—I didn’t tell you this—Taft Schreiber came in to see me and he said he had just seen Finch. He said, how can you be so calm when Finch is shaking all over? He said Finch was literally—his hands were shaking. This morning Finch is very happy. He thinks it was a great speech.
NIXON: You know, it’s a funny thing. It was nineteen minutes and thirty seconds, which was the right length, but beyond that—that little conclusion we stuck on there. That’s what made it for Mr. Average Joe, don’t you think?
KISSINGER: Absolutely! Oh, yes.
NIXON: They couldn’t help but be moved by it.
KISSINGER: I must say, [Kissinger’s deputy Alexander] Haig had tears in his eyes, I had tears in my eyes, even though I’d heard it before. But, your bearing, I thought—
NIXON: That sort of thing takes a lot out of a person—
KISSINGER: Oh, God—
NIXON: Just the creative thing. I didn’t create too much—
KISSINGER: You created the architecture. Even the parts you didn’t write, you put it in your idiom. But also the architecture, Mr. President, the balance of the speech—I thought it was a really great speech, Mr. President.
On April 9, in a wide-ranging meeting with Haldeman, Garment, Finch, and Nancy Hanks, chairman of the National Endowment for the Arts (NEA), Nixon expounded at length on his views about the motion picture industry as well as Schreiber’s pet project, the Hirshhorn Museum. Nixon opened the meeting with a compliment for Hanks, an attractive, vivacious woman, so effective a spokesperson for the arts that by 1976, when she finished her second term as chairman, the federal arts budget would have grown from $8 million to almost $90 million. “In my meeting with the movie people, with all their bitching, they just spoke glowingly of you,” Nixon told Hanks. Then, in an apparent reference to the “bitching,” he added, “I’m not speaking of Taft Schreiber”—which was greeted by appreciative chuckles all around, from these Schreiber supporters.
When the subject of foreign competition came up, Hanks ventured that “the quality of films in this country is not as good as many of the foreign films—”
NIXON (interrupting): I think some of them are pretty lousy. I think the foreign films that are supposed to be so great . . .
HALDEMAN: What the foreigners are doing better than we are is producing family movies.
NIXON (to hanks): Now, now, this is what I want you and Leonard to get into. . . . We should start producing good movies. And the family movie is coming back, it’s coming back very fast. I sense it. Do you agree?
GARMENT: Right. The romantic mood—
NIXON: My kids tell me. They, and all their friends, frankly they don’t like it—the thrill of the moment. They don’t like it.
GARMENT: I find my kids are fascinated by the old movies that they see on television. The nine- and ten-year-old. They find there’s a strong story, strong characters. You don’t have that in a lot of the contemporary—
NIXON: And they’re so offbeat! . . . Nancy, let’s make a study of this damn industry, from an arts standpoint. And—is it worth saving? I don’t want to subsidize a turkey! Maybe we can’t get a subsidy. At the present time we sure can’t get it from the Congress, the Congress will never subsidize movies, never, never—unless they improve the quality. On the other hand, the industry’s hurting, and we have to do everything we can to save it.
One way to improve the quality of movies, the president continued, would be to provide better cinematography education. Hanks mentioned that the NEA was sponsoring forty interns in a program at the American Film Institute.
Nixon responded, “Remember, lean to the square side. I know your natural bent, but lean to the square side. . . . What I mean is, lean to it because . . . as a business proposition, I know we’re right, and that’s all Hollywood cares about, their dough. But they are on the wrong track! They are still making the weird pictures, whereas the kinds of pictures people like to see are stories, they want to see a story! . . . Like Charlton Heston, he always plays in story movies. We just gotta make some movies that do tell stories. Why is it for example that people still go see John Wayne?”
After some back-and-forth, Nixon began speaking again, very emphatically—and with an attack on one of his favorite targets. “Let me suggest this. The industry may be reflecting the national intelligentsia, and that’s always wrong. What you need to tell them—I want you to talk cold turkey to them. And say, look here, you’ve got to clean your own houses, or we’re not gonna do these things for you. We’re not gonna take six steps that are going to help a sick industry. They’ve got to shape up. They’ve got to shape up their labor policies, they’ve got to shape up their production costs, and also, I would strongly urge, they’ve got to shape up in terms of what they’re making . . . they damn well have got to make better movies. Isn’t that a true point?”
Garment bemoaned the lack of great American movies, and Nixon remarked that the only two new movies he’d seen were Patton and Love Story. Nixon told Garment that he wanted him to “get on the phone to those movie people” and enlist their help in conducting a study in conjunction with the NEA on ways to improve the quality of American films. Finch volunteered that he thought Schreiber would help.
“Is he a decent human being?” Nixon asked. His visitors gave emphatically affirmative murmurs.
On the subject of the Hirshhorn Museum, Nixon agreed, without enthusiasm, that it should go forward—but he insisted it should not look like “that horrible Whitney thing they have in New York.” Scanning a list of proposed board members, Nixon made one of his standard quips. “Is there anybody on this list that’s not Jewish? Not that I’m anti-Semitic”—laughter from his visitors—“but you don’t want an all-Jewish list.” Garment responded, “Well, these are the art experts. I spoke to Taft about the names.” “There must be at least one,” the president objected. To which Garment replied, “There’s one. He’s a good friend of Johnson’s. Hobart Taylor. He’s black. He’s not Jewish.” Nixon approved of some of the proposed board members, like Schreiber, Mrs. Walter Annenberg, and producer Hal Wallis. But, he said, “Let’s get the Easterners off this list.” He vetoed H. J. Heinz II. “The trouble with Jack Heinz—Heinz is part of the Eastern establishment . . . he’s a very nice fellow—I’ve had him, Eisenhower used to have him, to virtually every dinner. But he never gives! Never! Well, the hell with him.” Nixon said he wanted to add Theodore Cummings to the board. Cummings, a successful developer in Los Angeles, was one of Schreiber’s closest friends. “Ted Cummings is one of the wealthiest people but you’d never know it, except that he lives in a $300,000 house, right near Hillcrest, which is the most expensive golf club in America,” Nixon told the group. “And he’s got the best art collection.” Nixon also suggested Norton Simon, the Los Angeles industrialist, and said that he should be invited to the White House. Garment volunteered that he thought he could get a contribution from Hirshhorn, and that if Hirshhorn were shown some presidential attention, he might switch from being a Democrat to a Republican.
Schreiber’s strategy, in any event, had worked nicely. Nixon had come to see the Hirshhorn—in its board of trustees, at least—as a rich resource. Referring to these prospective trustees, he spelled out his thinking. “I want to help some of those people that can help us.”
Over the course of the next couple of weeks, Schreiber worked hard to exploit what Nixon had set in motion following the San Clemente meeting. He met with Peter Flanigan, the assistant to the president who was charged with directing the administration’s efforts on behalf of the movie industry. Togethe
r, Schreiber and Flanigan met with Peter Peterson, director of the Council for International Economic Policy, to discuss the problem of foreign movie industry trade barriers. In Los Angeles, Dean Burch, chairman of the Federal Communications Commission, met with Schreiber and a movie industry group that Schreiber convened to discuss a number of issues, including copyright protection, in dealing with cable TV. Schreiber was sent a copy of proposed legislation dealing with piracy, and he advised Flanigan’s assistant, James Loken, that the bill had unanimous industry support and “by all means we are for it.” Schreiber met with Richard McLaren, the assistant attorney general in charge of antitrust, in Los Angeles to discuss, among other things, the Justice Department’s suing the networks, forcing them to cease producing movies for their own exhibition. Flanigan, on Schreiber’s behalf, met with Henry Kearns, head of the Export-Import Bank, to discuss how the bank might finance movies. Schreiber met with Ed Cohen, assistant secretary for tax policy in the Treasury Department, to explore how far the Treasury could go in meeting the desires of the movie industry for a couple different kinds of tax relief.
It was extraordinary to have so many different doors in Washington opened with such synchronicity. Schreiber was a tough, hard-bitten type, accustomed to the perquisites of power in the movie colony, but still his sudden ability to command attention in the nation’s capital must have been rather heady. On April 26, he wrote a slightly breathless thank-you note to the president. After citing the numerous areas in which the administration was offering its help, Schreiber continued, “No President before you has shown such concern for this industry which you choose to construe as a National resource, nor could any industry have the munificent attention showered upon it that you directed for the Motion Picture and TV Film companies. . . . History will record the fact that you did all of this without any political motive, for it seems of the 20 people in attendance at San Clemente only three were Republicans. I would love to change this one-sided state in the time ahead. For all your personal intervention and help I am indebted to you to the degree that I can hardly describe. I will somehow reciprocate with my friendship, efforts and loyalty, for the benefits to accrue to my company and our industry. So too should the motion picture industry feel this enormous debt to you.” And in a note to Peter Flanigan, Schreiber made his point even more clearly: “I will do whatever is within my power to help this Administration and President Nixon and expect to devote a substantial part of the coming two years to in some small part begin to repay the obligation that I feel to him and all of you.”
The issue that was processed most rapidly to fulfill movie industry desires was accelerated tax depreciation. Before Nixon agreed to meet with the movie people, Treasury Secretary John Connally had assured Nixon that this could be accomplished administratively. A controversy had arisen between the movie companies and the local IRS office concerning the time frame for deducting the cost of producing a movie. The cost is deducted not when it is incurred, but over the period of anticipated revenues from its exhibition. Since so many movies were being shown on television, some IRS officials had taken the position that the costs had to be deferred against possible revenues from television showings, long after theatrical exhibitions had ended. The movie companies, naturally, wanted more liberal depreciation rules, where such deferrals did not have to be made.
What Ed Cohen quickly discovered was that there was not one apparent remedy that was optimal for all companies. Schreiber took the lead with Cohen, and adopted a rather supercilious attitude regarding his competitors. As Flanigan’s assistant, Loken, wrote in a memo to his boss on April 12, just one week after San Clemente, “Schreiber advises that he has urged Jack Valenti to push the other companies to be fully responsive to Cohen. Schreiber suspects that the other companies have the notion they can get anything they want if they simply plead poverty loud enough. Schreiber and Valenti want the industry to seek practical forms of tax relief.” On April 23, Loken wrote that Cohen had met with MCA executive George Smith, and that Cohen would shortly be meeting with both Smith and Schreiber. The problem was that MCA by this time was in a stronger position than most of the other companies, and the remedy they wanted was best, of course, for them. Cohen “has hit upon a scheme which will clearly help companies other than MCA, and . . . it may also be helpful to MCA,” Loken wrote. About a month later, in a memo entitled, “Status of Movie Industry Efforts,” Loken wrote, “Ed Cohen’s office has completed development of a program which is satisfactory to MCA.”
The Export-Import Bank was another area where the administration moved promptly to satisfy movie industry requests. Schreiber had been trying for some time to use the bank as a financing vehicle—something that could be hugely helpful in these cash-starved times. But his earlier proposals had been rejected by Henry Kearns, head of the bank. In a memo on April 12, 1971, Loken wrote that Schreiber had come up with a new plan: “Without blaming Kearns for the problems of last year, Schreiber commented that Kearns ‘must control his people’ so as to implement this new program.” By early July, all previous obstacles had been overcome, and the Export-Import Bank—which had always refused to finance motion picture industry exports in the past—was ready to do so.
These were highly beneficial moves for the movie industry. But the single most desirable governmental action, certainly in Schreiber’s view, would be an antitrust suit against the television networks. Through Jack Valenti and MPAA general counsel Louis Nizer, the industry had been lobbying the Justice Department to file such a suit for nearly four years. In the fall of 1967, two of the three major national networks, CBS and ABC, announced plans to go into the movie-making business, for both theatrical and television exhibition. (NBC—which had signed its record-breaking agreement to purchase movies from MCA—remained on the sidelines.) Hollywood complained that the networks’ producing movies was the same kind of vertical integration—production and exhibition—that movie producers had been found guilty of in 1948 when they had to sell their theaters. Many producers were alarmed at the prospect of the networks’ buying fewer movies from Hollywood, but surely the most alarmed were on the fifteenth floor of the Black Tower at MCA. For while its feature film division was hemorrhaging in the late sixties, the highly profitable TV business was the engine of the company. Indeed, the World Premiere format, pioneered by MCA and NBC in 1966, had proved immensely successful, scoring consistently high audience ratings; these TV movies also served as pilots for series such as Ironside, and Dragnet. It was not surprising that ABC and CBS would decide to produce such movies for themselves; CBS even hired away the Universal executive in charge of World Premiere, which to Wasserman was tantamount to a declaration of war.
In mid-August 1970, Nizer had paid yet another visit to longtime Justice antitrust staff attorney Bernard Hollander. In a memo about his conversation with Nizer, Hollander wrote that Nizer had come “to renew his plea that the Department take some action in this matter promptly, since the situation of the motion picture industry is beyond the critical stage. Mr. Nizer stated that he was at a loss to understand why, after three years of supplying information to the Department, and with companies such as 20th Century Fox and MGM on the verge of bankruptcy, and Walter Reade and other important independents having abandoned motion picture distribution, that the Department remains quiescent in the face of what he alleges are clear antitrust violations by the networks, responsible at least in part for the dire straits in which the movie companies find themselves.” About six weeks later, most of the major movie producers, evidently despairing of governmental action, decided to take matters into their own hands. They filed a civil antitrust action against the networks—in effect, demanding that CBS and ABC function strictly as exhibitors of movies made by other companies.
The San Clemente meeting, however, stirred hope that Justice might now be more compliant. There was no mistaking the importance Schreiber and other industry leaders placed on it. As Loken wrote in his notes, “Network lawsuit—biggest thing industry could get.” Ab
out two weeks after San Clemente, on April 21, Attorney General John Mitchell came to see Nixon. He said he’d heard from John Ehrlichman, counsel to the president, that they were supposed to put off the network suit.
NIXON: Let me tell you the reason . . . I’m for that suit—but I don’t want to have the impression, right after this “Selling of the Pentagon” [a CBS exposé of the Defense Department’s public relations activities] that we are pressing this—
MITCHELL: . . . You know who’s going to get all the benefit of this . . . are the motion picture industry, the people who have been after us for years.
NIXON: John, John, I’m for it, I’m for it . . . anything you can do to the networks, more power to you. . . . Under no circumstances is it to be dropped. I just don’t want you to do it right now . . . but give it to ’em. And, incidentally, get some credit from the movie people, would ya?
MITCHELL: (inaudible)
NIXON: That’s one of the reasons I’m for it . . . Taft Schreiber. . . . The main reason I’m for it though is I wanna screw the networks. In any event, they’ve gotta be screwed. They’re terrible people. They’re a bunch of bastards. But the movie people, when we were in California, with Taft Schreiber—I promised them we’d do something. Oh, no, I’m all for it! This is purely political, in timing.
