by John Brooks
After his downfall, Saunders spent the better part of three years in seeking redress of the wrongs that he felt he had suffered in the Piggly Wiggly fight, and in foiling the efforts of his enemies and creditors to make things still more unpleasant for him. For a while, he kept threatening to sue the Stock Exchange for conspiracy and breach of contract, but a test suit, brought by some small Piggly Wiggly stockholders, failed, and he dropped the idea. Then, in January, 1926, he learned that a federal indictment was about to be brought against him for using the mails to defraud in his mail-order campaign to sell his Piggly Wiggly stock. He believed, incorrectly, that the government had been egged on to bring the indictment by an old associate of his—John C. Burch, of Memphis, who had become secretary-treasurer of Piggly Wiggly after the shakeup. His patience once more exhausted, Saunders went around to Piggly Wiggly headquarters and confronted Burch. This conference proved far more satisfactory to Saunders than his board-room scuffle on the day the Memphis civic stock-selling drive failed. Burch, according to Saunders, “undertook in a stammering way to deny” the accusation, whereupon Saunders delivered a right to the jaw, knocking off Burch’s glasses but not doing much other damage. Burch afterward belittled the blow as “glancing,” and added an alibi that sounded like that of any outpointed pugilist: “The assault upon me was made so suddenly that I did not have time or opportunity to strike Mr. Saunders.” Burch refused to press charges.
About a month later, the mail-fraud indictment was brought against Saunders, but by that time, satisfied that Burch was innocent of any dirty work, he was his amiable old self again. “I have only one thing to regret in this new affair,” he announced pleasantly, “and that is my fistic encounter with John C. Burch.” The new affair didn’t last long; in April the indictment was quashed by the Memphis District Court, and Saunders and Piggly Wiggly were finally quits. By then, the company was well on its way back up, and, with a greatly changed corporate structure, it flourished on into the nineteen sixties; housewives continued to ramble down the aisles of hundreds of Piggly Wiggly stores, now operated under a franchise agreement with the Piggly Wiggly Corporation, of Jacksonville, Florida.
Saunders, too, was well on his way back up. In 1928, he started a new grocery chain, which he—but hardly anyone else—called the Clarence Saunders, Sole Owner of My Name, Stores, Inc. Its outlets soon came to be known as Sole Owner stores, which was precisely what they weren’t, for without Saunders’ faithful backers they would have existed only in his mind. Saunders’ choice of a corporate title, however, was not designed to mislead the public; rather, it was his ironic way of reminding the world that, after the skinning Wall Street had given him, his name was about the only thing he still had a clear title to. How many Sole Owner customers—or governors of the Stock Exchange, for that matter—got the point is questionable. In any case, the new stores caught on so rapidly and did so well that Saunders leaped back up from bankruptcy to riches, and bought a million-dollar estate just outside Memphis. He also organized and underwrote a professional football team called the Sole Owner Tigers—an investment that paid off handsomely on the fall afternoons when he could hear cries of “Rah! Rah! Rah! Sole Owner! Sole Owner! Sole Owner!” ringing through the Memphis Stadium.
FOR the second time, Saunders’ glory was fleeting. The very first wave of the depression hit Sole Owner Stores such a crushing blow that in 1930 they went bankrupt, and he was broke again. But again he pulled himself together and survived the debacle. Finding backers, he planned a new chain of grocery stores, and thought up a name for it that was more outlandish, if possible, than either of its predecessors—Keedoozle. He never made another killing, however, or bought another million-dollar estate, though it was always clear that he expected to. His hopes were pinned on the Keedoozle, an electrically operated grocery store, and he spent the better part of the last twenty years of his life trying to perfect it. In a Keedoozle store, the merchandise was displayed behind glass panels, each with a slot beside it, like the food in an Automat. There the similarity ended, for, instead of inserting coins in the slot to open a panel and lift out a purchase, Keedoozle customers inserted a key that they were given on entering the store. Moreover, Saunders’ thinking had advanced far beyond the elementary stage of having the key open the panel; each time a Keedoozle key was inserted in a slot, the identity of the item selected was inscribed in code on a segment of recording tape embedded in the key itself, and simultaneously the item was automatically transferred to a conveyor belt that carried it to an exit gate at the front of the store. When a customer had finished his shopping, he would present his key to an attendant at the gate, who would decipher the tape and add up the bill. As soon as this was paid, the purchases would be catapulted into the customer’s arms, all bagged and wrapped, by a device at the end of the conveyor belt.
A couple of pilot Keedoozle stores were tried out—one in Memphis and the other in Chicago—but it was found that the machinery was too complex and expensive to compete with supermarket pushcarts. Undeterred, Saunders set to work on an even more intricate mechanism—the Foodelectric, which would do everything the Keedoozle could do and add up the bill as well. It will never corner the retail-store-equipment market, though, because it was still unfinished when Saunders died, in October, 1953, five years too soon for him to see the Bruce “corner”, which, in any case, he would have been fully entitled to scoff at as a mere squabble among ribbon clerks.
9
A Second Sort of Life
DURING Franklin D. Roosevelt’s Presidency, when Wall Street and Washington tended to be on cat-and-dog terms, perhaps no New Dealer other than That Man himself better typified the New Deal in the eyes of Wall Street than David Eli Lilienthal. The explanation of this estimate of him in southern Manhattan lay not in any specific anti-Wall Street acts of Lilienthal’s—indeed, the scattering of financiers, among them Wendell L. Willkie, who had personal dealings with him generally found him to be a reasonable sort of fellow—but in what he had come to symbolize through his association with the Tennessee Valley Authority, which, as a government-owned electric-power concern far larger than any private power corporation in the country, embodied Wall Street’s notion of galloping Socialism. Because Lilienthal was a conspicuous and vigorous member of the T.V.A.’s three-man board of directors from 1933 until 1941, and was its chairman from 1941 until 1946, the business community of that period, in his phrase, thought he “wore horns.” In 1946, he became the first chairman of the United States Atomic Energy Commission, and when he gave up that position, in February, 1950, at the age of fifty, the Times said in a news story that he had been “perhaps the most controversial figure in Washington since the end of the war.”
What has Lilienthal been up to in the years since he left the government? As a matter of public record, he has been up to a number of things, all of them, surprisingly, centered on Wall Street or on private business, or both. For one thing, Lilienthal is listed in any number of business compendiums as the co-founder and the chairman of the board of the Development & Resources Corporation. Several years ago, I phoned D. & R.’s offices, then at 50 Broadway, New York City, and discovered it to be a private firm—Wall Street-backed as well as, give or take a block, Wall Street-based—that provides managerial, technical, business, and planning services toward the development of natural resources abroad. That is to say, D. & R.—whose other co-founder, the late Gordon R. Clapp, was Lilienthal’s successor as T.V.A. chairman—is in the business of helping governments set up programs more or less similar to the T.V.A. Since its formation, in 1955, I learned, D. & R. had, at moderate but gratifying profit to itself, planned and managed the beginnings of a vast scheme for the reclamation of Khuzistan, an arid and poverty-stricken, though oil-rich, region of western Iran; advised the government of Italy on the development of its backward southern provinces; helped the Republic of Colombia set up a T.V.A.-like authority for its potentially fertile but flood-plagued Cauca Valley; and offered advice to Ghana on water supply, to the Iv
ory Coast on mineral development, and to Puerto Rico on electric power and atomic energy.
For another thing—and when I found out about this, it struck me as considerably more astonishing, on form, than D. & R.—Lilienthal has made an authentic fortune as a corporate officer and entrepreneur. In a proxy statement of the Minerals & Chemicals Corporation of America, dated June 24, 1960, that fell into my hands, I found Lilienthal listed as a director of the firm and the holder of 41,366 shares of its common stock. These shares at the time of my investigation were being traded on the New York Stock Exchange at something over twenty-five dollars each, and simple multiplication revealed that they represented a thumping sum by most men’s standards, certainly including those of a man who had spent most of his life on government wages, without the help of private resources.
And, for still another thing, in 1953 Harper & Brothers brought out Lilienthal’s third book, “Big Business: A New Era.” (His previous books were “T.V.A.: Democracy on the March” and “This I Do Believe,” which appeared in 1944 and 1949, respectively.) In “Big Business,” Lilienthal argues that not only the productive and distributive superiority of the United States but also its national security depends on industrial bigness; that we now have adequate public safeguards against abuses of big business, or know well enough how to fashion them as required; that big business does not tend to destroy small business, as is often supposed, but, rather, tends to promote it; and, finally, that a big-business society does not suppress individualism, as most intellectuals believe, but actually tends to encourage it by reducing poverty, disease, and physical insecurity and increasing the opportunities for leisure and travel. Fighting words, in short, from an old New Dealer.
Lilienthal is a man whose government career I, as a newspaper reader, had followed fairly closely. My interest in him as a government official had reached its peak in February, 1947, when, in answer to a fierce attack on him by his old enemy Senator Kenneth D. McKellar, of Tennessee, during Congressional hearings on his fitness for the A.E.C. job, he uttered a spontaneous statement of personal democratic faith that for many people still ranks as one of the most stirring attacks on what later came to be known as McCarthyism. (“One of the tenets of democracy that grow out of this central core of a belief that the individual comes first, that all men are the children of God and their personalities are therefore sacred,” Lilienthal said, among other things, “is a deep belief in civil liberties and their protection; and a repugnance to anyone who would steal from a human being that which is most precious to him, his good name, by imputing things to him, by innuendo, or by insinuation.”) The fragments of information I picked up about his new, private career left me confused. Wondering how Wall Street and business life had affected Lilienthal, and vice versa, in their belated rapprochement, I got in touch with him, and a day or so later, at his invitation, drove out to New Jersey to spend the afternoon with him.
LILIENTHAL and his wife, Helen Lamb Lilienthal, lived on Battle Road, in Princeton, where they had settled in 1957, after six years in New York City, at first in a house on Beekman Place and later in an apartment on Sutton Place. The Princeton house, which stands in a plot of less than an acre, is of Georgian brick with green shutters. Surrounded by other houses of its kind, the place is capacious yet anything but pretentious. Lilienthal, wearing gray slacks and a plaid sports shirt, met me at the front door. At just past sixty, he was a tall, trim man with a receding hairline, a slightly hawklike profile, and candid, piercing eyes. He led me into the living room, where he introduced Mrs. Lilienthal and then pointed out a couple of household treasures—a large Oriental rug in front of the fireplace, which he said was a gift from the Shah of Iran, and, hanging on the wall opposite the fireplace, a Chinese scroll of the late nineteenth century showing four rather roguish men, who, he told me, have a special meaning for him, since they are upper-middle-rank civil servants. Pointing to a particularly enigmatic-looking fellow, he added, with a smile, that he always thought of that one as his Oriental counterpart.
Mrs. Lilienthal went to get coffee, and while she was gone, I asked Lilienthal to tell me something of his post-government life, starting at the beginning. “All right,” he said. “The beginning: I left the A.E.C. for a number of reasons. In that kind of work, I feel, a fellow is highly expendable. If you stayed too long, you might find yourself placating industry or the military, or both—building up what would amount to an atomic pork barrel. Another thing—I wanted to be allowed to speak my mind more freely than I could as a government official. I felt I’d served my term. So I turned in my resignation in November, 1949, and it went into effect three months later. As for the timing, I resigned then because, for once, I wasn’t under fire. Originally, I’d planned to do it earlier in 1949, but then came the last Congressional attack on me—the time Hickenlooper, of Iowa, accused me of ‘incredible mismanagement.’” I noticed that Lilienthal did not smile in referring to the Hickenlooper affair. “I entered private life with both trepidation and relief,” he went on. “The trepidation was about my ability to make a living, and it was very real. Oh, I’d been a practicing lawyer as a young man, in Chicago, before going into government work, and made quite a lot of money at it, too. But now I didn’t want to practice law. And I was worried about what else I could do. I was so obsessed with the subject that I harped on it all the time, and my wife and my friends began to kid me. That Christmas of 1949, my wife gave me a beggar’s tin cup, and one of my friends gave me a guitar to go with it. The feeling of relief—well, that was a matter of personal privacy and freedom. As a private citizen, I wouldn’t have to be trailed around by hordes of security officers as I had been at the A.E.C. I wouldn’t have to answer the charges of Congressional committees. And, above all, I’d be able to talk freely to my wife again.”
Mrs. Lilienthal had returned with the coffee as her husband was talking, and now she sat down with us. She comes, I knew, from a family of pioneers who, over several generations, moved westward from New England to Ohio to Indiana to Oklahoma, where she was born. She seemed to me to look the part—that of a woman of dignity, patience, practicality, and gentle strength. “I can tell you that my husband’s resignation was a relief to me,” she said. “Before he went with the A.E.C., we’d always talked over all aspects of his work. When he took that job, we agreed between us that although we’d indulge in the discussion of personalities as freely as we pleased, he would never tell me anything about the work of the A.E.C. that I couldn’t read in the newspapers. It was a terrible constraint to be under.”
Lilienthal nodded. “I’d come home at night with some frightful experience in me,” he said. “No one who so much as touches the atom is ever quite the same again. Perhaps I’d have been in a series of conferences and listened to the kind of talk that many military and scientific men go in for—cities full of human beings referred to as ‘targets,’ and that sort of thing. I never got used to that impersonal jargon. I’d come home sick at heart. But I couldn’t talk about it to Helen. I wasn’t allowed to get it off my chest.”
“And now there wouldn’t be any more hearings,” Mrs. Lilienthal said. “Those terrible hearings! I’ll never forget one Washington cocktail party we went to, for our sins. My husband had been going through one of the endless series of Congressional hearings. A woman in a funny hat came gushing up to him and said something like ‘Oh, Mr. Lilienthal, I was so anxious to come to your hearings, but I just couldn’t make it. I’m so sorry. I just love hearings, don’t you?’”
Husband and wife looked at each other, and this time Lilienthal managed a grin.
LILIENTHAL seemed glad to get on to what happened next. At about the time his resignation became effective, he told me, he was approached by various men from Harvard representing the fields of history, public administration, and law, who asked him to accept an appointment to the faculty. But he decided he didn’t want to become a professor any more than he wanted to practice law. Within the next few weeks came offers from numerous law firms in New York
and Washington, and from some industrial companies. Reassured by these that he was not going to need the tin cup and guitar after all, Lilienthal, after mulling over the offers, finally turned them all down and settled, in May, 1950, for a part-time job as a consultant to the celebrated banking firm of Lazard Frères & Co., whose senior partner, André Meyer, he had met through Albert Lasker, a mutual friend. Lazard gave him an office in its headquarters at 44 Wall, but before he could do much consulting, he was off on a lecture tour across the United States, followed by a trip to Europe that summer, with his wife, on behalf of the late Collier’s magazine. The trip did not result in any articles, though, and on returning home in the fall he found it necessary to get back on a full-time income-producing basis; this he did by becoming a consultant to various other companies, among them the Carrier Corporation and the Radio Corporation of America. To Carrier he offered advice on managerial problems. For R.C.A., he worked on the question of color television, ultimately advising his client to concentrate on technical research rather than on law-court squabbles over patents; he also helped persuade the company to press its computer program and to stay out of the construction of atomic reactors. Early in 1951, he took another trip abroad for Collier’s—to India, Pakistan, Thailand, and Japan. This trip produced an article—published in Collier’s that August—in which he proposed a solution to the dispute between India and Pakistan over Kashmir and the headwaters of the Indus River. Lilienthal’s idea was that the tension between the two countries could best be lessened by a coöperative program to improve living conditions in the whole disputed area through economic development of the Indus Basin. Nine years later, largely through the financial backing and moral support of Eugene R. Black and the World Bank, the Lilienthal plan was essentially adopted, and an Indus treaty signed between India and Pakistan. But the immediate reaction to his article was general indifference, and Lilienthal, temporarily stymied and considerably disillusioned, once more settled down to the humbler problems of private business.
