WASHINGTON'S SHADOW GOVERNMENT
McCartney, James
WASHINGTON'S SHADOW GOVERNMENT by JAMES McCARTNEY In modern times the nation's capital has had, in every Administration, a shadow government, a power structure of lawyers and lobbyists that...
...If the Western Union Telegraph Company should be the recipient of a favorable ruling from the Federal Communications Commission, who could say that it was not won through Fortas' influence...
...Recently, Fortas and Oscar L. Chapman, former Secretary of the Interior in the Truman Administration, figured in an Interior Department oil import decision under which the Phillips Petroleum Company will be permitted to bring a substantial volume of petroleum products—beyond its import quota—into the United States...
...he may be invited to the White House for dinner...
...Dale Miller is not a lawyer...
...the Federal Republic of West Germany...
...The cost has been estimated at nearly $1 billion...
...Huge profits would have been possible for insiders if they knew of the value of the big strike, kept the knowledge to themselves and their friends, and bought company shares before their price soared...
...Johnson's disputed victory in the Senatorial Democratic primary in Texas in 1948...
...How can the public be assured that personal relationships are not playing a role in great governmental decisions...
...But the project has a fan, say the opponents...
...Fortas represented Puerto Rico, where Phillips promised to build a refining and petrochemical center...
...Many Washington law firms specialize in dealings with executive agencies not covered by the lobbying law...
...In the statement, company executives said that "preliminary indications [are] that more drilling will be required for proper evaluation of this prospect...
...Contacts made by lawyers or lobbyists for private clients do not have to be reported to anyone...
...the Committee for Hometown Television Inc...
...If lawyers turned lobbyists happen to be fighting against policies they helped to establish, that is the nature of the practice of law...
...As matters now stand, there is no procedure for arriving at such assurance...
...Other questions have been asked about the turnabout in the company's position between April 12 and April 16...
...The drilling done to date has not been conclusive . . ." Four days later, however, Texas -Gulf called a press conference in New York and said that a "major ore discovery" of about twenty-five million tons of copper, zinc, and silver had been made near Timmons...
...Johnson won, with the help of Fortas...
...The wise, or those who pretend to be wise, will say they understand...
...Texas" in Congress, the dean of the Texas lobbyists, and a close friend of the Johnsons for more than twenty years...
...the National Munitions Conference...
...Many another lawyer, and many another lobbyist, finds himself in a comparable position, although few, perhaps, may claim as close a relationship with the White House...
...The same question might be posed for any of the other clients of the firm...
...Some Texas Gulf stockholders have grumbled about the handling of the discovery news...
...When Mr...
...One result may well be to cast suspicion on perfectly legitimate and honest decisions...
...The problem grows out of the fact that much of the work of Fortas' law firm, like much of the work of many big Washington law firms, is involved in what may legitimately be called lobbying...
...If the Securites and Exchange Commission, after its lengthy investigation, should fail to provide a convincing explanation for the antics of Texas Gulf Sulphur officers, the Commission's action is bound to be questioned...
...What, if anything, Miller may have done to represent his client no one can say...
...Now, in the age of the Great Society, all that is changed...
...The list can go on...
...In Washington, private practice in the law usually means lobbying...
...No project the size of the Trinity River project could possibly be approved without the support of President Johnson...
...Indeed he may well be a part of the Establishment itself...
...If Braniff some time next year should get a favorable ruling from the Federal Aviation Agency, who could say whether it was Fortas' influence rather than a Fortas brief that produced the decision...
...Can he spend the morning battling with every technique he knows to get a favor for a client from some government agency, and then dispassionately act as a Presidential adviser in the afternoon...
...The Trinity River project, for Miller, would tie in neatly with aims and objectives of many of his other clients, such as the Intracoastal Canal Association of Louisiana and Texas and the Texas Gulf Sulphur Company...
...Can he resist the temptation to mention it when dining at the White House...
...As an illustration of the scope of the law firm's activities and the kinds of problems that might evolve, the Fortas firm is currently representing the Philip Morris Company, which has an obvious stake in the controversy over whether cigarets should be identified on the package as a menace to health...
...Merits of the project to the nation as a whole are difficult to weigh, but there is little question that the President's home state—and Miller's main client—would be the major beneficiaries...
...They are the brokers of the town...
...A lobbyist becomes accustomed to taking abuse and hard knocks as part of the trade...
...This picture of Washington today is not an exaggeration...
...In the technical, legal sense, within the narrow confines of the definition of a lobbyist as stated in the lobby registration law, all of this work cannot be called lobbying...
...He inherited the client from his father, the late Roy Miller...
...Said one top Democratic Congressional aide in a position to know the nation's needs—and politics—in river and harbor improvement: "We need money in Texas to help us there politically like we need a hole in the head...
...Fortas played a key role in the Walter Jenkins incident during last fall's election campaign...
...A lobbyist today need not feel ashamed of his trade...
...One writer has said that his "involvement in the President's life seems total...
...At the moment the Fortas firm is registered under the lobbying law as representing the National Retail Merchants Association, with specific interests in many executive departments...
...Men will wink...
...He recently acted as counsel for du Pont family interests in obtaining a reversal of a ruling from the Internal Revenue Service...
...It carries raw materials cheaply, and services the great basic industries of the state, including the burgeoning petrochemical industries developing in the Gulf...
...Another Presidential intimate, James H. Rowe Jr., is a registered lobbyist for the Haitian American Sugar Company...
...Dallas is 370 miles from the Gulf of Mexico, up the Trinity River from Galveston Bay...
...Senator Paul Douglas, Illinois Democrat, has reported that former Postmaster General J. Edward Day, of the original Kennedy Cabinet, has been representing the Inland Steel Company in its fight, along with other steel companies, against creation of a national park in the Dunes area at the southern end of Lake Michigan...
...American Molasses Company...
...The Intracoastal Canal is a barge canal, built and maintained largely at Federal expense, that stretches all the way from Florida to Mexico, just inland off the Gulf of Mexico...
...Other clients that the Fortas firm has represented in recent years have included the Western Union Telegraph Company...
...And it has been almost totally overlooked that Dale Miller, a close friend of President Johnson, is the lobbyist in Washington for Texas Gulf Sulphur...
...Authorization of the project this year, or in any other year of the Johnson Administration, would, at the very least, raise questions...
...When the case went to the U.S...
...Federated Department Stores, and the Wine Institute...
...Chapman represented Phillips...
...Miller hopes to win authorization of the project from Congress this year...
...They had their fling at public service and have gone into private practice...
...Since April, 1964, Texas Gulf has been one of the hottest stocks on the New York Stock Exchange because of a great ore strike near Timmons, Ontario...
...But it is a picture that invites some rather piquant questions, many of which are not being asked, at least publicly...
...On November 10, 1963, Texas Gulf drilled some samples from the ground near Timmons which testimony before a Canadian government inquiry indicated might constitute a major mineral discovery...
...Supreme Court, Mr...
...He and Fortas sought to keep the story of former White House aide Walter Jenkins out of the newspapers after Jenkins was arrested during the 1964 election campaign...
...The lawyer for the great corporation was assumed to be the enemy of government...
...The city, along with its neighbor, Fort Worth, has been seeking approval of a plan known as the Trinity River project to build a channel dredged to a twelve-foot depth, for barges all the way to the sea...
...He may be one of President Johnson's most influential advisers...
...Fortas recently was among the new nominees for the board of directors listed in a proposed overhaul of the board of Braniff Airways following acquisition of majority control of the firm by Great American Corporation, a Dallas, Texas, management firm...
...Now Washington is waiting, with jaundiced eye, for the approval of the project to become a reality...
...One who can is Clark Clifford, of the firm of Clifford and Miller...
...But to be named its chairman and lead the Inaugural Parade is sweet success indeed...
...But human nature being what it is, the public, the government, and, in the long run, even business are bound to suffer from a lobbying system that operates, with no controls, in secrecy and silence...
...This has to do with activities of the Texas Gulf Sulphur Company, of Newgulf, Texas, and New York City...
...Abe Fortas, of the firm of Arnold, Fortas, and Porter, has known Lyndon Johnson since he handled the delicate problem of Mr...
...In the days of the New Deal of Franklin D. Roosevelt, and even the Fair Deal of Harry S. Truman, it was commonly held that a prime function of government was to find ways to bring the "interests" under control...
...There was the white-haired Miller, smiling and waving...
...He is "Mr...
...While in the Cabinet, Day sat at the same table with Interior Secretary Stewart Udall, who was fighting with Douglas for the establishment of the park, officially proposed as a new "national seashore...
...He has represented the Dallas Chamber of Commerce, from a suite in Washington's plush Mayflower hotel, since 1946...
...One company using it is the Texas Gulf Sulphur Company...
...At the moment it is being considered by the Bureau of the Budget...
...He became Bobby Baker's lawyer when Baker, the top aide to Lyndon Johnson when he was in the Senate, was sued...
...The word was quietly passed...
...He is a professional lobbyist, and has been for years...
...He came by many of his other clients and his interests the same way...
...The river today is not navigable...
...Clifford was a member of the White House staff under President Truman and was a close adviser to President John F. Kennedy...
...They have been battling for years for a complex and expensive project aimed at no less a goal than a great gateway from Dallas to the sea...
...Questions have been asked, first, about the five month lag between the November borings and the April 12 announcement...
...Sometimes the canal almost touches the Gulf and at other times it is as much as forty miles inland...
...It is often flouted—and it completely ignores the reality of a government of many agencies subject to lobby pressures and White House influence...
...gation...
...To the average spokesman for a special interest it is hard enough, at least on occasion, to gain an audience with a busy Senator or Congressman...
...Johnson carried the state by a scant eighty-seven votes, which the opposition said were stolen...
...The lobby registration law, covering only Congress, is so weak it borders on being a farce...
...The problem is that there are few devices available to the public to monitor these relationships...
...Miller is involved in still another situation in which questions may be asked...
...They became friends...
...William Neil Roach, who was executive director of the Johnson Inaugural committee, is a lobbyist for the American Trucking Associations...
...For a fee, they maintain liaison between the government and the huge corporate interests that dominate the national economy...
...The lobbyist was a foe of the people...
...The reversal has saved members of the family—and cost the government—$56 million in taxes...
...Or, what of the lobbyist who represents a corporation that is the subject of a governmental investiJAMES McCARTNEY is a Washington correspondent for The Chicago Daily News...
...Consumer Mail Order Association...
...But maybe we're going to get this Trinity River thing pushed down our throats...
...The value of the ore found in the strike is now estimated at about $2 billion...
...Dale Miller and Dallas have bigger fish to fry...
...What has really happened in Washington that helps to explain part of the problem is that many of the young lawyers who provided the crusading zeal for the New and Fair Deals, and even the New Frontier, have grown older...
...Parts of it dry up during periods of extended drought...
...When the April 16 announcement was made, it sent the value of the stock skyrocketing...
...Miller was able to get an audience with President Johnson for a group of Dallas businessmen to discuss the Trinity River project, among other things, on the day before the President delivered his State of the Union message...
...One of the firm's main functions, one of its reasons for being, is to represent clients who have troubles or business with the government...
...Its purpose is to protect barge traffic from rough waters of the Gulf...
...The positions of Fortas and Miller in the scheme of things in the Johnson Administration are merely illustrative of a widely prevailing state of affairs...
...Miller is known basically for his efforts on behalf of the city of Dallas...
...Critics of the project, led by the Association of American Railroads, have argued that the project will be much more expensive than estimates by the Army Corps of Engineers have indicated...
...Many a lobbyist would be happy to gain the status of an appointment to the Inaugural committee...
...They believe, in essence, that the Trinity River project is not necessary and would be a waste of good government money...
...They argue that the Panama Canal, built only fifty years ago, is already outdated...
...Securities and Exchange Commission has been investigating price movements in Texas Gulf stock...
...It has not escaped the attention of government agency officials and others fighting to have cigarets labeled as dangerous that President Johnson failed to mention the cigaret problem in his health message to Congress...
...Many decisions —such as the tax decision involving the du Ponts—are made in secret...
...They say, for example, that the $1 billion figure is based on a plan to amortize the debt over a 100 year period—until the year 2070...
...It rose to about $30 a share by the time of the varying announcements the following April and is now selling for about $68 a share...
...A spokesman for the Commission, when asked whether Miller had sought to argue the company's case, insisted that he didn't know who Miller was —even though Miller's identification with Texas Gulf Sulphur appeared on all of Washington's society pages at the time of the Inaugural...
...Fortas has often been present at the White House at moments of crisis in the Johnson Administration...
...It has been widely publicized, at least in the financial press, that the Ontario Royal Commission and other Canadian agencies have been investigating wild stock speculations that grew out of this great ore strike...
...Johnson was able to find ninety minutes to spend with the group, and later took them on a stroll around the White House grounds...
...The story is a fascinating tale of high finance and wild speculation...
...Announcement of a new $22 million Federal building in Dallas raised a few eyebrows following last November's election, but has been explained as representing, as much as anything, the election of a Democrat, Representative Earle Cabell, to replace conservative Republican Bruce Alger as spokesman for Dallas in Congress...
...The stock was selling at about $17 a share at the time of the November, 1963, borings...
...Simon 8c Schuster...
...WASHINGTON'S SHADOW GOVERNMENT by JAMES McCARTNEY In modern times the nation's capital has had, in every Administration, a shadow government, a power structure of lawyers and lobbyists that functions just beyond the public view...
...It was not until five months later, however, on April 12, 1964, that the company issued a statement in New York that has since excited wide controversy...
...They are also well aware of Fortas' role in representing Philip Morris...
...The question for some obscure Congressmen at least, is hardly whether Miller can get an appointment with them...
...But on Pennsylvania Avenue on January 20, on the occasion of Lyndon B. Johnson's Inaugural, the first convertible to come rolling by, at the very head of the parade, carried a sign on the side that read: "Dale Miller, Inaugural Committee Chairman...
...The canal is a major artery in the economy of Texas...
...A lawyer for a private interest is no longer an enemy of the Federal government...
...The problem can be illustrated by the dilemmas in the lives and work of two of the President's closest friends, lawyer Abe Fortas and lobbyist Dale Miller...
...One of the questions is whether a man can represent private interests in earning a living, and uphold the public interest when talking to the President...
...Johnson became Vice President in 1961, they say, he let it be known that the Trinity River project was on his personal agenda...
...The question is more likely to be whether they can get an appointment with Miller...
...A detailed examination of this transaction starts on Page 29 of this issue.—The Editors...
...It ties together all of the state's great seaport cities including Corpus Christi, Galveston, Houston, and Port Arthur...
...Lever Brothers Company, the soap-makers...
...These are the men who make the deals and the compromises that influence the course of government policy, and fatten the profits of their clients...
...But that is only because of the limitations of the law, which covers—and not adequately— only activities relating to Congress...
...It has not been nearly so widely heralded that the U.S...
...and an exterior wood manufacturer named Howard F. Knipp...
...The Securities and Exchange Commission does hot make public the representations of those who appeal to it or attempt to influence its actions...
...The estimate of the number of tons of ore in the Timmons area has since doubled from the figure announced on April 16...
...Of Miller the question might be asked: Just how successful can one lobbyist be...
...The change in the role of the lobbyist is an integral part of the new kind of Administration in the White House, with its novel view of what constitutes proper relationships between government and business, and between government officials and businessmen...
Vol. 29 • May 1965 • No. 5
