-Caveat Lector-
an excerpt from:
The Plot to Seize the White House
Jules Archer(C)1973
Hawthorne Books, Inc.
New York, NY
-----
{Some of his testimony was not released in the official record of the
hearings, for reasons that will be discussed later, but was nevertheless
ferreted out, copied, and made public by reporter John L. Spivak. This
censored testimony is indicated by the symbol + to distinguish it from the
official testimony eventually released by the McCormack-Dickstein Committee.
The same was true of testimony given by reporter Paul Comly French, who
followed Butler as a witness, and the same symbol (+) indicates the censored
portions.* [* The reader who wishes to examine the official testimony is
referred to the government report, Investigation of Nazi Propaganda Activities
and Investigation of Certain Other Propaganda Activities: Public Hearings
Before the Special Committee on Un-American Activities, House of
Representatives, Seventy-third Congress, Second Session, at Washington, D.C.,
December 29, 1934. Hearings No. 73-D.C.-6, Part 1. Extracts of the censored
testimony are revealed in the books A Man in His Time, by John L. Spivak, and
2000 Americans, by George Seldes.]}
-----
5
After Butler had completed his testimony, Paul Comly French took the witness
chair to report on his own investigation of the plot, in which a candid two-
hour conversation with MacGuire at the latter's office figured prominently.
Describing these talks on the premises of Grayson M.-P. Murphy and Company,
French verified every allegation about the plot the general had attributed to
MacGuire. In addition French reported the more open statements MacGuire had
made to him about the nature of the conspiracy and how it would work. More
frank with French, apparently, than he had dared to be with the general,
MacGuire made little attempt to disguise the Fascist nature of the proposed
putsch with euphemistic phrases about "supporting the President."
FRENCH: We need a Fascist government in this country, he insisted, to save the
Nation from the Communists who want to tear it down and wreck all that we have
built in America. The only men who have the patriotism to do it are the
soldiers and Smedley Butler is the ideal leader. He could organize a million
men overnight.
During the conversation be told me he had been in Italy and Germany during the
summer of 1934 and the spring of 1934 and had made an intensive study of the
background of the Nazi and Fascist movements and how the veterans had played a
part in them. He said he had obtained enough information on the Fascist and
Nazi movements and of the part played by the veterans, to properly set up one
in this country.
He emphasized throughout his conversation with me that the whole thing was
tremendously patriotic, that it was saving the Nation from Communists, and
that the men they deal with have that crackbrained idea that the Communists
are going to take it apart. He said the only safeguard would be the soldiers.
At first he suggested that the General organize this outfit himself and ask a
dollar a year dues from everybody. We discussed that, and then he came around
to the point of getting outside financial funds, and he said that it would not
be any trouble to raise a million dollars.
French's use of the phrase "crackbrained idea" to describe the notion by
financiers and captains of industry that the country needed to be saved from
communism was obviously his own, and not MacGuire's, expression.
Censored in French's testimony was his revelation of the sources to which
MacGuire had said that he could turn for the funds to finance the veterans'
army.
+ FRENCH: He said he could go to John W. Davis [attorney for J. P. Morgan and
Company] or Perkins of the National City Bank, and any number of persons to
get it.
Of course, that may or may not mean anything. That is, his reference to John
W. Davis and Perkins of-the National City Bank.
French testified that MacGuire had sought to impress him by indicating high-
level support for the conspiracy from important movers and shakers of the
American Legion.
FRENCH: He then pushed a letter across the desk and said that it was from
Louis Johnson, a former national commander of the American Legion.
CHAIRMAN: Did he show you the letter?
FRENCH: I did not read it. He just passed it over so I could see it, but be
did not show it to me. He said that he had discussed the matter with him along
the lines of what we were now discussing, and I took it to mean that he had
talked of this Fascist proposition with Johnson, and Johnson was in sympathy
with it.
During the conversation he also mentioned Henry Stevens, of Warsaw, N.C., a
former national commander of the American Legion, and said that he was
interested in the program. Several times be brought in the names of various
former national commanders of the American Legion, to give me the impression
that, whether justly or unjustly, a group in the American Legion were actively
interested in this proposition.
CHAIRMAN: In other words, he mentioned a lot of prominent names; and whether
they are interested or not, you do not know, except that he seemed to try to
convey to you that they were, to impress on you the significance of this
movement?
FRENCH: That is precisely the impression I gained from him.
As MacGuire had grown increasingly comfortable with him, French testified, the
plotter had grown candid and enthusiastic about the Fascist rewards that would
follow seizure of the White House. French's use of the word "brilliant" in the
following portion of testimony was obviously sarcastic.
FRENCH: He had a very brilliant solution of the unemployment situation. He
said that Roosevelt had muffed it terrifically, but that he had the plan. He
had seen it in Europe. It was a plan that Hitler had used in putting all of
the unemployed in labor camps or barracks-enforced labor. That would solve it
overnight, and be said that when they got into power, that is what they would
do; that that was the ideal plan.
He had another suggestion to register all persons all over the country, like
they do in Europe. He said that would stop a lot of these Communist agitators
who were running around the country.
He said that a crash was inevitable and was due to come when bonds reached 5
percent. He said that the soldiers must prepare to save the Nation.
If Roosevelt went along with the dictatorship as the King had done in Italy,
MacGuire had suggested, Butler could have the proposed labor camps put under
his own control.
+ FRENCH: . . . be suggested that Roosevelt would be in sympathy with us and
proposed the idea that Butler would he named as the head of the C.C.C.
[Civilian Conservation Corps] camps by the President as a means of building up
the organization....
French then testified that MacGuire had told him the plotters could obtain
arms and equipment from the Remington Arms Company, on credit through the Du
Ponts. His testimony also implicated the American Liberty League.
+ FRENCH: I do not think at that time he mentioned the connection of Du Pouts
with the American Liberty League, but he skirted all around it. That is, I do
not think he mentioned the Liberty League, but be skirted all around the idea
that that was the back door; one of the Du Ponts is on the board of directors
of the American Liberty League and they own a controlling interest in the
Remington Arms Co. . . . He said the General would not have any trouble
enlisting 500,000 men.
It was because MacGuire saw the general as the indispensable man of the
putsch, French testified, that he persisted in his efforts to win Butler's
adherence to the scheme.
FRENCH: When I left him he said that he planned to get in touch with the
general and again try to persuade him to accept the leadership of this
organization; that he was going to Miami in a couple of weeks for the national
convention to do a little work.
CHAIRMAN: To beat the bonus?
FRENCH: Yes.
CHAIRMAN: I thought he was for the bonus.
FRENCH: He was at first.
BUTLER (interposing): He wants it paid in gold. Clark told me that he had been
for the bonus or that he would be for the bonus if we could get the gold
standard restored.
FRENCH: Then he said he would be in Miami. I told him that the general was
going out on a rather lengthy speaking tour and did not know how to get to
him. He said that he would either see him before be went to Miami or, if be
could not, after he came back from Miami. But he did not see him and in a
couple of days the general went out West.
Then I went back to see MacGuire on the 27th of September and talked to him
for only a few minutes this time. In the meantime I had tried to get in touch
with him once when I was in New York, but he was then in Miami and could not.
At this time he said that he was extremely sorry that he could not get to
Newtown Square [Butler's hometown], but hoped to do so soon; that things were
moving nicely. Everything is coming our way, is the way he expressed it.
That same afternoon the committee grilled Jerry MacGuire, who had also been
summoned to testify at the executive session. MacGuire, who earned only $150 a
week as a bond salesman, contradicted himself on the amount of money he had
received from sponsors and what be had done with it. He denied Butler's
allegation that he had thrown eighteen thousand-dollar bills on the bed at the
Newark hotel during the 29th Division convention to bribe Butler into going to
the Legion convention in Chicago.
But he could not explain what he had done with at least thirty thousand in
letters of credit, funds advanced to him by either Clark or Clark's attorney,
Albert Grant Christmas, and which MacGuire had had with him at the Legion
convention in Chicago the following October, at which he had been both a
delegate and a member of the "distinguished guest committee."
The McCormack-Dickstein Committee found five significant facts that lent
validity to Butler's testimony. Clark, who wanted the Legion to pass a gold-
standard resolution, had given MacGuire those funds. In the long-distance call
Clark had allegedly made to Chicago while Butler was listening, he had
instructed MacGuire, "You can put this thing across alone. You've got $45,000.
You can send those telegrams." MacGuire could not explain how he had spent
those funds. But telegrams had, indeed, flooded the convention, and the Legion
had passed the resolution.
Corroboration of Butler's testimony about MacGuire's mission in Europe was
borne out by the committee's finding that he had spent large sums of money on
that trip to study Fascist movements in Italy, Germany, and France. The
committee found, too, that he and Clark had handled large sums of money for
various organizations, that he had been active in organizations mentioned by
Butler, and that he had acted as cashier for one organization. His accounts of
some of these financial transactions failed to satisfy the committee, and he
was curtly instructed to reappear the following day for further questioning.
Interviewed by reporters afterward, MacGuire declared that he was a personal
friend of General Butler's and had last seen him six months earlier when he
had gone to Philadelphia to sell some bonds. They had talked about an adequate
military force for the nation, MacGuire insisted, and about world affairs in
general, but he denied ever discussing a Fascist army or movement. A little
desperately MacGuire suggested that "General Butler must be seeking
publicity," and called the general's testimony "a pacifist stunt." His
attorney, Norman L. Marks, called it "a joke and a publicity stunt for General
Butler."
Smedley Butler's reputation as an honest patriot made what he had testified to
under oath impossible for the press to ignore. On November 21, 1934, in the
center of its front page, The New York Times carried a two-column headline:
Gen. Butler Bares 'Fascist Plot'
To Seize Government by Force
Says Bond Salesman, as Representative of Wall St. Group, Asked
Him to Lead Army Of 500,000 in March on Capital-Those
Named Make Angry Denials-Dickstein Gets Charge
Reading the Time's account of the secret hearings, Butler was struck by a
unique arrangement of the facts in the story. Instead of beginning with a full
account of his charges, there was only a brief paragraph restating the facts
in the headline. This was followed by a whole string of denials, or ridicule
of the charges, by prominent people implicated. Extensive space was given to
their attempts to brand Butler a liar or lunatic. Only at the tail of the
story, buried inside the paper, did the Times wind up its account with a few
brief paragraphs mentioning some of his allegations.
Many papers that picked up the story dropped the tail carrying even those
cursory details of the plot. Newspaper publishers had little reason to be fond
of the firebrand general who, in his speech to veterans in Atlanta almost a
year earlier, had warned them not to believe the capitalist-controlled press,
which, Butler charged, suppressed facts unfavorable to America's powerful
corporations.
The New York Times did note, however, that Butler had told friends in
Philadelphia that General Hugh S. Johnson, former N.R.A. administrator, had
been among those slated for the role of dictator if Butler turned it down and
that J. P. Morgan and Company and Grayson M.-P. Murphy and Company were both
involved in the plot.
"It's a joke--a publicity stunt," Jerry MacGuire was quoted as insisting. "I
know nothing about it. The matter is made up out of whole cloth. I deny the
story completely."
General Johnson growled, "He had better be pretty damn careful. Nobody said a
word to me about anything of this kind, and if they did I'd throw them out the
window. I know nothing about it."
Thomas W. Lamont, partner in J. P. Morgan and Company, gave his comment:
"Perfect moonshine! Too unutterably ridiculous to comment upon!" J. P. Morgan
himself, just back from Europe, had nothing to say.
"A fantasy!" scoffed Colonel Grayson M.-P. Murphy. "I can't imagine how anyone
could produce it or any sane person believe it. It is absolutely false so far
as it relates to me and my firm, and I don't believe there is a word of truth
in it with respect to Mr. MacGuire."
Colonel Murphy specifically denied to reporters that he had financed any
Fascist plot and called the statement that be had made out a check for General
Butler's Chicago expenses "an absolute lie." He declared that he did not know
General Butler and had never heard of the reputed Fascist movement until the
charges had been published. He insisted that in 1932 he had voted for
President Roosevelt, the target of the alleged plot.
Asked about these denials, Butler snorted to a New York Times reporter, "Hell,
you're not surprised they deny it, are you? What they have to say they'll say
before the committee." He wanted them under oath, as he had been.
In Washington General Douglas MacArthur, Chief of Staff, was unavailable for
comment because of a real or a diplomatic "heavy cold." His aides, however,
expressed amazement and amusement that MacArthur had been named by Butler as
an alternate choice of the plotters for dictator if Butler persisted in
refusing the offer.
"All the principals in the case," George Seldes noted in his book Facts and
Fascism, "were American Legion officials and financial backers."
Secretary of War George H. Dern, Secretary of the Navy Claude A. Swanson, and
a large number of senators and congressmen urged the McCormack-Dickstein
Committee to get to the bottom of the conspiracy.
"We are going to make a searching investigation of the evidence submitted by
General Butler," McCormack announced. "Our original information came from
several different sources. General Butler was not the first source of our
information.... We have been in possession of certain information for about
five weeks and have been investigating it. We will call all the men mentioned
in the story, although Mr. Clark is reported to be in Europe."
"From present indications," declared Dickstein, "Butler has the evidence. He's
not going to make any serious charges unless he has something to back them up.
We'll have the men here with bigger names than his." He added that Butler had
substantiated most of the statements attributed to him and had denied none.
Both McCormack and Dickstein emphasized that the general had repulsed all
proposals from the Fascist group.
Dickstein indicated that about sixteen persons mentioned to the committee by
Butler would be subpoenaed and that an open hearing might be held within a
week.
Returning from Washington, Butler was besieged by reporters at his home in
Newtown Square.
"My name has been used all around the country by organizations," he told them.
"They'd get some vets and say, 'See, we have Butler with us.' They were using
me. The investigators who have been running this thing down found my name
popping up everywhere, so they wanted to know what I knew about it-and I'm not
the only man in this thing."
Next day Dr. W. D. Brooks, of Jackson, Michigan, wired the President:
Very obviously Wall St. plans to take over the U.S. Govt. if Hoover re-
elected. Very obviously Butler is telling the truth. I have been looking for
just this attempt at a Wall St. coup if your policies looked like succeeding.
Wall St. is the enemy of our govt. and Butler is giving it to you
straightdon't doubt that for a minute.
The writer was unable to ascertain the identity of Dr. Brooks, but apparently
his opinion carried some weight at the White House, because Louis Howe
referred his wire to Attorney General Homer S. Cummings "for acknowledgment
and consideration." A demand for prosecution of the conspirators came from
many V.F.W. posts all over the country, which passed resolutions praising
Butler for exposing the plotters.
Typical was the resolution of Philadelphia Post 37 on November 2.2, 1934:
Whereas Major General Smedley D. Butler has again exhibited his patriotism,
sterling integrity and incorruptible character by exposing a sinister clique
of adventurers who would undermine and destroy our form of government, and
whereas such treasonable activities by men of money and of influence are more
dangerous to our institutions than radical groups in our midst, therefore be
it resolved ... that it commend General Butler for his patriotic spirit and
hereby expresses its deep gratitude for his great service to our country. And
be it further resolved that the Clair Post hereby respectfully requests the
Attorney General of the United States to take proper legal action against all
guilty parties involved.
If the press seemed overeager to emphasize denials of Butler's charges, the
people of grass-roots America were far readier to believe the man who had
exposed the plot. Letters of encouragement poured in from all over the
country. One Nebraska woman wrote him:
It is heartening to find a man who has the courage to fight that Octopus, Wall
St. More power to you. There are millions of honest people in the United
States who applaud you and would follow you heart & soul. Read of MacNider's
name being linked with the case. Heard him speak before a woman's club in
Omaha. Sized him up as being that kind of tripe. Here's hoping you expose
these traitors to a showdown. Yours for justice. . . .
Jerry MacGuire returned as a witness for a second day of secret grilling by
the McCormack-Dickstein Committee. Again he denied Butler's charges that he
had approached the general on behalf of a plot to establish a Fascist
dictatorship.
He testified that he had received thirty thousand dollars from Robert Sterling
Clark to be deposited in the Hanover Trust Company to the credit of "The
Committee for a Sound Dollar and Sound Currency, Inc." He and his backers had
only wanted to interest Butler in that committee, MacGuire insisted, because
as an important and popular public figure the general could command attention
for their movement. They wanted to give him the opportunity to "make a little
money" in the process.
Although Clark, his attorney A. G. Christmas, Walter E. Frew, and others were
behind the Committee for a Sound Dollar and Sound Currency, their names had
been carefully omitted from its records. MacGuire testified that as far as he
knew, Clark had never had any interest in a Fascist organization. But the
McCormack-Dickstein Committee located letters from MacGuire written from
Europe to Clark and Christmas that proved otherwise.
To many questions thrown at him MacGuire answered evasively, "It -is too far
back,", or "I cannot recall." At the conclusion of his testimony Dickstein
told reporters that MacGuire was "hanging himself" by contradictions in his
story and by forced admissions made during his testimony. When this opinion
was quoted in a few evening newspapers, Dickstein observed that he had meant
it to be "off the -record."
Norman L. Marks, the attorney who had accompanied MacGuire at the secret
hearings, told reporters that MacGuire had denied ever having had any
connection with any Fascist organization of any sort; that he had ever been
the "cashier" for any Fascist group; or that he had gone to Europe to study
the Fascist movement. MacGuire's European trip, Marks alleged, had been solely
for purposes of private business.
McCormack declared that all information about the testimony would be withheld
because it had been given in closed executive session. But the fact that the
committee regarded the testimony as important, he added, was shown by the
decision to recall MacGuire for further questioning. Despite Dickstein's
earlier statement that sixteen people named by Butler would be subpoenaed,
McCormack said that the committee had not yet decided whether to call
additional witnesses. Noting that the most important witness, apart from
MacGuire, was Robert S. Clark, "a wealthy New Yorker with offices in the Stock
Exchange Building," who was abroad, McCormack indicated that if the facts
warranted, a public hearing would be held. Leaders of important organizations
like the American Legion and the V.F.W. would then be invited to appear before
the committee.
The Associated Press reported from Indianapolis that banker Frank N. Belgrano,
Jr., national commander of the Legion, had denied that the Legion was involved
"in the slightest degree" in any plot to supply an army for a "march on
Washington." Highly placed Legion officials in Washington also characterized
as "horsefeathers" a rumor that a group of "big-business men" had promised the
Legion payment of adjusted service certificates, in return for a pledge to
support the Fascist movement.
Louis Johnson, former Legion national commander, declared in Fairmont, West
Virginia, that he could not recall having written the letter to Jerry
MacGuire, promising to see him about the Fascist army plan, that MacGuire had
shown briefly to Paul Comly French. If he had written such a letter, Johnson
insisted, it would show that he and the Legion were unalterably opposed to any
dictatorship.
On November 22 the Associated Press struck a low blow at Butler by getting
Mayor Fiorello LaGuardia, of New York, to express an opinion of the conspiracy
based on what he had read about it in the press. The AP ran this "news item"
under the headline "COCKTAIL PUTSCH," MAYOR SAYS:
Mayor LaGuardia of New York laughingly described today the charges of General
Smedley D. Butler that New York brokers suggested he lead an army Of 500,000
exservice men on Washington as "a cocktail putsch." The Mayor indicated he
believed that some one at a party had suggested the idea to the ex-marine as a
joke.
Reading the press treatment of the scanty disclosures that had leaked out of
the closed hearing, Butler was not surprised by the attempts to minimize and
ridicule his exposure of the conspiracy. He had expected to be pilloried for
his audacity in pinning a traitors' label on powerful American interests. He
hoped, however, that the press would eventually be compelled to print the
whole story of the plot as it had unfolded to him, when he testified at a
public hearing along with French's corroboration.
The committee would surely have to subpoena all the people who were
implicated, in one way or another, to testify at that open meeting under oath.
Fresh support for Butler's expose came from Van Zandt, who revealed to the
press that he, too, had been approached by "agents of Wall Street" to 'lead a
Fascist dictatorship in the United States under the guise of a "Veterans
Organization."
He revealed that Butler had informed him about the plotters' solicitation of
the general two months earlier and had warned him that he, too, would be
contacted by them at the V.F.W. convention in Louisville, Kentucky. Van Zandt
said he had asked Butler the purpose of the organization and the general had
replied that it sought to return the American dollar to the gold standard and,
in MacGuire's words, "to get rid of this fellow in the White House."
In addition to Butler and himself, Van Zandt told reporters, MacArthur,
Colonel Theodore Roosevelt, Jr., and former Legion Commander Hanford MacNider
had recently been sounded out on their interest in leading the proposed
Fascist veterans organization. He also charged that MacGuire had spent months
in Europe studying Fascist organizations as models for an American one.
Theodore Roosevelt, Jr., decried as "ridiculous" the idea that he could be
used to wrest the powers of the Presidency away from his fourth cousin,
Franklin D. Roosevelt.
McCormack declared that the committee was continuing to give serious
consideration to General Butler's charges and might call Van Zandt to testify
on the proposals made to him and others he had named. MacGuire would be called
before the committee again in executive session, he announced, for scrutiny of
his bank accounts and records. But McCormack indicated that he intended to
keep the scope of the investigation circumscribed by legal considerations.
"We don't intend to drag in names that come to us through rumors," he told
reporters. "If investigation discloses there is sufficient reason to subpoena
witnesses, we will do so. Simply because someone mentions the name of Mr.
Lamont or General Johnson is not sufficient to ask them to appear before the
committee."
Meanwhile the focus of the committee's interest was shifted when it turned its
attention to investigating charges that some left-wing unions had used a
three-million-dollar fund to "foment and carry on strikes." The New York Times
ran headlines reading "Reds Fund Activity in Fur Industry" and "Red Union
Funds Traced at Hearing." Buried in third-rank subheads, and in the body of
the story, was further information about the Fascist plot.
A news dispatch from Paris reported that Robert Sterling Clark was sending a
lawyer to New York to answer charges made by Butler and "clear the matter up."
Clark declared himself bewildered by the mention of his name and said he would
send the lawyer "if the whole affair isn't relegated to the funny papers by
Sunday."
"MacGuire went to Europe for me, but his visit had nothing to do with
politics," he insisted. "He visited France, Italy and Germany and was in Paris
in February of this year. He spent four months on the Continent. His trip was
made for the purposes of investigating the financial situation, the
possibilities of monetary stabilization and commercial trends."
When reporters showed him Van Zandt's accusation that MacGuire had returned to
the United States with copious data for setting up an American Fascist regime,
he exclaimed, "My God, what is back of all this? I saw all of MacGuire's
reports. I cannot imagine him doing anything else on the side."
Although he was on vacation in Paris, Clark declared, he was ready to return
to testify if the committee summoned him.
10
MacGuire showed up a third time for interrogation by the committee, this time
with the bankbooks, canceled checks, and other financial records he was
ordered to produce. Before entering the committee room accompanied by his
counsel, he asked permission to read to the committee a cablegram he had
received from Albert Grant Christmas, Clark's lawyer, in Paris:
Read this wire when you testify. Reports of the Butler testimony in Paris
outrageous. If reports are correct, my opinion is that a most serious libel
has been committed. I am returning at once to testify as to our anti-inflation
activities.
MacGuire now testified that on September 24, 1933, on the date Butler had said
he was approached by MacGuire in the Newark hotel and offered eighteen
thousand-dollar bills, MacGuire had been in Chicago. He claimed to have
registered at the Palmer House on September 21, remaining in Chicago until
October 8, so that he could not have met Butler in Newark on the twenty-
fourth.
But committee investigators found that he had indeed called upon Butler that
day and had had available at least sixteen thousand dollars, largely in
thousand-dollar bills. Unless MacGuire had shown them to him, Butler could not
possibly have known about them, lending strong verification to the general's
charge that they had been tossed on his bed as a bribe.
MacGuire produced the bank accounts of the Committee for a Sound Dollar and
Sound Currency, Inc., of which he was an official, and whose purpose he
described as "opposing monetary inflation in the United States." He and his
lawyer now insisted that the only discussions MacGuire had had with Butler
concerned financial backing for a contracting concern.
MacGuire reluctantly admitted receiving $75,000 from Clark for an "unexplained
purpose," the McCormack-Dickstein Committee report later noted, while working
on a drawing account of $432 a month. This $75,000 was in addition to $30,000
he had also received from Walter E. Frew, of the Corn Exchange Bank, for the
Committee for a Sound Dollar and Sound Currency, Inc. "Whether there was more,
and how much more," said the report, the [McCormack-Dickstein] Committee does
not yet know."
MacGuire admitted spending almost $8,000 on the trip to Europe, ostensibly to
buy bonds, but the investigators noted the trip had resulted in detailed
reports to MacGuire's backers on various Fascist organizations abroad.
Although he still denied having tossed the eighteen thousanddollar bills on
Butler's bed in the Newark hotel, the committee found bank records showing he
had bought letters of credit six days later from Central Hanover Bank, paying
for them with thirteen thousand-dollar bills.
The testimony of MacGuire under oath flatly contradicted everything Butler had
testified to. The McCormack-Dickstein Committee was left with no other option
than to conclude either that Butler was lying, in which case the whole plot
was a fabrication or fantasy, or that MacGuire was lying, in which case
Butler's charges were true, and the dangerous conspiracy of which he warned
was a reality.
McCORMACK: Did you leave a speech with him--a speech that he was to make to
the convention if he went out there?
MacGUIRE: No, sir.
McCORMACK: Was anything said about weakening the influence of the
administration with the soldiers?
MacGUIRE: No, sir; I do not believe the administration was mentioned, as far
as President Roosevelt or anybody down there are concerned....
McCORMACK: Was there some talk about his going out as an individual
Legionnaire and having two or three hundred Legionnaires go out to Chicago,
too?
MacGUIRE: No, sir....
McCORMACK: At any time did you take out a bank book and show him deposits in
it?
MacGUIRE: No, sir. . . .
McCORMACK: Did he at any time ask you where you got the money?
MacGUIRE: I never had any money, and he never asked me if I had any....
McCORMACK: Did you know that Mr. Clark had a personal talk with General
Butler?
MacGUIRE: It seems to me that he mentioned it to me, but I am not sure. . . .
McCORMACK: Did you know that Mr. Clark talked with him about going to the
convention?
MacGUIRE: No, sir; I do not....
McCORMACK: Did Mr. Clark call you up in Chicago at any time?
MacGUIRE: Mr. Clark? No, sir....
McCORMACK: Did he ever call you up in Chicago from General Butler's home?
MacGUIRE: No, sir; to my recollection he did not. . . .
McCORMACK: Did you tell him [Butler] at that time that you went abroad to
study the part that the veterans played abroad in the set-up of the
governments of the countries abroad?
MacGUIRE: No, sir....
McCORMACK: Did you talk with him about the forming of an organization of that
kind here?
MacGUIRE: No, sir....
McCORMACK: You previously testified that you only had one transaction in the
swapping of checks with Christmas [Clark's attorney] of $20,000 and until
later, when you paid him. back the balance?
MacGUIRE: No; I believe that was paid back to Christmas in cash.
McCORMACK: What have you got to show that?
MacGUIRE: I haven't got anything to show it.
McCORMACK: Did you receive a receipt from Christmas?
MacGUIRE: No, sir; not necessarily; as far as that goes, he is an old friend
of mine. . . .
At this point McCormack produced subpoenaed bank records showing that MacGUIRE
had cashed letters of credit in the amount Of $30,300, prior to the Legion
convention in Chicago. MacGUIRE claimed that this money was meant to allow him
to buy bonds in case he came across a good buy.
McCORMACK: What did you do with that $30,300 in Chicago?
MacGUIRE: I kept that money in cash and put it in a safe deposit box with the
First National Bank....
McCORMACK: What became of that money?
MacGUIRE: That money was brought back and returned to Mr. Christmas.
McCORMACK: In cash?
MacGUIRE: Yes.
McCORMACK: When did you return this $30,300 to Mr. Christmas?
MacGUIRE: I do not remember the date....
McCORMACK: Did you get a receipt for it?
MacGUIRE: No, I did not get a receipt for it....
McCORMACK: Let me ask you this: why should you have cashed the letters of
credit in Chicago and -put that money in a safe deposit box?
MacGUIRE: Because I felt that if I had a chance to buy the bonds I could buy
them right off for cash.
McCORMACK: Wouldn't letters of credit be accepted just as cash?
MacGUIRE: They probably would.
McCORMACK: Wouldn't they be safer than cash on your person?
MacGUIRE: They probably would, yes; but there is no objection to getting the
cash, is there? ...
McCORMACK: Did you buy any bonds?
MacGUIRE: No, sir.
McCORMACK: What bonds did you want to buy? ...
MacGUIRE: I think Chicago Sanitary District 4's
McCORMACK: Whom did you talk to about buying the Chicago Sanitary District
4's?
MacGUIRE: I did not talk to anybody.
McCORMACK: Whom did you speak to about it?
MacGUIRE: I didn't speak to anybody. . . .
McCormack next turned to subpoenaed reports that MacGuire had sent back from
Europe and cited the one he had sent back praising the Croix de Feu as a model
veterans organization. He also read out another report MacGuire had submitted
to his backers on the. Fascist party of Holland.
McCORMACK: And in this report you also said: "I was informed that there is a
Fascist Party springing up in Holland under the leadership of a man named
Mussait who is an engineer by profession, and who has approximately 50,000
followers at the present time, ranging in age from 18 to 25 years. It is said
that this man is in close touch with Berlin and is modeling his entire program
along the lines followed by Hitler in Germany. . . ." So you studied this
Fascist Party when you were in Holland, did you?
MacGUIRE: No, sir, I did not. It was a matter of public information in the
press and was reported so in the letter....
The committee examined tellers from the Central Hanover Bank and Trust Company
and other banks on financial transactions that had taken place between
MacGuire and Clark, on the account of Albert Christmas, Clark's attorney.
Evidence was found that the day before MacGuire had allegedly seen Butler in
Newark, he had drawn six thousand dollars in thousand-dollar bills from a
"special account" in the Manufacturers Trust Company and had also been given
ten thousand dollars in thousand-dollar bills by Christmas in Clark's
presence. The committee was convinced that MacGuire had been the "cashier" for
the planned veterans organization.
The committee also found evidence that disproved MacGuire's alibi that he had
been in Chicago on September 24, as well as his contention that he had not
seen Butler on that day at the Newark hotel. And it was established beyond
dispute that he had written detailed letters to Clark and Christmas reporting
on the Black Shirts of Italy, the Brown Shirts of Germany, and the Croix de
Feu of France.
McCormack announced grimly that he would subpoena Clark as soon as he returned
from Europe. "As the evidence stands," he declared, "it calls for an
explanation that the committee has been unable to obtain from Mr. MacGuire."
On November 26, 1934, referring to MacGuire's testimony,
Representative Dickstein declared, "You can't get away from it -somebody is
trying to shield somebody on something that looks rotten, and honest people
don't do that."
11
When the committee called no further witnesses from among those named in the
testimony, gossip swept Washington that the uncalled witnesses were simply too
powerful to be subpoenaed.
Investigating, reporter John Spivak learned that the only one known to have
been called to testify was California banker Frank N. Belgrano, commander of
the American Legion. Checking into why he had not testified, Spivak found that
he had been informed he could return home without having to answer a single
question. The reporter could not verify a rumor that Belgrano had met with
President Roosevelt at the White House, after which he had been taken off the
committee's hook.
When Spivak tried to learn more about this from the committee itself,
Dickstein revealed that he didn't know why Belgrano had been sent home without
being questioned, and McCormack declined to answer any questions on the
subject.
Apparently in response to Spivak and other newsmen pressing for an explanation
of what the committee was doing about Butler's charges, McCormack announced on
November 25 that the committee would make a statement the next day detailing
the testimony it had received. He declared that it would reveal "several
important inconsistencies" between the testimony of MacGuire and statements
attributed to him in the press. McCormack also wept out of his way to
emphasize vigorously that General Butler could not be accused of "publicity
seeking" in making public his exposure of the plot.
Next day, November 26, the committee's preliminary findings were released in
an eight-thousand-word statement signed by McCormack and Dickstein. It began:
"This committee has had no evidence before it that would in the slightest
degree warrant calling before it such men as John W. Davis, General Hugh
Johnson, General James G. Harbord, Thomas W. Lamont, Admiral William S. Sims
or Hanford MacNider. The committee will not take cognizance of names brought
into the testimony which constitutes mere hearsay. This committee is not
concerned with premature newspaper accounts, when given and published prior to
the taking of testimony. . . ."
In 1971 McCormack told the author that he had always tried to operate by the
rules of courtroom law, eliminating hearsay evidence be considered legally
inadmissible. Dickstein had given the same explanation of the committee's
modus operandi in 1934, whereupon Spivak had pointed out, "But your published
reports are full of hearsay testimony." Dickstein had merely blinked and said,
"They are?"
The committee statement withheld passing judgment on the testimony it had
heard as premature, but the two chairmen indicated that they intended to
pursue their inquiry further by calling Clark and Christmas to testify on
their return from Europe, to question them about the thousand-dollar bills.
The New York Times reported:
COMMITTEE CALM
OVER BUTLER PLOT
Has No Evidence to Warrant
Calling Johnson and Others
Named, It Declares
The so-called plot of Wall Street interests to have Major Gen. Smedley D.
Butler head a Fascist movement to take over the national government and
restore the gold dollar failed yesterday to emerge in any alarming proportions
from the statement by the Congressional Committee on Un-American Activities on
the evidence before it. . . .
But the committee was far from being as "calm" about the matter as the Times
story insisted. On that same day Dickstein wrote to President Roosevelt, "The
committee on C.U.A.A. has issued the enclosed short report on Gen. Butler's
charges, which we have made public, as the pressure brought to bear on the
committee made this course absolutely imperative.... I should very much like
to have a conversation with you at your convenience."
The day after the Times ran its "Committee Calm" version of the preliminary
McCormack-Dickstein statement, a refutation of this interpretation by
Dickstein compelled the paper to print a revised article of the retraction.
Now a new headline no longer carried the word "plot" in scoffing quotes:
BUTLER PLOT INQUIRY
NOT TO BE DROPPED
Dickstein Says Committee Will
Get to the Bottom of Story-
Awaits Clark's Return
The Congressional Committee on Un-American Activities still intends to get to
the bottom of the story of a Wall Street plot to put Major Gen. Smedley D.
Butler at the head of a Fascist army here, Representative Samuel Dickstein,
vice chairman, said yesterday. The committee's statement of the evidence, he
explained, was intended only to satisfy the great public interest in the plot.
Mr. Dickstein said that the committee was pleased that this preliminary report
was received "neither as a whitewash of notable persons nor as sensationalism
because of the startling nature of the possibilities, but simply as an
indication of the purpose of the committee to proceed carefully in such an
important matter."
Dickstein emphasized that the committee was far from satisfied with the story
told by MacGuire, whose memory had failed to produce any satisfactory account
of the funds that he had handled for Clark and Christmas. Furthermore,
although Clark and Christmas had cabled from abroad that they were willing to
return to testify, Dickstein said that they had not done so and that the
committee would like to question them both. As soon as their presence was
assured, a special executive session of the committee would be called to hear
them.
On November 30 President Roosevelt replied to Dickstein, thanking him for
sending him the preliminary report on the testimony and declaring, "I am
interested in having it. I take it that the committee will proceed further."
12
On December 3, 1934, Time magazine ran a first-page story that attempted to
ridicule Butler under the headlines "Plot Without Plotters." The story opened
with a pseudoaccount of Butler on a white horse assembling 500,000 veterans at
a C.C.C. camp at Elkridge, Maryland, and crying, "Men, Washington is but 30
miles away! Will you follow me?" The men all shout, "We will!" Then Butler's
army marches south to Washington on Highway 1 while an ammunition train
supplied by Remington Arms Company and E. I. du Pont de Nemours and Company
brings up the rear.
Also in the column on horseback behind Butler, according to Time's burlesqued
version of the plot, are "that grim, old-time cavalryman, General Hugh Samuel
Johnson" and MacArthur; behind them, three past national commanders of the
American Legion--MacNider, Johnson, and Henry Stevens. They are followed in a
shiny limousine by J. P. Morgan and his partner, Thomas W. Lamont.
Then, in Time's parody, Butler ("his spurs clinked loudly") strides into
Roosevelt's study and barks, "Mr. President, I have 500,000 men outside who
want peace but want something more. I wish you to remove Cordell Hull as
Secretary of State." Roosevelt promptly telephones for Hull's resignation.
"And now, Mr. President, I ask you to fill the vacancy which has just occurred
in your Cabinet by appointing me Secretary of State." Roosevelt signs the
commission for Butler, who then tells him, "Let it be understood that
henceforth I will act as the nation's executive. You may continue to live here
at the White House and draw your salary but you will do and say only what I
tell you. If not, you and Vice-President Garner will be dealt with as I think
best. In that event, as Secretary of State, I shall succeed to the Presidency,
as provided by law." The President nods assent, and the United States becomes
a Fascist state. Time then commented:
Such was the nightmarish page of future United States history pictured last
week in Manhattan by General Butler himself to the special House Committee
investigating unAmerican Activities. No military officer of the United States
since the late tempestuous George Custer has succeeded in publicly floundering
in so much hot water as Smedley Darlington Butler.
Time then recounted highlights of Butler's career, emphasizing the
controversies he had never shied away from and implying that they arose solely
from the general's taste for publicity.
Last month he told a Manhattan Jewish congregation that he would never again
fight outside the U.S. General Butler's sensational tongue had not been heard
in the nation's Press for more than a week when be cornered a reporter for the
Philadelphia Record and New York Post, poured into his ears the lurid tale
that he had been offered leadership of a Fascist Putsch scheduled for next
year....
Thanking their stars for having such sure-fire publicity dropped in their
laps, Representatives McCormack and Dickstein began calling witnesses to
expose the "plot." But there did not seem to be any plotters.
A bewildered army captain, commandant at the Elkridge CCC camp, could shed no
light on the report that his post was to be turned into a revolutionary base.
Mr. Morgan, just off a boat from Europe, had nothing to say, but Partner
Lamont did: "Perfect moonshine! Too utterly ridiculous to comment upon!" . . .
. Investor Clark, in Paris, freely admitted trying to get General Butler to
use his influence with the Legion against dollar devaluation, but stoutly
maintained: "I am neither a Fascist nor a Communist, but an American." He
threatened a libel suit "unless the whole affair is relegated to the funny
sheets by Sunday."
"It sounds like the best laugh story of the year," chimed in General MacArthur
from Washington....
Though most of the country was again laughing at the latest Butler story, the
special House Committee declined to join in the merriment . . . . .. From
present indications," said the publicity-loving New York Representative
[Dickstein], "General Butler has the evidence. He's not making serious charges
unless he has something to back them up. We will have some men here with
bigger names than Butler's before this is over."
For those of its readers who might have found Time's satirical attack too
subtle, the magazine helped them get the message by its choice of photos to
accompany the story. An unflattering photo of Butler in civilian clothes, with
his finger reflectively in one ear, was labeled, "He was deaf to a
dictatorship." The pose subtly suggested that the general, as the copy broadly
hinted, was a bit daft.
In contrast, a jovial, laughing picture of that good-natured, genial
humanitarian, J. P. Morgan, looking like everybody's grandfather, was labeled,
"Moonshine provided the amusement." And a stern, handsome picture of Colonel
Grayson M.-P. Murphy, dressed in a trim World War I colonel's uniform, hand
dashingly on hip, was captioned with this quote: "'A fantasy!"'
The author asked McCormack in 1971 about Time's fairness in reporting the
Butler hearing. The answer was a snort of disgust. "Time has always been about
as filthy a publication as ever existed," he said emphatically. "I've said
that publicly many times. The truth gets no coverage at all, just
sensationalism, whatever will sell copies."
Indignant on Butler's behalf, the New York City post of the V.F.W. sent
President Roosevelt a wire on December 7 pledging their loyalty and support,
and commending Butler for his courage and patriotism in exposing the
conspirators.
Ten days later McCormack announced that Albert Christmas had returned from
Europe and would testify in two or three days in an executive session. Clark's
attorney was not questioned, however, until the final day of the committee's
life, January 3, 1935, after which no further investigatory action could be
taken by the committee.
". . . and then the questions were limited only to money given MacGuire by
the lawyer and Clark," Spivak noted. "Presumably because of the sacredness of
lawyer-client confidences, no questions were asked about conversations or
correspondence between an alleged principal in the plot and his attorney."
There was an interesting exchange, nevertheless, in the matter of $65,000
MacGuire testified that he had received for traveling and entertainment
expenses:
McCORMACK: So the way you want to leave it is there is $65,000 or $66,000 that
Mr. MacGuire received from either you, or Mr. Clark, which he spent in the
period between June and December of 1933 for traveling and entertainment
expenses?
CHRISTMAS: Yes, Sir.
McCORMACK: Did he return to you some time in August 119341 approximately
$30,000 in cash?
CHRISTMAS: No.
McCORMACK: Do you know he testified be did?
CHRISTMAS: The committee gave me some indication of such testimony at a
previous session.
McCORMACK: Assuming he has testified to that, that is not so?
CHRISTMAS: I would say he is in error. He is mistaken.
So the committee found still another reason to doubt the veracity of MacGuire,
who had denied, under oath, all the allegations of the Fascist plot in which
he was the go-between, as alleged by General Smedley Butler.
pp. 164-189
-----
Aloha, He'Ping,
Om, Shalom, Salaam.
Em Hotep, Peace Be,
Omnia Bona Bonis,
All My Relations.
Adieu, Adios, Aloha.
Amen.
Roads End
Kris
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