George Bush: The Unauthorized Biography - Part 3 of 8

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CHAPTER 8

THE PERMIAN BASIN GANG, 1948-59

 

Pecunia non olet. [Money doesn't smell.]

-- Vespasian During the years following the Second World War, the

patrician families of the Eastern Anglophile Liberal Establishment sent

numbers of their offspring to colonize those geographic regions of the

United States which, the families estimated, were likely to prosper in the

postwar period. On the surface, this appears as a simple reflex of greed:

Cadet sons were dispatched to those areas of the provinces where their

instinctive methods of speculation and usury could be employed to

parasitize emerging wealth. More fundamentally, this migration of young

patrician bankers answered the necessity of political control.

The Eastern Establishment, understood as an agglomeration of financier

factions headquartered in Wall Street, had been the dominant force in

American politics since J.P. Morgan had bailed out the Grover Cleveland

regime in the 1890s. Since the assassination of William McKinley and the ad

vent of Theodore Roosevelt, the power of the Wall Street group had grown

continuously. The Eastern Establishment may have had its earliest roots

north of Boston and in the Hudson River Valley, but it was determined to

be, not a mere regional financier faction, but the undisputed ruling elite

of the United States as a whole, from Boston to Bohemian Grove and from

Palm Beach to the Pacific Northwest. It was thus imperative that the

constant tendency toward the formation of regional factions be preempted by

the pervasive presence of men bound by blood loyalty to the dominant

cliques of Washington, New York, and the "mother country," the City of Londo

n.

If the Eastern Liberal Establishment were thought of as a cancer, then

after 1945 that cancer went into a new phase of malignant metastasis,

infecting every part of the American body politic. George Bush was one of

those motile, malignant cells. He was not alone; Robert Mosbacher also made

the journey from New York to Texas, in Mosbacher's case directly to

Houston.

The various sycophant mythographers who have spun their yarns about the

life of George Bush have always attempted to present this phase of Bush's

life as the case of a fiercely independent young man who could have gone

straight to the top in Wall Street by trading on father Prescott's name and

connections, but who chose instead to strike out for the new frontier among

the wildcatters and roughnecks of the west Texas oil fields and become a

self-made man.

As George Bush himself recounted in a 1983 interview, "If I were a

psychoanalyzer, I might conclude that I was trying to, not compete with my

father, but do something on my own. My stay in Texas was no Horatio Alger

thing, but moving from New Haven to Odessa just about the day I graduated

was quite a shift in lifestyle." / Note #1

These fairy tales from the "red Studebaker" school seek to obscure the

facts: that Bush's transfer to Texas was arranged from the top by

Prescott's Brown Brothers Harriman cronies, and that every step forward

made by Bush in the oil business was assisted by the capital resources of

our hero's maternal uncle, George Herbert Walker, Jr., "Uncle Herbie," the

boss of G.H. Walker & Co. investment firm of Wall Street. Uncle Herbie had

graduated from Yale in 1927, where he had been a member of Skull and Bones.

This is the Uncle Herbie who will show up as lead investor and member of

the board of Bush-Overbey oil, of Zapata Petroleum, and of Zapata Offshore

after 1959...

Father Prescott procured George not one job, but two, in each case

contacting cronies who depended at least partially on Brown Brothers

Harriman for business.

One crony contacted by father Prescott was "Ray Kravis," who was in the oil

business in Tulsa, Oklahoma. Oklahoma had experienced a colossal oil boom

between the two world wars, and Ray Kravis had cashed in, building up a

personal fortune of some $25 million. Ray was the son of a British tailor

whose father had come to America and set up a haberdashery in Atlantic

City, New Jersey. Young Ray Kravis had arrived in Tulsa in 1925, in the

midst of the oil boom that was making the colossal fortunes of men like J.

Paul Getty. Ray Kravis was primarily a tax accountant, and he had invented

a very special tax shelter which allowed oil properties to be "packaged"

and sold in such a way as to reduce the tax on profits earned from the

normal oil property rate of 81 percent to a mere 15 percent. This meant

that the national tax base was eroded, and each individual taxpayer bilked,

in order to subsidize the formation of immense private fortunes; this will

be found to be a constant theme among George Bush's business associates

down to the present day.

Ray Kravis's dexterity in setting up these tax shelters attracted the

attention of Joseph P. Kennedy, the bucaneering bootlegger, entrepreneur,

political boss and patriarch of the Massachusetts Kennedy clan. For many

years Ray Kravis functioned as the manager of the Kennedy family fortune

(or fondo), the same job that later devolved to Stephen Smith. Ray Kravis

and Joe Kennedy both wintered in Palm Beach, where they were sometimes golf

partners. / Note #2

In 1948-49, father Prescott was the managing partner of Brown Brothers

Harriman. Prescott knew Ray Kravis as a local Tulsa finance mogul and

wheeler-dealer, who was often called upon by Wall Street investment houses

as a consultant to evaluate the oil reserves of various companies. The

estimates that Ray Kravis provided often involved the amount of oil in the

ground that these firms possessed, and these estimates went to the heart of

the oil business as a ground-rent exploitation in which current oil

production was far less important than the reserves still beneath the soil.

Such activity imparted the kind of primitive-accumulation mentality that

was later seen to animate Ray Kravis's son Henry. During the 1980s, as we

will see, Henry Kravis personally generated some $58 billion in debt for

the purpose of acquiring 36 companies and assembling the largest corporate

empire, in paper terms, of all time. Henry Kravis would be one of the

leaders of the leveraged buyout gang which became a mainstay of the

political machine of George Bush....

So father Prescott asked Ray if he had a job for young George. The answer

was, of course he did.

But in the meantime, Prescott Bush had also been talking with another crony

beholden to him, "Henry Neil Mallon," who was the president and chairman of

the board of Dresser Industries, a leading manufacturer of drill bits and

related oil well drilling equipment. Dresser had been incorporated in 1905

by Solomon R. Dresser, but had been bought up and reorganized by W.A.

Harriman & Co. in 1928-29.

Henry Neil Mallon, for whom the infamous Neil Mallon Bush of Hinckley and

Silverado fame is named, came from a Cincinnati family who were traditional

retainers for the Taft clan, in the same way that the Bush-Walker family

were retainers for the Harrimans. As a child, Neil Mallon had gone with his

family to visit their close friends, President William Howard Taft and his

family, at the White House. Mallon had then attended the Taft School in

Watertown, Connecticut, and had gone on to Yale University in the fall of

1913, where he met Bunny Harriman, Prescott Bush, Knight Wooley, and the

other Bonesmen.

As we recall from the previous chapter: the society's internal history

boasted that in 1918, Mallon burned the flesh and hair off the skull of

Geronimo, which Prescott Bush and his friends stole from the despoiled

grave at Fort Sill, Oklahoma.

One day in December 1928, Bunny Harriman, father Prescott and Knight Wooley

were sitting around the Harriman counting house discussing their

reorganization of Dresser Industries. Mallon, who was returning to Ohio

after six months spent mountaineering in the Alps, came by to visit. At a

certain point in the conversation, Bunny pointed to Mallon and exclaimed,

"Dresser! Dresser!" Mallon was subsequently interviewed by George Herbert

Walker, the president of W.A. Harriman & Co. As a result of this interview,

Mallon was immediately made president of Dresser, although he had no

experience in the oil business. Mallon clearly owed the Walker-Bush clan

some favors. / Note #3

Prescott Bush had become a member of the board of directors of Dresser

Industries in 1930, in the wake of the reorganization of the company, which

he had personally helped to direct. Prescott Bush was destined to remain on

the Dresser board for 22 years, until 1952, when he entered the United

States Senate. Father Prescott was thus calling in a chit which procured

George a second job offer, this time with Dresser Industries or one of its

subsidiaries.

George Bush knew that the oil boom in Oklahoma had passed its peak, and

that Tulsa would no longer offer the sterling opportunities for a fast buck

it had presented 20 years earlier. Dresser, by contrast, was a vast

international corporation, ideally suited to gaining a rapid overview of

the oil industry and its looting practices. George Bush accordingly called

Ray Kravis and, in the ingratiating tones he was wont to use as he clawed

his way toward the top, said th at he wished respectfully to decline the

job that Kravis had offered him in Tulsa. His first preference was to go to

work for Dresser. Ray Kravis, who looked to Prescott for business, released

him at once. "I know George Bush well," said Ray Kravis years later. "I've

known him since he got out of school. His father was a very good friend of

mine." / Note #4

 

Bush in Odessa

This is the magic moment in which all the official Bush biographies show

our hero riding into Odessa, Texas in the legendary red Studebaker, to take

up a post as an equipment clerk and trainee for the Dresser subsidiary

IDECO (International Derrick and Equipment Company).

But the red Studebaker myth, as alreadynoted, misrepresents the facts.

According to the semi-official history of Dresser Industries, George Bush

was first employed by Dresser at their corporate headquarters in Cleveland,

Ohio, where he worked for Dresser executive R.E. Reimer, an ally of Mallon.

/ Note #5 This stint in Cleveland is hardly mentioned by the pro-Bush

biographers, making us wonder what is being covered up. On the same page

that relates these interesting facts, there is a picture that shows father

Prescott, Dorothy, Barbara Bush, and George holding his infant son George

Walker Bush. Young George W. is wearing cowboy boots. They are all standing

in front of a Dresser Industries executive airplane, apparently a DC-3.

Could this be the way George really arrived in Odessa?

The Dresser history also has George Bush working for Pacific Pumps, another

Dresser subsidiary, before finally joining IDECO. According to Bush's

campaign autobiography, he had been with IDECO for a year in Odessa, Texas

before being transferred to work for Pacific Pumps in Huntington Park and

Bakersfield, California. Bush says he worked at Huntington Park as an

assemblyman, and it was here that he claims to have joined the United

Steelworkers Union, obtaining a union card that he will still pull out when

confronted for his long history of union-busting, as for example when he

was heckled at a shipyard in Portland, Oregon during the 1988 campaign.

Other accounts place Bush in Ventura, Compton and "Richard Nixon's home

town of Whittier" during this same period. / Note #6

If Bush actually went to California first and only later to Odessa, he may

be lying in order to stress that he chose Texas as his first choice, a

distortion that may have been concocted very early in his political career

to defend himself against the constant charge that he was a carpetbagger.

Odessa, Texas, and the nearby city of Midland were both located in the

geological formation known as the "Permian Basin," the scene of an oil boom

that developed in the years after the Second World War. Odessa at this time

was a complex of yards and warehouses, where oil drilling equipment was

brought for distribution to the oil rigs that were drilling all over the

landscape.

At IDECO, Bush worked for supervisor Bill Nelson, and had one Hugh Evans

among his co-workers. Concerning this period, we are regaled with stories

about how Bush and Barbara moved into a shotgun house, an apartment that

had been divided by a partition down the middle, with a bathroom they

shared with a mother and daughter prostitute team. There was a pervasive

odor of gas, which came not from a leak in the oven, but from nearby oil

wells where the gas was flared off. George and Barbara were to spend some

time slumming in this setting. But Bush was anxious to ingratiate himself

with the roughnecks and roustabouts; he began eating the standard Odessa

diet of a bowl of chili with crackers and beer for lunch, and chicken-fried

steak for dinner. Perhaps his affected liking for country and western music

and pork rinds, and other public relations ploys go back to this time. Bush

is also fond of recounting the story of how, on Christmas Eve, 1948, he got

drunk during various IDECO customer receptions and passed out, dead drunk,

on his own front lawn, where he was found by Barbara. George Bush, we can

see, is "truly a regular guy."

According to the official Bush version of events, George and "Bar"

peregrinated during 1949 far from their beloved Texas to various towns in

California where Dresser had subsidiaries. Bush claims that he drove 1,000

miles a week through the Carrizo Plains and the Cuyama Valley. Some months

later they moved to Midland, another tumbleweed town in west Texas. Midland

offered the advantage of being the location of the west Texas headquarters

of many of the oil companies that operated in Odessa and the surrounding

area....

The Bush social circle in Odessa was hardly composed of oil field

roughnecks. Rather, their peer group was composed more of the sorts of

people they had known in New Haven: a clique of well-heeled recent

graduates of prestigious eastern colleges who had been attracted to the

Permian Basin in the same way that Stanford, Hopkins, Crocker and their ilk

were attracted to San Francisco during the gold rush. Here were Toby

Hilliard, John Ashmun, and Pomeroy Smith, all from Princeton. Earle Craig

had been at Yale. Midland thus boasted a Yale Club and a Harvard Club and a

Princeton Club. The natives referred to this clique as "the Yalies." Also

present on the scene in Midland were J. Hugh Liedtke and William Liedtke,

who had grown up in Oklahoma, but who had attended college at Amherst in

Massachusetts.

Many of these individuals had access to patrician fortunes back East for

the venture capital they mobilized behind their various deals. Toby

Hilliard's full name was "Harry Talbot Hilliard" of Fox Chapel near

Pittsburgh, where the Mellons had their palatial residence. "Earle Craig"

was also hooked up to big money in the same area. The "Liedtke brothers,"

as we will see, had connections to the big oil money that had emerged

around Tulsa. Many of these "Yalies" also lived in the Easter Egg Row

neighborhood. A few houses away from George Bush there lived a certain

"John Overbey." According to Overbey, the "people from the East and the

people from Texas or Oklahoma all seemed to have two things in common. They

all had a chance to be stockbrokers or investment bankers. And they all

wanted to learn the oil business instead." / Note #7

 

The Landman

Overbey made his living as a landman. Since George Bush would shortly also

become a landman, it is worth investigating what this occupation actually

entails; in doing so, we will gain a permanent insight into Bush's

character. The role of the landman in the Texas oil industry was to try to

identify properties where oil might be found, sometimes on the basis of

leaked geological information, sometimes after observing that one of the

major oil companies was drilling in the same locale. The landman would

scout the property, and then attempt to get the owner of the land to sign

away the mineral rights to the property in the form of a lease. If the

property owner were well informed about the possibility that oil might in

fact be found on his land, the price of the lease would obviously go up,

because signing away the mineral rights meant that the income (or

"royalties") from any oil that might be found would never go to the owner

of the land.

A cunning landman would try to gather as much insider information as he

could and keep the rancher as much in the dark as possible. In rural Texas

in the 1940s, the role of the landman could rather easily degenerate into

that of the ruthless, money-grubbing con artist, who would try to convince

an ill-informed and possibly ignorant Texas dirt farmer, who was just

coming up for air after the great depression, that the chances of finding

oil on his land were just about zero, and that even a token fee for a lease

on the mineral rights would be eminently worth taking.

Once the farmer or rancher had signed away his right to future oil

royalties, the landman would turn around and attempt to "broker" the lease

by selling it at an inflated price to a major oil company that might be

interested in drilling, or to some other buyer. There was a lively market

in such leases in the restaurant of the Scharbauer Hotel in Midland, where

maps of the oil fields hung on the walls and oil leases coul d change hands

repeatedly in the course of a single day. Sometimes, if a landman were

forced to sell a lease to the mineral rights of land where he really

thought there might be oil, he would seek to retain an override, perhaps

amounting to a sixteenth or a thirty-second of the royalties from future

production. But that would mean less cash or even no cash received now, and

small-time operators like Overbey, who had no capital resources of their

own, were always strapped for cash. Overbey was lucky if he could realize a

profit of a few hundred dollars on the sale of a lease.

This form of activity clearly appealed to the mean-spirited and the greedy,

to those who enjoyed rooking their fellowman. It was one thing for Overbey,

who may have had no alternative to support his family. It was quite another

thing for George Herbert Walker Bush, a young plutocrat out slumming. But

Bush was drawn to the landman and royalty game, so much so that he offered

to raise capital back East if Overbey would join him in a partnership. /

Note #8

Overbey accepted Bush's proposition that they capitalize a company that

would trade in the vanished hopes of the ranchers and farmers of northwest

Texas. Bush and Overbey flew back East to talk with Uncle Herbie in the

oak-paneled board room of G.H. Walker & Co. in Wall

Street. According to "Newsweek," "Bush's partner, John Overbey, still

remembers the dizzying whirl of a money-raising trip to the East with

George and Uncle Herbie: lunch at New York's 21 Club, weekends at

Kennebunkport where a bracing Sunday dip in the Atlantic off Walker's Point

ended with a servant wrapping you in a large terry towel and handing you a

martini." / Note #9

The result of the odyssey back East was a capital of $300,000, much of it

gathered from Uncle Herbie's clients in the City of London, who were of

course delighted at the prospect of parasitizing Texas ranchers. One of

those eager to cash in was "Jimmy Gammell" of Edinburgh, Scotland, whose

Ivory and Sime counting house put up $50,000 from its Atlantic Asset Trust.

Gammell's father had been head of the British military mission in Moscow in

1945, part of the Anglo-American core group there with U.S. Ambassador

Averell Harriman. James Gammell is today the eminence grise of the Scottish

investment community, and he has retained a close personal relation to Bush

over the years. Mark this Gammell well; he will return to our narrative

shortly.

"Eugene Meyer," the owner of the "Washington Post" and the father of that

paper's present owner, Katharine Meyer Graham, anted up an investment of

$50,000 on the basis of the tax-shelter capabilities promised by

Bush-Overbey. Meyer, a president of the World Bank, also procured an

investment from his son-in-law Phil Graham for the Bush venture. Father

Prescott Bush was also counted in, to the tune of about $50,000. In the

days of real money, these were considerable sums. The London investors got

shares of stock in the new company, called Bush-Overbey, as well as

Bush-Overbey bonded debt. Bush and Overbey moved into an office on the

ground floor of the Petroleum Building in Midland.

The business of the landman, it has been pointed out, rested entirely on

personal relations and schmooze. One had to be a dissembler and an

intelligencer. One had to learn to cultivate friendships with the

geologists, the scouts, the petty bureaucrats at the county court house

where the land records were kept, the journalists at the local paper, and

with one's own rivals, the other landmen, who might invite someone with

some risk capital to come in on a deal. Community service was an excellent

mode of ingratiation, and George Bush volunteered for the Community Chest,

the YMCA, and the Chamber of Commerce. It meant small talk about wives and

kids, attending church -- deception postures that in a small town had to

pervade the smallest details of one's life.

It was at this time in his life that Bush seems to have acquired the habit

of writing ingratiating little personal notes to people he had recently

met, a habit that he would use over the years to cultivate and maintain his

personal network. Out of all this ingratiating Babbitry and boosterism

would come acquaintances and the bits of information that could lead to

windfall profits.

There had been a boom in Scurry County, but that was subsiding. Bush drove

to Pyote, to Snyder, to Sterling City, to Monahans, with Rattlesnake Air

Force Base just outside of town. How many Texas ranchers can remember

selling their mineral rights for a pittance to smiling George Bush, and

then having oil discovered on the land, oil from which their family would

never earn a penny?

Across the street from Bush-Overbey were the offices of Liedtke & Liedtke,

Attorneys-at-law. "J. Hugh Liedtke" and "William Liedtke" were from Tulsa,

Oklahoma, where they, like Bush, had grown up rich, as the sons of a local

judge who had become one of the top corporate lawyers for Gulf Oil. The

Liedtkes' grandfather had come from Prussia, but had served in the

Confederate Army. J. Hugh Liedtke had found time along the way to acquire

the notorious Harvard Master of Business Administration degree in one year.

After service in the Navy during World War II, the Liedtkes obtained law

degrees at the University of Texas law school, where they rented the

servants' quarters of the home of U.S. Senator Lyndon B. Johnson, who was

away in Washington most of the time...

The Liedtkes combined the raw, uncouth primitive accumulation mentality of

the oil boom town with the refined arts of usury and speculation as Harvard

taught them. Their law practice was such in name only; their primary and

almost exclusive activity was buying up royalty leases on behalf of a

moneybags in Tulsa who was a friend of their family...

Hugh Liedtke was always on the lookout for the Main Chance. Following in

the footsteps of his fellow Tulsan Ray Kravis, Hugh Liedtke schemed and

schemed until he had found a way to go beyond hustling for royalty leases:

He concocted a method of trading oil-producing properties in such a way as

to permit the eventual owner to defer all tax liabilities until the field

was depleted. Sometimes Hugh Liedtke would commute between Midland and

Tulsa on an almost daily basis. He would spend the daylight hours prowling

the Permian Basin for a land deal, make the 13-hour drive to Tulsa

overnight to convince his backers to ante up the cash, and then race back

to Midland to close the deal before the sucker got away. It was during this

phase that it occurred to Liedtke that he could save himself a lot of

marathon commuter driving if he could put together a million dollars in

venture capital and "inventory" the deals he was otherwise forced to make

on a piecemeal, ad hoc basis. / Note #1 / Note #0

 

Zapata Petroleum

The Liedtke brothers now wanted to go beyond royalty leases and land sale

tax dodges, and begin large-scale drilling and production of oil. George

Bush, by now well versed in the alphas and omegas of oil as ground rent,

was thinking along the same lines. In a convergence that was full of

ominous portent for the U.S. economy of the 1980s, the Liedtke brothers and

George Bush decided to pool their capital and their rapacious talents by

going into business together. Overbey was on board initially, but would

soon fall away.

The year was 1953, and Uncle Herbie's G.H. Walker & Co. became the

principal underwriter of the stock and convertible debentures that were to

be offered to the public. Uncle Herbie would also purchase a large portion

of the stock himself. When the new company required further infusions of

capital, Uncle Herbie would float the necessary bonds. Jimmy Gammell

remained a key participant and would find a seat on the board of directors

of the new company. Another of the key investors was the Clark Family

Estate, meaning the trustees who managed the Singer Sewing machine fortune.

/ Note #1 / Note #1 Some other money came from various pension funds and

endowments, sources that would become very popular during the leveraged

buyout orgy Bush presided over in the 1980s. Of the capital of the new

Bush-Liedtke concern, about $500,000 would come from Tulsa cronies of the

Liedtke brothers, and the other $500,000 from the circles of Uncle Herbie.

The latter were referred to by Hugh Liedtke as "the New York guys."

The name chosen for the new concern was "Zapata Petroleum." According to

Hugh Liedtke, the new entrepreneurs were attracted to the name when they

saw it on a movie marquee, where the new release "Viva Zapata!," starring

Marlon Brando as the Mexican revolutionary, was playing. Liedtke

characteristically explains that part of the appeal of the name was the

confusion as to whether Zapata had been a patriot or a bandit. / Note #1 /

Note #2

The Bush-Liedtke combination concentrated its attention on an oil property

in Coke County called JamesonField, a barren expanse of prairie and

sagebrush where six widely separated wells had been producing oil for some

years. Hugh Liedtke was convinced that these six oil wells were tapping

into a single underground pool of oil, and that dozens or even hundreds of

new oil wells drilled into the same field would all prove to be gushers. In

other words, Liedtke wanted to gamble the entire capital of the new firm on

the hypothesis that the wells were, in oil parlance, "connected." One of

Liedtke's Tulsa backers was supposedly unconvinced, and argued that the

wells were too far apart; they could not possibly connect. "Goddamn, they

do!" was Hugh Liedtke's rejoinder. He insisted on shooting the works in a

"va-banque" operation. Uncle Herbie's circles were nervous: "The New York

guys were just about to pee in their pants," boasted Leidtke years later.

Bush and Hugh Liedtke obviously had the better information: The wells were

connected, and 127 wells were drilled without encountering a single dry

hole. As a result, the price of a share of stock in Zapata went up from

seven cents a share to $23.

During this time, Hugh Liedtke collaborated on several small deals in the

Midland area with a certain "T. Boone Pickens," later one of the most

notorious corporate raiders of the 1980s, one of the originators of the

"greenmail" strategy of extortion, by which a raider would accumulate part

of the shares of a company and threaten to go all the way to a hostile

takeover unless the management of the company agreed to buy back those

shares at an outrageous premium. Pickens is the buccaneer who was

self-righteously indignant when the Japanese business community attempted

to prevent him from introducing these shameless looting practices into the

Japanese economy.

Pickens, too, was a product of the Bush-Liedtke social circle of Midland.

When he was just getting started in the mid-fifties, Pickens wanted to buy

the Hugoton Production Company, which owned the Hugoton field, one of the

world's great onshore deposits of natural gas. Pickens engineered the

hostile takeover of Hugoton by turning to Hugh Liedtke to be introduced to

the trustees of the Clark Family Estate, who, as we have just seen, had put

up part of the capital for Zapata. Pickens promised the Clark trustees a

higher return than was being provided by the current management, and this

support proved to be decisive in permitting Pickens's Mesa Petroleum to

take over Hugoton, launching this corsair on a career of looting and

pillage that still continues. In 1988, George Bush would give an interview

to a magazine owned by Pickens in which the Vice President would defend

hostile leveraged buyouts as necessary to the interests of the

shareholders.

In the meantime, after two to three years of operations, the oil flow out

of Zapata's key Jameson field had begun to slow down. Although there was

still abundant oil in the ground, the natural pressure had been rapidly

depleted, so Bush and the Liedtkes had to begin resorting to stratagems in

order to bring the oil to the surface. They began pumping water into the

underground formations in order to force the oil to the surface. From then

on, "enhanced recovery" techniques were necessary to keep the Jameson field

on line.

During 1955 and 1956, Zapata was able to report a small profit. In 1957,

the year of the incipient Eisenhower recession, this turned into a loss of

$155,183, as the oil from the Jameson field began to slow down. In 1958,

the loss was $427,752, and in 1959, there was $207,742 of red ink. 1960

(after Bush had departed from the scene) brought another loss, this time of

$372,258. It was not until 1961 that Zapata was able to post a small profit

of $50,482. / Note #1 / Note #3 Despite the fact that Bush and the Liedtkes

all became millionaires through the increased value of their shares, it was

not exactly an enviable record; without the deep pockets of Bush's Uncle

Herbie Walker and his British backers, the entire venture might have

foundered at an early date.

Bush and the Liedtkes had been very lucky with the Jameson field, but they

could hardly expect such results to be repeated indefinitely. In addition,

they were now posting losses, and the value of Zapata stock had gone into a

decline. Bush and the Liedtke brothers now concluded that the epoch in

which large oil fields could be discovered within the continental United

States was over. Mammoth new oil fields, they believed, could only be found

offshore, located under hundreds of feet of water on the continental

shelves, or in shallow seas like the Gulf of Mexico and the Caribbean.

By a happy coincidence, in 1954 the U.S. federal government was just

beginning to auction the mineral rights for these offshore areas. With

father Prescott Bush directing his potent Brown Brothers Harriman/Skull and

Bones network from the U.S. Senate while regularly hob-nobbing with

President Eisenhower on the golf links, George Bush could be confident of

receiving special privileged treatment when it came to these mineral

rights. Bush and his partners therefore judged the moment ripe for

launching a for-hire drilling company, Zapata Offshore, a Delaware

corporation that would offer its services to the companies making up the

Seven Sisters international oil cartel in drilling underwater wells. Forty

percent of the offshore company's stock would be owned by the original

Zapata firm. The new company would also be a buyer of offshore royalty

leases. Uncle Herbie helped arrange a new issue of stock for this Zapata

offshoot. The shares were easy to unload because of the 1954 boom in the

New York stock market. "The stock market lent itself to speculation," Bush

would explain years later, "and you could get equity capital for new

ventures." / Note #1/ Note #4

1954 was also the year that the CIA overthrew the government of Jacobo

Arbenz in Guatemala. This was the beginning of a dense flurry of U.S.

covert operations in Central America and the Caribbean, featuring

especially Cuba.

The first asset of Zapata Offshore was the SCORPION, a $3.5 million

deep-sea drilling rig that was financed by $1.5 million from the initial

stock sale plus another $2 million from bonds marketed with the help of

Uncle Herbie. The SCORPION was the first three-legged, self-elevating

mobile drilling barge, and it was built by R. G. LeTourneau, Inc. of

Vicksburg, Mississippi. The platform weighed some 9 million pounds and

measured 180 by 150 feet, and the three legs were 140 feet long when fully

extended. The rig was floated into the desired drilling position before the

legs were extended, and the main body was then pushed up above the waves by

electric motors. The SCORPION was delivered early in 1956, was commissioned

at Galveston in March, 1956 and was put to work at exploratory drilling in

the Gulf of Mexico during the rest of the year.

During 1956, the Zapata Petroleum officers included J. Hugh Liedtke as

president, George H.W. Bush as vice president, and William Brumley of

Midland, Texas, as treasurer. The board of directors lined up as follows:

/ Note #b|George H.W. Bush, Midland, Texas;

/ Note #b|J.G.S. Gammell, Edinburgh, Scotland, manager of British Assets

Trust, Ltd.;

/ Note #b|J. Hugh Liedtke, Midland, Texas;

/ Note #b|William C. Liedtke, independent oil operator, Midland, Texas;

/ Note #b|Arthur E. Palmer, Jr., New York, N.Y., a partner in Winthrop,

Stimson, Putnam, and Roberts;

/ Note #b|G.H. Walker, Jr. (Uncle Herbie), managing partner of G.H. Walker

and Co., New York, N.Y.;

/ Note #b|Howard J. Whitehill, independent oil producer, Tulsa, Oklahoma;

/ Note #b|Eugene F. Williams, Jr., secretary of the St. Louis Union Trust

Company of St. Louis, Missouri; fellow member with "Poppy" Bush in the

class of 1942 AUV secret society at Andover prep, later chairman of the

Andover board;

/ Note #b|D.D. Bovaird, president of the Bovaird Supply Co. of Tulsa,

Oklahoma, and chairman of the board of the Oklahoma City branch of the

Tenth Federal District of the Federal Reserve Board; and

/ Note #b|George L. Coleman, investments, Miami, Oklahoma.

An interim director that year had been Richard E. Fleming of Robert Fleming

and Co., London, England. Counsel were listed as Baker, Botts, Andrews &

Shepherd of Houston, Texas; auditors were Arthur Andersen in Houston, and

transfer agents were J.P. Morgan & Co., Inc., of New York City and the

First National Bank and Trust Company of Tulsa. / Note #1 / Note #5

George Bush personally was much more involved with the financial management

of the company than with its actual oil-field operations. His main activity

was not finding oil or drilling wells but, as he himself put it,

"stretching paper" -- rolling over debt and making new financial

arrangements with the creditors. / Note #1 / Note #6

During 1956, despite continuing losses and thanks again to Uncle Herbie,

Zapata was able to float yet another offering, this time a convertible

debenture for $2.15 million, for the purchase of a second Le Tourneau

drilling platform, the VINEGAROON, named after a west Texas stinging

insect. The VINEGAROON was delivered during 1957, and soon scored a "lucky"

hit drilling in block 86 off Vermilion Parish, Louisiana. This was a

combination of gas and oil, and one well was rated at 113 barrels of

distillate and 3.6 million cubic feet of gas per day. / Note #1 / Note #7

This was especially remunerative, because Zapata had acquired a

half-interest in the royalties from any oil or gas that might be found.

VINEGAROON then continued to drill offshore from Vermilion Parish,

Louisiana, on a farmout from Continental Oil.

As for the SCORPION, during part of 1957 it was under contract to the

Bahama-California Oil Company, drilling between Florida and Cuba. It was

then leased by Gulf Oil and Standard Oil of California, on whose behalf it

started drilling during 1958 at a position on the Cay Sal Bank, 131 miles

south of Miami, Florida, and just 54 miles north of Isabela, Cuba. Cuba was

an interesting place just then; the U.S.-backed insurgency of Fidel Castro

was rapidly undermining the older U.S.-imposed regime of Fulgencio Batista.

That meant that SCORPION was located at a hot corner. We note that Allen

Dulles, then director of the Central Intelligence Agency, had previously

been legal counsel to Gulf Oil for Latin American operations, and counsel

to George Bush's father at Brown Brothers Harriman for eastern Europe.

During 1957 a certain divergence began to appear between Uncle Herbie

Walker, Bush, and the "New York guys" on the one hand, and the Liedtke

brothers and their Tulsa backers on the other. As the annual report for

that year noted, "There is no doubt that the drilling business in the Gulf

of Mexico has become far more competitive in the last six months than it

has been at any time in the past." Despite that, Bush, Walker and the New

York investors wanted to push forward into the offshore drilling and

drilling services business, while the Liedtkes and the Tulsa group wanted

to concentrate on acquiring oil in the ground and natural gas deposits.

The 1958 annual report notes that, with no major discoveries made, 1958 had

been "a difficult year." It was, of course, the year of the brutal

Eisenhower recession. SCORPION, VINEGAROON, and NOLA I, the offshore

company's three drilling rigs, could not be kept fully occupied in the Gulf

of Mexico during the whole year, and so Zapata Offshore had lost $524,441,

more than Zapata Petroleum's own loss of $427,752 for that year. The

Liedtke viewpoint was reflected in the notation that "disposing of the

offshore business had been considered." The great tycoon Bush conceded in

the Zapata Offshore annual report for 1958: "We erroneously predicted that

most major [oil] companies would have active drilling programs for 1958.

These drilling programs simply did not materialize...." In 1990, Bush

denied for months that there was a recession, and through 1991 claimed that

the recession had ended, when it had, in fact, long since turned into a

depression. His current blindness about economic conjunctures would appear

to be nothing new.

By 1959, there were reports of increasing personal tensions between the

domineering and abrasive J. Hugh Liedtke, on the one hand, and Bush's Uncle

Herbie Walker on the other. Liedtke was obsessed with his plan for creating

a new major oil company, the boundless ambition that would propel him down

a path littered with asset-stripped corporations into the devastating

Pennzoil-Getty-Texaco wars of a quarter-century later. During the course of

this year, the two groups of investors arrived at a separation that was

billed as "amicable," and which in any case never interrupted the close

cooperation among Bush and the Liedtke brothers. The solution was that the

ever-present Uncle Herbie would buy out the Liedtke-Tulsa 40 percent stake

in Zapata Offshore, while the Liedtke backers would buy out the Bush-Walker

interest in Zapata Petroleum.

For this to be accomplished, George Bush would require yet another large

infusion of capital. Uncle Herbie now raised yet another tranche for

George, this time over $800,000. The money allegedly came from Bush-Walker

friends and relatives. / Note #1 / Note #8 Even if the faithful efforts of

Uncle Herbie are taken into account, it is still puzzling to see a series

of large infusions of cash into a poorly managed small company that had

posted a series of substantial losses and whose future prospects were

anything but rosy. At this point it is therefore legitimate to pose the

question: Was Zapata Offshore an intelligence community front at its

foundation in 1954, or did it become one in 1959, or perhaps at some later

point? This question cannot be answered with finality, but some relevant

evidence will be discussed in the following chapter.

George Bush was now the president of his own company, the undisputed boss

of Zapata Offshore. Although the company was falling behind the rest of the

offshore drilling industry, Bush made a desultory attempt at expansion

through diversification, investing in a plastics machinery company in New

Jersey, a Texas pipe lining company, and a gas transmission company; none

of these investments proved to be remunerative.

 

Notes - Chapter 8

1. Harry Hurt III, "George Bush, Plucky Lad," "Texas Monthly," June 1983.

2. See Sarah Bartlett, "The Money Machine: How KKR Manufactured Power and

Profits" (New York, 1991), pp. 9-12.

3. Darwin Payne, "Initiative in Energy: Dresser Industries, Inc.,

1880-1978" (New York: Simon and Schuster, ca. 1979), p. 232 "ff."

4. Bartlett, "op. cit.," p. 268.

5. Darwin Payne, "op. cit.," p. 232-33.

6. Hurt, "op. cit."

7. "Ibid."

8. "Bush Battles the 'Wimp Factor'," "Newsweek," Oct. 19, 1987.

9. See Richard Ben Kramer, "How He Got Here," "Esquire," June 1991.

10. See Thomas Petzinger, Jr., "Oil and Honor: The Texaco-Pennzoil Wars"

(New York, 1987), p. 37 "ff."

11. "Ibid.," p. 93.

12. "Ibid.," p. 40.

13. See Zapata Petroleum annual reports, Library of Congress Microform

Reading Room.

14. Petzinger, "op. cit.," p. 41.

15. See Zapata Petroleum Corporation Annual Report for 1956, Library of

Congress, Microform Reading Room.

16. Hurt, "op. cit.," p. 194.

17. "Zapata Petroleum Corp.," "Fortune," April 1958.

18. Walter Pincus and Bob Woodward, "Doing Well With Help From Family,

Friends," "Washington Post," Aug. 11, 1988.

 

CHAPTER 9

THE BAY OF PIGS AND THE KENNEDY ASSASSINATION

"JM/WAVE ... proliferated across [Florida] in preparation for the Bay of

Pigs invasion. A subculture of fronts, proprietaries, suppliers, transfer

agents, conduits, dummy corporations, blind drops, detective agencies, law

firms, electronic firms, shopping centers, airlines, radio stations, the

mob and the church and the banks: a false and secret nervous system

twitching to stimuli supplied by the cortex in Clandestine Services in

Langley. After defeat on the beach in Cuba, JM/WAVE became a continuing and

extended Miami Station, CIA's largest in the continental United States. A

large sign in front of the ... building complex reads: U.S. GOVERNMENT

REGULATIONS PROHIBIT DISCUSSION OF THIS ORGANIZATION OR FACILITY."

-- Donald Freed, "Death in Washington" (Westport, Connecticut, 1980), p. 141.

The review offered so far of George Bush's activities during the late 1950s

and early 1960s is almost certainly incomplete in very important respects.

There is good reason to believe that Bush was engaged in something more

than just the oil business during those years. Starting about the time of

the Bay of Pigs invasion in the spring of 1961, we have the first hints

that Bush, in addition to working for Zapata Offshore, may also have been a

participant in certain covert operations of the U.S. intelligence

community.

Such participation would certainly be coherent with George's role in the

Prescott Bush, Skull and Bones, and Brown Brothers Harriman networks.

During the twentieth century, the Skull and Bones/Harriman circles have

always maintained a sizeable and often decisive presence inside the

intelligence organizations of the State Department, the Treasury

Department, the Office of Naval Intelligence, the Office of Strategic

Services, and the Central Intelligence Agency.

A body of leads has been assembled which suggests that George Bush may have

been associated with the CIA at some time before the autumn of 1963.

According to Joseph McBride of "The Nation," "a source with close

connections to the intelligence community confirms that Bush started

working for the agency in 1960 or 1961, using his oil business as a cover

for clandestine activities." / Note #1 By the time of the Kennedy

assassination, we have an official FBI document which refers to "Mr. George

Bush of the Central Intelligence Agency," and despite official disclaimers,

there is every reason to think that this is indeed the man in the White

House today.

The mystery of George Bush as a possible covert operator hinges on four

points, each one of which represents one of the great political and

espionage scandals of postwar American history. These four cardinal points

are:

1. The abortive Bay of Pigs invasion of Cuba, launched on April 16-17,

1961, prepared with the assistance of the CIA's "Miami Station" (also known

under the code name JM/WAVE). After the failure of the amphibious landings

of Brigade 2506, Miami station, under the leadership of Theodore Shackley,

became the focus for Operation Mongoose, a series of covert operations

directed against Castro, Cuba, and possibly other targets.

2. The assassination of President John F. Kennedy in Dallas on November 22,

1963, and the coverup of those responsible for this crime.

3. The Watergate scandal, beginning with an April 1971 visit to Miami,

Florida by E. Howard Hunt on the tenth anniversary of the Bay of Pigs

invasion to recruit operatives for the White House Special Investigations

Unit (the "Plumbers" and later Watergate burglars) from among

Cuban-American Bay of Pigs veterans.

4. The Iran-Contra affair, which became a public scandal during

October-November 1986, several of whose central figures, such as Felix

Rodriguez, were also veterans of the Bay of Pigs.

George Bush's role in both Watergate and the October Surprise/Iran-Contra

complex will be treated in detail at later points in this book. Right now,

it is important to see that thirty years of covert operations, in many

respects, form a single continuous whole. This is especially true in regard

to the "dramatis personae." Georgie Anne Geyer points to the obvious in a

recent book: " ... an entire new Cuban cadre now emerged from the Bay of

Pigs. The names Howard Hunt, Bernard Barker, Rolando Martinez, Felix

Rodriguez and Eugenio Martinez would, in the next quarter century, pop up,

often decisively, over and over again in the most dangerous American

foreign policy crises. There were Cubans flying missions for the CIA in the

Congo and even for the Portuguese in Africa; Cubans were the burglars of

Watergate; Cubans played key roles in Nicaragua, in Irangate, in the

American move into the Persian Gulf." / Note #2 Felix Rodriguez tells us

that he was infiltrated into Cuba with the other members of the "Grey Team"

in conjunction with the Bay of Pigs landings; this is the same man we will

find directing the Contra supply effort in Central America during the

1980s, working under the direct supervision of Don Gregg and George Bush. /

Note #3 Theodore Shackley, the JM/WAVE station chief, will later show up in

Bush's 1979-80 presidential campaign.

To a very large degree, such covert operations have drawn upon the same

pool of personnel. They are to a significant extent the handiwork of the

same crowd. It is therefore revealing to extrapolate forward and backward

in time the individuals and groups of individuals who appear as the cast of

characters in one scandal, and compare them with the cast of characters for

the other scandals, including the secondary ones that have not been

enumerated here. E. Howard Hunt, for example, shows up as a confirmed part

of the overthrow of the Guatemalan government of Jacopo Arbenz in 1954, as

an important part of the chain of command in the Bay of Pigs, as a person

repeatedly accused of having been in Dallas on the day Kennedy was shot,

and as one of the central figures of Watergate.

George Bush is demonstrably one of the most important protagonists of the

Watergate scandal, and was the overall director of Iran-Contra. Since he

appears especially in Iran-Contra in close proximity to Bay of Pigs

holdovers, it is surely legitimate to wonder when his association with

those Bay of Pigs Cubans might have started.

1959 was the year that Bush started operating out of his Zapata Offshore

headquarters in Houston; it was also the year that Fidel Castro seized

power in Cuba. Officially, as we have seen, George was now a businessman

whose work took him at times to Louisiana, where Zapata had offshore

drilling operations. George must have been a frequent visitor to New

Orleans. Because of his family's estate on Jupiter Island, he would also

have been a frequent visitor to the Hobe Sound area. And then, there were

Zapata Offshore drilling operations in the Florida strait.

The Jupiter Island connection and father Prescott's Brown Brothers

Harriman/Skull and Bones networks are doubtless the key. Jupiter Island

meant Averell Harriman, Robert Lovett, C. Douglas Dillon and other

Anglophile financiers who had directed the U.S. intelligence community long

before there had been a CIA at all. And, in the backyard of the Jupiter

Island Olympians, and under their direction, a powerful covert operations

base was now being assembled, in which George Bush would have been present

at the creation as a matter of birthright.

 

Operation Zapata

During 1959-60, Allen Dulles and the Eisenhower administration began to

assemble in south Florida the infrastructure for covert action against

Cuba. This was the JM/WAVE capability, later formally constituted as the

CIA Miami station. JM/WAVE was an operational center for the Eisenhower

regime's project of staging an invasion of Cuba using a secret army of

anti-Castro Cuban exiles, organized, armed, trained, transported, and

directed by the CIA. The Cubans, called Brigade 2506, were trained in

secret camps in Guatemala, and they had air support from B-26 bombers based

in Nicaragua. This invasion was crushed by Castro's defending forces in

less than three days.

Before going along with the plan so eagerly touted by Allen Dulles, Kennedy

had established the precondition that under no circumstances whatsoever

would there be direct intervention by U.S. military forces against Cuba. On

the one hand, Dulles had assured Kennedy that the news of the invasion

would trigger an insurrection which would sweep Castro and his regime aw

ay. On the other, Kennedy had to be concerned about provoking a global

thermonuclear confrontation with the U.S.S.R., in the eventuality that

Nikita Khrushchev decided to respond to a U.S. Cuban gambit by, for

example, cutting off U.S. access to Berlin.

Hints of the covert presence of George Bush are scattered here and there

around the Bay of Pigs invasion. According to some accounts, the code name

for the Bay of Pigs was Operation Pluto. / Note #4 But Bay of Pigs veteran

E. Howard Hunt scornfully denies that this was the code name used by

JM/WAVE personnel; Hunt writes: "So perhaps the Pentagon referred to the

Brigade invasion as Pluto. CIA did not." / Note #5 But Hunt does not tell

us what the CIA code name was, and the contents of Hunt's Watergate-era

White House safe, which might have told us the answer, were, of course,

"deep-sixed" by FBI Director Patrick Gray.

According to reliable sources and published accounts, the CIA code name for

the Bay of Pigs invasion was Operation Zapata, and the plan was so referred

to by Richard Bissell of the CIA, one of the plan's promoters, in a

briefing to President Kennedy in the Cabinet Room on March 29, 1961. / Note

#6 Does Operation Zapata have anything to do with Zapata Offshore? The

run-of-the-mill Bushman might respond that Emiliano Zapata, after all, had

been a public figure in his own right, and the subject of a recent

Hollywood movie starring Marlon Brando. A more knowledgeable Bushman might

argue that the main landing beach, the Playa Giron, is located south of the

city of Cienfuegos on the Zapata Peninsula, on the south coast of Cuba.

Then there is the question of the Brigade 2506 landing fleet, which was

composed of five older freighters bought or chartered from the Garcia

Steamship Lines, bearing the names of "Houston," "Rio Escondido," "Caribe,"

"Atlantic," and "Lake Charles." In addition to these vessels, which were

outfitted as transport ships, there were two somewhat better armed fire

support ships, the "Blagar" and the "Barbara." (In some sources "Barbara

J.") / Note #7 The "Barbara" was originally an LCI (Landing Craft Infantry)

of earlier vintage. Our attention is attracted at once to the "Barbara" and

the "Houston," in the first case because we have seen George Bush's habit

of naming his combat aircraft after his wife, and, in the second case,

because Bush was at this time a resident and Republican activist of

Houston, Texas. But of course, the appearance of names like "Zapata,"

"Barbara," and "Houston" can by itself only arouse suspicion, and proves

nothing.

After the ignominious defeat of the Bay of Pigs invasion, there was great

animosity against Kennedy among the survivors of Brigade 2506, some of whom

eventually made their way back to Miami after being released from Castro's

prisoner of war camps. There was also great animosity against Kennedy on

the part of the JM/WAVE personnel.

During the early 1950s, E. Howard Hunt had been the CIA station chief in

Mexico City. As David Atlee Phillips (another embittered JM/WAVE veteran)

tells us in his autobiographical account, "The Night Watch," E. Howard Hunt

had been the immediate superior of a young CIA recruit named William F.

Buckley, the Yale graduate and Skull and Bones member who later founded the

"National Review." In his autobiographical account written during the days

of the Watergate scandal, Hunt includes the following tirade about the Bay

of Pigs:

"No event since the communization of China in 1949 has had such a profound

effect on the United States and its allies as the defeat of the

U.S.-trained Cuban invasion brigade at the Bay of Pigs in April 1961.

"Out of that humiliation grew the Berlin Wall, the missile crisis,

guerrilla warfare throughout Latin America and Africa, and our Dominican

Republic intervention. Castro's beachhead triumph opened a bottomless

Pandora's box of difficulties that affected not only the United States, but

most of its allies in the Free World.

"These bloody and subversive events would not have taken place had Castro

been toppled. Instead of standing firm, our government pyramided crucially

wrong decisions and allowed Brigade 2506 to be destroyed. The Kennedy

administration yielded Castro all the excuse he needed to gain a tighter

grip on the island of Jose Marti, then moved shamefacedly into the shadows

and hoped the Cuban issue would simply melt away." / Note #8

 

Kennedy and MacArthur

Hunt was typical of the opinion that the debacle had been Kennedy's fault,

and not the responsibility of men like Allen Dulles and Richard Bissell,

who had designed it and recommended it. After the embarrassing failure of

the invasion, which never evoked the hoped-for spontaneous anti-Castro

insurrection, Kennedy fired Allen Dulles, his Harrimanite deputy Bissell,

and CIA Deputy Director Charles Cabell (whose brother was the mayor of

Dallas at the time Kennedy was shot).

During the days after the Bay of Pigs debacle, Kennedy was deeply

suspicious of the intelligence community and of proposals for military

escalation in general, including in places like South Vietnam. Kennedy

sought to procure an outside, expert opinion on military matters. For this

he turned to the former commander in chief of the Southwest Pacific Theatre

during World War II, General Douglas MacArthur. Almost ten years ago, a

reliable source shared with one of the authors an account of a meeting

between Kennedy and MacArthur in which the veteran general warned the young

President that there were elements inside the U.S. government who

emphatically did not share his patriotic motives, and who were seeking to

destroy his administration from within. MacArthur warned that the forces

bent on destroying Kennedy were centered in the Wall Street financial

community and its various tentacles in the intelligence community.

It is a matter of public record that Kennedy met with MacArthur in the

latter part of April 1961, after the Bay of Pigs. According to Kennedy aide

Theodore Sorenson, MacArthur told Kennedy, "The chickens are coming home to

roost, and you happen to have just moved into the chicken house." / Note #9

At the same meeting, according to Sorenson, MacArthur "warned [Kennedy]

against the commitment of American foot soldiers on the Asian mainland, and

the President never forgot this advice." / Note #1 / Note #0 This point is

grudgingly confirmed by Arthur M. Schlesinger, a Kennedy aide who had a

vested interest in vilifying MacArthur, who wrote that "MacArthur expressed

his old view that anyone wanting to commit American ground forces to the

mainland [of Asia] should have his head examined." / Note #1 / Note #1

MacArthur restated this advice during a second meeting with Kennedy when

the General returned from his last trip to the Far East in July 1961.

Kennedy valued MacArthur's professional military opinion highly, and used

it to keep at arms length those advisers who were arguing for escalation in

Laos, Vietnam, and elsewhere. He repeatedly invited those who proposed to

send land forces to Asia to convince MacArthur that this was a good idea.

If they could convince MacArthur, then he, Kennedy, might also go along.

At this time, the group proposing escalation in Vietnam (as well as

preparing the assassination of President Diem) had a heavy Brown Brothers

Harriman/Skull and Bones overtone: The hawks of 1961-63 were Harriman,

McGeorge Bundy, William Bundy, Henry Cabot Lodge, and some key London

oligarchs and theoreticians of counterinsurgency wars. And of course,

George Bush during these years was calling for escalation in Vietnam and

challenging Kennedy to "muster the courage" to try a second invasion of

Cuba.

In the meantime, the JM/WAVE-Miami station complex was growing rapidly to

become the largest of Langley's many satellites. During the years after the

failure of the Bay of Pigs, this complex had as many as 3,000 Cuban agents

and subagents, with a small army of case officers to direct and look after

each one. According to one account, there were at least 55 dummy

corporations to provide employment, cover, and commercial disguise for all

these operatives. There were detective bureaus, gun stores, real estate b

rokerages, boat repair shops, and party boats for fishing and other

entertainments. There was the clandestine Radio Swan, later renamed Radio

Americas. There were fleets of specially modified boats based at Homestead

Marina, and at other marinas throughout the Florida Keys. Agents were

assigned to the University of Miami and other educational institutions.

The raison d'etre of the massive capability commanded by Theodore Shackley

was now Operation Mongoose, a program for sabotage raids and assassinations

to be conducted on Cuban territory, with a special effort to eliminate

Fidel Castro personally. In order to run these operations from U.S.

territory, flagrant and extensive violation of federal and state laws was

the order of the day. Documents regarding the incorporation of businesses

were falsified. Income tax returns were faked. FAA regulations were

violated by planes taking off for Cuba or for forward bases in the Bahamas

and elsewhere. Explosives moved across highways that were full of civilian

traffic. The Munitions Act, the Neutrality Act, the customs and

immigrations laws were routinely flaunted. / Note #1 / Note #2

Above all, the drug laws were massively violated as the gallant

anticommunist fighters filled their planes and boats with illegal narcotics

to be smuggled back into the United States when they returned from their

missions. By 1963, the drug-running activities of the covert operatives

were beginning to attract attention. JM/WAVE, in sum, accelerated the slide

of south Florida towards the status of drug and murder capital of the

United States it achieved during the 1980s.

 

The Kennedy Assassination

It cannot be the task of this study even to begin to treat the reasons for

which certain leading elements of the Anglo-American financial oligarchy,

perhaps acting with certain kinds of support from continental European

aristocratic and neofascist networks, ordered the murder of John F.

Kennedy. The British and the Harrimanites wanted escalation in Vietnam; by

the time of his assassination Kennedy was committed to a pullout of U.S.

forces. Kennedy, as shown by his American University speech of 1963, was

also interested in seeking a more stable path of war avoidance with the

Soviets, using the U.S. military superiority demonstrated during the Cuban

missile crisis to convince Moscow to accept a policy of world peace through

economic development. Kennedy was interested in the possibilities of

anti-missile strategic defense to put an end to that nightmare of Mutually

Assured Destruction which appealed to Henry Kissinger, a disgruntled former

employee of the Kennedy administration whom the President had denounced as

a madman.

Kennedy was also considering moves to limit or perhaps abolish the

usurpation of authority over the national currency by the Wall Street and

London interests controlling the Federal Reserve System. If elected to a

second term, Kennedy was likely to reassert presidential control, as

distinct from Wall Street control, over the intelligence community. There

is good reason to believe that Kennedy would have ousted J. Edgar Hoover

from his purported life tenure at the FBI, subjecting that agency to

presidential control for the first time in many years. Kennedy was

committed to a vigorous expansion of the space program, the cultural impact

of which was beginning to alarm the finance oligarchs.

Above all, Kennedy was acting like a man who thought he was President of

the United States, violating the collegiality of oligarchical trusteeship

of that office that had been in force since the final days of Roosevelt.

Kennedy furthermore had two younger brothers who might succeed him, putting

a strong presidency beyond the control of the the Eastern Anglophile

Liberal Establishment for decades. George Bush joined in the Harrimanite

opposition to Kennedy on all of these points.

After Kennedy was killed in Dallas on November 22, 1963, it was alleged

that E. Howard Hunt and Frank Sturgis had both been present, possibly

together, in Dallas on the day of the shooting, although the truth of these

allegations has never been finally established. Both Hunt and Sturgis were

of course Bay of Pigs veterans who would later appear center stage in

Watergate. There were also allegations that Hunt and Sturgis were among a

group of six to eight derelicts who were found in boxcars sitting on the

railroad tracks behind the grassy knoll near Dealey Plaza, and who were

rounded up and taken in for questioning by the Dallas police on the day of

the assassination. Some suspected that Hunt and Sturgis had participated in

the assassination. Some of these allegations were at the center of the

celebrated 1985 defamation case of "Hunt v. Liberty Lobby," in which a

Florida federal jury found against Hunt. But, since the Dallas Police

Department and County Sheriff never photographed or fingerprinted the

"derelicts" in question, it has so far proven impossible definitively to

resolve this question. But these allegations and theories about the

possible presence and activities of Hunt and Sturgis in Dallas were

sufficiently widespread as to compel the Commission on CIA Activities

Within the United States (the Rockefeller Commission) to attempt to refute

them in its 1975 report. / Note #1 / Note #3

According to George Bush's official biography, he was during 1963 a

well-to-do businessman residing in Houston, the busy president of Zapata

Offshore and the chairman of the Harris County Republican Organization,

supporting Barry Goldwater as the GOP's 1964 presidential candidate, while

at the same time actively preparing his own 1964 bid for the U.S. Senate.

But during that same period of time, Bush may have shared some common

acquaintances with Lee Harvey Oswald.

 

The De Mohrenschildt Connection

Between October 1962 and April 1963, Lee Harvey Oswald and his Russian wife

Marina were in frequent contact with a Russian emigre couple living in

Dallas: These were George de Mohrenschildt and his wife Jeanne. During the

Warren Commission investigation of the Kennedy assassination, De

Mohrenschildt was interviewed at length about his contacts with Oswald.

When, in the spring of 1977, the discrediting of the Warren Commission

report as a blatant coverup had made public pressure for a new

investigation of the Kennedy assassination irresistible, the House

Assassinations Committee planned to interview De Mohrenschildt once again.

But in March 1977, just before de Mohrenschildt was scheduled to be

interviewed by Gaeton Fonzi of the House committee's staff, he was found

dead in Palm Beach, Florida. His death was quickly ruled a suicide. One of

the last people to see him alive was Edward Jay Epstein, who was also

interviewing De Mohrenschildt about the Kennedy assassination for an

upcoming book. Epstein is one of the writers on the Kennedy assassination

who enjoyed excellent relations with the late James Angleton of the CIA. If

de Mohrenschildt were alive today, he might be able to enlighten us about

his relations with George Bush, and perhaps afford us some insight into

Bush's activities during this epoch.

Jeanne De Mohrenschildt rejected the finding of suicide in her husband's

death. "He was eliminated before he got to that committee," the widow told

a journalist in 1978, "because someone did not want him to get to it." She

also maintained that George de Mohrenschildt had been surreptitiously

injected with mind-altering drugs. / Note #1 / Note #4

After De Mohrenschildt's death, his personal address book was located, and

it contained this entry: "Bush, George H.W. (Poppy) 1412 W. Ohio also

Zapata Petroleum Midland." There is of course the problem of dating this

reference. George Bush had moved his office and home from Midland to

Houston in 1959, when Zapata Offshore was constituted, so perhaps this

reference goes back to some time before 1959. There is also the number:

"4-6355." There are, of course, numerous other entries, including one W.F.

Buckley of the Buckley brothers of New York City, William S. Paley of CBS,

plus many oil men, stockbrokers, and the like. / Note #1 / Note #5

George De Mohrenschildt recounted a number of different versions of his li

fe, so it is very difficult to establish the facts about him. According to

one version, he was the Russian Count Sergei De Mohrenschildt, but when he

arrived in the United States in 1938 he carried a Polish passport

identifying him as Jerzy Sergius von Mohrenschildt, born in Mozyr, Russia

in 1911. He may in fact have been a Polish officer, or a correspondent for

the Polish News Service, or none of these. He worked for a time for the

Polish Embassy in Washington, D.C. Some say that de Mohrenschildt met the

chairman of Humble Oil, Blaffer, and that Blaffer procured him a job. Other

sources say that during this time De Mohrenschildt was affiliated with the

War Department. According to some accounts, he later went to work for the

French Deuxieme Bureau, which wanted to know about petroleum exports from

the United States to Europe.

De Mohrenschildt in 1941 became associated with a certain Baron Konstantin

von Maydell in a public affairs venture called "Facts and Film." Maydell

was considered a Nazi agent by the FBI, and in September 1942 he was sent

to North Dakota for an internment that would last four years. De

Mohenschildt was also reportedly in contact with Japanese networks at this

time. In June 1941, De Mohrenschildt was questioned by police at Port

Arthur, Texas, on the suspicion of espionage after he was found making

sketches of port facilities. During 1941, De Mohrenschildt applied for a

post in the U.S. Office of Strategic Services (OSS). According to the

official account, he was not hired. Soon after he made the application, he

went to Mexico where he stayed until 1944. In the latter year, he began

study for a master's degree in petroleum engineering at the University of

Texas. According to some accounts, during this period De Mohrenschildt was

investigated by the Office of Naval Intelligence because of alleged

communist sympathies.

After the war, De Mohrenschildt worked as a petroleum engineer in Cuba and

Venezuela, and in Caracas he had several meetings with the Soviet

ambassador. During the postwar years, he also worked in the Rangely oil

field in Colorado. During the 1950s, after having married Winifred

Sharpless, the daughter of an oil millionaire, de Mohrenschildt was active

as an independent oil entrepreneur.

In 1957, De Mohrenschildt was approved by the CIA Office of Security to be

hired as a U.S. government geologist for a mission to Yugoslavia. Upon his

return he was interviewed by one J. Walter Moore of the CIA's Domestic

Contact Service, with whom he remained in contact. During 1958, de

Mohrenschildt visited Ghana, Togo, and Dahomey (now Benin); during 1959, he

visited Africa again and returned by way of Poland. In 1959, he married

Jeanne, his fourth wife, a former ballet dancer and dress designer who had

been born in Manchuria, where her father had been one of the directors of

the Chinese Eastern Railroad.

During the summer of 1960, George and Jeanne De Mohrenschildt told their

friends that they were going to embark on a walking tour of 11,000 miles

along Indian trails from Mexico to Central America. One of their principal

destinations was Guatemala City, where they were staying at the time of the

Bay of Pigs invasion in April 1961, after which they made their way home by

way of Panama and Haiti. After two months in Haiti, the De Mohrenschildts

returned to Dallas, where they came into contact with Lee Harvey Oswald,

who had come back to the United States from his sojourn in the Soviet Union

in June 1962. By this time, de Mohrenschildt was also in frequent contact

with Admiral Henry C. Bruton and his wife, to whom he introduced the

Oswalds. Admiral Bruton was the former director of naval communications.

It is established that between October 1962 and late April 1963, de

Mohrenschildt was a very important figure in the life of Oswald and his

Russian wife. Despite Oswald's lack of social graces, De Mohrenschildt

introduced him into Dallas society, took him to parties, assisted him in

finding employment and much more. It was through De Mohrenschildt that

Oswald met a certain Volkmar Schmidt, a young German geologist who had

studied with Professor Wilhelm Kuetemeyer, an expert in psychosomatic

medicine and religious philosophy at the University of Heidelberg, who

compiled a detailed psychological profile of Oswald. Jeanne and George

helped Marina move her belongings during one of her many estrangements from

Oswald. According to some accounts, De Mohrenschildt's influence on Oswald

was so great during this period that he could virtually dictate important

decisions to the young ex-Marine simply by making suggestions.

According to some versions, de Mohrenschildt was aware of Oswald's alleged

April 10, 1963 attempt to assassinate the well-known right-wing General

Edwin Walker. According to Marina, De Mohrenschildt once asked Oswald,

"Lee, how did you miss General Walker?" On April 19, George and Jeanne De

Mohrenschildt went to New York City, and on April 29, the CIA Office of

Security found that it had no objection to De Mohrenschildt's acceptance of

a contract with the Duvalier regime of Haiti in the field of natural

resource development. De Mohrenschildt appears to have departed for Haiti

on May 1, 1963. In the meantime, Oswald had left Dallas and traveled to New

Orleans.

According to Mark Lane, "there is evidence that De Mohrenschildt served as

a CIA control officer who directed Oswald's actions." Much of the extensive

published literature on de Mohrenschildt converges on the idea that he was

a control agent for Oswald on behalf of some intelligence agency. / Note #1

/ Note #6

It is therefore highly interesting that George Bush's name turns up in the

personal address book of George de Mohrenschildt.

The Warren Commission went to absurd lengths to cover up the fact that

George De Mohrenschildt was a denizen of the world of the intelligence

agencies. This included ignoring the well-developed paper trail on De

Mohrenschildt as Nazi and communist sympathizer, and later as a U.S. asset

abroad. The Warren Commission concluded:

"The Commission's investigation has developed no signs of subversive or

disloyal conduct on the part of either of the de Mohrenschildts. Neither

the FBI, CIA, nor any witnesses contacted by the Commission has provided

any information linking the De Mohrenschildts to subversive or extremist

organizations. Nor has there been any evidence linking them in any way with

the assassination of President Kennedy." / Note #1 / Note #7

 

Bush, the CIA, and Kennedy

On the day of the Kennedy assassination, FBI records show George Bush as

reporting a right-wing member of the Houston Young Republicans for making

threatening comments about President Kennedy. According to FBI documents

released under the Freedom of Information Act,

"On November 22, 1963 Mr. GEORGE H.W. BUSH, 5525 Briar, Houston, Texas,

telephonically advised that he wanted to relate some hear say that he had

heard in recent weeks, date and source unknown. He advised that one JAMES

PARROTT had been talking of killing the President when he comes to Houston.

"PARROTT is possibly a student at the University of Houston and is active

in politics in the Houston area."

According to related FBI documentation, "a check with Secret Service at

Houston, Texas revealed that agency had a report that PARROTT stated in

1961 he would kill President Kennedy if he got near him." Here Bush is

described as "a reputable businessman." FBI agents were sent to interrogate

Parrott's mother, and later James Milton Parrott himself. Parrott had been

discharged from the U.S. Air Force for psychiatric reasons in 1959. Parrott

had an alibi for the time of the Dallas shootings; he had been in the

company of another Republican activist. According to press accounts,

Parrott was a member of the right-wing faction of the Houston GOP, which

was oriented toward the John Birch Society and which opposed Bush's

chairmanship. / Note #1 / Note #8 According to the "San Francisco

Examiner," Bush's press office in August 1988 first said that Bush had not

made any such call, and challenged the authenticity of the FBI documents.

Several days later Bush's spokesman said that the candi date "does not

recall" placing the call.

One day after he reported Parrott to the FBI, Bush received a highly

sensitive, high-level briefing from the Bureau:

"Date: November 29, 1963

"To: Director of Intelligence and Research Department of State

"From: John Edgar Hoover, Director

"Subject: ASSASSINATION OF PRESIDENT JOHN F. KENNEDY, NOVEMBER 22, 1963

"Our Miami, Florida Office on November 23, 1963 advised that the Office of

Coordinator of Cuban Affairs in Miami advised that the Department of State

feels some misguided anti-Castro group might capitalize on the present

situation and undertake an unauthorized raid against Cuba, believing that

the assassination of President John F. Kennedy might herald a change in

U.S. policy, which is not true.

"Our sources and informants familiar with Cuban matters in the Miami area

advise that the general feeling in the anti-Castro Cuban community is one

of stunned disbelief and, even among those who did not entirely agree with

the President's policy concerning Cuba, the feeling is that the President's

death represents a great loss not only to the U.S. but to all Latin

America. These sources know of no plans for unauthorized action against

Cuba.

"An informant who has furnished reliable information in the past and who is

close to a small pro-Castro group in Miami has advised that those

individuals are afraid that the assassination of the President may result

in strong repressive measures being taken against them and, although

pro-Castro in their feelings, regret the assassination.

"The substance of the foregoing information was orally furnished to Mr.

George Bush of the Central Intelligence Agency and Captain William Edwards

of the Defense Intelligence Agency on November 23, 1963, by Mr. W.T.

Forsyth of this Bureau."

William T. Forsyth, since deceased, was an official of the FBI's Washington

headquarters; during the time he was attached to the bureau's subversive

control section, he ran the investigation of Dr. Martin Luther King. Was he

also a part of the FBI's harassment of Dr. King?

The efforts of journalists to locate Captain Edwards have not been successful.

This FBI document identifying George Bush as a CIA agent in November 1963

was first published by Joseph McBride in "The Nation" in July 1988, just

before Bush received the Republican nomination for President. McBride's

source observed: "I know [Bush] was involved in the Caribbean. I know he

was involved in the suppression of things after the Kennedy assassination.

There was a very definite worry that some Cuban groups were going to move

against Castro and attempt to blame it on the CIA." / Note #1 / Note #9

When pressed for confirmation or denial, Bush's spokesman Stephen Hart

commented: "Must be another George Bush."

Within a short time, the CIA itself would peddle the same damage control

line. On July 19, 1988, in the wake of wide public attention to the report

published in "The Nation," CIA spokeswoman Sharron Basso departed from the

normal CIA policy of refusing to confirm or deny reports that any person is

or was a CIA employee. CIA spokeswoman Basso told the Associated Press that

the CIA believed that "the record should be clarified." She said that the

FBI document "apparently" referred to a George William Bush who had worked

in 1963 on the night shift at CIA headquarters, and that "would have been

the appropriate place to have received such an FBI report." According to

her account, the George William Bush in question had left the CIA to join

the Defense Intelligence Agency in 1964.

For the CIA to volunteer the name of one of its former employees to the

press was a shocking violation of traditional methods, which are supposedly

designed to keep such names a closely guarded secret. This revelation may

have constituted a violation of federal law. But no exertions were too

great when it came to damage control for George Bush.

George William Bush had indeed worked for the CIA, the DIA, and the

Alexandria, Virginia Department of Public Welfare before joining the Social

Security Administration, in whose Arlington, Virginia office he was

employed as a claims representative in 1988. George William Bush told "The

Nation" that while at the CIA he was "just a lowly researcher and analyst"

who worked with documents and photos and never received interagency

briefings. He had never met Forsyth of the FBI or Captain Edwards of the

DIA. "So it wasn't me," said George William Bush. / Note #2 / Note #0

Later, George William Bush formalized his denial in a sworn statement to a

federal court in Washington, D.C. The affidavit acknowledges that while

working at CIA headquarters between September 1963 and February 1964,

George William Bush was the junior person on a three- to four-man watch

which was on duty when Kennedy was shot. But, as George William Bush goes

on to say, "have carefullyreviewed the FBI memorandum to the Director,

Bureau of Intelligence and Research, Department of State dated November 29,

1963 which mentions a Mr. George Bush of the Central Intelligence

Agency.... I do not recognize the contents of the memorandum as information

furnished to me orally or otherwise during the time I was at the CIA. In

fact, during my time at the CIA, I did not receive any oral communications

from any government agency of any nature whatsoever. I did not receive any

information relating to the Kennedy assassination during my time at the CIA

from the FBI.

"Based on the above, it is my conclusion that I am not the Mr. George Bush

of the Central Intelligence Agency referred to in the memorandum." / Note

#2 / Note #1

So we are left with the strong suspicion that the "Mr. George Bush of the

CIA" referred to by the FBI is our own George Herbert Walker Bush, who, in

addition to his possible contact with Lee Harvey Oswald's controller, may

thus also join the ranks of the Kennedy assassination coverup. It makes

perfect sense for George Bush to be called in on a matter involving the

Cuban community in Miami, since that is a place where George has

traditionally had a constituency. George inherited it from his father,

Prescott Bush of Jupiter Island, and later passed it on to his own son,

Jeb.

 

Notes to Chapter 9

1. Joseph McBride, "|'George Bush,' C.I.A. Operative," "The Nation" July

16, 1988.

2. Georgie Anne Geyer, "Guerrilla Prince" (Boston: Little, Brown, 1991).

3. Felix Rodriguez, "Shadow Warrior" (New York: Simon and Schuster, 1989).

4. On Pluto, see the East German study by Guenter Schumacher, "Operation

Pluto" (Berlin, Deutscher Militarverlag, 1966).

5. E. Howard Hunt, "Give Us This Day" (New Rochelle: Arlington House,

1973), p. 214.

6. For Operation Zapata, see Michael R. Beschloss, "The Crisis Years:

Kennedy and Khrushchev, 1960-63" (New York: Edward Burlingame Books, 1991),

p. 89.

7. For the names of the ships at the Bay of Pigs, see Quintin Pino Machado,

"La Batalla de Giron" (La Habana: Editorial de Ciencias Sociales, 1983),

pp. 79-80. This source quotes one ship as the "Barbara J." See also

Schumacher, "Operation Pluto," pp. 98-99. See also Peter Wyden, "Bay of

Pigs, The Untold Story" (New York: Simon and Schuster, 1979), which also

has the "Barbara J." According to Quintin Pino Machado, the "Houston" had

been given the new name of "Aguja" (Swordfish) and the "Barbara" that of

"Barracuda" for the purposes of this operation.

8. E. Howard Hunt, "op. cit.," pp. 13-14.

9. Theodore Sorenson, "Kennedy" (New York: Bantam, 1966), p. 329.

10. "Ibid.," p. 723.

11. Arthur M. Schlesinger, "A Thousand Days" (Boston, 1965), p. 339.

12. See Warren Hinckle and William W. Turner, "The Fish is Red" (New York:

Harper and Row, 1981), pp. 112 ff.

13. "Report to the President by the Commission on CIA Activities Within the

United States" (Washington: U.S. Government Printing Office, 1975), pp.

251-267.

14. Jim Marrs, "Widow disputes suicide," "Fort Worth Evening

Star-Telegram," May 11, 1978.

15. A photocopy of George de Mohrenschildt's personal address book is

preserved at the Assassination Archives and Research Center, Washington,

D.C. The Bush entry is also cited in Mark Lane, "Plausible Denial" (New

York: Thunder's Mou th Press, 1991), p. 332.

16. For De Mohrenschildt, see Mark Lane, "op. cit."; Edward Jay Epstein,

"Legend: The Secret World of Lee Harvey Oswald" (London: Hutchinson, 1978);

C. Robert Blakey and Richard N. Billings, "The Plot to Kill the President"

(New York: Times Books, 1981); and Robert Sam Anson, ""They've Killed The

President!"" (New York: Bantam, 1975).

17. "Report of the Warren Commission on the Assassination of President

Kennedy" (New York: Bantam, 1964), p. 262.

18. Miguel Acoca, "FBI: 'Bush' called about JFK killing," "San Francisco

Examiner," Aug. 25, 1988.

19. Joseph McBride, "|'George Bush,' CIA Operative," "The Nation," July

16/23, 1988, p. 42.

20. Joseph McBride, "Where "Was" George?" "The Nation," Aug. 13/20, 1988,

p. 117.

21. United States District Court for the District of Columbia, Civil Action

88-2600 GHR, Assassination Archives and Research Center v. Central

Intelligence Agency, Affidavit of George William Bush, Sept. 21, 1988.

 

CHAPTER 10

PART I

THE SENATE RACE

Bush's unsuccessful attempt in 1964 to unseat Texas Democratic "Senator

Ralph Yarborough" is a matter of fundamental interest to anyone seeking to

probe the wellsprings of Bush's actual political thinking. In a society

which knows nothing of its own recent history, the events of a

quarter-century ago might be classed as remote and irrelevant. But as we

review the profile of the Bush Senate campaign of 1964, what we see coming

alive is the characteristic mentality that rules the Oval Office today. The

main traits are all there: the overriding obsession with the race issue,

exemplified in Bush's bitter rejection of the civil rights bill before the

Congress during those months; the genocidal bluster in foreign affairs,

with proposals for nuclear bombardment of Vietnam, an invasion of Cuba, and

a rejection of negotiations for the return of the Panama Canal; the

autonomic reflex for union-busting expressed in the rhetoric of "right to

work"; the paean to free enterprise at the expense of farmers and the

disadvantaged, with all of this packaged in a slick, demagogic television

and advertising effort....

Bush's opponent, Senator Ralph Webster Yarborough, had been born in

Chandler, Texas in 1903 as the seventh of 11 children. After graduating

from Tyler High School as Salutatorian, he received an appointment to the

U.S. Military Academy at West Point, which he attended for one year. After

working in the wheat fields of Oklahoma and a six-month stint teaching in a

small rural school, he went on to Sam Houston State Teachers College for

two terms. He was a member of the 36th Division of the Texas National

Guard, in which he advanced from private to sergeant. After World War I, he

worked a passage to Europe on board a freighter, and found a job in Germany

working in the offices of the American Chamber of Commerce in Berlin. He

also pursued studies in Stendahl, Germany. He returned to the United States

to earn a law degree at the University of Texas in 1927, and worked as a

lawyer in El Paso.... Yarborough entered public service as an assistant

attorney general of Texas from 1931 to 1934. After that, he was a founding

director of the Lower Colorado River Authority, a major water project in

central Texas, and was then elected as a district judge in Austin.

Yarborough served in the U.S. Army ground forces during World War II, and

was a member of the only division which took part in the postwar occupation

of Germany as well as in MacArthur's administration of Japan. When he left

the military in 1946, he had attained the rank of lieutenant colonel. It is

clear from an overview of Yarborough's career that his victories and

defeats were essentially his own, that for him there was no Prescott Bush

to secure lines of credit or to procure important posts by telephone calls

to bigwigs in freemasonic networks.

Yarborough had challenged Allan Shivers in the governor's contest of 1952,

and had gone down to defeat. Successive bids for the state house in Austin

by Yarborough were turned back in 1954 and 1956. Then, when Senator (and

former Governor) Price Daniel resigned his seat, Yarborough was finally

victorious in a special election. He had then been reelected to the Senate

for a full term in 1958.

 

Yarborough in the Senate

Yarborough was distinguished first of all for his voting record on civil

rights. Just months after he had entered the Senate, he was one of only

five southern senators (including LBJ) to vote for the watershed Civil

Rights Act of 1957. In 1960, Yarborough was one of four southern senators

-- again including LBJ -- who cast votes in favor of the Civil Rights Act

of 1960. Yarborough would be the lone senator from the 11 states formerly

comprising the Confederate States of America to vote for the 1964 Civil

Rights Bill, the most sweeping since Reconstruction. This is the bill

which, as we will see, provided Bush with the ammunition for one of the

principal themes of his 1964 election attacks. Later, Yarborough would be

one of only three southern senators supporting the Voting Rights Act of

1965, and one of four supporting the 1968 open housing bill. / Note #5

... Yarborough had become the chairman of the Senate Committee on Labor and

Public Welfare. Here his lodestar was infrastructure: infrastructure in the

form of education and infrastructure in the form of physical improvements.

In education, Yarborough was either the author or a leading supporter of

virtually every important piece of legislation to become law between 1958

and 1971, including some nine major bills. As a freshman senator,

Yarborough was the co-author of the National Defense Education Act of 1958,

which was the basis for federal aid to education, particularly to higher

education. Under the provisions of NDEA, a quarter of a million students

were at any given time enabled to pursue undergraduate training with

low-cost loans and other benefits. For graduate students, there were

three-year fellowships that paid tuition and fees plus grants for living

expenses in the amount of $2200, $2400 and $2600 over the three years -- an

ample sum in those days. Yarborough also sponsored bills for medical

education, college classroom construction, vocational education, aid to the

mentally retarded, and library facilities. Yarborough's Bilingual Education

Bill provided special federal funding for schools with large numbers of

students from non-English speaking backgrounds. Some of these points were

outlined by Yarborough during a campaign speech of September 18, 1964, with

the title "Higher Education As It Relates To Our National Purpose."

As chairman of the veterans subcommittee, Yarborough authored the Cold War

G.I. Bill, which sought to extend the benefits accorded veterans of World

War II and Korea, and which was to apply to servicemen on duty between

January 1955 and July 1, 1965. For these veterans, Yarborough proposed

readjustment assistance, educational and vocational training, and loan

assistance, to allow veterans to purchase homes and farms at a maximum

interest rate of 5.25 percent per annum. This bill was finally passed after

years of dogged effort by Yarborough against the opposition of Presidents

Eisenhower, Kennedy and Johnson. Yarborough was instrumental in obtaining a

five-year extension of the Hill-Burton Act, which provided 4,000 additional

beds in Veterans Administration hospitals.

In physical improvements, Yarborough supported appropriations for coastal

navigation. He fought for $29 million for the Rural Electrification

Administration for counties in the Corpus Christi area alone. In 11

counties in that part of Texas, Yarborough had helped obtain federal grants

of $4.5 million and loans of $640,000 under the Kennedy administration

accelerated public works projects program, to provide clean water and

sewage for towns and cities which could not otherwise afford them.

Concerning his commitment to this type of infrastructure, Yarborough

commented to a dinner in Corpus Christi:

"These are the projects, along with ship channels, dams and reservoirs,

water research programs, hurricane and flood control programs, that bring

delegations of city officials, me mbers of county courts, members of river

and watershed authorities, co-op delegations, into my office literally by

the thousands year after year for aid, which is always given, never

refused." Yarborough went on: "While our efforts and achievements are

largely unpublicized .. there is satisfaction beyond acclaim when a small

town without a water system is enabled to provide its people for the first

time with water and sewerage ... when the course of a river is shored up a

little to save a farmer's crops, when a freeway opens up new avenues of

commerce." / Note #6 In the area of oil policy, always vital in Texas,

Yarborough strained to give the industry everything it could reasonably

expect, and more. Despite this, he was implacably hated by many business

circles.

In short, Ralph Yarborough had a real commitment to racial and

economicjustice, and was, all in all, among the best that the post-New Deal

Democratic Party had to offer. Certainly there were weaknesses: One of the

principal ones was to veer in the direction of environmentalism. Here

Yarborough was the prime mover behind the Endangered Species Act.

 

Climbing the Republican Ladder

Bush moved to Houston in 1959, bringing the corporate headquarters of

Zapata Offshore with him. Houston was by far the biggest city in Texas, a

center of the corporate bureaucracies of firms doing business in the oil

patch. There was also the Baker and Botts law firm, which would function in

effect as part of the Bush family network, since Baker and Botts were the

lawyers who had been handling the affairs of the Harriman railroad

interests in the Southwest.

One prominent lawyer in Houston at the time was "James Baker III," a scion

of the family enshrined in the Baker and Botts name, but himself a partner

in another, satellite firm, because of the so-called anti-nepotism rule

that prevented the children of Baker and Botts partners from joining the

firm themselves. Soon Bush would be hob-nobbing with Baker and other

representatives of the Houston oligarchy, of the Hobby and Cullen families,

at the Petroleum Club and at garden parties in the hot, humid, subtropical

summers. George, Barbara and their children moved into a new home on Briar

Drive....

Before long, Bush became active in the Harris County Republican Party,

which was in the process of becoming one of the GOP strongpoints in the

statewide apparatus then being assembled by Peter O'Donnell, the Republican

state chairman, and his associate Thad Hutcheson. By now, George Bush

claimed to have become a millionaire in his own right, and given his

impeccable Wall Street connections, it was not surprising to find him on

the Harris County GOP finance committee, a function that he had undertaken

in Midland for the Eisenhower-Nixon tickets in 1952 and 1956. He was also a

member of the candidates committee.

In 1962, the Democrats were preparing to nominate John Connally for

governor, and the Texas GOP under O'Donnell was able to mount a more

formidable bid than previously for the state house in Austin. The

Republican candidate was Jack Cox, a party activist with a right-wing

profile. Bush agreed to serve as the Harris County co-chairman of the Jack

Cox for Governor finance committee. In the gubernatorial election of 1962,

Cox received 710,000 votes, a surprisingly large result. Connally won the

governorship, and it was in that capacity that he was present in the

Kennedy motorcade in Dallas on November 22, 1963.

During these years, a significant influence was exercised in the Texas GOP

by the John Birch Society, which had grown up during the 1950s through the

leadership and financing of Robert Welch. Grist for the Birch mill was

abundantly provided by the liberal Republicanism of the Eisenhower

administration, which counted Prescott Bush, Nelson Rockefeller, Gordon

Gray and Robert Keith Gray among its most influential figures. In reaction

against this Wall Street liberalism, the Birchers offered an ideology of

impotent negative protest based on self-righteous chauvinism in foreign

affairs and the mystifications of the free market at home. But they were

highly suspicious of the financier cliques of lower Manhattan, and to that

extent they had George Bush's number.

Bush is still complaining about the indignities he suffered at the hands of

these Birchers, with whom he was straining to have as much as possible in

common. But he met with repeated frustration, because his Eastern Liberal

Establishment pedigree was always there. In his campaign autobiography,

Bush laments that many Texans thought that "Redbook Magazine," published by

his father-in-law, Marvin Pierce of the McCall Corporation, was an official

publication of the Communist Party.

Bush recounts a campaign trip with his aide Roy Goodearle to the Texas

panhandle, during which he was working a crowd at one of his typical free

food, free beer "political barbecues." Bush gave one of his palm cards to a

man who conceded that he had heard of Bush, but quickly added that he could

never support him. Bush thought this was because he was running as a

Republican. "But," [Bush] then realized, "my being a Republican wasn't the

thing bothering the guy. It was something worse than that." Bush's

interlocutor was upset over the fact that Zapata Offshore had eastern

investors. When Bush whined that all oil companies had eastern investors,

for such was the nature of the business, his tormentor pointed out that one

of Bush's main campaign contributors, a prominent Houston attorney, was not

just a "sonofabitch," but also a member of the New York Council on Foreign

Relations.

Bush explains, with the whine in his larynx in overdrive: "The lesson was

that in the minds of some voters the Council on Foreign Relations was

nothing more than a One World tool of the Communist-Wall Street

internationalist conspiracy, and to make matters worse, the Houston lawyer

had also worked for President Eisenhower -- a known tool of the Communists,

in the eyes of some John Birch members." Further elucidation is then added

in a footnote: "A decade and a half later, running for President, I ran

into some of the same political types on the campaign trail. By then,

they'd uncovered an international conspiracy even more sinister than the

Council on Foreign Relations -- the Trilateral Commission, a group that

President Reagan received at the White House in 1981." / Note #7

This, as we shall see, is a reference to the primary campaign of 1979-80, which included the exposure of Bush's

membership not just in David Rockefeller's Trilateral Commission, but also

in Skull and Bones, about which Bush always refuses to comment. When Ronald

Reagan and other candidates took up this issue, Bush ended up losing the

New Hampshire primary, and with it, his best hope of capturing the

presidency in 1980. Bush, in short, has been aware since the early sixties

that serious attention to his oligarchical pedigree causes him to lose

elections. His response has been to seek to declare these very relevant

matters off limits, and to order dirty tricks and covert operations against

those who persist in making this an issue.

Part of the influence of the Birch Society in those days was due to the

support and financing afforded by the Hunt dynasty of Dallas. In

particular, the fabulously wealthy oilman "H.L. Hunt," one of the richest

men in the world, was an avid sponsor of rightwing propaganda which he put

out under the name of LIFE LINE. On at least one occasion, Hunt called Bush

to Dallas for a meeting during one of the latter's Texas political

campaigns. "There's something I'd like to give you," Hunt told Bush. Bush

appeared with remarkable alacrity, and Hunt engaged him in a long

conversation about many things, but mentioned neither politics nor money.

Finally, as Bush was getting ready to leave, Hunt handed him a thick brown

envelope. Bush eagerly opened the envelope in the firm expectation that it

would contain a large sum in cash. What he found instead was a thick wad of

LIFE LINE literature for his ideological reformation. / Note #8

It was in this context that George Bush, mediocre oilman, fortified by his

Wall Street and Skull and Bones connections, but with almost no visible

qualifications, and scarcely known in Texas outside of Odessa, Midland and

Houston, decided that he had attained senatorial caliber. In the Roman

Empire, membership in the Senate was an hereditary attribute of patrician

family rank. Prescott Bush had left the Senate in early January of 1963.

Before the year was out, George Bush would make his claim. As Senator

Yarborough later commented, it would turn out to be an act of temerity.

 

Harris County Chair

During the spring of 1963, Bush set about assembling an institutional base

for his campaign. The chosen vehicle would be the Republican chairmanship

of Harris County, the area around Houston, a bulwark of the Texas GOP. Bush

had been participating in the Harris County organization since 1960.

One Sunday morning, Bush invited some county Republican activists to his

home on Briar Drive. Present were "Roy Goodearle," a young independent oil

man who, before Barbara Bush appropriated it, was given the nickname of

"the Silver Fox" in the Washington scene. Also present were Jack Steel, Tom

and Nancy Thawley, and some others.

Goodearle, presumably acting as the lawyer for the Bush faction, addressed

the meeting on the dangers posed by the sectarians of the John Birch

Society to the prospects of the GOP in Houston and elsewhere. Over lunch

prepared by Barbara Bush, Goodearle outlined the tactical situation in the

Harris County organization: A Birchite faction under the leadership of

state senator Walter Mengdon, although still a minority, was emerging as a

powerful inner-party opposition against the liberals and moderates. In the

last vote for GOP county leader, the Birch candidate had been narrowly

defeated. Now, after three years in office, the more moderate county

chairman, James A. Bertron, would announce on February 8, 1963 that he

could no longer serve as chairman of the Harris County Republican Executive

Committee. His resignation, he would state, was "necessitated by neglect of

my personal business due to my political activities." / Note #9 This was

doubtless very convenient in the light of what Bush had been planning.

Bertron was quitting to move to Florida. In 1961, Bertron had been

attending a Republican fundraising gathering in Washington, D.C., when he

was accosted by none other than Senator Prescott Bush. Bush took Bertron

aside and demanded: "Jimmy, when are you going to get George involved?"

"Senator, I'm trying," Bertron replied, evidently with some vexation.

"We're all trying." / Note #1 / Note #0 In 1961 or at any other time, it is

doubtful that George Bush could have found his way to the men's room

without the help of a paid informant sent by Senator Prescott Bush.

Goodearle went on to tell the assembled Republicans that unless a "strong

candidate" now entered the race, a Bircher was likely to win the post of

county chairman. But in order to defeat the well-organized and zealous

Birchers, said Goodearle, an anti-Bircher would have to undertake a

grueling campaign, touring the county and making speeches to the Republican

faithful every night for several weeks. Then, under the urging of

Goodearle, the assembled group turned to Bush: Could he be prevailed on to

put his hat in the ring? Bush, by his own account, needed no time to think

it over, and accepted on the spot.

With that, George and Barbara were on the road in their first campaign in

what Bush later called "another apprenticeship." While Barbara busied

herself with needlepoint in order to stay awake through a speech she had

heard repeatedly, George churned out a pitch on the virtues of the

two-party system and the advantages of having a Republican alternative to

the entrenched Houston establishment. In effect, his platform was the

Southern Strategy "avant la lettre." Local observers soon noticed that

Barbara Bush was able to gain acceptance as a campaign comrade for

Republican volunteers, in addition to being esteemed as the wealthy

candidate's wife.

When the vote for county chairman came, the candidate opposing Bush,

Russell Prior, pulled out of the race for reasons that have not been

satisfactorily explained, thus permitting Bush to be elected unanimously by

the executive committee. Henceforth, winning unopposed has been Bush's

taste in elections: This is how he was returned to the House for his second

term in 1968, and Bush propagandists flirted with a similar approach to the

1992 presidential contest.

As chairman, Bush was free to appoint the officers of the county GOP. Some

of these choices are not without relevance for the future course of world

history. For the post of party counsel, Bush appointed William B. Cassin of

Baker and Botts, Shepherd and Coates law firm. For his assistant county

chairmen, Bush tapped Anthony Farris, Gene Crossman and Roy Goodearle; and

for executive director, William R. Simmons.

Not to be overloooked is the choice of Anthony J.P. "Tough Tony" Farris. He

had been a Marine gunner aboard dive bombers and torpedo bombers during the

war, and had later graduated from the University of Houston law school,

subsequently setting up a general law practice in the Sterling Building in

downtown Houston. The "P" stood for Perez, and Farris was a wheelhorse in

the Mexican-American community with the "Amigos for Bush" in a number of

campaigns. Farris was an unsuccessful congressional candidate, but was

later rewarded by the Nixon administration with the post of United States

Attorney in Houston. Then Farris was elected to the Harris County bench in

1980. When George Bush's former business partner and constant crony, J.

Hugh Liedtke of Pennzoil, sued Texaco for damages in the celebrated Getty

Oil case of 1985, it was Judge "Tough Tony" Farris who presided over most

of the trial and made the key rulings on the way to the granting of the

biggest damage award in history, an unbelievable $11,120,976,110.83, all

for the benefit of Bush's good friend J. Hugh Liedtke. / Note #1 / Note #2

... At the same time that he was inveighing against extremism, Bush was

dragooning his party apparatus to mount the Houston Draft Goldwater drive.

The goal of this effort was to procure 100,000 signatures for Goldwater,

with each signer also plunking down a dollar to fill the GOP coffers. "An

excellent way for those who support Goldwater -- like me -- to make it

known," opined Chairman George. Bush fostered a partisan -- one might say

vindictive -- mood at the county GOP headquarters: The "Houston Chronicle"

of June 6, 1963 reports that GOP activists were amusing themselves by

tossing darts at balloons suspended in front of a photograph of President

Johnson. Bush told the "Chronicle": "I saw the incident and it did not

offend me. It was just a gag."

But Bush's pro-Goldwater efforts were not universally appreciated. In early

July, Craig Peper, the current chairman of the party finance committee,

stood up in a party gathering and attacked the leaders of the Draft

Goldwater movement, including Bush as "right wing extremists." Bush had not

been purging any Birchers, but he was not willing to permit such attacks

from his left. Bush accordingly purged Peper, demanding his resignation

after a pro-Goldwater meeting at which Bush had boasted that he was "100

percent for the draft Goldwater move."

A few weeks after ousting Peper, Bush contributed one of his first public

political statements as an op ed in the "Houston Chronicle" of July 28,

1963. Concerning the recent organizational problems, he whined that the

county organization was "afflicted with some dry-martini critics who talk

and don't work." Then, in conformity with his family doctrine and his own

dominant obsession, Bush turned to the issue of race. As a conservative, he

had to lament that fact that "Negroes" "think that conservatism means

segregation." Nothing could be further from the truth. This was rather the

result of slanderous propaganda which Republican public relations men had

not sufficiently refuted: "First, they attempt to present us as racists.

The Republican party of Harris County is not a racist party. We have not

present ed our story to the Negroes in the county. Our failure to attract

the Negro voter has not been because of a racist philosophy; rather, it has

been a product of our not having had the organization to tackle all parts

of the county." What then was the GOP line on the race question? "We

believe in the basic premise that the individual Negro surrenders the very

dignity and freedom he is struggling for when he accepts money for his vote

or when he goes along with the block vote dictates of some Democratic boss

who couldn't care less about the quality of the candidates he is pushing."

So the GOP would try to separate the black voter from the Democrats. Bush

conceded: "We have a tough row to hoe here."

After these pronouncements on race, Bush then went on to the trade union

front. Yarborough's labor backing was exceedingly strong, and Bush lost no

time in assailing thestate AFL-CIO and its Committee on Political

Education (COPE) for gearing up to help Yarborough in his race. For Bush,

this meant that the AFL-CIO was not supporting the "two-party system." "A

strong pitch is being made to dun the [union] membership to help elect

Yarborough," he charged, "long before Yarborough's opponent is even known."

Bush also spoke out during this period on foreign affairs. He demanded that

President Kennedy "muster the courage" to undertake a new attack on Cuba. /

Note #1 / Note #3

Before announcing his bid for the senate, Bush decided to take out what

would appear in retrospect to be a very important insurance policy for his

future political career. On April 22, Bush, with the support of Republican

state chairman Peter O'Donnell, filed a suit in federal court, calling for

the reapportionment of the congressional districts in the Houston area. The

suit argued that the urban voters of Harris County were being partially

disenfranchised by a system that favored rural voters, and demanded as a

remedy that a new congressional district be drawn in the area. "This is not

a partisan matter," commented the civic-minded Bush. "This is something of

concern to all Harris County citizens." Bush would later win this suit, and

that would lead to a court-ordered redistricting, which would create the

Seventh Congressional District, primarily out of those precincts which Bush

managed to carry in the 1964 Senate race. Was this the invisible hand of

Skull and Bones? This would also mean that there would be no entrenched

incumbent, no incumbent of any kind in that Seventh District, when Bush got

around to making his bid there in 1966. But for now, this was all still in

the future.

 

The Senate Race

On September 10, 1963, Bush announced his campaign for the U.S. Senate. He

was fully endorsed by the state Republican organization and its chairman,

Peter O'Donnell, who, according to some accounts, had encouraged Bush to

run. By December 5, Bush had further announced that he was planning to step

down as Harris County chairman and devote himself to full-time, statewide

campaigning starting early in 1964.

At this point, Bush's foremost strategic concern appears to have been money

-- big money. On October 19, the "Houston Chronicle" carried his comment

that ousting Yarborough would require nearly $2 million, "if you want to do

it right." Much of this would go to the Brown and Snyder advertising agency

in Houston for television and billboards. In 1963, this was a considerable

sum, but Bush's crony C. Fred Chambers, also an oilman, was committed to

raising it. During these years, Chambers appears to have been one of Bush's

closest friends, and he received the ultimate apotheosis of having one of

the Bush family dogs named in his honor. / Note #1 / Note #4

It is impossible to establish in retrospect how much Bush spent in this

campaign. State campaign finance filings do exist, but they are fragmentary

and grossly underestimate the money that was actually committed.

In terms of the tradeoffs of the campaign, Bush and his handlers were

confronted with the following configuration: There were three competitors

for the Republican senatorial nomination. The most formidable competition

came from Jack Cox, the Houston oilman who had run for governor against

Connally in 1962, and whose statewide recognition was much higher than

Bush's. Cox would position himself to the right of Bush, and would receive

the endorsement of General Edwin Walker, who had been forced to resign his

infantry command in Germany because of his radical speeches to the troops.

A former Democrat, Cox was reported to have financial backing from the

Hunts of Dallas. Cox campaigned against medicare, federal aid to education,

the war on poverty, and the loss of U.S. sovereignty to the U.N.

Competing with Cox was Dr. Milton Davis, a thoracic surgeon from Dallas,

who was expected to be the weakest candidate but whose positions were

perhaps the most distinctive: Morris was for "no treaties with Russia," the

repeal of the federal income tax, and the "selling off of excess government

industrial property such as TVA and REA" -- what the Reagan-Bush

administrations would later call privatization.

Competing with Bush for the less militant conservatives was Dallas lawyer

Robert Morris, who recommended depriving the U.S. Supreme Court of

appellate jurisdiction in school prayer cases. / Note #1 / Note #5 In order

to avoid a humiliating second-round runoff in the primary, Bush would need

to score an absolute majority the first time around. To do that he would

have to first compete with Cox on a right-wing terrain, and then move to

the center after the primary, in order to take votes from Yarborough there.

But there was also primary competition on the Democratic side for

Yarborough. This was Gordon McLendon, the owner of a radio network, the

Liberty Broadcasting System, that was loaded with debt. Liberty

Broadcasting's top creditor was Houston banker Roy Cullen, a Bush crony.

Roy Cullen's name appears, for example, along with such died-in-the wool

Bushmen as W.S. Farish III, James A. Baker III, C. Fred Chambers, Robert

Mosbacher, William C. Liedtke, Jr., Joseph R. Neuhaus and William B.

Cassin, in a Bush campaign ad in the "Houston Chronicle" of late April,

1964. When McLendon finally went bankrupt, it was found that he owed Roy

Cullen more than a million dollars. So perhaps it is not surprising that

McLendon's campaign functioned as an auxiliary to Bush's own efforts.

McLendon specialized in smearing Yarborough with the Billie Sol Estes

issue, and it was to this that McLendon devoted most of his speaking time

and media budget.

Billie Sol Estes in those days was notorious for his conviction for

defrauding the U.S. government of large sums of money in a scam involving

the storage of chemicals that turned out not to exist. Billie Sol was part

of the LBJ political milieu. As the Estes scandal developed, a report

emerged that he had given Yarborough a payment of $50,000 on Nov. 6, 1960.

But later, after a thorough investigation, the Department of Justice had

issued a statement declaring that the charges involving Yarborough were

"without any foundation in fact and unsupported by credible testimony."

"The case is closed," said the Justice Department. But this did not stop

Bush from using the issue to the hilt: "I don't intend to mud-sling with

[Yarborough] about such matters as the Billie Sol Estes case since

Yarborough's connections with Estes are a simple matter of record which any

one can check," said Bush. "[Yarborough is] going to have to prove to the

Texas voters that his connections with Billie Sol Estes were as casual as

he claims they were." / Note #1 / Note #6 In a release issued on April 24,

Bush "said he welcomes the assistance of Gordon McLendon, Yarborough's

primary opponent, in trying to force the incumbent Senator to answer." Bush

added that he planned to "hammer at Yarborough every step of the way ...

until I get some sort of answer."

The other accusation that was used against Yarborough during the campaign

was advanced most notably in an article published in the September 1964

issue of "Reader's Digest." The story was that Yarborough had facilitated

backing and subsidies through the Texas Area Reconstructio n Administration

for an industrial development project in Crockett, Texas, only to have the

project fail owing to the inability of the company involved to build the

factory that was planned. The accusation was that Audio Electronics, the

prospective factory builders, had received a state loan of $383,000 to

build the plant, while townspeople had raised some $60,000 to buy the plant

site, before the entire deal fell through.

The "Reader's Digest" told disapprovingly of Yarborough addressing a group

of 35 Crockett residents on a telephone squawk box in March, 1963, telling

them that he was authorized by the White House to announce "that you are

going to gain a fine new industry -- one that will provide new jobs for 180

people, add new strength to your area."

The "Reader's Digest" article left the distinct impression that the $60,000

invested by local residents had been lost. "Because people believed that

their Senator's 'White House announcment' of the ARA loan to Audio

guaranteed the firm's soundness, several Texans invested in it and lost

all. One man dropped $40,000. A retired Air Force officer plowed in $7000."

It turned out in reality that those who had invested in the real estate for

the plant site had lost nothing, but had rather been made an offer for

their land that represented a profit of one-third on the original

investment, and thus stood to gain substantially.

Bush campaign headquarters immediately got into the act with a statement

that "it is a shame" that Texans had to pick up the "Reader's Digest" and

find their Senator "holding the hand of scandal.... The citizens of the

area raised $60,000 in cash, invested it in the company, and lost it

because the project was a fraud and never started."

Yarborough shot back with a statement of his own, pointing out that Bush's

claims were "basely false," and adding that the "reckless, irresponsible,

false charges by my opponent further demonstrate his untruthfulness and

unfitness for the office of U.S. Senator." Most telling was Yarborough's

charge on how the "Reader's Digest" got interested in Crockett, Texas, in

the first place: "The fact that my opponent's multi-millionaire father's

Wall Street investment banking connections enable the planting of false and

libelous articles about me in a national magazine like the "Reader's

Digest" will not enable the Connecticut candidate to buy a Texas seat in

the U.S. Senate." (This was not mere rhetoric: "Reader's Digest General

Manager Albert Cole was Prescott Bush's neighbor and fellow member of the

Harrimans' secret enclave on Jupiter Island, Florida.) Yarborough's shot

was on target, it hurt. Bush whined in response that it was Yarborough's

statement which was "false, libelous, and hogwash," and challenged the

Senator to prove it or retract it. / Note #1 / Note #7

 

Racial Theme

Beyond these attempts to smear Yarborough, it is once again characteristic

that the principal issue around which Bush built his campaign was racism,

expressed this time as opposition to the civil rights bill that was before

the Congress during 1964. Bush did this certainly in order to conform to

his pro-Goldwater ideological profile, and in order to garner votes

(especially in the Republican primary) using racist and states' rights

backlash, but most of all in order to express the deepest tenets of the

philosophical world-outlook of himself and his oligarchical family.

Very early in the campaign, Bush issued a statement saying: "I am opposed

to the Civil Rights bill now before the Senate." Not content with that,

Bush proceeded immediately to tap the wellsprings of nullification and

interposition: "Texas has a comparably good record in civil rights," he

argued, "and I'm opposed to the Federal Government intervening further into

State affairs and individual rights." At this point Bush claimed that his

quarrel was not with the entire bill, but rather with two specific

provisions, which he claimed had not been a part of the original draft, but

which he hinted had been added to placate violent black extremists.

According to his statement of March 17, "Bush pointed out that the original

Kennedy Civil Rights bill in 1962 did not contain provisions either for a

public accommodations section or a Fair Employment Practices Commission

(FEPC) section." "Then, after the hot, turbulent summer of 1962, when it

became apparent that in order to get the Civil Rights leaders' support and

votes in the 1964 election something more must be done, these two bad

sections were added to the bill," according to Bush. "I suggest that these

two provisions of the bill -- which I most heatedly oppose -- were

politically motivated and are cynical in their approach to a most serious

problem."

But Bush soon abandoned this hair-splitting approach, and on March 25 he

told the Jaycees of Tyler, "I oppose the entire bill." Bush explained later

that beyond the public accommodations section and the Fair Employment

Practices Committee, he found that "the most dangerous portions of the bill

are those which make the Department of Justice the most powerful police

force in the Nation and the Attorney General the Nation's most powerful

police chief."

When Ted Kennedy of Massachusetts delivered his maiden speech to the Senate

in April of 1964, he included a passage referring to the late John F.

Kennedy, saying that the dead President had believed that "we should not

hate, but love one another." Bush lashed out at Kennedy for what he called

"unfair criticism of those who oppose the Civil Rights bill." In Bush's

interpretation, "Kennedy's dramatic, almost tearful plea for passage of the

bill presented all those who disagree with it as hate mongers." "The

inference is clear," Bush said. "In other words, Ted Kennedy was saying

that any one who opposes the present Civil Rights bill does so because

there is hate in his heart. Nothing could be further from the truth. This

is not a question of hate or love, but of Constitutionality." Bush "and

other responsible conservatives" simply think that the bill is politically

inspired. "This bill," Bush said, "would make further inroads into the

rights of individuals and the States, and even provide for the ultimate

destruction of our trial by jury system. We simply feel that this type of

class legislation, based on further federal control and intervention, is

bad for the nation." Bush said "the Civil Rights problem is basically a

local problem, best left to the States to handle." Here surely was a

respectable-sounding racism for the era of Selma and Bull Connor.

Bush was provided with new rhetorical ammunition when Alabama Governor

George Wallace ventured into the presidential primaries of that year and

demonstrated unexpected vote-getting power in certain northern states,

using a pitch that included overtly racist appeals. In the wake of one such

result in Wisconsin, the Bush campaign issued a release quoting the

candidate as being "sure that a majority of Americans are opposed to the

Civil Rights bill now being debated in the Senate." "Bush called attention

to the surprising 25 percent of the Wisconsin primary vote received by

Governor George C. Wallace of Alabama," said the release. In Bush's view,

"you can be sure this big vote was not cast for Wallace himself, but was

used as a means of showing public opposition to the Civil Rights Bill." "If

a flamboyant Governor Wallace can get that kind of a vote in a northern

state such as Wisconsin, it indicates to me that there must be general

concern from many responsible people over the Civil Rights bill all over

the nation," Bush said in Houston. "If I were a member of the Senate today,

I would vote against this bill in its entirety."

 

Footnotes - Chapter 10, Part 1

5. For a profile of Yarborough's voting record on this and other issues,

see Chandler Davidson, "Race and Class in Texas Politics" (Princeton:

Princeton University Press, 1990), pp. 29 ff.

6. For Yarborough's Senate achievements up to 1964, see Ronnie Dugger, "The

Substance of the Senate Contest," in "The Texas Observer," Sept. 18, 1964.

7. Bush and Gold, "op. cit.," p. 77 "ff."

8. See Harry Hurt III, "Texas Rich" (New York: Putnam, 1987), p. 191.

9. On Bush's drive t o become Harris County chairman, it is instructive to

compare his "Looking Forward" with the clippings from the "Houston

Chronicle" of those days, preserved on microfiche in the Texas Historical

Society in Houston. Bush says that he decided to run for the post in the

sping of 1962, but the Houston press clearly situates the campaign in the

spring of 1963. Bush also claims to have been county chairman for two

years, whereas the Houston papers show that he served from February 20,

1963 to around December 5 1963, less than one year.

10. Harry Hurt III, "George Bush, Plucky Lad," "Texas Monthly," June 1983,

p. 196....

12. For Anthony Farris in the Pennzoil vs. Texaco case, see below and also

Thomas Petzinger, Jr., "Oil and Honor" (New York: Putnam, 1987), "passim."

13. "Boston Globe," June 12, 1988, cited in Michael R. Beschloss, "The

Crisis Years" (New York: Edward Burlingame Books, 1991), p. 581.

14. See Barbara Bush, "C. Fred's Story" (New York: Doubleday, 1984), p. 2.

This is an example of Mrs. Bush's singular habit of composing books in

which she speaks through a canine persona, a feat she has repeated for the

current family pet and public relations ploy, Millie. In her account of how

C. Fred the dog got his name, George Bush is heard ruling out usual dog

names with the comment: "Not at all. We Bushes have always named our

children after people we loved." So, writes C. Fred, "I am named after

George Bush's best friend, C. Fred Chambers of Houston, Texas. I have met

him many times and he doesn't really seem to appreciate the great honor

that the Bushes bestowed upon him."

15. See Ronnie Dugger, "The Four Republicans," in "The Texas Observer,"

April 17, 1964.

16. Quotations from Bush and Yarborough campaign material, except as

otherwise indicated, are from Senator Yarborough's papers on deposit in the

Eugene C. Barker Texas History Center at the University of Texas in Austin.

17. See Ronnie Dugger, "The Substance of the Senate Contest," in "The Texas

Observer," Sept. 18, 1964.

 

CHAPTER 10

PART II

THE SENATE RACE

Bush was described in the Texas press as attempting a melange of

"Goldwater's policies, Kennedy's style." / Note #1 / Note #8 This coverage

reveals traits of the narcissistic macho in the 40-year old plutocrat: "He

is the sort of fellow the ladies turn their heads to see at the country

club charity ball." Abundant campaign financing allowed Bush "to attract

extra people to rallies with free barbecue, free drinks, and musical

entertainers." These were billed by the Bush campaign as a return to the

"old fashioned political rally," and featured such musical groups as the

Black Mountain Boys and the Bluebonnet Belles. At Garcia's Restaurant in

Austin, Bush encountered a group of two dozen or so sporty young Republican

women holding Bush campaign placards. "Oh girls!" crooned the candidate.

"Y'all look great! You look terrific. All dolled up." The women "were ga-ga

about him in return," wrote political reporter Ronnie Dugger in the "Texas

Observer," adding that Bush's "campaign to become this state's second

Republican senator gets a lot of energy and sparkle from the young

Republican matrons who are enthusiastic about him personally and have

plenty of money for baby sitters and nothing much to do with their time."

But in exhortations for militaristic adventurism abroad, the substance was

indeed pure Goldwater.

As could be expected from the man who had so recently challenged John F.

Kennedy to "muster the courage" to attack Cuba, some of Bush's most

vehement pronouncements concerned Castro and Havana, and were doubtless

much appreciated by the survivors of Brigade 2506 and the Miami Cubans.

Bush started off with what passed for a moderate position in Texas

Goldwater circles: "I advocate recognition of a Cuban government in exile

and would encourage this government every way to reclaim its country. This

means financial and military assistance." "I think we should not be found

wanting in courage to help them liberate their country," said Bush.

Candidate Morris had a similar position, but both Cox and Davis called for

an immediate restoration of the naval blockade of Cuba.

Bush therefore went them one up, and endorsed a new invasion of Cuba. A

Bush for Senate campaign brochure depicted a number of newspaper articles

about the candidate. The headline of one of these, from an unidentified

newspaper, reads as follows: ""Cuba Invasion Urged by GOP Candidate."" The

subtitle reads: "George Bush, Houston oilman, campaigning for the

Republican nomination to the U.S. Senate called for a new

government-in-exile invasion of Cuba, no negotiation of the Panama Canal

treaty, and a freedom package in Austin." Other campaign flyers state that

"Cuba ... under Castro is a menace to our national security. I advocate

recognition of a Cuban government in exile and support of this government

to reclaim its country. We must reaffirm the Monroe Doctrine." Another

campaign handout characterizes Cuba as "an unredeemed diplomatic disaster

abetted by a lack of a firm Cuban policy."

What Bush was proposing would have amounted to a vast and well-funded

program for arming and financing anti-Castro Cuban exiles in Miami, and

putting the United States government at the service of their adventures --

presumably far in excess of the substantial programs that were already

being funded. Beneficiaries would have included Theodore Shackley, who was

by now the station chief at CIA Miami station, Felix Rodriguez, Chi Chi

Quintero, and the rest of the boys from the Enterprise.

Bush attacked Senator J. William Fulbright, Democrat of Arkansas, for the

latter's call in a speech for a more conciliatory policy toward Cuba,

ending the U.S. economic boycott. "I view the speech with great suspicion,"

said Bush. "I feel this is a trial balloon on the part of the State

Department to see whether the American people will buy another step in a

disastrous, soft foreign policy." Bush called on Secretary of State Dean

Rusk, a leading hawk, to hold firm against the policy shift that Fulbright

was proposing. "Fulbright says Cuba is a 'distasteful nuisance', but I

believe that Castro's Communist regime 90 miles from our shores is an

intolerable nuisance. I am in favor only of total liberation of Cuba,"

proclaimed Bush, "and I believe this can only be achieved by recognition of

a Cuban government in exile, backed up to the fullest by the United States

and the Organization of American States."

In the middle of April, a Republican policy forum held in Miami heard a

report from a Cuban exile leader that the Soviets had positioned missiles

on the ocean floor off Cuba, with the missiles pointed at the United

States, and that this had been confirmed by diplomatic sources in Havana.

This would appear in retrospect to have been a planted story. For Bush it

was obvious grist for his campaign mill. Bush, speaking in Amarillo, called

the report "the most alarming news in this hemisphere in two years." He

called for efforts to "drive the Communists out of Cuba."

But, in keeping with the times, Bush's most genocidal campaign statements

were made in regard to Vietnam. Here Bush managed to identify himself with

the war, with its escalation, and with the use of nuclear weapons.

Senator Goldwater had recently raised the possibility of using tactical

nuclear weapons as the most effective defoliants to strip away the triple

canopy jungle of Vietnam. In a response to this, an Associated Press story

quoted Bush as saying that he was in favor of anything that could be done

safely toward finishing the fighting in Southeast Asia. "Bush said he

favors a limited extension of the war in Viet Nam, including restricted use

of nuclear weapons if 'militarily prudent,'|" according to the AP release.

/ Note #1 / Note #9 A Bush campaign release of June 1 has him saying he

favors a "cautious, judicious, and militarily sound extension of the war in

Vietnam." This was all before the Gulf of Tonkin incident and well before

U.S. ground troops were committed to Vietnam.

Bush had several other notes to sound concerning the looming war in

Southeast Asia. In May, he attacked the State Department for "dawdling" in

Vietnam, a policy which he said had "cost the lives of so many young

Americans." He further charged that the U.S. troops in Vietnam were being

issued "shoddy war material." Responding to a prediction from Defense

Secretary McNamara that the war might last ten years, Bush retorted: "This

would not be the case if we had developed a winning policy from the start

of this dangerous brush fire." Also in May, Bush responded to a Pathet Lao

offensive in Laos as follows: "This should be a warning to us in Vietnam.

Whenever the Communist world -- either Russian or Chinese -- sign a treaty,

or any other agreement, with a nation of the free world, that treaty isn't

worth the paper it's written on."

Bush pugnaciously took issue with those who wanted to disengage from the

Vietnam quagmire before the bulk of the war's human losses had occurred. He

made this part of his "Freedom Package," which was a kindof manifesto for

a worldwide U.S. imperialist and colonialist offensive -- a precursor of

the new world order "ante litteram." A March 30 campaign release proclaims

the "Freedom Package" in these terms: "|'I do not want to continue to live

in a world where there is no hope for a real and lasting peace,' Bush said.

He decried 'withdrawal symptoms' propounded by U.N. Ambassador Adlai

Stevenson and Senators William Fulbright and Mike Mansfield. 'Adlai has

proposed we [inter]nationalize the Panama Canal,' Bush pointed out,

'Fulbright asks us to accommodate Red Cuba and renegotiate our Panama

treaty, and Mansfield suggests we withdraw from the Viet Nam struggle. This

is the kind of retreatism we have grown accustomed to among our supposed

world leaders and it is just what the Kremlin ordered.'|"

Nor did Bush's obsession with Panama and the Panama Canal begin with

Noriega. In his campaign literature, Bush printed his basic position that

the "Panama Canal ... is ours by right of treaty and historical

circumstance. The Canal is critical to our domestic security and U.S.

sovereignty over the Canal must be maintained." What is meant by the right

of historical circumstance? "I am opposed to further negotiation in

Panama," Bush stated repeatedly in his campaign speeches and releases....

Unbridled Free Enterprise

In economic policy, Bush's starting point was always "unbridled free

enterprise," as he stressed in a statement on unemployment on March 16:

"Only unbridled free enterprise can cure unemployment. But, I don't believe

the federal government has given the private sector of our economy a

genuine opportunity to relieve this unemployment. For example, the [Johnson

war on poverty program] contains a new version of the CCC, a Domestic Peace

Corps, and various and sundry half-baked pies in the sky." Bush's printed

campaign literature stated, under the heading of "federal economy," that

"the free enterprise system must be unfettered. A strong economy means

jobs, opportunity, and prosperity. A controlled economy means loss of

freedom and bureaucratic bungling." On April 21, Bush told the voters: "We

must begin a phase of re-emphasizing the private sector of our economy,

instead of the public sector."

By April 15, Bush had been informed that there were some 33 million

Americans living in poverty, to which he replied: "I cannot see how draping

a socialistic medi-care program around the sagging neck of our social

security program will be a blow to poverty. And I can see only one answer

to [the problem of poverty]: Let us turn our free enterprise system loose

from government control." Otherwise, Bush held it "the responsibility of

the local government first to assume the burden of relieving poverty

wherever its exists, and I know of many communities that are more than

capable of working with this problem."

Bush's approach to farm policy was along similar lines, combining the

rhetoric of Adam Smith with intransigent defense of the food cartels. In

his campaign brochure he opined that "Agriculture ... must be restored to a

free market economy, subject to the basic laws of supply and demand." On

April 9 in Waco, Bush assailed the Wheat-Cotton subsidy bill which had just

received the approval of the House. "If I am elected to the Senate," said

Bush, I will judge each agricultural measure on the basis of whether it

gets the Government further into, or out of, private business." Bush added

that farm subsidies are among "our most expensive federal programs."

Another of Bush's recurrent obsessions was his desire to break the labor

movement. During the 1960s, he expressed this in the context of campaigns

to prevent the repeal of section 14 (b) of the Taft-Hartley law, which

permitted the states to outlaw the closed shop and union shop, and thus to

protect state laws guaranteeing the so-called open shop or "right to work,"

a device which in practice prevented the organization of large sectors of

the working population of these states into unions. Bush's editorializing

takes him back to the era when the Sherman Antitrust Act was still being use

d against labor unions.

"I believe in the right-to-work laws," said Bush to a group of prominent

Austin businessmen at a luncheon in the Commodore Perry Hotel on March 5.

"At every opportunity, I urge union members to resist payment of political

assessments. If there's only one in 100 who thinks for himself and votes

for himself, then he should not be assessed by COPE."

On March 19, Bush asserted that "labor's blatant attack on right-to-work

laws is open admission that labor does have a monopoly and will take any

step to make this monopoly. Union demands are a direct cause of the

inflationary spiral lowering the real income of workers and increasing the

costs of production." This is, from the point of scientific economics, an

absurdity. But four days later Bush returned to the topic, attacking United

Auto Workers President Walter Reuther, a figure whom Bush repeatedly sought

to identify with Yarborough, for demands which "will only cause the

extinction of free enterprise in America. A perfect example of labor's

pricing a product out of existence is found in West Virginia. John L.

Lewis's excessive demands on the coal industry raised the price of coal,

forced the consumer to use a substitute cheaper product, killed the coal

industry and now West Virginia has an excessive rate of unemployment."

On Labor Day, Bush spoke to a rally in the courthouse square of Quanah, and

called for "protection of the rights of the individual laborer through the

state rather than the federal government. The individual laboring man is

being forgotten by the Walter Reuthers and Ralph Yarboroughs, and it's up

to the business community to protect our country's valuable labor resources

from exploitation by these left-wing labor leaders," said Bush, who might

just as well have suggested that the fox be allowed to guard the chicken

coop.

East Texas was an area of unusually high racial tension, and Bush spent

most of his time there attacking the civil rights bill. But the alliance

between Yarborough and big labor was one of his favorite themes. The

standard pitch went something like this, as before the Austin businessmen.

Yarborough, he would start off saying, "more nearly represents the state of

Michigan than he does Texas." This, as we will see, was partly an

attempted, lame rebuttal of Yarborough's charge that Bush was a

northeastern carpetbagger. Bush would then continue: "One of the main

reasons Yarborough represents Texas so badly is that he's spending most of

his time representing labor interests in Detroit. His voting record makes

men like Walter Reuther and James Hoffa very happy. This man has voted for

every special interest bill, for every big spending measure that's come to

his attention."

During this period Camco, an oilfield equipment company of which Bush was a

director, was embroiled in some bitter labor disputes. The regional office

of the National Labor Relations Board sought a federal injunction against

Camco in order to force the firm to re-hire four union organizers who had

been illegally fired. Officials of the Machinists Union, which was trying

to organize Camco, also accused Bush of being complicit in what they said

was Camco's illegal failure to carry out a 1962 NLRB order directing Camco

to re-hire 11 workers, fired because they had attended a union meeting.

Bush answered that he was not going to be intimidated by labor. "As

everybody knows, the union bosses are all-out for Sen. Ralph Yarborough,"

countered Bush, and he had been too busy with Zapata to pay attention to

Camco anyway. / Note #2 / Note #0 According to Roy Evans, the

secretary-treasurer of the Texas AFL-CIO, Bush was "a member of the

dinosaur wing of the Republican Party." Evans called Bush "the Houston

throwback," and maintained that Bush had "lost touch with anyone in Texas

except the radicals of the right."

Back in February, Yarborough had remarked in his typical populist vein that

his legislative approach was to "put the jam on the lower shelf so the

little man can get his hand in." This scandalized Bush, who countered on

February 27 that "it's a cynical attitude and one that tends to set the

so-called little man apart from the rest of his countrymen." For Bush, the

jam would always remain under lock and key, except for the chosen few of

Wall Street. A few days later, on March 5, Bush elaborated that he was

"opposed to special interest legislation because it tends to hyphenate

Americans. I don't think we can afford to have veteran-Americans,

Negro-Americans, Latin-Americans and labor-Americans these days." Here is

Bush as political philosopher, maintaining that the power of the

authoritarian state must confront its citizens in a wholly atomized form,

not organized into interest groups capable of defending themselves.

Bush was especially irate about Yarborough's Cold War G.I. Bill, which he

branded the Senator's "pet project." "Fortunately," said Bush, "he has been

unable to cram his Cold War G.I. Bill down Congress' throat. It's bad

legislation and special interest legislation which will erode our American

way of life. I have four sons, and I'd sure hate to think that any of them

would measure their devotion and service to their country by what special

benefits Uncle Sam could give them." Neil Bush would certainly never do

that! Anyway, the Cold War G.I. Bill was nothing but a "cynical effort to

get votes," Bush concluded.

 

The Oil Cartel's Candidate

There was a soft spot in Bush's heart for at least a few special interests,

however. He was a devoted supporter of the "time-proven" 27.5 percent oil

depletion allowance, a tax write-off which allowed the seven sisters oil

cartel to escape a significant portion of what they otherwise would have

paid in taxes. Public pressure to reduce this allowance was increasing, and

the oil cartel was preparing to concede a minor adjustment, in the hope

that this would neutralize attempts to get the depletion allowance

abolished entirely. Bush also called for what he described as a "meaningful

oil import program, one which would restrict imports at a level that will

not be harmful to our domestic oil industry." "I know what it is to earn a

paycheck in the oil business," he boasted. Bush also told Texas farmers

that he wanted to limit the imports of foreign beef so as to protect their

domestic markets.

Yarborough's counterattack on this issue is of great relevance to

understanding why Bush was so fanatically committed to wage war in the Gulf

to restore the degenerate, slaveholding Emir of Kuwait. Yarborough pointed

out that Bush's company, Zapata Offshore, was drilling for oil in Kuwait,

the Persian Gulf, Borneo, and Trinidad. "Every producing oil well drilled

in foreign countries by American companies means more cheap foreign oil in

American ports, fewer acres of Texas land under oil and gas lease, less

income to Texas farmers and ranchers," Yarborough stated. "This issue is

clear-cut in this campaign -- a Democratic senator who is fighting for the

life of the free enterprise system as exemplified by the independent oil

and gas producers in Texas, and a Republican candidate who is the

contractual driller for the international oil cartel."

In those days, the oil cartel did not deal mildly with those who attacked

it in public. One thinks again of the Italian oilman Enrico Mattei. For

Bush, these cartel interests would always be sacrosanct. On April 1, Bush

talked of the geopolitics of oil: "I was in London at the time of the Suez

crisis and I quickly saw how the rest of the free world can become

completely dependent on American oil. When the Canal was shut down, free

nations all over the world immediately started crying for Texas oil."

Later in the campaign, Yarborough visited the town of Gladewater in East

Texas. There, standing in view of the oil derricks, Yarborough talked about

Bush's ownership of Pennzoil stock, and about Pennzoil's quota of 1,690

barrels per day of imported oil, charging that Bush was undermining the

Texas producers by importing cheap foreign oil.

Then, according to a newspaper account, "the senator spiced his charge with

a reference to the 'Sheik of Kuwait and his four wives and 100 concubines,'

who, he said, are living in luxury off the oil from Bush-drilled wells in

the Persian Gulf and sold at cut-rate prices in the United States. He said

that imported oil sells for $1.25 a barrel while Texas oil, selling at $3,

pays school, city, county, and federal taxes and keeps payrolls going.

Yarborough began his day of campaigning at a breakfast with supporters in

Longview. Later, in Gladewater, he said he had seen a 'Bush for Senator'

bumper sticker on a car in Longview. 'Isn't that a come-down for an East

Texan to be a strap-hanger for a carpetbagger from Connecticut who is

drilling oil for the Sheik of Kuwait to help keep that harem going?'|" /

Note #2 / Note #1

Yarborough challenged Bush repeatedly to release more details about his

overseas drilling and producing interests. He spoke of Bush's "S.A.

corporations drilling in the Persian Gulf in Asia." He charged that Bush

had "gone to Latin America to incorporate two of his companies to drill in

the Far East, instead of incorporating them in the United States." That in

turn, thought Yarborough, "raises questions of tax avoidance." "Tell them,

George," he jeered, "what your 'S.A.' companies, financed with American

dollars, American capital, American resources, are doing about American

income taxes." Bush protested that "every single tax dollar due by any

company that I own an interest in has been paid." / Note #2 / Note #2

 

Forced into a Runoff

As the Republican senatorial primary approached, Bush declared that he was

confident that he could win an absolute majority and avoid a runoff. On

April 30, he predicted that Hill Rise would win the Kentucky Derby without

a runoff, and that he would also carry the day on the first round. There

was no runoff in the Kentucky Derby, but Bush fell short of his goal. Bush

did come in first with about 44 percent of the vote or 62,579 votes, while

Jack Cox was second with 44,079, with Morris third and Davis fourth. The

total number of votes cast was 142,961, so a second round was required.

Cox, who had attracted 710,000 votes in his 1962 race against Connally for

the governorship, was at this point far better known around the state than

Bush. Cox had the backing of Gen. Edwin Walker, who had made a bid for the

Democratic gubernatorial nomination in 1962 himself and gotten some 138,000

votes. Cox also had the backing of H.L. Hunt.

Morris had carried Dallas County, and he urged his supporters to vote

against Bush. Morris told the "Dallas Morning News" of May 5 that Bush was

"too liberal" and that Bush's strength in the primary was due to "liberal"

Republican support.

Between early May and the runoff election of June 6, Cox mounted a vigorous

campaign of denunciation and exposure of Bush as a creature of the Eastern

Liberal Establishment, Wall Street banking interests, and of Goldwater's

principal antagonist for the GOP presidential nomination, the hated Gov.

Nelson Rockefeller of New York. According to a story filed by Stuart Long

of the Long News Service in Austin on May 25, and preserved among the

Yarborough papers in the Barker Texas History Center in Austin, Cox's

supporters circulated letters pointing to Prescott Bush's role as a partner

in Brown Brothers Harriman as the basis for the charge that George Bush was

the tool of "Liberal Eastern Kingmakers." According to Long, the letters

also include references to the New York Council on Foreign Relations, which

he described as a "black-tie dinner group." / Note #2 / Note #3 The pro-Cox

letters also asserted that Bush's Zapata Offshore Company had a history of

bidding on drilling contracts for Rockefeller's Standard Oil of New Jersey.

One anti-Bush brochure, preserved among the Yarborough papers at the Barker

Center in Austin, is entitled "Who's Behind the Bush?" published by the

Coalition of Conservatives to Beat the Bushes, with one Harold Deyo of

Dallas listed as chairman. The attack on Bush here centers on the Council

on Foreign Relations, of which Bush was not at that time a public member.

The brochure lists a number of Bush campaign contributors and then

identifies these as members of the CFR. These include Dillon Anderson and

J.C. Hutcheson III of Baker and Botts, Andrews and Shepherd; Leland

Anderson of Anderson, Clayton and Company; Lawrence S. Reed of Texas Gulf

Producing; Frank Michaux; and W.A. Kirkland of the board of First City

National Bank. The brochure then focuses on Prescott Bush, identified as a

"partner with Averell Harriman in Brown Brothers, Harriman, and Company."

Averell Harriman is listed as a member of the Council on Foreign Relations.

"Could it be that Prescott S. Bush, in concert with his Eastern CFR

friends, is raising all those 'Yankee Dollars' that are flowing into

George's campaign? It is reliably reported that Mr. George Bush has

contracted for extensive and expensive television time for the last week of

the Runoff." The brochure also targets Paul Kayser of Anderson, Clayton,

Bush's Harris County campaign chairman. Five officers of this company,

named as W.L. Clayton, L. Fleming, Maurice McAshan, Leland Anderson and

Sydnor Oden, are said to be members of the CFR.

On the CFR itself, the brochure quotes from Helen P. Lasell's study,

entitled "Power Behind Government Today," which found that the CFR "from

its inception has had an important part in planning the whole diabolical

scheme of creating a ONE WORLD FEDERATION of socialist states under the

United Nations.... These carefully worked out, detailed plans, in

connection with the WORLD BANK and the use of billions of tax-exempt

foundation dollars, were carried out secretively over a period of years.

Their fruition could mean not only the absolute destruction of our form of

government, national independence and sovereignty, but to a degree at

least, that of every nation in the world." The New World Order, we see, is

really nothing new. The brochure further accuses one Mrs. M. S. Acherman, a

leading Bush supporter in Houston, of having promoted a write-in campaign

for liberal, Boston Brahmin former Senator Henry Cabot Lodge of

Massachusetts in the Texas presidential primary. Lodge had won the 1964 New

Hampshire primary, prompting Bush to announce that this was merely a

regional phenomenon and that he was "still for Goldwater."

As the runoff vote approached, Cox focused especially on the eastern

financing that Bush was receiving. On May 25 in Abilene, Cox assailed Bush

for having mounted "one of the greatest spending sprees ever seen in any

political campaign." Cox said that he could not hope to match this funding,

"because Jack Cox is not, nor will ever be, connected in any manner with

the Eastern kingmakers who seek to control political candidates.

Conservatives of Texas will serve notice on June 6 that just as surely as

Rockefeller's millions can't buy presidential nomination, the millions at

George Bush's disposal can't buy him a senate nomination." Cox claimed that

all of his contributions had come from inside Texas.

O'Donnell's Texas Republican organization was overwhelmingly mobilized in

favor of Bush. Bush had the endorsement of the state's leading newspapers.

When the runoff finally came, Bush was the winner with some 62 percent of

the votes cast. Yarborough commented that Bush "smothered Jack Cox in

greenbacks."

Gordon McLendon, true to form, had used his own pre-primary television

broadcast to rehash the Billie Sol Estes charges against Yarborough.

Yarborough nevertheless defeated McLendon in the Democratic senatorial

primary with almost 57 percent of the vote. Given the lopsided Texas

Democratic advantage in registered voters, and given LBJ's imposing lead

over Goldwater at the top of the Democratic ticket, it might have appeared

that Yarborough's victory was now a foregone conclusion. That this was not

so was due to the internal divisions within the Texas Democratic ranks.

 

Senate Seat Can't Be Bought

First were the Democrats who came out openly for Bush. The vehicle for this

defection was called Conservative Democrats for Bush, chaired by Ed Drake,

the former leader of the state's Democrats for Eisenhower in 1952. Drake

was joined by former Governor Allan Shivers, who had also backed Ike and

Dick in 1952 and 1956. Then there was the "East Texas Democrats for George

Bush Committee," chaired by E.B. Germany, the former state Democratic

leader, a leader of Scottish Rite Freemasons in Texas and in 1964 the

chairman of the board of Lone Star Steel.

Then there were various forms of covert support for Bush. Millionaire

Houston oil man Lloyd Bentsen, who had been in Congress back in the late

1940s, had been in discussion as a possible Senate candidate. Bush's basic

contention was that LBJ had interfered in Texas politics to tell Bentsen to

stay out of the Senate race, thus avoiding a more formidable primary

challenge to Yarborough. On April 24, Bush stated that Bentsen was a "good

conservative" who had been kept out of the race by "Yarborough's bleeding

heart act." This and other indications point to a covert political entente

between Bush and Bentsen, which reappeared during the 1988 presidential

campaign.

Then there were the forces associated with Governor "Big John" Connally.

Yarborough later confided that Connally had done everything in his power to

wreck his campaign, subject only to certain restraints imposed by LBJ. Even

these limitations did not amount to real support for Yarborough on the part

of LBJ, but were rather attributable to LBJ's desire to avoid the

embarrassment of seeing his native state represented by two Republican

senators during his own tenure in the White House. But Connally still

sabotaged Yarborough as much as LBJ would let him get away with. / Note #2

/ Note #4

Bush and Connally have had a complex political relationship, with points of

convergence and many points of divergence. Back in 1956, a lobbyist working

for Texas oilman Sid Richardson had threatened to "run [Bush's] ass out of

the offshore drilling business" unless Prescott Bush voted for gas

deregulation in the Senate. / Note #2 / Note #5 Connally later became the

trustee for some of Richardson's interests. While visiting Dallas on March

19, Bush issued a statement saying that he agreed with Connally in his

criticisms of attorney Melvin Belli, who had condemned the District Court

in Dallas when his client, Jack Ruby, was given the death sentence for

having slain Lee Harvey Oswald the previous November.

In public, LBJ was for Yarborough, although he could not wholly pass over

the frictions between the two. Speaking at Stonewall after the Democratic

national convention, LBJ had commented: "You have heard and you have read

that Sen. Yarborough and I have had differences at times. I have read a

good deal more about them than I was ever aware of. But I do want to say

this, that I don't think that Texas has had a senator during my lifetime

whose record I am more familiar with than Sen. Yarborough's. And I don't

think Texas has had a senator that voted for the people more than Sen.

Yarborough has voted for them. And no member of the U.S. Senate has stood

up and fought for me or fought for the people more since I became President

than Ralph Yarborough." For his part, Bush, years later, quoted a "Time"

magazine analysis of the 1964 senate race which concluded that "if Lyndon

would stay out of it, Republican Bush would have a cha nce. But Johnson is

not about to stay out of it, which makes Bush the underdog." / Note #2 /

Note #6

Yarborough, for his part, had referred to LBJ as a "power-mad Texas

politician," and had called on President Kennedy to keep LBJ out of Texas

politics. Yarborough's attacks on Connally were even more explicit and

colorful: He accused Connally of acting like a "viceroy, and we got rid of

those in Texas when Mexico took over from Spain." According to Yarborough,

"Texas had not had a progressive governor since Jimmy Allred," who had held

office from 1935 to 1939. Bush took pains to spell out that this was an

attack on Democrats W. Lee O'Daniel, Coke Stevenson, Buford H. Jester,

Allan Shivers, Price Daniel, and John Connally.

Yarborough also criticized the right-wing oligarchs of the Dallas area for

having transformed that city from a democratic town to a "citadel of

reaction." For Yarborough, the "Fort Worth Star-Telegram" was"worse than

Pravda."

Yarborough's strategy in the November election centered on identifying Bush

with Goldwater in the minds of voters, since the Arizona Republican's

warlike rhetoric was now dragging him down to certain defeat. Yarborough's

first instinct had been to run a substantive campaign, stressing issues and

his own legislative accomplishments. Yarborough in 1988 told Bush

biographer Fitzhugh Green: "When I started my campaign for re-election I

was touting my record of six years in the Senate. But my speech advisers

said, all you have to do is quote Bush, who had already called himself 100

per cent for Goldwater and the Vietnam war. So that's what I did, and it

worked very well." / Note #2 / Note #7

Campaigning in Port Arthur on October 30, a part of the state where his

labor support loomed large, Yarborough repeatedly attacked Bush as "more

extreme than Barry Goldwater." According to Yarborough, even after Barry

Goldwater had repudiated the support of the John Birch Society, Bush said

that he "welcomed support of the Birch Society and embraced it." "Let's you

elect a senator from Texas, and not the Connecticut investment bankers with

their $2,500,000," Yarborough urged the voters. / Note #2 / Note #8

These attacks were highly effective, and Bush's response was to mobilize

his media budget for more screenings of his World War II "Flight of the

Avenger" television spot, while he prepared a last-minute television dirty

trick. There was to be no debate between Bush and Yarborough, but this did

not prevent Bush from staging a televised "empty chair" debate, which was

aired on more than a dozen stations around the state on October 27. The

Bush campaign staff scripted a debate in which Bush answered doctored

quotes from audio tapes of Yarborough speaking, with the sentences often

cut in half, taken out of context, and otherwise distorted. Yarborough

responded by saying: "The sneaky trick my opponent is trying to pull on me

tonight of pulling sentences of mine out of context with my recorded voice

and playing my voice as a part of his broadcast is illegal under the law,

and a discredit to anyone who aspires to be a U.S. Senator. I intend to

protest this illegal trick to the Federal Communications Commission."

Bush's method was to "cut my statements in half, then let his Madison

Avenue speech writers answer those single sentences.... My opponent is an

exponent of extremism, peddling smear and fear wherever he goes.... His

conduct looks more like John Birch Society conduct than United States

Senate conduct," Yarborough added. Bush also distorted the sound of

Yarborough's voice almost beyond recognition.

Yarborough protested to the FCC in Washington, alleging that Bush had

violated section 315 of the Federal Communications Act as it then stood,

because Yarborough's remarks were pre-censored and used without his

permission. Yarborough also accused Bush of violation of section 325 of the

same act, since it appeared that parts of the "empty chair" broadcast were

material that had been previously broadcast elsewhere, and which could not

be re-used without permission. The FCC responded by saying that the tapes

used had been made in halls where Yarborough was speaking.

All during the campaign, Yarborough had been talking about the dangers of

electronic eavesdropping. He had pointed out that "anybody can be an

eavesdropper, a wiretapper, a bugger, who has a few dollars for the cheaper

devices on the market. Tiny recorders and microphones are now made to

resemble lapel buttons or tie clasps.... Recorders can also be found the

size of a book or a cigarette pack. There is a briefcase available with a

microphone built into the lock, and many available recorders may be carried

in briefcases, while the wrist-watch microphone is no longer a product used

by Dick Tracy -- it can actually be bought for $37.50." Yarborough charged

during the primary campaign period that his Washington office had been

wiretapped, and years later indicated that the CIA had been bugging all of

Capitol Hill during those years. / Note #2 / Note #9 Had the James McCords

or other plumbers been lending Bush a hand?

Bush was also smarting under Yarborough's repeated references to his New

England birth and background. Bush claimed that he was no carpetbagger, but

a Texan by choice, and compared himself in that regard to Sam Rayburn, Sam

Houston, Stephen Austin, Colonel Bill Travis, Davy Crockett, Jim Bowie and

other heroes of the Alamo. Bush was not hobbled by any false modesty. At

least, Bush asserted lamely, he was not as big a carpetbagger as Bobby

Kennedy, who could not even vote in New York State, where he was making a

successful bid for election to the Senate. It "depends on whose bag is

being carpeted," Bush whined.

In the last days of the campaign, Allan Duckworth of the pro-Bush "Dallas

Morning News" was trying to convince his readers that the race was heading

for a "photo finish." But in the end, Prescott's networks, the millions of

dollars, the recordings, and the endorsements of 36 newspapers were of no

avail for Bush. Yarborough defeated Bush by a margin of 1,463,958 to

1,134,337. Within the context of the LBJ landslide victory over Goldwater,

Bush had done somewhat better than his party's standard bearer: LBJ beat

Goldwater in Texas by 1,663,185 to 958,566. Yarborough, thanks in part to

his vote in favor of the Civil Rights Act, won a strong majority of the

black districts, and also ran well ahead among Latinos. Bush won the usual

Republican counties, including the pockets of GOP support in the Houston

area.

Yarborough would continue for one more term in the Senate, vocally opposing

the war in Vietnam. In the closing days of the campaign he had spoken of

Bush and his retinue as harbingers of a "time and society when nobody

speaks for the working man." George Bush, defeated though he was, would now

redouble his struggle to make such a world a reality.

 

Footnotes - Chapter 10, Part 2

18. See "The Historic Texas Senate Race," in "The Texas Observer," Oct. 30,

1964.

19. Cited in Ronnie Dugger, "op. cit."

20. "Ibid."

21. "Dallas News," Oct. 24, 1964.

22. "Dallas News," Oct. 3, 1964.

23. An untitled report among the Yarborough papers in the Barker Texas

History Center refers to "Senator Bush's affiliation in a New York

knife-and-fork-club type of organization called, 'The Council on Foreign

Relations.' In a general smear -- mainly via the 'I happen to know' letter

chain of communication -- the elder Bush was frequently attacked, and the

younger Bushes were greatly relieved when Barry Goldwater volunteered words

of affectionate praise for his former colleague during a $100-a-plate

Dallas dinner."

24. Just how far these efforts might have gone is a matter of speculation.

Douglas Caddy in his book, "The Hundred Million Dollar Payoff" (New

Rochelle), p. 300, reprints an internal memorandum of the Machinists

Non-Partisan Political League which expresses alarm about the election

outlook for Yarborough, who is described as "the last stand-up Democratic

liberal we have in the South." The memo, from Jack O'Brien to A.J. Hayes,

is dated October 27, 1964, and cites reports from various labor operatives

to the effect that "the 'fix is in' to defeat Ralph Yarbor ough and to

replace him with a Republican, Bush, the son of Prescott Bush of

Connecticut. The only question at issue is whether this 'fix' is a product

of Governor Connally alone or is the product of a joint effort between

Connally and President Johnson." According to the memo, "Walter Reuther

called Lyndon Johnson to express his concern with the failure to invite

Mrs. Yarborough to accompany" LBJ's plane through Texas. Labor leaders were

trying to help raise money for last-minute television broadcasts by

Yarborough, and also to extract more vocal support for the senator from

LBJ.

25. See Bush and Gold, "op. cit.," p. 82.

26. "Ibid.," p. 87.

27. Fitzhugh Green, "George Bush: An Intimate Portrait" (New York:

Hippocrene Books, 1989), p. 85.

28. "Dallas News," Oct. 31, 1964.

29. Ronnie Dugger, "Goldwater's Policies, Kennedy's Style" in "Texas

Observer," Oct. 30, 1964.

 

 

 

 

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Jan. 4, 1997.