The Existing Order
© Oct. 16, 2009 by LINDA MINOR
“That an Anglo-American alliance is well calculated to support the existing order throughout the world, even at the expense of democracy against Fascism, should … give pause to anyone who calculates that Montagu Norman + J. P. Morgan = democracy.” (1)
Plot and counterplot
- That the wealthy class would either be forced to pay higher taxes to support Roosevelt’s welfare programs; or
- That Roosevelt would change the government’s economic system completely from capitalism to socialism.
"This
is to sustain him when others assault him…. You know, the President is
weak. He will come right along with us. He was born in this class. He
was raised in this class, and he will come back. He will run true to
form. In the end he will come around. But we have got to be prepared to
sustain him when he does."(2)
Further questioning by General Butler, who played along with the game, elicited from MacGuire the following dialogue:
“We might have an assistant President, somebody to take the blame; and if things do not work out, he can drop him…. That is what he was building up Hugh Johnson (FDR's National Recovery Administration czar) for. Hugh Johnson talked too damn much and got him into a hole, and he is going to fire him in the next three or four weeks.”
[Butler] said, “How do you know all this?”“Oh,” he said, “we are in with him all the time. We know what is going to happen.” (3)
Butler
realized very quickly that the schemers were privy to highly
confidential inside information from the centers of power. Everything
they predicted shortly came to pass. However, if General Johnson was a
disappointment to those who selected him, their choice of General Butler
was about to become a disaster.
Identifying the true racketeers
General
Butler was loved and admired by the soldiers he led. He identified with
them, and he freely placed the blame for the wars in which he had
served throughout his career on the class he felt was responsible for
those wars—the bankers and businessmen whose fat he, as a career
soldier, had often pulled from the fire.
Who were these plotters? Jules Archer in his 1973 book called The Plot to Seize the White House (5) did not speculate about the men who pulled the strings behind the scenes, though he accurately described the scenario that played out on the public stage.
Making the World Safe for Investment
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| Click to enlarge. |
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| Davis' boss, Jack Morgan, Jr. |
MacGuire,
who was on the payroll of Murphy's brokerage office, G. M-P Murphy
& Co., had not only offered eighteen $1,000 bills to Butler (which
were rejected), but had also promised to present the General as keynote
speaker at an upcoming American Legion convention in Chicago, where a
speech written by John W. Davis about the need to return to the gold
standard would be made available for him to read. MacGuire boasted that
his boss, Murphy, had donated $125,000 to found the veterans’ group,
ostensibly designed along a similar pattern observed in Europe (notably
in Mussolini's Italy), which, he bragged, was completely within their
control.
Grayson M.-P. Murphy and the
Bankers’ intelligence network
What
we can glean from the remainder of his career—including his role in the
1934 plot—reveals much about America’s incipient intelligence
organization before either the Office of Strategic Services or Central
Intelligence Agency were formed.
G.M-P
Murphy & Co., formed in 1907, specialized in the preserving assets
of bankrupt companies for the benefit of creditors, working on
commissions paid to him by creditors desiring to get possession of
assets held as security for defaulted loans. Gerald MacGuire, at the
time he approached Gen. Butler, sold bonds for the Murphy company, and
it is clear from testimony given before the Congressional Committee on
Un-American Activities that MacGuire was
“continuously on the payroll of G.M.P. Murphy & Co., regardless as to whether he was making tours of inspection at the expense of Clark or whatever he was doing.” (10)
Ostensibly, MacGuire’s numerous travel expenses were paid by an organization called the Committee for a Sound Dollar and Sound Currency, Inc.
(whose members, MacGuire claimed, included both Grayson Murphy and
Robert Sterling Clark. Clark undoubtedly had access to a huge pool of
cash set aside to promote the the American Legion's Chicago convention,
for which he tried unsuccessfully to recruit General Butler as a speaker. (11)
The American Legion’s purposes apparently coincided with those of
MacGuire’s employer, Grayson Murphy, whose company’s $125,000 donation
had financed the Legion’s incorporation.
Unless Murphy’s company was a mere cover for intelligence work,
it is difficult to understand what MacGuire contributed to the company
which paid him to travel throughout Europe, studying the role military
groups had played in setting up Fascist governments in Spain, Italy and
Vischy France. Murphy’s background, besides heading "protective
committees" to foreclose on creditors’ interests in collateral on
existing loans, was military intelligence and planning of secret
military operations--forerunner to the role of today's CIA.
He was part of a super-secret intelligence organization within the
military, funded by the American Red Cross and coordinated by Major General Ralph H. Van Deman—General
Pershing's senior intelligence officer and Chief of Allied
Counterintelligence.
Beginning in 1917 Murphy, as an appointee of President Wilson, worked for the Red Cross in France and as an officer in the Army:
“Douglas MacArthur took over the brigade and received his first general's star. … The 42nd also got a new G3, Major Grayson M.P. Murphy, a West Point graduate who had left the army to pursue a very successful career in finance and banking. Murphy had come to France as head of the American Red Cross, and in June 1917, went with Pershing to Chaumont as a part of the permanent staff of AEF Headquarters. While on Pershing's staff, Murphy coordinated Red Cross activities with the army's medical service in the field. His West Point background and good service in the infantry in the Philippines impressed Pershing enough to send him to the 42nd Division in the critical position of G3 [operations and planning].” (12)
“Your Servant—The Red Cross”
According to an article styled “Your Servant—The Red Cross” by Geddes Smith, published in The Independent
in 1917, the work performed by the Red Cross War Council in World War I
closely resembled contemporary services provided under contracts
awarded to Halliburton, a profit-making corporation, for the soldiers in
Iraq. Geddes describes those services as follows:
“The Red Cross is servicing France. [We only hope no pun was intended!] The War Council, thru its commissioners, asked France what immediate service was most wanted. ‘Give us canteens,’ was the answer…. The word canteen … means, first, a field kitchen close behind the first line of trenches from which hot coffee and tea … and cold lemonade and such drinks are served out to fighting men…. It means, also, an outpost of civilization—a place where a poilu leaving the front can … shave and wash his mud-stained body and disinfect his germ-laden clothing…” (13)
Rambling with Wild Bill Donovan
Within
a year after the war’s end, Murphy returned again to Europe with a man
who was to become the first American head of a civilian intelligence
organization in America, William J. Donovan. According to Donovan’s
biographer, the job Donovan and Murphy performed was to gather
information concerning a proposed Morgan bank bond issue for a
consortium of capitalists who wanted statistics from Europe before these
bankers, lawyers and investors underwrote, bought or sold bonds for
European reconstruction; the names of the capitalists, however, were not
disclosed. (14)
Donovan and Murphy “toured Europe together to make their own
intelligence estimates and establish a private intelligence network to
keep them and like-minded members of America’s ‘peacetime’ intelligence
subculture advised of changes in Europe.” (15)
Morgan Syndicate
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| Raskob with his boss, Du Pont |
Professor
Carroll Quigley, of the opinion that there were different factions
within the Morgan bank establishment, stated in his book Tragedy and Hope:
“To Morgan all political parties were simply organizations to be used, and the firm always was careful to keep a foot in all camps. Morgan himself, Dwight Morrow, and other partners were allied with Republicans; Russell C. Leffingwell was allied with the Democrats; Grayson Murphy was allied with the extreme Right; and Thomas W. Lamont was allied with the Left.” (16)
Thomas Lamont’s rise in influence within the bank followed the chairmanship of World War I head of the American Red Cross, Henry Pomeroy Davison, (17)
whose banking career had begun in the Astor Bank, and who reared his
sons (F. Trubee Davison and H.P., Jr.) at Locust Valley, Long Island,
New York, near the estate of Robert S. Lovett. Lamont's "left-leaning tendencies" caused concern
among members of the more conservative faction, who detested the role Leffingwell
and Lamont had played in advising FDR to take the dollar off the gold
standard. In response
to removal of the gold backing on the dollar, Roosevelt’s own budget director, Lewis W. Douglas (who was brother-in-law of Rockefellers' attorney John J. McCloy), predicted the end of Western Civilization, while
Montagu Norman of the Bank of England (also a Brown Brothers partner) feared the entire world would
plunge into bankruptcy. (18)
These
apocalyptic opinions reflect also the sentiments of the Anglo-American
political philosophy supported by the same bankers who desired to rid
the world of anti-capitalism—any tendencies leading to labor unrest and
anarchy—which they equated with Communism. The British Foreign Secretary
in 1925, Austen Chamberlain, for example, had commented:
“If I ever had to choose in my own country between anarchy and dictatorship, I expect I should be on the side of the dictator.” (19)
Six years after Alfred Corning Clark died, his widow married the Right Rev. Henry Codman Potter, Episcopal Bishop of New York, who serves as a link between Clark and an offshoot of the family of Alexander Brown of Baltimore, the oldest merchant banking family in America.
Brown Brothers of New York is the bank with which President George H.W. Bush’s father was a partner after its merger with the investment banks of the sons of robber baron E.H. Harriman in 1926.
NOTES:
1. Quincy Howe, England Expects Every American To Do His Duty (New York: Simon & Schuster, 1937), 198.
2. The quotes from MacGuire were obtained from Wikisource website.
3. Retired General Johnson (West Point Class of 1903) was then administrator of the National Recovery Administration. Time magazine (October 31, 1934)
reported: “Each and every reporter at Hyde Park was aware that General
Hugh Samuel Johnson had at last cooked his goose with the President. In
his speech on the textile strike week before, NRA’s Johnson had
denounced the strikers in such violent terms that Labor swore it would
have the General’s scalp. In the same address General Johnson sealed his
official doom, as far as the President was concerned, when he said:
‘During the whole intense [NRA] experience I have been in constant touch
with that old counselor, Judge Louis Brandeis. As you know, he thinks
that anything that is too big is bound to be wrong. He thinks NRA is too
big, and I agree with him.’ Vastly displeased was the President with
General Johnson’s public claim to intellectual kinship with Supreme
Court Justice Brandeis, before whom the National Recovery Act must
sooner or later come for adjudication.”
Time
had first reported on Johnson’s background as follows: “He set up the
General Staff's Purchase. Storage and Traffic Division to eliminate
competitive government buying, sat on the War Industries Board with
Bernard Mannes Baruch. Resigning from the army in 1919 as a Brigadier
General, he joined the Moline (Ill.) Plow Co. of which George Nelson
Peek, new administrator of the Farm Relief Act, was president. In 1927
he went to Mr. Baruch at No. 120 Broadway as economic expert and
factfinder. Mr. Baruch lent him to President Roosevelt to help draft the
Industrial Recovery Act.” Time (May 29, 1933).
4. “America's Armed Forces: Part 2—In Time of Peace: The Army,” Common Sense (October 1935), page 8.
5. Jules Archer, The Plot To Seize The White House (New York: Hawthorn Books, 1973).
6. The correlation between the two committees is shown in an article by David Kyvig at the website maintained by the Coalition to Oppose the Arms Trade (COAT).
7. The entire list of the membership was published by the Washington Post in 1928 under a front-page headline “New Wet Board’s Purpose Mystery to Party Leaders.” Washington Post (April 23, 1928), 1.
The
names listed were determined by the Post to be disproportionately
Republicans, who would later abandon Herbert Hoover in order to elect
Franklin Roosevelt. Besides Murphy, the name of George H. Walker
(grandfather of the first President Bush) was also listed. At that time
he was employed by W.A. Harriman & Co., which in 1931 was to merge
with the established private banking firm of Brown Brothers & Co.,
of which Bank of England chairman Montagu Norman was a partner.
8. William R. Corson, The Armies of Ignorance: The Rise of the American Intelligence Empire (New York: The Dial Press/James Wade, 1967), 597.
9.
This trip to Venezuela occurred at the same time that an international
lawyer who was a leader in the Pan-American Society, Dr. Severo
Mallet-Prevost of Philadelphia (son of Dr. Grayson Mallet-Prevost),
sailed to Venezuela in order to promote a loan to be made by Speyer
& Co. It appears that Dr. Mallet-Prevost was Murphy’s uncle.
10.
The transcript of the hearings of the Committee, often referred to as
HUAC or the “MacCormack-Dickstein Committee,” can be found online in
three segments, together with Smedley Butler’s brochure, War Is a Racket and other materials about the plot.
11.
The Congressional Committee Report, however, upon examining the
membership list, did not find those names. See Report of Congressional
House Special Committee on Un-American Activities, 73rd Congress, 2d
Session (New York: November 24, 1934). Also see the chapter entitled
“Wall Street Buys the New Deal,” in Antony C. Sutton, Wall Street and FDR
(New Rochelle, New York: Arlington House Publishers, 1975). Had Butler agreed to speak at the convention, he would have
received no less than $18,000 in cash for reading a speech written by
John W. Davis, demanding a return to the gold standard.
12. James J. Cooke, The Rainbow Division in the Great War, 1917-1919 (Praeger Publishers, 1994), 133, citing as source: John J. Pershing, My Experiences in the World War
(New York: Frederick A. Stokes Co., 1931), Vol. 1, 71, 108, 280. The
author also cites fascinating excerpts from General Patton’s diary
relating run-ins he encountered with Murphy: “Maj [sic] Murphy told me
he could not put smoke in plan as stencil was already cut. The biggest
fool remark I ever heard showing just what an S.O.B. the late chief of
Red Cross is.” Cooke, 148, quoting from Martin Bluenson (ed.), The
Patton Papers, 1885- 1940, Vol. 2 (Boston: Houghton-Mifflin Co., 1972),
628.
13. Geddes Smith, “Your Servant—The Red Cross,” The Independent; 91, 3590 (September 22, 1917), 462.
14. Richard Dunlop, Donovan: America’s Master Spy
(Chicago: Rand McNally & Company, 1982), 137. We can reconstruct
the names of those investors were by examining the bond issues
underwritten immediately after their summer tour in 1920.
15. William R. Corson, The Armies of Ignorance, op. cit., 598.
16. Carroll Quigley, Tragedy and Hope: A History of the World in Our Time (New York: The Macmillan Company, 1966), 945.
17.
“Davison …conceived the plan which resulted in the formation of the
Bankers' Trust Company, intended to serve as a depository for the funds
of national banks and insurance companies. In 1902 George F. Baker and
Francis L. Hine of the First National Bank invited him to become
vice-president and director. There he soon won recognition from J.
Pierpont Morgan, Sr., who frequently consulted him, especially in the
monetary crisis of 1907, when Davison had an important part in
determining the action of New York banks. During the next year he joined
the Monetary Commission headed by Senator Aldrich and in the capacity
of banking expert with that commission he visited France, Germany, and
England. He then acquainted himself with the prevailing European idea of
a flexible national currency. In association with Senator Aldrich, Paul
M. Warburg, Frank A. Vanderlip, and A. Piatt Andrew, he took part in
drawing up the ‘Jekyl Island’ report that led to the crystallization of
sentiment resulting in the creation of the Federal Reserve System.
Having become a partner in J. P. Morgan & Company, he served with
distinction in 1910 as chairman of the Six-Power Chinese Loan Conference
at Paris.” Dictionary of American Biography Base Set. American Council of Learned Societies, 1928-1936.
18. Ron Chernow, The House of Morgan: An American Banking Dynasty and the Rise of Modern Finance (New York: Atlantic Monthly Press, 1990), 358-359.
19. Quoted in Clement Leibovitz and Alvin Finkel, The Chamberlain-Hitler Collusion (UK: Merlin Press Ltd., 1997), 39.
20. Published by World Peace Foundation (1927), 718.
