CHAPTER XVIKennedy Makes a Wobbly Start
President John F. Kennedy had been in office only ten days when he gave his “State of the Union” address on January 30, 1961. His comments on making information available to Congress were general in nature and seemingly consistent with his campaign pledges. President Kennedy said:
“Our Constitution wisely assigns both joint and separate roles to each branch of the Government; and a President and a Congress who hold each other in mutual respect will neither permit nor attempt any trespass. For my part, I shall withhold from neither the Congress nor the people any fact or report, past, present, or future, which is necessary for an informed judgment of our conduct or hazards. I shall neither shift the burden of executive decisions to the Congress, nor avoid responsibility for the outcome of those decisions.”
President Kennedy was not so specific on the subject as Candidate Kennedy had been, nor was he as precise as the Democratic platform on “Freedom of Information.” The Democratic platform said:
“We reject the Republican contention that the workings of government are the special private preserve of the Executive. The massive wall of secrecy erected between the Executive branch and the Congress as well as the citizen must be torn down. Information must flow freely, save in those areas in which the national security is involved.”
During the 1960 campaign, President Kennedy made amost forthright declaration on the responsibility of the President to keep the citizens fully informed so that democracy would flourish.
“An informed citizenry is the basis of representative government,” he said. “Democracy—as we know it—cannot exist unless the American people are equipped with the information which is necessary if they are to make the informed political choices on which the proper functioning of the democracy depends. An informed people—able to examine, and when necessary, to criticize, its government—is the only guarantee of responsible democracy.”
As a candidate, Kennedy also declared that the President had much more than a negative duty.
“The President—who himself bears much of the responsibility for the preservation of American democracy—has the affirmative duty to see that the American people are kept fully informed. It is true that in today’s world of peril some Government information must be kept secret—information whose publication would endanger the security of national security—the people of the United States are entitled to the fullest possible information about their Government—and the President must see that they receive it.”
Senator Kennedy said that the “executive privilege” should be reserved for the exclusive use of the President. He added that when information is not restricted by specific statute, security needs, or the Constitution, “there is no justification for using the doctrine of ‘executive privilege’ to withhold that information from Congress and the public.”
On February 4—only two weeks after Kennedy’s inauguration—Secretary of State Dean Rusk wrote Representative Porter Hardy.
“Just a note to let you know that we have not forgotten the question on the availability of records. I am working with our new legal adviser, Mr. Abram Chayes, and hope that he can be in touch with you during the coming week. Let meassure you that we will move on this matter as promptly as possible.”
Chairman Hardy was now optimistic about gaining access to the reports and papers of the International Cooperation Administration programs in Peru and six other Latin-American nations. Three days later, Chayes called at Hardy’s office, and the following day Chairman Hardy wrote a friendly little note to Secretary of State Rusk saying that he trusted the access problem “will be resolved quickly.”
More than two weeks passed without action, however, and with each day Chairman Hardy became more irritated. On February 28, he wrote Rusk prodding him again on the need for the documents on foreign-aid programs in Brazil, Uruguay, Argentina, Chile, Bolivia, Peru, and Colombia. The subcommittee has “directed the staff to examine all executive branch documents and files relating to the U.S. aid operations in the aforesaid countries and to interview such department and agency personnel as may be necessary.”
There was still no action from Secretary of State Rusk, and ten days later Hardy had reached the end of his patience. He wrote a letter to President Kennedy and delivered it to the White House to President Kennedy’s appointment secretary, Kenneth O’Donnell.
It was a Friday afternoon, and O’Donnell informed Chairman Hardy he would put the letter in the President’s hands the first thing Monday morning. Hardy said he felt this was important enough that it should be delivered to President Kennedy that day, for he planned to conduct hearings on the affair on Monday. O’Donnell said he would get the letter to the President immediately.
Hardy’s letter informed President Kennedy of the background of delays, and the promise of the new administration made to find a speedy solution.
“Seven weeks have now elapsed since the inauguration and I have no reason to believe that a workable solution isany nearer than it was on December 9, 1960, under the former administration,” Hardy wrote. “You may recall that it was on that date that the Comptroller General prohibited further use of program funds for expenses of the office of the Inspector General and Comptroller because of its failure to furnish my subcommittee with requested documents in accordance with ... the Mutual Security Act of 1954, as amended.”
Hardy was polite but direct:
“I regret the necessity of bringing this matter to your attention, and would be reluctant to intrude on your busy schedule if I were not aware of the importance of this matter to you. In this connection, I feel you should know that it is my present plan to hold a meeting of my subcommittee on Monday of next week to discuss the advisability of scheduling promptly a hearing to which Secretary Rusk would be invited to inform the subcommittee concerning the extent of co-operation which we can expect in securing the information necessary for us to discharge our constitutional and statutory responsibilities.
“As I am sure you are aware, I have made every effort to avoid the necessity of seeking a solution to the problem in this manner. However, I feel that the lack of success of other methods to date leaves me no alternative.”
Before Hardy had reached his home, President Kennedy had called and left a number. This wasn’t somebody calling for the President, but the President himself. Hardy returned the call, and was assured by President Kennedy that Secretary of State Rusk would be in touch with him. Rusk called a few minutes later, and promised immediate action on the information problem.
Hardy said that if he could be assured of getting some satisfactory discussions on Monday, he would be glad to wait until that day for official word from Rusk.
Rusk’s letter of Monday, March 13, stated:
“The Department shares with you a deep concern that the foreign aid programs which are so important to the success of our foreign policy, should be administered effectively and in a manner that is above reproach.
“I have therefore directed the officers of the Department concerned to co-operate fully with you and your staff to expedite your investigation and to make available to you all information and documents relevant to your inquiry which we properly can.”
Chairman Hardy took Secretary Rusk at his word and assumed that records would be made available. The next morning Hardy called Assistant Secretary Brooks Hays to inform him that a staff investigator would be visiting the office of the Inspector General and Comptroller with instructions to talk to personnel in that office. He asked that Hays do what he could to assure that Investigator Walton Woods receive a co-operative reception.
However, when Woods showed up at the office of Acting Inspector General James E. Nugent and asked to speak with Investigator Michael J. Ambrose he was refused permission. Nugent said that as far as he was concerned the orders under the Eisenhower administration were still in force, but that he would check with Legal Counsel Chayes to see if there had been a change. Later Woods returned to Nugent’s office and was informed by Nugent that no files or documents from the Office of the Inspector General were to be made available to the subcommittee.
Chairman Hardy was amazed that the same roadblocks continued to exist. On March 16, 1961, he again wrote Rusk relating what had happened and commenting:
“In spite of these developments I cannot believe that this administration is disposed to adhere to the withholding policies of the prior administration.”
Then Hardy let Rusk know that despite all the roadblocks put in the way of the subcommittee, information had alreadybeen obtained that raised serious questions about the operation of the ICA policing system.
“The data which we have already assembled independently give us reason to question whether either the Office of the Inspector General and Comptroller or its predecessor organization has performed in a satisfactory manner,” Hardy wrote.
“An office like this, exercising as it does an internal watchdog function, is of particular concern to a subcommittee such as ours. For when the Congress can be assured that such an office is doing a good job, then the areas where independent congressional inquiry may be required become fewer and smaller, and the work of Congress is accordingly simplified. Certainly we cannot evaluate the work of this office [OIGC] in any particular, if we are not permitted full access to its files and interviews with its personnel.”
When Chairman Hardy called a hearing five days later on March 21, the witnesses showed up with letters of instructions flatly barring testimony. Secretary of State Rusk supplied each witness with the form letter prohibiting free testimony “concerning the conduct of the foreign aid program in Peru.
“I am writing this letter to instruct you that you are not authorized to testify concerning the contents of any files of the International Cooperation Administration or the Office of the Inspector General and Comptroller in the Department of State which relates to an investigation into charges of misconduct on the part of individuals or corporate persons or, more generally, to testify concerning any matter involved in such an investigation carried on by the International Cooperation Administration or the Office of the Inspector General and Comptroller in the Department of State.”
So this was what the Kennedy administration called “co-operation” to “expedite your investigation and to make available to you all information and documents relevant to yourinquiry which we properly can.” Chairman Hardy had hoped for better, but concluded that it was time to end the polite letter writing and get down to tough talk.
“Until this morning,” he declared, “it was my sincere hope that we would see some real improvement.”
Hardy had been frustrated for a full year in his effort to gain access to the key documents on foreign aid in Peru. And the Kennedy administration, in office already two months, had done nothing to change the system that covered up for the dishonest and the incompetent people who wasted foreign-aid funds. Worse yet, it developed that twelve witnesses Hardy called in carried identical letters of instructions from Rusk to refuse to testify or produce records on any investigations conducted by ICA.
Hardy denounced the Rusk letter as “the most arrogant instruction” ever given to government witnesses. Representative George Meader declared that “a curtain had been rung down” on the operations of the ICA.
Meader, the highest ranking Republican on the Hardy subcommittee, demanded that Secretary Rusk should be brought before the subcommittee to explain the barriers he was erecting against investigations by Congress.
When Chairman Hardy agreed to call Rusk the very next day, State Department officials said “it would be very difficult” for Rusk to appear at that time for he was leaving the following evening for Bangkok and a major international conference of the Southeast Asia Treaty Organization nations.
Hardy declared that Rusk would be summoned before the subcommittee when he returned from the international conference, and that in the meantime he would be calling all other responsible State Department officials in an effort to get to the bottom of the stalling.
For the record, he reviewed the long struggle to get information on the Peru program from the Eisenhower administration. He also related the details of the patient two-monthwait to give the Kennedy administration sufficient time to examine the problem carefully.
Then, to light a fire under the issue, Chairman Hardy disclosed enough information to make it obvious that he was on the trail of multimillion-dollar scandals in the handling of foreign aid in Peru. He revealed that 2 million dollars in U.S. funds were spent on a farm-to-market highway which led only to unarable mountainous land. It was started before plans were completed, plans were changed while it was being constructed, and the funds ran out when it was only half finished.
He also told about an irrigation project built at Pampas de Noco. It cost $125,000 of Americans’ money, but it didn’t work because there simply was not enough water available in the area to make use of the projected irrigation works.
John R. Neale, director of the United States Operations Mission in Peru, had acquired a $200,000 interest in a ranching corporation that received aid under the U.S. program. Although Neale had resigned in 1958, there were indications that key ICA and State Department personnel had protected him from a thorough investigation for months.
Hardy revealed widespread irregularities in the 14-million-dollar drought relief program in Peru. He had testimony that as much as 60 per cent of the so-called “drought relief” went into unauthorized channels and was no help to the drought victims.
Chairman Hardy made certain that President Kennedy was apprised of the nature of the mismanagement and fraud being hidden by the State Department. The reaction was fast, and the Rusk letter of instructions was slapped down by the White House on direct orders from President Kennedy.
Brooks Hays, the former congressman and Assistant Secretary of State for Congressional Relations, assured ChairmanHardy that the Rusk instructions would be rescinded, the documents released, and witnesses freed to testify.
Witnesses called by Hardy a week later, on March 29, did testify freely. These witnesses produced a letter from State Department Legal Counsel Abram J. Chayes instructing them to forget the whole thing. Chayes wrote:
“The instructions contained in the letter of March 21, 1961, addressed to you by Secretary of State Dean Rusk, are hereby withdrawn. In view of this fact, I would appreciate it if you would return the letter to me and treat it as though it had not been sent.”
Nothing that Chayes could write, however, could erase from some people’s minds the memory of this clumsy and arrogant effort of the State Department to withhold. To ensure its perpetuity, Representative Meader rose on the House floor two weeks later, on April 17, to recite the story for theCongressional Record.
“In recent years, ambitious bureaucrats have concocted and promoted the so-called doctrine of ‘executive privilege,’ which, in my judgment, is a myth,” Meader said. “In my view, there is no right or power in the executive branch of the Government to decide what facts Congress needs concerning the conduct of the public business.... That decision is clearly and properly a legislative decision.”
Meader declared that “the struggle between bureaucrats who wish to hide their activities and committees of Congress insisting on access to complete and accurate information concerning public business ... has not received the attention it merits.”
The Michigan congressman was a Republican, to be sure, but he was one of a handful who could not be accused of playing partisan politics with this issue. No man in Congress insisted any more aggressively than George Meader that the Eisenhower administration make records available to the public, to Congress and the General Accounting Office.When Meader quoted President Kennedy’s January 30 address on the state of the Union, he did not do so in a malicious or partisan manner.
Kennedy had said: “For my part, I shall withhold from neither the Congress nor the people, any fact or report, past, present or future, which is necessary for an informed judgment of our conduct and hazards.”
“I wish this sentence could be printed in capital letters in theCongressional Record,” Meader said. “Many of us welcomed that clear, forthright statement as heralding a new policy in the executive branch of the Government with respect to furnishing information to congressional committees on request.”
Representative Meader was not critical of President Kennedy for the delays on Peru, for President Kennedy had personally overridden his Secretary of State. But Meader was wary of the future.
“As the bureaus and agencies in the executive branch of the Government have grown in number, and in power,” he said, “there has been a parallel growth in their efforts to shroud in secrecy the manner in which they discharge their stewardship of the public authority and moneys entrusted to them.”
Meader declared that “the question remained whether that laudable generality [in President Kennedy’s address of January 30] would be actually carried out in practice” or whether there would be “procrastination and recalcitrance on the part of officials.”
Within two weeks of the March 29, 1961, showdown, the Hardy subcommittee was receiving the documents on the U.S. aid program in Peru. These were the documents, the release of which Attorney General William P. Rogers had said “would gravely impair the proper functioning and administration of the executive branch of the Government.”
What the reports did do was to document fully the sloppy,wasteful, and corrupt administration of foreign aid in Peru.
From the outset the Peru drought relief program had been riddled with irregularities. There were shipments of 106,000 tons of grain meant to be sold to help needy drought victims but which were sold, without authorization, to pay administrative costs, port charges, and inland transportation costs. Above all, the grain was not meant to be sold, as it was, for the profiteering of grain millers in Peru. It wasn’t to be sold to raise money to buy houses to be sold to influential Peruvians at less than cost.
The mismanagement of the program was so raw that it hadn’t completely escaped detection in Washington. A desk officer in 1957 had figured that only 12,000 tons of the first 45,000 tons had been accounted for and asked: “Who received the rest of the grain?”
No one answered his question, however, either in the Washington ICA office or at the Embassy in Peru. When a Washington auditor was finally sent to Peru, he found that no end-use checks had been made by the United States Operations Mission (USOM). He stated:
“The lone USOM auditor, a local employee, stated that USOM officials issued orders that no checks were to be made beyond the offices of the committees selling [drought aid] foods. Thus, end users were not contacted and no determination could be made as to the proper utilization of food.”
Within the State Department and the ICA no aggressive action was taken to find out whether there was any substance to the complaints of conflicts of interest, waste, and major misuse of funds. Lethargy, incompetence, excuses, and cover-up prevailed.
When Dr. Raymond C. Gibson, an employee of the Office of Education, returned from an official visit in Peru, he called attention of high officials of ICA to the activities of John R. Neale, head of the USOM in Peru, who had a large interest in a farm receiving benefits of ICA funds.
Instead of investigating Neale’s holdings, top ICA officials characterized Gibson’s complaint as “character assassination.” The officials did assign an investigator to the case but told him to “assure Neale of our belief in his integrity.”
Within a few months, the case had become known within ICA not as the Neale case, but the Gibson case. ICA started a full field background investigation of Dr. Gibson, and one official pledged to hold Dr. Gibson to “full accountability” for filing a complaint against Neale.
The ICA investigators overlooked information in the ICA files which disclosed that Neale’s family had an interest in a Peru ranch. Continued complaints finally forced ICA hearings on Neale in 1958, but even then his character witnesses included the American Ambassador to Peru, Theodore Achilles, and Rollin S. Atwood, regional director of the Office of Latin-American Operations of the ICA.
“When Achilles and Atwood appeared before the ICA hearing board as character witnesses for Neale, they seemed more concerned with the motivations of the complainants than they were with the truth of their allegation,” the report of the Hardy subcommittee stated.
“The high position of Neale and the high position of his uncritical supporters, Atwood and Achilles, somewhat cowed the investigators assigned to this case.
“At the time of his removal, Neale had been affiliated with the Bazo Corporation [the ranching operation] for over eight years, and for at least four of those years ICA had in its possession sufficient information to warrant an investigation which ... would have turned up the basic facts.
“It was congressional intervention that precipitated the Guinane investigation”—the final investigation that brought about Neale’s resignation.
“All employees of ICA seem to know, without being specifically instructed,” the subcommittee report went on, “that the preferred policy of the agency, and the Embassy in thisinstance, is to brush this sort of instance under the rug, with a quiet ‘resignation’ or ‘retirement.’”
“Although the old office of Personnel Security and Integrity in ICA was primarily responsible for the ineffective investigation in the Neale case, its successor, OIGC, did not perform with any more credit in a related matter.”
The ICA had used “executive privilege” to cover up its failures for several years. Instead of learning from past failures, the agency continued its negligence with full confidence that “executive privilege” could hide the failures from Congress, the General Accounting Office and the public.
The details of the scandals had not been known to President Eisenhower, nor had he known of the incredible laxity in the investigative units in the ICA. However, by promoting a secrecy cloak for the investigators of ICA he had allowed the ICA to hide the major defects in a vital part of an agency administering approximately 4 billion dollars a year.