Evening star., 1951-03-13
The Political Mill
FuIbright Probers Show
How Money Is Made
Influence PeddIing Reaches
Mammoth Proportions
The Political Mill
BY Gould Lincoln

Traficking in influence in Washing
ton, the National Capital, in mammoth
proportions is finally being disclosed
through congressional investigation. The
"5-percenter" inquiry conducted during
the last Congress apparently merely
scratched the surface. The Fulbright
subcommittee of the Senate Banking
and Currency Committee, in its current
investigation, particularly of political
and other influence exerted on the Re-
construction Corp. for big money loans,
has delved far deeper. But like the
earlier IS = percenter" investigation
which revealed gifts of free deep freezes.
distributed through the courtesy Of Maj.
Gen. Harry H. Vaughan, military aide
to President Truman, the Fulbright
committees inquiry has turned up. in
it's lighter moments free mink coat.
valued at $9.450. paid for by an alleged
trafficker in influence, belonging to a
White House stenographer. The "fur
coat" adminiStration-what next?
Further, Donald S. Dawson. one Of
the Presidents administrative assist
ants whose wife is employed at the
RFC, has been mentioned by the Senate
subcommittee as having been notable
exertion of influence on the RFC Board,
loans-of Government money. Mr. Daw-
son, though invited by Senator Fulbright
of Arkansas, chairman of the commit
tee, to appear and answer questions, has
so far ignored the invitation.
How to Make Money.
How really to make money in Wash
ington when you know the ropeS-and
have influence, TOBIAS just been spot
lighted by the Fulbright committee. The
case involved former Representative
Casey, Massachusetts Democrat. Mr..
Casey, an attorney who has in the past
frequently represented clients seeking
loans, or having loans, from the RFC.
The committee stumbled on trans
action which Mr.. Casey had with
the Maritime Commission, during Mr.
Caseys appearance to reply to charges
he had been engaged in wrongful in
f1uence peddling and had taken into
his employment an examiner of the
RFC after the examiner had been in
strumental in obtaining a loan for q
Casey client.
Mr.. Casey told the committee. under
examination, how he had negotiated
the purchase of five tankers in 1916
from the Maritime Commission, a loan
from an insurance company to purchase
the ships for ST 500 000-hah what they
cost the Government-how he had set
up the American Overseas Tanker Co.,
and a twin corporation, the Greenwich
Marine Co., Panamanian affair. The
tankers were chartered to the Standard
Oil Co. of New Jersey, which paid the
Panamanian company for the use Of the
tankerS. In turn the Panamanian COM
pany paid off the loan of the insurance
company, which amounted to $40 million.
After four years, the tankers were sold
to another company and the investors in
the American Overseas Tanker Co. made
profits running up to something like
S2.8 million. These profits were treated
as capital gains, on which mere rs
per cent tax is levied. The company
had only capital stock of 100000. Mr..
Casey had put up $4,000, and when the
transaction was completed he had $270,-
900, on which presumably he paid the
25 per cent tax, leaving him profit Of
some 100000. Incidentally, tax rul-
ing of the Treasury Department helped
pave the way for this transaction.
Standard Set Here.
Nothing illegal is the standard set
in Washington-and apparently the only
f1uence to put across financial deals.
One thing the Senate subcommittee has
been striving to determine is how much.
if any, pressure has been put upon the
RFC by men in public Office and whether
it actually goes to the White House door,
through any activities of Mr.. Dawson.
The committee has succeeded in show
ing that attorneys here have received
big fees for engineering RFC deals-so
far they have not turned up anything
Illegal" But they have had testimony
before their committee which may lead
to charges of perjury, and this testimony
has been turned over to the Justice
Department and it will go before Fed
eral grand jury.
The grand jury itself may throw
additional light on what goes on in
trafficking in influence.