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The Truth is Out There

Wednesday, March 11, 2009

Every Bush administration security policy was shared with the Democratic leadership in dozens of briefings.

Senator Patrick Leahy (D-Vermont) is pursuing a “Truth Commission” to investigate policies and actions adopted by the Bush administration in its prosecution of the War on Terror. The effort calls to mind a similar effort that occurred 75 years agothe 1934 McCormack-Dickstein Committee hearings. Before the JFK or Vince Foster assassination conspiracy theories, before the theories that the moon landing was fake or that the Mossad was behind September 11, there was the similarly wild-eyed Business Plot conspiracy theory, and its weird allegations reverberate to this day.

Major General Smedley Butler was a left-leaning military hero prone to intemperate remarks. He retired in 1931 after insulting the Secretary of the Navy and a 1932 Senate run was a failure. In 1934, Butler approached Congress with sensational allegations: business leaders were plotting a fascist coup against the White House! Two Democratic representatives, John McCormack and Samuel Dickstein, saw an opportunity to score political points against New Deal opponents and convened a committee to investigate the story.

It was a miscalculation. Butler’s lurid story was wildly improbable: business leaders would put up $30 million for Butler to lead an army of 500,000 men to Washington to depose President Roosevelt. It was never convincingly explained why Wall Street would choose Butler, an anti-capitalist who made his living after the Marines by giving a speech called “War is a Racket,” which blamed World War I on “industrialists.” 

Moreover, the entirety of Butler’s theory was based on the stories told him by a single mana 38-year-old bond trader named Gerald MacGuire who made $75 per week and whom Butler alleged was the mastermind. MacGuire denied everything and the big headlines quickly turned to scoffing. The New York Times sneered that Congress had been taken in by a “gigantic hoax” and called Butler’s tale a “bald and unconvincing narrative.” If Butler didn’t entirely invent the story, it was only because MacGuire was apparently attempting to use Butler as part of an elaborate failed con to obtain funding from millionaires such as Robert Sterling Clark. 

The Obama administration is quickly learning that the policies they complained about during the presidential campaign are not as black-and-white as they professed to think now that they are in office.

The committee dissolved, issuing a wan report finding that Butler and MacGuire had met, but refusing to endorse—or release—Butler’s hearsay testimony against big names like J.P. Morgan and Thomas Lamont. This led to the first of many conspiracy theories; the Communist New Massesmagazine published excerpts of the unreleased testimony and made fevered allegations of a Jewish banking conspiracy. But the Department of Justice, rarely reluctant to bring the full power of government against FDR’s political enemies such as Andrew Mellon, refused to issue indictments. The matter was largely forgotten except that Butler was further discredited in polite company.

(Decades later, conspiracy theorist John Buchanan made wild claims that George W. Bush’s grandfather, Prescott Bush, was part of the supposed conspiracy. One of Butler’s hearsay allegations was that the American Liberty League was involved, and Bush—along with Democratic presidential candidates John W. Davis and Al Smith, future Secretary of State Dean Acheson, and 125,000 other people—was a member of the anti-New-Deal group. By alleging without any evidence that FDR cut a secret deal with Wall Street for its support of the New Deal, Buchanan ignores the fact that the Liberty League and the business community continued to oppose the New Deal and got its central component, the National Industrial Recovery Act, struck down in court. Nevertheless, the BBC gave Buchanan a soapbox to repeat his fictions in a “documentary,” a sad reminder of how low the once-revered BBC will go when given the opportunity for Bush-bashing.)

Senator Leahy’s proposed “Truth Commission” would also end up being a laughingstock for Democrats. The idea’s supporters have forgotten that every Bush security policy that the left wing of the party complains about—from Guantanamo to interrogations to surveillance—was shared with Democratic congressional leadership in dozens of briefings. The Obama administration is quickly learning that the policies they complained about during the presidential campaign are not as black-and-white as they professed to think now that they are in office.

Ted H. Frank is a resident fellow at the American Enterprise Institute.

Image by Darren Wamboldt/The Bergman Group.

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