What was Big Oil’s problem with Kennedy? The oil barons – the Hunts, Clint Murchison, Sid Richardson, had ruled the world from Texas for years. In the 1960’s that grip began to come lose. In September, 1960, Iran, Iraq, Kuwait, Saudi Arabia and Venezuela met at the Baghdad Conference to form the Organization of Petroleum Exporting Countries (“OPEC”). OPEC’s goal was to secure fair and stable prices for its member countries. The United States was excluded. Then, in 1960, John Kennedy was elected President. Unlike Eisenhower, Kennedy was not a friend of “big oil”; nor was he susceptible to the kinds of “gifts” that had been bestowed on his predecessor. His agenda included reducing the Oil Depletion Allowance, a tax break for oilmen that was unprecedented in American business – permitting an oilman to deduct 27.5 per cent of the oil produced in each of the first ten years of a well’s operation, regardless of the amount the oilman had invested in the well.
Since the 1930’s, Texans had protected their tax benefits by assuming key positions in Washington and by bribing whoever needed to be bribed. John Nance Garner became Speaker of the House. Texans chaired five of the House’s most influential committees: Sam Rayburn became chair of the Interstate and Foreign Commerce Committee; Joseph Mansfield chaired the Rivers and Harbors Committee; Hatton Sumners the Judiciary Committee; Marvin Jones the Agricultural Committee and Fritz Lanham the Public Buildings and Grounds Committee. Texans held power in the House for most of the time from 1931 to 1961 – from Rayburn in the House to Johnson in the Senate. Oilmen funneled huge amounts of cash through Johnson to “influence” Congress to leave the Oil Depletion Allowance and other benefits in place.
Then Kennedy was elected. Even worse, Lyndon Johnson, big oil’s man in the Senate, was now powerless as Kennedy’s Vice President. Though Kennedy at first promised to support the allowance, by 1962 he set off on a legislative agenda to curb big oil’s profits and power. In October 1962, Kennedy persuaded Congress to pass an act which reduced oilmen’s earnings on foreign investment from 30 per cent to 15 per cent.
In January, 1963, Kennedy proposed a set of tax reforms that would eliminate the depletion allowance. If passed, it would have caused a loss of around $300 million a year for Texas oilmen.
Clint Murchison, an oil millionaire whose wealth was nurtured and preserved by the oil depletion allowance, ran the the Del Charro Hotel in La Jolla, California. The Del Charro was not run for profit. Hotel “guests” generally didn’t pay for food or lodging.
The frequent guests were all power figures like J. Edgar Hoover (Director of the FBI), Carlos Mossello (New Orleans Mafia head), Richard Nixon (who lost the 1960 presidential election to Kennedy), Bobby Baker (Johnson’s right hand man and secretary of the US Senate), a wealthy man named D.H. Byrd (the owner of the Texas Book Depository) and Edward Clark, a politician and lobbyist (for Murchison) who came to be known as the “arranger”. Another guest was William K. Harvey, a former FBI man who worked with the CIA’s foreign assassination projects.
What did Murchison’s guests plan while lounging around the pool at the Del Charro? Many stories have emerged – that Clark arranged the assassination, setting up sites in several different cities; that Murchison bragged to a group of friends the night before the assassinationthat Kennedy would never bother him again; that Hoover was in on the cover-up to prevent the disclosure of his homosexuality. These stories are hardly new – they have been circulating for years. Nothing has ever been proven.
What is clear, however, is that all the “guests” benefitted greatly from the assassination – Johnson became president and dropped all plans to remove the oil depletion allowance. Nixon also kept the allowance safe. Nixon and Bush (Senior) (head of the CIA) went on to become President. Hoover continued his position and avoided revealing his homosexuality. Gerald Ford, appointed to the Warren Commission by Lyndon Johnson, that found Oswald the “lone crazy shooter,” also eventually became President and pardoned Nixon. Texas oil companies benefitted enormously from the the wars in Vietnam, Iraq and Afghanistan.
Yet the involvement of Big Oil in the assassination was never investigated by either of the Government Commissions.
Gerald Ford started as a Republican congressman from a middle class family. He was known as a hard-working but otherwise unexceptional politician until Lyndon Johnson appointed him to the Warren Commission.
In the following eleven years, Ford did two unexplainable things.
First, for no apparent reason, Ford reported to the FBI about the private workings of the Warren Commission (see previous blog) and steered the Commission away from any suspicions about the results of the FBI investigation. (Report, USA Today. August 9, 2008). As a loyal Republican, Ford should have had no love or loyalty to the Johnson administration and no reason to divert a full investigation of the Kennedy assassination, yet that is what he did.
Ford remained in the House of Representatives for twenty-five years. Then, within less than a year, he became the first unelected President of the United States. On November 27, 1973 the Senate confirmed his nomination to replace Spiro Agnew, Nixon’s disgraced Vice President. On August 9, 1974, he became President upon Nixon’s resignation.
Then, on September 8, 1974 he pardoned President Nixon, an act which stopped the investigation into Watergate. It also sidetracked Congressional interest in the White House taping system that had been in place since the Kennedy Administration. The taping system was only discovered when Alexander Butterfield, Nixon’s assistant, spilled the beans during the Watergate investigation.
Ford’s pardon was viewed at the time as a “corrupt bargain” and led to Ford’s defeat By Jimmy Carter in 1976.
Ford lived to a ripe old age of 93, a model husband and father whose image was tainted only by his wife’s drug addiction.
When Ford died at his home in exclusive Rancho Mirage, he had become a moderately wealthy man. His wealth was due in large part to his investments with oil baron Marvin Davis. Davis Petroleum was a Texas Oil Corporation, established in the 1940’s by Marvin’s father. Davis, a lifelong Democrat was notorious for his purchases of Pebble Beach (and its later sale to the Japanese); of the Beverly Hills Hotel (which he later sold to a Sultan) and of Twentieth Century Fox Studios (which he later sold to Rupert Murdoch). Ford and Davis became good friends.
Ford’s investment with Davis flourished. Others were not so lucky. A.E. Investments a subsidiary of Aetna Life & Casualty, invested $168 million in Davis Oil. Davis urged the Aetna officers to trust him, Aetna later plead in court documents. the trust was misplaced. AEI received a little more than sixty million in revenue from its $168 million investment. Davis eventually settled the lawsuit. Davis was always suspected of kickbacks, overcharges and illegal profits, but the bad reputation didn’t rub off on Ford. (Vanity Fair, “The Man Who Ate Hollywood,” November 2005).
The link between Davis, a New Yorker, and the Texas tycoons, is an indirect one. Davis’s father, Jack, had founded Davis Oil Company in partnership with Ryan Oil Company. Ryan Oil Company was founded by a man named Jack Ryan. One of Jack Ryan’s claims to fame was having bilked Texan H. L. Hunt out of several hundred thousand dollars.
As a youngster, Marvin worked on oil rigs and learned the oil business. He expanded his father’s company into Texas in the 1940’s. Though he concentrated his business in Colorado, he undoubtedly rubbed elbows with the Murchisons, Richardsons and their political protege, Lyndon Johnson. Davis Oil had offices in Houston and Midland. Davis’s ownership of the Beverly Hills Hotel (acquired in 1986) is strangely reminiscent of Murchison’s acquisition of the Del Charro Hotel in La Jolla in the 1950’s (see previous blogs). It is not known whether Marvin stayed at the Del Charro. More about the Del Charro in future blogs.
Davis got into lots of trouble, with the FBI, the Department of Justice and was indicted in 1979 for violating oil price controls. Nothing slowed him down. It is easy to portray Davis as a man willing to ask for favors, and to do favors in return. And to not ask questions.
As to where Ford got the money to invest with Davis – there is no information.
Hoover’s relationship with Lyndon Johnson was not the only tie between the FBI and Texas. Hoover was a frequent guest (expenses comped) at Del Charro, Texas oilman Clint Murchison’s swank hotel in La Jolla, California. The hotel is portrayed in the recent film J. Edgar as the getaway for Hoover and his lover. Texas oil barrons, movie stars and politicians mingled at the hotel out of sight of prying journalists.
Murchison also printed Hoover’s book, Masters of Deceipt. But the biggest connection between Hoover and Texas oil was not disclosed until after Hoover’s death. Murchison got Hoover involved in lucrative oil deals. If the deals were unsuccessful Murchison covered Hoover’s losses. (The Big Rich, Bryan Burrough, Penguin Books 2009 pages 227-228).
Bribing public officials was nothing new for the Texans. Historians have argued that oil millionaires acquired land next to Eisenhower’s small farm and permitted him to acquire the land for next to nothing. As a result the farm, acquired for $24,000 became worth over a million dollars. In exchange, Eisenhower agreed to appoint Murchison’s man, Robert Anderson, as Secretary of the Treasury. Anderson was immediately appointed to a cabinet committee to study” the oil import situation. The investigation led to present-day programs favoring the oil industry. Anderson in turn received almost a million dollars of Texas-Louisiana oil property. (Endless Enemies by Jonathan Kwitny).
The associations proved handy after Kennedy was assassinated. Many people whispered about possible Texas involvement in the killing. Investigators probed possible connections between oil baron H.L. Hunt and Jack Ruby. In December, 1963 the FBI interviewed members of the Hunt family regarding their possible involvement. Hunt’s contacts with the FBI enabled him to receive detailed communications on the progress of the Warren Commission investigation. (The Big Rich, Bryan Burrough, Penguin Books 2009 pages 308-309).
Although the full extent of the FBI/US Government/Texas relationship was not known at the time, the American public was suspicious. Books and movies: The Radical Right and the Murder Of John F Kennedy by Harrison Livingston, The Texas Connection by Craig Zerbel and Blood, Money & Power by Barr McClellan all focused on the possibility of Texas’ hand in the plot. Movies embellished the theory: Executive Action in 1973, JFK by Oliver Stone in 1991. Despite all the print and movie time devoted to the theory, it was not investigated by the government to any serious degree.
The theory was revived in 2011 when Jackie Kennedy’s taped 1964 interviews were finally released. She indicated that she believed that Lyndon Johnson and a “cabal of Texas tycoons” had a hand in the assassination. dailymail.co.uk august 8, 2011.The tapes had been sealed in a vault in the Kennedy library in Boston. Mrs. Kennedy had ordered that they not be revealed until 50 years after her death in order to protect her family against recriminations.The tapes were released early by Mrs. Kennedy’s daughter, Caroline in an agreement meant to limit the distribution of an unflattering movie about the Kennedys.
Had the Warren Commission focused more on possible motives behind the assassination then on ratifying the FBI report; had their investigations proceeded without the influence of the FBI and its friends Gerald Ford and others, these theories might have died a natural death or been verified by evidence that would have been available at the time. Instead, conspiracy buffs must rely on tardily-disclosed and partially-destroyed records (FBI contact with Oswald, Hoover deals with Texas oil).
And, of course, the events taking place in the world at the time that would have provided a basis for such a dramatic and dangerous step, and subsequent events, like ripples on a lake, that hint of something happening beneath the surface.
Next – the 1960’s: Texas and the Middle East
The FBI released a 500-page report concluding that Lee Harvey Oswald acted alone on December 9, 1963, only 17 days after the assassination. The speed with which the report was prepared is amazing. Five hundred pages in seventeen days? Starting from scratch? On a matter of most critical national importance? In the days before computers and electric typewriters?
Notwithstanding this conclusion, and the obvious interest the FBI would have in protecting its reputation and the integrity of its report, the FBI was appointed as the chief investigative body for the Warren Commission. Indeed, the the Commission’s primary goal appears to be to ratify the FBI report.
The FBI had much to protect. There were frequent contacts between FBI representatives and Oswald, even while Oswald was in Russia. These contacts, and the FBI’s failure to come clean about its relationship with Oswald, are detailed in the Select Committee Report. At minimum, the FBI’s failure to identify Oswald as a risk to the President (especially after learning of his presence in Dallas at the time of the Kennedy visit) was akin to the security failures leading up to September 11. At its worst, the FBI/Oswald contacts could be construed in a more sinister light – as an effort to cover up involvement in the assassination.
Lyndon Johnson and J. Edgar Hoover had a nineteen-year friendship. Hoover’s relationship with Kennedy ranged between cold formality and enmity.
President Johnson and J. Edgar Hoover discussed the creation of the Warren Commission and its potential membership. Listen to their conversation:
After the Commission was formed, the FBI obtained confidential back channel information on its progress from one of the Commission members – Gerald Ford. Ford reported to Assistant FBI director Cartha DeLoach, beginning three weeks after his appointment to the Commission.
A Washington Post article in August, 2008 discusses newly-released information regarding the extent to which Ford reported on the status of efforts to convince the Commission members to ratify the FBI conclusions and identified skeptics.
What would motivate Ford, a Republican Congressman, to behave in this way?