Part 3 Memoirs David Rockefeller... Learning From the Great Economists ... A Dissertation, A Wife, and a Job ... The War

Memoirs 

David Rockefeller

CHAPTER 7 

LEARNING FROM THE GREAT ECONOMISTS 

In mid-September 1936, Dick Gilder and I attended the Republican Convention in Cleveland and watched the nomination of Governor Alfred Landon of Kansas as the forlorn hope to run against the immensely popular President Franklin D. Roosevelt. My family had supported the Republican Party since the 1850s—Grandfather told me that he had voted for Abraham Lincoln in 1860—and I considered myself a Republican as well. The party regulars were pessimistic about their chances and deeply divided between the progressives, who opposed the New Deal but saw a necessary role for government in the economic life of the country, and the conservatives, who were convinced that the United States was undergoing a Bolshevik revolution and wanted to return to the laissez-faire world of the nineteenth century. 

With the convention over, Dick and I returned to Cambridge and reoccupied our old suite of rooms in Eliot House. Dick entered Harvard Business School, and I, with some trepidation, began the demanding course of graduate study in economics. 

SCHUMPETER AND KEYNES 

I soon knew I had made the right decision. I began graduate work just as John Maynard Keynes’s controversial ideas on state intervention to stimulate economic activity provoked an explosive debate within the profession and more broadly. 

I was most influenced that year by Joseph A. Schumpeter. In fact, one of the intellectual high points of my graduate work was his basic course in economic theory. Schumpeter was already considered one of the world’s premier economists. He had been active in politics in Austria and had served briefly as minister of finance in 1919. He had also run a private bank in Vienna for a time in the 1920s. He arrived at Harvard in 1932 and was in his mid-fifties when I met him in the fall of 1936. 

Schumpeter was most interested in the entrepreneur’s role in the process of economic development, and by the mid-1930s he had emerged as one of the principal champions of the neoclassical economic tradition. But he was not a simple defender of the old order. He agreed with Keynes that something had to be done to deal with the unprecedented levels of unemployment of the Depression and the political and social instability it had produced. However, he rejected the central element of Keynes’s theory that without government intervention the capitalist economy is vulnerable to prolonged periods of massive unemployment and reduced levels of economic activity. 

Schumpeter feared that Keynesianism would permanently substitute government control for the normal and healthy operations of the marketplace. He was quite alarmed at the impact these “unorthodox” ideas were already having on the fiscal, tax, and monetary policies of a number of Western countries, including the United States. 

Fit, trim, and aristocratic in bearing, Schumpeter had driven horses competitively when he was younger. He was also a great admirer of the female sex and was rumored to have had many elegant amours. He once said in class that he had three goals in life: to become the greatest economist, the greatest lover, and the greatest horseman of his generation, but felt he had not yet fulfilled his ambitions—at least in respect to horses! Unlike most Harvard professors he dressed stylishly in well-tailored suits, with a silk handkerchief jutting out of his jacket pocket. Arriving in class with an air of being in a great hurry, he would throw his overcoat on a chair, whip his handkerchief from his pocket, flip it out toward the room, then fold it and carefully mop his brow and the top of his balding head before saying, in his heavy German accent, “Ladies and gentlemen, let us begin.” 

Paul Samuelson, who has since become a renowned economist in his own right, was also in Schumpeter’s class that term. Paul already had a master’s degree in economics and was a superb mathematician as well. Since economics was already becoming reliant on mathematical analysis, Schumpeter would often call on him to go to the blackboard and write P out complex economic formulas, which I usually didn’t understand. I had entered the graduate program with little knowledge of calculus, which had already become critical to economic analysis. Although I had written my senior thesis on a subject bordering on economics, I had taken only two rudimentary economics courses as an undergraduate and had a lot of catching up to do. 

Paul’s formidable knowledge of economics made me all the more self conscious about my own modest background. However, at the end of the first term I remember going to the bulletin board outside the classroom to check our posted grades. To my great surprise and delight I got an A-, a much better grade than I had expected. I was standing there feeling thrilled with myself when Paul arrived. He had received a solid A. He also looked quite pleased until he saw my grade, listed just above his. His face fell immediately. Clearly his grade lost significance if a novice like me could get an A−. 

HABERLER AND MASON 

Professor Gottfried von Haberler’s course on international trade also influenced me greatly. A charming man with courteous European manners, Professor von Haberler had just arrived on campus that fall with a reputation as a staunch defender of free trade. His ideas were ignored in the 1930s when nations around the world gave in to the siren song of protectionism, but they would have a great impact after World War II when international trade expanded and world economic growth surged dramatically. 

Professor Edward S. Mason’s equally interesting course covered the nascent area of international economic development. Mason emphasized the technical inputs needed to stimulate broader economic growth in what we would later call the “underdeveloped world.” His pioneering work would make him one of the leading proponents of foreign economic assistance in the years after World War II, a subject that would engage me deeply as I became involved with Latin America and Africa later in my career. 

The courses with Schumpeter, Haberler, and Mason provided me with a superb introduction to the study of economics and a solid grounding in S economic theory as it was evolving during that critical period. I also discovered that I enjoyed the subject and maybe even had a flair for it. 

THE LONDON SCHOOL OF ECONOMICS 

Since my first year of graduate study had gone well, I decided to go on to the London School of Economics and Political Science, commonly known as the LSE. Fortunately, I found a genial companion to share the adventure. In the course of my graduate year at Harvard I became acquainted with Bill Waters, a fellow resident of Eliot House whose father ran a manufacturing company in Minneapolis. I discovered that Bill also planned to spend the following year at LSE. We struck up a friendship and decided to room together in London. 

The night before we sailed from New York in late September 1937, several friends gave us a farewell dinner at Giovanni’s Restaurant. Our hosts included Benjy Franklin, Dick Gilder, and also Margaret (Peggy) McGrath, the young lady whose company I had long enjoyed but still just considered a good friend. Bill sat next to Peggy at dinner and was greatly taken by her. After we settled into our stateroom on the S.S. Britannic, he said, “What are you waiting for? Why don’t you marry Peggy?” I was more than a bit taken aback, but somehow the suggestion struck a responsive chord. I wrote to Peggy once I arrived in London and to my delight had a prompt response. From this modest start was born a relationship that meant everything to me for the next six decades. 

My father’s connections with the LSE (both the Laura Spelman Rockefeller Memorial and the Rockefeller Foundation had provided sizable grants over the years) helped solve the problem of housing in London. Father knew Sir William Beveridge, the director of the LSE, who was retiring to become master of University College, Oxford. Sir William, to whom I had written at Father’s suggestion, offered to lease us his flat in Elm Court in the Middle Temple, one of the famous Inns of Court nestled just within the ancient walls of the City of London between Blackfriars Bridge and Fleet Street. 

This was a rare opportunity for us, to live in the heart of London only ten minutes’ walk from the LSE and in one of the few Elizabethan buildings that had survived the Great Fire of London in 1666. The flat I was quite small, but there were two bedrooms, a dining room, living room, and kitchen. Best of all, Sir William left us his laundress, Leily, who agreed to cook for us and take care of our rooms. In fact, she did everything for us except wash our clothes! Leily was an absolute gem, and her presence allowed Bill and me to entertain guests and live very comfortably. 

Unfortunately, my close connection with Sir William made life more difficult for me in some ways. As I wrote to my parents, Sir William “definitely belongs to a regime that is past and which is none too well liked by the great majority of the staff. . . . Most of the trouble seems to rise out of petty jealousies and school politics. The fact nevertheless remains that I am looked upon a bit skeptically by virtue of being such a good friend.” 

It was not the last time that I would encounter suspicion because of the privileged or controversial company I kept. 

HAROLD LASKI: PIED PIPER OF THE LEFT 

In those days the LSE was widely considered a hotbed of socialism and radicalism. Founded by the Webbs in the 1890s to help achieve their Fabian Socialist goal of a just society based on a more equal distribution of wealth, its walls had always given shelter to men and women who tested the limits of orthodoxy. During the 1920s and 1930s its reputation owed much to Harold Laski, a very popular political science professor who enthralled well-filled classrooms with his eloquent Marxist rhetoric. 

Laski dominated the teaching of government and sociology at the LSE for three decades and was by far the most flamboyant and controversial figure at the school. In person, Laski was a small, sharp-faced man with a powerful and aggressive intellect; in his lectures he spoke in full paragraphs, the final word or phrase of which drew his thoughts together with a sudden and startling clarity. Although Laski was enormously popular with the student body, I found the intellectual content of his lectures superficial and often devious and misleading. They seemed more propaganda than pedagogy; he was indeed a pied piper. 

I had one personal experience with Laski that revealed something of  his true character. Before I went to London, William E. Hocking, a professor of religion at Harvard, gave me a letter of introduction to Laski. The two had met when Laski taught at Harvard from 1916 to 1920. During the infamous Boston Police Strike of 1919, Laski sided with the striking police and denounced the authorities, including Governor Calvin Coolidge. Laski became persona non grata at Harvard; people refused to speak to him when they passed him on the street. Hocking befriended Laski and took him into his home during the most difficult period. Though Hocking had no sympathy for Laski’s political opinions, he apparently thought they had become friends.

When I presented Hocking’s letter to Laski, he scanned it briefly, threw it aside, looked up with a bored expression on his face, and said, “I have no more use for Hocking.” I was appalled! I wrote Father a letter in which I didn’t mention the incident—I think in a curious way I found it almost embarrassing—but I did observe that Laski’s radicalism appeared to come more from “envy of those who are more successful than pity for those who are less well off.” 

Laski, who saw the state as “the fundamental instrument of society,” was particularly influential with students from India, who flocked to his classes and seemed bewitched by his rhetoric. In the judgment of many, Laski had a greater influence on India’s and Pakistan’s economic and political policy when those British colonies achieved independence after World War II than any other individual. India’s dominant Congress Party, for instance, was largely controlled by people who had learned socialism at his feet, and his ideology exerted a powerful influence for many years. 

HAYEK AND ROBBINS 

The economists at LSE were much more conservative than the rest of the faculty. In fact, its economists comprised the major center of opposition in England to Keynes and his Cambridge School of interventionist economics. 

My tutor that year was Friedrich von Hayek, the noted Austrian economist who in 1974 would receive the Nobel Prize for the work he had done in the 1920s and 1930s on money, the business cycle, and capital theory. Like Schumpeter, Hayek placed his trust in the market, believing that over time, even with its many imperfections, it provided the most reliable means to distribute resources efficiently and to ensure sound economic growth. Hayek also believed that government should play a critical role as the rule maker and umpire and guarantor of a just and equitable social order, rather than the owner of economic resources or the arbiter of markets. 

Hayek was in his late thirties when I first met him. Indisputably brilliant, he lacked Schumpeter’s spark and charisma. He was a dull lecturer, very Germanic and methodical. His writings were ponderous and almost impossible to read—or at least stay awake while reading. Nevertheless, I found myself largely in agreement with his basic economic philosophy. Personally, he was a kindly man whom I respected greatly. On more than one occasion I remember his taking from his wallet a crumpled, dog-eared paper on which he had written a list of the remaining “liberal economists.” He would look at it sadly and sigh. He was convinced that the list was shrinking rapidly as the older believers in the free market died off and most of the newer economists followed the new Keynesian fashions. I feel sure that Hayek, who died in 1992 at the age of ninety-three, felt greatly reassured by the resurgence in support for the market among the majority of economists and many political leaders in the 1980s. Unfortunately, I never had a chance to discuss this with him or to find out if he had made up a new and longer list! 

My favorite teacher at the LSE was Lionel Robbins, later to become Baron Robbins of Clare Market, who took over as head of the economics department the year I arrived. At that stage of his career Robbins was a firm advocate of the market and dedicated opponent of government intervention. But he was much less dogmatic and more eclectic than most of the other neoclassical economists I met during this time. He stressed logic and sound reasoning over the new fashion of econometrics. He would often say that one should make a distinction between what actually happens in the real economy and what we might wish to happen. 

Robbins clashed with both Laski and Keynes during the 1930s over a number of key political and economic issues. Robbins and Keynes first tangled in 1931 while serving on a government advisory committee B examining the problem of unemployment. Keynes pushed his demand side ideas—public works, tax cuts, and deficit spending—which Robbins successfully opposed. Later, though, Robbins joined the ranks of those favoring an increased role for the state in the management of economic life, calling his earlier disagreement with Keynes “the greatest mistake of my professional career.” 

Robbins wrote and spoke English with great elegance and style. After the war his interest in the arts began to take precedence over economics, and he became chairman of the National Gallery and a director of the Royal Opera. Lionel was one of the most broad-gauged and cultivated men I have ever known, and I valued his friendship until his death in 1984. 

SOCIALIZING WITH THE KENNEDYS 

Bill and I had a varied and pleasant year. We met a number of interesting people and learned a great deal about the country and its people. Bill was a delightful companion, and we spent weekends bicycling in the countryside, playing golf, or visiting new friends at their country homes. On a few occasions we went to Oxford or Cambridge to see Harvard friends who were also studying in England. On one trip to Cambridge we saw John Kenneth Galbraith and his wife, Kitty. I had known Ken at Harvard when he was a young instructor in agricultural economics. Ken was a great admirer of Lord Keynes and had gone to Cambridge specifically to study under the great man. Although we had sharply divergent views on economics and politics, that never prevented us from maintaining a cordial personal relationship through the years. 

On one occasion Randolph Churchill, Winston Churchill’s son, then writing for The Evening Standard, came to interview the “Rockefeller” who had come to study in England, and the next day his column revealed that I was in the country to find myself an English bride. The story was reprinted throughout the British Empire. Within a few weeks I was inundated with marriage proposals, many accompanied by photographs, from scores of prospective brides from as far away as Nigeria. 

Halfway through the year Joseph P. Kennedy arrived with his wife and  a number of his children to take up his post as ambassador to the Court of Saint James. Within a relatively short time Kennedy would become very unpopular in Britain, first for his allegedly pro-Nazi sympathies and then for opposing U.S. aid to Britain and France after the outbreak of war. But in early 1938 that was all in the future, and he was liked and respected by the British political and financial establishment. 

The Ambassador quickly became a fixture on the London social scene, photographed often in nightclubs and at gala parties in Kensington. He and Mrs. Kennedy also entertained lavishly at the American embassy. They gave an extravagant dance to introduce their daughter Kathleen to British society, to which I was invited. It was there that I first met John F. Kennedy, who had come over from Harvard especially for the party. Although we were contemporaries at Harvard, we had never met before. Jack was an attractive, sociable young man, slight in build with an unruly shock of dark red hair. He seemed eager to get my impressions of the political situation in Great Britain. 

Kathleen was pretty, vivacious, and a great success in London. She later married William Cavendish, Marquess of Hartington, but that year she was uncommitted, and I enjoyed her company on a number of occasions. Tragically, the Marquess was killed during the Normandy Invasion, and Kathleen died in an air crash in 1948. 

PEDRO BELTRÁN: FUTURE PERUVIAN PRIME MINISTER 

I made a number of enduring friends during that year in London, but the most impressive was Pedro Gerado Beltrán, a man almost twenty years my senior. Pedro came from a prominent Peruvian landholding family and was the owner and publisher of the influential Lima newspaper La Prensa. He had taken a degree in economics from the LSE twenty years earlier and had served as head of the Peruvian central bank by the time I met him. Pedro was in England to take care of family business interests, but he was an intellectual at heart and spent several days a week at the LSE sitting in on economics courses that interested him. A charming, urbane bachelor, he introduced me to some quite beautiful women I probably would not have met otherwise. 

Pedro was such an impressive man that I gave him a letter of introduction to my brother Nelson, who had started to develop a keen interest in Latin America. This proved to be serendipitous a few years later when President Roosevelt appointed Nelson Coordinator of the Office of Inter-American Affairs and Pedro became Peruvian ambassador to the United States. 

REVISITING THE THIRD REICH 

During the Christmas 1937 recess, Bill and I traveled to Germany. I remember particularly the “wool” clothing made out of wood pulp; the real wool, I suppose, had been commandeered by the military. 

In Munich we witnessed the massive funeral procession for General Erich Ludendorff, the virtual leader of the German army during World War I and Hitler’s compatriot in the Beer Hall Putsch of 1923. The largest crowd I had ever seen jammed the Ludwigstrasse, Munich’s main boulevard. Fully armed SS troops, standing rigidly at attention, lined both sides of the street. As Bill and I pushed up to the front, the funeral cortege began to pass with Hitler at the head of columns of goosestepping soldiers. I snapped his picture with my Leica camera as he swaggered past acknowledging the stiff-armed Nazi salutes and the thunderous cries of “Sieg Heil.” I had never seen anything like the frenzied adulation of that crowd or experienced such an overpowering sense of discomfort at what that adulation represented. 

After this chilling encounter I spent the rest of the holidays in Frankfurt with a close Harvard friend, Ernst Teves, and his father, a prominent German industrialist. We attended a number of parties, including an elaborate costume ball where the Frankfurt socialites seemed almost frantically bent on having a good time. From my conversations I learned that many people believed Hitler’s aggressive demands for the return of German territory would lead inevitably to war, although no one wanted to protest. It also appeared to me that the growing regimentation of daily life, the menacing Nazi ideology, and the flagrant persecution of Jews and others had produced a strong undercurrent of fear and anxiety. People seemed to be afraid of saying or doing the wrong thing. “Heil Hitler!” was the mandatory greeting for everyone. Swastikas were everywhere, and people deferred obsequiously to Nazi party officials whenever they encountered them. The gaiety of the parties I attended seemed forced and hollow. I returned to England feeling depressed about the future. 

THE DALMATIAN COAST AND GREECE 

During our Easter holiday in 1938, Bill and I joined three Harvard friends for a trip down the Adriatic. We took all of the passenger accommodations on an Italian freighter sailing from Venice. The cabins were small but clean and comfortable, and the food surprisingly good, considering that the entire five-day voyage cost each of us five pounds (then $25), everything included! We stayed for a few hours each in Trieste, Zara, Split, and Dubrovnik in Yugoslavia and Durazzo in Albania, and ended the trip in Bari, Italy. 

We flew from Bari to Athens where we rented a car and drove through the Peloponnesus to Sparta and Mount Parnassus and then back along the Gulf of Corinth to Delphi. While having a drink at the bar of the Grand Bretagne Hotel in Athens, I ran into Professor Kirsopp Lake, who was famous for his popular course on the Bible at Harvard. He asked me to go with him, his wife, and stepdaughter, Silvia Neu, to Salonika by overnight boat. From there he and I would take a smaller boat to the peninsula of Mount Athos, where he would be looking for manuscripts in the libraries of orthodox monasteries. The invitation was too tempting to turn down. 

Silvia Neu turned out to be a very agreeable companion on the boat trip, and the three days on Mount Athos were unforgettable. We stayed each night at a different monastery as the guests of the monks, many of whom Professor Lake knew from earlier trips. The monasteries, built during the Middle Ages, are perched on the slopes of Mount Athos, with the incredibly blue Aegean spread out below. At night the stillness was broken by the hauntingly beautiful chanting of the monks, and the air was thick with incense. To my disappointment, because I found Silvia quite appealing, the monasteries were exclusively male; females— human, animal, or otherwise—were strictly forbidden. As an entomologist, however, I was amused to discover a number of copulating beetles. 

I had expected to spend several days in Rome with Ambassador William Phillips and his attractive daughter, Beatrice, but that part of the trip had to be cut short because of my trip with Professor Lake. My plane from Salonika to Rome stopped unexpectedly in Tirana, Albania, where I found there were no hotel rooms available. By good chance I ran into an entomologist working for the Rockefeller Foundation on a malaria eradication program, and he offered to share his small house with me for the night. It had been a memorable vacation. 

THE UNIVERSITY OF CHICAGO 

After a year in London I was eager to return to the United States to complete my graduate work at the University of Chicago, which boasted one of the premier economics faculties in the world, including such luminaries as Frank Knight, Jacob Viner, George Stigler, Henry Schultz, and Paul Douglas. I had heard Knight lecture at the LSE and found his more philosophical approach to economics quite compelling. Lionel Robbins knew Knight well and urged me to study with him. The fact that Grandfather had helped found the university played a distinctly secondary role in my choice. 

The Chicago “school of economics” has gained a great deal of fame and not a little notoriety over the past fifty years for its unwavering advocacy of the market and strong support for monetarism. These ideas are intimately associated with Milton Friedman, whose views have now come to symbolize a Chicago School that is strongly doctrinaire in its insistence that government should not interfere at all with the market and the natural pricing mechanism. Friedman also argues that business should concentrate exclusively on optimizing profits and should not be sidetracked by involvement in outside activities that are “socially responsible.” 

While Friedman later became an associate of Professors Knight and Viner on the economics faculty, I have no doubt they would have resisted being categorized as members of the Chicago School in the narrow present day meaning of the term. They both favored the  “invisible hand of the market” over government intervention as the best means to sustain economic growth, but I believe they would have objected to Friedman’s cavalier dismissal of corporate social responsibility. 

KNIGHT, VINER, AND LANGE 

When I arrived in Chicago in the fall of 1938, I was able to persuade Professors Knight and Viner to become members of my thesis committee. Oskar Lange, a refugee scholar from Poland, also agreed to serve on the committee. I already had a general idea for a dissertation topic—Professor Hayek had suggested the idea of economic waste to me in London—but I sought the help of these distinguished economists to help me formulate a more specific proposal. 

Frank Knight occupies a revered position among the world’s economists. His best-known book, Risk, Uncertainty and Profit, is unusual in its insistence that ethical considerations had to be incorporated in the process of economic analysis. His probing questions in books and lectures, testing the moral validity of economic dogma, produced many heated debates. 

Knight doubted the claims of New Deal planners that an increase in the coercive powers of government automatically leads to an increase in people’s well-being and happiness. At the same time Knight criticized those who talked only of the efficiencies of capitalism without recognizing the moral issues involved and the obvious failures of the existing system to address important social problems. 

Jacob Viner was best known for his theoretical work on international trade. Like Haberler at Harvard, Viner advocated unobstructed trade as a means of generating economic growth. As a teacher Viner was known for his tough and demanding manner in the classroom. Logical and incisive himself, he was intolerant of students who did not meet his standards. He was famous for throwing them out of class if they failed two or three times in a row to come up with the correct response. He’d simply say, “You’re not up to this class. Good-bye,” and that would be it. With me, however, he was always friendly and willing to be helpful when I consulted him on my thesis. Perhaps it was fortunate for me that I was T simply his advisee, not in one of his regular graduate seminars. 

Oskar Lange was less renowned as an economist than either Knight or Viner, but he added a different and important perspective to my thesis. Lange was a Socialist and a leading exponent of market socialism. His book The Economic Theory of Socialism purported to demonstrate that “market socialism” was not a contradiction in terms and could be much more efficient than laissez-faire capitalism. Clearly, this notion has never been demonstrated in real life, but Lange carried off his argument with elegance. 

Lange was one of a large group of émigré scholars who came to the United States with the assistance of the Rockefeller Foundation during the 1930s, fleeing political and religious persecution in Europe. Chicago hired Lange because of his capability in mathematical statistics and knowledge of Keynesian economics, and he became an American citizen in 1942. 

After the war Lange resumed his Polish citizenship and became ambassador to the United Nations. He later filled a number of posts in the Polish government, which by then was increasingly dominated by Communists. Lange was a kind, gentle, and eminently likable man, not a demagogue like Laski. I believe he returned to Poland more out of a sense of patriotic duty than because he was a committed Marxist. I saw Lange several times at the U.N. after the war, and it was clear he was a torn and unhappy man. 

LIFE ALONG THE MIDWAY 

The university contained a fascinating mixture of individuals, many with strong personalities and convictions, beginning with the head of the university. Robert Maynard Hutchins dominated the university and consistently outraged the city’s business establishment. Known as the “boy wonder,” Hutchins had resigned his position as dean of the Yale Law School to accept the presidency of Chicago at the age of twentynine. He quickly threw the campus into turmoil by abolishing football and restructuring the undergraduate degree program. Hutchins favored a broad-gauged liberal arts education for undergraduates focused on the “Great Books” program developed by his friend, the Thomist philosopher Mortimer Adler. 

Hutchins’s reforms alienated many of the faculty, who were also put off by his arrogance and dictatorial ways. Hutchins also fought an ongoing series of battles with Chicago businessmen and politicians, of whom he was contemptuous, viewing them as limited in their vision and parochial in their interests. Mrs. Hutchins was of little help. An artist with severe psychological problems, she refused to support her husband in any way. She also raised eyebrows and started tongues wagging by sending out as a Christmas card in 1938 her drawing of their nude daughter. 

Despite my family’s role in creating the university and sustaining it during its early years, Hutchins never invited me to a function at his home during the year I lived there. However, I suspect Hutchins may have encouraged his vice president, William B. Benton, one of the founding partners of the advertising firm of Benton & Bowles, to spend some time with me. Benton introduced me to a number of interesting people, including Beardsley Ruml, the enormous cigar-smoking Hungarian who had been a close advisor to my father during the years that he ran the Laura Spelman Rockefeller Memorial, the foundation that helped underwrite the development of the social sciences in many American universities. Ruml, like my father, had been a strong supporter of government reform efforts, not just by eliminating corruption and graft but by strengthening the civil service and improving the management of municipal and state governments. 

Ruml put me in touch with the Public Administration Clearing House in Chicago, which had received substantial funds from the Spelman Fund (yet another family philanthropic foundation). It was through that organization that I began to understand the important role government at all levels should play and considered government service as a possible career path. 

Benton also arranged for me to see Philip La Follette, the governor of Wisconsin, to discuss whether I should enter politics. La Follette’s advice was that I could never get elected to public office with my name—unless I bought a farm in the Midwest and established a new life and image. That ended my thoughts of a political career. I could not imagine being so hypocritical as to pretend to be something I was not. It would be a subterfuge that people would quickly see through. 

At the social functions I attended during that year in Chicago, I often felt uncomfortable because many of the other guests were slavish followers of the isolationist line trumpeted daily by Colonel Robert R. McCormick’s Chicago Tribune and were outspoken “America Firsters,” actively hostile to any involvement with the rest of the world. A famous America First rally was held during the summer of 1939 at Soldiers Field, and I recall the roar of approval from the crowd as it cheered the speech of my childhood hero, Charles Lindbergh, who had become the standard-bearer of the isolationist cause. 

My year in Chicago was productive intellectually, but I longed to return to a more congenial environment. Since I had completed my required year of residency and passed my general qualifying exams (not an easy task with fifteen economists peppering me for three hours with searching and very technical questions), I decided to write my dissertation back in New York at Kykuit. 

I had another and much more important reason to do this: Peggy McGrath. I had been courting her much more seriously since my return from London and wanted to be closer to her, hoping our relationship would continue to grow.

I owe a great intellectual debt to the remarkable economists with whom I studied. My mentors were truth seekers who believed that economics could shed light on an important aspect of human behavior and thereby help improve society. They were all political moderates who were willing to listen to reason regardless of where they found it. I like to think I have followed their example. I am a pragmatist who recognizes the need for sound fiscal and monetary policies to achieve optimum economic growth. I recognize, however, that otherwise sound policies that ignore real human needs are not acceptable and that safety nets have an essential place in our society. However, my greatest concern is that the pendulum has swung too far in the direction of unaffordable safety nets with too little attention given to sound policies that will stimulate economic growth.

CHAPTER 8 

A DISSERTATION, A WIFE, AND A JOB 

My return to New York coincided almost exactly with the outbreak of World War II. In the end, the Anglo-French policy of appeasement had failed to mollify Hitler or to deflect him from his goal of creating a Greater Reich and making Germany paramount once again in Europe. I read the newspaper accounts and listened to the radio reports with mounting dread as the irresistible blitzkrieg overwhelmed Poland. It was a new kind of warfare, and I wondered what the future held in store for me and my many friends in Germany, France, and Great Britain. 

My primary task that fall was completing my dissertation. I chose to live in Pocantico rather than in my parents’ home on Park Avenue to avoid the wonderful distractions with which New York City abounds. Living at Kykuit worked out well for me on several accounts, not least of which was my proximity to Peggy McGrath. My parents came out for weekends, but otherwise I was alone. I made the sitting room next to what had been Grandfather’s bedroom into my study. During meals I played rolls of music on the pipe organ, which worked just like a player piano. I especially liked the arias from Madame Butterfly and Tristan und Isolde. Whenever I needed a break from the rigors of intellectual inquiry or the “terror of the blank page,” I could play golf, ride horseback, go for a swim in the Playhouse, or walk in the woods overlooking the Hudson. Actually, it was a pleasant existence. 

I began work on my dissertation with some trepidation since I had never been involved in a project that required such concentrated research, thinking, and writing. Moreover, I was totally on my own with no professors to turn to for guidance. I was painfully aware that I had to produce a document demonstrating original thinking on a subject of M economic significance. 

“REFLECTING” ON IDLENESS AND WASTE 

My subject, “Unused Resources and Economic Waste,” dealt with one aspect of a much wider issue: whether to rely principally on market forces or governmental intervention to correct the extraordinary levels of unemployment and the underutilization of industrial capacity that had characterized the era of the Great Depression. Hayek and the neoclassical economists placed their faith in market forces, while Keynes and many others argued that only government intervention, including deficit financing or “pump priming,” along with fundamental economic restructuring could return the United States and other advanced economies to full employment and prosperity. 

The narrower aspect of the contentious debate that I examined was industrial plant utilization, a question that had received little attention from economists until the 1930s. By then large industrial firms— automobile plants, steel mills, and the like—employing thousands of workers dominated the American economic landscape. As a result of the Depression many of these plants were idle or operating at only a fraction of their capacity. To many this situation was wasteful in the sense that factories were not being used while enormous numbers of people were without jobs and in great personal distress. Many argued that pumping government funds into the economy through the construction of public works or direct relief payments to the unemployed would raise the level of national income and stimulate activity in the private sector, which in turn would utilize idle capacity and increase employment. The specific issue I addressed was whether idle plant capacity was wasteful in the sense that many economists were asserting. 

Both Hoover and Roosevelt had inadvertently pumped money into the economy through annual budgetary deficits. Even though conditions slowly improved over the course of the 1930s, there remained a large and seemingly permanent body of unemployed in the country, and a significant percentage of the industrial plants remained idle. Economists sought the cause for this situation and offered a wide array of remedies. I felt that many of the studies had failed to define their terms accurately, and their conclusions might be used to justify inappropriate and unwise fiscal and regulatory policies. 

For instance, the Brookings Institution published a series of analytical studies in the mid-1930s that supported the case for permanent government intervention. One volume argued that “underconsumption is a permanent malady, inherent in the present form of industrial organization,” and that the failure to fully employ all resources was not only wasteful but an inevitable part of our economic system. The solution proposed was a permanent program of public works, the easing of restrictions on lending and credit, and a greater role for government in the planning of economic production. 

More telling, I thought, was the explanation for the failure to achieve the ideal of full and continuous use of plants—the “stupidity and lack of foresight of entrepreneurs.” Thus, if businessmen could not be trusted to plan intelligently, others had to assume the role. 

Statements like this led me to delve into the economic and moral meaning of waste and under what circumstances unused plants are in fact wasteful. I found that at the heart of these arguments was an unsound and fallacious premise that considered idleness and waste synonymous. In fact, they are not. For instance, it would be wasteful to reopen a factory if changes in taste and technology rather than insufficient demand had forced its closing. More important, most of these studies assumed that the primary reason for unused capacity or idle resources—and therefore of high unemployment and low income in both good times and bad—was the selfish decision of entrepreneurs and corporate managers to keep production low in order to obtain high prices and large profits. 

I found this argument preposterous. There are many reasons that a businessman decides not to use a portion of his available capacity: difficulty in purchasing materials, seasonal fluctuations, high taxes, excessive regulation, or even a failure to correctly read the market itself. If a factory is closed because of changed technology or consumer taste, it might be more wasteful to keep it running than to scrap it and build a new factory. 

I concluded that the failure to use an economic resource per se is not evidence of waste. In practical policy terms this means that citing the existence of idle factories as justification for interventionist government policies can lead to inappropriate actions and counterproductive results. On the other hand I also made it clear that in an extreme circumstance, such as an economic recession that severely reduced aggregate demand, pump priming was not only defensible but necessary. 

At the time my thinking about how and why businessmen made decisions had been molded to a large extent by the economists I had studied with, but in rereading my thesis today, it is clear that I was strongly influenced not only by Schumpeter, Hayek, and Knight, but also by my grandfather. 

In discussing the behavior of businessmen like him, I pointed out that those who believe the entrepreneur is motivated solely by the desire to “maximize profit” are mistaken. Clearly, the desire to make money is one important motivation, but there are others, often just as important. As I wrote in my dissertation: “Entrepreneurship offers at once an opportunity to satisfy man’s creative, his power-seeking, and his gambling instincts. . . . It would be misleadingly simple to ignore the fact that interest in the process of achievement is itself a goal to many who regard profit as a more-or-less worthwhile by-product.” 

In other words, part of the joy of business is achieving what one has set out to do, accomplishing goals that are important, and building something that has permanence and value beyond oneself. In addition to the profit motive and personal fulfillment, I argued that businessmen make decisions based on their assessment of their impact not only on their balance sheets and income statements but also on the needs of their workers and the broader community. 

Grandfather would have agreed with these propositions. The profit motive provides the discipline for achievement, but individual goals are formed by the larger society and only have meaning and value if they embrace and mirror the needs and objectives of the broader society. I have tried to put these principles into action during my own business career. 

I devoted about six months of nearly full-time effort to the project and finished the dissertation in April 1940. I can still remember placing the finished manuscript in envelopes and mailing them off to Professors Knight, Viner, and Lange. I was anxious, as every author is, about my readers’ reactions, but I was convinced that I had done a good and thorough job. My committee agreed, and four months later I received my T doctorate. 

PEGGY 

That fall and winter were not devoted solely to intellectual hard labor. Courting Peggy McGrath provided me with a very pleasant diversion and eventually with the most important relationship of my life. 

Peggy and I had known each other for years, but we had started to see one another more frequently and seriously only after I returned from London. Her father, Sims McGrath, was a partner with Cadwallader, Wickersham and Taft, a prominent Wall Street law firm. Her mother, Neva van Zandt Smith, was the daughter of a former president of the Pennsylvania Railroad. The McGraths had suffered financial losses during the Depression but lived comfortably in an attractive, white colonial-style house on “The Narrows” Road in Mount Kisco, exactly twenty-two minutes’ drive from Kykuit. That route became well worn during the winter of 1939–40. 

Peggy preferred the quieter life in Westchester County. She adored her horse, Soldier, whom she cared for herself and trained to jump and foxhunt. She had many friends in and around Mount Kisco and enjoyed dropping in on them unexpectedly during her rides, often staying for dinner. Peggy was full of fun and adventure, and was always the first to join in with something new and unconventional. 

Even as a child she enjoyed playing practical jokes. Old friends who attended the Rippowam School in Mount Kisco with her recalled the time that she and one or two others, including her sister, Eileen, placed a wedge of Limburger cheese behind a radiator on a wintry Friday afternoon before leaving for home. School officials had to cancel classes on Monday as they worked desperately to air out the building. 

Later, Peggy spent one year at the Shipley School, a rather stuffy girls finishing school outside of Philadelphia. She was known as Batty McGrath and delighted in skirting the regulations, especially the ones meant to keep the girls in their rooms in the evening. She had learned through careful observation the location of every creaky board in the building, a skill that allowed her to move about silently to visit her friends. 

I witnessed a number of Peggy’s practical jokes myself. One time she planted a device on the engine of Benjy Franklin’s beloved new car. When Benjy pressed the starter button, there was a loud bang and a huge cloud of smoke. Benjy jumped from the car with a look of horror on his face and searched frantically under the hood until he noticed the rest of us laughing hysterically. 

Peggy inherited her father’s strong sense of integrity and scrupulously adhered to a high moral standard. She inherited her mother’s excellent taste in many things, particularly the ability to select and wear attractive and flattering clothes, a talent made easier by her having an exceedingly good figure. 

While Peggy preferred life in the country to the social whirl of the city, she loved parties. In fact, we first met at a debutante party on Long Island in the early 1930s and often saw each other at dances and other parties during my college years. Both of us enjoyed waltzing, and this interest led to many enjoyable evenings together. The St. Regis Roof and the Rainbow Room were our favorite spots, and one evening we won a polka contest at the Rainbow Room. 

From the time I first met Peggy, I knew there was something different and compelling about her. I was not yet in love with her, but I found myself seeking her out more than other girls at parties. She had style, she was fun to talk with, and she was a great dancer. So when I returned to New York in the fall of 1939, my feelings changed significantly. I wanted to be with her as much as possible and found myself calling her on the phone several times a day. She often visited me at Kykuit. We listened to the player organ together or picnicked at some beautiful spot on the family property, where we would go on horseback. We took long walks together through the woods, talking for hours on end. A strong friendship turned into something much more passionate. 

By early spring I was thinking seriously about asking Peggy to marry me, but it was not until June that I actually got the courage. Peggy gave me the answer—twenty-four long hours later. 

When I told my mother—I had never mentioned the possibility to her before—she said dryly but with amusement, “Well, David, I’m not entirely surprised because I read the telephone bills, and there have been a great many calls to Mount Kisco.” 

In order to buy an engagement ring I drew out all my savings, about $4,000, which comprised my available resources at the time. Asking Peggy to marry me was the best decision I ever made. We spent fifty-five wonderful years together. There were rocky moments along the way, but our love deepened with each passing year. 

THE LITTLE FLOWER 

With my dissertation completed and my doctoral degree in hand, it was time to consider a career. I had no clear idea of what I wanted to do, but I knew that I had no interest in joining the Family Office where John, Nelson, and Laurance were already working. 

While I was in Chicago, Bill Benton and Beardsley Ruml told me about Anna Rosenberg, a labor and public relations advisor who had good contacts with important political leaders, including President Roosevelt, Governor Herbert Lehman of New York, and Mayor Fiorello La Guardia. Benton contacted Anna and told her of my interest in government service. After we met, Anna suggested that I take occasional days off from my dissertation to learn about different aspects of New York City’s government. She arranged visits to several City agencies, including a municipal lodging house and soup kitchen. On another occasion I spent the day sitting with a children’s court judge while he disposed of juvenile delinquency cases. 

These experiences piqued my interest in public service, and when Anna suggested I might enjoy working with Mayor La Guardia, I quickly agreed. Anna made the necessary arrangements, and on May 1, 1940, I reported to City Hall to begin working as a secretary to the mayor for “a dollar a year.” 

I was assigned a large office separated from the Mayor’s more resplendent chambers by a smaller room occupied by his two stenographers. My responsibilities took me in and out of La Guardia’s office a dozen times a day, and I sat in on many conferences and staff meetings, which often were both contentious and loud. I also drafted replies to the dozens of letters that came in every day. I dictated responses to a stenographer and sent them in to the Mayor for his signature. La Guardia seemed satisfied with my efforts, and more often than not he signed my suggested letters without making any changes. 

La Guardia, known as the Little Flower, had an explosive temper, though he could turn it on and off at will. He often turned it on. While sitting in my office answering correspondence or talking to a merchant in Brooklyn who was complaining about the lamppost in front of his store being too tall, I would suddenly hear him throw something down on the desk and yell to a trembling subordinate something like “You stupid SOB. How am I supposed to run a city with this kind of incompetence?” The rant would continue for several minutes, and a short while later I would see whoever had been the brunt of his rage slinking from the office. 

The commissioners who ran the departments of the City’s government were not spared this treatment, either. One of them, William Fellowes Morgan, Jr., the commissioner of markets, came from an old New York family and had accepted La Guardia’s job offer out of a sense of civic duty. However, whenever La Guardia received a complaint about Fellowes’s department, he would summon him into his office and berate him with the same foul language that he used with everyone. Poor Fellowes would just sit there cowering, practically shivering in a mixture of shame, anger, and fright. 

La Guardia was cruel to his secretaries as well. These women worked incredibly long hours and were completely devoted to him. But late in the afternoon, if the Mayor discovered a typo in a letter or some such thing, he would bawl them out unmercifully until they were reduced to tears. 

His negatives aside, La Guardia was an extremely impressive man and an extraordinary politician. He was certainly the best mayor New York City has seen in my lifetime—at least until Rudy Giuliani came along. One has to recognize that if La Guardia was impatient and hot-tempered, he had a lot to be impatient about: He was cleaning up a city whose government had become synonymous with corruption. A few years earlier the infamous James J. (Jimmy) Walker had allowed graft to reach new heights of flamboyance and artistry. Most City employees assumed they would be promoted only by paying off the proper person. Robbery, extortion, murder, and prostitution flourished while judges were paid to look the other way. 

La Guardia cleaned up New York through the force of his personality and the strength of his character. When he yelled at people, it was because of some festering corruption, inefficiency, or sloppiness. He drove himself hard and expected the same from the people around him. He didn’t hesitate to call people in the middle of the night to demand that something be ready for him by a certain time the next day. 

He was also a showman: His huge seven-passenger Chrysler limousine was equipped with flashing lights, siren, and a police radio to keep him informed about major accidents and fires around the City. When he heard about a fire, he would change course and race off to the scene, put on his fireman’s hat, and start giving orders. He was so colorful that the firemen didn’t mind, and the people of New York—and the newspapers —loved it. La Guardia could be heroic, too; he once helped rescue a firefighter pinned under a burning beam. He took an intensely personal interest in every aspect of the City—even on occasion flagging down speeding motorists and lecturing them on safe driving. 

The Chrysler was a movable office. Not uncommonly he would grab me as he left City Hall so that I could ride with him to edit his correspondence or to discuss a project of interest to him. We would spend the trip engrossed in business, and then he would jump out as we arrived at the next event on his schedule and with no preparation— sometimes I doubt he knew where he was going till he got there— deliver a speech perfectly tailored to his audience. And he was sincere, but not with the false sincerity that is the stock in trade of so many politicians. La Guardia was a believer, and it showed. 

I remember accompanying the Mayor to the opening of a new Sanitation Department facility somewhere in Brooklyn built with money provided by the federal government. The audience was the student body of a local grade school. I know for a fact that he had no idea he was going to be talking to children that day. But he launched into a description of, first, the value of the Works Progress Administration and its role in providing jobs during the Depression, and then of the Sanitation Department and its critical importance to the working of the City. From there he moved smoothly into a celebration of democracy, of which the Sanitation Department was clearly a vital element, and then of America itself. The children were spellbound. I’m sure all the sanitation workers felt like heroes. By the end of the speech I had tears in my eyes. It had all been impromptu, but it came from La Guardia’s heart and was enormously effective. 

The one commissioner who held his own with La Guardia was Robert Moses. Moses was a power in his own right. He had been a legislative aide to Al Smith when Smith was in the New York State Assembly and worked closely with him after Smith became governor in the 1920s. Moses was an intense man, the driving force behind the creation of New York’s impressive system of state parks, and a large part of its transportation system as well. Indeed, Moses remained a power in the City and the State for more than fifty years. During that time he held a variety of posts, but regardless of the titles, Moses was always a doer and a builder. There were few things related to the City’s infrastructure that did not go through one or another agency controlled by him. I would have firsthand experience with this after the war when I worked with him to redevelop both Morningside Heights and lower Manhattan. 

Moses was a Yale graduate, and unlike many politicians he was personally incorruptible. He was a dedicated public servant who demonstrated what well-designed and well-managed government programs could accomplish, but he could often be ruthless and autocratic in reaching his goals. 

Moses was a match for La Guardia in every way, in intellect as well as in sheer strength of character. He would casually say hello to me as he entered the Mayor’s office in a calm and gentlemanly manner. A few moments later I would hear the two of them start a shouting match that reverberated to the ends of the halls. But these arguments had a different outcome when Moses was involved; La Guardia respected him, and though he would get angry, he treated Moses as an equal and wouldn’t try to humiliate him the way he did others. 

During my year and a half with the Mayor, my biggest project was renting commercial space at La Guardia Airport, which had opened in 1939. The airport was the Mayor’s pride and joy, and he wanted it to be economically self-sustaining. The main terminal had been designed without the inclusion of rentable commercial space, an omission that made the Mayor’s goal difficult to achieve. William A. Delano, the architect, and I found areas where stores and display cases could be placed, and then I went out and leased the spaces. I turned out to be a pretty good salesman. Cartier took a small area at the head of a curved stairway for a jewelry counter, and I sold other space to a flower shop, a bank, a haberdashery, a brokerage office, and a beauty salon. 

Airplanes were still a novelty in 1940, and thousands of people visited the airport daily just to watch them land and take off. We installed an observation deck on an enclosed balcony overlooking the runways and charged a modest admission fee. The “Skywalk” was an immediate success and generated almost $100,000 a year in revenue. 

In late May 1940, a month after I began work, I was alone in the car with the Mayor and told him of my plans to marry. Assuming that Peggy accepted, I told the Mayor we would be married in the early fall and that I would like time off for a honeymoon. The Mayor expressed enthusiasm and wished me success. A few weeks later I told him that Peggy had accepted my proposal, and he took us out to dinner at the Tavern on the Green in Central Park and then to an open-air concert at City College’s Guggenheim Stadium to celebrate. He also agreed to give me time off for my honeymoon! 

Peggy and I married on September 7, 1940, in a charming little Episcopal church, Saint Matthew’s, in Bedford, New York. My brother John served as best man, and my other brothers and college roommates were ushers. The McGraths held the reception at their home, and there were more than two hundred guests, including Henry Ford, his son Edsel, and a number of older friends of both families. 

We honeymooned at the JY Ranch in the Grand Tetons, one of the most beautiful places in the world. We took a five-day pack trip through Yellowstone National Forest, where we each shot a bull elk. (In later years both of us lost our interest in hunting, but our love for wilderness pack trips continued unabated.) But mostly Peggy and I spent time with each other, enjoying the first experience of marriage and making plans for our future. It was a time that I still treasure in my heart. All too soon we had to return to New York.

“PREPAREDNESS” 

While I continued to work for La Guardia after my marriage, by the late summer of 1941, American entry into either the European war or a hostile confrontation with Japan became more and more of a possibility. Defense spending increased dramatically in mid-1940 after the fall of France, both to increase our own “preparedness” and to supply the British (and later the Russians) with armaments and other supplies. 

Government contracts for every imaginable item—from tanks to chocolate bars—stimulated the conversion of old factories to new uses and the construction of many new ones all across the country. The speed with which all of this was done spawned a number of unanticipated problems: inadequate medical facilities, nonexistent housing for war workers, strains on the local water and food supplies, and overwhelmed school districts. To cope with these and many other problems, the Roosevelt administration set up the Office of Defense, Health and Welfare Services (ODHWS), another of the hundreds of “alphabet agencies” that existed at the time. Regional offices were established across the United States, and Roosevelt asked Anna Rosenberg to head the New York region. 

Anna was a frequent visitor to City Hall, and one day she stopped in my office to say that perhaps the time had come for me to become involved with the “preparedness” effort and work with her as assistant regional director of ODHWS. The timing seemed good to me. I had enjoyed working for La Guardia and had learned a great deal about City government, but a year and a half seemed long enough. The job Anna offered me was salaried, and I felt it would give me the administrative experience that I never had with La Guardia. 

Anna assigned me responsibility for a large area of upstate New York. The companies opening factories there faced a number of problems, but employee housing was the most acute. At the tail end of the Depression, people were still willing to move long distances to find a good job, and the housing in many of the small cities and towns along the Saint Lawrence River and Canadian border—Watertown, Massena, and Ogdensburg—was inadequate to meet this large influx. I spent most of my time trying to mediate among impatient businessmen, harassed local officials, and the federal bureaucrats who controlled the funds needed to build the housing. I learned to negotiate and to cope with the unexpected on a daily basis. 

Less than three months after I took the job, the Japanese bombed Pearl Harbor. A new and very different chapter of my life was about to begin.

CHAPTER 9 

THE WAR 

It was a wintry afternoon in New York, and Peggy, Dick Gilder, and I were in a cab on Fifth Avenue headed to the Frick Museum. The cabby had his radio on when the announcer interrupted to tell of the attack on Pearl Harbor. We were all in shock. The three of us went on to the Frick and walked through the rooms in silence. Dick especially liked the Vermeers, and we looked at them together. Their beauty calmed us for the moment. 

The next day Dick quit his job at Tiffany’s and enlisted in the Air Force. His action didn’t surprise me. Dick had believed war with Hitler was inevitable since our trip to Germany six years before. His views were not popular; most of the people I knew, including many of my family and most of Dick’s, were opposed to the United States entering the European war. That was natural enough given the horrors of World War I, and it was a much more widely held sentiment than we acknowledge today. The year before, Dick and I had been asked to join the Council on Foreign Relations, and I remember Dick arguing strongly for intervention on the side of the British. Many of our elders at the council vehemently disagreed. 

Shortly after college Dick had married his childhood sweetheart, Ann Alsop, and they had two small children, George and Comfort. Dick was devoted to his family, but duty to his country and to the principles he believed in had to come first. After Germany invaded Poland, he started flying lessons so that he would be prepared when war came. He rose at five in the morning, drove to Floyd Bennett Field on Long Island, and flew for an hour or so before reporting for work at Tiffany’s at nine. 

In early 1942, before he left for flight training, Dick and I had lunch at the Harvard Club. Neither of us had any experience with war, but we U had heard the reports from Europe and knew the life expectancy of combat pilots was not great. Dick said he thought it unlikely that he would return from the war. I remember his words: “David, I have a wonderful wife and two beautiful children. I hope I can count on you and Peggy to look after them if anything does happen to me.” For the first time I fully understood the depth of his convictions and realized that I might soon be losing my best friend forever. In a subdued and shaken voice I assured him: “Of course we will, Dick. You can count on us.” 

Although I admired Dick for his strong beliefs and his decisiveness in acting on them, I was ambivalent about enlisting immediately myself. Peggy was not having an easy time adjusting to being a Rockefeller and had just given birth to our first child, David, Jr. I also felt more than a few misgivings about how I would handle military service. I persuaded myself that my war-related job would exempt me from active military service. Certainly Anna Rosenberg could pull a few strings if I asked. I was classified III-A because of my dependents, which meant I would not be drafted for some time, so I felt there was no need for an immediate decision. 

AN UNSETTLING CONVERSATION 

Until, that is, I had an unsettling conversation with Mother in her sitting room at 740 Park Avenue. My parents lived near us, and I stopped by a few times a week to say hello. One evening she brought up the war. Mother had long been a pacifist and, before Pearl Harbor, firmly believed the United States should remain neutral. Starting in the late 1930s, however, Mother became convinced that Hitler and his allies posed a profound threat to the United States and, indeed, to the deepest values of Western civilization. Her doctor told me later that with each domino that fell before the Nazi war machine—Austria, Czechoslovakia, Poland, and France—Mother experienced severe psychosomatic reactions, becoming extremely anxious and physically ill. 

No doubt one of the things Mother had long dreaded was the conversation she was having with me. She was gentle but firm in expressing her view that the United States had to fight to safeguard our I way of life and that men who were eligible ought to do their part by enlisting. They should not wait to be drafted. It was their “duty.” I remember her saying the word softly but emphatically. I was taken aback, not because it appeared she had changed her mind about the war but because she was telling me it was time to go off to fight and possibly die in the process. It was upsetting for me, and obviously it wasn’t easy for Mother, either. I knew Mother was right and that I had been indulging in wishful thinking. I discussed it with Peggy, who agreed. In mid-March 1942 I enlisted in the Army as a private even though Father could have used his influence to get me a commission. 

BASIC TRAINING 

I began basic training at Fort Jay on Governor’s Island on May 1, 1942. Governor’s Island lies off the southern tip of Manhattan. I slept in the barracks, which also housed the grooms for the officers’ horses. Each room in the barracks accommodated several score of enlisted men who slept in double-decker cots. I slept above one of the grooms. As the weather got hotter, the “aroma” of my bunk mate’s clothes, reeking of horse perspiration mingled with his own, grew stronger. He was an amiable fellow with very little education, but we got on well—save for the scent—and I valued his knowledge of horses and his many small kindnesses to me. 

Basic training consisted of endless hours of close-order drill, calisthenics, learning how to care for and fieldstrip our weapons, and, of course, the inevitable KP duty. At first the Army was something of a shock. It was at once threatening because it was all so new and, at the same time, boring and arduous. I had entered the Army with serious misgivings about my ability to cope with its rigors physically or to adapt socially. I had never been a good athlete, and I was not good at most competitive sports. Thus, having occasional bits of time to play baseball was more nerve-racking to me than close-order drill. At the outset I wondered how I would fare mixing with people from very different backgrounds, tastes, and skills. 

As it turned out, basic training went surprisingly well. Submitting to military discipline and getting on with my fellow trainees was much less of a problem than I had anticipated. I had a strong sense of duty, of doing what I was told (perhaps not so surprising, given my upbringing), and following orders was the primary attribute demanded of an enlisted man. 

I recall at one point that a few of us were assigned to paint the kitchen in the officers’ mess hall. I followed instructions faithfully, painting quite a bit more steadily than some of the others who had a more lackadaisical attitude toward Army orders and work. It certainly wasn’t my intention, but this impressed the officer in charge of the detail and also the other enlisted men. They were amazed that a Rockefeller was willing to do manual labor. I soon realized that I wasn’t as inept as I had feared; that I could get along and even become friends with people with whom I had few things in common. 

Of all the brothers, only Win and I enlisted. Win joined the infantry, went through officer candidate school at Fort Benning, and saw combat in the Pacific. He was seriously wounded when his troopship took a direct hit by a kamikaze off Okinawa in 1945. My eldest brother, John, first took a job with the Red Cross in Washington and then was commissioned in the Navy as a lieutenant in 1943. He worked for a special interagency group in Washington, the State-War-Navy Coordinating Committee, that planned for postwar governments in Japan and Europe. Nelson, as Coordinator of Inter-American Affairs, was, of course, exempt from military service. Laurance, however, had not yet decided what he would do, and that was the occasion of a somewhat cruel but nevertheless funny practical joke that Peggy and I played on him. 

After the first few weeks of basic training I was able to spend weekends at home with my family. Laurance and his wife, Mary, lived in an apartment in the same building at 115 East 67th Street. One Saturday they invited us for dinner. Peggy took some of Father’s office stationery and wrote Laurance a letter, signing it “Father.” The letter mentioned an admiral who had pulled a few strings and arranged for Laurance to be inducted immediately into the submarine service. It was all set; Laurance would sign up and enter training the following week. The letter closed with heartfelt expressions of pride and warm good wishes to his brave I son in what Father knew would be a “challenging service for his country.” 

Peggy had the letter delivered that morning, so Laurance would be sure to see it before dinner. When we arrived, Laurance looked quite ashen. He showed us “Father’s letter,” and we played along for a short while but didn’t have the heart to keep it up. Laurance was so relieved when we told him the truth that he forgot to be angry with us. 

Later, Laurance, who had learned a great deal about the aviation industry through his early business investments, was commissioned a lieutenant in the Navy and worked on the design and production of aircraft. 

PAINFUL LOSSES 

I got my corporal’s stripes shortly after finishing basic training and was assigned to the Counter-Intelligence Corps on Governor’s Island. In August I was sent to Washington to join a counterintelligence task force training for assignment in the Middle East. We met in the basement of an obscure government building for two weeks and heard rumors that we would be sent to Cairo in the near future. While I was awaiting orders, however, Colonel Townsend Heard of the American Intelligence Command asked for my transfer to his unit, which was about to be moved to Miami. I confess this came as a welcome surprise. Somehow I could not see myself as an “undercover agent” in the bars of Cairo. The transfer was arranged, and early that fall I reported for duty in Miami Beach, where Peggy and young David joined me. We rented a small house on La Gorce Island, and I bicycled to work each day. My duties were not very impressive or important—serving as a messenger and standing guard duty. 

During this time Dick Gilder was stationed at an air base in northern Florida. When he learned that his wing was soon going overseas, Dick wrangled a twenty-four-hour pass that allowed him to visit us before his departure. I was on guard duty when he arrived—making sure the colonel’s horses, stabled on the Firestone estate, were not hit by falling coconuts! 

Dick came out to be with me for part of the night. We talked of  nothing special, but everything seemed important at the time, and I cared very much that he had made the effort to see me. He reminded me of the promise I had made to him in New York, and I told him that he could depend on us. When I was relieved, we went back to the house to spend a few hours with Peggy. Early the next morning we took Dick to the station. As the train pulled out, Peggy and I turned to each other, both knowing somehow that we would never see him again. 

We spoke to Dick one last time when he called from his home in Tyringham, Massachusetts, just before he left for England. His wing refueled in Gander, Newfoundland, and then took off for the North Atlantic crossing. Dick’s plane and two others in his flight were lost without a trace. Ann learned later that the planes had been held in Gander because of indications that the engines had been tampered with. One would have to suspect sabotage as the cause of their disappearance. The war had barely begun, and already I had lost my best friend and Ann was a widow with two small children. 

Before the war ended, two other close friends would die. Walter Rosen, whose mother played the theremin, tried to enlist in the Army Air Corps but was rejected because of his eyesight. He then joined the Royal Canadian Air Force and was killed during the Battle of Britain. Bill Waters, my roommate from the LSE who only a few years earlier had stood with me watching Hitler march through the streets of Munich, died when his plane crashed outside of Kano, Nigeria. He and his crew were part of the vast armada that flew across the South Atlantic and Africa, and finally over the “hump” of the Himalayas to Chungking, to supply the Nationalist forces of Chiang Kai-shek. 

OFFICER CANDIDATE SCHOOL 

After a few months in Florida I asked Colonel Heard’s permission to apply for officer candidate school. He told me the competition was quite strong and that the best chance for getting a prompt acceptance was to apply to the Engineer OCS School at Fort Belvoir, Virginia, which had a reputation as the system’s toughest. My application was accepted, and I began the demanding three-month course in January 1943. 

OCS was much more rigorous than basic training, both intellectually and physically. At the end of the course we had to complete a twentymile march carrying an M-1 rifle and a field pack weighing eighty pounds. That night we pitched, and then immediately dismantled, pup tents in the deep snow and straggled back to camp at 5 A.M., only to be awakened two hours later for calisthenics. I was pleased to discover that I could handle the tough and disciplined side of the military as well as excel in the classroom. 

I was commissioned a second lieutenant in the Engineer Corps in March 1943 and received orders to report to the Military Intelligence Training Center at Camp Ritchie, Maryland, after a two-week leave. Peggy was already well along in her second pregnancy, so I was grateful for a short break that enabled me to be with her in New York. As the fates would have it, Peggy went to the hospital to give birth to Abby only a few hours after I left for Camp Ritchie. I got the news on my arrival and was granted a three-day pass to return to New York to see her and my newly arrived daughter. 

The two-month course at Ritchie trained officers for intelligence work with combat infantry units. The focus of our training was the battlefield; we studied the order of battle and combat tactics of both Allied and enemy forces, learned map-reading skills and reconnaissance procedures, and mastered techniques for the interrogation of prisoners of war. Each of us chosen for the course had been selected because we had special talents, such as language skills and familiarity with foreign cultures, that would be useful in the European Theater of Operations, our group’s ultimate destination. 

I met a number of interesting men at Camp Ritchie who would intersect with my life later on: Philip Johnson, then a junior architect who had already been involved with the Museum of Modern Art; John Kluge, who was born in Germany and later would found Metromedia; John Oakes, who later edited the New York Times editorial page; and Fred Henderson, part Apache Indian and a regular Army officer who made a career with the CIA after the war. His son, Brian, joined Chase in the 1960s before going on to a senior position at Merrill Lynch. 

After completing the course I was appointed an instructor in the French section of the school and remained for an additional three months to teach French army organization, giving the lectures in French. This assignment provided me with a good background for the task that  I would face for the final years of the war in North Africa and France. 

DUTY IN ALGIERS 

In late August 1943 my pleasant interlude in the Appalachians ended. On a lovely summer morning I opened sealed orders that assigned me to the Joint Intelligence Collection Agency (JICA) of the War Department and directed me to report immediately to Washington. 

I spent the next month at the Pentagon, where I learned that I would be assigned to JICA’s detachment at General Eisenhower’s Allied Force Headquarters (AFHQ) in Algiers. My fluency in French, knowledge of the prewar European political situation, and time as an instructor at Camp Ritchie seemed to qualify me as a French “expert”—or so the War Department believed. 

I left Washington on September 23, 1943, with about one hundred other servicemen crammed onboard a noisy, drafty DC-4. We crossed the North Atlantic to Prestwick, Scotland, seated side by side along the fuselage in “bucket” seats, a hard metal bench with shallow indentations on which you planted your buttocks. The thirteen-hour flight was an exhausting experience. 

I had spent two days in Prestwick waiting for transport to North Africa before I ran into William Franklin Knox, the Secretary of the Navy, whom I had met when I was a student in Chicago. He offered to take me on his plane—which had much more comfortable seats—as far as Rabat, Morocco, where I was able to pick up a ride on a military plane to Algiers. 

Because I was entering a combat zone, the Army issued me a .45- caliber pistol, two magazine clips, twenty rounds of ammunition, a first aid kit, a compass, and a pair of suspenders (which I promptly lost). I was also given little information booklets with helpful advice on how to behave in North Africa: “Never smoke or spit in front of a mosque.” “Don’t kill snakes or birds. Some Arabs believe the souls of departed chieftains reside in them.” “When you see grown men walking hand in hand, ignore it. They are not ‘queer.’ ” One book admonished the reader that staring at Muslim women or touching their veils could start a riot! 

None of this prepared me for the beauty of wartime Algiers. The city stretched for miles in a crescent along the aquamarine Bay of Algiers. The modern French city, built close to the harbor, had wide boulevards, handsome government buildings, and private villas interspersed among parks filled with date palms and flowering plants. Nearby was the older Arab city with its winding streets, whitewashed buildings, and slender minarets, crowned by the Casbah, the ancient Moorish citadel. The Sahel Hills framed the city, and in the distance loomed the coastal mountains. Allied shipping crowded the harbor, and the streets were filled with military men from around the world: Americans, British, Australians, Indians, South Africans, as well as Arabs and Berbers and, of course, the French. 

By the time I arrived in Algiers, the real war had moved on. Rommel’s Afrika Korps had been driven from its last bastion in Tunisia, and Eisenhower had captured Sicily in a lightning campaign. In early September, Allied forces crossed the Straits of Messina and started the long and bloody campaign up the Italian peninsula. The beauty of Algiers masked the intrigue that simmered just below the surface. The intense battle within the French Committee on National Liberation (CNL) for control of the Vichy French civil and military authority in North Africa absorbed everyone’s interest. And central to that struggle was the question of whether General Henri Giraud or General Charles de Gaulle would control the CNL. 

Giraud was one of the leaders of France’s brief and ineffectual struggle against the Germans in 1940. Captured and interned, Giraud escaped from the fortress of Konigstein in Austria and made his way to unoccupied France. Untainted by collaboration with the Germans and deeply respected by the French officer corps, Giraud seemed the ideal candidate to replace Admiral Jean-François Darlan as chief of state in North Africa. Following Darlans assassination in December 1942, Giraud, with the full backing of President Roosevelt and his senior advisors, became the commander of French military forces. It appeared to be only a matter of time before he took control of the political structure as well. 

Charles de Gaulle, who would become one of the great figures of the postwar period, was still an obscure military man with a small following and few financial resources in 1943. After the French defeat in 1940, de Gaulle organized the Free French from the remnants of the army that  had made it across the Channel after Dunkirk, and proclaimed the French Government in Exile. Although most of the French officer corps detested de Gaulle, Churchill respected his fighting spirit and pressed Roosevelt at the January 1943 Casablanca Conference to include de Gaulle’s Free French in whatever political structure was established in North Africa. The outcome was that the two rivals were forced together in a “shotgun wedding” and told to work out their differences. 

INITIATING AN INTELLIGENCE NETWORK 

By the time I arrived in Algiers, the Giraud–de Gaulle marriage was on the rocks. The two had spent ten months maneuvering deviously and incessantly against each other. While de Gaulle had clearly gained the upper hand in the political struggle, it was by no means certain that he would prevail. Their continuing conflict demanded solid intelligence both because of its implications for the war effort and the impact it would have on postwar France. 

The Joint Intelligence Collection Agency North Africa (JICANA) was composed of about ten officers and thirty enlisted men drawn from all of the U.S. intelligence services. We operated from an office on le boulevard du Telemly, and the officers shared quarters in a private villa across the street. Our primary job was to “collect” intelligence produced by the military intelligence services operating in North Africa and to pass this material along to Washington and London. JICANA functioned as a clearinghouse and a postal service. This was not a particularly arduous task and left the officers with a great deal of leisure time, which was devoted to sampling the quite palatable local vintages and scrounging black market restaurants for rationed delicacies not available to the general public. 

I found the work disappointing. I had been led to believe that I would be involved in a much more active intelligence-gathering operation that would utilize my specialized training. Colonel Byron Switzer, my commanding officer, felt differently. An engineer with little intelligence background, the colonel believed JICANA had no mandate to originate its own intelligence reports. Shortly after my arrival I wrote my parents that “no one seems to know what I am supposed to do.” 

After a few weeks of collating reports prepared by other agencies and growing increasingly frustrated, I asked Colonel Switzer if I could try my hand at reporting on political activities and economic conditions in the region. After some hesitation he agreed to my request, and I set about creating my own intelligence “network” from scratch. 

Frankly, this was an almost impossible task for someone in my position. I was only a second lieutenant and was competing with the more established intelligence services—including Colonel William Donovan’s Office of Strategic Services. However, I did have a few advantages. I spoke French and understood the political and economic situation better than most. In addition, I had letters of introduction to a number of influential people, two of whom proved to be of immense help. 

Henri Chevalier, Standard Oil of New Jersey’s general manager in North Africa, had lived in Algiers for many years and had wide contacts within the business community across North Africa. Henri introduced me to a number of colons (Algerians of French descent) and to others who had left France after the German occupation. Among the latter was Alfred Pose, the powerful head of the Banque National pour le Commercial l’Industrie’s branch system in North Africa, who introduced me to influential Arab businessmen and political leaders. 

Prime Minister Mackenzie King, my father’s old friend, wrote on my behalf to General George Vanier, the senior Canadian representative in North Africa. The friendship I developed with General Vanier brought me into contact with a number of people in the Allied diplomatic community and with members of the CNL, whom it would have been difficult for me to meet otherwise. Vanier’s military attaché, Colonel Maurice Forget, invited me to join a ten-day trip through Morocco with a group of military attachés. That trip provided me with a number of new contacts and a broader understanding of the precarious French position in North Africa. 

I also began to meet senior people in Allied diplomatic circles and in the CNL, among them Ambassador Robert Murphy, a staunch Giraud supporter who had prepared the way for the Allied landings in North Africa. I also met several of Murphy’s famous vice consuls, such as Ridgway Knight, who would later join me at Chase. It was in Algiers that I first became friends with William Paley, the founder of CBS, who ran  the psychological warfare program in the theater, and C. D. Jackson, one of Paley’s deputies and later publisher of Fortune magazine. 

Within a few months I developed a large and well-placed network of informants, which enabled me to report thoughtfully on the evolving political situation in North Africa. Colonel Switzer saw the merit of my work and gave me a free hand, even to the point of allowing me to make forays—about ten thousand miles of it in a jeep—throughout Algeria, Morocco, and Tunisia, as well as a two-week trip to Cairo and Istanbul to deepen my contacts with French intelligence officials. Presumably, the reaction from Washington was favorable since I was not told to stop. 

GIRAUD VERSUS DE GAULLE: AN INSIDE VIEW 

The most valuable contacts I developed were within the CNL command itself. Two men in particular enabled me to obtain an inside view of the rivalry between Giraud and de Gaulle. A friend of Mother’s introduced me to de Gaulle’s aide-de-camp, Etienne Burin des Rosier. Like most of de Gaulle’s entourage, Etienne kept a chilly distance from most Americans, but he was friendly to me and occasionally provided me with useful information. 

Even more responsive was Léon de Rosen, Giraud’s aide-de-camp. A refugee from the Russian revolution, Léon had worked his way up from a menial job to become director of the Fiat assembly plant in Provence. He joined the French Foreign Legion in 1939 and became one of Giraud’s aides in late 1942. Léon and I became good friends, and he was quite willing to provide me with information on the struggle between de Gaulle and Giraud, because, no doubt, he felt it would be communicated to sympathetic ears in Washington. 

Even Léon recognized that Giraud’s political ineptness and connections to conservative political circles made winning the political struggle with de Gaulle a difficult proposition. De Gaulle, on the other hand, was astute and ruthless, and step by step he outmaneuvered his older rival. As the year progressed, Giraud became increasingly isolated, and as I drove down the boulevard de la République, the main street of Algiers, I saw more and more flags displaying the blue and white cross of Lorraine, de Gaulle’s liberation emblem, flying next to the tricolor.

By April 1944 the struggle was over. De Gaulle forced Giraud from the CNL and sent him in exile to the town of Mostaganem, near Oran. A few weeks later and shortly after Giraud survived an assassination attempt, Léon invited me to visit them for a long weekend. I talked with the general for several hours, and he told me in detail about his escape from prison, his months hiding out in the south of France, and his negotiations with the Allies in the weeks leading up to the North African invasion. Giraud was a proud man with all the soldierly qualities, and he had accepted his defeat with dignity and sadness. He gave me fascinating insights into the political situation, which had important consequences for the postwar period, which I passed on to Washington. 

Much of my reporting focused on the anti-colonial movement that was gaining strength among the Arabs and Berbers throughout the Maghreb. This was of considerable significance since the U.S. government was on record as favoring the independence of colonial areas in Asia and Africa after the war. In one report I said: “German propaganda in North Africa among Arabs no longer effective. Arabs supporting the Allies. No fundamental hostility between Jews and Muslims in Algeria. . . . Arabs’ principal antagonism is toward the Colons. . . . Communism said to be spreading rapidly. . . . Ultimate objective of Muslims in North Africa said to be political and economic equality with other national groups.” 

It was clear to me that even though Algeria had been incorporated within “metropolitan France,” the Arabs and Berbers resented French control. The beginnings of the Arab revolt that would culminate in Algerian independence in 1960 could already be seen during World War II. However, it would take a savage colonial war and the near collapse of the French Republic itself before that occurred. 

Although my duties in North Africa were not hazardous, there were moments of extreme danger. The closest I came to death was on a routine flight from Morocco to Oran, and it wasn’t from enemy fire. I was on a DC-3, sitting, by chance, with Adlai Stevenson, who was on a mission as an assistant to Secretary of the Navy Knox. We encountered severe turbulence, but the real problem was cloud cover, which made it   impossible to get visual bearings to land in Oran. The plane was not equipped with radar, and the pilot circled for a long time hoping for a break in the clouds. Looking over the pilot’s shoulder I saw the gas gauge needle pointing ominously to empty. The pilot was visibly nervous, Adlai had turned green, and I probably looked the same. As a last resort the pilot took the plane down through the clouds to get his bearings, hoping we didn’t hit a mountain in the coastal range. We descended for what seemed like an eternity before breaking through the clouds above the landing strip at an altitude of about one hundred feet. The pilot landed safely, bringing a terrifying flight to a prosaic conclusion. 

TO HOME AND BACK 

In July 1944, Colonel Switzer arranged for me to act as a courier to escort our intelligence pouch to Washington. On my arrival I was given a fifteen-day leave to visit Peggy and the children. There were now three; Neva, the youngest, had been born in June, and I saw her for the first time. It was a welcome respite and one that few Gl’s ever had. It also gave me an opportunity to reassure Peggy that I cared for her and missed her, and tell her how important she was in my life. She had cause to wonder since my letters, though frequent, arrived after delays of several weeks. The problem was the “V” mail system; one wrote letters on a single sheet of paper, which were censored, microfilmed to reduce their size for shipping to the United States, then blown back up to normal size, and finally mailed. This cumbersome process caused Peggy much stress and anxiety. My stay was painfully short; we hardly had time to get reacquainted before I had to leave. 

SOUTHWEST FRANCE 

I returned to Algiers just before the Allied invasion of southern France in August 1944. The city had become a backwater, and there was little for me to do. I desperately wanted a transfer and finally received new orders in early October transferring me on a temporary basis to “T” Force, a frontline intelligence unit attached to General Alexander Patch’s  Seventh Army, which had moved north along the Rhone River to join forces with General George Patton’s Third Army near Lyon. I joined the unit near Dôle in eastern France. The front was only a few miles away, and there was a constant movement of men and supplies toward the Rhine and the steady rumble of artillery. 

“T” Force was the brainchild of Colonel James Pumpelly, who had been the deputy commander of JICA in Algiers when I first arrived. The unit’s mission was to travel with frontline combat troops and seize critical scientific and technological information before the enemy could destroy it. However, the colonel had a different job in mind for me. He had been impressed by my work in Algiers and asked for my transfer to handle a special assignment. Eisenhower’s headquarters, Pumpelly told me, had little reliable intelligence about the immense area west of the Rhone and south of the Loire rivers, which had been bypassed in the rapid pursuit of the German armies toward the Rhine. There were reports of German SS units operating in this area, and other accounts that the French Communist resistance controlled vast portions of the countryside and would launch an insurrection when the time was right. Along the border with Spain, units of the Spanish Republican Army were known to be still active. As resistance groups evened old scores by purging collaborators with drumhead courts-martial and summary executions, there was a danger that the situation might degenerate into civil war. 

Colonel Pumpelly ordered me to assess the political situation, the state of the economy, and the degree to which foreign forces or indigenous radical groups posed a threat to Allied forces or the authority of the new French government in extreme southwestern France. Although Pumpelly gave me a general idea of my mission, he left it to me to make my own way. 

MEETING PICASSO 

Since the successful completion of this mission would require assistance from the newly established French Provisional Government, I went to Paris to request help from some of my old friends from Algiers who had moved to France with de Gaulle. I spent a few I days visiting government offices and the Deuxième Bureau of the Army and was given several “To Whom It May Concern” letters that would prove of great value. 

One morning I ran into Henri Laugier, the former rector of the University of Algiers who had been a member of the CNL in Algiers. He invited me to lunch with him at the home of his mistress, Madame Cuttoli, an art dealer in Paris with whom my mother had dealt before the war. Her husband, an elderly, semi-senile former senator from the Department of Constantine in Algeria, was confined to a wheelchair in his upstairs bedroom. Much to my delight the fourth member of our luncheon party was Pablo Picasso, who, Laugier informed me, had also been a lover of Madame Cuttoli before the war. 

Picasso, though not yet the preeminent artist he would become, was already a well-known personality. He was subdued and did not talk much about his wartime experiences, which he had spent quietly in the south of France. Upon his return to Paris in the autumn of 1944, he had immediately joined the Communist Party. Nonetheless, he was warm and friendly to me, and was pleased Mother had been an early collector of his drawings and prints, which she had acquired through Madame Cuttoli in New York before the war. 

It was a memorable if somewhat disconcerting meal. The aged senator remained upstairs while his wife, Picasso, Laugier, and I enjoyed a sumptuous meal. Neither Madame Cuttoli nor her amorous friends were the least embarrassed by their past or present relationships, even when we all visited her husband in his bedroom. 

CUT OFF FROM THE WORLD 

I returned to Luneville in early November 1944 to make final preparations for the trip. Colonel Pumpelly assigned me a jeep and a young Navy yeoman driver, Buddy Clark, who doubled as a stenographer. We towed a small open trailer filled with five-gallon cans of gasoline and large quantities of C rations since both fuel and food were in short supply in the area. Buddy and I were completely on our own during the entire six-week period. I don’t recall any other time in my life when I was so completely cut off from the rest of the world for so long. 

The area we had been assigned was the ancient lands of the Languedoc, the Midi, and Gascony. It was a glorious trip through some of the most beautiful country in Europe. The last of the harvest was being brought in, and the distant peaks of the Pyrenees were white with the first snows of winter as we drove from Perpignan to Toulouse. Only a few hundred miles away millions of men were locked in savage combat. 

We visited the regional capitals of Nîmes, Montpellier, Perpignan, Toulouse, Pau, and Bordeaux, where I met the new commissioners of the Republic appointed by de Gaulle. I was well received and had no difficulty getting them to talk about the political and economic situation in their areas. I also spoke with many people I met along the way who represented a variety of backgrounds and points of view. In many of the places we visited, we were the first Americans anyone had seen since 1940. It was a fascinating and, at some points, a nerve-racking mission. 

Returning to Luneville in mid-December, I dictated reports on each department, which were sent to AFHQ and Washington. I had found nothing to substantiate the reports of subversive elements roaming the countryside, but there was great political and economic uncertainty, as well as anxiety about the progress of the war. With winter fast approaching and food and fuel supplies low, I suggested the situation could deteriorate quickly if supplies were not sent in from the outside.* 

INTELLIGENCE GATHERING IN PARIS 

Although I had hoped to remain in France after completing my mission, the Army had other plans. I was sent back to Algiers and spent a desolate Christmas there waiting for a new assignment. Finally, in February 1945, just after I was promoted to captain, I received orders to report to Paris as an assistant military attaché. 

A few weeks later General Ralph Smith was appointed military attaché. General Smith had served in France during World War I, married a French woman, and spoke the language well. He had fought in the Pacific and commanded the assault on Makin Island in 1943. General Smith brought with him as an aide Captain Warren T. (Lindy) Lindquist, who had won the Silver Star for bravery at Makin. Lindy and I became friends and also got along well with General Smith, who asked us to share his quarters on the boulevard Saint-Germain. Once again my responsibilities as an AMA were not clearly defined. General Smith was a combat officer with little intelligence experience. When I told him what I had done in North Africa and southwestern France, he suggested that I set up a similar political and economic intelligence unit, reporting directly to him. He assigned Lindy to work with me, along with two lieutenants, one of whom, Richard Dana, had been a friend of mine in New York and would, like Lindy, work for me after the war. 

I built the intelligence operation around my contacts with members of de Gaulle’s government. Rather quickly we were reporting on the Provisional Government and its internal conflicts. We kept a particularly close watch on the competing French intelligence services—the Army’s Deuxième Bureau, the Gaullist Secret Service, and the remnants of Giraud’s intelligence apparatus. We learned that Jacques Soustelle, head of the Gaullist operation, had been ousted after a “heated cabinet discussion.” André DeWavrin, who used the nom de guerre Colonel Passy, replaced him. The Colonel was believed to have been a member of the Cagoulards, the rightist group that had almost toppled Léon Blum’s Popular Front government in a 1937 coup attempt. I had written a report on Passy the year before, saying, “There are few people in Algiers more generally feared, disliked, or distrusted. . . . He has openly expressed the desire to get control of the police of France so that he can eliminate the elements he considers undesirable.” 

Somewhat naively I sent out a questionnaire to U.S. military commands asking for all material on French intelligence. Not surprisingly, Colonel Passy learned about my inquiries. Although everyone did it, it wasn’t comme il faut to be caught spying on one’s allies. Within days Colonel Passy summoned me to his office. He seemed in a good mood and ushered me to a seat with a friendly wave of his hand. We chatted amiably, then he said, “Captain Rockefeller, we have come to understand that there is information you would like to have about our services.” He looked at me and raised his eyebrows as if to say, “Isn’t that so?” I nodded. I could tell he was clearly enjoying my agony. “But my dear captain,” he continued, “really, all this is readily available to you if you will just ask us for it. Please tell me what you would like, and we will be glad to provide the information.” I thanked O him for his offer and left as quickly as possible. 

Fortunately, not all our efforts were quite that inept. We prepared a steady stream of reports on the critical economic situation and the increasingly unstable political scene. De Gaulle was running into serious trouble by the late spring of 1945. His arrogance, inflexibility, and single-mindedness, qualities that had been so essential to his political triumph over Giraud in Algiers, created serious problems as the French went about the task of forming a permanent government and drafting a new constitution. Within a year he would fall from power. 

While we developed most of our information through our own network of informants, a good part of it came as a result of the dinners that we hosted for high-ranking French officials at General Smith’s residence. A well-stocked wine cellar and a fine table proved to be a wonderful inducement to revealing conversation. 

THE AFTERMATH OF WAR 

On May 7 the Germans surrendered and Paris celebrated VE day. It was a beautiful spring day that turned into an evening of wild celebration. The embassy closed, and we all went out into the streets for a party that lasted all night. That night and for a brief time afterward one had the unique experience of having Parisians be friendly to you precisely because you were an American! 

Paris, physically untouched by the war, was the most beautiful I had ever seen it. The scarcities caused by the war actually burnished the city’s many charms. Gasoline was strictly rationed, so the streets were virtually empty of cars. I walked across the Seine to the embassy every morning and saw only an occasional automobile. Instead, the streets were filled with women on bicycles riding home from the markets with long loaves of bread under their arms, sitting carefully on their long skirts that would catch the wind and billow out behind them as they rode. 

I was eager to return home but had not yet earned enough “points” to be demobilized. In the interim, General Smith sent me on several interesting missions. One, only ten days after the surrender, took me to Frankfurt and Munich. Allied bombing had almost destroyed both cities, I and it was shocking to see the extent of the devastation. I saw my old Harvard friend Ernst Teves in Frankfurt for the first time since 1938. Ernst had volunteered to work for the U.S. Occupation as soon as the war ended. Our meeting was difficult, and Ernst’s account of his war years was distressing for a friend to hear. He had never become a Nazi, but the compromises he had made in order to keep his family’s business operating eroded his principles and coarsened his values. 

In Munich I returned to the Kaulbachstrasse, where I had lived with the Defregger family in 1933. The street was covered with rubble, and most of the houses had been destroyed. Somehow the Defreggers’ house had escaped serious damage, and the family greeted me at the door. They were amazed and overjoyed to see me, and crowded around, shaking my hand and asking questions. I was glad to see them and relieved that they had survived the war, but it gave me a strange feeling to see them again after so many years. The war and its terrible passions now stood between us: the deaths of Dick Gilder, Walter Rosen, and Bill Waters; the destruction I had seen across France and Germany; the wasted years away from my family. The Defreggers had not started the war—indeed, they had suffered from it—but the horrible tragedy had begun in that city, and I had watched its “evil genius” walk through Munich’s streets only a few years before. 

The next day I visited Dachau, the infamous concentration camp nestled incongruously amid the gentle hills north of Munich. The camp’s inmates had been evacuated, but one could still see the barracks in which they had been housed and the grotesque crematoria where their emaciated bodies had been burned. Scraps of striped cloth still hung in the rusting barbed wire beneath the guard towers. It gave me an understanding I had not had before of the horrors of the Nazi regime, the full extent of which we would only discover with the passage of time. 

COMING HOME 

In August, Uncle Winthrop came through Paris, and we talked about my plans for the future. He said that a career at the Chase National Bank, of which he was chairman, was the logical path for me to follow. I didn’t give him a firm answer but said I would think seriously about it. 

Orders recalling me to Washington came through in early October. I wrote Peggy that I had no way of knowing the day of my departure, nor would I be able to notify her when I did find out. Peggy was so impatient that she went to Washington to stay with Nelson at his home on Foxhall Road. Each day for a week she drove to the airport and anxiously scanned the crowds of arriving servicemen. Each day she returned home disappointed. When I finally squeezed aboard a plane, it landed in New York. I called her immediately, but it was another day before I could join her in Washington. 

Peggy and I were overjoyed to be together again, and it is difficult to find the words to describe my emotions when I saw my three children, David, Abby, and Neva, although to them I was a stranger. It was some time before they accepted the fact that I was their father and not just a competitor for their mother’s time and attention. 

The war years had taken a toll. While I had been traveling and getting to know interesting people, Peggy had a different experience. She had endured the restrictions of rationing and the constant fear that I would not return. It was a lonely and difficult time for her. What I had not known was that Peggy was in the midst of a perplexing struggle with her mother, who treated her as if she were still a child, telling her how to dress, how to furnish our home, and how to bring up the children. Peggy resented this but felt powerless to resist it and never told me about it until years later. She was under enormous psychological pressure, which contributed to her recurring periods of depression. 

Peggy battled depression for more than two decades. The key moment came when she broke free from her mother and sought psychological counseling. In the end she overcame her problems, and the last twenty years of her life were her happiest. 

Men of my generation often refer to their military service as good or bad. I had a good war. I had been confused and apprehensive at first but soon learned to adapt and then how to use my newly acquired skills effectively for the benefit of my country. I look back at the war years as an invaluable training ground and testing place for much that I would do later in my life. Among other things, I discovered the value of building contacts with well-placed individuals as a means of achieving concrete objectives. This would be the beginning of a networking process that I would follow throughout my life. 

*More than four decades later I discovered my reports had been preserved, and I was able to get copies of them from the National Archives in Washington.

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EMBARKING ON A CAREER AT CHASE

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