K STREET Chapter Five

I believe that houses are like the people who occupy them. If they remain standing long enough  they can become all things. First the little house on K street was a home,  and then it was a bordello and a bar, and then it sat empty for a few years. I mean, who would want to live in such an infamous den of inequity? That question was answered during the roaring twenties, when 1625 K street became the home of various fraternities associated with George Washington University - the campus is one block south across Pennsylvania Avenue, between 24^th and 19^th Streets. But the frat parties came to abrupt end with the onset of the Great Depression.

One in four Americans lost their jobs. Those who still had a job saw their wages fall by almost half, at the same time that the price of food went up. 

Those who lost their home or apartment threw up shacks and shanties on vacant land and called them "Hoovervilles".  Empty pockets turned inside out were called "Hoover Flags". There were literally millions of Americans in agony.  Industrialist Henry Ford proclaimed that the Great Depression had been caused by “an era of laziness”, and President Hoover, from his government subsidized home three and ½ blocks south of the Little Green House, seemed to agree. But to the vast army of unemployed, that did not seem to be so much an answer as a justification as to why Ford's family was not going hungry like theirs. The District of Columbia in 1930 had a population of 607,000 people, and almost half of them had no regular income.

Still the town should have barely noticed when on December 5^th ,  1930 some 3,000 communists came from all over the eastern half of the United States to stage a “hunger march” in Washington.

The march was badly organized. The timing was stupid. Two marchers died from exposure to the harsh winter weather, fifteen others came down with pneumonia, twenty with the flu. Still the government managed to overreact. There were more cops than marchers. Great sums had been spent to isolate the communists, far more than was spent in relief efforts. If the American Communists had been better organized, they might have posed a real threat to the capitalist system, because President Hoover decided the best capitalism could do was to encourage those with money to invest it. They did, but not in America.

In response to Hoover's pleadings, some investments were made. In 1931 the frat house at 1625 K street was remodeled into office space. But by then there was not much call for new office space, even in Washington D.C. The economy did not need old spaces given new names. It needed new purposes. The little Green house, now a little green office building, sat empty, waiting for something to happen.

In 1932 fifteen thousand well organized WWI veterans marched on Washington, petitioning their government for early payment of their long promised war bonuses. The money was supposed to be paid in 1945, but the men were hungry now -  their children were hungry now

The powers that be called out their District of Columbia police force (above). Shots were fired. Two veterans were killed. A few cops were beat up. The Federal government decided that the problem was not that the working stiffs had been pushed to far, it was that not enough force had been applied to keeping them under control.

That “enough force” had a name – General Douglas MacArthur (above, left). Ordered to clear the “Bonus Army” from around Jenkin's Hill, the imperious MacArthur sent in tanks and troops with fixed bayonets and tear gas. Crowds of government workers shouting “Shame, shame” at the soldiers did not shame MacArthur.

Once the area around capital had been cleared the General led his little army across the river to attack the shanty town  where the desperate veterans had left their families (above). This had not been ordered. MacArthur did this on his own. The two infants who died in this assault were MacArthur's trophies, as were the hundreds of mostly women, who were beaten and bloodied in this lesson for the lazy. 

Major Dwight David Eisenhower (above, right), who was the liaison with the district cops, described the burning of the shantytown as “pitiable.” MacArthur (above, left), who had pity only for injustices suffered by himself, was quietly retired and given a  job in the far off Philippines where it was to be hoped, he would never be heard from again.

In 'upper crust' Washington, “Old” Washington, the removal of General MacArthur was a defeat equal to surrender at Appomattox Court House. He had been one of them. Still, with the incoming new administration there was reason for the wealthy denizens of Washington to hope. 

Wrote the Saturday Evening Post, “No occupants of the White House since Theodore Roosevelt had been so significantly favored as to birth and material circumstances (as FDR). Even the so called "Cave Dwellers" dropped their masks of indifference and cheered openly. At last the Nation was to have a President and First Lady who have enjoyed exceptional privileges due to family position and wealth”.

The upper crust of Washington had acquired the nomen of The Cave Dwellers, because they were rarely seen outside their Kalorama neighborhood, to the North of K street. And the subsequent invasion of Washington by the army of Roosevelt's New Deal technocrats now destroyed “the incomparably delightful relationship between the official and social life” of Washington.

The small southern town inside Washington was suffering a revolution - as usual, hardest felt in the mundane things of life. In 1937 some 40,000 people jammed Washington's Union Station (above) twice a day, coming and going.  Suddenly, Washington (and the government) was going to work.

Federal clerks toiling away in un-air-conditioned offices now numbered a daily invasion of  200,000, since most could only afford to live outside the district. And then came the final insult.  

In 1937 plans were announced to cut down 50 of the imported Japanese Cherry trees to make room for the planned Jefferson Memorial.

Outraged, a group of female Cave Dwellers chained themselves to the trees – their final line in the sand had been drawn at trees, not people. But it was a pitiable last stand.  A brainy New Dealer came down in person and served the ladies coffee in china cups. He listened to their passion for tradition. He served them more coffee and promised to replant any trees damaged. 

Then he served them more coffee, and when the ladies slipped their chains to escape to the toilet, the trees were bulldozed, and the construction proceeded. (The trees were later replaced).

Like an ancient totem which had lost its magic, in early December of 1941 the Little Green House on K street was also bulldozed. The safe in the backyard was plowed over. And in its place an 11 story steel frame concrete structure would rise. And like the rest of Washington, it would be filled with lobbyists.

                                      - 30 - 

K STREET Chapter FOUR

 

I do not find it surprising that less than an hour after prohibition became the national law, at midnight on January 17th 1920, six armed men stole $100,000 worth of “medicinal whiskey” out of two rail cars parked unguarded on a Chicago siding. Even at that early moment America's dream for a moral nation, drunkenly stumbled over the sobering reality that alcohol has never been a mere beverage. 

In 1920, the first year of national prohibition,  35,000 doctors would be granted permits to prescribe various potable forms of alcohol for their patients -  those suffering from strokes and stress as well as the long term pain of arthritis, cancers, congenital headaches, congestive heart problems, depression and the general aches and pains of old age. 

That same year the company which distilled “Old Grand Dad” reorganized itself as The American Medicinal Spirits Company and kept right on distilling  “Old Grand Dad Whiskey”.  In fact their business was booming. 

In the first five years of prohibition, the domestic manufacture of hard liquor in America more than doubled. And that is how America supplied its booze fix, for most of prohibition - not with bathtub gin, or rum-runners over the high seas. It was domestic product, heavily watered down and over priced, and supplied by the same distilleries that had existed before prohibition. 

As an article for “The Nation” magazine lamented in 1921, “In the U. S. are 27 warehouses in which 15,000,000 gallons of liquor are stored. The liquor is private property held for legal sale as medicine....

....a system of permit withdrawals was devised by the enforcement officials for each case (3 gallons) of liquor."   It very soon became apparent that a vast amount of fraud was being perpetrated.  It was the  bribes that bought these permits that filled the backyard bank of the Little Green House on K street. The author of that article was Roy Haynes.

Each “Withdraw Permit” had to be signed by the Prohibition Commissioner, Roy Asa Haynes (above), who was famous in anti-saloon league politics and a political appointee by President Harding.  

The going price for each permit from the Ohio Gang on K Street was $15.00. The very first permits, for the withdrawal of some 2,000 cases of alcohol, was issued to the General Drug Company of Chicago, for which J.B. Kraffmiller was paid $20,000, cash.  He kept $6,500 and passed on the rest to Howard Mannington at 1625 K Street, who divided it amongst the rest of the Ohio Gang, each member getting $2 per case.  

Even the General Drug Company got a one dollar kickback, for the use of their good name on the sales permit. What General Drug did not get was the booze. That went directly to the bootleggers who had actually bought the liquor and paid the bribes. They passed along this overhead to their customers,  who happily paid a dollar for a drink which the year before had cost them a quarter. And as Agent Means in the basement of 1625 K street sang, my God, how the money rolled in. 

The very first year of prohibition, it is estimated, bootleggers made about $100 million dollars in profits. K street was not guilty of bootlegging. As was tradition, they were merely the facilitators.

The bag man in this facilitation was Jess Smith (above), the Attorney General's “jovial, rotund, combination confidant and valet.” Agent Means described him this way; “Poor Jess, he was a typical city department-store floor walker, transplanted into alien aisles....at a complete loss. And how he loved clothes. He worshiped Daugherty with a dog-like devotion.” This seedy looking man in expensive suits was the go-between, shuffling from his boss and idol, Attorney General Harry Daugherty (and Roy Haynes) and Henry Mannington and J.B. Kraffmiller in the Little Green House on K Street.

Two or three times each week Jess would arrive at 1625 K Street to deliver instructions and payoffs, and pickup the cash that been laundered through an Ohio bank owned by AG Daugherty's brother Milo. Jess Smith kept everything straight in the meticulous notebooks he carried on him, the “who”, the “how much”, the “for what”, and the “for whom.”

It was the sweetest deal in the history of K Street, and you just knew some schmuck was going to screw it up. The schmuck turned out to be the keeper of the backyard bank, Federal Agent Agent Gaston Means (above). For him bountiful was never enough.

In the winter of 1922 Means got his hands on several blank liquor Withdrawal Permits. He forged Haynes' signature, and started selling them on his own. It took very little time for word to get back to Daugherty, who, in February, suspended Means from the Bureau of Investigation. But the Attorney General dare not remove Means from the Little Green House, because Means had all those file cabinets in the basement, stacked with names, dates and amounts.  

In the mid-term elections of November, 1922 the Republicans lost five seats in the House and the Democrats were beginning to percolate over Republican scandals as a 1924 campaign issue. So, in the spring of 1923 ,Daugherty was forced to admit to President Harding the trouble Means was causing. It was decided a sacrificial lamb would have to be offered up to the Democrats, and since it could not be Means, “poor Jess” was tailor made for the role, you might say. Jess had his own notebooks, but because of his devotion to the Attorney General, he could be controlled.

On the morning of Tuesday, May 29^th, 1923 Jess Smith played golf with Attorney General Daugherty, and during their game was informed that he had to leave Washington the next day, permanently.  Jess did not take it well.

Daugherty then proceeded to the White House, where he phoned another associate, Warren Martin, and ordered him to go the Wardman Hotel and stay with Smith until the poor man was out of town. At six the next morning, Martin was suddenly awakened in his room by an explosion. He found the 61 year old Jess Smith, in his pajamas and a dressing gown, lying on the bedroom floor.  Smith's head was inside a trash can, a bullet through his brain. A gun lay on the floor, inches from his fingers. There was no autopsy. His death was ruled a suicide by a friendly doctor. His meticulous notebooks and personal correspondence mysteriously disappeared.

Sixty four days later, on the second of August, President Warren G. Harding died of a heart attack in a San Francisco hotel. For a time the fact that "Silent Cal" Coolidge was now President made little difference to the business on  K Street. But inevitably, when dealing with crooks, somebody eventually got greedy again and screwed things up, again. 

This time it was Jess Smith's ex-wife, Roxy Stinson. Cheated out of what she thought was her fair share of Jess' share, Roxy spilled her guts to a Senate investigating committee, and on March 28^th, 1924, President Coolidge demanded Daugherty's resignation. Daugherty decided to play it tough. "I wouldn't have given 30 cents for the office of Attorney General, but I won't surrender it for a million dollars." Then he added, “I have no personal feeling against the President. I am yet his dependable friend and supporter." And then he resigned.

In June of 1924, Gaston Means (above, center) was sentenced to four years for perjury. Once out of prison he wrote a book, “The Strange Death of President Harding”.

It was an instant best seller, a well written inventive concoction of half truths and fantasy. Still desperate for money, in 1932 Means claimed to have been contacted by the kidnappers of the Lindbergh baby. He was arrested after stealing the supposed $100,000 ransom, and sentenced to fifteen years. He died of a heart attack in Leavenworth Prison, in 1938.

Howard Mannington died in 1932, at the age of 64, of a "lingering illness". Henry Daugherty (above) was indicted in 1926 for accepting bribes. The jury deadlocked, 7-5 in favor of conviction. His second trial ended in another hung jury, this time 11 – 1 for conviction. But the government gave up.

In 1932 Daugherty published his own book, “The Inside Story of the Harding Tragedy.” It did not sell well. In October of 1940 Henry suffered two heart attacks which left him bedridden. He died in his own bed on October 12, 1941, a very rich man. And, as far as he was concerned,  that was the point..

Now, the Little Green House on K Street was vacant again. The graft it had contained certainly did not end. It just got bigger and more professional.

- 30 -

K Street - Chapter One

 

I blame the current isolation of the American government on John Dickinson, one time President of Pennsylvania. On the morning of 20 June, 1783, some 400 long suffering veterans of the Continental Army surrounded Independence Hall in Philadelphia and refused to let the Congress out, until they had voted to give the soldiers' their back pay.  The politicians negotiated their way out of this difficulty without parting with any money. But this effrontery by working stiffs directly petitioning their government so angered Alexander Hamilton that he dispatched a note to Dickinson, demanding that he call out the state militia to arrest the veterans.  Dickinson refused.

So, like a boarder sneaking out on the rent, overnight, the Continental Congress slipped across the Delaware River to Princeton, New Jersey, just to avoid paying the debts, both monetary and moral. And for the next 13 years the American government wandered the eastern seaboard avoiding debt collectors, both foreign and domestic.  And to prevent that from ever happening again, in 1800 they built their own city, where they had to ask no one's permission to arrest people trying to hold them accountable. And thus was born the Federal District of Columbia, and the city of Washington, as a direct of result of the lesson taught by John Dickinson – that government, like many people, provides justice only when forced to – or when it is to their advantage.

There was already a town in the new district, called Funkstown.  But that village disappeared after the owner, Jacob Funk, was paid off - unlike those Continental soldiers. Thus Washington D.C. was founded on the principle of payoffs to the land owners, and a cold shoulder to the working stiffs. Pierre L'Enfant designed the nation's capital on the square, ten miles on each side. But geographic reality required that it be balanced for all time on one corner. There were named avenues running North-west to South-East and lettered streets (minus the letter  “J”) running East-to-west, starting with “A” along the Potomac. The entire lopsided place was lorded over by the Capital, perched proudly atop Jenkins Hill.

Oddly, the plan for the city had no space set aside for the sinew and sweaty realities that make all cities possible. In the 18^th century that meant fetid livestock yards, noisome smithies, reeking slaughter houses, putrid tanneries and malodorous glue factories. The 19^th century added the town's rancid gas plant, surrounded by mounds of sooty black coal, fed into belching steam engines producing puffing clouds of black soot right into the center of town. The reeking vaporous working class neighborhood where all that stink eventually settled was almost a mile from the capital, but a mere two blocks from the White House, which showed how low  the founding fathers placed the chief executive  on the social totem pole.  The constant clouds of vile vapors gave a fitting  nickname to this sorry section of town - Foggy Bottoms.

But the expansion of Washington and its government by the Civil War brought gentrification to Foggy Bottoms, driving the stink further out, into Maryland and Virginia. Thus, after mid century,  the Bottoms' primary artery, K Street, could stretch its golden mile from Washington Circle on the west to Vernon Square on the east, with nary a sniffle or a gag between. And in 1880, along the very center of that route, between 16^th and 17^th streets, adjacent to an alleyway, Mr. J.B. Edmonds, decided to build himself a house.

Edmonds told people he was a retired banker, and he was. But he was also a land developer from Clay County, Iowa. He had been the first mayor of the county seat of Spencer,  Iowa, so he was no stranger to politics, either. Just the year before he had also begun publishing a magazine called “The Owl”, which promoted immigration and farming into western Iowa. All things considered I would say it seems unlikely that the 35 year old Edmonds had moved to Washington to retire, as he claimed. He had been proffered a job in the President Chester A. Arthur administration as one of the three commissioners who ran the district. It was one of those jobs that Dickinson had taught the government it needed for its own protection.  But in truth I suspect Edmonds had come to Washington to pursue an active career as a lobbyist. He just had too much pride to admit such a disingenuous occupation in public.

His brand new three story Victorian house at 1625 K Street (above), complete with servant's quarters in the attic, and faced with a green sandstone, had cost him $17,000, the equivalent of almost half a million dollars today. So it seems that whatever Edmonds' s endeavors in the nation's capital were, they paid very well.  Edmonds lived in his home until his death at the age of 55, in 1901.

His widow, Lydia, held onto the property, but she rented the house out to the newly elected Senator from Maryland, "Fighting" Senator Louis Emery McComas, (above) and his wife. He proved to be an honest politician and thus a one term Senator.  However he had earned the respect of some, and in 1905 President Teddy Roosevelt appointed him to the Washington, D.C., District Court of Appeals. Two years later Senator McComas was dead, and Lydia moved back into the Little Green House on K street.

The City of Washington began the first decade of the 20^th century with 279,000 residents, two thirds of whom were described as “white”. People then still expected to live within walking distance of where they worked. In 1900 there were only some 8,000 automobiles and just 10 miles of paved roads in the entire country. That year there were 96 people killed in automobile accidents nationwide - compared to 115 Lynchings. But by 1906 enough automobiles had arrived that the District felt required to establish a top speed limit of 20 miles an hour on city streets. And in 1907 the District of Columbia issued its first license plate. That change was happening became evident in 1910 when there were only 76 lynchings nationwide, compared to some 1,700 deaths in automobile collisions.

By 1910 Washington, D.C. had grown to 331,000 people, still mostly white. Nationwide, over that decade, life expectancy had increased by about a year. Salaries had risen from an average of $670 a year (for a 59 hour work week) to $750 a year. And there were still over 2 million unemployed in America.

And then there came the leap year of 1912. That was the year New Mexico and Arizona became states. It was the year that 30,000 textile workers staged the Bread and Roses strike in Lawrence, Massachusetts.  It was the year that first lady Helen Taft planted the first cherry tree in Washington. It was the year that the United States Marines pulled off a triple play, invading Honduras, Nicaragua and Cuba. It was the year the Titanic sank off of Newfoundland. And that November Teddy Roosevelt and Taft split the Republican vote and allowed the Democrat, Woodrow Wilson, to be elected President. Thirteen days after that election day, on  18 November 1912, Lydia Edmonds died in the little green house on K street. She left behind an estate valued at half a million dollars, equal to $11 million today. It would appear that being a lobbyist paid really well, even in the 19^th century.

In the new century, using that same little green house on K street as a balancing point, lobbyists were going to reach new heights of wealth and influence, on their way to establishing a government of the lobbyists, by the lobbyists, and for the lobbyists.

- 30 -