Politic Oil

A nervous, thin little man from Sullivan, Ind., who steadied his chin on his tall, starched collar and rabbited at his lower lip until it bled, was star witness of the week before the Senate Public Lands Committee, continuing its dredging of the Oil Scandals. He was Will H. Hays, who managed the Harding Campaign as G. O. P. chairman, then landed in the Cabinet as Postmaster General, then became "tsar" of the cinema industry, which lofty office he still fills.

The Committee wanted to ask Mr. Hays more about Oilman Harry Ford Sinclair's contributions to the G. O. P. made in 1923 a few months after Mr. Hays' fellow Cabinet member, Secretary of the Interior Albert Bacon Fall, had bestowed on Sinclair the crooked Teapot Dome oil lease.

Mr. Hays had gone over the same ground with the Committee four years ago, when the Oil Scandals first gushed. At that time, Senator Walsh had said: "Do you know how much he [Sinclair] did give? $75,000?"

And Mr. Hays had answered: "Yes, sir: as a total . . . I think that was the maximum amount, $75,000. . . . His contribution for any amount that he would be obligated for or would pay in any event was a maximum of $75,000."

Last week, Mr. Hays anticipated his cross-examiners with a statement which raised the "maximum" of Sinclair's contributions to $260,000 and the actual net of his gifts to $160,000. Mr. Hays tried hard to explain what looked like, yet may not have been, flat perjury. The explanation was this:

Though out of politics and in cinema in 1923, Mr. Hays felt that he should help "clear the deck" for the impending Coolidge campaign by assisting the G. O. P. to pay off a $520,000 deficit remaining from the Hays-managed Harding campaign. He asked Sinclair to contribute. They agreed that $75,000 was all Sinclair should give. At the same time, until other contributions could be solicited, Sinclair volunteered $185,000 more, to help make the G. O. P. books seem balanced. The money was delivered in one bundle of Government bonds and the total, $260,000, was exactly one-half of the $520,000 G. O. P. deficit. "It was just like a Red Cross drive," said Mr. Hays.

When other contributions turned up, Sinclair received back $50,000 from the G. O. P. then $50,000 more. Then Mr. Hays personally borrowed $85,000 and gave it to Sinclair, thus reimbursing him for all but his initial gift of $75,000, the amount they had agreed was fitting for him to give outright.

"But," said Mr. Hays, "he [Sinclair] did not feel that I should bear this burden personally and he voluntarily returned the $85,000. . . . This last transaction had not taken place when I testified before this committee in 1924."

Nervousness on the one hand, suspicion on the other, made of this story a very long and confused matter indeed when Inquisitor Walsh made Tsar Hays repeat it over & over. Less stigma would have attached but for two circumstances:

1) Asked why he did not report in 1924 that Sinclair had at one time advanced as much as $260,000 toward the G. O. P. deficit, Mr. Hays said, "I was not asked about that."

2) Frederick W. Upham of Chicago who, as treasurer of the G. O. P. in 1923, collaborated with Mr. Hays in meeting the deficit and who received from Mr. Hays the Sinclair money, is dead. There is none now to disprove the hypothesis that the Sinclair money, received in the form of bonds, may have been handed out by Mr. Upham to Chicagoans who marketed the bonds and then made "contributions" to the G. O. P. under their own names instead of Sinclair's.

For the Baltimore Sun, able cartoonist Edward Duffy composed a sooty drawing of a burlesque policeman twirling an enormous stick over the head of a small figure with a derby hat, enormous ears, tight little coat, baggy pants and suitcase shoes at a familiar angle. This figure, whose little bamboo cane was labelled "Will Hays," was tossing aside a bag of boodle and grinning up at the officer with wrynecked, Chaplinesque embarrassment. The cartoon's title was "The Gold Rush."

The Sun pointed out editorially: "Will Hays . . . grossly and flagrantly deceived the Walsh investigating committee . . . on the eve of the Coolidge campaign. There can, then, be no assurance that Hays is not deceiving the Walsh committee now, on the eve of the 1928 campaign."

Old Oil's week was also featured by:

P: The indictment of Col. Robert W. Stewart, board chairman of the Standard Oil Co. of Indiana, for contemptuous refusal to testify to the Senate all he knows about the dubious disposal of the dubious profits of Sinclair's Continental Trading Co.

P: The unanimous re-election of Col. Stewart as a director, by the Indiana Standard stockholders. Stockholder John D. Rockefeller Jr. cast no vote, but offered no censure. Col. Stewart's fellow directors immediately re-elected him as their chairman. Explaining his neutrality, Mr. Rockefeller announced that he was still "seeking the facts . . . and will take such steps in the matter as he thinks proper. Since more than 50,000 other stockholders of the Indiana Company are involved, it is obvious that Mr. Rockefeller must not act precipitately."

P: The resignation of Myron K. Blackmer as Vice President of the Midwest Refining Co. Henry H. Blackmer, his father and Midwest's onetime Board chairman, is a fugitive from justice and the possessor of $763,000 profits of the Continental Trading Co.--money which apparently belongs to the Midwest Co.

P: The elevation of Major Peyton Gordon, U. S. Attorney who has twice convicted Sinclair--for contempt of the Senate and for jury-tampering in contempt of the Supreme Court of the District of Columbia--to the bench of the latter Court, by President Coolidge.