Those Angry Days

by Lynne Olson

  Another tactic used by the FBI, BSC, and private interventionist groups was to place agents inside America First and other isolationist organizations. By all accounts, the Anti-Defamation League, under the direction of its New York counsel, Arnold Forster, was particularly skilled at such work. “When it came to the radical right,” one historian noted, “Forster had one of the best intelligence gathering operations in the country, with spies everywhere.”

  During the 1930s and early 1940s, the Anti-Defamation League penetrated such organizations as the German-American Bund, America First, the so-called mothers’ organizations, and the offices of a number of isolationist members of Congress. The purpose of the surveillance, Forster said, was to find out whether the groups and individuals “were giving aid and comfort, wittingly or otherwise, to the anti-Jewish, pro-Nazi cabal within our borders.”

  One of ADL’s most successful operatives was a New Yorker named Marjorie Lane, who, like most of the organization’s agents, was not Jewish. For several years, Lane worked undercover as a volunteer for a number of extremist women’s groups, with names like “Women for the USA” and “We the Mothers Mobilize for America.” During the day, she would type, answer phones, and welcome visitors at these organizations’ offices; at night, using a miniature state-of-the art camera, she would photograph incriminating letters and documents. Forster passed all such material along to the FBI and BSC, as well as to friendly columnists like Drew Pearson and Walter Winchell. Indeed, Forster was so close to Winchell that he frequently ghostwrote columns for him about the anti-Semitic right.

  In their investigations of America First, none of the group’s adversaries turned up clear-cut evidence of direct links between its leaders and Germany. Nonetheless, in other ways, the organization proved susceptible to the charge by interventionist organizations that it was “a Nazi transmission belt.” Several of its most active speakers were found to have ties with the German government, prominently including Laura Ingalls, a record-breaking aviator second only to Amelia Earhart in celebrity. The daughter of a wealthy New York businessman, Ingalls in 1935 became the first woman to fly nonstop between the two U.S. coasts. The year before, she won the Harmon Trophy as the most distinguished woman pilot of the year.

  Ingalls’s fame, however, turned to notoriety when she flew over the White House in September 1939 and showered it with antiwar pamphlets. An ardent isolationist, she was a frequent speaker at America First meetings and rallies; it was later revealed that she received money from the German embassy in Washington to do so. Her main contact at the embassy—a Nazi operative named Baron Ulrich von Gienanth—was said to have told her: “The best thing you can do for our cause is to continue to support the America First Committee.” In 1942, she was arrested by the FBI for failing to register as a German agent and sentenced to two years in prison. Although America First leaders argued that the pro-German activities of Ingalls and a few other members “should not be magnified out of their proper proportion,” there’s no question that the organization helped create its own problems in this regard by its less than rigorous attempts to weed out such people.

  A number of isolationist legislators proved to be equally easy targets. In 1940 the British uncovered a scheme, masterminded by George Sylvester Viereck, to arrange free mass mailings of antiwar and anti-British speeches and other material, using the franking privilege of congressional isolationists.

  According to Congress’s franking rules, members were permitted to send out their own speeches and other excerpts from the Congressional Record, the official account of Capitol Hill debates and other proceedings, without paying postage. They also were allowed to send bulk packages of franked articles to a third party, who then could address them and mail them for free.

  As BSC told the story, Viereck had befriended George Hill, a low-level staffer working for Rep. Hamilton Fish, who arranged for isolationist speeches given by congressmen and senators to be inserted into the Congressional Record and then reprinted. Thousands of those reprints were bought by the Committee to Make Europe Pay Its War Debts and other German-backed groups, which then bundled and sent them to other parts of the country. There they were mailed out to hundreds of thousands of Americans on a wide variety of mailing lists. In the words of BSC’s official history, “It almost seemed as if Congress were being converted into a distributing house for German propaganda.”

  In early 1941, the British used American surrogates to bring the franking operation to public attention. Fight for Freedom also joined the campaign, accusing Burton Wheeler, Gerald Nye, Hamilton Fish, and other members of Congress of knowingly allowing their franking privileges to be used by pro-German and anti-Semitic groups. A few months later, Viereck was arrested, convicted, and sent to prison for failing to give sufficient information about his activities when he registered as a foreign agent with the State Department. George Hill, meanwhile, was indicted for perjury by a federal grand jury for lying when asked about his relationship with Viereck.

  The government, however, took no legal action against any of the congressmen and senators whose franks were used. In a Justice Department report issued after the war, John Rogge, a government attorney investigating the case, cited four legislators, including Fish and Senator Ernest Lundeen, as having actively collaborated with Viereck in the franking operation.* Rogge listed twenty other members of Congress, including Nye and Wheeler, as having been “used” by Viereck. There was no evidence, he said, that any of the twenty knew that Viereck was behind the scheme or that German funding was involved.

  Fish, Wheeler, Nye, and others took to the floor of Congress to defend themselves; all said they were innocent of wrongdoing and defended their use of the frank. “Members of Congress, who are in opposition to the administration’s views, would have very little if any opportunity to get their views before a large segment of the population” if it were not for their ability to send out franked material, Wheeler declared. Fish, for his part, said the furor was an effort to “smear” those trying to keep America out of the war.

  However innocent the legislators may have been in legal terms, the franking scandal cast a shadow over their integrity and patriotism from which they never fully recovered.

  LIFE WAS ALSO BECOMING considerably more difficult for Hans Thomsen and his German colleagues in the United States. Embassy staffers were now under close surveillance by the FBI, as were the Reich’s employees in New York and other U.S. cities. In Washington, German diplomats were frequently ostracized at embassy and other social functions. In a message to the German Foreign Ministry, Thomsen complained of an “ever-widening hate campaign against Germany,” adding that “the government of the Reich and its official representatives [are being presented] as Public Enemy No. 1 to American public opinion.”

  Even Friedrich von Boetticher was having problems. The German military attaché had long believed that the anti-British, antiwar viewpoint of his circle of friends in the War Department would eventually emerge as administration policy. But it was increasingly apparent, much to his dismay, that he had miscalculated. Some of his American friends were now shying away from public association with von Boetticher; it was too impolitic to be seen with him. At the order of General George Marshall, von Boetticher’s practice of turning over Luftwaffe telegrams and other reports, with their inflated estimates of German capabilities, to Army intelligence was also discontinued.

  On June 16, 1941, the Roosevelt administration ordered the expulsion of all German consular officials in the United States, along with the staffs of several German news, propaganda, and commercial agencies, claiming they were involved in “activities incompatible with their legitimate functions”—i.e., espionage. Thomsen, however, attributed the expulsions to the “dilemma in which the American Government finds itself regarding the urgent calls for assistance from England. Inasmuch as they are not ready, for the time being, to produce more concrete war aid … they proceed with strong words and deeds against the Axis Powers.”

  Berlin retal
iated by ordering the expulsion of all personnel in U.S. consulates in Germany. Yet Hitler did not break off diplomatic relations with America: the German embassy in Washington remained open, as did the U.S. embassy in Berlin. “Despite these new aggressive measures,” the Ministry of Propaganda declared, “the Reich government is not going to yield to provocations.”

  Then, one month after the expulsion of the German government employees, the FBI arrested more than two dozen people, most of them German-born U.S. citizens, on charges of spying and sabotage. This was Thomsen’s worst nightmare. He had repeatedly begged Berlin not to send spies or saboteurs to the United States, writing that “I cannot warn too urgently against this method” and that “these activities are the surest way of bringing America into action on the side of our enemies and destroying the last vestiges of sympathy for Germany.”

  While the Foreign Ministry sympathized with Thomsen, it informed him that the German army’s intelligence division, the Abwehr, had “compelling military reasons” for collecting information in the United States and would continue to do so. In fact, it had been doing so for most of the 1930s, with considerable help from American companies, which had no compunction, at least until 1940, about selling to the Germans such vital military devices as automatic pilots, gyro compasses, and even control systems for antiaircraft guns.

  Thomsen had good reason to complain about the Abwehr agents and those from other German intelligence agencies operating in America. For the most part, they were terrible at their jobs. Their operations, Thomsen wrote his superiors, were “marked by naivete and irresponsible carelessness, and on top of that, lacked any kind of coordination.”

  In all their years of prewar spying, German agents could boast of only one notable success: acquisition of the plans for the Norden bombsight, a revolutionary technological development that made it possible for bombardiers to hit industrial targets with surgical precision. In 1937, Hermann Lang, a German immigrant working at the Norden plant in Manhattan, turned over blueprints he had copied to Nikolaus Ritter, an Abwehr major based in the United States. The plans were smuggled aboard a German ocean liner and taken to the Reich, where engineers used them to construct their own version of the bombsight. In the end, however, the device proved to be of no value to Germany. The Luftwaffe decided not to use it, much preferring its own bombsight, which was already in production and was familiar to its bombardiers.

  Two years after Lang approached him, Ritter acquired another promising recruit—a German-born U.S. citizen named William G. Sebold, who was traveling to visit his mother in the Ruhr when the Gestapo coerced him into working as a spy. Taken on by Ritter, Sebold was sent to an Abwehr spy school in Hamburg. At the end of his training, he was given a false name and forged passport, then was dispatched to New York as a radio operator, responsible for sending back to Hamburg the reports of several Abwehr agents living in the area.

  Sebold, whose German code name was “Tramp,” proved to be so good at his job that the Abwehr asked him to transmit messages from a number of other agents, including Hermann Lang. He did so, setting up an office in the Knickerbocker Building in downtown Manhattan as a meeting place for the twenty or so spies whose intelligence he was to relay back to Germany.

  Unbeknownst to the German operatives, their conversations with Sebold about their past feats and future plans were being recorded by FBI bugs and cameras. Sebold, the ace radio operator, was, as it turned out, a double agent, who had approached American officials in Germany as soon as the Gestapo suborned him and had worked with the FBI from the moment he arrived back in America. His messages to Germany had actually been transmitted by FBI agents, who eliminated any material that might have been damaging to U.S. interests and who also passed along disinformation to the Abwehr. The incoming messages from Germany alerted the FBI to future Abwehr intelligence targets and the recruitment of new operatives.

  Among the spies swept up in the July 1941 arrests was Hermann Lang, who, together with his cohorts, was found guilty of espionage and sentenced to a long term in prison. William Sebold was the chief government witness at their trial.

  The spy sweep was a debacle for Germany, a point underscored by an exasperated Hans Thomsen in an “I-told-you-so” cable to Berlin: “Most, and probably all, of the persons involved in this affair were totally unqualified for operations of this kind.… It can be assumed that the American authorities had long known all about the network, which certainly would not have been any great feat, considering the naïve and sometimes downright stupid behavior of these people.”

  Yet the ineptness of the German agents and their lack of success went largely unmentioned by the FBI when it trumpeted to the American public its success in breaking up the spy network. At one point, Hoover noted privately that Germany “today relies far more on propaganda than on espionage.” According to Attorney General Robert Jackson, “the Nazis never had an extensively organized espionage or sabotage ring in this country.”

  Indeed, the United States never faced any serious threat of internal subversion before or during the war. But the American people never knew that; in fact, they were told the opposite. According to the FBI and the White House, the roundup of the German spies was incontrovertible proof that swarms of fifth columnists and enemy agents were busily at work throughout the country.

  AS IT HAPPENED, THE Germans were not the only targets on J. Edgar Hoover’s hit list in the summer of 1941: he was also gunning for his erstwhile allies, William Stephenson and the BSC. Despite all the help that the British had given the FBI, including providing some of the evidence that convicted the German spy ring, the relationship between Hoover and Stephenson had begun to unravel. The FBI chief became increasingly concerned that the British were getting involved in activities that, by rights, should be carried out by the bureau. He was, for example, greatly displeased by the espionage activities of the BSC operative Amy Pack, keeping her under constant surveillance and tapping her phone. Hoover also was upset by Stephenson’s role in helping to set up the Office of Strategic Services, America’s first centralized intelligence agency, which Hoover regarded as a rival to the FBI.

  Virtually from the day he arrived in the United States, Stephenson had championed the creation of an American entity similar to the BSC, with which he and other British intelligence officials could collaborate in planning covert activities against the Axis throughout the world.

  OSS director William Donovan decorates spymaster William Stephenson, head of the wartime British Security Coordination, with the Medal of Merit, America’s highest civilian award at the time, in a postwar ceremony.

  His American partner in the venture was William Donovan, a multimillionaire Wall Street lawyer who had been assistant attorney general in the Coolidge administration and, before that, a much-decorated hero in the Great War. An officer in the Army’s famed “Fighting 69th” regiment, Donovan, who acquired the nickname “Wild Bill” for his wartime exploits, had been awarded the nation’s three highest medals for valor, including the Medal of Honor. He was a close friend and political ally of Frank Knox, who prevailed on Roosevelt in 1940 to send Donovan on several secret missions to Europe and the Middle East, including one to Britain to determine if that nation would continue to survive. Donovan, who was a member of the Century Group, reported back to FDR in the affirmative and urged the immediate dispatch of all possible aid to the British.

  Having met Donovan during the Great War, Stephenson contacted him as soon as he arrived in America, and the two quickly formed a close personal and professional relationship. To their mutual associates, the tall, husky Donovan became known as “Big Bill,” while the short, slender Stephenson was “Little Bill.”

  Until 1941, America’s intelligence-gathering functions had been scattered among several government agencies, including the FBI and the War, Navy, and State Departments. With Stephenson’s help, Donovan persuaded Roosevelt in July of that year to establish a new organization called the Office of Coordinator of Information (COI) and to make
him its head. The forerunner of the Office of Strategic Services (OSS), the COI was created not only to collect intelligence against U.S. foes, real and potential, but also to carry out subversive propaganda and sabotage operations, thus acting as the American counterpart of BSC.

  From the day of its inception, Stephenson served as the COI’s godfather, helping to set up its headquarters and field operations, providing training facilities and instructors for its agents, and passing on to Donovan “a regular flow of secret information … including highly confidential material not normally circulated outside the British government.” As Donovan himself later acknowledged, “Bill Stephenson taught us all we ever knew about foreign intelligence.”

  In London, Desmond Morton, Churchill’s liaison officer with British intelligence, wrote: “A most secret fact of which the Prime Minister is aware but not all other persons concerned, is that to all intents and purposes U.S. Security is being run for them at the President’s request by the British.… It is of course essential that this fact should not be known in view of the furious uproar it would cause if known to the isolationists.”

  The close relationship between Stephenson’s and Donovan’s operations was, of course, no secret to J. Edgar Hoover, who was as enraged as any isolationist might have been. He not only deeply resented the establishment of a rival intelligence organization, he also despised Donovan, who felt much the same about him. The two had clashed repeatedly in the early 1920s, when Donovan served as assistant attorney general. At one point, Donovan urged Attorney General Harlan Stone to fire Hoover. Stone ignored the recommendation, and Donovan acquired a powerful lifelong enemy.

  In his battle against BSC (and, in effect, Donovan), Hoover enlisted the aid of a potent ally—Assistant Secretary of State Adolf Berle, the State Department’s intelligence liaison with the White House, FBI, and other information-gathering units within the government. One of Roosevelt’s original brain trusters, Berle, a former law professor at Columbia University, was both antiwar and anti-British, denouncing what he called the British record of “half truths, broken faith, and intrigue behind the back of the State Department and even the President.”