The Chief

by David Nasaw

  In June, the Hearst corporate treasurer had estimated that the Chief required $803,633.06 (about $9.5 million in today’s money) for the remaining six months of the year. Forty percent of this was to be set aside for federal and state taxes, another $120,000 for Mrs. Hearst, and another $167,000 for debt payments, interest, and insurance. This left the Chief with less than $175,000 for personal expenses, out of which he would now have to finance everything the corporation refused to pay.40

  Construction ceased entirely at San Simeon and Wyntoon. So did much of the partying. Mel Engle, a waiter, recalled in his oral history that after 1937 there were never more than ten to fourteen guests on the hilltop; according to George Loorz, few of them were from the old Hollywood crowd.41

  Word of Hearst’s virtual bankruptcy quickly became public knowledge. On October 11, the New York Times confirmed that the anonymous “gentleman” and “well-known collector” whose silver was being auctioned off at Sotheby’s in London was none other than William Randolph Hearst. Things had gotten so out of hand that even President Roosevelt, in a mid-October meeting with Edmond Coblentz, felt obligated to offer business advice to the Chief: “Please tell W. R. I advise him to get rid of his poorest papers, to print more news, not to print so many features, keep just the good ones, and to kill his editorial page. Tell him to use it for the good features and to print only an occasional editorial on [>].”42

  Judge Shearn, now firmly in control of the Hearst empire, assembled his own team to run the corporations. He selected Chase National Bank’s law firm, Milbank Tweed, as counsel, and tried to raise cash as quickly as possible by, among other measures, selling off the art collections that had been bought and paid for by the Hearst corporations. Rather than spend years trying to sort out what the Chief had paid for out of his own pocket and what had been bought with corporate funds, Shearn and his financial advisers divided his holdings in half, generously allocating $11.5 million worth of art and antiques to Hearst personally and the same amount to International Studio Arts Corporation, the subsidiary of Hearst’s holding company through which he had paid for his art. Hearst was advised that he could have any item that belonged to the corporation if he substituted for it an item of equal value of his own.43

  Before anything could be sold, the contents of San Simeon, Wyntoon, Millicent’s Sands Point estate, the Clarendon, St. Donat’s, the Ritz Tower, and warehouses in the Bronx, in Manhattan, at San Simeon, in Northern California near Wyntoon, in San Francisco, and in Los Angeles had to be inventoried, catalogued, arranged into lots, and priced for sale. (It was assumed, generously, that none of the contents of Marion’s beach house had been paid for with corporate funds.) Teams of experts sorted through Hearst’s holdings on two coasts and two continents and segregated them into fifteen discrete collections: Armour; Tapestries; Paintings; Furniture; Gold and Silverware; Art Objects; Pottery, China & Glassware; Buildings and Parts; Autographs, Manuscripts and Original Drawings; Stained Glass; Miscellaneous Hangings; Jewelry and Precious Stones; Flags and Banners; Rugs, Mats, etc.; and Indian Objects.44

  No one, except for Hearst himself, had had any idea of the magnitude of his holdings until the classification and liquidation process began. The press had visited and written about San Simeon and the Bronx warehouses, but no one knew that there were tapestries, carpets, textiles, and hangings in storage at the Lincoln Warehouse on Third Avenue in Manhattan between 69th and 70th Streets, or that at St. Donat’s alone there were major collections of furniture, paintings, sculpture, bronzes, wooden objects, tapestry, needlework, silver, pewter, brass, gold, glass, china, porcelain, stained glass, clocks, ironwork, and arms and armor.

  Hearst’s advisers and consultants were uncertain as to how to proceed. If they put everything on the market at once, the glut would be such as to depress prices on two continents. They decided to sell the collections in stages. After nine months of sorting, cataloguing, and pricing, it was announced in early March of 1938 that selections from the Hearst collections would be placed on sale and that Macdermid Parish-Watson of East 57th Street had been engaged to oversee the process.45

  The first sales were arranged privately. John D. Rockefeller, Jr. bought $100,000 of silver to exhibit at the Governor’s Palace in colonial Williamsburg; a British shipping millionaire purchased several hundred thousand dollars worth of Gothic tapestries in London. Parish-Watson reported to A. J. Liebling, who visited him for a New Yorker article, that he had discovered that there was, indeed, a market for everything. On a recent trip to London, he had been able to sell “two nineteenth-century German paintings of a Tyrolean dance ... a type of genre painting long out of favor.... A London dealer got them ... for a good price—probably, Parish-Watson thought, for the account of Field Marshal Goering.”46

  When the dealers and private collectors had placed their bids, Parish-Watson opened the Hearst collections to the public. A New Yorker cartoon from November 5, 1938, pictured a fat businessman in bowler hat, in front of a San Simeon—like castle, telling his companion, “My wife snapped it up at a Hearst sale.” First editions, manuscripts, autographs, historical blue Staffordshire ware, and some early American furniture were consigned to Parke-Bernet for auction in New York. The silver from St. Donat’s was auctioned off by Christie’s and Sotheby’s in London. In mid-November, just in time for the Christmas buying season, M. Parish-Watson opened to the public “a cross-section of the William Randolph Hearst collection, ranging from pre-Christian art to that of the eighteenth century ... in a five-story building leased for the purpose at 46 East Fifty-seventh Street.”47

  For the next two years, the sales and auctions continued in full force. Some items were sold privately through dealers, others publicly through the auction houses and the 57th Street galleries operated by Parish-Watson. Though only a portion of Hearst’s collection was for sale, Parish-Watson estimated that, in the end, the complete catalogue would encompass close to 250 volumes.48

  None of this was easy on Hearst. He was especially grieved to have to part with his treasures, even those he had seen only in photographs. Though the final decision-making was out of his hands, he was consulted on every sale and asked to verify the authenticity of questionable pieces. In the cartons of correspondence still stored at the Hearst Corporation’s Bronx warehouse, there are dozens of letters from Tom White in New York to Hearst at San Simeon or Wyntoon—White imploring Hearst to accept the price offered for a particular item, the Chief reluctant to let it go. In May of 1938, to cite but one example, Hearst turned down an offer of $4,000 for a pair of fifteenth-century brass candlesticks at Millicent’s Sands Point estate and asked that they be shipped west to San Simeon. With dozens of other items of business to transact and railroad cars full of artwork being transported back and forth between California and New York, the candlesticks were soon forgotten by all but the Chief. When he discovered in October that they had been sold, he telephoned White to demand that they be bought back. When the dealer who had sold the candlesticks refused to return them without an additional $1,000 to cover the profit he had made on the sale, Hearst demanded that he be barred from doing further business with the corporation.49

  34. “All Very Sad, But We Cannot Kick Now”

  A S IF NOTHING HAD CHANGED, though everything had, Marion celebrated Hearst’s seventy-fifth birthday with a costume party. The theme was American History. Hearst came dressed as President James Madison and smiled broadly for the camera, an Italian countess dressed as an Indian maiden at his side.

  Despite the bright lights and the smiles at the beach house that evening in April 1938, his and Marion’s world had collapsed and would not easily be put back together again. The Chief had lost control of his empire, the star had retired from moving pictures.

  In her memoirs, Marion claims that she left Hollywood not only because she had grown weary of making movies, but because she felt that W. R., now in his middle seventies, “needed companionship. He was having some financial troubles at the time, too, and he was more upset than p
eople realized. I thought that the least I could do for a man who had been so wonderful and great ... was to be a companion to him.”1

  As Hearst’s financial problems mounted, he had begun to look to Marion for solace and counsel. Their roles were neatly reversed. It was she who watched and worried and reassured; she who had found the money to keep “Pops” afloat through bad times. Gretchen Swinnerton, the wife of Hearst’s cartoonist and friend Jimmy Swinnerton, recalled that “at Wyntoon, when Mr. Hearst would go out and take a walk alone in the woods ... Marion would sit there just as nervous as a cat till he showed up again, afraid something had happened to him. He might have fallen or something. Every minute, apprehension—where was he? Was he all right?—unless she was with him. She adored that man.”2

  Hearst worried about Marion, as he always had. Now retired, she had less reason to remain sober and was drinking herself to death. W. R. tried tenderness, anger, offers to send her anywhere in the world to take any cure. “A couple of years ago,” he wrote the editor of his American Weekly in the summer of 1940, “there was a small article ... about a doctor who had cured the liquor habit with sugar and yeast. I suggested at the time that you make a page article on this question and on his method, because I thought it was interesting. If you cannot get the page article, will you please at least get a plan and specific prescription for his method to be used on a patient, either directly or through another doctor. If he prefers through a doctor I would advise Dr. Dickinson, of McCloud, California [the town nearest Wyntoon]. At any rate, some way or other, please get the data and oblige.”3

  Hearst tried to restrict Marion’s access to liquor, but like all alcoholics, she found new sources to replace the ones he closed off. “She always had me leave her water goblet empty so when I served wine, I filled her water goblet with wine,” Mel Engle, who waited table at San Simeon from 1939 to 1940, recalled. “She would dump it down her throat, and back down she’d go for the second time before I got by. She was pretty bad as an alcoholic, and when she’d drink, eventually she would make an ass of herself at the table, start acting up, making noises and things. It wasn’t unusual for Mr. Hearst to ask her to be taken from the table.”4

  Fearful that Marion might hurt herself, Hearst hired a succession of nurses to watch over her. But they too succumbed to her requests for liquor. Charles Gates, who became Hearst’s chief butler in 1939, admitted that he had supplied Marion with liquor bottles: “Well, we sort of gave them to her. After all you know you’re working for the person, you got to treat them, if they ask you for something.”5

  While Hearst commuted back and forth between San Simeon, Los Angeles, and Wyntoon, Judge Shearn in New York continued to sell off his assets to pay off his debts. Had the economy recovered, as Hearst had been expecting since 1929, Shearn’s task might have been easier. Unfortunately, Roosevelt’s 1937 retreat from his public works projects had resulted in a nationwide recession. In August of 1937, the stock market began to fall again. By March of 1938, unemployment was back at 20 percent. Worse yet for the newspaper industry, newsprint prices were soaring while advertising revenues fell.

  On June 1, 1938, Shearn announced that Hearst Consolidated, which through the worst of the Depression had always paid its 7 percent dividend, was deferring payment on the next quarter’s dividend because advertising revenues had decreased from $15 million to $12 million and income for the first four months from $2.6 million to between $600,000 and $700,000. With the corporation in desperate need of cash to pay its outstanding obligations, Hearst was called back to New York City to sign off on a new credit agreement with Chase National Bank and the Canadian paper mills that would have ceded full control of his empire to an executive of Chase National Bank and a representative of the Canadian mills and tied the publications to a long-term contract with the Canadian mills.6

  Judge Shearn was in an impossible position. As revenues continued to fall through 1938, he was forced to defer three successive dividends because he could not come up with the cash to pay them. According to the terms of the 1930 offering, if the company missed its fourth consecutive dividend in March of 1939, this would trigger a corporate reorganization with the stockholders gaining the authority to elect a new board of directors. Shearn and his chief advisers flew out to meet with Hearst at San Simeon to apprise him of the situation. Then, at the very last minute, they secured another loan from Chase to pay off the March 1939 dividend.7

  It was now clear that Shearn had failed to stabilize the corporation’s finances. Both Hearst and Jack Neylan, whom Hearst had begun to consult again, tried to wrest control from him. Neylan proposed a reorganization plan that would have replaced Shearn with three independent trustees. The Chief, after intimating that he would support Neylan’s plan, came up with one of his own, which would have effectively returned all corporate power to him and moved the corporate offices to Los Angeles. Although Shearn appeared to have signed off on Hearst’s plan, it was doomed from the start. What the Chief was unable or unwilling to recognize was that until the corporation had paid off its debts, the creditors, not Shearn or Neylan or William Randolph Hearst, would be making the decisions.8

  “W. R. has blundered again,” Neylan wrote Alice Head on March 14, 1939. “By attempting to put himself back in command, he has provoked the newsprint creditors into installing an executive of their choosing, with practically autocratic power.... The most disheartening thing of the whole situation is the fact that he has no realization of his own status.... The tragic fact is that in these days he can no more understand what is necessary to rehabilitate himself than he could understand in the old days that his extravagance and improvidence could bring him to disaster.”9

  As Time magazine reported in its March 13, 1939, cover story on Hearst, Shearn had saved the old man’s empire from bankruptcy, but in the process he had reduced it to a shadow of its former self:

  For 17 years millions of U.S. citizens, to whom Hearst has been an institution as well as a legendary figure, have wondered what would happen to the institution when William Randolph Hearst was no more. Of late they have ceased to wonder, have realized that the institution has already started breaking up before their eyes.... Just how far the public thinks the Hearst empire has progressed toward dissolution is neatly summed up in this lyric currently sung on Broadway by Funnyman Jimmy Durante:

  Mr. Hearst tries to sell me a paper,

  But dat don’t fit in wid my plan

  I said I will buy a paper from you

  If you buy a pencil from me—

  I’m just a self-made man.

  Though the subject of the article was Shearn’s corporate reorganization, the face on the cover was that of a pensive Hearst, his head tilted slightly downward, staring off into the distance. According to Time, the old man was finished forever and knew it. The directors of Hearst Consolidated scurried about in New York to raise money. When Tom White flew to Los Angeles to beg Harry Chandler of the Los Angeles Times not to call in the $600,000 mortgage he held on San Simeon, Hearst, Time reported, was “with Marion Davies, at her Santa Monica beach house.... No longer ruler of the empire he built, Hearst has only two desires concerning it: 1) to have some of it survive him; 2) to keep his job.... At age 75, the bad boy of U.S. journalism is just a hired editorial writer who has taken a salary cut.”10

  The Hearst mythology was undergoing yet another shift in emphasis. He was no longer looked upon as a menace to the republic, but rather as an eccentric millionaire, struggling to retain some portion of his past glories. Aldous Huxley, who had written for the Hearst papers in the early 1930s, moved to Hollywood in 1937. Though ostensibly employed at MGM, he spent much of his time—and all of his creative energies—on After Many a Summer Dies the Swan, a brilliantly satiric novel about Los Angeles. Huxley chose to place a highly eccentric millionaire, modeled on Hearst, at the center of his Hollywood novel. Jo Stoyte lives with his mistress in a castle, as did Hearst, but unlike him is obsessed by the fear of death and has hired Dr. Obispo to find the secret of
eternal life for him. The book opens with the visit of an Englishman, Jeremy Pordage, to Stoyte’s castle:

  About half a mile from the foot of the mountains, like an island off a cliff-bound coast, a rocky hill rose abruptly, in places almost precipitously, from the plain. On the summit of the bluff and as though growing out of it in a kind of stony efflorescence, stood a castle. But what a castle!...The thing was Gothic, mediaeval, baronial—double baronial, Gothic with a Gothicity raised, so to speak, to a higher power, more mediaeval than any building of the thirteenth century.... He had known, of course, that Mr. Stoyte was rich, collected pictures, owned a show place in California. But no one had ever led him to expect this.

  Mr. Stoyte, as portrayed by Huxley, was quite as mad as his castle, as was everyone else around him, but his obsessions made him a pathetic rather than a particularly sinister character. There is no evidence—in his public or private papers—that Hearst ever read the book. If he did, he certainly took no action against Aldous Huxley, who continued to live in Hollywood and write for moving pictures. “I heard about Aldous Huxley,” Marion recalled in her memoirs. “I don’t think I ever met him, nor did I read his book, but I wanted to.”11

  With Shearn, at the behest of the banks and the Canadian paper mills, shedding assets as quickly as he could, there was no way of knowing what would be left behind for Marion, Millicent, and the boys. During the summer or fall of 1938, when it appeared likely that all might be lost—including San Simeon—Hearst flew down from Wyntoon for a family reunion with Millicent and the five boys at the ranch. “He was so happy and content,” August Wahlberg, his valet and butler, remembered. “I have never [seen] him that way.... That was a very, very nice event for everybody and he enjoyed it immensely. We were there for about three days.” Randolph Hearst remembers that, before departing their separate ways, W. R., Millicent, and the five boys posed for a picture in front of the castle.12