Wild Bill Donovan

by Douglas Waller

  Donovan, who was notorious for losing personal items like wallets, pooh-poohed the theft to reporters, insisting the bag had only his passport and papers of no value to the Abwehr. Angry British and U.S. security officers weren’t so sure. The bag contained a sensitive list of questions from the U.S. Navy for Donovan’s trip. When Bulgarian police finally found the pocketbook and returned it to the embassy, only the list was missing from inside it.

  RUTH AND MARY, in full-length mink coats to ward off the chill, stood at New York’s La Guardia Field Dock for flying boats to greet Donovan on his return March 18, 1941. David was there as well but stayed in the background to avoid the photographers. He did not enjoy New York’s hectic pace. He also did not have good news for Donovan that day. Despite Knox’s intervention, the Navy had just rejected David’s application for a reserve commission (relatives suspected he chose the sea service so he would not follow his father into the Army). David had poor eyesight and the naval reviewing board found his academic record decidedly undistinguished.

  The photographers framed Donovan’s wife and his pretty daughter-in-law in all their shots. Mary liked being in front of the cameras. She wanted more than just a farm life. As free-spirited and assertive as she was stylish and beautiful, Mary enjoyed throwing parties and being the center of attention at them playing the piano. She smoked Lucky Strikes and sometimes shot birds in an elm tree from her bedroom window. To break the tedium of Berryville, she painted floral works, designed jewelry, and often was the leading lady in local productions by the Blue Ridge Players. And unlike her husband, Mary liked the fact that Donovan was a celebrity.

  Donovan had already sent Knox, Hull, and the White House lengthy cables on his findings and recommendations. Roosevelt should erect “a Balkan barrier against Germany,” he urged in one report. Donovan also sent Knox a detailed letter on how London organized its intelligence and unconventional warfare operations. Menzies and British commandos had been even more forthcoming during Donovan’s latest stopover in London. He began forming in his own mind how a new American intelligence operation should be assembled for this war. “It should be headed by someone appointed by the President, directly responsible to him and to no one else,” Donovan wrote Knox. Funding for this unit “should be secret and made solely at the discretion of the President.”

  Roosevelt, who had easily defeated Republican Wendell Willkie four months earlier for a third term, seemed no more preoccupied with the Mediterranean at the moment than Hitler was. He told his scheduler to give Donovan only fifteen minutes in his White House study on March 19 before he headed out on a vacation cruise to Florida. Donovan managed to extract a few minutes extra for a hurried-up pitch on war equipment the British needed in the region. Harry Hopkins, a close Roosevelt confidant not only on domestic policy but also on defense and foreign affairs, sat in on the meeting and cabled Churchill afterward that the White House was “moving rapidly to get [the] materials required.”

  TREASURY SECRETARY Henry Morgenthau Jr., another one of Roosevelt’s closest advisers, liked to convene his daily senior staff meeting at 2:30 p.m. to see who took a long lunch and to begin it by trading the latest political gossip with his aides. Washington on March 20 was chattering about Donovan. Morgenthau, who despised the Nazis and had encouraged Hoover to bug the phones of Axis envoys in the United States, wondered if Donovan was replacing Hopkins as FDR’s favorite private emissary to Churchill. None of the staffers had picked up that morsel.

  Morgenthau thought Donovan was an up-and-comer and had ordered Treasury to give him any help he requested. Donovan had been to England twice, he had met practically every leader in the Balkans and Middle East, and had been “in the trenches” at different fronts, Morgenthau told the dozen young men around his conference table. “I think he knows more about the situation than anybody I have talked to by about a thousand per cent.”

  “That is all good preparation for Washington,” said an aide, chuckling. “He ought to be at home in all the fighting that is going on.”

  Donovan did quickly join the political combat. Armed with talking points the War Department and the British slipped him, he went on the speech circuit and took to the radio airwaves once more, denouncing “defeatists” like famed pilot Charles Lindbergh and pacifists who called for “peace at any price.” But though the country’s mood had begun to shift more toward aiding Britain and he had Roosevelt’s support, Donovan could not escape personal attack. Hate mail over his speeches poured in. The vision he and Churchill had of a united Balkans alliance also soon went up in smoke. Succumbing to German pressure, Boris in Bulgaria had joined the Tripartite Pact on March 1. To squelch a coup Belgrade officers launched to block their government from joining the Axis, the German army invaded Yugoslavia in April. Axis propaganda claimed Donovan had met with one of the Belgrade coup plotters and encouraged the officers to launch their foolhardy revolt. Donovan dismissed the charge as “poppycock,” which it was, but conservative reporters in the United States picked it up and accused him of making promises of U.S. military aid in the Balkans that he had no authority to make.

  J. Edgar Hoover was miffed as well over his European trip. Hoover had already sent two of his best agents to London to review the entire British intelligence setup and had sent their report to the White House two weeks before Donovan had returned home. But now Donovan was running around Washington passing himself off as the first to discover intelligence’s Holy Grail. By any measure Donovan’s European tour had been the most wide-ranging and in-depth that any American had taken up to that point. Hoover, however, sent FDR a report from an unnamed (and hardly reliable) source “close to the German embassy” in Washington. Because Donovan was “not schooled in the art of diplomacy,” his European mission had been a “failure,” Hoover’s report concluded. It would be one of many poison-pen memos soon targeting Donovan.

  Chapter 8

  Spy Service

  DONOVAN HAD PASSED an Army physical in May 1941 so he could command a combat division. But the British kept nudging him into a different direction. Stephenson had been intensely lobbying the Roosevelt administration on the need for a coordinated American intelligence service partnered with the United Kingdom. So had Admiral Godfrey, Britain’s Naval Intelligence chief, and his aide, Commander Ian Fleming. By May both naval officers were guests in Donovan’s Georgetown home. They joined Stephenson in talking up the intelligence idea with him. Forming a new spy service had been in the back of Donovan’s mind. He had the credentials for it, with his military experience and his world travels informally collecting secrets. Donovan told Knox that America, too, needed an organization of spies and saboteurs like Britain’s with “men calculatingly reckless with disciplined daring.”

  Knox pressed Roosevelt on Donovan’s ideas for a new intelligence service, but it soon began to ring alarm bells in other parts of Washington. Hoover and the State Department’s intelligence chief, Adolf Berle, were convinced that Stephenson’s vast operation—it included spying on American opponents of Britain and breaking into hostile embassies—violated U.S. espionage laws. Brigadier General Sherman Miles, the Army’s well-connected intelligence chief, warned the service’s chief of staff, George Marshall, in a memo that Donovan was scheming “to establish a super agency” that would take over the Army, Navy, and FBI spy services. Marshall agreed.

  Roosevelt, however, was interested in Donovan’s ideas. Secretive by nature, even with his closest advisers, FDR had been enamored since his youth with subterfuge and intrigue. Donovan much later would call him “a real cloak-and-dagger boy.” Roosevelt had already set up his own private network of spies because the traditional intelligence system left him so much in the dark on what was happening overseas that it made him physically ill at times. The primitive and parochial intelligence units in the Army, Navy, and State Department were underfunded and undermanned dumping grounds for poor performers. No one was at the top coordinating these separate, often feuding fiefdoms, Donovan realized. No one analyzed the bits and
pieces of information coming in to give Roosevelt a clear picture of events abroad.

  At Roosevelt’s request, Donovan on June 10 sent him a memo, with a crudely drawn organizational diagram enclosed, explaining how he would set up a centralized spy service. “Strategy, without information upon which it can rely, is helpless,” Donovan’s memo began. “Likewise, information is useless unless it is intelligently directed to the strategic purpose.” In other words, information needed to be both collected and used as a weapon. Donovan’s new unit would gather intelligence overseas by itself or through the existing organizations in the Army, Navy, State Department, and FBI. This unit would then be responsible for analyzing the information that came in from everywhere and reporting it in a coherent fashion directly to the president. “But there is another element in modern warfare,” Donovan argued, “and that is the psychological attack against the moral and spiritual defense of a nation.” The other mission for Donovan’s “coordinator of strategic information”: Wage propaganda warfare against the enemy, which he thought the Nazis had “effectively employed.”

  Shortly after noon on Wednesday, June 18, Donovan and Knox walked into the Oval Office to meet with Roosevelt. With Menzies keeping a close watch from London, Stephenson had continued feeding Donovan reports on British espionage while Godfrey had left Fleming behind for advice on fleshing out his intelligence plan. Donovan was well aware of the dangers in depending too much on the British, whose agenda, he knew, did not always jibe with Washington’s. He accepted suggestions from Fleming he considered useful and ignored the ones he thought wacky, such as putting the headquarters of this new organization in the FBI’s offices, Hoover’s lair. Berle, a formidable economist who had been part of FDR’s New Deal brain trust and still had his ear over at the State Department, nevertheless worried that Donovan’s spy operation would be an adjunct of Stephenson’s. Even Roosevelt privately questioned whether the package he was being pitched was Donovan’s or London’s, although he kept his uneasiness to himself as Donovan and Knox settled into their chairs before his desk.

  Donovan told the president he did not really want the intelligence job (he still hungered for combat with a division) but he would take it on three conditions: First, he reported only to FDR. Second, Roosevelt paid for the operation out of a secret, and unaccountable, White House fund Congress had approved. And third, FDR instructed all other government departments “to give me what I want.”

  A bureaucratic firestorm erupted behind closed doors over Donovan’s intelligence plan. Tipped off early by informants, Hoover began lobbying the White House against it before Donovan had even put it on paper for Roosevelt. Hoover had built a massive domestic counterespionage operation in the thirteen years since Donovan had left Justice. The FBI had fingerprint cards on more than ten million Americans, confidential files with embarrassing personal information on hundreds of politicians, and now read thousands of pieces of international mail the British shared from their secret letter-opening facility in Bermuda. The FBI had rounded up most Nazi subversives. The bureau also oversaw spying in Latin America. Hoover, who suspected Donovan had continued to try to get him fired after he left Justice, did not want him meddling in his operations now.

  Neither did George Catlett Marshall. Dignified and aloof with an obsession for proper order, Marshall also had an explosive temper, which erupted whenever he caught anyone trying to play politics with him or his Army. Marshall was now furious with what he saw as a naked ploy to usurp his power as chief of staff and give another man control over his intelligence arm with direct access to the president. Marshall demanded that Stimson, who was inclined to agree with Donovan on this idea, strangle the plan in the crib.

  But Roosevelt, who had so far been successful at picking the right men for jobs, felt he had nothing to lose with this appointment and Donovan was the only forward thinker in town with a plan for fixing the intelligence mess. With the press now buzzing about the bureaucratic battle, Roosevelt finally signed the executive order on July 11 designating a new “Coordinator of Information.” Stimson had managed to water it down, making it an unpaid position. Donovan’s duties were described so vaguely it left other cabinet officers scratching their heads over exactly what his job was. He would “collect and analyze all information and data, which may bear upon national security,” and perform other unspecified “supplementary activities” for FDR (which Donovan took to mean psychological operations and sabotage). Other departments were ordered to cooperate with him, but Donovan could not “interfere” with Army or Navy intelligence operations.

  London was delighted with the appointment. The German embassy in Washington, which had been following closely the bureaucratic maneuvering, cabled Berlin that Donovan and his gang of “notorious German haters” had been organized to promote FDR’s “political and economic war measures” among Americans and to “counter strongly the effective propaganda by the Axis powers.”

  With so many powerful men in Washington’s political snake pit lined up against him, Donovan either will “give up in disgust or fight his way through,” Interior Secretary Harold Ickes, a key New Dealer, wrote in his diary. “Probably he will be able to do the latter, as he is a fighter.” Ickes’s prediction would prove true.

  AROUND THE DINNER table of his Georgetown home, Donovan, Elmo Roper, and Robert Sherwood began sketching out the new intelligence agency. Roper was a public opinion pollster skilled in gathering information overseas and an administrative gadfly brimming with ideas for how the organization should be set up. Sherwood was a Pulitzer Prize–winning playwright Donovan had met at the premiere of one of his New York productions and now a rabid New Dealer who wrote speeches for Roosevelt. Tall, angular, and artistically temperamental, Sherwood also was a bon vivant who enjoyed fine wine and women. He was now eager to join Donovan as his chief propagandist.

  For days in Georgetown and at Donovan’s New York apartment, the men scratched ideas on notepads, crumpled sheets, and threw them into the wastebasket. They grappled with complex questions about exactly how a spy operation should collect, analyze, and report information and use it as a weapon. Stephenson continued to feed suggestions. Sherwood was dispatched to New York to acquire radio-transmitting stations and recruit broadcasters and journalists, like Chicago Daily News foreign correspondent Wallace Deuel, who were eager to leave the newsroom and join Donovan as spies or propagandists. To analyze intelligence, Donovan knew he needed a research department immediately. “If we get into this [war], and we probably will,” he told Roper, “we want men who can tell us more about France than anybody now knows . . . and we’ve got to know the same thing about every single country in Europe and probably Asia.” Archibald MacLeish, the voluble poet and librarian of the Congress, agreed to lend the library’s scholars. Donovan recruited James Phinney Baxter III, the erudite president of Williams College, to head the research and analysis section.

  With $450,000 from Roosevelt’s secret fund, Donovan soon moved the operation to government quarters, first to an empty barnlike conference room in the State Department offices next to the White House, then to the Apex Building near the Capitol. Donovan got the Navy to loan him a Buick sedan, eventually with one of Zenith’s new portable shortwave radios installed in it so he could talk to FDR and other key administration officials on the road.

  Donovan made a number of politically astute hires. Estelle Frankfurter, Justice Felix Frankfurter’s brilliant and Washington-savvy sister, came on board to make sense of complicated government reports for him. Marine Captain James Roosevelt joined to cajole other departments into cooperating, a chore Donovan detested and knew FDR’s son would have more clout doing. More senior aides were brought in, such as Edward “Ned” Buxton (a World War comrade) to be an assistant director and organize a unit to interview foreigners arriving in the United States with useful intelligence, David K. E. Bruce (a courtly Virginia lawyer and world traveler) to head the intelligence collection operation, and William Whitney (a pro-British American lawyer) to set
up an office for the new agency in London.

  Early in September, Donovan moved his operation to its permanent headquarters, a three-story granite building with long stone columns in the front that the Public Health Service was abandoning at 25th and E Streets atop Navy Hill. Donovan took the high-ceilinged corner office on the first floor of the “Kremlin,” as staffers soon nicknamed the East Building. From its tall windows, which he liked to keep open even in winter, he could see the Potomac River far off. His room number was 109, which he now made his code number for message traffic. The top third floor still had caged lab animals the health service had used for syphilis research. Berlin radio mocked it as the new home of “50 professors, 10 goats, 12 guinea pigs, a sheep, and a staff of Jewish scribblers.” For several weeks Donovan’s aides gagged on the putrid smoke from animals carted out and incinerated nearby.

  The German embassy in Washington was not so contemptuous of the Kremlin. It fired off a coded cable to the Foreign Office warning that “as soon as the Donovan organization is on track,” Hitler should expect American agents organizing “acts of sabotage against the occupying army.” Donovan indeed commanded Roosevelt’s premier espionage organization—but not his only one, the lawyer quickly learned to his great annoyance. He stumbled across another one almost by accident as he tried over a breakfast to recruit Chicago anthropologist Henry Field, a relative of department store magnate Marshall Field. Henry told a startled Donovan he could not join his organization because he worked for another secret White House spy agency.

  John Franklin Carter was a brainy and passionate Washington columnist, easily excitable, who tended to feel self-important and have harebrained ideas. But he had worked for a while as an administration speechwriter and had known Roosevelt since he was governor. While Donovan was roaming the Balkans in February, Carter, who also thought U.S. intelligence was “loused up,” had convinced Roosevelt he needed a small, off-the-books operation for discreet spying that the White House could deny existed. With $10,000 in start-up money from FDR’s secret fund, Carter hired a dozen informants, many of them businessmen overseas, who fed him tips on military and political developments abroad, which he passed to Roosevelt. Carter also spied on FDR’s political enemies at home. Donovan complained to FDR, and even vented to Hoover, about being kept in the dark on what Carter was up to. But Roosevelt encouraged rivals and he never let one person know everything he was doing. After Carter’s money ran out in June, FDR approved another $30,000 for the rest of the year. Carter also continued to take pot shots at Donovan in the syndicated column he still wrote, never mentioning to his readers that he was a bureaucratic competitor.