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by Richard Nixon


  Whenever a President travels there are scores of security and support personnel who have to travel with him to make sure that he is safe and to make sure that his communications facilities are as extensive and secure as they are at the White House or at Camp David. I felt that we also had to take these expenditures into account lest we be accused of trying to hide them. Therefore at my instructions GSA audited every penny the government had spent in San Clemente, Key Biscayne, and Grand Bahama, and on security for my daughters at their homes. More than 20,000 man-hours were devoted to combing 10,000 accounting records and 1,600 files. In the end it cost the government $313,582—50 percent more government money than had been spent on the houses—to answer the congressional and press inquiries. On August 6 we released the totals arrived at by GSA: $1.1 million had been spent on the houses and grounds; $2.5 million had been spent on the office complexes and security measures on government property near the houses; the Defense Department spent $6.1 million for routine presidential communications equipment and support, 60 percent of which would be completely recovered when the equipment was taken away after my presidential term ended; $211,000 more had been spent directly by the Secret Service on equipment connected with their security needs, 90 percent of which would be recovered after I left office.

  The next morning, the Washington Post and the New York Times ran almost identical headlines: $10 Million Spent on Nixon Homes wrote the Post; $10 Million Spent at Nixon Houses wrote the New York Times. Other newspapers and the television news shows adopted the same line. Not surprisingly, many people felt that this money had been spent on the homes themselves.

  Over the next months we tried to correct those stories by pointing out that almost all the money had been spent on security measures. Only 2 percent of that amount had been spent at the houses themselves; almost 90 percent, or $8.9 million, had been spent on administrative and protective support totally divorced from my personal property. But it was a hopeless public relations battle.

  Representative Brooks was determined that his house subcommittee hearings would make the most of the story and his plans were only temporarily foiled when two of the subcommittee members, one of them an anti-Nixon Democrat, toured the San Clemente house and pronounced the government expenditures justifiable. The Wall Street Journal editorialized, “In short, despite all those headlines, the spending at San Clemente seems to have been a non-story. . . . It might be wise, too, to think about how the press might undo non-stories when they arise.”

  Before my administration most of the requests for government expenditures at a President’s private property had been made orally and informally. The Defense Department had handled the majority of such requests and expenditures for Lyndon Johnson. I was told that Brooks, who had been one of Johnson’s most intimate political allies, carefully confirmed the inaccessibility of the full Johnson record before proceeding against me. Even from what little could be reconstructed, however, it was apparent that at least $5 million had been spent on various Texas sites for Johnson, including the LBJ Ranch; the Haywood Ranch and boathouse in Llano County; his suite at Brooke Army Medical Center, San Antonio; and his office at KTBC, the television station Mrs. Johnson owned in Austin. Over $99,000 was spent remodeling and redecorating Johnson’s office in Austin; a million dollars was spent carrying out his request for a major redesign of the federal office building there and for construction of a helipad on the roof of the building so that he could fly directly there from the LBJ Ranch. A small house Johnson owned near his ranch was remodeled by GSA according to his detailed instructions, and he then leased it to the Secret Service. Spiro Agnew, incidentally, had provided the Secret Service with two rooms in his house in Maryland without any charge.

  Probably the most astonishing testimony to come before Brooks’s subcommittee related to expenditures for President Kennedy at Hyannisport; Middleburg, Virginia; Palm Beach; Squaw Island, Massachusetts; and Atoka, Virginia. The records of these expenditures had been kept by a naval aide to Kennedy, and the subcommittee was told that the aide had accidentally dropped them overboard while his ship was either in the Philippines or somewhere near Europe.

  In preparing his tally of government expenditures on my houses and properties, Brooks added up every penny paid to every person working, however remotely, in any connection with the presidential office during every trip. Thus he included the salaries of people like cleaners and custodial staff who would have been on the government payroll regardless of my trips. In this way he came up with a total of $17 million. He put it in a report labeled “Confidential,” which was promptly leaked. The headline in the New York Times was: U.S. Aid to Nixon Estates Put at $17 Million. Brooks’s subcommittee began its work in the fall of 1973; the final report, however, was not issued until May 1974—just in time for the opening gavel of the House Judiciary Committee’s hearings on impeachment. One of the worst distortions to come out of Brooks’s investigation was the idea that Bob Abplanalp had benefited from government expenditures at his Grand Bahama home. In fact, when the Secret Service requested the installation of intrusion alarms, fire detection systems, and special generators, Abplanalp paid for them out of his own pocket. He also built a bunkhouse for the Secret Service agents and allowed the government free use of other buildings on the property. All these would have been completely legitimate government expenditures, but Abplanalp paid for them himself, thereby personally saving the government more than $1 million.

  I still held the naïve belief that all suspicion and press speculation about my taxes could be dispelled by the facts. Therefore we began to prepare my tax returns for release to the public. I thought that in this way we would firmly and conclusively put to rest the malicious accusations about how I had bought my homes and whether I had paid the taxes I owed.

  In a press conference on November 18 I described my finances over the years. I reminded the reporters of the fact that after fourteen years as congressman, senator, and Vice President, I had a net worth of $47,000 and a 1958 Oldsmobile that needed an overhaul. Such money as I had been able to accumulate was the result of earnings when I was in private life, mainly when I was with the law firm in New York. I concluded:

  I made my mistakes, but in all of my years of public life, I have never profited, never profited from public service—I have earned every cent. And in all of my years of public life, I have never obstructed justice. And I think, too, that I could say that in my years of public life, that I welcome this kind of examination, because people have got to know whether or not their President is a crook. Well, I am not a crook. I have earned everything I have got.

  This was not a spur-of-the-moment statement. The attacks on my personal integrity were more disturbing for me and my family than all the other attacks put together. I thought it was essential to put my defense in down-to-earth, understandable language. But it was a mistake. From then on, variations of the line “I am not a crook” were used as an almost constant source of criticism and ridicule.

  The first articles on my December 8 release described the extent of the disclosure I had undertaken: “With the release of his income taxes and assorted deeds, mortgages, canceled checks and legal agreements, President Nixon has probably made the fullest disclosure of personal finances in the history of the country.” But within only a matter of hours other news reports complained that “most of the issues” were still unresolved. Before long I concluded that the release of the income tax returns had been a mistake. It was the same old story: those who had been demanding that I put out my returns did not really want conclusive proof that the stories about the allegedly illegal purchases of my houses and the supposedly vast secret investment portfolios were false. They seized on the fact that I had large deductions as if it were immoral not to pay more taxes to the government than the law required be paid. They were only looking for ways to keep the stories alive and for any new vulnerability that might turn up.

  There were two particular issues raised about my tax returns that were highly comple
x and on which tax lawyers disagreed. One involved a question about whether I had made a taxable capital gain when I sold some of the San Clemente property to Rebozo and Abplanalp. The accountant who had prepared my taxes insisted that I had not. He found support from some tax professionals and arguments from others. The other controversial question concerned the deduction I had taken for the donation to the National Archives of my prepresidential papers. The idea had come from Lyndon Johnson in 1968 when he told me about the statute providing for the deduction, which, he said, he had been taking for years. He urged that I take advantage of it and recommended that I employ the same expert appraiser he had used to assess the value of his papers. It turned out that a number of public figures had been taking advantage of such deductions long before I found out about them; they included Governor Pat Brown, John Kenneth Galbraith, George Wallace, Hubert Humphrey, Theodore Sorensen, and Arthur Schlesinger, Jr.

  Ralph Newman, the appraiser recommended by Johnson, found that in my prepresidential files there were more than a million papers, worth approximately $2 million. In December 1968 I gave a specific portion of these papers to the government and took the allowable tax deduction. Early in 1969 I instructed John Ehrlichman to do what was necessary to make another and larger gift of papers that would spread out the maximum legitimate deductions over the next several years. The papers were delivered to the National Archives on March 27, 1969. A donation of 600,000 documents was appraised at $576,000.

  In December 1969 Congress added an amendment to my tax reform act that repealed the provision allowing for any deductions for donations of papers. This amendment was made retroactive to July 25, 1969.

  I was confident that the members of my staff and my lawyers, to whom I had delegated the responsibility for preparing my tax returns and executing the documents for the donation of my papers, had taken this change of the law into account and had had everything in order. I was shocked and totally frustrated when, in 1973, I found that this was not the case. A question was raised first by the press and then by the IRS itself about whether the paperwork for my papers donation had actually met the retroactive July deadline.

  In the first week of December Bryce Harlow urged that I let the Joint Congressional Committee on Internal Revenue Taxation review the controversial papers gift deduction and the question about the capital gain. He had worked with this committee in the past and found them thorough and objective. Kenneth Gemmill, a prominent tax attorney who helped advise us, shared his views.

  On December 8, therefore, I wrote a letter to Wilbur Mills, the chairman of the joint committee, and asked that these two questions be examined. I said that in the event the committee determined that the items had been incorrectly reported, I would pay whatever tax might be due.

  On December 13 Mills replied that the joint committee had agreed to consider the case. But he added a new twist. “The committee believes,” he wrote, “that the examination should be of all tax items for 1969 through 1972 for the examination to be meaningful.” That same day the New York Times quoted Mills as saying that he was critical of the deductions I had taken, even if they were legal. “A public official who files a tax return has to be holier-than-thou,” Wilbur Mills had said.

  I began to fear that I had walked into another trap. My fears were soon borne out. In ordinary times the joint committee may have been, as Harlow had said, objective. But these were not ordinary times. Some of the committee members turned out to be weak and irresponsible; their large staff turned out to be even worse. Philadelphia Bulletin columnist Adrian Lee examined the political affiliations of the twenty-five members of the committee’s staff and could not find one Republican.

  On March 8, 1974, before the committee had reached any findings, Chairman Mills said publicly that he thought I would quit office after their report on my taxes came out. On March 18 he predicted that I would be out of office by November because of “dismay” over my taxes.

  Harlow’s reports from the joint committee grew increasingly bleak. The staff had broken a promise by sending its draft report directly to the committee without even giving my lawyers a chance to review its findings or to file their own briefs in support of my case.

  In the meantime things on our side were falling disastrously apart. I learned that, without my knowledge, the deed for the gift of the papers had in fact been backdated by one of the lawyers handling it for me. My tax attorneys argued that the deed was not crucial to the gift, and that the important thing was that I had expressed my intent to make the donation and had delivered the papers to the archives three months before the July 25 deadline. Previous court cases supported that view, but the unnerving disclosure of the backdated deed considerably undermined my position with my few supporters on the committee.

  The members of the joint committee actually met only twice to consider the question of my taxes: once to accept the assignment in December 1973 and once to receive the thousand-page staff report in April 1974. A majority of the members were not even sufficiently concerned to go over the report or to hear my side of any of the major controversial issues. Senator Carl Curtis of Nebraska decried the staffs work. “No other taxpayer in our country has been treated with the harshness that was given the President of the United States in that report,” he said.

  In addition to finding against me on the papers donation and the capital gains question, the committee staff report found that I should reimburse the government for the air fare when Pat and the family flew on Air Force One with me if they were not performing official functions. No other President had ever been charged for his family in this way; in fact, I was the first President to have reimbursed the government for unofficial flights by members of my family when I was not on board the plane.

  The committee staff also disallowed the kind of deduction I had taken for the use of my Florida house as an office, on the ground that I did not have to use my house for this purpose because the government could have built me an office there!

  The Republicans on the joint committee expressed shock that the staff had arrogated such power to itself and had then wielded it so arrogantly. Harlow was promised that my supporters would insist that the whole matter be turned over to the IRS, but in the end all of them, with the exception of Carl Curtis, bowed to pressure and did nothing. The political heat was too great.

  By this time I had also received a new ruling from the IRS. Although my tax return had been approved in two earlier audits, the IRS now reversed itself and said that I should pay back the deduction I had taken for the gift of the papers, and also pay tax on the San Clemente transaction as a capital gain.

  There was an ironic twist involving the gift of the papers. As far as the joint committee and the IRS were concerned, I had not made a legally proper gift. But as far as GSA was concerned I had, and they therefore refused to return my papers to me. In other words, I lost both the deduction and the papers.

  My lawyers urged that I go to tax court and fight the ruling. They said that the joint committee and the IRS had clearly bowed to political pressures and that I would win the case in court. But I had already lost the case as far as public opinion was concerned, and at that point that was what mattered to me most. Besides, I had agreed to abide by the joint committee’s ruling, and I could hardly go back on that now.

  On April 3 I issued a brief statement that I had heard of the joint committee’s decision to release a staff analysis of my taxes even before the committee members had had an opportunity to meet and evaluate the staffs findings. I said that I would pay the taxes due because of the disallowance of the deduction for the papers donation and also the taxes on the capital gain.

  Over the next several days we received $47,000 from citizens who wanted to help me pay the taxes. Pat and I were deeply touched. Of course, we returned the money. On April 17 Tricia walked into the Lincoln Sitting Room. She said that she and Ed had decided to sell their wedding gifts and give Pat and me the money for the taxes. I assured her we could get a loan to cover the amount. “
We don’t want to loan the money to you,” she said, “we want to give it to you.”

  In the end, 36 people on the staffs of GSA, GAO, two House committees, the White House staff, and the Secret Service had worked 67 days on the inquiries about Key Biscayne; 33 people had worked for 137 days on San Clemente; the joint committee staff of 23 had put 6 people full-time on my finances, and they worked with 5 full-time IRS people. There had been no fraud on my part, and no impropriety, but the effect of the tax issue was a devastating blow, coming as it did in the crucial months when the Judiciary Committee was beginning to weigh impeachment.

  THE ASSAULT BECOMES PERSONAL

  Eugene McCarthy once compared the press corps to a flock of blackbirds: one flies off the wire and the others fly off, one flies back and the others return. Something that starts as an idle discussion within the Washington press corps will soon be repeated in wider circles among the Washington establishment, and before long it is being reported, interpreted, and analyzed without a thought to where it originally came from.

  As an example of this phenomenon, at some point in the hot, muggy summer of 1973, some of the more influential members of the Washington press corps concluded that I was starting to go off my rocker. They decided that my decision not to answer the Watergate charges until after the Ervin hearings had ended, and my isolation from the press on Watergate, showed that I was peculiarly out of touch with reality. Later that summer, my desire to take private drives without being followed by the press and photographed every moment—something done by President Johnson before me and by President Carter after me—was treated as a sign of mental pathology.

  Since they were already thinking along these lines, the press corps had a ready-made explanation when I displayed an outburst of anger at Ron Ziegler in New Orleans. This trip was one of my first public appearances after the Watergate hearings, and we were counting on the large and enthusiastic crowds that had been predicted to help dispel the idea that I was isolated and unpopular because of Watergate. While we were on Air Force One we received a Secret Service report that there was a serious threat of an assassination attempt. Personally I would have been willing to take the risk; but I could not endanger the safety of the crowds. Therefore I had to enter the city by an unannounced route.

 

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