All Commentary
Tuesday, May 1, 1962

A Reviewer’s Notebook – 1962/5


The used to be landed proprie­tors. Now there are funded pro­prietors. And, just as the landed proprietor was regarded with am­bivalent feelings (he served a function by providing a free mar­ket in real estate, he was envied by the landless), so the funded proprietor excites people to quite mixed-up responses.

There are fashionable modes in these responses, too. Three recent books about funded families—John Tebbel’s The Inheritors (Putnam’s, $5), Edwin P. Hoyt’s The Vanderbilts and Their For­tunes (Doubleday, $4.95), and Frederic Morton’s The Roth­schilds: A Family Portrait (Athe­neum, $5.95)—differ a bit from each other in their attitude toward the duties of monied people. But the latest fashion in thinking about rich families is evidently to insist that they cultivate clan sentiments.

According to these books, rich people should have a dynastic sense. They should, of course, be prepared quite cheerfully to pay their inheritance taxes if they are to satisfy the modern view. But, having done that, they should so arrange their wills that the family seat of power—a great bank, a railroad, an automobile manufac­turing company—will continue to freshen the fortunes of the tribe. If the inheritance tax laws make it difficult for any particular fam­ily group to retain control of a corporation over the generations, there are ways around the diffi­culty. After all, one can establish a foundation which will remain suitably neutral in company mat­ters even though it holds a good percentage of the stock.

Far be it from this reviewer to object to dynastic families. The Rothschilds, as followed through several generations by Mr. Mor­ton, have used their power and money both wisely and well. Ditto for the Mellon, Rockefeller, Ford, and du Pont families, as chroni­cled by Mr. Tebbel. But if a fam­ily loses its dynastic sense, which is what happened in the case of the Vanderbilts, just why is it a cause for social moralizing? Mr. Hoyt evidently thinks it a shame that old Commodore Vanderbilt, who put the New York Central Railroad together, could not have found some device to entail the property to Vanderbilts in perpe­tuity. Well, it might have been better for the Vanderbilt name if one Vanderbilt in each generation had been drilled in the idea that it was his duty to regard the New York Central as a sort of indus­trial family dukedom. But insofar as the public is concerned, it would seem to be a matter of supreme indifference what name is attached to a property provided that the property is efficiently run.

Constructive Use

From the economic standpoint, the truly interesting thing about these three books is the proof they offer that money can be trusted to gravitate willy-nilly into the hands of people who are able to use it constructively. Sometimes the con­structive personage will be a de­scendant of the original fortune maker; sometimes he will be a total stranger. The Rothschilds, who have never let their inherit­ance be dispersed by handing over huge chunks of income-producing property to female offspring, have done constructive investment banking in London and Paris ever since the time of the first Na­poleon. The du Ponts have always bred sons and cousins who have retained an active interest in chemical engineering and in indus­trial management. But when the heirs of the Dodge brothers, both male and female, developed a pas­sion for spending their inherit­ances far from the automobile production lines of Detroit, it did not mean that anything of impor­tance was lost. The true Dodge “inheritor” happened to be a man named Walter Chrysler, who bought control of the Dodge Motor Company and used its manufac­turing facilities just as efficiently as if he had been John or Horace Dodge’s true son.

Reading about Rothschilds, Rockefellers, Vanderbilts, du Ponts, Dodges, Huttons, Dukes, and other assorted rich families, it is forcibly brought home to one that “society,” as represented by the state, is hardly called upon to have any official attitude toward inherited wealth. Is it a good thing that Rockefellers, Fords, and Mellons, for example, have been virtually forced by inheritance tax law to put their money into foun­dations instead of handing it on outright to various scions?

A Complicated Question

To answer such a question, one would have to balance the char­acters of separate Rockefeller, Ford, and Mellon children against the acumen of the administrators chosen to run the separate foun­dations. Naturally, no hard and fast judgment suggests itself. Rockefeller foundations have done good work in educational and medical fields. On the other hand, nobody can cavil at David Rocke­feller’s record in banking, or at Nelson Rockefeller’s use of his money in promoting industry in Venezuela. So what if David, Nelson, and their brothers had in­herited all of their grandfather’s oil money outright? Inasmuch as the Rockefeller boys know how to employ their dollars in job-creat­ing activity, the end result to so­ciety would have been good. And medicine and education would hardly have suffered by the multi­plication of wages and dividends which, in turn, would have been available to pay for schooling and hospitalization.

Primogeniture and Entail

On the other hand, why are spenders so terrible, and what dif­ference does it make if “dilution” cuts family fortunes into little pieces? About a hundred years ago the world decided that primo­geniture and entail in landed estates worked a monopolistic in­justice on younger sons. Wisely, the founders of the American re­public let primogeniture and en­tail disappear from the local scene. Well, if entailing of control is bad as applied to the land, wouldn’t it be just as liable to abuse if ap­plied to other forms of productive wealth?

What if a single stupid Vander­bilt had received the bulk of the Commodore’s money in the third generation, say? Vanderbilt funds happened to be diluted for the simple reason that fecundity was a natural characteristic of Van­derbilts as they produced new generations. This was quite in ac­cordance with democratic precepts. The “diluted” money of the Van­derbilts went to pay for many things, some wise, some indiffer­ent, and some foolish. Vanderbilts were sportsmen: they bred horses, raced automobiles, and went in for defending cups against com­peting British yachtsmen. All of this gave color and savor to the American scene. Willy K. Vander­bilt the Second helped Ransom Olds and Henry Ford out as pio­neer automobile manufacturers by making motoring popular among those who could afford to buy the first cars. Later Vanderbilts pro­vided Juan Terry Trippe of Pan American Airways with some of the capital needed to establish the airline business. This was con­structive work. Less constructive were the Vanderbilt wives who gratified themselves by society doings which, to our generation, seem incredibly frivolous as we look back on them. But the money “wasted” went to support archi­tects, dressmakers, cooks, and art dealers. So was it really “wasted,” after all?

A Railroad that Couldn’t Support a Dynasty

The New York Central passed out of Vanderbilt hands when Robert R. Young, backed by Richardson and Murchison money from Texas, took control of the railroad. Was this a good or a bad thing? Inasmuch as Harold Vanderbilt, as a director of the railroad, had helped to pick a good railroad president, William White, to run the Central, there was little justice to Mr. Young’s con­tention that the Vanderbilts had lost their railroading touch. But when Mr. Young’s own particular choice for the railroad presidency, Alfred E. Perlman of Denver and Rio Grande fame, took over Mr. White’s job after the big Young proxy victory, one good man re­placed another. So the stockholders came out just about even on the change. As for Harold Vanderbilt, he lost his base in the company that had been created by the old Commodore. But railroading as a whole had fallen on evil days, and the Central was no longer in a position to support a dynastyin any case. Perhaps it would have been better, on balance, if Harold Vanderbilt had taken his money out of the Central years before.

The moral of books about monied families, then, is that there is no single moral. Monied dynasties are interesting. But if what a monied man creates passes into the hands of others, it can be interesting, too. In either case, money is as money does: the name that is attached to it is quite, quite immaterial. Whether a Dodge is made by a Dodge or by a Chrysler, the thing that counts is what is under the hood.

The Committee And Its Critics by William F. Buckley, Jr

. (G.P. Putnam’s Sons, New York, 1962, 352 pp. $4.95)

Reviewed by William Henry Chamberlin

The house committee on Un-American Activities (HUAC for short) has been the target for an unprecedented campaign of abuse, slander, and denigration, spear­headed by the American Com­munist Party and its proliferating fronts, but extending to well-meaning though poorly informed “liberals.” As a result an image has been built up of a monstrous inquisition, invading the privacy and personal lives of blameless citizens, who are supposedly denied elementary rights, such as representation by counsel The thoroughly false allegation is sometimes made that HUAC has never sponsored legislation.

It is high time that the sober factual truth about the Commit­tee, its functions, purposes, and accomplishments should be told. William F. Buckley, Jr. in col­laboration with the editors and contributors of National Review has done this very effectively in an over-all survey of the history of this controversial body. What emerges is an image of a Congres­sional Committee, operating under legal procedures and restraints, properly authorized by Congress to keep a watchdog eye on a per­manent conspiracy against the se­curity of the American Republic, making its normal share of mis­takes, but casting a badly needed spotlight on some activities of Soviet spy rings and on the opera­tions and methods of the numer­ous “fronts” by which the Com­munist Party tries to infiltrate into American public life and en­list the cooperation of duped in­nocents for its purposes.

Investigation is one of the old­est established rights of Con­gress and has never been success­fully contested in the courts. One of the curious inconsistencies in leftist attacks on HUAC is that methods of searching probe which evoked loud cheers when applied against suspected criminals and “malefactors of great wealth” are denounced as outrageous when ap­plied to individuals suspected of taking part in a conspiracy with implications of espionage and even treason.

One of the most colorful chap­ters in the book is Ralph de Tole­dano’s staccato, rapid-fire recon­struction of the case of Alger Hiss, which was touched off by hearings of the HUAC. The con­frontation of the repentant former communist agent, Whittaker Chambers and the unrepentant Hiss, who at first denied ever knowing Chambers, is one of the biggest dramas of the postwar period. Drawing on an intimate knowledge of all the details, ac­quired by journalistic coverage of the case, de Toledano shows how Hiss’s first attitude of contemptu­ous superiority was broken down bit by bit, until the revelations in the spectacular “pumpkin papers” led to the indictment and convic­tion of Hiss for perjury, the stat­ute of limitations excluding the possibility of a more serious charge.

Student groups, egged on by local communists, carried out riot­ous demonstrations against HUAC hearings in San Francisco in May 1960. A film, “Operation Aboli­tion,” showing these demonstrations, has been attacked with re­markable venom. The book con­tains M. Stanton Evans’ exhaus­tive examination of what really happened in San Francisco, and the role of well-known local com­munists in the affair.

The Committee has probably suffered from its name. “Un-American” does lend itself to sa­tire and suggests an unduly wide free-wheeling range of activities. Perhaps “Anti-American” would be a more specific definition of what HUAC is really about. Mr. Buckley thinks “Committee on Communist Activities” would de­fine the proper scope of the Com­mittee’s functions more satisfac­torily and elaborates his sugges­tion as follows:

“It is not despicable movements… that we want to see watched over by a committee of Congress. It is any despicable idea (whether historically un-American or not) which (a) is being sustained by foreign and powerful enemies of the republic, or (b) threatens ex­plosive internal crises.”

As Mr. William F. Rickenbacker shows in his excellent chapter, a short history of the Committee, HUAC had a narrow escape from extinction in 1945, when illusions about the harmlessness of com­munism, the supposed “democ­racy” of the Soviet Union, and Stalin’s willingness to cooperate for peace and justice were at their height. An amendment offered by Representative John Rankin of Mississippi, making the commit­tee permanent, squeezed through by the close margin of 208 to 186.

But since that time, despite the drumfire of hostile criticism, HUAC has gained steadily in pop­ular esteem and congressional support. When Representative James Roosevelt of California went on the warpath against HUAC and started his own “Oper­ation Abolition,” he received com­mendatory pats on the back from The Washington Post and also from The New York Times.

But when the votes were counted, Mr. Roosevelt mustered exactly five supporters, as against 412 who favored the continuation of the Committee. Here, as on such issues as the recognition of Red China and its admission to the United Nations, the popular instinct, as reflected in near unanimous votes of Congress, has clearly not been much affected by the fulminations of leftist intel­lectuals.

A chapter on the procedures employed by the Committee shows that there were some mistakes and inconsistencies in the first post­war years. However, in

1953 elaborate rules of procedure were adopted, with careful considera­tion of the rights of witnesses to be represented by counsel and of persons placed in an adverse light by testimony before the Commit­tee to appear before the Commit­tee and state their side of the case.

Most of what has been written about the Committee, apart from its own publications, has been in a hostile polemical spirit. Anyone who is interested in getting a fair factual picture should read this book, which, although prepared by individuals friendly to the aims and purposes of HUAC, contains much useful documentary and fac­tual material. Indeed, no one can discuss the lively controversial subject of the Committee with au­thority without making himself familiar with the contents of this first over-all survey of its work.

In looking through this story of HUAC one is constantly im­pressed by the extravagant vehe­mence and persistence of the at­tacks which have been delivered against this particular exercise of the established investigative pow­er of Congress. This seems to re­flect not spontaneous outbursts of indignation, but a carefully laid design to discredit and, if possible, destroy a body which has cast much light on the dark and devious ways of the communist under­ground and made itself thoroughly obnoxious to subversives and con­scious or unconscious Soviet agents.

Of these enemies HUAC may well be proud, as Grover Cleveland was loved for the enemies he made.


  • John Chamberlain (1903-1995) was an American journalist, business and economic historian, and author of number of works including The Roots of Capitalism (1959). Chamberlain also served as a founding editor of The Freeman magazine.