FDR - Jean Edward Smith [217]
Opposition centered in the hierarchy of the Roman Catholic Church, the leadership of the AFL, and conservative patriotic groups such as the Daughters of the American Revolution. FDR could safely ignore the DAR and Bill Green, but the Church required attention. Roosevelt turned on the charm. On September 4 he invited Father Edmund A. Walsh, the dean of Georgetown University’s School of Foreign Service, to the White House for a chat. Walsh was one of the most outspoken critics of recognition, and his anti-Soviet public lectures at Washington’s Smithsonian Institution drew overflow crowds. An hour after meeting Roosevelt, Walsh told reporters he thought the president should be trusted to do what he thought was right.35
Because the career diplomats in the State Department—many of whom had spent the last fifteen years hobnobbing with White Russian émigrés—were still imbued with nostalgia for the czarist past, Roosevelt handled the negotiations himself, first through Henry Morgenthau, then through William C. Bullitt.36 Morgenthau, as head of the Farm Credit Administration, dealt with the Soviet trade organization Amtorg; Bullitt with Boris Skvirsky, the senior Russian commercial representative in the United States. As a result of these covert discussions, FDR invited Soviet foreign minister Maxim Litvinov to Washington for direct negotiations in early November.37 The ostensible outstanding issues involved freedom of religion for Americans in Russia and the continued agitation for world revolution mounted by the Comintern. The real sticking point was restitution of American property seized by the Soviet government in its nationalization decree of 1919.* Roosevelt and Litvinov compromised. The agreement is known as the Litvinov Assignment. The Soviet government assigned to the United States its claim to all Russian property in the United States that antedated the Revolution. The United States agreed to seize the property on behalf of the Soviet Union, thus giving effect to the Soviet nationalization decree, and use the proceeds to pay the claims of Americans whose property in Russia had been confiscated. The constitutionality of the assignment was twice challenged before the Supreme Court, but in both instances it was upheld, the “taking clause” of the Constitution notwithstanding.38†
Shortly after midnight on the morning of November 17, FDR and Litvinov signed the documents restoring diplomatic relations. At a farewell dinner for the Soviet foreign minister at New York’s Waldorf-Astoria, business titans from J. P. Morgan, Chase, and other firms eager to do business with the USSR toasted the new era of recognition. Thomas Watson of IBM asked Americans to “refrain from making any criticism of the present form of government adopted by Russia.”39
Meanwhile, the National Industrial Recovery Act was having birthing problems. Enacted the last day of the session, the act established two complementary agencies: the National Recovery Administration (NRA) to coordinate economic recovery, and the Public Works Administration (PWA), authorized to spend $3.3 billion in pump-priming construction projects. NRA and PWA, as one historian has written, “were to be like two lungs, each necessary for breathing life into the moribund industrial sector.”40 But FDR made the fatal error of dividing responsibility. To head the NRA, Roosevelt brought in former brigadier general Hugh “Iron Pants” Johnson, a flamboyant protégé of Bernard Baruch, renowned for his can-do military spirit and robust invective. Hard drinking and hard living, Johnson said of his appointment, “It will be red fire at first and dead cats afterward”—evidently an old Army expression.41 For PWA, the president turned to Harold Ickes. No two appointees could have been more dissimilar, and no two less likely to cooperate. For Johnson, an old cavalryman, every undertaking was a hell-for-leather