In August 1974, Richard Nixon resigned as President of the United
States of America and Vice President Gerald Ford ascended to that
position. One of Ford’s earliest responsibilities was to nominate a new
Vice President of the country: and he named Nelson Rockefeller. This
led to a series of hearings in the Congress, before his ultimate
confirmation.
Those Congressional hearings provided a significant opportunity for
public exploration of an old philosophical question: What is the true
and proper role of private family wealth in this avowedly democratic
nation? None could be more relevant than the family of the
Rockefellers. The original John D. Rockefeller, a business genius
active from the late 1800’s to the early 1900’s, created the (in)famous
Standard Oil Company and became the icon of American capitalism, to be
revered or damned by later generations.
When the confirmation hearings reached the House (the Senate having
proceeded
quickly), two professors from the University of California were
invited to present their study on the extent of the Rockefeller
family’s ongoing influence in America’s economic life at this later
epoch. Their report, “Probing the Rockefeller Fortune”, was summarized
and discussed in the official transcript of the Hearings [“Nomination
of
Nelson A. Rockefeller to be Vice President of the United States,”
Hearings before the Committee on the Judiciary, House of
Representatives, Ninety-Third Congress, Second Session, December 2,
1974, (Serial No. 45) pages 717-772]; but, somehow, the text itself was
not reproduced in those archives. Here is a copy of that original
report.
[e-version by C. Schwartz, January 2007.]
PROBING THE ROCKEFELLER FORTUNE
A Report Prepared for Members of the United States Congress
November 1974
Summary
Evidence collected from a variety of public
documents indicates that the Rockefeller fortune, although nominally
distributed among many individual members of the Family, is actually
coordinated under a central management. We have identified a
number of persons, who, as employees of the Rockefellers, not only
advise the Family on its personal investments but also represent its
collective interests on the Boards of Directors of dozens of major
corporations. This coordination of capital resources also appears
to include moneys held in trust funds, moneys held by tax-exempt
philanthropies set up by the Family, and even some moneys of non-Family
institutions.
The picture of an enormous concentration of
economic power, which follows from this evidence, stands in sharp
contradiction to the usual public image - and the recent Congressional
testimony - which the Rockefellers have presented. It is hoped
that many questions raised by this report will be taken up in
continuing investigations by the Congress.
____________________________________
Inside Cover ... Authors &
Preface
Page 1 ......... Index to Significant Findings
Page 3 ......... Overview and Some Questions
Page 13 ........ Detailed Information
G. William Domhoff, Associate Professor of Psychology, Cowell College,
University of California, Santa Cruz, CA.
He has published three books on topics relevant to this report:
"Who Rules America?" Prentice Hall (1967)
"The Higher Circles" Random House (1970)
"The Bohemian Grove and Other Retreats" Harper & Row (1974).
Charles L. Schwartz, Professor of Physics, University of California,
Berkeley, CA.
His writings on science and public affairs have been published in "The
Bulletin of the Atomic Scientists", "The Nation" and by Scientists and
Engineers for Social and Political Action.
Preface
Along with many other people, both in and out
of academic circles, we have been interested in how economic and
political power really work in present day America. The occasion
of Nelson Rockefeller's nomination to be Vice-President - with the
careful Congressional investigation that has been promised - provides a
unique opportunity to learn more about the usually hidden facts
governing large personal and family fortunes. Quite apart from
the question of whether Mr. Rockefeller is finally confirmed for
this high office, we thought that we should take every advantage of
these Congressional hearings to try to achieve some useful public
education on the realities of large concentrations of money.
A fruitful investigation by the Congress needs
the very best in background research and preparation. Our
intention is that this report may be a useful supplement to the efforts
that Congressional staff have already put into this enterprise.
Our sources of information are all in the
public library. We have collected many bits of information about the
Rockefeller Family financial activities and have tried to assemble them
into a meaningful picture. We believe that much of what we have
assembled here is both new and important, when compared to any existing
writings on this subject that we are aware of. Anyone reading
this report will find a great many questions to ask about the full and
true scope of the picture whose bits and pieces we have tried to
assemble here. We invite you to join in the search for some
answers.
-1-
Index to Significant Findings
The Rockefeller Family fortune is managed out of the headquarters on
the 56th floor of 30 Rockefeller Plaza, New York City. (page 14)
Fifteen employees of the Family, working out of this office, have been
identified on the boards of directors of nearly 100 corporations over a
number of years. (pages 15-18)
These include many of the advanced technology ventures usually
associated with brother Laurance, but there are also many large, well
established corporations. Their combined assets add up to 70
billion dollars. (page 20)
Nelson Rockefeller is personally associated with this Family office and
he has participated as a partner in Laurance's investments. (pages
21-23)
Nelson Rockefeller's own investment portfolio is managed by the same
employee who manages other Rockefeller Family investments; and his
trust funds are held at the Chase Manhattan Bank, on whose board of
directors sit both his brother David and also this same chief money
manager for the Family. (page 25)
Trust funds set up for Nelson's children are under the control of these
same intimate Family employees and money managers. (pages 26, 27)
Some of these Family employees serve both as advisers on the Family's
business investments and also as officers of its tax-exempt
philanthropies. Some evidence points toward a coordination of
investments between these separate reservoirs of capital. (pages 29-31)
Further evidence suggests that investments of Yale University's
endowment funds (supervised by the Rockefeller Family's chief
investment manager) may have been coordinated with the Family's private
investments. (page 32)
A tabulation of corporate director interlocks has been carried out,
yielding a staggering image of the Family's deep penetration into the
whole of the country's corporate economy. (pages 35-37)
-3-
OVERVIEW - ROCKEFELLER ECONOMIC POWER
SOME QUESTIONS FOR NELSON A. ROCKEFELLER
By G. William Domhoff
Last December, during a CBS television special
on the Rockefeller family, Nelson A. Rockefeller told the nation that
his family does not own more than "one or two percent of any company",
and thus has "no controlling interest of any substance except in
Rockefeller Center."[1] On the opening day of the recent Senate
hearings preliminary to his possible confirmation to the Vice
Presidency, he claimed there is a "myth or misconception about the
extent of the family's control over the economy of this country,"
adding that he hoped the myth or misconception "will be totally brought
out and exposed and dissipated."[2]
Rockefeller's assertions about his family's
alleged lack of economic power raise a number of important issues about
ownership and control in the United States economy that are usually
shrouded in a great deal of secrecy and confusion. His testimony
before the Senate and House Committees in November would be an ideal
opportunity to remove some of the mystery about the involvement of
wealthy people in the American economy. By detailed questioning
on family investments, family foundations, family trust funds, and Wall
Street "street names," it might be possible to learn whether or not
Nelson A. Rockefeller and his family are as economically powerless as
he repeatedly claims them to be.
Rockefeller Family &
Associates
One good place to begin careful questioning of
Nelson A. Rockefeller concerning his economic influence is with the
family investment agency of which he is a part, Rockefeller Family
& Associates. Very little is
_____________
[1] CBS Reports, "The Rockefellers", December
28, 1973.
[2] Linda Charlton, "Rockefeller Lists Total
Holdings at $218 Million," The
New York Times, September 24, 1974, page 1.
-4-
known about the size, budget, and
functions of this family organization, but we do know that it is one of
Nelson's business addresses (and thus an area of legitimate concern);
that Nelson participates in many of its investment ventures; that the
head of the organization manages Nelson's stock portfolio; and that
many of its major employees sit on dozens of corporation boards
(including some of the largest companies in the country) as explicit
representatives of the Rockefeller family.[3]
That Nelson A. Rockefeller and his
family may exert a coordinated influence on major corporations through
Rockefeller Family & Associates is suggested by the example of how
the Rockefellers became involoved in Chrysler Motors. Jules
Abels, in his adulatory book on The Rockefeller Billions,
tells the story as follows:
Its (Rockefeller Family &
Associates') security analysts make recommendations upon which each
Rockefeller may act differently, or possibly they may act in
concert. Such a recommendation that was adopted by them was the
investment in Chrysler in the spring of 1962, when it was selling for a
fraction of its present market value.[4]
The notion of the Rockefeller family exerting
influence on Chrysler Motors is supported by the fact that the hired
employee who manages Rockefeller Family & Associates, J. Richardson
Dilworth, became a member of the Chrysler board of directors after the
Rockefellers purchased their stock. Says Abels:
The cumulative investment was large
enough to enable them to put the president of Rockefeller Brothers,
Inc. (the former incarnation of the the present Rockefeller Family
& Associates), J. Richardson Dilworth, on the board of directors of
Chrysler.[5]
Since it takes a substantial stock position
(which may be as small as a few percent in today's economy) for a
stockholder or stockholding group to be invited onto the board of a
large company, it would seem an important question to find out just how
much the Rockefellers
______________________
[3] For further information on Rockefeller Family & Associates, and
detailed findings on the corporate connections of the Rockefeller
family employees, see the accompanying report by Charles L. Schwartz.
[4] Jules Abels, The
Rockefeller Billions, Macmillan, 1965, p.344.
[5] Ibid., pages 344-345.
-5-
own in this company, and how J.
Richardson Dilworth became a part of its board of directors, for Nelson
A. Rockefeller is part of a family organization that may have
substantial influence on Chrysler policies.
Following the same line of reasoning as seems
to be clear in the Chrysler case, it also would be essential to look
into the role of Rockefeller Family & Associates in the following
companies, for J. Richardson Dilworth is among the directors in each
case: International Basic Economy Corporation, Chase Manhattan Bank, R.
H. Macy & Co., Selected Risk Investments, S.A., and Omega Fund, Inc.
Moreover, the exact amount of Rockefeller
family involvement in many other companies should be scrutinized, for
several other employees of the family sit on dozens of corporate
boards. In addition to the already-mentioned Chase Manhattan
Bank, Chrysler Motors and R.H. Macy & Co., the following are in the
big-business category in terms of assets or sales: S.S. Kresge, C.I.T.
Financial, Bendix, American Motors, I.B.M., Crum & Forster, Eastern
Airlines, Lincoln First Banks.
After determining Rockefeller Family &
Associates involvement in each of these companies, it would be useful
to determine the involvement of each of the companies with the
others. It might be discovered thereby that some of the companies
own a significant amount of stock in some of the others, thereby
concentrating
even more stock voting power in the hands of employees of the
Rockefeller family.
Foundations and Universities
However, it would not be enough to question
Nelson Rockefeller about the direct involvement of Rockefeller Family
& Associates in these many businesses, and about the connections of
these companies with each other. To gain further insight into the
family's possible role, it would be necessary to inquire about the
stockholdings of various non-profit organizations which the Rockefeller
family has created, in order to see if these organizations also hold
significant amounts of stock in companies where the family has direct
holdings as well. In this line of questioning it would be
essential to find out the persons in the non-
-6-
profit organizations who have
voting rights on these stockholdings.
One place to start such questioning would be
with the stock portfolios of the non-profit, Rockefeller-financed
organizations where the aforementioned J. Richardson Dilworth is a
member of the board of trustees. These oganizations are
Rockefeller University and Colonial Williamsburg.[6]
The investment portfolios of two foundations
bearinmg the Rockefeller name should be studied. They are the
Rockefeller Brothers Fund, which operates out of the offices of
Rockefeller Family & Associates, and the Rockefeller Foundation. In
the case of the Rockefeller Foundation, the persons in control of
voting the foundation's stock should be ascertained, for this
foundation has many trustees who are not Rockefellers or Rockefeller
employees, and could not be assumed automatically to be under the
control of the Rockefeller family despite its origins.
If the holding of these various profit and
non-profit organizations directly related to the Rockefeller family
were totaled, a pattern might begin to emerge as to the extent of
Rockefeller influence in the economy. We ight begin to see the
kind of picture that was suggested in a 1963 House study by Wright
Patman which showed the following top stockholders in Chase Manhattan
Bank:
David
Rockefeller
1.03%
Rockefeller Bros. Fund .73%
Rockefeller Center
.62%
Total Rockefeller Holdings 2.38% [7]
_______________________
[6] Mr. Dilworth also holds top positions in non-profit institutions
that were not created by Rockefellers. He is chairman of the
finance committee at Yale University, where he manages a $500-plus
million endowment along with John Hay Whitney and William
Scranton. He is president of the Institute for Advanced Study,
Princeton, and vice president of the Metropolitan Museum of Art.
[7] Fifteen of the other top stockholders at Chase were "street names"
that organize trust funds and other assets at major banks. The
problems presented by street names will be raised shortly. See
Wright Patman, Chain
Banking: Stockholder and Loan Links of 200 Largest Member Banks,
Washington, 1963.
-7-
The
possible picture that might emerge is even clearer in another Patman
report, which lists Mobil Oil assets held by Rockefeller-related
organizations as of 1966:[8]
Foundation
|
Mobil Oil Shares
|
Market Value
|
Rockefeller Foundation
|
600,000
|
$28,050,000
|
| Rockefeller Bros. Fund |
404,832
|
$18,925,896
|
| Sealantic Fund, Inc. |
3,601
|
$35,908
|
| Sleepy Hollow Restorations |
34,000
|
$1,589,500
|
| Colonial Williamsburg |
142,000
|
$6,620,750
|
| China Medical Board of N.Y. |
17,000
|
$731,000
|
| Rockefeller Institute |
1,090
|
$46,870
|
Totals
|
1,202,523
|
$55,999,924
|
That the Rockefellers use these family-controlled
institutions in an organized, concerted way is suggested in a story on
the recent problems of a struggling young company, BioMedical Sciences,
Inc., where an "informal committee" of major debtholders has ousted
the company's founder and major stockholder as chairman, president, and
chief executive officer. Among the noteholders listed as part of
the informal committee represented by a major Wall Street law firm are
"Investment vehicles of various Rockefeller interests, including
several unidentified members of the Rockefeller family, and Rockefeller
University, Rockefeller Center, Inc., Rockefeller Brothers Thrift Plan
Trust, and Colonial Williamsburg Special Contingencies ..."[9]
Personal Holdings and Trust
Funds
Unfortunately, an understanding of Rockefeller
economic power would remain incomplete even if it were shown that the
seeming dispersal of stock in certain corporations was a dispersal
among various profit and non-profit organizations controlled by members
of the family and their employees. This is because we are not
permitted by banks to know the exact size or the controlling ownership
of the large trust funds in their possession.
______________________
[8] U.S. House of Representatives, Select Committee on Small Business.
Subcommittee Chairman's Report. Tax Exempt Foundations and
Charitable Trusts: Their Impact on Our Economy.
Washington, 1968.
[9] Barry Kramer, "Bio-Medical Sciences Fires Its Chairman Under
Pressure by Noteholders, 4 Rebels," Wall Street Journal,
October 21, 1974, page 8. For further evidence of coordination
among Rockefeller institutions, see the accompanying report by Charles
L. Schwartz.
-8-
Because
trust funds render the ownership of major corporations to the realm of
speculation, questioning of Nelson A. Rockefeller about his and his
family's trust funds should be detailed and precise. It could
begin with the case of International Basic Economy Corporation, one of
the large companies mentioned earlier as having on its board J.
Richardson Dilworth of Rockefeller Family & Associates.
The International Basic Economy Corporation
was founded in 1947 by Nelson Rockefeller to make investments in a
variety of South American enterprises, including poultry raising,
supermarkets, housing, agribusiness, and textiles. Beginning with
a mere $3 million from the Rockefeller brothers, and $21 million from
Standard Oil companies, IBEC today is a multinational conglomerate
worth several hundred million dollars. It now has interests in
the United States, Canada, Western Europe, Africa, and Asia as well as
South America.
J. Richardson Dilworth is chairman of IBEC.
Rodman Rockefeller, Nelson's son, is the president. Among its
directors are Robert Purcell, a Rockefeller family employee, and Louise
Boyer, a special assistant to Nelson Rockefeller. Members of the
Rockefeller family own a majority of the common stock. It would thus be
of interest to learn why Nelson Rockefeller would claim that the only
company where his family has strong economic influence is the
Rockefeller Center.
Even more important than this possible
oversight on Mr. Rockefeller's part is the nature of his relationship
to IBEC. He is listed by the company as an owner of a very
considerable minority of the common stock, but he disclaims any
controlling relationship to it. Questioning about the three
different trust arrangements for his stock might lead to insight into
the relationship of ownership and control in large corporations, for
here is a "Rockefeller" company if there ever was one, and yet Nelson
Rockefeller, its founder, disclaims any influence within it.[10]
___________________
[10] For further information on personal holdings and trust funds held
by the Rockefellers, see the accompanying report by Charles L. Schwartz.
-9-
Pehaps
the most intriguing of Mr. Rockefeller's IBEC trusts is the large IBEC
stock trust beneficially owned by him but held "of record" by Chase
Manhattan Bank. This trust links Nelson Rockefeller and IBEC
directly to the financial policies of the Chase Manhattan Bank, and
thus opens the Chase as an even more immediate area of concern in
considering the economic power of Nelson Rockefeller than did the
already-cited involvement of Rockefeller Family & Associates,
Rockefeller Center, Rockefeller Brothers Fund, and David Rockefeller in
this giant, world-wide banking concern.
Chase Manhattan Bank -- Trust
Funds and "Street Names"
Trust funds such as those held by Nelson
Rockefeller and his family in IBEC make the ownership and control of
large corporations very difficult to ascertain with any
certainty. More is leaked out about the CIA, the National
Security Council, and even Watergate than usually is known about who
owns and controls the largest blocks of stock in most major
corporations.
The problems that trust accounts create are
made clear in the case of the Chase Manhattan Bank. The bank will
admit to having voting rights over about half of its $16.6 billion in
trust aassets, but it is reluctant to reveal the size of its holdings
in specific companies or the names of the beneficial owners who have
voting rights over stock the bank has in its custody. Thus, the board
of directors of Chase Manhattan Bank will tell us only the 20 largest
holdings of the bank's trust department without revealing the size of
these holdings. Nor will the directors report how much of the
voting power vested in these stocks is held by the bank, by the
beneficial owners, or a combination of the two.
Four of Chase's ten largest holdings are in
Exxon (second largest holding), Mobil Oil (third largest), Standard Oil
of California (seventh largest), and Standard Oil of Indiana (10th
largest). Since these four oil companies are the major part of John D.
Rockefeller's original Standard Oil Trust, it might be very pertinent
to know how much of the holdings in each of these companies are voted
by Chase Manhattan Bank (a. for members of the Rockefeller family; b.
for pension funds;
-10-
c. for other persons and
organizations); Rockefeller Family & Associates, Rockefeller
Foundation, Rockefeller Brothers Fund, Rockefeller University,
Rockefeller Center, Rockefeller family lawyers (as spokesmen for
trusts), and Rockefeller family members.
Although Chase Manhattan Bank has been
hesitant until very recently to reveal the exact size of its holdings
in major companies, many corporations regulated by the government have
been required to divulge the names of their top 30 stockholders.
In a geat many cases these large holdings are found to be in Chase
Manhattan Bank under such "owners" as Cudd & Company, Kane &
Company, and Eggers & Company. These little-known,
strange-sounding organizations are the "street names" or "nominees'
under which the banks organize the stocks and other assets that they
hold for beneficial owners. Some banks have 20 to 30 street names
in which they hold various accounts -- Chase is one of the largest with
25 street names.
Bankers insist that street names are used for
purely administrative purposes, but such street names nonetheless cut
the public off from any understanding of the actual ownership and
control of large corporations. Thus, the 8.3% of American
Airlines stock held by Chase Manhattan in 1972 is listed as being held
by Kane & Co., 1,175,257 shares; Gooss & Co., 306,600 shares;
Cudd & Co., 251,856 shares.
In short, Rockefeller economic power in a
number of corporations may be buried in street name accounts at the
Chase Manhattan and other banks. It therefore might be fruitful
to pursue a line of questioning that revealed the cumulative impact of
Rockefeller family trust funds. First, it would be necessary to
learn Rockefeller voting rights for any company in which Chase
Manhattan Bank's trust department holds more than 1% of the stock.[11]
We should know for such companies (and there
are dozens), just how much of the stock is voted by people and
organizations listed above.
__________________
[11] This includes the Chase Manhattan Bank itself. Who owns the stock
in the street names that held several percent of Chase stock in 1962 ?
-11-
Second,
it might be useful to find out more about how street names are used in
relation to trust funds. Most importantly, now that government
investigators working with Senator Lee Metcalf have learned that some
street names relate to a few major accounts, it would be interesting to
know if Rockefeller family trusts are organized under a few street
names. Specifically, it could be ascertained:
a. if the Rockefeller family as a whole or any of
its members use any Chase Manhattan street names for their
stockholdings;
b. if the Rockefeller family as a whole or any
of its members use street names at any other banks or financial
institutions for their holdings;
c. if any of the previously-mentioned
Rockefeller-affiliated organizations use specific street names at Chase
Manhattan and/or other banks to organize their stockholdings.
Conclusion
If these various lines of questioning were
followed, it might be possible to piece together the actual economic
power of the Rockefeller family. Then it could be determined if
the cumulative effect of various trust funds and family-related
organizations is of significant impact on Chase Manhattan Bank and
various large corporations.
The possible results of such an investigation
can be highlighted in a series of propositions:
1. If Rockefeller Famly & Associates
functions as we think it does, then Rockefeller economic influence is
large;
2. If Rockefeller family holdings and the
holdings of Rockefeller-related organizations are as influential in
Chase Manhattan Bank as they seem to be, then Rockefeller economic
influence is very large;
3. If Chase Manhattan Bank has the vast power
over corporations, through control over credit as well as control over
stock, that is suggested in the reports produced by Wright Patman and
Lee Metcalf, then Rockefeller economic power is enormous.[12]
______________
[12] For a discussion of the means by which Chase Manhattan Bank
exercises considerable control over the airlines industry, see the
statement by Reuben B. Robertson III and Mimi Cutler in Corporate Disclosure, Part
I, March 21, 26, and 28, 1974, pages 197-216. This is the report
of Hearings before the Subcommittee on Budgeting, Management, and
Expenditures and the Subcommittee on Intergovernmental Relations of the
Committee on Government Operations, United States Senate.
-12-
In any
case, it is necessary, as Nelson A. Rockefeller himself has suggested,
that any "myth or misconception" about the extent of his family's
control over the economy should be "brought out and exposed and
dissipated." Such an exposure would be of far greater value than
the ephemeral details of Rockefeller loans to political subordinates
and Rockefeller-financed books about political opponents, for it would
reveal the enduring basis from which such examples of Rockefeller power
and influence have sprung for three generations.
-13-
DETAILED INFORMATION COLLECTED
ABOUT ROCKEFELLER FAMILY FINANCES
by Charles Schwartz
I. Rockefeller Family & Associates
II. Personal Holdings and Trust Funds
III. Foundations and Universities
IV. Corporate Interlocks
I. Rockefeller Family &
Associates
Anyone who has an opportunity to look through
the annual reports of a number of major corporations may find an
individual on the Board of Directors who bears the identification,
"Rockefeller Family & Associates". (RF&A for short) That
is how I became involved in this study. As a professional
scientist and someone who has become interested in exploring the ways
in which science is tied into other aspects of American life, I
recently started looking at some of the business corporations which are
known as leaders in advanced technology. I quickly discovered two
representatives of RF&A who sat on the Boards of Directors of a few
such companies. Looking up the listings for these two men in
"Who's Who" I was able to collect a sizeable list of corporations which
they directed. I also found the business address for Rockefeller
Family & Associates - 30 Rockefeller Plaza, New York, N.Y. 10020 -
and so I sent them a letter of general inquiry early this year.
The reply I received is reproduced below.
-14-
30 Rockefeller Plaza
New York, N. Y. 10020
Room 5600 CIrcle 7-3700
April 19, 1974
Professor Charles Schwartz
Department of Physics
University of California, Berkeley
Berkeley, California 94720
Dear Professor Schwartz:
In your letter of April 3rd you requested
information concerning this office.
Established by John D. Rockefeller, Jr. to
provide personal services and advice to members of his family, this
office is not a corporate entity but a group of privately employed
individuals. The staff provides legal, investment, management,
philanthropic, accounting and a number of other services to family
members and certain other organizations.
Published information concerning the office is
not available, but should you have a specific interest in mind perhaps
I can be of further help.
Yours truly,
Edward H. Burdick
Rockefeller Family & Associates
-15-
Accepting this invitation to further inquiry I wrote back to Mr.
Burdick, describing my findings about the two RF&A representatives
already mentioned and going on to describe my interest as follows. "My
(scientific) curiosity was thus caught with the suggestion that there
may be some substantial overlap, coordination or intercommunication
among a number of technologically involved businesses at the top
management level; and I am seeking information which might indicate how
extensive this overlap is. Thus, the sort of information which I
would be very happy to obtain from you would be data on what other
individuals work parallel to the two gentlemen I mentioned above, what
other companies are thus connected with your office, etc." This
second letter was never answered.
By conducting a rather extensive library
search I have been able to identify fifteen representatives of the
Rockefeller family - employees working out of the office, "Room 5600",
at 30 Rockefeller Plaza - and the large number of corporate Boards of
Directors they have sat on over a number of years. These findings
are listed below.
(Sources: Marquis' Who's Who, over many years;
Dunn & Bradstreet's Million Dollar Directory; Standard & Poors
Register and other business reports; Moody's business manuals; The Wall
Street Journal; The New York Times; Annual reports and stock
prospectuses by various corporations; various newspaper, magazine, or
other articles, found by chance, which give clues to what names one
should search for in the abovementioned sources.)
Representatives of the Rockefeller
Family and the
Corporate Directorships They
Have Held Over Many Years
Louise A. Boyer:
Director of International Basic Economy Corp. (IBEC) since 1953. This
company was founded by Nelson Rockefeller and Ms. Boyer's principal
occupation is listed by the company as "Assistant to Nelson A.
Rockefeller."
Reginald G. Coombe: A
Director (through 1966) of
National Bank of Westchester
U.S. Borax & Chemicals
First New Haven National Bank
-16-
Peter O. Crisp: Identified
with RF&A since early 1960's; a Director of
International Basic Economy Corp.
New England Nuclear Corp.
Crum & Forster
Clarcan Petroleum
J. Richardson Dilworth:
Identified with RF&A since 1958; a Director of
Rockefeller Center
R.H. Macy
International Basic Economy Corp.
Chase Manhattan Bank
Diamond Shamrock
Chrysler
Selected Risk Investments, S.A., Luxembourg
Omage Fund
Youngstown Sheet & Tube
Carbon Limestone
United Nuclear
Picklands Mather
Rockwell Mfg.
Commonwealth & European Investment Trust
Provident Loan Society
Trans America Overseas Finance
Dilworth was President of Rockefeller Brothers, Inc., the predecessor
organization to RF&A, and is described in some current newspaper
articles as the head of RF&A.
George L. Hinman:
Identified as special counsel to the Rockefeller brothers since the
early 1960's; a Director of
International Business Machines Corp.
New York Telephone Company
Lincoln First Banks
First City National Bank of Binghamton, N.Y.
Security Mutual Life Insurance
IBM World Trade Corp.
Warren T. Lindquist:
Identified with Rockefeller & Associates and also as David
Rockefeller's aide, as executive vice president of the Downtown-Lower
Manhattan Association, Inc., in 1967; also a Director of Laboratory for
Electronics in 1963.
John E. Lockwood:
Identified as the close personal and legal adviser to the Rockefeller
brothers; a partner in the law firm of Milbank, Tweed, Hadley &
McCloy; also a Director of
Greenwich Savings Bank
Rockefeller Center
Rockefeller Brothers, Inc.
National Bank of Westchester
International Basic Economy Corp.
-17-
Randolph B. Marston:
Identified with RF&A since late 1950's. Deceased 1970. Was a
Director of
Scantlin Electronics
Cutler-Hammer
Aircraft Radio
Stavid Engineering
Robert W. Purcell:
Identified as "Consultant" to RF&A since late 1950's; A Director of
C.I.T. Financial Corp.
International Minerals & Chemicals
Investors Group
Investors Mutual Fund of Canada
Investors International Mutual Fund, Ltd.
Manhattan Fund
Paribas
Agricultural Insurance Co.
Bendix
Caneel Bay Plantations
Seabord World Airlines
S.S. Kresge
Chemway
International Basic Economy Corp.
Industrial & Mining Development Bank of Iran
Anelex
Pakistan Industrial Credit & Investment
Investors Syndicate of Canada
Hemisphere Fund
Basic Resources International, S.A.
Mauna Kea Beach Hotel Corp.
Carl E. Siegesmund:
Identified as a representative of the Rockefeller family on the Board
of a bank in 1960; a Director of
National Bank of Westchester
Merchants Fire Assurance of N.Y.
Merchants Indemnity Corp.
Charles B. Smith:
Identified with RF&A since 1961; a Director of
AVX Ceramics
Ventron
Thermo Electron
Intel
Aerovox
Fansteel
Electronic Specialty
Plasmachem
Coherent Radiation
-18-
M. Frederik Smith:
Identified with RF&A since 1965; a Director of
Mallinkrodt Chemical Works
Howard Johnson
Perini Corp.
American Motors
Americal Capital Life Insurance
Scantlin Electronics
Theodore C. Streibert:
Identified as a member of the business staff of Nelson and Laurance
Rockefeller 1957-60; during which time he was a Director of Ward Baking
Co.
Theodore F, Walkowicz:
Identified with RF&A since 1952; a Director of
Evans & Sutherland Computer Corp.
GCA Corp.
Itek
CCI-Marquardt
National Aviation
Iomec
Mitre
Riverside Research Institute
Scantlin Electronics (Quotron Systems)
Cerro
Poccantico Oil & Gas
Cryonetics
FMA Corp.
Mithras, Inc.
Thiokol Chemical
United Nuclear
U.S. Borax & Chemical
Safetran Systems
Airborne Instruments Laboratory, Inc.
Vertol Aircraft
Cornell Aeronautical Laboratory
Harper Woodward:
Identified with Laurance S. Rockefeller and with RF&A since 1946; a
Director of
Eastern Airlines
Itek
GCA Corp.
CCI-Marquardt
General Applied Science Laboratories
James Talcott, Inc.
Mithras, Inc.
Thermo Electron Engineering Corp.
Flight Refueling Corp.
Nuclear Development Corp. of America
Dorado Beach Hotel Corp.
Airborne Instruments Laboratory, Inc.
Aircraft Radio, Corp.
Stavid Engineering
Vertol Aircraft
-19-
This list adds up to 118 Directorships in 97
different companies. There may of course be other people and
other companies tied to RF&A which were not discovered in this
search; there are indications that at least some of the Family's
representatives keep their "Rockefeller" label obscured from general
view.
Thus, T.F. Walkowicz is listed on the Board of
The Mitre Corp. as President of National Aviation Corp. M.
Frederick Smith is listed as a Director in the annual reports of
American Motors Corp., with only the identification, "Business
Consultant, New York, New York." George L. Hinman joined the
Board of Directors of IBM Corp. in 1963 and the company's annual report
for that year contains the statement that he is "special counsel to the
Rockefeller brothers"; however, ever since that year he is listed in
the company's annual reports simply as being with the law firm of
Hinman, Howard & Kattall in Binghamton, New York. This
appears to be especially disingenuous in view of Mr. Hinman's recent
disclosure that in 1960 he "closed his law practice to become
Rockefeller family counsel, which remains his sole source of livelihood
today." (Article published in the San Francisco Chronicle, October 28,
1974 page 8.)
In the course of this research a number of
other people, not on the above list, were found who could plausibly be
guessed to have acted as Rockefeller representatives on some corporate
Boards. These people were members of law firms, investment
houses, and individuals with a history of close association with
Rockefeller affairs. However, lacking any documentary evidence
that these people were in fact representatives or employees of the
Family, they have not been listed here.
From the entire list of corporations above, on
which we have identified Rockefeller Family representatives on the
Board of Directors, there are about 40 which are current. (By "current"
we mean as of 1972 or 1973, reflecting data contained in the most
recently published business reference books.) This current set includes
many very large corporations:
-20-
Corporations with over $1 billion
in assets or annual sales (as tabulated by
FORTUNE magazine for 1973)
with an RF&A representative on the Board
American Motors
|
Eastern Airlines
|
Bendix
|
I. B. M.
|
Chase Manhattan Bank
|
S. S. Kresge
|
Chrysler
|
Lincoln First Banks
|
C. I. T. Financial
|
R. H. Macy
|
Crum & Forster
|
|
The combined assets of all these corporations is about $ 70
billion. This picture of Rockefeller Family's active presence in
the world of big business is quite different from that which is most
commonly projected -- namely, that brother David is the Chairman of the
Chase Manhattan Bank and the other brothers have their own hobbies,
rather unconnected to the arena of high finance.
A large number of the companies listed as
having RF&A representation may be described as medium-sized (a few
millions, occasionally reaching into the hundred million dollar class)
and involved in advanced technology of one sort or another.
Laurance Rockefeller is usually described as the brother whose interest
in "gadgets" has led him to invest in a number of such companies as
they were developing new products. (We shall see shortly that he
did not undertake these investments alone but was joined by other
Family members.) Some insight into this "venture capital"
activity of the Rockefellers can be found in the following remarks
delivered in a lecture by RF&A associate Charles B. Smith.
(Published in the Proceedings of the second annual management seminar
at Boston College, May 28-29, 1970, entitled "Venture Capital and
Management")
" We are a relatively loosely
organized group of a few people who attempt to invest some of the
personal funds of a wealthy family in high risk and potentially high
reward companies ordinarily included within the loose, current meaning
of venture capital. We concentrate on advanced technologies,
generally in the early life of companies, including start-ups. We
are primarily equity investors."
" Our goal like everybody else's, is to make wads and wads of
money for the family."
" We are known, I guess, as relatively hard dealers for our
dollars in that we don't like to give them away. We feel that it
is not only cheating our employers but is also unfair to the
entrepreneur. When we invest, we really think our money is the
cheapest; it's
-21-
no strings, generally.
Afterwards, we are generous with the management's incentives."
" In 1960 (but no longer, thanks to Mr. McNamara), you could
finance a technological company on government supplied R&D
contracts. You could also build up your capital equipment portfolio
because the government would do that, too."
Mr. Smith told that the Rockefellers had attempted to establish a
similar venture capital activity in Europe in 1960; but that failed.
One reason he gave was the lack of "enlightened attitudes of the
governments toward the scientists" which is described above.
Other problems had to do with the style of management found there as
compared to this country.
"...there is no lust for the jugular
..."
" Also, we use in this country the incentive of the stock options
- making every man a millionaire. We were absolutely unable to
really get the message across to even the most educated of the people
we ran into (in Europe), what 'equity ownership' was; it was absolutely
meaningless to them."
-----------------------------------
Nelson Rockefeller's
Connection :
The basis for the present Congressional
investigation into Mr. Rockefeller's finances is his nomination to the
Vice-Presidency. We can anticipate the claim that his personal
finances are the only proper subject of inquiry at this time and that
questions about the finances of other members of the Family would be an
improper invasion of their privacy. What is the connection of
Nelson Rockefeller to Room 5600 and to the activities of RF&A ?
The New York City - Manhattan telephone
directories (for 1972-73 and 1973-74) contain the following listings.
Rockefeller Family &
Assocs 30 Rokfelr
Plz CI 7-3700
Rockefeller John D 3d
b 30 Rokfelr
Plz CI 7-3700
Rockefeller Laurance S
b 30 Rokfelr
Plz CI 7-3700
Rockefeller Nelson
A
b 30 Rokfelr
Plz CI 7-3700
(b means business)
Also listed at this same address and phone number are Messrs. Dilworth,
Hinman, Lindquist, Lockwood, Purcell, Siegesmund, Walkowicz, Woodward.
-22-
Certainly, it does not follow that Nelson
Rockefeller is personally involved in all Family financial affairs; but
it is certainly true that he is not totally disconnected from
them. Here are two examples we have turned up of Family members
investing collectively in "Laurance's ventures."
In April, 1965, The Marquardt Corp. acquired
the assets of General Applied Science Laboratories, Inc. (GASL).
Both were high technology ventures financed by the Rockefellers.
In the prospectus for stock issuance in this transaction there is a
list (page 21 of Listing Application A-22482 to the New York Stock
Exchange, April 27, 1965) of major GASL shareholders and the number of
shares - 2/7 of their total holdings - each will donate in the
transaction:
A.R. Mauze
|
1,172
|
| D. Rockefeller |
2,343
|
| J.D. Rockefeller III |
1,172
|
| L.S. Rockefeller |
22,843
|
| N.A. Rockefeller |
1,172
|
Also included in this list of shareholders were several RF&A
representatives: Dilworth, Marston, Walkowicz, Woodward.
A similar situation was found in a prospectus,
dated May 31, 1967, offering shares in New England Nuclear Corporation.
A list of shareholders includes:
Abby R. Mauze
|
5,964
|
David Rockefeller
|
26,844
|
John D. Rockefeller III
|
5,964
|
Laurance S. Rockefeller
|
45,804
|
and also the same four RF&A people mentioned above.
Looking at the numbers of shares listed in
each case for the various family members, one sees some numerical
regularities. (Abby, John D.III and Nelson all hold identical
amounts in GASL, while David holds almost exactly twice as much; Abby
and John D.III hold identical amounts in New England Nuclear.)
This suggests that they were not independent investors. Most
likely, these numbers suggest that Family members had some kind of
standing agreement to invest collectively.
-23-
At the outset of the hearings before the
Senate Rules Committee Mr. Rockefeller released a list of the
securities
holdings of himself and his family, including both personal holdings
and trust funds. The list (see Wall Street Journal 9/24/74 page
22) includes a good many of the companies we have listed as having an
RF&A representative on the Board. (Aside from the well known Family
enterprises - Chase, IBEC, Rockefeller Center - these include five
companies listed in the billion dollar class and eight of the
technological ventures. Several of these companies appear in more
than one portfolio.)
-----------------------------------
Scope of Activities of
RF&A:
The letter received from Mr, Burdick of
RF&A, reproduced earlier, stated that the office in Room 5600 at 30
Rockefeller Plaza had been established "to provide personal services
and advice" to members of the Family. The information presented above
gives some indication of the scope of those personal services; but we
do not know what fraction of the whole picture we have so far succeeded
in uncovering. Just how big is Room 5600 and how broad is the
scope of its financial management on behalf of the Family ?
Here is one more small clue we have turned
up. The New York Society of Security Analysts has its membership
listed in the annual directory of the Financial Analysts
Federation. The 1973 directory includes a listing of members by
firm affiliation; and under Rockefeller Family and Associates there are
six people listed. (These six people are all different from the
fifteen RF&A representatives we have identified; they presumably do
lower level work than those who get to sit as Directors of the
companies that are chosen for Family investment.) Is six
security analysts a lot ? In the same directory Merill Lynch & Co.
has 103 people listed, but of course they have many thousands of
clients to serve with investment advice. The listing just after
RF&A is for the Rockefeller Foundation: they have only one security
analyst registered (who turns out to be the Treasurer of the
Foundation.) According to their 1973 annual report, the
Rockefeller
-24-
Foundation holds total assets of $840 million. It would be
extremely simplistic to multiply $840 million by six and arrive at an
estimate of $ 5 billion as the size of the investment aggregate managed
by RF&A for members of the Family. Since Nelson Rockefeller
has promised a full disclosure of his finances, he should be asked to
give a full accounting of the activities of the RF&A office - or,
if he is not sufficiently familiar with all the details, Mr. Dilworth,
or whoever else is in charge, should be asked to give this accounting.
-25-
II. Personal Holdings and Trust
Funds
Following Nelson Rockefeller's disclosure of
his and his immediate family's stockholdings, several interesting bits
of information were found in a newspaper article published by the San
Francisco Chronicle on September 30, 1974, page 52. (The article
is credited to the New York Times but I could not find it published by
that paper.)
Alleged was,
1. Trusts No. 1 and 2 for Nelson Rockefeller are managed by the Chase
Investors Management Corp., a subsidiary of the Chase Manhattan Bank of
which Nelson's brother David is chairman.
2. His and his wife's outright holdings as well as Mrs. Rockefeller's
trusts are managed by Rockefeller Family and Associates, under the
supervision of J. Richardson Dilworth, the family's senior financial
adviser.
3. The trusts for the children are managed by the Fidelity Union Trust
Co. of Newark, N.J.
It will be important to get Mr. Rockefeller's
confirmation of these statements, since they strongly confirm the
picture of centralized management of nominally separate portions of the
family's fortune. In particular, it will be important to ask what
is meant by a bank's "management" of some trust fund: Does the bank
control the trust fund or is it merely acting as a custodian? Who
actually decides on the investments and who has the voting rights for
the stock held in the trusts ?
According to an article in NEWSWEEK magazine,
September 2, 1974 (p.21) much of the Family fortune is distributed in
"well over 100 and perhaps 200 individual Rockefeller trusts." In
the CBS News special report on the Rockefellers (broadcast 12/28/73)
commentator Walter Cronkite said,
" There are now nine sons and fourteen
daughters in the Rockefeller family. They are known as the
Cousins. There are 37 grandchildren, and this sizable group
(inheritors of an illustrious name) will inherit the family fortune,
which will inevitably be critically subdivided. For them, less
wealth may mean less power. "
(Quotation from the transcript supplied by CBS News)
-26-
The substantial question to be asked is
whether much of this great fortune, nominally divided into many
individual trust funds, is in actuality managed as a whole.
Some new and pertinent information on this
question has been found in a document we have obtained: the
Notice of Annual Meeting of Stockholders of the International Basic
Economy Corporation (IBEC), May 15, 1972. "Descendants of John D.
Rockefeller, Jr. and members of their families own beneficially, as of
May 1, 1972, all of the 428,960 outstanding shares of Common
Stock-Class 10 and 2,414,219 shares (65.08% of the outstanding shares,
after deducting treasury shares) of the Common Stock." (In the
election of Directors of the company, each share of Class 10 stock is
entitled to 10 votes while each share of regular common stock has only
one vote.) A table on page 5 lists the holdings of the principal
stockholders in IBEC. In summary:
a) 12,255 shares Common, owned
beneficially and of record by Mrs. Nelson A. Rockefeller.
b) 409,900 shares Common, held of record by the Chase Manhattan Bank,
N.A., as trustees of a trust of which Nelson A. Rockefeller is the life
beneficiary.
c) 181,047 shares Common and 168,972 shares Class 10, owned outright by
Rodman C. Rockefeller and Steven C. Rockefeller (Nelson's children) and
including stock held of record by them as trustees for the benefit of
their minor children.
d) 1,388,000 shares Common and 178,788 shares Class 10, held of record
by trustees for the benefit of Nelson A. Rockefeller's children - and
possibly other beneficiaries - in various trusts.
These numbers can be compared with those given in Mr.
Rockefeller's disclosure statement to the Senate in September; they
agree exactly in some categories, vary closely in others.
The most interesting information here concerns
supervision of the trust funds referred to. First, we confirm
that Nelson's Trust fund is held by the Chase Manhattan Bank.
Second, and this is most revealing, the names of the trustees for his
childrens' trust funds are given:
J. Richardson Dilworth, John E.
Lockwood and Laurance S. Rockefeller, trustees of trusts for the
benefit of Nelson A. Rockefeller's minor
children. and,
-27-
John E. Lockwood, Rodman C. Rockefeller
and Louise A. Boyer, trustees of various trusts, including some of
which Rodman and Steven are beneficiaries.
Thus we learn that Nelson's children's trust
funds are under the control of (the IBEC stocks are "Held of record
by") trustees who are intimately involved with the Family's business
activities -- Dilworth, Lockwood and Boyer, along with Laurance and
Rodman.
Notice that item 3. in the newspaper story
mentioned earlier located the children's trust funds as being under
management by a New Jersey bank, while the IBEC report states that
these intimates of the Family are holders of record of this
stock. Some clarification is called for here. (In our study
of corporate interlocks, reported in Part IV of this report, we found
two Directors of the holding company of that New Jersey bank who have
multiple overlapping directorships personally with J. Richardson
Dilworth.)
Mr. Dilworth emerges as the central figure in
coordinating the financial activity of the Family. He is head
of the RF&A office, he sits as a director of several major
corporations (Chase, Chrysler, R.H. Macy the best known among them), he
personally manages Nelson's own stock investments, Mrs, Rockefeller's
trust fund, and at least some of the children's trust funds. The
question waiting for an answer is, How many other Family members'
personal and trust funds are also under the common management of Mr.
Dilworth and RF&A ?
-28-
III. Foundations and Universities
The Rockefeller Family is famous for its
philanthropies. Large parts of the Family fortune have been given over
to tax-exempt foundations and universities. Legally, these moneys
no longer belong to the Family; these endowments are supposed to belong
to the individual foundation or university, to be invested solely in
the interests of that institution. We shall present here some
evidence that there is an effective coordination between the financial
activities of these institutions and those of the Family.
This situation, if proved true for the
Rockefellers, is not unique to them. Consider the following
colloquy between Senator Lee Metcalf and industrialist Norton Simon -
recorded in the Hearings before the Subcommittee on Budgeting,
Management, and Expenditures and the Subcommittee on Intergovernmental
Relations of the Committee on Government Operations, United States
Senate, March 21, 1974. page 25
Senator Metcalf. "Well, now, you
have a foundation which is the source of your many varied
philanthropies. The money in that foundation is invested in
various stocks. Who votes that stock ?"
Mr. Simon. "The foundation."
Senator Metcalf. "Who on the foundation then makes the decision ?"
Mr. Simon. "I do. "
Senator Metcalf. "You make the decision ?"
Mr. Simon. "Yes."
-------------
The Rockefeller Foundation:
This is the largest and best known of the
Rockefeller philanthropies and the one which appears to be least
closely tied to the Family. (John D. Rockefeller III is Honorary
Chairman of the Board of Trustees and there are no other identified
RF&A peopole found there.) The one specific claim we have to
present comes from the book, "Managers and Millionaires" by S.
Menshikov (Progress Publishers, English translation, Moscow
1969). The author was an exchange scholar visiting this country
in 1962-63 who claims to have interviewed many important U.S. business
leaders as part of his research. In discussing the Rockefeller
Foundation, he
-29-
states that in addition to there being a Finance Committee of the
Foundation's Trustees, the Foundation's holdings are administered by
the Chase Manhattan Bank, and "Rockefeller lawyers - Eli W. Debevoise
and others - have the final say on stock voting." (page 260.)
If this claim is proved to be true, it will
have extraordinary implications. It will mean that the
Rockefeller's were able to give away hundreds of millions of dollars
into tax-exempt institutions without losing the economic power which
ownership of that money implies.
Concerning Mr. Debevoise, identified by
Menshikov as a Rockefeller lawyer: He was legal counsel to the
Rockefeller Foundation from 1959 to 1965 (annual reports of the
Foundation.) His father, Thomas M. Debevoise, was legal counsel
to the Foundation until his retirement in 1948 and was earlier a
Director on a number of corporations closely identified with the
Rockefellers (Who's Who 1930-1958); and upon his death the New York
Times described him as "personal counsel for many years to John D.
Rockefeller, Jr. ... He had been regarded as the principal lawyer and
spokesman for Mr. Rockefeller on a wide range of matters related to the
family's business, civic and personal activities." (NYT 12/22/58 page
2) Eli Whitney Debevoise has been a Trustee of Rockefeller
University for many years and has been connected with other activities
closely associated with the Rockefellers, as have been some other
partners in the law firm of Debevoise, Plimpton, Lyons & Gates -
Oscar M. Ruebhausen and Roswell B. Perkins in particular. (Who's Who
over several years)
--------------------
Rockefeller Brothers Fund:
Our information about this tax-exempt
foundation, established by the brothers in 1940, comes from their
annual
reports. According to the most recent one available (for 1972) 15
persons are listed as trustees and more than half of these are members
of the Family; 12 persons are listed as officers of the fund of whom
only two - the chairman and vice chairman - are in the Family, but
three other officers are already identified as employees of RF&A:
John E. Lockwood, who has been legal counsel to the Fund for many
years; Carl E. Siegesmund,
-30-
who was Assistant Treasurer of the Fund
until May 23, 1973; and Edward H. Burdick, Assistant Treasurer of the
Fund since that date. (Mr. Burdick wrote me that original letter
about RF&A.)
The address of the Fund is 30 Rockefeller
Plaza, New York City, but its headquarters is not on the 56th floor and
it has a different telephone number. Nevertheless, the addresses
listed by the Fund for the three officers mentioned above and also for
the Treasurer, David G. Fernald, is "Room 5600, 30 Rockefeller Plaza."
If the same people are involved in managing investments for the Family
and for the Fund, it seems natural that there will be some coordination
of their investment policies. We have found a hint of this.
The total market value of the assets of the
Rockefeller Brothers Fund is reported as $ 268 million in 1972.
The largest holdings in their portfolio are Exxon, Mobil, Standard Oil
of California, Chase Manhattan Bank and Rockefeller Center -- all well
known businesses of the Family, historically if not presently.
The Fund's annual reports include a listing of the portfolio only since
1964; and we found that the next largest single item in their holdings,
after the ones mentioned above, was Chrysler Corporation:
1964: 110,800 shares of Chrysler
common stock, valued at $ 6.7 million
1965: 120,829 shares of Chrysler common stock
1966 through 1970: 80,000 shares of Chrysler common stock plus $ 1.6
million in notes of Chrysler Financial and Realty Corporations.
What makes this so interesting is that J. Richardson Dilworth is a
Director of Chrysler, having been put on the Board and on the Finance
Committee of that corporation in June of 1962 after the Rockefeller
family had taken a stock position in the company. (Chrysler
annual report and Wall Street Journal 6/15/62 page 11)
A search for Chrysler holdings in the annual
reports of several other major foundations over those years was
conducted. Of Rockefeller, Ford, A.P. Sloan, Russell Sage, China
Medical Board and the Carnegie Corp., only the last one was found
holding any Chrysler stock - 25,000 shares - and that only for one year
- 1966.
-31-
Rockefeller University:
This University in New York City, formerly the
Rockefeller Institute for Medical Research, was endowed by John D.
Rockefeller in 1901 with a gift of $ 60 million. Its present investment
portfolio is thought to be in excess of $ 200 million. David
Rockefeller is chairman of the Board of Trustees; other Trustees are J.
Richardson Dilworth and Eli Whitney Debevoise; John E. Lockwood was
Secretary of the Trustees for many years.
A former staff member at the University has
stated that during a student protest involving the University's
investment policies Mr. Rockefeller and Mr. Dilworth appeared as
the spokesmen to say how the stocks would be voted. (private
communication)
An article in a student-staff newspaper
produced at Rockefeller University discussed the matter of Mr.
Dilworth's position on the Board of Directors of Chrysler Corporation,
which we have mentioned above. ("The Newspaper" January 1969) The
article states,
" A check of the University financial
report for the period ending June 30, 1962, shows the appearance of
10,000 shares, worth half a million dollars, of Chrysler where there
had been none the previous year. The Chrysler holdings of R.U.
have since increased."
-----------------
Yale University:
J. Richardson Dilworth is, among other things,
a Trustee of Yale University and has been, since 1962, Chairman of
their Finance Committee. Dilworth is a Yale graduate but
otherwise there was no connection we were aware of between Rockefellers
and Yale. Copies of the Treasurer's Report on the Yale University
endowment funds were obtained for the years 1966-1969 and some
fascinating facts emerged.
The total value of the endowment funds was
about $ 500 million.
-32-
As of 6/30/68 (the earliest
listing that includes the detailed portfolio of stock holdings) they
held 205,000 shares of Chrysler common stock, with a market value of
nearly $ 13 million.
As of 6/30/69 they held 386,766 shares
of Chrysler common stock, with a market value of nearly $ 18 million.
In each case the Chrysler holding was the second largest single item in
the portfolio. (I.B.M. was the largest.)
The 1967 report states, "The investment of endowment funds of
institutions of higher education has been traditionally a function in
which trustees, at Yale and elsewhere, have taken to some extent a
direct administrative role rather than merely a general
supervisory one.
There have been at Yale a succession of devoted Chairmen of the Finance
Committee, all of them eminent New York financiers. They have
spent untold hours on Yale's investments and finances. "
The 1967 report then goes on to describe a new arrangement in which
Yale will set up a private firm - Endowment Management and Research
Corporation, in Boston - to handle its endowment investments. The
management firm is owned half by Yale and half by its own officers, and
it is free to take on other investment management business besides
Yale's. The final selection of people to run this new business
came after "the men on the final lists were interviewed by the Chairman
of the Finance Committee." "The new firm has authority to give
instructions directly to Yale's custodian. There is a list of
approved securities, and regular telephone communication between the
Firm and the Chairman of the Finance Committee." The Board of
Directors of this management firm was to be composed of members of
Yale's Finance Committee along with the firm's top managers.
There is yet one more piece of information to
decorate this story. One of the corporations of which Dilworth is
a Director is The Omega Fund. According to Moody's Bank and
Finance Manual, this is an open end investment fund; Endowment
Management and Research Corp. handles the Fund's investments and
the two organizations share the same address and company
officers. The other outside Directors of Omega Fund, in addition
to Dilworth, are J..P. Grace, D.B. Smiley (Chairman of the Board of
R.H. Macy Co., where Dilworth is also a Director) and Karl Kaysen
(Director
of the Institute for Advanced Studies, where Dilworth is President of
the Board of Trustees.)
Omega Fund was launched in 1968 and their
assets in that first year reached over $ 100 million. According
to the latest reports, their assets have dropped in value to only $ 25
million. (We do not know how Yale's endowment has fared.)
-33-
IV. Corporate Interlocks
During some recent investigations by a Senate
subcommittee which was looking into the ownership and control of the
airline industries the name "Rockefeller Family and Associates" came
up. (Harper Woodward of RF&A is a Director of Eastern
Airlines.) The Committee's Counsel, whose staff had been unable to find
this organization listed in any reference books, asked,
" Do you have any way of telling
us what ownership Rockefeller Family and Associates have and how they
interlock with other companies in the United States ?"
The witness, an official of the Civil Aeronautics Board, replied,
"We do not have that information."
(Hearings before Senator Metcalf's subcommittee, cited earlier, June
10, 1971, entitled, "Advisory Committees" page 31)
With the list given in Part I of this report,
showing a large number of corporations on whose boards of directors
there sits an identified representative of RF&A, it is now possible
to tabulate their interlocks with other companies. The task is a
tedious one but we have done it, focussing our attention on the most
recent year for which reference books are available - nominally
1973. (Dunn & Bradstreet Million Dollar Directory 1974 has
the most complete index of corporate directors by name; Standard &
Poors Register 1973 was useful as a back-up; occasionally Moody's Bank
and Finance Manual 1973 was used for a company not listed in these
other books; and in a couple of cases we had to refer back to Dunn
& Bradstreet's book for 1973; where available, we started out with
Directors as listed in each corporation's annual report - for 1972 but
usually issued early in 1973.) For each company with an RF&A
representative on the Board, each other Director was looked up in these
reference books (and sometimes in Who's Who as well) and a record was
made of every other corporation on whose Board of Directors he also sat
at that same time.
-34-
The gross result of this research is a list of
over 1000 corporate interlocks for Rockefeller Family and
Associates. The list is so huge that we refrain from publishing
it in its raw form for fear of simply drowning the reader. We
sought, instead, some way of choosing and representing the essence of
this tabulation without all of its detail.
It is, of course, arguable just what a
corporate interlock, or a list of corporate interlocks means. It
certainly doesn't mean that Rockefeller owns or controls some company
just because of an interlock with it. At a minimum, it probably
does mean that Rockefeller agents are in effective communication with
those businesses interlocked with them. The hard question - one
which we cannot hope to answer by looking in library books - concerns
measuring the degree of influence which the collective Rockefeller
financial network, acting through RF&A, and possibly other more
submerged allies, exerts on these other companies it is interlocked
with.
We have chosen the simple formula of selecting
out only those companies for which we found more than one interlock
with RF&A. This choice should lessen the criticism that an
interlock can occur sort of by accident if representatives of two
companies really having no connection with each other happen to sit
jointly on the Board of some third company. The resulting list of
multiple interlocking companies was further distilled by selecting only
the larger companies -- we have used the lists published by FORTUNE
magazine (May and July issues 1974) for this selection: The 500 Largest
Industrials, The 50 Largest Commercial Banking, Life-Insurance,
Diversified Financial, Retailing, Transportation and Utility Companies
in the U.S.
The following table contains the results of
this tabulation. The companies are ranked in the order given by
FORTUNE and the numbers in parenthesis give the number of interlocks
which each company has with representatives of the Rockefeller Family
sitting on Boards of Directors.
-35-
For example, the first entry in the table
reads "General Motors (2)." This means that we have found two
cases of a director of General Motors Corp. who also a director of a
company that has a Rockefeller Family representative on its
board. (These two interlocks with General Motors happen to be
with Chase Manhattan Bank and with S.S. Kresge Co.) Another entry in
the table reads "Chrysler (RF&A +1)". This means that
Chrysler Corp. is one of the companies that has a Rockefeller Family
representative on its board of directors (J.R. Dilworth) and there is
also one other interlock between Chrysler's board and the board of
directors of another company with a Rockefeller Family representative
on its board. (In this case this additional interlock is provided by
William R. Hewlett, who is a director of both Chrysler and Chase
Manhattan Bank.)
The list of corporations contained in this
table of multiple interlocking directorates with the Rockefeller Family
represents an immense portion of the entire economic apparatus of this
country. This table includes
6 of the top 10 Industrial Corporations listed by FORTUNE
6 of the top 10 Commercial Banking "
" " "
5 of the top 10 Life
Insurance
" " "
"
and 2 or 3 of the top 10 corporations in the other four categories
listed by FORTUNE.
The combined assets of all the companies
listed here add up to $ 640,000,000,000.
-36-
MAJOR CORPORATIONS HAVING MULTIPLE INTERLOCKS WITH THE ROCKEFELLER
FAMILY
Industrials
|
Diamond Shamrock (RF&A)
|
|
Cerro (2)
|
General Motors (2)
|
Universal Oil Products (2)
|
Exxon (3)
|
Airco (2)
|
Chrysler (RF&A +1)
|
Int'l. Minerals & Chemicals
(RF&A)
|
General Electric (2)
|
Cluett, Peabody (3)
|
Mobil Oil (3)
|
Harris-Intertype (2)
|
I. B. M. (RF&A +4)
|
Carborundum (2)
|
U.S. Steel (3)
|
Sybron (4)
|
RCA (2)
|
Texasgulf (2)
|
Eastman Kodak (2)
|
Gannett (3)
|
Union Carbide (2)
|
Ceco (2)
|
Caterpillar Tractor (2)
|
|
Xerox (4)
|
|
W.R. Grace (4)
|
Commercial Banking Companies
|
General Foods (5)
|
|
Singer (2)
|
First National City Corp. (3)
|
Ralston Purina (2)
|
Chase Manhattan Corp. (David +
RF&A + 3)
|
Honeywell (2)
|
Manufacturers Hanover Corp. (5)
|
Bendix (RF&A +2)
|
Chemical New York Corp. (4)
|
Colgate-Palmolive (4)
|
Bankers Trust New York Corp. (4)
|
American Can (2)
|
First Chicago Corp. (3)
|
TRW (3)
|
Marine Midland Banks, Inc. (3)
|
National Steel (3)
|
Wells Fargo & Co. (2)
|
Uniroyal (4)
|
Charter New York Corp. (2)
|
Republic Steel (2)
|
Mellon National Corp. (3)
|
American Motors (RF&A)
|
First National Boston Corp. (3)
|
FMC (2)
|
National Detroit Corp. (5)
|
Warner-Lambert (2)
|
Bank of New York Co. (2)
|
Allied Chemical (2)
|
Cleveland Trust Co. (2)
|
U.S. Industries (3)
|
Detroitbank Corp. (3)
|
Raytheon (2)
|
Lincoln First Banks, Inc.
(RF&A)
|
Eaton (2)
|
Southeast Banking Corp. (3)
|
Standard Oil, Ohio (2)
|
|
Teledyne (2)
|
|
Nabisco (2)
|
Life-Insurance Companies
|
Kennecott Copper (4)
|
|
Bristol-Myers (2)
|
Prudential (5)
|
Burroughs (3)
|
Metropolitan (5)
|
Illinois Central Inds. (2)
|
Equitable Life Assurance (3)
|
Studebaker-Worthington (2)
|
New York Life (2)
|
Amer. Smelting & Refining (2)
|
Massachusetts Mutual (2)
|
Eli Lilly (2)
|
Mutual of New York (5)
|
Corning Glass (3)
|
New England Mutual (2)
|
Emerson Electric (2)
|
Mutual Benefit (2)
|
Scott Paper (4)
|
|
Carrier (3)
|
|
Avco (2)
|
|
Hewlett-Packard (2)
|
|
-37-
Diversified Financial Companies
|
Retailing Companies
|
|
|
American Express (6)
|
Great Atlantic & Pacific Tea
(2)
|
Continental Corp. (4)
|
S. S. Kresge (RF&A +1)
|
C. I. T. Financial (RF&A)
|
Federated Department Stores (3)
|
Crum & Forster (RF&A)
|
Winn-Dixie Stores (2)
|
|
May Department Stores (2)
|
|
R. H. Macy (RF&A +4)
|
Utilities
|
Marriott (2)
|
|
|
American Tel. & Tel. (5)
|
|
Consolidated Edison (2)
|
Transportation Companies
|
Detroit Edison (3)
|
|
|
Pan American World Airways (4)
|
|
Eastern Air Lines (RF&A +3)
|
The following are sizeable companies not included in the listing by
FORTUNE
U.S. Trust Co., New York (5)
|
Canadian Corporations
|
Fidelity Union Bankcorp, N.J. (4)
|
|
J. Henry Schroder Banking Corp.
(3)
|
Investors Group (RF&A)
|
Bowery Savings Bank (3)
|
Royal Bank of Canada (3)
|
Greenwich Savings Bank (RF&A
+3)
|
Investors Growth Fund (3)
|
Maccabees Mutual Life (2)
|
Investors Mutual of Canada (3)
|
Liberty Mutual Life (2)
|
Great-Western Life Assurance (4)
|
Reliance Insurance (2)
|
Montreal Trust Co. (2)
|
|
Canadian Pacific Ltd. (2)
|
|
International Nickel (2)
|
----------------------------