Paying the Debt

For weeks the rumors had raced through Washington: Jesse Jones was going to get the ax. Last week he got it.

The President has rarely fired anybody, but he swept aging Jesse Jones out as head of the Commerce Department, the RFC, and RFC's eight potent subsidiaries.* The reason was purely political and Mr. Roosevelt made no bones about it. It was to give a job to lame-duck Vice President Henry Wallace.

The President's letter was a "very difficult letter" to write, said Franklin Roosevelt. With his left hand he praised Jesse's "splendid services" to the Government, but with his right he added:

"Henry Wallace deserves almost any service which he believes he can satisfactorily perform. I told him this at the end of the campaign, in which he displayed the utmost devotion to our cause . . . Though not on the ticket himself, he gave of his utmost toward the victory which ensued.

"He has told me that he thought he could do the greatest amount of good in the Department of Commerce, for which he is fully suited. And I feel, therefore, that the Vice President should have this post in the new Administration. . . ."

The President hoped that Jesse Jones would continue to stay in the Government. He told him to drop around and see Ed Stettinius one of these days to see if there was an ambassadorship open. The letter, which began, "Dear Jesse," closed with "warm regards."

"I Have Been Faithful." In a reply written the same day, Jesse Jones bowed out--since there was nothing else he could do--but not without having his say:

"It is difficult to reconcile [your] encomiums with your avowed purpose to replace me. While I want to be of any further service, I would not want a diplomatic assignment.

"I have had satisfaction in my Government service because I have had the confidence of the Congress, as well as your own. I have had that confidence because I have been faithful to the responsibilities that have been entrusted to me. For you to turn over all these assets and responsibilities to a man inexperienced in business and finance will, I believe, be hard for the business and financial world to understand. . . ."

The firing of Jesse Jones culminated the biggest undercover political battle which Washington has seen in many a year. From the very day of election, Franklin Roosevelt's biggest political debt was to Henry Wallace and the C.I.O.'s Political Action Committee, whose hero he is. All efforts to shunt Wallace aside in the Department of Labor came to nothing. Wallace supporters felt that, politically speaking, he would be wasting his time there. Wallace could have what he wanted; what he wanted was Commerce and the lending agencies, with their titanic power in the U.S. economy. His party leader paid off.

* Defense Plant Corp., Defense Supplies Corp., Rubber Reserve Co., Metals Reserve Co., War Damage Corp., Disaster Loan Corp., Federal National Mortgage Assn., RFC Mortgage Co.

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