Glass House

Adlai Stevenson's fund was revealed as a direct result of Democratic excitement over the Nixon fund. Stevenson confirmed that the fund existed, then lapsed into silence. After two aloof days, he rose before a campaign workers' breakfast in Baltimore and coolly indicated that he would not be pushed into giving details. He had used leftover campaign contributions to supplement the salaries of some state officials, he said, and no improper influence was involved. There he intended to let the matter rest. He would not list the names of givers or receivers; "to do so would subject them to publicity which they do not deserve . . ."

Forces at Work. But the newspapers were clamoring for facts. Dick Nixon had made a full report; why shouldn't Stevenson? Jubilant Republicans joined in, asked what Stevenson was trying to cover up. Correspondents on the campaign train submitted a petition asking the nominee for a press conference. Stevenson's answer: No.

In Illinois, newsmen interviewed all 13 state department heads. These officials said that they had never heard of the fund which Governor Stevenson said was no secret. Snorted State Insurance Director J. Edward Day (whose state salary is $10,000 a year): "There isn't any 'Dime for Day' fund, and I don't get anything extra from anybody."

Then some Illinois officials and ex-officials began to recall something about gifts and funds. State Supreme Court Justice Walter V. Schaefer remembered that Stevenson had given him a $500 check for Christmas in 1950 (before he was appointed to the bench), while he was serving as the nonsalaried chairman of a state committee on government reorgan ization. He thought it was a personal gift from Stevenson. This refreshed the memory of Insurance Director Day. He had received something extra after all, in the form of presents from Adlai. So had State Welfare Director Fred Hoehler and former Finance Director George Mitchell, who at first said they didn't remember getting anything.

Two former purchasing agents, William J. McKinney and David H. Cummings, recalled something, too: Stevenson had arranged for a special political fund after he was elected. They thought it was used to support Stevenson's candidates for the legislature and to pay some of his own political expenses. The man in charge of this fund, said McKinney, was the late James Mulroy, former managing editor of the Chicago Sun, who was Stevenson's executive secretary.* Each month Mulroy got a list of firms doing business with the state. Said McKinney: "Mulroy was under orders not to pressure these people. But I think it was his idea to call on them and ask if they cared to contribute."

3 a.m. Call. As the headlines continued to shout about the Illinois funds, signs of nervousness began to appear in the Stevenson camp. Some of the candidate's aides were not so sure that Democratic National Chairman Steve Mitchell should have boldly demanded that Dick Nixon get off the Republican ticket. Finally, Campaign Manager Wilson Wyatt announced that Adlai Stevenson had changed his mind. There would be a "further statement."

It came dramatically. In Indianapolis, the reporters following Stevenson were routed out of bed at 3 a.m. and assembled in a makeshift pressroom. They were handed thick envelopes containing a prepared statement by Stevenson and a bulky audit of the Stevenson-for-Governor Committee's 1948 campaign fund. Stevenson was not on hand; there was no press conference at which the reporters could question the candidate. The prepared statement closed with an announcement obviously calculated to take Stevenson off the defensive: both he and Vice-Presidential Nominee John Sparkman were going to make public their income-tax returns for the past ten years. The unspoken implications: Eisenhower and Nixon should be expected to do the same thing.

Stevenson's statement on the fund went back to the beginning of his term as governor. He found that "key officials" in the state government were receiving too little pay. "I adopted the practice of making gifts, usually around Christmas time, to a small number of key executives who were making sacrifices to stay in the state government ... I need not point out that the single object of these gifts was to improve the quality of public administration in Illinois." Total of the gifts: $18,150 (exactly $85 less than the Nixon fund).

Post-Campaign Funds. The audit showed that at least $13,000 of the surplus in the 1948 campaign fund came from postcampaign contributions, made after Stevenson was elected governor. Among these was one anonymous item of $5,000. entered exactly a week after the election. Many businessmen who sell supplies to the state were on the contributors' list, e.g., Stuyvesant Peabody Jr., president of the Peabody Coal Co., whose firm sells thousands of dollars worth of coal to the state. He gave $500.

Biggest single contributor was Marshall Field Jr., publisher of the Chicago Sun-Times, which is now supporting Dwight Eisenhower. His specified contribution was $7,100, but a note indicated that he had given more on an "anonymous" basis. Among other contributors: the C.I.O.'s United Auto Workers and United Steelworkers unions, $2,500 each.

Explaining why he had been loth to give names, Adlai Stevenson pointed out that Illinois law does not require any public accounting of political contributions, so those who gave did so in the belief that "their privacy" would be respected. Nearly all states now require some accounting of campaign funds, but Governor Stevenson has never proposed such a law for Illinois.

Eight Intimates. On the list of "key officials" who received the money were eight names, all of men close to Stevenson. His $1,500-a-year publicity man, William I. Flanagan, assigned to build the governor into national prominence, had received almost half of the fund: $7,900. Others on the list: Legal Counsel Carl McGowan, $3,000; Insurance Director Day and Welfare Director Hoehler, $2,000 each; ex-Finance Director Mitchell and State Police Superintendent Thomas J. O'Donnell, $1,000 each; Administrative Assistant Lawrence Irvin, $750; Justice Schaefer, $500.

Since they regarded the money as personal gifts, six of the eight paid no income taxes on the amounts. Those who paid: O'Donne.l and McGowan. Lawyer Mc-Gowan said this week that his payment was not to be regarded "as a legal opinion" that the others owed a tax on their gifts. The point is a ticklish one, since Stevenson first explained the payments as additional compensation for services to the state. If the money is for services, it is taxable; if it is a gift, it is not taxable.

For the talk about other funds, Adlai Stevenson had only general and passing notice. Said he: "There have been assertions that there were other political contributions made during my administration. Of course there were. Nineteen fifty, 1951 and 1952 were all election years in Illinois. Campaign contributions were received in all these years--and they were spent for political purposes." But he said nothing about how much those funds amounted to or what they were spent for, and gave no indication that he intends to do so.

In themselves, Stevenson's gifts to state employees of money collected for political purposes did not constitute a scandal. They were, however, considerably more unconventional than the Nixon fund, about which Stevenson's personally selected national chairman had raised such an outcry. Probably Chairman Mitchell did not know about the Stevenson fund. Stevenson, who did know about it, justly and prudently refused to get into the pack yapping at Nixon; Stevenson's only comment on Nixon was: Let's wait for all the facts. This week Mitchell, who may have committed the political blooper of the year by dashing into the Nixon case, was not available for comment on the Stevenson fund.

* Mulroy resigned a year ago, shortly after he was named as one of several Illinois Democratic politicians who bought io^-a-share stock in the Chicago Downs Association and made a profit of 1,650% in two years. Mulroy's stock transactions occurred after the 1949 Illinois general assembly passed and Governor Stevenson signed a bill to permit Chicago Downs to sponsor harness racing.

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