Pass the Ammunition

Until last week, the two candidates for governor of New York, Irving M. Ives and W. Averell Harriman, were waging dull and gentlemanly campaigns, avoiding sensationalism. Last week New York's cold campaign suddenly got hot. After a two-hour session with the master strategist, Thomas E. Dewey. Senator Ives dramatically broke off his upstate speaking tour and roared down to Manhattan for a television and radio broadcast advertised as the first of a series of "shocking" blockbusters revealing some awful truths about Harriman.

Blockbuster No. 1. For his text Ives went all the way back to 1926, when Harriman was board chairman of a now-defunct steamship line. The company had obtained two Manhattan piers from Tammany Hall, Ives charged, by paying $250,000 to a corrupt Brooklyn judge. Harriman, testifying before a grand jury in 1930, had denied any knowledge of the transaction. "I can tell you," thundered Ives, "that you can't trust big business . . . particularly the business of the state, to a man who says he didn't know what happened to a quarter of a million dollars of his own company's money . . ."

Harriman reiterated his ignorance of the affair, denounced Ives's speech as a "baseless attack on my personal honor and integrity."

Blockbuster No. 2. Three nights later, Tom Dewey dropped a second and more explosive bombshell. In 1925, he charged, Harriman had made a $2,000,000 loan to a company that operated a zinc mine in Polish Silesia. When the loan turned sour, Harriman and some banking associates formed a new company, issuing $15 million in bonds to operate the mine. "Before long, the company started losing money. Then came the war, and the mines were finally nationalized, and Harriman's great promotion, the Silesian American Corp., went into the hands of the bankruptcy court." The result, added Dewey, was a loss of $5,000,000 to the stockholders, a tidy profit to Harriman and associates. Dewey quoted from an SEC report which said that Harriman and his colleagues, "with substantially no investment, received stock and large profits . . . through funds obtained from deliberately misinformed investors." A lawsuit to recover the stockholders' money is still pending in a federal court.

Harriman, now thoroughly needled, cried distortion. All but "about $2,500,000" of the original $15 million had been repaid to the investors, he said, and the balance would have been fully paid up if it had not been for World War II.

Blockbuster No. 3. The following day Ives dropped the third bombshell. In 1947 Harriman had fired "nearly 30" employees of a dairy he owned, Ives charged, because they had joined a union. Democratic headquarters issued another heated denial. Harriman had dropped the workers because he was discontinuing an unprofitable business. Added Fred A. Conrad, president of the union local: "There was nothing in the case that would be interpreted as an antilabor attitude."

Meanwhile, Eisenhower visited New York, gave the Ives campaign a belated shot in the arm. Opinion polls last week had Harriman leading, but the sharp drop in New York City registration figures (down 17% in Manhattan from the 1950 level) looked like very good news for Ives.

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