Harry Dexter White

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Harry Dexter White (October 1892 – August 16, 1948) was an American economist and senior U.S. Treasury department official. He was a primary mover behind the Bretton Woods agreement and the formation of the International Monetary Fund and the World Bank. A number of sources claim that he engaged in espionage activity for the Soviet Union.

Contents 1 Early life 2 Political Activities 3 Treasury Department 4 Accusations of Espionage 5 Venona Project Revelations 6 Notes 7 References 8 External links

[edit] Early life

The son of Lithuanian Jewish immigrants, White was born in Boston, Massachusetts. As a young man, he served in the U.S. Army, fighting in France during World War I. He did not begin his university studies until age 30, first at Columbia University, then at Stanford, where he earned a first degree in economics. After completing a Ph.D. in economics at Harvard University at 38 years of age, White taught four years at Lawrence University in Appleton, Wisconsin. Harvard Univ. Press published his Ph.D. thesis in 1933, as The French International Accounts, 1880–1913.

[edit] Political Activities

Outwardly, White was a Keynesian New Deal Democrat, though he had a affinity for those on the extreme left. As Senator William Jenner wrote after 1953 hearings on subversion in government departments, White hired Communist Party members and promoted them within the government. As head of the independently-funded Office of Monetary Research, White was able to hire staff without the normal civil service regulations or background enquiries. Some of those he hired had previously experienced security-clearance trouble in other government positions.^[1]

As a dedicated Rooseveltian internationalist, his energies were directed at continuing the Grand Alliance and maintaining peace through a liberal trade regime. He believed that powerful, multilateral institutions could avoid the mistakes of Versailles and prevent another worldwide depression. His political views were close to that of Henry A. Wallace and he was considered a progressive.

[edit] Treasury Department

In 1934, Jacob Viner, a professor at the University of Chicago working at the Treasury Department, offered White a position at the Treasury, which he accepted. Within a few years, White met with John Maynard Keynes and other leading international economists.

After the December 1941 attack on Pearl Harbor, White was appointed assistant to Henry Morgenthau, the Secretary of the Treasury, to act as liaison between the Treasury and the State Department on all matters bearing on foreign relations. He was also made responsible for the "management and operation of the Exchange Stabilization Fund without a change in its procedures." White eventually came to be in charge of international matters for the Treasury, with access to extensive confidential information about the economic situation of the USA and its wartime allies.

According to the son of Henry Morgenthau, Jr. White was the principal architect behind the Morgenthau Plan.^[2] The Morgenthau postwar plan, as authored by White, was to take all industry out of Germany, eliminate its armed forces, and convert the country into an agricultural community, in the process eliminating most of Germany's economy and its ability to defend itself if attacked. A version of the plan, limited to turning Germany into "a country primarily agricultural and pastoral in its character", was signed by President Franklin D. Roosevelt and the British Prime Minister Winston Churchill at the Second Quebec Conference in September 1944. However, someone in White's department with access to details of the plan leaked it to the press, and White himself provided an advance copy to Soviet intelligence.^[3] Public protests forced Roosevelt to publicly backtrack. The Nazis and Josef Goebbels were ecstatic at the revelations, using the Morganthau Plan as a propaganda coup to encourage their troops and citizens to fight on and to nullify emerging German criticism of the war and arguments for a separate peace with Western governments. White's actions also benefited the Soviet Union, virtually ensuring that the Nazi government or successors could not negotiate a separate peace with the West.

White was the senior American official at the 1944 Bretton Woods conference, which he and Keynes dominated. The Soviet Union was among the nations represented at that conference. After the war, White was closely involved with setting up what were called the Bretton Woods institutions - the International Monetary Fund (IMF) and the World Bank. These institutions were intended to prevent some of the economic problems that occurred after World War I, and help ensure that capitalism became the dominant post-war economic system. As late as November 1945, White continued to argue for improved relations with the Soviet Union.^[4] White later became a director and U.S. representative of the IMF.

On June 19, 1947, White abruptly resigned from the International Monetary Fund, vacating his office the same day.

[edit] Accusations of Espionage

On July 31, 1948, Elizabeth Bentley told the House Committee on Un-American Activities that White had been involved in espionage activities on behalf of Soviet Union during World War II,^[5] and had passed sensitive Treasury documents to Soviet agents. Bentley said White's colleagues passed information to her from him. In her testimony and in later interviews, she insisted that White, acting on instructions from the Soviet Union, pressured the Treasury Department to give the Soviet Union plates for printing German occupation currency. Bentley's currency plate story is suspicious on several levels: (1) such materials are tightly controlled, (2) the debate over to release the plates was "public" (within the context of the interested parties), and (3) while the plates were in fact turned over to the Soviets in 1944, Bentley did NOT mention them in her 1948 testimony but then did feature them in her 1953 testimony.

Whittaker Chambers, an admitted Soviet espionage agent, subsequently testified on August 3 of his association with White in the Communist underground secret apparatus up to 1938.^[6] Chambers claimed he received documents from White, and identified White's handwriting on documents retrieved by the FBI from a cutout 'mailbox' (a hollowed-out pumpkin). Chambers also stated that White was the least productive of his contacts.

On August 13, 1948, White testified before HUAC. Recovering from a series of heart attacks, he denied being a Soviet agent. Three days later, he was dead of a heart attack.

Senator William Jenner's Interlocking Subversion in Government Departments Investigation by the Senate Internal Security Subcommittee (SISS) looked extensively into the problem of unauthorized and uncontrolled powers exercised by non-elected officials, specifically White. Part of its report looked into the implementation of Roosevelt administration policy in China and was published as the Morgenthau Diary.^[7] The report stated,

"The concentration of Communist sympathizers in the Treasury Department, and particularly the Division of Monetary Research, is now a matter of record. White was the first director of that division; those who succeeded him in the directorship were Frank Coe and Harold Glasser. Also attached to the Division of Monetary Research were William Ludwig Ullman, Irving Kaplan, and Victor Perlo. White, Coe, Glasser, Kaplan, and Perlo were all identified as participants in the Communist conspiracy…"

The committee also heard testimony by Henry Morganthau’s speechwriter, Jonathan Mitchell, that White had tried to persuade him that the Soviets had developed a system that would supplant capitalism and Christianity.

In 1953, Senator Joseph McCarthy and Attorney General Herbert Brownell, Jr. alleged that Truman had known White was a Soviet spy when he appointed him to the IMF.^[8] However, this has now been refuted by declassified documents through the Freedom of Information Act which attest President Truman and the White House had not known of the existence of the Venona project.^[9]

[edit] Venona Project Revelations

Two years after his death, in a memorandum dated 15 October 1950, White was positively identified by the FBI, through evidence gathered by the Venona project, as a Soviet source, code named "Jurist".^[10] Years later, the Justice Department publicly disclosed the existence of the Venona project which deciphered Soviet cable traffic naming White as 'Jurist', a Soviet intelligence source. As reported in the FBI Memorandum on White:

You have previously been advised of information obtained from [Venona] regarding Jurist, who was active during 1944. According to the previous information received from [Venona] regarding Jurist, during April, 1944, he had reported on conversations between the then Secretary of State Hull and Vice President Wallace. He also reported on Wallace's proposed trip to China. On August 5, 1944, he reported to the Soviets that he was confident of President Roosevelt's victory in the coming elections unless there was a huge military failure. He also reported that Truman's nomination as Vice President was calculated to secure the vote of the conservative wing of the Democratic Party. It was also reported that Jurist was willing for any self-sacrifice in behalf of the MGB but was afraid that his activities, if exposed, might lead to a political scandal and have an effect on the elections. It was also mentioned that he would be returning to Washington, D. C., on August 17, 1944. The new information from [Venona] indicates that Jurist and Morgenthau were to make a trip to London and Normandy and leaving the United States on August 5, 1944.

White also acted on behalf of the Soviet Union in determining policy for the printing of occupation currency for Germany. White pushed strongly to give the USSR the currency plates to allow them to print German occupation currency, an action that cost the United States government hundreds of millions of dollars when the Soviets flooded the country with occupation banknotes that were used to purchase American goods. A memorandum found in Soviet archives from Gaik Ovakimian, head of the NKVD's American desk, notes that "following our instructions," White "attained the positive decision of the Treasury Department to provide the Soviet side with the plates for engraving German occupation marks." This internal MGB memorandum confirmed the claims of Elizabeth Bentley.^[11]

Other Venona decrypts revealed further damaging evidence against White, including White's suggestions on how to meet and pass information to his Soviet handler. Venona Document #71 contains decryptions of White's discussions on being paid for his work for the Soviet Union.^[12][13]

In 1997, the bipartisan Moynihan Commission on Government Secrecy, chaired by Democratic Senator Daniel Patrick Moynihan, stated in its findings,

The complicity of Alger Hiss of the State Department seems settled. As does that of Harry Dexter White of the Treasury Department.^[14]

Further evidence of White’s complicity as a Soviet agent was gleaned from Soviet archives and KGB operative Alexander Vassilev. In a book by Allen Weinstein and Alexander Vassiliev, The Haunted Wood: Soviet Espionage in America—the Stalin Era, Vassiliev, a former Soviet journalist and KGB operative, reviewed Soviet archives dealing with White's actions on behalf of the Soviet Union. White assisted Harold Glasser, a Treasury executive and NKVD spy, “in obtaining posts and promotions at Treasury while aware of his Communist ties.” Because of White’s backing, Glasser survived an FBI background check. In December 1941 the Secret Service forwarded a report to Harry White indicating that it had evidence Glasser was involved in Communist activities. White never acted on the report. Glasser continued to serve in the Treasury Department, and soon began recruiting other agents and preparing briefing reports on Treasury personnel and other potential espionage agents for the NKVD. After America became involved in World War II, Glasser received appointments to several higher-level positions in the government on White's approval.^[15]

According to Soviet archives, White's other MGB code names were “Lawyer,” “Richard,” and “Reed.” In order to protect their source, Soviet intelligence repeatedly changed White's code name.

White's family still protests his innocence.^[16]

[edit] Notes

[edit] References

• Boughton, James M. (2001). The Case Against Harry Dexter White: Still Not Proven (PDF). Retrieved on 2006-10-03.
• Craig, R. Bruce (2004). Treasonable Doubt: The Harry Dexter White Spy Case. University Press of Kansas, 496. ISBN 0-7006-1311-0.
• Haynes, John Earl, Klehr, Harvey (2000). Venona: Decoding Soviet Espionage in America. Yale University Press. ISBN 0-300-08462-5.
• Haynes, John Earl, Klehr, Harvey (2003). In Denial: Historians, Communism, & Espionage. Encounter Books. ISBN 1-893554-72-4.
• Schecter, Jerrold and Schecter, Leona (2002). Sacred Secrets: How Soviet Intelligence Operations Changed American History. Potomac Books. ISBN 1-57488-327-5.
• Vassiliev, Alexander (2005). Alexander Vassiliev’s Notes on Anatoly Gorsky’s December 1948 Memo on Compromised American Sources and Networks. Retrieved on 2006-10-03.
• Weinstein, Allen and Vassiliev, Alexander (1999). The Haunted Wood: Soviet Espionage in America--The Stalin Era. Modern Library. ISBN 0-375-75536-5.

[edit] External links

• IMF: Biography of White.
• FBI Venona file pg.17
• FBI Silvermaster file, p.27
• Time magazine:
  • Nov. 23, 1953, "One Man's Greed."
  • Nov. 30, 1953, "The White Case Record."
• Wikisource:FBI Memorandum identifying Harry Dexter White as agent Jurist