$50,000 Arkansas Gift to Truman in ’48

Westbrook Pegler

Shreveport Times/January 6, 1955

LITTLE ROCK, Ark.. Jan. 5-I told you that Charles T. Emery, senior special agent in charge of the Little Rock Bureau of Internal Revenue, was given two hours to decide whether he would accept a transfer to Chicago or apply for retirement when he was engaged in an investigation of the income and the tax returns of the Democratic governor.

The governor was Sid McMath, a member of the Truman party machine in the Southern tier. McMath is now a strong factor in the incoming administration of Orval Faubus, an alumnus of the Arkansas Communist College called Commonwealth, which was closed by court order in 1941.

Faubus was also president of the Commonwealth student council and in 1935 was honored with selection to the position of official student orator on May Day, a Communist political gala.

In June of the same year, the student paper, the Fortnightly, stated that Orval Faubus was one of three persons, two of them students, the third a teacher, who went to the ATI-Southern Conference of Civil and Trade Union Rights at Chattanooga, as “delegates from the United Front on the Campus” of Commonwealth. The Chattanooga conference was held on May 26.

Faubus has intimated that he spent only a “few days” at Commonwealth and that he was not an influential or prominent member of the student body. He also has challenged anyone to say publicly that he is “subversive.”

Faubus campaigned for McMath, who served two terms as governor in the Truman reign, which remains almost a political closed shop in the Ozarks. In turn, McMath campaigned for Faubus and they are now close and efficient allies.

The Arkansas Gazette, the most powerful individual paper in the area, supports them.

The ultimatum to Emery during the McMath investigation removed from the situation a treasury man who had pursued the facts with determination and skill. That skill had been demonstrated in a number of conspicuous fraud cases and, in general, over a period of 26 years in the internal revenue.

Had he accepted transfer to Chicago, Emery would have been removed from the McMath case, anyway. The dilemma was personal and almost tragic in respect to his family, for he had become a genuine member of the community in Little Rock and Arkansas. So Emery put in for retirement and went into private practice as a tax consultant.

Some time before the crisis, in the McMath case, Emery came upon information indicating that five businessmen in Fort Smith had put up $50,000 in currency in small denominations which had been delivered to a person in the Muehlebach Hotel in Kansas City during Harry Truman’s campaign against Tom Dewey in 1948.

The Fort Smith Chamber of Commerce was interested in a move to reactivate Camp Chaffee, an improvised army post of World War II, which had been abandoned upon demobilization.

The country was going back into the war business as a means of absorbing unemployed men into the armed forces and war industries.

Camp Chaffee had provided a big steady payroll which was profitable to much of Fort Smith’s industry and commerce. An emissary was sent to Washington to plead for “reactivation.”

A prominent Fort Smith banker delivered, if he did not personally provide, a fund to pay the expenses of the Washington journey of the agent, who was an appointed official of a department of the national government serving in Arkansas.

Mr. Emery claims to have positive knowledge that the banker deducted from his taxable income as a bad debt the money which he advanced to this Democratic federal appointee for the trip to Washington.

When the mission failed, an unofficial committee of Fort Smith businessmen started to raise money to bring about the reopening of Chaffee. One of these individuals got a phone call from a prominent Democratic politician in Kansas City to the effect that $50,000 would swing the job, but that the money must be provided by not more than five individuals and not by public subscription.

The money was delivered to the recipient in the Muehlebach while Truman and his campaign party were in the hotel.

There is no suggestion that Truman had anything to do with the transaction nor even that he had knowledge of it.

Indeed, it is possible that the money did not actually go into the Democratic National campaign fund nor any other Democratic campaign fund.

It might have been knocked down by the recipient or divided among a number of individuals.

Mr. Emery first heard of the transaction from a Republican national committeeman who told him that he had reported the information to a Democratic senator whom he named.

At the time he received the information Emery was having troubles of his own in regard to Mc-Math’s taxes and returns so he put it on his list of unfinished business.

Emery also noted that there was no crystallized issue of tax fraud or delinquency in the case of the $50,000.

Therefore it was not within his narrow official purview, although fraud might have been alleged under some other law.

Mr. Emery would be willing to testify to the facts and the hearsay as he knows them before a federal grand jury or a committee of either house of Congress.


(Source: Newspapers.com, https://www.newspapers.com/image/211284811/?terms=westbrook%2BPegler)


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