Whitney family

The Whitney family is a New England line that settled at Watertown, Massachusetts and became a New York fortune through William Collins Whitney, a lawyer and financier who served as Grover Cleveland's Secretary of the Navy and who married Flora Payne, sister of the Standard Oil treasurer Oliver Hazard Payne. Antony C. Sutton places the Whitney family, dated to 1635 at Watertown, among the old-line families of Skull and Bones in his chart, which he titles "Hypothesis Number One," and he places the Payne family under Standard Oil among the new-wealth families.¹ The Yale University Obituary Record entry for Payne Whitney traces the family to John Whitney, who came from England in 1635 and settled at Watertown.²

William Collins Whitney

William Collins Whitney was born in Conway, Massachusetts on July 5, 1841, the son of James Scollay Whitney, a Democratic leader in Massachusetts and superintendent of the United States Armory at Springfield, Massachusetts. He entered Yale in the class of 1863, took a course at Harvard Law School, read law in the office of Abraham R. Lawrence and began practice in New York City in 1865 with his classmate Henry Farnam Dimock, who married his sister. In 1871 he helped organize the Young Men's Democratic Club, which took part in the movement that overthrew the Tweed Ring. He was appointed Counsel to the Corporation of the City of New York on August 9, 1875, was twice reappointed and resigned on November 6, 1882. At the 1884 Democratic convention in Chicago he exerted what the Yale record calls a powerful influence for Cleveland.³

Secretary of the Navy

Whitney practiced law until March 1885, when he became Secretary of the Navy, and he held the post until the close of Cleveland's administration in 1889. Yale University gave him an LL.D. in 1888.³ His first annual report, dated December 1885, argues that the department's bureau system left no one with a duty to deliberate: the Secretary was a civilian with a staff of one stenographer, one clerk and three messengers, and the department's decisions, among them the rebuilding of the USS Omaha for $572,000, had no identifiable author. He recommended a board of naval officers and experts to advise the Secretary, as the French and German navies had, and an Assistant Secretary of the Navy.⁴

The report for 1887, dated December 6, 1887, states that the country lacked factories for steel gun forgings, for armor and for secondary batteries, and that all three were then being built under contracts with the department. It says that "it was a fatal mistake for this country to be dependent upon any other nation for its implements of war."⁵ The department had advertised in the summer of 1886 for armor and gun steel of domestic manufacture, allowed about seven months for bids and opened them on March 22, 1887. The result was a contract with the Bethlehem Iron Company, under which a plant for armor and gun steel was being erected at Bethlehem, Pennsylvania.⁵ The report for 1888 gives June 1, 1887 as the date of the contracts and describes them as the first important step toward a navy modern in character.⁶

The Yale record credits his tenure with improvements in steel manufacture that made it possible for the first time to equip American war vessels fully with an armament produced at home.³

The street railways and the Whitney Group

After 1889 Whitney turned to finance. The Yale record says he developed the Metropolitan Street Railway from a single company through reorganization and consolidation, that it bought out its only rival and that it was in turn merged into the Interurban Street Railway Company. It adds that for several years he held no visible office or connection with the system, yet controlled its operations and secured the results he sought through others, and that his judgment in selecting men to carry out his plans was unerring. He retired from active business in 1902. He was a trustee of the Consolidated Gas Company and a director of the Metropolitan Opera and Real Estate Company, the Metropolitan Steamship Company, the New York Loan and Investment Company, the Manufacturing Investment Company, the Mergenthaler Linotype Company, the Guggenheim Exploration Company and the Cuba Company, and he held shares in several local banks. He died at his New York home on February 2, 1904.³ Sutton wrote that a cluster of capitalists known as "the Whitney Group" were heavily criticized in several books, and that the group's New York street railway franchises generated enormous profits.⁷

The railway system went into receivership three and a half years after his death. The New-York Tribune of September 26, 1907 reported that Adrian H. Joline and Douglas Robinson had been named receivers of the New York City Railway Company, the lessee of the Metropolitan Street Railway, which had guaranteed a 7 percent dividend to Metropolitan stockholders. The paper called the receivership a "friendly proceeding" and wrote that a receivership might otherwise have been precipitated by interests "distinctly unfriendly to the Ryan-Belmont control." It adds that Judge Emile Henry Lacombe, who appointed the receivers, had been an assistant corporation counsel while Whitney was Corporation Counsel, and had been named a federal judge during Whitney's term in Cleveland's cabinet.⁸

On October 13, 1869, Whitney married Flora Payne, daughter of Henry B. Payne, a United States senator from Ohio, and sister of his classmate Oliver Hazard Payne. They had two sons, who graduated from Yale in 1894 and 1898, and three daughters.³

Oliver Hazard Payne and the Standard Oil treasurership

Oliver Hazard Payne was born in Cleveland on July 21, 1839, the son of Henry B. Payne, who served in the Ohio Senate, in the United States Congress and as a United States senator from 1885 to 1891. He left the Yale class of 1863 in October 1861 to accept a commission in the 124th Ohio Infantry, rose to colonel and was brevetted brigadier general on March 13, 1865. The Yale Corporation voted him a B.A. in 1878, and he was enrolled in the class of 1863 from that date. After the war he entered the oil refining business in Cleveland with James B. Clark and John Huntington. The business was absorbed by the Standard Oil Company, and Payne served as its treasurer until 1884, when he moved to New York City and joined its board.⁹

The decree in the government's suit, as set out in the Supreme Court's 1911 opinion, names "Oliver H. Payne" among the seven individual defendants who joined the combination, together with John D. Rockefeller, William Rockefeller, Henry H. Rogers, Henry M. Flagler, John D. Archbold and Charles M. Pratt.¹⁰ The opinion places the trust agreement of 1882, which vested the stock of forty corporations in nine trustees, in the second of three periods of the alleged combination, and it lists "O. H. Payne" among the individual holders of stock exchanged into the Standard Oil Company of New Jersey in 1899.¹¹

His directorships included the American Tobacco Company, the Virginia and Southeastern Railway Company, the Coal Creek Mining and Manufacturing Company and the Tennessee Coal and Iron Company. His largest gifts went to the Cornell Medical School, and in 1887 he endowed the Loomis Laboratory. Payne's will left one million dollars each to Yale, the New York Public Library and Lakeside Hospital in Cleveland. He spent each summer from 1898 to 1914 in Europe on his steam yacht Aphrodite, and he died in New York City on June 27, 1917. The Yale record names his nephews as Harry Payne Whitney, Payne Whitney and Henry Payne Bingham.⁹

Sutton wrote that "The Paynes are not in The Order," and that adding the Payne piece of the Standard Oil fortune made Whitney's fortune "that much larger."¹²

Skull and Bones membership

Sutton's index of the Order by class year lists eight Whitneys: Emerson Cogswell Whitney (1851), Edward Payson Whitney (1854), James Lyman Whitney (1855), William Collins Whitney (1863), Edward Baldwin Whitney (1878), Joseph Ernest Whitney (1882), Harry Payne Whitney (1894) and Payne Whitney (1898).¹³ Sutton's text names W.C. Whitney and his two sons as "the core of Whitney influence" in the society, and he ties that influence to the Harriman family and to intermarriage with the Paynes and the Vanderbilts.¹⁴

Sutton's chart table prints the two sons' years in reverse, giving Payne Whitney as 1894 and Harry Payne Whitney as 1898, while his text and index give Harry Payne Whitney as 1894 and Payne Whitney as 1898. The Yale records give the same graduating years as Sutton's text and index.¹⁵³ The Yale Obituary Record for Payne Whitney lists "Skull and Bones" among his undergraduate activities.²

Payne Whitney

Payne Whitney was born in New York City on March 20, 1876. He rowed on the Yale crews and captained the Senior crew, took an LL.B. at Harvard Law School in 1901 and was a director and member of the executive board of the Great Northern Paper Company from 1903 to 1927. The Yale record also lists him as director and vice-president of the Northern Finance Corporation from 1911 and of the Whitney Realty Company from 1910, a trustee of the United States Trust Company from 1905 and of the Metropolitan Museum of Art from 1922, a director of the First National Bank of New York from 1924, a former director of the Northern Pacific Railroad and chairman of the executive committee of the Vanadium Corporation of America from 1923. In 1923 he gave $2,000,000 to the New York Public Library, of which he had been a trustee since 1915.²

On February 6, 1902, in Washington, he married Helen Hay, daughter of John Hay, then Secretary of State. Their children were Joan, who married Charles S. Payson of the Yale class of 1921, and John Hay Whitney, of the class of 1926, then a student at the University of Oxford. Payne Whitney died in Manhasset, New York, on May 25, 1927. The Yale record lists his surviving siblings as Harry Payne Whitney and a sister, the wife of Leonard Knight Elmhirst of Yorkshire, England.²

In June 1916 Payne Whitney formed the Yale Aviation Corps. A Yale Obituary Record entry for a member of the corps says it was "formed by Payne Whitney, '98, in June, 1916," and that Aerial Coast Patrol Unit No. 1 was organized by F. Trubee Davison of the class of 1918, a unit afterward known as the Huntington Unit.¹⁶

The New York appraisal of his estate was reported in November 1928. The Washington Daily News headed its account "Payne Whitney Left Biggest Estate Ever Appraised in U.S.," gave the appraised net value as more than $175,000,000 and the expected death tax as about $20,000,000, of which about $15,600,000 would go to New York State. The larger part of the estate was a half interest in the Northern Finance Corporation, a holding company for securities, which the paper said grew from a fund set aside by his uncle, Colonel Oliver H. Payne, who established it to be relieved of the care of large blocks of Standard Oil and subsidiary stocks and tobacco shares.¹⁷

Harry Payne Whitney, Gertrude Vanderbilt Whitney and the Whitney Museum

Harry Payne Whitney, Yale 1894, was born in New York on April 29, 1872. He married the sculptor Gertrude Vanderbilt Whitney in 1896, according to Sutton, who wrote that the Whitney-Payne fortune then "joined some Vanderbilt money," which he says was channeled into the Guaranty Trust Company and the J. P. Morgan and Guggenheim interests.¹⁸ He kept a racing stable whose horses won the Preakness and the Kentucky Derby and were the leading money winners of 1924, and he was a member of the American polo team that brought the international cup back from England in 1909. He died of pneumonia at his Fifth Avenue home on October 26, 1930, at 58. The United Press reported that he was the son of the Secretary of the Navy in Cleveland's cabinet and that he had inherited from his father a fortune estimated at $200,000,000.¹⁹

Gertrude Vanderbilt Whitney became the leading patron of American art from 1907 until her death in 1942, established the Whitney Studio Club in Greenwich Village in 1914, and founded the Whitney Museum of American Art in 1930, after the Metropolitan Museum of Art declined the gift of her collection of more than five hundred works. The museum opened in 1931 on West Eighth Street.²⁰

Their son Cornelius Vanderbilt Whitney, Yale 1922, is listed in the 1927 Yale record as a nephew of Payne Whitney.² Sutton writes that Cornelius Vanderbilt Whitney married Marie Norton, and that after their divorce she married W. Averell Harriman.¹⁸ The Library of Congress finding aid for the Harriman papers lists the marriage in 1930 to Marie Norton Whitney, who died in 1970.²¹

Cornelius Vanderbilt Whitney in the Truman administration

The Harry S. Truman Library photograph record for a meeting of the National Security Council on August 19, 1948 names Cornelius Vanderbilt Whitney, Assistant Secretary of the Air Force, among those at the table: he sits with Secretary of the Army Kenneth Royall, Executive Secretary Sidney Souers, National Security Resources Board Chairman Arthur M. Hill, Director of Central Intelligence Roscoe Hillenkoetter, Secretary of Defense James Forrestal, Secretary of State George C. Marshall, President Truman and Under Secretary of the Navy W. John Kenney.²² The State Department's volume of Foreign Relations documents on intelligence for 1945 to 1950 lists "Whitney, C. V., Assistant Secretary of the Air Force."²³ A second Truman Library record, dated March 5, 1950, captions him as Acting Secretary of Commerce at the swearing-in of the director of the Census Bureau, and the library's other photographs describe him as Under Secretary of Commerce.²⁴

Dorothy Payne Whitney and the Straight line

The 1927 Yale record for Payne Whitney lists a sister, the wife of Leonard K. Elmhirst, and that sister is Dorothy Payne Whitney.² She had married Willard Straight in 1911, and the couple founded The New Republic in 1914 with Herbert Croly.²⁵ Sutton wrote that The Nation and the New Republic on the left "were financed by Willard Straight, using Payne Whitney (The Order) funds."²⁶ An FBI summary of a 1969 interview with the magazine's publisher, as cited on the Dorothy Payne Whitney page, records that her family's fund had founded the magazine and had been used for its operation until 1954.²⁷

The William C. Whitney Foundation appears in the FBI file on Michael Straight. Milton C. Rose, senior partner of Mudge, Rose, Guthrie and Alexander, told the FBI that the foundation was "created by Mr. Straight's parents in memory of his grandfather" and that Michael Whitney Straight had been its president "since its inception in 1937." The same summary records that Straight was questioned before a special House committee investigating tax-exempt foundations, as reported by the Washington Times-Herald on December 6, 1952, about $19,000 in grants the foundation had made to organizations "cited as subversive or communist fronts."²⁸

Michael Whitney Straight

Michael Whitney Straight, Dorothy Payne Whitney's son, was a grandson of William Collins Whitney and the president of the William C. Whitney Foundation according to the FBI summary cited above.²⁸ In June 1963 he told FBI agents that Anthony Blunt had recruited him for Soviet intelligence while he was at Cambridge, and that account was followed by Blunt's confession in 1964. The Soviet file, the British and American responses and the rest of the record are on his page.²⁹

John Hay Whitney, the embassy and the Herald Tribune

John Hay Whitney, called Jock, was the son of Payne Whitney and Helen Hay and a member of the Yale class of 1926.² The Department of State's Office of the Historian records his appointment as ambassador to the United Kingdom on February 11, 1957, with credentials presented on February 28, 1957, and his departure from the post on January 14, 1961.³⁰

The San Francisco Chronicle reported on February 25, 1967 that Whitney was the former owner, publisher and editor of the New York Herald Tribune, and that he was a one-third partner in its successor, the World Journal Tribune, and a member of that paper's three-man executive board.³¹ A statement of ownership for United Nations World dated October 1, 1947 lists "J. H. Whitney, 630 Fifth Ave., New York, N. Y." among the holders of one percent or more of the magazine's securities, beside Nelson Rockefeller and Max Ascoli.³²

On March 26, 1969 Henry A. Kissinger wrote to Peter Flanigan about Whitney's interest in the Foreign Intelligence Advisory Board. Kissinger's memorandum reads: "You should know that this has twice been raised with the President and rejected both times."³³

J. H. Whitney and Company, William H. Jackson and the CIA

The investment firm J. H. Whitney and Company had its offices at 630 Fifth Avenue in New York, the address given in the 1947 ownership statement.³² A letter of May 29, 1947, on the firm's letterhead and signed "W. H. Jackson," came from William H. Jackson and was addressed to Rear Admiral Roscoe H. Hillenkoetter, then Director of Central Intelligence. It reads: "You need only call upon me and I shall do anything within my power to be of assistance," and it offers to come to Washington "whenever you request it regardless of other appointments."³⁴

The writer of that letter is William Harding Jackson (1901 to 1971), the later Deputy Director of Central Intelligence. He was born in Nashville, Tennessee, took a B.A. at Princeton University in 1924 and an LL.B. at Harvard in 1928, worked as a lawyer and investment banker in New York, served in the Army from 1942 to 1945 and in 1944 sat on General Omar Bradley's intelligence staff.³⁵ A member of the three-man board that reported to the National Security Council on the national intelligence system in January 1949, he was named Deputy Director of Central Intelligence by Walter Bedell Smith and served from October 1950 until August 3, 1951; the CIA's announcement of his resignation that month calls him William H. Jackson "of Princeton, New Jersey" and says he resigned "due to the pressure of private business."³⁶³⁷ The Eisenhower Library's description of the President's Committee on International Information Activities identifies its chairman, William H. Jackson, as "a managing partner in the investment firm J.H. Whitney and Company, and a former Deputy Director of the Central Intelligence Agency."³⁸ From August 1951 to February 1956 he was a part-time assistant and senior consultant to the Director of Central Intelligence.³⁵

The CIA's official history of the Walter Bedell Smith years says that when Smith and Jackson could not recruit "men of great prestige with practical experience" for the Board of National Estimates, they created a group of outside advisers who met in Princeton, known as "the Princeton Consultants." The history lists among the group's original members Vannevar Bush, George Kennan, Hamilton Fish Armstrong, Alexander Standish, "a partner in J. H. Whitney & Company," Barklie McKee Henry and Burton Fahs.³⁹ Barklie McKee Henry was later a member of the Jackson Committee, appointed by President Eisenhower in January 1953 with Jackson as chairman; its other members were Robert Cutler, C. D. Jackson, Roger Kyes, Sigurd Larmon, Gordon Gray and John C. Hughes, and its report went to the President on June 30, 1953.³⁸

A second letter, of October 3, 1952, on the same letterhead and signed by William H. Jackson, was sent to the Central Intelligence Agency about a correspondent who had to interview "a great number of people." Jackson wrote that "if he wants to see Secretary Lovett, General Smith is the person to arrange it."⁴⁰ The letter refers to Robert A. Lovett and to Smith, then the Director of Central Intelligence.

Hillenkoetter, the addressee of the 1947 letter, was at the same National Security Council table as Cornelius Vanderbilt Whitney on August 19, 1948.²²

The Granary Fund and the John Hay Whitney Trust

On February 25, 1967 the San Francisco Chronicle reported from a schedule of contributions filed with the Massachusetts attorney general that the Granary Fund of Boston received $300,000 in 1964 from the John G. Thornton Trust, $150,000 from the James Carlisle Trust and $500 in miscellaneous contributions. Officials who asked not to be named called the Thornton and Carlisle trusts CIA fronts, and the paper described the Granary Fund as a fund used by the CIA to channel money to organizations at home and abroad.³¹ The same report says the Granary Fund gave a John Hay Whitney Trust for Charitable Purposes $225,000 in 1964 and $100,000 in 1965.³¹

The Chronicle reported that the Whitney trust was a charitable trust established by Whitney on December 29, 1958, during his term as ambassador to the United Kingdom. Walter N. Thayer, head of the Whitney communications corporation, made a statement on Whitney's behalf that the trust had operated since that date and that its pledges and contributions to tax-exempt organizations had all been properly reported.³¹³⁰ A Los Angeles Times report of February 26, 1967 said that Representative Wright Patman had named eight funds in 1964 in connection with the J. M. Kaplan Fund, among them the Gotham Foundation, and that the Internal Revenue Service had not yet produced records for four more, among them the Granary Fund.⁴¹ A February 21, 1967 newspaper item in the CIA reading room, "Foundations Fail to File Tax Report," also lists the Granary Fund, Boston, among foundations under question.⁴²

The 1967 reports followed the disclosure of CIA funding for the National Student Association. The Ramparts article by Sol Stern on the association and the CIA appeared in March 1967, and the New York Times reported the magazine's account on February 16, 1967.⁴³⁴⁴ The Church Committee's 1976 report on foreign and military intelligence states: "Until 1967 the Agency also maintained covert ties to American foundations in order to pass funds secretly to private groups whose work the CIA supported."⁴⁵ The report says that most of those funds "were transmitted through legitimate or 'devised' foundations, that is, fictitious entities established by the CIA," and that at least 108 of the 700 grants over $10,000 made by 164 foundations other than the Ford, Rockefeller and Carnegie foundations in 1963 to 1966 involved partial or complete CIA funding.⁴⁶