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05/27/1999
The Rosenbergs / Bernard Schwartz
This week I will stretch, slightly, the definition of Hott Spotts as
I take advantage of the Cox Committee Report''s charges of Chinese
spying against the U.S. The most damning public accusations are
against Loral and Hughes Electronics, 2 leading U.S. defense
contractors, for allegedly helping the Chinese with their failed
rocket program. The Cox Committee says that Loral and Hughes
broke many laws dealing with the export of super sensitive
technology. Both Loral and Hughes deny these charges. There
is no doubt that when congressional hearings are held on this
topic we all will be amazed at the lengths these companies went
to to aid a potential enemy of the U.S. I also submit to you that
IF Loral Chairman, Bernard Schwartz, is found to have
knowledge of illegal activities, he should be sentenced to life in
prison. I first wrote about Loral''s involvement back on 5/25/98
and again on 1/2/99 (pimcofunds.com). Schwartz, the
Democratic Party''s leading donor in 1996, deserves to be placed
under the utmost scrutiny. Following is a brief summary of
another case which galvanized the nation back in the early
1950''s. You will hear much more about it in the media, going
forward, as the Chinese spy case unwinds and comparisons to
history are made.
1950 was a particularly nervous time for America. The Cold
War was heating up and tales of espionage, both true and untrue,
were flying. Herewith is a brief chronology of events that year.
Jan. 21st Alger Hiss convicted of 2 counts of perjury.
Jan. 31st Truman announces that he had ordered work to start on
the hydrogen bomb.
Feb. 2nd Klaus Fuchs confesses in London to having spied for
The Soviet Union while he worked on Anglo-
American atomic research (1943-47).
Feb. 9th Senator Joseph McCarthy gave his famous speech to a
Women''s Club in Wheeling, West Virginia, saying that
205 Communists were employed in the State Dept. (a
totally false charge...McCarthy made the number up).
June 28th North Korea invades South Korea
June 30th Truman send American troops to fight in defense of
South Korea.
Aug. 17th Julius and Ethel Rosenberg, along with 7 others, are
charged with atomic espionage.
Klaus Fuchs, one of the primary physicists at Los Alamos in
1945, had been funneling information on the bomb to Soviet
agents. Upon his arrest in 1950, Fuchs revealed that he had not
worked alone and that he was part of a spy ring involving 9
others, including Julius and Ethel Rosenberg. The Rosenberg''s
were eventually executed.
After decades of controversy there is no doubt today as to the
guilt of Julius Rosenberg and the complicity of Ethel in a Soviet
conspiracy to steal American atomic secrets. Decoded wartime
cables from the Soviet consulate in N.Y. to the KGB in Moscow,
made public in July 1995, give us a mental picture of Julius in a
New York apartment photographing documents and diagrams
brought to him by a small ring - mostly young fellow
Communists he met at City College of N.Y. None of these
intercepts was in evidence at the trial in March 1951 and thus led
to the perception among many that the government had trumped
up charges against them. Protests were widespread.
The U.S. did not want the Soviets to know it had cracked enough
of an "umbreakable" code to have proof of a vast espionage
effort. Up to 220 spies were involved as well as leaders of the
U.S. Communist Party. The Rosenberg''s were convicted on the
evidence of Ethel''s brother, David Greenglass, and his wife,
Ruth. David was a young soldier working in a machine shop at
Los Alamos, N.M., where he picked up information on the
design of the plutonium device later dropped on Nagasaki. He
gave some crude sketches to Julius and passed on more through
Harry Gold, a zany Philadelphia chemist turned Soviet courier.
Gold turned up at the Greenglass apartment in Albuquerque,
identifying himself with a Jell-O box whose irregularly cut edge
matched a portion Julius had given David.
Conviction was not in doubt, but the sentence was. Judge Irving
Kaufman, Jewish like the accused and the prosecutors, was
portrayed in the press as having gone to a synagogue for divine
guidance. Roy Cohn, later chief counsel to Joe McCarthy, was
on the prosecution team. Cohn said that "it was not God that
concerned him. He asked me how a double death sentence
would play in the New York Times."
The sentences provoked outcry around the world. Executing
Ethel, against whom little evidence was produced, and orphaning
the couple''s young sons, struck many as a cruel and panicky
result of the anti-Communist hysteria. Supreme Court Justice
William Douglas ordered a stay of execution on the grounds that
Judge Kaufman did not have a jury vote on the death sentence, as
required by the Atomic Energy Act of 1946. But the remaining
Justices came back from vacation to overrule Douglas''s order,
6-3. On June 19th, 1953, the Rosenberg''s were taken to the chair,
just hours after the decision. [They were executed in Sing Sing
Prison, N.Y.]
President Eisenhower had denied the Rosenberg''s clemency and
was extremely anxious to execute them, pressing the Court back
from vacation to confront Douglas who Ike knew would order a
stay. Eisenhower said of the Rosenberg''s that they "may have
condemned to death tens of millions of innocent people."
The President signed an Executive Order in 1953 which
broadened the basis for firing government workers by replacing
Truman''s criterion of "disloyalty" with the new category of
"security risk." Under the new edict federal workers lost their
jobs because of dubious associations or personal habits that
might make them careless or vulnerable to blackmail.
The Rosenberg case also helped give rise to Joseph McCarthy.
Saying that when you put all of the spy cases together you had a
systematic conspiracy to destroy the American Republic from
within, McCarthy ran roughshod over the Constitution until he
was finally put under censure by the Senate in 1954, which held
that his actions were "contrary to Senate traditions."
Next Hott Spotts, June 3rd.
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