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Published online by Cambridge University Press: 24 July 2012
One of the most neglected aspects of the celebrated Teapot Dome investigation is the reaction of businessmen in general to these events. This article analyzes the views of the business community to Teapot Dome and reveals how various business interests reacted to the episode.
1 This article is an extension of research performed for a study entitled “Business Reactions to the Teapot Dome Affair, 1922 to 1925” (M.A. Thesis, University of Illinois, 1958), and prepared under the direction of Professor J. Leonard Bates.
2 Cochran, Thomas C., “A Plan for the Study of Business Thinking,” Political Science Quarterly, vol. LXII (March, 1947), p. 82.CrossRefGoogle Scholar
3 Ibid., p. 84.
4 Dahl, Robert A., “Business and Politics: A Critical Appraisal of Political Science,” American Political Science Review, vol. LIII (March, 1959), p.18.Google Scholar
5 For a sympathetic treatment of Albert B. Fall's role in Teapot Dome see Stratton, David H., “Behind Teapot Dome: Some Personal Insights,” Business History Review, vol. XXXI (Winter, 1957), pp. 385–402.CrossRefGoogle Scholar For general biographical background on Fall consult the following articles by the same author: “President Wilson's Smelling Committee,” The Colorado Quarterly, vol. V (Autumn, 1956), pp. 164–184; “New Mexican Machiavellian? The Story of Albert B. Fall,” Montana: the Magazine of Western History, vol. VII (Oct., 1957), pp. 2–14.
6 Eighty-eight days after entering office, President Harding issued an executive order bearing the date of May 31, 1921, which transferred the administration of the nation's oil reserves from the Navy to the Interior Department. This document may be conveniently seen in U.S. Senate, Leases Upon Naval Oil Reserves, Hearings before the Committee on Public Lands and Surveys Pursuant to S. Res. 282, S. Res. 294, and S. Res.434, 67th Cong., and S. Res. 147, 68th Cong. (Washington, 1924), pp. 177–178. (Hereafter the shortened form Naval Oil Hearings will be used.)
7 Oil and Gas Journal, vol. XX (Jan. 13, 1922), p. 6. This magazine is considered to be “perhaps the most valuable oil trade journal for the historian of the ‘modern’ oil industry,” by Larson, Henrietta, Guide to Business History (Cambridge, Mass., 1948), p. 608.CrossRefGoogle Scholar
8 Standard Oil Bulletin, vol. IX (Feb., 1922), p. 1.
9 The New York Times, April 8, 1922, p. 19. This announcement came the day AFTER a contract had been secretly signed with Harry F. Sinclair's Mammoth Oil Company for the exploitation of Naval Reserve Number 3, commonly referred to as Teapot Dome.
10 Petroleum Age, vol. IX (April 15, 1922), p. 90.
11 Ibid.
12 Oil News, vol. X (April 20, 1922), p. 35.
13 A recent evaluation of Denby's role may be found in Miller, Philip H., “The Role of the Secretary of the Navy, Edwin Denby, in the Teapot Dome Affair” (B.A. Thesis, University of Illinois, 1957).Google Scholar
14 U.S. v. Mammoth Oil Company, 14 F. (2d) 722.
15 Ibid.
16 Ibid., p. 721. Specifically mentioned was oil producer Leslie A. Miller's request for information sent to Senator John Kendrick about April 10.
17 For text of the bill and the arguments in detail consult Congressional Record, 67th Cong., 2d Sess., 5458 (April 13, 1922).
18 Also recorded as making inquiry were Congressman Patrick H. Kelley (Michigan), the chairman of the subcommittee of the House Committee on Naval Affairs, and Representatives Nicolas J. Sinnott (Oregon), and James V. McClintic (Oklahoma). U.S. v. Mammoth Oil Company, 14 F. (2d) 721. Senator Robert M. LaFollette of Wisconsin made inquiry as early as April 6. U.S. v. Mammoth Oil Company, 5 F. (2d) 341. Senator John William Harreld of Oklahoma stated that he began his own investigation of these rumors on April 14. Congressional Record, 67th Cong., 2d Sess., 6103 (April 29, 1922).
19 Wall Street Journal, April 14, 1922, p. 1.
20 Congressional Record, 67th Cong., 2d Sess., 11785 (Aug. 25, 1922).
21 Telegram quoted in full in ibid., 5568 (April 15, 1922). Paraphrases may be found in Oil Weekly, vol. XXV (April 22, 1922), p. 8, and in Wall Street Journal, April 27, 1922, p. 5.
22 A complete report of this meeting held on Friday afternoon of April 14 (thesame day the Wall Street Journal information appeared) may be found in National Petroleum News, vol. XIV (April 19, 1922), pp. 23–24.
23 The New York Times, April 16, 1922, p. 5. Oil columnist Charles E. Kern reported that a telegraphic protest similar to the one sent Kendrick was also sent to Fall. Oil and Gas Journal, vol. XX (April 20, 1922), p. 81.
24 For the text of Senate Resolution 277 see Congressional Record, 67th Cong., 2d Sess., 5567 (April 15, 1922), At a later date, Senator Thomas J. Walsh of Montana in reviewing the history of the Teapot Dome investigation praised the role played by Senator Kendrick and the Wall Street Journal in calling public attention to this matter. Ibid., 68th Cong., 1st Sess., 1525–1526 (Jan. 28, 1924).
25 National Petroleum News, vol. XIV (April 26, 1922), p. 23. On April 14 he had been sent a telegram by B. B. Brooks protesting against the supposed leasing. U.S. v. Mammoth Oil Company, 14 F. (2d) 721. As a businessman as well as politician, Mondell may have had a vested interest in the matter since he was “engaged in the development of coal mines and oil property in the vicinity of Newcastle and Cambria [Wyo.].” Biographical Directory of the American Congress (Washington, 1950), p. 1575.
26 Wall Street Journal, April 20, 1922, p. 9, and Oil News, vol. X (May 5, 1922), p. 55.
27 National Petroleum News, vol. XIV (April 26, 1922), p. 22.
28 Senator Walsh inserted in the Record a letter from S. E. Andrews of the Pittsburgh-Des Moines Steel Company bearing the date of Nov. 17, 1921, to the office of the Secretary of the Interior indicating such an interest. Congressional Record, 68th Cong., 1st Sess., 1533 (Jan. 28, 1924).
29 These facts were brought out at the government's trial against E. L. Doheny for cancellation of the California leases. Reported in National Petroleum News, vol. XVI (Nov. 5, 1924), pp. 29–30.
30 As examples, see Iron Age, vol. CIX (April 20, 1922), p. 1109; Ibid. (May 25, 1922), p. 1474; and Iron Trade Review, vol. LXX (April 27, 1922),p. 1201.
31 These articles bearing the dates of April 5, 7, 11, and 14 are reproduced inNaval Oil Hearings, pp. 2014–2021.
32 Ibid., pp. 2040–2042. For a more complete discussion cf the unsavory aspects of the Post's influence see Ravage, M. E., The Story of Teapot Dome (New York, 1924), pp. 127–132.Google Scholar
33 In the testimony before the committee, it appeared that these newspapers were especially placed in the hands of Senators LaFollette and Kendrick and that they may have been a factor in beginning the investigation. Naval Oil Hearings, p. 2056. Senator Kendrick, who was a member of the committee, avowed that his resolution “was not inspired by anything that I have seen in any paper” but “was prompted by messages, telegrams, asking for information that came from the people in Wyoming.” Ibid., p. 2058. One summary of the Teapot affair credits the publications of the Post as being solely responsible for the investigation. Current Opinion, vol. LXXVI (March, 1924), p. 268.
34 Petroleum Age, vol. IX (May 1, 1922), p. 25. Fischer, Louis in Oil Imperialism: The International Struggle For Petroleum (New York, 1926), p. 161Google Scholar, states that there are “suspicions” that Standard Oil Company may have “obliquely suggested the investigation to some friend of a secretary of a senator” in order to rid itself of its chief American competitor for international oil concessions.
35 Petroleum Age, vol. IX (May 1, 1922), p. 25.
36 The statement also referred to contracts being let to the Pan-American Company of Edward L. Doheny for California developments. Oil and Gas Journal, vol, XX (April 20, 1922), p. 58.
37 Reproduced in Naval Oil Hearings, pp. 3–5, and in Congressional Record, 67th Cong., 2d Sess., 6048–6049 (April 28, 1922).
38 For the provisions of this act see Congressional Record, 66th Cong., 2d Sess., 2737–2742 (Feb. 11, 1920).
39 An amendment to the naval appropriations act of June 4, 1920, specificallyprovided that the naval reserves would be exempt from the provisions of the Leasing Act and come under the genuine control of the Navy Department. The Secretary of the Navy was directed to take possession of the reserves, “to conserve, develop, use and operate the same in his discretion, directly or by contract, lease or otherwise.” Congressional Record, 66th Cong., 2d Sess., 6214–6215 (April 28, 1920). Reprinted in Naval Oil Hearings, p. 442.
40 For a detailed account of LaFollette's activities concerning the leases see LaFollette, Belle Case and LaFollette, Fola, Robert M. LaFollette (New York, 1953), vol. II, pp. 1044–1052.Google Scholar The influence of the conservationists upon LaFollette to investigate Teapot Dome are set forth by Noggle, Burl, “The Origins of the Teapot Dome Investigation,” Mississippi Valley Historical Review, vol. XLIV (Sept., 1957), pp. 237–266.CrossRefGoogle Scholar The role of conservationist Harry A. Slattery is recounted in Congresstonai Record, 72d Cong., 1st Sess., 15456–15462 (July 15, 1932).
41 LaFollette's Magazine, vol. XIV (May, 1922), p. 65.
42 Congressional Record, 67th Cong., 2d Sess., 5792 (April 21, 1922). The letter is also fully reproduced in The New York Times, April 22, 1922, p. 15. For a complete discussion of Daniels' views toward the reserves from 1913 to 1948 see Bates, J. Leonard, “Josephus Daniels and the Naval Oil Reserves,” United States Naval Institute Proceedings, vol. LXXIX (Feb., 1953), pp. 171–179.Google Scholar
43 Congressional Record, 67th Cong., 2d Sess., 6047 (April 28, 1922).
44 Ibid., 6041; Oil Weekly, vol. XXV (May 6, 1922), p. 8.
45 Congressional Record, 67th Cong., 2d Sess., 6044 (April 28, 1922).
46 Ibid. Excerpts of this and the preceding telegram appear in The New York Times, May 7, 1922, vol. VII, p. 6. Engineering and Mining Journal-Press, vol. CXIII (May 6, 1922), p. 779, prints Morgan's telegram and one from W. A. Blackmore, mayor of Casper, Wyoming.
47 Biographical Directory, p. 1270.
48 Congressional Record, 67th Cong., 2d Sess., 6044 (April 28, 1922). Harreld was perhaps the “first” to investigate the new position inaugurated by Harding's executive order changing control of the Navy reserves. In a letter of June 2, 1921, to President Harding he had “respectfully” inquired whether the executive order was in contravention of the Leasing Law of Feb., 1920. Quoted in ibid., 6103 (April 29, 1922).
49 Extracts of the letter are quoted in The New York Times, May 7, 1922 vol. VII, p. 6.
50 Petroleum Age, vol. IX (May 1, 1922), p. 62. Another commentary uponthe oil industry stated two weeks later that there was “a lot of opposition” to the leasing. Ibid. (May 15, 1922), p. 86.
51 The resolution was adopted by a vote of 58 to none. Nineteen Democrats voted in favor of the resolution and they were joined by 39 Republicans who supported an investigation of their party's administration of the naval reserves. Recorded as not voting were 38 Senators, 21 Republicans, and 17 Democrats. Congressional Record, 67th Cong., 2d Sess., 6097 (April 29, 1922).
52 Oil and Gas Journal, vol. XX (April 27, 1922), p. 7.
53 Oil News, vol. X (May 5, 1922), p. 20.
54 Oil and Gas Journal, vol. XX (April 27, 1922), p. 100.
55 Ibid., vol. XX (May 4, 1922), p. 10.
56 Ibid., p. 80.
57 Ibid. (May 25, 1922), p. 108.
58 Mining and Metallurgy, vol. III (June, 1922), pp. 7–9.
59 Oil and Gas Journal, vol. XX (May 25, 1922), p. 50.
60 For full text of the statement as read to the Senate by LaFollette see Congressional Record, 67th Cong., 2d Sess., 6893 (May 13, 1922). Reports of the proceedings at the meeting appeared in National Petroleum News, vol. XIV (May 10, 1922), pp. 29–30; Oil Weekly, vol. XXV (May 13, 1922), p. 7; The New York Times, May 14, 1922, p. 10; Petroleum Age, vol. IX (May 15, 1922), p. 18; and Oil and Gas Journal, vol. XX (May 25, 1922), p. 109.
61 Petroleum Age, vol. X (July 15, 1922), p. 25.
62 Ibid., vol. IX (May 15, 1922), p. 24.
63 National Petroleum News, vol. XIV (May 17, 1922), p. 60.
64 Ibid., p. 23.
65 Oil and Cas Journal, vol. XXI (June 15, 1922), p. 91. For a penetrating analysis of the reasons for delay see an article by Charles G. Ross, “Why Teapot Disclosures Were Delayed” in the St. Louis Post Dispatch of Feb. 26, 1924, and reprinted in LaFollette's Magazine, vol. XVI (March, 1924), p. 37. Ross attributes the delay to “indifference and inertia of the Senate in general” and to “apathy” on the part of the Republican majority.
66 National Petroleum News, vol. XIV (June 7, 1922), p. 19.
67 Oil and Gas Journal, vol. XXI (July 27, 1922), p. 40.
68 National Petroleum News, vol. XIV (July 5, 1922), p. 18.
69 Oil and Gas Journal, vol. XXI (June 22, 1922), p. 10.
70 Ibid.
71 Ibid. (Oct. 26, 1922), p. 10.
72 Standard Oil Bulletin, vol. X (Feb., 1923), p. 16.
73 Petroleum Age, vol. IX (May 15, 1922), p. 24.
74 Ibid. (June 1, 1922), p. 3. Further reference to the opposition of the independent oil men may be found in ibid., p. 28.
75 Ibid., vol. X (Oct. 15, 1922), p. 24.
76 Oil Weekly, vol. XXVI (July 22, 1922), p. 24.
77 Petroleum Age, vol. X (Oct. 15, 1922), p. 50.
78 National Petroleum News, vol. XV (Jan. 17, 1923), p. 24-B.
79 A most complete discussion of this episode may be found in ibid., vol. XIV (Aug. 9, 1922), pp. 21–22. For the Mutual Company's position see Oil Weekly, vol. XXVI (Aug. 5, 1922), p. 49.
80 The complete enumeration of charges may be found in the Congressional Record, 67th Cong., 2d Sess., 11785–11791 (Aug. 25, 1922).
81 Ibid., 11791. References to the speech and the accusations may be found in Oil and Gas Journal, vol. XXI (Aug. 31, 1922), p. 48, and in National Petroleum News, vol. XIV (Aug. 30, 1922), p. 55.
82 Wall Street Journal, April 17, 1922, p. 6.
83 Petroleum Age, vol. IX (June 1, 1922), p. 67.
84 Release is quoted in full in ibid., pp. 67–68 and in Oil News,vol. X (June 20, 1922), p. 28.
85 This was part of an address delivered by the chairman of the United States Steel Corporation at the annual luncheon of the Law Alumni of Northwestern University, Evanston, Illinois, June 17 [1922], upon receipt of the honorary degree of Doctor of Laws. See Iron Age, vol. CIX (June 22, 1922), p. 1734, and Nation's Business, vol. X (Aug., 1922), p. 54.
86 Statement made in response to a question posed by a Mr. T. L. of Newark, N.J., Magazine of Wall Street, vol. XXX (June 24, 1922), p. 288.Google Scholar
87 Literary Digest, vol. LXXIV (Sept. 30, 1922), p. 20.
88 Address by F. E. Kistler before the Third Annual Meeting on Dec. 6, 1922, in Bulletin of American Petroleum Institute, vol. III (Dec. 7, 1922), p. 5.
89 Literary Digest, vol. LXXVI (March 10, 1923), p. 14.
90 Cited in Adams, Samuel Hopkins, Incredible Era (Boston, 1939), p. 304.Google Scholar The full text of the letter is to be found in Daugherty, Harry M. and Dixon, Thomas, Inside Story of Harding Tragedy (New York, 1932), pp. 187, 190.Google Scholar
91 Oil and Gas Journal, vol. XXI (Jan. 11, 1923), p. 10.
92 National Petroleum News, vol. XV (Jan. 10, 1923), p. 25.
93 LaFollette's Magazine, vol. XIV (Nov., 1922), p. 176. At the outset some oil men felt that the “disposition of the oil in the Teapot Dome and other naval oil reserves would be especially inquired into” by the LaFollette committee. Oil News, vol. X (July 5, 1922), p. 21.Google Scholar
94 U.S. Senate, High Cost of Gasoline and Other Petroleum Products, Hearings before a Subcommittee of the Committee on Manufactures Pursuant to S. Res. 295, 67th Cong., 2d Sess. (Washington, 1923), pp. 447–449 (Jan. 10, 1923).Google Scholar (Hereafter the short form Gasoline Hearings will be used.) For a digest of his testimony indicating that Teapot Dome was “bad business” see Oil Weekly, vol. XXVIII (Jan. 13, 1923), p. 13; Oil News, vol. XI (Jan. 20, 1923), p. 26.
95 Gasoline Hearings, p. 591 (Jan. 15, 1923).
96 Ibid., p. 1175 (Feb. 7, 1923).
97 Ibid., pp. 797–798 (Jan. 24, 1923).
98 For a discussion of Walsh's relationship to the oil scandals see Bates, J. Leonard “Senator Walsh of Montana, 1918–1924: A Liberal Under Pressure” (Ph.D. Thesis, University of North Carolina, 1952), chapters 9–12.Google Scholar
99 National Petroleum News, vol. XV (Jan. 17, 1923), p. 24-B.
100 Nation's Business, vol. XI (May, 1923), p. 16.
101 Oil and Gas Journal, vol. XXI (Feb. 8, 1923), p. 36.
102 Magazine of Wall Street, vol. XXXI (March 17, 1923), p. 941.
103 Ibid., vol. XXXII (Aug. 18, 1923), p. 736.
104 National Petroleum News, vol. XV (Aug. 29, 1923), p. 21. Similar viewpoint expressed in ibid. (Oct. 10, 1923), p. 77.
105 Petroleum Age, vol. XII (Aug. 1, 1923), p. 28.
106 Oil and Gas Journal, vol. XXII (Sept. 27, 1923), p. 119.
107 Oil Weekly, vol. XXXI (Sept. 29, 1923), p. 46.
108 Oil and Gas Journal, vol. XXII (Oct. 18, 1923), p. 119.
109 For a comprehensive summary of the facts which were uncovered and their political repercussions consult Bates, J. Leonard, “The Teapot Dome Scandal and the Election of 1924,” American Historical Review, vol. LX (Jan., 1955), pp. 303–322CrossRefGoogle Scholar.
