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University Daily Kansan
Monday, Dec. 16, 1963
Investigation Uncovers Bobby Baker Story
WASHINGTON — (UPI) The young man with the ready smile, the political know-how, and the fat portfolio of business deals was a child of the Senate.
He grew up there, starting as a 14-year-old page boy. His politics were learned at the knee of some of the Senate's high and mighty.
By the time he was 35, he held a $19,600-a-year job as secretary to the Senate Democratic majority, a key position that carried influence and responsibility.
Outside the capitol, things were just as good. There were profitable business partnerships, stock deals, and real estate buys.
THIS WAS Robert G. Baker as recently as October. He was a success in business, and a success in politics. Then came his resignation from the Senate, a $300,000 lawsuit, and a Congressional investigation.
Why? What happened?
The pieces of the Baker puzzle are beginning to fall into place. For the past two months, the Senate Rules Committee has been taking testimony behind closed doors from key witnesses, trying to decide how wide the scope should be of its inquiry.
One question settled was whether the committee should look into any possible moral "improprieties" of past and present Senate employees. The answer came from Chairman B. Everett Jordan, who said the committee plans to look into "everything that pertains to the investigation, and if it involves party girls, we will bring them in."
FOLLOWING UP this announcement, the Senate investigators said they had asked the White House to order Baker's income tax file opened to them. It will be up to President Johnson to approve the request.
Baker was a Johnson aide when the President was Senate Democratic leader.
Despite being the man-in-the-middle, Baker has kept silent. His critics have not. They said he has tarnished the image of the Senate. Unlike Caesar's wife, they said, Baker did not keep himself above reproach.
Others disagree. They say Baker was merely the victim of a nontoo-effective and unrealistic conflict of interest law. They claim that Baker is no more guilty than the Senator who puts his relatives on his payroll, or who votes for a bill that could influence his personal stock-holdings.
Arguments aside, the controversy over Baker is essentially whether the thin line between good politics and politics for personal gain was crossed. The record uncovered so far points out the facts that Baker was in an "inside" position in the Senate. He was the pipeline between the majority leader and the rank and file. He could do favors and he could ask favors.
ON SEPT. 9, A MAN named Ralph Hill filed a $300,000 civil suit against Baker, claiming that Baker had used his influence to benefit himself.
Hill told the court that he paid Baker $5,600 "for services in securing and retaining" a $300,000-a-year vending machine franchise at Melpar, Inc., a Falls Church, Va., firm that does subcontract work for North American Aviation, a giant in the aerospace industry.
But, according to Hill, what Baker actually did, after taking the money, was to influence Melpar to cancel its contract with Hill's Capitol Vending, Inc., to the benefit of the Servu-V Uending Corp., a film that listed Baker's law partner, Ernest C.
Tucker, as board chairman, and Jaker's wife as assistant secretary.
Serv-U was considered a phenomena. In 18 months it signed contracts that would gross it over $3 million a year in sales to plants in the aerospace industry, which is dependent on government contracts. Baker denied Hill's charge. But the record shows that he was tied to Serv-U through an intricate series of financial dealings.
THE KEYSTONE of these ties was one of Baker's few well-known business enterprises—the $1.2 million "Carousel" a swank motel at Ocean City, Md. This advertised "hideaway for the advise and consent set" was owned by Baker and his wife, along with two other partners, a Mr. and Mrs. Alfred Novak.
When the motel opened its doors in July, 1962, then Vice President Johnson was on hand for a champagne party. But seven months later the hotel was deeded to Serv-U. On the same day, Serv-U gave the Bakers two promissory notes totaling 290,000.
Three weeks later Serv-U got a mortgage on the property for $748,000. Despite the fact that they had deeded away their interest, both Baker and his wife signed the note as borrowers along with Serv-U.
When the vending machine and motel deals were exposed to the light of publicity, they triggered a flood of details on Baker's financial dealings.
He was shown to have;
—FINANCED the purchase of a $28,000 three-story town house in Washington. On his applications for a Federal Housing Administration-approved loan, Baker listed Carole Tyler, his secretary, as the occupant, along with another capitol hill secretary, Mary Martin, a onetime aide
to Sen. George A. Smathers, D-Fla.
Under the terms of his loan agreement,
Baker or a member of his family had to live in the house,
Baker listed Carole Tyler as his "cousin". Now FHA has served notice that Baker must occupy the house or sell it.
A partnership in a Howard Johnson Motel outside Raleigh, N.C. Another partner was a Commerce Secretary Luther H. Hodges who sold his interest in the motel for $58,000 before taking his cabinet post.
—A home worth $125,000.Although Baker and his family lived in the house, it had been deeded to his law partner by the Tennessee Gas Transmission Co., its former owner.
AT FIRST, THE Senate had little to say about the Baker revelations. But as reported of his "moonlighting" ventures grew, so did the criticism.
Baker's resignation didn't bring him any peace and quiet. It merely intensified the investigation of his rags-to-riches story.
Finally, on Oct. 7, Baker resigned his job. Said his boss, Democratic leader Mike Mansfield: "I deeply regret the necessity for his resignation and the necessity for its acceptance."
By now the FBI was on the trail, trying to untangle his business pyramid. The Senate itself acted. The job of investigating Baker fell to the Rules Committee but the committee appointed an outside-the-Senate counsel, North Carolina lawyer L. P. McLendon.
DESPITE THE complexity of Baker's business dealings, there is nothing illegal about a man working outside his capitol hill job, or making money at it.
The question asked by Baker's critics is whether he used his connections in the Senate illegally to further his private ventures.
If he did, the critics ask, how common place is the practice? And how high up the ladder does it go? How congress itself can provide the answer?
New 'Family Intercom'
A home "intercom" for the whole family with up to seven stations linking to each other is the newest idea in Christmas gifts. The intercom, with "talk back" speakers, at the front door or other handy places are available. The set, which can be adapted to control cooling or sprinkler systems, have recently been put on the consumer market.
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Bread and Butter Budget Raised Over Guns in Soviet Parliament
MOSCOW — (UPI) The Soviet Parliament received for formal approval today an unprecedented $212.3 billion peacetime budget for the next two years that emphasized bread and butter instead of guns.
Premier Nikita S. Khrusheyhe looked on approvingly in the Grand Kremlin Palace as Finance Minister Vasilgarbuzov read out the figures, lopping off $666 million from defense spending for the next year.
At the same time $27.1 billion was allocated to the nation's failing agriculture over the next two years, and the green light was given to a chemical industry buildup which will supply the farms with fertilizer and also satisfy growing demands for more consumer goods.
KHRUSHICHEV AND his advisers had taken a cautious look into the future and apparently decided that some funds could be safely diverted from defense and massive sums poured into agriculture and the chemical industry to prevent a recurrence of this year's disastrous harvests.
The Soviet Union this year went abroad with its tons of gold to buy hundreds of millions of dollars worth of Western wheat to prevent drastic rationing or possibly even starvation.
Khrushchev said he wasn't going to let his people die of hunger as Stalin did.
U. S. Ambassador Foy D. Kohler and other envoys of both East and West watched the speaker read out to 1,444 deputies at a joint session of the Supreme Soviet provisions of the new budget—the first covering a two-year period so as to coincide with a re-jiggering of the final two years of the current seven year plan.
PYOTR LOMAKO, chairman of the state planning committee, presented a two-year economic plan to bring Soviet production by 1965 to the United States level of five years ago.
Lomako also expressed parliament's thanks to Khrushchev for this summer's treaty with the United States and Britain banning all but underground nuclear tests.
Khrushchev has continually cited this treaty as a point of departure in easing East-West tensions and reaching other agreements on outstanding issues.
Although cuts were made in defense, Finance Minister Garbuzov said Soviet defenses would be maintained "at a level that would ensure
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the security of the country and the entire socialist camp."
THE NEW BUDGET and state plan revealed a tremendous projected boost in the oil industry—38 per cent with the gas industry over the next two years—and a 22.7 per cent increase in agricultural investment.
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Every evening 'til CHRISTMAS
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SUA Art Lecture
December 17th 4 p.m.
Spooner Hall Art Museum
Mr.Gerald Bernstein
will speak on Van Gogh's 20th Century Legacy
That's this Tuesday- Dec. 17th!