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independent man
The Li i f e
of Senator
James Couzens
Harry Barnard
with an introduction by David L. Lewis


Harris & Ewing
SENATOR JAMES COUZENS


Wayne State University Press Detroit
INDEPENDENT
MAN: THE LIFE OF
Senator James Couzens
BY
HARRY BARNARD


Great Lakes Books
Humanities
MELLON
The publication of this volume in a freely accessible digital format has been made possible by
a major grant from the National Endowment for the Humanities and the Mellon Foundation
through their Humanities Open Book Program.
This book was originally published in 1958 by Charles Scribner’s Sons.
Copyright © 2002 by Wayne State University Press,
Detroit, Michigan 48201. All material in this work, except as identified below,
is licensed under a Creative Commons Attribution-NonCommercial 3.0
United States License. To view a copy of this license,
v isit https ://creati vecom mons. org/licenses/by-nc/3.0/us/.
All material not licensed under a Creative Commons license is all rights reserved. Permission
must be obtained from the copyright owner to use this material.
Library of Congress Cataloging-in-Publication Data
Barnard, Harry, 1906-
Independent man: the life of Senator James Couzens / by Harry Barnard,
p. cm. — (Great Lakes books)
Originally published: New York: Scribners, 1958.
ISBN 978-0-8143-4396-8 (pbk.: alk. paper); 978-0-8143-3587-1 (e-book)
1. Couzens, James, 1872-1936. 2. Legislators—United States—Biography.
3. United States. Congress. Senate—Biography.
4. Michigan—Politics and government—1837-1950.
I. Title. II. Series.
E748.C87 B3 2002
328.73*092—dc21
[B]
2002069138
FOR PERMISSION TO QUOTE BRIEFLY FROM THE FOLLOWING SOURCES,
THE AUTHOR MAKES GRATEFUL ACKNOWLEDGMENT.
America in Midpassage by Charles A. and Mary R. Beard
(The Macmillan Company, 1939)
Inside U.S.A. by John Gunther (Harper and Brothers)
Letters of Franklin D. Roosevelt by permission of Mrs. Franklin D. Roosevelt
“Michigan Magic” by John T. Flynn (Harper’s Magazine, December 1933)
Wild Wheel, The by Garet Garrett (Pantheon Books, Inc.)
Wayne State University Press thanks Frank Couzens Jr.
for his generous permission to reprint material in this book.
http://wsupress.wayne.edu/


vii
CONTENTS
FOREWORD xi
INTRODUCTION XV
A NOTE ON THE AUTHOR XXiii
Prologue: October 12, 1915 1
Book I: The Money-Making Machine 9
1. THE BEGINNING II
2. THE CANADIAN BOY 13
3. THE MONEY-MAKING MACHINE, I 18
4. THE NEW DETROITER 2J
5. THE COAL CLERK 29
6. THE FAMILY MAN J/
7. THE FORD MOTOR COMPANY 33
8. THE BUSINESS MANAGER
9. THE CLOUD
10. THE REALIGNMENT 36
11. THE MONEY-MAKING MACHINE, II 66
12. THE CRISIS 72
13. THE FIVE-DOLLAR-A-DAY PLAN 83
14. THE FINAL BREAK p^
Book II: The New Public Man ioi
15. THE JOB-SEEKER AGAIN /OJ
16. THE POLICE COMMISSIONER JO7
17. THE ODD CANDIDATE jjp
18. THE STRONG MAYOR 7/7
19. THE PEOPLE’S MAN I2 2
20. THE BATTLE FOR M.O. I2 6
21. THE “DAMNABLE OUTRAGE” jpj
22. THE REWARD


Viii CONTENTS
Book III: The Senator 139
23. THE ONE-MAN BLOC I4 1
24. THE PLAIN-SPEAKING STATESMAN J*i2
25. THE MILLIONAIRES’ WAR 158
26. “the la folletteite!” 168
27. THE CRITIC OF COOLIDGE IJ4
28. THE RESTLESS STATESMAN l8l
29. THE MAGNIFICENT GIFT 186
30. the “dangerous man” 193
31. THE CRUSADER AGAIN 200
32. THE END OF AN ERA 208
Book IV: The Independent Man 211
33. THE BANK CRISIS 21)
34. THE WHITE HOUSE CONFERENCE 221
35. THE CLIMAX 228
36. “A HELL OF A MESS” 2))
37. THE MISSION THAT FAILED 243
38. THE NEW DEAL ONLOOKER 2))
39. THE INVESTIGATOR AGAIN 262
40. THE DELEGATE TO LONDON 268
41. THE SMEAR 2J)
42. THE NEW DEAL REPUBLICAN 291
43. THE UNBOWED HEAD 298
44. THE POLITICAL DILEMMA 303
45. THE INDEPENDENT MAN ^11
46. THE TRIUMPHANT DEFEAT
47. “the end of the Road” ^ 22
Notes ^ 2 p
Bibliography ^9
Index 3 $ 9


FOR
Alfred P. Solomon
and Esther, too
FRIENDS
AND
COUNSELLORS


XI
FOREWORD
The James Couzens in Independent Man was not the James Couzens I
knew. I was his first grandchild, born in 1924, and probably because I
was a first grandchild I received a lot of attention and many favors. My
grandfather loved all of his grandchildren, and we loved him. We
knew him as Daddy Jim.
In the summer, our family lived at Wabeek Farms, as did my aunt
and uncle and their children, the Yaw family. On Sunday mornings I
looked forward to my grandfather picking me up for a ride in his sta
tion wagon. He would show me his fields, the cows, the chickens, and
the creamery. One Sunday he drove by the little cemetery on
Middlebelt Road and told me that was where he would be buried. This
was not where they buried him.
He had a smooth and effective way of correcting my poor manners.
One day while having dinner at his home, he observed me trying to
cut my meat with my elbows up in the air. He asked, “Are you trying to
fly, Frank?”
Once he took us grandchildren to the Bloomfield Hills Country
Club for lunch, as a treat. My grandfather didn’t think that anyone
should have to eat spinach, so he was really perplexed when we all
ordered spinach. He didn’t know how much we wanted to be like
Popeye.
From the Senate he wrote to me in his beautiful handwriting. I did
not fully appreciate those letters at the time. My mother, Margaret
Lang Couzens Slattery, would see to it that I would write him back,
usually when I was trying to listen to a Detroit Lions game. The writ
ing had to be neat, the lines straight, and the spelling perfect. This
required many rewrites, which decreased my appreciation for my
grandfather’s thoughtfulness.


Four generations of Couzens men. From left to right: James Joseph Couzens,
Frank Couzens, Frank Couzens Jr., and James Couzens.


FOREWORD
Xlll
I truly looked forward to being with him; he was fun. On a couple
of occasions, I was invited to go on a Great Lakes cruise with him, my
grandmother, and my Aunt Betty. During each of two summers in the
late 1930s Grandfather chartered a beautiful yacht. One was the
Buccaneer and the other was the Trudeon. These yachts were too large
to dock in most harbors. They would drop anchor and we would go
ashore in one of the launches. Once we went ashore in Green Bay,
Wisconsin, to meet one of my grandfather’s colleagues, Senator
LaFollette. This was before ship-to-shore radiotelephones; each yacht
had a radioman or a signalman, and Morse code was the way commu
nications were received and sent. We knew by flashing signal lights
when to meet the Senator on shore, and Morse code radio transmis
sions were how my grandfather received the morning news and com
munications from shore. It was also very exciting, especially for a teen,
to be in the Chicago harbor in 1934 the night John Dillinger was shot.
We wondered the next day if the shots we heard in the night were the
same that killed the infamous gangster.
We did not hear about my grandfather’s business dealings or his
Senate agenda. He loved his farm and his Ford station wagon. The les
son from Daddy Jim was, “Do it right,” and “Fulfill your commit
ments.” I am still working on these lessons.
Frank Couzens Jr.
January 2002


xv
INTRODUCTION
Independent Man: The Life of James Couzens and I have been friends since
1958 when it was used in the preparation of my doctoral dissertation
on Henry Ford. My copy cost $5.95. Present-day buyers pay more, but
they, too, have made a sound investment.
Independent Man, a perfect tide, has been out of print for many years
(its publisher, Charles Scribner’s Sons, does not know how long it has
been unavailable or even the number of copies that were originally
printed). Kudos to the Wayne State University Press for reprinting
the only book-length biography of one of Michigan’s most remark
able men.
Born in Chatham, Ontario, in 1872, Couzens moved to Detroit in
1890. Able, exacting, truculent, he had a don’t-tread-on-me attitude
reinforced by outspokenness and a terrible temper. On the job,
wags said, when he smiled his annual smile, the ice broke up on the
Great Lakes.
Couzens was a paradox. All business from his bump-toed shoes to
his derby hat, he was a loving family man with compassionate, even
tender, feelings toward children. His children and grandchildren
called him “Daddy Jim.” A capitalist multimillionaire, he had pro
foundly democratic instincts, and earned an unparalleled reputation
as a radical. He was a dragon at the cashbox, but gave away most of his
fortune. Although appreciative of publicity, he was tactless with the
press, characteristically ordering the Detroit News to fire an offending
reporter and forbidding the publication to “ever again mention the
name of the Ford Motor Company.”
Independent Man focuses on Couzens’s careers with Ford, the city of
Detroit, and the United States Senate, plus his embroilment in


XVI
INTRODUCTION
Detroit’s 1932-1933 bank crisis and the New Deal.
Couzens contributed as much to Ford Motor Company’s early suc
cess, even survival, as Henry Ford. The two men did not partner by
choice. They were tossed together when Ford’s principal associate,
coal dealer Alex Malcomson, assigned Couzens, a trusted employee, to
watch over the Ford Company’s business affairs. While Ford devoted
himself to technical matters, Couzens ruled the rest of the firm. From
the outset he deemed it good business to publicize Ford. “Our Mr.
Ford made the first Gasoline Automobile in Detroit and the third in
the United States” (both claims untrue), proclaimed one of his ads.
Another declared that “Henry Ford has been the greatest factor in the
development of the automobile industry... in the world.” When given
such bouquets, Henry kept the flowers. Within a few years Couzens
could have echoed racing champion Barney Oldfield, “Ford and I
made each other, but I did much the best job of it.”
Couzens also initially credited Ford with having originated the com
pany’s famed five-dollar day in 1914. “It was quite natural that Mr. Ford
should be credited with this project,” he said, “because he was the
head of the company, a majority stockholder, and it was to the benefit
of the Ford Motor Company ... to keep the name Ford much more
before the public.” After leaving the company, however, Couzens said
of the plan, “I will say that I, personally, am responsible for it.” Over
the decades a spirited, futile discussion has ensued as to whether the
larger credit belongs to Ford or Couzens. Suffice it to say, as historian
Allan Nevins has noted, ‘The proposal would probably have been
vetoed had Couzens violently opposed it, and could certainly never
been approved without Ford’s hearty support.”
Couzens and his sister, Rosetta, owned 10.5 percent of the Ford
Company from 1906 until 1919; Ford held 58.5 percent. The partners
were not fond of each other, as indicated by a wide gap between them
in formal photographs. By working in separate spheres, however, they
avoided a major clash until 1915. That year, divergent views on
America’s World War I neutralism, war loans to the Allies, and nation
al preparedness, prompted a showdown and Couzens’s resignation
from the company. In 1919 he sold his stock to Henry Ford for
$28,308,857, receiving a higher share price than any other shareholder.
Before leaving Ford, Couzens accepted the chairmanship of the
newly-formed Detroit Street Railway Commission, set up to force
municipal ownership of the streetcar lines. During a bitter, seven-year


INTRODUCTION
XVII
fight, the privately-owned Detroit Union Railways raised fares from
five to six cents. Couzens, by then Detroit’s police commissioner,
brought in the press to witness his refusal to pay the extra penny and
be evicted from a car. The fare increase was rescinded, and Couzens
gained in public favor. In 1922, by which time Couzens was mayor, the
city acquired the rail company.
Couzens’s rancorous police commissionership (1916-1918) paved
the way to the mayor’s office. Couzens’s own car was stolen during his
first month on the job. The populace also was amused, as well as
alarmed, by the commissioner’s insistence on strict enforcement of
laws governing gambling, prostitution, and Detroit’s 1,400 saloons.
The cleanup campaign petered out, Detroiters being less amenable to
marching orders than Ford workers. Of his campaign, Couzens
summed up, “They wanted me to clean [the city] and not clean it.”
The commissioner was even hauled off to his own jail, after refusing
to pay a $100 contempt-of-court fine.
Couzens enjoyed being in the public eye-albeit like a cinder, some
said-and convinced himself that he was needed and electable as
Detroit’s mayor. Others disagreed. John Dodge did not think he could
be elected “dog catcher or coroner.” E. Roy Pelletier, ex-head of Ford
advertising, refused to handle Couzens’s publicity, saying it was impos
sible to “sell a man so lacking in good fellowship.” Couzens nonethe
less won handily, voters being persuaded by his promise to conduct
himself “so that I have my own self-respect, regardless of whether peo
ple like me.”
As mayor, the “maverick millionaire,” as Couzens was called, con
tinued to challenge accepted patterns of conduct and to provide bold,
energetic leadership. At a time when the rapidly-growing city needed
improved, expanded schools, sewers, streets, municipal hospital facil
ities, and other services, he drew up plans for the expenditure of
$243,000,000, an astounding figure for that era.
Couzens’s temper was not improved by the mayor’s office. If he was
not denouncing the Detroit Board of Commerce leaders as a “pack of
curs,” he was branding Detroit Edison’s president a “liar,” the latter
epithet earning him ejection from City Council chambers. City Hall
workers fumed when the mayor insisted that they start work at 8:30
A.M. and put in a “full day’s work.” Asked why he worked on holidays,
when others were out playing, he replied, “I have to make good on this
job.” In Harry Barnard’s view, he was “one of the few outstanding may-


xviii
INTRODUCTION
ors in American history,”
Late in 1922, following Truman H. Newberry’s forced resignation
from the United States Senate, Couzens was appointed to that body by
Republican Governor AlexJ. Groesbeck. A constant thorn in the side
of his party, Couzens summed up his political views with the statement,
“I am a Republican, but not like Harding, Coolidge, and Hoover! . . .
If being a Republican means kowtowing to the President, I do not care
to be a Republican.” A newspaper headline accurately pegged him as
“James Couzens-One-Man Bloc.” Hoover described him as “a very
dangerous man.”
Couzens repeatedly shocked fellow Republicans on issues ranging
from liberalizing national prohibition laws to demanding the first
investigation of the Department of Internal Revenue. When Secretary
of the Treasury Andrew Mellon counterattacked by investigating
Couzens’s tax returns, the senator proved in court that he had over
paid $900,000 in taxes when selling his Ford stock.
In 1933 Couzens became embroiled in Detroit’s bank closings.
Many people and institutions were blamed for triggering the crisis and
failing to solve it. Leading scapegoats were President Hoover,
President-elect Roosevelt, the Reconstruction Finance Corporation,
the Senate Finance Committee, Henry Ford, and the Communist
Party. Couzens received far more criticism than anyone else. Many said
that an RFC loan could have saved the Motor City’s banks had not
Couzens blocked an aid package, and that the senator balked partly
because he hated Henry Ford and all other rich Detroiters. In refut
ing this thesis, Barnard asserts “if any one person forced the bank hol
iday this person was not Couzens, but Henry Ford.” In 1934 Couzens’s
public reputation sank to an all-time low. Late in the year, Couzens’s
son, Frank, was elected to the first of two terms as mayor of Detroit.
‘That shows,” the defensive father said, “that I haven’t ruined the fam
ily reputation after all!”
The banking crisis was thoroughly aired in a grand jury investiga
tion in 1933 and by a Senate subcommittee the following year.
Couzens, who received extremely unfavorable press during the first
probe, redeemed his battered reputation somewhat during the Senate
inquiry. Interestingly, John Kenneth Galbraith, in his generally favor
able review of Independent Man in the New York Times, is critical of
Barnard’s account of the banking crisis. “A biographer,” he observed, “is
a biographer and not a boxing ring second or a counsel for the defense.”


INTRODUCTION
XIX
Couzens admired Roosevelt from the time they first met immedi
ately after FDR’s 1933 inaugural address. “He’s human,” he said of the
Chief Executive. Moreover, he often preferred Roosevelt’s policies to
those of his own party, especially with the coming of the New Deal.
Indeed, Couzens anticipated the New Deal’s public works programs,
having publicly stated in 1931 that the government should “make work
by building libraries, museums, highways, bridges, and schools” even
if it meant tripling the federal debt.
Couzens’s freewheeling independence eventually led to his political
demise. He was anathema to Republican party regulars, and he had no
political organization of his own. Couzens also alienated many voters
by opposing such proposals as an ex-soldiers’s bonus and the
Townsend Old Age Pension Plan. Finally, in 1936 he supported
Roosevelt’s bid for reelection, heresy for a Republican. Michigan’s
Republican Party selected ex-Governor Wilber M. Brucker to run
against Couzens in that year’s primary, and Couzens’s defeat was a
foregone conclusion. In the long run, even in the short run, it did not
matter. He was ailing, and had only two months to live.
Characteristically, Couzens remained independent to the last.
When Franklin Delano Roosevelt arrived in Detroit on Oct. 15, 1936,
to campaign, he offered to visit the senator at Harper Hospital.
Couzens would not hear of it. Leaving his bed, he met FDR at the train
station and accompanied him on a parade through Detroit’s streets, at
a rally at Hamtramck Stadium, and at a mass meeting at Detroit City
Hall. Exhausted, Couzens returned to the hospital, where uremia
aggravated his medical problems. A week later he underwent an oper
ation, from which he did not awaken from the anesthetic.
If Couzens is less well remembered than he should be, it was the way
he wanted it, for, with two exceptions, he refused to permit buildings
or institutions to be named for him. By way of contrast, a list of Henry
Ford-related nomenclature fills six pages of the Ford Legend.
Two buildings, two streets and a commercial enterprise have borne
Couzens’s name. Investing in downtown Detroit real estate in 1911,
Couzens built the Couzens Building on Woodward Avenue. Its fate is
unknown. In 1924 the name Couzens Residence for Nurses was given
to a Couzens-financed ($620,000) dormitory at the University of
Michigan in Ann Arbor. Although Couzens was indignant upon learn
ing that the institution’s regents had acted without his consent, he let
the matter stand. Enlarged in 1960, five-story Couzens Hall went coed


XX
INTRODUCTION
in 1970 and now houses 613 students, mostly freshmen. Its library
lacks a copy of Independent Man; I have promised to provide one.
Couzens donated a comparable nurses’s dormitory to Detroit’s
Harper Hospital in 1919. The name ‘The James Couzens Home” was
proposed by hospital officials. When Couzens demurred, it was named
for the head nurse, Emily A. McLaughlin. Today, six-story McLaughlin
Hall is occupied by hospital office workers.
Hazel Park, a northern Detroit suburb, has a Couzens street, the
origins of which are obscure. When Detroit’s John C. Lodge
Expressway (M-10) was extended in the early 1960s, the portion from
the “Linwood Curve” to Eight Mile Road was named ‘James Couzens
Expressway.” Two decades later the state dropped the name ‘James
Couzens” in favor of John C. Lodge Freeway. Signs on the Lodge’s
service drives are still marked ‘James Couzens” from Wyoming Avenue
to Eight Mile.
In 1926, Couzens, desperate to be “active,” organized the Couzens
Ice Machine Company, capitalized at $1,000,000. Two factory sites
were bought, one in Detroit, another in Wapakoneta, Ohio. Dealers
were signed, literature printed, and sample machines displayed. At
that point, Couzens, without explanation, abandoned the enterprise
at great loss.
Couzens’s greatest benefaction, the Children’s Fund of Michigan,
would have been named the Couzens Foundation if Couzens’s associ
ates had prevailed. The philanthropist not only rejected the name, but
also stipulated that the Fund—established in 1929 with a gift of
$10,000,000-spend itself out of existence within 25 years.
The Fund supported children’s agencies and also initiated pro
grams in underserved areas of children’s medicine in the hope that
they would attract private and/or government grants after the Fund’s
demise. Thus the Fund built and operated the Children’s Hospital of
Michigan, Northern Michigan Children’s Clinic at Marquette and the
Central Michigan Children’s Clinic at Traverse City. For decades
Couzens family members have maintained a direct interest in
Children’s Hospital. Margaret Couzens Slattery, the philanthropist’s
daughter-in-law, served as a trustee for 60 years, 16 of them as presi
dent and chairperson. Mrs. Slattery’s son, Frank Couzens Jr., and
Frank’s daughter, Carol Marantette, are present-day trustees.
During its lifetime, the Children’s Fund distributed $18,038,656, a
sum which included the original $10,000,000 grant, an additional gift


INTRODUCTION
XXI
of $1,880,000 from Couzens, and income derived from principal.
Couzens’s total philanthropy, $30,000,000, approximated the sum he
had received for his Ford stock.
Two of Couzens’s residences remain in use. An Albert Kahn-
designed home at 610 Longfellow Avenue, Detroit, in which the fami
ly lived from 1910-28, was given to his son Frank. Frank’s widow, after
moving from the house in 1962, gave it to the Maryknoll Fathers, who
subsequently sold it. Today, a neighbor reports, it is a “terribly neg
lected private residence.”
Couzens’s last home, on his 800-acre country estate, Wabeek, was
sold by the family in 1968 to Chrysler-Wabeek Development Company,
a joint venture of Chrysler Realty Corporation and Arizona-based Del
E. Webb Inc. Subsequent development produced the Wabeek
Country Club, a 145-acre golf course, and hundreds of upscale hous
es and condominiums. The 12,000-square foot mansion, set on 2.23
acres at 3550 Wabeek Lake Drive, Bloomfield Township (its present
address), housed a sales office from the late 1960s into the 1980s.
Vacated for some years, it was restored by a Birmingham attorney,
Leonard Hyman, and his wife, Virginia, and resold in 2000 as a private
residence. Asking price: $3.8 million.
Couzens’s imposing mausoleum vies with those of John and Horace
Dodge and J. L. Hudson as Detroit’s largest tomb. Set on a 15,526
square-foot lot—big enough to accommodate 200 burial sites—it
commands the highest elevation in Woodlawn Cemetery, the Motor
City’s premier cemetery. The edifice, built of Barre granite, resembles
a mini-Parthenon. Its twelve crypts will be filled with the future
entombment of an unmarried Couzens granddaughter. The interior
has a huge solid bronze crucifix, a beautiful altar, a prayer bench, and
space enough for 15 to 20 persons to attend occasional masses (Mrs.
Couzens was a Roman Catholic; her husband was not).
The mansion and mausoleum, believes Couzens’s grandson, Frank
Couzens Jr., were built mainly for the gratification of his grandmoth
er, a member of a leading Detroit family. Still, one is bemused to find
that Detroit’s “man of the people” is entombed in a structure that cost
more than $100,000 in 1921. In contrast, Henry Ford’s grave is
marked by a simple white marble stone in a small Ford family ceme
tery on Detroit’s west side. Edsel Ford, the state’s second most wealthy
citizen, has a relatively modest tomb in Woodlawn.
Couzens is minimally remembered today, even by the global com-


XXII
INTRODUCTION
pany he helped build. All the more reason to commend Wayne State
University Press for preserving his memory with this reprint of
Independent Man, which, as a reviewer for the Nation observed, “has not
an unclear sentence from beginning to end.” If he were alive, Couzens
would ask no more—and demand no less.
David L. Lewis
Professor of Business History
University of Michigan


xxiii
A NOTE ON THE AUTHOR
Surprisingly, Independent Mans first printing omits biographical infor
mation on the book’s author; we’ll remedy that shortcoming here.
The son of an oculist, Harry Barnard was born with the surname
Kletzky in Pueblo, Colorado, in 1906. After receiving a Ph.B. from the
University of Chicago in 1928, he served from 1929 to 1957 as a
Chicago newspaperman, University of Chicago research and press
relations director, and Detroit advertising agency publicist. In 1938
and 1954 he authored biographies of two half-forgotten men, Illinois
Governor John Peter Altgeld and President Rutherford B. Hayes.
Declaring himself a freelance writer in 1957, Barnard, who
described himself as a “Jeffersonian-Altgeldian-Rooseveltian-
Independent-Liberal-Democract,” subsequently wrote five books, most
notably Independent Man and The Forging of an American Jew: The Life and
Times of Judge Julian W. Mack (1974). The Couzens book so favorably
impressed John Shively Knight, publisher of the Knight Newspapers,
that he invited Barnard to write an editorial-page column for his
Chicago Daily News. The column, “Liberal at Large,” was nationally dis
tributed by the Des Moines Register and Tribune Syndicate. An active
supporter of liberal causes, Barnard lived in Wilmette, Illinois, until
his death in 1982. His papers are in the University of Wyoming’s
American Heritage Center.


PROLOGUE:
October 12, igifj



3
PROLOGUE
OCTOBER 12, igij
When the story broke, it shoved the European war dispatches into
a subordinate position in newspapers all over the world. In London
as well as in Copenhagen, not to mention New York, Chicago, St.
Louis, and Los Angeles, this was true. The newspapers in Detroit
put out extras with big headlines:
COUZENS LEAVES FORD!
Days afterward, from one coast of the United States to the other,
the press continued to feature special commentaries and so-called
“inside” stories about the man who left Ford.
There were stories, too, about the reasons (true, speculative, or
imagined) for the startling separation that concerned the world's
most conspicuous industrial enterprise—the Ford Motor Company
of Detroit, U.S.A. If Henry Ford himself had quit, or had even
simply disappeared, the sensation could scarcely have been greater.
“But none of the stories, then or later, of why it happened, came
within one and one-half percent of the truth.” So, years after, said
John C. Lodge, the venerable ex-councilman and ex-mayor of Detroit.
He was one of the very few people in all the world who knew both
principals in the stories well enough to call the one “Jim” and the
other “Henry.” And Lodge believed that he at least had heard the
“whole truth” from the lips of both “Jim” and “Henry”—but he
wasn't telling, for he had been “pledged” not to tell.
Yet the whole truth was that no one really had told the whole
truth—not “Jim” and not “Henry,” not even when they had in
fact tried to unburden themselves of the full story to old John Lodge.
This is not strange. In such matters, the truth is almost always linked


4
PROLOGUE
with, and enveloped in, motives and aspects deeply psychological,
things usually veiled—veiled most of all, perhaps, from the princi
pals themselves. They can tell of the incident itself, the “what” of
the occurrence. But they are not able to tell of all that really lay
behind it—the “why.” Such, clearly, was so in the case of James
Couzens and Henry Ford—without either of whom the company
that bore the name of Ford would never have been of interest to
anyone outside of Detroit.
The “what”—the bare facts—may be pieced together briefly.
On the evening of October 11, 1915, Charles A. Brownell, who
uneasily wore the title of advertising manager, had stepped, just
before closing time, into the office of the Vice President, Treasurer,
and General Manager of the Ford Motor Company.
Brownell, usually the opposite of a timid man, made his entrance
with the attitude of caution and wariness customarily adopted by
nearly everyone who went into that office. For Brownell had come
to see “Jim”—though, to be sure, he did not refer to the Vice Pres
ident, Treasurer, and General Manager of the Ford Motor Company
as “Jim,” but rather as “Mr. Couzens.” His mission was to get
Couzens’ approval of the page proofs for the next issue of the Ford
Motor Company magazine, the Ford Times. He was acting in ac
cordance with a rule that everyone in the Ford organization under
stood in those days—that Mr. Couzens had to approve everything
(or nearly everything) the company did, and of late this had applied
especially to articles in the Ford Times.
Brownell handed Couzens a set of the proofs. In his characteristi
cally quick way, Couzens thumbed through them, while Brownell
held his breath. Nothing objectionable to Couzens turned up—
until his eyes fell upon one particular article.
The effect on him of glancing at this article was an almost instan
taneous—and characteristic—reddening, first of his neck and then of
his face—danger signs that all who knew him well understood.
The article that produced this redness contained the substance
of remarks previously published in the Detroit Free Press and
credited to Henry Ford, remarks concerning the war in Europe and
the “preparedness movement” in the United States.
The tenor of these remarks was distinctly “pacifist”—of the kind
that led a little later to Ford’s being persuaded to sponsor his cele
brated Oscar II “peace ship” venture.


PROLOGUE: OCTOBER 12, 1915
5
“You cannot publish this,” Couzens told Brownell.
“But Mr. Ford himself—”
“You cannot publish this! Hold it over.”
“But Mr. Ford said—”
“These are Mr. Ford’s personal views, not the views of the com
pany. This is the company paper. He cannot use the Ford Times for
his personal views. I will talk to Mr. Ford tomorrow.”
Brownell withdrew without saying anything more. He knew a
decision had been made at the Ford company—when Couzens had
made it.
After Brownell had departed, Couzens turned his swivel chair
away from his flat-top desk and shut violently the roll top of his
“aft” desk.
These two desks formed the nerve center of the Ford Motor
Company. To them came the reports from the 6,700 Ford agents,
the thirty-five Ford branches, the twenty-six Ford assembly plants,
the forty-eight American banks, and the two foreign banks in
which the Ford company millions were deposited. From these desks
came the decisions that guided the company’s affairs throughout its
already vast empire in the United States and abroad, every place, in
fact, except in the main shop and in the laboratory (Mr. Ford’s partic
ular bailiwicks)—and sometimes in these places as well.
Couzens got up briskly. He walked over to his clothes rack and
planted a black derby firmly on his prematurely gray head. For a
moment he stopped before the mirror over the wash basin to adjust
his necktie knot to a precisely correct position in his high, stiff
collar, flicked away some dust that may or may not have been on
his jacket sleeves, thriftily turned off the office lights, and, in an
instant, with his usual quick gait, left the office of the Ford Company
for his home.
His movements that evening, down to the last gesture, were all
routine for him. He had gone out of the Administration Building
that same way night after night since it had been built. But, after
arriving home, he went to bed earlier than usual that night, explain
ing to his wife, Margaret, that he had one of those headaches which
his doctors called “migraine.”
At ten o’clock the next morning, Henry Ford came into Couzens’
office. “He was perfectly good-natured. He sat and visited awhile,”
Couzens later described the meeting.
The two “partners,” as they were known, talked of Couzens’ re-


6
PROLOGUE
cent trip to California, of Ford's plan to attend the San Diego Ex
position there with Thomas A. Edison. Then Couzens said to Ford,
‘‘I held up the Times because of your article in it about the war."
Suddenly, as if a match had been touched to gunpowder, the calm
and friendly atmosphere in the office exploded.
Ford's geniality changed swiftly into something else—a belliger
ence not usually associated with Henry Ford in those days, an
attitude he had certainly never before shown so sharply to Couzens,
although others in the company already knew that Ford was capable
of such a transformation. As Couzens himself said some time later,
“Mr. Ford just flew off the handle ... I was shocked . . . aghast."
Couzens did not recall in detail everything Ford said on that
occasion. But he did remember Ford's having snapped:
“You cannot stop anything here!"
“Well, then, I will quit," Couzens replied.
Ford suddenly seemed to calm down.
“Better think it over," he said.
“No, I have decided," Couzens said.
“What will you tell the papers?" Ford asked.
“That we disagree about the war."
“All right, if you have decided," said Ford.
So these two—“Jim" and “Henry,” who had been referred to in
a business publication only a few weeks earlier as “The Damon and
Pythias of the Ford Motor Company"—had separated.
And it all happened in less time than it takes to set it down. 1
For some time a few persons in the automobile industry had
known that there was trouble between the “partners," but no one
ever assumed that matters would come to this. A Ford Motor Com
pany without James Couzens would have then been as unthinkable
as a Ford Motor Company without Henry Ford. Indeed, there were
those who said that the Ford Company up to then was mainly
Couzens. Of course, this was not true. Henry Ford could not be
dismissed so casually. Conjecture about a Fordless Ford Motor Com
pany is unrealistic. The Ford certainly was Ford's car, though, to
be sure, C. Harold Wills, as well as certain other mechanics and
designers including the Dodge brothers, John and Horace, had
contributed to its creation. Similarly, the Ford ideas of factory pro
duction were more Henry Ford’s than anyone’s else, even though
Walter Flanders, the Dodges, W. F. McGuire, Wills, Charles E.


PROLOGUE: OCTOBER 12, 1915
7
Sorensen, and others contributed to their development and practice.
Yet, indisputably, Couzens had played a role in the company that
was decisive—as decisive as Ford's.
It was Couzens, for example, who had been responsible for the
five-dollar-a-day wage plan which electrified the world in 1914. More
than anything else, this plan gave the Ford Company its first in
ternational reputation. Ford himself once wrote (or had written for
him):
“Ideas are of themselves extraordinarily valuable, but an idea
is just an idea. Almost anyone can think up an idea. The thing that
counts is developing it into a practical product."
And that was where Couzens figured in the Ford Company picture.
Norval Hawkins, the Ford sales manager in the halcyon days of
the Model T success, once summed up the story quite accurately.
“Mr. Couzens was a very remarkable man, as remarkable, in many
ways, as Mr. Ford. Mr. Couzens was responsible for at least half of
the success of the Ford Motor Company . . . Mr. Ford required just
the type of man that Mr. Couzens was to occupy the front seat, and
had Couzens been a less indefatigable worker, or a man who paid less
attention to the details of that business ... it might not have been
as successful as it is today. ..." 2
Barron’s, the financial weekly, said of Couzens in 1915:
“For twelve years he was with Henry Ford and it is an open ques
tion if the reverse order of the statement might not be fairly ac
curate. . . . The public thought of him all the time as entitled to
equal credit with 'Henry' for the marvelous success of the motor
enterprise."
John Wendell Anderson, one of the two Detroit lawyers who
were among the original stockholders (and to whom it was worth
literally millions of dollars, on the basis of a $5,000 investment, to
watch the affairs of the company closely from the very start) said:
“It was due to his [Couzens'] efforts that the company became a
success. The team work of himself and Mr. Ford contributed to its
success to a much greater extent than either one of them could
possibly have done alone." 3
Many more such statements from those who knew how the com
pany had been created and guided in its formative years could be
compiled. But such compilation was not at all necessary in 1915—
the very year, incidentally, in which the millionth Model T came
off the assembly line at the Highland Park plant, a production and


8
PROLOGUE
sales record that seemed incredible at the time—for the facts about
Couzens’ role in the company were widely known in the world of
commerce and industry.
Then, suddenly, Couzens was out of the Ford picture.
Everywhere the question was asked: “What will become of the
Ford Company?”
Some predicted that the Ford Company would go the way of
hundreds of other motorcar manufacturing companies, the names
of which only antiquarians in the field would now remember. Re
calling what they knew (or thought they knew) of Henry Ford and
his commercial views, they shuddered over what they supposed would
be the future of the company. James Couzens himself, however,
knew (or thought he knew) the answer to the fears expressed for
the company. Just after October 12, 1915, he said:
“I hope I have assisted in so perfecting the organization of the
company that my resignation will not make a pin’s worth of differ
ence. Mr. Ford agreed that his own resignation would not make a
pin’s worth of difference. The momentum of the business is too
great . . .”
And this, of course, proved absolutely true. Indeed, as would
be demonstrated around 1928, when Henry Ford was still clinging
tenaciously to the Model T long after the public had begun to
reject it, and again as demonstrated in another crisis period of the
1940’s, the company had been built on such a strong foundation
that not even Henry Ford himself could wreck it.
“What will Couzens do?” was another question widely asked.
He was then only forty-three. Financially he was worth anywhere
from forty million dollars to fifty or even sixty million, depending
on the value of his Ford stock and on investments he had made with
Ford dividends and his salary. He was energetic and intellectually
alert. In this respect, in fact, he was in his prime. But he had come
to the end of his road—or so he thought. It seemed clear to others,
however, if not to himself at just that moment, that a man who could
walk out deliberately, as he had just done, on a business that was
acclaimed “The Seventh Wonder of the World,” undoubtedly would
find another road, perhaps an even more rewarding and satisfying
one. His role in the development of the Ford Company, important
as it was, actually was but prelude for an even more important role
on the stage of the modern industrial era—the motor age—which
he had helped to usher into being in America.


BOOK ONE
The Money-Making Machine



11
CHAPTER I
THE BEGINNING
Properly the story of James Couzens had its real beginning in the
fall of 1870, two years before he was born. This was when his father
stepped off a train in the windswept little town of Chatham, Ontario
Province, Canada.
An immigrant tossed up by economic depression and also pro
pelled by deep-seated inability to get along with his own father,
this traveler, then twenty-one, had been en route to the United States
from London, England. His goal was a better living than he be
lieved he could achieve at home, for he was convinced that London
in 1870 was “finished and had no future.” 1
To be sure, this precise-looking, sober-miened Englishman named
James Joseph Couzens was not so dull as to believe with any strong
faith that nondescript, tiny Chatham really promised a much better
future for him than had London. The fact was that he had not even
heard of Chatham in Ontario before arriving there by the slow
train he had boarded at Levis, Quebec, where his ship had docked.
But he had rechecked the contents of his purse and concluded that
the little funds he had left made it impractical for him to travel
the fifty miles farther to Detroit, his original destination. So with
British prudence he decided to stay right there at Chatham.
2
This was a mistake. Though not a man to admit error readily,
he sometimes conceded this in after years, especially since his de
cision deprived his children, in particular his first son, of something
that might have made a great difference: United States citizenship
by birth.
However, he did have a sentimental rationalization to justify
the error. He asserted later that he had rather fancied the idea of


THE MONEY-MAKING MACHINE
12
settling in a town, even an unattractive one, that bore the same name
as the great naval-station city of Chatham in England, which was
the home of the girl to whom he had become betrothed just before
leaving London. But if this was a factor, one can be sure that not
often afterward did James Joseph Couzens permit any such romantic
notions to shape his conduct. Practicality was stamped all over him.
3
His training was that of an ordinary grocer’s apprentice, and he
knew his status. Yet in his manners and bearing there was a kind
of special promise, a certain aristocratic air, a kind of self-assured
dignity almost out of place, even somewhat humorously incongruous,
in Chatham at that time, especially for an immigrant, job-seeking
grocer’s clerk. Years after he had left Chatham, people there still
remembered this characteristic that had marked him when he first
arrived. They also remembered the fact that, very early, he revealed
an ingrained streak of belligerence (something he was destined to
pass on to at least one son), the trait that had made his relationship
with his father, a bailiff, less than tolerable.
He had a way of speaking that of itself set him off from others.
He spoke in an especially polite and trimmed way. His style was
not, to be sure, the cultivated one of Mr. Gladstone, the Prime
Minister. But neither was it the cockney style of the submerged
London masses. It was something in-between. And this was interest
ing, for he really had had only a little schooling.
He carried himself, too, with uncommon erectness. Clearly, he
thought well of himself. Yet when he set about getting a job in
Chatham, he made no pretense of seeking more than an ordinary
one. He was satisfied to start at something even lower than what
he had had in London and soon he was working as a handyman in
a grocery owned by one Andrew Crow, a crude, shantylike establish
ment of the kind one associates with a general store at some cross
roads in, say, Kansas, or in a mining camp in the Colorado territory
of that same period.
4
Chatham, Ontario, did in fact seem just then like a Western out
post, a settlement in a state of arrested erosion. Years before, it had
had a period of growth, even of excitement. It had been intended,
by its original settlers, as a shipbuilding center for a Canadian navy
because of its location on a river called the Thames. Hence its


THE BEGINNING
13
proud name, after the naval center on the Thames in England. But
nothing came of the shipbuilding idea. As stated in a town chronicle,
“Several gunboats were built, but it is questionable if they ever left
the stocks.” 2 In 1870, it was just a seamy settlement, quite as ordinary
as its newcomer.
Yet the town had been brushed by history. During the War of
1812, the battle in which Chief Tecumseh had been killed was
fought nearby. In this same war, a regiment composed largely of
Chathamites helped to capture Detroit. Some years later people
quipped that this was not the only time “Chatham captured Detroit.”
A second capture occurred, they said, when a man born in Chatham
and named Couzens became its mayor.
5
In the 1850% the organized Abolitionists in the United States
selected the town as the end of the line for the Underground Rail
road that helped slaves to freedom. In consequence, for a period,
Chatham's population was comprised more of blacks than of whites.
In search of material for Dred, her sequel to Uncle Tom's Cabin,
Harriet Beecher Stowe visited there.
In 1858, John Brown held a meeting in Chatham for the purpose
of organizing an armed invasion of the United States. Of course,
nothing came of Brown's “Chatham Plan,” and after the United
States had fought the Civil War, most of the Negroes left town. The
former Abolitionists ceased to visit Chatham—and also stopped
sending funds to help the colony of black freedmen there. Then
the town became as slow-paced and inconsequential as its meander
ing little Thames. When James Joseph Couzens settled there, it
had acquired a nickname: Mudtown.
A year later, young Mr. Couzens, now wearing a beard, sent for
the girl who had been waiting patiently in England for his summons
—and a passage ticket.
Emma Clift, of the other Chatham, was the daughter of Thomas
Cliff, who had served in the Crimean war as a member of a com
missary unit. After that war he had prospered moderately as a con
fectioner and may have sold some of his sweets to Charles Dickens,
then living in Chatham, England. The war service of Emma Clift's
father provided what was perhaps the one bit of “color” in the
Couzens-Clift family history up to then. Moreover, Florence Night-


14
THE MONEY-MAKING MACHINE
ingale had visited his regiment, led the soldiers in some singing,
and asked Tom Clift to stand with her on his trunk while doing
so. Emma’s father liked to talk of that incident, as did some of his
descendants.
Blue-eyed Emma Clift brought with her the “Nightingale trunk,”
when she made her own trip from Chatham, England, to Chatham,
Ontario, to marry James Joseph Couzens. 3
The couple set up housekeeping in a boxlike little brick “row-
house” in “the cheapest and muddiest district” of the town. There,
on August 26, 1872, a boy, blue-eyed and full-faced like Emma Clift
Couzens, was born to them.
One thing only seemed remarkable about the birth of the couple’s
first child. James Joseph Couzens, Junior (as the boy was christened
in the St. Andrews Presbyterian Church), was born with a caul, a
fact, according to the old folk legend, that foretold special good
fortune in life.
7
Young James grew up fully conscious of the supposed meaning
of his caul. It was often a topic of conversation in the family and
among the neighbors. His mother saved the caul, keeping it in a
little silk sack that she made for it, and parted with it only when
he married, presenting it to his bride, who also saved it. 4 After he
had reached maturity, he scoffed at the superstition—“That non
sense!”—concerning his caul. Yet almost from the beginning of
his life, his outlook toward the world, and his estimate of himself
and his destiny, may well have been influenced by the story.
It is certain that for a boy who grew up in the forlorn neighbor
hood of Elizabeth and Grand in Chatham, he carried himself as if
aware that a special destiny of fortune was his. Perhaps this was
something acquired in part from his father. But, if so, it was more
than just emulation. His pronounced assurance, apparent quite
early, that he was an especially favored child of fortune plainly was
one dominant factor that helped to make his later life so extra
ordinary, even startlingly so, in view of how and where it had begun.
But that was all in the future.
‘ That hot summer of 1872, when he was born, nobody in Chatham
would have wagered twopence that the new baby out on muddy
Grand Avenue would leave any special mark any place.


15
CHAPTER II
THE CANADIAN BOY
When the boy was four or five, his father became a laborer in the
soap factory of Lamont and Coate. He left the grocery trade because
in Canada it lacked dignity, he later said. However, his real reason
for the switch was the opportunity to earn a higher wage, which
in that era meant one dollar a day.
Yet the family managed—even with self-respect. Nothing was
wasted, ever. That this should be so was like a religion with James
Joseph and Emma Couzens. 1 So their style of living was pinchedly
narrow, but the boy developed into a sturdy, alert, good-looking
youngster.
Very early, James Joseph, Junior, showed some positive character
istics. About the time he was learning to talk, his mother one day
heard him making a great commotion in the backyard. Investigating,
she learned that all the noise was his way of registering protest against
a gust of wind that had blown down his alphabet blocks. 2
2
A few years more and he made a decision about his name. He
would not be known any longer as James Joseph Couzens, Junior.
He insisted on being known simply as James Couzens.
It was not in him then, or ever, to be a junior to anyone. In his
personal creed, indeed, this was to be a primary tenet—something to
be remembered for future reference. To be sure, this decision about
his name was a reflection of his attitude toward his father, an early
declaration of independence from him.
For such a declaration, the elder Couzens gave him sufficient
reasons. The townfolk considered his father a man who was amiable
and cheerful enough, although highly dogmatic on religious matters
pertaining to his Scotch Presbyterian affiliation. He was also known


i6
THE MONEY-MAKING MACHINE
as the “soul of deference” toward his wife, perhaps because she
“bowed to him in everything/* Yet toward his first son, the father
was strangely tyrannical and given to curious displays of the most
violent temper, slapping and whipping the boy frequently. His son
recalled later, “I have been panned ever since I was two years old.**
It was his father’s conduct toward him that he had in mind. 3
3
For such conduct on his father’s part, there seldom was any real
istic reason. For by no standard was the boy a delinquent. On the
contrary, he was respectful to a fault and almost always obeyed to
the letter any instructions given to him by either parent, even
though he once said that all his life he felt an “unjustifiable resistance
to people making me do things.” 4 He thought he kept this “resist
ance” concealed, but apparently not so well concealed that his father
did not suspect and resent this streak in him.
He was also tidier than most boys. He did willingly and well all
the household chores assigned to him. Even his father took pride
in “the punctiliousness” with which he performed the task of keep
ing the wood boxes clean. “He would pick out every piece of wood,
each shaving, every bit of bark—that’s the way he did everything,”
his father once said. 5
4
Yet there is the record—the angry beatings, slappings, and endless
emotional scolding from the dignified man whom the townfolk con
sidered so amiable and polite.
It is clear that there was involved here an unusually strong case
of tension between father and son. No doubt the elder Couzens never
understood the cause of his flare-ups (significantly confined to his
firstborn son). Nor was he able to restrain them. No doubt, too,
just as lacking in understanding about the anxiety produced in him
by his father, the boy often provoked the outbursts of “tyranny”
without realizing that he had done so. But whatever the cause, the
disturbance was certainly there, with all its consequent conflict.
Inevitably it was to produce a defensive as well as aggressive youth,
one destined to be in an almost constant state of resistance to most
forms of authority, real or fancied. This side of his nature once came
clearly into the open at school when, on very slight provocation, he
yanked at the beard of the principal, getting himself suspended


THE CANADIAN BOY 17
for the offense. He himself later said that he “guessed” he did that
because the principal’s beard represented “authority** to him. 6
Yet, significantly, during his youth, he never rebelled openly
against his father. Rather, he accepted, even courted, a great deal
more punishment from his father than was necessary. As a sister,
Alice, once recalled: “On many occasions, I tried to protect him
from punishment by denying that he had committed little mis
demeanors, such as running across the garden. But he would always
contradict me, and would have nothing but the truth—and take his
punishment.** 7
To Alice, these incidents denoted a penchant for telling the truth,
even if the truth hurt. This was true, for he certainly had a penchant
for truth-telling that hurt. But his sister’s comments also reflected
an aspect of his character that was more significant than his insistence
on telling the truth. This was a tendency to court conflict and also,
it seems, punishment, as if these were necessary to his existence.
As would be said of him later, “He seemed always to need to wear
the hair-shirt.” 8 If so, the reasons for this must remain obscure.
He himself often pondered his nature, but could not explain it.
Probably much of the answer would be found in his attitudes toward
his mother, as well as toward his father. But, except that he loved
her, little is known for certain of his feelings toward the mild-
mannered mother “who bowed in everything” to his father. He
talked freely about other members of his family. But he reminisced
very seldom of the blue-eyed Emma Couzens, his mother.


CHAPTER III
THE MONET-MAKING MACHINE, I
By the time young James was seven or eight, his father’s job at the
Lamont and Coate soap establishment had become twofold. He
manufactured the soap by the primitive, grimy process of steam
mixing wood ashes with discarded animal fats and he also acted as
salesman. Once in a while, young James went along with his father
on the selling expeditions. Chathamites remembered the sight. The
erect, clean-faced, good-looking little boy sat pridefully, they thought,
beside his bearded, incongruously dignified father on a one-horse
wagon, taking in with intent eyes his first impressions of the world
beyond the shabby area of Elizabeth and Grand streets.
On these trips, the boy naturally learned something about the
customs and ethics of commerce. One custom called for housewives
to save the wood ashes from their own stoves and fireplaces in order
to trade them for free bars of soap if other bars were purchased. Some
women tried thriftily to get more free bars than were coming to
them. Young James Couzens listened with sharp and alert interest
to the bargaining that resulted—his first bit of education on how
to become a businessman; and he noted especially his father’s satis
faction in not permitting a customer to get the better of him.
He learned also that people could be gullible. For example, some
of his father’s customers insisted upon buying the soap according to
brand names on the wrappers, preferring his “Electric” soap to his
“Gladstone” soap, or vice versa. They were sure the one was much
better than the other. But James knew that both brands came out
of the same odoriferous batch.
2
When the boy was nine, a great event happened to his father.
The elder Couzens became a soapmaker on his own, establishing
18


THE MONEY-MAKING MACHINE, I 19
the “Chatham Steam Soap Works, James J. Couzens, Prop.,” helped
in this by an inheritance of about fifteen hundred dollars that un
expectedly fell to his wife on the death of her father.
Young James was well aware of the marked elation his father
showed on becoming his own man, an independent entrepreneur,
no less, in the great world of commerce and industry, a world in
which the little “Chatham Steam Soap Works” was a substantial unit
—at least in the eyes of its “prop.”
Bearded James Joseph Couzens, Senior, the new independent
man, began to walk with greater dignity than before. But so also
did young James Couzens, sans the “Joseph” and sans also the
“Junior,” with ideas percolating in his well-shaped head, it may
be assumed, of one day also becoming an independent man and
heading some enterprise bigger and better even than his father's
“Chatham Steam Soap Works.”
This sudden economic rise in the world for the Couzenses of
Chatham was accompanied by an appropriate growth in the size
of the family. Two girls, Alice and Rosetta, were born. Later came
two more boys, first Albert, then Homer. The fact of their existence
naturally had an influence upon James, for a big-brother role now
fell to him. Looked up to by four awed youngsters, he was now of
lordlike stature in the family circle, his only rival for eminence
being his father. Boyhood friends recalled, “He carried himself like
a young lord.” 1
3
When this “young lord” was going on thirteen, the elder Couzens
became a dealer in coal and ice, along with soap. He also began to
manufacture cement paving blocks—some of which were still in
use in Chatham seventy years later. Indeed, James' father had in
fact become a real entrepreneur in Chatham, a status confirmed by
his election as an elder of St. Andrew's Presbyterian Church.
Quite early, James concluded that making money was synonymous
with growing into manhood, an idea that his parents and the general
cultural climate in Canada, as in the United States, encouraged. Be
fore he was nine, he was earning money on his own—ten cents a
week for pumping the organ at St. Andrew’s. When he wanted a
saddle for the horse that pulled the soap wagon, his father told him
to earn it. He should go out and sell soap, his father declared. This
he did. 2 When gas street-lamps were at last installed in the neighbor-


20
THE MONEY-MAKING MACHINE
hood, James scurried to get the job of lamp-tender. He obtained
the plum and was paid one dollar a month from the town treasury
for turning on four lamps each night and for keeping them clean. 3
Of him, a town chronicler wrote: ‘‘In school, if a football or baseball
were wanted, he organized the drive, persuaded the youngsters to
chip in their dimes, nickels, and cents, and he made the ultimate
thrifty dicker with the storekeeper." 4
4
His young mind obviously was much occupied with the power
that went with money. To impress his sisters and brothers, he did
an interesting and prophetic thing one day with his mother's “Night
ingale trunk." Secretly he placed some coins inside it, then called
the youngsters together, waved his hand, and cried, “Presto!"—
revealing the coins. The trunk, he announced grandiosely to the
astonished audience, had been converted by him into a “Money
making Machine." Its secret was known only to him. 5
5
He had, said his mother, “big dreams."
Once he scolded her quite earnestly because he had been born
in Canada: “I can never be King of England, but if I had been born
in the United States, I could be President." 6
From another boy such a remark might have been set down as idle
chatter. But his mother knew that he was serious.
She was often puzzled as to the source of such thoughts, and she
would become hurt when such things occurred as a neighbor com
plaining that James “deliberately snubbed" her daughter. The girl
had called hello to him from across the street, and he had ignored
her. But he had an explanation. “If a girl wishes to speak to me, she
should come across the street and do it properly." 7
One of his schoolmates recalled most vividly his conduct on the
day that the pupils of his school, Central, were invited to attend an
entertainment program at the McKeough School. “In came the
Central pupils with Jim Couzens in the lead, and he proceeded to
jump from one desk to another. His idea was to get for himself the
choice of seats—and he took the most direct way” 8
This, too, was prophecy.


THE MONEY-MAKING MACHINE, I
21
6
For a time, he worked in his father’s soap factory. But the smell
and mess of the place offended him. Then too, working there meant
working for his father, which he detested. Already he wanted to be
on his own—especially in relation to James Couzens, Senior.
One day, during the summer after he had completed primary
school, when he was only twelve, he saw a want ad for a book
keeper, placed in the local newspaper, the Chatham Planet, by a
flour mill. A job like that would get him out of the soap works.
So he applied for it, although, as he later admitted, he knew nothing
about keeping books. Incredibly, he was given the position.
His father was not at all happy over this development. There
was an emotional scene. But his father could give him no “good
reason” why he should stay at the soap works if he could land the
bookkeeping spot. So he took the job at the flour mill. He tackled
it as though he really were qualified, and soon announced that
bookkeeping was to be his career. Moreover, he said, he had no
intention of going on to high school. He didn’t need that—a waste
of time, he said. 9
But, as might have been expected, he was soon to sustain some
severe blows to his ego. One came when he lost the bookkeeping
job when his employers finally concluded that he was too young.
Then, after he decided to enter high school after all, he failed to pass
the entrance examination. His father was irate and heatedly ordered
him to get back to the soap works. The “punishment” proved a
spur for him to “bone up” for another try at the entrance examina
tion. This time he passed.
At high school he was more studious and tensely so than he had
ever been before. He spent less time than his fellows in idling with
other boys in Market Square. Instead, he put in more time with his
books. 10 He had not liked the taste of failure. It grated on his whole
being. He “swore that it would never happen to him again.” 11
In his mind, too, was an anxious need for erasing the stigma he felt
was attached to his failure on the bookkeeping job. So, after two years
at the high school, he enrolled for a two-year course in bookkeeping
at the Canada Business College in Chatham, to be properly prepared
for “the next time.” To pay his way while at this “college,” he worked
as a newsbutcher on the Erie and Huron. The railroad “never had a
better one,” recalled his superior, Bill Turtle. He was, said Turtle, a
“hustler.” 12


22
THE MONEY-MAKING MACHINE
7
It was inconceivable that such a “hustler/’ a youth whose anxious
need for success gave him no rest, would long remain in the little
town of Chatham.
He was bound to feel the lure of some bigger place—London, in
Ontario; or Montreal, in Quebec; or even Detroit, only fifty miles
away from Chatham. And just as inevitably, in view of his relation
ship with his father, he was destined to leave home as soon as he
could. Only then could he—or his father and mother—have any real
peace in the household: this was understood, though never expressed
in so many words, by all three of them.
8
In 1889, when James Couzens was seventeen, a friend named Dick
son went to Detroit, obtained a job with the Michigan Central Rail
road, and wrote back that another job was to be had there. Young
Couzens hurriedly packed up, and left at once to get it. But some
thing went wrong. In a short time he found himself, unhappily, back
home again.
A few months later—it was then 1890—he set off for Detroit again,
and this time he stayed. On August 9, 1890, just as he was turning
eighteen, he was hired as a car-checker by the Michigan Central in
Detroit.
On the railroad his wage was forty dollars a month for a twelve-
hour shift, seven days a week, and yet he was delighted. It was, he re
called, “great stuff” to be checking freight cars, even in weather so
cold that the tacks which he carried in his mouth for affixing labels on
the cars literally froze to his tongue. After each shift, he went to his
room, in a place called the Amos House, feeling that he was “running
the railroad.” 13 Only when he had that kind of feeling was he ever
content.
Most of all, however, he enjoyed the status of being on his own at
last.


23
CHAPTER IV
THE NEW DETROITER
The place called the Amos House was a ramshackle, weather-beaten
lodging and boarding place, favored by railroad workers employed
at the "Junction Yards." Then, though not later, it was on the out
skirts of Detroit. Its main attraction: low-priced meals. For the next
three years, young James Couzens lived there, his steel-blue eyes more
intently than ever focused on his goal: success.
It was noticeable that he did not mix much with the other Amos
House boarders. He stayed out of their bull sessions and only rarely
joined in the beer drinking that went on. Nearly everyone else there
was called by some nickname. But riot Couzens. His deadly serious
manner about almost everything discouraged such familiarity.
He did make some friends. But these had to overlook or discount
a “don’t-tread-on-me” attitude that often became quite explosive. It
was accepted, or at least expected, that if one made a remark that
young Couzens disliked, or with which he simply disagreed, he would
blurt out a stinging comment or retort. This seemed almost an in
stinct with him.
In appearance alone, he stood out from most of his fellow railroad
workers. Even in his work clothes, he had a buttoned-up look. In
stead of a car-checker, he could have been taken for an English bank
clerk or even a divinity student, especially after he began to wear
thin-rimmed spectacles.
From his always impeccable clothes to his neatly clipped, carefully
brushed, blond hair, everything about him except his temper pro
claimed disciplined orderliness, precision, and restrained tension.
And always, in the taut mold of his forceful, open face, there was a
warning that here was a man who spoke his mind.


*4
THE MONEY-MAKING MACHINE
2
By then, he had become a clean-cut youth of exceptional handsome
ness. He was, indeed, a perfect specimen of the Anglo-Saxon type—
fair, well-built, with finely chiseled features. That girls would be
interested in the young transplanted Canadian, if he gave them half
a chance, could have been assumed. In Chatham, he had had one or
two friendships with girls, but none that were “serious,” no doubt
because of his “don’t-tread-on-me” attitude. In Detroit, he was in no
greater hurry to make any such alliance. He was not, however, al
together aloof in this matter. He did have a number of casual dates.
Some Saturday nights, he even unloosened the buttoned-up look
enough to attend the public dances at the Detroit Armory. On one
trip back to Chatham to see his family, he boasted to his brother
Homer: “I have so many girls in Detroit that I can take out a differ
ent one every night and not get back to the first one for two weeks.”
But the brother gathered that this was mainly a boast. 1 Actually, his
major concern was getting on at the Michigan Central, keeping his
eyes open for all possible promotions.
5
He had come to Detroit at the proper time. In 1890, this city of
two hundred thousand was already on the threshold of its destiny.
Men in and near Detroit, at precisely this time, were beginning to
conceive, and even to make, something that was to propel Detroit,
in a span of ten years, to undreamed-of heights of activity and wealth:
the horseless carriage. By 1890, young Ransom E. Olds was working
at Lansing, Michigan, on just such a contraption, to be propelled
by steam. In this same year, on a farm at Dearborn, near Detroit,
another man, Henry Ford, was perfecting a two-cylinder gas engine,
fascinated with the idea of applying mechanical power to farm
chores. 2
Not yet, to be sure, was the Detroit of the 1890’s (more grim than
gay) entitled to its later favorite nickname: “Dynamic City.” On the
contrary, in contrast to other cities of similar size, Detroit then
seemed the opposite of dynamic. It was extraordinarily backward in
(of all things) public transportation. After other American communi
ties had been using electric trolleys for years, Detroit’s streetcars were
still horse-drawn.
Car-checker James Couzens had to walk three miles over dusty or


THE NEW DETROITER
*5
muddy unpaved streets from the Michigan Central yards to the near
est car lines. He was indignant about this—a fact to be remembered.
However, many of those factors destined to make Detroit truly
dynamic were already present. It was a city of marked manufactur
ing ability. Its location on the river connecting it with the Great
Lakes made the shipment of products and raw materials easy and
profitable. Its stoves, railroad cars, wheels, seeds, cigars, and other
manufactured items were known around the world. The Detroit
River was already alive with freighters, barges, and steamers.
4
Hazen S. Pingree, a well-to-do, successful, and ebullient manufac
turer of shoes, was elected mayor of Detroit the very year young
Couzens became a Detroiter. Later this fact would be of special and
intriguing interest in respect to Couzens. For, although a wealthy
industrialist and also a Republican (in the same ranks as William
McKinley and Mark Hanna), this pugnacious Mr. Pingree conducted
himself in such a manner that he was scorned by his fellow industrial
ists as a “socialist.” Indeed, it was in this same year that Pingree, at
times battling “special interests” alongside such progressives as Gov
ernor John Peter Altgeld, Illinois’ “Eagle Forgotten,” launched the
stormy Detroit and Michigan political career that would be credited
by one Michigan historian with helping to “lay the basis for the lib
eral movement in the Republican party which was carried forward
more successfully by some of his successors,” 8 —including one succes
sor named Couzens.
Pingree had burst upon the Detroit political scene just then as a
“People’s Mayor,” denouncing tax-dodging corporations and fighting
especially for improved public-utility service and lower rates for such
service. Critics said he was “utterly lacking in tact and diplomatic
gifts.” 4 Nevertheless he became one of the two outstanding mayors
in Detroit history.
Worth recalling is the fact that in 1890 Pingree started a movement
for municipal ownership of public transportation, for which action
he suffered social ostracism from his clubs and his church. During the
panic of ’93, Pingree increased the conviction of other businessmen
that he was a socialist, or another kind of radical, by his insistence
that unemployment relief was a function of government. He arbi
trarily allowed unemployed laborers to take over vacant lots for rais
ing food, mainly potatoes, and “Pingree’s Potato Patches” became a


26
THE MONEY-MAKING MACHINE
national phrase, along with “Coxey’s Army”—fighting words in the
ideological disputes of that day.
5
The furor stirred up by Pingree’s "‘radical” ideas, and especially the
heated denunciation of them by leaders of his own party, made a
strong and lasting impression upon young Couzens. What’s more,
even in the 1890’s, though more from temperament than from any
studied conclusions, Couzens harbored certain inchoate Pingree-like
ideas of his own.
For example, he barked some uncomplimentary remarks to fellow
railroaders about the low wages paid to stevedores on the river-front.
And he stopped to listen when Single-Tax orators lectured groups of
workingmen on Woodward Avenue. Later, he called himself a Single
Taxer—“in principle.” 5 During a streetcar strike in 1891, a stormy
episode linked with Pingree’s municipal-ownership program, he
sympathized impulsively with a group of strikers he saw tossing
bricks at a streetcar. Young Couzens hurled a few bricks himself.
In 1894 there occurred a national railroad strike, the one that
resulted from conflict between Eugene V. Debs* “one big union”
and the Pullman Sleeping Car Company. This brought the “social
conflict,” as editorialists then described labor-capital tension, quite
close to Couzens of the Michigan Central R.R. Company, in the
“Junction Yards.”
He was not at all taken in by the overheated propaganda that
pictured the Pullman workers and their striking railroad-worker
sympathizers under mild-mannered Debs as “anarchists,” “com
munists,” or some other brand of revolutionists bent upon destroy
ing America. Nor was he taken in by the same kind of clamor that
churned around Altgeld in Illinois for protesting on constitutional
grounds President Grover Cleveland’s use of federal troops to break
the strike—a clamor that soon also churned in Detroit around Mayor
Pingree, who supported Governor Altgeld. Young Couzens assessed
the outcries of “anarchy” for what they were. Remembering his own
slim pay-envelope at the Michigan Central, he made up his mind that
the strikers were just railroad men, like himself and his fellows,
who merely wanted what he also wanted—somewhat fatter pay
envelopes.
His unit of the railroad escaped direct involvement in the Pull
man strike. But, in his talks with others at the yards, he did not make


THE NEW DETROITER
27
it a secret that his sympathies were with Debs’ men. He was aware
that if his attitude were “reported” it might cost his job, but his
feeling was: If he thought so, why shouldn’t he say so? Nobody was
going to take that right from him. 6 This attitude he never changed.
6
Actually, he was neutral on the “union question,” so far as he
himself was concerned, for he was sure that the state of being a
“worker” was only temporary for him. So the union question as
such was not really a personal matter with James Couzens. Although
at times he growled about the Michigan Central that “this road
doesn’t appreciate what we workers do,” he worked faithfully for
the railroad. And he worked superlatively well. “He was always
on the job, worked his head off, never did any fooling around,” a
fellow worker at the railroad recalled. 7
True, his record at the railroad was marred by a “letter of rep
rimand” on July 20, 1891. This made him “sore as Hell”—and the
roar of angry protest that broke from him that day was considered
memorable at the “Junction Yards.” The fault, he felt, belonged
to a fellow worker for having failed to awaken him, as he had re
quested, when he was taking a nap toward the end of a long shift.
But there was no other black mark against him. 8 “I was,” he boasted
in after years, “the best God-damned car-checker on the line!” 9
7
As if to point up the fact that he was a “man,” after he became
twenty-one in 1893, he went to his superintendent and asked for
promotion. The job he wanted was that of boss of the freight office
in the yards.
Before long the position was his, although this meant passing over
a number of men who had been car-checkers long before he had
begun working for the railroad. For the first time, he now had the
responsibility of directing the work of other men, including some
much older than he. He had no lack of assurance in the way he as
sumed that responsibility. He was not a popular boss and made no
effort to be popular. Already he was a strict disciplinarian. Yet,
though he did not win affection, he did win respect. “He never tried
to shift responsibility upon others to shield himself; if he made a
mistake, he would own up regardless of what the result might be,”
one of his men recalled. 10


THE MONEY-MAKING MACHINE
$8
Nor did he pick on subordinates while kowtowing to superiors.
“He was just as assertive with those above him.” A superintendent,
one Buchanan, once gave him a “calling down.” Couzens talked
back.
“You're fired!” said Buchanan.
“You can't fire me!” retorted Couzens.
He wasn't fired. 11
8
At the freight office, for the first time he came into contact with
patrons of the railroad, something he had in mind when he asked
for the promotion. For he had concluded that it would take too
long to realize his ambitions if he stayed in the railroad business.
He hoped to get into something with a better and quicker future
by meeting the businessmen who used the railroad.
Yet, of all the clerks in the freight office, he was most notorious
for treating patrons “rough,” especially when it fell to him to advise
them about demurrage charges, a new tariff which had just been
established by the Michigan Central and which was bitterly resented
by most of the patrons. “The way Jim Couzens talked with these
patrons on the telephone, giving them holy hell, was just astounding,”
recalled an associate at the freight house. 12
With Alex Y. Malcomson, a coal dealer, he had had some of his
more heroic rows over demurrage charges. But rather than resenting
Couzens' blistering way of laying down the law to him, Malcomson
admired it. Malcomson obviously concluded that here was an em
ployee who really looked after an employer’s interests. To the
amazement of nearly everyone, Malcomson one day offered a job
to Couzens.
In October 1895 Couzens went to work for the Malcomson Fuel
Company as assistant bookkeeper, private car-checker, and all-around
general factotum, for which he was to receive seventy-five dollars
a month. 13


29
CHAPTER V
THE COAL CLERK
In 1895, Alex Y. Malcomson was a restless, energetic Scot with a
lean, though well-built, body and a long nose framed by mutton-
chop whiskers that gave him the look 01 a successful merchant going
full-steam ahead. And this was true—fortunately true, in a material
sense, for the new office factotum, James Couzens.
Because of what the future then had in store, Malcomson was a
figure who deserves to be remembered in the history of Detroit, for
his own major role as well as for his influence upon the careers of
some important and better-known Detroiters. Yet, curiously, so in
dustrious a gatherer of facts as John Gunther, in 1947, wrote in his
book Inside U.S.A.: “I would like very much to know what happened
to a man named Alex Y. Malcomson. ... It seems that he was a
coal dealer, and Couzens was a clerk in his office. ... I was unable
to find anybody in Detroit who knew . . . about Mr. Malcomson.” 1
In 1895, however, and for at least two decades afterwards, few
Detroit businessmen were much better known in the city's com
mercial circles. 2
2
Malcomson in the lSgo’s typified in many respects the enterpris
ing American businessman more accurately than the Goulds, Wana-
makers, or Vanderbilts. Lacking their capital, he, too, as one of
his sons recalled, was “the plunger type, a man who did not hesitate
to take chances." And he was constantly looking for chances to
take. 3 Starting with a small grocery in Detroit, he switched to coal,
soon bought out several competitors, merged them into his business,
and laid plans to make his mark in higher reaches of Detroit
business.
About two years before Couzens went to work for him, Malcomson,
during a coal strike, had staged a business coup that was the talk


30
THE MONEY-MAKING MACHINE
of the trade. Most other dealers had no coal to sell and he had very
little. But he learned that the Detroit gas company had a surplus
and arranged to distribute the gas company’s coal to consumers, on
commission, at somewhat inflated prices. “He made a handsome
profit,” admiringly reported the Detroit Free Press a little later in
a “puff piece” on Malcomson. 4
3
Between Couzens and Malcomson there developed something
more than an ordinary relationship. They were in emotional ways
like father and son. At times, this was uncomfortable for Couzens,
as well as for Malcomson, since it turned out that Malcomson had
certain character traits that were strikingly similar to those of
Couzens’ own father. “He had a fiery temper and would blow up
fiercely when anyone did something he considered wrong or stupid.” 5
So one of Malcomson’s sons recalled.
Couzens was often on the receiving end of Malcomson’s out
bursts. Once Malcomson called him a liar. Red-necked, then red
faced, Couzens flung his office keys at Malcomson and announced that
he had “quit.” Not until Malcomson had humbled himself by send
ing him a note asking him to return, did Couzens go back. 6
There were other such incidents, enough to justify the comment,
“How Malcomson and Couzens managed to remain affiliated is one
of the mysteries of destiny.” 7
But they did remain together at the coal company for nearly
eight years.
It could not have escaped Malcomson, who seemed himself to
receive more gratification from the “game” of business than from
the monetary rewards, that in trim, bespectacled James Couzens he
had an employe who really did not work for pay, but from the love
of work. He had what to any employer would have been a “find,”
what some would call a “jewel,” a man to be kept at almost any
cost.
True, young James Couzens, his eyes still firmly set on his old
goal, one measured by monetary rewards, wanted what compensa
tion was coming to him. It is also true that he intended to ask for
and to get much more than he was then making. But it was clear
that this transplanted Canadian, so fully trained in the philosophy
of work by his Chatham parents, did his work because work was then
his basic philosophy. And Malcomson, of course, liked that.


31
CHAPTER VI
THE FAMILY MAN
Even before leaving the Michigan Central, Couzens had found the
girl he had been looking for. She was Margaret Manning, a widow's
daughter, from a family fairly well known in Detroit. Her uncle
was Aaron A. Parker, a banker and head of the White Star shipping
line, which operated ships on the Great Lakes from Detroit. A
nephew of hers, John C. Manning, later became one of the city's
best-known newspapermen, the editor of the Detroit Times.
A good-looking young woman, possessed of a lively nature, Marga
ret Manning also had a practical outlook on life that suggested
strength of character. Thus, this blue-eyed Margaret was good com
pany, without being giddy—the only kind of girl in whom young
Couzens, so serious for all his handsome appearance, could possibly
have become interested. Probably more than he realized, she re
minded him of his own mother, both physically and because of her
serene manner—a factor that undoubtedly drew him strongly to her.
They had met through another girl, Margaret's cousin, whom he
had been squiring casually on his days off. But soon after meeting
Margaret, he stopped seeing her cousin. His bicycle, a prized new
possession, began to be parked in front of the Manning residence
with noticeable regularity. 1
2
Not long afterward, he took a room in Margaret's home, for her
mother had adopted the custom followed then by many families of
renting extra rooms in their oversized houses to “suitable persons."
Young Mr. Couzens certainly was recommended by Margaret as
“suitable."
He began taking Margaret bicycling on Belle Isle—the way many
romances started in the Detroit of that day. Sometimes wearing a


32
THE MONEY-MAKING MACHINE
derby, sometimes a cap, he talked to her earnestly of his hopes for
rising in the world. He found Margaret a good, as well as a willing,
listener. A few more months and it was understood that Mrs. Man
ning’s lodger was Margaret’s “young man.” Finally, one afternoon in
the winter of 1897, on the last visit of the season to Belle Isle, he
proposed to her. As he expected, Margaret said yes. 2
3
There was one problem: the Mannings were devout Roman
Catholics. Actually, so far as Couzens was concerned, this was only
an opportunity that he welcomed to deliver to his father another
and quite final declaration of independence. For, although his mother
accepted the religious situation calmly, his father, the Presbyterian
elder in Chatham, was horrified by the idea that his son intended
to marry a “Papist.” He said he would never permit it. But Couzens
firmly and coldly replied that he intended to go ahead with the
marriage.
As for Margaret and her family, they, too, had a similar religious
problem. For Couzens, although not a churchgoer (too much of that
in Chatham, under the lash of his father, had cured him, he once
said), had no intention of embracing Catholicism.
Bishop John F. Foley of the Catholic diocese of Detroit was a
friend of the Manning family. He was consulted and suggested that
Margaret’s “Presbyterian young man” call on him. “The Bishop
took a liking to him, and gave his approval to the marriage,” 3 with
Couzens agreeing, of course, that any children of the marriage were
to be brought up in the faith of the Roman Catholic Church.
On August 31, 1898, when Couzens had just turned twenty-six,
Bishop Foley celebrated the marriage sacrament at the Manning
home.
They took the conventional trip to Niagara Falls for their honey
moon, after which they made their home with Margaret’s mother.
Couzens did not like staying on at the Manning home. But his
income, still seventy-five dollars a month, made it the prudent thing
to do. However, in agreeing to stay, he made a family rule: Margaret,
for her part, had to agree that they would live within his income,
no matter what it was. She was not to receive any money from her
family. “He simply would not stand for it.” *


THE FAMILY MAN
33
4
A few months before his marriage he had gone to the federal
building in downtown Detroit to attend to another matter of personal
importance. This was to give up his status as a subject of Great
Britain, by renouncing his allegiance to Queen Victoria, to become
a naturalized citizen of the United States. He had intended to do
this for some time, for he clearly never considered going back to
Canada to live.
5
The War with Spain was then on. Though a puny affair, it none
theless was a shot in the arm for business generally. The new pros
perity directly affected Couzens, for in one of his periodic spurts
of optimism, this time produced by the war activity, Malcomson
had acquired a coal business in Toledo, the Crescent Fuel Company.
Deciding that Couzens should be his manager in Toledo, he sent
him there and raised his pay to one hundred dollars a month. For
Couzens, this change held the promise of prosperity and even of
some independence. But the bright prospect soon was overshadowed.
Margaret became ill shortly after they had established themselves
in Toledo, and Couzens was forced to ask Malcomson to let him
resume the old job in Detroit so Margaret could be near her mother.
Again they went to live with Mrs. Manning.
Then came a sadder occurrence. As part of their preparation for
a child, they had arranged for a home of their own, renting, at
twenty-one dollars a month, a “terrace’* on West Grand Boulevard,
just off Fourteenth Avenue. The child, a son, was born in the spring
of 1899, but it died almost at once.
In the following year, Margaret gave birth to a second child,
another boy, who turned out to be an extraordinarily healthy, bright
youngster. They called him Homer. Then began for Couzens “the
happiest period” of his life, as he himself described it. He became,
in fact, almost a different man—at home. Whereas, to the outside
world, he still displayed, like a trade-mark, his don*t-tread-on-me
manner, at home he relaxed almost completely, romped with the
boy, and enjoyed being called “Daddy Jim.** 5
Margaret Couzens proved a perfect companion for him. He seemed,
literally, to worship her. 6 With her he was the soul of affability and
deference, just as his father had been to his mother. With nearly


34
THE MONEY-MAKING MACHINE
everyone else he still, constantly, asserted his spirit of belligerent
independence. “He had a direct, blunt way of speaking to fellow
employees and to customers. He expected to be obeyed without
any question,” said a stenographer at the Malcomson Fuel Com
pany. 7 He was not much different in that job than he had been at
the Michigan Central before his marriage, when “no one could tell
him what to do.” But he actually encouraged Mrs. Couzens to boss
him, something that would have amazed his old railroad co-workers.
He appeared to derive a kind of serenity from being bossed by
Margaret. She even communicated to him, when she was with him,
some of her own serenity. He was, recalled an intimate, “The per
fect family man.” 8
6
In 1902 another son, Frank, was born. By then, he was much more
than just a clerk at Malcomson’s. Though without the title, he was
really the manager, as everyone understood. Despite all his single-
minded devotion to work, however, his income was then only
eighteen hundred dollars a year. This was neither enough for his
family’s needs nor for his ego. The turn of the century seemed a
time of prosperity for the nation generally, but little of it had
drifted his way. Detroit was growing. Skyscrapers were going up.
A new, although still quite infant industry, automobile manufactur
ing, had developed. Yet he seemed to be standing still. He con
sidered taking up law and began reading law books at night. A
lawyer’s career appealed to him as one way of increasing his earn
ing capacity, and also of meeting his greatest need—to be on his
own. 9


35
CHAPTER VII
THE FORD MOTOR COMPANY
Similarly driven by ambition, Malcomson also was restless. He
had lately invested some money in an icebox scheme, only to suffer
a failure that cost him several thousand dollars. Couzens lost in
the venture too, having put in $100.
In 1902 Malcomson eyed a new business, in connection with which
he was seeing much of the spare, angular man named Henry Ford.
Malcomson had known Ford from the days when Ford had been
employed as an engineer by the Detroit electric light company and
had bought coal for the light company from Malcomson. After re
signing that job in 1899, Ford continued to buy coal from Malcom
son for his home.
By 1902 Ford had already been in and out of two automobile
ventures. His first was the Detroit Automobile Company, formed
by a group of Detroit businessmen to produce automobiles from
a model that Ford had developed. Later Ford referred to his backers
in this company as “a group of men of speculative turn of mind,”
whose “main idea seemed to be to get the money.” 1 They had an
agreement with him to build at least ten automobiles on a budget
of $10,000, yet this sum “didn't pay for one.” 2
The main trouble apparently was that Ford was “a perfectionist.”
He could not bring himself to the point of letting the company go
into production, for he kept wanting to make changes. 3 An illustra
tion of this trait of Ford’s occurred when Henry B. Joy, who later
formed the Packard Motor Company, wanted to buy a car and was
discouraged from doing so by Ford himself, who said his car was not
yet good enough. Little wonder that the “men of speculative turn
of mind” became impatient. They gave Ford, as it was put, “an op
portunity to resign.” 4 As some of these men went on to form the


THE MONEY-MAKING MACHINE
36
company which became the Cadillac Motor Company, the first
Cadillac was, in a sense, really a Ford. 5
In November 1901 the Henry Ford Company was incorporated,
organized around still another car designed by Ford and including
some of the men who had been in the Detroit Automobile Com
pany. A company which most histories of Ford ignore, the Henry
Ford Company apparently turned out only one or two racing ma
chines; then, as stated in a newspaper article, it died of inanition.®
So in 1902 Ford was at loose ends, but still hopeful. He had won
some fame as an automobile racer. But many called him a “nut,”
while some persons derided him as “Crazy Ford.” 7
Malcomson had about the same esteem for Ford the man as other
businessmen in Detroit at this time—that is to say, he did not esteem
him highly. The general attitude can be illustrated by an incident
which occurred when Ford was working on his first car. He had
to buy parts from Strelinger’s hardware store, where his credit was
strictly limited to fifteen dollars. He wanted to make a larger pur
chase. “Fifteen is the limit,” the storekeeper said. 8
But Malcomson had made some careful inquiries about the kind
of automobile Ford had designed, a runabout with an opposed-type
two-cylinder motor in the rear. What he learned impressed him.
He began thinking about financing Ford’s car. Ford was more than
willing. After many cautious talks, Malcomson decided in August
1902 to give Ford a third whirl at the automobile “game.” But it
was Malcomson’s idea to “promote” Ford’s car by himself—no other
financial backers were to be in the scheme—and this appealed to
Ford.
Ford had calculated that it would take $3,000 for him to complete
a new model. Malcomson agreed to put up this amount, and also to
arrange for any further financing that might be necessary. Malcom
son was to have a half interest in the car, and he and Ford “were to
share the emoluments and the profits of their joint venture equally.”
There was to be no “Ford Motor Company”—only a Malcomson-
Ford partnership.®
That was the way the agreement was drawn up on the hot Saturday
afternoon of August 16, 1902, in the law offices of John Wendell
Anderson and Horace Rackham, two young members of the Detroit
Bar whose main client was Malcomson’s coal company, for which
they handled, principally, the “bad accounts.” 10


THE FORD MOTOR COMPANY
37
2
And what about Malcomson’s chief clerk? Couzens did not share
his employer’s enthusiasm for automobiles. Several times he had
noticed Ford, then wearing a mustache, in the Malcomson office, and
he knew that Ford was a customer. But he paid very little attention
to him, not finding him then a man worth much attention. Back
about 1892, when Couzens was still living at the Amos House, his
path had crossed Ford’s, for Couzens used to visit the gym of the
Railroad Y.M.C.A. and, for a time, Ford taught a class in mechanics
there to earn some extra money. 3 * * * * * * * 11 It is certain that Couzens would
have paid no attention to Ford’s class at the “Y,” for he had not the
slightest mechanical bent. “Malcomson used to take me out in his
car sometimes and frequently he turned something on the dash
board, explaining to me that he was changing the mixture,” he once
said. “I thought that he meant he was mixing water with the gasoline,
and I continued to think so for a long time.” 12
But Couzens was greatly interested in Malcomson’s new plans.
They were bound to affect him, for he understood that Malcomson
was prepared to pledge all his credit to get this automobile venture
going. And if the automobile business failed, the coal business would
go under too. But if the automobile venture succeeded, Couzens
might find himself running the coal company, for Malcomson had
already hinted that he planned to devote nearly all his time to the
exciting new business. He had told Couzens that he would give him
more responsibility at the coal office, a raise in pay, and a bonus of
$1,000, if the coal office did a business of a certain amount in the
next twelve months. 13
3
There was another factor that brought Couzens directly into the
picture. Malcomson wanted his dealings with Ford kept secret. He
was afraid his credit with the banks would be injured if it were
publicly known that he was backing anything “so risky” as an auto
mobile venture. 14
So Malcomson’s money for the Ford project was placed in a bank
in Couzens’ name.
Malcomson also assigned to Couzens the duty of “checking up”
on Ford’s expenditures. “As Ford’s bills piled up and finally went
over the $3,000 limit, I warned Malcomson many a time,” 15 he said.


THE MONEY-MAKING MACHINE
38
Before long, Couzens was so much a part of the project that Malcom
son brought him into most of the negotiations for getting cars pro
duced.
He was no passive onlooker. This came out explosively at a meet
ing with John and Horace Dodge. These brothers, later to be famous
as motorcar makers in their own right, owned a machine shop and
were brought in to make the chassis for the Ford cars, as they already
were doing for Ransom E. Olds. 16 At a session with Malcomson,
Ford, and Couzens, John Dodge asked for certain provisions in the
contemplated contract.
“I won’t stand for that!” Couzens declared.
Not many persons had ever dared to talk that bluntly to muscular,
brusque John Dodge.
“Who in hell are you?” demanded Dodge.
“That’s all right,” Malcomson said, “Couzens is my adviser in
this.” 17
4
When finally signed, the contract called for the Dodge brothers
to produce, within a year, 650 chassis at $250 each—a commitment,
in this one instance, of $162,500. Other parts, such as bodies, wheels,
and tires, plus costs for promotion, brought the total of Malcomson’s
obligations to about $350,ooo. 18
No such sum was in Malcomson’s possession. He even lacked, in
ready cash, the $10,000 which he had agreed to pay the Dodges, on
account, once they started actual production.
Malcomson counted on “a perfect craze” for automobiles on the
part of the public to carry him through safely. 19 He expected to sell
the completed cars as soon as they were assembled, and then pay
off his suppliers out of sales. He determined—a crucial decision—
that a factory would not be needed, only a place for assembling the
various parts, work for which even a barn would do. Everything
would be made outside the assembly plant. Thus no investment in
machinery would be required. By selling the cars for $850 (the price
of the Cadillac) he figured on a profit of at least $95,000 on the first
lot. 20
On paper Malcomson’s optimism seemed wholly justified. Soon,
however, trouble developed. Couzens advised him that “Ford’s bills”
totaled $7,000, or $4,000 above the agreed limit. Then the Dodge
brothers began demanding the $10,000 payment. Malcomson suc
ceeded in stalling them for a time. But as the Dodge brothers grew


THE FORD MOTOR COMPANY
39
more insistent, Malcomson decided to trim his sails somewhat. In
November 1902 he moved to enlist some outside financial support
after all. His plan was to sell some shares in his half of the partner
ship. He had new articles of partnership drawn up; these provided
for a company to be called ‘‘The Malcomson-Ford Company, Ltd.” 21
“But everybody shied off from his stock,” so Couzens said later, 22
and the original precarious arrangement had to stand—at least for
a while.
5
In February 1903 Malcomson persuaded the Dodges to wait for
their $10,000 until they had delivered some chassis. He boldly in
serted large advertisements in trade papers concerning what he called
“The Fordmobile,” advertisements signed “The Fordmobile Com
pany, Ltd.” There was no such car and no such company. Both were
merely reflections of Malcomson’s desperate hope that this advertis
ing would bring some advance orders for the car—and perhaps some
cash in advance. 23
He did get orders—but no cash.
As the date neared for the Dodge brothers to deliver the first
chassis, Malcomson lost some of his nerve. He talked with the owners
of the Daisy Air Rifle Company about having them take over his
commitments, with the view of making the Ford car in their air-rifle
plant at Plymouth, Michigan. He offered to give them half his
interest.
There was some earnest talk of the car being called “The Daisy.”
But Ford objected and told Malcomson his car had to be called a
“Ford.” The plan fell through anyway, when the Daisy people de
cided against taking the chance. The whole business of making auto
mobiles seemed too risky. Besides, one of the air-rifle company
principals was interested in putting money in some land in one of
the Southern states. Mississippi land seemed to him a much better
bet than the Ford-Malcomson automobile deal. 24
Then the Dodges issued an ultimatum. If Malcomson could not
live up to his contract with them, they would produce and market
the car themselves. 25
Facing this threat, Malcomson decided he had to abandon the
partnership idea entirely. He would have to make a clean breast of
things to his bankers and organize a stock company after all. He
called on John S. Gray, president of the German-American Bank of
Detroit, who was related to him and whose bank did most of Malcom-


40
THE MONEY-MAKING MACHINE
son’s coal-business financing. Malcomson wanted two things from
banker Gray. He wanted money—enough to pay the Dodge brothers
—and he wanted Gray himself to join the company, for he believed
that Gray’s name would serve to attract other investors.
6
John Gray was aghast. Only a short time before, Malcomson had
obtained considerable credit from Gray’s bank for another merger,
consolidation of the Malcomson Fuel Company with Jewett, Bigelow
and Brooks. 26 Gray now suspected that he had cause to be worried
about that loan.
“I want you to go out to the Dodge place this afternoon and see
what is being done,” Malcomson urged.
Gray went, but when Malcomson urged him to join in the venture,
the banker refused. 27 “Invest in a horseless carriage?” he snorted.
“Asinine folly!” Now it was Malcomson who seemed “crazy.”
“Put up some money and I’ll guarantee it to you any time within
a year,” Malcomson said.
“You mean if I am dissatisfied, at any time, I can call on you for
the money?” Gray asked.
“Yes,” said Malcomson. 28
Under this arrangement, what did Gray have to lose? He agreed
to put up $10,000 personally, but he still had profound misgivings
despite Malcomson’s “guarantee,” never dreaming that what would
later be known as “the fabulous Gray estate” was being founded
by him that day.
7
On the strength of Gray’s interest, Albert Strelow, who ran a
carpenter shop, was persuaded by Malcomson to put up $5,000, and
also to provide the shack in which the automobiles were to be as
sembled. Vernon Fry, a dry-goods merchant whom Malcomson knew
as a fellow church member, was taken for a ride in Ford’s runabout
in an effort to interest him. He “was scared to death,” but finally
told Malcomson to put him down for $5,000 too. Charles T. Bennett
of the Daisy Air Rifle Company then agreed to invest $5,000 as a
personal matter, and the two lawyers, Anderson and Rackham,
agreed to pledge $5,000 each.
To get his $5,000, young Anderson, who had studied at Cornell
and graduated from the University of Michigan Law School—a
spare, well-dressed barrister who parted his hair stylishly in the


THE FORD MOTOR COMPANY
41
middle—wrote a glowing letter to his father, a physician in LaCrosse,
Wisconsin. Dr. Wendell Anderson was “somewhat skeptical.” But
having a strong affection for his lawyer-son, he could not bear to
turn down the touch. 29 Rackham, who always looked like something
of a farmer, raised his $5,000 by selling a piece of Detroit land he
had acquired. “What finally decided me,” Rackham recalled, “was
a bundle of letters, most of them bona fide orders for cars, which
Malcomson and Couzens showed me.” 30 C. J. Woodall, a junior
clerk at Malcomson’s, put up $1,000. And the Dodges finally said
that, in lieu of the $10,000 owed them, they would take $10,000
worth of shares. 31
8
And Couzens? In his and Margaret’s bank account, he had just
$400.
He told John Anderson that he intended to “beg, borrow, or
steal” all the money he could, to be well represented in the venture. 32
But from whom?
His wife’s mother had a nest egg of $15,000. He talked with her
about a loan of a size that would have made him one of the biggest
investors of all. There was a family meeting on the question. Mrs.
Manning hesitated, for she recalled “Jim’s icebox failure,” the
venture with Malcomson.
In the end, however, she agreed to a loan of some figure, but
suddenly, at that moment, he decided that he could not bring himself
to borrow from his mother-in-law after all. He simply could not be
beholden to her in that way. 33
9
There was his father in Chatham, but to borrow from him struck
Couzens as being almost as distasteful. Yet he swallowed his pride
and made the trip across the river to Chatham. He knew that, like
his mother-in-law, his father had a nest egg, though not as much
as $15,000. The elder Couzens had come a fairly long way from the
time when he was a dollar-a-day laborer at a soap works. But he
quickly and tartly demonstrated that he had no intention of parting
with any of his funds, not even on a loan, for any such foolish enter
prise as his son described to him.
“You should not even invest your own money!” the elder Couzens
exclaimed. 34
Rosetta Couzens had $300, saved from her earnings as a public-


42
THE MONEY-MAKING MACHINE
school teacher in Chatham. She was willing to lend that to her
brother. But again, the father raised heated objections. Finally,
Rosetta compromised and offered $150. “But he wanted it in even
hundreds, so I gave him $100.” 35
Couzens returned to Detroit with the disappointing conviction
that all he could invest was $500—his $400 and his sister’s $100.
Luckily, he found Malcomson in one of his expansive moods. Mal
comson agreed to advance him $500 on his expected bonus, and
also arranged for acceptance of a promissory note of $1,500. Thus,
among the twelve shareholders—Alex Y. Malcomson and eleven
disciples, so to speak—Couzens finally was recorded as a holder of
$2,500 worth of stock. 36 In Couzens’ view, there actually should have
been thirteen shareholders, counting his sister Rosetta. But Ford
objected strenuously to a woman being allowed in the enterprise—
any woman—so Couzens carried Rosetta’s one share in his own
name. 37
It irked Couzens that, except for the junior clerk, Woodall, he
was low man on the shareholders’ list, and it is probable that he
suspected Woodall’s interest was really a “blind” for Malcomson—
a way for Malcomson to have a bigger interest than Ford. But there
was no way for Couzens to improve his position at the time, and
so he made the best of it, while making a mental note to correct this
matter some time in the future.
10
On June 16, 1903, the Ford Motor Company was incorporated.
Two days later, the twelve stockholders held an organizational meet
ing at the Russel House, a Detroit hotel.
Malcomson had expected to be chosen president. But that office
went to banker Gray—an irony, in view of Ford’s later attitude to
ward bankers—and Malcomson was named treasurer.
Ford was not even considered for president. Everyone concerned,
even Ford, agreed that to have Ford as president would probably
have been fatal to the financial rating of the new company. Instead,
he was given the title of vice-president and general manager in
charge of mechanics and production. 38
The posts of business manager, in active charge of all business
affairs of the new company, as well as of secretary, went to Couzens. 39
This was another disappointment for Malcomson, who had intended
to be the business manager himself. His plan was to have Couzens


THE FORD MOTOR COMPANY
43
run the coal office, but John S. Gray, still worrying about his bank’s
loans to the Malcomson Fuel Company, decided matters otherwise.
“I am putting up my money because you are a good coal man,” Gray
told Malcomson. “You must stay in the coal business.”
Malcomson argued that the coal business would be safe with
Couzens in charge. He praised Couzens’ extraordinary ability. “If
Couzens is so good,” said Gray, “then you can send him to the auto
mobile business. He can watch that for you.” 40
Malcomson had no answer to this, and the decision that was finally
made was in line with John Anderson’s report on June 4, 1903, to
his father in LaCrosse:
“Mr. Couzens ... is going to leave the coal business, for the
present at least, and devote his entire time to the office and manage
ment of the automobile business. And he is a crackerjack.” 41


44
CHAPTER VIII
THE BUSINESS MANAGER
As though by instinct the “crackerjack” paired off with Ford after
the organizational meeting. Ford volunteered to take Couzens home
in his odd-looking, tiller-steered runabout, and Couzens accepted
the invitation. For the Ford Motor Company, this was the real
beginning—and also for the two “partners,” as, in due time, they
would be called.
Up to that moment they had not had much to do with each other.
“In the beginning, I did not esteem Couzens highly,” Ford recalled. 1
As for Couzens, it has already been noted that he had no better
opinion of Ford. Now things between them were different.
Ford had special reasons for seeking to cultivate Couzens. It obvi
ously bothered him that his associates in the company were strong
men who could out-talk him and, so long as he owned only a fraction
more than a quarter of the stock, out-vote him. He felt the need
of support, as he would often in the future. Only then could he
function. 2 And Couzens seemed to be his man, for he would feel
much less like a lamb among lions if Couzens were lined up with
him. “He does his own thinking, no one could tell him what to do,”
Ford later said, and he appreciated that quality in Couzens—then.
For his part Couzens also was looking to the future. He seemed
to recognize almost at once that his future lay more with Ford than
with Malcomson. With Malcomson he would always have had to
maintain a junior relationship, or leave him. But with Ford, he
could expect a more equal relationship, even an equal one. Or so
he thought. Besides, whether he realized it or not, he was psycho
logically attracted by Ford’s apparent meekness, the easygoing ways
that made him appear so different from Malcomson, the side of his
personality that Ford usually showed at this time. 3


THE BUSINESS MANAGER
45
2
As they bounced along that evening in Ford’s car, both wearing
derbies—Ford’s somewhat at an angle over his birdlike face, Couzens’
square, firm, and level on his solid head—they talked of their plans.
Among other matters, they discussed the salary each might expect
from the new company. Couzens suggested $3,000 a year for Ford,
$2,400 for himself. Ford, the mechanic, wondered if $3,000 were
not too much.
“No,” said Couzens, the businessman. “This could be an important
project.” 3 4
Ford’s way of introducing to Couzens the matter of salaries was
especially interesting: “What do you think we ought to ask from
those fellows?** Couzens of course caught on to Ford’s meaning. On
one side there was to be Ford and Couzens; on the other, “those
fellows.” Already there was a division in the new company, and Ford
also made some vague remarks, that June night, which caused
Couzens later to believe he had said as well: “If this succeeds, I will
go fifty-fifty with you.” 5
3
The next day the two managers began working together. The
place was Strelow’s barnlike carpenter shop on Mack Avenue, on
which was painted a sign that read: Ford Motor Company.
There were as yet no cars. There were only space and some un
assembled parts. The motors and chassis were in a state of “being,”
at the Dodge brothers’ machine shop. This, of course, was by design,
for Malcomson’s original idea was adhered to. The company was
to make no pretense of being a manufacturing concern. It was to
be only an assembling and selling organization. This was agreeable
to Ford as well as to the others. “If the automobile craze goes to
smash, I don’t want my money tied up in walls and machinery,” 6
Ford said.
But the “craze” did not “go to smash.” The new business “moved
along almost as by magic,” as Ford remembered it. 7 The “magic”
lay, in the main, in the public demand for automobiles—any kind
of automobiles. It was a demand that no automobile manufacturer
up to then had been able to satisfy.
Specifically, for the new company the magic lay in those advance
orders Malcomson had obtained from his desperate advertising. “One


THE MONEY-MAKING MACHINE
46
dealer from Buffalo was here last week and ordered twenty-five.
Three were ordered today, and other orders have begun to come
in every day,” Anderson reported. 8
To assist in assembling the cars, C. Harold Wills, of the defunct
“Henry Ford Company,” a tall, dynamic, and resourceful man, was
brought in to serve as a sort of foreman over about half a dozen
hastily recruited mechanics. 9 Both Ford and Wills maintained a
heroic pace in the assembly work to keep pace with the production
activity of the Dodge brothers.
4
Speed was essential. In those days cars were sold mostly during
the summer months, and it was already past the middle of June.
Moreover, the new company’s total working capital was only $28,000
to take care of payrolls, advertising, and the like, for others besides
Couzens were represented in the final accounting only by promissory
notes. 10 If the first season was muffed, this $28,000 would not be
nearly enough.
Yet in “the factory” Ford and Wills labored no harder than did
Couzens in “the business office.” Most of the time he was on the
job in the office and sales room of the plant from seven in the morning
until after eleven at night. 11
Couzens also played an important role in the production phase,
for Ford’s old perfectionism came close to endangering his third
venture before it was even under way. Because he felt “they were
not yet as good as he could make them,” Ford held up shipment of the
first cars. Couzens put his foot down—his first, but not his last,
crucial act in the company. He insisted that the cars must go out so
that money would come in. 12 He was not going to let Ford do to this
company what he apparently had done to the Detroit Automobile
Company. For a long time, the point has been made by automobile,
and other, historians that Ford was very different in 1903 from the
way he had been in 1902 in the matter of getting the cars out. In
1950, one such historian, Milo M. Quaife, commented: “How to
account for this sudden change of attitude on the part of Mr. Ford
is still a subject of speculation. As good a guess as any would be that
he was now subject to the influence of such aggressive action as
Couzens and John and Horace Dodge.” 13


THE BUSINESS MANAGER
47
5
To make doubly certain that there was no slip, Couzens even
joined Ford and Wills in the manual task of getting the first cars to
the railroad freight station. He helped to crate them and to nail
the doors of the freight car. Then, putting back on his black, four-
button jacket, he went to the bank to draw sight drafts on purchasers
in Indianapolis, Minneapolis, and St. Paul, to whom those first cars
were shipped on July 23, 1903. 14
At last the new Ford company was on its way.
But once again, Ford's perfectionism threatened the venture.
Shortly after the first cars had been delivered, complaints began
coming in. Some of the cars would not climb even modest hills.
Couzens knew by personal experience the validity of these com
plaints. When John Anderson's father came up from LaGrosse to
visit the plant, Couzens volunteered to drive him to the railroad
station. “On the way, he attempted to drive through a small park,
but the car stalled at a little hill and after frequent attempts to cross
the hill, Mr. Couzens was forced to detour around the block," said
Dr. Anderson. 15 Ford was mortified and said that all shipments must
be halted immediately.
Again Couzens took a firm stand. If necessary, mechanics should
be sent to the customers to work on their cars, but he insisted that
the cars must go out. “Stop shipping and we go brankrupt."
Couzens' judgment again prevailed, 16 and re-orders came in from
the dealers.
6
The company’s first “annual statement" was prepared by Couzens
as of October 1, 1903. Sales from July 23 to September 30 totaled
$142,481.72. Profits were estimated at $36,957.64.
In November 1903, on the basis of this showing, the directors
voted for a dividend of 10 per cent. Couzens was given a new title,
“Sales Manager," and his salary was increased from $2,400 to $3,000
a year. He was also authorized to employ a stenographer.
Another dividend, this time of 20 per cent, was voted at the first
directors’ meeting held in 1904. On the company’s first anniversary,
by which time a thousand cars had been sold, the directors celebrated
with a dividend of 68 per cent. 17 Everyone in the enterprise had by
that time taken out nearly 100 per cent. “Ford and I then declared


THE MONEY-MAKING MACHINE
48
our independence/* Couzens commented later. They felt that they
now had rights above the others. They were the producers; the
others were “coupon clippers,*’ and they intended that the distinc
tion should be recognized. 18
7
As the year 1904 was closing, the company moved to its own
four-story building at Piquette and Beaubien Streets. For the first
time, the company began to manufacture its own small parts. 19
On June 16, 1905, a cash dividend of 100 per cent was declared.
This was followed by another of the same size only one month later.
Two hundred per cent in one year, nearly 300 per cent since the
company had been organized only two years before! 20
Perhaps “magic** was a factor, but it was not only magic. As put by
one informed Ford Company employee: “Everyone worked like dogs,
early and late, without regard to the hours of service or where they
had to go to do it.** 21 And Couzens was the pace setter. “In those
days,” said the Ford Times, “J.C. was the entire office management—
he hired and fired—he kept the books, collected, spent, and saved
the cash, established agencies, and dictated policy.”
The company paper added that what Couzens did was too much
“for most men but he did it.” 22 Garet Garrett, a specialist in writing
about business, who for many years paid great attention to the Ford
Company, perhaps told the whole story best and most pungently
when, in 1952, in his book The Wild Wheel, he summarized Couzens*
role: “From the beginning . . . James Couzens had been the great
he-person in the Ford organization. His gifts were four—a genius
for the role of ringmaster in the arena of business, an immense store
of energy, a terrible temper and leonine roaring pouches.” 23


49
CHAPTER IX
THE CLOUD
By 1903, at least 145 other automobile firms had been founded in the
United States. Already, despite the public’s continued interest in
motoring, most of them had disappeared. “Look at the constantly
lengthening list of ‘dead ones’ in the automobile trade,” the Auto
mobile Magazine warned in December 1903. At that time the Ford
car was not priced lower than a number of other cars—indeed, it
cost more than some. Then what did the Ford Motor Company have
that kept it alive?
In 1908, the Ford Times itself gave one answer: “While Henry
Ford had the right car and inexhaustible confidence, push, and fight,
it has been Mr. Couzens who has had to meet and solve those prob
lems which daily confront every business enterprise and ruin or make
it, according to the way they are met.” 1
How carefully Couzens looked after details is shown by some en
tries in a notebook he kept: “Boston says March telephone bill not
paid, $6.69.” “Mail Robbins check.” “Get one bond for Block.”
“Philadelphia needs trouble-locater.” “Radiator leaking.” “Nuts on
lamps hurt in cranking.” “Cushion on rear seat not fastened.” “Bat
tery box off.” “Wood-screws on fenders don’t hold.” “The gears on
Buffalo K absolutely abominable.” 2
The production men heard about such things from him.
a
With dealers, if not with the public, he turned out to be a kind
of supersalesman. Charles T. Bennett saw him in operation at the
plant. “A man came in from a West Coast city to inquire about be
ing a dealer. He had in mind ordering one car. Mr. Couzens asked
him for the population of his town and when he learned the answer,
said, ‘For a town that size you ought to order 100 cars!’ He talked


50
THE MONEY-MAKING MACHINE
the man into doing just that, and what's more, collected in advance
for the ordered cars." 3
He also demonstrated a keen sense for picking dealers and sales
men who would be hustlers like himself—men like urbane Gaston
Plan tiff in New York, knowing Louis Block in Philadelphia, hustling
Tom Hay in Chicago, and ubiquitous Guy Herring in Des Moines,
pillars of the Ford sales hierarchy for years. He personally selected
all the Ford dealers and salesmen.
Couzens also made several innovations in organizing his sales
force. Key sales points were manned by salaried employes rather than
by independent agents. He called them branch managers, and they
took instructions directly from him. William C. Durant of the Buick
Company (later founder of General Motors) told him that such a
plan would not work. “You cannot get a man to work for you as
hard as he will work for himself." Couzens said: “We will pay him
more than he could possibly earn for himself." 4 And for him, and the
Ford Company, this plan worked superbly.
Other departures marked his management. He developed an in
centive system. On top of their salaries, the managers received bo
nuses when sales topped certain figures. This was new for those days.
“If the Ford Company had begun with traditions, no one would
know of that company today," Couzens said in 1921. “It made its
success by striking out for itself and I imagine if we had only had
more experience, we might have gone about our work differently.
Certainly we should not have known that many of our most successful
innovations could not possibly succeed!" 5
3
Yet he was a cautious financial administrator. Extensions had to be
paid for out of profits, not borrowed money. “It is easy to spend too
much when money can be freely borrowed," he said. 6 He learned
early not to speculate on materials.
“When we started business we were informed," he recalled, “that
it was a safe rule to buy liberally on a rising market and to go slow
on a falling market. . . . Time and again we tried it, and time and
again we found that in the end we were no better off in price than
if we had bought right along as we needed and at the market price.
. . . The material speculator is as certain to be hit as the stock spec
ulator." 7
He set the company's credit policy. As stated in the Ford Times, it
was:


THE CLOUD
51
“The Ford Motor Company never cuts a price, is never a party to
a trade deal, does not consider anything but real money in selling
cars, quotes no discounts or special allowances and would carry a
thousand cars over rather than discount the price. ,, 8
4
He knew precisely how he wanted company affairs handled. Corre
spondence had to be taken care of on the dot. Accounts had to be
kept precisely. Instructions had to be followed out to the letter.
Contracts had to be fulfilled to the last comma. Infractions of such
rules brought from him rebukes that made such infractions rare.
He was still a hard man to work for. Success did not soften him.
He would remain as he was from now on by deliberate intention
as much as by temperament. Like John D. Rockefeller, who once
told members of a Bible class not to be “good fellows” because “good
fellows end up in the poor houses,” he earnestly believed that being
a good fellow was incompatible with being a good businessman—
perhaps a rationalization of his own temperament. “I am one of those
who hold that it is not worthwhile to attempt to be popular. I
should prefer to be a hard taskmaster—but a fair one,” he once
said. 5 * * * 9 “A floor walker in a big department store gets twenty-five or
fifty dollars a week because he knows how to be pleasant and shake
hands with the trade. But the man in the back room, who buys the
goods and runs the business, gets $50,000 to $100,000 a year because
he knows how to run the business.” 10
He prided himself on his fairness to an extreme—a fact that once
cost a branch manager a tidy sum. About the time that bonuses were
given out, this man wrote to Couzens to tell him what a good manager
he was, with the bonus in mind, as Couzens understood. He wrote
back: “I had put you down for $21,000 before I received your letter.
Your letter has cost you $5,000, because it showed me that you did
not trust me to treat you fairly. I have now put you down for $16,
000.” 11
5
Indeed, he had become a businessman. He looked the part, too.
He had filled out since the days when he had been a slender coal
clerk, sitting on a high stool in the window of the Malcomson com
pany. That rather tight look that had characterized his eyes before
had now become one of firm assurance.
His face was rounder. He wore his hair, which was carefully parted


5*
THE MONEY-MAKING MACHINE
down the middle, less closely clipped than before. There was about
him now not so much the “don’t-tread-on-me” manner as “be-careful-
or-I-may-tread-on-you.”
Milton A. McRae, the Scripps-McRae newspapers executive, met
him about this time and made a mental note that “here was a comer,”
a man with leadership ability. 12 Others were puzzled by his aloof,
outwardly cold manner. “In spite of all our meetings, I feel that I
really do not know him . . . that there is something in reserve
that I do not get at,” said James Wilkie, the pharmaceutical merchant
and Detroit civic leader. 13 But Ida M. Tarbell, the biographer and
industrial historian, who saw him a little later, was not perplexed
by his aloof manner. She catalogued him as a man who would leave
a mark. 14
He moved his family into a somewhat better residence on middle-
class Frederick Street. In 1904 a daughter, Madeleine, was born.
That same year, after paying off his promissory notes in the com
pany, he prudently invested his Ford dividends in a house at 80
Chandler Avenue, for which he paid $7,500. Owner of his own home,
father of three children, a key figure in a new industry, he was now,
at last, beginning to fulfill the promise of the resourceful, independ
ent boy of Chatham.
6
Yet there remained a cloud.
The company had been born under this cloud, for as early as
July 1900 the owners of a certain patent had begun filing suits for
infringement against various automobile manufacturers. More
over, the validity of the patent had been conceded by Alexander
Winton, then the leader in the industry. In March 1903 there was
formed “The Association of Licensed Automobile Manufacturers,”
with the avowed purpose of forcing out of business anyone not
licensed under the patent.
Not everyone would be licensed, either; the Association intended
to practice discrimination.
Malcomson had gone about organizing the Ford Motor Company
in ignorance of this patent, as well as of the existence of the Asso
ciation of Licensed Automobile Manufacturers. In their own ex
citement, John Anderson and Horace Rackham, his lawyers, had
not checked very well the patent status of the automobile, although
Anderson later said that he had “made a very careful investigation,


THE CLOUD
53
as careful as I thought a man could make, before I ventured my
money in the Ford Motor Company/’ 15 Had they checked, it is
most probable that they would have held back, and would have
discouraged the others. So this, too, may have been part of the
“magic.” Not until a week or so after the Ford Motor Company
was organized did any of the Ford promoters hear about the matter
of the patent.
7
But then, this is what they learned: Back in the early i87o’s,
George B. Selden of Rochester, a lawyer with a mechanical turn
of mind, a member of a prominent up-state New York family, had
begun studying horseless locomotion. According to his son, he
was inspired to do this by “some disagreeable experiences” with
horses while serving with the United States cavalry during the Civil
War. 16 His idea was to “construct a light-weight self-propelled vehi
cle with a large cruising radius, which could be operated by one
man, not a skilled engineer.” 17
Selden at first experimented with a steam engine. Then he turned
to the internal-combustion type. By 1879, he had progressed far
enough to apply for a patent on this latter engine. 18 He had interested
six financial sponsors, but “one of these men died suddenly; another
went into bankruptcy; another became ill; still another met with
an accident. The remainder changed their minds.” 19
Selden then determined to wait for the world to catch up with
him. He contrived to postpone the issuance of a patent, but kept
his application alive through a long series of “amendments.” The
patent was issued on March 5, 1899, a f ter he had entered into an
assignment of it to the Columbia and Electric Vehicle Company.
The owners of the Columbia and Electric Vehicle Company were
a group of Wall Street financiers, including William C. Whitney,
who were backing electric automobiles. Apparently they had no
serious intention of producing cars themselves, but they intended to
extract royalties from those who did—at the rate of 5 per cent.
Under the leadership of the Olds Motor Company, a group of
Detroit manufacturers then formed a protective committee. They
had a showdqwn with Whitney and the others of the Wall Street
group. But instead of challenging the royalty principle, they merely
took it over, after forcing Whitney and his associates to agree to
reduce the royalty from 5 per cent to 1% P er cent, of which only


54
THE MONEY-MAKING MACHINE
three-fifths would go to the patent holders. Two-fifths would go to
their committee, which then would undertake to fight infringements
and to police the industry.
Among the admitted, even boasted, aims of this committee was
a restriction of production. Only manufacturers granted a license
could produce cars, and these had to agree to limit the number of
cars produced to a figure set by the committee. It was this committee
that became “The Association of Licensed Automobile Manufac
turers.” 20
Couzens first heard about all this a few days after the Ford Com
pany was established, when John Anderson gloomily reported a
conversation he had had with Frederic L. Smith, then head of the
Olds organization and later president of the Association of Licensed
Automobile Manufacturers. John Anderson, whose middle name
of Wendell was an inheritance from the Wendell clan that included
Oliver Wendell Holmes, Senior, may have then recalled that he was
a descendant of the New Englander who owned the “Wonderful
One-Hoss Shay” which Holmes immortalized for having gone to
pieces all at once. He may have wondered if the Ford Company,
with his investment and its prospects, might not go the same way. 21
For Anderson was convinced by his talk with Smith that he had
invested “in a man’s size lawsuit, instead of in an automobile com
pany.” He suffered “a feeling of gone-ness in his stomach.” 22
The seriousness of the situation became more apparent on July
26, 1903, when an advertisement appeared in the Detroit Free Press
as follows:
NOTICE
To Manufacturers, Dealers, Importers, Agents and Users of
GASOLINE AUTOMOBILES
United States Patent No. 549, 160 granted to George B. Selden,
November 5th, 1895, controls broadly all gasoline automobiles
which are accepted as commercially practical. Licenses under this
patent have been secured from the owners by the following named
manufacturers and importers. . . .
No other manufacturers are authorized to make or sell gasoline
automobiles, and any person making, selling, or using such machines
9iade or sold by any unlicensed manufacturers or importers will
be liable to prosecution for infringement.
Association of Licensed Automobile
Manufacturers
No. 7 East 42nd Street, New York. 23


THE CLOUD
55
A conference between Smith and the officers of the Ford Motor
Company was held at the Russel House. In after years, Smith wrote:
“By what miracle that flimsy patent was ever sustained ... I know
not/’ 24 But at this meeting, he politely, but firmly, repeated: the
Ford Company could not stay in business unless licensed. For the
Ford organization, he had only one kind of advice: they should go
out of business. The Ford people were only assemblers, not manufac
turers. Assemblers were not wanted. 25
Nobody among Smith’s listeners said anything for awhile. They
had been told that a legal fight for carrying the matter to the highest
court would cost at least $40,000, nearly as much as the total in
vestment in the company. And there was no assurance that such a
fight could be won. The patent lawyer in Detroit with the best
reputation, Ralzemond A. Parker, whom they had consulted, had
guessed that the chances of losing were high. Some of the Ford
stockholders were for yielding to what appeared to be the inevitable.
Others, Malcomson included, hoped for some kind of a compromise.
Banker Gray talked moodily. He lamented that now he could not
even unload his stock on others because he could not “conscien
tiously” recommend the shares as being a good investment 26
Couzens broke the indecision and gloom. Following the pattern
he had established as a boy in Chatham, as a freight clerk at the
Michigan Central, and as assistant to Malcomson, he told Smith:
“Selden can take his patent and go to Hell with it!”
“Couzens has answered you,” said Ford. 27


56
CHAPTER X
THE REALIGNMENT
At the next directors’ meeting it was voted unanimously “to throw
down the gauntlet, come what may.” 1 Space in newspapers was
purchased for denunciations of the Selden patent. These Ford ad
vertisements assured prospective car buyers, “We will protect you.”
Then, to offset the Licensed Association, the Ford Company took
the lead among independent firms in organizing a rival association,
“The American Motor Car Manufacturers’ Association.” Formed
at a meeting in New York, this association, for years afterwards
a major factor in the industry, picked Couzens for its first president. 2
Thus he became the official voice of the opponents of the “monopoly
manufacturers.”
In the meantime, he dusted off his old law books and acquired
others with which to begin reading law once more—patent law.
Before long, he was able to talk on almost equal terms with the
patent lawyers and often, at conferences, advised them on procedures
and pleadings. 3
When a trade publication asked the Ford Company for a public
statement on its strategy, the answer was abrupt and to the point:
We regard the claims made under the Selden patent as . . . en
tirely unwarranted and without foundation in fact. We do not,
therefore, propose to respect any such claims, and, if the issue is
forced upon us, shall defend not only ourselves but our agents and
customers to the fullest extent . . .
Yours Truly,
J. Couzens, Secretary 4
Up to that time the Licensed Association had taken no legal
action against the Ford Motor Company. But after the appearance
of this letter, it acted. In the U.S. Circuit Court, Southern District
of New York, two suits were filed at the same time: one against the


THE REALIGNMENT
57
Ford Motor Company, another against its New York agent, C. A.
Duerr & Co. A week later another suit was filed against a Ford cus
tomer, the O. J. Gude Company, to restrain it from even using a
Ford car it had purchased. 3 * 5 So the legal issues were joined.
2
The ensuing battle was fought on the propaganda front as well
as in court. New advertising barrages that specifically warned the
public against the sale, purchase, or use of Fords were set off by the
Licensed Association. Any “infraction” would lead to prosecution,
these ads said. Fords were barred from the automobile shows held
at Madison Square Garden. In reply, the Ford Company then ad
vertised that it would put up surety bonds “to protect dealers, im
porters, agents and users from any attempt on the part of the TRUST
to prevent you from buying the ‘car of satisfaction.’ ” The American
Motor Car Association, under Couzens’ leadership, held its own
annual shows—events that soon rivaled, at least in ballyhoo, the
exhibits in Madison Square Garden.
The word “trust” was featured in much of the Ford advertising—
shrewd exploitation of what was then becoming a popular political
issue, thanks to President Theodore Roosevelt’s “trust-busting” pro
gram.
On this issue of “monopoly,” the Ford Company soon acquired
an interesting and powerful ally, John Wanamaker. The great
Philadephia and New York merchant, John Wanamaker, had fought
a patent war with the so-called bicycle “trust.” Now he looked for
ward to another and similar fight. Already handling Fords in his
stores, Wanamaker began to feature them in his advertising. In
January 1904 the Licensed Association filed suit against Wanamaker,
and he hit back with full-page advertisements saying:
“Get a Ford car and enjoy it. We’ll take care of the tomtoms.
Don’t give $600 to the Bogey man.” 6
3
All this uproar had an unanticipated result—perhaps the most
important single thing that happened in the early days of the com
pany. As Couzens said later, “The Selden suit was probably better
advertising than anything we could put out.” 7
All the attention given to the controversy made the Ford car the
best-known make in the land. Many persons bought Fords because


THE MONEY-MAKING MACHINE
58
they were the only automobile they had heard about. Others
bought Fords because they hated “monopoly,” or just to be contrary;
still others because “Honest John” Wanamaker said they were good
cars.
There was at least one other important result. Both Couzens and
Ford came to feel great admiration for Wanamaker, who was then
plumping a novel concept of business—that the purpose of business
was to render “service to the public,” that it was a duty of merchants
to distribute products at the lowest price possible.
Both Couzens and Ford began to think and talk the same way.
The influence of Wanamaker, indeed, may have been the central
inspiration for the later, and world-celebrated, concept of the Ford
Motor Company—that of producing and selling cars at low cost:
the foundation of the mass-production system in heavy industry.
Undoubtedly, too, Couzens' attitude toward “big business” in
general, as well as Ford's, was shaped in part by the Wanamaker
influence, just as Pingree earlier had left an impression upon Couzens
with respect to the labor problem.
Immediately, the fight engendered a crusading spirit on the part
of the company and its dealers and salesmen. Ford advertisements
reflected a spirit of pugnaciousness that was pure Couzens. A typical
Ford announcement in Harper's said:
We hear a lot these days about “hand-made” motor cars. It's
funny, but these same concerns who, a year ago, prated of “quality,
not quantity,” as if the two were incompatible, now build 1,000
to 2,000 cars per year and still expect you to believe it is “hand
work,” “personal supervision,” and all that sort of rot. . . . 8
One day an Ohio Ford dealer telegraphed to Couzens: “My
competitor wants to bet $500 that their machine will make a trip
to Columbus and return quicker than the Ford Model S. Is it safe
to bet?” Couzens answered: “Is it any credit for the United States
to whip Venezuela? Take a bet like that with any car selling between
$1,500 and $2,500.” 0 This spirit paid off in sales, of course.
Yet the Selden cloud was to remain as a vexation and a threat
until the courts finally decided the issue. As Horace Rackham ob
served, “The company could not determine what the future would
be.” 10
Gray streaks showed up at Couzens' temples. He began to be
tormented for the first time by massively painful migraine head-


THE REALIGNMENT
59
aches. He consumed enormous quantities of aspirin. But he con
tinued to push Ford sales just as if Selden really had gone to Hell
with his patent.
And the company kept growing.
4
And Malcomson? In the light of his dominant importance in
the formation of the company, it is a curious thing how little he
figured in its affairs after the company was launched. This is not
to be explained simply by saying that Malcomson was “too busy”
at the coal office, nor by the assumption that he was content to let
his former assistant take over completely. Nor is it to be explained
by the fact that Couzens had demonstrated his ability to take over—
true though this was. The fact is that in the genesis of the Ford
Motor Company, Malcomson was doomed to play the role of a Moses,
with Couzens his Joshua.
Like some of its cars, the Ford Motor Company very early de
veloped “internal trouble.” Ford’s “those fellows” comment had
borne strange fruit. There had come to the surface almost immedi
ately a bad case of temperamental incompatibility. This arose not
only between Malcomson and Ford, but also between Malcomson
and John and Horace Dodge, and to an extent between Malcomson
and Gray.
But it was most acute between Malcomson and Ford. After the
first year, neither could abide the other. In the words of Rackham,
“Both wanted to be boss.” 5 * * * * * 11 And Ford, as soon would be apparent,
was not at all the timid or lackadaisical man he had given the im
pression of being.
5
So long as the company appeared to be struggling, both Ford and
Malcomson suppressed their true feelings, but the first appearance
of prosperity brought a change. Directors’ meetings became marked
by explosive bickering. “There was much pounding on the table,
and at times Ford’s directors would get up and leave and refuse to
come back.” 12
Couzens, not surprisingly, touched off some of these explosions.
When Malcomson took an order for an automobile to be delivered
to a friend at a discount, it was Couzens who insisted that there
should be no discounts to anyone, not even to a friend of Malcom-


6o
THE MONEY-MAKING MACHINE
son. “He protested so vigorously that the other stockholders voted
to compel Malcomson to pay the difference." 13 Malcomson con
sidered this a personal affront.
In arguments between Ford and Malcomson, Couzens invariably
stood with Ford, in accord with the understanding the two of them
had reached on that June evening in 1903. Indeed, it became clear
that Couzens was Ford's spokesman on all business matters, that if
Ford kept silent, but Couzens spoke, it was really Ford, as well as
Couzens, speaking. They began to seem like one person, and Mal
comson resented this.
Couzens had begun to develop a deeper affection for Ford than
he had ever had for Malcomson. Ford seemed to reciprocate that
affection, although he did maintain a conscious line beyond which
he would not let friendship carry him. Once, early in their relation
ship, he said to Couzens, “It is a mistake to make or have too strong
attachments, because it weakens your will and your character." 14
Few persons ever heard them address each other in any way except
“Mr. Ford" and “Mr. Couzens." Yet, T. J. Hay, the Chicago dealer,
felt “they were like brothers."
Couzens saw that eventually either Ford or Malcomson would
have to leave the company. If he himself wanted to stay, he had to
choose sides. Actually, he had no choice, for Malcomson forced
matters by his authoritarian and antagonistic attitude toward his
proteg£. Not long after the business was well under way, Malcomson
flatly demanded that Couzens voluntarily return to the coal company.
Couzens refused. 15 At a directors' meeting later, Malcomson moved
that Couzens be discharged as business manager. 10 The antagonism
was out in the open.
6
There were five directors, each with an equal vote regardless of
the amount of stock owned: Malcomson, Ford, John Dodge, John
S. Gray, and John Anderson. If he could get two other directors to
side with him, Malcomson would win his point about firing Couzens
and establish his own supremacy in the company—even over
Ford. Ford, of course, stood by Couzens. “I told Malcomson that I
did not want him, but that I wanted his man Couzens," he later
said. 17 And banker Gray stood by Couzens too.
John Dodge might not have cared too much for Couzens at that
time. But, as he once said in court, he “really did not like Malcom
son," 18 perhaps because, when the contract with the Dodge brothers


THE REALIGNMENT
6l
had come up for renewal in 1904, Malcomson argued that the Dodges
should reduce their price since their risk was less. Couzens had
sided with the Dodges in that controversy, 19 and now John Dodge
sided with Couzens.
Only John Anderson, Malcomson’s lawyer, sided with Malcom
son. 20 So Couzens remained as manager.
7
In September 1905 Malcomson raised another row at a directors’
meeting because Couzens’ salary was raised to $8,ooo. 21 Obviously, his
objection was emotional. That year, the company had earned a net
profit of $285,23i.94. 22 The other directors voted Malcomson down.
After that, even Malcomson had to concede that his own former
clerk had supplanted him completely as the dominant businessman
of the Ford Motor Company.
Which way the wind was blowing, how firmly the Ford-Couzens
alliance had already jelled, was made evident even before this, when
the Ford Motor Company of Canada was organized in 1904. In this
corporation, Ford was president and Couzens was vice-president.
But Malcomson was left out. 23
In the parent company Malcomson was still treasurer, as well
as a principal stockholder. But he really had little to say about
policies. Ford and Couzens already had attained, substantially, their
planned goal—independence from “those fellows.”
Malcomson then did an astonishing thing. He formed another
automobile company, the Aero, with himself as president, and set
up a plant for turning out air-cooled “Aeros” not far from the Ford
factory. Apparently his plan was to use his dividends from the Ford
Motor Company for financing his own company, not only to add to
his income, but also to show Ford, Couzens, and the others how an
automobile company should be operated. Unquestionably, Malcom
son took this step in anticipation of his complete separation from
the Ford Motor Company, either voluntarily, or by being frozen out
despite his large interest.
8
A procedure for freezing, or squeezing, Malcomson, as well as
some of the others, out of the company already had been devised in
the fall of 1905. This consisted of an interesting plan for organ
izing another corporation, “The Ford Manufacturing Company.”
Ostensibly this second corporation was to make motors and other


62
THE MONEY-MAKING MACHINE
parts for the Ford Motor Company. Ostensibly, too, its creation was
desirable for efficiency, as well as to make any expansion of facilities
by the Dodge brothers unnecessary. 24 It was to be wholly controlled
by the Ford Motor Company. But there was one important catch.
Not all the stockholders in the parent company were to have an in
terest in the subsidiary. Malcomson, for one, was not to be included.
Moreover, matters could be so arranged—for example, by the prices
that the Ford Motor Company might pay the Ford Manufacturing
Company for motors and parts—that the profits of the original com
pany could be drained off into the subsidiary. Indeed, the subsidiary
could swallow up the parent company.
The real purpose of the Ford Manufacturing Company was under
lined by a comment made by Banker Gray. Vernon Fry had voiced
to him his worries about the possible effect of the subsidiary on the
parent company. “I have Mr. Ford’s promise,” said Gray, “that when
they get things straightened out with Mr. Malcomson, the Ford
Manufacturing Company is to be taken into the Ford Motor Com
pany, just as if it had never existed.” 25
9
Not long after this plan had been devised, a resolution that
formally requested Malcomson to resign as treasurer and as director
was adopted by the board of the Ford Motor Company. “Moved by
Mr. Rackham and seconded by Mr. Ford,” this request was justified,
for the record, on the ground that Malcomson’s formation of another
automobile company was “inimical to the best interest of the com
pany.” 26
In the following week, The Ford Manufacturing Company was
officially incorporated. 27 Later, a contract was entered into between
it and the Ford Motor Company for it to supply ten thousand engines
at a price not stipulated. And a building was fitted up for the sub
sidiary. Besides Ford and Couzens, the incorporators were the Dodge
brothers, Rackham, Anderson, Bennett, and Wills. 28 Left out of
the subsidiary were Gray, Fry, Strelow, Woodall, and, of course,
Malcomson.
The morality of this procedure could be discussed and debated
endlessly. Both Ford and Couzens unquestionably owed much to
Malcomson. He was the real founder of the Ford Motor Company;
he had given both men their start. However, it is doubtful if any
of the principals in this drama looked at the matter at the time


THE REALIGNMENT
63
from the viewpoint of gratitude or loyalty—not even Malcomson.
These were businessmen engaged in the game of business, playing
the game according to the accepted rules. All played the game the
same way and had the same objectives.
10
Malcomson put up a fight. In a letter to the board of directors,
he indignantly refused to resign as treasurer and director. He de
nounced “such occurrences as the recent precipitate action of the
board in doubling the manager’s [Couzens’] salary, despite protest
and without waiting for a full board meeting.” Then he criticized
bitterly the organization of the Ford Manufacturing Company. It
was a scheme, he said, for causing “injury to those stockholders of
the motor company that are left on the outside.” He threatened a
lawsuit to block the manufacturing company plan. 29
His letter was ordered “placed on file.” 30 It appeared that Mal
comson had won a victory, for he did not resign as treasurer.
However, when the year 1906 opened, Malcomson was for all
practical purposes, except for his ownership of stock, out of the Ford
Motor Company. He was concentrating on his own company. And
he issued an optimistic statement to the trade press: “We start in
1906, put up a factory and turn out 500 cars in one year. I believe
that is a record.” 31 It was better than the Ford Motor Company had
done. He advertised his product as “The Car of Today, Tomorrow,
and for Years to Come.” 32
In that optimistic mood, in May 1906, Malcomson made what later
proved one of the great blunders in business history: he sold his one-
fourth ownership of the Ford Motor Company to Ford. Couzens
handled this deal for Ford. 33 His trump card in the negotiations was
the existence of the Ford Manufacturing Company. Malcomson, of
course, knew what that meant—-that the profits of the Ford Motor
Company could be siphoned out of it into the manufacturing com
pany, to the point where Malcomson’s one-fourth interest in the
parent company could be made worthless. 34 Besides, Malcomson was
fearful of the outcome of the Selden case.
He finally agreed to sell his one-fourth interest to Ford for $175,
000. Thus Malcomson, the real founder, in the phraseology of the
principal Ford historian, was “jettisoned” from the company. Thus,
too, for the first time, Henry Ford won a dominating interest in
the company that bore his name. John Gray died in the following


THE MONEY-MAKING MACHINE
64
July, and then Ford, also for the first time, received the title of
president.
11
Later Malcomson made an effort to re-enter the picture. His two
friends, Fry and Bennett, were indignant over the fact that the Ford
Manufacturing Company was sold soon afterwards to the Ford Motor
Company for $450,000. They decided to pull out, and it was Mal
comson who bought their shares. 35 As a legal matter, it was highly
questionable if these shares were salable to Malcomson, for each
share bore the provision that if it were sold, it had to be offered
to another shareholder—the provision that kept the Ford Motor
Company a “closed corporation” for decades. 36 And Malcomson
was not then a shareholder.
Ford and Couzens took the position that Bennett’s and Fry’s shares
should have been offered to them, or to other shareholders, and that
the sale to Malcomson was void. A new controversy with Malcomson
ensued.
Couzens in the meantime had gone to Europe to set up agencies
in England, France, Holland, Spain, Italy, Denmark, Germany, and
Russia. In Denmark, he received a jubilant cablegram from Ford:
Malcomson had conceded that the Fry and Bennett stock had to be
sold to Ford and Couzens, at five dollars a share for the thousand
shares. 37 The Malcomson “trouble” was over, forever.
A little later Couzens bought all of Strelow’s shares for $25,000.
He succeeded Malcomson as a director and treasurer, and then also
assumed the title of general manager. The recorded ownership of
the company stood:
Henry Ford
585 shares
James Couzens
110
Gray estate
105
John Dodge
50
Horace E. Dodge
50
J. W. Anderson
50
Horace Rackham

At last Couzens had attained his goal of moving up from the
bottom of the list of shareholders.
12
After this the Ford Times contained as many references to “Mr.
Couzens” as it did to “Mr. Ford.” It seldom mentioned anyone else.


THE REALIGNMENT 65
Everyone close to the company understood that they were the only
ones who counted. Not a few understood something else. “. . .
They used to tell it around the automobile shows and so forth that
Couzens is the brains of the organization. Couzens is the front door.
If you want anything you will have to see Couzens. This went on and
on, without any inspiration from me. . . .” So Couzens himself
said. 38
Actually, that was how Ford wanted things. If anyone came to Ford
about a business matter, he said: “See Mr. Couzens.” 39
Board meetings became perfunctory affairs. “I would not work
for a company where the board did much interfering with actions
or policies,” Couzens said later. 40 In particular, he had in mind the
Dodge brothers, and even Ford. The fact was, if the Ford Company
then had a boss, the boss was Couzens. 41


CHAPTER XI
THE MONEY-MAKING MACHINE, II
In 1907, business in America was generally in a bad way. Mark
Twain said this was because Theodore Roosevelt, the President,
was a “crazy man.” Others said it was because of the financial
manipulations by the “trusts.” Whatever the cause, the country was
gripped by economic panic. The stock ticker even reported that
Wanamaker had failed, which, if true, would have been to many
businessmen like doom itself. It wasn’t true, but Wanamaker’s store
was in trouble and the bold merchant-king himself wrote in his
diary: “Many people think the world is coming to an end so far
as money and business are concerned.” 1
Detroit was not spared. Among others, Malcomson’s Aero auto
mobile company folded up, although not his coal business. To save
Detroit’s supposedly strong Union Trust Company (an institution
to be recalled later) the hat was passed among Detroit capitalists. 2
But the Ford Company was not fazed. Indeed, as other automobile
companies went bankrupt, the Ford Company in 1907 chalked up its
first million-dollar-profit year. In his private notebook, General
Manager Couzens made a pleasant entry.
“Net earnings for 1907, $1,331,371.68. Total sales, $5,773,851.38.
Percentage of commercial expenses to sales, 3% per cent.”
In the next year, Couzens called in the press to make a sensational
announcement. The Ford Motor Company’s capitalization was to
be increased from $100,000 to $2,000,000, or twenty times, to finance
its Model T. 3
2
The Model T was an instantaneous, colossal success. Just why,
nobody could explain. Ugly, noisy, often unpredictable, it had de
fects enough almost to outweigh its draconic virtues. In the begin-
66


THE MONEY-MAKING MACHINE, II 67
ning, it was not even cheaper than several other cars. For example,
when first introduced, it cost as much as the Cadillac. Yet it caught
on as had no other car. In all probability, the answer was that it
came just at the right moment, when Americans suddenly decided
that the automobile was really here to stay. The people wanted cars,
and the Ford Company was able to produce them in undreamed-of
quantities. 3 4
“The first ‘ad' appeared on Friday,” related the Ford Times.
“Saturday's mail brought nearly a thousand inquiries. Monday's
response swamped our mail clerks, and by Tuesday night, the office
was well-nigh inundated.” 5
As a consequence, Couzens directed that the first Model T's could
be distributed only on a restricted basis. Before a dealer could get
a Model T, he had to sell all previous models on hand. 6 Even then,
only one Model T would be shipped to a dealer until all dealers
had been so supplied, and then only if they could show bona fide
sales in advance. 7 Nothing like this kind of “rationing” had ever
been known before.
Quite as astonishing was the announcement of a new production
policy. No longer were customers to have their choice in sizes,
styles, or motors. The Ford Motor Company, henceforth, would
make only Model T's, and only black Model T's. A famous quip
attributed to Ford was: “The customer can have any color he wants,
just so it's black!”
3
The true meaning of this development was explained by Couzens
more clearly than by anyone else. “We standardized the customer.
It was formerly thought that selling started with the customer, and
worked back to the factory. We reversed the process.” 8
And the “standardized customers” responded with a deluge of
orders. Within six months, agents had to be asked to stop sending
orders, for the company's facilities were swamped. 9
Back in April 1907 a fifty-seven-acre site in Highland Park, then
a remote suburb of Detroit, had been purchased against a possible
need for a larger factory. With the demand for the Model T strain
ing production facilities at the Piquette Street plant, that day had
come. What would previously have been a full year's production
was being turned out and sold in one month.
Profits for 1909 totaled $4,452,602; sales, more than seventeen


68
THE MONEY-MAKING MACHINE
thousand cars. Plans were rushed for building in Highland Park
“the largest factory in the state under one roof,” where, for the first
time in the history of the Ford Company, manufacturing was to be
done on a large scale. 10
Only a short time before, when the American automobile editor
Fred H. Colvin, while in England, mentioned that the Ford factory
was turning out as many as ten thousand cars annually, a British
newspaper scoffed: “No manufacturer can possibly build that many
cars in one year; and even if he could, he wouldn’t be able to sell
half of them.” 11
But in fact the Ford Company was already producing and selling,
under Couzens’ direction, almost twice that number.
4
There was, however, one flaw in the almost bewilderingly dazzling
picture: the Selden patent matter. In 1909, this patent was sweep
ingly sustained in the Federal District Court at New York, where
Judge Charles M. Hough ruled that it was “so fundamental and far
reaching as to cover every modern car driven by any form of petro
leum vapor.” 12 It made no difference, the judge said, that Selden
had contrived a delay of sixteen years in the issuance of his patent,
from 1879 to *895. ‘‘He did delay,” wrote the judge. “He was not
in a hurry. . . . Doubtless he appreciated that, if he was ahead
of the times, it was wise not to let his patent get ahead too.” But,
the judge continued, “Selden did not overstep the law . . . the
inventor may use his discovery, or he may not; but no one else can
use it for seventeen years.” 13
This meant that the Ford Motor Company was liable to an account
ing for its profits, and to being enjoined from producing any more
automobiles.
However, in 1911, the Federal Circuit Court of Appeals, also at
New York, decided that while Selden had a valid patent, Ford and
other manufacturers were using an “entirely different motor prin
ciple.” To the layman, this is confusing language, but it meant the
Ford Company had not infringed Selden’s patent after all. 14 And
at last, the cloud over the Ford Company disappeared forever.
That year, the company produced thirty-four thousand cars and
made net profits of more than $6,ooo,ooo. 15 Some years later, these
figures might seem ordinary, but at the time they were colossal.


THE MONEY-MAKING MACHINE, II
69
5
The Ford plant really went on a “production” basis. Approxi
mately half of all the automobiles produced in America were being
made there. 16 “Watch the Fords Go By” became a slogan that was
familiar everywhere. In 1913, the Ford production schedule called
for 200,000 cars. By then the assembly-line technique was perfected.
And the money rolled in. Whereas profits had been $ 13,000,000 for
1912, for 1913 they had built up to more than $26,000,000 for the
one year. 17
Husbanding these great sums became a major responsibility for
Couzens, along with his pushing of the sales force. He saw to it that
the company’s surplus was put out properly to earn interest. He
initiated a financial plan that probably had no equal then in the
business world: Ford monies would be desposited in banks for the
specific purpose of being loaned to Ford dealers for buying more
Ford cars. The banks charged the dealers regular rates of interest,
and shared the earnings with the Ford Motor Company, to the en
richment of everyone concerned. 18 It was like a magic circle.
On just the replacement parts for old Fords, huge profits were
made—$800,000 on parts alone in 1912, $5,000,000 in 1913. By 1915,
parts accounted for nearly $10,000,000 in profits.
It is little wonder that John D. Rockefeller himself was astonished,
or that a leading economist referred to the Ford Company as a
“seventh wonder of the world.” 19
As Roger Burlingame has noted, Couzens and Ford (aided of course
by some others, like Wills, Walter Flanders, and Hawkins, as well
as Charles E. Sorensen, who then was still far down the ladder) had
ushered the Industrial Revolution into a new stage of maturity,
although neither of them realized it at the time, for they did little
thinking in such terms. Because of them a whole new economic world
had dawned. 20 In this era, the impact of what they had achieved was
not unlike the impact of atomic energy in a later day.
6
Both Couzens and Ford, of course, became millionaires, and it
happened to them before either was truly aware of it.
Naturally, their living arrangements had changed. Ford had long
since left behind the modest house at 82 Bagley Avenue. By 1913 he
and Mrs. Ford and their one child, Edsel, had moved into a massive,


70
THE MONEY-MAKING MACHINE
forty-five-room, castle-like residence called Fairlane, on a thirteen-
hundred-acre estate at Dearborn.
In the meantime, Couzens had Albert Kahn, the industrial archi
tect who had designed the Highland Park plant, build him a fine
brick house at 92 (later 610) Longfellow Avenue. He also acquired
a farm near Pontiac, Michigan, in the Bloomfield Hills section, and
erected there a large white frame house for a summer home. He
called the farm “Wabeek.” It was an Indian word he found in the
Saturday Evening Post, and it meant “the best place.” “My favorite
relaxation,” he said, “is to go to Wabeek farm. I go about looking
like a farmer, with no one to bother me. My cows don’t talk to me,
don’t ask me questions, nor criticize my way of doing things.” 21
7
He did not forget his family in Chatham. In particular, he wanted
to do something to make his mother’s closing years more pleasant.
He persuaded his father for her sake, if not for his own, to retire
from the coal and ice business and come with his mother to Detroit
to live. He presented them with a comfortable house in Highland
Park, and otherwise saw that they lived pleasantly. Both of his
brothers, Albert and Homer, and his sister, Alice, received “nest
eggs” from him to help them toward financial independence. Rosetta,
of course, needed no such help. That one share in the Ford Company
—her one-hundred-dollar loan—had made her wealthy in her own
right.
By then, his own family included four children, for in 1910 a
second girl, Margo, had arrived. Later, the two sons, Homer and
Frank, and two daughters, Madeleine and Margo, were joined by
another girl, Edith Valerie, called Betty.
The youngsters formed an interesting group, all wholesome and
apparently unspoiled by Couzens’ sudden wealth. It was a long time
before any of the youngsters suspected that “Daddy Jim” was of that
breed, often discussed so admiringly in the newspapers of the period,
called “millionaire.”
8
Nor were his business interests limited to the Ford Company, vast
as it had become. In 1908 he was elected a director of the National
Bank of Commerce of Detroit. Before long, he was also on the
directorate of the Old Detroit National Bank and of the Detroit


THE MONEY-MAKING MACHINE, II 71
Trust Company. In February 1909 he became a banker in his own
right, organizing the Highland Park State Bank, a banking subsidiary
of the Ford Motor Company. He was its president. “I ran it from
across the street, in my office of the Ford plant,” he said. 22
To the annoyance of other Detroit banks, he used his influence
as general manager of the Ford Company to persuade other com
panies to keep deposits in “his” bank. If a company had money com
ing to it from Ford supplies, it would be told that the amount due
had been deposited in the company’s name in an account in the
Highland Park Bank, whether the supplier wanted it that way or
not. The suppliers usually acquiesced.
He accepted two more directorates in 1909: one in the Scotten
Tobacco Company, and another in a new railroad, the Kansas City,
Mexico and Orient—a variation of an old dream of John C. Fre
mont’s, in which he became interested, because its promoter, A. E.
Stilwell, was trying to create a new transcontinental railroad “with
out kneeling to Wall Street.” 23 That appealed to Couzens’ “Single
Tax” and John Wanamaker-like ideas.
In 1911, he became a director of the Detroit Salt Company. He
also went into the real-estate business, through the Highland Park
Land Company. He invested in downtown Detroit real estate, and
erected the Couzens Building on Woodward Avenue. He even
entered the retail shoe business, as president of the Rogers Shoe
Company, though this mainly was to help preserve the estate left
by a brother of Mrs. Couzens.
As suited his status, he joined the Detroit Club and the Detroit
Athletic Club. He contributed, although moderately, to the Re
publican party. The press played up the fact that he endorsed a
Republican candidate for the Michigan Supreme Court. His com
ments on women’s suffrage were solicited. He became active in the
Detroit Board of Commerce and, in 1913, was its president. In short,
he emerged as one of the biggest business names in Detroit, so out
standing indeed that a Canadian newspaper-writer soon would de
scribe him as “this square-jawed, successful, masterful son of
Chatham, Ontario.” 24
Definitely, he had arrived. The promise of the caul had been
realized.


CHAPTER XII
THE CRISIS
Yet the Midas touch left something to be desired for both Couzens
and Ford. In spite of the riches that flowed in on them, in spite of all
the doors thrown open to them, neither was really a happy man.
Both illustrated a fact—that success often is harder to endure than
failure, that it frequently carries with it the greater pitfalls for mind
and soul.
Ford, who was a man of moods anyway, was often listless or de
jected in the period between 1908 and 1913. He constantly talked
about retiring and becoming a farmer. He spent little time at the
plant. “He would come in maybe once or twice a week, and then just
roam around,” said an associate. 1 At one time, in 1913, Ford sug
gested that Couzens take his title—president of the company. “He
said that he did not want to come to the office at all,” Couzens re
called, adding, “I told him that we were getting along all right as
we were.” 2
2
On two occasions, Ford even seriously contemplated selling the
Ford Motor Company, once in 1908 and again in 1909. 3
The first occasion was in connection with a merger plan set in mo
tion by Ben Briscoe and William C. Durant, whose idea was to es
tablish one big company, through consolidation of Ford, Buick, Reo,
and Maxwell—then the leading producers. They had sounded out
Couzens on that proposal before 1908. In his 1907 notebook, he had
set down an interesting item:
Sell $5,000,000 preferred Ford $7,125,000
6% common?
Bonus 2,500,000 common Buick 7,125,000
Reo 7,125,000 Maxwell 6,125,000
$35>5 00 ' 000
7*


THE CRISIS
73
3
This tabulation summarized a tentative agreement: A $35,000,000
corporation was to be organized, shares to be distributed in propor
tion to the value set on each company in accord with Couzens' nota
tion. Extra stock was to be distributed ‘‘mostly to the men who were
doing the trade, as a consideration for keeping out of business and
not lending their name to any other automobile." 4 This, specifically,
included Ford.
Throughout the first six months in 1908, Couzens and Ford were
in frequent conferences on the proposed merger, both in Detroit and
in New York. An initial meeting was held at the old Hotel Pont-
chartrain in Detroit, where the principals discussed such questions
as: ‘‘How was the (new) company to be managed?" ‘‘Who was to be
the ‘boss'?" ‘‘How were the different companies to be represented?" 5
Other meetings were held in the Wall Street law offices of Herbert
L. Satterlee, attorney for Briscoe, and a brother-in-law of J. P Mor
gan. ‘‘We expected to get the capital to buy out Ford and to acquire
other property and start the consolidation going from J. P. Morgan
& Company," Satterlee recalled. ‘‘Fords and Olds were planning to
get out of the business." George W. Perkins, a Morgan partner, se
lected a name for the new company—‘‘The International.” 6
But these negotiations reached an impasse after Briscoe unex
pectedly took the position that his company, Maxwell, was being
undervalued. Ford then insisted that he had to have at least $3,000,
000 ‘‘in cash," in addition to stock. This set off Ransom E. Olds, who
declared that if Ford was to get cash, he wanted an equal amount. 7
Then Ford presented another problem. He would not, he said, agree
to subscribe to stock in the International above his merger holdings.
Durant summarized the development:
This was a great surprise and the bankers who were expecting
a large subscription from Mr. Ford were quite disappointed . . .
Mr. Satterlee was quite put out and, after giving the matter a few
moments thought, went back into the other room and very diplo
matically stated that there had been a misunderstanding, that the
matter of finance was entirely up to the bankers and when they
had perfected their plan, another meeting would be called. 8
The bankers never called another meeting. Durant went ahead
to form a merger of his own, which became the General Motors Cor
poration. 9 And Ford and Couzens returned to Detroit to preside
over the birth of the Model T.


74
THE MONEY-MAKING MACHINE
4
Then, in September 1909, Ford heard about the adverse Selden
patent decision and reacted gloomily. “He was in a very serious frame
of mind,” said Horace Rackham. Coincidentally, Durant was having
trouble with his General Motors Corporation. Acquisition of a “go
ing” property such as the Ford Motor Company would be “a way of
getting out of a bad hole.” 5 * * * * 10 Could the Ford Company be purchased
despite the Model T’s success? Theodore McManus, the financial
writer, told Durant that because of the Selden case it was possible.
Later Couzens confirmed this, saying to Durant:
Mr. Ford is very much concerned about the Selden patent suit
and its outcome. The prospects of winning or losing the case are
equal. To lose, means the payment of a very large sum of money.
He is not a member of the license agreement and, on general prin
ciples, has opposed the right of any man to control this patent situa
tion. General Motors, with its several companies holding licenses,
would probably be able to make a very satisfactory adjustment with
Selden if it owned the Ford Company. 11
Durant had another talk with Couzens just before Couzens and
Ford went to New York to discuss with lawyers the adverse Selden
decision. “I told him frankly that the General Motors would like to
acquire the Ford Motor Company and asked him if he would talk
the matter over with Mr. Ford,” said Durant. 12
It was arranged that Couzens and Durant would see each other
again in New York. They did so at the Hotel Belmont on October
5, 1909. 13 Ford did not meet with Durant this time, for he was “sick
in body and disturbed in mind,” as Couzens later recalled, 14 and he
told Couzens to carry on the negotiations. When Couzens and Du
rant were talking, Ford was lying on the floor of his hotel room,
suffering from lumbago. 15
5
Part of the new proposal was that Couzens would increase his
holdings in the Ford Motor Company from 11 to 25 per cent, so
that he would own a porportionate share in the new General Mo
tors. For the most part, this was to be Couzens’ compensation. Ford
was to have his payment in cash. He was to retire entirely from
the automobile business, although with the right to engage in making
tractors. 16


THE CRISIS
75
Couzens told Durant:
Mr. Ford will sell the Ford Motor Company for $8,000,000 giving
me the privilege of purchasing 25 per cent of the company’s stock,
which I am prepared to take over, as part compensation for service
rendered. The balance of the purchase price, the remaining three-
quarters interest of $6,000,000 to be paid for as follows: $2,000,000
cash at the time of the sale, the remaining $4,000,000 at 5 per cent
interest due on or before three years. Mr. Ford to have his propor
tion of the annual profits on the stock which he carries until paid for
and delivered. 17
Couzens then returned to the hotel room and reported on this
proposal to Ford. “Tell him he can have it, if the money's all cash!"
Ford shouted from the bathroom. “Tell him also, I'll throw in my
lumbago!"
“He’s gone. He’s coming back tomorrow for an answer," said
Couzens, adding the question: “You want to let it go for that?"
meaning $8,000,000.
“What do you think?" asked Ford.
“I’d say yes," said Couzens.
“If we get cash," Ford said.
“Cash, or the answer is ‘no,’ ’’ agreed Couzens. 18
But later a part-cash, part-notes proposal was agreed upon. 19
Durant received a written option for the Ford Company. 20 On
Sunday, October 24, 1909, both Ford and Couzens met Durant se
cretly at the Ford plant to check the inventory. 21 Two days later
the General Motors board of directors formally ratified the purchase
agreement. 22 All that remained was for Durant to raise $2,000,000.
Frank A. Vanderlip, president of the National City Bank, agreed to
get the money for him. But when the loan committee of the bank
vetoed Vanderlip’s plan, Durant failed to act upon the option. 23 And
the Ford Motor Company was again saved by bankers, although
somewhat obliquely.
6
The question may be asked: Aside from his concern over the Sel
den matter, what was troubling Ford so profoundly that he would
have abdicated? Undoubtedly some of the explanation is to be
found in the peculiar status Ford then held in his own company.
Until the success of the Model T, the Ford Motor Company was


THE MONEY-MAKING MACHINE
76
really more Couzens than Ford. The important aspects of the com
pany were business, sales, and financial matters. Not until after the
Model T came out did production matters begin to come to the fore.
It was no wonder that Ford spent little time in the office that went
with his title of “president.” There was little for him to do there.
One executive of those days remembered only one occasion when
Ford spent many hours in his office. Ford was toying with the idea
of preparing a book, and was dictating his ideas to a stenographer.
The subject was birds. 24
7
Couzens was no better satisfied with his own role in the company.
His association with the Ford Company, rich as it had made him,
had become a source of frustration, for the Ford Company would
always be just that—“the Ford Company” and not “the Couzens
Company”—no matter how important he was within it.
In view of Couzens’ whole temperament it is plain that this was
becoming emotionally intolerable. His frustration was apparent in
his resistance to letting himself mellow in disposition. He was still
much the way he had been as a boy in Chatham and as the young
freight clerk at the Michigan Central—assertive, often testy, and
aloof. When some acquaintances from Chatham came to visit him
at the Ford plant and greeted him as “Jim,” he turned a cold stare
upon them. “They call me Mr. Couzens around here,” he said.
When Cyril Arthur Player, then a Seattle newspaperman, ap
proached him at a hotel to get material for a story that would help
publicize the Ford Company, Couzens snubbed him: “Newspaper
men! Nothing to say!” In the Ford office one night with T. J. Hay
of Chicago, he embarrassed a clerk by saying: “See that gentleman
there—the only man in the organization who can’t get his work done
when it should be done, in the daytime!” 25
A dealer in Denver, thinking Couzens would be pleased, wrote
that he was preparing a certain report at night, and in longhand, in
order to get it in on time. His response was a curt note: “You should
get your work done on time and have your letters typed. We haven’t
time to read letters written in longhand.” 26
No wonder that nearly everyone in the organization trembled
at the message: “Mr. Couzens wants to see you.” 27
His testiness, especially with representatives of suppliers who
called on him to sell goods to the Ford Company—and invariably


THE CRISIS
77
failed to get orders by the conventional salesman’s flattery and “good-
fellowship”—became proverbial and gave rise to numerous stories,
some true, some apocryphal. One of the more famous of these tales
concerned his reaction to jokes about the Model T. It was said that
when the Detroit News devoted an article to these jokes, Couzens
sent the editor a letter saying: “Sir: I hereby forbid you ever again
to mention the name of the Ford Motor Company in your publica
tion” and withdrew all advertising from the paper, an order which
Henry Ford later cancelled. 28 This story, circulated for years, was
generally accepted as a true reflection of Couzens’ temperament,
though it never happened.
Clearly, Couzens was not a happy man. On the contrary, he was
a profoundly discontented man—an unhappy multimillionaire.
8
On top of whatever ailed him temperamentally, he began to be con
cerned about the possible bad effect of his wealth, a worry resulting
as much as anything from a reawakening of a social conscience, al
though he had not revealed this much since the days of Pingree.
Except for his admiration of Wanamaker, he seemed to have sup
pressed this conscience while engaged in making a success of the
Ford Company. Now it was coming to the surface.
There was a revealing occasion in this connection when his
daughter Madeleine happened to read an article in a newspaper
about his and Ford’s suddenly developed fortunes. “Whew, that’s
a lot of money we have!” He answered her solemnly: “But it doesn’t
belong to us. . . . It’s a trust. It’s a responsibility, and a tough
one.” 29 He really believed this, though the idea would have shocked
a good many of his business friends.
He kept his children on modest allowances. Both he and Mrs.
Couzens deliberately conditioned them to avoid any conspicuous
display of wealth. “I am always annoyed at any sort of display and
have fought against that for years,” he told them.
He took seriously, more than ever, the duties of fatherhood. “It
does not pay to waive all discipline because then no character is
developed. Resistance to temptation is developed by discipline.” 30
Hewing to that line, he was more stern as the children approached
their ’teens than he really wished to be, even with the handsome
older boy, Homer, whom he doted upon particularly. He once
apologized for this. “I am not very demonstrative,” he wrote, “but


THE MONEY-MAKING MACHINE
7 8
I think and keep on thinking of you, and I am perhaps more con
cerned or interested than a parent who is more demonstra
tive. . . .” 31
He strove to build in his children a large measure of emotional
self-discipline. To Madeleine he once wrote a revealing letter:
The measure of your happiness will depend largely on how you
show yourself outwardly. To surrender to every trial or disappoint
ment only weakens your resistance and drives friends and sym
pathizers to the position of unconsciously hindering your recovery
rather than aiding it. Your outward cheerfulness will help you and
help your friends to help you. So buck up, and be my dear little
Pal and chum again. . . , 32
But he himself found it hard to “buck up” under the discontent
that gnawed at him. He was able to deaden his discontent some
what by continuing to drive himself almost savagely in work. Work
was both a medicine to him and a drug. “I am never happier,” he
once said, “than when I am working at top notch, and the only
reason I let down at all is to be able to work at top notch the majority
of the year.” 33 However, by 1913 he faced a crisis in his discontent
so acute that even this medicine failed. To a large extent, this crisis
was precipitated by a drastic change in his relationship with Ford.
P
In the earlier years, he and Ford had been inseparable companions.
Not only had they worked together harmoniously, but there was also
a certain display of friendship between their families. “Henry Ford
submitted to me in everything as far as the business, sales, and
finances were concerned. . . . He was the most perfect working
companion I have ever known,” Couzens once recalled. 34 But after
the golden flood of profits had set in, Ford was no longer “the per
fect working companion.”
No longer did the two “partners” see as much of each other as
they had in the past. As early as October 1912 Couzens informed a
dealer in England, who had inquired about Ford, “I have not been
able to visit with Mr. Ford very much . . . but I hope and believe
he had a most excellent time this summer.” 35 In view of their former
close companionship, this comment and the almost impersonal
manner in which it was made certainly struck a new note. The fact
is, the “partners” did not wish to see much of each other any more.


THE CRISIS 79
They were beginning to rub each other the wrong way. 36 The same
thing was happening that had happened with Malcomson.
Couzens* temperament, notably his desire for independence and
achievement, was, of course, one root cause. But in the main, what
had happened was that Ford no longer “submitted” to Couzens in
everything. Ford had worked through his own discontent by deter
mining to be more aggressive in the company. He shoved aside
thoughts of retiring. To Garet Garrett, Ford made a significant re
mark: “I own fifty-eight per cent of the stock, and I can do with the
company what I like, can’t I?** 37
Also, there was the impact on Ford of the success of the Model
T. In view of the way the company had leaped ahead once the Model
T took hold, Ford could hardly be blamed if he believed that it
was his Model T alone that had made the company. In the words of
Allan Nevins, “Success had given him a feeling that he was almost
infallible.** 38 Besides, Ford was never as disinterested in business
affairs as he had let on. He had his own ideas about how a business
should be operated, as he had demonstrated back in the days of the
Detroit Automobile Company.
Of course, many of Ford’s ideas could not be put into practice
unless plenty of money were available. By 1913 the company had
more money than it knew what to do with. There was no longer
any reason for Ford to hold back in expressing his ideas or insisting
that they be put into effect. He now encroached at times even on
Couzens* domain. With increasing frequency there now occurred
such incidents as this: The manufacturer who supplied many of
the wheels for Ford cars came to Couzens for renewal of his contract.
Couzens declined to renew unless the price were lowered. Ordinarily
that would have ended the matter, but the manufacturer went to
Ford, and Ford signed the contract himself. 39 Couzens was angered.
The period of “See Mr. Couzens” obviously was over.
Ford also had shed the apparent meekness that had attracted
Couzens in their earlier association. He was now almost as symboli
cally authoritarian, in Couzens* eyes, as had been the bearded school
principal in Chatham, and as had been both his father and Malcom
son. When this would become absolutely clear to Couzens, the out
come could be predicted.
There was as well another force at work. Mrs. Ford, “The Great
Believer,” as Ford called his wife, had begun to dislike Couzens.
Possibly this was merely the reflection of a loyal wife’s defense of


8o
THE MONEY-MAKING MACHINE
her husband’s good qualities. In any event, there is evidence that
Mrs. Ford began to resent Couzens’ assumed influence over her
husband and also the general publicity to the effect that Couzens
was the “man behind Ford.” Couzens said that he knew of the talk
against him at the Ford home. 40
In short, many cars had flowed from the Ford plant since that June
evening both had ridden home in Ford’s tiller-steered runabout and
talked of what salaries they would get from “those fellows.”
70
Still another change in their relationship occurred. Ford had taken
to scoffing at the importance of the financial and sales end of the
business. All that was necessary, Ford felt, was to keep lowering the
price of the car, and sales and management would take care of
themselves. He began vetoing carefully worked-out sales and pro
motion campaigns that Couzens had approved. In talks with asso
ciates, he even belittled Couzens’ contribution. 41
Once Ford became indignant when he was asked by an employee
to sign a printed form as a receipt for some item he had requested.
The form was part of a system that had been installed with Couzens’
approval. Ford asked to be shown all of the forms on hand, took
them into the yard of the plant, poured gasoline on them, and
burned them. 42 Whether Ford realized it or not, this act bespoke
contempt for much of Couzens’ role in the company.
For his part, Couzens began to lose much of the respect that he
had had for some of Ford’s mental processes. He continued to recog
nize Ford’s indisputable shrewdness and the validity of Ford’s “com
mon sense” judgments on many things, especially on mass production.
But he found himself shocked by certain points of view taken by
Ford, like Ford’s anti-Semitism and such absurd statements as: “If
you will study the history of almost any crimihal, you will find he
is an inveterate cigarette smoker.”
One of Couzens’ first real jolts came over the way Ford reacted
when Walter Flanders resigned as production superintendent to
join the competing E-M-F Automobile Company across the street
and subsequently “raided” the Ford Company for personnel.
“If you say the word, I will have his head knocked off,” said Ford.
“What do you mean?”
“Oh, I have a couple of fellows who will beat him up.”
“Oh, no,” said the shocked Couzens. “We will stand this without
that.” 43


THE CRISIS 8l
This incident set Couzens to “thinking” about Ford. He con
cluded: “Mr. Ford was not one man, but two men.” 44
As early as 1907, Couzens had received a jolt of another kind, as
later he had reason to recall. He had told Ford of the trouble the
company had obtaining sufficient currency because of the business
panic that year. A few days later, Ford announced a solution: “I am
going to build a vault and take our money out of the banks and
put it in the vault, so that we can pay our men in cash without hav
ing all this trouble with currency.” Couzens said to him, “But this
money is not in the banks! You can not think that money is in the
banks?”
“Certainly it is there,” replied Ford.
Even after Couzens gave Ford a painstaking explanation of the
credit system, he felt that Ford still wanted to try out his scheme
“even if it would wreck the country if everyone followed suit.” 45
On at least one occasion, Couzens delivered a lecture to Ford
for certain of his public utterances: “Look here! You are in a very
prominent position. You should think over some of these things
before saying them!” Ford did not like that.
“Mr. Ford does not want to be influenced or argued with. He
wants to tell people what to do and have them do it,” Couzens later
said. 46
11
Something even more important happened to Couzens in 1913.
He had passed forty, and apparently had come to a kind of cli
macteric in his life, a change for which, as yet, he possessed no
adequate philosophy. All of a sudden, the foundations of his very
existence seemed to drop out from under him. Until now, his exist
ence had meant the struggle to establish himself economically. By
1913 he suddenly realized that this struggle was over. Psychologically,
nothing could be more devastating to the ambitious man. It was
like going blind—or suddenly seeing for the first time. Like many
another businessman, he had measured the worth of the struggle by
money, and now it dawned on him that he had all the money that
he wanted.
“You know,” he said later, “there comes a time when the fun of
making money is all gone. Say what you will, every man deep in his
heart must acknowledge that. . . . The battle is won; the goal is
achieved; it is time for something else.” 47
The idea of continuing to devote himself merely to making more


82
THE MONEY-MAKING MACHINE
money began to produce in Couzens "a kind of nausea.” 48 The
recognition struck him with shattering force that there could be
something more important in the world than producing Ford cars—
or dollars.
12
If not more money, what, then, did he want? He wanted—indeed,
he needed—the constant sense of achievement. This was central
with him, and it was being denied him.
The conviction tormented him that everything ahead for him in
the Ford Company would be repetitious. Ironically, he, the general
manager, was in the same position as the mechanic in the plant who
spent his days endlessly turning “Bolt No. 2” on the monotonous as
sembly line.
The years of climbing had been stimulating. The Selden fight
had been a challenge. The establishment of agencies all over the
world had been exciting and broadening. But from the way the com
pany was going in 1913, he found himself believing that almost any
one could direct it without anything serious going wrong. In this,
of course, he was right. The framework of the Ford Motor Company
had been solidly built. 49 As its later history was to demonstrate, only
a major catastrophe could wreck it, or keep it from growing still
larger, if only from its own momentum. The Ford Company could
even climb back to first place in production and sales, as in the
i95 o, s, after having slipped far down in the 1930’s, and do this
despite the great resources of the giant that General Motors had
become after Durant lost it.
As Couzens pondered the solidity of the company, he concluded
that for him to stay on would mean accentuation of the trouble be
tween himself and Ford, which he would regret. It would also mean
something just as unpleasant—a coasting on past achievement,
which could only heighten his feelings of frustration. “I seemed to
have no interest in life for awhile,” he said. “I had achieved what I
started out to do.” 50


83
CHAPTER XIII
THE FIVE-DOLLAR-A-DAY PLAN
Realization that he faced a crisis in his life plunged him into a
state of self-examination, doubt, discontent, and indecision. He
was at a dead end. He had to give his life a new purpose, or throw
the balance of it away in dissipation, in absorption in trivialities,
or in activity that bored him. He suffered from sleepless nights, and
complained of not feeling well. His doctor recommended that he go
away for a rest. 1 He knew, however, that his trouble was not merely
physical. “Be assured/’ he wrote to a friend, “that when you see me
you will think there is nothing on earth the matter with me, that
I am only four-flushing/’ 2
His trouble was really a result of inner conflict which could be
cured only by making a decision. In July 1913 he took the first
tentative step:
“Notified Mr. Ford of my desire to resign, have office downtown,
or have year’s absence.” 3
Thus did he record in his little notebook the fact that a new
James Couzens was ready to emerge. His money-making period was
nearly over. No longer could he tolerate a career that was in such
contradiction to his primary personality trait—a desire for independ
ence. He had to be James Couzens—not merely Couzens of the Ford
Motor Company.
2
He certainly felt, although often tentatively, that he had to sepa
rate himself from Ford, especially since Ford, who was also ap
parently going through some kind of climacteric, continued to con
duct himself in ways that depressed Couzens. For example, in 1912
Ford had reacted violently on his return from Europe to finding
that C. Harold Wills and others in the plant had put together an
improved Model T. They had worked up a model with longer and


THE MONEY-MAKING MACHINE
84
lower lines—almost streamlined—apparently thinking that Ford
would be pleased. Instead, Ford went into a rage, ordered the car
taken outside, and he “himself helped knock it to pieces.” 4
Among other things, this incident showed that Ford's real trouble
was that he could not bear having anyone beside himself play a
part in the design of the car that bore his name—not even when
they improved it. The Ford had to be his and his alone, and so must
the company—an attitude that inevitably led to antagonism, if still
largely suppressed, toward Couzens.
Couzens sensed Ford's personal problem and there were times
when he went far out of his way to cater to him. Thus, not long
after Ford had gone into his rage over the improved Model T,
Couzens became involved, for Ford’s sake, in a heated controversy
with young Roy D. Chapin, president of the Hudson Motor Car
Company. In the September 28, 1912, issue of the Saturday Evening
Post, the Hudson company had published a double-page advertise
ment which stated, among other things, that its Howard E. Coffin
was “the foremost engineer in the industry.” This was certainly
a harmless puff, the sort of claim Couzens would ordinarily have
ignored. But instead of ignoring it, Couzens sent Chapin one of his
characteristically blunt letters, demanding “to know” how Hudson
could claim Coffin to be “America’s foremost automobile designer”
whereas “I have learned from many sources which are considered
reliable, and which I think you will admit are reliable, that Mr. Ford
is considered ‘America's foremost automobile designer/ ” 5 This
led to an acidulous exchange of letters that merely added to Couzens'
reputation for cantankerousness. But, obviously, his real motive
had been to please Henry Ford.
At times Ford was appeased, but not permanently.
Two events made Couzens postpone action on his decision. First,
the Dodges, also distressed by Ford, had served notice that they
planned to bring out their own car, the Dodge, and that they would
cease making parts for the Ford Motor Company. This produced a
crisis for the Ford Company. Out of loyalty, Couzens decided he
should stay on. Then, while he was talking this matter over with
Ford, Couzens was offered an interesting assignment. At the sug
gestion of John Dodge, Mayor Oscar B. Marx of Detroit asked him
to accept the chairmanship of the Detroit Street Railway Com
mission, only recently created by the city to attain, at last, Hazen


THE FIVE-DOLLAR-A-DAY PLAN
85
Pingree’s goal of municipal ownership of the streetcar lines. 6 Couzens
jumped at this opportunity, and soon became so engrossed in the
municipal streetcar problem that he began to feel that he could
solve his discontent without leaving the Ford Motor Company.
By sheer aggressiveness, he scored a dramatic victory over the street
car corporation. When the corporation refused to settle a dispute
with the city over fares, he issued an ultimatum: “If you do not take
this proposition, we will stop your cars and I will supply one thou
sand Ford automobiles to replace the service.” The corporation
gave in. 7
As a result, when the year 1914 opened, Couzens seemed more
settled in the Ford Company than ever before, for he had also be
come vice-president, the post that John Dodge had given up.
4
He was not, however, the same Couzens. As he groped for a way
to give his life a new direction, he began obviously to look at the
Ford Motor Company from a different perspective. Up to then, the
company had been merely a money-making machine. In Calvin
Coolidge’s phrase, its “business was business,” and nothing more.
Now Couzens began to view the company as a possible social in
strument, particularly in regard to “the labor problem.” Not for
some years had he given much thought to his youthful ideas about
wages and the general position of the workingman. Now those ideas
occupied much of his thinking.
At his clubs, he began to get the reputation of an “argumentive
fellow” on economic subjects, for he questioned the ideas then com
mon among successful businessmen. In part, he was bent on deflat
ing some swollen egos. It pleased him to tell other wealthy manufac
turers bluntly that they were “successful,” not because of “superior
brains,” but because of a direct, or indirect, government subsidy,
or because their labor was “sweated.” 8
In May 1911 as a member of a committee of the Detroit Board
of Commerce, he went to Washington to testify on the effects of the
Payne-Aldrich Tariff Act. He was for revising it downward. So un
orthodox was his testimony that Oswald Garrison Villard, editor
of the liberal Nation, hunted him up at the New York automobile
show shortly afterwards “to see what kind of a freak he was.” 9
Couzens, co-head of the great Ford enterprise, had taken a position
on a great and controversial public issue that, surprisingly, was
the same one taken by Senator Robert M. La Follette of Wisconsin,


86
THE MONEY-MAKING MACHINE
Louis D. Brandeis and other outstanding progressives and liberals
of the period. 10
5
In one major respect, however, Couzens was not yet unorthodox
at all. Wage rates were no higher at the Ford plant than at any
other automobile plant. Indeed, for certain skills, they were even
lower at Ford’s, where janitors were paid as little as seventeen cents
an hour.
In 1911 he did not question the prevailing idea at the Ford plant
that workers should be obtained for the lowest possible wage rates.
But by 1913 he began to examine the concept—in this way respond
ing to the temper of the times.
Woodrow Wilson, who had just been elected President, talked
of “the new freedom” and “industrial democracy.” William Jen
nings Bryan, still a symbol of revolt for “radical” Democrats in the
’nineties, was in Wilson’s cabinet. Many businessmen were dis
mayed. On the inauguration of Wilson, John Wanamaker gloomily
wrote in his diary: “The first entry under the reign of a Democratic
president ... I am unpatriotic enough to want a habitation in
Sicily or Italy for the next four years!” 11
But Couzens was interested in the Wilsonian reforms, even sym
pathetic. He had not voted for Wilson; he had supported the Bull
Moose candidacies of Theodore Roosevelt and Hiram Johnson. Now,
as president of the Board of Commerce, he invited Bryan to make
an address to the board on “The New Era.” Through him, too, Miss
Jane Addams, of Chicago’s Hull House, appeared as a Board of
Commerce speaker. 12
He read crusading, or “muckraking,” magazines like Everybody’s
and Collier’s, which exposed the methods of the “trusts,” and while
he read them, he remembered the Selden patent fight, a personal
symbol of his opposition to monopoly. He began subjecting all
businessmen, especially the most publicized, like Rockefeller, to
critical scrutiny.
6
His real awakening was emotional. During the winter of 1913
the Ford Company ordered some temporary layoffs of factory workers.
He knew that the vast majority of laid-off men could not have any
savings. “All winter,” he recalled, “I sat in my office on the second
floor of the Ford Building and every time I looked out the window,


THE FIVE-DOLLAR-A-DAY PLAN
87
I saw a sea of faces looking up. There were men shivering in the
cold with their coat collars turned up.” This sight haunted him, he
later said.
Another incident occurred that especially distressed him. A crowd
of jobless men had stormed the Ford employment office, and the
police had turned a fire hose on them although they were already
shivering from the cold. 13 He was upset for several days afterwards.
In addition, I.W.W. organizers, seeking to unionize the Ford workers,
were saying things about the Ford management that troubled him,
albeit he “wanted no truck” at this time either with the I.W.W. or
even with milder forms of unionism. 14
He discussed with Ford the idea of instituting a pension plan.
He later said that this occurred to him because of a sentimental
interest in an old man to whom he had given a job in the stationery-
supplies office a few years back. This man, named Bruce, once a
schoolteacher in Chatham, had begged for the job at the Ford plant
after having been forced to retire as a teacher. Now, in 1913, Bruce
was hobbling around as a watchman, but really was too infirm to
work at any job. Couzens was on the point of ordering a pension for
the former teacher. Then he rejected the whole idea as being con
trary to his own concept of independence. 15
Ida Tarbell came to the plant at just this time to gather material
for a book. Couzens discussed his notion of Bruce’s pension with
her. “He says that he thinks it degrading . . . but he also said that
something had to be done,” Miss Tarbell wrote. “His idea was that
the solution should be something which would enable the man
to take care of himself. He said: ‘We have no right in this coun
try to allow conditions that make pensions necessary. I hate the
word/ ” 16
If not a pension, what then? Profit-sharing, or higher wages, or
both? He did not know. But he was sure that employers, including
himself, owed a greater duty to their workers than they had accepted.
In his conversations, he dwelt especially upon the influence of luck
in the economic fate of individuals. He felt keenly that “time and
chance” had been important in his own case, that it was accident
that brought him into contact with Malcomson, and also with Ford.
He recalled his married life, his wife’s illness, and the death of their
first child, and found himself identifying himself with workers in
economic trouble. People who considered him “cold” and “unfeel
ing” would have found this hard to believe, but this is the sort of
man he was becoming. 17


88
THE MONEY-MAKING MACHINE
7
At the Ford factory, meanwhile, certain practical, economic facts
were being explored. The most acute problem of the company was
how to increase productivity without increasing unit costs. The
famous assembly line had been installed, but this by itself failed to
provide a complete solution. 18 It dawned on certain Ford executives
that something had to be done to “improve” labor, as well. They
observed that the workers resisted the speed-up. All too often, Ford
workers quit for other jobs, just after they had been well broken-
in. Quite a large number were discharged by foremen. The result
was an enormous—and costly—turnover in the labor force. 19
This turnover was first spotlighted by a lawyer who had been told
to “look around and see what he could do” about improving effi
ciency. After noticing how often men were being hired and fired, the
lawyer began studying the factory payrolls. In telling of his findings,
Ida Tarbell recorded:
At the end of three months he had some figures. The manager
of the factory said they couldn’t be true. One day, Mr. Couzens
asked the lawyer what he was doing, and he showed him the figures.
They were alarming enough to startle even a stand-pat manufac
turer—to a man like Mr. Couzens . . . , they were a shock and a
condemnation. They showed that to keep a force of x2,000 men,
Ford’s was hiring 60,000 a year. What did it mean? How could it
be corrected? . . . 20
Couzens issued a revolutionary order as a result of the report.
Foremen were to be stripped of their authority to fire. No employee
anywhere in the company was to be discharged unless Couzens or
Ford approved. Even then, no employee was to be fired until he
was tried out in some other department, since it had been discovered
that many men applied for jobs for which they had no training.
“They, of course, say they can do anything. . . . Anyone of us
would do the same if we were out of a job,” Couzens told Miss Tar
bell. 21 Wage studies were then made to “classify” labor according to
various skills, with varying rates. As a result, wages were raised 15
per cent. More studies were made and another revolutionary step
was taken. The working day was reduced from ten hours to nine.
Conditions improved—but not enough.
8
One evening near Christmas in 1913, Couzens was at home reading
a magazine “of socialist tendencies,” as he described it—probably it


THE FIVE-DOLLAR-A-DAY PLAN
89
was Everybody's. He came across an editorial item that seemed to
have a bearing on the labor problem at the Ford plant. The editor
was commenting on a letter from a reader who had asked why, “if
it believed in socialism, the magazine did not practice what it
preached in its own affairs.” The editor answered that progress
had to be universal, that until everyone changed, a single person or
company could not change and survive. “That,” said Couzens, in
telling Miss Tarbell about it, “was an asinine answer!” 22
To B. C. Forbes, Couzens himself told what followed. Forbes
wrote:
An idea flashed through his head. Why shouldn't the Ford Motor
Company take a decided lead in paying the highest wages to its
workers, thus enabling them to enjoy better living conditions? The
company was making money hand over fist and could, therefore,
afford to do something worthwhile. 23
The next morning Couzens told Henry Ford that the basic min
imum wage at the Ford plant should be five dollars a day. He decided
on five dollars because “it's a good round number,” he told Ida
Tarbell. 24
9
Ford raised objections. “We pay as much as anyone pays,” he said.
“But we're responsible for those men,” Couzens said, pointing
to the men outside looking for jobs, “because we don't pay them
enough to live on. . . . We should give our people wages that permit
them to save against the time when we have no work for them.” 25
Couzens mentioned to Ford the incident of the fire hose. “Do you
know that a Russian woman, an anarchist, has been talking to those
unemployed men and advocating that you be assassinated?” 26 He
also pointed out to Ford that the I.W.W. had been making efforts to
“organize” the Ford plant. “Do we want a union to tell us what to
do?” he asked.
He recalled to Ford their talks about pensions and the difficulty
workers had in surviving periods of unemployment. The solution, he
said, was to pay the workers enough so that they could “accumulate
something for hard times.” 27 “We should raise the minimum for
all employees to five dollars a day and charge the difference to our
profit account.” 28
10
Ford continued to object, but Couzens renewed his arguments.
Then he put the whole matter to Ford in the form of a dare. Ford



THE MONEY-MAKING MACHINE
answered that he did not take dares. 29 But Ford did consult his
production assistants, including Peter Martin, the general super
intendent. They could not see the point of an increase as large as
Couzens proposed. Rather, they thought of increases in terms of
“twenty-five cents” or “fifty cents.” 30 In this connection, Theodore
McManus, in his authoritative Men, Money and Motors 31 wrote that
Ford came back to Couzens with the following argument: “Martin
says he is willing to pay three dollars a day. That five dollars a day
will cause trouble. That other firms . . .”
“I know how Martin thinks,” interrupted Couzens. “He thinks
if we pay five dollars a day it will cause a general disturbance in the
labor market. That we will be flooded with requests for jobs. What
if it does? And, what if we are? We’ll get the pick of the workmen
and you know, as well as I do, that a good workman is worth five
dollars a day.
“You and I have talked this over enough—not this plan, exactly,
but some similar plan—and each of us realizes that the division of
our earnings between capital and labor is unequal and that we ought
to do something in the way of relief that is suitable for others. You,
yourself, have often said that is what we should do.”
“Well,” Ford said, “I’ll go back and talk with Martin.”
Couzens pressed for a decision. He knew, he said later, that if
he didn’t get Ford to consent at that time, he would probably never
be able to get the plan through. “If we talk of anything more than
forty-eight hours, we never do it.” 32
Ford came back next with the suggestion that minimum wages
for everyone be increased to three dollars and fifty cents a day.
“No, it’s five or nothing,” said Couzens.
“Then make it four,” said Ford, adding that Martin would agree
to that.
“No,” insisted Couzens, “five or nothing.” 33
And then, Couzens added: “A straight five-dollar wage will be the
greatest advertisement any automobile concern ever had.”
As E. G. Pipp (to whom Ford told this) stated: “Couzens did not
have to say that twice to Ford.” 34
ii
At just this juncture, Horace Rackham came into the office. “The
three of us make a quorum,” Couzens said. “Let us consider this a
meeting.” 35
The results are in the Ford Company minutes:


THE FIVE-DOLLAR-A-DAY PLAN
9 1
Present: Henry Ford, H. H. Rackham, James Couzens. It was stated by
the officers that a plan of better equalizing the company's earnings
between the stockholders and the labor of the company be inaugu
rated. The plan was gone over at considerable length, but briefly it
carried with it, in addition to wages, sums to make the minimum in
come of all men over 22 years of age $5.00 for eight hours work, and
that other increases were to be made to men getting above the mini
mum wage, to maintain the same rate between the minimum, inter
mediate, and maximum wages.
After considerable discussion, it was moved by Director Rackham,
and supported by Director Couzens, that such a plan be put into
force as of January 12, 1914, which plan, it was distinctly understood,
would approximate an additional expenditure for the same volume
of business of $10,000,000 for the year 1914. Carried unanimously. 36
12
It was Couzens, about this time described by a visiting writer as a
man with “the keen, ‘unwinking' blue eyes of the old gladiator,” 37
who made the announcement to the press. The following April, in
Everybody's magazine, Garet Garrett put down his version of the
scene: “Henry Ford was there, with an air of restless detachment from
the business at hand, and stood silently by a window [in Couzens'
office], while Mr. Couzens read the statement he wished the reporters
to publish.'' 38
The statement was an oddity because of the way it reflected an ob
vious effort to divide credit for the plan evenly between Couzens and
Ford.
It was also the best description ever made of the famous wage
plan, which, because it doubled wage rates at one stroke in a great
factory, was indisputably one of the major events of the era, both in
its immediate and in its later impact upon the economic structure of
America. His statement was:
The Ford Motor Company, the greatest and most successful auto
mobile manufacturing company in the world, will, on January 12,
inaugurate the greatest revolution in the matter of rewards for its
workers ever known to the industrial world.
At one stroke it will reduce the hours of labor from nine to eight,
and add to every man's pay a share of the profits of the house. The
smallest amount to be received by any man 22 years old and upwards
will be $5.00 per day. The minimum wage is now $2.34 per day of
nine hours.
All but 10 per cent of the employees will at once share in the
profits. Only 10 per cent of the men now employed are under 22,
and even every one of those under 22 will have a chance of showing
himself entitled to $5.00 per day.


9*
THE MONEY-MAKING MACHINE
Instead of waiting until the end of the year to make a distribution
of profits among their employees in one lump bonus sum, Mr.
Ford and Mr. Couzens have estimated the year’s prospective busi
ness and have decided upon what they feel will be a safe amount
to award the workers. This will be spread over the whole year and
paid on the regular semi-monthly pay days.
The factory is now working two shifts of nine hours each. This
will be changed to three shifts of eight hours each. The number
employed is now about 15,000 and this will be increased by 4,000
or 5,000. The men who now earn $2.34 per day of nine hours will
get at least $5.00 per day of eight hours.
This will apply to every man of 22 years of age or upward with
out regard to the nature of his employment. In order that the
young man, from 18 to 22 years of age, may be entitled to a share
in the profits he must show himself sober, saving, steady, indus
trious, and must satisfy the superintendent and staff that his money
will not be wasted in riotous living.
Young men who are supporting families, widowed mothers,
younger brothers and sisters, will be treated like those over 22.
It is estimated that over $10,000,000 will be thus distributed over
and above the regular wages of the men.
“The commonest laborer, who sweeps the floor, shall receive his
$5.00 per day,” said Henry Ford.
“It is our belief,” said James Couzens, “that social justice begins
at home. We want those who have helped us to produce this great
institution and who are helping to maintain it to share our pros
perity. We want them to have present profits and future prospects.
Thrift and good service and sobriety all will be encouraged and
recognized.”
“If we are obliged,” said Mr. Ford, “to lay off men for want of
sufficient work at any season, we propose to so plan our year’s work
that the lay-off shall be in the harvest time; July, August, and Sep
tember, not in the winter. We hope, in such case, to induce our
men to respond to the calls of the farmers for harvest hands and
not to lie idle and dissipate their savings. We shall make it our
business to get in touch with the farmers and to induce our em
ployees to answer calls for harvest help.
“No man will be discharged if we can help it, except for unfaith
fulness or inefficiency. No foreman in the company has the power
to discharge a man. He may send them out of his department if
they do not make good. The man is then sent to our clearing house,
covering all the departments, and is again repeatedly tried in other
work until we find the job he is suited for, provided he is honestly
trying to render good service.”
“We shall still pay,” Mr. Couzens said, “we are quite sure, good,
handsome dividends to our stockholders, and will set aside rea
sonable amounts for additions and improvements and assembling


THE FIVE-DOLLAR-A-DAY PLAN
93
plants in other parts of the country. And after that it is our hope
to be able to do still better by our employees. We want them to be
in reality partners in our enterprise.
“Believing as we do, that a division of our earnings between
capital and labor is unequal, we have sought a plan of relief suitable
to our business. We do not feel sure that it is the best, but we have
felt impelled to make a start and make it now. We do not agree
with those employers who declare, as did a recent writer in a maga
zine, in excusing himself for not practicing what he preached, that
the movement toward the bettering of society must be universal.
We think that one concern can make a start and create an exam
ple for others. And that is our chief object.
“The public need have no fear that this action of ours will result
in any increase in prices of our products. On the contrary we hope
to keep up our past record of reducing prices each year.
“We may have to make changes in our plan. If hard times should
befall us we may have to reduce or modify our distribution of
profits. But the outlook now is such as to justify this distribution
for the present year.”
“We believe,” said Mr. Ford, “in making 20,000 men prosperous
and contented rather than follow the plan of making a few slave
drivers in our establishment multi-millionaires.”
*3
The appeal of the plan to workers—not to mention social reform
ers—was instantaneous. Mechanics from all over America streamed
to the Ford factory for jobs. The employment office was swamped.
It developed later that the wage plan included some naive, al
though well-intentioned, interference in the lives of the Ford work
ers, such as the following:
Employees should use plenty of soap and water in the home,
and upon their children, bathing frequently. Nothing makes for
right living and health so much as cleanliness. Notice that the most
advanced people are the cleanest. . . .
Improved garbage cans, of which there are several good types
available, should be used. The can should be covered at all times,
especially during the summer time. . . .
From 12 years of age to 18 is especially a time when (children)
should be guarded well, and not allowed to contract habits and vices
injurious to their welfare and health. . . .
Do not spit on the floor in the home. . . .
A double purpose is served under the profit-sharing plan. First,
to provide money for future needs; second, to foster self-control.
The second is the more important of the two, because, having that,
the first is quite assured. . . .


94
THE MONEY-MAKING MACHINE
Avoid, as much as possible, making purchases upon the install
ment plan. . . .
A good understanding should be had between husband and wife
as to expenditures and savings. . . .
Cases have been brought to the company’s attention indicating
that some young men, in order to qualify as profit-sharers, have
hastily married without giving serious thought to such an impor
tant step in their lives. Seldom does such a marriage prove a happy
one. If they would give more thought to the uncertainty of business
affairs and the certainty of the obligations and responsibilities as
sumed in the marriage vows, there would be less work for the divorce
courts. . . . 39
The company sent investigators to the homes of the workers to see
how their beds were made, check their bank accounts, and advise
them on their most intimate affairs. This, of course, was paternal
ism. 40 Couzens deplored this later, although at the time he de
fended it as “simply an effort to show our people how to take care of
their money, how to live and how to get the best out of the in
crease.” 41 He knew the plan “paid off” for the company. He quoted
with approval a Ford worker: “I work for what I get. When I get
three dollars a day and work ten hours, I make 300 bolts. Now, when
I get five dollars a day and work eight hours, I make 900 bolts.” 42
1 4
Ford at the time received all the credit. The reason for this was
explained by Couzens himself:
It was quite natural that Mr. Ford should be credited with this
project because he was the head of the company, a majority stock
holder, and it was to the benefit of the Ford Motor Company that
he should be credited with it; because it gave it a personal touch
which was greatly beneficial in an advertising way and kept the
name Ford much more before the public, and this is great adver
tising. . . , 43
In 1915, he bluntly wrote: “When you get down to the wage
scheme which we started at the Ford Motor Company, I will say that
I, personally, am responsible for it.” 44
It is significant that Ford never claimed, over his signature, that
the wage idea was his. He certainly played his part. As Couzens
frequently said, the wage plan could not have gone into effect with
out Ford’s approval, but Couzens was its sponsor. 45


95
CHAPTER XIV
THE FINAL BREAK
The wage plan proved a good temporary palliative for the tension
between Couzens and Ford. Ford enjoyed being interviewed for
magazines, newspapers, even books. Both Couzens and he obtained
pleasurable excitement from watching how the paternalistic side
of the plan worked, and eagerly followed reports on what was being
done to make certain that the workers “deserved the big envelope.”
While Couzens was in California, a glowing report on this aspect
of the plan was sent to him by Klingensmith, now his assistant. “I
wish you could be here [Klingensmith wrote] just to see the enthu
siasm among the investigators on this welfare work. . . . You need
have no fear that this branch of this work which you started will have
the very best of attention. . . . Mr. Ford has been at the office
practically every day . . . and is very enthusiastic over the work
and puts a lot of enthusiasm into the people in realization of the
possibilities of this profit-sharing plan.” 1
Especially was Couzens pleased because his predictions as to the ad
vertising value of the plan were justified. Sales leaped upward. As
a consequence, he pushed expansion plans, particularly those for
Ford assembly plants in other cities. “The plans for Atlanta are
practically completed. The many questions re Pittsburgh are being
worked out. Indianapolis goes out for bids today. They have started
the plans for Cincinnati and have gotten out a preliminary sketch
for Cleveland.” So Klingensmith summarized progress. 2
Once again, Couzens became the busy, absorbed executive. The
attitude of other businessmen had a stimulating effect on him, for
nearly all other American industrialists and financiers denounced
the plan. 3 Garet Garrett recalled:
The Board of Commerce was in a panic. Smaller manufacturers,
outside the motor car industry, had been serving notice that they


96
THE MONEY-MAKING MACHINE
were leaving Detroit, and several of them did. The owner of the
barber shop at the hotel told me that he would have to go out of
business; even barbers would be wanting five dollars a day. . . 4
"Consternation” was the word Alfred P. Sloan of General Motors
used to describe the reaction of industrialists generally. 5 The pro
gram at Ford, they said, was bound to "disaffect the working class.” 6
The Ford management was described as being in the hands of men
who had lost their minds. 7 Bankers issued instructions to their loan
officers "to watch the credit of 'any customers doing business with
Ford/ ” 8
Couzens became even more interested in seeing it through. "This
is the most interesting subject in the world to me. It is one I can
spend more time and more thought on than any other thing I ever
came in contact with,” he told a friend. 9 Indeed, he became a
veritable crusader for a fairer distribution of the profits of industry.
To E. D. Stair, then publisher of the Detroit Free Press, he wrote:
"It is my sincere judgment that even if a company made only six
per cent, it should divide three among its employees. This would
follow out to the betterment of all concerned.” 10
2
In the following winter, despite the prosperity at the Ford Com
pany, Detroit was gripped by a severe depression, as a result of the
war abroad. Thousands of men tramped the streets in a vain search
for employment. So serious was the situation that the Board of
Commerce organized a committee on unemployment.
Couzens, who a short time before had been president of the board,
watched this committee with increasing skepticism. Its main purpose,
it seemed to him, was not to find jobs for the men but to direct them
to charity. Three days before Christmas, Couzens strode into a
Board of Commerce meeting to speak his mind—
You fellows sit back, smug and complacent, and don’t give a damn
what becomes of your workmen.
You go down to the Board of Estimates and ask for high-pressure
systems to preserve your plants from fire; you ask for more patrol
men to guard your property; but what do you do for your work
men? . . . You kick them into the street, and that’s all there is
to it. . . .
The situation is up to the employers of Detroit. These unem
ployed are sent to charity for assistance, when they want work. . . .


THE FINAL BREAK
97
It is not the man’s fault he has not had enough wages to carry him
over a period like this. Many absolutely refuse to line up with those
seeking charity. They are a part of commerce just as much as we are.
Then what in hell have they to do with charity?
They are just as human as you and I, but they are not as well
taken care of. You can’t give these men work during the summer
and then discharge them in the winter while you take your golf
sticks and go to California, and do your full duty. . . , n
He incurred the lasting enmity of a good number of Detroit
businessmen as a result of that outburst, one that anticipated by
forty years the acceptance by the automobile industry, and partic
ularly by the Ford Company under Henry Ford II, of a form of
guaranteed annual wage system. The Detroit Journal referred to
his as a “commercial Savonarola/’ and what many Detroit business
men called him was unprintable. But his outburst did provoke the
formation of a new committee that obtained jobs for hundreds of
unemployed workers. 12
3
All this eased his relations with Ford. But, again, the easing was
only temporary. True, in the fall of 1914, he told newspaper re
porters that “perfect harmony” existed in the company. “Sometimes
Mr. Ford will drop into my office, as he did this morning, and we
will discuss things for an hour or two. Again, we may not see each
other for a month. But all of the time every part of the immense
organization is running smoothly in its own groove.” 13 However,
within six months after the wage plan had been put into effect, the
old trouble between him and Ford came to the surface again. As
put by one Ford biographer, “Relations between Mr. Ford and his
general manager became more and more strained.” 14 Plainly, all
that was needed for a final break to occur was some appropriate
“incident.”
In August 1914, it appeared that such an incident had occurred.
The war in Europe had caused runs on banks and Ford began talk
ing of withdrawing his personal funds from the Highland Park
State Bank—Couzens’ bank. Couzens assured Ford that his money
was safe where it was. Ford seemed to accept that assurance. He
agreed not to make a transfer. But he ordered the withdrawal any
way. 16 Couzens flared up, and sent the following telegram:



THE MONEY-MAKING MACHINE
August 5, 1914
HENRY FORD,
HARBOR BEACH, MICHIGAN
IN THESE STRENUOUS TIMES MEN INVARIABLY SHOW THE KIND OF STUFF
THEY ARE MADE OF. WE ARE MAKING ARRANGEMENTS TO TRANSFER YOUR
MONEY TO THE DIME BANK.
JAMES COUZENS 16
To his secretary, Henry S. Morgan, Couzens talked about resigning
right then. “You may have to choose soon between continuing with
the Ford Motor Company and staying on with me,” he told Morgan. 17
4
Still the break did not come—this time because of a profound
personal tragedy. On the afternoon of August 8, 1914, he had cut
short a golf game at the Bloomfield Hills Country Club—later he felt
that it was a kind of premonition that caused him to forego the full
eighteen holes—and thus he was at his Wabeek residence in time to
receive a telephone call that sent a chill through him. An automobile
listed as belonging to the Couzens family had overturned on a road
near a small lake close to Wabeek. The driver, a boy, had been
pinned in the water beneath the car. With Margaret, Couzens rushed
to the scene. They found their worst fears confirmed. Their elder
son, Homer, was dead in the Model T Ford they had given to him
on his fourteenth birthday. 18
That evening, although obviously near the breaking point, Couzens
insisted that the family sit at the dinner table as usual. “We must not
give in to our feelings,” he said. Klingensmith called at the house,
and Couzens took him in to see the body. “Wasn’t he a fine big boy?
Wasn’t he a fine big boy?” he kept repeating. But there were no tears.
He simply refused to let them come. 19
Yet he was a man distraught, and he remained so for months.
He thought a motor trip would help, and set out on one with the
family, but he soon turned back. Work, endless work, was all that
made any sense to him. So he clung to the Ford Motor Company, re
gardless of how things stood between himself and Ford.
5
But the break was not to be avoided. Ford had begun issuing vari
ous pronouncements on the war and its meaning for the United
States, statements that increasingly irritated Couzens. He would never
permit his factory to produce war material, not even if the United


THE FINAL BREAK
99
States was involved, Ford said in one statement. In another: “To my
mind, the word ‘murderer’ should be embroidered in red letters
across the breast of every soldier.” 20
Now, Couzens then was also, in a sense, a “peace advocate.” In a
newspaper interview in October 1915, he said: “Mr. Ford and I are
one in our desire for peace. ... I was born in Canada, but I am
absolutely neutral.” 21 When William Howard Taft, Hamilton Holt,
Alton B. Parker, and others formed a “League to Enforce Peace”
Couzens joined and contributed $5,000. 22 So something deeper than
just Ford’s Peace views was involved.
Milton McRae, who was a friend of both men, tried to patch things
up. He suggested to Ford that he employ “a public relations coun
selor,” hoping that such a counselor would steer Ford along a differ
ent path. Instead, Ford engaged a “peace secretary,” a newspaperman,
who, with Madame Rosicka Schwimmer, later came up with the plan
for his famous “peace ship,” the Oscar II. 23 On October 11, 1915,
there occurred the conversation between Couzens and Brownell about
the Ford Times. It was followed the next morning by the decisive
meeting between Couzens and Ford.
7
Klingensmith described the incident as he saw it develop:
On the day that Couzens quit, I saw Ford go into Couzens’ office,
and then come out, and walk down the corridor. A minute later,
Couzens called me into his office. “I’ve just resigned from the Ford
Motor Company. There’s my resignation, right there.”
His face was red, from anger and agitation. He pointed to a sheet
of paper on which he had written his resignation from the Ford
Motor Company, to take effect immediately.
He had written it out in longhand, and given it to Ford, but Ford
had left it on Couzens’ desk.
“I decided,” said Couzens to me, “that I had had enough of his
God damn persecution.”
Then Couzens put on his hat, and walked out of the office. He
went downtown and notified a newspaper friend. 24
The newspaper friend was Jay G. Hayden, then secretary of the
Street Railway Commission (later chief of the Washington Bureau
of the Detroit News.) “About eleven o’clock in the morning,” re
called Hayden, “he came busting into the board room. I thought I


100
THE MONEY-MAKING MACHINE
was to be fired. ‘I’ve just resigned from the Ford Company and I
want your help/ he said to me.
“ ‘On what?’
“ ‘I want to give the story to the papers before Ford does, but I
don’t want to give it out myself/ ”
Hayden then went over to the Book-Cadillac Hotel and called the
various newspaper offices. 25
To Louis B. Block, Ford dealer in Philadelphia, Couzens made an
observation that largely explained the whole matter. “A man some
times gets to the point where his freedom of thought and independ
ence is greater than all else.” 28
8
Years later Couzens learned that Ford had come into his office that
morning to provoke his resignation. As Ford himself said to E. P.
Pipp, a managing editor of the Detroit News:
It's like this. I have had a check kept on him, and he has been
at the plant only 184 days during the past year. He has been in
California and now plans to go to Asheville. I don’t believe in
absentee control. If Jim is on the job, I'd rather have his judgment
than anybody else’s judgment, but Jim’s judgment off the job isn’t
as good as somebody else’s on the job. If a man has a job with us,
he must stick to it. ... I got to thinking about it, stayed home
two or three days to figure it out, and came over to the plant to
make an issue of it. Jim sprang the thing about the article in the
little magazine. Fine, I thought, that’s a dandy way out of it, so I
stood pat. 27
All this was merely a rationalization on Ford’s part. There never
could have been any valid criticism of Couzens on the ground that
he was not on the job. If anything, he had worked too hard at it.
The truth was that Ford had determined to take over, to deal with
Couzens as he had with Alex Malcomson, and the determination had
coincided with Couzens’ own inevitable decision to be on his own.


BOOK TWO
The Mew Public Man



103
CHAPTER XV
THE JOB-SEEKER AGAIN
Even after his break with Ford, Couzens remained a director in the
company, and continued to take an interest in the “social experi
ment” in the Ford organization. He continued to make crusading
speeches to other businessmen. Before the Windsor (Ontario) Board
of Trade, he denounced businessmen who paid low wages to girls
and then headed “committees to save women from prostitution.” “I
have no use,” he said, “for the man who works a lot of girls at $3.50
and $4.00 a week, and then puts on a frock coat on Sunday.” 1 He
had in mind a millionaire merchant who was known for paying low
wages to female employees and whom he ordered out of his house
when this merchant called on him for a contribution to a home for
wayward girls.
He also retained the presidency of the Highland Park State Bank.
That activity, his Wabeek farm, his investments, and his post as head
of the Detroit Street Railway Commission should have been sufficient
to keep him contentedly occupied. Instead, he became restless and
fidgety.
It seemed for a time that the Street Railway Commission by itself
would provide a cure for what he considered his idleness. During the
previous year, in August 1915, he had stirred up the old Pingree mu
nicipal ownership issue, informing Jere C. Hutchins, the president
of the Detroit Union Railways, that the city should buy the D.U.R.
lines. Hutchins had been astounded when Couzens called him on the
telephone to make the suggestion. “It has seemed to me that the
people are satisfied with conditions as they are!” Hutchins said.
“Not at all!” Couzens said. “What is wanted is municipal owner
ship. What do you want for the lines?” 2 So he forced the issue—and a
municipal election on the question.


104
THE NEW PUBLIC MAN
2
A referendum on the question was set for the following November.
Couzens threw himself into the campaign to get Detroiters to vote in
favor of the proposal. Victory would mean a satisfying and ready
made job for him, for he would be the manager of the city-operated
streetcar system if the referendum proposal carried. With his own
funds he financed the printing of literature that supported the pur
chase of the system. He directed the lawyers in a fight against an ef
fort to have the referendum barred by a court injunction, one asked
for by Clarence Burton, the Detroit historian. “I don’t care about
the merits of this or any other plan,” said Burton. “I want the courts
to say that municipal ownership of street railways is illegal and can
never be had in this city.” 3
The injunction suit was killed, and the issue went to the voters as
scheduled, with Couzens the principal speaker at mass meetings or
ganized behind the proposal. On the whole, his speeches were effec
tive. The spectacle of a multimillionaire arguing for municipal own
ership caught the imagination of the city and it seemed the answer to
the main argument of the D.U.R., that the plan was “socialistic.”
But he had naively committed one serious political error. Shrewd
Jere C. Hutchins had refused to set a price on the D.U.R properties.
Couzens determined to go ahead with the referendum anyway. If the
people voted to buy the lines, the price was to be set later by the
judges of the County Court.
Coached by Hutchins, the opposition immediately raised a power
ful cry: “Couzens is asking the city to buy a pig in a poke!”
Couzens tried to counter this move by announcing that if the price
eventually set by the court was not satisfactory, he, personally, would
re-purchase the lines for $40,000,000, higher than any figure the
company had ever set on its property. But the “pig in a poke” cry
deterred even old-time followers of Pingree from actively supporting
him.
Another handicap was a matter with which Couzens himself was
not involved—at least not yet. The city administration then admit
tedly was corrupt. The police department, especially, was notori
ously graft-ridden. “Do you want such an administration to run the
streetcar lines?” the opposition demanded. Couzens had what sounded
like an effective answer. “The opposition tries to befog the issue by
talking of graft. Well, speaking of graft, how about private business?


THE JOB-SEEKER AGAIN
105
There is more favoritism, more politics, and more graft in private
business—and I should know—than in any city government in Amer
ica. If you can’t run your lines and keep out graft, you are a poor lot
of citizens. What does the D.U.R. care about you? All they care
about is your fares. The streetcar line is by nature a monopoly, and
you should own it.” 4
But this argument was not enough. The referendum lost by three
thousand votes. 5
“I’m in a mess,” Couzens told Jay Hayden that night. “Now I have
to get a job.” 6
The following spring, out of sheer desperation, he organized an
other bank, the Highland Park State Bank of Detroit (later the Bank
of Detroit), and became its president. At first, he was delighted with
the new bank. “I never experienced such joy in my life as I did the
day of the opening,” he told John W. Anderson. But soon he was
forced to recognize the bank for what it was—just another money
making machine. He was still looking for a “job,” a new career.
3
The streetcar question apart, it seemed inevitable that he would
find his career in public affairs. Milton McRae had been urging him
for some time to go into politics. Indeed, in 1913 he had advised
Couzens to accept the Board of Commerce presidency with that in
view. 7 And Couzens clearly was interested even before leaving Ford.
He had set his sights high—on national politics. Thus, after the
failure of the streetcar referendum, he “considered” becoming a can
didate for United States Senator, and some of the newspapers began
printing items to the effect that his wealth made him a natural con
tender against Senator Charles E. Townsend in 1916.
But he dropped the idea when it became obvious that he could not
hope to unseat Townsend. Instead, he served as treasurer of Town
send’s re-election campaign. 8 He believed, naively, that this was the
way to break into politics.
In that same year, 1916, he dabbled in the preliminaries of the
Presidential campaign that developed into the contest between
Woodrow Wilson and Charles Evans Hughes. To Charles B. Warren,
the Republican National Committeeman, he wrote: “I am keenly
interested in the success of the Republican Party this fall.” To prove
his interest, he sent Warren a four-thousand-dollar check for the
party campaign fund. 9 Out of gratitude for this contribution, the


io6
THE NEW PUBLIC MAN
party designated him as a Hughes elector, even though he had been
active in an unsuccessful boom on behalf of Theodore Roosevelt
and had sat conspicuously on the platform at a Detroit meeting
for “T.R.” He was a delegate to both the state and national Re
publican conventions, in opposition, incidentally, to a group from
Michigan that was booming Henry Ford for the Republican nomina
tion for President. 10
4
Before voting time, however, it was a local election that became
more important to him. Mayor Marx, a Republican, was seeking
re-election, and was handicapped by his lax police department.
Marx’s secretary, Edward T. Fitzgerald, called on Couzens to ask
him if he would be interested in becoming commissioner of police. 11
The political strategy was obvious: If Couzens became Commissioner
of Police, the Marx regime could be salvaged.
“It came to me like a flash,” Couzens later recalled, “that here was
my opportunity.” He said he was interested, but on a condition. He
had to have a “free hand without political interference of any
kind.” 12 There followed talks with Marx and John Dodge. On
September 28, 1916, Marx announced that Commissioner John
Gillespie had resigned and that Couzens had taken his place, a
substitution that saved the election for Mayor Marx—and launched
Couzens upon his new career. 13


107
CHAPTER XVI
THE POLICE COMMISSIONER
In the words of Detroit’s semi-official historian, George B. Catlin,
he “immediately began making history’’ as Commissioner of Police. 1
Owing to that penchant of his for saying what he thought, he started
off with a storm. During an interview with the newspapers he was
asked to give his policy on law enforcement, particularly in regard
to the state law forbidding the sale of alcoholic beverages on Sunday.
Instead of repeating what every other police commissioner had said
—that, of course, he would enforce all laws—he was frank. He said
that he had not “made up his mind,” and added:
Certain laws are debatable. It is debatable whether it is right
for a man to have a glass of beer on Sunday. It is not debatable
that when a rich man may have his glass of beer in his club or
elsewhere, the poor man is entitled to the same privilege. Whether
either should be permitted is the question. There are in statute
books and among city ordinances so many obsolete and absurd
laws that it would be foolish for an official to announce that he
intended to enforce the law strictly. 2
He soon learned that it was more foolish for a police commissioner
to be so forthright. “Can Detroit hope for much from a man who,
even before he takes the required oath of office, announces in the
public press that the enforcement of the public law in some regards
is to him a debatable matter?” inquired Judge William Connolly,
the Democratic candidate for mayor. 3
“Is Couzens going to enforce the law passed by the people in
Lansing, or just a little of it here and there, as it appeals to him
personally?” asked one newspaper. 4
A newspaper in Grand Rapids commented: “It would seem as
though it is about time for the state authority to take Mr. Couzens
and the whole Detroit outfit by the ear.” 5
Ministers denounced him from their pulpits.


io8
THE NEW PUBLIC MAN
2
For once, he was indecisive, as a statement he issued showed.
"Neither wets, drys, ministers, politicians, nor the public have any
reason to become panicky because I have not determined what
policies are to be enforced as yet. I do not intend to be driven into a
panicky condition. I know I shall not be.” Which of course meant
that he really was "panicky”—for him.
Then he made a wise decision—to conduct a personal survey of
police conditions in Detroit. Emulating Police Commissioner Theo
dore Roosevelt of New York some twenty years before, he prowled
around the city, night and day. Without revealing his identity, he
talked to policemen, to saloonkeepers, to streetwalkers, and to ordi
nary citizens. He later recalled:
"I found conditions far worse than the public dreamed they
were. The real inside conditions were never known to the public.
. . . The town was wide open . . . gamblers ran as they pleased;
hundreds of houses of prostitution were scattered around, and 1,400
saloons ran all day and all night and on Sundays.” 3 * * 6
He then made the only decision possible for him: All laws would
be enforced.
To Police Superintendent Ernst Marquardt he sent the kind of
order he might have issued as general manager of the Ford Motor
Company:
Effective at once, I want every man in the department instructed
to absolutely enforce all laws twenty-four hours of the day, whether
on or off duty. . . . From now on, I want every law and ordinance
complied with, and this includes specifically the prevention of crime
of all kinds, and the proper regulation of laws, ordinances, rules,
and regulations governing traffic, saloons, pool rooms, and every
other thing that will bring about a clean and decent city. . . . No
excuses will be accepted. 7
3
There was first amazement, then amusement over this order. It
was considered by the "wise ones” ludicrous as well as fantastic. A
police commissioner of a metropolitian city issuing a command
actually calling for complete enforcement of all laws!
To be sure, it was fantastic, in a sense. And of course the Couzens
order was not fully obeyed, for the city was not the Ford Company.
Yet it did bring some results, enough to cause "wise ones” to hold


THE POLICE COMMISSIONER 109
their breath. For example, his order called for the enforcement of
the ordinance against saloons being open on Sundays.
People had said that nobody could enforce the Sunday law, that
the politicians would not permit it. But Couzens enforced the law.
He soon learned, however, that types of lawbreaking other than
violation of the Sunday rules were not so easily uprooted, not even
by the strongest, most Couzens-like general order. “I discovered,”
he said, “that there was a vast difference between running a govern
ment department and manufacturing automobiles. . . . When they
asked me to clean up Detroit, they didn’t mean it. They wanted me
to clean it up and not clean it up. They wanted me to make it nice
enough for the reformers and let it stay rotten enough to appease
the bums.” 5 * * 8
4
His goal, he now said, was “a disciplined city.” 9 No one before
him had ever seriously tried to discipline Detroit, not even Pingree.
The temperament of the city had never encouraged such efforts.
The city’s nonconformism was shown even in the way Detroiters
operated their automobiles, for at that time practically no traffic
regulations were enforced. Perhaps symbolically, during Couzens’
first month as police commissioner, his own automobile was stolen,
to the great delight of his ill-wishers, whose number by then had
greatly increased.
The politicians formed an almost solid opposition. Most of the
city’s forty aldermen were openly hostile. “Why give Commissioner
Couzens everything he wants?” an alderman cried at a council budget
meeting. “To let him hang himself!” jeered a colleague. 10
5
On one occasion, Mayor Marx openly tried to frustrate him. When
Couzens wanted certain legislation at Lansing to strengthen the
police department, the mayor had a representative at the capital to
lobby on the other side—against his own police commissioner. 11
“I learned all the emotions of public service when I was commissioner
of police,” Couzens wrote later to Arthur H. Vandenberg, then
editor of the Grand Rapids Herald. He had in mind such headlines
as these:
“COUZENS FAILS EVEN TO REGULATE MOTORISTS”
. . . “POLICE KEEP RIGHT ON WITH THEIR BUNGLING”


110
THE NEW PUBLIC MAN
. . . “VICE DENS FLOURISH IN HEART OF DETROIT” . . .
“COMMISSIONER COUZENS HASN'T MADE GOOD.”
This hurt. But he concluded: “Nearly all public men who did
their duty had to endure about the same sort of stuff. A man can't
set himself up as a target if he doesn’t want to be hit.” 12 So he held
to his goal doggedly. “He made life miserable for everybody in
Detroit who violated any statute, ordinance, order, edict, enactment,
provision, rule, regulation, or section thereof,” said the writer
William Hard. 13
6
He announced that he was determined to abolish the so-called
red-light districts. This caused a group of reputable citizens to
descend on him to argue that his policy would lead to worse evils.
He answered that they should go to the state legislature and get
prostitution legalized; until then, he intended to enforce the law.
“But our families!” protested the citizens. “They would misunder
stand our motives!” “Well,” he replied, “if you think you can con
vince me that prostitution is all right, you should have no trouble
with your families.” 14
Still another group of citizens visited him to save the red-light
areas. They said they were interested “only in Detroit's welfare.”
To these Couzens displayed a little black book and read off some
automobile license numbers. “Are those your license numbers?”
he asked. Some of the callers admitted that they were. “Well,” said
Couzens, “I have a mind to publish these numbers!” Then he told
his dismayed callers that the numbers had been taken down by in
vestigators from cars found parked in front of some of the more
flashy brothels in the city! 15
In dealing with traffic regulation, he succeeded in stirring up an
even bigger storm than he did by his frankness on the red-light
districts. After becoming convinced that elimination of all parking
in the busiest downtown streets was necessary, he issued an order
to that effect, although warned by the city's law department that
his order exceeded his authority. Business leaders assailed him as
a “czar.” Former Mayor Philip Breitmeyer counseled open re
bellion. 16
The stir was such that the order had to be rescinded. But the very
impulsiveness of his action so dramatized Detroit’s need for some
traffic control that shortly afterward the city council enacted legisla-


THE POLICE COMMISSIONER
111
tion along the lines that he had intended to establish. Thus he be
came the father of the city’s modern traffic code.
7
His biggest storm—actually a serio-comic episode worthy of Gil
bert and Sullivan—began in March 1917, when he decided to bring
into the open a half-secret scandal involving a municipal judge.
“Judge Albert Sellers,” he announced to the press, “is giving blanket
releases to professional bondsmen with the names of prisoners to
be filled in as the occasion arises.” 17 The judge sneered at him.
“Police Commissioner Couzens should quit his job and go home.”
Couzens then issued an order that henceforth the police depart
ment would ignore Judge Sellers’ releases unless they had been issued
in a regular court session. 18 Then the city settled back to await the
inevitable collision. It came very soon afterward when Couzens’
order was enforced in the case of two women arrested as street
walkers. Judge Sellers had issued the pair his usual prearranged
releases. Couzens’ police officers refused to honor the releases. So the
judge issued a contempt citation against Couzens.
Haled into court, Couzens was given the choice of paying a fine
of $100 or serving a thirty-day sentence in jail. He refused to pay
the fine and was taken to jail. 19 Of course the city howled, either in
indignation or with delight. The city’s multimillionaire police head
locked up in his own jail! Not even Teddy Roosevelt had endured
such an experience in his similar efforts to clean up a crime-ridden
city.
Couzens did not remain long in his own jail. But the incident did
win for him the favorable public opinion that a bad press had denied
him. He carried this fight with the judge to the State Supreme Court,
and won a decision that outlawed the practice of giving blanket
releases. 20
8
For a time this civic comedy made him a hero. But his troubles
were not over. That spring the United States entered the European
war. The city filled up with “floaters.” Crimes increased—and
Couzens was blamed. The Detroit News, usually his supporter, said:
“The present condition cannot continue. If Mr. Couzens is responsi
ble even in part, it is preposterous that he be kept in his place. . . .
Certainly the stubborn pride of any one man or any group of men


112
THE NEW PUBLIC MAN
cannot be permitted to result in perpetuation of this reign of
terror. ,, 21
The situation really was impossible. There was one face-saving
avenue of escape open to him—to take a war job in Washington,
and thus get out of the police “mess.” Just at this time, General
George W. Goethals, then Acting Quartermaster General of the
Army, invited him to Washington to talk over a proposal that he
become head of a new motor-truck division of the war department. 22
This was the result of a recommendation Milton McRae had made
to the Secretary of War, Newton D. Baker, that Couzens be brought
into the national picture in some wartime capacity. He and Goethals
got along very well. Goethals* greeting to him was: “So! You are
Couzens! They tell me you are a hell of a hard man to get along
with. Well, I am too!” 23
But while Couzens was negotiating with Goethals, the politicians
at home had the City Council pass a resolution requesting his re
moval. The resolution said that the crime wave was a result of his
“incompetency,” and directed Mayor Marx to remove him, “in order
to restore confidence in our city and for the protection of our homes
and our loved ones.” 24 Couzens immediately returned to Detroit
to face his opponents. “The politicians want me to quit because I
will not grant them special privileges. They can’t remove me,” he
announced. 25 He was not removed.


CHAPTER XVII
THE ODD CANDIDATE
“The first thing you know, Jim, you will be a national character.
Remember that Theodore Roosevelt started his career as police
commissioner of New York City. Incidentally and confidentially,
let me tell you that William Alden Smith will not be a candidate
for United States Senator again two years hence. What's the matter
with Jim Couzens for his job?” 1 So Milton McRae had written him
in November 1916.
Couzens was skeptical then. “It is one thing to receive an appoint
ment to a public office, and another thing to get elected. I make
such a poor public showing that I doubt if I could be elected.” 2
By 1918, however, on the basis of his eventful record as police com
missioner, he began to believe he might be a successful candidate
after all. 3
In April 1918 the Detroit News reported “a real Couzens boom
for the Senate” was “getting definite,” but that there was an odd
fact about it. The Couzens “boom” was being openly promoted by
John Gillespie, the discredited former police commissioner. The
News commented: “The boys think that Mr. Couzens as a police
commissioner would make a wonderful United States Senator. They
have taken him to their bosoms to get him off their backs.” 4
2
To Couzens patriarchal Senator Smith then gave some “candid”
advice. He would make “a good senator,” but he would “find great
difficulty in being nominated and elected.” For he had never done
anything to get the party obligated to him. “And that was a hard
handicap.” 5
Deciding this was sound, Couzens withdrew his name from the
senatorial race, in which the contenders by then included Commo-


ii4
THE NEW PUBLIC MAN
dore Truman H. Newberry, Governor Chase S. Osborn, Editor
Arthur H. Vandenberg—and Henry Ford. “I have been advised by
counsel,” Couzens said, “that my continued ownership of Ford Motor
Company stock disqualified me for the Senate because the Ford
Company is engaged in making war materials for the government.” 4 * 6
Of course, this reasoning also applied, as Couzens well knew, to Ford,
though Ford ignored the thrust and became an active candidate
for the senatorial nomination, not only as a Republican but also
as a Democrat.
That same year, Detroit had adopted a new charter, mainly in
order to get a strong chief executive—something previous charters
had prevented. 7 Shortly after the “strong mayor charter” was adopted,
Couzens made an announcement—he would stand for mayor. His
aim, he said, was to be the first of a new line of powerful mayors
who would give Detroit the kind of government it needed.
3
At first his announcement provoked amusement among the politi
cal experts, even those who were friendly toward him. They said
about him exactly what had been said of Hazen S. Pingree: one so
lacking in political tact and diplomacy could not be elected mayor
of Detroit. John Dodge assured him that he could not be “dog
catcher or coroner.” E. Roy Pelletier, a former Ford Company ad
vertising manager, laughed when Couzens asked him to handle his
campaign publicity. Pelletier did not think it possible to “sell” a
man so lacking in “good fellowship.” 8 Mayor Marx thought “nothing
was funnier,” was certain his police commissioner would make one
of “the oddest” candidates in political history. 9
The Detroit News said:
They say he is arrogant, bull-headed, uncompromising. They say
he has no consideration for other people’s feelings. They say he
would rather refuse a favor than grant one. According to their lights,
they are rigfyt. Toward the special-favor seeking politicians, Mr.
Couzens looks that way because he feels just that way. 10
The News then suggested that Detroit ought to have precisely
that kind of man as mayor.
4
He started his campaign by making a curiously candid admission.
He was not a candidate by “overwhelming requests of my friends,
or anything of that sort.” He was a candidate solely because he


THE ODD CANDIDATE
J1 5
“personally” believed that he would make “a good mayor.” The
new charter said the mayor was to be “the chief executive officer of
the city.” He would be precisely that “without the assistance of any
political boss.”
He drafted a lengthy platform, its most important plank being
a statement on the old Pingree issue of municipal ownership of the
streetcar system. “My plan,” he said, “will be to proceed to condemn
the property of the street railway company so the city may get
possession as soon as possible.” 11
5
Unintentionally, the streetcar company gave him a tremendous
political assist. For the D.U.R. picked just this time to raise fares on
the so-called “Pingree lines” from a nickel to six cents. According
to the company, wartime inflationary costs forced them to do this,
and probably the increase was justified. But in a political sense, it
was ill-timed—for the D.U.R.
Taking advantage of this blunder, Couzens immediately an
nounced that he would institute court action to block the increase
in fares. Then Edward T. Fitzgerald, Mayor Marx’s secretary, who
was working for Couzens, came up with an even better idea. He re
called that in a similar situation in 1895, Mayor Pingree had boarded
a streetcar, offered the old rate of fare, and had been thrown off the
car. Detroiters had rallied to Pingree’s support. 12
Fitzgerald persuaded Couzens to copy Pingree. So in the morning
on August 7, 1918, three weeks before the primary, Couzens boarded
a Fort Street streetcar, dropped only a nickel in the fare box and
proceeded to a seat. “Just a minute!” called the conductor. “The
fare is six cents.”
“I won’t pay it,” said Couzens.
“You’ll pay six cents or you will have to leave the car,” said the
conductor, following the instructions issued by the corporation.
“I’ll do no such thing!” said Couzens. “I insist on my rights.”
The conductor stopped the car and announced it would not pro
ceed unless Couzens got off. Other cars piled up behind and traffic
was blocked, but Couzens refused to get off voluntarily. The con
ductor pushed him off while newspaper reporters and photographers
stood by to record it all. 13
6
The stunt was eminently successful. Indeed, it was too successful.
Hundreds of other Detroiters followed his example. The streetcar


THE NEW PUBLIC MAN
116
company met the rebellion by stopping all cars, with the result that
there was rioting all over Detroit. Of course, many citizens were
outraged. And among them was John Dodge, Couzens’ successor as
president of the Street Railway Commission. Dodge accused Couzens
of “encouraging the thousands of Bolsheviki and Anarchists in the
city.” “He ought to be put in jail!” Dodge cried. 14
Although Couzens too was dismayed, he shrewdly said nothing,
counting on the rioting to subside. When it did subside, most
citizens decided that he had won a victory for the car riders, for
the company abandoned the increase in fares.
In the primary, Couzens led all the other candidates, running
ahead of Judge Connolly, who had Democratic party backing, ahead
of Ex-Commissioner Gillespie of the Marx-Republican machine, and
ahead of Divie B. Duffield, a respected lawyer who had drafted the
new city charter.
The following November a runoff between Couzens and Connolly
was held. Again he defeated Connolly, and became Detroit’s new
mayor. Of considerable additional interest to him then—and of
great importance to him later—was the fact that the same night's
election returns showed that Ford, running as a Democrat, in the
senatorial election, had lost a bitter contest with Commodore New
berry, the Republican candidate.


117
CHAPTER XVIII
THE STRONG MAYOR
“I am by nature somewhat more destructive than constructive,”
Couzens had said back in 1915 in a burst o£ self-analysis. 1 What he
really meant was that he received pleasure out of challenging ac
cepted patterns of conduct that did not jibe with his own strictly
disciplined moral code. This is the way he had performed his job
as police commissioner, and as mayor he followed the same course.
“I will conduct myself so that I have my own self-respect, regardless
of whether people like me,” he announced. 2
He was aware of what some people said about him, that he “had
ice water” in his veins, as he once put it. 3 He was caricatured as
“King James.” He felt that he was “probably the loneliest Mayor
any big city ever had,” because he did not “grant favors.” 4
But he proved to be the answer to Detroit’s wish for a strong
executive. Actually, even in the opinion of some who had professed
a desire for a non-political mayor, he was too strong—stronger than
Pingree, stronger even than big-fisted old Zach Chandler, mayor of
Detroit in the 1850’s and later a boss of the national Republican
party in the time of U. S. Grant and Rutherford B. Hayes.
2
He did not share the view that a man in public office must, if
possible, act in an ingratiating manner toward everybody. Rather
he conducted himself in accord with his own code. He might have
ingratiated himself, for example/with Senator William Alden Smith.
President of the Grand Rapids Savings Bank as well as owner of the
influential Grand Rapids Herald. Senator Smith had asked him, as
“a great compliment to me,” to place a deposit in the Smith bank.
This would have been a nice gesture on Couzens’ part, especially
since he wanted Smith’s good will, as well as that of Vandenberg,


THE NEW PUBLIC MAN
ll8
Smith’s editor. But Couzens bluntly turned down the request. “I
cannot afford to carry any money on deposit,” he wrote Smith, citing
local taxes. 5 The incident was but one of many that caused his friends
to bemoan his “political dumbness.”
Just as typical was his response when an employer telephoned
him one day for a police squad to “chase away some strikers,” com
plaining that the pickets were calling him names.
“What are they calling you?” asked Couzens. When the man told
him, he replied: “Oh, I’ve heard you call your workers the same
names!”
He refused the request. 6
3
He began almost every day by handing over to his secretary a
list of automobile license numbers to be sent to the police depart
ment—license numbers on cars which he himself had observed
breaking traffic laws as he drove to City Hall. 7
He did not even hesitate to lay down the law to newspapers, as
in the following letter:
November 1, 1921
Detroit Journal
Detroit, Michigan
Gentlemen:
One of your delivery wagons deliberately parked double just west
of Wayne on Congress this morning. The car was left unattended,
blocking traffic. This kind of disregard for law must be discon
tinued, otherwise the driver will be arrested.
Very truly yours,
James Couzens, Mayor. 8
4
Because he always said forcefully just what he thought, regard
less of diplomacy, he stirred up even more tempests as Mayor than
he had as Police Commissioner. When the Detroit Board of Com
merce opposed his plan for improving a municipal hospital, object
ing to the expense, he let fly the statement that the Board leaders
were a “pack of curs.” 9
He threw the City Council into an uproar by shouting “Liar!” at
the president of the Edison Company during a discussion of utility-
company profits, and found himself “banished” from the council
chambers because of the outburst. In answer, he announced that he


THE STRONG MAYOR
119
would seek the impeachment of the respected and venerable presid
ing councilman, James Vernor, the ginger-ale magnate, who had
ordered Couzens to “mind his manners.” 10
He even provoked a near fist-fight with an old friend in the
council, John C. Lodge, being too quick, as he himself later admitted,
to voice the charge of “sell-out.” 11
He antagonized nearly all of the medical profession in Detroit
and Michigan when, over the protests of the medical societies, he
invited Dr. Adolf Lorenz of Vienna to Detroit to use the Lorenz
treatment on children with infantile paralysis. When the doctors
refused Dr. Lorenz the facilities of the private hospitals, Couzens
opened the municipal hospitals to him, the while denouncing the
doctors for “un-American intolerance.” 12
5
Well-wishers urged him to exercise greater restraint, to be more
affable, even with his critics. His old hero, Pingree, had not been
affable, he answered. “I recognize the desirability of composure . . .
but sometimes it takes an explosion to cause action to be taken to
prevent a repetition of what causes the explosion.” 13
But while his temperament provoked a great deal of controversy,
it produced much positive good for the city of Detroit. He completely
transformed the shabby atmosphere that had prevailed in the mu
nicipal offices. After his first ten months in office, an unfriendly
newspaper had to concede that he had brought into the City Hall
“business dispatch, confidence, and decorum. . . . Since the first
floor front of the City Hall became his home, scandal has become
a lost word in the municipal lexicon. Not a hint of bossism, bargain
ing, political debt-paying.”
The Board of Commerce, with which he was almost continually
at loggerheads, also had praise for his non-political administration.
“Couzens’ favorite campaign phrase was ‘I’ll reward no friends and
I’ll punish no enemies.’ He kept his word. His appointments were
made on merit—he paid no political debts,” said its official publica
tion. 14
City functionaries of long standing who had never before seen any
mayor in their particular bailiwick, now saw Couzens frequently.
The first person to enter the City Hall and the last to leave, he
almost literally wore out stenographers with the amount of corre
spondence that he insisted on handling. 15


120
THE NEW PUBLIC MAN
Veteran officeholders were astonished to discover that when he
called something to their attention, he expected to hear that the
business had been transacted immediately. “If he did not get a re
port promptly, we got a request for a report; that had never happened
before in the City Hall. ,, 16
On a holiday, a subordinate found him at his desk as usual, and
asked, “Why do you work when everyone else is out playing?” “I
have to make good on this job,” he said. 17
6
From the time he had come from Chatham twenty-eight years
before, Detroit by then had grown fivefold in population. It was
then a city of nearly a million persons, the fourth city in America.
Since 1915, it had doubled in area, mainly under the pressure of
the automobile industry he had helped to build. Yet only slight
efforts had been made to keep even the basic municipal services
in line with the city’s growth. In 1919 the city still had the same
sewer and water installations that had been insufficient when Detroit
was half the size. Schools were overcrowded, with thirteen thousand
children on half-time schedules. Public hospital facilities, parks,
and playgrounds were lacking. The main thoroughfares were narrow,
traffic-choked, and studded with bottlenecks and deathtraps. 18
Most glaring of all was the city’s continuing deficiency in streetcar
transportation. Always a source of annoyance to Detroiters, as
Couzens well knew from his own first days in the city, the streetcar
system was then abominable, and even the streetcar corporation
admitted as much.
7
To change this, Detroit had long needed bold, energetic leader
ship that would be able to win the people’s confidence. Couzens
did not hesitate to recommend the expenditure of millions of dollars
for the needed schools, sewers, hospitals, and street improvements.
Convinced of his honesty and ability, the people followed his
guidance, and it was his good fortune that within a week after his
election, the Armistice came, bringing an end to wartime restrictions
on materials needed for rehabilitating and extending the city’s
services.
In his first three years as mayor, Couzens directed planning for the


THE STRONG MAYOR
121
expenditure of approximately $243,000,000—an astounding figure
in that period. 19
Under his leadership, Detroit became, in government as well
as in industry, the “city dynamic.” 20 Indeed, it would be years (in
fact, not until Fiorello H. LaGuardia, a strikingly similar sort of
man, became mayor of New York) before all America was to know
another such aggressively constructive mayor of any city in the land.
He eschewed all partisan politics, except when he secretly tried to
play a part in the 1920 Republican Presidential nominations. He
favored the nomination of the old Bull Mooser, Senator Hiram
Johnson of California, then still reputed an insurgent. Couzens
personally paid all of the expense, about five thousand dollars, for
establishing a Hiram Johnson campaign headquarters in New York. 21
The nomination went to another senator, Warren G. Harding, who
soon invited Couzens to visit him at his home in Marion, Ohio, to
“discuss the coming campaign.” Couzens declined. He was too busy,
he said. But his real reason was that Harding, darling of the Old
Guard, was not his kind of man.


122
CHAPTER XIX
THE PEOPLES MAN
It was not merely because Couzens was a ‘‘builder mayor,” nor even
because he was so conspicuously honest and aggressively non-political,
that he became one of the few outstanding mayors in American
history. In all probability, his “disgraceful contemporary,” as he
called Mayor “Big Bill” Thompson of Chicago, outdid him in the
field of public improvements. 1 And, even in those days, there were
other mayors who were honest and non-political. But Couzens was
outstanding primarily because he stood for liberalism and intelli
gence during a period—the aftermath of World War I—that was
characterized by reaction. 2
He frankly favored not less government action, but more govern
ment action whenever he was convinced of the social need—and
this was a full decade before Franklin D. Roosevelt’s “New Deal.”
Indeed, when there was a nationwide coal strike in 1922, he went so
far as to advocate government ownership of coal mines. 3 When an
acute shortage of homes in Detroit developed at the beginning of
his term, he announced that he favored having the city government
appropriate funds for home building, an early suggestion that there
should be “public housing.” “I do not believe private initiative and
capital are able to cope with this situation,” he announced. “Mean
while, Detroit cannot wait. We must have accommodations for these
people. ... I do not see why we cannot float a $5,000,000 bond
issue of five-year bonds to aid workers in getting homes. . . .
Workers would get their homes nearly at cost, and the city would
get the money cheaper than private interests could get it.” 4
He did not drop the idea until lawyers had convinced him that
the city could not go into the home-loan business without changing
the state constitution.


THE PEOPLE’S MAN
123
2
In 1919 and again in 1921, Detroit was hit especially hard by
severe postwar unemployment. Like Pingree, Couzens insisted that
the city assume responsibility for relieving distress, and also for
providing jobs on public works. So many jobless men were put to
work in the streets department, he once said 4 'the streets were almost
disgracefully clean.” Just as openly, he dispensed doles from the
city treasury to needy workingmen’s families. 5
Also like Pingree, of the “potato patches” of the 1890’s, he was
called a “socialist.” His answer was: '‘Human beings cannot be
permitted to starve because of political theory.”
5
Significantly—and oddly, perhaps, to some—only one other man
in the nation received as much attention in the field of unemploy
ment relief as did Couzens. This was Herbert Hoover, the Secretary
of Commerce in Harding’s administration. Then a symbol of liberal
ism in Washington, Secretary Hoover caused President Harding to
call a White House conference on unemployment in September
1921, to which Couzens was invited. 6 As chairman of this conference,
Hoover declared: “There is no economic failure so terrible in its
import as that of a country possessing a surplus of every necessity of
life in which numbers willing and anxious to work, are deprived of
these necessities. It simply cannot be if our moral and economic
system is to survive.” 7 Couzens was delighted with Hoover’s view
point, especially since Hoover specifically endorsed the program
for which Couzens had been called a socialist in Detroit. Later,
Hoover visited Detroit and was an overnight guest at the Couzens
home on Longfellow Avenue. Couzens found Hoover to be “a hard
man to entertain socially.” 8 But there then began, if not a friend
ship, an association that seemingly foretold harmonious relations in
the future, if their paths should happen to cross again.
4
As an advocate of freedom of speech in America, Couzens was
even more commanding on the municipal scene. In New York City,
Mayor John Hylan announced a ban on “unlawful assemblages”
which his police took to mean all meetings of radicals. Emma Gold
man, the anarchist, was hounded from city jail to city jail. There was


124
THE NEW PUBLIC MAN
a demand for rough treatment of strikers and all “labor agitators.” In
most cities, the police complied with enthusiasm. But not in Detroit.
Despite all the postwar hysteria about “Bolshevism,” Couzens deter
mined to uphold democratic procedures.
A test came in the winter of 1919. “Big Bill” Haywood, then the
most publicized radical in America, was billed for a meeting in
Detroit. A statement authorized by the state headquarters of the
American Legion declared: “If Mayor Couzens and the police depart
ment do not intend to prevent Haywood from speaking here, the
American Legion will.” 9
Couzens’ own police commissioner, Dr. James Inches, urged that
the Haywood meeting be suppressed. Dr. Inches argued that if the
Legion intended to break up the meeting, in his opinion the only
solution was to keep the meeting from taking place.
But Couzens said this was cowardice. “As long as Haywood con
ducts himself within the law he can speak.” 10 The Legion backed
down; Haywood made his speech. And Couzens himself was there
to see that he did.
5
Not long after this, A. Mitchell Palmer, Wilson’s Attorney General
and also a candidate for President to succeed Wilson, staged his so-
called “red raids” all over America. 11 In later years, even conservatives
came to view this activity as a shameful, unnecessary “witch hunt.”
In 1930, before the Harvard Law School alumni, Chief Justice
Charles Evans Hughes spoke “with deep concern about inflammatory
appeals to prejudice made by district attorneys and about the brow
beating of witnesses ... in every part of the country.” 12 Yet, at
the time, with the exception of a few senators like La Follette, almost
the only official voice to be raised in America against the Attorney
General was that of Mayor Couzens. When he learned that his own
Detroit police department had cooperated with Palmer’s agents,
and with an assistant U. S. district attorney in Detroit named Frank
Murphy in seizing and jailing supposed, or even real, “reds,” Couzens
ordered the practice ended. 13 “I am not sure that there is any reason
for these raids,” he said. “I won’t be stampeded by federal officials.” 14
He wasn’t, and, at least officially, Detroit resisted the general hysteria.
6
Just before Palmer began his movement to “stamp out Bolshe
vism,” Couzens prepared a noteworthy statement for the Newspaper


THE PEOPLE’S MAN
125
Enterprise Association. He branded propaganda about “Bolshevism''
a disguised effort to halt social progress, the same position vigorously
taken in Kansas by another enlightened Republican, William Allen
White of the Emporia Gazette. 15 Couzens went on:
The makers of dictionaries in the future are likely to have a hard
time defining the term “Bolshevism” as it is being applied in Amer
ica today.
The word is a vague definition applied to almost anything that
disturbs our social viewpoint.
In the typical American metropolis of Detroit, we are confronted
with every phase of the [war] reconstruction problem. But we have
not found it necessary to throttle free speech nor to interfere with
the lawful expression of radical ideas. Criticism of government is
absolutely needful. I am convinced that to attempt to bottle it up
is highly dangerous. Are we to stifle every symptom of thinking by
shouting Bolshevism? . . . 16
Published in newspapers throughout the country under the head
ing “Don't Bottle Free Thinking!” this statement indicated a further
step in his maturing as a public man, one who, often without realiz
ing it himself, had become a people's man. Like Pingree of his own
city, like Altgeld of Illinois, like La Follette of Wisconsin, like Tom
Johnson and Brand Whitlock of Ohio, like Brandeis of Massachusetts,
and others, Republicans and Democrats, who fought for people's
rights, he was following a long-standing American tradition of pro-
gressivism and freedom.


126
CHAPTER XX
THE BATTLE FOR M.O.
Ironically, no one in the Detroit of that period was more often
called a ‘‘Bolshevist” than Couzens himself—mainly because of his
battle to establish municipal ownership of the city's streetcar lines.
He had flatly declared in his inaugural message that Detroit needed
to run its own public transportation system. His blue eyes never
looked more like steel than when he said: “Unless the Detroit United
Railway agrees to reasonable terms by which the city takes over its
city lines, I will be ready to adopt war measures.” If necessary, he
added, he would submit a purchase plan “every six months, until one
was adopted.” 1 For his one idea was to put over municipal owner
ship, no matter what it cost him. 2
Even so, against his deepest personal inclination, he began with a
compromise. He had concluded long before that the best procedure
would be for the city to build competing lines, “start small like the
Ford Company did,” deny any more franchises to the D.U.R. while
letting the old franchises expire, and then sit back to watch the
municipal lines crush out the company lines. But he let the members
of his Street Railway Commission, three amiable businessmen,
persuade him that such a course meant a fight which, they said, would
be “bad for Detroit.” They induced him to go to the voters in a
referendum in April 1918 with another purchase plan—to buy the
D.U.R. lines for $31,500,000, a price to which the D.U.R. had
agreed. They also persuaded him to conduct only a mild campaign,
keeping himself in the background. His commissioners argued: why
stir up the people when the company had agreed to sell and all the
Detroit papers were in favor of the purchase? 3
2
The compromise turned out badly. For one thing, the D.U.R.,
which had ostensibly agreed to the sale, had in fact prepared reams


THE BATTLE FOR M.O. 127
of literature against the proposal and distributed this material at
the last minute. 3 4
But more serious opposition came from Henry Ford. In 1915
Henry Ford had unqualifiedly endorsed Couzens' M.O. plan in a
front-page interview in the Detroit News, saying: “It is one of the
safest business propositions I have ever heard of. I will gladly work
under James Couzens in the street railway matter.” 5
True, Ford’s newspaper, the Dearborn Independent, had carried
an item, just after Couzens’ election, that had belittled Couzens’
streetcar program. But Ford personally had sent a copy of the paper
to Couzens accompanied by this message:
“While I have bought this paper, I am not taking active manage
ment until January 1st, 1919. I do not agree with this article in any
way. My sentiments are to help you in every way.” 6
But despite this, during the last week of the streetcar campaign,
Ford, acting through Charles E. Sorensen, then general manager
of the Henry Ford and Son Tractor Plant, let loose a resounding
blast against the Couzens plan. Everyone understood that while the
statement ripping into Couzens’ plan (which soon was posted all
over Detroit in handbills and printed in full-page advertisements)
bore Sorensen’s signature, it was really Ford’s. Indeed, Ford had
admitted to E. G. Pipp that he intended “to keep Couzens from
getting his way.” “He seemed to feel unusually peevish toward
Couzens that day,” recalled Pipp. Pipp reminded Ford that previously
he had supported Couzens’ efforts toward municipal ownership.
“I have a right to change my mind,” snapped Ford. 7
3
The Ford statement injected a wholly new argument into the
streetcar controversy: electric streetcars are out of date; the “coming
thing” is gasoline-propelled cars; Henry Ford is developing the new
type of car; hence the city of Detroit would be paying $31,500,000
to the D.U.R. for “junk.” 8
Of course, the Ford gasoline streetcar was pure fiction, or little
more than just an idea. In the words of Jay G. Hayden, “The an
nouncement was plainly designed to scuttle the purchase proposal.” 9
Couzens boiled with anger. “What Mr. Couzens said regarding
Mr. Ford could not be presented in these polite columns,” the
Detroit Saturday Night recalled later. 10 Ford came back with a


128
THE NEW PUBLIC MAN
barbed statement filled with sarcastic references to Couzens’ “lack
of mechanical knowledge.” 11
Had this exchange continued, it would doubtless have dawned on
the majority of Detroiters that the “Sorensen statement” was really
an expression of personal feeling and had nothing to do with the
merits of Couzens’ streetcar plan. As it was, the time was too short
for the public to catch on.
As a result, thousands of Detroiters, who otherwise were for M.O.,
voted against Couzens’ plan because they were taken in by the
Sorensen statement. So Couzens lost his second M.O. referendum. 12
4
The Detroit News analyzed the defeat as having resulted from
Couzens having been, for once, too soft. The people were fed up
with inadequate transportation and wanted the D.U.R. treated
roughly. “What they want is to hang the D.U.R.’s hide on the
fence.” 13
Couzens agreed, and bided his time for another occasion when
he could again raise the M.O. issue. It came when a strike, two
months later, halted all streetcar service. He decided that the strike,
ostensibly for higher wages, was really a collusive affair between the
D.U.R. management and the unions to get further rate increases. 14
On the second day of the stoppage, he issued a decisive statement:
The moment has arrived to finish up our dealings with the D.U.R.
I reached that conclusion last night. That conclusion was con
firmed when I left my farm at 5:55 this morning and came to town
and saw how comfortably we were getting along without the
D.U.R. . . . We will order the company off the non-franchise lines
and put our own equipment on the tracks. ... By fall, we can
have cars sufficient to have a fair-sized system of our own running,
or to have forced the D.U.R. to turn over its property at junk prices.
If the Council will cooperate, I am willing to let this end all
relationship with the D.U.R. once and for all. We have been
grasped by this lying corporation until it seems to me that they
have made their final grasp. 15
And to this he appended—as if in answer to critics of his "im
pulsiveness”—a personal note:
“I have reached this conclusion under no pressure and after no
moments of excitement, but after thirty-six hours of quiet thought.”
An ominous postscript, that—for the D.U.R.


THE BATTLE FOR M.O.
129
5
Then the D.U.R. knew it was in for a battle to the finish. It
promptly settled the strike, after Couzens had directed his city
attorneys to seek a court order placing the company in receivership
for failure to render transportation service. 16 Then, suddenly, the
company discovered that it wanted to build numerous extensions
that it had previously refused to consider. Just as suddenly, it dis
covered that it could increase wages without charging for transfers. 17
It started a discussion of subways, and even offered to surrender
its city lines to another company, keeping only its interurban
properties. Or it would deal with the city on a service-at-cost basis
—anything, in fact, to keep the people from accepting the Couzens
proposal for a rival municipal line. 18
Most of the members of the City Council backed away from a
showdown, saying that it would be better to try to get improved
service and, perhaps, a subway, than to start another fight. Couzens’
own street-railway commissioners, all personal friends who had been
appointed because they supposedly favored his program, also backed
away. They said that instead of municipal ownership, Detroit should
adopt the so-called Taylor Plan, a service-at-cost scheme under private
ownership which was being tried in Cleveland.
“Well, gentlemen,” Couzens said to them, “if that’s your con
viction, I’ll have to ask for your resignations.” 19
He then announced a referendum for April 1920 on a bond issue
of $15,000,000 for the establishment of a competing independent,
city-owned streetcar system. 20
Against this plan, the D.U.R. enlisted an army of orators and
sundry propagandists. The Board of Commerce and a special group
of business leaders, led by Alvan Macauley and Henry B. Joy, both
of the Packard Motor Car Company, joined the D.U.R. in its fight.
Even the three friends who had been Couzens’ streetcar commis
sioners openly opposed the proposal. 21 Aided by utility companies in
other cities, the D.U.R. let loose a flood of literature that literally
clogged the Detroit post office. It was estimated that the company
spent $500,000 to defeat the plan. 22 Joining in the attack were not
only those interests opposed to “socialism,” but also those eager to
see a personal setback for Couzens. As Jay Hayden has recalled:
“For years, he had been stepping on sacred toes. If he won this battle,
it was clear that he would be even more firmly entrenched. The


130
THE NEW PUBLIC MAN
myriad of interests that he had thwarted moved as one in a supreme
effort to stop this man. ,, 23
But, luckily for Couzens, just at this time Ford had set his heart
on buying out all of the minority stockholders in the Ford Motor
Company. There had been a good deal of jockeying on Ford’s part
to get the other stockholders, including Couzens, to sell out without
knowing who wanted to buy. Couzens had held out until he could
discover who was behind mysterious offers being made by various
brokers. He found out that the buyer was Ford himself when Edsel
Ford, in September 1919, came to his home and put all the Ford cards
on the table. 24 Unless Couzens agreed to sell, some of the others would
hold back. Couzens was the key to the whole transaction.
At the session with Edsel, Couzens agreed to sell, although he in
sisted on getting a higher price for his stock than the others in recog
nition of his part in the creation of the company. John Anderson, for
one, endorsed this proposal, saying to Stuart Webb, one of the nego
tiators: “If there is anybody in that organization who is entitled to
a little bit more than anyone else ... it is Mayor Couzens. It was
due to his efforts that the company became a success.” 25
The deal was closed for $30,000,000 for his stock, of which $29,
308,857.90 was for himself, and $691,142.10 for his sister Rosetta.
Apparently out of gratitude, Ford then made a truce with Couzens
that culminated in a curious letter which Ford had his secretary re
lease to the Detroit Saturday Night—to correct some “rumors”:
The relations between Mr. Ford and Mr. Couzens during his
association with the Ford Motor Company, or afterward, have at
no time been strained. Both men have ideals wherein they are
desirous of serving the people in the best and most beneficial way,
and each has chosen his method of doing so. I believe as well that
neither one of these men would hesitate to cooperate with the
other if the resulting benefit was for the best of the people.
Very truly yours,
E. G. Liebold,
General Secretary to Henry Ford. 26
Ford now forgot the Sorensen’s “gasoline car” and came out for the
M.O. plan. This time more than 63 per cent of the voters approved
Couzens’ program for municipally owned and operated streetcars.
Couzens immediately gave the order to begin excavation work for the
new M.O. lines—thus starting, at last, to carry out the program first
proclaimed as far back as the 1890’s. 27


*3!
CHAPTER XXI
THE “DAMNABLE OUTRAGE”
Problems remained, however. The D.U.R. launched nine different
lawsuits to try to invalidate the referendum. One suit was even based
on the point that the paper used for the ballots was too thin. 1
Steel for the rails was needed, and no major steel company would
submit bids. The bonds voted in the referendum had to be sold, and
investment brokers boycotted them.
Couzens arranged for the steel by making a personal plea to James
A. Farrell, president of the U.S. Steel Corporation. He met the boy
cott of the brokers by buying many of the bonds himself, and by
using certain municipal funds for buying others. Lawyers argued that
the procedure was illegal, 2 but he went ahead—and was sustained by
the courts. Meanwhile, construction went on.
The tracks of the new municipal lines had to cross D.U.R. tracks
at several points. As the law was then understood, the D.U.R. had the
right to prevent this. Consequently, there occurred another of those
civic comedies with Couzens as script writer.
At midnight on Saturday, January 8, 1921, some two hundred city
workers, under secret orders, converged at the intersection of St. Jean
and Mack Streets. Policemen ringed the intersection to keep out “in
truders/’ and under their protection, the workers proceeded to saw
and hack the D.U.R. rails in two. As expected, the D.U.R. general
manager arrived with a court order commanding that the city work
be halted. He was arrested and taken to a police station on Belle Isle,
where the drawbridge to the island was lifted, so that no one could
get to the park to serve legal orders for his release. By the time the
manager was freed, the crossing had been achieved and city streetcars
began running across the D.U.R. lines. 3
There was an appeal to the courts. D.U.R. attorneys said that the
midnight crossing was “an abominable, damnable outrage.” 4 The


132
THE NEW PUBLIC MAN
lower courts agreed and ordered the city not to use the crossing, but
—and this was the important thing—the city was not ordered to tear
up its tracks. The case was appealed to the Supreme Court of the
United States. The D.U.R. retained as its counsel none other than
Charles Evans Hughes, then marking time between two terms in
the highest court, but even he was not able to save the D.U.R.
In effect, the Supreme Court rendered a decision which supported
fully the "damnable outrage.” 5
2
One more effort was made by the D.U.R. to destroy the municipal
lines. It submitted to the voters a proposal that the city lines be
merged with those of the D.U.R. in a new private company to oper
ate on the service-at-cost principle. This plan offered a number of
attractive concessions to the public. But Couzens presented a counter
proposal—for the city to take over certain D.U.R. lines on which
there was no franchise and which the D.U.R. had no choice but to
sell. In the campaign that followed, the D.U.R. issued a threat. If
its proposal were not accepted, it would take all its cars off the streets.
"We will not be intimidated,” 6 said Couzens, and the voters
supported him in sufficient numbers to kill the D.U.R. proposal
while they approved his own proposal. 7
However, unless the city system could operate on certain D.U.R.
routes—notably those on such main thoroughfares as Woodward
Avenue and Fort Street—the city’s position still was not yet satis
factory. Couzens then asked the D.U.R. to sell its lines on those two
main streets, but, as usual, the D.U.R. refused.
Then it was Couzens who made a threat: He would tear up the
D.U.R. tracks—a weapon that no other mayor of Detroit had ever
seriously considered using—if the voters approved. In an election
of November 1921 the people again stood by Couzens, voting the
ouster authority, at the same time re-electing him mayor for a
second term.
3
Couzens then prepared for the kill, forcing the company to permit
city cars to operate over its lines, with an interchange of transfers.
In effect, he achieved by this a unified car system for the city. 8
Knowing it was licked, the D.U.R. then presented him with the
proposal that the city lease its lines. 9 He refused; his goal was to


THE “DAMNABLE OUTRAGE”
*33
purchase, not to lease, and he knew he had the corporation in his
power. A meeting of the D.U.R. stockholders was called. Having
purchased a share of stock to qualify as a shareholder, Couzens him
self occupied a front seat. He listened to the discussion, and then
stood up. Unless the D.U.R. agreed to sell to the city all its mu
nicipal lines at the price he had already specified, he would carry
out his threat to tear up the tracks on Woodward Avenue and Fort
Street. “This issue must be settled now, in February,” he added. 10
4
On the last day of February 1922 the D.U.R. surrendered.
That April, Couzens presented the voters with an agreement by
which the city would acquire the D.U.R. city lines for $19,850,000.
It was approved—and a month later the D.U.R. lines became a part
of the municipal railway. 11 The long battle for municipal owner
ship in Detroit was won at last. Probably no one but Couzens could
have won it. Considering the stakes, the obstacles, and the bitterness
of the opposition, he had, by his “bull-headedness,” scored a victory
that was unique in the annals of American politics in his or even
later eras. 12


134
CHAPTER XXII
THE REWARD
Couzens' satisfaction at having established the nation's largest mu
nicipally owned railway was “sweeter,” he said, than anything he had
ever achieved in business. 1 Best of all, he had demonstrated beyond
any question that he was his own man. The Detroit News com
mented:
The only way to dictate successfully to Mr. Couzens about any
thing would be first of all to throw him into a deep well and then
to fill up the well with scrap iron and paving bricks. After that, it
is assumed that if you told him to stay there, he might do it. 2
This was precisely the reputation he wanted.
2
Would he now be content to rest on his laurels? Would he be
satisfied to continue as Mayor of Detroit, to run for that office again,
and then call matters quits? No one who really knew him could have
thought so. Close to fifty then, he was still subject to the drive of
ambition that had always marked him.
The truth was that he had never given up the idea of being United
States Senator from Michigan, the highest office to which he could
aspire in view of his Canadian birth, and he seldom forgot that this
was his ultimate goal. In November 1922 there would be another
senatorial election.
Henry Ford had unexpectedly precipitated a political issue that
made it altogether reasonable for Couzens to expect to capture the
Republican nomination from Senator Charles E. Townsend. For
Ford had placed with the Department of Justice evidence that Sena
tor Truman H. Newberry had expended large sums of money in the
1918 campaign. On the basis of this, Newberry had been convicted
of violating the federal corrupt-practice act in a lower court. The


THE REWARD 135
United States Supreme Court had overruled the conviction, 3 but the
issue had been kept alive.
In January 1922 the Senate took up a resolution to expel New
berry. On one side were the Old Guard Republican senators; on the
other, insurgent Republicans, led by La Follette of Wisconsin, and,
of course, the Democrats. Senator George W. Norris of Nebraska
made a powerful, sarcastic speech against Newberry, which began,
“Mr. President, they had a public sale up in Michigan . . .” 4 This
resolution was defeated, but this did not end the matter. Instead, in
the 1922 elections, “Newberryism” became an issue against every
senator up for re-election who had supported Newberry. 5 This was
particularly true in Michigan, for Senator Townsend had defended
Newberry.
5
Here was a situation that seemed made to order for Couzens. No
other nominal Republican in the state so definitely represented the
antithesis of “Newberryism.” Besides, when he had stood for re
election in the mayoralty campaign the previous year, 1921, he had
demonstrated that he was a political force of the first magnitude in
Michigan on his own, regardless of party machinery. If his first
election as mayor could have been passed off as a freak, this was not
so in 1921, for all of his shortcomings, real and alleged, had been
fully aired, and all the people he had offended by refusing to be a
“good fellow” had opposed him. “You are too mean to people to
be re-elected,” his friend Jay Hayden had told him. 6
The business elements generally had been against him. “They op
posed my activities at every turn,” Couzens himself said. 7 Yet he
was handsomely returned to office. “He hasn’t a soul with him—
except the city of Detroit,” said one observer. 8
4
His health, however, finally determined that he would not enter
that senatorial race after all. From the first year of his mayoralty,
his physical condition had become a cause for concern. Just after
his initial municipal-ownership victory, marked by the heavy speak
ing program that had clearly overtaxed him, he began to be con
scious of a stiffening in his left knee. Severe rheumatic pains attacked
him. His leg was placed in a cast and he was forced to hobble about
with a cane.


136
THE NEW PUBLIC MAN
Then his tonsils, considered a possible cause of his trouble, were
removed. For a man of his hitherto perfect health—except for head
aches—he was remarkably slow in recovering from the tonsilectomy.
The stiffness in his leg and the pain persisted. Later, he began to
suffer from severe abdominal pain.
He was operated on again, this time for the removal of a gallstone.
After spending two months in Florida, he seemed to have recovered
his health. But soon he was again operated on, this time for bladder
trouble. His condition became so desperate that it was reported he
was dying. 9 He staged a comeback, only to be subjected to still an
other operation two months later, this time for an infection resulting
from the previous operation.
When he finally did get back on his feet, he was by no means an
invalid. Back at his desk in City Hall, he took on even more activi
ties, adding the active managership of the street railway lines to his
general duties as mayor. He was proud of the way he could still
drive himself. “I get up at 6:30 every morning and hustle to get out
of the house at 8 o’clock. I make straight for my office at the street
railway headquarters and stick on the job there until noon. Then I
change from being general manager of the traction system . . . and
get on the job as Mayor. ... I have never worked so hard in my
life.” 10 But the made-to-order opportunity to be a United States
Senator had slipped by—so he thought.
■5
Actually, the “Couzens luck” was running with him again.
Almost as soon as he had reconciled himself to a long wait before
he could have another chance at the senatorship, the news came that
Commodore Newberry intended to resign from the Senate. His col
league, Senator Townsend, had been defeated by a Democrat, Wood-
bridge N. Ferris. Very correctly, Newberry interpreted Townsend’s
defeat as a rebuke to himself. He also foresaw that when a new resolu
tion for his expulsion came up in the Senate, it would certainly pass.
Therefore, on November 18, 1922, he prudently resigned—“lashed
from the Senate,” in the words of Mississippi’s Senator Pat Har
rison. 11
Governor Alex J. Groesbeck, known as a progressive Republican,
then described the kind of man he would appoint to the vacancy.
He would be “aggressive, and capable of taking care of himself on
the floor of the Senate . . . something besides a mere dispenser of


THE REWARD
137
patronage,” one who would be against “so-called standpatism” and
“have the capacity and courage to do things that will advance the
state and national welfare, regardless of personal and political con
siderations.” This seemed to fit Couzens to a T, except for one thing.
The appointee naturally had to be a Republican. Couzens professed
to be a Republican, but was he?
6
It was widely known that he placed an individual’s stand on public
questions ahead of party regularity. Back in 1918, in response to a
request for a campaign contribution on behalf of Republican Con
gressional candidates, he had told Fred W. Upham of Chicago, treas
urer of the Republican National Committee:
I must confess that I am not so much a party man as I am for
individuals, and, in declining contributions to their campaigns,
I have stated that I would have to know for whom the campaign
was being conducted. . . . There are Democrats that I would rather
vote for than some Republicans, though I am a Republican. 12
Governor Groesbeck was warned against the Couzens “tempera
ment.” The Detroit Times, then owned jointly by William Randolph
Hearst and Arthur Brisbane, commented: “The principal objection
to Mr. Couzens seems to be that he is temperamentally unfitted to
work on a job where he is surrounded by men equal to him in author
ity. He is a lone hand player.” 13
On Saturday, November 25, 1922, Governor Groesbeck called on
Couzens at his home, obviously for a confidential "feeling out” sort
of conversation. Couzens reiterated that he was a Republican, but
he frankly said there was not much about the party’s program at that
time that he approved. The Governor really felt the same way, and
so this was not against Couzens in Groesbeck’s view. As for patronage,
Couzens said: “I hate the very sound of the word.” Couzens made
one concession that Groesbeck accepted as satisfactory: he did “be
lieve” in “party government.” 14
7
Groesbeck had said that he would definitely announce his choice
on the 27th. The 27th passed and Groesbeck was silent. The press
began to mention other available men. Among them were E. D. Stair
of the Free Press, Ralph Booth of the Booth newspapers, and Marion
L. Burton, president of the University of Michigan.


THE NEW PUBLIC MAN
138
As for Couzens, he went about his affairs as usual. He had planned
to spend Thanksgiving Day in New York City with Madeleine, who
was at school there. Besides, Frank Couzens had married Margaret
Lang of Kitchener, Ontario, the previous October 22nd; the newly
weds would also be in New York, and Couzens wanted to see them.
He did not see fit to change his plans. 15
Only a few hours after he and Mrs. Couzens and Madeleine had
settled themselves in the Hotel Belmont on November 29, 1922,
there was a telephone call from Governor Groesbeck. He had been
appointed to the Senate as Newberry’s successor.


BOOK THREE
The Senator



141
CHAPTER XXIII
THE ONE-MAX BLOC
He was a marked man in the Senate from the very beginning. His
career in industry as well as in municipal government, plus his wealth
and his reputation as a fighter formed a combination that caught the
public fancy.
One news service, unaware of his Canadian birth, sent out during
his first month a story to the effect that he was “a natural candidate
for President in 1924.” “If the Democrats pick Ford, the Republicans
are sure to seize upon Couzens as the only man who has a chance to
beat him,” said the story. 1
Indeed, he rivaled in public attention, quite successfully, that dis
tinctive feature of the year 1922—the “flapper.” 2
2
The Washington newspaper writers as a group immediately liked
him, in particular such journalists as Thomas L. Stokes, Paul Y.
Anderson, and Ray Tucker. Many senators were cautious in permit
ting the press to quote them, but not Couzens. Consequently, he was
often good for a “story.” The journalists, especially those of a liberal
bent, flocked to his office. On the basis of one such meeting in his first
week, William Hard wrote: “He is a perfectly non-political type of
person . . . comes close to being the perfect independent.” 3 This
was sound prophecy.
3
He never mastered the art of oratory. For the most part, parliamen
tary procedure was a complete mystery to him. But he worked hard
at his new career, attended every committee meeting, unless ill. He
naively attempted in the beginning to function in the Senate as an
executive, and never fully reconciled himself to the fact that this


THE SENATOR
142
was impossible. Indeed, quite early in his career he remarked to a
colleague: “This senator thing is not my line, and I probably won’t
be here long. There is too much talk, talk, talk.” 4
“He goes for the point like a bullet. He’s a man of strong likes and
dislikes. He’s far from patient. Riled, he manifests it with plenty of
vigor and urgency. Called to order, he effervesces like a shaken-up
bottle of soda water. If you have business with Senator Couzens, make
it snappy. He’s there to transact it, and he’s very accessible, but he
doesn’t want a conversation to drool along. . . . Efficiency, efficiency.
That’s Senator Couzens.” So one observer wrote. 5
In those first weeks, he spent considerable time searching in books
to try to learn what a senator should do and be. 6 Finally, he gave up
the study—and decided to be himself.
4
When he was sworn in by Vice President Calvin Coolidge on De
cember 7, 1922, to become “a real live senator,” as he wrote Mad
eleine, Harding was still President. The Secretary of the Treasury
was Andrew W. Mellon. Many believed he functioned as the real
power of the Harding administration. Charles Evans Hughes was
Secretary of State. Herbert Hoover still headed Commerce. William
Howard Taft was Chief Justice.
In the Senate itself, there was still Henry Cabot Lodge of Mas
sachusetts, a link with an era long past. The venerable Mr. Lodge’s
celebrated whiskers were fading somewhat, but he remained the
grandee of the Old Guard, symbolizing a strong hold on the govern
ment by old line conservatives. As faithful lieutenants in the Senate,
Lodge had James Watson of Indiana, Reed Smoot of Utah, David
Reed of Pennsylvania, George Moses of New Hampshire, and Simeon
Fess of Ohio, all fervently devoted to the policies that President Hard
ing had termed “normalcy.” 7
With Wilson’s party largely in a state of coma after the defeat of
James Cox and Franklin D. Roosevelt for President and Vice Pres
ident in the 1920 election, 8 the Old Guard leaders, for all practical
purposes, were the Senate of the United States throughout the first
half of the Harding era. 9
5
It is true, however, that by 1922, the Republican stalwarts found
themselves confronted with a challenging force, even so. In the Senate


THE ONE-MAN BLOC
143
then were men, mainly Republicans from the West, who appeared
to have been infected with the virus of Populism which many be
lieved had been annihilated in the first Bryan campaign of 1896.
These included Senators Robert M. La Follette, Sr., of Wisconsin,
George W. Norris of Nebraska, Hiram Johnson of California, Wil
liam E. Borah of Idaho, and, to some extent, Albert Cummins of
Iowa, Arthur W. Capper of Kansas, and Charles L. McNary of Or
egon. As the result of a kind of political dust storm in Iowa, the 1922
elections had even turned up a supposedly peculiar Republican who
was pictured as a cross between John Peter Altgeld of Illinois and
Nicolai Lenin—Senator Smith Brookhart, whose middle name was
“Wildman.”
Under Old Bob La Follette’s magnetic personal leadership, these
men had formed a Progressive bloc to make war on the clique around
Harding, the “curious crew,” as Senator Norris called them. 10 Senator
Moses called this progressive group “Sons of the Wild Jackass,” with
Couzens to be included in the epithet. 11
This group contrived at times to stir up heated controversy. They
inveighed against domination of government by big business and
flayed Wall Street and the power trust. They championed the cause
of the western agricultural areas, which somehow did not share fully
in the blessings of Harding’s “normalcy.” They opposed the admin
istration tax policies. And finally, they turned the spotlight on
evidence of corruption that made the Harding regime comparable
to that of President Grant, uncovering a scandal, in the Teapot Dome
oil leases, that rivaled any governmental venality the nation had
known before. 12
William Allen White thought he saw in this Progressive bloc,
mainly Republican, a movement “that portends revolution—not
noisy, bloody and disorderly . . . but a nice, decent, and dangerous
revolution that will take a long forward trek toward economic justice
for those who have been hankering to see something smash some
thing.” 13 This was optimism, for the basic calmness of the over-all
political scene was really little disturbed just then. It would be ten
years before the “nice and decent revolution”—that of Franklin D.
Roosevelt—was to come.
6
Couzens himself was anxious for action. He gave a hint of this by
his behavior when he was sworn in by Coolidge. When his name was


144
THE SENATOR
called, he loped down the aisle so swiftly that retiring Senator Town
send, supposedly his escort, had to hurry to catch up. 14
But the general listlessness of these early 1920’s was a definite
handicap to him. His nature demanded that he strive to be outstand
ing, to leave his mark. The criticism which had been voiced to Gov
ernor Groesbeck that Couzens was a ‘lone handed player” was ac
curate, and therefore he could not wholly identify himself with any
group in the Senate and gain satisfaction from the activities of the
group—much less his party. He had to be on his own. He was at his
best when tackling major problems, as in the case of the streetcar
issue in Detroit. But the Senate as a whole was slow then in facing
up to major problems.
7
As might be expected, he became an almost constant thorn in
the side of his own party. His enemies never said anything more
accurate about him than that he was a Republican “in name only.”
He himself later summed up his partisanship: “I am a Republican,
but not like Harding, Coolidge, and Hoover!” Inasmuch as these
three were the titular heads of his party throughout his senatorship,
a fair question would have been: “Republican? What kind?” A news
paper headline of the period came closest to pegging him properly:
JAMES COUZENS—ONE-MAN BLOC 15
Curiously enough, despite his progressive record as Detroit’s mayor,
he did not immediately commit himself as to which group he would
line up with. But which group could he line up with? The Old
Guard, under Lodge? The Progressives, under La Follette?
One of the first things he did was deliberately to insult Senator
Jim Watson of Indiana by pretending to him that he had never heard
of him before and asking him what party he belonged to. A Re
publican organ in St. Louis reflected Watson’s reaction by observing:
“Evidently, this new specimen of the political fauna from the wilds
of Detroit intends to make it plain that he was formerly associated
with Ford by trying to out-Ford himself in arrogance. It is safe to
predict that he will fade away from Washington just about the same
way as Multimillionaire Senator H. A. W. Tabor of Colorado.” 16
8
Couzens’ first vote as Senator was in opposition to a ship-subsidy
bill, which the Harding clique supported with great fervor. This


THE ONE-MAN BLOC
145
bill was an outgrowth of World War I, during which the government
had acquired a great merchant fleet operated by the U. S. Shipping
Board. The Ship Subsidy Bill of 1922 provided that the vessels “be
turned over to private companies on generous terms and that sub
stantial appropriations be voted to help them operate on a comfort
able margin.” 17
Although it is debatable how well this jibed with the popular
idea that the government should get out of business, it certainly
was good business for the companies that were to get the ships and
the generous subsidies, estimated at $850,000,000.
Along with Brookhart, Couzens caused this bill to be shelved in
the Senate just when its passage appeared near. For he and Brook-
hart obtained enough signatures to a round robin to get the subsidy
measure taken off the calendar in favor of a farm-relief measure.
This ship-subsidy issue had been prominent in the 1922 Con
gressional elections, a number of members having been defeated
primarily, it was said, because they had favored it. Now the Lame
Duck Congress was given its orders to pass the bill before the new
members took their seats—a maneuver that inspired Senator Norris
later to begin his long and finally successful fight for the so-called
“Lame Duck Amendment” to the Constitution. 18
Harding made a personal appearance before Congress on behalf
of the subsidy.
It was no wonder that the Couzens-Brookhart action produced
a sensation. As stated by the Baltimore Sun:
This was the most novel experience the Senate has had in many
years. Here were two senators who had hardly acquainted themselves
with the methods of getting in and out of the Senate chambers and
yet they had become leaders in fact in the subsidy fight, if not in
name. 19
The staunchly Republican Philadelphia Public Ledger headlined
the incident:
POLITICAL CHAOS NOW
REIGNS IN WASHINGTON 29
9
That Couzens in his first week had helped to incite all this seemed
to mean that he, too, was an insurgent Progressive. Additional ev
idence along this line appeared when the Senate began considering
an offer by Henry Ford to buy the Muscle Shoals, Alabama, facilities
(later the basis for the Tennessee Valley Authority). This offer,


THE SENATOR
146
which had enormous popular support, was almost accepted by Con
gress. 21 Couzens asserted bluntly that neither Ford nor any other
private individual ought to have the government-owned nitrate and
power development, but it should be held by the government for the
benefit of the public.
In this, of course, he shared the view of Senator Norris, “father of
TVA”, who at just this time issued a report that called Ford’s offer
“the most wonderful real estate speculation since Adam and Eve
lost title to the Garden of Eden.” 22
Couzens felt so strongly on this issue that he gave it as one reason
for giving up his interest in the Bank of Detroit just before he took
the oath as senator. “I am going to fight Mr. Ford on Muscle Shoals
and I don’t want my stand to embarrass the bank,” he told the direc
tors of the bank. 23
His attitude helped to bring about a sharp decline in Congressional
sentiment for the Ford offer, and helped to save Muscle Shoals for
the later T.V.A. As the Detroit Free Press put it: “That Senator
Couzens, former business partner to Ford, is opposed to the offer . . .
has convinced Republican leaders that it would be a mistake to put
the Ford offer before the Congress.” 24
Even so, Couzens’ vote on the Ship Subsidy Bill, his outcry against
the Ford offer, was not yet a safe indication of his political thinking.
He had acted against the subsidy bill merely upon impulse. Later,
he said, “If it is the business of the United States to see that we have
a Merchant Marine, then we ought to assume the responsibility and
not transfer it to private interests, augmented by taxes.” 25 But in
December 1922 he had merely been annoyed that the business of the
Senate had come to a stop while senators orated for days on the ship
ping bill. 26
JO
Political success is often corrosive of political principles. When
the rebel, the iconoclast, the independent, finds himself in a position
of high influence, there is a tendency to retract the horns, to prove
that, after all, he is “safe” and “sound”; a kind of self-reformation of
the reformer occurs. With some, this change lasts only a short time;
with others, the weak ones or the opportunists, it becomes permanent.
Couzens experienced this change temporarily. He demonstrated
at the outset an unwonted sensitivity to the charge that he was not
a “regular Republican.” It was commented upon that his social com
panions, at lunch and at golf, were all of the Old Guard, men like


THE ONE-MAN BLOC 147
Frederick Hale of Maine or the steel millionaire Lawrence C. Phipps
of Colorado.
When he was in the company of Progressives like Norris, “he de
veloped streaks of orthodoxy,” one observer noted. 27 Another, in
talking with him, suggested that he would naturally be classified as
a Progressive, citing his record as mayor of Detroit, but Couzens on
this occasion was evasive. “I don’t want to be classified at all,” he
said. “If this bloc you call progressive is for something I believe in,
then I'll be with them, but I’ll not commit myself to any group. The
standpatters are not always wrong.” 28
11
Early in his Senate service, he cast a vote that was odd for a man
considered a “Bolshevik” back home.
Senator J. Thomas Heflin of Alabama, a lesser figure of the species
of “Pitchfork” Ben Tillman and Tom Watson, had made a remark,
during debate on an agricultural credit bill, which the Old Guard
took as a special slur. He was in the Senate, Heflin said, to “represent
the people . . . not the bond sharks, the big financiers of Wall
Street.” 29 Senator Lodge especially was outraged, asserted that Heflin
had violated the Senate rules against impugning the motives of col
leagues, and demanded that Heflin be refused further use of the floor.
Vice President Coolidge so ruled. A vote was taken—and Couzens
voted for suppression of Heflin. 30
In one respect, this vote could have been deemed praiseworthy,
even for a Progressive. For Senator Heflin could by no means rep
resent personally a cause worth a Progressive’s martyrdom. In the
words of a quite moderate observer: “Congress had its quota of strong
men, weak men, and fools, and foremost of the fools was . . . Heflin
. . . the national idol of the Ku Klux Klan.” 31
Yet, in a larger view, the silencing of Heflin was an attack on free
and open debate, a principle Couzens always championed.
12
Heflin turned on Couzens. He said sarcastically that he knew the
explanation for Couzens’ vote. It was his money. He had heard it
said that, though Couzens was a multimillionaire, he was progressive.
“I said, 'Say that to me again and say it slow.’ . . . Mark what I tell
you. . . . When the big interests are attacked, you will see him go
over and take his place with the bellwethers of the standpat party.
“I saw him do it this morning—my good friend Couzens of Mich-


148
THE SENATOR
igan, parading himself down here as a Progressive, and this morn
ing he walked right over and sat right down under the whiskers of
the Senator of Massachusetts.” 32
Although another man might have laughed, Couzens character
istically lost his temper. He stood up in the aisle to answer Heflin,
“his posture that of a bulldog.” In angry tones he made a demand
that startled everyone. The Senate reporter should be instructed
to read the record of the remarks just made by Heflin, because, he
explained, Wadsworth of New York had advised the Senate at an
earlier time that Heflin had edited certain remarks he had made
about Wadsworth.
“I do not propose to give him the opportunity to go in the night
time, in the dark, and change the references he has made to myself.
If Senators are free to get up here and tell the galleries and the Amer
ican people that the motives of a senator of any state are to be ques
tioned, we might as well stand up here and call everybody thieves
and liars!” 33
There ensued a scene which was, according to the New York
Herald, “reminiscent of Socialist outbreaks in the Reichstag, the
French Chamber of Deputies, soap-box events in Union Square and
Hyde Park, London.” 34 Undoubtedly, this was an exaggeration, but
by dropping the pose of a dignified Roman Senator as soon as he was
attacked, Couzens certainly had transformed the Senate into some
thing resembling the rowdy Detroit city-council meetings when he
was mayor.
Nine senators were on their feet at once, all clamoring for recogni
tion and arguing loudly one way or another about Couzens’ request.
The upshot of all the furor was that both Couzens and Heflin with
drew their remarks. Couzens found himself praised by a group whose
praise he would not appreciate for long—the clique around Harding,
to whom Big Tom Heflin was especially obnoxious. The Old-Guard
press hailed him as “a hero.” Couzens was all right after all, they
decided.
13
But at just this time he also gave Harding and the Old Guard
newspapers cause to regret his presence in the Senate. For he had
deliberately attacked Harding’s leadership on the subject of govern
ment ownership versus private ownership of the railroads.
In a special message to Congress, Harding had referred to the
government’s administration of the railroads during the war as


THE ONE-MAN BLOC
149
“folly.” For the railroad brotherhood's newspaper, Labor } Couzens
prepared a sharply critical statement on the President's message. 35
He also carried on the attack in an address before the Philadelphia
Real Estate Board. 36
He did not commit himself definitely in favor of government
ownership, but he made it plain that he resented the idea that govern
ment ownership was evil per se. In this same address, to make the
point that private business could be worse than government, he
ripped into the Lincoln Motor Car Company for the profit it made
on its contracts to produce Liberty airplane motors during World
War I. 37
He strongly refuted the propaganda line put forward by The Rail
way Review, that those who even considered government owner
ship of the railroads were subversives, in league with “the most
dangerous organizations of radicals in the country.” But, as the Kan
sas City Star said:
“Couzens has the background of many years of successful business
experience and ... is the wealthiest man in the Senate. It will be
difficult for foes to brand any plan he puts forward as coming from
a ‘wild-eyed radical.' ” 38
The Progressives were exultant. “Jim Couzens is one of the greatest
men in Washington!” Senator Brookhart exclaimed. 39 La Follette
and Norris paid him an unprecedented compliment, for a first-termer.
They backed him, though unsuccessfully, for chairman of the Senate
Committee on Interstate Commerce. 40
It was inevitable that Couzens and Harding should eventually be
at loggerheads. They were antithetical figures: Harding, the prince
of good fellows, had, in the words of William Allen White (who
liked him), “the harlot's virtues”; 41 Couzens was the epitome of the
rigidly ethical. Indeed, at their first meeting there was an air of sup
pressed hostility. 42
Just at this time, Harding appointed James G. McNary, a Texas
banker, to the office of Comptroller of the Currency. Couzens, as
chairman of a subcommittee of the Senate Committee on Banking
and Currency, had the duty of investigating McNary's background.
When a banker himself, he had adhered to certain rules which he
considered basic: A banker must not borrow from his own bank, nor
must he permit associates in his bank to make loans to themselves. 43
To his amazement, Couzens came upon evidence which indicated


15°
THE SENATOR
that Harding's choice for Comptroller had violated these rules in an
extravagant fashion as president of his bank in Texas. Couzens was
advised for example, that “for a period of more than five years, Mc-
Nary was a continuous borrower from the bank of which he was
president. ... At one time 88 per cent of the capital and surplus
funds . . . was loaned directly to the officers and directors." Couzens
immediately went to the White House to tell Harding to withdraw
the McNary appointment. 44
Harding, however, adopted the position that McNary's background,
instead of disqualifying him, proved him “a very practical man,"
the kind “needed as Comptroller of Currency." 45 Couzens stood
firm. “I agree with you that Mr. McNary is a very practical man.
I am afraid he is too practical to be the kind of disciplinarian that
the Comptroller of the Currency should be." 46
Despite Couzens' opposition, Harding insisted that the Senate con
firm McNary. He was angry that Couzens had made public the Senate
committee's findings on McNary, evidence obtained in “executive
session." To have made it public was “in violation of the long-
established conception of wise procedure," he wrote Couzens. 47
The strongest possible pressure was brought on the Republican
leaders in the Senate to push the nomination through, for McNary
was an important cog in the Republican organization of the South
west, described by William Allen White as the party's “field agent"
in Texas and New Mexico. 48
On the last day of the session, Couzens, carrying on a singlehanded
fight, threatened to filibuster unless the McNary appointment were
withdrawn. He so informed “Jim” Watson, Harding's floor leader. 49
Rather than see other legislation lost, Harding yielded, and the ap
pointment was withdrawn. Daniel R. Crissinger of Marion, Ohio,
Harding's home town, who later became Governor of the Federal
Reserve Board, was named instead.
That a Republican senator could be responsible for such an affront
to a Republican President revived a familiar question. Was Couzens
a Republican? He himself raised the point in a talk at Bay City,
Michigan. “I would like to be considered a member of the Repub
lican party. . . . But, if being a Republican means kow-towing
to the President, I do not care to be a Republican." 50
From then on, he was the old Couzens. No one would ever again


THE ONE-MAN BLOC
151
be able to say that he sat under the whiskers o£ Senator Lodge or
any other standpatter. He dropped the pose of not knowing the dif
ference between the Progressives and the Old Guard. To a reporter
for Nation’s Business, who inquired about statements that he was a
radical, Couzens said, “Yes, I’m radical as hell when I see an evil that
ought to be ended.” 51
To the Saturday Evening Post he became “The Scab Million
aire.” 52


152
CHAPTER XXIV
THE PLAIN-SPEAKING STATESMAN
In the summer of 1923, a full-fledged boom was under way to nom
inate Henry Ford for President of the United States. Ford was set
to run on either major party ticket, but preferably the Republican,
judged the most likely to win. To a later generation, one nursed
on the picture of Ford as a man above politics, or even against pol
itics, this movement would seem unbelievable. Ford himself later
denied that he had Presidential ambitions.
But it is indisputable that the boom had his approval. 1
An article signed by Ford entitled “If I Were President,” appeared
in Collier's magazine August 8, 1923. Allen Benson, prominent in
the Socialist Party, wrote a laudatory biography of Ford as part of the
boom. Besides, Ford as much as admitted to Couzens that he was a
receptive candidate. On one occasion, at a wedding, “with just the
inflection of seriousness to make me realize that he meant every
word,” he even discussed with him the possibility of having him in
his cabinet. 2
A good deal of joking went on in the press about the Ford-for-
President movement. But the reality of the Ford boom was no joke.
Even Senator Norris, the Nebraska liberal, greatly admired Ford at
the time, and perhaps would have suggested him for President. 3
That summer there was also much discussion, pro and con, of the
desirability of modifying the national laws, adopted during World
War I, prohibiting sale of intoxicating beverages. Both subjects—the
Ford boom and prohibition—were too hot for most public officials
to discuss openly with any forthrightness. The passions they gener
ated were too strong. But Couzens, though he hadn’t planned it
that way, was soon doing precisely that.


THE PLAIN-SPEAKING STATESMAN
153
2
That June he was visiting in Ottawa, while on a motor trip with
his family. A newspaper reporter there asked him to comment on
the liberal Quebec liquor laws, "I think they are fine,” he said. “I
think the United States might with good grace adopt some of them.
If our constitution were easier to amend, I believe the Volstead act
would be repealed.” 4 Somewhat embroidered, these comments were
telegraphed to newspapers in the United States—on the same day
that President Harding, on a 'Voyage of understanding,” spoke in
Denver in spirited defense of prohibition. "I am convinced,” Hard
ing had said, "they are a small and a greatly mistaken minority who
believe that the Eighteenth Amendment will ever be repealed.”
The result of this divergence of views between Harding and
Couzens was a newspaper sensation:
HARDING DEFENDS DRY LAW:
COUZENS ASKS O.K. ON BEER
The results could have been foreseen. 5 Couzens was denounced
by the prohibitionists all over the land, but especially in Michigan.
The Anti-Saloon League, the most powerful pressure bloc of the day,
went after him in full cry. He was called a "traitor to America,” a
"betrayer” of his party, his state, and his nation, and of all decent
people. The Anti-Saloon League served notice it would seek his de
feat in 1924 if he had "the gall” to become a candidate to succeed
himself. 6
He hit back at the Anti-Saloon League. It was, he said, an organ
ization that sought "to dictate” who should hold public office on the
basis of one issue, "disregarding all other problems.” "They are out
to elect a man who will go to Congress and do what they want, no
matter whether he is a bum, an anarchist, or what not.” 7 These were
fighting words, and other politicians shuddered at his daring—or
folly.
To the amazement of other politicians, he gave a half dozen
speeches in this vein. Time, a new magazine, ran his picture on its
front cover as if to cheer him on. But for the few who praised him,
hundreds denounced him. 8 "Mr. Couzens Destroys Himself,” the
Christian Science Monitor headlined. "It is a pity. There were pos
sibilities in Couzens as a public man that now may never be tested,
for his political future is, alas, behind him.” 9


154
THE SENATOR
With this din in his ears, Couzens took himself and his family off
to Europe for the balance of the recess between Congressional ses
sions, wiser perhaps, but not chastened in spirit.
On his return from Europe he made some interesting comments
about European conditions. La Follette, Borah, Norris, Johnson,
and Wheeler, on foreign affairs, were largely “isolationist,” to use a
term which became current only in the ig4o , s. It was then almost
a hallmark of a Progressive to turn one’s back on Europe and Asia.
But with remarkable insight, Couzens warned:
Germany is decidedly unhappy, with sixty-five or seventy millions
of people, the majority of whom are in great distress. . . . The
extreme isolationists [in America] have forbidden or intimidated the
United States from having a voice in world affairs. We cannot go
on that way. We have got to stand up and be counted, for or
against these various proposals for settling the economic conditions
in Europe. 3 * * * * * * 10
He also advanced a program. The United States with other powers
should establish “a receivership for Germany,” to put its affairs in
order. Ultimately, he hoped, there would develop a “United States
of Europe.”
While in Paris, he copied into his notebook a statement by Victor
Hugo. “I belong to a party not yet born, but which will be born in
the Twentieth Century. This party will have its principle in a United
States of Europe.” He read this to newspaper reporters, pronouncing
it a “sound idea.” 11
3
While Couzens was on the ocean, Harding’s death had occurred.
Promptly on his return, Couzens wrote a letter of advice, based on
his observations in Europe, to the new President, Calvin Coolidge.
Coolidge should abandon “the Harding isolationism,” he said. He
hoped, he wrote, that Coolidge in his first message to Congress,
would “express a very strong, energetic, forward position on foreign
relations.”
At that time, the principal “isolationist” in the Senate was Hiram
Johnson. Johnson was and remained Couzens’ friend. Nevertheless,
Couzens now bluntly told Coolidge: “I do not think that we are going
to get anywhere in any way by trying to placate Senator Hiram John
son.” 12


THE PLAIN-SPEAKING STATESMAN
*55
4
Couzens also made a number of public comments at this time that
caused some observers to suggest that he had gone over completely
to the camp of “noisy radicals/' notably La Follette, who was being
accused of wanting “to undermine the Constitution and the Supreme
Court." For he was outraged just then by a decision of the court
against federal regulation of child labor, a decision which set off a
revival of the movement Theodore Roosevelt and Albert J. Bever
idge had sponsored a decade earlier for permitting Congress to over
rule the court. 13 La Follette sounded anew a call for “curbing the
court" and Couzens was instinctively in agreement. To the press, he
said: “I am for bringing about a change which will not permit the
Supreme Court to declare acts of Congress unconstitutional by a
majority of one. I would have at least a favorable vote of two-thirds
of the court necessary." 14
To Editor Arthur H. Vandenberg in Grand Rapids, who was
alarmed by his comments, he wrote:
“The point I want to raise ... is that the interpretation of the
Constitution is made by human minds, and I do not believe the
opinions of five human minds should offset the interpretation of the
Constitution of the United States made by hundreds of Congressmen
and four members of the Supreme Court. . . ." 15
Vandenberg attempted, by long letters, to change Couzens' views,
arguing that Supreme Court decisions ought to be considered sacred.
Any proposal to let Congress “nullify" a court decision would
“emasculate" the court and turn Congress into a “despotism," he
said. 16 He sent Couzens copies of editorials he had written in the
Grand Rapids Herald, including one that bitterly denounced the
Scripps-Howard newspapers, as well as the Detroit News, for support
ing the La Follette proposal to permit Congress to overrule the Su
preme Court.
It was all very well, Couzens came back at Vandenberg, to be
“theoretical" about such matters. But he could not see how “a decent
man" could defend a Supreme Court decision that condemned
children to labor in factories and mines. “I am not out looking to
stir up trouble, where trouble does not exist," he wrote. “I cannot
help, however, before concluding, raising the question of how many
thousands of children may be suffering because of the Supreme


THE SENATOR
156
Court. . . . May it not be that we are prone to let these things go,
rather than risk a change? Does not the doctrine of ‘leaving well
enough alone* sometimes impose a lot of hardship, which we do not
truly visualize?” 17
5
As for Ford, who had been granting some interviews to Dr. William
L. Stidger, a Methodist minister later associated with Boston Uni
versity, for publication in newspapers and in a book on Ford’s Pres
idential aspirations, the Detroit Times on October 25, 1923, pub
lished this:
dr. stidger: What do you think of the stand that your friend Senator
Couzens is taking on the prohibition laws? He is in
favor of going back to five per cent beer and light wines.
ford: He knows he is wrong about it. Mr. Couzens knows
better. He knows that in the Ford motor plant booze
never did anybody any good, and he is taking a back
ward step when he stands for five per cent beer and light
wines. Jim Couzens knows better than that. Maybe he
feels he is striking a popular chord.
Couzens considered Ford’s remarks about him an attack on his
integrity. 18 A week later, Couzens, for the first time in his career,
publicly gave vent to his anger at Ford.
He began a speech before the Republican Club at the Hotel
Statler in Detroit with an apparently general discussion of the need
for truthfulness in public affairs. “Parties and public men have not
always been truthful,” he said. Then he said he was “forced” to dis
cuss a man who “exemplified” this. “The example is our chief
Democratic politician, Henry Ford, who recently gave a newspaper
interview, so it is reported, and he has not denied it, differing with
me on the amendment I suggested on the Volstead act.” He de
nounced Ford in particular for ascribing political motives to Couzens’
suggestion that the Volstead Act be modified. He went on:
It comes from poor taste from a man who is so politically am
bitious as Mr. Ford and who has never gotten over his peevishness
because of his defeat for United States senator on the Democratic
ticket. A man who has perhaps made more unfulfilled promises
than any man in America should be more guarded in challenging
the motives of other people. . . .
If Mr. Ford wants to be president—and it is quite evident he does
—because he has filed his name, or at least permitted it to be filed,


THE PLAIN-SPEAKING STATESMAN
x 57
in the Nebraska primaries—why does he refrain from announcing
himself as a candidate? The reason, it appears to me, is that he is
afraid, realizing that the probable outcome would be as great a
fiasco as his “Peace Ship” . . .
Mr. Ford for president? It is ridiculous. ... If the American
people ever stop to analyze Mr. Ford’s experience and his qualifica
tions for the presidency of the United States, he will never even
get started. It is my hope that they will stop and think.
I say this not only because I want to save Mr. Ford from the
greatest humiliation that could befall him. But I want equally to
save the United States from the humiliation it would suffer. 19
A good many persons had been saying precisely these things
privately. Republican leaders generally were pleased that Couzens
did so publicly. In his syndicated column from Washington, Mark
Foote wrote: “Republican politicians howled with delight. President
Coolidge is said to have pulled a wry Puritanical smile. . . . Pol
iticians who had never been able to discern any good points in James
Couzens now declared him a great man.” There also was some com
ment on the fact that just before leaving Washington for Detroit to
make his speech on Ford, Couzens and his wife dined with the
Coolidges. 20
6
He did not return to the subject of Ford’s Presidential ambitions.
He had not really relished attacking his former associate openly.
Moreover, the Ford boom suddenly petered out, after Ford and Cool
idge had a meeting at which Coolidge seemed to agree to support
Ford’s ideas for Muscle Shoals. 21 After this meeting, Ford said to
reporters: “Muscle Shoals? Where is Muscle Shoals?” 22
Ford did not answer Couzens. And before long, curiously enough,
he and Couzens seemed better friends than they had acted for a long
time.
Besides, Couzens was soon involved in an heroic controversy with
Secretary of the Treasury Andrew W. Mellon, who more than any
other individual embodied the dominant philosophy of the Repub
lican party in this era.


158
CHAPTER XXV
THE MILLIONAIRES’ WAR
Early in November 1923 the New York Times sent a telegram to
Couzens in Detroit: “We will appreciate it if you wire us collect your
views on Secretary Mellon’s propositions to reduce income taxes.” 1
Quite innocently, this telegram directed him on a course that touched
off one of the most explosive political controversies of his generation.
Couzens had not planned things this way. Indeed, he answered the
Times noncommittally. “It would not be wise,” he said, “for a Senator
to commit himself in advance to a proposal of this kind. The matter
will naturally go to the Finance Committee and no Senator should
commit himself until he hears the arguments and recommendations
of the Committee.” 2
Only a few days earlier, in a speech before the Detroit North End
Republican Club, he had mentioned the Mellon proposals in passing.
He seemed to favor them. In any event, he did not denounce them.
“There is going to be a suggestion before Congress,” he said, “that
the surtax be reduced from fifty to twenty-five per cent, and a hurrah
goes up that it is all in favor of the rich. Well it does not make much
difference who it is in favor of, so long as the Government gets its
proper taxes from each and every individual.” 3
But what were “proper taxes?” The New York Times telegram set
him to thinking about this in specific terms. He was aware, of course,
that Mellon’s proposals, widely acclaimed in the press, were close to
being canonized doctrine of the Republican party. For this was the
era in which Andrew Mellon was hailed as “the greatest Secretary
of the Treasury since Alexander Hamilton.” In the words of one
observer: “Anyone who disagreed with Andrew Mellon on taxation
was a menace to constitutional government.” 4
Promptly on returning to Washington the following December,
Couzens summoned a stenographer and dictated a letter to Secretary


THE MILLIONAIRES’ WAR
159
Mellon. By asking Mellon some pointed questions—his habitual
manner—he hoped to clarify his own thinking. He set down the
claims made for Mellon’s proposals—that the current high wartime
surtax rates were retarding business; that the government would get
more revenue, not less, from lowered rates; that high surtaxes were
driving vast sums of capital into tax-exempt securities and thus re
tarding industrial investment, etc.—and after each argument, he
asked for “proof.”
Now, Mellon, a multimillionaire financier and industrialist in his
own right, was a man of mild appearance. He was “self-deprecating,
gentle and smiling,” William Allen White said. 3 * 5 But this appear
ance was deceptive. Actually he was as self-assured and nearly as
aggressive as Couzens himself. 6 He was used to being treated with the
utmost respect, even by those who did not like him, even by Dem
ocrats. Yet here was Couzens, a Republican, challenging his views on
taxation, views considered to be his great contribution to public
service, or so Mellon interpreted Couzens’ letter.
2
Mellon responded with a letter that displeased Couzens violently. 7
As he afterward told Vandenberg, “Whatever has been the outcome
of my first correspondence with Mr. Mellon, has been due entirely
to Mellon’s own arrogant desire to ‘lord it’ over all of us who dared
to question him.” 8
He was not alone in that opinion. David Lawrence, an admirer of
Mellon, conceded that “Mr. Mellon rubbed the Michigan senator
the wrong way.” 9 Even Mark Sullivan said, “Although Secretary
Mellon is one of the gentlest of men, and Senator Couzens one of
the most truculent, I think the former is a little more responsible
than the latter for the beginning of the row.” 10
What Mellon ought to have done, said Sullivan, was to “dump
a couple of barrels of figures on Mr. Couzens.” Instead, he wrote
Couzens a letter “that sounded a little resentful.” 11 In effect, Mellon
told Couzens that he ought to leave such matters in the hands of a
man who understood them.
3
Couzens replied caustically. He accused Mellon of seeking to im
pose his views on the nation to the exclusion of everyone else. “I
dissent,” he wrote, “from permitting one individual doing the di-


i6o
THE SENATOR
agnosing and prescribing the remedy. I propose to engage in this
diagnosis myself and perhaps have some voice in the decision/’ 12
Mellon sent back a reply, but not one calculated to placate
Couzens:
It is reported in the newspapers that all your capital is now in
tax exempt securities, and I have not seen any denial from you.
This means, if it means anything, that you pay no income tax. . . .
Must a system of taxation which permits a man with an income of
over $1,000,000 a year to pay not one cent to the support of his
Government remain unaltered? 13
This was a jab at Couzens in a sensitive political spot. It was a fact
that the bulk of Couzens’ money was in government bonds. He never
denied it. His usual reply to critics on this was: “In reality, I prepaid
my tax by investing my money in municipal, state, and government
securities at a very much less return than I would receive if I had
invested in mortgages, railroads or industries.” 14 Then, too, he
had switched his investments from private securities to government
bonds because, as he once explained, he wanted to insulate himself
against pressures that might be exerted through ownership of stock
in companies or banks. But he could never get people to understand
these considerations, as he himself conceded some years later in urg
ing that tax exemptions on government securities be abolished. 15
To Mellon, Couzens rejoined: “So long as you have entered into
the record of my securities, will you please tell what your securities
are, how much you own of them, and how much you will benefit
by the reduction of surtaxes as proposed by you?” He followed with
barbed references to a well-known fact: much Mellon money was
invested in the distillery business. Is money used for making whiskey
more “useful” than money invested in public improvements? he de
manded. 16
Ordinarily, cautious men in politics might have dropped matters
there—assuming they had let things proceed this far. But neither
Couzens nor Mellon was cautious. They kept up the exchange, send
ing each other a sufficient number of letters to make a good-sized
book, and each contrived that much of this correspondence should
become public.
In one letter, Couzens cited his own experience as evidence that
Mellon’s proposals would “help the rich.” It was ironic, in view of
what was to come, that he recalled that when he sold his Ford Com
pany stock to Henry Ford, he paid an income tax of $7,229,161.75
for the year 1920. “If your proposal had been law, I would have saved


THE MILLIONAIRES* WAR
161
nearly four million dollars; so I do not see where the country gains by
creating these enormous savings for those well able to pay.”
He wound up by urging that Mellon engage in a public debate on
the matter, “where both of us will be forced to rely upon our knowl
edge, rather than upon statisticians who can make figures tell any
kind of a story, or upon lawyers who can argue from any side.” 4 * * * * * * * * * * * * 17
Couzens soon found himself thrust into the role of the nation's
leading opponent of “Mellonism.” Though he had not intended
this, he accepted the role, while the public enjoyed a dramatic spec
tacle: two multimillionaire public officials at war.
Couzens cleared his decks for action by abruptly accepting the
resignation of his secretary, Walter Dorsey, whom he had inherited
from Senator Newberry. Trained in the old school, Dorsey felt that
Couzens “ought not have criticized Mellon.” 18 Then, at the sugges
tion of Jay Hayden, Couzens took on a new secretary—John Carson,
a Scripps-Howard reporter with a flair for fact-finding and crusading
who, years later, was appointed to the Federal Trade Commission
by President Harry S. Truman. With Carson's help, Couzens pre
pared for a real assault on Mellon. 19
4
On February 21, 1924, he struck at Mellon in a way that startled
everyone. He introduced a Senate resolution calling for an investiga
tion of the Bureau of Internal Revenue. 20
This bureau had never before been subjected to investigation,
though its financial and political powers were obviously enormous,
a fact that Couzens was to point up when he said: “Give me control
of the Bureau of Internal Revenue and I will run the politics of the
country.” 21
Almost before Mellon and the Old Guard were aware of what had
happened, the Progressive bloc, joined by some Democrats, had lined
up behind Couzens' bold resolution, and it had passed. 22
With the aid of John Carson, Couzens was soon making public
some interesting material. Over the protests of Senator Watson, chair
man of the committee, and Senator Richard Ernst of Kentucky (a
personal friend of Mellon), Couzens had obtained from the Bureau
of Internal Revenue its files on thirty-eight corporations in which
Mellon was at that time, or had been previously, financially inter
ested.
These files revealed that certain of the firms had received large
tax rebates. They also revealed, through various memoranda, that


162
THE SENATOR
the Bureau had gone out of its way to treat these corporations with
special deference, if not with favoritism. 23
Mellon denounced the revelations as “nonsense.” The rebates were
merely routine. The companies in question were entitled to what
they had received. He professed to be unconcerned. But Mellon was
obviously fuming, and began to look for a politically safe way to
bring the Couzens “nonsense” to an end.
One way to stop the investigation was to get Couzens out of the
Senate. Couzens soon found himself a guest at the White House,
where an attractive offer was made to him by President Coolidge—
the ambassadorship to the Court of St. James. But Couzens’ answer
was, “I won’t be kicked upstairs.” 24
5
Governor Gifford Pinchot of Pennsylvania, the old Bull Moose
Progressive, then entered the picture. An ardent “dry” and an equally
ardent political enemy of Mellon’s, he gave Couzens some material
which suggested a scandalous situation in the Bureau of Internal
Revenue with regard to prohibition enforcement. 25 But it would
be useless, Pinchot said, to go into this, or even into income-tax
matters, unless the committee had the services of a lawyer experienced
in investigations. He had a name ready—Francis J. Heney of Cal
ifornia, a La Follette follower who had handled the public-lands
scandal investigation during the Theodore Roosevelt administration.
Indeed, Pinchot had already consulted Heney by telephone.
Heney was interested, but there was a stumbling block—Heney
had to be compensated. Was Couzens aware that his resolution for
the investigation had omitted any mention of retaining and paying
for counsel?
For the first time, Couzens realized that he had omitted such a
provision. But he quickly came up with a solution. “I will pay Heney
out of my own pocket!” he told Pinchot. 26
At the next meeting of his committee, Senator Watson raised
vigorous objections. For a Senator to use his own funds for such a
purpose was highly irregular, he maintained. But the two Democratic
members of the committee sided with Couzens, and Heney was re
tained. 27
Watson immediately communicated with Mellon and also with
President Coolidge, as he later told the Senate. 28
A conference of administration leaders was hastily summoned.


THE MILLIONAIRES’ WAR
163
For months, these leaders had been disturbed over Senate inves
tigations in general. The Teapot Dome investigation was then in
progress. There was also an investigation of the Department of
Justice and one of the Veterans' Bureau under way. Ahead was the
1924 election. The thought of Heney being set loose on prohibition
enforcement, as well as tax administration, was appalling to the Old
Guard. Watson was surprisingly candid about this. With Heney
conducting an investigation, backed by Couzens and by Pinchot,
Mellon's old enemy, there would result, said Watson, “a saturnalia
of vituperation and aspersion unequaled hitherto in the political
annals of America!” 29
6
On the heels of the leaders' conference, Mellon sent Coolidge a
solemn communication. The Couzens investigation, it said, was
merely an effort to “vent some personal grievance,” but its effect
would “threaten the institution of government itself.” “A private
individual is authorized to investigate generally an executive de
partment of the government. ... If the interposition of private
resources be permitted to interfere with the executive administra
tion of government, the machinery of government will cease to func
tion.” 30
Coolidge then promptly dispatched Mellon's letter to the Senate,
incorporating it in a special message of his own:
It seems incredible that the Senate of the United States would
knowingly approve the past and proposed conduct of one of its
committees which this letter reveals. . . .
Under a procedure of this kind, the Constitutional guarantees
against unwarranted search and seizure breaks down, the prohibi
tion against what amounts to a Government charge of criminal
action without the formal presentment of a grand jury is evaded,
the rules of evidence which have been adopted for the protection of
the innocent are ignored, the department becomes the victim of
vague, unformulated and indefinite charges; instead of a Govern
ment of law, we have a Government of lawlessness.
Against the continuance of such condition, I enter my solemn
protests and give notice that in my opinion the departments ought
not to be required to participate in it. . . . It is time that we re
turn to a Government under and in accord with the usual forms
of law of the land.
Calvin Coolidge 31


164
THE SENATOR
7
Obviously, this was not a Presidential message calculated to please
senators. Even regular Republicans in the Senate were angered. Only
a short time before this, Coolidge, in a confidential chat with Chief
Justice Taft, had referred to senators as “cowards," 32 but he was
to learn now that some senators could strike back, even at him. Tom
Walsh of Montana, in charge of the Teapot Dome inquiry, called the
Coolidge message “the most arrogant sent by an executive to a par
liamentary body since the days of the Stuarts and Tudors." Reed of
Missouri called it “such an insult as one branch of the government
could not accept from another." He presented a resolution to have
it expunged from the records. 33
Carter Glass, who had been Wilson’s Secretary of the Treasury,
declared that Coolidge had “impeached the probity of the Senate
. . . charging it with subterfuge and insincerity." Glass added: “This
message, this letter of the President and of the Secretary, constitute
the most extraordinary breach of official etiquette that has ever oc
curred in the history of the Republic." 34
8
Clearly, Couzens had found himself with ardent allies, but he
himself was not among the senators who replied to Coolidge from
the floor of the Senate. For several weeks before this, he had been
suffering from intense abdominal pains. 35 On the very day of the
Coolidge blast, he was laid so low that once again his family feared
he was dying. His son Frank and Dr. Hugo Freund were called from
Detroit. Soon he was at Johns Hopkins Medical School Hospital in
Baltimore for another operation, his fifth in four years. Mark Foote
published an appropriate comment: “It was an irony of fate that just
as Senator Couzens was cited by the President for ‘throwing the
government into disorder,’ he should be sorely stricken and taken
to a hospital. . . . Thus the Michigan senator, whose worst enemy
would not accuse him of running away from a fight, is not able to
fight back. . . .’’ 36
Just before he was placed on the operating table, good news was
brought to him. The Senate had defeated a resolution by Jim Wat
son for squelching the investigation. It was to proceed, this time with
authority to employ counsel at Senate expense. Couzens had to make
one concession. Heney could not be retained, but was to be replaced


THE MILLIONAIRES’ WAR
165
by another lawyer acceptable to all members of the investigating
committee. 37 But he had the satisfaction of knowing that he had
scored a smashing victory over both Coolidge and Mellon.
9
After his recovery, he returned to the investigation. Senator Wat
son had in the meantime had the good grace to resign as chairman of
the committee, and Couzens succeeded to that post, which, accord
ing to all precedent should have been his from the outset.
Beginning in December 1925, Couzens issued a series of reports
that were revealing documents, particularly with regard to tax al
lowances permitted corporations that had engaged in military pro
duction during World War I. 38 They showed that such companies
had obtained “refunds” running into many millions, on the basis
of Treasury interpretation of tax and defense acts. One such report,
issued in December 1924, listed refunds, among others, of $4,590,
585 to the Gulf Oil Company (a Mellon concern); $3,378,000 to the
Standard Oil Company of California; $5,000,000 to the Sinclair
Consolidated Oil Company; $1,638,375.87 to the Kennedy and
Springer Corporation. 39
The following January, Couzens’ committee issued a report which
estimated that “improper amortizations” on World War I produc
tion facilities, between July 1, 1921, and April 30, 1924, had cost the
federal treasury nearly $460,000,000. Among the firms cited were the
Aluminum Corporation of America (Mellon), $15,589,614; the
United States Steel Corporation, $55,063,312; the Bethlehem Steel
Company, $22,103,942; the E. I. DuPont de Nemours Company,
$*5*369,123; the Federal Shipbuilding Company, $10,849,786; the
Midvale Steel and Ordnance Company, $9,336,440; and the National
Aniline Chemical Company, $9,912,140. 40 Among other beneficiaries
of Treasury rulings, the report showed, were various persons prom
inent in Republican affairs, and publisher W. R. Hearst. 41
These refunds were all legal. But this was Couzens’ main point.
His purpose was to show what loopholes existed in the tax laws, and
with what leniency the Bureau of Internal Revenue had secretly been
interpreting the laws, often without the general public having any
inkling of what was going on.
It was said at the time, and later, that “nothing came” of Couzens’
revelations. In a sense, this was largely true. His reports did not
completely reform the Bureau of Internal Revenue. In World War


i66
THE SENATOR
II, large “amortizations” on war production were again permitted,
and in many cases they were probably no more justified than those
revealed by Couzens , committee.
But his inquiry did end the secrecy. In 1929, in consequence of
his reports, an executive order issued by President Hoover provided
for publicity on all Treasury refunds of more than $20,ooo. 42
In addition, his inquiry resulted in the creation of the Joint Com
mittee on Taxation of the Senate and House, which, for the first
time, placed at the disposal of Congress a continuing staff of experts
on a legislative subject—a major reform in Congressional history. 43
In Ray Tucker's phrase, this was Couzens' personal “monument.”
10
There was, however, a surprising, even shocking, sequel. On March
7, 1925, Mellon brought a tax action, in the name of the Treasury,
against Couzens. 44 It charged that Couzens had underpaid approx
imately $10,000,000 in taxes due from his profits on the sale of his
Ford Motor Company stock back in 1919. All of the other former
Ford stockholders were also sued. But Couzens was the real target of
the action.
Later it developed that this incredibly vindictive counterattack
was an indirect outgrowth of both the Newberry case and Henry
Ford’s lawsuit against the Chicago Tribune in 1916. In connection
with the Ford suit, a Tribune reporter, in 1922, had suggested to
Senator Watson that an investigation be made of the income-tax
payments made on the Ford stock sold to Ford. A memorandum
purporting to prove that not enough taxes were collected was handed
to Watson, who in turn handed it to the Bureau of Internal Revenue.
The memorandum was checked by the Bureau and found unsub
stantiated. When Senator Newberry was being prosecuted by Ford,
the same information was produced by Senator Watson. 45 Again the
Government rejected the matter.
Now, in connection with Couzens, this old and discredited mem
orandum was remembered by someone, who called it to Secretary
Mellon's attention. And it was on the basis of this that Mellon took
action against Couzens. 46
11
There followed a legal battle before the United States Board of
Tax Appeals that lasted three years. Joseph E. Davies (later the


THE MILLIONAIRES* WAR
167
United States ambassador to Moscow) joined Arthur J. Lacy, Clarence
E. Wilcox, and C. J. Huddleston, Couzens’ personal attorneys in
Detroit, in the defense battery. Perhaps no other tax action by the
federal government was ever so vigorously prosecuted—or defended.
In taxation history, it was a cause celebre.
The upshot was a complete vindication of Couzens. For it was
brought out that in the government’s own files were documents that
cleared him of the least suspicion of tax evasion. They showed, in
fact, that his tax return on the Ford stock sale had been subjected
to investigation on various occasions and that each time it had been
decided there was no basis for reopening the matter. The action was
flagrantly political. 47
The decision was that he had paid not too little tax on the Ford
stock sale, but too much—that instead of owing the government
$10,000,000, he was entitled to a refund from the government of more
than $900,000 as overpayment. 48 Indeed, not only the financial angle,
but the whole matter redounded to Couzens’ advantage. For the
proceedings exposed to the public, for the first time in an official way,
much of the inner history of the Ford Motor Company, and this his
tory revealed what few realized—that Couzens was as much respon
sible for the fabulous Ford Company success as Henry Ford. A typ
ical newspaper headline throughout the world read:
COUZENS THE MAN BEHIND FORD SUCCESS
Politically, this was all to the good for Couzens. Moreover, as
one journalist noted, “this denouement was crushing for Mellon,”
for it placed the High Priest of the Administration Temple in “the
role of a shyster prosecutor.” 49


168
CHAPTER XXVI
“THE LA FOLLETTEITE!”
By then, Couzens* political creed had matured. It was not conscious
Progressivism, in the La Follette sense, though most of the time he
did stand close to La Follette. Nor was it simon-pure insurgency,
in the style of Brookhart or Magnus Johnson, the Minnesota whirl
wind, though much of the time, certainly, he was an “insurgent”
in the Republican ranks. His political principle was almost purely
and simply the principle of Independence—the old-fashioned Amer
ican habit of dissent. “I can*t help it,** he once exclaimed, “that the
Progressives generally are in agreement with me!** 1
The closest he ever came to formulating any definitive political
philosophy was in a letter to a newspaper editor:
I want to do what I can to see that life is not made a burden
for the many and a holiday for the few. I want to do that which
will contribute the greatest good to the greatest number. That has
been and will be the basis for my work in public life. 2
In practical political terms, his position of independence always
presented him with a problem. It naturally cut him off from any
political organization, in particular the old-line Republican cliques
in Michigan, headed by such leaders as Charles B. Warren. These
never wanted him on any terms. Because, almost as a matter of honor,
he scrupulously avoided building a personal organization, as La
Follette and others had done, it was asking for an apparent miracle
to expect him to get elected to remain in the Senate. “Bullheadedly,**
Couzens did not believe this. In 1924, when his appointed term was
finished, he set out to prove he was right.
The 1924 election was the crucial one in his Senate career. In the
primary, he was opposed by the Anti-Saloon League, as could have
been expected. But he was also opposed by the chambers of com-


“the la folletteite!”
169
merce, the manufacturers’ associations, and (because Mrs. Couzens
was a Catholic) by the Ku Klux Klan, then at its peak of influence.
The various state Republican factions put up candidates against him,
notably Hal H. Smith, an attorney for the Michigan Manufacturers
Association, and Federal Judge Arthur J. Tuttle, who declined,
thriftily, to resign as judge to join the race.
Former Congressman Joseph W. Fordney undoubtedly expressed
the sentiment of the dominant party leadership:
“Senator Couzens is a wolf in sheep’s clothing. He is not a Re
publican. He is a Socialist. Anyone who is for President Coolidge
should not be for Senator Couzens.” 3
2
The major 1924 campaign issue centered on Senator La Follette.
When La Follette, following Coolidge’s nomination, announced
he would run for President on a Progressive platform, the big ques
tion in the Republican primary in Michigan became loyalty to
Coolidge and the Republican party. The Republican leaders, and
the party press, attempted to submerge every other question, espe
cially after Senator La Follette, together with the railroad brother
hoods, issued strong endorsements of Couzens.
The partisan press set up a statewide commotion. If Couzens were
not a “La Folletteite,” it was up to him to denounce La Follette,
the editors said.
This Couzens refused to do. He insisted that he, and La Follette
too, had as much right to the Republican label as Coolidge or
Andrew Mellon. Besides, he admired La Follette’s courage, unques
tioned integrity, keen analytical mind, and great oratorical ability. 4
In May 1924 the Old Guard tried to smoke him out. Burt D. Cady,
chairman of the Republican State Central Committee, sent Couzens
a letter which asked him to sign a pledge that he stood for “the
principles of the Republican party” and that he would support any
candidates nominated by the party. Couzens rejected any such
pledges. He was “always prepared” to tell how he stood on any
principle. He would do so, but it would have to be “in my own
way” and “at the proper time,” not by the signing of a partisan
“pledge.” 5


170
THE SENATOR
3
In Grand Rapids, Editor Arthur Vandenberg was worried. He
admired Couzens’ independence, he said, but feared his defiance
of the party leaders would cost him the nomination. If Couzens
would only come out strongly against La Follette, Couzens would
be all right. The situation certainly seemed critical, for the Re
publican state convention had just then handed Couzeps an un
precedented snub, convening without even extending him an invita
tion to attend. In effect, he had been read out of the party, in so far
as this could be done.
Vandenberg met with Couzens and they had what both described
as “a delightful talk.” 4 * 6 But Vandenberg got nowhere with his at
tempts to persuade Couzens to disavow La Follette and at the same
time declare himself for Coolidge for President and Charles G. Dawes
for Vice President in any statement he planned to make of his own
candidacy. Instead, when he announced his candidacy, appropriately
enough on Independence Day, Couzens took the occasion to de
nounce what he considered an effort by the state political organiza
tion to dictate to him. He would not be controlled “by party bosses,”
said his statement. It included no statement at all on the Presi
dential election.
As for pledging himself to support the party’s principles, he as
serted that he could be a Republican without approving the state
and national platforms. Platforms, he said, too often are designed “to
fool the people.” To which he added:
I claim to be a Republican as much as though I abjectly said
I will follow President Coolidge. Nothing in the Constitution re
quires that I say “yes” to everything that the President, whoever
he may be, proposes. I consider the fact that Congress refused to
be dictated to and controlled by the President as a strong element
in the safety of our Republic. 7
4
Vandenberg and other conservatives were, of course, saddened and
dismayed, though Progressives generally hailed his defiance of the
state machine. La Follette was delighted, and immediately offered
to come to Michigan to help Couzens campaign for the nomination. 8
Hiram Johnson, equally jubilant, telegraphed to Couzens that he
had demonstrated “independence and courage . . . the two quali
ties most feared by those who would exploit government for selfish


“the la folletteite!” 171
purposes.” 9 Taking note of reports that Coolidge and Mellon were
working for Couzens’ defeat, Johnson said:
The fact of the matter is your offense, like that of some of the
rest of us, was your position on the Mellon Tax Plan. . . . Mr.
Mellon and his Tax Plan were the test of progressivism, and also
the acid test of our conservative brethren. The gentlemen who be-
believe that government is for the few . . . could forgive any other
action than opposition to Mr. Mellon and his tax scheme. 10
The Detroit News carried an amusing comment:
The political situation is somewhat confusing. . . . President
Coolidge is for Senator Couzens, provided Mr. Couzens is for Presi
dent Coolidge. Mr. Mellon is not particularly for Mr. Couzens. Sena
tor Couzens is somewhat against President Coolidge and somewhat
against Senator La Follette, but not enough against either one to
be for the other. 11
5
Vandenberg kept peppering Couzens with arguments against
La Follette, most of which amounted to the allegations that La Fol
lette was either a “radical” or a “hypocrite.”
Couzens did not pretend to possess Vandenberg’s ability for full
blown rhetoric. But he certainly held his own in their exchange.
“What I do not understand,” he told Vandenberg, “is the intoler
ance such a finely-educated and clear-thinking gentleman as your
self has for Mr. La Follette.” “Even Christ was a radical,” he re
minded Vandenberg, and enclosed an editorial from the Detroit
News, which said, “It is idle to pretend that La Follette or the Con
ference for Progressive Political Action are opposed to American
institutions in any particular. Even those who disagree most strongly
with La Follette admit his honesty, his loyalty and his courage.”
“This Detroit News piece,” said Couzens, “comes much nearer
meeting my views than the editorial which you wrote.” 12
In August, Vandenberg did wring a concession from Couzens.
He personally would vote for Coolidge for President. He reasoned
that he might as well, since there was no chance that La Follette
would win. There certainly was no difference, in his view, between
Coolidge and the Democratic candidate, John W. Davis. But Couzens
refused to call for a Coolidge victory or to repudiate La Follette.
Vandenberg and his newspaper had to be content with endorsing
Couzens’ nomination on the basis of his unenthusiastic commitment
to cast his personal vote for Coolidge.


172
THE SENATOR
6
Hysteria in the Republican ranks over the La Follette uprising
reached a climax in September. The Republican campaign man
agers expressed a fear that La Follette would get enough electoral
votes to result in a draw, necessitating a decision by Congress as in
the case of President Rutherford B. Hayes in 1876.
This, they said, might conceivably lead to the selection of Gov
ernor Charles W. Bryan of Nebraska, brother of William Jennings
Bryan, the Democratic candidate for Vice President, as “Acting
President.” In the words of a careful scholar of the campaign, the
prospect of “Brother Charlie” becoming President “was an anomalous
situation carefully nurtured by Republicans to frighten voters away
from the La Follette candidacy.” 13
In Michigan, Couzens' opponent, Hal Smith, of the manufac
turers' association, immediately raised the cry: “How does Couzens
stand?” He demanded that Couzens state whether he would vote for
“Hell and Maria” Dawes for Vice President, or for “Brother Char
lie,” should the issue reach Congress. In Grand Rapids, Vandenberg
professed great alarm. To Couzens, the whole matter was “fantasti
cally silly.” Besides, he had no intention of committing himself in
advance to a “standpatter” like General Dawes.
He conferred with Governor Groesbeck. So far as he knew at the
present time, he told the governor, he “probably” would vote for
Dawes. But “whether I would be of that mind next December is
another question.” How could he say in advance? He did not think
the matter was a real issue. He would not make any statement, and
he telephoned Vandenberg to that effect. 14 Vandenberg was beside
himself. All might be lost if Couzens persisted in his attitude, he
insisted. 15 But Couzens stuck to his position. In a letter to Vanden
berg he wrote: “It would be perfectly stupid to promise something
today and then next December find that to carry it out would be the
height of folly. . . . For example, suppose Mr. Dawes went crazy
or became unbalanced in any way between now and December;
certainly then he should not be put in the office of President.” 16
Afterward, he explained that he “resented” being “hounded” on
the Dawes-Bryan matter, whereas nobody raised that question with
his primary opponents. “It makes it seem as though I were some
outcast and begging to be taken in,” he told Vandenberg. “I assume


“THE LA FOLLETTEITE! ,, 173
you understand how I feel about that. So long as I feel that way,
the office would never induce me to surrender.”
To which he added:
I have seen a number of editorials that the country is going to
the bow-wows if any one of the three candidates for President is
elected. We go through all these tortures and excitements, each
side claiming if the other side gets into control, the country is done
for. Yet we go on, decade after decade, no matter who is in the
White House. ... In other words, I cannot get excited over this
question. 17
7
Couzens turned out to be right in saying there was “nothing to
get excited about.” Despite his “irregularity,” sentiment ran so
strong for him that Hal Smith retired from the race at the last mo
ment. Smith urged his supporters to vote for Judge Tuttle in the
primary. But Couzens had a counter in that game, for it was ap
parent that many Democrats planned to cross over into the Republi
can primary to vote for him. In August, William A. Comstock, the
Democratic state chairman, declared: “Couzens is really a Demo
crat, only he doesn’t know it!” 18 —something that would be said
of President Dwight D. Eisenhower a generation later by newspapers
like the Chicago Tribune. E. D. Stair’s Detroit Free Press set up
a constant barrage against Couzens on one theme: He was a “So
cialist ... La Folletteite.” It called for all Republicans to rally
behind safe and sound Judge Tuttle. But the primary resulted in a
resounding Couzens victory. The best part, Couzens wrote to Van
denberg, was that the result “freed me of any obligation to serve
the organization Republicans or to be with them.” 19
In the election itself he was supported by La Follette Progres
sives, by Socialists, and by many Democrats, as well as regular Re
publicans who had no other place to go. He was returned to the
Senate for his first full term by a majority of enormous proportions,
a victory all the more remarkable in that, although his independence
had alienated him from the regular political organizations of his
party, he had refrained from building any real personal organiza
tion. This would have meant making use of patronage in one way or
another, and this he never would do. So his senatorial destiny, as he
wished it, was to stand or fall on his record alone.


CHAPTER XXVII
THE CRITIC OF COOLIDGE
“What I hope for is that there will be enough aggressive Republi
can representatives in the next Congress to make the party stand for
something better than it has in the past,” Couzens had told Vanden
berg during the campaign. 1 His hope was ill-founded. For the land
slide that kept Coolidge in the White House had crushed not only
the Democratic party—forever, some mistakenly said—but also the
La Follette movement. In Charles A. Beard’s phrase, the era of the
“golden glow,” was on. Less than a year later, Senator La Follette
died.
Couzens, in addressing the Brotherhood of Locomotive Firemen
and Enginemen the following day, paid La Follette’s memory one
of the finest of tributes.
Yesterday we lost, I think, the greatest American of our age. No
man stood up for so many years against the abuse, the misrepre
sentation, and the lies of the big press and of capital more fear
lessly or more unflinchingly than did Senator La Follette. We may
not always have agreed—any of us—with all he did or said, but
none there are, who, having a proper appreciation of his noble at
tributes of mind and heart, could fail to admire him. . . . The few
who dare, must speak, and speak again, to right the wrongs of
many. I think Senator La Follette typified that thought more than
any man who has ever been in public office. 2
The Old Guard under Coolidge and Mellon had conspired to de
prive La Follette of his committee chairmanships as punishment for
his third-party heresy, and now they looked askance at Couzens for
his praise of La Follette. Some charged it to his “idiosyncracy.” But
as often happens history provided a sequel. In 1955, on the one
hundredth anniversary of Old Bob’s birth, at an observance arranged
by the Wisconsin State Historical Society, Chief Justice Earl Warren


THE CRITIC OF COOLIDGE
175
of the Supreme Court of the United States, a Republican appointed
to the Court by a Republican President, Eisenhower, stood alongside
one of La Follette’s surviving colleagues, Editor William T. Evjue
of the liberal Madison Capital-Times, and paid tribute to La Follette
in almost the same phrases used by Couzens in 1925. 3 Had he lived,
even Vandenberg would probably have been there—thirty years later.
In 1957, a bipartisan committee of the United States Senate in
cluded La Follette among five Senators—along with Clay, Webster,
Calhoun, and Robert A. Taft—to be considered as “immortals” of
the Senate.
2
No one emerged to take La Follette’s place in the Senate during
the 1920’s. Neither Couzens nor Norris had his precise qualities. La
Follette’s son, Robert, Jr., who succeeded him and with whom
Couzens always had a kind of father-son relationship, carried on his
policies, but he was too young.
Besides,, for many of the old farm bloc, the attraction of insurgency
had begun to wane. Hiram Johnson, for example, began to reflect
the views of Hearst more and more and to make a narrow isolation
ism, rather than progressivism, his standard. William Allen White
commented: “The country is in a Coolidge mind.” 4 And Senator
Norris recalled: “Those were dark days and years, when America
seemed lulled into indifference.” 5 No wonder; prosperity seemed
to be everywhere. The political atmosphere was becalmed.
When squalls did develop, Couzens was usually at their center—
or nearby.
There was, for example, the controversy at the beginning of
Coolidge’s new term over the nomination of Charles B. Warren of
Detroit as Attorney General. Stone had been appointed to the Su
preme Court, “kicked upstairs,” some said, for his embarrassing
integrity. This was the same Warren whose Detroit Board of Com
merce committee on unemployment relief Couzens had so severely
criticized in the hard winter of 1914-1915—and whom he had
“buttered up” with a $4,000 contribution to the Republican party
in 1916, when he considered himself a “regular” Republican. But
now Couzens had different ideas about Republican leadership, and
joined progressives of both parties in opposing confirmation of
Warren.


176
THE SENATOR
3
Ample reason certainly existed for Couzens' opposition to Charles
Warren. As Couzens knew from personal experience, Warren had
long been associated with the so-called “Sugar Trust," as attorney
and also as principal owner of sugar-corporation shares. In 1911,
when a Congressional committee investigated the trust, he was one
of the figures called and later even placed under indictment. Indeed,
this case was still pending in March 1925 when Coolidge sent his
name to the Senate. As Couzens, along with Senator Tom Walsh of
Montana, emphasized in Senate debate, this meant that as head of
the Department of Justice, Charles B. Warren, if confirmed, would
be in a position to dispose of his own anti-trust case. 6
To Couzens, this appointment by Coolidge was another McNary
case. Just as he had opposed Harding in that appointment, he now
opposed Coolidge. As the Republican senator from Warren's home
state, Couzens' stand was crucial. When the Judiciary Committee,
following custom, requested his expected approval of Warren's nomi
nation, he declined to give it. “Mr. Warren is an able and shrewd
lawyer," was all he would say. 7
Tremendous pressure was exerted to win him over to Warren.
For by then Warren had become an important contributor of Re
publican campaign funds. Harding had sent him to Tokyo as United
States Ambassador, and he had served Coolidge well as a floor leader
in the Republican convention of 1924. 8 Warren himself made a per
sonal appeal to Couzens, on the basis of “old days" and local pa
triotism. The Michigan and Detroit bar associations flooded Couzens’
office with telegrams in Warren's behalf. Coolidge himself exerted all
possible White House influence. 9 In the judgment of William Allen
White, Coolidge, who had all the facts about Warren, “was stubborn
to his own hurt and without much principle involved." 10
To his face Couzens told Coolidge that he simply “could not
stomach" Warren as Attorney General. There was no use in pres
suring or cajoling him.
On the original Senate vote, there was a tie. Vice President Dawes
might have broken the tie in Warren's favor, but he was absent,
supposedly taking a nap in the Hotel Willard. By the time Dawes
was summoned, the confirmation was rejected.
Then, obtusely, Coolidge re-submitted Warren's nomination. This
appalled even Chief Justice Taft, who wrote to his son, Robert, in
complaint about Warren's “subterranean methods." 11


THE CRITIC OF COOLIDGE
177
Couzens was subjected to another barrage. More appeals to his
“loyalty to Michigan” were made. The Michigan Manufacturer and
Financial Record snapped: “No emotion or joy over the promotion
of any citizen of Michigan seems to enter his mind.” 4 * * * * * * * 12
But he remained adamant. He frankly told Warren that he might
support him for some other post, but not for Attorney General. The
public had a right to an Attorney General “above any kind of suspi
cion,” he said. 13 On the second vote, Warren was rejected 46 to 39,
and Coolidge had to admit a galling defeat. 14
During the debate over Warren, the Senate also had been the scene
of considerable acrimony when the Republican caucus determined
to discipline Senator La Follette and Senators Brookhart, Frazier,
and Ladd, who had supported La Follette’s candidacy for President.
The penalty was refusal to recognize them in committee assignments
as Republicans, hence cause them to lose all committee member
ships. 15 Couzens was on the point of entering into that debate, on the
side of La Follette, when he found that he himself was the object of
“discipline.” For this was the moment Secretary Mellon selected to
file against him the $10,000,000 tax case. It was a safe guess that Mel
lon had obtained the President's permission for the action as re
taliation for Couzens’ stand against Warren.
4
Couzens himself broke this news on the Senate floor. “Mr. Pres
ident, I want to point out that all party discipline is not administered
in the Senate. Party discipline is administered throughout the states
and party discipline is administered in the Departments of the
Government here. . . .”
Whereupon he told his colleagues of the tax suit, and read into the
record the complaint filed against him. The action, he said, was taken
because “the senior senator from Michigan has not been regular, and
because he has persisted in endeavoring to eliminate rottenness in
governmental departments, no matter under what administration
it may occur.” 16
Immediately there was a new furor, one that almost overshadowed
even the Warren controversy, as various senators rose to denounce
the action against Couzens, and others as stoutly went to the defense
of Secretary Mellon.
Senator Ernst was among those who went to Mellon’s defense,
and brought against himself from Couzens the charge that he had
played a part in filching certain papers from the committee’s files.


THE SENATOR
178
This accusation caused Senator Ernst to make an outburst destined
for parliamentary anthologies. “I want the chair to tell me,” he cried,
“whether there is any way under the rules that I can call a fellow
senator a willful, malicious and wicked liar!”
Carter Glass had just taken the floor, and thought Ernst was re
ferring to him. “I want to know whom he is calling a liar!” Glass
cried.
“That’s just what he can’t do; he can’t call anybody a liar here,”
ruled the presiding officer, Joseph T. Robinson, to the amusement
of the whole chamber. 17
Couzens told the Senate that he considered the Mellon action an
effort to intimidate him in the investigation.
“Will it have any effect upon the further investigation of the Bu
reau of Internal Revenue?” asked Kenneth McKellar of Tennessee.
“It will have a most vital effect,” answered Couzens. “The Senator
from Michigan will be more energetic than ever in prosecuting the
investigation!” 18 It did not displease him that a few months later
Kentucky voters unseated Senator Ernst in favor of Democrat Alben
W. Barkley, later Vice President under President Harry S. Truman.
?
Another squall developed when Coolidge disapproved of legisla
tion for raising salaries of postal employees. Couzens fought for the
legislation. Economy at the expense of human beings was false
economy, he maintained.
Coolidge called Couzens to the White House. The result was an
encounter that left the President sputtering with anger.
“A postman cannot raise a family on $1,500 a year,” said Couzens.
“In Northampton, Massachusetts, you can have a first-rate house
to live in for $30 a month,” answered Coolidge.
“That’s no argument!” snapped Couzens. “All of our postal em
ployees can’t live in Northampton, Massachusetts!”
“I had an uncle in Northampton,” continued the President. “He
sent his children through high school and college and he never made
more than $1,500 a year in his life.”
Couzens banged his fist on Coolidge’s desk. “That’s the trouble
with you, Mr. President!” he roared. “You have a Northampton
viewpoint, instead of a national viewpoint!”
The interview came to an abrupt end. Couzens had gone to the
White House in the first place mainly to urge the appointment of


THE CRITIC OF COOLIDGE
*79
Governor Groesbeck for Attorney General, but never even got to
that. 19 A conservative Vermonter, John Garibaldi Sargent, was ap
pointed to succeed Harlan Stone. 20
6
Couzens also bitterly criticized the administration for its treatment
of General William “Billy” Mitchell, who was ousted from the Army
in 1924 because of his advanced views on aviation power. 21
He was openly contemptuous of the U.S. State Department then
headed by former Senator Frank Kellogg, whom some called “Nerv
ous Nellie,” for its refusal to permit a member of the British Parlia
ment, Shapurji Sakatvala, a Communist, to enter the United States
to attend a conference of the Inter-Parliamentary Union, an early
instance of what, in a later era, would be called lowering an “iron
curtain.” “The idea that this great United States is afraid to let one
man come into this country just because he believes in a form of
government different from ours is the greatest joke imaginable. Are
we afraid of one man among our one hundred million?” Couzens
asked. 22
In 1926, he stirred a storm in Detroit over a similar issue. The
industrial department of the Detroit Y.M.C.A. had invited William
Green, president of the American Federation of Labor, to talk there.
The board of directors of the “Y” ordered that Green’s appearance
be cancelled. Couzens was so indignant that he advised the Detroit
Community Fund, to which he was a leading contributor and which
helped support the “Y,” that unless the ban on Green were with
drawn, he would not make his annual contribution. At the same time,
he resigned in protest as honorary chairman of the Community
Fund. 23
All along, in the meanwhile, he kept up a constant fight with
Secretary Mellon. In March 1928 he introduced a resolution calling
upon Mellon to resign from the cabinet, charging him with “con
tempt for the law.” 24 Mellon did not resign, but there was another
fine fight. 25
7
But by and large, these actions did little to disturb the national
calm. The Bull Market was on in earnest. “Don’t sell America short!”
Arthur Brisbane wrote day in and day out in the most widely syn
dicated newspaper column of the period. Though some economists


i8o
THE SENATOR
(later) would conclude that precisely in the period 1925-1927 things
happened in the economy in America, and abroad, which assured
disaster ahead, almost everyone was in an euphoric state. In the phrase
of John Kenneth Galbraith of Harvard, in looking back at 1925
through 1929, from the vantage of 1955, the Coolidge Bull Market
was a “remarkable phenomenon. ,, 26
True, there were some happenings which even to the layman did
not seem to blend wholly with assurances of good times without end.
In England there had been general strikes. In Italy there had oc
curred the Fascist march on Rome. In Germany the Weimar Re
public was tottering, despite a Dawes Plan and a Young Plan. Even
in the United States, there had occurred the Sacco and Vanzetti case,
revealing that, seemingly, down underneath, there was not the con
fidence in the social order that most of the nation's leaders professed
to have. Yet, the over-all atmosphere was one of satisfaction on the
part of nearly everyone.
The independent man in politics does not flourish in such an
atmosphere. Nor does the man of action in public life. There was
not much business of importance before the Senate. So when his
committee for investigating the Bureau of Internal Revenue had
finished its work, Couzens found time hanging heavy on his hands.
He began to suffer acutely from ennui. In this mood, he wrote self-
analytically, and with considerable insight, to his daughter Mad
eleine:
“With no physical disabilities for twelve whole days, I still am
not contented. What a queer character. . . . Strange incongruities
to exist in one human being." 27


181
CHAPTER XXVIII
THE RESTLESS STATESMAN
He knew what was missing. Back in the time when he was mayor,
a group of newspapermen one day asked him for a definition of suc
cess in life. “Contentment and peace of mind, something that comes
from within you,” he said. “I sometimes think that I will never find
them for myself.”
He certainly tried to find them. His whole career, in one sense, was
a monument to that search. But aside from the material results, what
he had attained was not contentment, he said, but “the forgetfulness
that comes from work.” 1
Now in the slow pace of his senatorial duties, in the Coolidge
period of the “Golden Glow” even this balm was denied him and he
was often wretched about this.
2
There was, of course, the outlet of Washington social life. He did
participate in this social whirl, and with enjoyment—much more
than he cared to admit. “Invitations” naturally poured in on him and
Mrs. Couzens, because of themselves, but of course also because of
their wealth—and the lovely daughters.
On their part, they did considerable entertaining in the various
handsome residences they occupied while in Washington. First, they
lived in the former Newberry house on Massachusetts Avenue.
Then they moved to the former Senator Freylinghuysen place on
Sixteenth Street (later the site of the Hotel Statler). But Couzens
was so sensitive to even slight traffic noises at night that, in spite of
all those rooms, he had to fix up a bedroom for himself—in a clothes
closet. So they moved to still another Washington residence in the
gladed Rock Creek area.
They were frequently at the White House on social calls—re-


182
THE SENATOR
markably frequently, considering Couzens' status as an insurgent.
But there, too, he found that wealth was a door-opener, as he had
discovered in Detroit in the early days of the Ford success. Besides,
perhaps oddly, Calvin Coolidge liked the Couzens society if not the
Couzens politics. It would be stated that Coolidge was so impressed
with business success—“The business of America is business," he had
said about this time—that he could forgive Senator Couzens' po
litical irregularities, even against himself, in view of the Couzens
wealth. And the Couzenses, as did everyone, enjoyed having easy
entree to 1600 Pennsylvania Avenue.
Besides, while he never came to like Coolidge's political and social
views any more than Coolidge came to agree with his, Couzens also
developed a certain real affection for Coolidge, the man, enjoying
especially his unostentatious, even homely, ways. They got so that
they could discuss divergent views frankly, without a blowup. “I
admire Coolidge," Couzens wrote to Vandenberg. “I do not believe
he admires the sycophant who bows, scrapes and dances to please
him. There are men of that kind, but I do not think he is, and cer
tainly I could not be that kind of a fellow even if I were told I had
to be to enter the Kingdom of Heaven." 2
3
He found pleasure, too, in his daughters, observing with fatherly
pride their maturing. He and Madeleine developed an especially
tender relationship that was wonderfully satisfying. After having
finished her course at the Bronson school in New York, she delighted
him especially by undertaking to do what he himself once had wanted
to do—study law.
As a student at Washington College of Law, she followed closely
the legislation in which he was interested, and frequently was to be
found in the visitors' gallery of the Senate listening to the proceed
ings. Madeleine and he, walking to and from the Capitol, became
a familiar sight, and their walks together were among his most
cherished activities.
When Madeleine was away, he wrote to her in a warm, affectionate
way that probably surprised even himself, considering his reputation
for being cold-blooded. He once told a friend that he had trouble
all his life “to say what I feel in my heart." 3 But this was not true
between himself and Madeleine.
In one letter he wrote:


THE RESTLESS STATESMAN
183
You are well and happy, so I am pleased, although no one but
myself knows how much I miss you. Something keeps you in mind
every hour of the day and in many of my dreams. I miss seeing you
in the Senate gallery and I miss your cheery welcome when I come
home. All this even though I have a loving wife and two sweet and
loving daughters still with me. . . . 4
At this time he joined the Burning Tree Country Club and be
came one of the most avid and best-known golfers in Washington. 5
He also developed intimate friendships with other senators, most of
all with Charles L. McNary of Oregon (the 1940 Republican can
didate for Vice President with Wendell L. Willkie), and with Pat
Harrison of Mississippi, Frederick Hale of Maine, and Hiram John
son. 6 This camaraderie was something he had never permitted him
self in his earlier years.
However, in none of this outwardly pleasant life did he find the
complete cure for his restlessness. He simply had developed no
philosophy that permitted him to accept, let alone welcome, a calm
existence. He did much thinking and reading—the Nation and the
New Republic being his favorites among magazines. But actually the
contemplative life was foreign to him.
He kept religion at arm's length, perhaps, as he once said, be
cause “there was so much religion at home in Chatham." So nearly
all he had to fall back upon, since he could not indulge in just pleas
ure, was his old formula, “making good."
4
Twice he came close to returning to the business world. Just after
his election in 1924, Joseph P. Tumulty, who had been Woodrow
Wilson's secretary, informed him that the Washington Post could
be purchased from E. B. McLean for $6,000,000. To own a newspaper
in the capital appealed to Couzens. He became seriously interested,
and Tumulty was eager to act as broker.
However, McLean's well-known eccentric ways—oddities that
finally caused him to be committed to a sanitarium—were a stum
bling block. He refused, for example, to submit any kind of financial
statement. Nor would he answer a series of specific questions con
cerning the property that had been drawn up for Couzens by Jay
Hayden. He stubbornly took the attitude that if Couzens wanted
the Postj he should buy it without asking questions. The farthest he
would go was to give a “warranty" that the newspaper was “profit-


THE SENATOR
184
able/' Couzens then refused to have any further dealings with Mc
Lean and gave up entirely the idea of acquiring the Post. 5 * 7
In 1926, he actually launched another commercial enterprise of
his own—the Couzens Ice Machine Company, which he capitalized
at $1,000,000 for the purpose of producing mechanical refrigerators.
His principal motive, he said, was to assure a fitting career for Frank,
then in the house-building business in Detroit with John P. Frazer.
There was an impulsiveness about this whole matter which indicated
how desperate he was to be in “something active." When Wilcox, his
lawyer, warned him that it might be wise to check the status of patents
on mechanical refrigerators, he brushed the warning aside.
“Nonsense. We’ll go ahead and fight out the patent trouble later,
as we did in the Selden case."
It was also suggested to him that there be more testing done, but
he vetoed this too.
“If we did that in the beginning of the Ford Motor Company,
we never would have gotten any place. The thing to do is to start
production and make improvements later."
Two factory sites were purchased, one in Detroit, and another in
Wapokeneta, Ohio. Dealers were signed up. Literature was printed.
Sample machines were displayed in stores. Then, just as the company
was preparing to go into production, he suddenly called the whole
thing off, at an enormous loss. 8
5
He had been studying the installment purchase system. Installment
buying and selling were bad for people morally, encouraging them
to live beyond their means, and even worse for the nation econom
ically, he concluded. He became something of a crusader on this
view, made several speeches about it, and also contributed several
magazine articles in which he warned that the system was bound to
lead to a crash 9 —one of the few warning signals sent up during
this era of euphoria. And he had been advised that it would be im
possible to market the Couzens refrigerator except on the installment
plan. Rather than do that, he determined to kill the enterprise en
tirely. At least, this was his excuse. 10
It was just as well. Frank, himself now a father, with one of his
sons named James Couzens II, did not need to have his career
mapped for him. He was already shaping a future quite satisfactorily,
incidentally moving along a path paralleling his father's, for in 1928,


THE RESTLESS STATESMAN
185
Frank became a member of the Detroit Plan Commission. Later he
became a commissioner of the municipally owned Detroit Street
Railway.
By 1929, Frank was to be a figure of status in his own right in
municipal politics. A statement issued by him on the mayoralty cam
paign that year attracted wide attention. “You see, I have competi
tion in the family already/' Couzens told Madeleine. 11
6
Having decided against re-entry into business, Couzens turned
to personal projects. It had been logical for some time that he should
erect a permanent, year-round residence at Wabeek. Soon after he
called off the refrigerator project, he became engrossed in building
a new Wabeek residence, completed in time for it to be the scene
of Madeleine's marriage in January 1928 to William R. Yaw. He
undertook still another construction project, an office building in the
town of Birmingham, Michigan. There he established his personal
office (and, a few years later, the Wabeek State Bank, created mainly
for handling his own financial affairs). It was no longer necessary,
he said, for him to keep an office in Detroit. By having his head
quarters at Birmingham, he would not be disturbed by people
“wanting favors or to sell him something." 12
In the country-squire existence that he began to lead at Wabeek,
there were gratifications in abundance for him. He took to spending
a great deal of his time in the outdoors. He enjoyed puttering around
the estate and superintending farming operations at Wabeek, al
though it exasperated him constantly that he could not make the
farming side of it pay. The feeling of being a great landowner—Wa
beek by then was expanded to some 800 acres—pleased him. Then
in 1929, he launched a project that filled some of the more basic re
quirements of his restless nature and won for him a measure of peace
that had come from nothing else. This was his creation of, for the
era, one of the nation's most important philanthropies, the Children's
Fund of Michigan.


186
CHAPTER XXIX
THE MAGNIFICENT GIFT
Back in 1915, Couzens had written to a friend: “You are quite right,
I have more money than I am entitled to. I am just commencing to
take time to learn how to separate myself from some of it.” 1 That
year Henry Morgan, his secretary, persuaded him to visit a small
home for crippled children in Detroit maintained by a Blanche
Leuven Brown, herself a cripple. He could not get the sight of these
children out of his mind. Almost before he knew it, he became the
principal financial backer of the Brown home, giving it $10,000 in
1915. And from then on, he began to become a “giver.”
In 1918, he made an interesting alliance. A young man named
Byers H. Gitchell, later a figure in department-store merchandising,
had been talking to him about certain social improvements needed
in Detroit. Gitchell had been secretary of the Board of Commerce at
the time Couzens was its president. Like Couzens, he had resigned
because he felt this commercial group was not “getting behind the
real things that should be done for the city.” 2
To Couzens, Gitchell now sketched an almost pioneer concept of
city planning—better homes for workers, more parks, improved
educational opportunities, better hospital facilities, and more inte
gration of various organized charities. If he could afford it, Gitchell
added, he would like to devote his energies to developing such a
program—this at the time Couzens was thinking of standing for
Mayor.
“All right,” said Couzens. “Go ahead. I’ll pay your salary!” 3
One result of this was the creation in 1918 of “The Detroit Pa
triotic Fund,” forerunner of the Detroit Community Fund and
Community Chest. Couzens was its leading contributor, his gifts
averaging $150,000 a year. For several years he served as president
of the fund and was the dominant influence in its administration. 4
It was he, too, who was chiefly responsible for having brought to


THE MAGNIFICENT GIFT
187
Detroit, from the Cincinnati Council of Social Agencies, William
J. Norton, a hardheaded yet progressive and liberal-minded Maine-
born social worker, to serve as founding director of the Detroit Pa
triotic Fund—thus beginning for himself, as well as for Detroit and
Michigan, an important relationship.
2
In 1919 Couzens gave a $650,000 nurses’ residence to Harper Hos
pital of Detroit. In that same year, as a birthday present to Mrs.
Couzens, he made a gift of $1,000,000 for the furtherance of what by
then was his great hobby, the helping of crippled children. This
donation was really an outgrowth of his interest in the Brown home.
He had become a member of a committee (along with Alex Y. Mal-
comson) for converting the Brown home into a scientific institution.
Largely on his initiative, it was merged with the Michigan Hospital
School. 5 Later, he was instrumental in effecting a merger of this
Michigan Hospital School with the Children’s Free Hospital of De
troit. When this was achieved, in 1922, and there came into being the
Children’s Hospital—the word “free” was eliminated as “distaste
ful,” at his insistence—he donated an additional $1,000,000, which
was used, among other purposes, to create the hospital’s famous
countryside branch at Farmington.
5
He liked to say that helping children was a matter of “absolute
justice,” not sentiment, as he once wrote to Norton.
But no man could have been more sentimental than he over the
plight of deformed youngsters. He suffered actual pain at the sight
of a crippled child, or even if he merely read about such a child.
Morgan once sent him a pamphlet describing the work of an organ
ization for helping cripples. Before returning it, Couzens wrote on it:
“I’m glad you showed me this, but it has spoiled my day.” 6 And
this at a time when other leading Detroiters insisted he was “cold
blooded” and “unfeeling.”
In 1924, he donated still another residence for nurses, this time to
the University of Michigan, at a cost of $620,000. In this same year,
he established a $100,000 fund for making loans to physically hand
icapped war veterans, primarily to help them “make a start in a self
supporting business in a manner which will enable them to maintain
their self-respect.” 7


i88
THE SENATOR
The idea for this came to him after a crippled war veteran had
come into his office at the Senate and asked for a loan of fifty dollars.
Couzens had abruptly turned down the veteran, saying a casual loan
“would do no good.” But after a sleepless night he set up the $100,000
fund.
His great philanthropy, however, was the Children’s Fund of
Michigan.
Over a long period, he had discussed his plans for this with Dr.
Freund, his personal physician, with Norton, and with his lawyer,
Judge Arthur J. Lacy, formerly of the Court of Domestic Relations,
then with John Anderson’s firm. 8 He reached his decision to act just
after Madeleine’s first child, Margot Yaw, was born. A letter to her
gave a hint, but only a hint, of his decision. She had asked him to
come to Detroit from Washington to see his new granddaughter
sooner than he had planned.
“I want Frank to be there when I come to Detroit,” he wrote. “I
have something important to do and want Frank present.” 9
The “something important” was the Children’s Fund.
Its purpose was told in the carefully selected words of the trust
instrument:
“To promote the health, welfare, happiness, and development of
the children of the State of Michigan primarily, and elsewhere in
the world.”
He started the Fund with an irrevocable gift of $10,000,000. Later,
in November 1934, he added $1,880,700. Counting income as well
as principal, the gift resulted in the expenditure, as of its final re
porting date, May 1, 1954, of $18,038,656.36. In later years, after
other wealthy men had seen the desirability of establishing welfare
foundations (also after money values had become inflated) this sum
perhaps would not seem extraordinarily remarkable. But at the time,
his gift was sensational and amounted to one of the fifteen largest
publicly listed charitable trusts. 10
For him, the Children’s Fund represented a broadening of his
interest in the welfare of children. Though still greatly concerned
with helping physically handicapped children, he now desired to do
his part for the benefit of children generally. In 1935, he summed
up his views:
I know of no greater obligation resting upon the adults of a
civilized nation than the application of their love for their children


THE MAGNIFICENT GIFT
189
in those practical, organized ways which guarantee that each gen
eration . . . will have progressively greater opportunities of ar
riving at manhood and womanhood better equipped for life’s contest
than their predecessors had.
Science contributes year by year a constantly enlarging stream of
knowledge of how to keep the body well, how to cure sickness, how
to train the mind for more efficient performance, and how to mold
the character for strong and resourceful struggle against odds. It
is a major business of adult mankind so to organize this growing
fund of knowledge and so to apply it that more and more children
will be able to start the race of life without handicaps and on even
terms. 11
5
He stipulated that all of the money in the Children’s Fund must
be expended within twenty-five years after May 1, 1929, and that,
on the average, at least $700,000 was to be distributed each year.
Permanent foundations, while pleasing to the vanity of men who
wanted their names remembered in perpetuity, tended to defeat their
purpose, he felt.
He also made it clear that the least possible portion of the Fund
was to be used for buildings of any kind. Not monuments to himself,
but effective activity for children, was his goal.
Indeed, he leaned over backwards in this. When he donated the
nurses’ home to Harper Hospital, he refused to permit it to be called
“The James Couzens Home,” as was proposed by the hospital board.
“He would not hear of it,” related Dr. Stewart Hamilton, director
of the hospital. He asked that the home be named after the then
principal nurse of the hospital, Emily A. McLaughlin, in tribute to
her service in France during World War I. 12
He was positively indignant upon learning that the University
of Michigan authorities had designated the nurses’ home he had
given that institution as “The Couzens Residence for Nurses.” 13
He held to this principle always. In the notes of Arthur J. Lacy,
who, with Clarence Wilcox, handled the legal matters involved in
setting up the Children’s Fund, there appears this:
We tried to induce Senator Couzens to call this the Couzens Foun
dation, but he refused to have his name included. He said the
fund belongs to the children. ... He said it is not where it comes
from, but where it is going that is important.
He insisted too, that there be no racial or creedal discrimination of
any kind. “I have never felt justified in contributing to any particular


igo
THE SENATOR
creed, color, or race, and I am anxious to see that all are treated
alike,” he once said. 14
He participated directly and actively in all that the Fund did so
long as he lived. He had himself designated as chairman of the board
that was formed to administer the Fund. No detail in planning or
execution was too small to command his interest, as the work of the
Fund progressed. He wrote ‘‘voluminous letters from Washington”
about it to its officers. 15
6
The original board of trustees, of which Frank Couzens, as well
as himself, was a member, was carefully chosen by him. All were
men who knew his views, who were definitely interested in social
welfare—Lacy and Wilcox, McPherson Browning, a Detroit banker,
Dr. Freund, and Norton.
Dr. Freund, a physician of unusual social and psychological in
sight, was exceptionally well qualified to be Couzens’ adviser in this
field. Aside from the experience that came from a large medical
practice, he was well grounded in public-health work, having been
a member of the Detroit Board of Health for a number of years,
under Couzens as well as other mayors. He was interested in research.
Perhaps most of all, Dr. Freund concerned himself with the general
problem of mental health, and he was a doctor interested in social
conditions. He was named president of the Fund and much that the
Fund accomplished bore the impress of his broad and informed in
terests.
Norton was well acquainted with Couzens’ views because of their
close association with the Community Fund. A true humanitarian,
yet levelheaded and practical—outstandingly so among welfare
workers—Norton was precisely the man for operating director.
Couzens “drafted” Norton to serve as executive vice-president and
secretary. At first this was on a part-time basis, with Norton con
tinuing with the Community Fund. Then Norton made the Chil
dren’s Fund his full-time career. He and Couzens made a superb
team.
7
The Children’s Fund adopted and followed two main policies
from the beginning. It decided to support selected activities of al
ready existing agencies in the children’s field. It initiated activity


THE MAGNIFICENT GIFT
of its own in more or less neglected fields, but always with the thought
that this activity ultimately would be carried on by some other
agency, preferably by state or local governments. Thus, the work
of the Fund would go on, even though the Fund itself was to cease
existence after twenty-five years. In this respect the Fund was a trail
blazer. 16
Michigan was a backward state with respect to public-health work
in rural areas when the Fund was established. Numerous counties
had no public-health facilities at all, not even the minimum services
for inspecting water supply or controlling communicable diseases.
To correct this lack became a major objective of the Children’s Fund.
Its approach was to offer financial support to selected counties, by
which health officers, nurses, dentists, and sanitary inspectors would
be employed, provided the counties established health districts.
The Fund constructed and undertook the operation of two chil
dren’s clinics outside Detroit—the Northern Michigan Children’s
Clinic at Marquette, and the Central Michigan Children’s Clinic
at Traverse City. Serving large areas, these clinics made available
medical services including orthopedic treatment of cripples, that
previously were unknown to rural children. It also maintained a
laboratory, mainly in the field of biological chemistry, where scien
tists launched studies in problems of nutrition and of growth, with
the view to finding means of improving the physical well-being of
children everywhere. This laboratory, in which the offices of the
Fund were located, was constructed adjacent to the Children’s Hos
pital, in accord with Couzens’ plan that ultimately it should be a
gift to that hospital, so that its work would continue after the Fund
had expired. The executive headquarters and laboratory building
were deeded to Children’s Hospital when the fund was liquidated on
April 30, 1954.
In Detroit there was established the Children’s Center, staffed
by psychiatrists, psychologists, and psychiatric social workers, who
specialized in treating maladjusted children. With the cooperation
of the state, a similar center was established at Lansing, Michigan,
to bring the value of mental-hygiene work to the attention of the
state at large. In addition, the Fund sponsored a program for ac
quainting teachers in the public schools with advances in the under
standing of juvenile personality problems.
Some twelve years later, the Michigan legislature authorized the
State Hospital Commission to establish three child-guidance clinics


igs
THE SENATOR
—at Muskegon, Kalamazoo, and Saginaw. This meant that the Chil
dren's Fund had played a vital role in fostering acceptance of a pro
gressive step in public health, and that its work in an important
field would go on. Indeed, it had sparked many such activities and
encouraged gifts in its field by other persons and foundations.
Couzens himself once summarized accurately its work:
New services for health, new implements for self-discipline, and
an enlargement of scientific knowledge have come into being with
our assistance. And we have entered practically into the lives of hun
dreds of thousands of children to their happiness and advantage. 17
8
Nothing that he had ever done—not his role in the building of
the Ford Motor Company, nor the winning of public office—gave
him more real pleasure. A tabulation of all his contributions—count
ing the Children's Fund—showed an interesting total, approximately
$30,000,000, or precisely the sum he had received for his Ford Motor
Company stock. 18
The mail he received from all over the nation from persons pleased
by his gift “has been terrific, like a cyclone," he told Madeleine.
“I have taken the trouble to personally answer each letter." 19
In the following June, while at his desk in the Senate, he wrote
her an interesting personal letter.
I just happened to observe that I was getting older and shrinking
up. When I went shopping for some shoes and stockings the other
day, my sizes had to be reduced. Socks for me for years were ten and
a half, but now I have to have size ten. . . . Keep well and keep
your temper and disposition sweet; it pays immensely, in spite of
the fact that I have not practiced it! 20
If he was getting old and “shrinking up," this by no means in
dicated an easier, more relaxed time ahead for him. Actually, one
of his most active periods lay just ahead. For a vast change was to
occur in the American scene—and there was work aplenty for a pub
lic man with a sensitive conscience.


193
CHAPTER XXX
THE ‘‘DANGEROUS MAN”
His Children's Fund gift was cited in many quarters as proof of the
healthy working of the American economic system. By coincidence,
however, the system was just then on the eve of a great spell of sick
ness, the first symptom of which was a pronounced rise in unemploy
ment.
Nearly everyone dismissed this trend in the latter days of the
Coolidge Bull Market as something that would pass. Secretary of
Commerce Herbert Hoover had been elected President in the pre
vious November. During his campaign he had said hopefully: “We
in America today are nearer to the final triumph over poverty than
ever before in the history of the land." 1
Couzens was not so sure of this. Indeed, as early as 1924, he wrote:
Notwithstanding the abundance of everything in this country,
we never seem to have devised a way to create security for those
“have nots” who are willing to work. ... I have unbounded con
cern for the family man who has no security in a job. This is the
one outstanding problem to be solved. 2
In 1926, when he was studying the installment-buying question,
he said, “I am sorry that so much publicity is given to universal pros
perity that does not exist." 3 In February 1927 he told Frank Couzens,
“Times are not too good and it is my impression that they will be
worse before they are better." 4
During Coolidge’s last days in the White House, Couzens warned
the President that danger existed in the widespread stock-market
gambling, especially in banking securities. 5
On the Senate floor he sharply criticized the Federal Reserve Board
for encouraging “a great orgy of speculation." This, he said, was
a “dumb" policy that could only end in disaster. 6


*94
THE SENATOR
2
Early in 1928 along with “Young Bob’’ La Follette, he persuaded
the Senate to authorize an investigation into unemployment. As
chairman of the Committee of Labor and Education, he took charge.
The result was a Senate report that became a significant document,
a kind of American “Beveridge Report,” which called attention to
the need for unemployment insurance and old-age pensions. 7
In one respect this document was historic. It endorsed a principle
that was not to become part of the doctrines of progressivism in the
United States until after World War II—that, under democracy,
men have a right to self-supporting employment. In the main, this
doctrine was Couzens’ personal contribution. His report said:
No one will question that every man is entitled to the opportunity
to provide for himself and his family. That is a fundamental right
and society cannot consider itself successfully organized until every
man is assured of the opportunity to preserve himself and his family
from suffering and want.
The report also said:
Cyclical unemployment has been like the plague; it has come and
gone at regular intervals until it has been accepted as a necessary
evil by some who should know otherwise. . . .
We do not believe any more that it is necessary for the baby to
have diphtheria and rickets and other “diseases of childhood.”
We have found and are finding methods of preventing these dis
eases. We should recognize also that there is an obligation on all
society to attack, unceasingly, the problem of unemployment. 8
His report included two recommendations of great significance
later:
The government should adopt legislation without delay which
would provide a system of planning public works so that they would
form a reserve against unemployment in times of depression. States
and municipalities and other public agencies should do likewise.
Future consideration might well be given to two questions, the
effect had on unemployment by industrial developments such as
consolidation of capital, and the necessity and advisability of pro
viding, either through private industry, through the states, or
through the federal government, a system of old-age pensions.®
And all this, of course, before the “New Deal” and the social se
curity program that came with it. As a Senator, he was again the trail-


THE “DANGEROUS MAN”
*95
blazing industrialist that he had been in 1914 when it was he who
pushed through at the Ford Company the $5-a-day plan and also,
as in 1915, had urged upon the Detroit Board of Commerce a policy
which, in effect, meant a guaranteed annual wage.
He engaged in a good deal of correspondence with key industrial
ists throughout the nation upon these problems. To a businessman
in Connecticut, who had objected that relief funds did not get at
“fundamentals,” Couzens wrote:
That is true, but . . . relief has got to be had while we are attack
ing the fundamentals. I, for one, am unable to see the suffering that
goes on while we are trying to find the basis of permanent relief. 3 * * * * * * 10
This was in May 1929—before “the Great Crash.”
With George W. Johnson, the shoe manufacturer, he carried on
a correspondence in which he championed a favorite idea. Industry
must undertake payroll-stabilization plans for ending seasonal and
cyclical unemployment. “That means,” he said, “the arousing of the
consciousness of the employer to the necessity of doing for his em
ployees what he does for his plant and his stockholders.” When John
son argued that it was necessary to go slow, to learn by experience,
Couzens agreed. “But we must not let too many people suffer while
we are gaining this experience.” 11
It was then, in 1925, that he began to speak out strongly for a
proposal which other progressives were not to espouse seriously until
a quarter-century had passed: The guaranteed annual wage for in
dustrial workers.
In short, he was for scrapping the old-style wage system entirely,
and substituting the annual salary for all men and women in indus
trial employment. Especially did he recommend this for the great
automobile industry, which he had helped to found.
3
The stock market collapsed in October 1929. The Commercial &
Financial Chronicle called the result “the greatest stock market ca
tastrophe of all ages.” 12
President Hoover, however, assured the country that all was really
well. “The fundamental business of the country ... is on a sound
and prosperous basis,” he said. 13 But this was whistling in the dark.
The “great depression” was on, 14 though The Literary Digest called
it a “prosperity panic.” 15


THE SENATOR
196
In the following December Couzens addressed the annual dinner
of the Michigan Manufacturers Association at Detroit. By then the
depression had unmistakably set in. Fifteen years almost to the day
after his memorable address on unemployment before the Detroit
Board of Commerce in 1914, he repeated almost word for word what
he had said then about the irresponsibility of employers toward their
workers. By failing to act, the manufacturers were, in large part, to
blame for the unemployment, he said, adding that low wages had
reduced the needed purchasing power of the people.
He chided the business leaders for opposing increased taxes for
unemployment relief and for their slogan, “No government inter
ference in business!”
You can prevent these high taxes. You can prevent bureaucrats
from interfering with progress and development of business. You
can prevent officials from sending out forms by the bushel for you
to fill out and return—if you will solve these problems yourselves.
Government does not interfere with business until business itself
has created the necessity. 4 * * * * * * * * * * * 16
Now he was no longer bored. Once again he was the crusader,
constantly plumping for what he saw was the only sound solution of
the unemployment problem—adoption, by basic industries, of the
annual wage for factory employment. And he was more realistic in
assessing the causes and the extent of the “crash” than nearly every
one else in the land. 17
4
In 1930 he stood again for re-election. Then it was not much of a
handicap that he had not gone along with Coolidge. Indeed, by 1930,
this was almost in his favor, even with Republicans.
A suggestion of the change in the land was personified in Vanden-
berg. Back in 1927 the quiet Senator Ferris had died, and Vanden-
berg was appointed to the vacancy. Now himself a senator, Van-
denberg was not so completely Hamiltonian as he had been in 1924,
when he was so certain that La Follette intended to undermine
America. At first, he and Couzens did not get along well in the
Senate. “I did not want you appointed. I think you are too conserva
tive,” Couzens frankly told Vandenberg just after he was sworn in. 18
But by 1930 Vandenberg was more sympathetic toward even mild
“La Folletteism,” although he would never come to be styled a
progressive himself. 19 Frank R. Kent said that Vandenberg took on
“a progressive coloration . . . largely to keep Jim Couzens off his


the “dangerous man” 197
back.” 20 If true, this was a straw in the wind indicating that even
among orthodox Republicans the old order was giving ground. It
had to, for this depression was vastly more severe than any the na
tion had known.
5
So it was no surprise that Couzens this time won renomination,
easily defeating the highly popular former Bull Mooser and ex
Governor, Chase S. Osborn. The Democrats had no more heart
to campaign against him now in 1930 than did the troubled Old
Guard Republicans. They considered not even putting up a candi
date against him. Thomas E. H. Weadcock, a former Congressman,
who finally did consent to run as a Democrat, polled only 139,814
votes in the election. Couzens received 520,247.
This vote of confidence—with many of the regular party leaders
backing him, at least passively—did not cause him to change his
style as the Senate's gadfly. The Baltimore Sun in March 1931 carried
an item that showed that he was still the old Couzens.
He likes Hoover personally and politically [wrote Frank R. Kent,
with tongue in cheek] and has consistently voted against him in the
Senate only because Hoover happened not to think the way he
thinks. Actually, Couzens thinks he has been helping Hoover. It
would be interesting to know what Mr. Hoover thinks.
One of the early votes Couzens cast against Hoover was on the
appointment of Charles Evans Hughes as Chief Justice, to succeed
Taft. Back in 1916, Couzens had taken his first tentative step into
the political arena as an elector pledged to Hughes. Now he joined
organized labor in opposing Hughes for Chief Justice because, he
concluded, “Hughes is too conservative.” 21
6
As unemployment continued to rise in the nation as a whole as
well as in the Detroit area in particular, Couzens hammered con
sistently away at two ideas—the unemployed must be given relief;
businessmen were to blame. What had happened, he felt, had re
markably confirmed his long-standing opinion that leaders of busi
ness were no supermen, and that the much-publicized superiority
of the successful was largely myth. As noted by one Washington
writer, he, the multimillionaire, talked more and more “in a way
to make a conservative's blood curdle.” 22
More people listened now to Couzens, fewer to Andrew Mellon.


THE SENATOR
198
Indeed, by then Mellon, with his world apparently going to pieces,
had become, as Thomas L. Stokes wrote, “an uncertain little man
. . . lonely and tragic.” 23
Couzens’ targets now were the leaders of big business, the bigger
the better, in his view. One target became Albert H. Wiggin, chair
man of the governing board of the Chase National Bank of New
York. Wiggin had made the front pages by suggesting two principal
“remedies” for the depression: scale down the war debts owed the
United States by foreign nations, and reduce wage standards in the
United States generally. Sympathetic toward the first suggestion,
Couzens was wrathful concerning the second:
When it comes to a cut in wages and calling upon labor to accept
such reductions, it seems wholly unreasonable, in view of the fact
that one of the difficulties that brought about this depression, and
in my opinion the major one, has been unequal distribution of the
earnings of industry between capital and labor. . . . This should
not be considered, even though the suggestion comes from a great
financial giant such as Mr. Wiggin. 24
He challenged the Chamber of Commerce of the United States
to present a program for relieving economic distress, issuing in 1931
a bitter statement which lambasted business leaders for opposing
social-security legislation—they called it the “dole”—without of
fering a constructive substitute. He took the chamber to task for
its propaganda against “government interference with business” and
its scary pronouncements about the evils of “a dole.”
Congress is warned against a dole; it is warned against unemploy
ment insurance and old age pensions. When capital is idle, it con
tinues in many cases to receive dividends and interest, but I have
heard no complaint registered that anybody has been offended be
cause it was a dole. Why is a dole to men and women more offensive
than a dole to capital? 25
7
In 1928 he had supported Hoover’s election. To be sure, he was
not so active for Hoover as Vandenberg. But he had gone out of
his way to make a few speeches for Hoover’s election. Remember
ing Hoover’s leadership in the Conference on Unemployment in
1922, Couzens believed that Hoover was something of a progressive,
a view that many, even the liberal New Republic magazine, had
shared. He considered Hoover a competent executive, a man of


THE “DANGEROUS MAN” 109
strength, the “Great Engineer,” who knew how to act in time o£
crisis. Moreover, Hoover had once described himself as an “inde
pendent progressive” who objected “as much to the reactionary
group in the Republican party as ... to the radical group in the
Democratic party.” 28
But Hoover was a disappointment to Couzens. The first glimmer
came when Hoover failed to replace Mellon. Couzens had under
stood from Senators Brookhart and Borah that Hoover had prom
ised not to reappoint Mellon. The promise was kept, technically.
Hoover did not reappoint Mellon—he simply let him carry over. 27
Then, Hoover asked Couzens for a memorandum on reforming
the Bureau of Internal Revenue. Couzens prepared a lengthy one
—and nothing happened, except the executive order on publicizing
refunds of more than $20,ooo. 28
His disappointment soon turned to disillusionment and, finally,
into bitter antagonism.
It did not help matters that Hoover, as President, impressed
Couzens as being ponderous and authoritative, the very kind of per
sonality least palatable to him. 29
8
Hoover did not conceal an antipathy on his part toward Couzens.
He frequently went out of his way to single him out for criticism.
Couzens was “a very dangerous man,” Hoover once told a White
House visitor, according to a report that Couzens himself received. 20
This was sad, for Hoover, as well as for Couzens, and for the
country too; for undeniably Hoover was a man of great ability,
and the country would have benefited had he and Couzens been
able, with others, to work harmoniously together toward meeting
the problems of the depression. But between them, as the phrase
“a very dangerous man” indicated, was a great gulf, not only tem
peramentally, but also in social outlook, and this was tragic for the
nation in its larger implications, for it meant a policy of drift, or
government by doctrinaire slogans, when obviously what was re
quired was practical action along the lines that Couzens was urging,
in broad policy if not in detail.


200
CHAPTER XXXI
THE CRUSADER AGAIN
Their first major clash was on the old question of Muscle Shoals.
For Hoover held to the same view on Muscle Shoals that Coolidge
had advocated, that it should not be operated as a government
power project, but should be turned over to private power com
panies, if developed for power at all. 1 In his very first message to
Congress, Hoover denounced the idea of government ownership of
Muscle Shoals with a characteristically unfortunate phrase, calling
it“degeneration.” 2 This was galling to Couzens and he said so.
Early in the administration, he also broke with Hoover over
another issue carried over from the Harding and Coolidge days—
that of the railroads. Then chairman of the Senate Committee on
Interstate Commerce, he had begun an intensive study of the rail
road problem. In principle, he favored a program of consolidations,
for getting rid of unnecessarily competing lines. But at the same
time, he was against combinations which would mean “killings’* on
the part of speculators in railroad securities and the perpetuation
of “watered” capitalizations. He was also on the alert against a pro
gram that would “solve” the railroad financial problem at the ex
pense of the railroad workers. 3
While Couzens’ committee was engaged with this problem, Hoover
came out with a proposal for consolidating all railroads east of the
Mississippi into four systems. 4 Couzens criticized Hoover’s program.
It was solely “a proposal to help the railroads out of their financial
difficulties,” rather than a program that considered the railroad
problem in its larger aspects, he said. He added that the Hoover
program would result in fewer jobs for railroad workers at a time
when unemployment was becoming a major problem. 5
Hoover defended his program and, in doing so, attacked Couzens.
“If Senator Couzens blocks it, that will add sensibly to our depres
sion difficulties,” he said. 6


THE CRUSADER AGAIN
201
Supported by the railroad brotherhoods, Couzens made sure that
the Senate did block the Hoover plan. “A victory very pleasing to
me,” he wrote to Madeleine. 7
Reflecting Hoover’s attitude was the observation made twenty
years later by a friendly Hoover biographer:
The radical bloc in Congress, led by Senator Couzens of Michigan
and supported by the Democrats, defeated the proposal. Their evi
dent purpose was to keep the railway industry demoralized in the
hope that eventually the government would have to take them over.
Socialism was in the air then, as it is today.
This, of course, proved nonsense of a type that would have been
especially irritating to Couzens.
2
On the soldier’s-bonus issue, Couzens again broke with Hoover.
Normally, he was as opposed as anyone else to “veterans’ raids” on
the Treasury, for he had none of the politician’s fear of the so-called
veterans’ vote. But he felt that with the government failing to pro
vide adequate depression relief generally, prepayment of the Soldiers’
Bonus, as provided by the bill in Congress, was a practical, if inef
ficient, way of getting funds to needy citizens who happened to be
war veterans. 8 Hoover, however, took the position that this would
seriously impair the federal credit. He cited Secretary Mellon as his
authority on this.
Couzens was scornful. If the outlay for the bonus would bank
rupt the nation, he asked, what was there to the earlier argument
that Mr. Mellon was “a wizard” in his conduct of the finances of
the country? He unburdened himself in the Senate of a sarcastic
thrust at both Hoover and Mellon:
“In view of the great Secretary Mellon being alleged to have
served under three Presidents, I desire to point out that the fact
is that three Presidents have served under the Secretary of the
Treasury.” 9
When Hoover vetoed the Bonus bill, Couzens was lined up with
the senators who re-passed the bill over the veto. 10
3
He was especially outraged when Hoover advocated a national
manufacturers’ sales tax on all commodities “except necessary food”


202
THE SENATOR
and possibly “some grades of clothing,” as a way to balance the
budget. 4 * * * * * * 11
The sales tax was a “monstrosity/ 1 a levy that mainly hit the
poor, Couzens declared. “When we scratch down below the surface
of this question of a sales tax, we find an effort to get rid of the
income tax.” “Whenever anyone mentions a general sales tax I be
come irrational,” he once wrote. 12
He was a leader in the revolt in Congress that blocked enactment
of the sales tax. 13
To his personal lawyer, Arthur Lacy, who that year was unsuccess
ful Democratic candidate for governor of Michigan, Couzens com
mented acidly on senatorial colleagues who had voted against an
amendment of his to forbid the sales tax and to substitute a 10 per
cent increase in surtaxes on large incomes. “What I think of some
of my colleagues who voted against my proposed amendment could
hardly be dictated to a female stenographer. ‘Wealth/ certainly has
an enormous number of friends, even among those who are not
wealthy. It seems that practically every publisher, nearly every lawyer,
nearly every public official and nearly everyone who has the public
ear is on guard, in defense of ‘wealth/ ” 14
4
But it was over unemployment relief that he found himself in
sharpest division with Hoover. In principle, he believed, with
Hoover, that the federal government should not undertake direct
unemployment relief and that relief funds should be distributed by
the state and local governments. But he parted from Hoover by
vigorously taking the view that relief by whatever means, had to be
made available even by federal handouts, if the need existed, pre
cisely his position during the depression of 1921 as mayor of Detroit.
The victims of the depression could not be fed and sheltered on
political philosophy, he asserted.
To Couzens, the spectre of jobless men, the sight that had caused
him to initiate the five-dollar-a-day plan at the Ford Company, still
was a haunting thing. That his and Young Bob La Follette’s 1928
report on unemployment, urging a social security program, was gath
ering dust did not surprise him. But he did expect Hoover, whose
reputation as a public figure was built largely on his humanitarian
zeal for getting food to the people of Europe during and after World
War I, would come up with some imaginative program for relieving


THE CRUSADER AGAIN
203
similar distress in America. Yet Hoover even opposed a proposal for
appropriating $20,000,000 to the American Red Cross for assisting
the poor in drought areas with food. The President took the position
that it would violate the “American way” and desert the principle
of “private charity” if the Red Cross received support from the
government. 15 To Couzens, this was carrying “rugged individualism”
to absurd lengths.
In August 1931 Couzens was one of several senators who urged
Hoover to call a special session of Congress to enact legislation for
federal funds to be distributed through municipal governments. He
acted after Mayor Frank Murphy of Detroit advised him that the
city was unable to raise funds to provide unemployment relief, that
at least $10,000,000 was needed to tide Detroit over the winter.
“We have played ostrich enough,” Couzens said. “Families cannot
be allowed to starve.” 16
But Hoover refused to call the special session. In his view, the sug
gestion had come from “radicals.” “We cannot legislate ourselves
out of this depression,” he said. 17
Couzens was all the more angry over this because he had just had
a personal experience with appeals to private relief. To meet the
situation in Detroit, he advised Mayor Murphy that he personally
would contribute $1,000,000, if other wealthy men of the city would
contribute an additional $9,000,000. Not only was the $9,000,000 not
forthcoming, but at a meeting called by Mayor Murphy, Couzens
was criticized—for having made such an “embarrassing offer.” 18
In November 1931, over the radio, Couzens spoke out vigorously
against Hoover’s tendency to minimize the seriousness of the depres
sion. “Conditions today seem to indicate the bankruptcy of business
genius and leadership in this country,” he said. He criticized leaders
who “take refuge inside their storm cellars of wealth and tell those
on the outside not to be alarmed, because the country has always
pulled through and will do so again.” 19
5
By the time Congress convened in December 1931 conditions had
become much worse. Even Hoover then admitted that extraordinary
measures were needed and proposed the creation of the Reconstruc
tion Finance Corporation, by which the government would make
available millions of dollars to banks and other financial institutions.
Although reluctantly, he went so far as to recommend that the RFC


THE SENATOR
204
be empowered to loan up to $300,000,000 to states and municipalities
for relief expenditures, if these local units were unable to sell bonds
on their own account in the regular market. 20 Indeed, here was the
real start of the later New Deal. But such concessions by Hoover
came too late.
As 1932 moved forward, the worst fears of Couzens and others came
to pass. Unemployment in the United States reached, according to
some informed estimates, the unprecedented total of 17,000,000 per
sons. Banks by the hundreds failed. The Insull empire in Illinois
collapsed. 21 Farmers in some instances threatened to hang judges
who foreclosed mortgages, in others halted the shipment of farm
products to the cities because of the ruinous prices. 22 In Chicago, the
city police were alerted and held in stations to be prepared for riot
ing. To save the banks there, the RFC loaned $90,000,000 to Charles
G. Dawes' bank, just after Dawes resigned as RFC president. 23
Detroit in particular was shaken. For Couzens, this was doubly
jolting. He had helped to make Detroit the great industrial center
that it had become, one that had attracted thousands of workers. Now,
it seemed, it had all added up to a social disaster.
Although only a few knew it, the banking structure of Detroit was
in a state bordering on collapse. More obvious as to Detroit's distress
was the fact that the Ford plant closed down.
With amazement, Couzens read the startling news. Ford had even
abandoned the five-dollar-a-day plan! No longer was it true that “the
commonest laborer who sweeps the floor shall receive his five dollars
a day." Instead, the minimum rate for common labor was cut to fifty
cents an hour, or four dollars a day. 24 In May 1932, 80,000 unem
ployed workers gathered in Cadillac Square, in front of the Detroit
City Hall, for a demonstration to demand action by the government.
Not long after this there occurred a riot at the Dearborn plant of
the Ford Company in which four men were killed. 25
A number of magazines and newspapers carried sober articles that
discussed whether or not America was on the verge of revolution,
and how a revolution might be staged. 26 Dwight P. Morrow, a House
of Morgan partner turned United States Senator from New Jersey,
wrote: “Most of my friends think the world is coming to an end." 27
Couzens' reaction to all this was more indignation. In his view,
many of the individuals who then talked of the “need" for a Mus-


THE CRUSADER AGAIN 205
solini, or who were fearful of a revolution, were the very ones who
had produced the crisis.
7
His attitude in this respect was considerably reinforced by the re
sults of an investigation, begun in December 1931 by the Senate
Finance Committee, with his participation, which examined pro
cedures used by American banking and investment firms in the
floating of foreign loans. A legislative result was the Johnson Act
of 1934, which barred the sale in the United States of the bonds or
securities of any foreign government which had defaulted on the
payment of its debts to the United States. 28
Still another result, indirectly, was one of the most important re
forms of the future New Deal, divorcement of investment affiliates
from commercial banks. But what interested Couzens primarily was
not the foreign-relations aspect of this branch of the securities field,
but the morals and patriotism of the investment bankers. Thousands
of Americans had their savings wiped out by defaults of the foreign
governments whose bonds they had purchased on the endorsement
of leading investment firms. By 1932, more than a billion dollars
worth of foreign bonds, issued by Brazil, Bulgaria, Chile, Colombia,
Ecuador, Greece, and El Salvador, among others, had become all but
worthless. Couzens wanted to know if “world conditions” alone were
responsible, or if, in truth, investors had been swindled. 29
The investigation confirmed his suspicions, he felt. It brought
out that the bankers in certain cases had literally forced loans on
foreign countries, so eager were they for the profit from floating the
resultant securities in the American market. In some cases, the bonds
were sold to American investors after the State Department had
warned that the issuing governments were shaky, politically as well
as financially. Instances were uncovered showing that some of the
most respectable banking houses of the nation were not above using
peculiar, if not illegal, methods. 30
Couzens was especially indignant when it came out that Charles
E. Mitchell of the National City Company not only personally
profited to the extent of $4,418,732 in bonuses for his operations
during the years 1926-1929, but also managed, by the device of sell
ing some bank stock to a member of his family, to avoid paying an
income tax in 1929. 31 His National City Company, as said by Thomas
L. Stokes, spurred on its stocks salesmen “by contests, just as if they


206
THE SENATOR
had been selling soap or vacuum cleaners.” 32 Also, to keep up the
“morale” of its officers, as Mitchell testified, it maintained a “manage
ment fund,” out of which the executives received extra compensa
tion on the basis of the earnings of the company. Couzens wanted to
know if this system of “splitting” earnings did not cause “a lack of
care in the handling and sale of securities to the public.”
“I do not recall seeing it operate that way,” said Mitchell.
“You wouldn’t,” retorted Couzens scornfully. 33
8
It was no wonder that Couzens was even more contemptuous than
ever of the big financiers. He now regularly raised questions about
RFC help to big banks, such as the Dawes bank in Chicago. To him,
the RFC operations smacked of bailing out “banksters” and preserv
ing their undeserved gains, at the expense, he feared, of the general
taxpayers. In July 1932 he proposed a full-dress Senate investigation
of the RFC, but was appeased by the establishment of a select com
mittee with the authority to confer with RFC officials. 31
The bankers, he felt, were the very men who, while aided by the
RFC, opposed, with cries of “no dole,” every proposal to help the
little people of the land who were out of jobs through no fault of
their own. The conviction grew upon him that millions were out of
jobs actually, in large part, through the fault of these same financial
giants. No wonder, too, that their talk of the need for a “dictator”
irritated him.
He was naive in taking up temporarily with an economic fad
called “Technocracy,” and for this he was held up to ridicule. 35 But
at least he did not make common cause with those who welcomed
a dictatorship for America. Back in 1917, in a discussion with a De
troit lawyer, he had conceded that democracies were often inefficient,
but said: “Democracy will never be efficient. ... As long as we be
lieve in democracy, we will have to pay the price, and I for one am
willing to do it.” 36 He had never changed. Not dictatorship, but
more democracy was the answer, he felt, meaning not simply political
democracy, but economic democracy, through more equal distribu
tion of security and income. As he wrote a little later to the editor
of the United States News, when asked to comment on an article by
David Lawrence, that said the great need was a greater dissemination
of knowledge among the people, “This dissemination of knowledge,
I believe, has brought our people to the conclusion that there has to


THE CRUSADER AGAIN
207
be something besides the dissemination of knowledge, and that is
the wider dissemination of this world’s goods, so that the masses may
have some economic security.” 37
P
In the summer of 1931, he began to work in that direction him
self. Recalling the recommendations in his 1928 “Report on Un
employment,” he announced that he hoped to introduce legislation
for a national unemployment-insurance law, one that also would
provide for old-age pensions, despite frequently expressed opposition
by President Hoover to any such government program. The Detroit
Times commented editorially: “He means to work most of the
summer with a view to urging immediate legislation in the next
Congress. . . . With Couzens working for unemployment insurance
and old age pensions, these two reforms appear less remote of real
ization than they once did.” 38
About this same time, Ray Tucker, the Scripps-Howard writer,
dropped into his office. They fell to discussing Hoover’s objections
to spending large enough sums of government money to diminish
unemployment. Couzens told Tucker that even if it meant tripling
the federal debt, the government ought to “make work by building
libraries, museums, highways, bridges, schools, and so forth, even
if they returned no income.”
Tucker was astonished by the boldness of the idea, and asked him
if he, a businessman and millionaire, would stand for quotation. 39
“Sure!” replied Couzens.
“So fantastic was the suggestion at that time,” recalled Tucker,
“that I got an eight-column banner in the New York World-Tele
gram.” He thought that Franklin D. Roosevelt, then Governor of
New York, might have obtained from that story inspiration for his
public-works program after he became President. 40
Of course, Couzens got nowhere with his “fantastic notions.” Such
reforms, he knew, would have to wait for a new administration.
He had lost all vestige of hope in Hoover, though events were
pushing Hoover also in the direction of federal action.


208
CHAPTER XXXII
THE END OF AN ERA
Ahead was the 1932 election. Basically, this election among other
things was a referendum on the Hoover policies on the depression
in general, on unemployment relief in particular. Including many
Republicans, the people plainly were angry with Hoover, rightly
or wrongly. Even so stanch a regular Republican as Frank O. Lowden,
the former Governor of Illinois who had come close to getting the
Republican nomination for President in 1920, instead of Harding,
deserted Hoover, though mainly on the farm issue. When he appeared
in Detroit, Hoover was booed—-something that rarely has happened
to any President in office—and Secret Service men in Detroit feared
for his life. 1 To Thomas L. Stokes, this experience was Hoover’s
“Calvary.” 2
The Democratic candidate was Governor Franklin Delano Roose
velt of New York, who in 1920 had been defeated for Vice President
in the Harding landslide.
Couzens liked Roosevelt’s speeches. Indeed, when Roosevelt made
his famous “Forgotten Man” speech, and was attacked for it as a
“demagogue” by former Governor Alfred E. Smith, it was Couzens
who defended Roosevelt in the Senate. “I’m awfully tired of hearing
men accused of demagoguery because they speak out for the little
fellow,” he said. 3 It did not escape him that Roosevelt’s speeches were
built largely around ideas which he had long championed in Detroit,
as well as in Washington. Moreover, he sensed intuitively that he and
Roosevelt held a similar view as to the causes of the depression. This
was that the depression was in reality a moral, rather than economic,
breakdown, that ethical conduct by the business leaders would have
prevented the crash.
Neither Roosevelt nor Couzens was much of an economist. But
both thought they knew what was “wrong” and “right” in the dis-


THE END OF AN ERA
200
tribution of the good things of the world and they were for wider
distribution. 4 Both would be assailed as socialists, or some other breed
of anti-capitalist. But this was nonsense for political effect. If
anything, both Couzens and Roosevelt were pure capitalists, con
cerned with preserving the individual-enterprise system. In the thesis
of Louis M. Hacker, 5 Couzens was the “industrial” capitalist, who
viewed the “finance” capitalist, moving toward monopoly, as an
enemy bent upon destroying the very system by which he had built
his own fortune. Roosevelt, in the last analysis, was on his side, he
believed.
2
So, for this campaign, a Republican who could not go along with
Hoover, Couzens kept silent. When Roosevelt won, he was pleased.
He was not even sorry that Michigan, rock-ribbed Republican since
the days of “Zach” Chandler, had gone completely Democratic, elect
ing for governor William A. Comstock, the Democratic chairman
who had called him “really a Democrat.”
Among the Old Guard Republicans, Jim Watson went down, as
did David A. Reed of Pennsylvania, one of those who had infuriated
Couzens by praising dictatorships. So did George Moses, “the master
parliamentarian” and coiner of the phrase, “Sons of the Wild Jack
ass.” Like Watson, Moses had felt more than once the lash of Couzens'
temper, notably after he had accused him of “personal animus” when
Couzens had introduced the resolution for Mellon's resignation in
1928. 6
It amused Couzens to recall that Moses had apologized for this re
mark after Couzens told him that unless he did, he would hear a
speech on the Senate floor about certain aspects of his political career
that Moses would prefer, he said, not to have mentioned. 7
In 1926, Smoot of Utah had insisted that Couzens be removed from
the Senate Finance Committee. Smoot had taken this drastic step
because Couzens so frequently objected to his high tariff proposals. 8
A famous feud had gone on between them ever since. “I'd like to
drive a golf ball through your head!” Couzens once had snapped at
him. 9 Now Smoot was also gone.
“The election pleased me from a national point of view,” Couzens
wrote to Madeleine. “The most joy I had, of course, was the defeat
of Moses, Smoot and Watson—a mean streak in me, no doubt.” 10
But his “joy,” if that were the correct word, was to be short-lived.


210
THE SENATOR
For the 1932 election marked more than the end of the Hoover ad
ministration. It also marked the end of a whole era of American
political and economic policy, and such turning points are usually
accompanied by considerable agony for the leading actors in the
drama. This, as he soon was to discover, would be true for Couzens,
as well as for numerous other Americans.


BOOK FOUR
The Independent Man



813
CHAPTER XXXIII
THE BANK CRISIS
Roosevelt was not to take office until the following March 4, 1933,
and Couzens like nearly everyone else believed the period between
the election and inauguration would be a quiet time. But this cal
culation was rudely upset. New tremors in the banking system of the
country occurred in Nevada, Maryland, Ohio, Pennsylvania, and
Louisiana.
Then, on February 14, 1933, less than three weeks before the new
administration was to take over, there occurred in Michigan the worst
jolt of all: At the request of the bankers, Governor Comstock
ordered all the financial institutions of the state closed for a “mora
torium,” or “banking holiday,” because of an acute emergency in
volving the leading banks of Detroit.
In the words of Charles A. and Mary Beard, “The news from Mich
igan jangled the American System from center to periphery.” If any
thing, this judgment was understatement. For the Detroit bank crisis
proved the time bomb that temporarily toppled the whole American
banking structure, bringing the closing of all the financial institu
tions in the land. 1 Possibly, in view of general economic conditions,
the national banking system might have gone down regardless of the
Detroit situation. Perhaps there were no resources, not even in the
federal treasury, adequate to have averted the collapse, once the situa
tion had gotten out of hand. But in the event, it was the Detroit
crisis that touched off the national crisis.
2
Couzens played a certain role in the Detroit bank crisis, though
it was not the role that many accounts of the situation assigned to
him. 2 Indeed, he really had less to do with it than almost any of the


214
THE INDEPENDENT MAN
other actors. Yet the Detroit situation resulted for him in the most
violent controversy of his whole controversial career. He was blamed
for having closed the Detroit, and hence the Michigan, banks. Yet
his real involvement was in efforts to keep them open, and also, a
little later, to reveal why they were closed in the first place. As will
be seen, more than anyone else, his old partner, Henry Ford, touched
off the explosion, although the conditions in the banks themselves
were not of Henry Ford’s doing.
In the larger sense, the Detroit banks crashed because they had
epitomized the whole fantastic financial pattern of the era. As a Senate
investigation demonstrated, one well summarized, it may be men
tioned, by Federal Judge Ferdinand Pecora in his book Wall Street
Under Oath, no weird financial practice of the period was omitted—
from “window-dressing,” pyramiding of resources for speculation
and the voting of unearned dividends, to the use of bank funds for
improper loans to officers and even minor employees. 3
3
John T. Flynn, then a New Republic contributing editor, de
scribed the Michigan situation better than anyone else in an article
in Harper's for December, 1933, under the title “Michigan Magic”:
These Michigan magicians had invented something brand new
in the way of banking. It was not so completely new, of course, as
they supposed, for group banking has broken out in this country
at intervals, and almost always with disastrous results. But this
was group banking with more virulent tumescence and higher tem
perature and some new complications. It was a combination of unit
banking and branch banking, security manufacture, real estate
exploitation, and numerous other lines, including running a garage,
and all brought together under the control of a holding company
like a utility web or department store chain. There were, of course,
holding companies running wild among banks in other places. But
in Michigan two groups—two holding companies—set out to capture
the entire banking resources of a whole state. . . .
In other cities one bank might fail and the others, somewhat
strained, might continue. But in Detroit, failure of one meant the
failure of all. And they did fail. Not just two banks, but 178 banks
closed their doors. A great industrial city and a rich industrial and
agricultural state were left for months almost without money. It
was the most comprehensive bank failure in our history, and it
marked the crash of the kind of banking which these magicians
gave Michigan.


THE BANK CRISIS
215
4
But it is necessary to get a good deal of background:
The two banking groups were the Guardian Detroit Union Group,
Inc., and the Detroit Bankers Group, Inc. The former was known,
if not wholly accurately, as “the Ford group.” Prominent in its affairs
were Edsel B. Ford and his wife’s brother-in-law, Ernest Kanzler,
who also headed the then Ford-controlled Universal Credit Corpora
tion. In fact, the Universal Credit Corporation was organized as a
joint enterprise of the Ford Company and of the Guardian Detroit
Group. 4
Ironically, among the units of this group, as a consequence of a
series of consolidations, were the two banks that Couzens himself had
founded, the Highland Park State Bank and the Bank of Detroit, by
then merged into a giant called the Guardian Union National Bank
of Commerce. 5 Indeed, because of stock in those old banks that his
father had given to him, Frank Couzens was a director of the
Guardian Group, although he resigned in 1931, “not liking the looks
of things.” 6
The second group was composed of most of the old-line bankers
of Detroit and included in its units the city’s biggest bank, the First
National-Detroit. Its nominal head—“nominal” should be stressed
—was aging E. D. Stair, then publisher of the Detroit Free Press.
It was in the so-called Ford group that the trouble first developed
—specifically in the Union Guardian Trust Company. This was a
successor to the Union Trust Company, which had barely escaped
the panic of 1907, and which since 1927 was housed, apparently quite
solidly, in a $12,000,000 elaborately ornamented skyscraper sur
mounted by a tower—of gilded bricks. Charles B. Warren, whom
Couzens had helped to keep out of Coolidge’s cabinet as Attorney
General, shared in the planning of this strikingly garish “Aztec
temple of finance,” as it has been called.
As a matter of fact, Warren was generally credited with having
also been the originator of the legal basis of the Michigan banking-
group idea as a whole.
This trust company, as the former Union Trust Company, had
been having trouble since 1926, mainly because of overactivity in
real estate loans 7 —trouble that was a prime reason for the merger
of the Union Trust, first with the National Bank of Commerce, and


2i6
THE INDEPENDENT MAN
then with the Guardian Trust Company, to form the Union Guardian
Trust Company.
By December 1931, if not before, the trust company’s condition
was such as to make necessary an emergency loan of $15,000,000
from the Bankers Trust Company of New York and the Continental
Illinois Bank of Chicago. Before making this loan, these banks ob
tained personal endorsements, and the pledging of securities, from
both Charles S. Mott, another leader in the group and a General
Motors Corporation executive, and Edsel Ford.
By January 1, 1932, the Guardian Group owed to Edsel Ford, per
sonally, a total of $8,500,000 in advances and endorsements. 5 * * 8
At the end of that year the Ford Company itself went to the aid
of the trust company, advancing it $3,500,000, under an agreement
which made the company, for all practical purposes, a Ford Company
subsidiary. For it could then transact no major business without
Ford Company approval. 9 Later it was revealed that, at this time,
the trust company could not meet even routine cash withdrawals,
except for overdrafts honored by the Guardian National Bank of
Commerce, its own affiliate, and its possession of the welfare funds of
the City of Detroit on deposit with it. 10
5
When the Reconstruction Finance Corporation was established,
the Union Guardian Trust Company applied for a loan almost in
stantly. By putting up its best collateral the company borrowed, on
May 24, 1932, $4,250,000 from the RFC. In July 1932 it obtained
an additional $8,733,000 from it.
Yet even then, the company “was in imminent danger of suspen
sion,” its officers advised the RFC, unless the RFC were willing to
loan an additional $i5,ooo,ooo. 11
A stumbling block was the requirement in the original RFC law
—later amended—that loans could be made only on the basis of
sound collateral, a legal provision important to bear in mind. Also,
the RFC board of directors at this time took the position that enough
assistance had been supplied by the government. The Fords, they
said, should make up the difference, in view of their involvement. 12
It was after this that Henry Ford approved the $3,500,000 loan
from the Ford Motor Company.


THE BANK CRISIS
217
6
But this Ford Company loan was only additional and inadequate
shoring, for the trust company still tottered. “Disclosures of the true
facts to the public on December 31, 1932 probably would have re
sulted in its immediate suspension/' one analysis summed up its
condition. 13
In cold figures, the trust company then (its trust accounts aside)
had no more than $6,000,000 in convertible assets, as values then
stood, against deposit liabilities and borrowings of approximately
$20,000,000, a shortage of at least $14,000,000. 14
A plan was discussed for saving the situation—to take the trust
company entirely out of banking and investment activity, which had
caused its trouble, transfer its deposit liabilities to the Guardian
National Bank of Commerce, and keep its trust business only. 15 But
to do this meant covering, somehow, the $14,000,000 deficit.
There was the rub—and the nub—of the Detroit crisis, in its first
stage.
7
Certain leaders of the Guardian Group gathered at Kanzler's offices
in the Universal Credit Corporation, for a private conference, on
Sunday, January 15, 1933. To this meeting had been invited A. P.
Leyburn, the chief national bank examiner, with headquarters in
Chicago. Only a few weeks before, Leyburn had appeared before
the board of the Guardian National Bank of Commerce to warn that
this bank was in bad shape. 16 Now Leyburn heard Kanzler say:
“The trust company cannot hold up much longer. We have to get
considerably more money or the whole group is going to collapse!” 17
As later it became plain, the purpose of the meeting was to get
Leyburn’s cooperation to persuade the RFC to change its attitude
toward the trust company. A new approach had been determined
upon. Instead of going to the RFC for additional loans to the trust
company alone, an application on behalf of the entire group would
be filed. On being consulted, Edsel Ford approved. As he later said,
“The whole matter was gone over with me by Mr. Kanzler. . . .
I concurred . . . and steps were taken to proceed.” 18
At this meeting Kanzler informed Leyburn that Edsel Ford had
told him that the Ford Motor Company would agree to subordinate
its deposits of $7,500,000 in the trust company. At least, this was


2i8
THE INDEPENDENT MAN
Kanzler’s understanding. In that event, the deficit in the trust com
pany could be considered as being no more than $6,500,000. Edsel
Ford later corroborated Kanzler’s statement concerning the pos
sibility of the Ford Company’s freezing its deposits. ‘‘It was under
stood that the subordination would take place,” he said. 19
Leyburn fell in with the plan, but suggested refining it. Congress,
only a short time before, had passed a little-publicized amendment
to the RFC law which permitted loans to be made to banks through
special corporations set up to receive such loans. On the basis of this,
Leyburn suggested that the Guardian Group form such a corporation
and apply for an RFC loan in its name. The suggestion was adopted,
the Wolverine Mortgage Corporation was formed.
To the Wolverine Corporation, the group then did transfer nu
merous assets, totaling, in face value, $88,ooo,ooo. 20 With these as
security, Kanzler went to Washington with Leyburn and presented
to the RFC on January 26, 1933, a request for a loan of $65,000,000
(counting the earlier advances by the RFC to the trust company).
In the meantime, affairs at the trust company were going from bad
to worse. Nor was this merely in the natural course of events. As
would be said in court, “Throughout the month of January 1933,
the Group continued to withdraw as much as possible from the Trust
Company.” 21
8
The RFC began immediately to process the $65,000,000 applica
tion. Its chief appraiser, John K. McKee (afterwards a member of the
Federal Reserve Board) was sent to Detroit to check the Wolverine
collateral.
“The various officers of the banks came in with their collateral in
pouches, and we attempted, working day and night there, to prepare
a schedule,” McKee recalled. 22 But he was not happy over what he
discovered.
To the RFC, on February 6, McKee reported that the $88,000,000
Wolverine assets were worth, for loan purposes, only $37,720,000,
including the assets on which the RFC had made its earlier loans.
But Kanzler pleaded for special treatment.
Mr. Kanzler admitted [the minutes of the meeting of the RFC
for February 6 read] that there was a considerable gap between the
value of the collateral which could be pledged, and the amount of
the loan desired, but said that the Guardian Group situation in-


THE BANK CRISIS
219
volved the imminent danger of financial disaster of major propor
tions affecting the State of Michigan and the country at large, and
that he and his associates, feeling that if possible something should
be done to avert this, had decided to lay the circumstances before
the directors of this corporation. 23
The board members of the RFC shook their heads. A new admin
istration was coming in. There had been widespread criticism of the
Dawes bank loan. Moreover, earlier loans to the trust company had
received unsavory publicity, John T. Flynn having written them
up, with the implication that Roy D. Chapin, of the Hudson Motor
Company, by then Secretary of Commerce in Hoover’s cabinet (and
another of the founders of the Guardian Group) had used his “in
fluence” with RFC. 24
Besides, the Detroiters were asking something that was clearly
illegal. To accede would mean leaving the RFC board members
personally liable for any loss.
The RFC board refused to take such a risk.
As a solution, the board pointed to the Fords.
In view of the previous help by Edsel Ford and the Ford Motor
Company, the Fords actually were the leading creditors of the trust
company. If the RFC did grant a new loan, even if it were legal, in
effect this would have meant transferring the load from the Fords
to the federal government. Concerning the RFC board members’
views, Leyburn later recalled:
They figured there was not enough security there. And they asked
all the time, “Well, what will Mr. Ford do?” . . .
Their idea was all the way through, or their thought was—and
they did not hesitate to say so—“Why should we bail out Mr. Ford?”
They figured that he should come to the rescue up there. 25
Kanzler reminded them of the understanding that the Fords would
freeze their $7,500,000 in the trust company. But he was dubious
about the Fords doing more. To get them to put up an additional $6,
500,000 was probably out of the question, he said. 28
In the meantime, McKee telegraphed to Detroit to see if his RFC
assistants there could not dig up more assets. Kanzler finally agreed
that the application should be scaled down from $65,000,000 to $50,
000,000.
“We revamped the application,” McKee later said, “but there was
still a hole.” He added, “We had just gone the limit.” 27
The “hole” in the trust company amounted to $6,000,000—pro-


220
THE INDEPENDENT MAN
vided the Ford Company stood by Edsel Ford's commitment of sub
ordinating its deposits. Otherwise, it would be larger.
Not emphasized at the time, but highly significant later in con
nection with Couzens, was one objection to the Wolverine Corpora
tion plan in addition to its legal and political aspects. This was a
moral objection. For the plan, in essence, called for using sound
assets of all the units of the Guardian Group—banks outside as well
as in Detroit—to bolster the shaky trust company. In short, innocent
depositors in other banks were to have their funds jeopardized for
the sake of the trust company, albeit the authors of the plan justified
this, perhaps properly so, with the argument that failure of the trust
company would also bring down the other banks.
In the event, the RFC flatly turned down the Wolverine scheme. 28
This should be noted in connection with allegations, repeated as
late as 1952 by Herbert Hoover and reiterated still later by others,
that it was Couzens who stopped the loan. 29 By design of the inter
ested parties, as will be seen, he was not yet even in the picture.


221
CHAPTER XXXIV
THE WHITE HOUSE CONFERENCE
Two days later, February 8, 1933, Edsel Ford conferred in Washing
ton on the situation with Ogden L. Mills, who had succeeded Mellon
as Secretary of the Treasury. He also talked with Charles A. Miller
of Utica, New York, who had succeeded Dawes as president of the
RFC. Miller left a record of his conference with Edsel. “I . . .
urged on him strongly the duty of himself and his father to come to
the rescue of the situation [recalled Miller]. I gathered from him
that he was entirely willing to do this, but that his father had other
views and that influences other than his would have to be used to
get his father to change his mind.” 1
There is no doubt that Edsel Ford was trying to be as helpful as
possible, that he wished to avoid a disaster and wanted the Ford Com
pany to help save the situation. But there also seems no doubt that
he was meeting resistance from his father. As would be said by Roger
Burlingame, Edsel’s “life had always been more or less frustrated” 2
—mainly by Henry Ford, common knowledge in Detroit that Charles
E. Sorensen amply confirmed in his memoirs published in 1956.
Edsel’s remark about “influences other than his” suggested an
idea to Miller. Why should not President Hoover personally request
of Henry Ford himself that he save the situation? Miller’s thought
was that if the President invited Ford to the White House, Ford
would not, could not, refuse. 3 Miller immediately called on Hoover
and made that suggestion.
But Hoover, according to Miller, was reluctant to act on the pro
posal. “The President told me,” Miller wrote, “that he was ab
solutely without influence so far as Mr. Ford was concerned, and to
show that, he stated he had endeavored to obtain a contribution
from Mr. Ford to the Republican campaign expense account, and
had either been turned down entirely or had been offered some trivial


THE INDEPENDENT MAN
222
amount, I've forgotten what, but I think about $500. Under these
circumstances, he said he was entirely unwilling to ask any assistance
in this matter from Mr. Ford.” 3 4
2
This was a strange attitude for Hoover to take, especially as Ford
had spoken on the radio in behalf of his re-election, and in Ford
Company plants all over America a pre-election notice had been
posted, on October 17, which said:
The Ford Motor Company is not interested in partisan politics.
We do not seek to control any man's vote. [However] we are con
vinced that any break in [President Hoover's] program would hurt
industry and employment. To prevent things from getting worse,
and to help them to get better, President Hoover must be elected. 5
Yet, apparently Hoover still did not feel he could appeal to Ford
personally at this crucial time.
Of course, Hoover did honestly wish to save the situation. So in
lieu of adopting Miller's suggestion, he decided to call a meeting at
the White House for the evening of February gth. To this conference
he invited Secretary Mills, Miller, and Michigan's two senators—
Couzens and Vandenberg.
It was this meeting that first brought Couzens directly into the
picture.
3
Couzens had no idea as to the full nature of the Detroit banking
situation until just two days before this White House conference.
This had been because the representatives of the Guardian Group
specifically had asked RFC officials not to let Couzens know of their
application. Their later explanation was that they feared he would
have “lectured them” on banking ethics. 6 Doubtless he would have.
However, on February 7th, Jesse Jones and Harvey Couch, RFC
directors, decided to tell Couzens. They did so, and also told him
that there was no legal way for the RFC to accommodate the Guard
ian Group in the amount it had requested. 7
Then, just before Senator Vandenberg advised Couzens that
Hoover wanted both Michigan senators at the White House on the
Detroit matter, Clifford Longley, a Ford attorney, and by then pres
ident of the Union Guardian Trust Company, and Colonel James
Walsh, executive vice-president of the Guardian Group, called


THE WHITE HOUSE CONFERENCE
223
Couzens to the anteroom of the Senate chambers, and gave
him the details. At this same time they also requested his “support.”
(It was later testified that someone connected with the RFC had
told them: “We want you to get Senator Couzens to recommend
this loan to us.”) 4 * * * 8
Just then Couzens was a great deal more interested in some legis
lation he was sponsoring on the floor of the Senate than he was in
any RFC matter. In the last weeks of the Hoover administration,
his pet interest was to solve the problem of jobless, homeless boys
and girls who, by the thousands, were roaming the highways of
the nation in search of food and shelter. His solution, forerunner of
the Citizens Civilian Conservation Corps (CCC camps of the Roose
velt administration), was to open Army forts in various parts of the
country to homeless youths, who would work there on various
projects, such as reforestation and flood control, for their board
and shelter. 9
The Senate was debating his proposal when a page boy advised
him that two gentlemen from Detroit, Longley and Walsh, were
waiting for him in the Senate anteroom. He went out to see them
at once.
4
He did not give Longley and Walsh much of his time. When they
began on the details of their application, he stopped them short.
He knew all about the matter already, he said. 10 He commented
acidly on the assets in the “Wolverine Corporation,” asking pointedly
if they included notes of a certain Detroiter, who, he said, he hap
pened to know had been loaned a large sum and was notoriously
unable to pay. The bankers ruefully admitted that these notes were
included. 11
There was some talk about the general problem of making RFC
loans to banks. Finally he commented that as a matter of basic
philosophy he was not at all certain that the RFC ought to save the
banks. After the Dawes bank episode in Chicago, he had begun to
have doubts about the soundness of the whole idea of the RFC, he
said. In this, incidentally, he was not alone. Financiers as dis
tinguished as Secretary of the Treasury Mills, Winthrop Aldrich of
the Chase National Bank, and Melvin A. Traylor, president of
Chicago’s First National Bank, had voiced similar doubts as to
whether unsound banks should be saved through government sup-


224
THE INDEPENDENT MAN
port. 12 Testimony about this interview was given later by Longley,
in direct examination by Couzens himself.
longley: You said you were in a quandary as to whether you should
go one way in support of these institutions, or let things
slide the other way and let them go. I have forgotten what
your language was.
couzens: I guess it was printable, was it not?
longley: Oh yes, quite printable.
Longley and Walsh departed from the Senate feeling indignant.
5
Actually, this interview changed nothing. The decision was still
up to the RFC, exclusively. No one as yet had devised any plan
for meeting the objection that the Guardian collateral was not suf
ficient to permit a legal loan of more than $37,720,000, the McKee
figure. This, as stated, was the nub.
That night Couzens went to the White House under a serious
misapprehension as to the purpose Hoover had in mind. He be
lieved that the conference was called to get approval of an illegal
loan. If that were the case, he knew what he would do. He would
voice opposition. He made this clear in a conversation with John
Carson, his secretary, who drove him to the White House.
Going to the White House that night [Carson recalled] I urged
Couzens to take one position which might have been a cowardly
one. I argued that the RFC had authority to make the loan, that
he, as a senator, had no authority whatsoever in the matter, that if
the RFC made the loan the RFC would divulge its action or keep
it secret, that it was obvious the bankers and Hoover did not want
to consult him until they felt compelled to do so, that therefore
he would be justified in listening to the story and then saying that
they had authority and responsibility and the facts and they should
exercise their responsibility. His answer was that there was a critical
situation and “you cannot run out on such situations.” 13
Actually, the White House conference was held, not for the pur
pose of putting through an RFC loan, certainly not in the case of
the trust company, but to find a substitute for an RFC loan. As
stated by Miller, later:
Unless the directors of the RFC desired to take a really criminal
responsibility, we could not have made the loan; and after we knew
the facts and figures, none of us, I think, were in favor of making it,
especially when Edsel Ford and the Ford Motor Company repre-


THE WHITE HOUSE CONFERENCE
225
sented the large block of stock and held deposits there of an even
larger amount.
The conference at the White House, therefore, was not held to
discuss the possibility of the RFC making the loan as asked for,
but was rather to find some feasible plan for coming to the assistance
of this banking situation without violating our legal duty. 14
President Hoover also made this clear—in 1933—in a communica
tion to the later grand jury investigation of the crisis, saying:
I was informed that the Guardian Trust Co. situation was such
that, even with-the utmost of government assistance possible under
the law, it would be insufficient without outside help and reorganiza
tion internally. The request . . . was that I should endeavor to
bring about cooperation from outside banks, private interests and
leading depositors to reorganize the trust company and thus prevent
a crisis. . . . 15
£
The fateful conference was held in the Lincoln Room of the
White House.
Unfortunately, it was opened by Miller in a way that contributed
to Couzens’ continued confusion as to its objective, as the RFC
president realized later. For, instead of making clear at the outset,
in his review of the situation, that the RFC could not make the re
quested loan, and had no intention of making it, Miller began the
meeting by reading the original application for the $65,000,000 loan.
This convinced Couzens that the conferees were to be asked to
give their approval to that application. His emotions began work
ing when he heard Miller give his personal reasons why he, as RFC
president, had rejected the loan—that the loan would be illegal
and also immoral.
“Possibly I even overemphasized these reasons,” Miller later re
called, “because my Washington experience had led me to expect
that Senators and Representatives from a state where a loan was
asked of the RFC were inclined to be very critical of any hesitation
on our part to grant exactly the relief asked for, and were generally
either ignorant or indifferent to the limitation of our powers under
the act creating the RFC.” 16
If the RFC president expected the Michigan senators to act in
accord with his “Washington experience”—that is, to insist that the
loan be made—he got a surprise. “Senator Vandenberg made almost
no comment on this occasion,” wrote Miller. 17 As for Couzens,


226
THE INDEPENDENT MAN
Milter’s use of the word “immoral” produced a predictable ex
plosion.
If any such loan were made, he would “shout against it from
the rooftops and on the floor of the Senate!” he said, a remark
which, when lifted out of full context, was to get him into much
trouble and also lead to much misrepresentation, unintentional or
otherwise. 18
7
But nobody else at the conference expressed any different views.
Certainly no one expressed any disagreement with Couzens on his
assertion.
President Hoover did not. It would have been strange if he had,
inasmuch as in a speech in St. Louis, on the preceding November
4, he had gone out of his way to emphasize (concerning RFC loans)
that “the law requires that they should be made on adequate se
curity.” 19
In the words of Senator Vandenberg, all that Couzens had done
was to be “particularly aggressive” in voicing his opinion. 20 It turned
out later, however, that it would have been much better for Couzens
had he not been so emphatic, for his explosion would be remem
bered and used against him.
After everyone had agreed that the RFC was estopped from help
ing the trust company, Hoover directed the conversation toward
the real purpose of the conference. This, it turned out, was to induce
Couzens personally to put up funds to help save the trust company.
As Hoover sketched the situation, the status quo in Detroit could
be preserved if about $6,000,000 were raised privately. Hoover
began this approach by saying that he had discussed the crisis with
Alfred P. Sloan of General Motors and with Walter Chrysler, and
that they had agreed to help, presumably assenting to advance
$2,000,000 each. It should be noted that he did not then mention
Ford. Hoover then asked Couzens if he would contribute $2,ooo,ooo. 21
Still in an excited frame of mind, Couzens obviously was in no
mood to have such a proposal made to him, especially not by Hoover.
Also he resented hearing Hoover suggest to him his “duty” as a
Detroiter. His reaction was told by Hoover: “He stormed that it
was Ford’s business.” 22
Hoover recalled:


THE WHITE HOUSE CONFERENCE
227
I pointed out that Ford had previously put up $5,000,000 against
assets of little value to help and was now proposing to take a further
loss of $7,500,000.
The Senator showed great resentment to my pressing him, and I
replied that if 5% of my fortune would save a panic in hundreds
of banks with hundreds of thousands of small depositors and tens
of thousands of people's jobs in my home town, they could have it
tomorrow. He left in great heat. 23
8
After Vandenberg, as well as Couzens, had departed from the
White House conference, the decision was reached that someone
ask Ford to put up additional cash. It was taken for granted, ap
parently, that the Ford Company would subordinate its deposits.
Inasmuch as Hoover still elected not to talk with Ford personally,
the discussion then came down to who would go to Detroit to get
further Ford help. In view of Ford’s personality, to select the right
emissaries was all-important.
Here, if ever, was a case where the “personal equation” in a
public matter needed to be reckoned with. If not Hoover, then
Ogden L. Mills might have been a good choice. Ford might have
been impressed by having the Secretary of the Treasury come to
see him. But instead of Mills, Hoover suggested that Miller, hardly
known outside of New York State, take the assignment. Miller
begged off. He felt that he was needed in Washington to watch
national developments. Besides, his wife was acutely ill. 24 So the
suggestion was made that Secretary of Commerce Chapin and
Arthur A. Ballantine, a Wall Street lawyer then serving as Under
secretary of the Treasury, go to Detroit on the errand.
This was to be the climax—and a worse-selected cast of characters
could not have been imagined, if the play were to end happily.


CHAPTER XXXV
THE CLIMAX
Chapin and Ballantine arrived in Detroit on Saturday, February 11,
1 933- 1 The date is important, for the next day, Sunday, February
12, was Lincoln’s Birthday, making the following Monday a legal
holiday; hence the banks would not be required to open. This meant
that there was time until the following Tuesday morning, the four
teenth—an extra day—to make arrangements without the possibility
of news of trouble in the trust company causing panic.
The interview with Ford was arranged for at Ford’s estate at Dear
born. “Everything depended ... on the result of the Ford inter
view,” 2 recalled President Miller.
Chapin and Ballantine kept their appointment promptly, but
Ford allowed them to wait for more than an hour. He was out in
specting his fields, they were told.
This was not a good omen as to Ford’s mood. Chapin and Ballan
tine were worried anyway by reports in Detroit that Henry Ford
might not even permit Edsel to go through with his pledge of sub
ordinating the Ford deposits in the trust company, that Ford was
displeased with the whole picture and angry with Edsel and also
Kanzler, whom he blamed for Edsel’s involvement.
“Word came to us,” Ballantine later testified, “that Mr. Ford did
not want to make that subordination.” 3 When Ford finally ap
peared, he made it immediately plain that new trouble was definitely
ahead.
2
Indeed, the Chapin-Ballantine mission turned out to be worse
than a failure; it was a disaster.
When Ford was asked to put up more money, he not only angrily
828


THE CLIMAX
2*9
refused this, but also then and there overruled the commitment that
Edsel had made for subordinating the $7,500,000. He would not per
mit it, he said.
Ford delivered a ‘Very vigorous diatribe against banks and bankers
generally, and against the RFC in particular.” He insisted that the
RFC make a loan large enough to permit the trust company to pay
off all deposits, including those of the Ford Motor Company. 4
Ford said he was not impressed by the explanation that the RFC
could not legally make such a loan. The RFC was organized to keep
banks from closing. Therefore, it should save the Guardian institu
tions. His attitude was summed up later by one official biographer:
“What was the RFC for, anyway, if not to assist in the stabilization
of the banks?” 5
3
Chapin and Ballantine attempted valiantly to get Ford to change
his mind. They spoke of the possible consequences if the trust com
pany failed. They “explained that the situation was so delicate
throughout the whole country that the failure of the trust company,
and with it a number of allied institutions, would almost certainly
bring down the whole banking structure of the country and lead
to distress and hardship, and even very likely to the failure of very
many manufacturing and business institutions as well.”
Ford said:
“Let them fail; let everybody fail! I made my fortune when I had
nothing to start with, by myself and my own ideas. Let other peo
ple do the same thing. If I lose everything in the collapse of our
financial structure, I will start in at the beginning and build it up
again.”
Chapin and Ballantine then appealed to Ford on the basis that
“the country had benefited him and for him now to come to the
assistance of the country and to save it was an opportunity that
had never come to any businessman before.” But this “only ap
peared to antagonize” Ford.
Ford then declared: “If the Reconstruction Finance Corporation
does not make this loan promptly and immediately, I will have
representatives at every Detroit bank the first thing Tuesday morn
ing, when the banks open for business, and will draw my personal
balances and the balances of the Ford Company from them without
any further notice.” 6


230
THE INDEPENDENT MAN
4
This threat by Ford placed a wholly different complexion on the
crisis. In addition to the $7,500,000 in the trust company, the Ford
Company had deposits of nearly $32,000,000 in the Guardian Na
tional Bank of Commerce and more than $20,000,000 in the First
National Bank-Detroit. Neither of those banks could have stood
such a withdrawal. So now the crisis had spread from the trust com
pany to the two leading banks of Detroit, the key institutions of
both groups.
Whether or not Ford actually would have carried out his threat
against all of the banks in Detroit—against the Detroit Bankers
Group as well as the Guardian Group—cannot be known, of course.
During the panic of 1907, it will be recalled, he had told Couzens that
he believed he should withdraw all of his money from the banks
then. Couzens commented years later, in 1927, that he believed
Ford never gave up the idea of trying that. In 1914, Ford had with
drawn his funds from the Highland Park State Bank during the
war panic—the incident that came close to causing Couzens to break
with Ford at that time. In a book published in 1920, there is quoted
this remark, seriously intended or not, by Ford: “I don't have to
worry about banks—they have to worry about me," 5 * 7
5
Worrying about Ford was precisely what banks were doing then.
For in the meantime, an almost continuous meeting of bankers and
other businessmen had been going on in the offices of the Union
Guardian Trust Company. The original purpose was to raise what
money the Fords might not supply. Kanzler had been zealously active
in trying to get pledges. The most he could get totaled only $1,
582,000, which included $619,000 from General Motors and $274,000
from Chrysler. 8 But Kanzler certainly was trying to save the situa
tion in every possible way, once it had gotten out of hand.
It was a curious scene. Nearly all the financial wealth of Detroit
was represented at the gathering. New York and Chicago bankers,
including such important ones as Melvin Traylor, Eugene M. Stevens,
and S. Sloane Colt, also were there. Everyone was aware that the
whole banking structure of Detroit was in danger, and with it, that
of the nation.
As far as they knew then, however, only $6,000,000 was needed.


THE CLIMAX
231
Yet nothing like this amount was forthcoming. “Everyone talked,
yet no one said anything; the meeting was pitiable,” recalled one
who was there. 9
When Chapin and Ballantine appeared at this meeting with the
report of their interview with Ford, the meeting went into a real
panic. The first consequence was that General Motors and Chrysler
bow T ed out altogether from their earlier offer to help. If Ford would
not help, neither would they. 10
How to prevent Ford from carrying out his threat then became
all that occupied the minds of most of the conferees. Only two pro
posals emerged—induce Ford, somehow, to change his stand, or close
the banks to keep him from drawing out his money.
With the latter solution in mind—a holiday such as Huey P. Long
had proclaimed in Louisiana—the governor in Lansing was asked
to hasten to Detroit.
New appeals were made to Ford to change his mind. Ballantine
telephoned to Liebold, Ford's secretary. Liebold answered: Ford
felt as before. 11 Ballantine notified President Hoover, but if Hoover
did anything at precisely this time, the results are not on record.
Wilson Mills, chairman of the board of the First National Bank,
a son-in-law of Pingree, by now really alarmed, tried to reason with
Ford that it would be unfair to punish the First National Bank for a
situation involving only the Guardian Union Trust Company. But
Ford repeated his threat.
Ford stated to me [Mills later related] that unless the Guardian
were permitted to open the following day, he would come down
and take his money, every cent of his funds, from us and from any
other Detroit bank that was open. . . .
I said, “Why is that, Mr. Ford?” He said, “I think it is up to the
government to save these institutions by making them loans. They
saved the Dawes bank.”
I asked him to play ball, told him what the situation was, told
him we were applying for a loan from the RFC . . . and we hoped
to secure one. [But] Mr. Ford made the remark that I have testified
to. 12
6
Then, in Washington, Couzens re-entered the picture, to try his
hand at reversing Ford's attitude.
Contrary to later assertions, his personal relations at this time with
Ford were good. They had long since become reconciled after


232
THE INDEPENDENT MAN
Couzens’ attack on Ford’s Presidential ambitions in 1923. In 1926
they had jointly issued a statement opposing the restitution of the
death penalty for capital crime in Michigan. In 1927 Ford had pre
sented to Couzens, to the accompaniment of a good deal of publicity,
one of the first new-model Ford cars, as a token of “fond remem
brance” of the days when they were associated in the Ford Company.
And Couzens was “thrilled,” he told Ford. 13
Nothing had happened since to mar their truce. Thus, when
Couzens was told of Ford’s ultimatum, he did not hesitate to tele
phone to Ford.
He did so from the office of the RFC, to which he and Vanden-
berg had been summoned by the distressed Miller and Secretary
Mills. Miller recalled:
I was present during this telephone interview, but of course, I
did not hear what Mr. Ford said. I gathered, however, from Senator
Couzens’ talk to him that Mr. Ford claimed that the whole crisis
was brought about by the machinations of his competitors and that
he again expressed his determination to draw all his deposits from
the Detroit banks unless we made arrangements to enable the
Guardian Union Trust Company to pay its depositors by the open
ing hour on the morrow.
I will say, parenthetically, that if there were any errors during all
these negotiations in handling Mr. Ford diplomatically, Senator
Couzens was not responsible for them on this telephone call. He
had apparently been willing almost to tear Mr. Ford limb from
limb when he put in the call, and I have never witnessed so com
plete a change in language and manner as his when the call came
through. During his entire conversation with Mr. Ford, the Senator
dropped sweetness into the phone at every word and never sug
gested even a mild criticism of Mr. Ford’s position. 14
When Ford had thus spoken to him against the RFC and refused
to withdraw his threat against the Detroit banks, Couzens still did
not give up. He determined upon another approach and toward
the end of his talk with Ford he asked him to have Clifford Longley,
Ford’s lawyer, get in touch with him by telephone. “I think we can
arrange this thing for the Union Guardian Trust Company,” he
told Ford. 15 There was no use trying to discuss details with Ford,
Couzens explained later.
7
Couzens was at dinner with Mrs. Couzens when Longley tele
phoned from Detroit shortly after 8 p.m. Of all the numerous tele-


THE CLIMAX
233
phone calls between Detroit and Washington that evening, this
one was easily the most important. It was the one outstanding effort
made by anyone to save the situation in Detroit.
To Longley, Couzens now emphasized what he had tried to get
Ford to realize, that the RFC could not make a loan to the Guardian
Union Trust Company unless more and adequate collateral were
put up, but that it could make a loan if such collateral were made
available. He then asked Longley to get over to Ford a message:
He, Couzens, would go fifty-fifty with Ford in putting up the
collateral that would make possible an RFC loan to the trust com
pany. “I asked him to ask Mr. Ford if he would join me in making
a joint note to guarantee the RFC against any loss.” 16
In effect, that meant that Couzens was willing to risk at least
$6,900,000 of his personal fortune to keep the banks open, if Ford
would do likewise. He was willing, now that he saw the certain re
sult of Ford’s position, to do more than three times what Hoover
had asked him to do the previous Thursday.
Longley called back. He had put Couzens’ offer up to Ford, and
Ford’s answer was “No.” Ford in fact was “annoyed” at the sugges
tion. 17 So there now disappeared the last chance of averting the
bank panic in Detroit, and also of averting the bank holiday.
8
Governor Comstock, by then in Detroit, was not at all anxious
to accept the responsibility of so drastic a step as to order a bank
holiday. He was not certain as to the legality of the move. C. J.
Huddleston, of Lacy, Anderson and Wilcox, among other lawyers,
finally convinced him that he did have the power to keep the banks
closed, although conceding that how to get them open again might
present a different problem. 18
Then there developed some dissension among the bankers as to
whether or not a holiday should be proclaimed. The Guardian bank
ers were all for it, but the Detroit Bankers Group, feeling that their
institutions were not involved except indirectly, tended to oppose
the action, until they discovered that an RFC loan for them could
not possibly be arranged in time.
Later, directors of the First National Bank-Detroit were to dis
cover something just as appalling—that the First National’s condi
tion, with respect to liquidity, was not much better than that of
the Guardian banks. 19


234
THE INDEPENDENT MAN
Comstock finally said that if all the bankers agreed to sign a docu
ment asking him to proclaim the holiday, he probably would agree.
The bankers signed. The federal government representatives, includ
ing Undersecretary Ballantine, also gave their approval. 20 Comstock
still hesitated, but agreed to make up his mind in time to advise the
bankers and the public before the hour of opening the banks on
Tuesday morning. About midnight he left the meeting with Arthur
J. Lacy to get a “breather.”
“It was a cold, misty night. We strolled twice around the two
blocks around the Union Trust Company and the Hammond build
ing,” Lacy later recalled. “We talked the problem over as we walked
and as we dropped into a hot dog stand for a hot dog. Comstock
asked me what I would do in his position. I told him that everybody
at the meeting was agreed that a bank holiday was imperative and
that if we didn’t have one it would cause a nation-wide banking col
lapse.
“So we went back and Governor Comstock told the bankers and
government men that he would call a holiday. . . .” 21
At 1:32 Tuesday morning, February 14, 1933, in the gilded
tower of the Guardian Union Trust Company, Comstock affixed his
signature to a proclamation that closed the banks. 22
At 2:00 a.m., Herbert R. Wilkin (a name to be remembered), one
of many vice-presidents of the Guardian Group, called Ernest
Kanzler on the telephone and gave him a message: “The jig is up!” 23


235
CHAPTER XXXVI
"A HELL OF A MESS”
The holiday served its major purpose of keeping any depositors,
including Ford, from making withdrawals. But getting the banks
open again was another matter.
Originally the holiday was supposed to last only eight days.
Governor Comstock, however, was forced to extend it indefinitely
at the request of the bankers themselves. For the federal bank
officials took the position that the Guardian National Bank of Com
merce as well as the First National Bank-Detroit, the leading Detroit
banks, each head of its group, could not be reopened unless they
were reorganized and more capital put into them. Otherwise, the
banks would simply collapse under new runs that were bound to
develop, they said. Their condition had been perilous, anyway, for
months. In fact, the federal officials said, both banks were actually
insolvent. 1 Chief Bank Examiner Leyburn summed up the situation:
“Gentlemen, we are in a hell of a mess!” 2
With its nationwide repercussions, the “mess” was complicated
by the attitude adopted by nearly everyone concerned. For the efforts
of solving the humpty-dumpty situation that had developed were
carried on against a background of the most bitter kind of recrimina
tion and misrepresentation.
Everybody apparently tried to place the blame on everybody else.
President Hoover and those close to him, blamed, at first, Governor
Comstock. 3 The proclamation of the holiday was unnecessary; Com
stock had yielded to panic, they said. As Theodore G. Joslin, one of
Hoover’s secretaries, even said later:
“I have always felt that the governor lost his head; if he had not
become panicky, that catastrophe would have been averted.” 4


2S 6
THE INDEPENDENT MAN
2
A defense of Hoover in the banking crisis—a book, Prelude to
Panic, by Lawrence Sullivan—contained an amazingly inaccurate
version.
Secretary Mills . . . had been informed that the Detroit bankers,
now in alarmed confusion, had called Governor William A. Com
stock into consultation. A few hours later all the RFC plans were
brought to an end by the sudden determination of the governor to
proclaim a ten-day banking holiday throughout the entire Statel
This proclamation . . . was issued without consultation between
Governor Comstock and the RFC, Treasury, or White House. By
this single stroke all the ground was instantly cut from under the
Washington rescue plans. 5
3
Hoover also blamed Roosevelt. Here the argument was that the
bank crisis would not have occurred had not Roosevelt undermined
“public confidence,” first, by failing to commit himself to Hoover’s
economic policies, and second, by failing to disavow certain advisers
who suggested that it might be a good thing for the country to go
off the gold standard. 6
As for many of the bankers, they at first placed the blame, generally
speaking, on “general conditions,” ignoring evidence that some of
them had been making unwise investments or extending unwise
loans on the basis of unsound security, or that some bankers also had
been motivated by “manipulation, greed, and dishonesty” (Couzens’
words later) as they helped themselves, in the form of loans, to de
positors’ money in their custody. Later many bankers also echoed
Hoover: “Roosevelt was at fault.”
The Reverend Charles E. Coughlin, the “radio priest” of the
Church of the Little Flower at Royal Oak, Michigan, was blamed—
because of speeches he had made attacking the banking system in
general and the Detroit Bankers Group in particular.
The Detroit Times was blamed—because it had been devoting
a good deal of its space to the Coughlin speeches.
The RFC was blamed. Communists were blamed. 7 The Senate
Finance Committee inquiry into Wall Street was blamed. 8
Henry Ford came in at the outset for some slight criticism, for
Governor Comstock issued a statement telling in part, although in
a garbled way, the connection Ford had with the holiday. Later


“a hell of a mess”
237
Governor Comstock issued a repudiation of his revelation about the
Ford role. “I misunderstood the facts,” he said. 9 Even Couzens
elected not to emphasize the part played by Ford in the disaster, not
even in his own defense.
4
But of all the scapegoats, Couzens himself became Number One.
“You do not and cannot realize how unanimous the belief is that
you are to blame for this bank situation!” Thomas A. Payne, an
attorney who had managed Couzens' 1930 re-election campaign, and
one of his most loyal friends, wrote to him. This was all too true.
Instantaneously there grew up a legend:
The Detroit banks could have been saved by an RFC loan, but
“Senator Couzens blocked the loan,” first, because he “hated Henry
Ford,” and, second, “because he hated all rich men in Detroit.”
Unwittingly, perhaps, Hoover was in large part responsible for
starting this legend. In talks by telephone with various Detroiters
at the beginning of the crisis, he had spoken bitterly of Couzens'
“non-cooperation” and mentioned, without proper interpretation,
Couzens' threat of “shouting from the rooftops.” 10 Editor Malcolm
Bingay, who admittedly disliked Couzens, obtained Hoover's version.
On the second day of the holiday, he published in the Free Press
on its front page a story that set the pattern. The headlines were:
FORD-COUZENS CONFLICT
REVEALED AS A FACTOR
IN FINANCIAL STALEMATE
Senator Opposed RFC Loan to
Trust Firm, Saying Collateral
Was Not Sufficient
Insisted That Motor King Keep $7,100,000
on Deposit as “Frozen Asset"; Magnate
Refused to Sign Joint Note
and the article said:
If it had not been for Senator Couzens' protests, the loan would
have been granted.
The RFC officials and other bankers held to the belief that this
loan was necessary. There followed a bitter battle with Senator
Couzens, who held that it was not a safe investment for the Govern
ment. He insisted that there should be more collateral. He was
called to the White House and President Hoover pleaded with


THE INDEPENDENT MAN
238
him. He vowed he would go on the floor of the Senate and de
nounce the loan if it were made. . . . n
5
A more garbled version would be hard to imagine. But Couzens
largely had himself to blame. For one thing, when it had leaked
from the supposedly secret White House conference that he had
made his “rooftops’' threat, he readily confirmed that he had made
the threat, but, like Hoover and Bingay, without making clear the
circumstances. 12
Later in the heat of controversy he voiced sentiments which made
it look as if he himself confirmed Bingay’s version or that he would
have been glad if he had actually blocked the loan. For example:
“I did not stop the much disputed loan. . . . However, I’m glad
to have the public think I stopped it, if the public wants to think
that; because as it was presented to Washington, it was an illegal and
a wicked loan.” 13
Moreover, just before the bank holiday, he had given to Jay Hay
den a long interview on his views concerning RFC loans in general
which made it appear that he was opposed to any kind of assistance
to banks. This interview was unfortunately timed. It appeared in
the Detroit News on Monday, February 13, the day before the
holiday.
Everybody is saying, “Let us ask the RFC for money.” Now that,
to my mind, raises the largest single issue facing the new administra
tion. It is whether we shall open the treasury door to everyone or
close it to everyone.
I supported the RFC in its present form because I believed that,
by aiding the railroads, the banks and other like industries, we
would benefit the great body of bank depositors and borrowers,
insurance policy holders and the like, and then stimulate recovery
generally.
But during the year that has elapsed, I have very carefully watched
the operations of the RFC and the financial developments in the
country and I have about reached the conclusion that the federal
government either has to support the debt structure for all of the
citizens or we have got to stop the rescue of any of them. 14
To a good many people, later, as well as at the time, this article
appeared to represent corroboration of the story in the Free Press
two days later. Besides this, the newspapers then recalled that Couzens
had denounced in the Senate an RFC loan of $12,800,000 to the


*39
“a hell of a mess”
Missouri Pacific Railroad, because, as chairman of the Committee
on Interstate Commerce, he was not satisfied that the way to solve
the railroads’ financial problems was through that procedure. He
had sharply observed that the chief beneficiary would be, not the
railroad, but J. P. Morgan and Company. 15 Also, he had raised ques
tions about the Dawes Chicago bank loan in 1932, although in the
end he approved that transaction when shown facts proving that if
it had not been entered into, probably all of the banks in Chicago
would have been forced to close. These protests, together with his
sponsorship of a special Senate subcommittee to act as watchdog
over all RFC loans, gave him the reputation of being irreconcilably
anti-RFC as well as against helping the Detroit banks, although this
was not at all his true position. 16 Even careful students of the crisis
would be misled by published material about him on this point.
But there was still one more reason why the false version crystal
lized against Couzens. Usually over-quick to defend himself, he now
determined that with the banks closed, it would be unpatriotic for
him to stir up controversy over why the banks were in such a con
dition. To tell the facts, he would have to attack the bankers, and
also to stress the part played by Ford. He decided not to do this.
“Some day the history of all the events and personalities who played
their parts, will be written, but now is not the time,” he said. 17
So, instead of devoting time to hitting back at accusations against
himself, he concentrated on efforts for getting the Michigan banks
reopened. “I am rushed to death with Michigan’s bank troubles, plus
all my own legislative work,” he wrote Madeleine on February 20th.
His efforts, in which he was assisted by Vandenberg, bore fruit
in the one plan that might have permitted the Guardian National
and the First National to reopen. This was a proposal, embodied in
a Joint Resolution, soon known as the “Couzens Resolution,” which
he presented to the Senate on the 20th. It authorized the Comp
troller of the Currency to allow national banks, such as those
in Detroit, to reopen and operate along the lines of a plan that al
ready had been worked out in New York and in Iowa for state banks,
permitting “frozen” banks to start from scratch after segregation
of their non-liquid assets and obligations against them from current
deposits and commitments, if state laws permitted. Disbursements
would be permitted on a limited basis. In effect, this permitted in-


240
THE INDEPENDENT MAN
solvent banks to act as their own receivers, the while avoiding the
stigma and penalties of failure. 18
This resolution was adopted by the Senate in two days. The
House concurred on February 25, and Hoover promptly signed the
resolution. 19 Then, all that was needed to reopen the old banks—if
the bankers so desired—was for the Michigan legislature to pass
complementary legislation. Such legislation was introduced at Lan
sing, at Couzens* suggestion, with Kanzler acting as principal pro
ponent.
7
Meantime the bankers and other businessmen in Detroit were
working in other directions. They considered plan after plan. But
each came to nothing because something that the First National
directors might propose would be vetoed by the Guardian directors,
and vice versa. Or cliques within the groups gave vent to expressions
of rivalry and mistrust. Moreover, there was still reluctance on the
part of the top financiers to put up any money.
The bankers* solution was to have one more merger, to con
solidate the Guardian National and the First National. In this,
they were encouraged by New York bankers and by the RFC itself.
The theory was that if some $11,000,000 of new capital were sub
scribed for a consolidated bank, the RFC would extend a sizable
loan to the new bank for unfreezing the frozen assets of the old banks.
Then the Comptroller would authorize the new bank to take over
the two old ones.
But an immediate hitch developed—again in the attitude of Henry
Ford. As the leading depositor in both banks, his support was essential
regardless of anyone else*s. He was counted on to help supply the
new capital—and Ford kept aloof. 20
8
Indicative of the hysteria was a hastily written letter from Secretary
of Commerce Chapin to Couzens. “I foresee by the first of the week,**
Chapin wrote on February 25th, “the possibility of very serious dis
orders. All sorts of threats are being made by depositors, and what
they want—and that quick—is some form of relief. If it is not
afforded, we shall have a riotous Detroit and a prostrate Michigan
facing us.** 21
Two days later, the newspapers announced that the crisis was


2 41
“A HELL OF A MESS”
solved. Two new banks were to be established, as the bankers had
urged, with Ford cooperation. The difference between this and
earlier solutions was that the new institutions would be all Ford.
The Fords would put up, not some capital, but all of the capital,
$11,000,000, and they would own all of the stock and designate the
directors. The RFC would put up $135,000,000—$100,000,000 on
First National assets and $35,000,000 on Guardian National assets.
There would be an immediate payoff of 50 per cent to depositors.
At first, even by the bankers who were to be displaced, this Ford
plan was greeted with hosannahs. A joint statement by the boards
of directors of the First National and the Guardian National banks
called it “generous and public-spirited.” 9 * * * * * * * * * * * * 22 The application for the
$135,000,000 loan was rushed to the RFC. It was widely believed
that the new banks would be operating in a few days.
Henry Ford gave out jubilant statements. He told newspaper re
porters that he would evolve a new kind of banking system in the
world. “Our policy will be an evolution,” he said. Loans would
be made only for “productive purposes.” As for interest, it would
be reduced or even “eliminated.” 23 In Dearborn, Ford’s town, a
civic demonstration was staged, with three thousand persons parad
ing the main street, bearing a banner that said: “BANK WITH
HANK!” 24
9
In Washington, Couzens was delighted, especially as he had been
on the verge of offering to put up the capital himself for a new bank
in Detroit, in answer to urgent pleas that “something had to be done”
to get some kind of commercial banking going again. He had gone
with Attorney Henry Bodman, prominent in the Detroit banking
picture, to the office of the Comptroller to set his plan in motion.
He was greeted there by Acting Comptroller F. G. Await, who
told him excitedly that the problem was settled. In Couzens’ words
later, “I, immediately, with considerable enthusiasm, said, ‘Well,
that lets me out!’ I was glad to be out.” 25
But, almost immediately, came a great cooling off.
The fact was that almost no one, after reflection, was happy over
the Ford solution, except those Detroiters whose sole interest was to
get the promised 50 per cent payoff as quickly as possible.
The bankers were not happy. They did not look forward to being
squeezed out of the banking business, or converted into operators


THE INDEPENDENT MAN
242
on a new kind of Ford assembly line. They gagged over Ford’s
financial ideas.
Ford’s business competitors were not happy.
A large number of outstate Michigan bankers immediately kicked
up a rumpus. Under the leadership of Joseph H. Brewer, of Grand
Rapids, president of the Michigan Clearinghouse Association, they
began to bombard the RFC, the Comptroller, and all of the Michigan
delegation in Congress, including Couzens, with telegrams opposing
the granting of the $135,000,000 loans to the new Detroit banks. In
the main, this was because of a ruling by the Comptroller that
deposits of the outstate banks in the two Detroit banks, amounting
to some $20,000,000, were not to be given a preferred status. 26
JO
Then Couzens himself set up some opposition. He took the posi
tion that it was against the national interest for the federal govern
ment to commit itself to a loan of $135,000,000 to the banks of one
city, even his own city, when at that time similar crises were develop
ing in other parts of the nation. Banks in Cleveland, Toledo, and
Baltimore had just sent appeals to the RFC for large emergency
loans. When this happened, even the RFC officials began to doubt
whether they should grant the Detroit request. 27 That the federal
treasury had the ability to bail out all banks was considered highly
doubtful.
Couzens still did not at this time oppose all RFC help to the
Detroit banks. A loan should be made, he said, but he suggested
that it be limited to about $50,000,000. This would have enabled
the banks to reopen, but would have reduced the amount of the
initial payoff. 28 Couzens later explained:
I thought it would establish a precedent for every city, county,
and hamlet in the United States to call upon the federal government
for its financial needs. The federal government must stand, regard
less of what happens to states or their political sub-divisions. When
the national credit is gone, there will be chaos, and regardless of
what my constituents may think of my actions concerning their
particular affairs, I am here to use every ounce of energy and effort
to protect the federal government. 29
11
In the end, it was the RFC itself, regardless of Couzens’ position,
which scaled down the Detroit loan. For, in the meantime, RFC


243
"a hell of a mess”
appraisers had been burrowing into the records of both banks, and
now came up with reports that neither bank had assets to justify
the $135,000,000 loan. All that could be granted was $78,000,000.
The RFC proceeded on that basis. 30
Couzens raised no objections to the $78,000,000 figure; it rep
resented, in his view, a reasonable compromise. He did ask that he
be given the right to “represent” the RFC in the ultimate negotia
tions with the Detroiters, but this request was refused.
President Hoover ordered that he be “ignored,” and the $78,000,
000 loan be extended without delay in order to get the new Ford
banks opened. 31 Again it was announced that the crisis was over.
12
Suddenly, all was confusion again. Two things had happened.
The Ford plan, also the RFC commitment, had been predicated
on the willingness of the Central Hanover Bank in New York to
renew loans totaling $20,000,000 made earlier to the First National
Bank. It had been thought that the New York banks would agree,
as a matter of course, to the renewals. Now came the news that legal
objections had been raised by the bank’s lawyers, objections sup
ported by Stanley Reed, then counselor of the RFC, later an Associate
Justice of the Supreme Court. 32 The $20,000,000 renewal was out. 33
Then a revolt against the Ford plan developed in the ranks of
the officers and shareholders of the First National Bank. At 11:45
p.m v Tuesday, February 28, McKee was handed a letter from Mills
of the First National Bank, which read:
At the conclusion of the board meeting today, I was instructed
to telephone Mr. Edsel B. Ford and to state to him that the gen
eral opinion of the board is that it is inadvisable to go ahead under
the proposed plan in which he and his father are interested. I
might add, for your information, that this action of our board
was unanimous. . . .
Faithfully yours,
Wilson W. Mills,
Chairman. 34
As RFC President Miller remarked to Couzens, this was a “peculiar
situation.” For on the same day that James T. MacMillan, a prom
inent director of the First National, telephoned to him to ask that
an additional $20,000,000 be granted to cover the New York bank
item, Wilson Mills, the chairman of the board of the same bank,
telephoned to ask that this $20,000,000 not be granted. 35


244
THE INDEPENDENT MAN
In explanation, Mills later said that while he did not “block the
Ford plan,” he definitely was against it. “The bank was a profitable
business and Ford's plan meant keeping all the profits for Ford, as
Ford would not let anyone else hold any stock. . . . We felt that
the depositors were entitled to [the profits]—not the stockholders
and not any special interests, not Dearborn or New York, or any
body.” 36
What this “peculiar situation” added up to was that the bankers,
in particular those of the First National, had by then decided that
they wanted to operate on the basis of the proposal sponsored in the
Senate by Couzens. As stated by Mills to the RFC on February 28,
“If the $20,000,000 is not forthcoming, the bank will seek to operate
under the Couzens Joint Resolution.” 37
13
Suddenly everyone concerned, in Washington as well as in Detroit,
looked for salvation to the plan that Couzens had embodied in his
resolution. Eugene Meyer, then Governor of the Federal Reserve
Board, had written to Hoover on February 25th:
Recently the Board, after giving the matter careful thought with
these considerations in mind, approved the joint resolution regarding
the powers of the Comptroller of the Currency introduced by Sena
tor Couzens. ... It felt that such a measure would be helpful in
facilitating the working out of existing situations in various com
munities without creating undue disturbance. 38
So, despite all the curses heaped upon him, Couzens now became
the man of the hour. Requests poured in on him that he leave
Washington immediately for Detroit to take the lead in putting the
plan into effect there. Even Ford begged him to come. 39 So did
Stair of the Free Press, who telegraphed: “Your presence in Detroit
and your help on this banking situation greatly needed.” 40 Mills
of the First National twice telephoned him. Senator Vandenberg,
whose responsibility to Michigan was equal to Couzens', but who
cautiously stayed in the background, also urged him to go. Couzens
went.


245
CHAPTER XXXVII
THE MISSION THAT FAILED
His overnight trip might well have been screen-titled: "Couzens to
the Rescue/' Its importance was well underlined in a memorandum
that Vandenberg hastily typed on his portable in his Senate office
and had delivered to Couzens at the Washington railroad station.
"This stupendous journey" was how Vandenberg referred to Couzens'
mission. "We have been in complete and constant touch. You know
my views and I know yours ... I am betting on you!" Vandenberg
wrote. 1
Then, for three days, following his arrival in Detroit on the morn
ing of March 1, Couzens was the leading actor in the drama: "The
Man with the Plan." For once even big business executives acted as
if they esteemed him. His every word and action was reported in
detail and with the greatest respect, even by Bingay. Couzens and
Henry Ford met at Dearborn. With their sons, Frank Couzens and
Edsel Ford, they posed for newspaper photographers. Said the De
troit Times:
The Fords and the Couzens—father and son in two great families
—were evolving a new solution of the banking problem of distressed
Detroit today. Behind oaken doors . . . “Henry" and “Jim" talked
over the most urgent problem of their twin careers, just as in years
gone by they had charted the policies of the Ford Motor Company
during the era of its greatest growth. . . . 2
2
Actually, this was optimistic overstatement. Behind "the oaken
doors," Couzens and Ford had lunch at a table that buzzed with the
conversation of so many Ford executives that there was no chance
to talk seriously about the banking crisis.
Then Ford asked Couzens to visit a laboratory to hear a dance


THE INDEPENDENT MAN
246
orchestra, after which Ford said he had to depart, and did, without
letting Couzens raise the question of the banks at all. 3
But with others, Couzens made better headway, he thought. He
was even praised now for having opposed the $135,000,000 loan
because of national considerations. Wilson Mills, who later lashed
out at him and blamed him for the closings on this very point, was
one who hailed his stand.
First National Bank-Detroit
Detroit, Michigan
March 3, 1933
Dear Senator:
While I saw you only a short time during your visit to Detroit, I
cannot let an hour go by after your departure without writing to
thank you for coming and for what you have done. I think you made
the way seem clear to everyone in Detroit, and I know we are all
doing the right thing.
I also want to state to you here and now that last Saturday I could
not understand your attitude in opposing a large loan by the Re
construction Finance Corporation to the two Detroit banks. Of
course, being so near to the grindstone, I was looking only at
Detroit, and I am bound to say to you that now I think your at
titude was the correct one, that is, the National Government and
its solvency was, is, and must continue to be the primary considera
tion of every one of us.
Again my heartfelt thanks.
Faithfully yours,
Wilson M. Mills
3
In such an atmosphere then, the leaders of the Guardian and the
Detroit Bankers Groups finally agreed upon a simple plan. This was
that the Michigan legislature should be asked to pass at once the
legislation to permit limited operation of the old banks. Under that
plan, the RFC would make loans to the old banks to permit a payoff
of 15 per cent initially, with other payoffs to be made later. Governor
Comstock and leaders of the legislature were consulted. The ma
chinery was set in motion for the legislation to be passed when
Couzens left Detroit on March 3 to be on hand in Washington
for Roosevelt's inauguration.
He was confident that the situation in Detroit was now in hand.
He apparently had succeeded in getting the various banking groups,
shareholders, and depositors, the Fords and other business interests,


THE MISSION THAT FAILED 247
to subordinate their rivalries and thus agree on united action behind
his plan.
Everyone seemed grateful to him. An official statement by the
board of directors of the First National said, “The Senator has been
most helpful.” 4
Best of all, from the standpoint of the bankers, it appeared that
the verdict of insolvency for the Guardian National and the First
National banks would be escaped. There was general confidence
that within a matter of days, the old banks would be reopened. 5
4
Everyone in Detroit, however, had failed to take into consideration
what was happening throughout the nation. In shocking succession,
state after state had gone into banking holidays, until, as of March
3, nearly thirty states were involved. 6
Floover seemed to clutch at straws. On February 17 he appealed
to President-elect Roosevelt for cooperation to bolster public con
fidence. He asked that Roosevelt join with him in a statement to
the public to the effect that under the new President “there will be
no tampering or inflation of the currency; that the budget unques
tionably will be balanced, even if further taxation is necessary; that
the government credit will be maintained by refusal to exhaust it
in the issuance of securities.” 7
Roosevelt’s reply was strangely delayed for twelve days. It was mis
laid by a secretary, Roosevelt later explained. Regardless of that,
the President-elect made it plain that he would not have made the
kind of statement Hoover wished in any event. He considered
Hoover’s request “cheeky.” 8 It certainly was asking Roosevelt to
adopt Hooverian policies. As he explained politely, but firmly, to
Hoover, his thought was that the bank troubles were “so very deep-
seated that the fire is bound to spread in spite of anything that is
done by way of mere statements.” 9
Now, on the eve of disaster, Hoover turned to Roosevelt again.
Through William H. Woodin, Roosevelt’s choice for Secretary
of the Treasury, Hoover asked that the President-elect at least “join
in a statement reiterating confidence in the fundamental sound
ness of American banks and appealing to depositors to stop with
drawing funds.” Roosevelt refused to make this kind of statement
also. He “felt that a strong, positive, definite action should take the
place of appeals.” 10 Hoover then asked if Roosevelt would join


THE INDEPENDENT MAN
248
him in sponsoring a special session of Congress for enactment of
emergency legislation. 11 Again Roosevelt's answer was no. He did
not feel that any action taken by him as “a private citizen" would
be helpful. 12
Hoover next considered two drastic, possible steps. Had he actually
taken either one or both, the final result might not have been
changed, but at least history might have revamped its view of him
as a man incapable of bold action while President. First Hoover
considered asking Congress, on his own initiative, for a government
guarantee of bank deposits, at least temporarily. But before acting,
he asked the Federal Reserve Board if it would support "some form
of Federal guarantee of banking deposits." 13
The Federal Reserve Board declined to support such an idea.
"You are, of course, thoroughly familiar with the history of such
experiments in some of the States and the inherent dangers in a
proposal of this kind," Governor Meyer wrote him on March 2. 14
So Hoover backed away from the proposal, later adopted as part
of the New Deal.
The other step was, by executive action, to close all of the banks
in the country—a national holiday which, at least, would halt
further withdrawals and maintain the status quo. From the first,
Hoover was reluctant to take this action. His view was that "eighty
per cent of the banks measured in deposits were still functioning."
despite the numerous state holidays. But by then, with even the
banks in New York City tottering, the Federal Reserve Board itself
felt that drastic action was necessary. The Board urged Hoover to
proclaim a national holiday. 15
Was such action within the authority of the President? It had
been suggested that the authority could be found in the Trading
with the Enemy Act adopted in 1917 and never directly repealed,
according to some lawyers.
Hoover asked the opinion of his Attorney General, then William
D. Mitchell. Mitchell "advised that these war powers were so doubt
ful that they could be safely used only if it were certain that Congress
would ratify the action." 16
Pondering this equivocal opinion, Hoover again turned to Roose
velt, with the thought that if the new President would approve a
national moratorium, ratification by Congress would be assured.
But through Woodin, Hoover was told that Roosevelt took the
position that "President Hoover was free to proceed as he thought
best." 17 This was not, as has been represented, a refusal to approve


THE MISSION THAT FAILED 249
the moratorium idea. But it certainly was another refusal by Roose
velt to join with Hoover in anything.
5
On the following day, March 3, Roosevelt, with his wife and son
James, called at the White House for the traditional day-before
inauguration courtesy call. After tea, and the usual amenities,
Hoover took the occasion to broach the moratorium idea to Roose
velt personally. Roosevelt said he believed the power was there, but
suggested that if Hoover wanted to close the banks, he should do it,
that “it made no difference who did it.” 18
Aside from the crisis, this tea was not a happy affair, either for
Hoover or Roosevelt. Indeed, according to Roosevelt's secretary,
Grace Tully, Hoover made one remark which caused Roosevelt to
say later, “I hustled my family out of the room. I was sure Jimmy
wanted to punch him in the eye.” 19
Such matters aside, it was plain that Hoover could not bring
himself to act alone on a moratorium, but he was persistent with
regard to Roosevelt. At 11:30 p.m., March 3, he put in a telephone
call to Roosevelt at the Mayflower Hotel. There are conflicting
versions as to precisely what Hoover said to Roosevelt and what
Roosevelt said to Hoover at that eleventh-hour conference. 20 But
the clear facts were that Hoover again asked Roosevelt to join him
in proclaiming a national bank holiday, and that Roosevelt again
insisted on taking no responsibility in the crisis until he had assumed
the power of the Presidency.
The next morning, a matter of hours before the change in
administrations, the final blow fell: In New York, the financial center
of the nation, Governor Herbert Lehman proclaimed a banking
holiday. Almost immediately, Governor Henry Horner of Illinois
followed suit. So did ten other governors. By the time Roosevelt
had taken the oath of office, nearly all of the banks of the nation
were closed under state moratoria of one type or another.
Armed with an opinion by Attorney General Homer S. Cummings
that the Enemy Trading Act was still valid, Roosevelt on Sunday
evening, March 5, proclaimed a national holiday for all banks in
the nation for four days, later extending it indefinitely. Under the
terms of this proclamation, and of an emergency law adopted al
most immediately afterward by Congress, no bank anywhere in the
nation was to be open except under a special license issued by the
Secretary of the Treasury. 21


250
THE INDEPENDENT MAN
6
For Detroit, the result of Roosevelt's action was that even the
Couzens Plan for reopening the Detroit banks had to be abandoned.
The new banking legislation superseded and nullified the authority
granted to the Comptroller under the Couzens Joint Resolution. The
bankers there had delayed too long. The question of whether or not
the Detroit banks were to be reopened at all then became a matter
solely up to the new administration.
On March 12, when Roosevelt delivered the first of his “fireside
chats," he emphasized over and over again that only sound banks
were to receive licenses to reopen. Were the Detroit banks “sound?"
Did “sound" mean “solvent?" These became the crucial questions.
For the emergency, Ballantine and Await had been retained in
office by the new administration. Jesse Jones was slated to become
chairman of the Reconstruction Finance Corporation. And these
were the men upon whom the new Secretary of the Treasury,
Woodin, relied for counsel. Their verdict was that the Detroit banks
were not solvent. 22
Couzens, who was to be denounced and slandered by the bankers
and bank-stock owners, was almost the one official who tried to save
the banks from this verdict.
On March 11, he protested vigorously to Secretary Woodin.
Woodin called in Await and Ballantine and there occurred a heated
scene.
“What is holding up these banks? Why don't you certify to their
opening?" Couzens demanded of Await.
“I will not certify to the secretary that these banks are solvent,"
said Await.
And Ballantine said, “That is true. They cannot open up because
they are insolvent." 23
Couzens demanded proof as to the banks' insolvency. He threatened
to “stay right here until the proof is forthcoming." He did not get
proof, in facts or figures. Unfortunately for the banks, on the other
hand, he was not able to present any facts to controvert the position
of Await and Ballantine.
The Detroit bankers themselves, as he later pointed out, did not
present any facts to offset the verdict of insolvency. Moreover, they
were still entangled in their rivalries. They had been urged by the
Treasury to take the initiative in forming a new bank. But they
could not come to an agreement.


THE MISSION THAT FAILED
251
On March 14 Acting Comptroller Await, backed up by Secretary
Woodin, let the sword fall. He named conservators for both the
First National and the Guardian National. For those banks, as well
as for the two groups of which they were the principal units, the
action was the crack of doom. They were never allowed to reopen.
Scores of investors had fortunes wiped out by this decision. Many of
these then blamed Couzens, hating him fiercely to the end of his
life because of this.
7
Yet, ironically, Couzens to the end had tried hard to avert the
decision of insolvency. He went to Secretary Woodin and upbraided
him in violent terms for having ruled that the banks could not be
reopened.
Secretary Woodin—“Wee Willie Woodin,” the press affectionately
called him—was a likable personality, a big industrialist with a
cherubic face, a financier whose hobby was music, and who had
amazed most of his Wall Street associates by supporting Roosevelt
and contributing heavily to the Democratic campaign funds. 24 But
Couzens, characteristically, had been suspicious of him from the
outset. Indeed, he had made an effort to hold up Woodin’s con
firmation as Secretary of the Treasury until the Senate could be
informed about his “holdings.” As president of the huge American
Car and Foundry Company, Woodin had done much business with
the railroads. On the floor of the Senate, Couzens raised a serious ques
tion. Wasn’t it questionable “ethics” for a cabinet officer to be
holding shares in a car and foundry company “when there is such
close and obvious connection at this time between the railroads and
government?” He wanted to be certain, Couzens said, that Roose
velt’s Treasury head would not turn out to be another Mellon. 25
Of course, with Roosevelt behind him, Woodin was confirmed
promptly. But Couzens was never satisfied. Now he felt that Woodin
was acting in the Detroit crisis in a way not at all in accord with
the public interest, but more as any Wall Street banker would act.
He scathingly reminded Woodin that he had been promised at a
previous conference proof of the banks’ insolvency before a final
decision would be taken. He stormed at Woodin:
You, during this conference, instructed your subordinates to
satisfy me that the Detroit banks were insolvent, but up to this
moment, not one word have I received from you or the Depart
ment. However, within an hour or so after I left, conservators


25*
THE INDEPENDENT MAN
were appointed for both the Detroit banks, and I was not even
done the courtesy of being notified. 26
8
Couzens' protests, and those of the Detroit bankers, were in vain.
Washington stood firm.
Then, and years later, there would be rumors that Wall Street,
or the Federal Reserve Board, acting under the influence of New
York interests, had played a part in this firmness. It would be alleged
this was in accord with a longtime conspiracy to place the Ford
Company under bankers' influence at last, though none of this was
proved.
The fact was, the Treasury decision was not changed.
On March 21, the government itself, through the RFC, together
with General Motors, established a new National Bank of Detroit
to replace the two former institutions. 27
On the following evening, James Watkins, police commissioner
of Detroit, as spokesman for numerous Detroiters, went on the
radio to accuse the government of having “played into the hands of
Wall Streeters." Couzens commented in a letter to Madeleine:
“Police Commissioner Watkins raised Hell in his radio talk last
night. . . . Over 10,000 telegrams reached Washington as a result.
There's the Devil yet to pay over the Detroit bank problem. Wish
I could have remained aloof." 28
To which, it might be added, a better idea he never had . . . too
late.
But the government went ahead. It was understood widely that
Roosevelt himself had insisted that the Detroit crisis be cleanly
and promptly ended. A little later there was established, also by
the RFC, but with the Fords cooperating, the Manufacturers National
Bank. 29 The First National and the Guardian National, with their
holding companies, were gradually liquidated. In the history of
Detroit finance, this was the end of an era. Almost all that remained
of the wonderful group-banking idea in Michigan was the gilded
tower of the ill-fated Union Guardian Trust Company, that mon
ument to a fantastic financial era; and a seething mass of undeserved
hatred toward Couzens, the one man who, though not financially
involved, had tried, with willingness to make great personal sacrifice,
to save the situation. And the story was not yet finished, for after
an interlude, the whole thing was to flare up again.


*53
CHAPTER XXXVIII
THE NEW DEAL ONLOOKER
All during these last bewildering days of the Detroit crisis, other
events, equally tumultuous, had been transpiring in Washington.
These were general developments in consequence of Roosevelt’s in
auguration and his calling of a special session of Congress the next
day. With all his preoccupation with Detroit matters, Couzens tried
his best to keep up with these events also.
He had liked Roosevelt’s inaugural message. The ringing phrases
which gave promise of driving “the money changers from the temple”
and the pledges of direct federal action, if needed, to assist the
“forgotten man” reinforced his earlier favorable impressions of
Roosevelt. He would have agreed wholeheartedly with the comment
of Karl Schriftgiesser: “Franklin Delano Roosevelt thus read the
obituary of Normalcy” 1 of the Harding-Coolidge-Hoover era, against
which Couzens’ whole career in the Senate had been an angry
protest.
The new President’s inaugural speech, he told reporters, was
“grand, grand!”
Indeed, in all his years as a senator, Roosevelt’s message was the
first of any President’s he had felt like cheering.
He was pleased too by a gesture that Roosevelt made to him
personally immediately after the inaugural exercises were closed.
For the new President had sent word that he wished Couzens and
Senator McNary to join him in an intimate gathering in “the
President’s Room” of the Capitol Building. When Couzens came
in, Roosevelt gave him a warm handshake and his famous hand
some smile.
That too was something new for Couzens from a President.
Roosevelt explained that he had sent for him and Senator McNary,
who had stepped into defeated “Jim” Watson’s shoes as Republican


254
THE INDEPENDENT MAN
leader in the Senate, because he desired their cooperation in per
suading the Senate, before adjourning, to confirm immediately cer
tain emergency appointments without reference to committees.
Couzens liked the friendly, non-pompous way in which Roosevelt
made the request to him. “You can take my word for it that these are
good men I” 2
Couzens went away from this, his first meeting with Roosevelt,
with a sense of well-being he had not known for a long time. Roose
velt’s whole manner, his seemingly utter calmness in face of general
confusion, the ready smile, the magnetic personality that caused
his crippled condition to be forgotten, all captivated him as no
other personality in his whole life had done.
One of his senatorial colleagues commented, “Quite a change,
eh?’’
“Yes,” said Couzens. “He’s human!” 3
2
To be sure, Couzens did not surrender to Roosevelt immediately,
or ever, completely.
Being Couzens, his fingers were crossed. The old attitude, which
back in his Ford Motor Company days caused him to be suspicious
of the hale and hearty backslapping salesmen, persisted. Roosevelt
seemed to measure up under his sharpest scrutiny, but he kept some
reservations. 4 He had not forgotten that in 1928, except for his re
tention of Mellon, Hoover also had seemed good to him.
He did not even go along completely with Roosevelt on the re
quest made at that first meeting. For one of his appointments Roose
velt wanted acted upon promptly was that of Woodin, and Couzens’
protests in that connection represented the first opposition that
Roosevelt encountered in Congress. Indeed, it was almost the only
important opposition, save for the attacks on the new banking legis
lation by Senator Huey Long, that came in those very first days of the
New Deal.
Yet, from the outset Couzens was one of Roosevelt’s most fervent
admirers. He even came close to wishing he were a Democrat. Now,
with his rank on committees lowered, he considered that he would
have to be more or less an onlooker on the New Deal that began with
the special session called on March 5. “Most of the work is done
by Democrats now,” he wryly wrote to Madeleine. 5
And to Clarence Wilcox: “We are having hectic days here and


THE NEW DEAL ONLOOKER
255
making history. I have one regret, however, and that is that I am
no part of it, because the Democratic administration is working
perfectly.” 4 * 6
5
True, there were certain aspects of the Roosevelt beginning that
troubled Couzens—the very ones, oddly, which caused so many other
Republicans to cheer the new President. The Woodin appointment
was one matter that caused him to wonder if there was to be a new
deal after all. Another was Roosevelt’s appointment of Dean G.
Acheson as Undersecretary of the Treasury, to succeed Ballantine.
Couzens had checked Acheson’s background and discovered readily
that, like Ballantine, Acheson was a lawyer with Wall Street con
nections. For example, Acheson was a partner of George Rublee, a
close associate of Dwight P. Morrow, partner of J. P. Morgan and
Company. When Morrow ran for Senator in New Jersey in 1931,
one of his ghost writers was none other than Acheson. 7 On May 17,
1933, Couzens rose in the Senate to oppose Acheson’s confirmation.
‘‘I know,” he said, “that Mr. Woodin and Mr. Acheson are going
to be just as much the agents of Morgan as anyone you could put
there. . . . The Treasury now is being manned by men who, I be
lieve, are unable, because of former connections, to serve the public
properly.” What kind of a New Deal is that? he asked. Was the
New Deal intending to foist more Mellonism on the country? 8 *
It was ironic, too, that just a few weeks later Roosevelt agreed
with Couzens that Acheson was too conservative, and rather un
ceremoniously asked for his resignation when Acheson balked at
Roosevelt’s monetary policies. 8 It was more ironic that still later,
this “too conservative” Acheson would be denounced as a “pro
Communist,” after he became Secretary of State under Roosevelt’s
successor, President Harry S. Truman, with his friends recalling
Couzens’ opposition to his confirmation in 1933 as a defense.
4
Even more exasperating to Couzens was the so-called Economy
Bill of 1933, sent to Congress by Roosevelt on March 10, which, in
keeping with his pledges for cutting the costs of government, pro
vided, among other things, for reducing war veterans’ benefits. 10
To Couzens, this smacked too much of the old Hoover attitude, as
he saw it, of causing the poor to bear the brunt of the depression.


THE INDEPENDENT MAN
256
He noted with distrust that Roosevelt's Economy Bill had the back
ing of all the Old Guard elements, in and out of Congress, that on
this occasion at least, Big Business was solidly behind Roosevelt, as
it had been behind Hoover. Indeed, Hoover in his heyday never
received the plaudits of the conservative press with such unanimity
as did Roosevelt at this time. 11
In the Senate, with all his old-time directness Couzens stormed
against this measure, going so far as to charge that members of Con
gress were threatened by White House “representatives" if they
did not fall in line. 12 Indeed, on this occasion, he made one of the
longest speeches of his career, a bitter attack on the administration,
as bitter as any he had made on Hoover's.
At just this time, the Treasury had arranged to float a note issue
of $800,000,000, and asked and obtained approval from Congress
to pay to the purchasers a higher than usual rate of interest. Couzens
contrasted this with the Economy Bill.
“I hope that any member of this body who has the nerve to walk
out of this chamber after having voted for this iniquitous measure
will hang his head in shame for having approved of an increase of
100 to 180 per cent in interest rates for the money lender, while
he would take away from the veterans 45 to 50 per cent of their
small allowances."
It was untenable, he said, for the “National Economy League,
the big business organizations, and the Chambers of Commerce" to
argue that the credit of the nation was in danger unless the Economy
Bill were passed. The per capita debt of the nation, he pointed out,
was only $160, whereas for Great Britain it was $800. To him this
did not indicate that the United States was in desperate straits from
the standpoint of debt.
“Yet it is said that the little man who is getting $30 or $40 a
month because of the service he performed for the nation must have
his compensation cut. Mr. President, I should hope to be stricken
dead, if I walked out of this chamber after having voted for such
an iniquitous measure to do such great injustice to the people who
are least able to stand it." 13
The Economy Bill was passed the next day, with twelve senators
in addition to Couzens daring to vote against it. Considering Roose
velt's popularity and the strength of other forces behind the bill—
even National American Legion Commander Louis A. Johnson
(later rewarded with an office) supported the veterans' cuts—it was


THE NEW DEAL ONLOOKER
*57
remarkable that a dozen senators sided with Couzens. 14 Curiously,
as in the Acheson matter, Roosevelt later again came around to
Couzens* view, for in a matter of weeks, he began issuing a series
of executive orders ameliorating the effects of the Economy Bill
and in the end almost all of the veterans* cuts were restored. 15
5
Roosevelt in the meantime went forward with enough other legis
lation more in keeping with the general promises of the New Deal
and Couzens* hopes for it. Especially was Couzens delighted that,
either from emulation or by coincidence, Roosevelt had recom
mended to Congress a variation of his own idea for taking care of
the jobless young people who had been roaming the highways. Like
Couzens, Roosevelt insisted that these youngsters had to be pro
vided for, and proposed the Civilian Conservation Corps program.
Couzens recalled with disgust how the Army had opposed his
proposal in that regard because, as he angrily told the Senate, “the
aristocracy of the Army did not wish to be annoyed** with “taking
care of jobless and homeless boys.** Some day, he said, this same
“Army aristocracy** will want these boys as soldiers, to fight for
their country. But now “it did not care what happened to them.**
This was a “shameful attitude,** he declared. 16
When told that his proposal would be expensive, involving an
additional cost to the Army of some $88,000 a day, his answer was:
“We appropriate millions for the problem of migratory birds and,
though it is hard to believe, there is complaint now heard when
we wish to appropriate money for the care of migratory boys.**
For his part, he said, he “did not care what it cost.** The question
was, “What are we going to do about these boys?** X1
“During the nearly eleven years that I have been a member of
the Senate, I have seen almost every kind of legislation go through
in the interest of business. I have not opposed these measures. I am
not against the railroads or other business. I want to see their in
tegrity maintained. But I also want to see maintained the integrity
of the youth of our land, and I want to see them preserved.
“I have heard the words ‘fundamental* and ‘sound policies* and
‘economy* and so on, until I am sick and tired. The whole United
States ought to be sick and tired of the constant repetition of such
words while millions and millions of our people are in distress.** 18
His proposal had been lost in the closing days of the last Hoover


THE INDEPENDENT MAN
258
Congress. Even a large number of Democrats had opposed him,
joining in charges that his scheme was “demagogic.” But now Roose
velt placed all his influence behind the CCC proposal. This time the
Army, if it still had objections, suppressed them, and the plan was
adopted.
It turned out that of all the New Deal projects, the CCC program,
with its emphasis on reforestation, although of minor significance
in the larger scheme of things, was the most popular. Although it
would be stated that the idea for it was Roosevelt's “own,” Couzens
always felt that he was at least a co-parent of it. It was certainly an
example of parallel thinking on his and Roosevelt’s part. A specific
problem, that of the jobless youth, existed; the way to meet it was
to come up with a specific act. This appealed to Couzens. At last
the government was ceasing to “play ostrich.”
There was more, much more, in this first Roosevelt phase that
satisfied Couzens beyond his expectations. Roosevelt easily pushed
to adoption such changes in the banking laws as compulsory divorce
ment of investment affiliates from commercial banks, which in itself
might have prevented the Detroit disaster. He caused Congress even
more easily, without even waiting for the pledged repeal of the
Eighteenth Amendment, to revise the Volstead Act to permit the
sale of 3.2 beer. ”1 think this would be a good time for beer,” Roose
velt said, and it was done. 19 Here also was personal vindication for
Couzens—ten years after he had said, in opposition to Harding and
the Anti-Saloon League, that the Volstead Act ought to be modified.
In breathtaking succession, came a new act for the small-home
owners of the nation, a Home Owners Loan Corporation, which
substantially met Couzens’ objections to Hoover’s Home Loan Bank
act, for it provided direct aid to the home owners; and the Tennessee
Valley Authority Act, which at long last decided the question of
Muscle Shoals as Couzens as well as Norris and, of course, other
progressives and liberals of both parties for years, had wanted it
decided. As Couzens wrote to a protesting constituent, “My approval
of TVA was the result of years and years of fighting here in Congress
about what was to be done with Muscle Shoals.” 20
Then came an unemployment relief act, which willingly, rather
than grudgingly, made federal funds available for direct relief to the
needy as well as for providing jobs. Also an act for federal regulation


THE NEW DEAL ONLOOKER
259
of the sale of investment securities, which for the first time enacted
into law, in so far as this field was concerned, a code of ethics which
Couzens, along with such liberals as William O. Douglas, had al
ways insisted ought to prevail among bankers; and an act for
emergency railroad legislation that incorporated many of the views
Couzens had fought for against Hoover, in his capacity as chairman
of the Senate Committee on Interstate Commerce.
Indeed, as it began to take shape, the New Deal was in fact already
an enactment of so many of the ideas Couzens, along with other in
dependents and progressives, had been plumping for since the days
of the elder La Follette, that it could properly, in a way, have been
styled as much a Couzens program as a Roosevelt program. No
wonder that Senator McNary—who had not long before got a laugh
from Couzens by sending him a crate of prunes from his Oregon
farm with a note, “These are of a new variety, thus somewhat
radical”—observed :
“Couzens fell in love with the New Deal.” 21
7
This was true.
Toward the end of May, Roosevelt came up with the most sweep
ing of all his measures in his honeymoon period—the National In
dustrial Recovery Bill (NRA).
Couzens felt cause to be truly elated over this many-sided meas
ure. Here in one package were recommendations in principle if
not in exact detail which constituted implementation of most of
the major positions he had championed ever since he had been in
public life, a program harking back to his mayoralty, when Detroiters
called him a “Bolshevik” for the way he took care of the unemployed
during the depression of 1920-1922: prohibition of child labor; the
right of working men to organize; shorter working hours to stagger
employment with decent wage levels protected; and a gigantic public-
works program precisely in line with that “fantastic* * interview he
had given to Ray Tucker back in 1931.
True, the NRA also involved some provisions, notably the “codes**
permitting exemptions from the anti-monopoly laws, and also some
omissions in the matter of wage rates on public-works projects, to
which he would find himself in disagreement, or not certain of. But
on the whole, the NRA, as it was first projected, appeared almost
a millennial event from Couzens* point of view. On the basis of his


a6o
THE INDEPENDENT MAN
past, this was precisely the kind of program he would have come
up with, had he been President.
Taken with Roosevelt's boldness in going off the gold standard,
which reversed the deflationary trend of the Hoover era, and the
drastic farm-relief measures, which for once all the farmers' organiza
tions agreed upon and practically drafted themselves, a fact that
persuaded Couzens to vote for them, the NRA looked like a com
plete break with the Old Guard traditions in America, albeit even
Hoover had been moving against his will in the same direction. 22
As Frank Kent correctly observed at the time, the new Democratic
administration had really taken over the program, not of the historic
Democratic party, but of the Progressive insurgents in the Republican
party, in which Couzens, if anywhere, actually belonged. 23 The “nice
and decent revolution," forecast by William Allen White ten years
earlier, almost to the day, had come to pass, apparently. To ac
complish it, Roosevelt had supplied the needed cohesive force, which
the Progressives, all intensely individualistic, never achieved. 24
Moreover, Roosevelt's legislative assistants had on several occa
sions showed a marked disposition to do what the previous Re
publican administrations almost never did—consult with Couzens
as well as other independent Republicans, on the drafting of legis
lation.
A case in point was the securities regulation bill. The New Deal
historians Joseph Alsop and Robert Kintner would say that Couzens
was responsible for the securities bill having been introduced and
passed much earlier than Roosevelt had intended. “Prepared at
the mere request of one of Ferdinand Pecora's assistant investigators,
it was only introduced because Senator Jim Couzens suddenly de
cided the time was ripe for an exchange bill." 25 This was not the
whole story, but there is enough truth in the statement to show
how things had changed in his relations with the White House.
8
Yet after the first excitement over the Roosevelt approach had
died down, Couzens was not really as happy as he had expected to be.
Across the land, people hummed the New Deal theme song, “Happy
Days Are Here Again!" There was a feeling that Roosevelt would
take care of all the nation's ills. But Couzens still saw the heart
breaking effects of the continuing depression.
True, people no longer faced the danger of actual starvation


THE NEW DEAL ONLOOKER 261
amidst plenty. But there was still much hardship, and the basic
causes remained.
“The misery I am going through here because of nationwide
conditions is beyond telling in a letter,” he wrote his brother Al
bert on May 26, 1933, nine days after Roosevelt sent the NRA bill
to Congress.
This comment pointed up a facet of Couzens’ nature that few
people recognized. As with crippled children, he identified himself
emotionally with victims of the depression. “He suffered physical
pain that was real over the plight of the unemployed,” Hiram John
son observed. 26
Each day’s newspaper continued to emphasize millions of Ameri
cans still were without jobs, that relief rolls were still growing. For
once, he even sympathized with some rich persons, whose investments
had turned sour, especially in Detroit bank stocks. “I never expected
to live to see the day when so very many even wealthy people are
absolutely broke, when heretofore well-known rich people hardly
know how to get a living,” he told his brother. 27
On top of this, all the aggravation of the bank crisis had taken
from him a physical as well as mental toll. More than ever, he
suffered from sleepless nights. He was desperately in need of a rest.
But instead of relaxing, he plunged now, during that spring of Roose
velt’s first period, with all his bulldog strength into an investigation
of J. P. Morgan and Company, an activity not calculated to be a seda
tive for his nerves.


CHAPTER XXXIX
THE INVESTIGATOR AGAIN
The inquisition of the House of Morgan began May 23, 1933, in
the marble-floored conference room of the Senate Committee on
Banking and Currency. In certain quarters it would be labeled a
"‘circus,” especially after the incident engineered by a press agent
of having a midget suddenly plump himself on Mr. Morgan’s lap.
But in truth this inquisition was one of the most important ever
conducted by a Congressional committee in terms of its revelations
as to the inner workings of interlocked finance and politics.
It was a continuation of the investigation into stock-market
practices that the same committee had been conducting off and on
for more than a year. In a large sense, it was also an extension of
the investigation by the Senate Finance Committee two years earlier
into the processes by which Americans had lost so heavily on Cuban,
Peruvian, and other foreign bond issues. Taken together, the two
inquiries furnished an especially candid picture of both domestic
and foreign financial practices in the era of “wonderful nonsense.”
Even before the House of Morgan was subjected to inquiry, the
stock-market investigation, called off during the 1932 election cam
paign, already revealed enough to permit Charles and Mary Beard
to summarize:
Page after page of sworn testimony showed that mighty men
among the Lords of Creation had formed “pools” for particular
stocks and bonds, run up the price of securities, poisoned the news
of financial columns by the bribery of reporters, drawn unwary
sheep into the pens of bulls and bears and sheared them as the
bottom fell out of liquid claims to wealth. 1
While J. P. Morgan and Company had been mentioned now and
then in some of these amazing transactions, and one of its prominent
partners, Lamont, had been questioned by the earlier Senate Finance
Committee inquiry into foreign loans, the impression had persisted


THE INVESTIGATOR AGAIN
263
that, on the whole, it had been above yielding to any challengeable
practices. The House of Morgan, it was believed, was so strong and
so circumspect that it had no need to adopt methods that could not
stand senatorial scrutiny.
2
Now, however, the House of Morgan was subjected to its first
thorough investigation since the Pujo inquiry of two decades before.
It was understood that Roosevelt urged this personally, on the
theory that the more adverse attention obtained by J. P. Morgan &
Company, the more amenable Congress and the nation would be to
New Deal legislation. In the words of Ernest K. Lindley, “To put
the House of Morgan on the defensive immediately was to the
Administration’s advantage. To establish definitely and expose its
position in the economic and political world was a necessity pre
liminary to reforms that would go far beyond the improvement of
the banking system.” 2
In this inquiry, Couzens, even though now a minority member
of the Banking and Currency Committee, played a prominent role.
He was “merciless in his judgments and caustic of tongue,” recalled
Stokes. 3 Indeed, even though the committee finally retained Ferdi
nand Pecora, a hard-hitting New York City prosecutor, as counsel,
it is doubtful if the House of Morgan investigation would have
been so incisive if not for Couzens’ participation.
A number of the other senators, including even the usually acid-
tongued Senator Glass, seemed overawed by the prestige of this
firm and especially of its head, J. P. Morgan himself. They reflected
the attitude, reported on by Frank R. Kent in the Baltimore Sun,
of “a number of people who talk about the ‘terrible outrage’ of a
Senate committee dragging Mr. Morgan and his partners down here,
cross-examining them like a lot of chicken thieves, and making it all
a sort of Roman holiday.” 4
There was a tendency to handle Morgan with soft gloves, to show
deference to him that was denied other bankers. Couzens put a stop
to that. He had no more reverence for Morgan than he had possessed
for Mellon. He agreed wholeheartedly with Frank R. Kent. “There
should be nothing sacrosanct about the House of Morgan.” 5
At one point, Couzens engaged in a row with Senator Glass when
the Virginian declared that Pecora should be more respectful and
less barbed in his questioning of Morgan. “I insist that Mr. Morgan


THE INDEPENDENT MAN
264
be treated like anyone else here!" snapped Couzens. He pounded
the table. Glass backed down, 6 and from then on, Pecora, with
Couzens' backing, went after Morgan without gloves. 7
3
The results were startling enough to shake even a man so sus
picious of other wealthy men as Couzens. The inquiry disclosed that
J. P. Morgan and Company not only had engaged in many, if not
all, of the practices common to the other firms already investigated,
but, in one respect, had gone even further. Thus, while other firms
had seduced mere newspaper editors and reporters to help win their
cooperation for unloading inflated stocks on the public, the House
of Morgan, it was now revealed, had apparently succeeded, by the
device of so-called “preferred lists" in winning the influence, favor,
or silence, of many of the most outstanding public figures of the
nation. This seemed at least a fair inference when it was revealed that
persons on the House of Morgan “preferred lists"—men permitted
to purchase stocks in advance of the public sale at prices considerably
lower than the public paid—included such public dignitaries as:
Former President Coolidge; Newton D. Baker, President Wilson’s
Secretary of War; Charles Francis Adams, Hoover’s Secretary of
the Navy; Charles D. Hilles and J. R. Nutt, officials of the Republican
National Committee; Silas H. Strawn, former president of the United
States Chamber of Commerce and law partner of Garrard Winston,
Mellon’s Undersecretary of the Treasury; Norman H. Davis, even
then functioning as Roosevelt’s ambassador-at-large in Europe on
the question of war debts; John J. Raskob, former chairman of the
Democratic National Committee; John W. Davis, 1924 Democratic
Party nominee for President; General of the Army John J. Pershing;
William G. McAdoo, Secretary of the Treasury under President
Wilson and then Democratic Senator from California; and—most
interesting of all to Couzens—William H. Woodin. 8
It seemed obvious from this list that, in the game that was being
played, the leaders of both parties were on equally good terms with
the House of Morgan.
Couzens was among the first to comment pointedly on this bi
partisan financial policy of the nation’s great. “When it comes to
money," he told the press, “there are no Republicans or Democrats.
Rich men never fight each other seriously. There is the finest coalition
of all parties when it comes to control of the Treasury of the United
States." 9


THE INVESTIGATOR AGAIN 265
This is what he had contended all his public life, and now evidence
demonstrating his position had been produced.
The Morgan partners insisted that in most cases they did not
even know the political affiliation or standing of their “preferred”
clients and that “influence” was the last thing the firm had counted
upon in letting these individuals in on chances to make gigantic
killings in the stock market. 10 Probably some persons believed these
disclaimers. Couzens was not among them.
Couzens questioned George Whitney, partner of J. P. Morgan
and Company, also director in large corporations, on the motives
behind the preferred lists. The banker protested, “perhaps too
vehemently,” he later conceded under questioning by Couzens, 11
that the lists were for purely business purposes, not for getting
favors from high-placed individuals in politics and government.
It had been brought out, as one example, that J. P. Morgan &
Company had distributed to the individuals on its preferred list
shares of Johns-Manville Corporation at 47^ in June 1927, whereas
when the stock was offered to the public a few weeks later, the stock
sold at 79, “representing a potential combined profit to the members
of the selected lists of $12,037,500. 12
SENATOR COUZENS:
MR. WHITNEY:
SENATOR COUZENS:
MR. WHITNEY:
SENATOR COUZENS:
MR. WHITNEY:
SENATOR COUZENS:
MR. WHITNEY:
SENATOR COUZENS:
You said the only object was that these men you
distributed the stock to would make money?
I did not say our only object. I said we hoped
they would.
That was not the only object you had?
No sir.
You hoped they would reciprocate?
No, really.
You did not give them this price so that they
would reciprocate and keep on good terms?
No, really. That is, of course, the suggestion that
has been carried in the testimony yesterday, and
in the papers, but I can only tell you that is not so.
I never heard of anybody quite so altruistic in my
life! 18
4
Nor did the Senate committee as a whole believe that altruism was
the explanation, for it finally summed up:
The preferred lists strikingly illuminate the methods employed
by bankers to extend their influence and control over individuals
in high places. The persons upon whom princely favors were be
stowed in this manner were . . . persons prominent in all the


266
THE INDEPENDENT MAN
financial, industrial and political walks of our national life. The
granting of these preferential participations . . . augured well for
their mutual welfare and ill for that of the public. 14
Of special interest to Couzens was testimony about certain taxation
practices of the House of Morgan. This part of the inquisition pro
duced unexpected corroboration of the significance of his investiga
tion of Mellon and the Bureau of Internal Revenue almost a decade
earlier. He had charged then that the Bureau, under Mellon, had
favored wealthy individuals and corporations. The House of Morgan
was not then involved. Now it was.
Mr. Morgan himself was forced to give testimony showing that
the Bureau of Internal Revenue, during the period that Mellon
was Secretary of the Treasury, exercised exceptional discreetness in
matters in which the House of Morgan was concerned.
The committee later said in its report:
Internal-revenue agents accepted without examination income-
tax returns prepared by J. P. Morgan & Co. on the assumption that
preparation by that firm ipso facto established the correctness of
the returns. For example, the tax return of Mrs. Margaret Y. New-
bold for the year 1928, prepared by J. P. Morgan 8c Co. bore the
following legend:
“Returned without examination for the reason that the return
was prepared in the office of J. P. Morgan 8c Co., and it has been
our experience that any schedule made by that office is correct. The
books of the taxpayer are located in Philadelphia, and if necessary
schedule C may be verified in that city. This office, however, recom
mends that the return be accepted as filed. C. M. Sheppard, Internal
Revenue Agent.”
Many other returns, particularly of partners in large banking
houses, were likewise exempted from adequate scrutiny. When ex
aminations were made, the time devoted to them was comparatively
short, in view of the wealth of the taxpayers and the complex nature
of their transactions. Thus, in 1930, according to the Bureau's own
records, 1 day was spent in checking the partnership return of
J. P. Morgan 8c Co., and Drexel 8c Co.—the most powerful banking
group in the world. This return was not subjected to any field ex
amination, and apparently the agent's explanation was sufficient to
satisfy the Internal Revenue Bureau that none was necessary. 15
The Senate committee reported: “For the year 1930, 17 Morgan
partners, including J. P. Morgan, paid no tax and 5 paid aggregate
taxes of about $56,000. For the year 1931, not a single Morgan
partner paid any tax. For the year 1932, not a single Morgan partner
paid any tax.” 16


THE INVESTIGATOR AGAIN
267
It was all dramatic vindication of Couzens’ crusade against Mellon-
ism, which Senators Moses and Watson, as well as others, including
Mellon himself, characterized as merely a “private feud,” or just
a demonstration of Couzens’ “terrible temper” and nothing more. 17
5
There was still further personal vindication for Couzens in these
hearings. He had been criticized back in the spring of 1932 for
having opposed a loan of millions of dollars from the RFC to a rail
road because, he charged, the loan actually would go to J. P. Morgan
& Company, which did not need it. The inquiry brought out that
it was the House of Morgan that had suggested that the railroad
apply for the loan and press it, over disapproval by the Interstate
Commerce Commission, and that $5,850,000 of the government
money promptly found its way into the coffers of the banking firm. 18
Supremely corroborative as they were of much of Couzens’ career
in the Senate, such revelations did not, however, really please him
as much as many persons supposed. Reporters and others took it
for granted that the “Scab Millionaire,” who preferred needling rich
men to anything else, as it often was said of him, would be ecstatic
over the House of Morgan inquisition. Actually, he was not. Such
revelations merely added now to his painful frame of mind.
Coming on top of the Detroit bank episode, the findings of the
Senate committee left him more acutely depressed than ever. He
was being eaten up inwardly by suppressed hostility toward men
like Morgan, who, he felt, ought to have behaved differently than
he feared they had. He was not at all anxious to have it proved that
the whole American business system, as it seemed to him, had been
corrupt to the very highest pinnacle.
The day-after-day testimony to greed, irresponsibility, chicanery,
and corruption, not of politicians and gangsters, but of the most
respected persons in society, left him appalled. Former Governor
James M. Cox of Ohio later had some conversations with him which
caused Cox to conclude: “The world he was living in . . . gave him
great concern, and he worried too much about it.” 19
This was all too true. He was more and more tense; more and
more in need of a change of scene.


CHAPTER XL
THE DELEGATE TO LONDON
Roosevelt unexpectedly opened the way to his needed change of
scene. Summoning him to the White House for a 9 a.m. meeting, but
without telling him the purpose, Roosevelt had Couzens ushered into
his private apartment. The President was still in bed, having break
fast and reading the newspapers, which informality (inconceivable
with Coolidge or Hoover) so impressed Couzens that instead of
setting down in his notebook the reason for the visit, he wrote: “Saw
Roosevelt in his pajamas.” Roosevelt promptly sprung on him the
offer of an appointment as a delegate to the World Economic and
Monetary Conference scheduled to open in London in June.
Roosevelt had been scouting around for a suitable Republican
on an otherwise Democratic delegation, and Senator McNary men
tioned Couzens’ name to him. With certain other Republican pro
gressives, McNary had begun hinting to Roosevelt that Couzens
would be a good man in his cabinet as Secretary of the Treasury, if
only because of his stand against Mellonism. The London assignment
looked to McNary like a step in that direction. Besides, McNary
was worried over Couzens’ health and believed the trip would be
good for him. Though wary of Couzens’ independence, Roosevelt
quickly fell in with the suggestion. He saw that Couzens fit exactly
what he had in mind—a Republican who was sympathetic, openly
so, toward the New Deal. 1
With Mrs. Couzens, John Carson, and Jay Hayden, whom the
Detroit News assigned to cover his activities, he sailed for England
on June 6, 1935.
2
This was his fifth transatlantic crossing. His first, back in 1891,
when he accompanied his father on a visit to London, was made just
268


THE DELEGATE TO LONDON
269
after he had begun his life in Detroit, still a Canadian. Oddly, in
view of the purpose of this latest crossing—to help solve the deepest
world monetary questions—his main impression of his first visit
to London was the trouble he had experienced in keeping his
American money straight in terms of pounds and shillings. 2
The second and third trips abroad, in 1907 and 1909, had been
in connection with the Ford Motor Company. Memories, some
sharp, even poignant, naturally would be evoked from thinking
of those days—of his early association with Ford, of Malcomson
(dead ten years by 1933), of the Selden case, of the negotiations
with Durant for selling the Ford company which, if they had gone
through, would have left him one-fourth owner of General Motors
(bigger than Ford now), of the five-dollar-a-day plan ... of, in
deed, the many phases of the whole Ford story.
Not all such memories were wholly pleasant. The break with
Malcomson had not been pleasant. Nor the break with Ford. Then,
too, there was the great sadness of his life, the death of that promising
boy, Homer. Nobody else could ever know how deeply that tragedy
had affected him, of what pleasure in life it had robbed him. Never
had he ceased to reflect on the shining hopes of achievement he had
held for Homer. 3
True, his other son, Frank, had not done so bad. Indeed not!
In 1933, Frank was the Mayor of Detroit. That had happened because
Roosevelt, two weeks before he asked Couzens to go to London,
appointed Mayor Frank Murphy as High Commissioner of the
Philippines. As president of the Detroit Common Council, Frank
Couzens succeeded to Murphy’s job as Mayor. “I’ve lived pretty
well, don’t you think, to have raised a mayor?” Couzens said to
reporters who interviewed him just before he left for London. 4
Thoughts of Frank in his own former office in the grimy old
Detroit City Hall were bound to bring to mind his own mayoralty,
as well as his earlier term as police commissioner. How serene the
world had appeared to most persons in that era! Possibly some
remembered that on returning from his fourth visit abroad, in
1923, he had pointed to danger signals in Europe and suggested a
receivership for Germany. These ideas were laughed at or denounced,
and especially was this true of his assertion that the United States
ought to play a more positive role in international affairs so as to
help avoid another world war which he felt was brewing already in
Germany. Now, ten years later, this conference, to which he was a


270
THE INDEPENDENT MAN
delegate, had been called precisely because such warnings had been
ignored. The economy of the whole world had gone to pot, just as
the economy of the United States had gone to pot, and another
world war would, in fact, be the result in six more years. In Germany
Hitler was already in power.
Coolidge had been President when Couzens returned from that
fourth trip. Just ten years ago—and it seemed centuries.
Poor Coolidge! Only the previous January 1933 he had died,
heartbroken, it was said, because even to him it was plain that
“Coolidge prosperity" had been built on sand. Coolidge had seemed
so wise in saying, “The business of America is business," or when,
on the international debt problem, he had commented, “They
hired the money, didn’t they?" Yet he lived long enough to realize
that such “Yankee talk" was not so statesmanlike as he had supposed.
The Coolidge world—Andy Mellon’s too—had crashed utterly.
Even the banks in Northampton, Massachusetts had closed. 3 * 5
That the London conference, for which he was making this new
trip to Europe as he was turning sixty-one, would help the world
to recover economically was a hope that Couzens shared with many
others. He had seldom talked in the Senate about foreign affairs,
yet he had a greater awareness than most of his colleagues—certainly
more than most of his fellow Middle Westerners, especially the other
progressives—of the perilous position of the world and the impact
of foreign conditions upon the United States, as witness his warning
in 1923 to Coolidge about “Hiram Johnson’s isolationism.” He
knew that the major powers, the United States included (with the
Smoot-Hawley tariff act of 1932 especially), were engaged in a form
of economic warfare. He hoped that the London conference might
change this pattern and bring “economic disarmament" as a step
for preventing the resort to military force. “On every side there
are possibilities . . . more ominous than any since 1914/’ said
James W. Angell, American member of the Preparatory Commission
of the conference, in March 1933. And Couzens agreed as he sailed
for England. 6
3
Unhappily, the London conference proved unworthy of the hope
it had inspired. It had been ill timed. It ought to have been held
many months earlier, when first planned under Hoover, or not at
all. For economic stabilization, as a condition precedent to the break
ing down of barriers to international trade, was the principal goal,


THE DELEGATE TO LONDON
271
yet stabilization at that juncture was precisely what the Roosevelt
New Deal was against. For stabilization then meant settling for the
deflationary level of the depression. “Reflation,” not stabilization,
in the United States, was the Roosevelt goal, and he had flatly said
in his inaugural that this must come ahead of international arrange
ments.
On arriving in London, Couzens found himself in an atmosphere
of gloom because no one expected the meeting to succeed. “Every
thing within the delegation was all so riotously unhappy,” recalled
Herbert Feis, economic adviser to the United States State Depart
ment. 4 * * 7 Nor were matters helped by the British. It had been specif
ically agreed, or so it was thought, that the question of war debts
would not be brought up. Yet Prime Minister Ramsay MacDonald
in his opening address, seconded by Neville Chamberlain, then the
Chancellor of the Exchequer, brought up precisely this question. 8
Then, just after Couzens arrived, the conference faced a kind of
sit-down strike. No monetary stabilization, no action on anything
else that the agenda provided, such as toning down tariffs, exclusive
trade agreements, dumping, and the other impediments to free trade
in the world—such was the tacit position of France. It was no wonder
that Couzens later said he was under “a terrific strain” there “trying
to be diplomatic.” 9 Frustration engulfed everyone.
4
He was appointed to the monetary and financial commission. It
was there that the struggle over stabilization centered. As always,
he took his responsibility seriously and worked hard at it. Mrs.
Couzens wrote to Madeleine, “Daddy’s hours are from 9:30 in the
morning until 7:30 in the evening, sometimes later. . . . He is
quite tired.” 10 But he was not long in discovering that the con
ference was involved in an irreconcilable conflict: nationalism
versus internationalism.
On June 19 he expressed himself candidly to the conference on
this impasse. “The nations have not suffered enough to be willing
to meet in complete humility. . . . Most nations are still rather
cocky about their nationalism and feel confident that they can
paddle their own canoes, whether anything comes out of the con
ference or not.” 11
Of all the utterances at the gathering, this most bluntly exposed
the impasse. The Times of London placed over it a headline that
showed that in one statement he had been capable of making in


THE INDEPENDENT MAN
272
London the same impression for which he was most noted in Wash
ington: “PLAIN SPEAKING.”
5
Not even the American delegation was in agreement within itself
on a program. There were some in the delegation who wanted to
agree to currency stabilization after all, in spite of Roosevelt. A
resolution to that effect was drawn up, but word came from Roosevelt
that he was against it. “The whole conference very nearly broke up
in disorder,” recalled young James P. Warburg, one of the advisers
to the American delegation. 12 Couzens sided with Roosevelt. “We
must work together,” he said in a statement showing that he was
shelving his mild internationalist views, at least temporarily, to
embrace fully Roosevelt’s program of “First things first.” 13
But unity remained the one thing the delegation could not
achieve. “On one day at the conference,” recalled Raymond Moley,
then a confidant of Roosevelt and Assistant Secretary of State,
“Senator Couzens spoke against tariff reductions and, on the next,
Representative McReynolds asserted that lower tariffs were necessary
to recovery. To complete the impression created by this episode, Mc
Reynolds denounced the Republican party as though he were making
a speech on the floor of the House.” 14 This was typical.
When it was suggested at a meeting of the American delegation
that no one speak for publication without the approval of Secretary
of State Cordell Hull, the delegation chairman, Couzens refused to
be bound by such a rule. He “intended to voice his opinions to the
press on all matters at any time,” he said. 15
His insistence on his independence did not endear him to Hull,
who later asked Moley to convey to Roosevelt a pointed message.
The President should “not give Progressive Republicans too promi
nent a place in the administration, since they didn’t seem capable of
working with anybody.” 16 Roosevelt of course knew that Couzens
in London was more in line with “the administration” than was
Hull, for Hull did not believe that economic recovery in the United
States could come from domestic action alone. 17 After a row with
Hull, one of several, Couzens threatened to resign. 18 Mrs. Couzens
expressed his feelings when she wrote to Madeleine: “If the policy
of this conference does not change and get a little more pep and
sense into it, I am sure Daddy will pack up and get out of it all.
This crowd is going around in circles.” 19


THE DELEGATE TO LONDON
273
Only Hull’s pleas that Couzens’ resignation would prove a serious
embarrassment and that he should at least stand by until the expected
arrival from Washington of Moley, caused Couzens to stay on. But
after this, he devoted himself mainly to championing aggressively
the Roosevelt program for increasing employment in the United
States through public works and to urging all other nations to do
likewise. “I am enthusiastic about what President Roosevelt is
accomplishing, if press reports are correct,” he wrote to Tom Payne
concerning news about the NRA, which went into effect on June
16. In the same vein, during a formal speech before the monetary and
financial commission, he argued that the nationalistic Roosevelt
program be made international, that all the nations do as the New
Deal was doing—an idea that Roosevelt, cruising on a destroyer
off the Atlantic coast, almost at the same moment was expressing
to Moley. 20 Thus did Couzens try personally, albeit naively, to
bridge the unbridgeable gap that then existed between nationalism
and internationalism.
When Moley arrived in London on the next day, he immediately
took the spotlight as one who had recently been with Roosevelt.
Would Moley be able to break the deadlock on the question of
monetary stabilization? He tried his hand. At the American embassy,
during a secret meeting which Couzens attended, he drafted the
text of a suggested resolution which was forwarded to Roosevelt. It
committed no nation to anything except a desire to return to the
gold standard when it was deemed proper to do so. Couzens sensed
that Roosevelt would not approve even this innocuous resolution.
Thoroughly disgusted by then—the more so since Hull had
raised objections because he had been in on the embassy meeting,
whereas Hull had known nothing of it—Couzens informed Moley
that he wished to resign forthwith. 21 But again yielding to an appeal
not to bring into the open the pitiful division within the delegation,
he agreed to remain at least until Roosevelt responded to the resolu
tion forwarded by Moley 22 "If this conference does not come to some
understanding soon, poor Daddy will blow up,” Mrs. Couzens wrote
to Madeleine 23
When Roosevelt responded on July 3, his message said that the
conference should not "allow itself to be diverted by the proposal
of a purely artificial and temporary experiment affecting the mone-


274
THE INDEPENDENT MAN
tary exchange of a few nations only. . . 24 Whatever was Roose
velt’s intent, the effect of his pronouncement was to bring the con
ference to an end for all practical purposes. 25 Again there was talk
of resignation, this time not by Couzens, but by Hull. 26 Indeed, it
was Couzens, in the unusual role of pacifier, who stood out among
those who tried to save the conference from wreckage. He made
a speech attempting to explain America’s position and urged: “The
conference must go on with the work for which it was summoned.’’ 27
But almost no one shared his view that anything still could be ac
complished, and his heart was really not in the effort.
7
After this, the conference became just an occasion for social
gatherings. These were interesting, of course. At one of them Mrs.
Couzens met “the lady that the Prince of Wales is so devoted to,
and had a charming visit with her.” But soon even the parties grew
boring to everyone. London’s weather turned uncommonly hot.
“Poor Daddy will be a wreck—it is so hot,” Mrs. Couzens informed
Madeleine on July 7. “Besides, everyone of our delegates is very
unhappy over the turn affairs have taken and are undecided what
to do.” 28
But Couzens knew what he intended to do. He made reservations
to sail for home without waiting for the official adjournment. He
did not, however, get away before being involved in one more irritat
ing incident. Roosevelt had asked Moley to send him a confidential
estimate of the American delegation. In complying, Moley dep
recated in frank terms all the delegates except Senator Pittman.
He had marked the message “Secret from Moley, to the President
Alone and Exclusively.” But an embassy employee showed a copy to
Ambassador Robert Bingham, who showed it to Hull, who saw to
it that Couzens, among the others mentioned, read the Moley com
ments. Especially wrathful because just previously Moley had
“particularly praised him to his face,” Couzens gave Moley a tongue
lashing. No wonder John Franklin Carter summed up the whole
conference as a “diplomatic bedroom farce.” 29
Thus at the end as at the start, this interlude, “a Donnybrook
Fair,” as Moley accurately called it, proved a poor sedative. 30
Especially was this so in view of still another eruption, one occur
ring in Detroit, that disturbed Couzens as much as the frustrations
in London, indeed even more.


275
CHAPTER XLI
THE SMEAR
The Detroit bank case had re-exploded.
Couzens first learned of this development between sessions in
London when Jay Hayden showed him a cable from his newspaper,
the Detroit News. The cable asked Hayden to get Couzens' comments
on testimony given before a one-man grand jury that day by Clifford
Longley, the Ford attorney and the latest president of the defunct
Union Guardian Trust Company. 1
Asked why the original RFC loan to the Guardian Group did not
go through, Longley had said, “There was considerable opposition
in Washington."
“Why and by whom?"
Longley had paused for a moment. He laced his fingers together,
and smiled. “Well, I think the largest single opposition to the loan
in the amount we were asking came from Senator Couzens." Couzens
“was very antagonistic," he said.
He “gathered" that “Couzens was very much put out because of
our not coming to him in the first place." He “gathered" that
“Couzens opposed the loan very strongly." He “gathered" that
“Couzens’ opposition stopped the loan.” 2 All of which was reason
enough for most of the Detroit and Michigan newspapers to carry
banner lines on one theme:
COUZENS BLOCKED LOAN FOR BANKS!
2
It was soon apparent that this grand-jury investigation, presided
over by Judge Harry B. Keidan, supposedly called to reveal the facts
behind the bank crisis, actually was maneuvered from the beginning
into an elaborate device for pinning the blame for the whole tragedy
on Couzens personally.


THE INDEPENDENT MAN
276
At first, Couzens was not overly disturbed. Not even when a cable
reached him from his lawyer-friend, Tom Payne, asking his per
mission for Payne to go before Judge Keidan to ask that the inquiry
not be adjourned until after Couzens had testified. Couzens cabled
the permission, and also dictated to Hayden a rejoinder to the
Longley testimony to be published in Hayden’s paper.
His answer to Longley was a notably calm statement, wholly
devoid of acrimony. In it he reviewed briefly the Guardian Group
loan application of January 1933. He pointed out that none of the
RFC directors had approved the loan application, and that this
was also true of those who attended the White House conference.
Recalling that Senator Vandenberg attended the White House meet
ing, he suggested that Vandenberg be “consulted for details.” 3
The News did query Vandenberg. From Grand Rapids, he issued
a statement which, while cautious, fully upheld Couzens.
“There is no question,” Vandenberg said, “that Senator Couzens
is correct when he says that at the initial conference no one felt,
on the basis of the figures submitted by the RFC, that the program
could be put through as originally requested. This included Ogden
L. Mills, Secretary of the Treasury, Charles A. Miller, president of
the RFC, and President Hoover himself.” 4
3
That seemed to take care of matters very well. On June 22,
Couzens wrote to Payne, “Do not hesitate to make any expense to
keep me informed and to protect my name, because I have nothing
to hide and no financial interest to protect or to hazard.” 5 Then he
placed the matter pretty much out of his mind as he concentrated on
the problems of the conference. But in the following week came
news from Detroit that was more of a “bombshell” to him than was
President Roosevelt’s July 3 rebuke to the gold-bloc nations of the
conference.
This concerned some fantastically irresponsible testimony. For
H. R. Wilkin, a vice-president of the Guardian National Bank, later
convicted of fraud in connection with operations of one of the
group units, had implied that Mrs. Couzens had made a “smart
money” withdrawal from the Union Guardian Trust Company just
before the bank holiday.
Illustrating the careless manner in which the grand jury in
vestigation was conducted, Wilkin had injected Mrs. Couzens’ name
into the hearing knowing, as his testimony itself shows, that his


THE SMEAR 277
assertions were based on hearsay, a knowledge that also was shared
by everyone else concerned.
Wilkin was being questioned at the time by Harry S. Toy, then
Wayne County prosecutor. Toy had asked Wilkin to comment on
reports that certain large withdrawals had been made from the
Union Guardian Trust Company prior to the holiday. Wilkin
mentioned that a bank in Houston, Texas, the bailiwick of Jesse
Jones, the RFC board member, had withdrawn about $165,000
between February 8 and 11. Then:
Q—Were there any other large withdrawals made prior to the
holiday?
A—Not to my knowledge.
Q—What do you mean to your knowledge? Did someone tell you
about them?
A—Yes. One of the officers of the bank told me Mrs. Couzens had
withdrawn nearly all her balance the Saturday before the
holiday.
Q—How much did she withdraw?
A—I don't know.
Q—Did you ever try to find out?
A—Yes, I saw the ledger card and it showed a pretty scant balance.
Later I tried to find out from the receiver of the bank, (B. C.)
Schram, and he told me he could not divulge the amount of
the withdrawal without permission of the comptroller of cur
rency.
Q—You say this withdrawal was made the Saturday before the
holiday?
A—Yes.
Q—When was this withdrawal cleared through the Detroit Clear
ing House?
A—The clearing house cleared approximately $4,000,000 on the
fifteenth. . . .
Q—Would the check of the average depositor have been cleared
the same as the check of Mrs. Couzens?
A—Yes, I think so. 6
That was all there was to this line of testimony. But it was enough
to inspire headlines and stories all over the world which, if they did
not say so directly, gave the impression that Mrs. Couzens had made
a “smart money” withdrawal of a really substantial amount.
The facts? Mrs. Couzens had made a withdrawal from a personal
account in the Union Guardian Trust Company. It was for approxi
mately $5,000, which she requested transferred around February
6 to the Riggs National Bank in Washington, to be used by her for
customary contributions to charities in which she was interested. 7


THE INDEPENDENT MAN
278
Obviously this was not a “smart money” withdrawal, nor was it
important in any respect to the fate of the trust company.
However, as a result of the way the Wilkin testimony was pre
sented, Couzens, in London, experienced the jolt of his life when he
saw on the front page of the Paris edition of the New York Herald
the headline:
SENATOR’S WIFE BLAMED
FOR WRECKING MICHIGAN BANKS
BY SMART MONEY WITHDRAWALS
4
He turned red—and he saw red. Ever afterward, he could never
recall this incident without feeling anger. “I was stabbed in the back,
and my dear wife’s name was dragged into this mess. I’ll never rest
until I get even with them,” he was later quoted as saying. 5 * * 8 Whether
or not he used precisely those words, this was certainly how he felt.
In this mood he returned to the United States, an angry man, de
termined to go before the Keidan grand jury and at last tell all he
knew about the bank crash.
There was no longer any reason anyway, he concluded, to hold
back the facts. He needed certain documents to back up what he had
learned—reports and letters in the possession of the Comptroller of
the Currency. So, before going to Detroit, he made it a point to call
on President Roosevelt to report personally on the London con
ference, and obtained from the President permission to have access
to the Comptroller’s records of the Detroit banks, including copies
of confidential reports filed by various bank examiners. 9
5
Couzens appeared as a witness before Judge Keidan on August
17, 1933. Up to then, the investigation had proved worthless as a
fact-finding process. Even State Attorney General Patrick O’Brien,
who had initiated the inquiry, had become disgusted. “We are
getting nothing but speeches,” he said. However, after Couzens had
been on the stand for two days, the Attorney General changed his
mind. “I am satisfied to go on,” he said. “Now we are getting facts.” 10
The kind of material that Couzens now presented was illustrated
by a report drawn up in May 1931 by the examining committee of
the Guardian National Bank of Commerce. This report, written by
officers of the bank itself, said:


THE SMEAR
279
The committee finds in the list of bad loans many loans that ob
viously have no other purpose than speculation on the stock market.
The makers of these loans had only limited earnings and no pros
pects of the payment of the loan otherwise than the rise in stock
prices. They were made to clerks, stenographers, bank officers, and
bank clerks, salesmen and others whose incomes were not sufficient
to warrant any substantial credit. . . .
The committee also finds in the list of bad loans, loans to officers
in other banks which were clearly made to assist or further stock
market operations. . . .
We find on the list of loans a substantial number of individuals
who have been recommended by directors of the banks for such
loans, loans to associates of directors in business, and loans to con
cerns in which the directors are interested or in which they were
officers. 11
If this document, and others of similar import, reflected fairly how
the Detroit banks were being operated, what remained of charges
that Couzens, Mrs. Couzens, or any other outsider—even the RFC,
let alone “radicals”—had wrecked the banks?
6
But no one connected with the grand jury was happy over this
kind of evidence. Prosecutor Toy, presumably intent upon getting
the facts, proceeded to badger Couzens. The Free Press under Bingay
carried articles to the effect that up to then the inquiry had been
proceeding properly, but Couzens, by “casting a spell,” because of
his position in public life, had changed the course of the inquiry into
undesirable paths. Editorials by Bingay in the Free Press chided
the prosecutor for being “awed” by Couzens. Prosecutor Toy should
break through the “spell” by getting tougher, the editorials said. 12
Toy obviously sought to comply. He subjected Couzens to a good
deal of harassment. However, it was plain that Couzens had trans
formed the hearing into a true fact-finding inquiry, not by any
“spell,” but through the force of facts.
Indeed, he furnished a classic example of the explosive nature of
Truth in a controversy, of how it shatters the most carefully con
structed alibis and melts through the layers of the most expertly
contrived makeups.
7
At times, his anger betrayed him into a too-sweeping indictment
of bankers in general. He included some individuals who apparently


28o
THE INDEPENDENT MAN
were blameless, notably certain directors of the First National Bank.
This left him open to some equally anger-inspired counterblasts,
such as one from James O. Murfin, a First National director, who
said: “I can shorten this testimony by saying every time Jim Couzens
mentioned my name, he lied!” 8 * * * * 13
Then, Longley returned to the stand to say “Couzens didn’t
know anything about the [Guardian] assets at the White House.
He didn’t know anything about them when he testified here. I
don’t think he knows anything about them now.” 14 The press
featured these blasts, and Couzens was placed on the defensive.
His recital of why the banks failed also suffered at times from dis
organized presentation of his material. This was not wholly his fault,
although his emotional tenseness tripped him up in this respect. To
reconstruct properly the whole story, months, even years, would be
needed. Moreover, all the facts—the minutes of the RFC for ex
ample—were not then open to him or anyone else. His presentation
suffered too, because he still chose to play down the part played in
the whole episode by the Fords. But these flaws and errors were really
matters of minor detail. The fact was, as a result of his appearance
in five sessions scattered through August and September, Detroit
really began to see for the first time what had happened to its
banks.
8
Yet, the effect of Couzens’ presentation was not at all what should
have been expected. Judge Keidan was strangely impatient with
Couzens. Concerning Couzens’ declarations that the banks were
undoubtedly insolvent, the judge demanded to know how this
could have been the case inasmuch as the federal government per
mitted the banks to continue to operate until the holiday.
Was it not the law that the Comptroller of the Currency must
close insolvent banks?
As the Comptroller did not act, was that not sufficient evidence
that the banks were in fact solvent?
Such questions had logic in them. But Couzens answered them
with some amazing evidence. He produced documents to show that
the Comptroller of the Currency, J. W. Pole, had adopted a policy
of extraordinary leniency with the nation’s banks. One such docu
ment read as follows:


THE SMEAR
28l
October 6, 1931
A. P. Leyburn,
Chief National Bank Examiner,
164 West Jackson Boulevard, Chicago, 111.
Please instruct all examiners to exercise extraordinary discretion in
their work and to use every effort to encourage and sustain the
morale in banks examined.
Leniency consistent with proper regard for public interest should be
extended. Present conditions demand sympathetic treatment on the
part of this office, and examiners can in important measure con
tribute to the alleviation of the difficult problems with which we
are temporarily faced.
J. W. Pole, Comptroller. 15
Couzens showed that later the Comptroller reiterated such in
structions for “leniency.” In the following December, all national
bank examiners were instructed by Pole that in cases of greatly
depreciated securities held by banks, the examiner “should discuss
the situation with the directors and urge recourse to methods by
which the bank may be strengthened, but should make no mandatory
demands' 916 In July 1932 the Comptroller had circularized all chief
national bank examiners with a communication that criticized
examiners for being too strict in their appraisals of securities. 17
Couzens quoted a statement made in the Senate on May 1, 1933,
by the “father of the federal reserve system,” Senator Glass:
For the last 12 or 14 years there has been no espionage on the
weak national banks. The comptroller of the currency admits that
if he had enforced the law he would have closed half the national
banks of the country. This means that the comptroller's office has not
done its duty. It has allowed banks to engage in irregular and illicit
practices. It has endangered the whole banking community. . . . 18
Judge Keidan wanted to know why the federal government
adopted such a policy. “On the theory,” Couzens answered, “that
prosperity was just around the corner. Public officials, from the
President down, were holding out that hope to the people.” 19
He then made a point that later drew a vigorous protest from
Hoover, who felt that it was a reflection upon his administration. 20
Couzens said:
“Your Honor must remember that there was a political campaign
on and that there was undoubtedly a disposition on the part of the


282
THE INDEPENDENT MAN
powers that be not to cause a bank collapse or bank difficulties
while a political campaign was on.” 21
9
Of course there was another side to this picture. Strict enforcement
of the banking laws would have hastened the closing of many more
banks than were closed, and nobody could be sure that this was
correct national policy. But Couzens’ purpose was not to question
the policy, rather to show what the banking situation had been.
In this, he not only received little cooperation from the judge,
but more antagonism from County Prosecutor Toy. His statement
that the political campaign influenced officials to be soft toward
actually insolvent banks was hooted at, though he had merely
anticipated the verdict of a well-known banking student, Professor
Westerfield of Yale, who later wrote: “Most of the banks had
portfolios choked with immobile and worthless loans and invest
ments; banking supervisors had been restrained for political and
other reasons from exacting obedience to bank law and had ceased
to require banks to write off losses.” 22
A good deal of the material that Couzens presented was from so-
called “yellow sheets.” These were letters that bank examiners had
sent to Washington as supplements to their regular reports. They
were confidential letters, designed only for the eyes of the Comp
troller—letters in which the examiners told exactly what they
thought about the banks they had examined, in which they set
down comments which, for reasons of policy, were not included in
the regular reports.
Because of their nature, these “yellow sheets” often were more
revealing than the official “white sheets,” and especially so during
the period of Pole's “leniency.”
But because they were not “official,” Prosecutor Toy, backed up
by Judge Keidan, proceeded to develop the theory that they were
unreliable. The prosecutor scoffed at them. Who had ever heard of
the “yellow sheets,” he asked, in effect. Why, no one had! This
was precisely the point about them—that they were confidential.
But to the prosecutor that vital point was enough to damn them as
evidence.
Couzens asked that the bankers be recalled to the stand. They
were. It was soon obvious that they were summoned not to be ques
tioned on the records and the transactions he had mentioned, but


THE SMEAR
283
to give them an opportunity to heap denunciation upon him. This
they did in full measure. Indeed, the proceedings then became, rather
than an investigation of the banks, a forum from which witness
after witness assailed Couzens.
Even former Governor Groesbeck, Couzens' original sponsor for
the Senate, now receiver for the Guardian Union Detroit Company,
joined in the attack. So also did aging Judge Connolly, whom
Couzens had defeated for mayor back in 1919, now receiver for the
Detroit Bankers Company. 23 Once again, almost all that was heard
in Judge Keidan’s court was the refrain: “Couzens wrecked the
banks!"
JO
There was much cruelty in the way he was attacked, both in and
out of the courtroom. Frederic L. Smith, who had become an admirer
of Couzens since the days back in 1903 when Couzens had defied
Smith's Selden patent association, wrote him that the easiest way
to start a row in the Detroit Club to which both belonged, was
for someone to make a remark in his defense. “I tried this," said
Smith, “and ran the risk of being thrown out." 24
How this group of Detroiters felt about him was made clear
to Couzens in an experience of his own. On his going to his
accustomed table for lunch at the Detroit Club, several of the men
who had shared that table with him for years stiffly rose and carried
their plates to another location. 25 Ever since he had joined the club
many of the members had tolerated his general criticisms of the
economic system by which they had become the industrial and
financial leaders of Detroit. But now that he had become specific,
and worse, had declared open war upon the most respected leaders
of the city, the bankers and bank directors, they felt that he had put
himself beyond the pale of polite society. Even for a “scab million
aire," he had gone too far, they decided.
This bitterness toward him was more intense than any he had
generated during his entire previous career, greater than that caused
by his fight for M.O., his attack on the Mellon tax plan, or his opposi
tion to Warren for Attorney General. Not since the 1890's, when
Mayor Hazen S. Pingree was expelled from his clubs and his church
for advocating the reforms in municipal politics that Couzens was to
carry out, had Detroit seen anything like it.
The whole atmosphere was distinctly that of a pack, snapping and


284
THE INDEPENDENT MAN
snarling. The furor surpassed even the anger he had aroused back
in 1914, when he had denounced the Board of Commerce members ,
labor policies, the incident that had evoked a description of him
in the Detroit Journal as a “commercial Savonarola.” This news
paper, now long out of existence, had said: “Society has an unpleasant
way of crucifying those who tell it the truth one generation too
soon. And woe to Couzens for his truth indulgences were he less
strong in this community! For banks can crush and capital can os
tracize.” 26
In the hot summer of 1933, those passages in the editorial
printed in the long-ago winter of 1914 must have seemed highly
prophetic to Couzens. He probably remembered them, for during
the height of the storming, he once wryly remarked, ‘Til be lucky
not to be hanged in person, not merely in effigy.” 27
11
But Couzens was neither crushed nor silenced. Because he had not
been able to present before Judge Keidan all of his material gleaned
from the government documents and, concluding from the judge’s
attitude that he would not be permitted to do so, he attempted to
proceed through direct action. He invited Prosecutor Toy and
members of the prosecuting staff to come to his office in Birmingham.
There he laid before them a mass of records, with the hope that they
would make use of the material on their own. The prosecutors were
strangely unprosecutorlike. They did nothing. Couzens then offered
the material directly to the newspapers. The newspapers were de
cidedly cautious, perhaps for good reasons, in their view.
Indeed, almost the only result of this move was that, on Septem
ber 14, he became involved in a furious argument with Malcolm
Bingay when that journalist, instead of welcoming the material,
proceeded to upbraid Couzens for “keeping up this endless argument
and flinging of personalities.” 28
There was still Judge Keidan’s court. It was only right that
Couzens should have the opportunity to testify there again, es
pecially in view of the assaults made upon him. So he made ready to
present new material to the grand-jury investigation. Day and night,
“and Sundays included,” in his office in the Wabeek Building in
Birmingham, he labored over the reports and figures. On September
15 he wrote to Judge Keidan that he had “considerable new evidence
concerning the Guardian Detroit Union Group” and asked the


THE SMEAR
285
judge to advise him when he might be permitted to testify again. 29
Before his letter could reach the judge, Couzens heard incredible
news—Judge Keidan planned to adjourn the inquiry immediately,
without hearing him. He promptly telephoned the judge, who
agreed to meet him the following morning at Frank Couzens' home.
“Judge Keidan . . . argued against my again appearing on the
witness stand for the reason that I might introduce new evidence,
which would cause the bankers to again request a chance to be
heard and further delay the conclusion of the grand jury," Couzens
later related. Finally the judge grudgingly consented to let him
testify once more, on a condition: Couzens was to confine himself to
answering the attacks made on him. Under no circumstances, said
the judge, was he to bring up anything new. 30
With respect to influencing the findings of Judge Keidan, Couzens
might well have saved himself that final three-hour exertion at the
grand jury session. For as soon as Couzens finished, the judge ruled
that the inquiry was over, and at once produced a previously pre
pared document setting forth his findings. This gave the bankers
and the banks a clean bill of health.
12
Judge Keidan had enjoyed the reputation of being one of the most
judicial of judges on the bench in Detroit and an honorable man.
Couzens had esteemed him, at one time considered recommending
him for a place in the federal judiciary. No breath of scandal or of
venality of any kind had ever touched him. But it was clear from
his conduct throughout the grand jury, and especially from his
statement of findings, that Judge Keidan, for whatever reason, had
no stomach for exposing any wrongdoing on the part of the bankers.
He, at least, was no Savonarola.
The judge revealed clearly in his statement that his major con
cern was to have the grand jury create public pressure which would
cause the federal government to come through quickly with money
for paying off the depositors. He wrote: “In the final analysis, the
public is interested in this help. Criminations and recriminations
are futile." 31
In short, Judge Keidan's view was to let sleeping dogs lie. The
thing to do was to thaw out the frozen assets. He wanted no part of
Couzens' program of getting the causes of the banking crisis pre
sented to the public.


s86
THE INDEPENDENT MAN
*3
Couzens then took to the speaking platform. At a meeting of
depositors at the Northwestern High School Auditorium in Detroit,
he gave a fiery two-hour speech. “I am satisfied,” he told this audi
ence, “that a determined effort to get at all the transactions of the
bank holding companies and their subsidiaries will convict some
body of a crime.” 32 He was angry; no doubt about that.
However, he soon decided that such meetings would really get
him nowhere. Obviously speeches were no weapons in the war that
quickly opened up between him and Bingay of the Free Press, which
then—this was before the Free Press came under a new and more
objective management, that of the Knight Newspapers—was openly
feuding with him. That he was at a disadvantage in this feud was
brought home to Couzens when that newspaper devoted nearly
three columns of its front page to an article which carried these
headlines:
COUZENS ADMITS REVENGE
SPURS HIM ON IN ATTACK
UPON BANKS OF DETROIT
Says He Is Moved
By Personal Hate
Feels Safe Because
of Wealth and Office 33
*4
Malcolm Bingay had written the article on the basis of the argu
ment that they had engaged in on September 14. It was printed, said
the Free Press, because “the strange attitude of Senator Couzens
requires explanation”; because “it is necessary now for the people
of Detroit and Michigan who have for so many years honored
James Couzens to know his mental attitude.” As summed up by
Bingay, there was nothing to Couzens’ efforts to bring out the facts
in the bank situation except hatred of the bankers and a desire for
revenge. Bingay shored up his thesis by quoting utterances by
Couzens made in the heat of their personal argument in Couzens’
office in Birmingham.
After the heat of the bank controversy died down, it was plain
what Bingay had done. He had goaded Couzens into a personal


THE SMEAR 287
argument, knowing how easily Couzens lost his temper, and then
had printed the result as if it were an “interview.”
True, Couzens had asked for this treatment. He had flown off the
handle with a newspaperman. His ingrained outspokenness and
anger had betrayed him into making remarks he obviously would
not have made had he believed he were being interviewed for
publication. A calmer man would never have let himself get into
such a position.
To friends, he pretended that he was not bothered by Bingay’s
article. Actually he was a good deal upset over it. 34 He promptly
called off any further speaking engagements on the bank situation.
He felt keenly that the public had been poisoned against him, that
most Detroiters really believed that he had been responsible for
wrecking the banks. He talked moodily with intimates about how
his reward for twenty years and more of public service was that he
had become an object of scorn. “I went through Hell,” he told Tom
Payne. 35
15
Actually, it had been a mistake, from any angle, for him to par
ticipate in the Keidan grand jury investigation. As a Senator, he had
at hand the most effective medium in the country for producing
facts—a Senate investigation.
As early as the previous March, various persons had suggested
that the Senate Committee on Banking and Currency, still probing
into the New York Exchange and other financial institutions, might
well turn its attention to the Detroit affair. In June, the City Council
of Detroit adopted a resolution asking that the Senate committee
“come to Detroit and conduct a thorough and public investiga
tion.” 36
As a member of that committee, Couzens was not then convinced
that the Detroit situation warranted a full-dress Senate inquiry,
especially as new banking legislation already had been adopted,
presumably for making impossible a repetition of the Detroit bank
organizational defects. 37
However, after the Keidan investigation fiasco, he changed his
mind. Besides, his spirits were now considerably elevated, in con
sequence of a special mayoral election held in Detroit at just this
time that resulted in Frank Couzens’ being elected mayor by a
handsome majority.


288
THE INDEPENDENT MAN
“I guess that shows that I haven't ruined the family reputation
after all!” Couzens exclaimed.
He was ready to fight again.
When he returned to Washington on October 1, he discussed
with Pecora, still counsel to the Senate Banking and Currency
Committee, the possibilities of a fruitful inquiry by that committee
into the Detroit banking mess. 38 Soon after, the full committee, of
which Senator Duncan U. Fletcher of Florida was chairman, voted
to conduct such an inquiry.
This Senate investigation of the Detroit banks, which began in
Washington on December 19, 1933, was decidedly different from
the Keidan grand jury investigation. It laid bare in minutest detail
the full story of the Michigan bank holiday, its causes and its after
math. Almost everyone who had anything to do with the banks and
the holiday was called to testify and subjected to searching examina
tion by the expert cross-examiner, Pecora. Edsel Ford was called,
though not Henry Ford, and from Edsel the role of the Fords was
brought out clearly.
There were no “speeches" at this investigation, and no hearsay.
Only facts. The facts filled 1,647 closely printed pages in the four
volumes published by the Senate. 39
A study of those volumes leaves no doubt as to where the fault
lay for the holiday, nor for the conditions which led up to it.
The bankers themselves had wrecked their banks, albeit, the final
Senate report in words approved by Couzens, rather obliquely put
it: “Nor can the failure of these companies be attributed solely
to the constituency, competency, or honesty of the persons control
ling these institutions. 40
True, some of the truly shocking actions laid bare had been
forced on them by the depression and represented desperate efforts
to prevent the crash. But careful and honest banking, rather than
recklessness and speculation and worse, obviously would have
avoided the full extent of the crash. Moreover, it was unquestionably
established that Couzens had nothing to do with the refusal of the
RFC assistance asked for in the beginning, nor even with the scaling
down of the ultimate loan granted.
If any one person had forced the bank holiday, this person was,
not Couzens, but Henry Ford.
All this was placed on the record. 41 That record constitutes more
than a defense of the accusations against Couzens; it is a detailed


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289
description of the Michigan banking “magic” which turned out to
be, not magic, but financial buccaneering on a scale beyond ordinary
comprehension.
Studied efforts were made to discredit this Senate investigation.
It was dubbed solely a “Couzens affair.” 42 The truth was precisely
the opposite, as even a cursory examination of the record shows.
But angry men will say many things; Couzens did, and so did those
who opposed him for one reason or another.
16
The Senate investigation came to an end exactly on the anniver
sary of the White House conference on the bank crisis. “We con
cluded our Detroit bank hearings at five o’clock tonight, and, I
feel, with a blaze of glory, because today’s testimony was quite
corroborative of my position,” Couzens wrote to Tom Payne. 43
He did not exaggerate. On that day the committee had heard Bal-
lantine, Leyburn, and Await. Their combined testimony underlined
emphatically what was plain to anyone who bothered to follow the
hearing—that the bankers themselves, by the type of banking they
had developed, had been at fault. There could be no doubt of that.
Frederic L. Smith, who, like Couzens, had lived through the panics
of 1893, 1907, and 1921-1922, and had observed such Congressional
investigations as the Pujo inquiry into the “money trust,” wrote to
Couzens: “Your investigations have been more truly constructive,
timely, and, I believe, ultimately ‘curative’ than those of any govern
ment-run investigations since I began to take notice. . . . They have
opened the eyes of the man on the street.”
Couzens answered that, while he was “distressed” over the disclo
sures as to how the banks were operated, he was satisfied “they had
to be made in the public interest. . . . What I wanted was for the
Senate and the country to know.” 44 This he had accomplished.
He had shown, among other things, that so far from having been
“responsible” for the closing of the Detroit banks, he had tried to
do more than almost anyone else to keep them open, having gone to
the length of offering a good slice of his personal fortune to save the
situation, even though he had no stock in any of the banks and very
little other personal financial interest. He had shown, too, that his
objections to an “immoral” RFC loan were not at all a factor in the
crisis—that no one else in the government approved the original loan
requested after the facts were known. His statement about “shouting


290
THE INDEPENDENT MAN
from the rooftops"' was not at all a “cause" of the crisis. It had been
torn out of context and used to misrepresent his position, also to
make of him the scapegoat for the crisis brought about by others.
He had shown that the Detroit crisis was not something that had
developed suddenly, but was long in the making, in large part be
cause of “general conditions" and some unwise mergers, and also be
cause of unsound and in some cases immoral as well as illegal banking
practices. He had established also that whereas the Fords were in
volved in the crisis, his own relationship with the Fords, friendlier
then than at other periods, was not a factor. Above all, he had shown
that had the bankers as a class followed the safe, sane, and strictly
ethical principles which he himself, when a banker, had epitomized,
the situation might not have developed, certainly not so critically.
Having established a record showing all this, he had good reason to
be satisfied with the verdict of history.
*7
On August 1, 1934, largely in consequence of the revelations at the
Senate investigation, the Department of Justice obtained federal grand
jury indictments against twenty-eight of the leading bankers in both
groups on charges of technical violations of the federal banking
laws. 45 Complicated cases brought some complicated results. In 1935
three bankers in the First National group were acquitted. But in
1936 three others of the same group were found guilty and fined,
though the verdict in the case of one was later set aside. In 1937 all
of the cases were dismissed after still another trio entered pleas of
nolo contendere and were fined $1,000 each. 46
One banker did get a prison sentence on criminal-count conviction
in a state court. This was Wilkin, the witness who had brought Mrs.
Couzens" name into the controversy before Judge Keidan. He was
held responsible for “window-dressing" of the Union Industrial Bank
of Flint, a unit of the Guardian Group. 47
As for Couzens, after the Senate investigation was over, he was
content to let the bank matter pass into history. His principal interest
after this was in the further unfolding of Roosevelt’s New Deal.
And to this he devoted himself with much of his old-time zeal.


291
CHAPTER X L 11
THE NEW DEAL REPUBLICAN
By then, in 1934, Roosevelt’s honeymoon was over. As the banks
stayed open and business indices rose, as everyone began to feel bet
ter about the state of the nation, the earlier fear disappeared. Then
many stand-patters turned on the new President and there occurred,
with Couzens playing a part, increasingly bitter debate over the poli
cies of the new administration.
In August 1934, on the occasion of his sixty-second birthday, Couz
ens was interviewed by the North American Newspaper Alliance.
He took the occasion to rebuke those who, without offering an alter
native, criticized the New Deal, saying: “This is not the time for
mere words. The country is in the fifth year of depression, and action,
rather than words, is needed.” 1
In the following November, he told the Detroit Optimist Club:
The thing to do is for everyone to show a continued faith in
President Roosevelt’s policies. . . . There is no light in the future
of America unless we get away from the idea of “rugged individual
ism” which means, I believe, that a few can become wealthy at the
expense of the many. . . . 2
No one was more disgusted than he with the propaganda line of
New Deal opponents which pictured certain Roosevelt advisers,
notably Professor Rexford G. Tugwell, then of Columbia University,
later of the University of Chicago, as “communists” bent on under
mining the nation. 3 He told Madeleine: “Most of these yarns about
communism, dictatorship, etc. are smoke screens, or evidence of
fear that someone’s money may be lost.” 4 When one of his con
stituents in Detroit wrote him to urge that he try to get rid of
Tugwell before America was “sovietized,” Couzens answered:
“I am unwilling to sit by and see millions of our people in distress
because they are unable to secure work, and if that is what Professor
Tugwell is driving at, then I am for it.” 5


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THE INDEPENDENT MAN
2
By no means, however, was he always on Roosevelt’s side.
He was still Couzens, still the individualist who stubbornly hoed
his own row; still the natural critic. Hence, he often let loose blasts
at the Roosevelt administration as trenchant and resounding as any
set off by the “Stop Roosevelt” bloc then active. A case in point
occurred when Secretary Woodin, because of illness, resigned from
the Treasury, and Henry Morgenthau, Jr., was named his successor.
Couzens did not object to Morgenthau; rather, he approved. 6 But
he did object to Morgenthau’s plan to retain in the Treasury depart
ment as a principal assistant Earl Baillie, member of J. & W. Seligman
& Company. In Couzens’ view, this was “another Acheson type of
appointment.” Baillie’s banking firm was one of those involved in
the foreign-loan scandals unearthed by the Senate Finance Com
mittee. Indeed, it was the very firm that had floated the discredited
Peruvian loan of unpleasant memory. Couzens let it be known that
unless Baillie went, he would conduct a fight against the confirma
tion of Morgenthau. He “laid down the law,” and Baillie resigned. 7
3
Certain New Deal projects went wholly against Couzens’ grain.
The public housing program was one. As did the remaining stalwart
Republicans and conservative Democrats, including a new and in
conspicuous senator from Missouri, Harry S. Truman, he voted
against the bill establishing the United States Housing Authority. 8
His general opposition to public housing was that it represented a
subsidy to employers. “I never quite understood the theory of some
people,” he wrote, “that the taxpayers should supply houses for
certain low income wage workers to enable private employers to
get these workers at low wages.” 9 His attitude seemed an about-face
from his own stand as Mayor of Detroit, when he proposed a munici
pal bond issue to build homes because of the wartime housing short
age. But he viewed his proposal as different from the New Deal pro
gram of raising the standards of homes that existed.
As in the days when he suggested the five-dollar-a-day plan at the
Ford Company, he held to the view that it was up to the industry
to pay wages high enough so that workers could arrange for their own
housing. Or, he maintained, let employers pay the whole bill in
higher corporation taxes, rather than assess the cost to the general
taxpayer. 10
One phase of New Deal housing, the subsistence homestead proj-


THE NEW DEAL REPUBLICAN
293
ects, had his sympathy for these represented fruition of an idea
that he and Ford had toyed with back in the days of the five-dollar
plan. The concept was that factory workers would also be small
farmers. Couzens was glad to see the New Deal experiment in that
direction. But here he felt that the approach was wrong, in that the
first such projects were located in areas that lacked factories, notably
the so-called Red House project in West Virginia.
With Roosevelt, and also with Harry Hopkins, relief administrator,
Couzens carried on an extended argument over this. It was foolish,
he told them, 4 4 to go out in a field and build some houses under the
assumption that eventually some industry would come in. . . . He
felt that it was far more sensible to build the houses somewhere
adjacent to where industries already were established.'* The New
Dealers, he said, were “cockeyed” in their approach. 11
Curiously enough, as a result of this discussion, he found himself
sponsoring a housing project, even though he was opposed to the
general idea.
“How much did the Red House project cost?” he asked Hopkins.
Hopkins guessed that the cost was $550,000.
“All right,” said Couzens. “I’ll put up $550,000 for a project to
show that I am right. But if the Red House project cost more, and
I think it did, you put up the balance.” 12
The Red House project cost $850,000. So the arrangement was
made for Couzens to donate $550,000 to the State of Michigan, to
which the federal government added $300,000, and there was born
the non-profit “Oakland Housing, Inc.,” for building West Acres,
a community of 150 six-room homes located on a 1,000-acre tract
nine miles west of Pontiac, in close proximity to the automobile
industry. 13 There, low-income families who were subject to the
seasonal unemployment then characteristic of the automobile in
dustry, were permitted to acquire on easy terms homes on sufficient
land to enable them to fill in their income through raising garden
products.
But he was sorry that he had made this housing gift almost as
soon as he had made it. His doubts about it were clearly revealed in
the announcement that was made to the public.
This project is not economically sound if there is any fundamental
soundness in our capitalistic system. It is merely a bridge. . . . Our
fundamental job is to readjust national income, wages, and work
ing conditions so as to provide more of these men with a living
income. . . . 14


294
THE INDEPENDENT MAN
4
This ambivalence, well-founded, regarding West Acres really re
flected his basic attitude toward the way the New Deal was being
administered. Roosevelt himself admitted that he often considered
himself “a quarterback” who followed one line and then another,
depending on how the game was going. 5 * * * * * * * * * 15 Couzens noted this, was
disturbed, and complained. He frankly told Roosevelt that good
laws were being ruined by “abominable administration.” In one
such talk with Roosevelt he said, “Do you know what’s wrong with
your administration? You haven’t anyone in it who ever earned a
dollar. That’s what’s wrong!” 16
To Dr. Freund he wrote: “While I have a very definite conviction
that where the President wants to go is right, I am not always sure
that he is on the right road and neither can anyone else be.” 17
In the following spring he complained to a friend in London:
“Things are in a terrible turmoil, and I haven’t the slightest idea
where the New Deal is going. . . .” 18
Yet it was always apparent that his criticisms of the New Deal
were those of a friend who wanted a new program to succeed. Often
the fault he found with the New Deal was that it was not liberal
enough.
5
In April 1934 he drew upon himself much of the abuse generally
reserved for Roosevelt, when he initiated an amendment to an
appropriation bill for increasing surtaxes on large incomes by a
flat 10 per cent as the most equitable way to pay the cost of unem
ployment relief.
It was his old fight on Mellonism over again.
In San Simeon, California, Publisher Hearst was enraged by
Couzens’ tax plan. The Hearst papers soon campaigned against it
in 120-point type. Hearst was especially bitter, it appeared, because
Hiram Johnson had endorsed Couzens’ amendment, thus, for once
in this period, taking a non-Hearstian stand.
“Hearst called his editors in a violent wrath in the dead of night
and ordered them to crucify Johnson and Couzens with him. . . .
Hearst screamed: ‘That man Couzens has all the money he wants
and now he’s trying to feather his political nest by appearing to help
the people. We’ll have to throw Couzens out. His money has turned
Johnson’s head!’ ” So one Hearst editor recalled. 19


THE NEW DEAL REPUBLICAN
295
B. C. Forbes, in earlier years author of several articles friendly
toward Couzens, sent nationwide a bitter attack on Couzens. “The
foremost ‘Soak the Rich’ advocate in America is a rich man, a very
rich man, a multi-millionaire,” wrote Forbes. “This extremely
wealthy soaker of the rich has placed himself largely beyond the
reach of the kind of soaking he vehemently urges for others, for
his fortune is in tax-exempt bonds.” Not patriotism but demagoguery
motivated Couzens, Forbes said. 20
In the Senate, although not in the House, Couzens obtained
passage of his proposal. 21 Then he delivered an attack on Hearst,
referring to him scornfully as a “yellow journalist.” 22 Hearst stood
for “soaking the poor,” he said. He sarcastically noted that Hearst
had finally changed his slogan against his plan from “Soaking the
Rich” to “Soaking the Thrifty” because “somebody must have tipped
him off to the absurdity of the ‘soak the rich’ slogan, as there isn’t
anybody else to soak.” He reminded the Senate that Hearst was the
foremost supporter of a general sales tax. “I compliment the Ameri
can Congress,” he said, “for never having fallen for the stupid and
unscrupulous general sales tax, in spite of the years and years of
propaganda for it by Mr. Hearst.” 23
His main purpose in answering the Hearst attacks, he said, was
to comment on a more important and dangerous propaganda line
then prominent in Hearst editorials. This was that England, then
under a Tory government, had staged a greater recovery from the
depression than had the United States, by balancing her budget
and planning to lower taxes. If England had indeed balanced her
budget, went on Couzens, she had done so by postponing payment
of her debt to the United States.
“We could balance our budget and reduce our income taxes if
we repudiated all of the money we borrowed from our citizens to
loan to Great Britain and other countries.” 24
Not long after that he again rubbed persons of wealth the wrong
way when, as in the Mellon days, he plumped for publicity on in
come tax payments, holding that “secrecy . . . breeds favoritism,
corruption, dishonesty, graft and maladministration.” As he wrote
to an editor of the Detroit News: “If the income tax returns had
been matters of public record, Congress long ago would have dis
covered the means of evasion adopted by the Morgans, Mitchells,
and others to avoid all taxation for the years 1930 and on. . . .” 25


THE INDEPENDENT MAN
296
He conceded that one argument against the publicity proposal was
valid: gossip would be encouraged. But, he declared, “there are many
things in a democratic society which have to be done to maintain
our country.” 26
In this battle, one that stirred up a great heat, much abuse was
directed at Couzens. Bingay devoted a column to the old charge that
Couzens wanted to embarrass other rich men, whereas “Jim has
$60,000,000 in tax exempt bonds.” 27 A few weeks later, the Chicago
Tribune published a long magazine-section article under the head
ings:
‘SWAT THE RICH' IS COUZENS’ CRY
$30,000,000 SENATOR HAS TAX-FREE FORTUNE 28
However, the real complaint against Couzens by staunch Re
publican organs was more fundamental than mere outrage over
his views on taxation. He was now looked upon, with Norris, young
La Follette, and Hiram Johnson, as a real threat to the continued
existence of the Republican party. His evident friendliness toward
the New Deal was interpreted as playing into the hands of a Roose-
veltian scheme to bring about a new political alignment in the
United States, by which the old parties would give way to a Liberal
and a Conservative party. The inclusion in Roosevelt’s cabinet of
two Republicans, Henry A. Wallace and Harold L. Ickes, was seen
as one step in this direction. Another would be the winning per
manently of the allegiance of the old Republican insurgents.
So Couzens was now anathematized in the conservative Re
publican papers as a “New Deal Republican” or, worse, a “Roose
velt New Dealer,” who had turned traitor to his own party and
class. “Party wheelhorses are taking the position that anything that
could be done to discredit Couzens would be to the Republican
advantage,” Jay Hayden wrote. 29
7
But Couzens did not at all resent the New Deal label. More than
ever, he was convinced that not just recovery, but a new deal in
fact, was needed in America. It would be stupid, he felt, to go back
to the old order, and thus merely assure a repetition of the Great
Depression. Until a better new deal was produced, he would sup
port Roosevelt’s, regardless of partisan considerations.
Temperamentally, this decision meant disciplining his trait of


THE NEW DEAL REPUBLICAN
297
independence. It would have been easier on his emotions to let this
trait now take him along the path followed, for example, by Senator
Borah. For by 1935 Borah, once denounced as a dangerous radical,
had become, strangely, a hero of the conservative Republicans. He
had decided that the whole New Deal was “unconstitutional,” its
tax program, in particular, a “spread the poverty” scheme that would
lead to “dictatorship.” 30 In effect, Borah had committed insurgency
against himself. With him on his circuitous route, Borah took along
an oldtime admirer, Vandenberg. For a time Vandenberg had sur
prised Couzens, and, perhaps, even himself, by standing for certain
New Deal proposals and even going further than Roosevelt wished,
as in sponsorship of federal insurance of bank deposits. Now, like Bo
rah, Vandenberg was declaiming against the New Deal as a threat
to American institutions. His slogan was: “Roosevelt must be
stopped.” 31
To Couzens, Borah’s position was illogical—opposition to the
New Deal for mere opposition’s sake, something of which he himself
had been often accused. If Borah were motivated by a desire to pre
serve the old party labels—perhaps to get the Presidency in 1936—
Couzens was even less sympathetic. During the crisis, he was for
postponing all partisan activity. Thus in December 1934 he turned
down an invitation to participate in a conference of Republican
leaders, even when the meeting was ostensibly to be held for the
purpose of reorganizing the Republican party along liberal lines. 32
A few months later, he still held to this position even to the extent
of creating a new breach between himself and the Republican leader
ship in Michigan. Howard C. Lawrence, state chairman, had asked
him to send a message to the regular Republican state convention,
scheduled to be held in Lansing in March 1935. A mere greeting
would have served. Couzens declined even this. He bluntly in
formed the state chairman that he did not believe a political con
vention should be held at that time, in view of the critical problems
which the nation faced. It was “inopportune” to discuss “partisan
politics” in such a crisis, he said. 33 Of course, the party leaders were
offended, retaliating at the convention by passing a resolution
praising Senator Vandenberg but pointedly ignoring Couzens. It
was 1924 all over again. 34 It was also a forecast that if Couzens were
forced to choose between Republicanism and Roosevelt, Roosevelt
probably would win.


298
CHAPTER XLIII
THE UNBOWED HEAD
That spring Roosevelt sent to Congress a request for an emergency
public-works program to cost $4,800,000,000. It was a measure, one
which made possible not only big public works, but also the WPA
projects of “made work,” the National Youth Administration, and
other agencies to supply jobs for the unemployed, that sent the con
servative opposition into a kind of frenzy. Such an expenditure,
though only a fraction of the size of federal appropriations some of
them lived to see and even approve, would “wreck the nation,” they
declared.
Vandenberg, now often mentioned as a Republican candidate for
President in 1936, took this line, and delivered a lengthy oration in
the Senate on the theme that so vast a project must lead first to bank
ruptcy, then to a dictatorship.
Couzens naturally favored the public-works program. It had been
his own idea also. Yet he also took part in this furious debate as
critic, as well as defender, of Roosevelt. He agreed with Vandenberg
that the bill, as originally drafted, gave too much power to the
President in determining what projects were to be undertaken. 1
His most vigorous objection, however, was not at all a conservative
one. It was against a provision that workers on the projects were
to be paid a so-called “security wage,” averaging about fifty dollars
a month, or less than half of the prevailing rates. He told the Senate:
“The industry that supplies the lumber has no limitations on its
prices at all, but the most defenseless group of our citizens is told,
‘You will take what you are given and you will perform a day's work
for half what any other citizen gets for performing the same work.' ” 2
This, he insisted, was unjust and ought not to be tolerated by the
New Deal, not for economy reasons, not even to placate Southern
leaders, who feared high wage scales for Negroes. When an amend-


THE UNBOWED HEAD
m
merit was adopted which met Couzens' objections to the “security
wage," he quite happily voted for the bill. 3 He did not think much
of Vandenberg’s fears that a $4,800,000,000 outlay to put men to
work could “bankrupt America."
2
Up to then, Roosevelt's program in the main had concentrated
on relief and recovery. Now the New Deal moved more in the
direction of reform, with the Social Security Bill, the Wagner Labor
Relations Act, the Public Utility Holding Company Act, and the
first major New Deal tax program imposing higher income tax rates
as well as greatly increased levies on inheritances and gifts. 4 Couzens
favored all of these proposals, especially the tax program. 5 In a sense
this was his real victory at last in the battle he had waged for pro
gressive principles on taxation when Mellon was in office.
Even before this, it was obvious that he was almost always in
Roosevelt's camp when the chips were down, more so, in fact, than
many members of Roosevelt’s own party. He stood with Roosevelt
for adherence to the World Court, in face of an unprecedented bar
rage of letters in opposition generated by Father Coughlin and the
Hearst papers, thousands of which descended upon him from
Michigan. 6
He likewise stood with Roosevelt against the Patman Bill for
immediate payment of the soldiers' bonus, which Roosevelt vetoed.
He was bitterly denounced as a “turncoat" by veterans’ groups for
that vote, for he had been a bonus advocate during the Coolidge and
Hoover regimes, and he had opposed Roosevelt’s veterans' cuts in
March 1933. But he now agreed with Roosevelt that, with all the
relief provided by the New Deal, the war veterans did not need
special treatment. 7
3
Two other measures with wide popular support, the Townsend
Old Age Plan, and the McLeod Bill for having the federal govern
ment make a payment of 50 per cent to all depositors in closed
banks, likewise found him standing with the administration, whereas
there were wide defections from Roosevelt within his own party on
these issues. For Couzens, like Roosevelt, opposed these popular
measures.
Even Borah, then the “constitutionalist," supported the McLeod


$00
THE INDEPENDENT MAN
Bill, which the Hearst press advocated. It was a popular measure,
especially in Couzens' home state, with all its closed banks.
Among thousands of others, Couzens’ own brother, Homer, urged
that he support it. ‘Tor the love of Mike,” begged Homer, “get be
hind the McLeod Bill ... so I can pay off on our new home.” 8
But Couzens told Homer what he wrote to others. The McLeod Bill
was “stupid.” For the government to pay off closed bank depositors out
of government funds perhaps looked like relief to the average citizen,
but actually meant pouring billions into the coffers of a few cor
porations and wealthy persons, who owned the bulk of bank deposits
in closed or open banks. He told the Senate that “anyone so lacking
in judgment as to endorse the so-called McLeod Bill is not entitled,
in my judgment, to vote on the floor of the Senate.” 9 In particular,
he meant Borah, now in his view a fallen idol of progressivism and
independence. 10
4
However, the big fight was on Roosevelt’s reform measures.
Against these the Republican Old Guard, conservative Democrats,
Borah, Vandenberg, the Hearst press, and a newly formed, sup
posedly nonpartisan, American Liberty League (of which Alfred E.
Smith, John W. Davis, and John J. Raskob were leaders) began
a tremendous campaign on the theme that the New Deal was intent
on tearing down “the American system.”
Of this American Liberty League, Couzens was scornful. It might
have been nonpartisan, he said in an interview, but this was only
true with regard to the formal political affiliations of the members.
The leaders were all rich men, Democratic as well as Republican,
so there was no question in his mind that they represented “the same
convictions.” The nonpartisan claim was “humorous” to him, he
said. 11
When the great debate opened, the tension heightened by Supreme
Court decisions that held invalid certain portions of the NRA and
the Agricultural Adjustment Act, Couzens prepared to participate
prominently.
In particular, he planned to defend the Roosevelt tax program
against the attacks on it by Hearst, Borah, and Vandenberg. 12 Roose
velt supporters were delighted with the prospect of his aid, for his
status as a multimillionaire defending the New Deal seemed in itself
a refutation of the charge that the New Deal was a “communistic


THE UNBOWED HEAD
301
plot.” This debate had only begun, when, just as had happened
to him in 1924, at the crisis of his Mellon fight, he had to leave the
arena because of a new siege of illness.
5
“I am tired. ... I am tired. . . .” For some months there had
appeared in his letters to friends and family this warning phrase.
In March 1935 he told Madeleine that his 'Very conflictual” mail
from constituents had become enormous, and that keeping up with
it was wearing on him. 13 His sister, Rosetta, suggested that he take
at least a year off. But he could not see himself doing that. “When I
am unoccupied, I have a great deal of mental distress,” he said. 14
So he continued to drive himself, although obviously suffering
from acute fatigue. He began to lose weight noticeably. He com
plained of a peculiar numbness. Dr. Freund came from Detroit to see
him, and arranged immediately for a medical conference with several
Washington doctors. The discovery was made that he was a victim
of diabetes. He was ordered to be hospitalized at once, not in Wash
ington, but at Harper Hospital in Detroit.
“What the Senator needs is a good long rest,” Dr. Freund said
in a public announcement. 15 Actually, Dr. Freund knew that his
patient needed that and a good deal more.
When he had been at Harper for ten days, there came worse
news. The old bladder condition had become acute again, 16 so
acute that it was decided to rush him to the Mayo Clinic at
Rochester, Minnesota. At Rochester he underwent two major opera
tions, and remained there for seventy-eight days.
6
For weeks he was a man in torture. The pain that he suffered was
monumental. Once he exclaimed to Dr. Freund, “I've given twelve
million dollars for the Children’s Fund. I’d give another twelve
million dollars if you could find a way to end pain!” 17
Yet by November 1935 he was well enough, he thought, to go
with Mrs. Couzens to Phoenix, Arizona. His stay there, at the beauti
ful Arizona Biltmore, did not turn out nearly so well as he had ex
pected. For one thing, on top of all else, he now developed sinus
trouble. Spells of pain returned. He suffered from a peculiar weak
ness which showed up in all his movements. On November 11, 1935,
he wrote to his friend, Senator McNary, in a shaky script:


302
THE INDEPENDENT MAN
“My legs seem to be in about as desperate a condition as the
Republican party; they wobble like Hell. This is the most unsatis
factory period I have ever had to go through.”
What added to his physical distress was the old protest against
inactivity. “Just sitting around” a hotel depressed him. In December,
he wrote to Madeleine, “I think I am about through with active
business and work.” 18 Soon, however, he began talking about cutting
short his stay at the winter resort to return to the Senate.
His doctors argued against this, but on December 15 he and Mrs.
Couzens were on a special train, Washington-bound. And when the
Seventy-fifth Congress convened, January 3, 1936, he was there,
applauding Roosevelt’s State of the Union message in which the
President, concerning the New Deal, declared: “I recommend to
the Congress that we advance; that we do not retreat.” 19
Just hearing Roosevelt again was a tonic for Couzens. He was glad
he had defied his doctors and returned to work. To his colleagues,
he insisted that he felt “just fine,” though he didn’t. But he stayed
on the job, wracked but unbowed by the massive pain that so often
attacked him. Jay Hayden once found him writhing on the desk of
his office in the Senate Office Building because of pain—because he
refused to call a doctor, which, in his view, would have been a sign of
giving up. 20


303
CHAPTER XLIV
THE POLITICAL DILEMMA
He was never to feel really “fine” again. The incisions were slow
in healing. He had to have injections of insulin. The attacks of
terrible pain recurred. He was disappointed and depressed over his
physical condition, he wrote to John C. Manning, nephew of Mrs.
Couzens. But for the most part, his mood was to rise above his
physical distress and carry on.
He certainly demonstrated very early in the new Congress that
he still had plenty of fight left in him. For he took the lead in oppos
ing, as did Roosevelt, a new soldiers’ bonus bill. When Roosevelt
vetoed the “new veterans grab,” as it was called, Couzens was among
only nineteen senators to vote to sustain the veto. 1
To Madeleine’s husband, William R. Yaw, of whom he had be
come very fond, he commented: “By this time you will have seen
how much in the minority I was when I voted against the payment
now of the adjusted compensation certificates for veterans. That vote
undoubtedly will lose me votes. However, I do not suppose I will
ever have the courage to quit and so it may be to my own interest
to be defeated. Whatever happens will satisfy me.” 2
2
Then, in February 1936, he conducted a vigorous one-man cam
paign against what seemed to him to be an especially flagrant abuse
of patronage power by the administration. His target was Walter
C. Cummings, a Des Moines and Chicago streetcar manufacturer,
who had been introduced into the administration as Assistant Secre
tary of the Treasury by Woodin.
Couzens pointed out to the Senate that Cummings received some
unusual patronage plums, unusual in salary and in number. Cum
mings was installed, through the RFC, as chairman of the huge Con-


3°4
THE INDEPENDENT MAN
tinental Illinois National Bank and Trust Company of Chicago, at
a salary of $75,000, as trustee of the Chicago, Milwaukee, St. Paul
and Pacific Railroad, at another salary of $15,000, and, also through
the RFC, as board member of a large insurance company, the Mary
land Casualty Company. Undoubtedly, Cummings was an exception
ally able man, and Couzens did not deny this, nor did he question
his integrity.
But what compounded the case, in Couzens’ view, was that
Cummings was then also the treasurer of the Democratic National
Committee. He denounced what he described as “the possibility of
interlocking directorates, political appointments, the tying in of
politics with business and the tying in of railroads with bankers,
and so on down the line,” all apparently personified in Cummings. 3
Not long after this, Cummings resigned as treasurer of the national
committee, though he still headed the big Chicago bank.
5
This episode, which, the Chicago Tribune said, “gave Democratic
party leaders the jitters,” 4 did not mean that he had by any means
deserted Roosevelt. It merely meant that, as before, he reserved the
right to criticize the Roosevelt administration, even while support
ing it. On this point, referring to the position Cummings was in,
to solicit, if he desired, campaign contributions from corporations
with which he did business in his various financial posts, Couzens
told the Senate:
“I happen to know that during the Republican administrations
. . . millions of dollars [in campaign funds] were collected from
parties who had income tax claims pending before the bureau of
internal revenue. So my complaint now is in no sense political or
partisan. It involves a question which I have vigorously fought here
for some thirteen or fourteen years, and I intend to continue to find
fault, regardless of what administration may be in power.” 5
4
As 1936 wore on, his affinity for the New Deal caused considerable
concern to certain of his political well-wishers. That was the year he
was up for re-election, if he wished to remain in the Senate. They
worried especially over the problem of how he could expect to win
a Republican nomination, in a Republican primary, if he stuck by
his New Dealism with no organization of his own.


THE POLITICAL DILEMMA
3°5
He had become quite friendly with George Averill, editor of The
Eccentric, the local newspaper in Birmingham, Michigan. Averill
sketched quite early to him a plan to solve his dilemma. He suggested
that Couzens adopt the view that while he supported the Roosevelt
program “in principle,” he had decided that the Republican party
could do a better job and therefore Roosevelt ought to be defeated
in 1936. If he adopted that position, said Averill, he could be re
elected easily. 6
Essentially, this was how Vandenberg had won his re-election in
1934. Couzens rejected such advice offhand. His record of supporting
Roosevelt, as well as Roosevelt’s principles, was made, and he could
not repudiate it. He would not “stultify” himself, he told John Man
ning. 7
5
The primary was the critical hurdle. In the general election itself,
he could expect, as before, the support of voters of all parties, in
cluding especially the followers of Roosevelt. Not so in the primary.
Roosevelt’s very popularity had set up an additional obstacle to
Couzens there. He saw this new situation clearly:
Until 1933 there was practically no Democratic party in Michigan
and so nearly everybody (in the primary) went in and asked for a
Republican ballot, and in that case my sledding was easy. Now,
however, they have a Democratic party in Michigan and all of the
Democrats and Roosevelt supporters will undoubtedly go in and
ask for a Democratic ballot. My name will not be on that ballot
and so I will not be able to get their vote. 8
This meant that, in the Republican primary, his candidacy more
than ever would be at the mercy of the organization politicians of
the Republican party.
There was not much doubt but that those elements, as before,
would be against him. Already they were lining up behind young
Wilbur J. Brucker, who had been governor and who in 1955 was to
be Secretary of the Army in the Eisenhower administration, as the
candidate in place of Couzens. At the state Republican convention
in March 1935, at which Couzens had been snubbed, Brucker, then
an Old Guard type of lawyer with a flair for oratory, was ostenta
tiously idolized along with Vandenberg. It was plain that Brucker
would be run against Couzens, with the support of the whole Re
publican organization of the state.


THE INDEPENDENT MAN
306
In 1924, Couzens had overcome with ease the opposition of the
organization Republicans. But 1936, obviously, would not be 1924.
As he himself said, “I am not under-rating the many enemies I
have accumulated during the past five years. When you frankly oppose
the payment of the soldiers’ bonus, the Townsend Old Age Pension
Plan and other crazy schemes (like the McLeod Bill), you obviously
collect a bunch of enemies, in addition to those I have accumulated
through the misrepresentation about the bank closing.” 9
6
Back in February 1935, former Mayor Frank Murphy, then Gov
ernor-General of the Philippines, later Governor of Michigan and
named by Roosevelt to the Supreme Court, had a conversation with
John Manning which pointed to an interesting solution of Couzens’
problem. Couzens should change parties, Murphy said, and seek the
Democratic nomination for senator.
Coming from Murphy, then emerging as the leading Democrat
of the state, this suggestion was by no means mere conversation, es
pecially as Murphy then was preparing to run for governor on the
Democratic ticket in 1936. If Couzens would agree to seek the Dem
ocratic nomination, said Murphy, the Democratic organization would
not put up a candidate against him.
“I know I can manage it,” Murphy told Manning. “Connolly and
some of the Old Guard Democrats would fume, but they are done;
their power is gone.” 10
Murphy told Manning that this idea came to him after a group of
wealthy Detroiters had approached him with the offer of backing him
for senator against Couzens. As related to Couzens by Manning:
“Three friends of Ed Stair actually met Murphy in Honolulu and
tried to sell him. . . . Murphy asked why they were approaching
him—a Democrat and fully as radical as you—instead of grooming
one of their conservative Republicans. . . . He considered it an . . .
illustration of the extent of their hatred for you, that in their despera
tion they would go to a man like him to run against you.” 11
Murphy declined the suggestion. “Senator Couzens stands for the
same things in government that I do. He is for the people. He is
head and shoulders above every other man in the Senate in integrity
and independence and unswerving devotion to the interests of the
great mass of people. We need men like him in our government. His
way should be made smooth rather than hampered.” 12


THE POLITICAL DILEMMA
3°7
Murphy later added to this: “They offered me a half million dol
lars for a campaign fund. They considered Couzens a traitor to his
class. They wanted to beat him, desperately.” 13
In Washington a few days after his talk with Manning, Murphy
called on Couzens himself and made the same suggestion to him
directly, that Couzens seek the Democratic nomination. 14 “Your
position in the Republican party is untenable,” he said. “You never
have voted with the Republicans. You belong in the Democratic
party. You can’t win as a Republican. You can win as a Democrat.” 15
Couzens protested on this occasion that he had “started as a Re
publican and wanted to stay a Republican.” 16 But he did not close
the door tight against Murphy’s suggestion. There was yet time to
decide, he said.
Could he do as Henry Ford had done in 1918, and run as both
Republican and Democrat? Hiram Johnson had done that in Cal
ifornia, and had run on a third-party ticket to boot.
He asked Senator Vandenberg to obtain a formal opinion from
Harry S. Toy, by then the Attorney General of Michigan, on this
point. Toy’s opinion was that it was legal to be a candidate on both
tickets, but that in the general election he would have to designate
himself as either a Democrat or Republican. This meant that if he
entered both primaries and won only in the Democratic primary, he
would have to call himself a Democrat. 17 He shied from that, and
postponed a definite decision.
7
In November 1935 still another overture from the Democrats was
made to Couzens. G. Hall Roosevelt of Detroit, brother of Mrs.
Franklin D. Roosevelt and a close political associate of Frank
Murphy, called on Frank Couzens. He told Frank that the Dem
ocratic party in the state “might” endorse Senator Couzens for re
election, but wanted to be certain beforehand that the Senator would
not “slap back at them.” 18 He asked Frank to sound out his father in
secret. Couzens’ response to Frank was:
“I think I told you that numerous prominent Democrats had
talked to me along the same lines . . . but on each occasion I was
silent or at least noncommittal. I would not, under any circumstances,
make any private arrangements with anybody. Whatever I do with
respect to my campaign, will be done publicly.” 19
But what would he do? He did not know.


go8
THE INDEPENDENT MAN
8
Apparently with the idea of coaxing him to accept the Democratic
overtures, certain Democrats began feeding newspaper writers “in
side information” that he would run as a Democrat. Among other
publications, the Free Press said that there had been a deal: Post
master Farley was backing Couzens. In the Review of Reviews, there
appeared an item that said:
The real political fight looming in Michigan will be an effort
by the now thoroughly entrenched Republicans to oust Senator
Couzens as an independent Republican New Dealer. The violent-
tempered multimillionaire is Farley's only hope in Michigan. 9 * * * * * * * * * * 20
Publicly, Couzens ignored these assertions. But to Tom Payne,
he wrote, “I can say to you, in confidence, of course, that no such offer
was ever made to me by Mr. Farley.” 21 He also denied the Farley
reports in private correspondence with Governor Frank D. Fitz
gerald, who had announced that he, at least, among leading Repub
licans, favored his renomination as against Brucker. To Governor
Fitzgerald, he added:
While the necessity of filing petitions and the primaries are some
what in the distance, I know of no reason why I should not run on the
Republican ticket, unless it be that the party again comes under the
standpat and reactionary leaders who have heretofore had control of
the party. 22
9
Which way the wind was blowing in the Republican party ap
peared to be well indicated by the sentiment at a dinner held in
Detroit in February 1936 by the Wayne County Republican Party.
A headline on February 21 told the story:
JAMES COUZENS' NAME
BOOED AT G.O.P. DINNER
In April, Brucker formally announced his candidacy for the Senate
on a typically Old Guard platform: anti-Roosevelt and anti-Couzens.
Couzens' friends now urged that he also announce. “Every day you
lose in making clear your stand will require at least two days of vig
orous work ... to win back the support you seem to be losing,”
wrote George Averill. 23 That was all too true. But he still hesitated.
In May he told Tom Payne, “I think finally it will be my decision
to enter the Republican primaries.” Then, only a week later, he


THE POLITICAL DILEMMA
3°9
asked Payne to find out if he could legally run as an independent.
Shortly after he inquired of Payne: “How would we go about organiz
ing another party?” 24 That same month, the Democratic party in
Michigan, without consulting him, adopted a resolution endorsing
him for re-election on the Democratic ticket, if he chose to accept.
Would he accept? He declined to say.
10
“There is no doubt that Senator Couzens seriously considered
running on the Democratic ticket,” Prentiss M. Brown, then Dem
ocratic Congressman from Michigan (later Couzens' successor in the
Senate) recalled. Brown himself, among other Democratic Congress
men, urged that Couzens head the Democratic ticket in Michigan.
He was also “authorized from a much higher authority to express the
hope that the Senator would run,” said Brown. 25 But an affirmative
answer could not be pried from Couzens.
One reason for his indecision was that, at times, he considered not
running at all. His secretary, Carson, had in fact urged that decision
upon him. Carson felt that the prospects for victory were too slim,
and, besides, that Couzens was not in good enough physical con
dition to undertake another campaign. He discussed with Couzens
the possibility of his accepting some worthwhile appointment from
Roosevelt. “Without actually committing him, I got him to say that
he would accept an appointment,” Carson recalled.
So Carson began consulting with certain men close to Roosevelt. His
own hope, he later said, was that Roosevelt might offer Couzens the
post of Secretary of the Interior, in place of Ickes, albeit this was
only a hope on the part of Carson, who did not like Ickes. Among
others, Prentiss Brown was interested in Carson's efforts.
Slated to be the Democratic candidate for Senator, Brown was only
too glad to avoid the possibility of a contest between himself and
Couzens. He agreed to talk with Roosevelt about Carson's proposal. 26
But Brown encountered delay in seeing the President. Couzens him
self did nothing to press the matter.
11
In June, he was forced by the political calendar to make a decision
one way or another. Democratic friends, including Murphy and
Brown, continued to press him to accept a Democratic nomination.
He finally turned that down. He told Murphy that to run as a Dem-


gio
THE INDEPENDENT MAN
ocrat, would mean he would be called “a turncoat,” and he could
not “tolerate” that. 27
To Brown he gave yet another excuse. His son Frank, by the kind
of administration he was giving Detroit as mayor, was now launched
on a promising political career. “If I became a turncoat, it would
harm Frank’s political future,” he told Brown. He did not wish to do
that. 28
Actually, there was a deeper reason for his rejection of the Dem
ocratic nomination. He had made a career of being an independent
man. Now, in his last years, how could he most clearly demonstrate
his independence? By seeking refuge in another party? Or by insisting
that he was a Republican even though the Republicans denied it?
His answer to that was inevitable. On June 15, he announced that
he would be a candidate for the Republican nomination. “I am,”
he said, definitely, “a Republican.” 29
Three days later, while he was packing to leave Washington for
Detroit, Congressman Brown received the long-awaited message from
the White House to confer with Roosevelt on “the Couzens matter.”
Couzens was already at the railroad station when Brown later re
ported to Carson on his talk with Roosevelt. The President had in
dicated to Brown that he was ready to make a worthwhile offer to
Couzens. There was a distinct possibility that Farley might retire
temporarily, for the duration of the campaign, as Postmaster General,
Roosevelt indicated. Politically, this seemed an expedient thing, as
the Republicans appeared intent on making a serious campaign is
sue out of “Farleyism.” Even Senator Norris had been stirring up
sentiment against the administration over Farley’s handling of pa
tronage.
Roosevelt would be glad to have Couzens become Postmaster
General for that period, with the understanding that another post
would be found for him after the election. 30
Carson hurried to the station to tell Couzens. “We walked up and
down the station and talked it out,” Carson related. The offer had
come too late, Couzens finally said. Had it come earlier, before he
had announced his candidacy, he might have accepted. “To take the
offer at that hour would make it look as if he had been bought off.
He could not take it.” 31 So he entrained for Detroit for his third
campaign for the Senate.


3 11
CHAPTER XLV
THE INDEPENDENT MAN
In truth, there was no campaign. He still had no organization with
which to make one, a price he paid for having eschewed patronage
in politics.
After fourteen years as a Senator, he was in the pitiful position of
a political leader unable to count on more than a dozen men in the
whole state to serve as the nucleus of a strong campaign committee.
Then, too, he declined to give the signal for the start of any kind of
real effort to get his story to the public.
He made only one speech, a talk to the Detroit Optimist Club, in
which he scarcely referred to his candidacy. “I will be entirely con
tent/' he said, “if the people of Michigan say I am through, if they
are dissatisfied with my work."
Most of the time during this appearance, he spent in answering
questions concerning his attitude toward the Roosevelt administra
tion.
“Was Roosevelt bankrupting the nation?" he was asked.
“Certainly not," he answered. “I have been disgusted with this
constant talk about balancing the federal budget. How could any
body have balanced it?"
Did he expect a “Red government" in Washington as a result of
Roosevelt?
“Absurd," he said. “All three branches of our government, the
legislative, executive, and judicial are functioning."
He made no reference to Brucker, his opponent. Nor did he men
tion Alf M. Landon, the Republican nominee for President.
2
Whereas by all the rules, with his opponent going up and down
across the state, he ought to have been out on the hustings himself,


312
THE INDEPENDENT MAN
he instead chartered, from Leon Mandel of the Chicago department
store, a yacht, the Buccaneer, and spent most of his time cruising
with Frank, William J. Norton, and others on the Great Lakes. It
would be said that he was a man “sulking on his yacht,” because of
chagrin over the impossibility of being renominated. If so, his sulk
ing was a most agreeable kind, for friends who joined him on the
Buccaneer from time to time found him more relaxed and amiable
than they had ever known him. He had, as he wrote to Senator Van-
denberg, “a most delightful and restful summer and, of course, time
to think and think and think.” 1
He did a great deal of fishing. He told stories. One night he held
his guests “enthralled past midnight as he told the true story of the
founding of the Ford Motor Company.”
He talked of his lost boy, Homer. As he recalled that boy, he wept
openly for the first time. Apparently, somewhere in him an emotional
dam had broken. He felt all the better for this, and was able at last,
after twenty-two years, to speak of Homer without bitter regret over
his death. 2
Once while the yacht was on Lake Superior, someone pointed
to the Canadian shore and commented: “If you had not been born
over there, in Chatham, you might have been President.” He laughed.
This was very nearly the same comment he had made to his mother
fifty years before. 3
3
His friends kept pressing him, as the summer wore on, to let some
kind of campaign be put up for him. But he delayed giving his ap
proval. He put them off usually with the assertion that the people
knew his record, so the usual activity was unnecessary.
His real reason was something else. He could not envision himself
making an appeal for renomination without making his stand clear
on the one big issue—Roosevelt. Obviously, he was for Roosevelt.
But should he say so? And when?
His opponent, Brucker, was demanding that he declare himself.
On August 5, at Petoskey, Michigan, Brucker, who twenty years
later would find himself defending Republican President Eisenhower
against the charge of “New Dealism” and “socialism,” asked, “How
can the Republican Party put up a united front against President
Roosevelt and his socialistic doctrine, if the head of the federal ticket
in Michigan is a New Dealer?”
At Cadillac, Brucker said, “I dare Couzens to tell the people of this


THE INDEPENDENT MAN gig
state whether he is supporting Al£ M. Landon, the Republican nom
inee for President, or President Roosevelt.” 4
At Detroit, in a radio broadcast, Brucker said: “Mr. Couzens has
utterly failed ... to say whether he supports Landon or Roo
sevelt. . . . The people are entitled to know. . . . Why isn’t Senator
Couzens out working for Landon’s election? Senator Vandenberg
is out on the stump for Landon, while Mr. Couzens won’t even de
clare himself.” 5
4
The politically wise advice to Couzens was to refrain from answer
ing Brucker. To state openly that he favored Roosevelt’s re-election
could not possibly help his own cause in the Republican primary.
On the contrary, such a statement could only harm his already slim
chances of winning, if not cinch his defeat. If he insisted on coming
out for Roosevelt, he should hold off until after the primary.
On the yacht, Couzens pondered that problem. The primary was
set for September 15. Early in August, Bill Yaw, his son-in-law, be
gan pressing him to approve an advertising budget for a campaign
keyed to two themes—that Couzens was a Republican and that a
big Republican vote was desirable. Henry T. Ewald, the advertising-
agency head, had prepared the campaign. Radio time had to be re
served.
On the afternoon of August 12, as the Buccaneer was off St. Ignace
Island, Couzens reached his decision. On a radiogram blank he wrote
out a message to Yaw:
I intend to announce myself as desiring Roosevelt’s election.
Therefore tell Ewald and Carson all plans cancelled. . . . Also tell
Ewald I do not desire any radio reservations and am unconcerned
about plan of getting Republicans out to vote. . . . 6
He handed the message to John P. Frazer, a friend of Frank’s who
was on the yacht, and asked that he send it. Frazer read the message
and blanched. He argued with Couzens that he should “wait.”
Couzens said no, he had “decided.”
“I won’t send it!” said Frazer.
“If you don’t, I’ll get it on the radio myself,” Couzens replied.
Frazer pleaded some more. But it was no use. The radiogram was
sent. 7
5
Efforts were made by Bill Yaw, Tom Payne, and others to get him
to change his mind. All they succeeded in doing was to get him to hold


THE INDEPENDENT MAN
3 H
up for awhile public announcement of his decision. Maybe something
would turn up, they hoped. They knew that for a Republican can
didate for Senator to come out openly for Roosevelt would doom
even a slight chance of winning in the Republican primary. It just
could not be done—not in 1936.
Couzens insisted that it would be “dishonest” not to make known,
before the primary, clearly and unequivocally his decision. He re
called that back in 1924, Brookhart had been accused of “fraud and
deception” because he favored La Follette, but did not say so until
after he had won the Republican party nomination in Iowa. That
was one of the reasons the Old Guard in the Senate gave for refusing
to let Brookhart take his seat. 8
Couzens would not lay himself open to that kind of thing. He
would not “stultify” himself, he repeated. The Republican voters
had a right to know.
Madeleine Yaw tried her hand at getting him to change his mind,
when he visited her in Harper Hospital, where she was expecting
her fourth child—Couzens* twelfth grandchild.
“Well, Pete,” he greeted her. “I won’t be re-nominated.**
“Why not?** Madeleine demanded.
“Because I am coming out for Roosevelt.’*
“But you don’t have to do that.”
“Yes, I do. That’s the honest thing.”
Madeleine agreed in her heart. But she felt it was not “good” for
him to be defeated. So she kept on arguing with him. But it was no
use. 9
On Sunday, August 23, three days before his sixty-fourth birthday,
the newspapers all over the nation carried his statement:
Believing as I do that the most important matter confronting
the nation is the re-election of President Roosevelt, I intend to sup
port him.
The outcome of my own candidacy is neither important to the
nation nor to me, but I do believe it is important that my many
loyal supporters in Michigan be advised in advance of the pri
mary. . . .
This was the real end of his campaign, such as it was, for re-election.
It was clear immediately that his senatorial career was over, ended
in the way he had started it, by an affirmation of what had been his
greatest aim—to be Couzens, the independent man.


315
CHAPTER X L VI
THE TRIUMPHANT DEFEAT
He knew only too well the consequences. “I have written myself out
of the Senate,” he wrote to Senator McNary. 1 Friends said, “Too bad,
too bad.” His response was, “Not at all. The important thing is that
the New Deal, what it stands for, be firmly entrenched. That means
another term for Roosevelt is necessary. Otherwise the country will
swing back. What happens to me is not important, next to that con
sideration.” 2
Vandenberg was dismayed and suggested to Couzens that he had
yielded to impulse while “mentally disturbed.” “That is not the
fact,” Couzens told him. “On the boat, I had days and days to con
sider the future of my adopted country.” 3
“The odd thing about it,” said Senator McNary, who got to know
Couzens perhaps better than anyone else, “was that Couzens meant
it when he said he acted solely from his view of the good of the
country.” 4
2
The chief beneficiary of his announcement, Roosevelt, was then
on a tour of Western states. Roosevelt was both elated and surprised,
all the more as he knew that Couzens had turned down a chance to
run as a Democrat in place of Prentiss Brown.
The White House
Washington
September 8, 1936
Dear Jim:
It is one of the fine things about public life that every once in a
while the usual rules of the political game are not followed! Your an
nouncement is not only fine in itself but it is especially so because it
came without solicitation or suggestion on my part or on that of
any member of the Democratic organization.
Frankly, I was just as much taken by surprise as, I imagine, Brother


THE INDEPENDENT MAN
3i6
Landon was. I want you to know that I appreciate not alone what
you have said and done but also your manner of doing it—for you
have shown a very deep courage based on conviction and may lose
your Primary as a result.
Perhaps you have not seen this typical vile editorial in the Chicago
Tribune which came to me the other day. I do not give a continental
under which party label you or I may happen to enroll ourselves
but I do know that very fundamentally you and I have the same
ethical standards.
Always sincerely,
Franklin D. Roosevelt 5
3
The “vile editorial” to which the President referred was an ex
ample of the anger Couzens’ announcement had provoked. His sup
port of Roosevelt was part of a conspiracy between him and Roo
sevelt of long standing, the Tribune said. “It is established now that
he [Couzens] helped in creating a hero role for Mr. Roosevelt in
1933.” Had he not caused the nation-wide bank crisis by “blocking”
the RFC loan to the Detroit banks? And had not Roosevelt, too,
opposed aid to the Detroit banks? It was all now clear. They had
purposely set the stage for Roosevelt to win acclaim for saving the
financial system that they themselves had “wrecked.” “Now the people
of Michigan will have an opportunity to wreak their vengeance upon
the two men primarily responsible for that state’s worst calamity.” 6
Loyal Tom Payne also received a letter—typical of the reaction of
certain war veterans who resented Roosevelt’s and Couzens’ attitude
on the latest bonus proposal.
This . . . written against the man you are working for politically,
Senator James Couzens. . . . He has deserted the honest, the up
right, the noble, for the degrading position of a bootlicker to the
most dangerous, damaging demagogue that ever sat in the Presi
dent’s chair. No good can ever come from a turncoat. . . .
4
After docking at Detroit for the day to make his announcement,
Couzens promptly sailed away again on the Buccaneer, to be gone,
except for one short visit to Wabeek in the interim, until primary
day. He did not share the gloom of his associates. Indeed, he was now
noticeably in especially good spirits. He was like a man who had cast
off a great load. He had followed his conscience. As expected, he was
badly defeated. The surprising thing was that he still received
199,204 Republican votes against the 328,560 for Brucker. 7


THE TRIUMPHANT DEFEAT
317
5
Three days after the primary, G. Hall Roosevelt arrived in De
troit with a confidential letter from the President.
The White House
Washington
September 17, 1936
Personal
Dear Jim:
Hall has been with me here in Washington while the returns were
coming in. I need not tell you that you were a good sport because you
were a lot more than that—you lived up to your own ideals. Actu
ally, your run was a feat unprecedented in political history and will
always be remembered.
What I want to convey to you in very simple terms is that you
and your ideals and ability must not, because of a political system
be lost to the country. As you are aware, one of the most difficult
problems before us is that of American shipping. Ever since the
mail subsidies of the eighteen forties, when the Merchant Marine
legislation was first passed, shipping has gone through ups and
downs but always more or less the victim of party politics or of
shipping lobbies.
Today I am confronted with constituting a Maritime Commis
sion under the new bill, which, although not perfect, is very def
initely a step in the right direction, giving powers to this inde
pendent Commission which are far greater than any previously
granted. In fact, this new Commission can put our sea borne trade
back on its feet in an honest way. . . .
What I need and what the country needs is a fearless Chairman
of this Maritime Commission, who will take the responsibility in
setting up and putting through a new and permanent Mercantile
Marine policy. Experts on engineering, ship design, ship manage
ment, etc., can be hired, but a Chairman with the capacity and the
courage I seek cannot be hired; he must be drafted. That is why I
want you on the first of January to undertake the task of heading
the Maritime Commission. . . .
In sending you this note by Hall, I can only reiterate that irre
spective of party affiliations the country needs you in public service,
and I cannot conceive of any higher or more important duty than
getting the Maritime Commission started under real leadership and
under auspices that will be considered neither political nor tinged
with any special interest. I have emphasized courage because it will
take courage to end many abuses which have grown up in the ship
ping industry in the past. You have that courage.
My warm regards,
Faithfully yours,
Franklin D. Roosevelt 8


THE INDEPENDENT MAN
gl8
6
This letter pleased Couzens, but he was not certain that he wanted
to accept the chairmanship of the Maritime Commission. “I do not
know the first thing about water shipping, naval construction or
design, yet ... I would have to assume the responsibility of the de
cision of your so-called experts,” he replied to Roosevelt. He did not,
however, reject the offer flatly. He left the matter open until he would
return to Washington, “probably about election time.”
The more immediate thing, he told Roosevelt, was the election.
He wrote to him:
I want ... to emphasize . . . that the election is not won and
I think there is a lot of work to be done. Great headway could
be made ... by pointing [up] your Good Neighbor policy and
your endeavor to keep us out of foreign conflict. . . . Some simpli
fied form has to be adopted for ridiculing our national debt. I told
Hall that I wanted to be helpful in your campaign and I still do. 9
7
From Vandenberg, he received an interesting testament.
The returns are in—and it appears that we are “parting company”
as Senate colleagues. Under the circumstances, I cannot refrain from
this reminiscent note. I cannot explain my very real affection for you
—but I have it—and there it is.
Many times in the last eight years you have made me “mad as
Hell” and I know that I have had the same effect on you. But most
of the time we have travelled comfortably in double harness and I
have deeply cherished the privilege of knowing you with an intimacy
denied to most other men.
I know that my legislative association with you has been dis
tinctly and usefully tempering to what was originally too “con
servative” a view on my part, and you have had much to do with
instilling in me a sense of “social responsibility” which I hope I
may never lose. 10
Grateful for this from Vandenberg, he yet could not resist the urge
to take advantage of the opportunity to tell Vandenberg that he be
lieved him wrong for supporting Landon, even for the sake of party
regularity.
Let me say to you, Arthur, that if the great mass of our people
who live on an economic precipice ever get the idea back in their
minds that their government has no interest in them and that their
government is only interested in the “big boys,” we will never be


THE TRIUMPHANT DEFEAT
319
able to stop the growth of communism and the other isms that are
being propagandized in our country. That is one of the reasons I
do not want Mr. Landon elected. I think it would be a setback. . . .
Nor did he resist telling Vandenberg that he hoped he would not
have Brucker as a colleague. He frankly asserted that Prentiss Brown
should be elected, ‘‘in the interest of Michigan and our country/’
He noted that Vandenberg had told him that his advice would con
tinue to be welcomed.
This leaves me free to be as candid with you in the future as I
have been in the past and I think that over the years I probably
will be availing myself of it. You know we still have a Washington
house and I am going down there after the election to spend some
considerable time. . . . u
8
What he expressed there was only a hope. For within a week after
the primary his health took another bad turn. Just after his talk with
Hall Roosevelt on September 18, in his office in Birmingham, he
felt so weak and feverish that he went home early in the afternoon and
to bed. Feeling the need for more air in the room, he got out of bed
to open a window. He came close to collapsing from the sudden pain
caused by the exertion—and it was found that he had injured his
sacroiliac. 12
Five days later he was ordered to Harper Hospital in Detroit “for
treatment,” as he himself recorded in his notebook, “for jaundice,
diabetes, and sacroiliac.” 13
A postscript to his letter to Vandenberg told the story:
I am signing this in the hospital, so forget the errors. I am feeling
very rotten. Jim.
Bill Yaw visited him on October 1. That afternoon he wrote to
Carson:
Frankly, I am quite concerned about the Senator’s health. . . .
I am not at all pleased about his general condition. ... I have an
idea that he really feels his defeat more than he thought he would,
although I am sure that he has no regrets that he was unwilling to
compromise his convictions.
On October 2 Couzens decided to leave the hospital. The old re
bellion against being inactive returned. As a compromise, he took
a suite at the Book-Cadillac Hotel, where Dr. Freund could be closer
to him. He had “things to do,” he insisted, like preparing to help


320
THE INDEPENDENT MAN
the Roosevelt campaign and also for paying a visit to Madeleine and
her new baby, a boy, James John Yaw, born on August 28, two days
after his own birthday. He felt so well that during the next few days
he took Mrs. Couzens to several shows, including a performance of
Romeo and Juliet. They even drove out to Wabeek.
On October 7 Marvin McIntyre, one of Roosevelt's secretaries,
called from Washington to ask him if he would be in Detroit on
October 15, when Roosevelt was to make a campaign visit there.
The President wanted to see him on that occasion. 14 Couzens said
that he would, and that certainly he would be glad to see Roosevelt.
On the 10th a letter from Roosevelt himself arrived. It said:
. . . You are right about the campaign not yet being won. I
expect to spend one day—October fifteenth—in Michigan, and I
hope that I shall see you at that time, if only for a few minutes. It
would help me if you were seen with me! 15
9
He accepted the position of honorary chairman of the committee
in charge of the Detroit reception for Roosevelt. 16 On Monday, Oc
tober 12, he invited Arthur Krock, Washington correspondent of
the New York Times, out to Wabeek for an interview on the political
situation. He predicted that Roosevelt would sweep Michigan. 17
He seemed then to be in fairly good shape. But on Wednesday,
October 14, Dr. Freund ordered him back to Harper Hospital when
he developed a stomach disorder that prevented him from keeping
down any food. So he was at the hospital in Detroit when Roosevelt
came into Michigan from Chicago on a special train.
At Flint, Frank Murphy, campaigning for governor, told Roo
sevelt of Couzens' new illness. The President said he would go to
see Couzens at the hospital. But Couzens would not “stand for it."
“It wasn't right for the President to come to him." 18 He said he would
keep his date with the President, if he were at all able.
So, in the late afternoon of the 15th, he left his bed at Harper and
went by automobile to the Grand Trunk Railway yards in Highland
Park to greet Roosevelt in his campaign car.
While waiting for the President's train to be switched into place,
he talked with a local Democratic leader about his own political po
sition. “Some people have asked me why, if I would not join the
Democratic Party, did I not lead a third party in Michigan. The
answer is that I am too ill for anything like that."


THE TRIUMPHANT DEFEAT
321
He did not have to emphasize that he was ill. It showed in his face
and in his posture. He had had no nourishment for two days. In the
President’s car he was to have dined with Roosevelt. He joined the
President, but all he took was a glass of milk. 19
10
He stayed with Roosevelt through the whole strenuous evening.
He was in the parade through the city. He stood with the President
at a rally in Hamtramck Stadium, built by the PWA. At a great mass
meeting that night in front of the Detroit City Hall, he was there,
ill as he was.
Detroit had never before seen such a turnout for any candidate.
But that mass meeting was really for Couzens as well as for Roosevelt.
For when he was introduced to the throng, a “thunderous cheer”
went up for him. 20
He was pleased by the speech Roosevelt gave that night. The Pres
ident talked of the importance of building up mass purchasing power.
He spoke of the need for more security for labor—and got down to
cases with mention of the automobile industry. “It is my belief that
the manufacturers of automobiles and the manufacturers of many
other necessary commodities must, by planning, do far more than
they have done to date to increase the yearly earnings of those who
work for them.” 21
This was almost precisely what Couzens had in mind nearly twenty-
two years before when, just a few blocks away, he had addressed the
Board of Commerce on the responsibility of Detroit’s employers to
their employees.
He had been called names for having made that speech in 1914.
He had been denounced for the five-dollar-a-day plan. And now here
was the President of the United States enunciating those views as
government policy. So this night was one of triumph for him, triumph
despite his personal defeat. He might be out of the Senate, but Roo
sevelt would be re-elected, he felt, despite a Literary Digest poll that
forecast an overwhelming Republican landslide.
Thus his own policies would be carried on.
Roosevelt gave him a warm handshake in thanks for his having
come out that night.
“Take good care of your father,” said Roosevelt to Frank, who, as
Mayor, was the President’s official host. “We need him.” 22


CHAPTER XLVII
“THE END OF THE ROAD”
Whether or not the exertion of being with Roosevelt that night had
harmed him, none could say. He was obviously exhausted. Frank
and Bill Yaw escorted him from the Roosevelt meeting to the Book-
Cadillac Hotel, where Dr. Freund was waiting to take him back to
the hospital.
Dr. Freund saw that he was over-fatigued. '‘Was it worth it?" he
asked, after they were settled in an automobile on the way to Harper.
"Yes. Definitely," Couzens answered.
"Just why do you think it's so important to re-elect Roosevelt?"
"Here’s something I have never told anyone," Couzens said. "The
President has told me that he is afraid that war is coming. It may come
from Japan. If that happens, all this opposition to the New Deal will
not mean anything. I think Roosevelt is the one man to be our leader
if we have a war. That’s one reason I feel he must be re-elected even
though I am a Republican." 1
2
He was glad to get into bed at the hospital. "I’ll never be back
with you at Wabeek," he told Madeleine. 2
On October 20, his condition was such that his daughters Margo
and Betty were called from Washington to be at his bedside, along
with Madeleine, Frank, and Mrs. Couzens. By then Dr. Freund and
consulting physicians had determined that he was a victim of uremic
poisoning, on top of all the other ailments. Through Carson, Roo
sevelt was advised that Couzens* condition was desperate. The Pres
ident sent a telegraph message which, he hoped, would help rally
Couzens’ spirit.
I KNOW THAT YOU LIKE A FIGHT AND I AM PUTTING ALL MY FAITH IN
THAT DOGGED DETERMINATION OF YOURS. IT HAS WON MORE THAN ONE
B22


3*3
“the end of the road”
FIGHT FOR YOU AND IT IS STILL OUR BEST BET. I HOPE YOU WILL BE
YOURSELF AGAIN VERY SOON. I NEED YOU AND SO DOES THE COUNTRY.
FRANKLIN D. ROOSEVELT. 3
He did seem to rally. On the 21st, Dr Freund said that he believed
he was gaining. “The pulse and temperature are normal.” 4 But on
the following afternoon his temperature went up again. A medical
consultation was held. Then Dr. Freund said to him: “Senator, we
are not satisfied with the way you are getting along.” Dr. Freund
decided that another operation was necessary.
3
He had been through this before—seven, eight, nine, even more
times—too often to count accurately. Each time before, he had put
up some kind of protest. But not now. The old spirit was ebbing.
“All right. It’s all right with me.” 5
Frank, who had sat in on the medical consultation, expressed
dismay that another operation was ordered. But his father smiled
at him. “Don’t worry.” he said. “They can’t kill an old dog like me.”
Mrs. Couzens was permitted to see him for a moment before he was
wheeled from the room. He held out his hand to her and she clasped
it. “I’ll see you later, Mother. Don’t worry.”
They operated at 3:00 and he was brought back to his room at
4:00. Dr. Freund said to Mrs. Couzens, as they waited his awakening
from the anaesthetic, “It was the only thing to do. It was the end of
the road.” 6 So it was—October 22, 1936. He did not wake up.
4
Death is the Great Biographer.
For some time, the attacks on James Couzens in the conservative
press and by the politicians, notably in connection with the bank
case, had obscured the esteem with which he was held by the people.
Likewise, they had obscured his truly remarkable career.
Now, suddenly, on every side, it was remembered that he had been
more than a man in politics. Suddenly, it was remembered that he
he had been one of the great builders of American industry, starting
from scratch; that he had struck mighty blows for the workingmen
while still an industrialist; that, after making millions, he had re
tired not to leisure, but to public service; that he had been a great
and constructive mayor before he had become an outstanding senator;
that he had been a benefactor of children through philanthropy


324
THE INDEPENDENT MAN
equaled by few; that he was that rare thing, an honest man in politics.
In the words of a writer in the New Republic, he was the “perfect
example of the honest man in politics . . . the most intellectually
honest man ... in Washington.” 7
5
Even men and women who had been taught to dislike him, sud
denly realized that a great void had been caused by his passing, that
a man of uncommon strength had been among them. All this was
reflected in the honors that were paid to him, by adversaries as well
as admirers, now that he was gone. Never in the history of his city
and his state was any man so honored in death as was this man who
had come there forty-six years before—a youth from a small town
in neighboring Canada.
The city government of Detroit asked that his body lie in state
in the City Hall, the resolution for that being introduced in the
Common Council by Councilman John Lodge, with whom Couzens
had had one of his celebrated “rows” as mayor. The flags of all public
buildings in the city were ordered kept at half-staff for thirty days.
Long was the line that passed by the coffin in the City Hall, a line
composed almost wholly of wage-earners. Perhaps never had a mil
lionaire been mourned so sincerely by so many from the common
ranks of a community. Their outpouring emphasized the strangest
and also strongest aspect of his life, that with all his great wealth he
made himself a symbol of opposition to arrogant wealth and a
champion of those who lacked any wealth at all.
At Bath, Michigan, the children in a school that he had erected
there to replace one wrecked by a maniac in 1927, spontaneously
contributed pennies for a floral tribute. There was sadness among
the attendants at the Children’s Hospital of Michigan. They remem
bered that the work they were doing for their crippled charges had
largely been made possible by his generous giving. There was sadness
in the hearts of countless fathers and mothers of the poor who knew
that their children’s lives had been enriched because he had es
tablished the Children’s Fund of Michigan, then in its sixth year.
They would not have understood the comments of certain politicians
and industrialists to the effect that he was a “cold man.”
Tributes poured in from all over the nation, for the man who
had been the boy in Canada who made himself not just a Detroiter


3*5
“the end of the road”
and a Michigander, but an American “of unique renown,” 8 For once
all the tributes were honest, as if his candid—often too candid—spirit
controlled them. There were no false notes, no generalities to fit any
public man.
Roosevelt interrupted a speaking tour in Connecticut to say:
In the death of Senator Couzens the Senate of the United States
and the people of Michigan and the Nation have lost a leader
whose convictions were a part of the best that America aspires for
and whose courage was a match for his idealism.
Senator Couzens did not enter public life because he sought
either fame or power, but rather because of a service he believed he
could render to the cause of progressive thought and political up
rightness. He was a party member. But his prior obligation was to
the well-being of the people whom he served. He never hesitated
in that service.
The death of Senator Couzens to me is a great loss. But, more
than that, it is a great loss to the multitudes of Americans whose
needs and problems were always in the forefront of his thought and
action. 9
All city and county offices in Detroit were closed for the funeral
on October 26. Recalling that he had established the municipally
owned transportation lines, the Detroit Street Railway brought every
streetcar and bus in Detroit to a halt for a minute at the hour the
body was placed in the mausoleum in Woodlawn cemetery.
Recalling his services as commissioner of police, nearly all of the
city’s policemen lined the highway of the funeral procession from
Wabeek to the cemetery.
More than two thousand persons were present at the interment.
The honorary pallbearers were men who had known him or had
been associated with him in all the phases of his career—Ernest C.
Kern, Joseph Mack, Clarence H. Booth, William O’Leary, Dr.
Freund, William J. Norton, John P. Frazer, C. H. Haberkorn, Jr.,
Thomas Payne, George B. Judson, Clarence E. Wilcox, and Henry
Ford.
7
In the week after the funeral, there was held at Traverse City, Mich
igan, where only that previous June his Children’s Fund had ded
icated the Central Michigan Children’s Clinic, a spontaneous com
munity-inspired memorial service. There, William J. Norton, the
director of the Fund, gave a nearly perfect tribute, an honest ap
praisal.


326
THE INDEPENDENT MAN
This man was a rugged and dauntless fighter. He was no molly
coddle. He was a warrior's captain. . . . He fought always on the
side of justice and human rights. His sword was never drawn in the
cause of special privilege. Mistakes of the mind he no doubt made
in some of the causes he espoused, for he was intensely human, but
mistakes of ethical purpose—never.
His conscience held the most finely etched pattern as a guide for
his own conduct that I have ever seen in any man of wealth or
dominance. Simple honesty, complete integrity, a sense of great re
sponsibility, cold-blooded objective justice, perfect faith in the demo
cratic ideal, and a love for gentle charity were all burned clearly
and distinctly into that ethical pattern that acted as his sole governor
in all of his public relations. . . . Those ethical mandates were the
only masters he acknowledged. . . .
On the first anniversary of his death, Edgar DeWitt Jones, the
minister, in a nationwide radio broadcast, came close to voicing in
seven words the complete epitaph: “He preserved his individuality
to the end.”
In a large sense, to do this had been his career.


Appendices
NOTES
BIBLIOGRAPHY
INDEX



NOTES
Prologue: October 12, 1915
1. The scene between Couzens and Ford is based on the transcript of an interview
given by Couzens to Judge Neil, a magazine writer, on July 27, 1926, and approved
by Couzens as authentic. Copy in Couzens’ papers. The interview, in substance, was
published in Real America, April 1934. John C. Lodge’s comment was made to author,
1941. See his book, I Remember Detroit, in collaboration with M. M. Quaife, 1949.
2. Before U.S. Board of Tax Appeals, 1927, Transcript.
3. Milo M. Quaife, The Life of John Wendell Anderson, p. 140; also in U.S. Board
of Tax Appeals, 1927, Transcript.
Chapter I. The Beginning
1. Homer Couzens, brother of James Couzens, interview in Detroit, 1940.
2. “Historical Chatham,” supplement with The Planet Souvenir of Chatham, On
tario, 1904.
3. Homer Couzens, interview; and Alice Couzens Lund to author, September 23,
1941.
4. Mrs. James Couzens, interview.
Chapter II. The Canadian Boy
1. Homer Couzens, interview.
2. Alice Couzens Lund, a sister, in a letter of September 23, 1941.
3. Ross Schram, an unpublished story of James Couzens' life to about 1920, in
Couzens’ papers. A Detroit newspaperman, Schram had served Couzens temporarily as
secretary.
4. Detroit Journal, January 26, 1915.
5. Homer Couzens, interview.
6. Detroit Journal, January 26, 1915.
7. Alice Couzens Lund, letter, April 18, 1940.
8. John Carson, secretary to Couzens, to author, 1941.
Chapter III. The Money-Making Machine, 1
1. Interviews in Chatham: William Mann, Frank Baxter, Charles Donovan, et al.,
1941.
2. James Couzens, article in Nation’s Business, December 1926.
3. Charles Donovan, memorandum for author, 1941.
4. Victor Lauriston, Chatham, unpublished article loaned to author, 1941.
5. Albert L. Couzens, letter, September 23, 1941.
6. Alice C. Lund, letter to author, September 7, 1940.
7. Pipp’s Weekly, June 16, 1922.
8. Charles Donovan of Chatham, letter to author, October 1940.
9. Homer Couzens, interview.
10. Arthur Stringer, Canadian novelist, boyhood friend of James Couzens in
S«9


SB 0
NOTES
[ftp. 21-2$
Chatham, author of the book about a Chatham boyhood, Lonely O'Malley; letter to
author, December 19, 1940.
11. William Mann and Frank Baxter, boyhood friends of Couzens in Chatham,
interviews, February 7, 1941.
12. Interview with Bill Turtle in Chatham, February 6, 1941.
13. New York Times, December 20, 1922, and Detroit papers—stories based on
interviews with James Couzens after his appointment to the U.S. Senate; also Detroit
Journal, January 26, 1915, a basic item on his youth.
Chapter IV. The New Detroiter
1. Homer Couzens, interview: also Daniel Hackett, fellow worker at the Michigan
Central Railroad and the late mayor of Jackson, Michigan, interview, 1940.
2. Schram, unfinished study of Couzens, op. cit.; also Catlin, The Story of Detroit,
and the works of Milo M. Quaife.
Concerning the automobile industry and its founders, the most recent study, also
the fullest and no doubt the best, with certain reservations as to interpretations, is by
Allan Nevins, in collaboration with Frank Ernest Hill and others of Columbia Uni
versity, published in 1954 under the title Ford: The Times, The Man, The Company.
It is cited here as Nevins, Ford, I. A second volume of this important study, entitled
Ford: Expansion and Challenge 1 pi5-1935, was published in 1957, and is cited here as
Nevins, Ford, II.
For readers who may be curious about certain similarities between that study and this
book with respect to the treatment of James Couzens and his role in the Ford Motor
Company from its founding to 1915, the explanation is that, as a matter of academic
cooperation, the typescript of this work, before it was put in final form, was made
available to Professor Nevins, as courteously acknowledged in the Nevins study. The
typescript of the unfinished version of this book is cited in the Nevins study as “Harry
Barnard, James Couzens of Detroitwhich was the working title of this book. For an
especially excellent though short study of Henry Ford and the company see Roger
Burlingame’s Henry Ford: A Great Life in Brief, 1955.
3. Sidney Glazer, in Quaife and Glazer, Michigan, From Primitive Wilderness to
Industrial Commonwealth, pp. 247 and 281.
4. Catlin, op. cit., pp. 586-606.
5. Couzens to Daniel Kiefer, March 5, 1917.
6. Daniel Hackett.
7. A. T. Dempster, a Michigan Central employee, interview.
8. Ibid., and Detroit News, April 13, 1924.
9. Arthur J. Lacy, Detroit attorney, whose firm, Anderson, Wilcox and Lacy,
handled Couzens’ legal affairs over a long period, interviews, 1940.
10. A. C. Goodson of the Michigan Central, in Detroit News-Tribune, October 27,
l 9'5-
11. Daniel Hackett, memorandum for author, 1940.
12. Daniel Hackett, op. cit.
13. Michigan Central Railroad records, copy prepared for author.
Chapter V. The Coal Clerk
1. John Gunther, Inside U.S.A., p. 403. Mr. Gunther did, as he wrote, find out
that Malcomson was an original stockholder in the Ford Motor Company, owning
an amount of shares equal to Ford’s. He said, “Ford must, of course, have bought him
out many years ago, as he bought out Couzens.” But it is no wonder that Mr. Gunther
did not come out with the full story about Malcomson. Until recently, most accounts
of the Ford company left Malcomson out, or included him only glancingly, especially
the stories supposedly authored by Ford.
2. Detroit Journal, October 27, 1902.
3. A. R. Malcomson, interview, 1942.
4. Detroit Free Press, April 1, 1903; see also Jere C. Hutchins, A Personal Story,
pp. 283-84.


pp. 30-39] NOTES 331
5. A. R. Malcomson, interview; also comments by Helen Malcomson Gore, his
daughter, in a letter to the author dated July 25, 1942.
6. Ross Schram, op. cit.
7. Ibid.
Chapter VI. The Family Man
1. Mrs. James Couzens, interview, 1940.
2. Ibid.
3. Ibid.
4. Frank Couzens, interview, February 13, 1941.
5. Mrs. James Couzens, ibid.
6. Couzens to his daughter, Madeleine C. Yaw, November 14, 1933.
7. Mrs. David Huffman, letter to author, August 27, 1941.
8. Jay G. Hayden of the Detroit News, interview, April 17, 1940.
9. Mrs. James Couzens, interview.
Chapter VII. The Ford Motor Company
1. In My Life and Work, 1922, p. 36, actually written by Samuel Crowther, a work
to be read with great caution. See Burlingame, Henry Ford, p. 185, for pertinent com
ments. Data about Malcomson and Ford, based on interviews with various persons
who knew them both, including A. R. Malcomson and Mrs. Couzens, and also
Schram’s work.
2. McManus and Beasley, Men, Money, and Motors, p. 1. This work is exceptionally
well authenticated, for many principals read it over before publication, and it rates
as a primary source on Ford and others. It is cited hereafter as “McManus.”
3. McManus, op. cit., pp. iff.; see also Nevins, Ford I, op. cit., p. 185.
4. McManus, op. cit, p. 2; see also Glasscock, The Gasoline Age, pp. 50-52, and
Doolittle, The Romance of the Automobile Industry, 1916.
5. McManus, op. cit.
6. Detroit News, July 11, igig; Nevins, Ford, l, includes an extended account
of the Henry Ford Company, pp. 2o6ff.
7. Burlingame, Henry Ford, p. 29; also interviews in Detroit by author.
8. Charles B. King, Psychic Reminiscences, pp. 18-19.
9. John W. Anderson, testimony, in Dodge, et al., v. Commissioner of Internal
Revenue, U.S. Board of Tax Appeals, 1927 (known as the tax case brought against
Couzens by Secretary of the Treasury Andrew W. Mellon; see infra.), Transcript,
pp. 1270-72. Hereafter the record of this case will be cited as Board of Tax Appeals,
Transcript See also Nevins, Ford, I, pp. 226ff.
10. Quaife, The Life of John Wendell Anderson, privately printed in 1950, pp.
8gff. A copy of this book was courteously loaned to the author by Milo M. Quaife.
11. Ibid., p. 107; also interviews by author.
12. Schram, op. cit.
13. Schram, op. cit. Schram’s account is based upon talks with Couzens himself.
14. Benson, The New Henry Ford, p. 103. Benson talked with Couzens as well as
Ford.
15. Ibid.
16. J. C. Long, Roy D. Chapin, 1945, p. 35, concerning the Dodges’ work for Olds.
Chapin, who became head of Hudson Motor, started with Olds.
17. Benson, op. cit., p. 103.
18. John W. Anderson to his father, Dr. Wendell A. Anderson of LaCrosse, Wis
consin, June 4, 1903. This letter is a primary source of exceptional value on the
founding of the Ford Motor Company. A copy was made available by Anderson’s asso
ciates. Quaife, in his Life of Anderson, publishes it in full, pp. 94®, and also it is in
Schram, op. cit.
19. Ibid.
20. Ibid.
21. John W. Anderson, Transcript, op. cit., 1273.


332
NOTES
[PP- 39-48
22. Philadelphia Evening Public Ledger, interview, December 4, 1922.
23. McManus, op. cit., p. 28.
24. Charles T. Bennett, president of the Daisy Air Rifle Company, interview with
author, July 11, 1941. Bennett put $5,000 into the Ford Motor Company, but sold out
later.
25. McManus, op. cit., p. 29.
26. Detroit Free Press, April 1, 1903.
27. Benson, op. cit., p. 115.
28. McManus, p. 31. Couzens also tried to enlist share buyers, but from book
to book, a story has been printed, as in Simonds, Henry Ford, 1943, to the effect that,
once after failing, Couzens sat on a street curb and burst into tears, which sidelight on
him may be dismissed as incredible.
29. Quaife, Anderson, op. cit., p. 102.
30. Merle Crowell, in American Magazine, February 1923.
31. McManus, op. cit., and others.
32. Anderson letter, op. cit.
33. Mrs. James Couzens, interview, June 27, 1941.
34. Ibid.
35. Detroit News, January 20, 1927. Several books erroneously refer to Couzens’
sister Rosetta as having taught school in Detroit. It was in Chatham.
36. Schram, op. cit., and interviews.
37. Ibid.
38. Minutes of the Ford Motor Company, in Board and Tax Appeals Transcript,
p. 425.
39. Ibid.
40. A. R. Malcomson, interview, June 23, 1941; also Mrs. James Couzens, interviews.
41. Anderson, op. cit.
Chapter VIII. The Business Manager
1. Detroit Times, December 3, 1922.
2. See Nevins, Ford, I, p. 229, for example, concerning Ford’s appreciation of C.
Harold Wills' “severity”; also Marquis’ Henry Ford, An Interpretation (1923), in many
ways perhaps still the best study of Ford the man. Pertinent, too, of course, is the rela
tionship between Ford and Harry Bennett, among others, after Couzens left. See
Bennett’s remarkable story, We Never Called Him Henry. Also Robert Coghlan’s super
lative piece in Life, February 28, 1955.
3. See Nevins, Ford, I, p. 503; also Marquis.
4. B. C. Forbes, “Why Multimillionnaire Couzens Quit Business,” in Forbes Maga
zine, December 1922.
5. Couzens interview, Philadelphia Public Ledger, December 4, 1922, and Forbes, op.
cit.
6. Vernon Fry, interview with author, June 1941.
7. My Life and Work, p. 56.
8. Anderson, op. cit.
9. Ford Times, July 1, 1908, p. 8; in Nevins, Ford, I, p. 214.
10. Stipulation on Ford history, Board of Tax Appeals, Transcript, pp. 424-25.
11. New York Times, October 14, 1915.
12. McManus, op. cit., p. 20.
13. Quaife, op. cit., p. 105.
14. Couzens to J. W. Anderson, “Statement of Business, October 1, 1903.”
15. Detroit News, January 23, 1937.
16. McManus, op. cit., p. 20.
17. Stipulation, Board of Tax Appeals Transcript, pp. 425 and 435; also Nevins,
op. cit., p. 262.
18. McManus, op. cit., p. 25; also B. C. Forbes interview; see also Garet Garrett,
The Wild Wheel, 1952, p. 113, among the most perceptive works on Ford, although
quite subjective.
19. Testimony of P. E. Martin, Transcript, pp. 846-50.


NOTES
333
pp. 48-57]
20. Stipulation, Transcript, p. 426.
21. Norval Hawkins, Transcript, p. 1610.
22. Ford Times, July 1, 1908, p. 8.
23. Garrett, The Wild Wheel, p. 113. See also, for Couzens’ role in the company,
Charles E. Sorensen, My Forty Years with Ford, pp. 36, 43, 84, 86-88, and 153.
Chapter IX. The Cloud
1. Ford Times, July, 1908.
2. Couzens notebook, 1906.
3. Bennett, interview, op. cit.
4. Detroit News Tribune, October 19, 1915.
5. James Couzens, “What I Learned About Business From Ford,” System magazine,
September 1021, p. 261.
6. Ibid.
7. Ibid.
8. Ford Times, September 15, 1908.
9. Couzens, op. cit., p. 262.
10. Schram, op. cit., p. 252.
11. Article by Oscar E. Hewitt, in the Chicago Herald, October 23, 1916.
12. Milton R. McRae, Forty Years of Newspaperdom.
13. Detroit News, October 19, 1915.
14. Ida M. Tarbell, manuscript of planned book on Ford Motor Company, loaned
to author, 1942.
15. Transcript, p. 1281.
16. George D. Selden, in Rochester Alumni-Alumnae Review, February-March
1940, p. 16.
17. Ibid.
18. Patent No. 549,160, U.S. Patent Office.
19. George Byers, in The Patent Office Journal, October 1940, p. 725.
20. See Nevins, Ford, I, 98n. and 284ft., and other sections, for a superb description
and analysis of the Selden patent matter, the best and most complete ever done. For
the text of the licensing agreement, a curious document, see appendix of Epstein,
The Automobile Industry.
21. Quaife, op. cit., p. 116.
22. Anderson testimony, Board of Tax Appeals, Transcript, pp. 643-44.
23. Transcript, pp. 643-44.
24. In Detroit Saturday Night, quoted by Glasscock, p. 141.
25. Transcript, p. 1284; also Glasscock, p. 78.
26. Glasscock, op. cit.
27. McManus, op. cit., p. 56. It should be noted that nearly everyone who writes
about the decision to fight the Selden patent gives credit for the decision to a different
person. Quaife, in Anderson, seems to give it to Anderson. Nevins, in Ford, seems
to give it to Ford and Ralzemond A. Parker. Burlingame is quite neutral on this point.
The McManus and Beasley account is used here as most objective, based, in the
author’s judgment, on the best sources. The final decision, of course, was a cooperative
one.
Chapter X. The Realignment
1. Anderson testimony, Transcript, p. 1284.
2. American Encyclopedia of the Automobile, pp. 176-77.
3. Frederic R. Coudert, one of the attorneys, letter to author; and Mrs. James
Couzens, interview. For watching carefully the expenses of some of the lawyers,
Couzens not surprisingly incurred the antipathy of one or two, as witness the slurring
comments about his role in the patent case attributed to a son of one lawyer, in
Nevins, Ford, I, p. 424n.
4. The Automobile Review and Automobile News, October 15, 1903, p. 156.
5. Transcript, pp. 674-76.
6. Appel, The Business Biography of John Wanamaker, p. 155.


334
NOTES
[pp. 57-67
7. Couzens article in System, op. cit., p. 263.
8. Harper's, March 16, 1907.
9. Ford Times, June 15, 1908.
10. Transcript, p. 755.
11. Rackham testimony, Transcript.
12. A. R. Malcomson, interview, June 23, 1941.
13. McManus, op. cit., p. 20.
14. Couzens to Madeleine C. Yaw, January 30, 1928, quoting Ford.
15. Mrs. James Couzens, interview, June 27, 1941; also A. R. Malcomson, June 23,
1941.
16. A. R. Malcomson, interview, June 23, 1941; also C. H. Bennett, interview.
17. McRae, Forty Years in Newspaperdom, p. 393.
18. Detroit News, May 23, 1917.
19. Ibid.
20. Benson, op. cit., p. 116.
21. Minutes, Ford Motor Company, September 9, 1905, in Transcript.
22. Board of Tax Appeals, Petitioner's Statement of Facts, p. 47.
23. Ford Times, August 17, 1904.
24. McManus, op. cit., p. 144. There is a suggestion, in Nevins, Ford, I, p. 247, that
there was some basis for dissatisfaction over the quality of work done by the Dodge
brothers, implying that this was a factor in the Ford Manufacturing Co. scheme. This
is certainly debatable, as the Dodge Brothers, then as later, were universally known to
be dependable manufacturers. They would be criticized, but not for the quality of their
products.
25. Vernon Fry, interview; See also testimony by Norval Hawkins, Transcript, pp.
1960-61, and Sorensen, My Forty Years with Ford, pp. 72-78.
26. Minutes of the Ford Motor Company, November 17, 1905.
27. Michigan Corporations and Securities Commission records, November 29, 1905.
28. Ibid.
29. Malcomson's letter in minutes of Ford Motor Company, December 22, 1905; also
in Detroit News, February 22, 1927.
30. Minutes for December 22, 1905.
31. Automobile Magazine, May 1906, p. 354.
32. Sinsabaugh, Who Me?, p. 222.
33. A. R. Malcomson, interview, June 23, 1941.
34. See Nevins, Ford, I, pp. 278 and 330.
35. Minutes of Ford Motor Company, quoted in Detroit News, February 22, 1937;
also interview of Fry by author, July 8, 1941.
36. In 1955, the Ford Motor Company, under Henry Ford II, and in connection
with the Ford Foundation, for the first time became a public corporation, with Ford
shares available to the public.
37. Ford to Couzens, cablegram, November 19, 1906, in Couzens papers.
38. Couzens to Judge Neil, interview, July 27, 1926.
39. Mrs. Couzens, interview; see also Nevins, Ford, I, generally.
40. System, op. cit., p. 262.
41. See Sorensen, My Forty Years with Ford, pp. 36, 43-44, 86-88.
Chapter XI. The Money-Making Machine, II
1. Gibbons, John Wanamaker, II, pp. 122 and 128.
2. Testimony, Frank W. Blair, president, Union Trust Co., in U.S. Senate Com
mittee on Banking and Currency, Transcript of Hearings, 73d Congress, 2d Sess., p.
4766.
3. Ford Times, December i, 1908.
4. See Sward, The Legend of Henry Ford, pp. 22ff.
5. Ford Times, October 15, 1908, p. 10.
6. Ibid., 14.
7. Ibid., September 15, 1908.
8. Crowther interview of Couzens, System, op. cit., p. 264.


NOTES
335
pp. 67-76]
9. Minutes o£ April 22, 1907.
10. Transcript, U.S. Board of Tax Appeals, pp. 430 and 440.
11. Fred H. Colvin, Sixty Years With Men and, Machines, p. 131.
12. Electric Vehicle Co., et al., v. C. A. Duerr ir Co., et al., 172 Fed. 923, 1909.
13. Ibid, 935.
14. Columbia Motor Car Co., et al., v. C. A. Duerr if Co., et al., 184 Fed. 893, 1911.
15. Board of Tax Appeals, Transcript, pp. 430 and 440.
16. Petition on Appeal, Board of Tax Appeals, p. 34.
17. Ibid.
18. Transcript, p. 1156; also see Sward, op. cit., p. 44.
19. Transcript, pp. 819 and 1705.
20. See Burlingame, Backgrounds of Power, p. 256.
21. Detroit News, November 22, 1913.
22. Testimony before Judge Harry B. Keidan, August 22, 1933, in one-man grand-
jury investigation of the Detroit bank crisis.
23. Couzens to A. E. Stilwell, March 1, 1911.
24. Toronto Daily News, October 21, 1915.
Chapter XII. The Crisis
1. Frank L. Klingensmith, interview. Klingensmith became vice-president of the
company in 1915.
2. Transcript of Couzens’ interview with Neil, op. cit.
3. See Seltzer, A Financial History of the American Automobile Industry, pp. 34
35; McManus, op. cit., p. 68; Epstein, op. cit., p. 225; Pound, The Turning Wheel, A
History of General Motors; Kennedy, op. cit., p. 49; Glasscock, p. 136; Briscoe, in The
Detroit Saturday Night, June 1908; Richards, The Last Billionaire, and Simonds, op.
cit., pp. 114 and 123. The facts about the contemplated sale of the Ford Motor Com
pany are corroborated by William C. Durant, in material from his memoirs, loaned
to the author; and by Herbert L. Satterlee in letters to the author, 1942. The refer
ences cited in the Ford biography by Simonds, a Ford publicist, may be accepted as
confirmation finally coming from Henry Ford himself, in 1943.
4. Herbert L. Satterlee to author, letter, March 12, 1942. He later helped organize
General Motors for Durant.
5. Durant memorandum, op. cit.
6. Couzens notebook, 1908.
7. Satterlee and also Seltzer, A Financial History of the American Automobile In
dustry, pp. 34-35.
8. Durant, Memoirs, excerpt, op. cit.
9. Concerning W. C. Durant, for a good though short account, see David L. Cohen,
Combustion on Wheels, pp. ii2ff.
10. McManus, op. cit., p. 72.
11. Durant, Memoirs, excerpt, op. cit.
12. Ibid.
13. Couzens notebook, October 5, igog.
14. Durant, Memoirs, op. cit.
15. William C. Richards, The Last Billionaire, New York, 1948, p. 350.
16. Durant, Memoirs, op. cit.
17. Ibid.
18. Richards, The Last Billionaire, p. 350. Richards, an associate editor of the
Detroit Free Press, was quite friendly with Henry Ford.
19. Minutes of the General Motors Corporation, quoted by Seltzer, op. cit., p. 36.
20. Ibid.
21. Couzens notebook, October 24, igog.
22. McManus, op. cit., p. 72.
23. Durant, Memoirs, op. cit.
24. Harry B. Harper, interview, November 23, 1940.
25. Player to Couzens, December 24, 1934, and Hay, interview.
26. T. J. Hay interview, August 13, 1940.


NOTES
\pp. J6-86
336
27. See Keith Sward, The Legend of Henry Ford, pp. 430.
28. Malcolm Bingay, for example, in Saturday Evening Post, June 29, 1940.
29. Mrs. W. R. Yaw (Madeleine Couzens) to author, interview.
30. Couzens to Madeleine Couzens, May 11, 1925.
31. Ibid., April 1, 1925.
32. Ibid.
33. Couzens to Edward W. Alexander, December 7, 1915.
34. Neil interview, op. cit.
35. Couzens to R. L. Jobling, October 12, 1912.
36. See Fay L. Faurote, “The New Ford Line-up,” Engineering Magazine, January
16, 1916.
37. Garet Garrett, in Everybody’s Magazine, April 1914.
38. Nevins, Ford, I, p. 573.
39. John C. Lodge, interview, July 3, 1941.
40. Couzens to J. H. Neil, interview, op. cit.; Frank L. Klingensmith, interview with
author, June 30, 1941. Mrs. Ford’s attitude toward Couzens is confirmed in Sorensen,
op. cit., p. 15.
41. Frank L. Klingensmith, interview.
42. Nevins, Ford, 1, op. cit.
43. Couzens interview with Judge Neil, op. cit.
44. Ibid.
45. Ibid.
46. Ibid., also Richards, The Last Billionaire, pp. 244-45.
47. Charles W. Duke, in Philadelphia Public Ledger, July 2, 1933.
48. B. C. Forbes, op. cit.
49. See Reply Brief on Behalf of James Couzens, U.S. Board of Tax Appeals, May
12, 1927, prepared by Arthur J. Lacy and Clarence Wilcox, pp. 66-67. Subjoined to the
statements quoted from this brief was the following significant comment: “Eliminating
Henry Ford, it is reasonable to believe that this program (of expansion) would have
been carried out exactly as planned. Henry Ford was not in charge of that expansion
program, although he agreed with the rest as to its desirability. The minutes show
that it was projected and effectuated by James Couzens and others acted under his
direction.”
50. Detroit News, December 30, 1921.
Chapter XIII. The Five-Dollar-A-Day Plan
1. Mrs. James Couzens, letter to author, July 24, 1942.
2. Couzens to Edward W. Alexander, December 29, 1912.
3. Couzens notebook, entry for July 24, 1912.
4. Nevins, Ford, I, 58 m.
5. Couzens to Chapin, December 18 and December 31, 1912, and January 10, 1913.
Excerpts in J. C. Long, Roy D. Chapin, pp. loqff.
6. Jay G. Hayden, a history of the Detroit railway commission, in mss., loaned to
author.
7. Hayden, mss.; Detroit Free Press, August 4, 1913.
8. Forbes, op. cit.
9. Villard, “The Unique Millionaire,” Forum Magazine, January 1937.
10. Belle C. and Fola La Follette, Robert M. La Follette, p. 352.
11. Gibbons, op. cit., p. 258.
12. Board of Commerce Minutes, 1912.
13. Chicago Tribune, June 2, 1935, article by Willard Edwards.
14. Mrs. Couzens, interview; and Keith Sward, op. cit., p. 50.
15. Highland Park Times, October 6, 1916.
16. From a stenographic copy of Miss Tarbell’s notes, as dictated on a record for
John S. Phillips, editor of The American Magazine, May 28, 1915. Loaned to author by
Miss Tarbell, March 20, 1942. Also her manuscript of chapter 111 of unfinished book,
“Making Men and Fords,” loaned to author, 1941.
17. James Couzens, article in Michigan Manufacturer and Financial Record, Octo
ber 26, 1918.


NOTES
pp. 88-94]
337
18. John R. Lee, “The So-called Profit Sharing System in the Ford Plant,” The
Annals of the American Academy of Political and Social Science, May 1916, Vol. LXI,
P- 8 99
19. Ibid.
20. Tarbell, op. cit.
21. Ibid.
22. Tarbell, op. cit., also Detroit News, November 25, 1914; also McManus, op. cit.,
p. 154.
23. B. C. Forbes, "Multimillionaire Couzens Tells Why He Quit Business,” Forbes
Magazine, December 22, 1922.
24. Tarbell, op. cit.
25. McManus, op. cit., p. 156.
26. Chicago Tribune, June 2, 1935.
27. Interview with Henry Nimmo, Detroit Saturday Night, December, 1914.
28. Margaret Moors Marshall in New York Evening World, December 4, 1922, quot
ing Couzens.
29. Tarbell, op. cit., and McManus, op. cit.; also Chicago Tribune, June 2, 1935.
30. See Simonds, op. cit., p. 138.
31. Theodore McManus and Norman Beasley, Men, Money and Motors, pp. 157-58.
Frank L. Klingensmith, vice-president of the Ford Motor Company, to author, March
5, 1942: "Men, Money and Motors, by McManus and Beasley, is an absolutely authenti
cated book, every word in it having been proofread and approved by representatives
of the various companies mentioned. While the incident of the wage raise is told in
narrative form, the facts are there and I will stand by every word that Beasley wrote.
When it was written (1929) the time had not been so long, and the facts were fresh in
our minds, and I personally O.K.’d the article. I don’t care what Stidger (author of
Henry Ford; The Man and, His Motives, 1923) or anyone else says!” Ordway Tead,
editor of Harper & Brothers economics books, who published Men, Money and Motors,
to author, October 7, 1942: “I never saw or heard of it being challenged.”
32. Couzens to New York World, December 4, 1922; and Ida M. Tarbell, notes.
33. Tarbell notes; also McManus, op. cit., p. 158; Forbes, op. cit.; also Sward, op. cit.,
p. 51.
34. Pipp, Henry Ford, Both Sides of Him, p. 48. Pipp quotes Ford as having said
that he (Ford) first had the idea of increasing wages in order to step up production, to
increase profits, and that he finally decided to make the basic scale $4.84, when Couzens
suggested the five-dollar rate.
35. McManus, op. cit., p. 158. In the lawsuit of Henry Ford v. The Tribune Company,
et al (1919), Transcript of Record, pp. 2713-2716, John R. Lee, first head of the Ford
“sociological department,” testified under oath: "Mr. Couzens, as I remember it, finally
mentioned the fs-a-day and Mr. Ford readily agreed with him.” He also testified:
"Mr. Couzens had been urging him (Ford) largely; I think it was a result of his urging
that Mr. Ford came to this profit-sharing idea.” John Dodge, in the same law suit,
agreed. Transcript kindly loaned to author by the Chicago Tribune’s law firm in Chi
cago, Kirkland, Fleming, Green, Martin, and Ellis, October, 1942.
36. Minutes of Ford Motor Company, for January 5, 1915, quoted in Board of Tax
Appeals, Transcript.
37. Flynn Wayne, "Couzens: A Master Builder in Business Efficiency,” National
Magazine, September 1915.
38. Garrett, “Henry Ford’s Experiment in Good Will,” Everybody’s, April 1914,
p. 462.
39. Excerpts from pamphlet by Ford Motor Company, "Helpful Hints and Advice
to Employees,” in 1915.
40. See Sward, op. cit., pp. 58ff.
41. Detroit Saturday Night, January 1916.
42. Sward, op. cit., p. 52.
43. Couzens to William Robins, February 23, 1916.
44. Couzens to William Robins, November 15, 1915; Sward, op. cit., p. 51.
45. A great many versions of the birth of the five-dollar-a-day plan have been pub
lished, some of them cited in the footnotes, but most are unreliable. The author is


NOTES
338
\pp. 95-106
satisfied that the version here given—one backed by sworn testimony in several court
proceedings, is the correct one. Couzens, of course, explained the differing versions
when he said that it was the Ford company policy, in which he had participated, that
Ford was to get the credit exclusively as a matter of company advertising and public
relations. In all probability, this particular Ford myth will never die. Two books on
Ford published in 1954, Burlingame’s Henry Ford and Nevins’ Ford, I, may help dispel
the myth. Nevins, in a footnote on page 532, makes an interesting comment: “After the
lapse of forty years, the precise facts about this fateful conference (when the wage
scale was adopted) are irrecoverable.” In 1956 Charles E. Sorensen, in My Forty Years
with Ford, presented a version giving the full credit to Henry Ford, pp. 5 and 136-40,
but it suffers from defects common to other versions based upon one perspective.
Chapter XIV. The Final Break
1. Klingensmith to Couzens, February 6, 1914.
2. Ibid., March 27, 1914.
3. See Sward, op. cit., pp. 54-55.
4. Garet Garrett, “A World That Was,” Saturday Evening Post, June 8, 1940.
5. Alfred P. Sloan, “Adventures of A White Collar Man,” Saturday Evening Post,
August 31, 1940.
6. Garrett, The Wild Wheel, p. 9.
7. Garrett, Saturday Evening Post, June 8, 1940.
8. McManus, op. cit., p. 164.
9. Couzens to E. D. Stair, January 8, 1914.
10. Ibid.
11. Detroit Times and Tribune, December 22, 1914.
12. Detroit Labor News, November 1, 1918.
13. Detroit News, November 25, 1914.
14. Simonds, op. cit., p. 147.
15. Henry S. Morgan, interview; also letter to author, August 21, 1942; see Richards,
The Last Billionaire, p. 244.
16. Copy in Couzens' papers.
17. Morgan, interview.
18. Mrs. James Couzens, interview.
19. Klingensmith, interview.
20. Chicago Tribune, June 7, 1919. See also Nevins, Ford, II, pp. 26ff., for Ford’s
peace views and anti-war activities.
21. Toronto Daily News, October 21, 1915.