Four Men & One

When Wall Street found that the President and Congress were going to impose stock exchange regulation regardless, it began pulling wires. It wanted a place for one of its own among the five commissioners who will boss exchanges and administer the Securities Act--a man who could temper the New Deal's belief that all boomtime deals were deliberate snares for the public, that all speculation was evil, that all stock profits were graft, that all "money changers" belonged rightly in Hell.

Last week when President Roosevelt finally named the Securities & Exchange Commission, Wall Street was not surprised that four of its five members were arrant New Dealers. Since commissioners will in future serve for five years, one retiring every year, the first appointments were staggered for varying terms.

The one-year term went to smart, swart Ferdinand Pecora who drummed up the material which made Exchange Regulation possible. He might have had a longer term, but he would not take it, for he is ambitious.

The two-year term went to Robert E. Healy, counsel for the Federal Trade Commission, and in charge of its utilities investigation.

The three-year term went to trade commissioner James McCauley Landis, who helped draft the Stock Exchange Act and has been itching to get his regulatory fingers on Wall Street.

The four-year term went to George C. Matthews, onetime member of Wiscon sin's utilities commission, the man whom President Roosevelt made a Trade Commissioner last October after ousting William E. Humphrey whose conservative ideas did not suit the New Deal. Messrs. Healy and Matthews are nominal Republicans.

Since the Exchange Act did not make clear that the President had power to designate a commission chairman, Mr. Roosevelt did not appoint one. But it was generally assumed that the man he named to the five-year term was his choice for that No. 1 job. The newly-appointed commissioners met in Washington next day and formally elected him chairman. That man was Joseph Patrick Kennedy.

Forty-five years ago three good Democratic wards in East Boston were bossed by a saloon-keeping politician named Patrick J. Kennedy. To "P. J." was born a son, Joseph, who went to Harvard and became a baseball player. After graduation in 1912, Joe turned down a job in the big leagues to try his hand in business. He and a friend bought a sightseeing bus for $1,200. The friend drove while Joe barked. They not only paid for their investment, but in the course of three seasons Joe cleared about $5,000. On the strength of that Joe married Rose, the daughter of John F. Fitzgerald, another good democratic politician who at the time was Mayor of Boston. Today there are nine young Kennedys.

Joe Kennedy was enterprising in more than marriage. He went to Harvard Business School, became a state bank examiner. At 25 he was president of Columbian Trust Co. But he was not cut out for a small banker. He got a job with Boston's Hayden, Stone & Co. Then during the War Charles M. Schwab hired him to run Bethlehem Steel's Fore River Shipbuilding Corp. From buses to banking to shipbuilding, he went on to the cinema. He headed a syndicate that put up $1,000,000 to buy Film Booking Office pictures from its British owners. Soon he was busy in the 1929 occupation of making big corporations out of little ones. He hooked up with Elisha Walker and became chairman of Pathe. The typical success stories of the boom days lavished their phrases of praise on the bright young amusement financier of 39.

Then came Depression and the amusement business went to pot. Joe Kennedy turned his talents to Wall Street and the first blush of recovery found him still up and coming, tinkering with a new business. Last winter when Inquisitor Pecora was prying into the stock manipulations in the summer bull market of 1933, he questioned Henry Mason Day about a pool in alcohol stocks which netted $395,000 in four months. Among the participants in that pool were Harry Sinclair, Walter P. Chrysler, Lehman Bros., Kuhn, Loeb and Joseph P. Kennedy.

Today Joe Kennedy, although only 45 and still able to play 18 holes of golf in the 80's, has a weak digestion, a home in Bronxville, a winter place in Palm Beach, a summer place on Cape Cod, is a capitalist by occupation and the owner of considerable unredistributed wealth.

Thus there was one man of Wall Street on the New Exchange Commission. Only surprising fact was that that man was so typical of all that the New Deal deplores. The explanation was simple: Joe Kennedy is an old friend of Franklin D. Roosevelt. More than two years ago when Governor Roosevelt was angling for the Democratic nomination, Joe Kennedy on one of his trips to Hollywood stopped to see Publisher Hearst who had just got the California delegation pledged to John Nance Garner. It would have been unnatural if the question of California's second choice had not been discussed. After the interview Mr. Kennedy shuttled across the continent to Warm Springs to consult with the Governor. Later California's swing to Roosevelt decided the nomination. In the campaign that followed Democrat Kennedy did not relax his support: he gave $15,000 outright to the Roosevelt cause and lent the National Committee $50,000 of which $33,570 is still owing. After inauguration many were surprised not to see Friend Kennedy more often at the White House. Mr. Farley, however, kept a warm spot for him in the large warm Farley heart, and Son James Roosevelt was at pains to leave the Astor yacht and call on him in Florida last spring.

Last week Joe Kennedy hobbled into the White House; a leg he broke five weeks ago had, in spite of his refusal to have it put in a cast, mended enough for the visit. The President had called him. for the time had come to reward a friend, and secure for the new commission one member who had a practical knowledge of how Wall Streeters act and think and feel.

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