Watergate, page 28
“Pat, you just continue to conduct your aggressive and thorough investigation,” Nixon said, as nonchalantly as he could manage. Only later did it occur to Gray that the president hadn’t asked for any details or evidence leading the charge.
Even as Gray and Nixon spoke, the campaign’s wall of silence was already cracking. On July 1, FBI agent Magallanes received a phone call at home from Peggy Gleason, a CREEP employee he’d unsuccessfully interviewed the day before at the campaign offices. She explained she was calling from a pay phone—she feared she might be being followed—and had more she wanted to say to the FBI than the monosyllabic answers she’d provided when she’d been supervised by a CREEP lawyer. Following her conditions, Magallanes hurriedly picked her up in his personal car, along with his partner Charles Harvey. The trio spent two hours driving around the capital, talking. When the car got too hot to bear, they retreated to a Holiday Inn, where Gleason spoke for seven more hours about what had transpired inside CREEP both before and after the break-in.
A few nights later, Gleason recruited another colleague, Judy Hoback, a campaign accountant, and the two women joined the agents for a long, get-to-know-each-other dinner in the lounge of the Key Bridge Marriott. As Gleason explained, Hoback was a single mother and wanted to be sure she trusted the agents before risking her career to help them. They won her trust, and at her Bethesda house later that night, she revealed what she knew, talking until 3 a.m. about the oddities of the campaign’s financing, its plentiful cash reserves, and McCord and Liddy’s involvement.
The interviews with Gleason and Hoback were incredibly valuable, but paled in comparison to a bomb dropped on July 5 by Al Baldwin: He and the U.S. Attorney’s Office struck a deal for testimony and guaranteed immunity. The Watergate lookout talked. And talked. And talked. For hours, he outlined his odd ten-week employment arc with CREEP, culminating in manning the listening post at the Howard Johnson. The first conversation he heard, he said, “was in regard to a man talking with a woman and discussing their marital problem.” He added that he had also eavesdropped on the conversations of R. Spencer Oliver, the coordinator of the DNC’s state chairs, from 8 a.m. to 6 p.m. daily, according to McCord’s instructions, and prepared logs that McCord picked up each evening. He explained that he had no idea he was doing anything illegal; the imprimatur of McCord and CREEP, headed by the former attorney general, had reassured him every step of the way that it was a legitimate operation—right up, that is, until the arrests.
The agents had their perps and their first big witness, but continued to be stumped by their motive. Multiple FBI searches in the days after the burglary had found no listening devices in the DNC at all; no bug on Spencer Oliver’s phone nor one on the phone of Larry O’Brien, which made some wonder if the burglars had actually been removing the bugs—not installing them. The FBI agents found Baldwin’s almost ludicrous explanation of his recruitment and employment strangely reassuring. Given the burglars’ backgrounds, they’d continued to wonder whether the D.C. police had intercepted a rogue CIA mission, but Baldwin’s tale—which wouldn’t be publicly known until the fall—seemed consistent with the idea that they were, indeed, investigating just a “third-rate burglary” and not a sophisticated covert op. “He gave us some very valuable evidence,” recalled prosecutor Earl Silbert. “He became a critical government witness.”
By July 12, thanks to Baldwin, Gleason, Hoback, and others’ testimony, the FBI believed it was ready to arrest Hunt and Liddy for masterminding the break-in. Instead, however, Silbert and the two other prosecutors assigned to the case, Seymour Glanzer and Donald Campbell, asked the bureau to wait and let the Justice Department continue with a grand jury indictment.VI
With the grand jury, the prosecutors decided to zero in on just two aspects, the burglary and wiretapping at the Watergate—an approach the FBI team found annoyingly narrow, given all the other tantalizing leads about misdeeds and misappropriated money they were stumbling upon.VII In a lengthy summary of its investigation assembled on July 21, the FBI warned that it had been told by CREEP staffers that the campaign’s leadership was systematically keeping the truth from investigators and sending bureau agents on irrelevant “fishing expeditions” meant to distract them, but the depth of the cover-up was already even more worrisome than investigators realized. CREEP treasurer Hugh Sloan resigned quietly in mid-July, appearing to realize for the first time the true shadiness of some of the practices and people he’d been working alongside over the previous year.
Now, without him and Liddy, Magruder sought out Bart Porter, who headed the campaign surrogate program, and explained that he needed help making the cover story stick. “Your name was mentioned as someone we could count on,” Magruder said. CREEP’s strategy was to pretend that the sums of money given to Liddy were reasonable given the aboveboard, respectable programs he was supposed to have been working on. Would Porter be willing to tell the grand jury that the money given to Liddy had helped finance surrogate operations and protect against radical demonstrators?
“I need some time to think about that, Jeb,” Porter replied, though in the end, he agreed, and together they formed a plan: CREEP would admit to and apologize for shoddy bookkeeping—who knew that Sloan could just hand out cash money like that without documentation or receipts!—but maintain that it had nothing but the best of intentions for Liddy’s operations, armed with an outline of legitimate and logical security projects that they thought Liddy had been pursuing on the campaign’s behalf.
Despite the new cover story, Magruder fretted. “I was beginning to sense that I was in a very lonely and vulnerable position,” he recalled. When interviewed by the FBI in late July, he played as dumb as he could, telling the agents that McCord was just acting as a “soldier of fortune” and any legitimate political operative would know that “real information of value” would come from a campaign headquarters, not the party headquarters. In the final paragraph of the agents’ notes of the encounter, they wrote, “MAGRUDER explained that the $250,000 authorization which he had made for intelligence gathering was justified… [by] the information which LIDDY had furnished regarding the San Diego convention site.”
Kleindienst, the attorney general, Petersen, the head of the criminal division, and Gray, the FBI director, all seemed content to accept the cover story at face value. Through the summer, witness after witness paraded through the grand jury, as subpoenas rained down on everyone from Liddy to Stans, but few cracks appeared in the case, and under pressure from Petersen and Kleindienst, the prosecutors didn’t seem inclined to push further. Throughout, the department’s leadership seemed overly deferential to the campaign and White House officials, allowing them to testify in private rather than before the grand jury, among other accommodations. “My own feeling was that Henry didn’t want to make a fight,” Silbert said later.
Gray at one point even brought Felt and other FBI leaders into his office to ask whether the case could stop at the five burglars, plus Hunt and Liddy. “Can the investigation be confined to these seven subjects?” the acting director asked.
“We do not have all the evidence yet, but I am convinced we will be going much higher than these seven,” Felt said. “These men are the pawns. We want the ones who moved the pawns.”
Gray’s reticence to move beyond the initial conspiracy targets made Felt believe the department’s leadership was guilty of “silent obstruction,” leaving only one path to push the investigation through—the press.
I. Hunt’s biographer, Tad Szulc, would write that the onetime CIA officer’s post-burglary behavior was “a story of deceit, lies, blackmail, and disloyalty toward virtually everybody with whom he had been associated.”
II. Whether these payments—both living expenses and legal fees—were “hush money” versus merely payment due for services rendered would become a fierce point of contention in the months ahead.
III. John Dean’s own memoir Blind Ambition fails to mention any of the three conversations he had with Vernon Walters about pressuring the CIA to pay hush money to the burglars. In fact, Walters’s name doesn’t even appear in Dean’s book at all. Dean did speak of the meetings, though, before the Ervin Committee.
IV. Dean, notably, would tell the Senate Watergate Committee that permission to use campaign funds came from Mitchell during a meeting on June 28; the meeting, apparently, never happened. Later investigations would turn up that Mitchell was actually in New York on the day Dean says they met to plot the hush money.
V. “I didn’t trust Dean at all. He was going to park himself in the most secured area he could find and deceive anybody he had to in order to save his hide.” Perhaps true to Ulasewicz’s impression, Dean denies that using the private investigator was his idea—he says Kalmbach recommended Ulasewicz.
VI. As Silbert recalled, “In our view, [Liddy] and Hunt considered themselves James Bond types, super sleuths and big macho-male types.”
VII. Frank Wills, the office security guard, was shocked to enter the grand jury hearing and find a veritable sea of Black faces staring back at him. “Man, I never was so surprised in my life,” he recalled. “Most of the members of the jury were Black. I couldn’t count five white persons in the room.”
Chapter 18 The Dahlberg Check
By the end of July, as the prosecutors settled on a narrow investigation, it seemed clear that whatever other dirty laundry might be hidden amid the president’s reelection campaign would likely remain that way until at least November. The election would continue, and votes would be cast with no knowledge that anything unbecoming had unfolded in the midst of the campaign, much less that a bizarre local D.C. burglary potentially had ties to the Oval Office—until July 22, when the story roared back to life. That morning Newsday reported that Liddy had been fired from the campaign for refusing to cooperate with investigators. Later that week, the New York Times heightened the drama when it broke a major new revelation on its front page from one of its White House writers, Walter Rugaber.
Rugaber, a savvy young political journalist, had been suspicious of the Watergate operation as soon as he heard that CREEP’s security director was involved. “From the moment McCord was identified I was confident it could not be anything but a Nixon operation,” he said later. Rugaber had come to the D.C. bureau in 1969 after covering the Civil Rights Movement in Georgia and Alabama, and found covering the White House beat “just dreadful.” The Nixon team was secretive and iced him out even before the Times imbroglio over the Pentagon Papers, leaving him to get scrappy to find information. This ultimately benefited his reporting, when he realized that the key to unraveling the burglars’ story would be found in Miami. His colleague Tad Szulc had already tried with a run of stories focusing on the Cubans’ CIA connections, but Rugaber doubted that angle actually amounted to much. After Szulc’s trail went cold, Rugaber set out to uncover the paper trail he assumed might link the Cubans to Nixon’s orbit.
Early in July, he flew to Florida to dig around, striking up an odd alliance with Richard Gerstein, the Democratic state’s attorney in Miami’s Dade County, who was personally and professionally curious whether the Watergate plot had roots in his jurisdiction. The reporter’s hunch mixed with the subpoena power of a prosecutor made for a powerful combination. Gerstein gathered Barker’s phone records, and Rugaber took to calling each number in turn; he knew he’d struck pay dirt when one call was answered: “Committee for the Reelection of the President?”
On July 25, the New York Times published Rugaber’s first report that Barker’s Miami phone had called the CREEP offices more than a dozen times from March to June—specifically dialing an extension that reached the office Liddy shared with another lawyer, Glenn J. Sedam, Jr. When the Times asked Sedam about it, he denied speaking with Barker, presumably meaning that Liddy had been the intended recipient. One call to Liddy’s office from Barker’s phone had come the day before the break-in. Reached at home, Liddy told the paper he would have “no conversation with the press on any subject at all.”
Rugaber’s scoop spurred the Washington Post to reassemble their Watergate team—managing editor Howard Simons, annoyed, cornered city editor Barry Sussman with the Times in hand and demanded, “Why didn’t we have that?”I And by the end of the day, Woodward and Bernstein were back on the beat until further notice—though in its own way, the assignment of two young, inexperienced reporters amid a newsroom filled with respected veterans still indicated how little attention the Post expected to get out of the scandal.
Bernstein immediately wanted to start digging into the money trail too. He reached out to Gerstein, and on his own made arrangements to visit Miami. On July 31, he boarded a plane to Florida and opened his morning copy of the Times to find Rugaber’s latest scoop, datelined from Mexico City: “Cash in Capital Raid Traced to Mexico.” Investigators, Rugaber revealed, had traced the burglars’ sequential $100 bills to two bank withdrawals by Barker in Miami, on May 2 and 8, that totaled $89,000. The withdrawals matched precisely the total amount of four deposits Barker had made earlier, on April 20, of bank drafts from Banco Internacional in the amounts of $15,000, $18,000, $24,000, and $32,000, all of which appeared to come from a prominent Mexican corporate lawyer, Manual Ogarrio Daguerre.
Bernstein called back to the Post newsroom as soon as he landed and asked Sussman whether he should head to Mexico City. In what Bradlee’s biographer Jeff Himmelman would call “arguably the most important decision made by any Post editor during the initial phase of Watergate,” Sussman told Bernstein to stay in Miami and dig into what he could find there.II The reporter spent the rest of the day trying to coax information out of the state’s attorney; he ultimately not only confirmed that the four checks were exactly as described in the Times, but also learned of a fifth check, from someone named Kenneth H. Dalhberg, for $25,000, that Barker had also deposited.
Gerstein’s investigators hadn’t been able to figure out who Dalhberg was, but some guesswork and archival research by Woodward, Bernstein, and the Post’s librarians managed to identify him. Dahlberg, they determined, lived in Minneapolis and had headed the ’68 Nixon campaign’s efforts in the Midwest. Dahlberg seemed baffled how his check had ended up in the Miami bank account of a Watergate burglar. “I don’t have the vaguest idea about it,” he told Woodward over the phone. “At a meeting in Washington of the committee, I turned the check over either to the treasurer of the committee [Hugh W. Sloan, Jr.] or to Maurice Stans himself.” It seemed that the president’s reelection money had somehow been laundered through Barker’s account in Miami.III The article ran in the next day’s paper under what would soon be the most famous dual byline in journalism.
Until then, Woodward and Bernstein had been all but competing with each other, each keeping his own hunches, scoops, and sources under wraps, not trusting that the other wouldn’t run with the story and steal credit. As they pursued Dahlberg, though, Woodward requested that Bernstein’s byline also be featured, despite him being in Miami, and all future Watergate stories would be co-bylined. Colleagues soon came to see a pattern in the duo’s style: Woodward would tear speedily through a first draft of a story to establish the basic facts and outline, then Bernstein, the better writer, would work it through to a more polished version. They would argue—loudly—in the newsroom over individual word choices and phrasing, arguments that regularly grew so heated that one or the other would throw up his hands and walk away. Their finished drafts always seemed to arrive at the last minute before deadline.
The Dahlberg story marked one of the first moments in the Post’s coverage when the paper broke new revelations and moved the story forward, rather than just following leads already developed by government investigators or another paper. Based on the reports about the Dahlberg check, the federal elections division of the government’s watchdog, the Government Accounting Office (GAO), began an audit of the Nixon campaign, the first ever carried out as part of the new federal campaign finance law that had taken effect on April 7.
* * *
Publicly, the White House continued to project an attitude of genial cooperation with investigators throughout the summer. “The President’s view is that all those who are asked to cooperate should cooperate,” Deputy Press Secretary Gerald Warren told reporters in early August. But in the Oval Office and the Executive Office Building, Nixon’s team spent that month concocting an elaborate series of lies, suborning perjury, and constructing half-truths to obfuscate the campaign’s darkest corners. Though Nixon was still confident in the efforts thus far to stonewall the case (“I’m not that worried about it, to be perfectly candid with you,” he told Haldeman on August 1. “After all, Mitchell’s gone, and as we’ve all pointed out, nobody at a higher level was involved”), he spoke openly to Haldeman of the “considerable cost” of keeping Hunt quiet. “They took a hell of a risk and they have to be paid,” the president lamented. “That’s all there is to that.” The hush money was worth every penny, and they just had to hold strong.
In mid-August, Magruder was called before the grand jury. Heading into the testimony, it seemed highly likely that the deputy campaign director would be indicted (and he would have been had he told the truth), but on August 15, he and Dean met in the White House counsel’s office to prepare his answers. There had been more and more stories spreading about Liddy and his antics, and the White House was trying to make clear Liddy acted alone without prompting the former aide to reconsider his silence. Magruder paced as Dean tested him and rehearsed for three hours with the toughest questions he might face from prosecutors.
As it turned out, Dean’s questioning was tougher than that by the prosecutors. As Campbell sat off to the side, taking notes and doubling back to check facts, figures, and timelines, Silbert interrogated Magruder for two hours, seeming to Magruder to steadily lose steam and interest. Magruder emphasized how big and sprawling and expensive the Nixon operation was compared to Liddy’s tiny operation—sure, $250,000 might sound like a lot of money, but it wasn’t to CREEP—and he explained how the distraction of the ITT scandal had meant Mitchell’s campaign controls weren’t as tight as they should have been through the spring. All in all, he sold the cover story about Liddy’s legitimate activities and walked out of the grand jury apparently trouble-free. Dean kept in close—inappropriately close—contact with Henry Petersen, and the next day, Dean called Magruder to tell him that the campaign official was no longer a target. He had escaped; that night, Magruder got roaring drunk at Billy Martin’s Tavern in Georgetown with Fred LaRue.
