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Full text of "Presidential campaign activities of 1972, Senate resolution 60; Watergate and related activities"

J^ PRESIDENTIAL CAMPAIGN ACTIVITIES OF 1972 

\^ SENATE RESOLUTION 60 

EXECUTIVE SESSION HEARINGS 

BEFORE THE 

SELECT COMMITTEE ON 
PRESIDENTIAL CAMPAIGN ACTIVITIES 

OF THE 

UNITED STATES SENATE 

NINETY-THIRD CONGRESS 

SECOND SESSION 



WATERGATE AND RELATED ACTIVITIES 
Milk Fund Investigation 

WASHINGTON, D.C., JANUARY 9, 10, 25, 28, 31, FEBRUARY 5, 7, 
8, 20, 21, MARCH 11, 12, AND 13, 1974 

Book 16 




Printed for the use of the 
Select Committee on Presidential Campaign Activities 



TT q Gnvenirr>-nt Documents Depository 
^' ^ ' ■ ' - - library 




PRESIDENTIAL CAMPAIGN ACTIVITIES OF 1972 

SENATE RESOLUTION 60 



EXECUTIVE SESSION HEARINGS 

BEFORE THE 

SELECT COMMITTEE ON 
PRESIDENTIAL CAMPAIGN ACTIVITIES 



UNITED STATES SENATE 

NINETY-THIRD CONGRESS 

SECOND SESSION 



WATERGATE AND RELATED ACTIVITIES 
Milk Fund Investigation 

WASHINGTON, D.C., JANUARY 9, 10. 25, 28, 31, FEBRUARY 5, 7, 
8, 20, 21, MARCH 11, 12, AND 13, 1974 

Book 16 




Printed for the use of the 
Select Committee on Presidential Campaign Activities 



U.S. GOVERNMENT PRINTING OFFICE 
WASHINGTON : 1974 



For sale by the Superintendent of Documents, U.S. Government Printing Office 
Washington, D.C. 20402 - Price $4.15 



SENATE SELECT COMMITTEE ON PRESIDENTIAL 
CAMPAIGN ACTIVITIES 

(Established by S. Res. 60, 93d Congress, 1st Session) 



SAM J. ERVIN, JR., North Carolina, Chairman 
HOWARD H. BAKER, Jr., Tennessee, Vice Chairman 

HERMAN E. TALMADGE, Georgia EDWARD J. GURNEY, Florida 

DANIEL K. INOUYE, Hawaii LOWELL P. WEICKER, Jr., Connecticut 

JOSEPH M. MONTOYA, New Mexico 

Samuel Dash, Chief Counsel and Staff Director 

Fred D. Thompson, Minority Counsel 

RuFUS L. Edmisten, Deputy Chief Counsel 

Arthur S. Miller, Chief Consultant 

David M. Dorsen, Assistant Chief Counsel 

Terry F. Lenzner, Assistant Chief Counsel 

James Hamilton, Assistant Chief Counsel 

Carmine S. Bellino, Chief Investigator 

Marc Lackritz, Assistant Counsel 

James C. Moore, Assistant Counsel 

Ronald D. Rotunda, Assistant Counsel 

Barry Schochet^ Assistant Counsel 

W. Dennis Summers, Assistant Counsel 

Alan S. Weitz, Assistant Counsel 

Robert F. Muse, Jr., Assistant Counsel 

Mark J. Biros, Assistant Counsel 

R. Scott Armstrong, Investigator 

Michael J. Hershman, Investigator 

Donald G. Sanders, Deputy Minority Counsel 

Howard S. Liebengood, Assistant Minority Counsel 

Michael J. Madigan, Assistant Minority Counsel 

Richard L. Schultz, Assistant Minority Counsel 

Robert Silverstein, Assistant Minority Counsel 

Carolyn M. Andrade, Administrative Assistant 

Carolyn E. Cohen, Office Manager 

Joan C. Cole, Secretary to the Minority 

[Executive session hearings released to the public after the filing 
of the final report of the Senate Select Committee.] 



CONTENTS 



HEARING DAYS 

Page 

Wednesday, January 9, 1974 6937 

Thursday, January 10, 1974 69S3 

Friday, January 25, 1974 7059 

Monday, January 28, 1974 7085 

Thursday, January 31, 1974 7129 

Tuesday, February 5, 1974 7187 

Thursday, February 7, 1974 7229 

Friday, February 8, 1974 7373 

Wednesday, February 20, 1974 7403 

Thursday, February 21, 1974 7417 

Monday, March 11, 1974 7439 

Tuesday, March 12, 1974 7455 

Wednesday, March 13. 1974 7513 

CHRONOLOGICAL LIST OF WITNESSES 

Wednesday, January 9, 1974 

Masters, Franli D., attorney for AMPI, accompanied by Ronald R. Flake, 
counsel 6937 

Thursday, January 10, 1974 

Van Dyk, Ted, head of Ted Van Dyk Associates, a consulting firm, 

accompanied by Paul Warnke, counsel 6983 

Friday, January 25, 1974 

Alagia, Paul D., former executive director of Dairymen, Inc., accompanied 

by John T. Miller and John Young Brown, counsel 7059 

Monday, January 28, 1974 

Townsend, Thomas W., former .special assistant to the general manager of 
AMPI, presently director of .special projects for Mid-America Dairymen, 
Inc., accompanied by M. Randall Vanet, counsel 7087 

Arnold, Carl F., fundraiser for the Draft Mills campaign of 1972 7125 

Thursday, January 31, 1974 

Palmby, Clarence D., vice president of Continental Grain Co., accompanied 
by Arthur L. Lyman, counsel 7129 

Haldeman, H. R., former assistant to the President, accompanied by Frank 
H, Strickler, counsel 7155 

Tuesday, February 5, 1974 

Semer, Milton, member of the former firm of Semer & Jacobsen, which 
was retained by AMPI 7187 

Thursday, February 7, 1974 

Mehren, Dr. George L., general manager of AMPI, accompanied by Edwin 

C. Heininger, counsel 7229 

Friday, February 8, 1974 

Ehrlichman, John D., former chief domestic adviser to the President, ac- 
companied by John J. Wilson, counsel 7373 

(III) 



rv 

Wednesday, Febettaby 20, 1974 

Clancy, Lynda E., secretary for the Republican Senatorial Committee, Pase 
accompanied by John G. DeGooyer, counsel 7403 

Thursday, February 21, 1974 

Odell, Robert P., executive director, Republican National Finance Com- 
mittee, accompanied by John G. DeGooyer, counsel 7417 

Monday, March 11, 1974 

Morris, Dwight, former secretary of the board of AMPI 7439 

Tuesday, March 12, 1974 

Strachan, Gordon C, former staff assistant to H. R. Haldeman, accom- 
panied by John Bray, counsel 7455 

Wednesday, March 13, 1974 

Paarlberg, Dr. Don, Director, Agricultural Economics, Department of 
Agriculture 7513 

EXHIBITS SUBMITTED FOR THE RECORD 
Masters Exhibits 

No. 1— (6943) Check for $6,840 to Mr. Masters from Associated Milk 
I'roducers, Inc., dated January 6, 1970, with 
invoice 6973 

Nos. lA through IC — (6944) Billings for months of August, September, 

and October 1969, respectively 6974-6980 

No. ID— (6968) List of States and amount charged for legal 

services 6981 

No. 2 — (6947) Check to Frank Masters from Milk Producers, Inc., 

for $5,000, dated December 19, 1969 6982 

No. 3— (6947) Check for $5,397.96 to Frank Masters from Milk Pro- 
ducers, Inc., dated December 2, 1969 6982 

No. 4 — (6950) Check to Frank D. Masters from Associated Milk 
Producers, Inc., for $7,379.78, dated January 23, 

1970 6982 

Van Dyk Exhibits 

No. 1— (6999) Check for $12,000 made out to Kirby Jones for AMPI 
project, dated September 11, 1970, and signed by Ted 
Van Dyk 7043 

No. 2— (6999) 1970 tax forms W-2 and 1099 for Kirby Jones from 

Ted Van Dyk Associates, Inc 7044 

No. 3— (7002) Kirby Jones check to Bob Lilly for $10,000 dated Sep- 
tember 9, 1970 7045 

No. 4 — (7003) Ted Van Dvk Associates cheek to Public Opinion Sur- 
vey, Inc., for $12,000, dated December 16, 1970 7045 

No. 5 — (7003) Statement from Gallup Organization, Inc., to Ted Van 

Dyk Associates for professional services, $12,000 7046 

No. 6— (7003) AMPI check to Ted Van Dyk Associates for $19,573.08, 

dated December 11, 1970, with attached statement-- 7047 

No. 7— (7007) Statement to Ted Van Dyk from Charles Mickel dated 
September 16, 1971, for professional services, $2,- 
999.85 7049 

No. 8— (7008) Check to Ted Van Dyk Associates from AMPI for 

$2,500 dated August 7, 1970, with attachment 7050 

No. 9 — (7008) AMPI check to Ted Van Dyk Associates for $10,035.28 

dated June 12, 1970, with attachments 7052 

No. 10^(7013) AMPI cover letter to Ted Van Dyk enclosing t^^o 
checks for Muskie campaign, $1,750 and $1,650, 
dated July 24, 1970, signed by Stuart Russell 7055 

No. 11 — (7015) Letter concerning Muskie campaign contribution from 
Stuart Russell to Muskie Election Committee dated 
November 24, 1970 7057 

No. 12 — (7016) Letter from Senator Muskie to Harold Nelson ac- 
knowledging summary of contributions 7058 

Note. — Figures in parentheses indicate page tliat exhibit was made part of the record. 



Palmbt Exhibit 

No. 1 — (7134) Letter from Clarence Palmby to Patrick Healy dated 
March 9. 1971, discussing dairy price-support level. 
Also February 12, 1971, letter from Patrick Healy to 
Clifford Hardin urging early announcement of milk Pase 

price support 7152 

Semeb Exhibits 

No. 1 — (7187) Executive session opening statement of Milton P. Semer, 
February 8, 1974, with three AMPI letters signed by 
George Mehren to Alan Weitz of the Select Commit- 
tee, dated October 31, November 2, and November 13, 

1973 7219 

No. 2 — (7208) Page from service calendar dated September 16, 1969__ 7224 
No. 3— (7208) White House letter to Milt Semer from Jack Gleason, 
dated September 16, 1969, discussing advisory board 

positions at Department of Agriculture 7225 

No. 4 — (7209) Note on page of service calendar : "Bob Lilly — Nov. 20, 

VP— Dairymen's Inc. Letter to Stan Blair." 7226 

No. 5 — (7217) Letter from Senator Muskie to Stuart Russell dated 
December 22, 1970, expressing appreciation for help 

and encourage , 7227 

Mehren Exhibits 

No. 1-A — (7262) Cover letter from Stuart Russell to Erwin C. Hein- 
inger, dated February 28, 1972. Subject : Depart- 
ment of Justice complaint 7349 

No. 1-B — (7262) Letter from Marion Harrison to Stuart Russell 
dated February 25, 1972, re United States v. 

AMPI 7351 

No. 1-C — (7262) Letter from Marion Harrison to George Mehren 
dated February 25, 1972, re United States v. 

AMPI 7352 

No. 2— (7282) Previously entered as Lilly exhibit No. 30. See Book 14, 

page 6191. 
No. 3— (7290) Minutes, Committee for TAPE meeting, October 11, 

1972, Minneapolis Minn 7353 

No. 4 — (7300) TAPE expenditure voucher, with attached letter from 
George Mehren to Hon. Peter Dominick, dated Octo- 
ber 24, 1972, accompanied by check for $150,000 to 
National Senatorial Campaign, and receipt for same_ 7354 
No. 5 — (7300) TAPE expenditure voucher. Letter from George 
Mehren to Hon. Bob Wilson, dated October 24, 1972, 
accompanied by check for $1.50,000 to National Re- 
publican Congressional Campaign, and receipt for 

same 73.58 

No. 6 — (7300) TAPE expenditure voucher. Letter from Bob Lilly to 
Buehl Berentson dated October 27, 1972, accom- 
panied by check for $27,500 to National Republican 

Senatorial Campaign, and receipt for same 7362 

No. 7— (7300) TAPE expenditure voucher. Letter from Bob Lilly to 
Ed Terrell, dated October 27, 1972. accompanied by 
check for $25,000 to National Republican Campaign 

Committee, and receipt for same 7365 

No. 8— (7307) Check from AMPI for $66,321.48 to Stuart Russell 
dated April 18, 1972. with voucher and request for 

check 7368 

Clancy Exhibits 

No. 1— (7408) Check to Republican Campaign Committee for $65,000 

dated October 30, 1972, with endorsement 7414 

No. 2— (7408) Check to Republican Campaign Committee for $.55,000 

dated November 7, 1972, with endorsement 7415 

Note. — Figures in parentheses indicate page that exhibit was made part of the record. 



Odell Exhibits 

No. 1 — (7418) Three checks to the Republican Campaign Committee 
with dates and amounts as follows : October 31, 1972, 
$95,000; November 3, 1972, $6,000; November 20, Page 

1972, $2,000; endorsements included 7432 

No. 2— (7422) Two checks of $100,000 each to the Finance Committee 
To Re-Elect the President, dated November 7 and 

November 13, 1972 7434 

No. 3 — (7426) Memorandum from Gordon Strachan to H. R. Halde- 
man dated September 24, 1971. Subject: "Milk 

money" 7435 

No. 4 — (7429) Letter from Maurice Stans to Mrs. Albert Swanke 
dated September 26, 1972, re : distribution of cam- 
paign funds 7436 

Morris Exhibit 

No. 1 — (7447) U.S. Senate Select Committee on Presidential Cam- 
paign Activities questionnaire and cover letter 7451 

Strachan EIxhibits 

No. 1 — ^(74;>5) Letter from John Bray to David Dorsen dated March 

12, 1974, re immunity for Gordon Strachan 7472 

No. 2 — (7456) Note from Charles Colson to Gordon Strachan, dated 

Mra-ch 17, 1971 7473 

No. 2- A — (7456) Memorandum from H. R. Haldeman to Chuck Col- 
son dated February 2, 1971, re note from Bob 

Dole 7474 

No. 2-B — (7456) Memorandum from Charles Colson to H. R. Halde- 
man dated February 1, 1971. Subject: Outside 

fund handling 7475 

No. 2-C — (74.56) Memorandum for Larry Higby from Charles W. Col- 
son dated February 2, 1971, concerning fund- 
raising 7476 

No. 2-D— (7450) One-line notation: "CWC wants the return of this 

file." 7476 

No. 2-E — (745G) Memorandum for H. R. Haldeman from Charles 
Colson dated February S, 1971, re support from 

milk producers 7477 

No. 3 — (74.59) White Hou.se memoraiulum from Gordon Strachan to 
H. R. Haldeman dated May 21, 1971. Subject: Kalm- 

bacb telephone call of May 21 7478 

No. 4 — (7461) Memorandum from Gordon Strachan to H. R. Halde- 
man dated September 11, 1971. Subject : Milk money. 7483, 
No. .5 — (7463) Gordon Strachan memorandum for H. R. Haldeman 
dated September 16, 1971, also discussing "milk 

money" 7484 

No. 6 — Previou.sly entered as Odell exhibit No. 3. See book 16, page 

7435. 
No. 7 — (7464) Memorandum from Charles Colson to H.R. Haldeman 
dated September 24, 1971. re milk producers, with 
attachment. Also memorandum from Gordon 
Strachan to H. R. Haldeman dated September 28, 
1971. Subject: "Milk money," with articles from 
the Wall Street .Tournal and the Washington Post- 7485 
No. 8 — (7465) Memorandum from .Tohn Dean to Gordon Strachan 
dated Octol»er 6, 1971. Subject : Antitrust exemp- 
tion for Milk Producers Cooperative 7499 

No. 9 — (7466) Gordon Strachan memorandum to H. R. Haldeman 
dated Novemlter 3, 1971. re agenda for the At- 
torney General, with attachment 7500 

No. 10 — f7467) Memorandum from Gordon Strachan to H. R. Halde- 
man dated January 18, 1972, re Herb Kalmbach to 

handle the milk money 7.502 

No. 11— (7468) Memorandum from Gordon Strachan to H. R. Halde- 
man dated February 1, 1972. ro Kalmbach's con- 
cern with milk producers' situation 7.503 

Note. — Flj;ures in parentheses indicate page that exhibit was made part of the record. 



VII 

Strachan Exhibits— Continued 

No. 12 — (7469) Gordon Strachan memorandum to H. R. Haldeman 

dated February 16, 1972, re Kalmbach and the Page 

milk producers 7504 

No. 13 — (7470) Memorandum from John Dean to H. R. Haldeman 

dated February 1, 1972. Subject : Nader v Butz 7505 

No. 14 — (7470) John Dean memorandum to H. R. Haldeman and 
John Ehrlichman dated August 31, 1972 ; also con- 
cerning Nader v. Butz 7510 

Paaelbebq Exhibits 

No. 1 — (7529) Table showing Government expenditures on dairy sup- 
port and related programs, 1950-73 7532 

No. 2 — (7531) Table showing milk production, utilization, and 

USDA purchases 7533 

Note.— Figures in parentheses indicate page that exhibit was made part of the record. 



PRESIDENTIAL CAMPAIGN ACTIVITIES OF 1972 
MILK FUND INVESTIGATION 



WEDNESDAY, JANUARY 9, 1974 

U.S. Senate, 
Select Committee on 
Presidential Campaign Activities, 

Washington^ D.C. 
The Select Committee met, pursuant to notice, at 9 a.m. in room 
G-334, Dirksen Senate Office Building. 
Present : Senator Lowell P. Weicker. 

Also present: David Dorsen, assistant chief counsel; Alan Weitz, 
assistant majority counsel; and Donald Sanders, deputy minority 
counsel. 

Swearing In of Ted van Dyk 

Senator Weicker. Do you want to raise your right hand? Do you 
swear the testimony you are about to give the committee is the truth, 
the whole truth, and nothing but the truth, so help you God? 

Mr. VAN Dyk. I do. 

Mr. Weitz. I^t the record show the executive session hearing of Mr. 
van Dyk will be recessed to Thursday, January 10, 1974. 

[Recess.] 

Senator Weicker. Eaise your right hand. Do you swear the testi- 
mony you are about to give the committee is the truth, the whole truth, 
and nothing but the truth, so help you God ? 

TESTIMONY OF FRANK B. MASTERS, ACCOMPANIED BY RONALD R. 
FLAKE, COUNSEL 

Mr. Masters. I do. 

Mr. Weitz, Would counsel identify himself for the record? 

Mr. Flake. I am Ronald R. Flake, D-302, Petroleum Center, San 
Antonio, Tex. 

Mr. Weitz. Mr. Masters, for the record would you please state your 
full address? 

Mr. Masters. Yes. 

Frank Masters, D-302, Petroleum Center, San Antonio, Tex. 

Mr. Weitz. Mr. Flake, could you identify the firm ? 

Mr. Flake. Yes; I am Ronald R. Flake; I am with the firm of 
Masters and McManus at that same address. 

Mr. Weitz. Mr. Masters, from the period 1969 forward, could you 
identify the firm or professional organization with which you have 
been affiliated, please, from 1969 forward ? 

(6937) 



6938 

Mr. Masters. Well, I was a sole practitioner the first part of the 
period. Then I organized a firm with James F. Gardner and Pat 
Thomas. 

Mr. Weitz. Approximately when was that orjjanized? 

Mr. Masters. Sometime in 1970. 

Mr. Weitz. Wliat was the name of that firm ? 

Mr. Masters. Masters, Gardner and Associates. Then after that I — 
Mr. Gardner and I terminated our firm and I formed tlic firm of Mas- 
ters and McManus. 

Mr. Weitz. I believe at one jioint between the time yon were affili- 
ated with Mr. Gardner and the time Masters and McManns was 
formed you practiced as Frank T). Masters and Associates? 

Mr. Masters. Correct, Correct. 

Mr. Weitz. Now, thronofhont the period from IDBO forward, and 
preyioiis to that for some period of time, were yon retained by, first, 
Milk Producers Associated, MPI, and Associated Milk Producers, 
AMPI? 

Mr. Masters. I don't know what you mean by retained. I recommend- 
ed them, yes. I was never on retainer. 

Mr. Weitz. Never on retainer. Wlien did you first represent MPI ? 

Mr. Masters. ^Vhen it was formed. 

Mr. Weitz. In 1967? 

Mr. MavSters. Yes. 

Mr. Weitz. And you continued to represent MPI and its successor, 
AMPI, in various matters since that time? 

Mr. Masters. Yes, sir. 

Mr. Weitz. You still represent them ? 

Mr. Masters. Yes, sir. 

Mr. Weitz. You say you or your firm at one point or another were 
not on a retainer basis. "\'Vniat was the fee arrangement with AMPI ? 

Mr. Masters. Just billed them for work done. 

Mr. Weitz. With whom did you have direct contact in being asked 
to represent AMPI ? 

Mr. Masters. No one person in particular. I represented several of 
its constituent organizations. 

Mr. Weitz. Mr. Nelson, for example — did you have dealings with 
him? 

Mr. Masters. Yes. 

Mr. Weitz. Did he originally ask you to represent them ? 

Mr. Masters. Well, I represented South Texas Producers Associa- 
tion, North Texas Producers Association, San Antonio, Coastal Bend. 

Mr. Weitz. These were all dairy cooperatives. 

Mr. Masters. Yes. And when they started forming MPI, they asked 
me to come to the organizational meeting. It could have been Nelson or 
it could have been somebody else, with some of the other co-ops there. 
All of them were there. 

Mr. Weitz. Now, in general, what type of work have you done for 
them, just as a general matter? 

Mr. Masters. Oh, a little bit of everything, I suppose. The nuts and 
bolts, the every day organization. Just every day law practice, law 
matters that came up. 

Mr. Weitz. Primarily in Texas? 



6939 

Mr. Masters. No. Well, I giiess you could say primarily in Texas, 
but it took me all over the country, in every State that we did business. 

Mr. Weitz. In addition to Mr. Nelson, have you in the course of 
representing AMPI. had some contact with Dave Parr ? 

Mr. Masters. Yes. 

Mr. Weitz. What was the nature of those contacts, in connection 
with the representation of them in these various matters? 

Mr. Masters. Well, I attended all of the board meetings, and they 
were usually — they were regular board meetings. 

Mr. Weitz. Wliat about Bob Lilly ? Have you had contact with him 
in the course of representing AMPI? 

Mr. Masters. Yes. 

Mr. Weitz. "WHiat would be the nature or reason for those contacts? 

Mr. Masters. Oh, just in the general run of everyday business. 

Mr. Weitz. How frequently do you estimate on, let's say, a monthly 
or annual basis that you have had contact, over the last several years, 
with Mr. Nelson, either by telephone or in person? 

Mr. Masters. Oh, it would vary. Sometimes very often; sometimes 
only at the board meetings. 

Mr. Weitz. Wiat about Mr. Lilly ? 

Mr. Masters. Same way with Bob Lilly. 

Mr. Weitz. Mr. Lilly has been described as having substantial re- 
sponsibility in political areas. Have you had any dealings with him 
that dealt with political matters with regard to AMPI? 

Mr. Masters. No. 

Mr. Weitz. What about the formation or the operation of TAPE 
or its successor. Committee for TAPE? Have you had any dealings 
or matters in which you have been involved in TAPE or its formation 
or its operation ? 

Mr. Masters. No. I wasn't involved in the formation of TAPE. 
I didn't represent them. 

Mr. Weitz. Have you ever been asked or have you ever provided 
any counsel or advice with respect to the operation of TAPE or any 
contributions by TAPE ? 

Mr. Masters. No. It was my understanding they were represented 
by Washington counsel. 

Mr. Weitz. Do you know who that was ? 

Mr. Masters. No. sir, I don't. 

Mr. Weitz. Was it one Washington counsel or others? Do you know 
how many other lawyers they had retained on a regular basis, re- 
tained or had represented them on a regular basis over the last 4 years ? 

Mr. Masters. No. 

Mr. Weitz. Did you know of any others ? 

Mr. Masters. No. The only thing I knew, as to the representation 
of TAPE, was that it was — they had Washington counsel. 

Mr. Weitz. What about AMPI ? "VYliat other lawyers did you know 
during the period 1969 to 1972 that represented AMPI for one purpose 
or another? 

Mr. Masters. Oh, let's see. Stuart. Russell, one in Minneapolis. I 
can't recall his name. A firm here in Washington, Sidney Harris. I 
don't recall the firm name right offliand. One particular lawsuit we 
had^ — New York's Sidney Berde. Sidney Berde. Sidney Harris, myself, 
Stuart Russell, Joe Long, and 



6940 

Mr. Weitz. Is that the Joe Long wlio is a partner of Jake Jacobsen? 

Mr. Masters. Yes. This was in the first antitrust suit that was filed 
in the late sixties. Then they had a patent firm here in Washinolon, 
did some patent work for MPI. 

Mr. Weitz. You mentioned Sidney Berde. Is that a firm or a practi- 
tioner, in Washinffton or in • 

Mr. Masters. No ; he is in Minneapolis. 

Mr. Weitz. That is the Minneapolis firm yon are referring to? 

Mr. Masters. Yes ; I think Sidney is a sole practitioner. 

Mr. Weitz. I see. And Sidney Hari-is that you referred to who 
practices in Washington, that would be distinct from the Washington 
firm that you think represented TAPE ? 

Mr. Masters. Correct. Then, let's see. As the names come to me, 
George St. Peter, in Wisconsin. We had another firm in Madison. 
The name escapes me. 

Mr. Weitz. All right. Perhaps we can come to it as we come to 
particular individuals. 

Did there come a time in late 19<)9, when Bob Lilly came to you and 
asked for some money for some political purpose ? 

Mr. Masters. Yes. 

Mr. Weitz. Could vou tell us about that, please ? 

Mr. Masters. Well, Bob came to me and wanted to — suggested that 
I make some contributions to Austin. He thought that would be an 
opportune time, at that time, to make some. 

Mr. Weitz. And was this the first time he had ever approached you 
with that type of request? 

Mr. Masters. Yes. 

Mr. Weitz. Or for any request for political contributions from you? 

Mr. Masters. I think so. 

Mr. Weitz. Did he say how much he expected or thought or sug- 
gested that you contribute ? 

Mr. Masti:rs. Well, he said he thought I should make a substantial 
contribution, enough, I believe, to get their attention. 

Mr. Weitz. What did you understand him to mean or did he amplify 
what he meant by Austin ? 

Mr. Mastp:rs. Austin, Tex. 

Mr. Weitz. I understand that, but what did he mean by that or what 
did you understand liim to mean by that? 

Mr. Masters. State Democratic Party. 

Mr. Weitz. You were aware at the time that Mr. Lilly had been 
politically active in Texas? 

Mr. Masters. Yes. 

Mr. Weitz. Were you aware whether or not he had been politically 
active outside of Texas? 

Mr. Masters. No. I knew that he was very politically active in 
Austin. 

Mr. Weitz. Did he tell you why he had chosen that time or those 
circumstances to suggest that you make a contribution ? 

Mr. Masters. No. 

Mr. Weitz. Was it really a suggestion or was he telling you that he 
wanted you to give him some money ? 

Mr. Masters. Well, I would call it a suggestion. 

Mr. Weitz. And your understanding was that it was to assist your 
law practice ? 



6941 

Mr. Masters. For my benefit. 

Mr. Weitz. For your benefit ? 

Mr. Masters. Yes. 

Mr. Weitz. Do you have any understanding as to why he came to 
you to make the suggestion to benefit you ? 

Mr. Masters. He said tliat if I was going to make any, that this 
would be the time to make it, that they needed the money and a dollar 
would do double duty or go further, something like that. 

Mr. Weitz. Did he indicate who he meant by "they" ? 

Mr. Masters. State Democratic hierarchy. 

Mr. Weitz. Did he indicate wliether he had conferred with Mr. Nel- 
son or anyone else at AMPI before coming to see you ? 

Mr. Masters. No. 

Mr. Weitz. When was this, December 1969 ? Do you remember that? 

Mr. Masters. Not that I can nail it down. It was the latter part of 
1969, to the best of my recollection. 

Mr. Weitz. Did he indicate or did you understand that the conse- 
quences — any consequences if you failed to honor his suggestion ? 

Mr. Masters. No. 

Mr. Weitz. You didn't feel at tlie time that there would be any 
adverse business consequences with regard to AMPI or any other 
clients if you didn't give liim the money ? 

Mr. Masters. No. 

Mr. Weitz. Did he indicate that he needed the monejr, that he was 
committed in some way or that AMPI was committed in some way ? 

Mr. Masters. Alan, he may have indicated that he himself was com- 
mitted. It has been so long ago — he well may have. 

]\Ir. Weitz. Did you discuss with him or did he raise the possibility 
of being repaid for those payments by either AMPI or anyone else? 

Mr. Masters. No. 

Mr. Weitz. Did he ever discuss with you at that time or later 

Mr. Sanders. Did Mr. Masters indicate negatively ? 

Mr. Weitz. He said "No." 

Mr. Saxders. I am sorry. I didn't hear him. 

Mr. Weitz. Now, you say Lilly may have indicated he had made 
or was subject to some commitment. Did he say how much money 
he needed, either from you or in total from anybody else ? 

Mr. Masters. No. He just told me to give enough to get their 
attention. 

Mr. Weitz. Did he indicate 

Mr. Masters. He suggested that I should — that he thought I 
should — if I was going to give anything, it should be a substantial 
sum. 

Mr. Weitz. What did you understand that to be ? 

Mr. Masters. Several thousand dollars. 

Ml-. Weitz. Did he indicate whether he had talked to anyone else 
or made any similar suggestion to anyone else, any other lawyers or 
anvone else connected with AMPI ? 

Mr. Masters. Not that I recall. 

Mr. Weitz. This was in the latter part of 1969. Did you at that 
time — were you aware of any contributions that either TAPE or 
AMPI had made in 1969? 

Mr. Masters. No, sir. 



6942 

Mr. Weitz. . Were you aware of any commitments for any sub- 
stantial contributions which either AMPI or TAPE had made in 
1969? 

Mr. Masters. No, sir. 

Mr. Weitz. Did Mr. Lilly discuss with you the form of the pay- 
ment from you ? In other words, cash, check or otherwise ? 

Mr. Masters. Yes. Cash. 

Mr. Weitz. Did he explain why it was to be in cash ? 

Mr. Masters. No. 

Mr. Weitz. Had you ever made any cash contributions, political 
contributions, prior to that time, of, say, over $100 ? 

Mr. Masters. Yes. I had made cash contributions before but I 
coundn't tell you Avhether they were under or over. 

Mr. Weitz. Were they as much as several thousand dollars in the 
amount you understood Mr. Lilly was asking for? 

Mr. i\f ASTERS. No. 

Mr. Weitz. Did you ask him why he wanted it in cash, why it 
couldn't be by check ? 

Mr. Masters. No. I don't recall asking him. 

Mr, Weitz. Did you discuss whether or not these contributions were 
to be made in such a way so they couldn't be detected or reported? 

Mr. Masters. No. Bob had been around Austin for many years. I 
felt he knew Avhat he was doing and how to do it properly, correctly. 

Mr. Weitz. Did he indicate what election or what — well, what elec- 
tion or campaigns these moneys would go to ? 

Mr. Masters. I don't believe he did. 

Mr. Weitz. Did he indicate in any other way, other than just stating 
the fact that December 1969 or the latter part of 1969 was an oppor- 
tune time to make contributions ? 

Mr. Masters. Tn Austin ? 

Mr. Weitz. Did he tell you — other than stating the fact that it was 
an opportune time, did he give any explanation as to why December 
1969 or the latter part of 1969 was an opportune time to make such 
contributions ? 

Mr. ]VL\STERS. The only thing I can recall now that he said was that 
this is a good time to make any, if you are able to make it. 

Mr. Weitz. And despite the fact that he had been involved in poli- 
tics, as you say, in Texas for a number of years, this is the first time 
he had ever made this suggestion. He had never come to you or made 
similar suggestions duiing an election year, for example? 

Mr. Masters. Alan, I am not going" to say that he didn't. He well 
may have. I can't. — ^I don't recall any specific instance now. 

Mr. Weitz. And you don't recall any other instance in which he 
came to you and asked that you make political contributions of several 
thousand dollars in cash ? Prior to this latter part of 1969 ? 

Mr. Masters. I don't follow your question. 

Mr. Weitz. In other words, he may have asked you at other times, 
but you recall no other instance such as this, where he asked prior to 
the latter part of 1969, when he asked you for substantial contributions 
of several thousand dollars in cash ? 

Mr. Masters. I can't recall any. 

Mr. Weitz. Did you comply with his request ? 

Mr. Masters. Yes. 



6943 

Mr. Weitz. How did you do so ? How much did you orive him ? 

Mr. Masters. Well, I ^ave him several thousand dollare. 

Mr. Weitz. All at once, in cash ? 

Mr, Masters. No. Not all at once. 

Mr. Weitz. How much did you give him initially ? 

Mr. Masters. I can't tell you exactly, Alan. It was several thousand 
dollars. Maybe a couple. 

Mr. Weitz. In cash ? 

Mr. Masters. Yes. 

Mr. Weitz. "What was your source of the funds ? How did you gen- 
erate the cash to give Mr. Lilly ? 

Mr. Masters. From my bank account. 

Mr. Weitz. You wrote checks to cash in your bank account? 

Mr. Masters. Yes. 

Mr. Weitz. Cashed the checks and then gave the cash to Mr. Lilly ? 

Mr. Masters. Well, generally, yes. 

Mr. Weitz. Let's take the first time if you can recall. Did he come 
to you in person or did he make the request by telephone ? 

Mr. Masters. I think it was — to the best of my recollection it was in 
person. 

Mr. Weitz. And then did you give him the money subsequent to 
that in person or did you — if it was in cash, I take it you gave it to 
him in person ? 

Mr. Masters. Yes, sir. 

Mr. Weitz. You never mailed him a money order or cashier's check 
or anything of that nature ? 

Mr. Masters. No, sir. 

Mr. Weitz. And you never recouped any of those moneys through 
billings to AMPI? 

Mr. Masters. No, sir. I gave him my money. 

Mr. Weitz. Now, I would like to mark as exhibit 1 a copy of a 
voucher and check from AMPI to you dated January 6, 1970. 

[The documents referred to were marked Masters exhibit 1 for 
identification*.] 

Mr. Weitz. Do you recall receiving a copy of that check? 

Mr. Masters. I don't recall this check specifically any more than 
any of the 

Mr. Weitz. Now, on the voucher, exhibit 1, which describes the bil- 
lings covered by — represented by the check, it refers to four invoices, 
three dated November 4, 1969, and one dated December 20, 1969, for a 
total of $11,840, less an advance of $5,000 on December 19, 1969, for 
a total for the check of $6,840. 

Do you recall the circumstances in connection with that advance of 
$5,000* on December 19? 

Mr. Masters. Let me see that check. 

Mr. Weitz. Do you recall anything in connection with that event? 

Mr. Masters. Excuse me just a minute. 

Mr. Weitz. Surely. We will go off the record. 
[Discussion off the record.] 

Mr. Masters. Alan, to the best of my memory, on this check here, 
we formed AMPI in 1969. We were— t had been so busy and every- 



*See p. 6973. 



6944 

body else had been so busy that my billing's were late as usual. If mem- 
ory serves me correct, Bob Isham was the comptroller and I believe it 
was Bob — I told Bob that I hadn't charged, AMPI what I felt was a 
reasonable fee for the year 1969 and that he could expect to get another 
bill from me and to the best of my recollection. Bob said, "Well, hell, 
I will give it to vou now." And I think he — that is — I don't know when 
that — - 

Mr. Weitz. Well, there were no further billings, though, in that 
year? In other words, we have got — let me indicate to you. We have, 
for example, the billings — perhaps we ought to mark them as exhibits. 

Exhibit 1-A is a billing, dated November 4, 1969, for $1,810 and that 
is one of the billings represented on exhibit 1. 

[The document referred to was marked Masters exhibit 1-A for 
identification.^] 

Mr. Weitz. And then 1-B is in the amount of $1,490 and that is also 
another item listed on exhibit 1. 

[The document referred to was marked Masters exhibit 1-B for 
identification."] 

Mr. Weitz. And thirdly, 1-C is a billing, dated November 4, 1969, 
and that is in the amount of $4,340. 

[The document referred to was marked Masters exhibit 1-C for 
identification.^] 

Mr. Weitz. That is also the third November 4 billing indicated on 
exhibit 1. That leaves the billings dated December 20 for $4,200 and 
frankly we are trying to obtain the invoice for that. I believe — I have 
been told by someone at AIVIPI that it indicates domestication in 14 
States, 14 or 15 States, and that total — those are the invoices covered 
by the January 6 billing, exhibit 1. And then the advances as indicated. 

Wliat you are saving is that despite these billings — I am not sure 
what it represents. You had submitted these billings by the end of the 
year and yet you were saying that you told Ishani to give you an ad- 
vance on those billings or on some future billings ? 

Mr. ]Masters. No. I told Bob that I hadn't hilled them enough for 
that year. I just finished putting together I think one of the largest co- 
operatives in the Ignited States and I felt that I had done a pretty fair 
job of it and I told Bob he was going to get an additional billing for 
1969. 

Mr. Weitz. IVlien did you submit that billing? 

Mr. Masters. I don't know. 

]\Ir. Weitz. Well, the records that we have indicate that except for 
this special December 20 billing for $4,200, all the other billings we 
have indicate a monthly billing. It is broken down by individual serv- 
ices, and so forth. And there is no other s])ecial billing for $5,000 or any 
other indication, any subsequent l)illing of additional services rendered 
in 1969 subsequent to this advance other than the December 20 billing, 
which was not in the amount of $5,000 and has the domestication serv- 
ices listed there. 

Now, what I am asking you is if you told Isham that — in what form 
did you subsequently reflect additional sei'vices in 1969 that were rep- 
resented by this advance that you received in December? 



^ See p. 6974. 

2 See p. 6976. 

3 See p. 6978. 



6945 

Mr. Masters. Right now I don't know. 

Mr. Weitz. All rio;ht. 

Mr. DoRSEN. Mr. Masters, I would just like to ask you a few ques- 
tions on the advance. Can you place the discussion with Mr. Isham at 
any time ? 

Mr. Masters. I am not even sure it was Isham but I think it was. 

Mr. DoRSEN. And as best you can recall, what was said in that 
conversation? 

Mr. Masters. Well, I think the conversation came up— my billings — 
I was traveling a lot then and I would get behind. A lot of times I 
would submit more than 1 month at a time. And at this paiticular time 
I just told Bob, I said, "I haven't billed you enough for the year 1969. 
I haven't charged you enough for what I have done." 

Mr. DoRSEx. Was this convereation before you submitted the four 
bills or invoices that were paid by exhibit 1 ? 

Mr. Masters. Probably so. 

Mr. DoRSEN. Well, I think it probably was also because it is reflected 
as an item on that particular invoice. If that were true, didn't you have 
at least a month or two in which to bring your billings up to date and 
secure adequate compensation for the year 1969? 

Mr. Masters. I don't follow you. 

Mr. Dorsen. If 1969 still had a month or two to run and you had not 
submitted exhibits 1-A, 1-B, and 1-C yet, why is it that you needed 
an advance in order to bring your billings up to what you considered 
a reasonable amount? Couldn't you just incorporate that into your 
subsequent billings ? 

Mr. Masters. Well, I didn't^ — if I understand your question cor- 
rectly — I didn't need an advance. To the best of my recollection, Bob 
said, "Well, about how much is it going to be," and I think I probably 
mentioned the figure $5,000 and he said. "Well, hell, here it is now." 

Mr. Dorsen. Were you short of cash at that time ? 

Mr. Masters. No, I don't believe so. 

Mr. Dorsen. But an advance would not affect the total amount of 
your billings, would it ? 

Mr. Masters. I don't know why it is called an advance in the firet 
place. 

Mr. Dorsen. Well, what do you believe it to be ? 

Mr. Masters. I mean — it was a payment to me. 

Mr. Flake. I think what he is saying is that that was not an ad- 
vance. That was payment for services already rendered that he had 
not prepared a stat^^ment on yet. 

Mr. Dorsen. Well, isn't that an advance? 

Mr. Flake. It is an advance on a statement to come, yes. 

Mr. Weitz. Obviously it is an advance for services, not an advance 
as a gift. 

Mr. Flake. No; but I am saying it is not in the nature of a re- 
tainer to do a certain thing. 

Mr. Dorsen. I understand that. It was an advance on what was 
expected to be forthcoming on later billings. My point is that $5,000 
advance in that form would not affect the total that Mr. Masters would 
l:>ill AMPI and, therefore, the exj:)lanation with respect to this conver- 
sation w^ith presumably Mr. Isham does not indicate what Mr. Masters 
is saying; namely, that if you felt you wanted to bill more on what 



30-337 o - 74 ■ 



6946 

3'0ii were underbill ing AMPI, you would not ask for an advance for 
later billino;s but you would ask for additional amounts and on ex- 
hibit 1 the $5,000 is subtracted from later billing which does not 
aifect the overall amount that you received from AMPT. 

Mr. Weitz. In other words, it just affects the timing rather than 
the total. 

Mr. DoRSEN. Exactly. 

Do you have any further explanation ? 

Mr.' Masters. Well, I didn't write this stub on the check here and 
I • 

Mr. Dorsen. But isn't it clear that you received payment only for 
that amount for which you billed, whether it was earlier than your 
bill was received or after your bill was received ? 

Isn't that clear ? 

Mr. Masters. I don't follow you. Wlien we were forming AMPI, 
we formed it really just about before MPI was, you might say, solidi- 
fied, and during that time we had several different home offices. Wliat 
I am trying to say is, it was sometimes hard to get paid. We had a 
controversy going at one time as to wliicli constituent co-op would 
pay the expenses of incorporating the new one and in particular who 
would pay the legal fees. 

INIr. DoRSEX. So now you are saying it wasn't so much a question 
of how much you would be paid but who would pay you and when 
you would be paid ? 

Mr. IMasters. Well, it was a question of both. I felt that I, at that 
time, was entitled to really a substantial fee for the work done in 
1969. 

Mr. DoRSEN. Are you saying that you did not submit bills to AMPI 
which reflected the full \ alue of your services ? 

Mr. IMasters. Looking back on it with my hindsight I feel that I 
should have charged them substantially more than I did ; yes. 

Mr. DoRSEX. Looking at it at the time you were talking to Mr. 
Isham or whomever else you were talking to, was that the thrust of 
your conversation, that you did not anticipate to bill AMPI for the 
full value of your services? 

Mr. IMasters. No. I don't follow your question. At the time I felt, 
and I believe it was Rob Isham that I told, I hadn't billed them enough 
for 1969, that I felt I was entitled to more. 

Mr. Weitz. And subsequent to that did you actually bill for addi- 
tional services in 1969 ? 

Mr. Flake. Do you have a bill reflecting this ? 

Mr. Weitz. No. We just have, other than this December 20 billing 
which is for domestication in a numl^er of States and is in the amount 
of $4,200, we have a series of your billings bv month. The three for 
November that are listed on exhibit 1 cover the periods August, Sep- 
tember and October, and then the billings in January continue on. 

Mr. Masters. I am sure you don't have all of my old billings. I 
don't — I think I possibly — well, I know I threw a bunch of them away 
when I moved. 

Mr. Weitz. There is one other, and perhaps we can move to that 
just to round out the picture. 

First let me mark as exhibit 2 

Mr. Sanders. Are you going to leave this bloc ? 



6947 

Mr. Weitz. No. 

Mr. Sanders. When you o;et all finished with that I would like to 
ask a few questions. 

Mr. Weitz. Perhaps to shed further light on this, exhibit 2 is a 
copy of a check from MPI to you, dated December 19, 1970, in the 
amount of $5,000 and this is presumably the advance on that date 
just for your identification. December 19, 1969, is the date; I am sorry. 
And your endorsement is on the back. 

[The document referied to was marked Masters exhibit No. 2 for 
identification.^] 

Mr. Weitz. Is that a copy of the check that you received ? 

Mr. Masters. Well, it must be. 

Mr. Weitz. Now, perhaps to shed further light on this, we also 
have a copy of a check dated December 2, 1969, which I will mark 
as exhibit 3, in the amount of $5,397.96 from MPI to you with your 
endorsement stamped on the back. I would like you to identify that. 

[The document referred to was marked Masters exhibit No. 3 for 
identification.^] 

Mr. Weitz. Is that a copy of the check that vou received from 
MPI? 

Mr. Masters. It must be. 

Mr. Weitz. Now, what I want to ask you is this. I don't know 
whether this will shed any further light on it or not. MPI and AMPI 
have reviewed their records and find no billing, no invoice from you 
to correspond to that check and as I indicated before, all of the bill- 
ings which we have here follow a monthly pattern so that there is 
no month missing that isn't accounted for by way of an invoice from 
you and a corresponding check from MPI or AMPI. 

My question is do yon have any recollection in connection with 
either of those two checks, particularly the December 2 check as to 
what those checks represent ? 

Mr. Flake. Are you saying these two checks are not reflected on 
any billing? 

Mr. Weitz. The December 19 check is reflected by way of advance 
on exhibit 1. The Decembei- 2 check is not reflected in any invoices that 
are in AMPI's files. ]My question is do you have any recollection of 
the purpose or the invoice reflected in that check ? 

Mr. Flake. It is also not reflected in any of his billings. 

Mr. Weitz. No. 

Mr. Masters. Well, I just pull a blank on this one. 

Mr. Weitz. Off the record. 

[Discussion off the record.] 

Mr. Flake. He cannot rememlier what those checks are for. He 
thinks that the $5,397 check, the larger check, would more likely be 
the money he talked to Isham about but he doesn't specifically re- 
member for either of them. 

Mr. Weitz. Rather than the advance — rather than the $5,000 ad- 
vance check ? 

Mr. Flake. Yes. 

Mr. Weitz. And is there any reason that he would get a check to 
cover that conversation without there either being a billing or any 



See p. 6982. 



reason that the amount would be a odd figure, such as that repre- 
sented by exhibit 3 ? 

Mr. Flake. Well, that is what is confusing to us. He really does 
not remember and we don't know. It is strange you have liis billing. 

Mr. DoRSEN. Mr. Masters, you just heard tlie colloquy between Mr. 
Weitz and your counsel. Does that accurately state your position? 

Mr. Masters. I suppose so. I am just — at the present time I am just 
blank on that one. 

Mr. Weitz. I might say if you are able to search your files and 
find an invoice that would be covered by this December 2 check, by 
all means submit it to us and that can be entered into the record, or 
any other explanation for it. 

Mr. Masters. Well, I will look again, Alan. I think you have all 
of my invoices that I had but I will check again. 

Mr. Weitz. Is there any connection between either of these two 
payments represented by exhibits 2 and 3, the $5,000 and $5,897, and 
the request for money made of you by Bob Lilly ? 

Mr. Masters. No, sir. 

]\Ir. Weitz. Did Lilly in an}' way indicate that AMPI would be more 
amenable to an increase in your fees because of your cooperation with 
him? 

Mr. Masters. No. 

Off the record. 

[Discussion off tlie record.] 

Mr. Weitz. Mr. Masters, your billings reflect two conversations, a 
number of conversations in December 1969 and January 1970. By look- 
ing at tliose would that refresh your recollection as to when you 
discussed this request or Mr. Lilly made tliis request of you for money ? 

Mr. Masters. [Nods no.] 

Mr. Weitz. Mr. Sanders, do you liave some questions ? 

Mr. Saxders. Yes. Can I have exhibits 2 and 3 ? 

Mr. Masters, I am referring here to exhibits 1-A, 1-B, and 1-C 
which arc your invoices to AMPI for the months of August, Septem- 
ber, and October 1969. They all bear at the top the date of November 4, 
1969. 

Do you have a recollection as to whether these were all submitted 
on November 4 ? 

Mr. Masters. In answer to your question, I would assume they were 
submitted on November 4 or 5. Tliis is what I was talking about a while 
ago. I would get behind. 

Mr. Sanders. You assumed because of the date they bear at the top, 
they would have been timely submitted after that top date ? 

Mr. Masters. Yes ; I assume the date is correct. 

Mr. Sanders. You have no recollection that these were submitted 
in December and given an advance date? 

Mr. Masters. No ; as far as I know that date is 

Mr. Sanders. Now, if these had been submitted timely on or after 
November 4, wasn't it in your experience that AMPI would have 
promptly paid you after receipt of these invoices ? 

Mr. Masters. Well, what do you mean by prompt ? 

Mr. Sanders. All right. If not within the month of November, at 
least sometime soon after the first of December when in fact the 
records show that you were not — there was no accounting to you for 
these until the 6th of January ? 



6949 

Mr. Masters. Well, it wasn't imiisiial for them to be late in paying. 
A month was not unusual. 

Mr. Sanders. Instead of an advance being given to you on Decem- 
ber 19 as reflected on this exhibit 1, wouldn't it have been more logical 
if Tsham had simply paid you the smn total of these three invoices 
on December 19 ? 

Mr. Masters. I suppose so. 

Mr. AVeitz. Mr. Sandere, can I perhaps ask one clarifying question 
on that? 

We have most of the billings for 1969 from you to AMPI— MPI, 
rather — and they indicate, for example, each month's billing is paid 
in the same month it was submitted. 

Does that refresh your recollection as to the timing in 1969 of the 
receipt of payment from MPI for your billings? 

Mr. Masters. I don't follow you, Alan. 

Mr. Weitz. In other words, you indicated sometimes there would 
be a delay of a month or two. Here we have a question of three No- 
vember 4 payments being paid in January, and all of your other pay- 
ments; all of your other billings in January of that year indicate 
that they were paid the same month they were dated. 

Mr. Masters. Well, they were so tardy in paying that I usually 
hand-carried them over to tsham. 

Mr. Weitz. On or around the time that they were dated? 

Mr. Masters. Yes ; usually. 

INIr. Dorsen. Mr. Masters, on a number of the invoices that you sub- 
mitted there is a stamp which was presumably put on by AINIPI. 
For example, in exhibit 1-C. I assume you have no personal knowledge 
of that stamp. Do you have any personal knowledge of that stamp 1 

Mr. Masters. This stamp here? 

Mr. Dorsen. Yes ; you did not put that on ? 

Mr. Masters. No. 

Mr. Dorsen. Now, if you will look at the date that the item was 
checked on exhibit 1-C t believe it is indicated as being checked on 
January 6, 1970, is that correct? 

ISfr. Masters. It has a date here January 6, 1970. 

Mr. Dorsen. Right. On some of the other items that we have, for ex- 
ample — without introducing into the record at this point — on the bill 
that you submitted on Januaiy 28, 1970, there is a stamp initialed 
apparently by the same person, which was a check on the same date, 
namely January 28, 1970. On the other bills, for example, the one 
you submitted on January 6, 1969, it is checked 9 days later, Janu- 
ary 15, 1969. Now, in this case, apparently the matter was not even 
checked in the internal — within the internal workings of AMPI 
until more than 2 months following the date of the bill that you placed 
on it, and again does that refresh your recollection or does that make 
you want to change your testimony concerning the date on which 
you submitted exhibits 1-A, 1-B, and 1-C to AMPI ? 

IVIr. Masters. I don't follow you — I am not familiar with this stamp 
that you are referring to. I have no idea what it 

Mr. Dorsen. Well. I think we can assume, based on the fact that 
tliese documents were obtained from AINIPI and that you did not place 
the stamp on the documents, that the documents were stamped by an 
employee of AMPI and one of the items on the stamp is checked "fig- 



6950 

ures" and there is a column for "by" and it is initialed "AF" and then 
there is a date. In several of the invoices yon submitted, the date is 
either the same date or within a week to 10 days after the date of the 
invoice. One of the three documents that has been marked, namely, 
exhibit 1-C, is stamped. The other two are not. Under the item checked 
"figures," there are again the initials "AF" which appear on some of 
the others, but the date is January 6, 1970, so that, apparently, accord- 
ing to what would be your testimony, 2 months elapsed between the 
time you submitted exhibit 1-C to AMPI and the date they actually 
even checked the figures to indicate that the figures presumably added 
up to the total of that bill ; namely, $4,340. 

Given that additional information, I am asking does that either re- 
fresh your recollection concerning the date that you prepared and sub- 
mitted exhibit 1-C and also 1-B and 1-A, or does that make you want 
to in any way modify your testimony on that subject ? 

Mr. Masters. No.* 

Mr. Flake. Could T ask a question of you, Mr. Dorsen ? 

Does that stamp, the date on that stamp, usually correspond with 
the date on the check in payment? I know in this case it is the same as 
the time of the check. 

Mr. Weitz. Let's go off the record. 

[Discussion off the record.] 

iVfr. Dorsen. Back on the record. 

In answei* to your question, in the documents that we have, the date 
of tlie check is either the same day or 1 day aft«r the date on the 
checked figures, although I also note thei-e are additional columns or 
rows for proof of payment and check number which are sometimes 
filled in. They are not filled in on exhibit 1-C. 

INIr. Flake. That was my next question. But generally, they cor- 
respond fairly close to the date of payment. 

Mr. Dorsen. That is correct. 

Mv. Flake. So if they had not been going to pay this bill until then, 
they probably would not have been stamped or checked until that date. 

Mr. Dorsen. Obviously, we do not know that on the basis of this 
record, but I think it is fair to note, and your point is so noted. 

Mr. Weitz. In connection with the same period of time, let me ask 
vou one further question, Mr. Masters. We have a check from A]\IPI to 
you, dated January 23, 1970, in the amount of $7,379.78, and that cov- 
ers a payment — is payment for an invoice of the same date from von to 
AMPI." 

[The document referred to was marked Masters exhibit No. 4 for 
identification.*] 

Mr. Weitz. I would like you to take a look at the check. Is that a 
copy of the check you received? Is that your endorsement on the 
back? 

Mr. Masters. It appears to be. 

Mr. Weitz. Now, my question is this. The back of the check has 
below your signature — appears to have "TDL," which someone has 
pointed out is a Texas driver's license and a driver's license number. 
Is that your driver's license number in Texas? 

IVf r. Master. I don't have any idea. 

Mr. Weitz. Do you have a copy of your driver's license with you? 

Mr. Flake. It has pi'obably expired since then. 

♦See p. 6982. 



6951 
Mv. Wfjtz. Is that tlie same kind of number, same nnmber of 

dio-its^ 

Mr. Masters. It could be it. 

Mr. Wkitz. Now. below that is a stamp, "Pay any bank''; then 
there is another stamp on it, "Exchange ANB"' and I btdieve this 
was stamjied by the Alamo National Bank. Is that a bank you banked 
at in San Antonio? 

Mr. ]VIastkrs. I have banked there, yes. 

Mr. Weitz. Now, the stamp which also indicates the saine date, 
January 23, is as I understand it, normally a stamp for either— a 
stamp that you receive on a check when you cash a check or obtain 
a cashier's check. 

There is no indication it was deposited. My question is: Do you 
recall whether you either obtained a cashiers check or cash for this 
check ? 

Mv. Masters. I think I got a cashier's check foi- this one. 

JNIr. Weitz. And do you remember wdiat the reason was for obtain- 
ing; a cashier's check? Did you ever deliver a cashier's check either 
to Mr. Lilly or anyone else that 

Mv. jNIasters. No. 

Mr. Weitz [continuing]. That you can recall in approximately that 
amount ? 

Mr. ^Masters. No. Didn't I give you a copy of that cashier's check? 

Mr. Weitz. I can't say. If you did, I don't know. 

Mr. ]\Iasters. I think I did. 

Mr. Weitz. Who would the cashier's check have been made out to? 

Mr. ISIasters. Me. 

Mr. AVeitz. And do you recall for what purpose ? 

Mr. Masters. I sure don't. 

Mr. Weitz. And looking at the cashier's check, would that refresh 
your recollection? 

Mr. Masters. You know, that has been several years ago, Alan, 
but I am sure there was — I am not sure. I believe, though, that that 
was a cashier's check made payable to me, and I believe that after- 
ward I deposited it to my account. 

Mr. Weitz. You are saying that you took the check from AMPI, 
had a cashier's check made out to you and then deposited the proceeds 
of that cashier's check into your account. 

Mr. Masters. Yes. 

Mr. Weitz. Would there have been any reason for you not to just 
deposit that AMPI check directly into your account? 

Mr. Masit:rs. I don't — now, I can't think of any. There may have 
been one then, but whatever it was, I 

Mr. Weitz. Have you checked your bank records to find out whether 
in fact that deposit was made to your account on that day or sometime 
shortly thereafter ? 

Mr. Masters. Well, I doublechecked my account, but I am sure it 
was deposited in the account sometime thereafter. 

Mr. Weitz. You indicated that you made a number of payments to 
Mr. Lilly, is that correct — several payments? 

Mr. Masters. Yes, sir. 

Mr. Weitz. Do you know how many payments ? 

Mr. Masters. Two or three. 



6952 

Mr. Weitz. Would each payment be in the amount of $1,000 or 
more, or did you ^ive him several hundred dollars at a time — in, let's 
say, the course of a week or two to amount to a contribution of several 
thousand dollars? 

Mr. Masters. To the best of my recollection, it would be over $1,000. 

Mr. Weftz. So you did that two or three times? 

Mr. Masters. Yes, sir. 

Mr. Weitz. And that would be the total — that would represent the 
total amount of moneys that you gave to Mr. Lilly. 

Mr. Masters. Ye^, sir. 

Mr. Weitz. Over what period of time did these payments take 
place ? They began in late 1969. How long did it last ? 

Mr. Masters. To the best of my recollection, Alan, I am not even 
positive that first one I gave him was in 1969. To the best of my recol- 
lection, I believe it was 

Mr. Weitz. Or early 1970? Would it have been shortly after his 
request ? 

Mr. Masters. I don't know what you mean by shortly, but, yes, I 
guess you would say it was shortly after. 

Mr. Weitz. Within several weeks? 

Mr. Masters. To the best of my recollection, I believe it was the lat- 
ter part of 1969. 

Mr. Weitz. And if Mr. Lilly's records indicate that on January 5, 
1970, he had deposited or utilized $1,000 that he had received from 
you, would that be consistent with your recollection that sometime just 
prior to January 5 you gave him approximately $1,000 ? 

Mr. Masters. J have no independent recollection of January 5 or 
the amount. 

Mr. Weitz. Now, subsequent to the first request, do you recall any 
specifics with regard to subsequent requests by Mr. Lilly? What he 
said to you, under what circumstances, what time, and so forth ? 

Mr. Masters. No, no more than I have told you. 

Mr. Weitz. Each request to the best of your recollection was essen- 
tially the same as the first request ? 

Mr. Masters. He said he needed some money in Austin. Just what 
I have told you before. 

Mr. Weitz. He said that on each occasion. 

Mr. Masters. Generally. 

Mr. Weitz. Did he also say on each occasion that this was a — the 
time of that request was a particularly opportune time to make a con- 
tribution as he had in the first instance ? 

Mr. Masters. I don't know whether he said opportune time or good 
time. It will do — one will do as much good as two would any other 
time, I believe. 

Mr. Weitz. But he said that each time, each of the same times he 
made the request? 

Mr. Masters. Well, I can't say he said that every time, Alan — 
generally 

Mr. Weitz. I am soriy. 

Mr. Masters. To the best of my recollection, generally I would say 
that that is what he said. 

Mr. Weitz. Were you aware at any time, at the time or subsequent 
to his first request of you for money, of any similar request he was 



6953 

making or moneys he was receiving from anyone else connected with 
AMPI? 

Mr. Masters. No, sir. 

Mr. Weitz. By "connected with" I mean either a lawyer or con- 
sultant retained by AMPI or anyone else? 

Mr. Masters. No, sir. 

Mr. Weitz. Did he ever tell you who he gave the money to or how 
it was used? 

Mr. Masters. Well, he just said that, from the way he talked — I 
can't recall any specific conversation on it but it w^ent to the political 
hierarchy in Austin. 

Mr. Weitz. Did you ever meet anyone, or in any way find out from 
either a recipient of the money or representative of the recipient any 
acknowledgement of the contribution or contributions? 

Mr. Masters. Not offhand, I don't recall any. 

Mr. Weitz. Could you estimate for us what your annual income was 
in 1969 and 1970 — personal income? 

Mr. Masters. It would be a pure guess, if you want a pure guess. 

Mr. Weitz. Approximately. 

Mr. Masters. I would say from 

Mr. Weitz. Well, let me ask you this. In a previous interview with 
us in response to that question, you said you recollected at that point 
that your earnings approximated $30,000 a year. Do you agree with 
that? 

Mr. Masters. Well, that could be. Yet, it could be more. 

Mr. Weitz. What was your income from AMPI? What were the 
amounts that you received annually, approximately, from AMPI? 
What portion of your firm's billings did AMPI represent? 

Mr. Masters. When I first stai-ted representing the milk producers^ — ■ 
beginning in, I would say 1965, it started taking a substantial portion 
of my time, and by 1969 it was taking the vast majority of my time. 
In fact, it really advei-sely affected my other practice. 

Mr. Weitz. During the jDeriod 1969 through 1972, did you make any 
other contributions — political contributions — in the amount of $1,000 
or more ? 

Mr. Masters. I am sure I did. 

Mr. Weitz. In the amount of $1,000 or more, other than to Mr. 
Lilly? 

Mr. Masters. I think I made — during that period I made one to 
Congressman Mills. I believe I sent you that check. 
Mr. Weitz. That was done by check. 

Mr. Masters. That was to get Mills to run for President. When was 
the last Presidential election ? 
Mr. Flake. 1968 ? 1972? 

Mr. Masters. Some committee for Mills, Mills for President or some- 
thing of that nature. 

Mr. Weitz. Who asked you for that ? Did anyone solicit that con- 
tribution ? Do you recall ? 

Mr. Masters. Not oft'hand, I don't. I have always been an admirer 
of Mr. Mills and I still am. , . 

Mr. Weitz. If you have a copy of the check — we have received all 
the copies of checks by you to cash for a period of time and you also 
have sent us copies of tliree checks for political contributions, the 



6954 

largest beinj; $100. and none of them for national or Federal office; 
and if you liave a co])y of that check, which as you characterize it, 
would be a Presidential contribution, we would appreciate you for- 
wardinjj it to us. 

Mr, Masters. Sure. 

Mr. Sanders. In other words, you think you have not received it as 
he says he has. 

Mr. Masters. Whether you have or not I would be happy to send you 
a xeroxed copy. That is no problem. 

Mr. Weitz. By your testimony, you gave Bob Lilly over a period of 
time, pursuant to several requests, several thousand dollars for some- 
one or some people in Austin, and you never w^ere told to whom exactly 
it was given, in what amount, or never received any acknowledgement 
in any way from any of the recipients or any representatives of the 
recipients, is that correct ? 

Mr. Masters. I can't recall now any acknowledgement. 

Mr. Weitz. Did you ever talk with Mr. Nelson or anyone else either 
at AMPI or connected with AMPI about these payments? Did you 
have any assurance that Mr. Lilly was not using the money for some 
other purpose, for personal use or otherwise ? 

INIr. ]Masters. Well, of course, I had no assurance that he wasn't 
gambling it away as far as that goes, but I had a great deal of confi- 
dence in him. 

Mr. Weitz. Did you feel that he was acting pursuant to Mr. Nelson's 
authorization ? 

Mr. Masters. No. Bob, ever since T have known him, has been 
active, very active politically in Austin. He was on pretty good t«rms, 
I suppose, with every prominent person in State politics, from the 
Governor on down. 

Mr. Weitz. Do you recall the smallest amount of money you gave 
Mr. Lilly at any one time ? 

]\f r. JVIasters. Lord, T have no idea. 

Mr. Weitz. Would it be in excess of $1,000 ? 

Mr. Masters. My best guess is that it probably was $1,000 or above. 

Mr. Weitz. And do you have any recollection as to the largest 
amount of money you ever gave to Mr. Lilly at anv one time ? 

Mr. Masters. Not now, I don't. 

Mr. Weitz. If his records indicate that in September 1970, he 
utilized $4,000 which he had received from you on or around that time, 
is that consistent with your recollection or does that refresh your re- 
collection in any way ? 

Mr. Masters. No ; it doesn't refresh my recollection. 

Mr. Weitz. Did you ever have any conversation with Mr. Lilly in 
which you either resisted or indicated you were short on cash and 
couldn't give him the amounts requested at a particular time or by a 
certain date ? 

Mr. Masters. Oh, I think there were several times there that I told 
Bob that I was hurting or something of that nature. 

Mr. Weitz. I am sorry. What was that ? 

Mr. Masters. That I couldn't at the time. 

Mr. Weitz. That you didn't have the money, essentially. 

Well, Mr. Lilly, as you have testified — we don't know why he was do- 
ing it but you took it to be at least partiallv to vour benefit, in the sense 
of accruing, perhaps gaining some contact, and so forth, in Austin. 



6955 

Mr. Masters. Right. 

Mr. Weitz. Did you A'iew it as a business expense? Wliether or not 
deductible for tax purposes, a kind of expense for doing business? 

Mr. Masters. I will put it this way, Alan. At the time it seemed to 
be a good idea from my standpoint. I suppose you could say that it 
was good business. I felt it was. 

Mr. Weitz. Did you view it as a fee return ? 

Mr. Masters. Well, if you practice law you have got to have connec- 
tions and I felt, over the long pull, that it would be good business for 
me. 

Mr. Weitz. Did you know anything or were you aware of any loans 
that Mr. Lilly had made and that were still due at the time, owing 
and due at the time he asked you for money ? 

Mr. Masters. No, sir. 

Mr. Weitz. Do you recall when the last payment — approximately 
wdiat time or date the last payment to Lilly w^as made by you ? 

Mr. Masters. No, I don't. 

Mr, Weitz. Do you recall approximately what total amount you 
gave to Lilly over a period of time ? 

Mr. Masters. Well, I couldn't tell you exactly, Alan. To the best of 
my recollection, around $4,000 or $5,000. 

Mr. Weitz. Did it stretch over more than a year's time? From the 
first request to the last ? 

Mr. Masters. I really don't — I really just don't remember. It could 
have — I would say it was around a year but it could have been over a 
year. I just couldn't tell you. 

Mr. Weitz. Did you deduct those payments on your Federal income 
tax or any income tax returns or any way reflect those payments on 
your income tax returns ? 

Mr. Masters. No. 

Mr. Weitz. Can you give us any explanation as to why, even viewing 
it as good business, you gave several thousand, perha]:»s $4,000 or $5,000 
to Mr. Lilly over the period of a year or perhaps slightly more than 
a year when your income was perhaps approximately $80,000 or some- 
what more, without any indication of who was receiving the money or 
any indication of any direct benefits you were receiving as a result of 
the payments ? 

Mr. Masters. No more than what I have told you. 

Mr. Weitz. Have you any evidence or indication that you did re- 
ceive any benefits from Austin or otherwise as a result of the payments ? 

Mr. Masters. None that I could pinpoint, Alan, except that I feel 
that if I needed to find out something or needed to know someone in 
Austin, Bob could help me. 

]\Ir. Weitz. Do you recall any instance in which he did assist you 
after the first payment ? 

Mr. Masters. Not right offliand, no. 

Mr. Weitz. I believe you 

Mr. Masters. The point is that Bob had been in Austin, in and 
around Austin, in and out of State politicsi Alan, for years. He was 
pretty well versed up there, in my opinion. 

Mr. Weitz. I believe you indicated that you attended some or a num- 
ber of the AMPI board meetings. Certainly, initial board meetings. 
Mr. Masters. I probably attended about all of them, I would say. 



6956 

Mr. Weitz. Your function — wasn't it to record the minutes for those 
meetings ? 

Mr. Masters. Well, tlie board always wanted to have — always had 
a lawyer present at all the board meetings and I assisted the secretary 
in preparing the minutes, preparing the resolutions. We were selling 
quite a bit of surplus real estate then, keeping track of that. 

Mr. Weitz. Now, at any of these 

Mr. Masters. The committee meetings. 

Mr. Weitz. I am sorry. You also attended committee meetings? 
Would those have included the finance committee meetings ? 

Mr. Masters. Oh, sometimes I — I have attended finance committee 
meetings, yes. Usually it would be the base committee, though. That is 
where we were having our main controversy at the time. 

Mr. Weitz. That leads me into the question of whether you were 
aware of, and if so, what you were aware of in connection with com- 
plaints about the budget and high expenditures of the home office of 
AMPI. Was that matter discussed at board meetings ? 

Mi-. Masters. I have heard directors complain about it at board 
meetings, yes, sir. 

]\Ir. Weitz. Wei-e your billings billed to and reflected in the budgets 
of the home office of AMPI ? 

Mr. Masters. I have no idea, Alan. I would — I assume they 

Mr. Weitz. What was the nature of the complaints by these board 
members? 

Mr. Masters. Well, the board members complained a lot, [)eriod, and 
expense was one of them. 

jMr. Weitz. Was there ever any discussion that you heard or any 
explanation given that you were aware of that a number of attorneys' 
billings or other high expenses of the home office were related to 
political activities? 

Mr. INIasters. No. 

Mr. Weitz. Were you aware of any political activities engaged in 
by attorneys or consultants for AMPI 

Mr. Masters. No, sir. 

Mr. Weitz [continuing]. That were reflected in those high fees? 

Mr. JNIasters. No, sir. 

Mr. Weitz. Did you attend a board meeting in Las Vegas? 

Mr. ]\Iasters. Yes, sir. 

Mr. Weitz. How many meetings took place in Las Vegas, to your 
recollection ? How many times did the board meet there ? 

Mr. Masters. I don't recall them meeting but once. It was a hell- 
raising meeting. I do recall that. 

Mr. Weitz. Do you recall whether the matter of high expenditures 
was raised at that meeting ? 

Mr. Masters. Alan, I don't — I couldn't say that it was or wasn't. 
That meeting lasted about all night and as I say, it was a hell-raiser. 
I suppose evei-ything that — every facet of AMPI came up at that one. 

Mr. Weitz. Do you recall approximately when that meeting was 
held, what year or what time of year? 

Mr. jNIasters. I believe it was in December. 

Mr. Weitz. Of which yeai-, do you recall ? 

Mr. ISIasters. Well, it has been several years ago now, I would sa3\ 
My guess is that it was 1970. 



6957 

Mr. Weitz. Now, Mr. Nelson was replaced as general manager in 
January 1972. Do yon place it in time — does that lefresh you recol- 
lection as to whetlier this meeting in Las Vegas was just prior to that 
or about a year pi-ior to that ? 

Mr. Masters. Oh, Lord. No. My guess is that it was quite a while 
prior to that time. I would say about — again, I am guessing. I would 
say about a year, maybe more. 

INIr. Weitz. So it might be December 1970. Is that your best recol- 
lection. 

]\rr. Masters. Yes. 

]Mr. Weitz. Now, at that meeting, did Mr. Nelson give any explana- 
tion for the high expenditures of the home office? 

Mr. Masters. Nelson was at the board meeting and I don't recall 
anything specifically that he said. He was at the meeting. 

Mr. Weitz. Did he say that some of the attorneys were conduits ? 

Mr. Masters. If he said it, I don't recall it. 

Mr. Weitz. Was there any discussion either at that meeting or any 
other meeting you can recall of political activity of AMPI as opposed 
to TAPE ? ' 

Mr. Masters. No. Of course. T was aware that there was such a thing 
as TAPE. I suppose that at most of the meetings some reference was 
made to TAPE. 

Mr. Weitz. But apart from TAPE, was there any reference made or 
discussion at those meetings whether on the record or off the record, 
of political activities or political contributions being effected by AMPI 
through attoT'ueys oi- consultants retained by AMPI ? 

Mr. Masters. No, sir. I don't recall any. Tliere were, you know, polit- 
ical activities mentioned. I mean. Alan, of course. Various members 
would sav they would call their Congressman or Senator. You know, 
on an individual basis. Swear to the Depai-tment of Agriculture, if that 
is what you mean by politics. 

Mr. Weitz. I have just two other short matters to cover and then 
]Mr. Sanders can proceed with his questioning. 

One, did you have any connection with or representation — did you 
engage in any repi-esentatioii of AMPI in connection with the milk 
price-support decision by the Secretary of Agriculture in 1971 ? 

Mr. Masters. No. sir. 

Mr. Weitz. Did you have any representation — did you engage in 
any i-epresentation or othemvise liave any connection with the matter 
of the antitrust suit filed bv the Department of Justice against iVMPI 
in 1972 ? 

Mr. Masters. Well, I have attended — maybe I didn't catch your 
question. 

Mr. "Weitz. Did you represent them in some capacity or take part 
in representation of AMPI in connection with the antitrust suit? 

Mr. ]\Iasters. Yes. I helped prepare the answer we filed in San An- 
touio. I attended several preliminary hearings. 

]\rr. Weitz. Now, in vour phone — in the records and your billings 
tliat include various telephone calls, and so forth, that you made on 
behalf of AMPI, various conferences, there is an indication that on 
January 6, 1972, you had a telephone call from Mr. Hundley, I be- 
lieve, at the Justice Department. Do you recall that? 
a\Ir. JMasters. Fi-om the Justice Department? 



6958 

Mr, Weitz, Who is Mr. Hundley ? Perhaps we haven't established 
that. 

Mr. Masters. Pie is a dairy farmer. 

Mr. Weitz. That has nothing to do with the Justice Department 
or the antitrust suit ? 

Mr. Masters. Well, I am not saying I did not get a call from the 
Justice Department. 

Mr. Weitz. I am talking about Mr. Hundley. We will get to the 
Justice Department in a minute. In other words 

Mr. Masters. Can I 

Mr. Weitz [continuing]. Was a Mr. Hundley connected with the 
Justice Department or antitrust suit at all or not to your recollection? 

Mr. Masters. No. If he was, I don't recall it. 

Mr. Weitz. Let me ask you something else. In, your billing of June 
2, 1972, to AMPI for the month of February 1972'. it indicates on Feb- 
ruary 18 "Tele|)hone conference. Nelson, Dean, Austin conference rate, 
dairy counsel, tax suit''; then "Texas Department of Agncidture," Do 
you recall who Mr. Dean is? The Mr. Dean indicated here? 

Mr. ]\Iasters. I sure don't. I don't have an independent recollection 
as to who Dean is. My guess is that it is a lawyer there. 

Mr. Weitz. A lawyer where ? 

Mr. Masters. In Austin or one from Dallas. 

Mr. Weitz. Now, in your billing of July 80, 1972, for the period 
of March 1972, there are several references to telephone conferences 
on March 14, 17, 20, and 22 Avith various Justice Department attorneys 
and other calls in connection witli the Justice Department suit. Do 
you recall anything specific with regard to those other than preparation 
of the answer in the suit? 14, 17, 20, and 22. 

Mr. Masters. Fourteen — on the 14th ? 

Mr. Weitz. That is what? 

Mr. Masters. Oh. yes. Well, the only thing I recall on that was just 
a meeting with the other attorneys and mapping out — 1 don't know 
whether we filed the answer by then or — my guess is we were getting 
ready to file the answer. 

Mr. Weitz. Was Stuart Russell one of the other attorneys? 

Mr. Masters. The I7th, yes. Obviously, we were getting ready to 
prepare an answer. 

Mr. Weitz. Was Stuart Russell one of the attorneys working on 
the suit? 

Mr. Masters. Yes, sir. 

Mr. Weitz, Did you have any contact with Marion Harrison of the 
firm of Reeves & Harrison in connection with the antitrust suit? 

Mr. Masters. No, sir. 

Mr. Weitz. What about Murray Chotiner ? 

Mr. Masters. No, sir. 

Mr. Weitz. Did you ever confer or were you aware of any advice 
given to AMPI by Jake Jacobsen in connection with the antitrust 
suit? 

Mr. Masters. No, sir. 

Mr. Weitz. The same question would apply to Marion Harrison or 
his firm. 

Mr. Masters. Right. 

Mr. Weitz. Are you aware of any contact being made by any of 
those gentlemen, either Mr. RuSvSell, Mr. Harrison, Mr. Chotiner or 



6959 

Mr. Jacobsen, with anyone at the administration, either tlie White 
House or the Justice Department 

Mr. Masters. No, sir. 

Mr. "Weitz [continuing]. In connection with tlie antitrust suit? Are 
you aware of any contact by any of those gentlemen wnth John Mitchell 
who I believe at that time was leaving the Justice Department to head 
up the Committee To Re-Elect the President ? 

Mr. Masters. No, sir. 

Mr. Weitz. Were you aware of any discussions at that time, which 
would be February or March of 1972, of any connection or possible 
connection between contributions by AINIPI or TAPE to the Presi- 
dent's reelection and the antitrust suit that had been filed against 
AMPI ? 

Mr. Masters. Well, I suppose somewhere along then I heard gos- 
sip. I don't know when it was, but I am sure I must have — gossip 
or rumors to that effect. I think it was in the newspaper along about 
that time. I never — as I told you before, my practice was — with AMPI 
was that all too many consuming nuts and bolts and I am not conver- 
sant in Washington at all. Somebody else always handled, usually 
always handled the Washington matters. 

Mr. Weitz. But in any of these conferences, although you may not 
have had an input into them in the matter of contacts with Govern- 
ment officials or political contributions, do you recall, besides gossip 
or- something of that nature, any references to attempts to talk to ad- 
ministration officials or make contributions or solicitations for con- 
tributions being made during that time? 

]\Ir. Masters. No, Just what I said, gossip and rumor. 

Mr. Weitz. 'Wlien was the firet time to your knowledge that AMPI 
was aware that a suit — that investigation of AMPI was underway 
by the Justice Department and a suit might be filed ? 

Mr. Masters. I don't recall hearing about it until we were actu- 
ally sued. Now, there may have been — I may have heard iTimors to 
that effect before the suit was filed but if I did, it was shortly before 
it was filed. 

Mr. Weitz. You were not, however, their lead antitnist counsel at 
that time ? 

Mr. Masters. No, sir. 

Mr. Weitz. Nor were you in contact with anyone in Washington on 
behalf of them. 

Mr. ]\Iasters. Mr. Sidney Harris was our — to the best of my knowl- 
edge does, or his firm did most of the antitrust work for AMPI here 
in 'W^ashington. 

Mr. Weitz. Do you have any knowledge of any unusual — w^ell, of 
any destruction of documents by any employees of AMPI in either 
1971 or 1972? 

Mr. Masters. No, sir. 

Mr. Weitz. Do you know of any requests that were made or sug- 
gestions made to employees of AMPI that certain documents be 
destroyed ? 

Mr. Masters. No, sir. 

Mr. Weitz. Or that any documents be destroyed ? 

Mr. Masters. No, sir. 

Mr. Weitz. Other than your general aw^areness of the fact that 
TAPE existed and engaged in contributions, do you have any specific 



6960 

knowledge, of particular contributions to the Presidential campaign 
of 1972 by TAPE ? 

Mr, Masters. No, sir. 

Mr. Weitz. Or by AMPI ? 

Mr. ]\f ASTERS. No, sir. 

Mr. Weitz. Now, when T say contnbutions. do you have any knowl- 
edge of any contributions, whether they were made in the form of 
money or expenditures on behalf of Presidential candidates? Do you 
have any knowledge of that either by AMPT or TAPE ? 

Mr. Masters. Not direct. The only thing, go back there to what, you 
know, rumor and gossip. 

Mr, Weitz. Didn't you e^er discuss this with anyone — that matter 
with anyone that you can recall ? 

Mr. Masters. No. T wasn't privy to anything really in TAPE, The 
only thing I knew was Bob Isham was the — T believe he was the trustee 
and whatever trust agreemeiit was prepared, was prepared as far as I 
know, by some Washington attorney. 

Mr. DoRSEX. Do you know any employees of AMPI that were work- 
ing for any candidate including Democratic candidates, for the 1972 
Presidential nomination ? 

Mr. Masters. No ; unless it was Bob Lilly. Well, I don't know what 
Bob — I don't know tliat either, because I don't know what Bob was 
doing. 

Mr. DoRSEN. Tn particidar, do you know any employees of AMPI 
who devoted substantially full time for- whatever period to the ef- 
forts of any Presidential candidates ? 

Mr. Masters. No, sir. 

Mr. Weitz. Are you familiar with the firm of A^alentine, Sherman 
and Associates? 

Mr. Masters. Wliere are they located? 

Mr. Weitz. I believe in Minneapolis. 

Mr. Masters. No, sir. 

Mr. Weitz. Are you aware of any 

Mr. Masters. Valentine ? 

Mr. Weitz. Valentine, Sherman and Associates? 

Mr. Masters. The only way — if Sidney Berde is — I think Sidney is 
a sole practitioner. Unless Sidney Berde is connected with them. 

Mr, Weitz, Mr. Berde is an attorney. 

Mr. Masters. Yes. 

Mr. Weitz. Now, if this firm is — are you aware of or familiar with 
a computer firm by the name of Valentine, Sherman and Associates 
in Minneapolis ? 

Mr, Masters. We may have — in answer to your question, I don't 
have any independent recollection or knowledge of such a firm. The 
only way that- — if that is a law firai and they 

Mr. Weitz. No. I said it is not a law firm. 

Mr. Masters, Oh, excuse me. I thought it was a law firm. Excuse me. 

Mr. Weitz. No. It is a computer firm. 

Mr. Masters, "VVHiat I was fixing to say, we had a patent infringe- 
ment suit way back Avhen, and we may have hired somebody in Minne- 
apolis, I know the lead counsel, though, was from Chicago, 

Mr. Weitz. Are you familiar with any arrangement whereby AIMPI 
paid for a firm providing goods or services such as mailing lists to any 



6961 

candidate, particularly any Presidertial candidate, for the 1972 cam- 
paign ? 

Mr. JNIasters. No, sir. I remember — list of AMPI? 

Mr. Wettz. Well, any mailino; lists or any other type of list. 

Mr. Masters. I was just going to say that the board always required 
very strictly that the membership list never be given out. In answer to 
your question, no. 

]\Ir. Weitz. Have you ever heard of the firm of Wagner and Baroody, 
a public relations firm in Washington ? 

Mr. Masters. No, sir. 

]\Ir. Weitz. Are you aware of any public relations firms in Wash- 
ington that were hired by AINIFI for whatever purpose? 

Mr. Masters. No, sir. 

Mr. Weitz. Do you know a George Webster who is an attorney in 
Washington ? 

Mr. Masters. No, sir. George Webster? 

Mr. Weitz. Yes. I believe you said that you had recalled a number 
of additional attorneys who at one time or another represented AMPI. 
If you would like to enter those into the record, if they are of any 
significance, 

Mr. INIasters. OK. Martin Burns in Chicago. I gave you Sidney 
Berde and George St. Peter, I believe. Don Alsop in Minnesota. 

Mr. Sanders. Did you say Don ? 

]Mr. Masters. Don. 

Mr. Sanders. Alsop ? 

:Mr. :Masters. A-L-S-0-P. New Ulm, Minn. 

ISIr. Sanders. Is that where Alsop is located ? 

Mr. Masters. Yes, sir. Then, of course, Erwin Heininger's firm in 
Chicago, Sidney Harris' firm in Washington. We had Leroy Jeffere 
from Houston for a short — well, I guess he still does. I think he is one 
of the lawyers in the antitrust litigation. We have some other lawyers 
in the antitrust litigation that I am not familiar w^th. There is one 
from Kansas City. We have local counsel there but I haven't been 
active in those antitrust suits, so I don't know. I don't know who the 
attorney was, I don't recall him ever mentioning his name, that set 
TAPE up in Washington, but I believe it was a San Antonio lawyer 
that represents tliem now, Anthony Nicholas. We used some local coun- 
sel in Houston. Jim Bailey. 

Mr. Weitz. Off the record. 

[Discussion off the record.] 

Mr. INIasters. Another attorney we used was in Indianapolis, John 
Grimes and Charles van Side. I don't think they use them any more. I 
think George St. Peter does everv'thing in Wisconsin. 

Mr. Sanders. Where is Van Side located ? 

Mr. Masters. In INIadison, Wis. 

]Mr. Sanders. Were you, at any time, aware that an attorney by the 
name of Jack Chestnut was utilized by AMPI ? 

Mr. Masters. No, sir. "\^'^lere is he located ? 

jNIr. Sanders. He is located in ]Minneapolis. 

jMr. Masters. Jack Chestnut? 

]\f r. Sanders. Have you ever heard the name before ? 

INIr. INIasters. I never have heard the name. Did he ever represent 
AINIPI in any matters or 



-337 O - 74 - Bk. 16 - 3 



6962 

Mr. Sanders. Well, I would rather yon just o;ive me the best of your 
recollection. 

Mr. Masters. OK. No, sir. 

Mr. Sanders. Do you know for what reasons Van Side was used? 

Mr. Masters. Yes. Charles, when we first put AMPI together — 
usually we utilized the attorneys that had been representing the con- 
stituent co-ops and that was one— the main reason we hired Van Side, 
and, well, I think Charles is a good lawyer and pretty well specializes 
in co-ops. I think he represents some electrical co-ops and other kinds 
of co-ops other than the agricultural type. 

Mr. Sanders. Were you personally acquainted with him? 

Mr. Masters. Yes. 

Mr. Sanders. Roughly, during what time period would his services 
have been utilized by AMPI ? 

Mr. Masters. During the formative period. I would say— let's see. 
We chartered AMPI in 1969, so it would have been — well, I would say 
the year 1969, especially the spring of 1969. We had a — I believe we 
had a lawsuit back then. We had a lawsuit in Antigo, I know, in Sep- 
tember and October and we had — I believe we had one in Federal court 
also in Madison at that time. 

Mr. Sanders. Do you recall during that time period any legal prob- 
lems relating to or involving Land-O'-Lakes ? 

Mr. Masters. No. I don't recall any legal controversies we ever had 
with Land-O'-Lakes. I^nless it was — now, we did have one lawsuit, 
oh, sometime around there involving a creamery. There was a lawsuit 
yye inherited in North Dakota about a creamery. Land-O'-Lakes may 
have been involved in that but I don't believe they were and that would 
be the only legal controversy I know of that we had with Land-0'- 
I^akes. 

Mr. Sanders. You told us that Sidney Berde was located in 
Minnesota ? 

Mr. Masters. Yes. 

Mr. Sanders. Do you know where ? 

Mr. Masters. Minneapolis, I believe. 

Mr. Sanders. And do you know what type of representation he 
provided for AMPI ? 

]Mr. Masters, Yes. Sidney is quite well versed in milk-marketing 
orders and co-ops and antitrust suits. He was in — he was one of our 
counsel in the first antitrust suit we had with MAV m Houston and 
I believe he also represented us some in — I think he still does in the 
suit with the other co-op that we have been fighting so long. It is not 
reallv a co-op. 

Mr. Sanders. NFO ? 

Mr. Masters. NFO. I think he has represented us in that from the 
beginning. He represented us in a suit in Chicago involving the Chi- 
cago order. Sidney is a good lawyer. 

Mr. Sanders. And Mr. Alsop, what type of representation did he 
provide? 

Mr. Masters, Well, a little bit of everything. Don was sort of in- 
herited like everybody else. He represented the old Five Star 
Creamery which we acquired and then after tliat, why. he represented 
us in all mattere, local counsel for IVfinnesota and that ])art of the 



6963 

country. Minnesota, the Dakotas, Iowa, Nebraska. And Alsop is a good 
lawyer, too. 

Mr. Saxders. And finally Mr. St. Peter, what was the nature of his 
representation ? 

Mr. INIasters. Well, we acquired a co-op in northern Wisconsin and 
he had represented them for years and they continued him on. He 
handles most things. I believe he is on all of "the antitrust actions, the 
NFO suit, and I tliink possibly the Justice Department suit, and he 
handles most things locally in Wisconsin. He sort of took Alsop's 
place, I would say. I think George has specialized over the years in 
co-ops. 

Mr. Sanders. Are you still providing legal representation to AMPI? 

Mr. Masters. Yes, sir. 

Mr. Sanders. Through the years did you feel that you were utilized 
by AMPI to secure local counsel in other goograjDhical areas where it 
became necessary ? 

INIr. JNIasters. Well, if T understand your question correctly, if I 
was assigned a lawsuit, we had a controversy in a certain area, why, I 
would either — usually would engage local counsel, yes. 

INIr. Sanders. All right. Let's say it hadn't come to the point of a 
lawsuit, but let's say there was some question or legal problem or 
lawsuit in a certain area aside from Texas. Would the AINIPI officials 
have turned to you to secure some local counsel or to suggest somebody 
or recommend somebody or would they have gone to the region? 

Mr. Masters. Well, probably they would have gone to the region if 
it was outside Texas, like, for example, if it was in Oklahoma, they 
probably would have gone to Stuart Russell. If it was in Wisconsin, 
they would probably go to Alsop, or St. Peter, or Van Side. Minnesota, 
they would go to Alsop. Or if it were assigned to me, I w^ould, unless 
I happened to know a lawyer in that area. 

In further answer to your question, it has been my experience there 
just isn't a whole lot of lawyers who have had extended experience 
with cooperatives and most of them are fairly well known. 

Mr. Sanders. From your experience witli AMPI, if the firm had 
been in need of some representation in Minnesota, let's say in 1970-71, 
with respect to State legislation aiTecting milk marketing, would they 
have turned to Alsop to begin Avith ? 

Mr. Masters. I don't know. I would — this is a guess on my part. 

]Mr. Sanders. Or would they turn to you to find somebody there? 

]\Ir. ]\Iasters. No. They would have either — in my judgment, they 
would either have gotten Alsop or gotten a recommendation from 
Alsop. 

Mr. Sanders. But in your judgment 

Mr. Masters. Or possibly Sidney Berde. Or possibly Van Side and 
St. Peter. 

Mr. Sanders. They were predominantly Wisconsin. 

Mr. Masters. Yes. 

Mr. Sanders. So if we are talking about Minnesota, you would 
think Berde or Alsop would be the principals. 

]Mr. IMasters. If it was just purely for political purposes, I would 
doubt that they would even go to Sidney Berde or Don Alsop because 
those guys are pretty much trial lawyers. 



Mr. Sanders. How would it have been handled? What would the 
system have been to secure legislative representation ? 

Mr. Masters. I don't know. I don't know. 

Mr. Sanders. You were never asked to suggest anyone for legislative 
work in INIinnesota? 

Mr. Masters. No, sir. 

Mr. Sanders. When Lilly came to you and talked to you about the 
need for Austin, who was the Governor of Texas at that time? 

Mr. Masters. Price Daniel. No. It wasn't Price. It Avas Smith. 

Mr. Sanders. What is his first name? 

Mr Masters. Preston. 

Mr. Sanders. Is he a Democrat? 

Mr. Masters. Yes. 

Mr. Sanders. Was the Texas Legislature democratically controlled ? 

Mr. Masters. Oh, yes. 

Mr. Sanders. You told us about a check which you wrote to Wilbur 
Mills. 

Mr. Masters. Well, it wasn't to him. It was to some committee 
to elect him President or something of that — words to that effect. 

Mr. Sanders. Can you put a year or a month on this? 

Mr. Masters. Well, it was at the time that the flurry was going 
on — when was the Presidential — a year or 2 years ago ? 

Mr. Flake. 1972, yes. 

Mr. Masters. When the flurry was going on for Mills to get the 
nomination. 

Mr. Sanders. Well 

Mr. Masters. You know. 

Mr. Sanders. It could have been early 1972. It conceivably could 
have been late 1971. 

Mr. Masters. Yes, sir. It was about the time when there were noises 
for Mills, Humphrey, and Muskie. 

Mr. Sanders. Did you send the check by mail? 

Mr. Masters. Yes, sir. 

Mr. Sanders. Do you recall the amount? 

Mr. Masters. $1,000. 

Mr. Sanders. $1,000? 

Mr. JSIasters. Yes, sir. 

Mr. Sanders. Was it drawn on your personal ac<?ount? 

Mr. Masters. Yes, sir. 

Mr. Sanders. Were you then personally acquainted with any per- 
sons serving as campaign officials for Mills ? 

Mr. Masters. No. I don't recall any. 

Mr. Sanders. You are acquainted with Joe Johnson? 

Mr. Masters. Yes. 

Mr. Sanders. Per chance, was this check sent to him? 

Mr. Masters. No, sir. I don't — to the best of my recollection, the 
check was sent to the committee — the committee that is on the check. 
Payee of the check. 

Mr. Sanders. Do you know whether a Joe Johnson was working 
in the Mills campaign? 

Mr. Masters. No. Last time I saw — knew of Joe, I believe he was 
working out of the Arlington office. 

Mr. Sanders. Of AMPI? 



Mr. Masters. [Nods, yes.] 

Mr. Sanders. How long ago was that? 

Mr. Masters. Oh 

Mr. Sandfjjs. "Within tlie last few months? 

Mr. Masters. No. No. This was several years — I would say when- 
ever he was there, I would say it is a couple of years or more. 

Mr. Sanders. Are you saying that you have no recollection of 
whether that $1,000 was solicited by anyone ? 

Mr. Masters. Yes, it Avas solicited. I am sure it was. 

Mr. Sanders. Well, I guess then you said you didn't recall who it 
Avas. 

Mr. Masters. Well, I don't know" what I said but it was solicited. 

Mr. Sanders. Do you remember whether it was? 

Mr. INIasters. Well, it was somebody from the Little Rock office. It 
was either — I don't know. It was either Kieflfer Howard or Dave Parr 
or — I don't think Joe. 

Mr. Sanders. Townsend? 

Mr. Masters. It could have been. I am not saying it wasn't. I don't 
think it was. 

I\Ir. Sanders. Most likely Howard or Parr. 

Mr. Masters. Most likely. 

Mr. Sanders. And if Howard, under what circumstances did this 
solicitation occur? By telephone, personal contact? 

Mr. Masters. Word of mouth. Word of mouth. Well, it could have 
been by telephone, but I don't — to the best of my recollection, it was 
by word of mouth. 

' Mr, Sanders. Were you aware at that time that solicitations were 
being made of AMPI employees for Wilbur Mills? 

Mr. Masters. No, sir. 

Mr. Sanders. Or of other persons such as yourself representing 
AMPI? 

]Mr. Masters. No. 

Mr. Sanders. Were you aware of any efforts on the part of Parr or 
other employees in Little Rock to amass a kitty for Wilbur Mills? 

Mr. Masters. No, sir; I wasn't aware of it. I mean it is common 
knowledge that all those people are great supporters of Mr. Mills and 
I am a great admirer of his also. 

Mr. Sanders. From the November 1968 election forward, was that 
contribution to Mills the only contribution you made to him? 

Mr. Masters. I can't be positive but I believe that is the only one. 
To the best of my recollection I believe that was the only one. 

Mr. Sanders. Did you receive any reimbursement from AMPI for 
this contribution to Mills? 

Mr. Masters. No, sir. 

Mr. Sanders. Did anyone indicate to you that you could recover it 
by your billings to AMPI ? 

Mr. Masters. No, sir. 

Mr. Sanders. Were you solicited for contributions to other political 
candidates? I mean solicited by employees of AMPI such as in the 
Mills instance? 

Mr. Masters. No. I suppose the only one connected with AMPI 
would still be Bob Lilly. 

Mr. Sanders. And that would be what you already told us today, 
you are speaking of ? 



6966 

Mr. Masters. Yes. 

Mr. Sanders. Let me limit this to Presidential candidates. Were you 
solicited by anyone with AMPI for any other contributions to Presi- 
dential candidates? 

Mr. Masters. Well, I don't know if this was solicited by an employee 
of AMPI, but I did make a contribution, I believe, to Hubert Hum- 
phrey. I don't know whether that was when he was running for Presi- 
dent or Senator. 

Mr. Sanders. All right. May I have the circumstance of that con- 
tribution? 

Mr. Masters. The only circumstance I can recall is that I gave him a 
check or sent him a check. 

Mr. Sanders. How much? 

Mr. Masters. It was somewhere between $100 and $500. I don't 
recall right offhand. 

Mr. Sanders. And you are unable to say w^hether he w^as running 
for the Senate or President ? 

Mr. Masters. No, sir. 

Mr. Sanders. Are you saying that that might have been solicited by 
someone with AMPI? 

Mr. Masters. It could have been, yes, sir. 

Mr. Sanders. Senator Humphrey ran for the Senate in 1970, and 
then in late 1971 he started his Presidential campaign. Can you place 
a closer time frame on your contril)ution to him? 

INIr. Masters. I can't. My best guess is that it w^as probably when he 
was running for President. 

Mr. Sanders. Do you think the 

Mr. Masters. Or w^hen he — didn't run — he hadn't run for President 
for many years but I mean when he was — my best guess, it was prob- 
ably when he was trying to get the nomination. Or whenever that was. 

Mr. Sanders. Do you think your check was payable to one of his 
committees as in the Mills case ? 

Mr. Masters. Yes, sir. 

Mr. Sanders. Would it most likely have been Lilly that solicited this 
contribution from you ? 

INIr. ]Masters. If it w^as — if an AINIPI employee did solicit it, it was 
probably Lilly. I don't remember now who it was, but if it was an 
AMPI employee, it probably was. 

Mr. Sanders. What indication did you receive, if any, that he was 
soliciting persons besides you for additional contributions to Hum- 
phrey ? 

Mr. Masters. None. 

Mr. Sanders. Did you receive any acknowledgement from the Hum- 
phrey campaign for your contribution? 

Mr. Masters. No, sir. 

Mr. Sanders. Did you receive any— — 

Mr. Masters. If I did, I don't recall it. I am not saying I didn't 
but I don't think I did. 

Mr. Sanders. Or did you receive any from the Mills campaign ? 

Mr. ]\Iasters. No, sir. Well, the same answer. I don't believe I did 
and if I did, I certainly don't recall it now. But I don't believe I did. 

Mr. Sanders. Were you reimbursed by AMPI for the contribution 
to Humphrey ? 



6907 

Mr. Masters. No, sir. 

Mr. Sanders. Or did anyone indicate to you you could recover the 
amount by billing? 

Mr. Masters. No, sir. 

Mr. Saxders. Did you make any contributions to Senator Muskie's 
Presidential campaign? 

]Mr. ]\Iasters. I don't believe so. I could have but I don't recall it. 
I don't believe I did. You are talking about when Muskie was trying 
to get the nomination in tlie latest Presidential race, I take it. 

Mr. Sanders. Yes. 

INIr. T^Iasters. Not when he was numing for Vice President. 

Mr. Sanders. True. 

]\Ir. Masters. I got a letter from him. From the Democratic 

Mr. Sanders. Thanking you for your contribution? 

Mr. Masters. Democratic National Committee soliciting one. That 
may have been Avhere I got the solicitation on Humphrey. But I don't 
recall. 

Mr. Sanders. You have no recollection of a contribution to Muskie? 

jNIr. Mastp:rs. No, sir. I don't believe I made one to Muskie. It is 
possible, but I just don't believe I did. 

Mr. Sanders. Do you liave any knowledge that AMPI used a system 
of paying bonuses to lany of its employees in order tp make funds 
available for contributions to Presidential candidates in the 1972 
campaign? 

]Mr. Masters. No, sir. I am not aware of that. 

Mr. Sanders. I think that is all. 

Mr. DoRSEN. Did you make any contributions to the McGovern 
campaign? 

Mr. Masters. No, I don't think so. 

Mr. DoRSEN. Were you solicited? 

Mr. jMasters. I am sure I got some correspondence on it from some- 
body in Washing-ton, Democratic headqiiarters, but I don't recall 
anything specifically on it. 

Mr. DoRSEN. Did you make a personal contribution to the President's 
campaign? President Nixon's reelection campaign? 

]\fr. Masters. No, sir. 

Mr. DoRSEN. Were you solicited? 

Mr. Masters. I don't liave any independent recollection of being 
solicited. I probably was. After Mr. Mills didn't get it, I pretty well 
lost interest. 

iN'Ir. DoRSEN. Do you have any other information or knowledge con- 
cerning requests for contributions of A^MPI or TAPE or contributiojis 
by those organizations in connection with the 1972 Presidential cam- 
paign which you haven't told lis about today ? 

]Mr. ]\Iasters. I am not aware of any. I think we pretty well 

Mr. DoRSEN. Did you have any participation whatsoever in any 
activity concerning import quotas — — 

Mr. JMasters. No, sir. 

Mr. Dorsen [continuing]. On the part of AJMPI? 

Mr. JMasters. I was aware of the import quotas. I mean, don't 
misunderetand. T was aware of it and I was- aware of the problem. 

Mr. DoRSEN. What you are saying is that you took no role per- 
sonally. 



6968 

Mr. Masters. No, sir. That was a Washinofton — generally con- 
sidered the Department of Agriculture, Washington matter which I 
didn't 

Mr. DoRSEN. Are you aware of any financial transactions of any 
sort between AMPI and Jake Jacobsen or John Connally ? 

Mr. Masters. No, sir. 

Mr. Weitz. Have you ever been retained by either IVIid- America 
Dairymen or Dairymen, Inc. ? 

Mr. Masters. No, no. I know who they are. I know — I want to be 
responsive to your question. I think I. probably — Jolm Gage represents 
Mid-America and I think I have possibly helped him on some legal 
matters. One in particular was on the franchise tax on being 
domesticated in Texas. But I have never been retained by them, never 
done any work for them as such. 

Mr. Weitz. What about any organizations of which they were — 
those organizations were members such as Central Amei'ica Coopera- 
tive Federation or Associated Dairymen or anything like that, any 
of those organizations'? 

Mr. Masters. Well, I don't recall having done any work for Central 
America but I am, of course, aware of Associated Dairymen. Right 
offhand, I don't think I have ever done anything for them. I have 
attended some — I think I undoubtedly — I have undoubtedly, I am 
sure attended some meetings of Associated Dairymen but it is — that 
is pretty vague in my mind. 

Mr. Weitz. Have you ever been asked for or given any moneys to 
any employees or anyone connected with those organizations? 

Mr. Masters. No, sir. 

Mr. Weitz. Now, we have received the billing which we were dis- 
cussing before from you to AMPI, dated December 20, 1969, a copy 
of that billing, and I would like to mark it as exhibit 1-D. I will 
show it to you for identification. Is this a copy of the billing of Decem- 
ber 20 to AMPI from you ? 

Mr. Masters. [Nods in the affirmative.] 

Mr. Weitz. Your answer is yes ? 

Mr. Masters. Yes. sir. 

[The document referred to was marked Masters exhibit No. 1-D 
for identification.*] 

Mr. Weitz. Now, the billing indicates a total of $4,200 which is 
represented as a backup for that January 6, 1970 check, exhibit, I 
believe, No. 1, and it reads "Domestication of the Following States," 
and there is a list of 14 States with a charge of $.300 each. 

Now, is that an accurate billing reflecting those services? 

Mr. Masters. Yes, sir. 

Mr. Weitz. Does this refresh your recollection as to aii}^ matters 
that we have discussed about your having provided services for which 
you had not billed AMPI in 1969, or any services for which you re- 
ceiA'ed advances? Or shed any light on the dicussion we had earlier 
in this interview ? 

Mr. Masters. No. I can't say that it does. 

Mr. Weitz. What actually do these services represent? What did 
you do in terms of the $300 per State ? 

•See p. 6981. 



Mr. Masters. Well, that was a rounded-off figure for getting us 
domesticated in those States. 

Mr. Weitz. Registered as licensed to do business? 

Mr. Masters. Yes, and that — in some States, of course, it is much 
easier, and much simpler. In most of them it is a pain in the neck. 

Mr. Weitz. Would this include expenses, or would you bill those 
separately ? In other words, expenses in connection with filing fees et 
cetera ? 

Mr. Masit.rs. That particular bill, right there, I couldn't say one 
way or the other. I generally tried to keep my expenses separate. Now, 
that may include a filing fee. I don't recall one way — it is possible that 
it does, but I don't think so. 

jNIr. Weitz. Did you retain any or maintain at the time in 1969 or 
1970, any diaries which would indicate — which would indicate either 
the time spent on particular matters or particular dates or events in 
which you participated ? Attorney's log of some sort ? 

Mr. Masters. No. 

Mr. Weitz. Well, how would you, for example, with respect to these 
billings which are fairly detailed as to date and services provided on 
particular dates and in some cases the time spent, how would you com- 
pute that or what record did you keep for those purposes? 

Mr. Masters. Well, as time went on — well, to back up a moment, I 
have been active in the bar association on attorneys' fees and charging, 
and I think somewhere in there I started usin^ these little timeslips, 
printed timeslips for each — for everything I did. A separate slip for 
each act or telephone call or what have you. And some notation there 
on the time. 

Mr. Weitz. And have you retained those records, those slips ? 

Mr. Masters. Generally not. Generally, when I get the bill made out, 
I throw those away. 

Mr. Weitz. And you have no other records that would in any way 
help you reconstruct, for example, the ser\4ces represented by that 
December 2 billing or the contacts that you had with Lilly in connec- 
tion with the payments to him ? 

Mr. Masters. No, sir. 

Mr, Sanders. You have told us that you made, you thought, two or 
three cash payments to Lilly for a total of $4,000 or'$5,000. 

Mr. Masters. That is what I estimate ; yes, sir. 

Mr. Sanders. Yes. Just as an estimate, I realize. Lilly's records 
show a payment to him by you of $1,000 in January of 1970, and none 
again until $4,000 was paid in September of 1970. I wonder if — well, 
first of all, I would like to know if you do remember that each time 
you made a payment to Lilly, it was person to person, and it was by 
handing the cash to Lilly. 

Mr. Masters. Yes, sir. 

Mr. Sanders. You never at any time wrote a check to him ? 

Mr. Masters. No. 

Mr. Sanders. Or gave him a cashier's check. 

Mr. Masters. No, sir. If I ever wrote him a check, it certainl}^ 
doesn't register on my memory. 

Mr. Sanders, Did he at any time give you a receipt ? 

Mr. Masters. No, sir. 



3970 

Mr. Sanders. Generally, where w aid the delivery occur? Do you 
recall where any of the transaction' occurred ? 

Mr. Masters. I think on one O' dsion it was in the parking lot when 
he said he was on the way to Austin. That is one. I don't know — it 
could have been in his office or oould have been in mine. 

Mr. Sanders. Other than what you have already told us, can you 
recall any further indication you received at any time about the dis- 
position he was making of the money ? 

Mr. IVIasters. It was always Austin. 

Mr. Sanders. Never gave you any — the name of any person for 
whom it was intended ? 

Mr. jNIasters. Not specifically. He was always mentioning every 
prominent officeholder in the State of Texas. 

Mr. Sanders. But he never mentioned any national political figures. 

Mr. Masters. No. 

Mr. Sanders. Was anyone else ever present when you made a de- 
livery to Lilly ? 

Mr. Masters. No, sir. 

Mr. Sanders. How would he arrange to meet with you and receive 
the money ? 

Mr. Masters. Oh, usually, I think, by telephone call. 

Mr. Sanders. Speaking directly with you ? 

Mr. Masters. Yes. 

Mr. Sanders. Did he ever involve your secretarj^ in any of these 
arrangements ? 

Mr. Masters. No. 

Mr. Sanders. I presume then, he would — you would 

Mr. Masters. He used — generally, I would say this is the way he 
would do. He would call me up and just say he was going to Austin 
and they sure needed, you know — he would have contacted me before 
and say, "Have you got anything to send the boys in Austin? I am 
getting ready to go ; can I come by ?'' 

Mr. Sanders. What would you do then after receiving that phone 
call? 

Mr. Masters. He could come by, either come by the office or I would 
meet him out in the parking lot. I remember one time he said he was 
in a big hurry, the time I met him in the parking lot. 

Mr. Sanders. Well, would it be necessary for you to cash a check in 
between the phono call and meeting him, or did you keep a sum of cash 
in the office for- 

Mr. Masters. Well, he would usually give me a little notice, say, you 
know, that he was going up next week or next month or something, so 
in answer to your question, if he was getting ready to go to Austin, no, 
I would already have the money in my pocket. 

Mr. Sanders. In other words, he probably wouldn't meet with you 
on the same day that he called. There would be some time 

Mr. Masit.rs. No. He would call — no. When he was getting ready to 
go to Austin, he would say, "I am getting ready to go to Austin and I 
will come by." 

Mr. Sanders. He would come to see you, then, on the same day that 
he called. 

Mr. Masters. Yes; but he would have talked to me. usually talked 
to me a week or more before. 



6971 

Mr. Sanders. Actually, there would be two calls. There would be an 
early call to indicate to you that he would be needing some money, 
and then there would be a call on the day he actually picked it up from 
you. 

Mr. Masters. Generally 

Mr. Sanders [continuing]. To more firmly fix the arrangements. 

Mr. Masters. Generally, that is the way it worked. 

Mr. Dorsen. According to Mr. Lilly's records, you gave him a total 
of $6,000 on three separate occasions. According to your recollection, 
could the amount have been as high as $6,000 ? 

Mr. Masters. Well, I don't want to say it couldn't have been. It is 
possible, but I don't think so. 

Mr. Dorsen. Now, is it your testimony that on each occasion when 
you gave Lilly money, that this was a separate request, unrelated to 
any other request, in the sense that there was no specific overall amount 
that either he requested or that you intended to give ? 

Mr. Masters. Repeat that question or read it back? 

Mr. Dorsen. In other words, was there a separate request for each 
time you gave him money, or was there some overall plan that he ex- 
pressed to you or you had in your own mind, that would result in 
several payments over a period of time of a particular amount? 

Mr. Masters. As I recall it, he would suggest an amount. 

Mr. Dorsen. Did you always give him the amount he suggested? 

Mr. INIasters. No. 

Mr. Dorsen. On those occasions wlien you actually gave him money, 
did you give him the amount he suggested? Do you understand my 
question ? 

Mr. INLvsTERS. I don't — well, sometimes I did and sometimes I didn't. 

Mr. Dorsen. So, are you testifying that on some occasions he asked 
you for money and you did not give him anything, and on other oc- 
casions he asked you for money and you gave him less than he asked 
for, and yet on other occasions he asked you for money and you gave 
him what he asked for? 

Mr, Masters. I suppose you could say that. 

Mr. Dorsen. And was that based on your financial position at the 
time? 

Mr. Masters. Yes. 

Mr. Weitz. You have said a number of times that Mr. Lilly told you 
the money was going to Austin. Were you aware of any bank accounts 
that Mr. Lilly had in Austin ? 

INIr. Masters. No, sir. 

]\Ir. Dorsen. Does anyone have any further questions ? 

Mr. Weitz. Do you have anything further ? 

JNIr. Flake, I don't think we do. 

Mr, Dorsen. I guess that will conclude the hearing for today. I be- 
lieve there are two outstanding requests which are on the record, and 
Ave Avill work out the mechanics of receiving the information from 
vou, if that is OK. 

Mr. Flake. Right. That is the Mills check and 

Mr. Dorsen. The record of the deposit of the cashier's check. 

Mr. Flake. Right. 



6972 

Mr. Weitz. Also, let me add a third. The backup or invoice of the 
December 2 check, which is exhibit No. 3, if there is any, if you have 
any. 

Mr. Sanders. May I add to that the Himiphrey check, if you can 
find it? 

Mr. Weitz. There are four requests. 

Mr. Flake. OK. 

Mr. Dorsen. Let me just add to that, that if there are any other com- 
munications or documents that you have respectin<r the ]Nlills contribu- 
tion or the Humphrey contribution such as solicitation letters or 
thank-you letters, we would appreciate copies of those, too. 

If tliat is the case, that will conclude the hearing for today. Should 
any further appearance be required, we will be m touch ^rith your 
lawyer, Mr. INIasters. 

[Whereupon, at 12 :15 p.m., the hearing was concluded.] 



6973 



Masters Exhibit No. 1 



r 


ACSOCIATED MILK FROOUCBRS, INC. 

PHONC A/C 512 3-14 1592 TCI EX 76 7.;46 

P. 0, GOX 32287 

SAN AKTuNIO. TEXAS 732J6 


NV 104 ^.-^^ 

^January 6, ,9.70^ 


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ASSOCIATED MILK PRODUCERS, INC. 




. Frank I'astcrs 

San Antonio, Texas 











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ASSOCIATED MILK PRODUCERS, iNC- 




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ocsc. .,„„,< 


"roTcc" 


D=„„c„o,.s 




11/4/69 
12/20/69 

ll/.l/o'./ 

12/19/69 




Legal Fees 
Less Advance 


4,3'.0.C0 




6,840.00 







6974 



Masters Exhibit No. 1A 



FRANK D. MASTERS 

ATTORNEY AT LAW 
7BOI BROADWAY - SUITE 207 
SAN ANTONIO. TEXAS 78209 

November 4, 1969 



Milk Producers, Inc. 
1011 N.W. Military Drive 
San Antonio, Texas 78213 

FOR LEGAL SERVICES rendered during the month of August, 
1969: 

8-1-69 Telephone conference with Sidney Harris; Houston conference 

re Jimmy Walters base case with attorneys. 130.00 

8-4-69 Attendance at Marketing Committee Meeting in Dallas; 

telephone conferences with Joe Long (2). 150.00 

8-5-69 Telephone conference with Walters' attorney; 1 hour 

miscellaneous office time re AMPI. 35.00 

8-6-69 Houston conference with Houston Bank for Cooperatives; 

telephone conference with Joe Long, Lee Young, attorneys; 

1 hour miscellaneous office time re AMPI printed matter. 190.00 

8-8through 11-69 Telephone conference with Stuart Russell; 3 

hours miscellaneous office time re preparation MPI copies 

for Stuart Russell, Bob Isham, preparation of letters for 

annual audit. 70.00 

8-12-69 Telephone conference Joe Long(2); Bob Isham, Ed Daly, 
Stuart Russell; 1 hr. miscellaneous office time re MAP 
settlement. 75.00 

8-13-69 Telephone conference Francis Haugh; conference with 

Bob Isham, Sidney Harris, Joe Long, and Stuart Russell 

re MAP settlement and annual audit. 75. 00 

8-14, 15-69 Attendance at MPI Board of Directors meeting. 300.00 

8-18-69 Telephone conference Stuart Russell, John Gage. 20.00 

8-19-69 Telephone conference Joe Long; 1 hour miscellaneous 

office time re MAP and equity opinions. 30.00 



6975 



-2- 



8-20-69 Telephone conference Stuart Russell, Frank Sheckarski 
and Ed Daly. Temple conference with FHA re Uniform 
Commercial Code Financing Statements, 120.00 

8-21-69 Telephone conference Stuart Russell; 1 hour miscellaneous 

office time. 30.00 

8-22-69 Telephone conference K. L. Howard; 2 hours miscellaneous 
office time re mailing MPI printed matter to Wisconsin; 
Houston conference South Texas Base Committee re McKenzie 
and Walters base. 140.00 

8-25-69 Telephone conference Stuart Russell, Joe Long; preparation 
of Order of Dismissal in Buckley suit with copies and 
miscellaneous correspondence; 1 hour miscellaneous office 
time re AMPl material. 75.00 

8-26-69 Telephone conference Lynn Elrod, Clapton McKenzie, 

Frank Sheckarski. 30.00 

8-27-69 Telephone conference Bill Odeneal, Joe Murphy; 1 hour 

miscellaneous office time. 40.00 

8-29-69 through 8-30-69 Attendance at Annual MPI Membership 

meeting and Board of Directors meeting. 300.00 

$1,810.00 



6976 
Masters Exhibit No. IB 



FRANK D. MASTERS 

ATTORNEY AT LAW 
7aai QROADWAY - SUITE 207 
SAN ANTONIO, TEXAS 78209 

November 4, 1969 



Milk Producers, Inc. 
1011 N.W. Military Drive 
San Antonio, Texas 78213 

FOR LEGAL SERVICES rendered during the month of 
September, 1969: 

9-3-69 Conference in Houston office. 60.00 

9-4-69 Telephone conference O. C. Copeland, Byford Bain, 

Joe Long, 30.00 

9-5-69 Telephone conference Stuart Russell, J. G. Anderson, 
Joe Long, Bill Butcher, attorney; office conference with 
Martin Fulcher. 55.00 

9-8-9-69 Telephone conference Bud Warren, attorney, Clayton 

McKenzie, office conference with Bud Warren, attorney. 75. 00 

9-10-69 Telephone conference Joe Long, Clayton McKenzie(2); 

and attorney general's office. 35.00 

9-10, 11-69 Attendance at Chicago AMPI Board meeting. 300.00 

9-12-69 Telephone conference Bill Ball; Lloyd Duncan, Pem-ose 
Albright; 1 hour miscellaneous office time re McKenzie 
Compromise and Settlement Agreement and patent matters: 
conference wfth Mapes in Sulphur Springs. 125.00 

9-15-69 Telephone conference Clayton McKenzie, Frank Sheckarski, 20.00 

9-16-69 Telephone conference Lynn Elrod and Washington Patent 

Attorney (Lahr); miscellaneous office time re patents. 60.00 

9-17-69 Telephone conference Joe Long(2); Jack Lahr, attornev. 

Bill Ball(2), Dan Noor lander and Phil Portei-. 80.00 

9-18-69 Telephone conference with J.Meyers, attorney, Omar 

Bjelde, Joe Long, Phil Porter, and Julius Mapes. 50.00 



6977 



9-19-69 Telephone conferenc^e Julius Mapes; 3 hours miscellaneous 
office time re preparation of AMPI matters and Federal 
Marketing Order resolutions. 70.00 

9-22-69 Attendance at Base Committee to amend base plan in 

Dallas. 90.00 

9-23-69 Telephone conference Clayton McKenzie and 

Frank Sheckarski. ' 20.00 

9-24-69 through 

9-26-69 Washington conference with patent attorneys and Noorlander 

re M'l patents. 300.00 

9-29-69 Telephone conference with Noorlander, Bill Ball, Lynn 

Elrod, John Grimes, attorney, Bob Isham, 50.00 

9-30-69 Telephone conference with Don Alsop, attorney; 

3 hours miscellaneous office time re AMPI charter 

matters. 70. 00 

51,490.00 



30-337 O - 74 • 



, ^^ 3 4 0. 

■^- 2 0. 

■f' 4 9 0. 

1. G 1 0. G ,'J 

1 1' S 4 0. 

5.000.00- 
S. 3 4 0. -;:■ 



6978 



Masters Exhibit No. IC 



FRANK D. MASTERS 

ATTORNEY AT LAW 
7BD1 BROADWAY - SUITE 207 
SAN ANTONIO, TEXAS 76209 



November 4, 1969 






Milk Producers, Inc. 
1011 N. W. MilitaryDrive 
San Antonio, Texas 78213 



FOR LEGAL. SERVICES RENDERED for the month of 
October, 1969: 

9-30-69 thru 10-2-69) Conference with Don Alsop, attorney 

and Five Star Group in Carringtun, N. Dakota, re r'ive 

Star lawsuit (2 days), 500.00 

10-2-69 Telephone conference Frank Sheckarski, Byford Bain, 

J. G. Anderson, and Ross Clark; attendance at Southern 

Division Base Committee hearing in Houston. 300. 00 

10-3,4-69 Attendance at AMPI Board Meeting, Madison, Wisconsin. 400,00 

10-3-69 Telephone conference Martin Burns, Dan Noor lander, 20.00 

10-6-69 Telephone conference Joe Long, Bob Isham, George Guy, 

Frank Sheckarski. 40.00 

10-7-69 Telephone conference J. G, Anderson, Joe Johnson; Dan 
Noo)-]ander, IRS (Washington); office conference with 
George Guy, Bob Isham, re Texas Federation. 200.00 

10-8-69 Telephone conference Francis Haugh, Bob Isham, Charles 
Van Sickle, Frank Sheckarski, Stuart Russell, Bud Warren, 
Fred Delone, and Antigo attorney. 100.00 

10-9-10-69 Attendance at court hearing in Antigo, Wisconsin, re 

Antigo equities. 450.00 

10-10-69Telephone conference Joe Long, Byford Bain, Frank 

Sheckarski; 1/2 hour miscellaneous office time re FHA 

deduction forms. 100.00 



10-11 -69Telephone conference Martin Burns, Bill Cureton, 
Joe Long. 



30.00 



6979 



-2- 



10-14-69 Telephone conference Charles Moore, John Grimes, 
attorney; 1 hour miscellaneous office time re FHA 
correspondence. 40.00 

10-15-69 Telephone conference Dan Noorlander; Bill Cureton; 

Frank Haugh; Charles Moore (2); and Bill Butcher. 60.00 

10-16-59 Telephone conference Frank Sheckarski; office 

conference with Harold Nelson and Charles Moore 

re employment contracts. 150.00 

10-17-69 Conference with John Grimes; Houston office conference 
re payment of STPA unclaimed equities and base claims 
re McKenzie and Terry Graham. 85.00 

10-20-69 Telephone conference Stuart Russell, John Butterbrodt, 
Francis Haugh, Frank Sheckarski, Harold Nelson, 
Joe Long (2), Stuart Russell, Jim Zeeger, attorney; 
office conference with David Gault; miscellaneous office 
trne 1 hour. 110,00 

10-21-69 Houston conference re MAP settlement. 200.00 

10-22-69 Houston conference re MAP settlement. 200.00 

10-23-69 Attendance at MPI Board Meeting at Dallas. 300.00 

10-24-69 Telephone conference with Bill Cureton, John Gage (2), 

Joe Long (2), Dr. Kraus; 1 hour miscellaneous office time 

re patents matters. 80.00 

10-27-69 Telephone conference Martin Burns, John Butterbrodt, 

Ron Zeeger, Attorney, Jim Jones; Austin conference with 

Secretary of State re AMPI, Texas Milk Producers 

Federation and Mid-America; miscellaneous office time 

(1 hour) re Central Indiana. 350.00 

10-28-69 Telephone conference with Meyers, patent attorney, 

John Gage, Dan Noorlander, IRS, Washington, Bob Isham, 

John Gage, Bill Odeneal; 3 hours miscellaneous office 

re contract with Dr. Kraus and Life Sciences. 130.00 

10-29-69 Office conference with Bill Ball; telephone conference 
Ken Stewart; 1 hour miscellaneous office time re 
AMPI mergers. 150.00 



6980 



-3- 



300.00 



10-29-69 A-ttendance at AMPl Board meeting in Chicago (2 days) 

10-31-69 Telephone conference with Stuart Russell, K. L. Howard, 

Bill Cureton. ^5Id^ 

$4,325.00 

EXPENSES: 



190 miles to Austin @10(+ per mile: 



18.00 



$4,340.00 



6981 

Masters Expubit No. id 

FRANK D. MASTERS 

AT70RNCY AT LA* 

December 20, 1969 



Asscx:!ated Milk Producers, ln< 
lOII N.W. Kiilitary Drive 
&n Antonio, Texas 78213 



FOR LEGAL SERVICES RENDERED as follows: 
Domestication In the followii^ states: 



Arkansas 


$3(^.(XI 


HLijiois 


300. (K) 


Mimiesoia 


mxm 


Indiana 


300. CX) 


Mississippi 


3CX3,O0 


Colorado 


300.00 


Oklahoma 


mj.m 


North r^kota 


m)M 


Tennessee 


m).m 


WisconsiB 


3W.00 


New Mexico 


300.00 


lov^ 


300, (X) 


Texas ' 


SCKi.OO 


&)imi I^kota 


303. CX) 




$4,200,00 



6982 



Masters Exhibit No. 2 



MIUK PRODUCERS. INC. 
SAN ANTONIO. TEXAS 78213 



RViVin^^OOOdor^OOcts 



N9 937 ^ 



December 19, ig 69 
S 5,000. 00 



Frank Masters 

7801 Broadway 

Suite 207 

San Antonio, Texas 78209 



MILK PRODUCERS. INC. 



/?./.'J- V. J.U . 



i:uiiO'"ODa3i: it-oi^a-in* 



,-■0000 500000.'; 



Masters Exhibit No. 3 



MILK PRODUCERS. INC. 
SAN ANTONIO^ TEXAS 7B2I3 



N9 758 



Itecember 2. iq69 



RT^^U'i'r^Z 9 7M^9(Bcts . 5.397.9 



Frank Masters 

7801 Broadway 

Suite 207 

San Antonio, Texas 78209 



MILK PRODUCERS. INC. 



/(?-/^- cP. rl.L 



u-'Oua'-'iH' 



/OOOOSISTIE., 



Masters Exhibit No. 4 



ASSOCIATED MILK PRODUCERS, INC. 

PHOHE A/C 512 344 1392 TELEX 76 7446 

P. O. BOX 32287 

SAN ANTONIO. TEXAS 78216 



N? 



273 



RK:6isffcf':£i; 



. January 23, 



_^/4l|SE 



M 



Frank D. Masters 

7601 Broadway 

San Antonio, Texas 78209 




ASSOCIATED MILK PRODUCERS, INC. 



A. 



7x^^vL^ 



3c» 2 I 

:i luo-'OooEi: oe. BEoaii" 



/0000737S78. 



FOR D:i(.,:ir gmiv 

PAY TO Ti:: 03:)D1 OF 

BfJOADV.'AY .^••.-:c;.!,^L BAWJt 

SAN AKTC, ;iO, TDXA5 

FRANK D, MASTE,-5S, ATTY 
No. 145-2160 



IT lANt. r.to • 

VKt NAIIONAt Z 
lANK 



_.»^ MirONlO. tlXAl 



j^ Rn 3ti5 DfcC 02 69 OOOOOi 



1 



1 >-ou;_.«A'.^ c.6.„. 3 



-AN a:j!Cn:o, laCAS 
33-2 30-2 



THURSDAY, JANUARY 10, 1974 

U.S. Senate, 
Select Committee on 
Presidential Campaign Activities, 

Washington, D.G. 
The Select Committee met, pursuant to notice, at 2 :15 p.m., in room 
G-334, Dirksen Senate Office Building. 

Present: David Dorsen and James Hamilton, assistant chief coun- 
sels; Alan Weitz, assistant majority counsel; Donald Sanders, deputy 
minority counsel. 

Mr. Weitz. The record should show that this is a resumption of the 
session from yesterday morning, a continuation of that session; and 
for the record, I would like the witness, Mr. van Dyk, to give his full 
address. 

TESTIMONY OF TED VAN DYK, ACCOMPANIED BY PAUL WARNKE, 
OF CLIFFORD, WARNKE, GLASS, McIWAIN & FINNEY 

Mr. van Dyk. Yes. Ted van Dvk. Home address, 8918 Belmart, Road, 
Potomac, Md. Office address, 1156 15th St. NW- Washington, D.C. 

Mr. Weitz. And would your counsel please identify himself for the 
record ? 

Mr. Warnke. Yes. My name is Paul Warnke, W-a-r-n-k-e, of the 
law firm of Clifford, Warnke, Glass, Mclwain & Finney, 815 Connecti- 
cut Ave., Washington, D.C. 

Mr. Weitz. Mr. van Dyk, I would like to begin with a background 
of your position, professional positions, I believe with Vice President 
Humphrey in the 1960'S, please. 

Mr. van Dyk. Yes. From 1964 to 1968 I served as Senator — then 
Vice President — Humphrey's principal speechwriter and assistant for 
domestic and foreign policy matters and in 1968 served as one of the 
principal managers of his Presidential campaign. 

Mr. Weitz. Now, following the 1968 campaign, could you tell us 
what positions you then occupied? 

Mr. VAN Dyk. Yes. Since that time I served as vice president of 
Columbia University. Then I returned to Washington in late 1969 
to form the consulting firm Ted van Dyk and Associates, which I 
now head and have since that time. I was active in the INIcGovern for 
President effort in 1971 and 1972, and was director of issues and re- 
search for the McGovern-Shriver Presidential campaign. My only 
other political association at the moment is that I am a member of the 
National Executive Committee of ABA and Washington representa- 
tive of the Southern Elections Fund, which is headed by Julian Bond 
and which assists black and other candidates in the Southern States. 

( 6983 ) 



6984 

Mr. Weitz. Off the record for a minute. 

[Discussion off the record.] 

Mr, Weitz. What was your first contact with representatives of 
Associated Milk Producers? 

Mr. VAX Dyk. Well, I saw them from time to time, of course, when 
Mr. Humphrey was Vice President, and he was a prominent agricul- 
tural adviser to President Johnson, and they periodically would make 
calls on his office and on me. 

I saw them in late 1968 after they lost the election campaifrn, and 
they indicated to me that they were interested in hirinir a number of 
consultants and would I be interested in working; with them. I said 
that my plans were not firm, but I would let them know. Well, in fact, 
I went to Columbia. However, they contacted me while I was there, 
and on a couple of occasions at least we met in person in New York 
and talked about the oreneral plans for the cooperative. I believe I 
wrote them a memo or two, and then when I retui'ned to Washington 
late in 1969, I did establish a consulting relationship with them which 
lasted until February 1972. 

Mr. Weitz. Now, in your meetings with them after you left — after 
the 1968 election and until the time when you began your firm, did 
you receive payments from them in connection with the advice? 

Mr. VAX Dyk. A $10,000 payment, I believe it was. A total for— to 
cover 1969 until such time as I established the company. 

Mr. Weffz. Who was it that you met with when you're talking 
about representatives of AMPI ? 

Mr. VAX Dyk. I met with Harold Xelson, David Parr, and George 
]\Iehren, who at that time, I believe, was still a consultant to them 
rather than a full-time employee. 

Mr. Weitz. We're talking aljout 1969? 

IMr. VAX Dyk. Earlv in mid-1969. 

Mr. Weitz. And when you were retained, your finn was retained by 
them, what Avere the arrangements in terms of payment ? 

]\fr. VAX Dyk. Initially it was a $25,000 annual retainer to be paid 
quarterly. I believe that's the way we started. 

Mr. Weitz. And theii. what subsequently happened ? 

Mr. VAX Dyk. Oh, later, I believe, from time to time they would 
change their billing instructions. It went into a monthly payment, 
and then they gave me an interim increase, and then in the last several 
months I worked for them, I was up to the level of a $5,000-a -month 
retainer. 

Mr. Weitz. Just for a complete picture, have you ever been re- 
tained by either ]Mid-America Dairymen or Dairymen, Inc.? 

Mr. VAX Dyk. Yes. I was i-etained by Dairymen, Inc., from — it 
would have been mid-1972 until October of 1973 when I resigned my 
relationship with them. 

INIr. Weitz. Was there a retainer arrangement with them? 

Mr. VAX Dyk. Yes. I did very little work for them, and it was $1,000 
a month retainer. 

INIr. Weitz. Were you also ever retained by Southeast Dairymen, 
another association? 

Mr. VAX Dyk. I have been and am retained by Southeast. The 
initials SI^DIA, which is the Soutlieast Division of the American 
Dairy Association; they deal wholly with advertising, promotion, 



69S5 

and public relations for the dairy industry. [ have been retained and 
still am at a retainer of $1,500 a mouth. 

Mr. Weitz. Do you know whether either Associated ISIilk Produc- 
ers or Mid- America or Dairymen, Inc., are members of that? 

]Mr. VAN Dyk. Well, Dairymen, Inc., is an important member of 
that. 

Mr. Weitz. I see. PTave you ever }>een retained by Central America 
Cooperative Federation, CACF? 

jNIr. VAN Dyk. I believe in fact I was. Lot me correct myself. You 
asked about Dairymen, Inc. I have in fact A\<n-ked for Dairymen, Inc., 
in the period, I believe, for the first 3 or 4 months; however, payment 
to me was made by CACF, which is Central America Co-op Federa- 
tif)n, of which Dairymen, Inc., is one member; and then they trans- 
feiTed me directlv to Dairymen, Inc., for payment, but in fact, the 
work ^^ as basically on behalf of Daiivmen, Inc., for the entire period. 

;Mr. WriTz. Xow, you said that in your meetings in 1969, early in 
1900, with representatives of AMPI you discussed the co-op and so 
forth. Did they ask your advice with respert to either access to the 
Nixon administration or political ((Uitributions in 1969? 

Mr. VAN Dyk. No. In fact, it was a hard and fast rule, which I 
thought was a wase one, that they never discussed relations with or 
contrilnitions to any Republicans or with the Nixon administration 
with me. They did during this early period talk with me about what 
their plans should be, how they could organize. They were relatively 
inexperienced in the public policy sector. They were in a position, I 
would say, which is roughly analogous to that of the labor unions in 
their earlier days. 

They knew that they lacked leverage politically, economically, that 
there were a dwindling numl^er of daiiy farmers as well as people in 
agriculture in general, and that in fact classic measures had to be 
undertaken to represent their interests. And I at that point, I am sure, 
discussed with them, as I'm sure others did, the necessity of having a 
])olitical action arm, a COPE, if you will. I think a TAPE or some- 
thing like it was already in existence as a matter of fact, but there 
was not — in 1969 there would have been nothing more than the most 
general amount of discussion about the ne(^essity for this type of 
activity. 

IVIr. Weitz. Did you give them any advice with respect to Presi- 
dential contributions as early as 1969 ? 

]Mr. VAN Dy^k. No. 

]Mr. Weitz. Did they ever mention to you, whether or not they were 
asking foi- your advice, any Presidential contributions they had made 
or were contemplating making in 1969 to the Nixon administration? 

Mr. VAN Dy'k. No. 

Mr. Weitz. And in the same vein, to 

Mr. VAN Dy'k. The Democrats. 

INIr. Weitz. To the Democrats ? 

Mr. VAN Dy^k. No. 

]Mi-. Weitz. Now, when your firm was retained by them, starting in 
Septeml^er or October of 1969 and thereafter, what was the relation- 
ship ; what type of services did you provide for them ? 

Mr. VAN Dyk. Basically those of consultancy. They varied. I ad- 
vised them on all aspects of what they were doing. I was — I guess you 



6986 

could describe me as their ambassador to the liberal Democratic com- 
munity. I introduced tliem to and arranged meetinsfs witli a number 
of liberal Democratic Senators and Congressmen, We had a number 
of — several dinner meetino;s, breakfasts, others in which various issues 
were discussed with Senators — Coiigressmen attended where AMPI 
personnel would also be present. I would often travel to San Antonio 
or to Little Rock and talk in general about climate of puljlic opinion, 
climate in the Congress, political developments. I would speak to A MPT 
member groups periodically. I airanged for Democratic speakers at 
their conventions and regional meetings. I wrote, I guess it would have 
been about a monthly newsletter to ]Mr. Nelson and Mr. Parr sum- 
marizing what I thouglit were major Washington developmeiits, Jiot 
just dealing with dairy, but with any major policy trends. 

So general, broad-gage consulting services. 

Mr. Weitz. You mentioned Mr. Nelson and ]Mr. Parr a number of 
times. Is there anyone else that you had frequent contact with or any 
substantial contact with? 

Mr. VAN Dyk. Not really. Not really. They were ]ny two principal 
contacts. I Avoidd from time to time see Mr. Townsend, who is now with 
I\Iid-x\me.rica, I believe, but was then with A^MPI out of Little Rock, 
who was a dairy economist. 

_ I would see, but dealt very little witli Robert Lilly from time to 
time. He was a face T would encounter. I dealt maybe as many as a 
total of three or four times by telephone with Robert Isham aiid saw 
Mr. Isham on other occasions in a larger meeting context, a)ifl I met on 
a number of occasions officers of AMPI and occasionally also officers 
of ]\fid-Am and DI who would apjiear undei- A^NIPT auspices at meet- 
ings, luncheons, et cetera. And I attended their convention each year 
where I would meet a number of their officers and members. 

Mr. Weitz, Now, in connection with the matter of milk price sup- 
ports in lOTl, did there come a time when you were either asked for 
or offered any advice to the dairy people in connection with methods 
they might use or any steps they might take in order to secure an 
increase ? 

Mr. VAN Dyk. Certainly, and it was not just in 197L but I think 
beginning in fact in 1969 and tliereafter, a basic question in their 
minds is Avhat ai^e the important contact y)oints where milk policy was 
made. I pointed out to them oliviously tlie Secretary of Agriculture 
was one. The members of the Agricultural Committees in the Senate 
and the House were contact points. Quite obviously, the Council of 
Economics Advisers, tlie Burea\i of Budget, later to become Office of 
Management and Budget, wo\ild have important bearing on any 
decision — all of these points that needed to be touched. 

Obviously, also they should, in pursuing their policv objectives, 
be in close and frequent contact with the Senators and Congressmen 
from the States in which they operated, 

Mr, Weitz. With respect to their efforts to secure an increase in 
1971 

Mr, VAN Dyk. Yes. 

Mr. Weitz [continuing]. Did thev ask any particular advice or 
discuss with you any particulai' problems they were having or any 
particular methods they were attempting to undertake to secure an 
increase that year? 



6987 

Mr. VAN Dyk. Yes. I knew they had a most active program of legis- 
lation and a large number of cosponsors in both House and Senate, 
as was noted in the white paper released yesterday. I also knew that 
they were frequently in Washington making contact with the admin- 
istration. They would, for instance, show up in my office saying that 
we have just been to see the Secretary of Agr-iculture, or we have been 
to the White House, and so on. But they were always quite discrete 
in never sharing with me any information about the substance of their 
discussions or how they were — what was transpiring in their contacts 
with the administration or with Republican Senators and Congress- 
men. 

Mr. Weitz. Now, when you say that — you mentioned that they were 
obtaining a number of cosponsors for legislation. 

Mr. VAN Dyk. Yes. 

Mr. Weitz. Do you recall whether you learned of this and, in fact, 
whether their efforts to do so took place before or after the first decision 
that year on March 12 by the Secretary of Agriculture ? 

Mr. VAN Dyk. I can't be sure, but I believe the legislative efforts 
began before the original decision. T can't be sure of that, but I'm rea- 
sonably sure that is the case. They were, in any case, by then in fre- 
quent contact with Senators and Congressmen from their States at 
least ; and I'm sure all of them wore aware of their position on a sup- 
port level. 

Mr. Weitz. Did they ask your advice or did you offer it with respect 
to whether it would be more fruitful to obtain an increase by legisla- 
tion as opposed to administrative act ion or vice versa ? 

Mr. VAN Dyk. Well, obviously, the first place you go 

Mr. Weitz. More fruitful or more likely ? 

Mr. VAN Dyk. Well, I don't recall having said that. I know they 
were in contact with legislators. I then recall that when there was 
great concern — and I don't know ^vhether the act had been undertaken 
or not — but there was great concern that the administration would 
not grant the desired support level. 

i\ir. AVeitz. Would this have been before the actual announcement? 

]Mr. VAN Dyk. I'm not sure. I had an awareness of it. I really can't 
remeuiber whether it was before or after the announcement. But there 
was a knowledge that either thei!" support level had not been granted 
or was not going to be granted, and a ver\' active legislative effort 
began. And they obviously began with the administration, because any 
President has the ability to grant tliat support level ; and that is where 
you start. 

]Mr. Weitz. Did they ever mention any contacts they were having or 
attempting to have with Secretary ( 'onnally ? 

Mr. VAN Dyk. Xo. I would get vague allusions from time to time — 
there would be mention of Colson, or mention of Connally, or mention 
of Nixon — but I would never be given any real information about what 
was being discussed or what their roles were. 

Mr. Weitz. In addition to the dairy peophv did you e\er meet with 
any of their other attornevs, other attorneys ;r other consultants of 
theirs? 

Mv. VAN Dyk. Yes. periodically I would. At their conventions I 
would meet other consultants. 

Mr. Weitz. In connection, however, with the milk price-support 
decision? 



6988 

Mr. VAX Dyk. Oh, yes. There AA'ere, in fact, a couple of meetings. 
They would always headquarte]- at the Madison Hotel, and there were 
a couple of meetings Avhere various consultants they may have em- 
ployed were present and discussed the situation and made suggestions 
about contact with the various legislators, et cetera, et cetera. And I 
would at those meetings, as follow up to these meetings, see other con- 
sultants, yes. 

INIr. Weitz. Did you over meet with or were aware of any meetings 
that were taking place between the dairy people and Marion Harrison ? 

Mr. VAX Dyk. No, I was not. In fact, I did not knoAv that they had 
any association Avith Mr. Harrison until thenoAvs reports. 

Mr. Weitz. What about Jake Jacobsen ? 

Mr. VAN Dyk. I knoAv that Jake Jacobsen Avas a consultant to them. 
I don't recall, hoAvever. ever being present in a meeting Avith him. 

Mr. Weitz. Were you aAvare, by Avhatever source at the time, of their 
effort to or of any intention or actual contributions on their part — the 
dairy industry's part — to the President's reelection effort ? 

Mr. A^AX Dyk. My first knowledge of this Avas in reading a story in 
the Washington Post, Avhich I believe Avas George Lardner's story, and 
I Avas shocked. There Avere hundreds of thousands of contributions to , 
dummy committees Avith really — some of them Avith A^ery ludicrous 
names. 

Mr. Weitz. This was an article in 1971 ? 

Mr. VAX Dyk. 1971. 

Mr. Weitz. Sometime shortly after the contributions Avere made? 

Mr. A^\x Dyk. Well. AvheneA^er it Avas. There was a story, and I Avas 
shocked, and called them about it. 

Mr. Weitz. Did they ever discuss with you or Avere you aAvarc at the 
time — this Avas during the price-support efl'ort in 1971 — of any con- 
tributions or intended contributions by the daii'y people to Democratic 
Presidential candidates ? 

Mr. A'AX Dyk. To my knoAvledgo, there AAere none. I mean, they didn't 
discuss any Avith me. I assume that they had contributed in 1968 to 
the Humphrey-Muskio campaign. I assumed that in 1972 they were 
going to contribute to the Democratic nominee Avhomever he might be, 
and I assumed that that Avas their intention. 

Mr. Weitz. But they didn't discuss that Avith you, either independ- 
ently at that time or in connection Avith the pi'ice-support matter? 

Mr. VAX Dyk. No. Not in that connection, no. 

Mr. Weitz. Did anyone from the daiiT industry, either at the time 
or after that, after the increase AA^as amiounced, discuss Avith you the 
matter of the increase and the reasons for — their perceived reasons 
for the increase? 

Mr. A^Ax Dyk. Yes. First of all, T recall on reading a neAvspaper arti- 
cle calling ]\Ir. Nelson and Mr. Parr both in outrage, saying "Why did 
you do this ?" I mean, this was an outrageous sum of money. 

The method described for the contributions, the names of the com- 
mittees — it appeared to me that they had not only been shaken doAA^n 
for large contributions but had been purposely humiliated, given the 
names of the committees and the means of dissemination. There Avas 
one, for instance, the Committee for the Preservation of the American 
Dream. The Nixon people had to knoAv that these contributions had to 
be publicly declared, that all this would come to light; that Avas the 
law. 



6989 

And I asked tliem "^Miy did you do this?" And they said "We felt 
we had to do it." And T could nevei- >iet a fullm- explanation. Following 
their convention in 1971, during which Mr. Parr and Mr. Nelson went 
onto the podium Avith Mr. Nixon, f called l)()th Mr. Nelson and Mr. 
Parr. I told them that T thought they might not see it but given the 
fact of the contributions, given the general tone of the convention, that 
they had far overstepped good judgment and I thought^ — I wanted to 
talk to them about it. And I went to Little Rock. Mr. Nelson was not 
there, but ISfr. Parr was; and he called two secretaries into the room 
Avho took notes. And I proceeded to tell INTr. Parr essentially what I 
had told him earlier, which was that I thought that they had been 
quite foolish in making these large contri})utions; that there was an 
implication that the action, the Federal Government's actions on pric« 
supports were tied to the contributions. 

Beyond that, my good sense told me that they had ovei-stepped the 
bounds. They were, after all, professional employees of AMPI; they 
were not elected officers of AMPI. And that when they, in fact, took the 
podium at the Chicago convention, I thought they had — it was entirely 
inappropriate. They were riding too high. They would be in serious 
trouble with their 'members. Hoav could they possibly justify these 
massive contributions? And Mr. Parrs response was on the contrary, 
their position had never been stronger within the organization, and 
morale had never been stronger within AMPI, and that my advice was 
in fact unfounded ; whereupon, I got back on an airplane and went 
back to Washington. 

Mr. AVeitz. Did he shed any light on the reasons for the contribu- 
tions or for the price-support increase ? 

INIr. VAX Dyk. Only the cryptic statement again that they felt they 
had no choice but to make the contributions ; that it was something 
that they felt they had to do. And my contention was it should not 
have been done. 

Mr. Weitz. When he said it was something he felt they had to do, 
was it in connection with the price-support increase? 

Mr. VAN Dyk. That was what I was tallcing about; that was what 
I was talking about. Yes. 

Mr. Weitz. He did not elaborate on that ? 

Mr. VAN Dyk. He did not, and I couldn't elicit any further. In fact, 
T was surprised when I went down there when immediately upon my 
arrival he called two stenographers into the room. 

Mr. Weitz. Do you remember their names? 

Mr. VAN Dyk. I do not. 

Mr. Weitz. AVere they secretaries or court stenographers ? 

Mr. VAN Dyk. They were secretaries whom I had seen around his 
office on past occasions, 

Mr. Weitz. Have you ever seen a copy of the transcript of that 
conversation ? 

Mr. VAN Dyk. I have not. And again, as I think I mentioned in a 
previous interview, I don't think they could have a transcript be- 
cause I talk fast and and they had no machine or anything. They were 
just taking notes. So I think, at most, a record of the general tenor 
and content of the discussion would be all that would have been made. 

Mr. Weitz. So, it is your judgment that it would not — even if a 
transcript existed, it would not necessarily be verbatim ? 

Mr. VAN Dyk. I don't think it would have been possible. 



6990 

Mr. Weitz. You said that the two stenographers were secretaries, I 
take it, that you had seen m Parr's oflice. 

Mr. VAN Dyk. Yes. I don't know Avho they were, but I had seen them 
in the past in the AMPI offices in Little Rock. 

Mr. WErrz. Do you know whetlier eitlier was Mr. Parr's personal 
secretary ? 

Mr. VAN Dyk. I couldn't be sure. I couldn't be sure. But they were 
secretaries who worked outside of his office. 

ISIr. Weitz. You say pliysically outside his office ? 

Mr. VAN Dyk. I'm not entirely sure. He had one g:irl who was his 
secretary, and I don't knoAV that she was one of them, but the other two 
I had seen. I know I bad seen both girls frequently in the AMPI 
offices. 

Mr. Weitz. Do you know Norma Kirk or Mrs. Kirk ? 

Mr. VAN Dyk. Is she his secret a ry ? 

Mr. Weitz. I believe at that time she was INIr. Parr's secretary. 

Mr. VAN Dyk. I'm not sure whether she was one of the two or not ; 
but if it was Norma, Norma was the one who sat outside his office. 
And I can't be sure that she was one of the two, but both faces -were 
previously familiar to me. 

Mr. Weitz. Could you describe them? 

Mr. VAN Dyk. One girl was relatively tall, blond, husky, not heavy 
but husky. The second girl I'm not sure; I can't remember. I remember 
there was a second girl. 

Mr. Weitz. Was this the only time that Mr. Parr, in any conversa- 
tions with him, had someone present w^ho tried to transcribe the con- 
versation ? 

Mr. VAN Dyk. Oh, from time to time when I was there, when there 
were other personnel there, somebody would take notes, but on a very 
casual basis. But this — I Avas taken aback by the formality of the whole 
business. I had knowm IMr. Parr — as I say, I had met him and ]Mr. 
Nelson in 1968. I had been associated with AMPI since 1069, and then 
in late 1971, when I arrived for Avhat I assumed Avould be an informal, 
confidential conversation, upon my arrival he called tAvo stenographers 
into the room. 

I don't want to attribute anytliing negatiA-e to that. I assume that he 
would have been highly uneasy and worried about his position given 
the events. 

Mr. Weitz. How much time after the AMPI couA-ention did this 
meeting take place, would you estimate? 

Mr. VAN Dyk. Oh, soon thereafter. 

Mr. Weitz. Within a month's time? 

Mr. VAN Dyk. Oh, sure. It must haA'e been Avithin a month's time. 

Mr. Weitz. Besides your telephone conversations Avitli INIr. Nelson 
and Mr. Parr and your meeting Avith Mr. Parr, is there any other time 
AA-hen you have — since that tiiiu^ that you have gained any further 
specific information that Avould shed any further light on the reason 
for those contributions oi- the price sup]X)i-t ? 

Mr. VAN Dyk. Nothing that Avould be firm. My feeling, my strong 
feeling during this entire period Avas that both Mr. Nelson "and Mr. 
Parr Avere extremely hard-working and conscientious on behalf of 
their members. They were also so)neAvhat in awe of the White House 
and of poAver and of — I knoAV oftentimes in the presence of a Sena- 



6991 

tor or Congressman become highly uneasy. They were in a sense coun- 
try boys. 

'l felt that in the presence of the President and/or of White House 
personnel they had overreacted, whether in response to a direct re- 
quest or a false anxiety of their own that they had made the contribu- 
tions, thinking that tliis was in the best interest of their members and 
was the way to achieve their objectives. I thought that they had simply 
been intimidated, either directly or indirectly, into making these con- 
tributions. 

For one thing, I believed — I was amazed — perhaps this is too great 
a conspiracy theory. I was amazed that a Secretary of Agriculture 
would have made the decision that Secretary Hardin made. Tradi- 
tionally the Agriculture Department, as you well know, represents 
the interests of farmere; I mean, farmers are in eifect the Agriculture 
Department's constituency. 

I am not a farm economist, but it was my judgment — and it would 
have certainly been a Democratic administration's judgment, certainly 
the Johnson administration's judgment — that the support level sought 
was justified in terms of increased costs to dairy farmers and current 
supplies of milk. 

Therefore, I was surprised to see Secretary Hardin's decision. And I 
admit to being a partisan liberal Democrat, but I suspected that there 
had been a manipulation of policy to extract from the producers cam- 
paign contributions. That was an impression I had. After reading 
about the large contributions, that was my fear, and I expressed that 
to Mr. Parr and Mr. Nelson. 

Mr. Weitz. Now, let me ask you whether at the time of the activity 
on March 1971, just to try to secure an iner-ease, was there ever any 
discussion as to the likelihood, first, of passage of the legislation that 
dairy j)eople were seeking? 

Mr. VAN Dyk. Oh, yes. I told them in my judgment the legislation 
would be passed, but that in my judgment it would not be passed by 
such a margin that it could override a Presidential veto. 

Mr. Weitz. In that context, was there any further discussion about 
overtures that might be made to the administration in comiection with 
avoiding a veto or otherwise securing favoral)le administrative action ? 

INIr. VAN Dyk. No. No. And again, their method of operation was 
such that I didn't know, although T suspected, that they had counter- 
part Republican consultants. The logislativi^ sessions, the strategy ses- 
sions which I attended with other- consultants, they were always Dem- 
ocrats and discussion was limited to Democrats. 

I assume that later in the day or somewliere else in town or some- 
where they were talking to Republican counterparts. But they were 
hard and fast about the rule of not sharing any discussion about ad- 
ministration or Republican contact with at least me. 

Mr. Weitz. All right. Let's go (jfF the record for a minute. 

[Discussion oil' the record.] 

iSIr. Weitz. INIr. van Dyk, I XAonld like to turn your attention to 
December of 1969. 

Mr. VAN Dyk. Yes? 

Mr. Weitz. At that time, did you receive a request for a payment of 
money from some representative of AMPI? 

Mr. VAN Dyk. Yes, I did. 



6992 

Mr. Weitz. Could yon tell us about that, please ? 

Mr. VAisr Dyk. I received a ]i]ione call in mid-December of 1969 
from one of three people — and T (lon't know which one it was, it would 
have been either Harold Xelson. 1 )avid Parr, or possil)ly Eobert Isham, 
although I think he is the least lil;ely — indicating that there had been 
a decision to give Kobert Lilly an additional $10,000 com]:)ensation. 

That it had been api:)roved by AMPI's officers. That it had to be 
done privatelv and for internal reasons could not be paid as direct sal- 
ary from A^NIPI to Robert Lilly, but that a decision had been made 
to give ]\Ir. Lilly this compensation. Could my firm make a $10,000 
payment to Robert Lilly for which it would be reimbursed ? 

I thought it was an unusual request, but they were disorganized and 
did not operate in exactly a measured way and I said "Yes," I would. 
I then was sent a check for $10,000 which was billed to AINIPI for 
direct expense. I sent, in turn, my company check for $10,000 to Robert 
Lilly. 

I subsequently sent — or at the same time I forget which and I re- 
member there was some urgency about it because they said the pay- 
ment had to be made in calendar year 1969. And they were sending 
me — if I would agree — they wo\ild send me immediate payment so 
that I could, in turn, issue the check to INIr. Lilly, which they did. 

At year's end, I sent the standard IRS form, statement of earnings 
for the $10,000 to Mr. Lilly, since it had been described to me that 
Mr. Lilly was being — this was compensation for Mr. Lilly. A short 
time later I received a call from ^h\ Isham 

Mr. Wkttz. ]Mr. Isham was coni})troller ? 

Mr. VAN Dyk. Yes, comptroller — anirrilv asking me wh}' I had sent 
the IRS statement of earnings form tolNIr. Lilly. 

And I said, "Well, that Avas what you asked me to do was to make 
a payment to him which I did, and I sent him a statement of earnings 
form." And, whereupon, Mr. Isham said "You have caused a great 
deal of trouble for us and we will have to make this up to Bob some- 
how," et cetera and et cetera. 

And I said "Well this would be the only circumstance under which 
I could make this payment." And he grumbled and that was the end 
of that incident. 

Mr. Weitz. All right. Now let's perhaps go through this a little more 
carefully from the outset. 

Mr. VAN Dyk. Sure. 

Mr. Weitz. Do you have any way of knowing or i-ecollecting who 
of the three gentlemen you have mentioned might have called you 
and, in fact did ask you ? 

]Mr. VAN Dyk. If I try to remember — it would have been, I think 
most likely, either Mr. Nelson or ]Mt\ Parr, who I would have assumed 
would have had the authority fo transmit this kind of decision or 
make that kind of decision. 

Mr. Weitz. Was this the first time they made a request of that na- 
ture to you ? 

Mr. VAN Dyk. Yes, it was. I am extremely dubious that it would 
have been !Mr. Isham, aUliouirh I dou't want to say it wasn't, because 
I can't be sure that it Avasn't. Remembering his later call to protest' 

Mr. Weitz. Now perliaps avc can — I Avould like to shoAv you some 
documents for your identification. 



6993 

First we have a — and I won't mark them as exhibits to this session 
since they've already been marked as exhibits to other sessions. 

First I would like to show yon Lilly exhibit i;i^ And it is a voucher, 
a copy of a voucher form from AMPI, actually Milk Producers, Inc., 
dated December 22. 1969, in the amount of $18,050, and a copy of the 
check to Ted van Dyk. And attached to it is a request for a check of 
that date, approved by Tsham, and it says "Charged to account of pro- 
fessional services." And underneath that, handwritten, is "statement 
in mail to San Antonio." Accompanyino; that is your statement, dated 
December 22, 1969, with an accompanying letter. 

Is that a copy of the check that you received and the accompanying 
statement ? 

Now obviously some of the documents you may not be able to iden- 
tify, such as the internal AINIPI documents. 

Mr. VAN Dyk. Sure, this looks like my invoice to AMPI. 

Mr. Weitz. All right. Now what T would like to ask you is. could you 
tell us why the check was sent to vou in advance of your statement to 
AMPI? 

Mr. VAX Dyk. Oh, sure. I probably didn't have $10,000 in the bank at 
that point. 

Mr. Weitz. Just a matter of having it clear ahead of time ? 

Mr. VAN Dyk. Yes. I probably didn't have the money to make the 
payment, so I sent them a bill. 

Normally. I would have billed them quarterly, but as you see I sent 
an invoice dated December 22 for my January-^^arch retainer, which 
would have been for $6,250 and included in the expenses — so the total 
came to $18,050, which Avould have been mv normal invoice with the 
$10,000 added to it. 

Mr. Weitz. xVll right. Now also for purposes of identification, this 
is Lilly exhibit 14.- This is a copy of the front and back of the check 
from you to Bob Lilly dated December 29. 

Mr. VAX Dyk. I'm sure this is the check, sure. 

Mr. AVeitz. That is the $10,000 check ? 

INIr. VAX Dyk. Yes. 

Mr. Weitz. And you say the sequence essentially was just to get you 
the money and you immediately sent a check back to 

Mr. VAN Dyk. So I could send a check back to Lilly. 

Mr. Weitz. Now does the date of December 29, would that indicate 
the date ? Do you recall whether that was approximately the date when 
you sent the check out to Mr. Lilly ? 

Mr. VAX Dyk. I'm sure I sent it immediately, I remember the great 
anxiety to get the money to Lilly before the end of the year and as I 
remember the sequence — I can't be sure, but T think: (1) They made 
the call, made the request to me; (2) they said they were sending the 
money, send us an invoice ; I sent the invoice ; a check arrived ; and 
when their check arrived I sent Lilly a check. I am sure that that is 
what happened. 

Mr, Weitz. Do you know whether ^Nlr. Lilly received the payment 
before the end of the year? 

INIr. VAX Dyk. I don't know, I don't know. 

Mr. Weitz. Did you talk with Mr. Lilly at all during this period? 



1 See Book 14, p. 601'5. 
= See Book 14, p. 6018. 



6994 

INIr. VAX Dyk. I don't recall having done so, althongh I see corres- 
pondence there that — from nie to Lilly. He may have called at some 
point 

Mr. Weitz. Riirht, ])art of Lilly exhibit irj indicates— — 

Mr. VAN Dyk [continiiino-]. To nro-e me to hiirrv up and send a check 
or somethin(>- like that. 

Mr. WEirz. Xow the letter from yon sendino- the invoice dated Sep- 
tember — December 22, part of Lilly exhibit 13, indicates: "Dear 
Harold,'' it's addressed to Mr. Nelson. "Per my discussion today with 
Bob Lillv, T am submitting the enclosed invoice." Do yon recall that 
discussion ? 

Mr. VAN Dyk. T don't, and T assume it was probably Lilly saying 
hurry np and send the money — or here is how the arrangement is to be 
made, et cetera — but it was not Bob Lilly who called me to make the 
original request. 

]Mr. "VViyrrz. Do von remember whether von sent the check directlv 
to ]Mr. Lilly, or to :\rr. Xelson for Mr. Lilly ? 

Mr. VAN Dyk. I don't know. T think I would have — T don't recall. I 
might haA'e — is it that correspondence there which indicates that? 

M]\ Weitz. No ; on the letter, on the copy of the letter to ]Mr. Nelson, 
the back co])y went to Mr. Lilly, that is, of the letter. 

Mr. VAN Dyk. Yes; I might have vSent it to Mr. Nelson at his home. 
T can't remember the exact method of transmission. T know it would 
have either been sent to ^Mr. Nelson in San Antonio or to Mr. Lilly. 
But it was either Mr. Nelson, INIr. Parr or Mr. Isham who made the 
initial request for payment to me. 

I would certainly not have honored Mr. Lilly's request directly 
because T would not be about to send him a $10,000 payment for him- 
self without anybody telling me. 

Mr. Weitz. He Avasn't in that kind of a position of authority as far 
as you understood ? 

Mr. VAN Dyk. No ; I barely knew him. 

Mr. Weitz. "WHiat were his responsibilities? Do von know, at that 
time ? 

Mr. VAN Dyk. So far as I know, he was the staff man for TAPE, 
which was a political organization analagons to COPE. 

Mr. Weitz. Was he an employee of TAPE or an emplovee of AMPI 
at that time ? 

Mr. VAN Dyk. T don't know, T don't know. 

I always thought of TAPE as an arm of AMPI and how he was 
technically employed, I don't know. 

Mr. Weitz. Well if he were employed, at the time, by TAPE, your 
billing and therefore the expenditure would have come from AINIPI. 
Did tliat concern you ? 

]\rr. VAN Dyk. T never thought about it to tell you the truth. I 
though of Bob Lilly as somebody who worked for Harold Nelson in 
San Antonio and was associated with their political activity. T couldn't 
tell you w;, ether he did, or still does, or does now work for TAPE or 
not woi-k for TAPE. l)ut he was their political staff man and T asso- 
ciated him mentally with TAPE and TAPE functions. 

Mr. Weitz. Did you have any awareness or- knowledge of whether 
the moneys you were ])roviding to Mr. Lilly would have any other use, 
such as for political purposes other than those described to you ? 



6995 

Mr. VAN Dyk. No; I never thought of that, frankly, because their 
political funds were so large, I saw no reason that tliey would request 
me to send money for Bob Lilly other than for the reason they gave 
me. It was irregular, but it was, to me, believable. 

Mr. Weitz. Did they ever discuss with you — "they" meaning repre- 
sentatives of the dairy people — at that time, or later, any need for 
money for making cash political contributions at any time ? 

Mr. VAN Dyk. No. 

Mr. Weitz. Were you aware of any outstanding loans or other obli- 
gations that Mr. Lilly had in December of 1969 ? 

Mr. VAN Dyk. I was not. 

Mr. Weitz. Were you aware of any contributions or payments of 
money that had been made on behalf of AMPI or TAPE in 1969 to 
a representative of the President ? 

Mr. VAN Dyk. No ; I was not. 

Mr. Weitz. Do you know whether any other consultants or attorneys 
for AMPI received any similar requests on or around the time that you 
received your request ? 

Mr. VAN Dyk. I do not. 

Mr. Weitz. Did you ever talk with DeYier Pierson about this 
matter ? 

Mr. VAN Dyk. I did not. 

Mr. Weitz. Did you ever talk with Richard Maguire about this 
matter ? 

Mr. VAN Dyk. I did not. 

Mr. Weitz. What about James Jones ? 

Mr. VAN Dyk. No. 

Mr. Weitz. You know Mr. Pierson was retained by them ? 

Mr. VAN Dyk. Yes; I knew all three of those people were retained 
by them. 

Mr. Weitz. I see. Did either Mr. Nelson or Mr. Parr, whomever 
contacted you, or at a later time Mr. Isham, or at any time, Mr. Lilly, 
ever indicate that anyone else had been requested to make payments to 
him for whatever purpose ? 

Mr. VAN Dyk. No. 

Mr. Weitz. Now, you said that either at the time, or shortly there- 
after, at year's end, you sent an income tax form to Mr. Lilly to reflect 
the payment to him ? 

Mr. VAN Dyk. Yes ; I did. 

Mr. Weitz. Now we have a portion of Lilly exhibit No. 15* and it 
consists of two documents, a letter from you to Bob Lilly dated 
March 10, 1970, and a copy B of a form 1099, from Ted van Dyk & 
Associates to Bob A. Lilly, in the amount of $10,000, for commissions, 
fees, et cetera. 

Mr. VAN Dyk. Yes. 

Mr. Weitz. Is this the letter you sent Mr. Lilly, in sending him a 
copy of the form 1099 ? 

Mr. VAN Dyk. Yes, sir, this is it. 

Mr. Weitz. Now I have a couple of questions about the letter. The 
letter, first of all is dated March 10. 

Can you explain why the form was sent to him approximately 21^ 
months after the payment? 

♦See Book 14, p. 6019. 



6996 

Mr. VAN Dtk. No ; I only assumed tliat — my secretary was putting 
together my statement of earnings form, my employees statement of 
earnings forms, and at the same time prepared one for Mr. Lilly. 

Mr. Weitz, Now, at the time when you made the payment to 
Mr. Lilly, did you contemplate sending him a form to cover the pay- 
ment and reflect a commission or a fee of some sort to him? 

Mr. VAN Dyk. I never thought about it. to be frank. I simply — I 
mean we did what we should do in this case. 

Mr. Weitz. T^t me ask you this. You are not an accountant, obvi- 
ously, or an expert, I take it, in income tax matters? 

Mr, VAN Dyk. No. 

Mr. Weitz. Did you discuss this with anybody ? 

Mr. VAN Dyk. With my secretary who took care of our books and 
worked with our accountant and it was made clear at the time the 
payment was made that this was for payment to be handled as a pay- 
ment for services and I explained to her what the situation was. 

Mr. Weitz. You say it was made clear? With the dairy people? 
Nelson and Parr? 

Mr. VAN Dyiv. No — with them, and — well, they told me that it was 
a payment to him for compensation and I so told my secretary and in 
March she issued a statement of earnings form to him and she issued 
one to me. She issued one to herself as she issued one to anybody else 
who worked for me. 

Mr. Weitz. Now the first paragraph reads : "As protection for both 
of us, you will be receiving a withholding slip for the $10.000 — just 
as I received one." 

And the next paragraph : "That closes the circle and keeps us be- 
3'ond question." 

Mr. VAN Dyk. That's right. 

Mr. Weitz. Now can you explain the first paragraph when you say 
"as protection for both of us" ? What did you intend by that phrase ? 

Mr. VAN Dyk. I meant — I don't know, l)ut I assume I meant it's 
something I would have said to mean that this thing has to be done 
straightforwardly and within the law and therefore you are going to 
get a form. 

Mr. Weitz. You had one or more employees at Ted van Dyk Associ- 
ates, at that time? 

Mr. VAN Dyk. That's right. 

Mr. Weitz. Obviously they were in Washington? I'm assuming you 
did not have to mail them your slip in that sense, although you may 
have mailed it to their home address ? 

Mr. VAN Dyk. That's right. 

Mr. Weitz. But did you perceive of those — of sending them their 
statements as protection for them? 

Mr. VAN Dyk. No, but thev were regular emplovees of mine; Bob 
Lilly was not. Bob Lilly worked for AMPI. 

Mr. Weitz. Had you discussed this with Mr. Lilly before you sent 
him the form? 

Mr. VAN Dyk. No ; I did not. 

Mr. Weitz. And when you say at the end of tlie fii-st paragi-aph, 
"just as I received one", Avere you referring to a withliolding foi- you? 

Mr. VAN Dyk. That's right. 



6997 

Mr. Weitz. It had nothing to do with this particular transaction? 

Mr. VAN Dyk. No. 

Mr. Weitz. Your company's books, presumably, reflected the pay- 
ment as a business expense ? 

Mr. VAN Dyk. Sure. 

Mr. Weitz. Now, the second paragraph: "That closes the circle and 
keeps us beyond question." AVhat did you intend by that, or mean by 
that? 

Mr. VAN Dyk. I meant that he had gotten $10,000 from me. It was 
income. I had sent him a statement of earnings form which closed the 
circle. I mean these were the requirements. 

Mr. Weitz. Well, it made the transaction complete, but did you 
feel that without that, there was some serious question as to the pro- 
priety or legality of the transaction ? 

Mr. VAN Dyk. No, but I don't know — I'm not a lawyer, I'm not 
an accountant, but I 

INIr. Weitz. Were you concerned about it ? 

Mr. VAN Dyk. Sure, I would have been uneasy had — I'm sure my 
secretary told me at that time. Again, I can't recall in detail. I'm 
sure she told me that a form had been prepared for Mr. Lilly and I 
was simply sending — this is a letter of transmittal. I mean I assume 
he has to have a form and therefore, there is a form. 

Mr. Weitz. Who was your secretary at that time I 

Mr. VAN Dyk. Ms. Glenda Temple. 

Mr. Weitz. Is she still employed by you ? 

Mr. VAN Dyk. No ; she is not, 

Mr. Weitz. Do you know where she is located ? 

Mr. VAN Dyk.' She is an employee of the House Agriculture 
Committee. 

Mr. Weitz. And she normally handled the paperwork ? 

Mr. VAN Dyk. All the paperwork, accounting, bookkeeping, et 
cetera; yes. 

Mr. Weitz. Now, on or around March 10, when you sent the form 
1099 to Mr. Lilly, was that the same time that you sent the form 1099 
to others who had been employed by you in 1969 ? 

Mr. VAN Dyk. I assume it would have been about the time that she 
put togetlier the withholding slips and we sent one to Lilly as well as 
to ourselves. I am sure it would have been about the time that I got 
mine, sure. Not withholding, but statement of earnings. 

Mr. Weitz. You indicated that after this was sent, you received a 
call from Mr. Isham ? 

Mr. VAN Dyk. Yes ; I did. 

]\Ii-. Weitz. Who was irritated at the fact that you had sent the 
form ? 

Mr. VAN Dyk. Statement of earnings. 

Mv. Weitz, Statement of earnings ? 

Mr. VAN Dyk. Yes. 

Ml'. Weitz. Did that raise a question in your mind as to the veracity 
of the explanation that liad been given to you in December ? 

Mr. VAN Dyk. No; I thought that the explanation was undoubtedly 
correct. That they had intended to pay Mr. Lilly another $10,000 and 
had internal problems, perhaps, of morale vis-a-vis the other staff 
members, et cetera, where they did not want to have it go through 
normal channels. 



6998 

I suspected, liowever, after Mr. Isham's call, that — well, I wondered. 
Did they expect that he was not going to have to pay taxes on the 
$10,000? I mean it was — that was the suspicion that I had. 

Mr. WBrrz. And, in fact, w^hen Mv. Ishani said we will have to make 
it up to Bob somehow — I think was your wording? 

Mr. VAX Dyk. Yes. 

Mr. Weitz. Did that indicate to you that they were going to have 
to pay, or try to cover the income taxes that would — that i\Ir. Lilly 
would incur as a result of having to report your payment to him ? 

Mr. VAX Dyk. TJiat was my inteipretation ; yes. 

Mr. Weitz. Did you ask Mr. Isluim what he meant by that? 

Mr. VAX Dyk. No; I just simply assimied that's what he meant. 

To tell you the truth, 1 was quite annoyed myself. I mean I had done 
what I considered a favor to them and, having done so, I was somewhat 
annoyed that Mr. Isham would call me and complain about it. 

Mr. Weitz. Do you consider eithei- the form or the language of this 
letter that we havedescribed, Lilly exhibit 15,* at all unusual or — given 
the foi'm that you were sending him, or the statement of earnings 
you weie sending him? 

Mr. VAX Dyk. No, I guess the words "for your pi'otection" are the 
important ones, and the statement of earnings certainly was for his 
protection. 

Mr. Weitz. Did there come a time in 1970, when you received — 
subsequent to this conversation with Mr. Isham — when you received 
a refjuest for additional funds ? 

Mr. VAX Dyk. Yes, I did. In September lOTO, I received a call, again 
from one of the thi-ee people in question — it would have been either 
Mr. Nelson, Mr. Parr or Mr. Isham, and I think least likely Mr. 
Isham — a request for another $10,000 payment to Robert Lilly, and 
I recall referring to the 1969 payment and pointed out that, if I made 
any such payment, I would again be sending him a statement of earn- 
ings form to ]Mr. Lilly, to which the response was, "Well, we can't do 
it that way this time. Can you write a personal check to Mr. Lilly 
and we will reimburse you?'' I said: "If I were to write a personal 
check to Ml'. Lilly, it would raise my income considerably — it would 
raise my tax bracket considerably — and you w^ould have to pay me far 
bey ond'$l 0,000 to reimburse me "for my sending $10,000 to Bob Lilly." 

And whoever the person was, pressed me, and said, "Well, have you 
got an employee in a lower tax bracket who could write a $10,000 
check to Bob Lilly and we would make payment to him plus whatever 
difference was necessary to meet his taxes ?'' 

And I said, "Well, isn't this a clumsy, silly way of making this pay- 
ment? Can't you just do it directly?'' And he said, "No, we're faced 
with the same situation — internal problems and so on." And I said, 
"Well, I will ask someone who works for me and I will let you know." 

I asked Kirby Jones, who worked for me. Kirby said he would be 
willing to do so and he estimated it would take a payment of $12,000 
to enable him to make a $10,000 payment to Mr. Lilly. Whereupon, he 
wrote a $10,000 personal check to Mr. Lilly. I i-ecall specifically saying 
at the time that T called AMPI back to say that Mr. Jones woiild send 
the $10,000 check, that even though Mr. Jones is not a corporation and 
doesn't issue earning statements, it's going to be Bob Lilly's respon- 

•See Book 14, p. 6019. 



6999 

sibility to declare this as income. And they said don't worry about 
that. 

So Kirby sent, as I recall, a $10,000 check to Bob Lilly. 

Mr. Weitz. I would like to show you exhibit No. 16 ^ from the Lilly 
executive session, dated — it's a copy of a voucher and check, dated 
September 4, 1970, to Ted van Dyk'& Associates, Inc., for $19,055.72. 
And attached to it is a letter from Ted van Dyk to Bob Lilly, dated 
Auf^ust 27, 1970, and it enclosed a billing from Ted van Dyk Asso- 
ciates to A]\IPI for that amount. 

Is that the copy of the check you received and the billing and letter 
yousenttoAMPi? 

Mr. VAN Dyk. Yes, this seems to — must be it, it's my signature and 
my letterhead. 

Mr. Weitz. Now, in the letter from you to Bob Lilly, again it begins : 
"Dear Bob : Per our discussion earlier today, please see the attached 
invoice for processing." 

Let me ask you several questions. 

First of all,' do you recall a conversation with Mr. Lilly in connection 
with this transaction? 

Mr. VAN Dyk. No, I do not, although the letter indicates I must 
have had one. 

I would — again, the original request I am sure came from one of the 
other three people. 

Mr. Weitz. Nelson, Parr or Isham ? 

Mr. VAN Dyk. Or Isham, in that order of likelihood. 

Again, I am assuming, as per the earlier occasion, that Lilly called 
to follow up and discuss the transfer. 

Mr. Weitz. Now, also, for purposes of completeness, I will mark 
this as exhibit No. 1 for your executive session, a copy, front and back, 
of a check from you to Kirby Jones, dated September 11, 1970, in the 
amount of $12,000. 

Is that a copy of your check ? 

[l\Tiereupon, the document referred to was marked Van Dyk ex- 
hibit No. 1 for identification.-] 

Mr. VAN Dyk. Yes, that is correct. 

Mr. Weitz. And that represents the $12,000 payment that you made 
to Mr. Jones? 

Mr. VAN Dyk. That represents the $12,000 payment which enabled 
Mr. Jones to send $10,000 to Mr. Lilly. 

Mr. Weitz. And finally, we'll mark as exhibit 2 to your testimony, 
a copy of the form 1099 and wage and tax statement for Mr. Jones 
for tlie calendar year 1970, the form 1099 covering the $12,000, and 
the wage and tax statement for the remainder of his earnings for that 
year. 

Are those the statements that you submitted to him? 

[Whereupon, the documents referred to were marked Van Dyk ex- 
hibit No. 2 for identification.^] 

Mr. VAN Dyk. I am sure they are, I am sure they are. 

Mr. Weitz. Is it your recollection that again you requested that 
payment be made to you before you made payment to Mr. Jones ? 



1 See Book 14, p. 6021. 

2 See p. 7043. 

3 See p. 7044. 



7000 

Mr. VAN Dyk. Probably, I think it would have been the same cir- 
cumstance, that in the sizable sum of $10,000, I didn't want to pay it 
out before receiving it. 

Mr. Weitz. Was there any urgency in connection w^ith this request ? 
As you indicated, there was with the other request. 

Mr. VAX Dyk. Not to my recollection, I knew there was an urgency 
on the 1969 check. 

Mr. Weitz. Was there any explanation — do you know whether 
AMPI is on a calendar year or a fiscal year basis for accounting 
purposes ? 

Mr. VAN Dyk. I have no idea. I assume the first urgency was that they 
wanted — the 1969 urgency was that they wanted Lilly to be paid in the 
calendar year 1969. 

Mr. Weitz. Well, that was in fact what they told you ? 

Mr. VAN Dyk. That's right. 

Mr. Weitz. Did it have any relationship, for example, to book- 
keeping for AMPI, or otherwise ? 

Mr. VAN Dyk. I have no idea. 

Mr. Weitz. Was there any indication to you as to why this request 
came apparently sometime in August of 1970 ? 

Mr. VAN Dyk. No, no. 

Mr. Weitz. At that time, were you aware of either any obligations 
on Mv. Lilly's part, or any political contributions that he was making 
with moneys he was receiving from you or others ? 

Mr. VAN Dyi^;. No. 

Mr. Weitz. Did you know Mr. Stuart Eussell ? 

Mr. VAN Dyk. No. 

Mr. Weitz. Were you aware of any moneys that Mr. Eussell was pay- 
ing, either to Mr. Lilly or others, for political purposes ? 

Mr. VAN Dyk. No, the first I heard of Mr. Russell was in reading the 
press reports in the press recently. 

Mr. Weitz. You indicated that with the second request that was 
originally made for you to make a payment directly or personally, I 
should say, to ^Iv. Lilly, your response was that your — because of your 
income tax bracket and so forth, it would be aw^fully expensive, both 
for you and then ultimately AMPI, to make that payment. 

Mr. VAN Dyk. Because I would assume they would have to reim- 
burse me, yes. 

Mr. Weitz. Was there any discussion, similar discussion or arrange- 
ment, in connection with the first payment? 

Mr. VAN Dyk. No. 

Mr. Weitz. I understand from what you said that for the first por- 
tion of the period, the number of years when you were retained by 
AMPI, your retainer was $6,250 a quarter ? 

Mr. VAN Dyk. Right, it was $25,000 on an annual basis, sure. 

Mr. Weitz. All right. Now in Lilly exhibit 18 which we have al- 
ready looked at, the $18,000 — $18,050" invoice from you on December 
1969, that covers two items, the retainer January through March would 
account for $6,250, and expenses October through December which 
would be the remaining $11,800. 

Now you have accounted for $10,000 of that as a payment that you 
made to Mr. Lillv. Do you have any records to account for the remain- 
ing $1,800 of that ? 



7001 

Mr. VAN Dyk. Oh, I am sure they are out-of-pocket for travel, or 
luncheon, or dinner, which I felt would have been the expenses out-of- 
pocket for the previous 3 months, which is how w-e handled it. 

It would certainly not have had any — I mean there was no discus- 
sion or consideration of — I needed it to cover taxes. After all, it was 
handled as a business discussion. 

Mr. Weitz. Could we go off the record ? 

[Discussion off the record.] 

Mr. Weitz. Mr. van Dyk do you have any records, expense records 
or firm records, from 1969 ? 

Mr. VAN Dyi^. I don't any longer, no. 

Mr. Weitz. All right, I think the record should show, as counsel for 
the witness has indicated, that other billings submitted to the com- 
mittee, billings to AMPI, copies of which have been submitted to the 
committee, indicates that expenses — direct expenses were normally 
billed also to AMPI? 

Mr. VAN Dyk. Sure, as with all my clients. That is my standard 
billing procedure. 

Mr. Weitz. And you recall nothing unusual about the billing at this 
point ? 

Mr. VAN Dyk. No. 

Mr. Weitz. Do you recall any services or actual trips or meetings 
that you engaged in on their behalf in the last quarter of 1969? 

Mr. VAN Dyk. Normally I would make one or two trips a month, 
somewhere, on their behalf, whether it be San Antonio or Little Kock 
or some other point where a meeting was taking place. As I indicated, 
I had begun at that period a series of dinners and luncheons with 
Senators and Congressmen at the JNIadison Hotel which were relatively 
expensive. So $1,800 would have been a normal direct expense for that 
billing period. 

Mr. Weitz. Off the record. 

[Discussion off the record.] 

Mr. Weitz. Just a few more questions witli respect to this August- 
September transaction. 

You say Mr. Jones estimated that an additional $2,000 would be 
needed to cover his excess taxes as a result of the transaction ? 

Mr. VAN Dyk. Yes. 

Mr. Weitz. Do you know how he computed that, or figured that ? 

Mr. VAN Dyk. I don't know. I think it was just an estimation of 
his. 

Mr. Weitz. Now exhibit 2, which we have looked at, is a copy both 
of his wage and tax statement from you and also the form 1099, indi- 
cates Federal income taxes of approximately $3,000 on income of 
approximately $18,500, before the payment and information provided 
to us by Mr. Jones, I believe he incurred additional taxes of over 
$3,000. 

I am not a tax expert, to determine whether it is all related to the 
$12,000 payment, but to the extent there was an excess tax due in addi- 
tion to $2,000, did you or he ever discuss the matter further? 

Mr. VAN Dyk. Well I would have made it up to him if that had been 
the case, I don't recall that I did, but if he had in^curred an excess tax, 
I would have paid it to him to meet my obligation to him. 



7002 

Mr. Weitz. He never came back and discussed the matter with you ? 

Mr. VAN Dyk. I don't recall. 

Mr. Weitz. Did he ever ask you at any time after that any further 
details about the transaction ? 

Mr. VAX Dyk. No— well, look, since 1971 and the press coverage and 
so on, of course, both of us have speculated often as to what really 
happened to these two $10,000 checks. It is obvious. But our under- 
standing at the time, in both cases, was that these were for compensa- 
tion, personal compensation, to Bob Lilly. 

Mr. AVarnke. Could I make a comment? 

Mr. Weitz. Yes. 

Mr. Warxke. I don't think there's anything in this exhibit 2 which 
would lead to the conclusion that the total tax on the $18,541 would be 
the $2,945. That's just the amount of withholding. 

Mr. Weitz. That's right. 

Mr. Warxke. And I think it's a frequent practice that you don't 
have withheld the total amount of the tax that you pay. In other words, 
back in the days when I had a withholding statement, I can't think of 
any instance in which I did not owe additional tax at the end of the 
year. And I haven't calculated it, but it seems to me highly unlikely 
that he would have as little a tax as $3,000 on income of $18,500 with 
only one child. 

So I would suspect that the $2,000 probably amply compensated 
for the additional tax he paid on the $12,000. 

Mr. Weitz. All right, have you ever seen a copy of the check which 
Mr. Jones presumably sent to INIr. Lilly ? 

Mr. VAX Dyk. Yes; I have. You have that, I believe, don't you? 

Mr. Weitz. Yes. 

Let me — if you can identify it, I will mark it as exhibit 3 even 
though it's not your check. 

[Whereupon, the document referred to was marked Van Dyk ex- 
hibit No. 3 for identification.*] 

Mr. VAX Dyk. ]Mr. Jones showed me the check. 

Mr. Weitz. Let me sliow you a check from Mr. Jones to Bob Lilly, 
dated September 9, 1970, in the amount of $10,000. 

Is exhibit 3 a copy of the check Mr. Jones showed vou ? 

Mr. VAX Dyk. Yes, it is. 

Mr. Weitz. Were there any further requests, other than the two 
you have described of you, for payments to an emplovee of AMPI ? 

INIr. VAX Dyk. No. 

Mr. Weitz. What about any other consultants or attorneys of 
AMPI? • ^ 

Mr. VAX Dyk. No. 

Mr. Weitz. Did anyone at AMPI or the other two dairy co-ops we 
have referred to, Mid-America or Daiiymen, Inc., ever ask vou to 
make payments directly to some political committee or political 
candidate ? 

Mr. VAX Dyk. No. 

Mr. Weitz. Did they ever, any of those organizations or any of 
their representatives, ever ask you to make expenditures on their 
behalf for a political purpose? 

•See p. 7045. 



7003 

Mr. VAN Dyk. No. 

Mr. Weitz. May we 0:0 off the record ? 

[Discussion off the record.] 

Mr. Weitz. I would like to turn your attention to one or more polls 
which you commissioned on behalf of AMPI. First, I would like to 
ask you whether you commissioned a poll by the Gallu]) orcjanization 
for them in several States ? 

Mr. VAX Dyk. I did, yes. 

Mr. Weitz. And was tliat poll in connection with the Presidential 
campaign of 1972 ? 

Mr. VAN Dyk. Not in that connection. It was to measure the popu- 
larity at that point of several Democratic possibilities in the St^ates of 
Wisconsin and West Virginia. I think the poll was — what, January — 
December of 1970 was it? 

Mr. Weitz. Well, we can mark this as an exhibit for identification. 
I will mark as exhibit 4 a check signed by Glenda Temple, but on a 
check of Ted van Dyk Associates to Public Opinion Surveys, in the 
amount of $12,000, dated December 16, 1970. 

Is that a copy of the check that Avas submitted to them? 

[l^Hiereupon, the document referred to was marked Van Dyk ex- 
hibit No. 4 for identification.^] 

Mr. VAN Dyk. I am sure it is, yes. 

Mr. Weitz. And this is— let me mark as exhibit 5, an invoice — I 
believe this looks like an original from the Gallup organization, Ted 
van Dyk Associates, dated Januarv^ 11, 1971, in the aniount of $12,000, 
for professional services in connection with the polls in West Virginia 
and Wisconsin. 

Is that a copy or is that the billing that was submitted to you? 

[Whereupon, the document referred to was marked Van Dyk 
exhibit No. 5 for identification.^] 

Mr. VAN Dyk. That is it, yes. 

Mr. Weitz. Now finally, I would like to show you and mark as an 
exhibit, as exhibit fi, a copy of an AMPI check and voucher and an 
attached billing. The check "is dated December 11, 1970. Your billing is 
December 1, 1970. And both in the amount of $19,573.08, with "direct 
expense due" of $14,244.66. 

Is that a copy of your billing and a check which you received from 
AMPI? 

[Whereupon, the document referred to was marked Van Dyk 
exhibit No. 6 for identification.^] 

Mr. VAN Dyk. I am sure it is. 

Mr. Weitz. Is the direct expense due item of $14,000, does that in- 
clude the $12,000 expenditure ? 

Mr. VAN Dyk. I am sure it does, I am sure it does. 

Mr. Weitz. Now there again, your billing to them and the retuni 
check predates the — I believe it predates the — -— 

Mr. VAN Dyk. December 1 is the billing and the check was, my check 
to them was 

Mr. Weitz. Your check to Public Opinion Surveys was on Decem- 
ber 16, so that it would have just predated it. 

Mr. VAN Dyk. That's right. I sent the invoice on the 1st, they sent 
me the AMPI check and I paid Gallup on the 16th. 



1 See p. 7045. 
= See p. 7046. 
' See p. 7047. 



7004 

Mr. Weitz. By way of back^Tound, would you tell us who at AMPI 
asked you to commission the poll ? 

Mr. VAN Dyk. I believe I commissioned the poll. There were re^ilar 
discussions of possibilities of who migrht be the Democratic nominee 
in 1972. I recall in one session, attended by Mr. Nelson, Mr. Parr, and 
myself, there w^as speculation by them as to what would be helpful 
in helping us to determine how thinjrs were cfoin^ bevond our judg- 
ment and the judgment of other people and I said, "Well, one way 
you can find out would be to — and it is far too early — but some indi- 
cation could bo gained from in-depth studies, not only of popularity 
but of analysis of personal characteristics, voters' perception, et cetera, 
of the Democratic candidates who might be entered in the pivotal 
primaiy States of Wisconsin and West Virginia." 

And they said, "How much would that kind of poll cost?'' and I 
said, "I'll check with Grallup." T did and thev OK'd the expenditure 
and we had the poll done, a copy of which you have. 

Mr. Weitz. Yes. Do you recall whether it was both Mr. Nelson 
and Mr. Parr, essentiallv, who approved it ? 

Mr. VAX Dyk. T think it was. In my recollection, I think it was. 

Mr. Weitz. Was there any reason that in your billing, exhibit 6, to 
AMPI, is not addressed to either Mr. Nelson or Mr. Parr? 

Mr. VAX Dyk. I alwavs made the billing according to what they told 
me at the time — for a time the bills were sent to Mr. Nelson, for a time 
they were sent to JNIr. Parr, I don't know where that one went. 

Mr. Weitz. That was just generally. Associated INIilk Producers, 
fourth floor? 

Mr. VAX Dyk. Right. 

Mr. Weitz. At tiie time when they asked you to, or agreed that the 
poll should be commissioned, and you discussed it with them, did vou 
discuss with them or did they suggest anv additional benefit that 
might accrue to any candidate, Pivsidential candidate, or possible 
Presidential candidate ? 

Mr. VAX Dyk. No. No ; it was wholly for 

]\Ir. Weitz. As far as you understood and as far as they understood, 
it was to be used solely for internal purposes ? 

Mr. VAX Dyk. That is correct. 

Mr. Weitz. "Wliat did you perceive to be the purpose for which they 
would use the poll ? 

Mr. VAX Dyk. I thought that they wanted to know to whom they 
should pay attention. What priorities they should give their contact. 
They knew full well that their industry was dependent upon the de- 
cision of tlie President, whoever he might be, and they had a lively, 
and I though i-ightful interest in who a possible Democratic nominee 
miffht be. 

INIr. Weitz. Noav, of course, this was commissioned nearly 2 yeai^s 
ahead of the 1972 election ? 

Mr. VAX Dyk. That's right, but onlv a vear ahead of, reallv, the 
primary period. In other words, Maivh 1972 Avas the fij-st ])rimaiy. 
The campaigns would probably be getting underway in mid-1971 
sometime, so it was a timely poll. 

Mr. Weitz. Was this with a view toward advising them or them- 
selves takin<r advice as to who to make contributions to ^ 



7005 

Mr. VAN Dyk. Possibly, I think it was more an overall assessment of 
just what the possibilities were. 

Mr. Weitz. Well, besides the curiosity factor, what did you perceive 
to be the concrete uses to which it could be, or probably would be, put? 
Mr. VAN Dyk. Well, as I indicated, a contribution mio-ht be one 
possibility. Another mi^ht be the amount of speakers they might want 
to invite to their reo;ional national meeting:s, emphasis they might 
want to place on contact when they were in Washington, people in 
their organization who might or might not have acquaintance with 
these various possible contenders. 

T think they had every right to know the realities of the situation 
within the Democratic Party. As it turned out, as the poll showed, the 
final outcome was, you know, directly the opposite of what the polls 
indicated. 

INIr. Weitz. In December of 1970, or slightly in advance of that, when 
the poll was actually — can you remember when exactly the poll was 
commissioned ? 

Mr. VAX Dyk. It would have been right 

Mr. Weitz. How long did it take to have the poll taken and billing 
sent to you ? 

Mr. VAN Dyk. I'm sure the poll itself would have taken a couple — 6 
weeks probably. 

Mr. Weitz. T>o you normally have to pay in advance? 
Mr. VAN Dyk. Yes, because they have to pay their interviewers and 
their field staff and they simply can't do that out of pocket. 

Mr. Weitz. Rut you normally at least receive an invoice in advance 
of payment? In other words, what we have here, exhibit 5, the invoice 
to you from Gallup is dated January 11. Your check is dated Decem- 
ber 16 of the previous month, and I'm just wondering — they just told 
you informally? 

Mr. VAN Dyk. Yes ; and I sent them the money so they could get 
going, and in the course of time I guess the invoice came. 

Mr. Weitz. In December of 11)70 and November of 1970, when the 
poll was commissioned and you paid for it and billed AMPI, were 
you aware of any pledges that AMPI or others had made to repre- 
sentatives of the administration for substantial political contributions 
to President Nixon's reelection effort ? 
Mr. VAN Dyk. I was not. 

Mr. Weitz. Did Mr. Nelson or Mr. Parr or any others indicate that 
they wanted to go ahead and make contributions to Democratic Presi- 
dential candidates in 1972 ? 

Mr. VAN Dyk. No ; I assumed that they would, simply because in 
19G8 thoy had supported the Humphrey'-lMuskie ticket and I knew 
both Mr." Nelson and INIr. Parr personally to be Democrats. I also knew 
tliat they were dissatisfied with Nixon administration fann policy, so 
it was my surmise that they would give what support they could to 
the Democratic nominee. 

Mr. Weitz. Do you have any notion of what the amount of that 
supi^ort might be? 

]\fr. VAN Dyk. I had no idea, I frankly hoped it would be generous. 
Mv. Weitz. Did you know what, or have any idea of what, the re- 
sources or contributions in the Presidential campaign of 1972 would 
l>eof TAPE? 



7006 

Mr. VAisr Dyk. T did not. I knew that TAPE, thronofh the checkoff 
system, generated an awful lot of money and T don't know the total. 
I did know, from public record, what their 1070 contributions were, 
and they were sizable, and I assumed tliat as a ijrowinof orpmization 
they liad even more resources to put into tlie 1072 campaip:n. 

Mr. Weitz. And neither Mr. Nelson nor Mr. Parr said anything 
to vou to negate that inference ? 

Mr. VAN Dyk. No. 

]\Ir. Weitz. After receiving the poll, or even in advance of that, did 
you discuss the fact that the poll was lieing taken or the results of the 
poll with any then-Presidential candidate or possible Presidential 
candidates ? 

Mr. VAX Dyk. No ; I did not. 

Mv. Weitz. ^^Hiat about any of their representatives ? 

Mr. VAX Dyk. No. 

Mr. Weitz. My question was whether you discussed it either before 
receiving the results of the poll or after receiving the poll ? 

Mt'. VAX Dyk. After receiving it; yes. 

Mr. Weitz. I'm sorry, let me ask that again. After receivinflf the 
poll, did you discuss tlie results with representatives of possible Presi- 
dential candidates? 

Mr. VAX Dyk. Sure — and I can be quite specific. The poll, as I recall, 
arrived in a larire box either the dav after or the day before our break- 
fast meeting which was scheduled with Ser.ator JNIcGovern and Mr, 
Pai-r. Mr. Nelson, and various officers as I recall of AMPI and/or per- 
haps the other co-ops. 

The breakfast was at the Madison Hotel. I had with me several 
summaries of the poll and I gave them to "Sh: Nelson and Mr. Parr and 
told them that the poll had arrived and I would be f orAvarding the poll 
to them — or perhaps T had given them their copies then, I can't recall. 

On leaving the breakfast, it suddenly occurred to me as T left the 
room, I turned to Mr. Nelson and T said, "Do vou have any objection if 
I share a summary of this poll with Senator McGovern?" since he had 
been our breakfast guest at that time, and he said, "No, I don't see any 
reason why not." 

So I gave McGovern — at that moment as we left the breakfast in the 
elevator and saw him back to the lobby — I gave him a summaiy copy 
of the poll. 

Some weeks later — and I knew that Senator INfcGovern was a pos- 
sible candidate — several weeks later I was having luncheon with David 
Burke, who at that time was administi-ative assistant to Senator 
Kennedy whom I did not regard as a candidate or as a potential can- 
didate, but because the poll contained some information which would 
have been pei-sonally encouraging to Senator Kennedy, and T thought 
good for his morale, T mentioned the poll to Mr. Burke and gave him 
a copy of the summary and Mr. Burke gave it to Senator Kennedy. 

]\rr. Weitz. And did you subsequently inform or ask to get the au- 
thorization of 

Mr. VAX Dyk. T told the AMPI people that I had, in fact, given a 
copv of the sununary. 

Mr. Weitz [continuing]. Get the authorization of AMPI? 



7007 

Mr. VAN Dyk. Yes, after the fact. I did not, before the fact, check 
with the AMPI people on the distribution of the jwll to Senator Ken- 
nedy because they had been so forthcoming on the copy to Senator 
McGovern. I did, however, after I had given the summaiy to Senator 
Kennedy, inform them that I had done so and they were approving 
of it. They had no objection to it. 

Mr. Weitz. And the poll was commissioned — or at the time that you 
received the authorization from representatives of AMPI to do so — 
was there any— was it your intention that the results of the poll would 
be shared with or distributed to possible political candidates or Presi- 
dential candidates? 

Mr. VAN Dyk. No, it was wholly for AMPI's internal use. 

Mr, Weitz. And neither Mr. Nelson nor Mr. Parr indicated to you 
that they would be willing to or hope to share the results of the poll, 
at the outset, with such candidates at the end of it? 

Mr. VAK Dyk. No, no, it was never discussed. As a matter of fact, the 
first sharing of it was one that was an impulse under the circumstance 
wherein I gave the copy of the summary to Senator McGo^^ern. 

Mr. Weitz. In exhibit 6, by the way, besides the expense due that 
you indicate covers the cost of the poll, there is a direct expense of 
November of $5,328.42. 

Mr. VAN Dyk. Would that be for that month alone? Let me see. 

Mr. Weitz. That's what the billing indicates, and I was wondering 
whether you have any recollection of what that represents. 

Mr. VAN Dyk. We have notes here. My guess is it would have been 
a payment to John Kraft for a poll in the State of Arkansas. 

Mr. Weitz. That would have been at the same time ? 

Mr. VAN Dyk. Yes. Payment was made in 1970 and that would have 
undoubtedly been that 

Mr. Weitz. Do you have any separate documentation for that poll ? 

Mr. VAN Dyk. I don't have the poll. That was to endeavor to the 
AMPI people in its entirety and it's a poll internally inside the State 
of Arkansas and it was on all possible candidates in statewide races 
in that State and they worked with Kraft and paid him and was reim- 
bursed. 

Mr. Weitz. Did that have any connection to the Presidential cam- 
paign of 1972? 

Mr. VAN Dyk. No, no. 

Mr. Weitz. Was it in any way commissioned for or hoped to be 
shared with in connection with Congressman Mills, in connection with 
his Presidential eifort? 

Mr. VAN Dyk. No, no. 

Mr. Weitz. All right, now I would like to turn your attention to 
some work you commissioned on behalf of AMPI with Charles Mickel, 
M-i-c-k-e-1. in South Dakota. 

I would like first to show you, and mark as exhibit 7, a letter — an 
invoice in the form of a letter — dated September 16, 1971, from 
Charles Mickel to you for professional services rendered: legal re- 
search, consultation and advice, $2,-357. sales tax at 5 percent, $142.85, 
for a total of $2,999.85. 

Is that a copy ? Is that the invoice you received ? 

[Whereupon, the document referred to was marked Van Dyk exhibit 
No. 7 for identification.*] 

♦See p. 7049. 



7008 

Mr. VAN Dyk. That is correct. 

Mr. Weitz. "Who asked yon to commission tliat work? 

Mr. VAN Dyk. That was Mr. — I believe it's Mickel, He was a friend 
and associate of Representative Abonrezk who is now Senator Abou- 
rezk who was a friend of mine. And Jim Abonrezk asked one day at 
kmch, he said, "I have a friend who is an attorney and who could 
badly use some legal work. Do you have a client who could use him?" 

I checked with the AMPI people. 

They said they could use an updated survey of milk marketing and 
other regidations governing them in the State of South Dakota. And I 
called Mr. Mickel and he said he could do the job for that amount. 

I cleared back with AMPI and he, in fact, undertook the study 
which I forwarded to AMPI and he was paid in that amount. 

Mr. Weitz. Did you bill AMPI for this payment ? 

Mr. VAX Dyk. Yes. I did and then I, in turn, paid Mickel. 

Mr. Weitz. Did that have any connection with the Presidential 
campaign of 1972? 

Mr. VAN Dyk. No, it did not. 

Mr. Weitz. Now did you ever have occasion to commission work 
with Kenneth Olson on behalf of AMPI ? 

Mr. VAN Dyk. Yes, I did. It was in — well, you have the record there. 

Mr. Weitz. Let me mark this as exhibit 8 — and exhibit 8 appears to 
be a copy of a check and voucher from AMPI to you for $2,500. It is 
dated August 7, 1970, and it reflects payment to Kenneth Olson of 
$2,500. 

[AVliereupon, the document referred to was marked Van Dyk exhibit 
No. 8 for identification.^] 

Mr. VAN Dyk. I made two payments for $2,500 to Mr. Olson in the 
summer of 1970. The circumstances of that were as follows. 

I received a telephone call from the Senate Deiriocratic Campaign 
Committee indicating that Mr. Olson was a friend and associate of 
Phil Hotf in Vermont, and that Mr. Olson, whom I knew and had met 
during the 1964 Presidential campaign, was seeking retainers and busi- 
ness and needed some help and could I check with AMPI and/or other 
clients to see if there was any work that could be undertaken in their 
behalf. 

I did check with them and as a result Mr. Olson filed periodic re- 
ports on political developments in the New England States which were 
forwarded to the AMPI people and I made two payments to him for 
which I was reimbursed at $2,500 each. 

Mr. Weitz. Let me mark also exhibit 9 and show ,you both exhibits 
8 and 9. 

Exhibit 9 is an expense voucher and check of June 12, 1970, to you 
and it includes an item of direct expense and on the attached invoice 
from you to AlSfPI it shows, consultant fee : Mr. Olson, $2,500. Do 
these two reflect the $2,500 billings to AMPI ? 

[Whereupon, the document referred to was marked Van Dyk exhibit 
No. 9 for identification.^] 

Mr. VAN Dyk. Yes, I'm sure, July 31 and June 8, yes. 

Mr. Weitz. Now, was the purpose of these consultations or ad^-ice 
that ^Ir. Olson provided them fi-om time to time, in any way connected 

1 Spp p. 7050. 

2 Soe p. 7052. 



7009 

to — more or less a preview of an analysis of possible primary elections 
in those States? 

Mr, VAN Dyk. Yes, in other words the political situation as to pri- 
mary and general election outlook in the New England States. And he 
sent me several of these which I then forwarded to them. 

Mr. Weitz. Do you know, again, for what purpose those were used 
by AMPI? 

' Mr. VAN Dyk. I assumed that they were interest<^d in those States 
and were the possible reelection prospects of Senators and Congress- 
men who were already there, statewide officeholders who were already 
there, and general informational purposes as for instance the Presi- 
dential poll gave them insights into what would be — 

Mr. Weitz. Well, Mr. Olson's reports, did they also cover prospects 
for the Presidential primaries ? 

Mr. VAN Dyk. No, they did not. This was, again, the summer of 1970. 

Mr. Weitz. So, to the best of your knowledge, this had nothing to 
do with the 1972 Presidential campaign ? 

Mr. VAN Dyk. There was nothing to do with the Presidential cam- 
paign in any of those reports. 

Mr. Weitz. Now, in addition to the transactions and other services 
which you either performed or commissioned for AMPI, are there any 
other services or other work that you either performed or commis- 
sioned for them in connection with the 1972 Presidential campaign? 

Mr. VAN Dyk. No. 

Mr. Weitz. Any other expenditures that they made that you were 
aware of in connection with the 1972 Presidential campaign? 

Mr. VAN Dyk. No. 

Mr. Weitz. Did you make any solicitations for contributions to a 
Presidential candidate, contributions from either TAPE or AMPI 
or the other dairy co-ops to a Presidential candidate in the 1972 
campaign ? 

Mr. VAN Dyk. On behalf of a Presidential candidate? 

Mr. Weitz. Yes. 

Mr. VAN Dyk. No. Obviously I worked as director of issues and 
research for the McGovern-Shriver campaign. The only circumstances 
there, was that during the summer I received a call from George 
Mehren, general manager of AlVIPI, asking if I could arrange a meet- 
ing for AMPI's staff and officei-s with Senator McGovern during the 
time he was visiting President Johnson in Austin, and I said to Mr. 
Mehren that, in fact, I wanted to take a step back in this since I'd had 
a previous professional relationship with AMPI and I would put him 
directly in contact with Mr. Steve Robins who was the director of 
scheduling for the campaign, and that Mr. Robins would call him. 

In the meantime, I told Mr. Robins that AMPI had had the em- 
barrassment of the Nixon contributions and so on, and that I would 
advise INIr. Robins to use extreme caution in scheduling such a meeting. 

He checked with Senator INIcGovern, however, and the meeting was 
held, and I understand that Mr. McGovern in fact solicited a contri- 
bution at the meeting, but no contribution was made to my knowledge. 

^h'. Weitz. Was the meeting just with Dr. IMehren as the repre- 
sentative of the dairy ? 

Mr. VAN Dyk. No'i It was Dr. Mehren and as I understood it, AMPI 
officers, directors, and a large number of people. 



30-337 O - 74 - Bk. 16 - 6 



7010 

Mr. Weitz. And this took place in San Antonio ? 

Mr. VAN Dyi^. No ; in Austin I believe, while Senator McGovern was 
visitino; President Johnson. 

Mr. Weitz. Was this the same day, do you know ? 

Mr. VAN Dyk. I don't know. It would have been the same day, eve- 
ning before, et cetera, but I believe it was at the motel where he was 
stayino;. It was arranged either before or after his visit witli President 
Johnson, and that was — I did not regard that as a solicitation by me 
on behalf of Senator McGovern. 

I did, however — I was instrumental in establishing contact which 
led to the meeting. 

Mr. Weiiz. Now, did you solicit or have any role in any contribu- 
tions by TAPE or the other dairy co-ops to Senator Humphrey's 
Presidential campaign? 

Mr. VAN Dyk. No ; I did not. 

Mr. Weitz. ^Hiat about Congressman Mills' campaign? 

Mr. VAN Dyk. No ; I did not. 

Mr. Weitz. Any knowledge of any contributions by the dairy co-ops 
to those — to their Presidential campaiinis? 

Mr. VAN Dyk. No, no, none that I — you know, whatever they de- 
clared was in the public record, I assume they made. 

Mr. Weitz. Now what about with respect to Senator Muskie's Presi- 
dential campaign ? 

Mr. VAN Dyk. No. I have no knowledge. I mean, they may have. 

Mr. Weitz. Would any contributions — well, did you solicit contri- 
butions in — could we go off the record a minute ? 

[Discussion off the record.] 

Mr. Weitz. Now, I take it the answer to the last question would 
apply to any 

Mr. VAN Dyk. Any Democrat. I mean, the only instance that I know 
of was the one I related, which was my part in arranging the meeting 
in Austin, I believe. 

Mr. Weitz. Would any solicitations that you made for contributions 
to any senatorial campaigns in 1970 have been related in any way to 
your knowledge or gone to the Presidential campaigns of any Demo- 
cratic candidates in 1972 ? 

Mr. VAN Dyk. Not to my knowledge. I solicited, as you know — not — 
solicited is a bad word. I recommended a number of AIMPI contribu- 
tions to senatorial campaigns in 1970, and many of them were made. 

Mr. Weitz. Rut to your knowledge, your efforts were not connected 
with either soliciting moneys to be used for the Presidential campaign 
of 1972 or to your knowledge, none of those moneys were in fact used 
in those Presidential campaigns. 

Mr. VAN Dyk. No, no. 

Mr. Weitz. All right. Let's go off the record. 
[Discussion off the record.] 

Mr. Weitz. T\nien was your relationship with AMPI terminated? 

Mr. VAN Dyk. In February of 1972. 

Mr. Weitz. And could you tell us the circumstances or the reasons 
for that? 

Mr. VAN Dyk. I cei+ainly can. I received a form letter signed by 
Eobert Isham at the end o^^ February 1972 informing me, as I as- 
sumed — it was an obvious form letter informing others, saying that 



7011 

the directors had met and they had terminated all consultancies, and 
that they would be happy to continue working witli me on an ad hoc 
basis as projects arose, but this was news that no further — my retain- 
ership was ended, pei'iod. 

Mr. Weitz. Now, Dr. Mehren had just replaced, in January of 1972, 
Mr. Nelson. Is that correct ? 

Mr. VAN Dyk. That's right, that's correct. Mr. Nelson had been re- 
placed, Mr. Parr had been replaced, in fact, the turnover I foresaw, 
and it did happen. 

Mr. Weitz. Do you know the reasons for dismissal of or replace- 
ment of Mr. Nelson ? 

Mr. VAX Dyk. Well, I assume that the Nixon contributions played 
a part. I also understand — and I don't mean anything hard on tliis — 
that thei-e had also been internal problems regarding mergers with 
other co-ops in other parts of the country, and there had been internal 
tensions which played a part in this. I don't know how much of this 
is true or not. 

Mr. Weitz. Do you know of any solicitations by Republican fund- 
raiser or contributions to President Nixon's reelection eifort in 1972 
that were then taking place? 

Mr. VAN Dyk. I clid not know. I have since read the press of Mr. 
Kalmbaclrs solicitation of Dr. Mehren and the rest of it, but I had no 
knowledge at that time. 

Mr. Weitz. Did Dr. Mehren ever ask your advice or confer with you 
at all in connection with additional contributions in 1972, other than 
his request to meet with Mr. McGovern ? 

Mr. VAN Dyk. No, that was the sole discussion we had about that. 
I talked with Dr. Mehren subsequent to that letter I got from Bob 
Isham, which frankly angered me to i-eceive a form letter from a 
comptroller 3 days before the end of the month, and he. Dr. Mehren 
told me that in fact his hands were tied and that the officers of the 
cooperative had severed all of these relationships, and there was noth- 
ing he could do, but he was very cordial. 

Mr. Weitz. All right. 

Mr. Sanders? 

Mr. Sanders. All right. 

Do you recall in 1970 a Muskie political committee entitled Maine for 
Muskie ? 

Mr. VAN Dyk. I don't know if I recall that specific committee. I 
know that there was an AMPI contribution made to a Muskie com- 
mittee. That may have — that may well have been it. 

Mr. Sanders. "V^^iat I am seeking is to determine whether you knew 
whethei- that was a senatorial campaign committee or a Presidential 
campaign committee. 

Mr. VAN Dyk. No, I assume it was senatorial. Senator Muskie was 
a candidate for reelection at that point. 

Mr. Sanders. Just being a senatorial candidate from Maine might 
make it seem unlikely that the State name would be in the name of 
the committee. 

Mr. van Dyk. I don't know. 

Mr. Sanders. You don't have any recollection ? 

Mr. VAN Dyk. No. 

Mr. Sanders. Did you solicit from — are you acquainted with Stuart 
Russell? 



7012 

Mr. VAN Dyk. I am not. 

Mr. Sanders. Have yon over had any contact with him by corre- 
spondence, telephone or otherwise ? 

Mr. VAN Dyk. Not to my recollection, no. 
Mr. Sanders. Are yon acqnainted with Milton Semer ? 
Mr. VAN Dyk. Oh, yes. 

Mr. Sanders. In 1970, did yon talk with Semer concerning contri- 
bntions for Senator Mnskie ? 

Mr. VAN Dyk. I dont' know whether I talked to Milton Semer. I 
may have. I do recall having spoken to Donald Nicol, who was Senator 
Mnskie's administrative assistant, I believe, at that point, bnt I may 
have talked to Milt, too. I'm not snre. 
Mr. Sanders. Nicol was his A A ? 
Mr. VAN Dyk. Yes. 

Mr. Sanders. And what was the natnre of yonr discnssion ? 
Mr. van Dyk. Senator Mnskie, as many other Senators, was up for 
reelection and wanted campaign funds, and I think we discussed 
whether or not Senator Mnskie needed money. I think he was — I think 
Senator INIuskie had in fact told me that his total campaign expendi- 
ture of the previous campaign had been $18,000, and in fact inflation 
had multiplied that many times and that he needed campaign con- 
tributions. I spoke to Don Nicol, and we talked about AMPI con- 
tributions, and they, in fact, sent me some checks which I passed on 
to them. 

Mv. Sanders. Who is "they," when you say they sent you some 
checks ? 

Mr. VAN Dyk. Nelson, Parr. 

Mr. Sanders. Do you recall during what time this occurred ? 
Mr. VAN Dyk. Well, it would have been before the 1970 campaign. 
Mr. Sanders. Or about how many checks, or the total amount? 
Mr. VAN Dyk. I know there were at least two checks, and they had 
a white form on the front of it which was to have been sent back by 
the recipient. There may have been more, but I recall at least two, 
Avhich I just shipped over to the Muskie office, which was not on the 
Hill at that point, but was on L Street. 

Mv. Sanders. Well, now, in your discussion with Nelson and Parr 
concerning funds for Muskie, were you talking with them, or did you 
have in mind funds from TAPE ? 

Mr. VAN Dyk. Well, sure, whatever — when I say AMPI, to me AMPI 
and TAPE are interchangeable. I was retained by AMPI. sure, TAPE. 
Mr. Sanders. And the two checks von received, were thev from 
TAPE? 

Mr. VAN Dyk. I don't know. I recall one, specifically as being from 
the predecessor of what is Mid-Am. what is it, ADEPT, which used 
to be called something else prior to being called ADEPT, and there 
was a second check which may have been from TAPE or — I have been 
asked, quite obviously, by the Watergate people the same questions, 
and they asked me if a check was from Stuart Russell, and I told 
them as I told you, I don't recall it was. I don't have that recollection. 
It might have been. 

Mr. Sanders. Were von shown anv documents in conne^^tion with 
this? 

Mr. VAN Dyk. No, I was not. No. 



7013 

Mr. Sanders. I show you a document I am marking? exhibit No. 10, 
which purports to be a "letter from Bob Lilly to Ted van Dyk, dated 
July 28, 1970, with an attachment, two checks, copies of two checks 
from Russell to a IVIuskie election committee. 

["Wliereupon, the document referred to was marked Van Dyk exhibit 
No. 10 for identification.^] 

Mr. VAX Dyk. Yes. 

Mr. Saxders. Do you recall receiving that letter ? 

Mr. VAN Dyk. I'm sure I did, and I do recall receiving two checks. 

Oh, yes, there are two checks here, from Stuart H. Russell, the Lib- 
erty National Bank and Trust Co. of Oklahoma City. However, there 
must have been more than two or separate mailings to me because I 
also recall a check from — possibly as many as two or more checks, be- 
cause I also remember a check, as I indicated, from the predecessor of 
ADEPT, the Mid- Am political committee. I have no reason to doubt 
that these were the checks. 

Mr. Saxders. Did you wonder why AMPI was sending you checks 
from an individual rather than their political action arm? 

Mr. VAX Dyk. No; I don't really recall, quite frankly, up until this 
time, the Russell checks. I assumed, if I assumed anything, that they 
had found some individual that would make a contribution. 

:Mr. Saxders. There is, of coui'se, in this letter the reference that 
these two checks, along with checks from two other co-ops, makes the 
total slightly in excess of $10,000. 

Mr. VAX Dyk. Yes. Well, that reference to checks from other co-ops 
must be the Mid-Am check we are talking about. 

Mr. Saxders. Now you had then no conversation with Parr, Nelson, 
or Lilly concerning moneys they would collect from Stuart Russell. 

ISIr. VAX Dyk. No. I had never heard — I have never met Stuart 
Russell. I had never heard of him until I saw the recent press reports. 

Mr. Saxders. I will show you Lilly exhibit No. 18.- It pur])orts to 
be a memo from you to BobLilly dated September 14, 1970. Do you 
recall preparing and sending that memo to Lilly ? 

Mr. VAX Dyk. Yes; I'm sure, yes, I'm sure. 

Mr. Saxders. Can you explain what that is all about? 

Mr. VAX Dyk. Yes'. There must have been something wrong with one 
of the checks, or didn't comply with regulations or something, and 
the Muskie people asked me to get it changed. I don't recall the 
specific 

Mr. Saxders. Do you know who Whitmore is? 

Mr. VAX Dyk. I don't know ; no. 

Mr. Saxders. Why would Muskie people have been using you as an 
intermediary ? 

l\Ir. VAX Dyk. Wait a minute, wait a minute, wait a minute. 

Whitmore, I think— Senator Muskie— the AMPI people asked, I 
believe. Senator Muskie to send them a list of candidates in New Eng- 
land and other places Avhom he recommended for contribution, and as 
I recall, there was a Whitmore who was one of the people he recorri- 
mended to receive a contribution. I think Bob must have sent this 
check to me. I think I sent it to the Muskie people, and it was too late 
or they changed their mind or something, and instead they apparently 



1 See p. 7055. 

= See Book 14, p. 6025. 



7014 

asked for a $1,000 check to Maine for Miiskie instead, and I'm— and 
that's what happened, I'm sure. 

Mr. Sanders. You think l^^iitmoi-e would have been some New 
Enfjland candidate? 

Mr. VAN Dtk. Yes. 

Mr. Sanders. That they initially 

IVIr. van Dyk. Had recommended for a contribution. I remember 
there was quite a long list they had turned in. 

Mr. Sanders. Muskie's office had recommended for a local contri- 
bution ? 

Mr. van Dyk. That's right. 

Mr. Sanders. And that the check was submitted and was sent back. 

Mr. VAN Dyk. And I think they — either they sent it back or they 
called me up and told me to forget it, that they wanted the money 
instead for Muskie, and that is the note. 

Mr. DoRSEN. Excuse me. I would like to say something for the record 
now. I thought that we would be — the documents would tend to indi- 
cate the jurisdiction of this committee. It appears now that the docu- 
ments, quite the opposite, are showing that this is completely uni-elated 
to the jurisdiction, and that we are now dealing with local candidates. 
I don't want to stop this line of questioning. I 

Mr. Sanders. Well, until Mr. Whitmore is identified, one doesn't 
know w^hether he's the one that signed the check payable to Muskie 
or whether he's — until we get the answer- there's no way to know 
whether it was or wasn't. 

Mr. DoRSEN. Right, that is true. I didn't know whether you were 
still 

Mr. Sanders. I think you're taking a very narrow — I really object 
to such a narrow interpretation of the questions, and I'm ffoing to get 
in a minute to a check that was written after the November election, 
and I really do take offense at the very restrictive view you are taking. 
I think it is harassment, and I take offense at it. 

Mr. DoRSEx. Well, I think that's an extreme characterization of my 
observation, Mr. Sanders. 

Mr. Sanders. There's no reason why we can't have a little more lati- 
tude in these. We are not in public session. I think we have been very, 
very generous in not making objections to inquiries of majority staff 
which have related to many, manv things which are extremely tangen- 
tial and remote from the 1972 Presidential campaign, not only on 
the milk investigation but in the Howard Hughes contribution. 

If you want to argue about it, I would be glad to continue. 

Mr. Warnke. May the record show I have taken no position with 
respect to this colloquy. 

Mr. DoRSEN. I think that is clear, and I think it is incumbent upon 
us to act within the scope of our resolution, so I would hope that 
everybody would toe the line to the appropriate extent. 

Mr. Sanders. Do you recall receiving, then, the new check to Maine 
for Muskie? 

Mr. VAN Dyk. I either received it or it was sent directly to — I believe 
my note says to send it directly to the Muskie man there. 

Mr. Sanders. Was it in fact signed by Harold Nelson? 

Mr. VAN Dyk. Nelson was the fellow who Mor-ked for Muskie, vou 



7015 

Mr. Sanders. Oh, excuse me. 

Mr. VAN Dyk. Nelson Avas JMuskie's man. It must have been Nelson 
who called me and told me to forget the Whitmore check and send 
money instead to Muskie. 

Mr. Sanders. Was this a TAPE check that was 

Mr. VAN Dyk. I assume, sure. I don't knoAv, but my instruction to 
Lilly there, you recall, is that he send the check directly to Nelson, who 
was Muskie's campaign officer. 

Mr. Sanders. Are you aware of the receipt of any checks through the 
auspices of AMPI to Muskie which Avere received after the November 
election in 1970? 

INlr. VAN Dyk. Not specifically. There may have been. If the record 
shows that there were, it is quite possible. I don't have any specific 
I'ecollection of such, no. 

ISIr. Sanders. Well, the documents that I have been furnished by 
]\Ir. Weitz do not include a copy of the check after the November elec- 
tion, which was apparentlv sent to the Muskie election committee by 
Stuart Russell at the request of Bob Lilly for $.5,000. 

I'm going to mark this as exhibit No. 11, and show you this docu- 
ment which purports to be a letter from Stuart Russell, dated Novem- 
ber 24, 1970, which is after the November election by my calendar. 

[Wliereupon, the document referred to was marked Van Dyk 
exhibit No. 11, for identification.*] 

Mr. VAN Dyk. I have no knowledge of that. I mean, this is my first. 

Mr. Sanders. You have never seen this letter ? 

Mr. VAN Dyk. No. 

Mr. Sanders. And the contents of it do not stir any recollection on 
your part- of the receipt of any such check ? 

Mr. VAN Dyk. Not by me. 

]Mr. Sanders. Or that you requested Lilly to obtain fmids of that 
amount ? 

]Mr. VAN Dyk. No. By and large I was told the contributions that 
were made were made directly to the candidates' committees from 
San Antonio. In a few instances, I think as much inadvertence or 
anything else, checks were sent to me which I would then pass directly 
to the election committee. So I mentioned the checks I sent to Muskie. 
I believe there was a check I sent to Joe Duffy. Tliere was a check 
I sent to George Rawlings, perhaps one or two others. Normally the 
checks would not have been sent to me. I mean, it just happened they 
came to me and they always came with a form on the top of them, and 
I would forward them to the candidate or his campaign committee 
in most cases. The procedure was I would make i-ecommendations, 
as I would assume others were making recommendations, and then 
any contributions were made directly to the campaign committee. 

So in the normal course of things I would have no knowledge of this 
at all. 

Mr. Sanders. Do you have any recollection, other than the two 
Stuart Russell checks which have already been shown, of at any 
other time receiving from AMPI or any of its officials checks drawn 
by any individuals as opposed to TAPE ? 

' IVlr'. VAN Dyk. It is possible. My reaction would have been that if 
there were checks drawn on individuals, they were individuals whom 

*See p. 7057. 



7016 

AMPI had solicited and who had airrced to make contributions as 
individuals. 

I have been in politics a lon_o- time and T would have assumed that 
that was what mio-ht have happencnl. 

]Mr. Sanders. Did you have any involvement in the arrangement for 
any thank you letters from Senator Muskie to A]MPT for the contribu- 
tions that they had sent to the JMuskie campaigri ? 

INIr. VAX Dyk. I may have. I don't recall. If you woidd share the 
letters with me, I could tell whether it was somethinij I drafted or not. 
Mr. Saxders. I'm G:oino; to. The ones T was turnino^ over here are not 
related to what T was si^eakinof of. 

INTr. VAX Dyk. OK. I usually can reco<rnize somethini>- 1 misfht have 
drafted. 

Mr. Saxders. I'm going to mark hei-e as exhibit Xo. 12 a letter from 
Senator Muskie to Harold Xelson, undated but stamped "Keceived 
August 27, 1970," and anothej- document — a letter from Senator Muskie 
to Stuart Russell, dated December 22, 1970.^ 

[Whereupon, the document referred to was marked Van Dyk exhibit 
No. 12 for identification.-] 

]Mr. AYarxke. Could I ask iVfr. Sanders what was exhibit No. 11 ? 
Mr. Saxders. It is this letter from Russell to the Muskie election 
committee. 

Mr. Warxke. Yes. I would like the record to make it clear that that 
was not identified by ^Nlr. van Dyk. 

Mr. Saxders. I believe the record so shows. 

]Mr. Warxke. So that I question whethei" it is properly an exhibit 
to his testimony. 

Mr. VAX Dyk. I would also mention that neither exhibit 12 nor the 
other ]Muslde letter is familiar to me, and I would assume by the word- 
ing on exhibit 12 that Milt Semer was in fact the man who drafted the 
letter, since it says Milton Semer has given me a summary of your 
generous contributions. ]\Iilton Semer was in fact Senator Muskie's 
finance chairman, I believe, as well as being on retainer to AMPI. 

Mr. Saxders. I will now show vou Lillv exhibit 19 ^ which is a letter 
from you to Don Nicol dated July 9. 1970. 1 am going to show you this 
for your examination, and I want to ask you particularly about the 
special milk program mentioned. 

Mr. VAX Dyk. Yes. This is a letter that w^as sent to M7\ Nicol follow- 
ing a meeting Mr. Nelson, INIr. Parr, and a number of members of other 
co-ops had had with Senator Muskie in his office which I had arranged. 
They were the campaiini checks to which we referred. The special milk 
program would have been a — that was a piece of legislation, a special 
milk program was something under consideration in the Congress and 
Senator INIuskie. I believe, his support for the program was solicited, 
and he said he already supported it. 

The No. 8 point is the list of candidates to which I referred where 
Nelson. Parr, and their colleagues asked Senator INfuskie to submit 
a list of candidates to whom contributions might be made, and. that is, 
"Wliitmore was. as I recall, one of the people on that list. 

Point No. 4. the Senator said he wanted substantive input from sev- 
eral academics involved with agricultural policy and in fact we saw 

1 Spe SeniPr exhibit No. 5, p. 7227. 

2 Spe p. 7058. 

3 See Book 14, p. 6026. 



7017 

that several such documents were forwarded, and the other was a 
request that Dave Parr's son spend 

Mr. Saxdj^rs. I don't think you need to tell me. 

ISIr. VAN Dyk. All rioht. 

Mr, Sanders. I am not clear from your response — I'm still not clear 
what is meant by — what milk program is being referred to? 

Mr. VAN Dyk. There was a special milk proo-ram. It would have been 
either the school lunch proo;ram or the special supplementary milk 
program. In other words, it comes up for legislative action each year. 

Mr. Sanders. Annually? 

Mr. van Dyk. Yes. And this was a solicitation of his support for 
the special milk program, and as I remember his saying, "You don't 
need to ask me for my support because you have got it already." 

Mr. Sanders. And did his statement of his support for this program 
have some relationship to the contril)utions mentioned in paragraph 1 ? 

INIr. VAN Dyk. No, not to my knowledge. 

Mr. Sanders. Now, during the conference were political contribu- 
tions mentioned ? 

jNIr. VAN Dyk. I think. I do believe — in fact, as the meeting ended, 
Mr. Parr said to Senator Muskie, "Senator we want to be of help to 
your campaign." I think Senator Muskie said. "That is fine, I am happy 
to hear that," something of that nature. 

iNIr. Sanders. Are you saying that no specific sums were mentioned? 

Mr. VAN Dyk. No, I believe the sums were my fault there, on point 1 
where I wrote a note to John — Don Nicol saying please see that 
checks — I think the two sums, the sums I think were arrived at in 
independent consultation with the milk people. 

I think the sums were their sums, or I might have talked to Don 
about the sums. There was no discussion with Senator Muskie about 
the sums, I am sure of that. 

Mr. Sanders. Do you know how this figure of $1,666, was reached? 

Mr. VAN Dyk. I don't know, except you will notice in the bottom 
of the paragraph, T say to reach a total of $5,000 for each committee, 
so apparently $1,666 is — that is supposed to add up to $5,000. 

Mr. Sanders. Well, then out of the hearing, at least if it was not 
discussed in the hearing of Senator Muskie, out of his presence you 
talked with Nelson and Parr about this level of contribution ? 

Mr. VAN Dyk. I believe so, yes ; I think it was either subsequent to 
this meeting or it was on the phone previous at some point. During 
that summer there was discussion about help for Senator Muskie. As I 
recall at the end of that meeting Mr. Parr said to Senator Muskie, 
"Senator we are going to be of help to your campaign," and he said 
something to the effect "Well that's fine, that's good news,'' et cetera, 
and that was the extent of it. 

Mr. Sanders. Were you the one who arranged the appointment 
with Senatoi- Muskie? 

]Mr. VAN Dyk. Yes ; I was. 

Mr. Sanders. Through Nicol ? 

Mr. VAN Dyk. Yes; I believe so, or his appointment secretary, one 
of the two. 

Mr. Sanders. And were you the one who made the arrangements 
for Senator ]Muskie to speak at the AMPI convention in September, 
2 months later? 



7018 



Mr. VAX Dyk. I invited — let me see which, is this the • 

Mr. Sanders. The 1970 campaign. 

Mr. VAN Dyk. I arranged for all of the speakers. 

There was — I talked to Paul before about this, I arranged for all 
of the Democratic speakers at the convention in 1970. Senator Muskie, 
at the last moment, had a conflict and said he could not come and that 
he was tied up in Maine and it was impossible to get travel connec- 
tions, there was just no way he could make it. And I received a call 
from the AMPI people saying, "Isn't there something we can do to 
change his plans T' 

I said : "Look, the man has a pi'oblem. He will come to another con- 
vention. You have a good relationship with him, don't press him on it." 
And they said : "Isn't there something you can do to get him to come ?" 
and I said : "I've done all I can without making a pest of myself. If he 
can't come, if he has a conflict and transportation is impossible, then 
fine." 

I attended the convention and much to my surprise. Senator Muskie 
arrived and apparently they used some other channel, or some other 
means, to secure Senator Muskie's attendance, 

I don't know whether they had flown a private plane to pick him 
up, whatever, but he came in any case. I had made the original invi- 
tation to him. but I was quite surprised to see that he did attend. 

Mr. Sanders. This late-hour call that you had received to try to 
secure Senator Muskie's presence there, had the convention already 
begun at the time ? 

Mr. VAN Dyk. If it had not begun, it was on the eve of the beginning. 

Mr. Sanders. And after talking — who called you ? 

Mr. van Dyk. Oh, I'm sure it was Don Nicol. or somebody else on 
the Senator's staff to say that he could not, that there was a conflict 
and it wasn't going to work. 

Mr. Sanders. No ; who called you from AMPI ? 

Mr. VAN Dyk. Oh, it would have been ]Mr. Nelson or Mr. Parr. 

Mr. Sanders. And then you called Nicol ? 

Mr. VAN Dyk. Eight. In other words. Senator INIuskie, as I recall, 
was already tentatively on the program. The conflict arose. I then 
called Nicol to say, "Look they are quite urgent, it is highly impor- 
tant to them, and they asked if there isn't some way that it can be 
worked out logistically," et cetera. 

It could not and I left it at that and so reported to Nelson and Parr. 

Mr. Sanders. Were you told by Nelson or Parr that they needed 
Senator Muskie because President Nixon was not going to appear ? 

Mr. VAN Dyk. No; it might have been, I don't recall. It was not 
an important factor in my mind. 

Mr. Sanders. In the communication you received from Nelson or 
Parr on the eve of the convention, were you told of what sum or 
honorarium would be paid to IVIuskie ? 

]\fr. VAN Dyk. Whatever it was, it had been arranged, and Parr may 
very well have said we will increase the honorarium, and I know what 
my reaction would have been, which is to sav that doesn't make any 
difference, if a man has a conflict, he has a conflict. 

Mr. Sanders. Do you know what Senator INIuskie was paid for his 
appearance ? 



7019 

Mr. VAN Dyk. I don't recall, but I'm sure it was declared in his 
annual listing of same, which goes into — goes to the Clerk of the House, 
doesn't it ? It is in the Congressional Eecord over here. 

Mr. Sanders. How much of an increase w^as olfered by Parr? 

Mr. VAN Dyk. I don't recall, I don't recall. 

Mr. Sanders. Did you convey that to Nicol ? 

Mr. VAN Dyk. No ;"I didn't. "^ 

Mv. Sanders. Were any of the contributions that were discussed 
by you with Nelson and Parr in July, in a meeting around the time 
you met with Senator jMuskie, was Senator Muskie's appearance at 
the convention mentioned at that time in connection with those 
contributions? 

Mr. VAN Dyk. No; not at all. Thei'e was a long list of people who 
were up for election and reelection in 1979, and I made a number of 
recommendations which were largely for a nmnber of liberal Demo- 
crats plus Democrats in their home States. I don't recall any direct 
relationship between the convention and the political contributions. 
All the speakers were paid honoraria, whatever their standard fee 
might be, to come to the convention. 

Mr. Weitz. I just want to enter for the record the fact tliat I have 
looked through iny records and cannot find a copy of the check from 
Stuart Russell to "the Muskie campaign, a $5,000 check, but we will 
attempt to locate it. 

Mr. Sanders. Do you think you had it at one time and just could 
not locate it ? 

Mr. Weitz. I don't think so. I have never seen it. Well, I can't say 
I've never seen it. I just don't remembei-. 

Mr. Warnke. Might I ask with respect to Lilly exhibit 19, might 
I take a look at it ? 

Mr. Sanders. Sure. 

Mr. VAN Dyk. I must say the Muskie committee certainly kept vo- 
luminous files if they kept this type of material. 

Mr. Sanders. Do you have — — 

Mr. VAN Dyk. I think it should be noted again that some of these 
exhibits, at least three, I had no previous exposure to or knowledge of. 

Mr. Warnke. I think the record shows that you did not previously 
see either exhibit ] 1 or exhibit 12. 

Mr. van Dyk. Right. 

Mr. Warnke. And as a consequence, none of them have been identi- 
fied by you. 

Mr. VAN Dyk. Right. 

Mr. Sanders. Do vou have within vour office a file on vour work for 
AMPI? 

Mr. VAN Dyk. A file? 

Mr. Sanders. Yes. 

Mr. VAN Dyk. I don't have anything that is current with any client. 
I have a current file with Dairyman, Inc. I don't ha^^ anything — 
I have nothing current with AMPI, obviously, except the corre- 
spondence I received from George Mehren, which I passed to this 
committee regarding all of the financial end of the records for sub- 
mission here. Anything I prepared for them, however, ought to be in 
their files, if they keep long backfiles. 



7020 

Mr. Sanders. While yon were consnltinir for AMPT, yon undoubt- 
edly kept a file on their activities. 

Mr. VAN Dyk. Sure, sure, some, and some of the thinijs I kept and 
some of the things I made only copies. I'll be quite frank with what 
they were. They were analyses I made particularly of Democratic 
and other politics in which I was quite candid about developments 
within the party, prospects for vai'ious candidates, et cetera, many of 
whom were all friends of mine. I marked these particularly confiden- 
tial and sent them to Parr and Nelson, requestino- that they be kept 
that way. It is not the kind of thine; you like to have floating around. 
So at that time I kept no copies of these. 

For other things I did have copies. 

Mr. Sanders. Well, at the time your retainer was discontinued with 
AMPI, what did you do with your file or files on vour work for 
AMPI? 

Mr. VAN Dyk. Nothing at that time. When I moved my offices in 
March of 1972, I threw just about everything out that was more than 
a few months old, that was not current, for all of my clients, which 
included AMPI. 

Mr. Sanders. Do you still, today, occupy the same offices, the same 
space that you occupied then ? 

Mr. VAN Dyk. No, no; we moved twice. I moved in March of 1972 to 
1720 I Street NAV., and we moved last week to 11.56 loth St., NW. The 
first time my lease expired. The second, a client of mine wanted us to 
have adjacent offices, and we had also ran out of space, so we accom- 
modated him and moved. 

Mr. Sanders. While you were representing AMPI, do you Imow 
how your files foi- that work were labeled ? 

Mr. VAN Dyk. Oh, AMPI, I'm sure, maybe. They were originally 
called Milk Producers. I think tliei-e was a i)redecessor group, IVIilk 
Producers. Inc. AjNIPI, that would have been it. 

Mr. Sanders. Would you have had any separate file for correspond- 
ence with Parr and Nelson ? 

Mr. VAN Dyk. I don't think so. I thing it probably all would have 
been thrown into the AMPI or Milk. I miglit have. I don't recall 
specifically. 

Mr. Sanders. Do you, today, have any file anywhere within your 
office containing material from your representation of AMPI? 

Mr. VAN Dyk. I don't know. I can look. We found some of the things 
you asked for. Sure, those were in my file. 

Mr. Sanders. Alan, have you asked for production of this material 
that I have just been inquiring about ? 

Mr. Weitz. It would be covered within the subpena, yes, I believe. 
I'm sorry, the last question was 

Mr. VAN Dyk. Well, we've given you everv'thing you have asked for. 

Mr. Sanders. Well, I would assume that Alan has asked for in- 
voices and copies of checks. 

Mr. VAN Dyk. And you asked for anything, whatever, having to do 
with 1972 Presidential campaign activities or anything touching on 
these things which we — I mean, we've given you 

Mr. Weitz. And it includes, I believe, billings and payments back 
and forth between you and any of the dairy co-ops. 

Mr. VAN Dyk. That's right. 



7021 

Mr. Sanders. Well, in your representation of AMPI after 1970 — 
you were, I believe, discontinued in January of 1972? 

Mr. VAN Dyk. That is correct. 

Mr. Sanders. For a period of 13, 14 months there, any representa- 
tion of AMPI would have had considerable relationship to the up- 
coming 1972 Presidential campaign, would it not? 

Mr, VAN Dyk. No. I mean, my relationship with AMPI was the 
same that it had been. I mean, it was the same during that period as 
previous until it ended in, well, February of 1972 I think it Avas. 

Mr. Sanders. Well, I am going to ask for production of anything 
you have in your office in a file pertaining to AMPI dated after 
November 1970. 

Mr. VAN Dyk. Could I ask, could counsel ask what is it you are look- 
ing for? I mean, I don't 

Air. Sanders. Any correspondence, any memorandums, any notes, 
any documents whatsoever pertaining to your representation on behalf 
of AMPI from November 1970, until January — actually until Febru- 
ary 1972. 

Mr. Warnke. I will object to that request to the extent it goes be- 
yond the subpena of the committee already issued. The subpena al- 
ready issued by tlie committee relates directly to matei'ials that had to 
do with the Presidential campaign. Those materials have been pro- 
duced. If there are other materials that don't relate to the Presidential 
campaign, they are beyond the scope of this committee's activities and 
they will not be produced. 

Mr. Sanders. Are you saying, Mr. Warnke, that these files pertain- 
ing to AMPI that I iiave just inquired about have been completely ex- 
amined and that to the best of your judgment there are no copies, no 
letters or copies of letters, of memorandums or copies of memorandums 
or any other documents that have any relationship to the 1972 Presi- 
dential campaign ? 

Mr. Warnke. ^^Hiat I am saying, sir, is that we have examined the 
subpena and the subpena has been complied with. The subpena, as far 
as I'm concerned, exhausts the authority of the committee. 

IVfr. VAN Dyk. Let me indicate also, I want to be as lielpful as pos- 
sible. We have been asked here today, as in the jDast, about contribu- 
tions, contacts, about involvement in and with the campaigns of most 
Democratic candidates you haA'e asked. I would be happy to give ex- 
actly the same answer to that of any other candidates that you want 
to name in the Presidential nomination, Eepublican, Democrat, 
orange, yellow, green. I mean, that is it. 

Mr. Sanders. Do you have within your office, Mr. van Dyk, any 
files pertaining to — containing correspondence with Senator Muskie? 

Mr. VAN Dyk. I may, I luay. 

Mr. Sanders. How would communications with him be filed within 
your office ? 

Mr. VAN Dyk. Probably under Muskie. 

Mr. Sanders. Would you have had occasion to correspond with him 
concerning the 1972 Presidential campaign? 

]\rr. VAN Dyk. I doubt it. I can't recall having done so. 

Mr. Sanders. Would you have had occasion to prepare memoran- 
dums, coi:)ies of which might liave been placed within your files con- 
cerning the Muskie 1972 Presidential campaign ? 



7022 

Mr. VAN Dyk. I think not. I did, I did as I indicated to yoii, pre- 
pare periodic memorandums on various Democrats and campaign pros- 
pects and so on, wliich were made in one co]iy which I sent to Nelson 
and Parr. There was no memorandum or exchange involving Muskie 
that I can recall at all. 

Mr. Sanders. Copies of any correspondence which you have had 
with AMPI which pertain to Muskie I presume would have been 
placed also in the Muskie file. 

Mr. VAN Dyk. I assume, but I don't know. I can look at the Muskie 
file. I have gone completely through my files searching for every- 
thing to comply with this subpena. If I have anything in a Muskie 
file, there would at most be one or two letters to or from Senator Muskie 
nothing involving the lOT'g Presidential campaign to my knowledge. 

Mr. Sanders. "Well, I would like to request you to again examine 
files, the Muskie file, and produce anything which you and counsel 
feel might yet be within the scope of this subpena. 

Mr. Warnke. We'd be delighted to do so. 

Mr. Sanders. Tliere came a time when your retainer with AMPI 
was increased from $25,000 per year to $60,000 per year. 

Mr. VAN Dyk. That was in stages, yes. 

Mr. Sanders. It was not at a single instance ? 

Mr. VAN Dyk. No, I don't believe so. 

Mr. Sanders. Do you know in how many increments? 

Mr. VAN Dyk. Yes. I mean the invoices will show that. There was 
a time when I asked them for an increase and early in 1971, April of 
11^71, I had — sometime early in 1971 I had talked to Mr. Nelson and 
Mr. Parr about an increase in retainer. They said at that point, "It 
will be difficult for us to increase your retainer, per se, but why don't 
you allocate some of your overhead direct expense to AMPI and bill 
us for that." I did that through the months of April, May, and June 
1971. I was told in July 1971, I could go to a flat — I had been given a 
fiat $5,000 a month retainer, which continued until 

Mr. Sanders. As of April 1971, you were still at $25,000 per year? 

Mr. VAN Dyk. April, yes, through March 1971, I was paid on the 
basis of $25,000 per annum. 

Mr. Sanders. And as of July 1971 you were at a level of $60,000 
per year. 

Mr. VAN Dyk, That's correct, yes. 

Mr. Sanders. Wliat was it that you told Mr. Nelson to justify an 
increase ? 

Mr. VAN Dyk. Well, I thoug:ht I had been valuable to them. I 
thought my advice was worthwhile. I thought I deserved an increase, 
given what I knew other consultants and people with similar skill 
were being paid in Washington. I also told them quite frankly that a 
major client of mine which was paying me a retainer of some $36,000 
per annum, was in fact going into bankruptcy and I was going to 
face some financial pressures as a result. And all of these things taken 
together, I asked if I could have an increase, and again they gave me 
the temporary interim increase for 3 months, and then the firm in- 
crease July 1971. 

Mr, Sanders. Did you cite to him any specific examples of the bene- 
fit of your services ? 



7023 

Mr, VAN- Dyk. No, only this, that I had every reason to believe 
I had confidence in my judgment and placed store by it, except they 
certainly didn't follow my advice or reaction on the Nixon contribu- 
tions. But I, perhaps Ijeing immodest, I saw a large number of con- 
sultants they had. I tliought my skills were of an order higher than 
most, and I had every reason to believe that Mr. Nelson and Parr had 
full confidence in me and felt my judgments and advice were im- 
portant. And I thought therefore that I deserved an increase. 

Mr. Sanders. Was there any mention made of the moneys paid to 
Lilly? 

Mr. VAN Dyk. No. 

Mr. Sanders. Did you mention to him, in talking about an increase, 
any particular thing that you would do in the future for them ? 

ikr. VAN Dyk. I don't think so, except to continue to advise. 

Mr. Sanders. AVas there any understanding between you that any 
of the moneys paid to you would be channeled through to any other 
persons ? 

Mr. VAN Dyk. I assume you were talking about the — no. 

Mr. Sanders. I'm talking about just the moneys paid to you as a 
retainer. 

Mr. VAN Dyk. No, no. It would be paid to me for my company. 

Mr. Sanders. I had in mind channeled to other persons for political 
purposes. 

Mr. VAN Dyk. I know it. I thought, quite frankly, I assumed you 
meant Senator McGovern, who by then I was an informal adviser to, 
and the answer to that is no. 

Mr. Sanders. Do you have any correspondence with AMPI con- 
cerning the arrangements for Senator McGovern to speak at the con- 
vention ? I'm sorry. Senator Muskie. 

Mr. VAN Dyk. I don't think so. Essentially what happened, as I 
recall — in fact, I think I arranged their speakers for 3 years. We would 
counsel informally about who might be appropriate, people from 
their States, people who would be attractive to the audience, and so 
on, and I would simply call them up and get them. I don't recall any 
correspondence in particular, except I am sure I sent factsheets, 
information, et cetera, re the meetings to everybody about who was 
going to speak. If there was Muskie correspondence, I will look for it 
in my files. 

Mr. Sanders. All right. After the time of the November 19Y0 elec- 
tion, did you have occasion to issue any personal or company checks 
to Senator Muskie or to any campaign adjunct of his? 

Mr. van Dyk. No. 

Mr. Sanders. Do you still have a copy of the report prepared by 
Ken Olson? 

Mr. VAN Dyk. No. They were singrle, typewritten copies. It was not a 
report, it was a series of reports about going with the State political 
developments. They would come periodically. They were typewritten 
by him obviously.' They weren't even — you could see mistakes and 
everything else, and I simply sent them direct on to AMPI. 

Mr. Sanders. Do you have any correspondence to or from Kenneth 
Olson concerning this project? 

Mr. van Dyk. I don't think so, but again we can look on that, too. 
Let me look. I don't recall so. 



7024 

Mr. Sanders. Do you have any corrcsi)onclence to or from the Sen- 
ate Democratic Campaign Committee concerning the request to you 
to institute this ? 

Mr. VAN Dyk. No. This was a simple telephone request. 

Mr. Sanders. Do you know wher-e Olson is at the present time? 

Mr. VAN Dyk. I believe he is making a movie in Greece. It's a 
good life. 

Mr. Sanders. Do you know where his home is located ? 

Mr. VAN Dyk. Oh, I don't know. He's a single guy, divorced, and 
has lived in New York, San Fi-ancisco. et cetera. He's a writer, a free- 
lance writer, and the last I heard he was in Greece making a film. 

Mr. Sanders. Do you haAe any office file correspondence pertaining 
to your contact with AMPI ancl your contacts with the polling firm 
in connection with the West Virginia or Wisconsin poll ? 

Mr. VAX Dnv. That was very simple. No. I did the whole thing. 
Once the thing was agreed on,' I talked to the Gallup people. They 
did the poll. You have the poll. 

Mr. Sanders. Yes. 

Mr. van Dyk. And I think it's a very straightforward thing. T told 
them exactly what we wanted, which was an indepth poll covering 
not only so-called beauty contest, but attitudinal outlook of voters 
and how they would proceed, vis-a-vis certain issues. 

Mr. Sanders. And your request, then was not in writing? 

Mr. VAX Dyk. No. Look, the Gallup people are professionals and 
so am I. It must have taken me all of 15 minutes to tell them what I 
wanted. They had done it 100 times and so had I. 

Mr. Sanders. Did Senator Muskie oi- any person working for him 
receive any advice concerning the results of the poll ? 

Mr. VAN Dyk. Not to my recollection, not from me. 

Mr. Sanders. How many copies of the full poll report did you 
receive ? 

Mr. VAX Dyk. As I recall, five or six, all of which except one. I gave 
to the AMPI people, the one you have. 

Mr. Sanders. The only thing that you gave to McGovern and Ken- 
nedy were the summaries ? 

Mr. VAN Dyk. Yes, summaries. Also a copy of which yon have. 

Mr. Sanders. Well, do you have any correspondence pertaining to 
the poll conducted in Arkansas? 

Mr. van Dyk. No. That, too, w\as a simple, straightforward kind of 
thing. It was the type of poll that Kraft did all the time, and it was 
just a matter of the same kind of poll, candidates, how the votere 
perceive them on a statewide basis. 

Mr. Sanders. Was it Parr that asked you to conduct this poll ? 

Mr. VAN Dyk. The Arkansas poll ? 

Mr. Sanders. Yes. 

Mr. VAN Dyk. Yes, it was. 

Mr. Sanders. Did he talk with you in person or by telephone? 

Mr. VAN Dyk. I don't recall. 

Mr. Sanders. Do you have any correspondence with AMPI or with 
Parr concerning this poll ? 

Mr. VAN Dyk. I don't Imow that I do now. Again, it was a state- 
wide — AMPI Avas very active in Arkansas. Parr himself lived in 
Arkansas, as you know, in Little Rock. Thev have been verv active 



7025 

in State politics and they wanted to know, I guess, what the prospects 
were, and tliey gave me a list of candidates. 

Mr. Sanders. Do you still have in your office any copy of the results 
from Kraft? 

Mr. VAN Dyk. I don't. That was given to Mr. Parr. 

Mr. Sanders. Can you give me, to the best of your recollection. 
Parr's conversation with you, when he spoke of his desire to have 
this poll? 

Mr. van Dyk. Yes. I think it was this, particularly there were a 
number of candidates down there who were, as I recall, statewide pos- 
sibilities, Dale Bumpers, McClellan, Fulbright, the congressional dele- 
gation. He wanted to find out just how the Arkansas candidates stood 
vis-a-vis each other, and how the State lined up, and we got the names 
and we took them to Kraft and he devised the poll and went ahead 
with it. 

Mr. Sanders. This was in advance of the November 1970 election. 
Is that true? 

Mr. VAN Dyi£. Wliat was the date of that? [Pause.] No, that would 
have been for 1972, right? 

Mr. Sanders. You have a date for a billing or payment there? 

Mr. VAN Dyk. What was it, 1971, the end of 1970 and into 1971, so 
it would have been for the prospects for 1972. 

Mr. Sanders. Did Parr tell you in talking with you, about his desire 
for this poll, of any feeling that Mills would be a Presidential 
candidate ? 

Mr. VAN Dyk. No, I tell you, the impression I had was that they 
had specific interest in two races, particularly, the gubernatorial race 
in that they had been friends of Dale Bumpers and they wanted to 
measure his strength, and in the senatorial race, which was — which 
would be a choice in 1972 between Senator McClellan and any one of 
several others in the primary. 

And that was really where their interest lay. As I think I indicated 
when we had our last interview, the last thing that would have been 
helpful to Wilbur Mills would have been a poll in the State of Arkan- 
sas. I don't even recall that Mills was in the poll, but I know that there 
were particular areas just for the governorship and senatorial races. 

Mr. Sanders. I had some recollection that during the last interview, 
you did say that you thought there was some coverage of Mills. 

Mr. van'Dyk. He may have been in it, but it was certainly not some- 
thing I had a feeling was undertaken at Mills' behest or benefit, or to 
help him. That was remote. 

Mr. Sanders. Are you personally acquainted with Charles Mickel? 

Mr. VAN Dyk. Only by telephone. 

[Discussion off the record.] 

Mr. Sanders. Do you have any office file or any correspondence con- 
cerning the project he conducted in South Dakota ? 

Mr. VAN Dyk. Only that which you have, which is his invoice. The 
rest, again, was telephone. It was Jim Abourezk's request, my tele- 
phone conversation with Nelson and Parr, my discussion with, in 
turn, Mickel, et cetera, his sending of the study and the bill. 

Mr. Sanders. I want to direct your attention to the meeting you told 
us you haa with Dave Parr in Little Rock. 

Mr VAN Dyk. Yes. 



30-337 O - 74 



7026 

Mr. Sanders. You said that it was perhaps a month or within a 
month after the September 1970 convention. 

Mr. VAN Dyk. 1971. When was it they made the milk — the Nixon 
contributions ? 

Mr. Sanders. All right. That would have been 1971. 

Mr. VAN Dyk. 1971, and then Nixon was there at the convention in 
1971. Yes, that's right. 

Mr. Sanders. Would you please explain the circumstances of your 
going to see him, how the arrangements came about ? 

Mr. VAN Dyk. My going to see him on that occasion ? 

Mr. Sanders. Yes. 

Mr. VAN Dyk. Sure. First I had, as I indicated, been highly upset 
when I saw the reports of the massive contributions to the various 
campaign cx)mmittees, and I had called Mr. Nelson and Mr. Parr and 
told them I thought it was a serious mistake and that it reflected 
badly on the organization and on them. I frankly thought they dis- 
counted my concerns because they thought I was a partisan Democrat 
who was simply objecting on a partisan basis, and I mentioned this 
several times to them, and then, upon my attendance at their convention 
in Chicago, where Mr. Nixon was present, as I told you, I was startled 
to see, rather than the AMPI officers and the board of directors and 
so on take the stage with Mr. Nixon for his appearance. Nelson and 
Parr accompanying him to the platform in front of the many thousands 
of members and so on. I thought it was a serious mistake in judgment, 
and I thought they were riding too high and they were going to be 
just plain thrown out of their jobs. And with all of these thin2:s taken 
together, I called Parr shortly after the convention. I said, "Dave, I 
want to come down and see you and talk with you quite frankly because 
I'm quite concerned about what's going on here." And I flew down 
there. 

It was my intention, as I did, I talked to him about the Nixon cam- 
paign committee contributions. I have already told you how in late 
1970 I was upset because I read in Congressional Quarterly and Na- 
tional Journal of massive contributions to Republican congressional 
and senatorial candidates who I knew to be sure losers, and they were 
huge contributions. And I recall on that occasion calling them and 
after that they did make modest, if not equal, contributions to the 
Democratic opponents after my call. 

Anyway, this struck me as being imrealistic and harmful. Then 
the Nixon contributions, then their conduct at the convention. So 1 
flew down. But I was surprised when I got there. Rather than Dave 
simply welcoming me and saying "What's up?" and "What are these 
things you are so upset about again? Let's talk it through." Instead, 
here are two stenographers and a very formal setting. 

Mr. Sanders. Why did you choose to meet with Parr as opposed to 
Nelson ? 

Mr. VAN Dyk. Because I knew Parr best. I looked on Parr as the 
most active political guv in AMPI, and in fact, I think mv request 
was to meet with both of them, as I I'ecall. I called and said. "T want to 
meet with" — I mav have called Nelson fii-st, and T said, "I want to 
meet with you and talk with you about this," and as I recall, the out- 



7027 

come of it was that I was to go to Little Rock and meet with Parr. So 
Nelson was not present, wasn't part of the meeting. 

Mr. Sanders. Was anyone else present when you talked with Parr, 
besides the stenographers ? 

Mr. VAN Dyk. No. 

Mr. Sanders. Did you make any notes concerning that meetmg, 
either during or after ? 

Mr. van Dyk. No. 

Mr. Sanders. Your present retainer for Dairymen, Inc. 

Mr. VAN Dyk. Is none. I resigned my relationship with them. 

Mr. Sanders. All right, at the time you were retained by them, you 
were receiving $1,000 per month ? 

Mr. VAN Dyk. Yes. 

Mr. Sanders. Was the type of service you were performing for them 
of greater difference than what you were performing for AMPI? 

Mr. VAN Dyk. Yes. I was spending far less time, paying far less at- 
tention. They basically needed periodic counsel re Democratic candi- 
dates and personalities and they needed counsel re legislative possibili- 
ties. But it was on a far less intensive basis and the understanding was 
that they couldn't expect much time because of the low retainer. 

Mr. Sanders. During the questioning by Mr. Weitz you were asked 
about, when we first began in general terms, about what you expected 
with regard to AMPI's contributions to political candidates. And 
you mentioned that you thought they would have separate advice for 
JRepublican political candidates. 

Mr. VAN Dyk. Yes, sure. 

Mr. Sanders. You said you assumed that they would be contribut- 
ing, vou hoped they would be contributing substantially to Democratic 
candidates because you knew that they had contributed in 1968. I well 
recognize that this may very well be objectionable to Mr. Weitz as 
beyond the scope of this committee, but I do want to ask you just one 
question. Do you know of any means by which — first of all, are you 
aware that TAPE was not created until 1969 ? 

Mr. VAN Dyk. I am not. I told you, I knew they were forming it, and 
I recall the discussion in 1969 in New York when we talked about them 
forming some such, but I never got working with them until late 
1969. 

Mr. Sanders. Do you know of any means by which AMPI in 1968, 
therefore, could have legally made political contributions? 

Mr. VAN Dyk. I don't know. I had nothing whatever to do with 
campaign financing in the 1968 campaign. I simply had no part in 
that. One could speculate that individual members made contributions. 
Who knows ? I did know, though, that they were identified to me as 
contributors. 

Mr. Sanders. You made some mention of meetings which you at- 
tended where other AMPI consultants were also present and you 
refer to these as "strategy sessions". 

First of all, could you identify who you had in mind as other 
Democratic consultants ? 

Mr. VAN Dyk. Well, they were people I would normaly see, and 
again, this would be no more than three or four times a year. And the 
strategy sessions, for instance, the 1971 legislative period, would be an 
example when the congressional situation was being discussed, on price 
support, other Democratic consultants who I knew to be associated 



7028 

with the AMPI, it induded DeVier Pierson, Jake Jacobsen, and Milton 
Semer, the late Cliff Carter, Jim Jones, now Representative Jim Jones, 
William Connell, I believe at an early stage Richard Magiiire, although 
I had the impression that later on, he no longer was associated, al- 
though I don't have anything to say that that is necessarily so. 

I think that w-as pretty much it. I always regarded — eight, at most. 
We might need one or two people. I was amazed that they w^ere retain- 
ing this many people. 

Mr. Sanders. And all of these persons whom you have just now 
named, you looked upon as consultants — probably consultants for 
AMPI with regard to Democratic politics? 

Mr. VAN Dyk. Yes, I so assumed. All had Democratic backgrounds, 
all had served with a Democratic President or legislator in some 
capacity. 

Frankly, I think they adopted a policy of, as I say, I think they 
looked on me as their ambassador to the Democratic liberal community. 
I think they looked upon each of these as their representative to a cer- 
tain segment of the party. I thought it was foolish. I thought one or two 
people could give them good advice about almost anything they needed 
to know. 

Mr. Sanders. Were any of these sessions concerning allocation of 
contributions ? 

Mr. VAN Dyk. No, no, no, no. Legislative strategy. Legislative out- 
look. Political outlook. But never did I hear contributions discussed in 
this context. 

Mr. Sanders. Did you ever hear a discussion in these sessions of 
moneys available in the dairy trusts which could be legally contrib- 
uted? 

Mr. VAN Dyk. No ; I think everyone Avas aware that there were large 
sums in the trust which were available for contribution, but I never 
heard any specific discussion of sums. 

Mr. Sanders. Were there discussions of which Democratic Presi- 
dential candidate the dairy cooperative should 

Mr. VAN Dyk. No, no; I had the impression as I first indicated, they 
first came to see me in late 1968. 1 had the impression they went broad- 
side around in the Johnson administration and the few people they 
knew within it, simply ad hoc, they offered retainerships. 

They were getting started. They didn't know what they were doing. 
I think they just indiscriminately grabbed on to some people and 
thought well, trial and error, we will find some w^ho are useful, some 
who are not. I thought it was a ridiculous way to do business, but it was 
always my judgment that that was the way they did it. 

Mr. Sanders. Are you saying that the only strategies discussed at 
these sessions related to legislative desires ? 

Mr. VAN Dyk. Legislative policy, political climate, never individual 
candidates, if only for the reason that everybody there had dif- 
ferent political allegiances and viewpoints. 

[Discussion off the record.] 

Mr. Hamilton. OK, I apologize coming in new" at the end of a long 
day and hitting you fresh. 

Mr. VAN Dyk. No, no, no; I'm just getting warmed up. 

Mr. Hamilton. I will try to be brief. When did your relationship 
with Norman Sherman begin ? 



7029 

Mr. VAN Dyk. I've been his friend since I first met him which was in, 
really, 1964. 

Mr. Hamilton. And did this friendship inspire any attempts that 
you had to help Valentine, Sherman sort of get off the ground? 

Mr. VAN Dyk. Sure. 

Mr. Hamilton. Why don't you tell us, in your own words, what 
you did in this relationship ? 

Mr. VAN Dyk. Sure. As far as AMPI was concerned, I recommended 
them, as I believe Bill Connell did, all three of us worked together for 
Senator Humphrey, to AMPI as skilled people who ran a direct mail 
survey operation which might be useful to them. Beyond that, I 
recommended them and I continue to, to any number of organizations ; 
political candidates, anybody else who could use their services. 

Hr. Hamilton. Who, besides AMPI, did you recommend them to? 

Mr. VAN Dyk. Oh, gosh, over the past several years, probably dozens 
of people. 

Mr. Hamilton. Political candidates ? 

Mr. VAN Dyk. Oh, 12, 15, any number of Democrats with whom I 
had acquaintance. 

Mr. Hamilton. Can you just for the record, tell us some? 

Mr. VAN Dyk. Well, specifically, as far as AMPI is concerned which 
I assume is your interest here 

Mr. Hamilton. Well, I'm going to get to that. 

Mr. van Dyk. Through AMPI, well the two specific instances which 
I think apply here, were the States of Iowa and South Dakota. After 
having made the introduction to AMPI, I understood that there had 
been an agreement that AMPI would use them, and in two cases I 
believe they undertook work at AMPI's behest in the States of South 
Dakota and Iowa where I had given them introduction, respectively, 
to Senators Abourezk and Hughes, then Representative Abourezk. 

Mr. Hamilton. Well I want to get to that, iDut I don't want to get 
ahead of myself. 

What is your understanding as to the initial contact between Valen- 
time, Sherman, and AMPI as to how it was arranged ? 

Mr. VAN Dyk. I think I, and I think Connell as well, mentioned to 
Nelson and Parr, one or more times, that they should talk to Valentine, 
Sherman to see if they could do business with them. 

Mr. Hamilton. Did you write any letter ? 

Mr. VAN Dyk. No; I don't think so. I think in discussion and I men- 
tioned it several times, and either Valentine, I know Sherman, I don't 
know Valentine, too, they went to see the AMPI people. Wlio they 
went to see — I guess it was Nelson and Parr, and dealt with them. 

Mr. Hamilton. Do you know when the initial contact was made? 

Mr. VAN Dyk. When Avould this have been? 1971? 1970? 

Mr. Hamilton. Do 3'ou know, specifically, when, where? 

Mr. VAN Dyk. I don't have — no, I never attached a great importance 
to it. It was kind of a casual thing. The work they did in South 
Dakota and Iowa was what, 1972 ? 

Mr. Hamilton. It was in 1971, 1 believe. 

Mr. VAN Dyk. Then it would have been early 1971. 

Mr. Hamilton. Were you present at the initial contact? 

Mr. VAN Dyk. No; you mean between them and AMPI? 

Mr. Hamilton. Yes. 



7030 

Mr. VAN Dyk. No. 

Mr, Hamilton. Wlien did you learn that some type of an agreement 
had been reached between AMPI and Valentine, Sherman? 

Mr. VAN Dyk. Oh, I don't know, sometime between the year 1971, 
either the AMPI people or Norman told me they were working, doing 
some work. 

Mr. Hamilton. Well, what was your understanding of the nature 
of the agreement ? 

Mr. VAN Dyk. I understood — two specific things I knew about>— I 
knew that they were undertaking political survey work in South 
Dakota, and that they had talked to the AMPI people about this, and 
South Dakota was a State in which they had an interest. 

In the case of Iowa, I had attended a breakfast or luncheon at which 
Senator Hughes was present, and the AMPI people had asked Senator 
Hughes how things looked in Iowa and he talked about it and he 
mentioned the possibility of Valentine, Sherman, and using Valentine, 
Sherman, and the AMPI people responded by saying, "Oh, yes, we 
know that, maybe we can be of some help on that." 

So those are two specific instances. Norman told me, also, that they 
were going to take some direct mail, I think to sell insurance to the 
AMPI members and to solicit new members, et cetera. 

Mr. Hamilton. Well, let's focus in on the Iowa situation and then 
we'll look at South Dakota. 

Mr. VAN Dyk. All right. 

Mr. Hamilton. Was it your understanding that there was some type 
of arrangement formulated before Iowa? In other words, sort of a 
broad understanding that Valentine, Sherman would do some political 
work that AMPI would pay for ? 

Mr. VAN Dyk. No, I think my first awareness, the first tangible 
thing I knew about was the Iowa thing in which I was involved and 
flowing from this, I remember Parr and/or Nelson saying, "Oh yes, 
Valentine, Sherman. We talked about them, maybe that's where we 
will get some help." I was not aware that they were necessarily doing 
anything prior to that. 

Mr. Hamilton. Well, did you arrange the Iowa deal ? 

Mr. van Dyk. Arranging, what I did was to put Norman in touch 
with Senator Hughes and with Ed Campbell in Hughes' office and 
that was my arranging. 

Mr. Hamilton. In other words, you called up Campbell in Hughes' 
office and said, "Would you talk to Norman Sherman ?" 

Mr. VAN Dyk. Yes, "Remember we talked the other day at the 
breakfast about Valentine, Sherman and Iowa ? Norman is going to 
call on you." And they took it from there. 

Mr. Hamilton. Well, at the breakfast in Iowa ? 

Mr. VAN Dyk. It wasn't there, it was here in Washington. 

Mr. Hamilton. And Nelson and Parr were at that breakfast? 

Mr. VAN Dyk. As were a number of other people. 

Mr. Hamilton. And you initiated the conversation and said 

Mr. VAN Dyk. No, no. Hughes was there, and Ed Campbell — his 
aide was there. In the course of things they were discussing the situa- 
tion in Iowa and what was going to happen and what the outlook was 
for congressional candidates and others. And Senator Hughes, I be- 
lieve, indicated, yes, they planned to possibly institute the Valentine, 



7031 

Sherman survey in loAva as a means of getting lists up-to-date of 
Democratic voters, et cetera. 

Whereupon, the AMPI people said, "Well, we have been talking 
with them, maybe that is somewhere where we can be helpful." And 
Campbell was sitting over here and I nudged him and we nodded. At 
the end of the meeting, I told the AMPI people, "I will have Valen- 
time, Sherman get in touch with the Hughes people and that" — which 
is what I did and that was it. 

Mr. Hamilton. How did Hughes know Valentine, Sherman ? 

Mr. VAN Dyk. Oh, they had seen them and had been calling on them, 
and I'm sure I introduced him to them. 

Mr. Hamilton. And you arranged that? 

Mr. VAN Dyk. Sure, sure. 

Mr. Hamilton. But you had not arranged, I take it, any besides 
the initial contact, you hadn't really arranged any further meetings 
between AMPI and Valentine, Sherman ? 

Mr. van Dyk. No, no, no, that was it. 

Mr. Hamilton. OK, what was your understanding as to what the 
work at Valentine, Sherman would do for Hughes ? 

Mr. VAN Dyk. Well I assumed — it wasn't for Hughes, it was for 
the Iowa Democrats, basically. Hughes, himself, was not a candidate 
to my recollection, in that year, but had an interest in the Iowa Demo- 
cratic Party and other Democratic congressional candidates and State- 
level candidates in Iowa. And I assumed Valentine, Sherman was 
going to do what tliey do in political races, which is computerize voter 
lists, get profiles of whether they're union members, how many kids 
are in the houseliold, liow many phones, data which can be used for 
direct mail for voter registration, for any number of political uses. 
And I assumed they were going to install that system in Iowa, and 
that AMPI was going to help pay for it. 

Mr. Hamilton. Did you liave any perception that this material 
might be used for Hughes' Presidential race in 1972? 

Mr. VAN Dyk. Oh, no, no. Why would Hughes need an Iowa voter 
list in running for President? I mean, you know, that's the last thing 
he would need. If Harold Hughes were running for President, he would 
need lists in other States. 

Mr. Hamilton. I understand that. I understand that. 

Mr. VAN Dyk. The understanding was, it was on behalf of the Iowa 
Democratic Party and other candidates in Iowa. 

Mr. Hamilton. Well, did you understand there was a possibility in 
1972, in the general election, that these lists might have been used in 
the general election ? Is there any reason why they couldn't have been ? 

Mr. VAN Dyk. I never tliought of that. You mean on Hughes' behalf? 

Mr. Hamilton. Well, w^hoever the Democratic candidate was. 

Mr. VAN Dyk. Oh, I never thought of that. I don't think anybody 
thought of it. I mean there was work to be done. As I recall, the pros- 
pect then was that John Culver was going to run against Jack Miller, 
it turns out he didn't, there were other congressional races under dis- 
cussion about statewide races. It was a Democratic project and Harold 
Hughes was like a grandfather — godfather of the Democratic Party — 
Iowa Democratic Party. 

Mr. Hamilton. Well, it was looking forward to the Presidential 
election? 



7032 

Mr. VAN Dyk. Was it 1970, or 1972? 

Mr. Hamilton. So, it was looking forward to the 1972 election? 

Mr. VAN Dyk. And/or general party use. 

Mr. Hamilton. OK, I take it if it was looking forward to the 1972 
election, it certainly would have been a potential that the same list 
could have been used in the Presidential context to get out Democratic 
voters ? 

Mr. VAN Dyk. Oh, I guess it's possible. I don't know that it ever 
was. I don't think anybody had it in mind in that discussion. 

Mr. Hamilton. So are you certain of that ? 

Mr. VAN Dyk. I mean it wasn't discussed. 

Mr. Hamilton. You are sure that it was not discussed ? 

Mr. VAN Dyk. It didn't enter into the discussion. 

Mr. Hamilton. That these lists could have been used by the State 
party in 1972 ? 

Mr. VAN Dyk. Nobody mentioned it. I have no knowledge that they 
were. 

Mr. Hamilton. Well, do you know of any reservation by Valentine, 
Sherman that the lists were not to be used for that ? 

Mr. VAN Dyk. I don't know. I don't know. 

Mr. Hamilton. Do you know if there was any contract between 
Valentine, Sherman and the Iowa people? Any written contract? 

Mr. VAN Dyk. I don't know. I don't know. 

Mr. Hamilton. Do you know how Valentine, Sherman was paid for 
the work they did in Iowa ? 

Mr. VAN Dyk. I don't know. I will say this, that in recent weeks, 
Norman Sherman, who rents office space from me, has told me that 
some of the work that they did was paid for by AMPI checks, whereas 
it probably should have been paid for by TAPE checks. He has told 
me that. 

Mr. Hamilton. Is that the first time that you knew that ? 

Mr. VAN Dyk. To my recollection — he may possibly have told me 
several months earlier, but I don't recall that he did. I know for cer- 
tain that he told me recently. 

Mr. Hamilton. But you don't remember contemporaneously 
knowing ? 

Mr. VAN Dyk. No. 

Mr. Hamilton. Do you have any knowledge now whether the peo- 
ple in Iowa, the people who wanted the list, knew contemporaneously? 

Mr. VAN Dyk. I have no idea, no. You know, everything I know is 
what I told you. 

Mr. Hamilton. Well, they obviously knew because they didn't pay 
the whole bill and because AMPI was in the picture — that some money 
from the milk people was coming. 

Mr. VAN Dyk. Oh, sure, that was — as I say, the milk people said, 
maybe we can help with it. 

Mr. Hamilton. But you don't know if they knew whether it was 
TAPE money or AMPI ? 

Mr. VAN Dyk. Well, I'm not sure. I'm not sure, but I would imagine 
they did. 

Mr. Hamilton. You mentioned Ed Campbell and Clark Easmussen 
in Iowa. "Wliich of these individuals dealt most directly with Valen- 
tine, Sherman ? 



7033 

Mr. VAN Dyk. I don't Imow. I only made the orig:inal contact 
through Hughes and Ed Canibell. Clark Easnuissen, I didn't mention. 
John Culver, I mentioned as a guy who was thinking of ruiming. 

At one time, Sherman may have called up and complained about 
lack of payment, in which case I would have called Campbell. I think 
Campbell called me once to complain about some irresponsiveness of 
Valentine, Sherman, in which case, I would have called Norman and 
passed on the complaint. I was just kind of the broker in this thing, 
They both knew me but didn't know each other as well. 

Mr. Hamilton. So was it your perception that Campbell was the 
main operative in this regard ? 

Mr. VAN Dyk. I don't know. All I know is I made the initial intro- 
duction to Ed Campbell and then Valentine, Sherman carried on their 
project. 

Mr. Hamilton. I wasn't trying to put a name in your mouth, but 
there is a letter in the file of Valentine, Sherman to Rasmussen, and 
that's why I mentioned the name. 

Mr. VAN Dyk. I don't know him. I don't know who he is. 

Mr. Hamilton. So I take it, if I asked you who in the Iowa opera- 
tion we should contact to find out their side of the story, you would 
say Ed Campbell, is that correct ? 

Mr. VAN Dyk. Well, I don't know what you mean by "their side 
of the story.'' Ed Campbell— I'm truthfully telling you that Ed Camp- 
bell was present at the meeting where Valentine, Sherman first came 
up and to whom Norman made his first contact. I know that to be 
true. The rest of it, I don't Imow. I don't know who they dealt with 
in Iowa. 

Mr. Hamilton. Do you have any correspondence relating to the 
Iowa arrangement ? 

Mr. VAN Dyk. That was my total role. That's it. 

Mr. Hamilton. Don, do you want to ask some more questions about 
Iowa before I move on ? 

Mr. Sanders. Yes, we might as well clear the record while you 
are on the subject. 

The breakfast was in Washington ? 

Mr. VAN Dyk. Yes, it might have been a lunch — it was a meal of 
some kind. 

Mr. Sanders. Senator Hughes was present? Can you put an ap- 
proximate time on this ? 

Mr. van Dyk. Oh, it would have been in 1971 sometime. This is, I 
refer to a series of breakfasts and luncheons we had with a number 
of Democratic Senators, attended by AMPI and other co-ops. 

Mr. Sanders. Who from AMPI was present ? 

Mr. VAN Dyk. I know Nelson and Parr were there. I believe there 
were some Mid-Am, some DI people present, and perhaps one or two 
AMPI officers. 

Mr. Sanders. Can you recall who said, for x\MPI, that maybe they 
might be able to help on the Iowa project ? 

Mr. VAN Dyk. It was probably Nelson and Parr. It was just kind 
of a general response, a nodding of heads. One of the two of them, or 
both. 

Mr. Sanders. Sherman was present ? 

Mr. VAN Dyk. No, no. 



7034 

Mr. Sanders. On some occasion previous to that, then, Valentine, 
Sherman had been in contact with the Hughes folks ? 

Mr. VAN Dyk. Yes ; I think so, yes. 

Mr. Sanders. Following that breakfast, what was the next event 
you can recall concerning AMPI assisting in payment for the Valen- 
tine, Sherman work in Iowa ? 

Mr. van Dyk. I don't recall any of them. That was the end of it. 
Anything else from there was worked out between Valentine, Sherman 
and AMPI. 

Mr. Sanders. No; you did tell us you may have had some call 
from 

Mr. VAN Dyk. Campbell, a Hughes man. 

Mr. Sanders. From Hughes, and you also said you might have had 
a complaint from Valentine, Sherman about a payment not received? 

Mr. VAN Dyk. That would have been from Hughes. In other words, 
I recall a couple of times along the line, during the time they were 
doing the Iowa work, there was a complaint by Ed Campbell about 
Valentine, Sherman. At one point I remember Valentine or Sherman 
called me with some complaint and I just passed on the complaints. 
Each one, apparently, called me out of futility in trying to get some- 
thing done with the other. 

Mr. Sanders. Did one of the complaints pertain to a nonpayment, 
or late payment? 

Mr. van Dyk. As I recall there was something about a payment and 
as I recall the Campbell complaint was about some printouts or 
things that were to have been delivered that didn't arrive on time, or 
something of that nature. 

Mr. Sanders. Do you know why they didn't deal with each other 
directly ? 

Mr. VAN Dyk. Oh, I'm sure they did. I am simply — you asked for 
my contacts and that was it. 

Mr. Sanders. Did you receive a fee for this project? 

Mr. VAN Dyk. This project? No. I received a fee for a total of 
$2,000 or something like that, in general, which Valentine, Sherman 
sent me at one point to be of general help in soliciting business for 
them, period. It didn't have anything to do with any particular proj- 
ect, to my knowledge. 

Mr. Sanders. And you didn't submit any bill to them for the Iowa ? 

Mr. VAN Dyk. I might have, but the understanding was that they 
would pay me a couple thousand dollars to do what I could for them 
and I did. 

Mr. Sanders. I want to ask you about the ]^hysical circumstances 
on the occasion of this remark by Senator Hughes, that Valentine. 
Sherman would be used for the work in Iowa, and the remark by 
Parr and Nelson that maybe they could help on that. Was this while 
the breakfast was still underway, or later? 

Mr. VAN Dyk. Yes, like I was sitting here and Hughes is where you 
were, and he was talking about what political prospects were in Iowa, 
what the various congressional races were, what he saw happening, 
and so on. And he was talking about plans and he talked — in fact, we 
had been talking about possibly using the Valentine, Sherman peo- 
ple to computerize, make lists, and so on, to be of help to us. And Parr 



7035 

<and Nelson who were over here said, "Maybe that's something we can 
help with." 

Mr. Sanders. Did Senator Hughes respond to that remark ? 

Mr. VAN Dyk. He nodded and I think, as I recall, Campbell was 
over here and I said to Campbell and Hughes, jointly, "I'll get back 
to you on that." 

Mr. Sanders. OK. 

Mr. Hamilton. The fee that you got, generall}', was that by Valen- 
tine, Sherman check? 

Mr. van Dyk. I'm sure it was, yes. 

Mr. Hamilton. In other words, it wasn't AMPI money? 

Mr. VAN Dyk. No, just Norman sending me a check. 

Mr. Hamilton. Well, let me ask you about the— unless Dave or 
Alan have any questions on it ? 

Mr. Weitz. No. 

Mr. DoRSEN. No. 

Mr. Haimilton. Let me ask you about the Iowa situation and maybe 
again if you'll just tell us in your own words, how it came about, 
what you did and 

Mr. Warnke. Is that Iowa, Jim? Or South Dakota? 

Mr. Hamilton. South Dakota, excuse me. 

Mr. VAN Dyk. That one is very simple. Jim Abourezk is a friend 
of mine. He told me he was going to run for Senator in South Dakota 
and we were talking about what he had to do. He ought to take a poll. 
They ought to get some media done. I told him, "Well one of the things 
you've got to look at is how Valentine, Sherman people do the com- 
puter survey work." I said, "I will arrange an appointment for you 
to see them," period. That's it. And they saw them and they did the 
business. 

Mr. Hamilton. So your dealings were with Abourezk directly? 

Mr. VAN Dyk. Yes. All I did was arrange an appointment, give him 
a high recommendation, and that was it. 

Mr. Hamilton. Do you know who met with Abourezk ? ^Vliether it 
was Shennan or 

Mr. VAN Dyk. I suspect it was Norman, because he is kind of the 
salesman of the two, but I am not sure. 

Mr, Hamilton. How did AMPI get into the Abourezk situation ? 

Mr. VAN Dyk. I think Nonnan may have talked to them, or I sim- 
ply have the general impression that they probably were involved 
there and I don't know where to tag it. Maybe they weren't. I don't 
know. 

Mr. Hamilton. Did you do anything to get AMPI involved in 
South Dakota? 

Mr. VAN Dyk. Not that I can recall. 

Mr. Haisiilton. Do you know who told you that they were involved ? 

Mr. VAN Dyk. It might have been Norman, it might have been Parr 
or Nelson. I simply had a general impression that somehow AMPI 
was involved in that South Dakota project. 

Mr. Hamilton. Well, do you know any details about the payment 
arrangement to Valentine, Sherman ? 

Mr. VAN Dyk. No. Well, whoever paid them, paid them — I simply 
have the general impression that AMPI played a role in it. 



7036 

Mr. Hamilton. Do you have any correspondence or any documents 
relatin^r to the Iowa situation ? 

Mr. VAN Dyk. Tlie South Dakota situation '? 

Mr. Hamilton. South Dakota. 

Mr. van Dyk. No, only that I met with Jim Abourezk. 

Mr. Hamilton. Do you remember when you met with Jim 
Abourezk ? 

Mr. VAN Dyk. 1971, I believe. He ran in, what, 1972? 

Mr. Hamilton. Yes. 

Mr. VAN Dyk. It would have been about the summer of 1971. 

Mr. Hamilton. The summer of 1971 ? 

Mr. VAN Dyk. Yes. 

Mr. Hamilton. Was your discussion with Abourezk confined to the 
senatorial campai^ ? 

Mr. VAN Dyk. Oh, yes, sure. I mean I w^as a friend of his and I was 
in his office and he said, "I am going to run for the Senate, I've never 
done it and what should I be doing ?"' 

And we talked about various things he should be doing and he 
mentioned the Valentine, Sherman thing. I said "It would work, I'll 
send them in to see you," et cetera. 

Mr. Hamilton. Again, did you have any conversations with him 
about the use of the list for other campaigns? For example the 1972 
Presidential campaign ? 

Mr. VAN Dyk. No. 

Mr. Hamilton. Do you know if there were any restrictions in the 
arrangement between Valentine, SheiTnan and Abourezk that would 
have disallowed the use of this list ? 

Mr. VAN Dyk. No, I don't know anything about that. 

Mr. Hamilton. Did either Abourezk or Snerman confide in you, 
or talk to you later on, about the progress of the work in South 
Dakota? 

Mr. VAN Dyk. Again, I maj' have had a — I'm not even sure that's 
so, but the company went through a terrible, painful growth period 
when they took on more business than they could handle, and they 
got a lot of complaints from a lot of places, and it may well be that 
Abourezk called me and complained about something, and if so, I 
would simply have passed it on. I don't recall in this instance. 

Mr. Hamilton. Do you know if Norman or Valentine called you to 
complain about nonpayment? 

Mr. VAN Dyk. They might have, but I don't recall that they did. 

Mr. Hamilton. And do you know if anybody besides Abourezk Ttas 
dealing with 

Mr. VAN Dyk. Whoever was running his effort, I'm sure that he 
turned them over to his campaign people once the thing got started. 

Mr. Hamilton. You don't know who that would have been? 

Mr. VAN Dyk. I don't know who it would have been. 

Mr. Hamilton. Don? 

Mr. Sanders. Along the same line, I don't recall that we asked 
you similar questions pertaining to Iowa, that is, do you have any 
knowledge about any eventual payment of AMPI on the Iowa bill ? 

Mr. VAN Dyk. No. Again, all I know^ in the aggregate is what Nor- 
man has told me recently 



7037 

Mr. Sanders. No, I mean contemporaneous with these transactions. 

Mr. VAN Dyk. No, I don't even know if it applies to Iowa. He told 
me that some of the work he did for AMPI, they were paid by AMPI 
rather than a TAPE check which would have been appropriate or 
proper. I don't know for what work or what States or what was in- 
volved. 

Mr. Sanders. Do you recall ever learning in 1971, to what extent — 
first of all, did you know what the project was going to cost, the Iowa 
project? 

Mr. VAN Dyk. Oh, I probably did at one time. Is it $50,000 or $60,- 
000? Maybe that is the number, I don't know. It just came into my 
head. 

Mr. Sanders. Did you, at any time in 1971, learn of the extent to 
which AMPI would fund this project? 

Mr. van Dyk. No. 

Mr. Sanders. Do you have any recollection of telling Norman Sher- 
man a certain amount to be paid by AMPI ? 

Mr. VAN Dyk. I might have. I don't have any specific recollection of 
it though. I would have all taken place in this same frame, when 
the discussion took place. I am sure whatever he said is accurate. 

Mr. Sanders. Were you to have any responsibility for obtaining the 
AMPI money to be paid to Valentine, Sherman for the Iowa work or 
to insure that it was paid ? 

Mr. VAN Dyk. No. Somebody has told me that Jack Valentine claims 
to have called me at some point and complained about lack of payment, 
that he asked me to call AMPI and that I did. I don't recall, but if he 
says that that is so, I believe it. 

Mr. Sanders. Did you know in 1971 that Valentine, Sherman had 
met with — had met in Louisville and made a proposal to AMPI? 

Mr. VAN Dyk. In Louisville ? 

Mr. Sanders. Yes. 

Mr. VAN Dyk. Not specifically, no, I don't recall that. 

Mr. Sanders. Were you ever aware in 1971, that the written proposal 
had been made by Valentine, Sherman to AMPI ? 

Mr. VAN Dyk. I may have then, but I don't recall it. 

Mr. Sanders. Have you ever seen such a written proposal ? 

Mr. VAN Dyk. I don't think so. 

Mr. Sanders. Well, from your previous statement I gather it may 
be that Valentine called you and said that some money was due from 
AMPI? 

Mr. VAN Dyk. He could have, yes. He has told me that, Norman 
has told me that, and if they say it, they're truthful people. I don't 
know. It would have been characteristically something I would have 
done, sure, if they had asked me. 

Mr. Sanders. Aside from calling Campbell, do you have a recol- 
lection of calling Parr or Nelson in order to expedite the AMPI pay- 
ment? 

Mr. VAN Dyk. I may have, if they say I did. I don't recall it, 
though. 

Mr. Sanders. Did you ever make a visit to the State of Iowa in con- 
nection with this work with Valentine, Sherman ? 

Mr. VAN Dyk. No. 



7038 

Mr. Sanders. Jim, I don't believe we have the documentation on the 
fee that Mr. van Dyk got for the Valentine, Sherman work. 

Mr. Hamilton. I don't believe we do, either, even though we may, 
after this week. 

Mr. VAN Dyk. They would have a check. It would have been a Valen- 
tine, Sherman check. As I recall, it was for a couple thousand dollars. 

Mr. Sanders. But would you not have submitted an invoice for it ? 

Mr. VAN Dyk. I don't recall, I don't recall. I can look and see. 

Mr. Sanders. Did you know in 1971 what was to be the total cost 
of the South Dakota project? 

Mr. VAN Dyk. No. 

Mr. Sanders. Did you know in 1971 what amount of the cost of the 
South Dakota project was to be paid by AMPI? 

Mr. VAN Dyk. No. 

Mr. Sanders. Do you have any recollection of telling Valentine or 
Sherman what portion was to be paid by AMPI on the South Dakota 
project? 

Mr. VAN Dyk. No. I don't even recall having an involvement in 
that one beyond being introduced to Jim Abourezk. 

Mr. Sanders. Do you recall being told by Valentine or Sherman 
that the South Dakota list could be used by McGovern ? 

Mr. VAN Dyk. No. 

Mr. Hamilton. Well, we know from other sources that Valentine 
and Sherman also performed similar services in Oklahoma and 
Kansas, and as to each of those States, take Kansas first, do you have 
any knowledge of that arrangement ? 

Mr. VAN Dyk. No, I don't. 

Mr. Hamilton. As far as who was contacted, how it was set up, how 
it was paid? 

Mr. VAN Dyk. No, I don't, I believe Bill Connell had made contact 
with people in those two States on their behalf, Oklahoma and Kansas. 
He knew people, had friends there, as I hap)pen to know people in 
Iowa and South Dakota. 

Again, I made a lot of solicitations for them that didn't work out. 
I think Bill probably did the same. 

Mr. Hamilton. You had nothing to do with Kansas ? 

Mr. VAN Dyk. No, nor did I have anything to do with Oklahoma. 

Mr. Hamilton. And I take it that you have no knowledge of the 
details as to the transaction. 

Mr. VAN Dyk. All I know is that I didn't work there. 

Mr. Hamilton. You don't know how much was paid, how it was 
paid, who paid it? 

Mr, VAN Dyk. No. 

Mr, Hamilton. What type of work they did, specifically, what it 
was going to be used for ? 

Mr. VAN Dyk. I assume it was the same kind of general work as I 
described in Iowa. I have no basis for knowledge. 

Mr. Hamilton. Do you have any reason to believe that the work 
they did in those two States was Presidential election, was going to be 
used for Presidential campaign ? 

Mr. VAN Dyk. No. 

Mr. Hamilton. Do vou have any knowledge that — Don, unless you 
want to ask some questions. 



7039 

Mr. Sanders. No, thank you. 

Mr. Hamilton. Do you have any knowledge of payment by AMPI 
for work done for Humphrey by Valentine, Sherman? 

Mr. VAN Dyk. No. 

Mr. Hamilton. Do you have — I'm not talking only of contempo- 
raneous knowledge, I'm talking of current knowledge. 

Mr. VAN Dyk. No. 

Mr. Hamilton. It doesn't ring a bell in any context ? 

Mr. VAN Dyk. No. You see, I worked for Senator Humphrey from 
1964 to 1968 and beginning in that— when we got into that 1972 
Presidential campaign from mid-1971 onwards, I was helping Sen- 
ator McGovern, so I just wasn't involved with the Humphrey people, 
although they remained my friends. I had good relationships with 
them. 

Mr. Hamilton. So from mid-1971 on you were with McGovern 
and you didn't know anything about Humphrey's campaign, say in 
the fall of 1971 ? 

Mr. VAN Dyk. No; and I was in Florida in the primary of April 
1972, I saw Norman down there and he told me he was doing work 
there for Senator Humphrey. 

Mr. Hamilton. What is your understanding of Jack Chestnut's 
role vis-a-vis Valentine, Sherman, and AMPI ? 

Mr. VAN Dyk. I don't know. Norman has told me, as you say, con- 
temporaneously, tliat Jack was consulted legally at some point by 
them. That is all. 

Mr. Hamilton. Do you know if Chestnut was involved in the pay- 
ments from AMPI to Valentine, Sherman? 

Mr. VAN Dyk. I don't know. 

Mr. Hamilton. Do you have any other details concerning Chest- 
nut's relationship with either AMPI or Valentine, Sherman besides 
what Norman told you ? 

Mr. VAN Dyk. No, that's all. 

Mr. Hamilton. Did you know that Chestnut was under retainer 
from AMPI? 

Mr. VAN Dyk. No ; I did not. 

Mr. Hamilton. Do you have any further information concerning 
the connection of Bill Connell with Valentine, Sherman besides what 
you told us ? 

Mr. VAN Dyk. That's all. Bill, of course, remained active in the 
Humphrey campaign, but the only knowledge I have is what I have 
told you ai30ut the Kansas and Oklahoma assistance. 

Mr. Hamilton. Which you've already told us about. You don't 
know if Connell was doing anything else for them ? 

Mr. VAN Dyk. No. I think he was doing as I was, although I only 
knew of those two. Everybody he knew to whom he could recommend 
them to, he did. 

Mr. Hamilton. Do you know of any AMPI commitment to Sen- 
ator Humphrey? 

Mr. van Dyk. No. You mean this time ? 

Mr. Hamilton. This last time around, in 1971. 

Mr. VAN Dyk. No. 

Mr. Hamilton. Do you know of any AMPI commitment or pay- 
ments or supplying of goods or services to Congressman Mills? 



7040 

Mr. VAN Dyk. No, I do not. I believe they made a contribution to 
Congressman Mills which I saw ijublicly stated. 

Mr. Hamilton. I take it that was a TAPE contribtuion. 

Mr. VAN Dyk. That's what I mean, yes. 

Mr. Hamilton. I take it also that there was no AMPI contribution 
or TAPE contribution to Senator McGovern. 

Mr. van DYii. Thafs correct, that's correct. Before you came in 
we went all through that here. 

Mr. Hamilton. Oh, well I certainly don't want to, then. Have you 
talked to the prosecutors ? 

Mr. VAN Dyk. Yes. 

Mr. Hamilton. Have they, in regard to the AMPI or Valentine, 
with regard to the Valentine, Sherman connection, which I'm sure 
they've gone into other things with respect to AMPI, with regard to 
Valentine, Sherman matter, did they cover any areas that we haven't 
covered here ? 

Mr. VAN Dyk. No. In fact, they were less interested. Quite frankly, 
their primary concern was, did T know or did I have any reason to 
believe that they had been paid by general AMPI funds, and I said 
I had been told by Mr. Sherman recently that that was the case. 

Mr. Hamilton. Well, that obviously is what we are interested in, 
too. Are there any other details in regard to Valentine, Sherman, and 
AMPI that perhaps we haven't asked you ? 

Mr. VAN Dyk. No. Let me just say this on behalf of Valentine, Sher- 
man, because these are good people. I mean, they had a service. They 
started from scratch. They had a lot of trouble with the work be- 
cause their computers broke down and they got into foulups and so 
on. Neither one of these people is a devious person, and any difficulty 
they got into was unintentional and goodhearted. 

I don't know what more you can say. I know that doesn't couiit for 
anything, but they are good souls who wouldn't knowingly do any- 
thing that they regarded to be wrong. 

Mr. Hamilton. Well, let me ask'you a question about that. Wasn't 
it your understanding that the work that was being done in Iowa and 
in South Dakota was purely political? 

Mr. VAN Dyk. Sure. 

Mr. Hamilton. Did you know that there was some type of bogus 
arrangement that Valentine, Sherman would supply them with farm- 
ers' names as a coverup for the political work they were doing ? 

Mr. VAN Dyk. No ; I did not. 

Mr. Hamilton. Have you heard of that before right now ? 

Mr. van Dyk. No ; I have not. 

Mr. Hamilton. This is the first time ? 

Mr. VAN Dyk. Yes. 

Mr. Hamilton. That has been broached to you ? 

Mr. VAN Dyk. That is correct. 

Mr. Hamilton. And Norman didn't tell you in the summer of 1971 
that they were supplying certain rural i-oute names to 

Mr. VAN Dyk. No. Norman told me that in the course of their busi- 
ness with — he's told me that part of the work they did for AMPI was 
nonpolitical. He has told me that. That's what I knoAv. He told me they 
put together a list to sell insurance to their members, some insurance 
plan, and a list of rural box people to try and enlist new members, 



7041 

and so on. Then there was work that was not political which they also 
didforAMPI. 

Mr. Hamilton. Was it your impression from what he told you that 
this was legitimate ? 

Mr. VAN Dyk. Sure. I mean, that's all he told me. 

Mr. Hamilton. He gave you no further details ? 

Mr. VAN Dyk. No. 

Mr. Hamilton. Do you have any perception that any of the people 
in Iowa or South Dakota knew that AMPI, for the money they were 
paying Valentine, Sherman, was also going to get rural route lists as 
well as the particular candidate ? 

Mr. VAN Dyk. I don't know ; I don't know. 

Mr. Hamilton. So you have no perception or knowledge of that ? 

Mr. VAN Dyk. I don't know. 

Mr. Hamilton. Did Sherman ever talk to you about the fact that 
records of the dealings between Valentine, Sherman, and AMPI had 
been falsified? 

Mr. VAN Dyk. No. 

Mr. Hamilton. Do you know anything about that? 

Mr. VAN Dyk. I do not. 

Mr. Hamilton. Nobody has broached that subject with you until 
right now ? 

Mr. VAN Dyk. That is correct. 

Mr. Hamilton. Besides the States we've talked about — ^the four 
States we have talked about— do you know any other State where 
Valentine, Sherman, did work, political-type work for which AMPI 
paid? 

Mr. VAN Dyk. No. Florida — Florida ; oh, not AMPI. No, I'm sorry. 

Mr. Hamilton. OK, Don. 

Mr. Sanders. I believe you told us that this breakfast where Senator 
Hughes was present, it was the first event known to you whereby there 
was some indication that AMPI would be working together with 
Valentine, Sherman. 

Mr. VAN Dyk. As I recall, I had known that we had recommended 
them. I had known that Valentine, Sherman, had gone down to talk 
to the AMPI people, and I don't recall in the intervening I knew that 
anything had developed or not. I do know that this transpired. 

ISIr. Sanders. Well, then it did appear to you that they had been in 
contact. 

Mr. VAN Dyk. Oh, I knew they had been down there. I knew Valen- 
tine, Sherman, had been to see the AMPI people. I knew they had 
solicited their business and we had recommended them. 

Mr. Sanders. But you had not heard that they had concluded any 
agreement. 

Mr. van Dyk. No, I didn't. If I did, I didn't place any great im- 
portance to it. 

Mr. Sanders. To your knowledge, is Campbell still working for 
Senator Hughes? 

Mr. VAN Dyk. Oh, I think so ; sure. 

Mr. Sanders. Do you maintain a calendar, or appointment book by 
which you recall meetings you have or — why don't we start with 
meetings ? 



30-337 O - 74 



7042 

Mr. VAN Dyk. Yes; usually I have one for the year and the year 
before which I keep. 

Mr. Sanders. Do you have a calendar or appointment book for 1971 ? 

Mr. VAN Dyk. I will look. I know I've got 1972 because I just filed 
it, and I've got this year's. Wliether I kept 1971, I can find out. For 
1971, it's unlikely. 

Mr. Sanders. If you have 1971, we would be interested in any en- 
tries pertaining to Valentine, Sherman, or any arrangements with 
AMPI in relationship to Valentine, Sherman. 

Mr. VAN Dyk. Well, an appointment book won't^ — I mean, I have 
said the sum total of — ^the appointment book wouldn't show anything 
with Valentine, Sherman, you know. I never had a formal meeting 
with AMPI, with them or anything else. The sum total of my dealings 
with them and AMPI was reconunending them. 

Mr. Sanders. Do you or your secretary make any, or keep any, log 
of telephone calls ? 

Mr. VAN Dyk. No. 

Mr. Hamilton. I only have one more question. 

Mr. Dorsen. Jim, I have one more question, too. 

Mr. Hamilton. OK. My only other question is whether or not you 
have any reason to believe that any of the money paid AMPI, paid by 
AMPI to Valentine, Sherman, was passed through to any political 
candidate. 

Mr. VAN Dyk. I do not. 

Mr. DoRSEN. The question I have, I tliink, has been asked in a some- 
what different form, but do you have any knowledge that any of the 
work done by Valentine, Sherman, and paid for by AMPI, was in any 
way utilized in the 1972 Presidential campaign ? 

Mr. VAN Dyk. No, I have no such knowledge. 

Mr. DoRSEN. Let's go off the record for a second. 

[Discussion off the record.] 

Mr. VAN Dyk. I think it should be made clear that when I refer to 
AJSIPI, I refer generically to AMPI as the parent organization of an- 
other organization. My ties, my relationship, was with AMPI. Harold 
Nelson and Dave Parr were AMPI people, and so any relationship 
with them I referred to as an AMPI relationship, regardless of 
whether, in fact, it might have involved a TAPE activity or not, 
TAPE being a subsidiary of AMPI. 

Mr. Warnke. And am I correct, Mr. van Dyk, in understanding 
then that when you referred to a payment by AMPI, that could refer 
to a payment from TAPE funds ? Is that correct? 
Mr. VAN Dyk. It could ; sure. 
[Discussion off the record.] 
Mr. DoRSEN. If we could go back on the record. 

I believe there are no more questions this afternoon, and we would 
like to express our appreciation to Mr. van Dyk for spending the after- 
noon with us. Thank you. 

[Whereupon, at 5 :"59 p.m., the hearing in the above-entitled matter 
adjourned.] 



7043 



Van Dyk Exhibit No. 1 




'»:n Van Dvk AHM(iriAiT:ii. In« 

U«4 iTry rraK«T. .s. «. 
W4MUI\OT(»N. I». ». SIMIS* 



v« Thoueand Collars and 00/100 
AWI^ Convent Ion Project 



•WTlonAI. •«•>■ 




>»:osu-oia5»: eo »-«.•.«.- »*• 



■srr 1 «k'.0 C0'.> I 






^ 



C^ 



i-'^ 



^^ 



\ 



M 



J. 



7044 



Van Dyk Exhibit No. 2 



1970 



INCOME TAX INFORMATION 


SOCItL UCUlin [HFaVMHIOK 




2,945.60 


18.541.68 


""■"'"° 


374.30 


7,000.00 






r ^,,., . ., 

005-40-6467 , 

Xlrty Jonea 

3807 Umleiwood Road 

Chovy Cliose, Muryland ' ' 


a 


a- 




' 












52-0893941 D. C. 89583 
TWd Van Dyk Aseoclatoe, Inc. 
1224 17tli St., H. H. 
WoflhlogtoQ. D. C. 20036 


i 


iSiB 





Form 1099— U.S. INFORMATION RETURN FOR CALENDAR YEAR 1970 

(Pleow keep thij copy — Do rot attach to your income tan return) 



Copy B 
For Payee 



'—-^ 005yM-6467 



Klrbv Jones 

3807 Underwood Road 

Chevy Chase, Maryland 



TO WHOM PAID n a. t 



f^ 



52-0893941 

Ted Van Dyk .■■,S30C. , Inc. 
1224 17th Street, N. W. 
Washington, D. C. 20035 



7045 



Van Dyk ExraBiT No. 3 



KiRBY Jones 
P. Brandon Jones 

3807 Ht>IDERWOOD STREET 
CHEVY CHASE, MARYLAND — ZOOIS 



544 







The RIGGS NATldNAL iBANK ff ^ ^^^ 
o/'vashinoton; D.C •' S- 

CHEVY CHASE OFFICE -V 

- AVE. a MORRISON ST.. N.'W.' ~ . 



.i:o5i,0'"000 3i: oa"'0 5 5»,qia2M- 




.'•000 lOOOOQO.-* 



^ 



. t: 









S 



:^ 



«::; PAY ANY«ANK.t/ & ;>4^||o /i? 



' — > m > 

r -" ^ ?!^5 



pi 



Van Dyk Exhibit No. 4 



Tku Vab Dvii Ammhi.vtkm. Ut 



- Il ■ ■ .M«— >B»&J^»»y ft I T^' 






li^JMcSW f kJ A *^ <l^^V-^vx Voi.;U.«JL*Y» -Clco 



IklLlJUHl 



Tn> rAk D«» AVMICMTM. ■«% 



>OOk2OOOO0< 






7046 



Van Dyk Exhibit No. 5 



MARKETING AND ATTITUDE RESEARCH 
53 BANK STREET (609) 924-9600 PRINCETON, NEW JERSEY 

January H, 1971 

Ted Van Dyk Associates 
1224 17th Street N. W. 
Washington, D. C. 20036 



COPY 

For professional services rendered in connection with 
a study entitled "Democratic Opinion in West Virginia 
& Wisconsin", 400 interviews in each state conducted 
between December 11, 1970 and January 11, 1971. 
(GO 70126 & GO 70127) 



^m 



7047 



Van Dyk Exhibit No. 



ASSOCIATED MILK PnODUCERSJMC. 

PHONE A/C 512 341-8651 TELEX 74-7444 

P.O. BOX 32287 

SAN ANTONIO, TEXAS 78214 



N9 3627 



R1|iim^l9^71if^0Bifir 



«; 19,573.03 



ASSOCIATED MILK PRODUCERS, INC. 
TED VAN DYK ASSOaATES, IMC. 
' 1224 Seventeenth Street, N. W*7Jo^>iT«s«v3rae:nJS\^<;.V-?',/J^ 
Washington, D. C. 20036 ■ . V:^/'v^ii<^«..;;LJ^.clr;.:r^-^ '■-/(^■Ua^. CJ, >,l^l:-^^y ^ • 



ASSOCIATED MILK PRODUCERS, INC. 



Legal Expenses - November 



;coscccccoo 

8-16-99-00 



7048 



Ted Van Dyk Associates, Inc. 



teOZ) 763-3337 



December 1, 1970 



TO: Associated Milk Producers, Inc. 
GPM Building -- 4th Floor 
San Antonio, Texas 78216 



Direct Expense, November $5,328.42 

Direct Expense due 14,244.66 

TOTAL DIRECT EXPENSE $19,573.08 



1 




7049 



Van Dyk Exhibit No. 7 



n 



Box 1641 

Rapid City, South Dakota 57701 

September ig , 1971 



Mr. Ted Van Dyke 
Ted Van Dyke Associates 
1224 17 Street N.W. 
Washington, D.C. 20036 

Dear Mr. Van Dyke: 

For professional services rendered as follows: 

Legal research, consultation and advice $2857.00 
Sales tax at 5% 142.85 

$2999.85 

Sincerely 



Charles J. Mickel 
Attorney at Law 



i12>l 



7050 



Van Dyk ExfflBiT No. 8 



ASSOCIATED MILK PRODUCERS. INC. 

PHONE A/C 512 3441392 TELEX 76-7446 

P. 0. BOX 32287 

SAN ANTONIO, TEXAS 78216 



N^ 



1980 



Aug ust 7, 



WS^^^fri 2 !^ O O ^ i^O O cts . 2.500.00 



TO TH« ORDER < 



ASSOCIATEP MILK PRODUCERS, INC. 



TED VAN DYK AssoaATEs, iNc.-T:;i^w;^^;(7i,";sc«;^?9Tv^j)"^^ 

1224 Seventeenth Street, N. W/-'- •'**^^'*»~--^-«^'^ "A"''^^-^^^ 

Washington, D. C. 20036 



ASSOCIATED MILK PRODUCERS, INC. 



7/31/70 



Payment to Kenneth Olson 



2,500.00 



7051 



Ted Van Dyk Associates, Inc. 



'# 



122^ SEVENTCCNTH STREET, N. 
WASHINGTON, O. C. 2O036 



(ZOZ< •'■63-3337 



July 31, 1970 



TO: 



Attn: Bob Lilly 
Associated Milk Producers. 
GPK Building 
San Antonio, Texas 78216 



Inc. 



For payment to Kenneth Olson: 

For consulting services on behalf 
of AMPI 



$2,500.00 



t>Mt 







7052 



Van Dyk Exhibit No. 9 



AS'XCI/.Vl-J milk PliODUCFSS, 



ipr.:,fln, i.1. C. ;i.0C'3S 



ASiOClATED MILK FTODUCi/i. INC. 



Profcsiiior, 1 

iSF-^l Fee - July-Sc-.'tBrJiOr 1970 
Proietslonal 



7053 



.1 o ■ i 



I!-r;ix(-d :it=:.terr.cnt Attricheu) 3.j:. 

TO'i^AA, BUS'! ^ri-^^-^^ 






7054 



oTAT]^i-ii';N'i'. Q]:' D.iMi.CT jsxraii:;]!: 



Con::ult.a]^t ' s J''(:;c^ l-lr , Gl'^on 

^"t-rrvul^ Entci'to..b:T::Gnt and 
htpreGentaiion 






:) and direct offD.ce 

TOTAL DUE 



$?. 500.00 

•119.;^ I 
333.00 



$3,733. 



7055 
Van Dyk Exhibit No. 10 

July 23, 1970 



Mr. Ted Van Dyk 
Vaji Dyk Associates, Inc. 
1224 Seventeenth Street N. W. 
Washington, D. C. 20036 

Dear Ted: 

Enclosed are two checks in the ainoLmts of $ 1,750 and $ 1,650 
r.-.ade out to Ilaine for Muskie and Kuskie Election Coioraittes 
respectively. 

These two checks along with the checks" frcra Dairymen,- Inc. and 
Mid-A::ierica make a total slightly in excess of $ 10,000- 

Sincorely, 

ASSOCIATED MILK PRODUCERS, INC. 



Bob A. Lilly 

Assistant to the General -lanager 

EALikb 

Enclosures — checks # 1002 £■ 0989 



7056 



lI^ 



MibeKtij 



1002 



THE .yL,LOS/UH NATIONAL BANK 

AND TRUST COMPANY OF OKLAHOMA CITY dati_ 

Maine for Muskie 



July 24. iq70 



execuiivepj;;! 



clubt 



< 1.750.00 



♦♦♦SEVENTEEN HUNDRECJ FIFTY and No/100**-' 



STUART H. RUSSELL 






J 



i:io30"'00 isi: ii'i?a s3Q 2"* 



J^lbe/itij 



NO. 0989 



THE ^^£/t^y NATIONAL BANK ^''^^clubS] 

AND TRUST COMPANY OF OKLAHOMA CITY r,.^ July 2A . 1970 

oRyf^' tluskie Election Committee. 



<; 1,650.00 



- - -Sixteen Hundred Fifty and No/100- 



STUART H. -RUSSELL 



i:iG30."Oo;si: u'l?^ ^33 eu 



7057 



Van Dyk Exhibit No. 11 



STUART H. RUSSELL 

AnORNEY AT lAVt 

}<K9 FISSI NATIOMAl BUIIDIMO 

OIOAHOMA OTY, OKLAHOMA 73)02 






Nove.nbe.-x 



1970 






Sulie.5^ 

bJapi€nc\.ton, V.C. 200GS 

GzntZtme.n: 

At the. /ie.qm&t of, Ufi. Bob Llllif , o^ 
Kiii>oclate.d 'A-itk. PA.odace.Jii, Inc. a^k San AntonJ..o, 
Texas, encZo&e.d licicio^th tjoa w-ilZ f,-ind my check 
'250, payable to the. f'.a6hte Election Conmi.tte.e. 
In the. pnJ.nclpat iura o^ ^S ,000 .00 . 



Ple.a6e. contact me tf, you havz any 



quCit-com . 



SHR:jh 
EncloAufLC. 



youA.& vzny tfialy, 



STUART H. RUSSELL 



)b Lllln 



30-337 O - 74 - Bk. 16 



7058 



Van Dyk Exhibit No. 12 



EDMUND S. MUSKf 



V 



/ 



^UxMcly ^{a{cs Senate 



IINCTON. O C. 




Mr. Harold S. Nelson 

Associated Milk Producers, Inc. 

1011 N.W. Military Highway , ■ 

San Antonio, Texas 78213 

Dear Harold: 

Milton Semer has given me a summary 
of the generous contributions you have in- 
spired among your colleagues and friends. 
I hope you will convey my thanks and best 
wishes to Dave Parr and Bob Lilly for their 
continuing support. 



_g» (U-c-A— V— >,___k 



Edmund S. Muskie 



RECEIVED AUG 2 7 1370 



FRIDAY, JANUARY 25, 1974 

U.S. SenxVte, 
Select Comjiittee on 
Presidential Campaign Activities, 

Washington^ D.C. 

The Select Committee met, pursuant to notice, at 2 :20 p.m., in room 
G-334, Russell Senate Office Building, Senator Joseph M. Montoya, 
presiding. 

Present : Senator Montoya. 

Also present: David Dorsen, assistant chief counsel; Alan Weitz, 
assistant majority counsel; Fred D. Thompson, minority counsel; 
Benjamin Plotkin, minority investigator. 

Senator Montoya. Would you state your name, first, please? 

Mr. Alagta. My name is Damian Paul Alagia, Jr. D-a-m-i-a-n 
A-1-a-g-i-a. 

Senator Montoya. Would you raise your right hand ? 

Do you swear to tell the truth, the whole truth, and nothing but 
the truth, in the testimony you are about to give, so help you God? 

Mr. Alaglv. Yes, sir ; I do. 

Mr. Weitz. Would the counsel identify themselves, please? 

Mr, Miller. John T. Miller, Louisville, Ky. 

INIr. Alagia. That is my law partner. 

Mr. Brow^n. I am John Young Brown of Kentucky — Louisville, 
also. 

Senator Montoya. Are you an attorney, too ? 

Mr. Brown. Yes, sir, for a great many years. 

Senator Montoya. Off the record. 

[Discussion off the record.] 

[A brief recess was taken.] 

Mr. Weitz. Mr. Alagia, could you state for the record your full 
address ? 

TESTIMONY OF DAMIAN PATTL ALAGIA, ACCOMPANIED BY JOHN T. 
MILLER AND JOHN YOUNG BROWN, COUNSEL 

Mr. Alagia. My address is — the office address is 1800 Louisville 
Trust Building, Louisville, Ky. 

Mr. Weitz. "WTiat was your position with Dairymen, Inc., or DI, for 
the record, from September 1968 through March 1971 ? 

Mr. Alagia. The law firm of Brown, Miller, and Alagia at the time 
was employed by Dairymen to render managerial services. The law 
firm permitted me to spend the time necessary to g^i — to coordinate 
this endeavor until such time as they could select a manager, which 
they could not agree upon at the beginning. 

Mr, Weitz. And what was your title? 
( 7059 ) 



7060 

Mr, Ai.AGiA. I was the executive director and the law firm was 
general counsel. 

Mr. Weitz. Am I correct in assuming that DI was formed in Sep- 
tember 1968 ? 

Mr. Alagia. You are. 

Mr. Weitz. And who succeeded you ? 

Mr. At.agia. Ben F. Morgan, Jr. 

Mr. Weitz. Tliat was officially on April 1 , 1971 ? 

Mr. Alagia. Well, he Avas eiiiployed on March 10, 1971. That is the 
day that I look at it, because I didn't have any other — I mean T just 
didn't do anything else to speak of from that time on, because ]\fr. Mor- 
gan came over and had his managerial meetings and set up his 
program. 

Mr. WErrz. When was SPx\CE, the trust for Special Political Agri- 
cultural and Communitv Education, formed? 

Mr. Alagia. March of 1969, as T recall. 

Mr. Weitz. Did you participate or have a role in its formation? 

Mr. Alagia, Tlie formation of SPACE came from our management 
group and farmer members, 

Mr. Weitz, Was there an advisory committee that was formed for 
SPACE? 

Mr, Alagia, The advisory committee was set up after we got a legal 
report as to what we can do and the reporting requirements and 
all that, 

INIr, Weitz, With respect to i-eporting requirements, was it your 
understanding or did you receive legal advice from the outset that 
you or the cooperative and the trust, that all contributions by the trust 
Avould have to be reported under the Corrupt Practices Act? 

INfr, Alagia, T insisted that when we started making expenditures, 
all funds expended would be reported, 

Mr. Weitz. And did you receive advice, legal advice, consistent Avith 
that from some attorney ? 

Mr. Alagia. Yes. 

ISIr. Weitz, Was that DeVicr Pierson ? 

INIr, Alagia, Yes, it was. 

Mr. Weitz. Was Mr. Pierson retained bv Dairvmen, Inc., or bv 
SPACE? 

INfr, Alacjia. Not retained, no. ITe was on a service basis. He bills for 
services rendered. 

Mr. Weitz, Put he was providing vou services as attornev for DI 
and SPACE? 

Mr, Alagia, Yes, we asked him to, 

Mr. Weitz, And since tlie formation of SPACE, has every political 
contribution by SPACE, to your knowledge, been reported, those that 
are reqniied to be reported to the Clerk of the House, been in fact 
reported ? 

Mr. Alagia. To my knowledge, yes, sir, 

Mr, Weitz, And to your knowledge, has every contribution that has 
been made by SPACE been in the form of check or cash? 

Mr, Alagia, Our contributions made by SPACE haA^e all, to my 
knowledge, been in checks, 

INIr. Weitz, And therefore, the re):)orts of SPACE as filed first with 
the Clerk of the House and with GAO Avould be a complete record of 
the contributions bv SPACE : is that correct? 



7061 

Mr. Alagia. Yes ; as far as I -would know. 

Mr. Weitz. Now, in the formation of SPACE, did you consult with 
or receive advice or consultation from representatives of other coop- 
eratives, other dairy cooperatives ? 

INIr. Alagia. We'll, I am sure Ave did, as well as from the National 
Council of Cooperatives. 

Mr. Weitz. I believe INIr. Nelson and Mr. Parr of Associated Milk 
Producers, Inc., have testified that they both felt that they, particularly 
Mr. Parr, were very helpful and perhaps instrumental in the forma- 
tion of Dairymen, Inc., and of SPACE. Would that be a fair 
characterization? 

Mr. Aeagia. There is no question that in April of 1968, Parr, at a 
speech he made in Richmond, Va., at the Southeastern Dairy Con- 
ference, had an effect on the farmers in the audience there about getting 
tofjether. They had been tryin<? to — farmers have been trying to get 
together for years, but they could not get together for a number of 
reasons — managers, boards, identity, and so on. 

Mr. Weitz. A^lio had practical responsibility as opposed to — who, in 
practice, made the decisions for contributions by SPACE? 

Mr. Alagia. Well, during the period that I was there, I made some, 
Mv. >\roser made some, the farmers, you know, would make some, and 
]Mr. Morgan, you know, might make some. 

INIr. Weitz. There was input from a number of sources? 

iNIr. Alagia. Sure. 

Mr. Weitz. Do you have any knowledge of any contributions to any 
or deliveries of moneys to any representative of the President in 1969 ? 

Mr. Alagia. No, sir ; I do not. 

Mr. Weitz. I should qualify tliat — by the dairy people. 

IVfr. Alagia. Wait a minute, now. I did read the newspaper. 

IVIr. Weitz. Yes; other than what you read in the newspaper? 

JNIr. Alagia. No ; I did not. 

INIr. Weitz. At the time or subsequent to that time, other than what 
you read in the newspaper or heard from public sources? 

Mr. Alagia. No, sir ; I did not. 

]Mr. "Weitz. Did anyone in 1969 from Associated Milk Producers ever 
ask for participation bv Dairymen, Inc., and SPACE for contributions 
t'> the President? 

jNIr. Alagia. Not to my knowledge. We didn't spend any money in 
1969. We just collected funds. 

Mv. Weitz. In fact, contributions were not until 1970 by SPACE? 

Mr. Alagia. The first contribution we made was $5,000 or so to the 
Democratic Committee. 

Mr. Weitz. That had nothing to do with Presidential contributions? 

Mv. Alagia. I don't know what they did with the money. 

Mv. Weitz. But it was in 1970, far in advance of any Presidential 
cam])aign, to your knowledge? 

Mr. Alagia. I don't know. Some people think the campaign starts 
after the election. 

Mr. Weitz. In addition to Mr. Pierson, who you said was an attorney 
who did some work for your group, was Mr. Harrison, of the law firm 
of Reeves & Harrison — was he or his firm ever — did they ever per- 
form any services for you ? 



7062 

Mr. Alagia. Mr. Harrison — I met Mr. Harrison the first time, as I 
recall, and I mean I realize I could be wrong, but I didn't meet liim 
until Marcli 21 — not 21 — 23, whenever the President's meeting was, 
1971. 

Mr. Weitz. Do you know when tlie firm of "Reeves & Harrison was 
first retained by Central America Cooperative Federation— CACF? 

Mr. Alagia. I am not sure, but it would liave to be — the records 
ought to show that. 

Mr. Wettz. Let me ask you, was it subsequent to the time that you 
met ]Mr. Harrison in ]\Iarch 1971 ? 

Mr. Aeagia. Yes, to my knowledge, that would be right, because 
CACF — ^Central America Cooperative Federation — was not formed 
until, didn't have their organizatiojial meeting until March 25, 1971. 

Mr. Weitz. I see. Did Jake Jacobsen perform any services for your 
co-op at any time ? 

Mr. Alagia. Well, I remember Jack Jacobsen — I understand he was 
the administrative assistant to President Jolmson — did come around 
wlien we were setting up SPACE in 1969 or 1970 and talked to the 
space; advisory committee, and he talked to different personnel. That 
would be tlie only tiling that I would know that he had done for us, you 
know, when I was there. 

INIr. Weitz. Do vou know when AMPI and its political action trust, 
TxVPE, was formed ? 

Mr. Alagia. 1 was under the impression, until I got reading some 
of this stuff, that it had already been formed prior to our SPACE, 
which was March 1969. But formally, I understand, it was sometime 
in 1969— the early part of 1969. 

Mr. Weitz. It was approximatelv the same time as vour organiza- 
tion? 

Mr. Ai^vgia. That is my understanding now, but that was not my 
impression all along. 

^Ir. Weitz. And Mid-America — do you know when that was 
formed — Mid-America Dairy ? 

Mr. Ai^vGiA. Mid-America'ADEPT. they call it— I don't know what 
ADEPT stands for, but it was formed, my understandino: is, either 
the middle of 1970 or September of 1970, something like that. 

Mr. Weitz. Approximately sometime a year or so after the forma- 
tion of your cooperative and its trust ? 

Mr. Alagia. I think it is a little more than that. 

Mr. Weitz. A little more than a year. 

Mr. Alagia. But that is something that the records would show. 

Mr. Weitz. Now. directing your attention to 1971. did representa- 
tives of your co-op participate in an eft'ort to obtain a price support 
increase for milk for the 1971-72 marketing year ? 

Mr. Alagia. That responsibility was delegated to ]Mr. Joseph West- 
water, and they conducted letter writing campaigns and they went to 
see Congressmen and Senators with the farmers. 

Mr. Weitz. That was in an effort to obtain an increase in price 
supports. 

INIr. Alagia. The effort was to lay your case out before the 

Mr. Weitz. Were there any contacts or- meetings that you were 
aware of. eithei- by Mr. Westwutcr and other emi)loyees of your co- 
operatives or the other dairy cooperatives, with representatives of the 



7063 

administration — the Secretary of Acrriculture, others at the Depart- 
ment of Ao;riciiltnre. or the White House ? 

Mr. Ai^\GiA. I am sure with the Secretary of Agriculture — that 
Department. 

Mr. Weitz. Did you meet with any of those individuals or officials? 

Mr. Alagia. I could have; I could have. I would not say that I 
didn't. But I don't think I met with Secretary Hardin on tlie support 
price. But if somebody has something to refresh my memory on that, 
fine. But I know my people did. 

Mr. Weitz. Now, were vou aware of anvone contacting anvone in 
the White House? 

Mr. Alagia. Was I aware of anyone contacting anyone in the "WHiite 
House ? 

Mr. Weitz. On the price support matter, yes; other than perhaps 
Congress. I am talking about people from your cooperative or the 
other cooperatives ? 

Mr. Au\GiA. Again, I mean, that could have happened, but I am not 
aware of that at this point. 

Mr. WErrz. You attended a meeting with tlie President and the vari- 
ous dairy leaders on the morning of March 23, 1971, did you not? 

Mr. Al.\.gia. I was there. 

Mr. Weitz. When did you first learn of preparations for that meet- 
ing, arrangements that were being made for that meeting. 

Mr. Alagia. You say preparations. I learned sometime in Decem- 
ber or January, I don't remember the exact date — it could even have 
been February — from Harold Nelson that this meeting was going to 
take place, an industry meeting. I didn't associate it at the time with 
the support price. 

Mr. Weitz. When were you first informed of the particular date 
and time of the meeting? 

Mr. Ai^VGiA. It was not too much in advance of the meeting. I mean 
I just don't remember the exact time. 

Mr. Weitz. Were there a number of others from your cooperative 
in attendance? 

Mr. Alagia. Xo, just John Moser and myself. 

]\Ir. Weitz. He was president of the cooperative ? 

Mr, Alagia. John Moser was president of Dairymen, Inc., and 
still is. 

Mr. Weitz. Who told you of the meeting, whenever you did learn 
of it — the specific time and arrangements ? 

Mr. Alagia. Oh, I knew the day of the meeting before I knew the 
exact time. It came to my office or somebody at AMPI had called and 
told us. 

Mr. Weitz. Was it either Mr. Nelson or Mr. Parr, do you recall ? 

Mr. Ai^vGiA. I don't think it was Mr. Parr. It could have been, but 
I don't think so. We didn't know exactly where to go until the morn- 
ing of the 2.3d, when ]VIr. Westwater advised Mr. Moser and I, you 
know, where we were going to meet. 

Mr. Weitz. Now, you first gathered before the meeting with the 
President at Mr. Harrison's office, is that not correct ? 

Mr. Alagia. That is right. 

Mr. Weitz. And at that meeting. Tliat was the first time you met 
Mr. Harrison? 



7064 

Mr. Alagia. To my knowledge. I mean, if I had met liim before— I 
could have, but I don' recall. 

Mr. Weitz. Do you know who Pat Hillmgs is ? 

Mr. Alagia. No sir, I don't. 

Mr. Weitz. You don't recall meeting him that day ? 

Mr, Alagia. No, I do not. 

Mr. Weitz. You don't recall meeting him with the President that 
day? 

Mr. Al.\gia. I would not know Pat Hillings if he stumbled into me. 
He could have been there. 

Mr. Weitz. Do you Icnow Murray Chotiner ? 

Mr. Alagia. I have met Murray Chotiner. 

Mr. Weitz. Did you know him before the meeting on the 23d with 
the President ? 

Mr. Alagia. No, sir, I did not. 

Mr. Weitz. Did you meet him on that day ? 

Mr. Alagia. I don't recall meeting him on that day. 

Mr. Weitz. Jut to finish that off, you met him subsequently, then, to 
the 23d. 

Mr. Alagia. I met him later on. 

Mr. Weitz. Shortly after, or weeks or months later ? 

Mr. Alagia. No, I will tell you exactly when it was. 

My recollection is that when Attorney General Kleindienst was being 
confirmed up here before the Senate Judiciary Committee that — I was 
in Marion Harrison's office and I had asked him, you know, Mr. 
Chotiner got to be — well, he is a curiosity and I thought, if he is here, 
I would like to meet him. 

Mr. Weitz. So you met him then ? That was in 1 972 ? 

Mr. Alagia. That was whenever those confirmation hearings were. 
He commented about Richard the lionhearted and that is why I remem- 
ber that meeting. 

Mr. Weitz. Before your meeting with the President, or by the time 
of the meeting with the President, were you aware of any contacts that 
were being made on behalf of any various dairy groups, such as on 
behalf of AMPI, with people in the White House, by either Mr. 
Chotiner or others ? 

Mr. Alagia. I didn't even know Mr. Chotiner — I mean I didn't even 
know who he was. 

Mr. Weitz. You did not know he was of counsel to the Reeves and 
Harrison firm at that time? 

Mr. Alagia. I mean if I did, I didn't pay any attention to it, because 
I didn't know who he was. If they were making contacts, I mean they 
could have been making contacts and I would not necessarily know 
about it, you know. 

Mr. Weitz. Did you meet at all or regularly with any of the repre- 
sentatives of the other two co-ops in Washington at that time in 1971? 

Mr. Alagia. Did I ? 

Mr. Weitz. Yes. 

Mr. Alagia. In March of 1971, I remember meeting with a Pat 
Healey, who is secretary of the National Milk Producers Federation, 
with Fred Letford, who is from my office. Fred reminded me of this, 
and these farmers were all up here, you know, from all over. I could 
have met Avith, you know, these other fellows. I assume I could have. 



7065 

Mr. Weitz. Let nie ask you, at the meetiiio; with the President, in a 
court pleading filed in the Nader suit, of which I am sure you are 
aware, filed on January 10, 197-i, plaintiffs — counsel for plaintiffs in 
the suit include in their pleading a portion of the transcription of the 
tape of that meeting — tape recording of the meeting with the 
President. 

Mr. Alagia. Is that the one Mr. Dobrovir played at the cocktail 
party ? 

Mr. Weitz. Perhaps. 

The fii-st sentence of the President's opening remarks goes as fol- 
lows, according to this representation : "I first want to say that I am 
very grateful for the support we have [inaudible word] from this 
group." 

I telieve in all fairness, the White House has said that inaudible 
word should be "we have had in this administration.'' 

Whether that is the correct insertion or not, do you recall the Presi- 
dent making such remarks at the outset of the meeting or at any time 
during the meeting ? 

Mr. Alagia. The President could have made those remarks and — I 
mean whatever, if the tape is OK, I certainly don't see any problem 
with that. 

Mr. Weitz. It is not inconsistent with any recollection you have of it? 

Mr. Alagia. No, sir. 

Mr. Weitz. Let me ask you this question : Do you have any idea 
what support the President would be referring to? Well, let me ask 
that question, first — what support he would be referring to or he was 
referring to ? 

Mr. Alagia. Well, I thought he was — I mean I didn't associate it with 
contributions, which is what everybody is trying to make out of this 
thing. In my own mind, he was just thanking them for support that 
they had given him, I guess, in voting in the Midwest. I don't remember 
how the Midwest States went in 1968. 

Mr. Weitz. Well, would that be voting for this administration since 
the time he had been elected, or would that in fact have been different? 

Mr. Alagia. Well, you know, I certainly didn't associate it with 
contributions. 

Mr. Weitz. You hadn't discussed, in fact, up to that point, contribu- 
tions to the President with anybody ? 

Mr. Alagia. No, sir. 

Mr. Weitz. You are aware whether others have or have not ? 

Mr. Alagia. I am not. 

Mr. Weitz. Outside of your co-op. 

Mr. Al.\gia. That is right. 

Mr. Weitz. On March 23, 11 days had passed since the Secretary 
of Agriculture's decision not to increase price supports is that cor- 
rect? 

Mr. Alagia. Right 

Mr. Weitz. You said John INIoser had been active on behalf of your 
co-op, Pat Healy and others, perhaps, on the Hill to get legislation. 
Would that legislation be an attempt essentially to get an increase 
which had not been fortlicoming from the Secretary's decision, is 
that correct ? 



7066 

Mr. Alagia. Well, let me answer your question this way rather than 
to say that is correct. The market price at the time was approximately 
$4.86 a hundredweight. The record will show exactly what it was. The 
85 percent of parity was about $4.92. Today— well, I don't want to 
come into that. 

The bills that were in Congress would luive put a floor during the 
season when milk generally is plentiful from it going below the sup- 
port price. But in this case, the market price always stayed right 
around, and of course, next year, when they did not raise the support 
price, tlie market price just soared away from the support price to 
where it is today, better than $2 a hundred. 

Mr. Weitz. My question is this — 

Mr. Plotkin. If I am correct, I believe you said $4.86 per hundred- 
weight when you were referring to parity. Did you mean $4.66? 

Mr. Alagia. No; no; parity and the $4.66 are different animals. 

The $4.66 was a floor beneath which the farmer's price for milk 
that went into butter, powder, and cheese, or the milk-equivalent 
basis, would not go below. 

Mr. Weitz. According to the March 12 decision. I don't want to 
quibble. I think you are right. 

Mr. Alagia. Right. What I am saving is the March 12 decision said 
the support price is $4.66 on a milk-equivalent basis. We can talk 
about what that means in butter, powder, cheese. But on a milk-equiv- 
alent basis at the same time we were meeting with the President, 
it was right ai-ound $4.86 or $4.88. So in efl'ect, w^hat I am saying is 
they didn't give the American farmer anything to speak of. 

Mr. Weitz. Let me ask you this: Witliout regard to wliether or not 
the bills that you were advocating were of any benefit tothe farmer 

Mr. Alagia. They were of benefit, because they would establish a 
floor below which 

Mr. Weitz. Right, which was liigher than the existing market 
price at the time, is that correct? 

Mr. Alagia. At that time, the market price was about $4.86 or $4.88 
and the 85 percent of parity was about $4.92. 

Mr. Weitz. And most of the bills provided for a floor of 85 percent 
of parity? 

Mr. Alagia. Between 85 and 90 percent. 

Mr. Weitz. Right, a minimum of 85 percent. My question is this: 
With bills being presented on the floor, of which you and your groups 
were advocates and supporters — 

Mr. Alagia. Sure. 

Mr. Weitz. And in fact, those bills being largely supported by Dem- 
ocrats, as the record shows, and not by Republicans, do you believe 
at that point that you were in the posture of beino- supporters of the 
administration and the President? Was that consistent — was that 
a logical statement for the President to make at that time, when, for 
the last 11 davs, there had been a lot of activity on tlie Hill to get 
bills that would set a minimum jirice above the Secretary of Affri- 
culture's stated minimum? Does that make sense to you — that in 
fact, on March 23, you were acting as friendly supporters of the 
administration? 

Mr. Alagia. Let me put it this way — you mean we were acting as 
friendly supporters of the administration? 



7067 

Mr. Weitz. The dairy cooperatives, the leaders who were at the 
meeting. 

Mr. Alagia. You don't go around and kick the man that is in 
power. I mean the fact that he was — I mean the administration — it 
is obvious to me that the Republicans would have to have some sup- 
port in the farm belt. I mean that is just — Democi-ats need support 
in the farm belt, and in the South. I just don't associate the fact that 
he says, "I welcome you here and thank you for support," or whatever 
he said — you mean I just can't say what you want me to say. 

Mr. Weitz. All right. I just want you to say what you want you 
to say. 

Mr. Weitz. All right. I just want you to say what you want to say. 
what the facts are not. 

Mr. Weitz. So you didn't associate it as contributions, just asso- 
ciated it as a friendly remark. 

Mr. Alagia. That is right. 

Mr. Weitz. Were Under Secretary Campbell and Secretary Hardin 
at the meeting with the President ? 

Mr. Alagia. Yes, sir. 

Mr. Weitz. What was the position taken by Secretary Hardin? 

Mr. Alagia. You know, everybody looks at the same picture and 
we see different things. T did not feel that Secretary Hardin had a 
closed mind. 

Mr. Weitz. What about Under Secretary Campbell ? 

Mr. Alagia. Under Secretary Campbell — in my judgment, I have 
known the Under Secretary for several years now and my judgment is 
that lie is going to support his boss, although his feelings would be for 
the dairy farmer. If he was concerned about surpluses, he knows that 
dairy farmers can put in base plans, and have, you know. 

Mr. Weitz. Now, in the disposition given by John Moser in the case 
of Nader v. Buti. on November 16, 1972, at pages 8 and 10, in response 
to a request as to what the position — question as to what the positions 
of the Secretary and the Under Secretary were at the meeting, reciting 
Avhat took place at the meeting, j\Ir. ISIoser says: "The Secretary of 
Agriculture was very much opposed, I would say, toward a price in- 
ci-ease and the Assistant Secretary, Mr. Campbell, was violently op- 
posed to it." 

Is that consistent with youi" recollection ? 

Mr. Alagia. I didn't — you know, I didn't read it that way. I didn't 
read that Secretary Hardin was violently opposed to the support, price 
increase. 

Mr. Weitz. Now, at the conclusion of the meeting, did you have oc- 
casion to leave and thereafter discuss the meeting with Mr. Moser? 

Mr. Alagia. Yes. 

Mr. Weitz. "\^^lat was your general asscvssment of the meeting as you 
communicated with Mr. Moser ? 

Mr. Alagia. Well, of course, you never know. It was a nice meeting 
and the President took time, and frankly, I was impressed, whether 
correctly or not, that he took time to answer every one of those farm- 
ers in the room what they thought of the problem. 

Mr. Weitz. A^liat was Mr. Moser's assessment — I am sorry, go ahead. 

Mr. Alagia. I mean I don't recall exactly w^hat John said, except I 
am sure it liad something to do M'ith the cost-price squeeze the farmer 



7068 

was in. Everything— the inflation was high and wages going up and 
everything, and here tlie farmer is talking about what would amount 
to a very small increase and he does not even get that. 

But in any event, I mean we may not have read every detail of the 
picture the same way. 

Mr. Weitz. I see. 

Now, at lunch on the 23d, I believe you were joined briefly for a 
short time by Mr. Campbell ? 

Mr. Alj\gia. Mr. Campbell joined Rudolph Clark and Gene Marx, 
who are farmers of Georgia that he has known for years, and Mr. 
Moser and I joined them for lunch. 

Mr. Weitz. At that meeting — he had been, of course, at the meet- 
ing shortly before with the President. Did you discuss the price sup- 
port question or the meeting itself ? 

Mr. Alagia. Oh, I think they obviously had something to say about 
the meeting. 

Mr. Weitz. What about the price support matter, the underlying 
issue ? 

Mr, Alagia. I don't — I mean it is logical that something was said, 
but I can't nail down exactly what was said. Rut I didn't come away 
with the feeling that he was telling those fanners from Georgia that 
he didn't care whether the support price went up or down. 

Mr. Weitz. Did Mr. Campbell indicate that he would be meeting 
with the President that af teiTioon and other advisers ? 

Mr. Ai^VGiA. No, he didn't. If he did, he didn't tell me — didn't 
confide in me. 

Mr. Weitz. Did he indicate in any way that a reconsideration of the 
matter was underway or that otherwise there might be a reversal in 
the decision by the Secretary of Agriculture ? 

Mr. Ai^vGiA. No, I mean I don't recall anything like that. 

Mr. Weitz. Did you have occasion before you left Washington on 
on the 23d to discuss either the meeting or the underlying matter of 
price supports with any representatives of the other two dairy co-ops? 

Mr. Alagia. I didn't see the representatives of the other two dairy 
co-ops except probably George Mehren, M-e-h-r-e-n. He just moved to 
San Antonio or something and was telling me something about a new 
automobile that he had. But we didn't discuss that. 

Mr. Weitz. Now, you left WavShington the afternoon of the 23d ? 

Mr. Alagia. Yes, sir. 

Mr. Weitz. Before you left, until that time, had you ever discussed 
with representatives of the othei- co-ops possible contributions to the 
Pi-esident for his reelection or for whatever other purpose? 

Mr. Alagia. You mean that day ? 

Mr. Weitz. No, any time previous to that or up to the time you 
left Washington. 

Mr. Alagia. Any time previous to that? You know, I could have, 
but I sure don't remember. And if somelx)dy has something that, if I 
have some other memory on that, 3'ou know, let me see it, because I 
don't recall. It is possible, but I don't recall. 

Mr. Weitz. And you have no recollection of any conversations or 
discussions with any representatives of the other two co-ops up to the 
time of the 23d or up to the time you left Washington on the 23d 



7069 

of any commitments or goals or large, substantial contributions to the 
President or to the administration ? 

Mr. Alagia. No, sir. Absolutely not. 

Mr. AVeitz. Were you aware of any commitments that had been 
made by representatives of AMPI to the administration? 

Mr. Ai.AGiA. No, sir, I sure was not. 

Mr. Weitz. Were you aware that prior to the 23d, representatives of 
AMPI had met with people in the White House ? 

Mr. Alagia. Was I aware? 

Mr. Weitz. Yes. 

Mr. Alagia. No, I was not ; but I read so much in the newspapers ; 
apparently, tlie}^ did. 

Mr. Weitz. But your knowledge — at the time you had no knowl- 
edge of any contacts or any subsequent discussions they might have 
had with representatives of the White House? 

Mr. Alagia. No. I didn't live with those fellows, you know. 

Mr. Weitz. Now, the afternoon of the 23d, did you fly to Chicago 
from Washington ? 

jNIr. Alagia. I did. 

Mr. Weitz. And you had a meeting there on the afternoon and 
evening of the 23d that was unrelated to the dairy question — ^to the 
price-support question. 

]Mr. Alagia. I met a group, an insurance man at an insurance in- 
dustry meeting that wanted me to meet some other people in connec- 
tion with the possibility of filing a civil suit. 

jVfr. Weitz. Now, at the time you left Washington on the 23d, was 
there at that time planned a meeting on the 25th, 2 days later, to 
organize and form Central America Cooperative Federation — CACF? 

Mr. Alagia. That had been scheduled. We had scheduled that one 
time in February and AMPI didn't show up and now it was rescheduled 
for March 25. 

Now, I want to sa}^ this : Before we left Washington, John Moser 
and I discussed — you know, when we got in the cab and went to the 
Quality Court, he and I discussed whether or not, you know, the meet- 
ing. 

Mr. Weitz. The meeting with the President? 

Mr. Alagia. The meeting with the President, and we should con- 
centrate our eiforts on the Hill, where these bills were going through 
Congress. And we talked about contributions to Eepublican commit- 
tees in hopes that some of the Republicans that didn't sponsor the bills 
would perhaps again look at it and give us an attentive ear. 

And I told him that since I was a lame duck and on my way out, 
back practicing law, really full-time, now, I would appreciate it and 
would take it up with Ben Morgan and it would be his decision and 
Mr. Moser's, and if they had any questions about it, I mean that would 
be it. 

Mr. Weitz. Did you decide before you left Washington on any 
specific contribution or amounts of contribution that would be made? 
For the purpose you have described ? 

Mr. Alagia. Well, we knew we had the dinner tickets. 

Mr. Weitz. Well, let's back up, then. 

The following night, you were aware of a Republican fundraising 
dinner that was to be held ? 



7070 

Mr. Alagia. Tt was either the following night or the morning- we 
went over to the White House. 

Mr. Weitz. But the dinner itself was to be held on the 24th and yon 
knew about it? 

Mr. Alagia. The Senate campaign dinner. 

Mr. Weitz. Who had told you al)out that dinner ? 

Mr. Alagia. These farmers. 

Mr. Weitz. On the other side, had fundraisers 

Mr. Alagia. Republican and Democratic fundraisers contacted me 
all the time. 

Mr. Weitz. Who were the Republican fundraisers that contacted 
you about that dinner? Did you talk about the dinner with Mr. 
Harrison ? 

INIr. Alagia. I went and asked Mr. Harrison at the White House, 
"AMiere can I go and get dinner tickets for this Senate campaign 
dinner tomorrow night?"' 

Mr. Weitz. Right. Had he talked to you about it previously? 

Mr-. Alagia. I don't recall. 

Mr. Weitz. Why did you go to Mr. Harrison ? 

Mi-. Alagia. I thought anybody who could take us into the AAHiite 
House ought to be able to tell us where to find Republican dinner 
tickets. 

Mr. Weitz. Do you recall any Republican solicitors who had ap- 
proached you prior to the time you talked to jNIr. Harrison about it, 
for this particular dinner ? 

Mr. Ai^agta. I don't specifically recall. 

Mr. Weitz. Had you ever purchased any Republican fundraising 
dinner tickets through Mv. Harrison prior to this occasion ? 

jMr. Alagia. No, sir, not to my knowledge. 

Mr. Weitz. Had he ever asked you to purchase any such tickets or 
make any Republican contributions before this time ? 

Mr. Alagia. No ; I just met INIarion Harrison. 

Mr. Weitz. Was he introduced to you in some way as a Republican 
lawyer or Repu})lican law firm ? 

Mr. Alagia. Well, T assumed that it Avas a Republican law firm, be- 
cause we met there and he took our identification to walk across the 
street and get into the AA^iite House. 

Mr. Weitz. Before you left Washington, did you tell Mr. Harrison 
of the amount of tickets or the amount of contributions you would 

Mr. Alagia. A table. You know, if a table is 10, and that is my un- 
derstanding, that is 

Mr. Weitz. It would be 10 tickets. 

Mr. Alagia. That is right. 

Mr. Weitz. And vour understanding also was that it was $1,000 a 
plate? 

Mr. Alagia. Yes, that is my recollection. Now, I am not infallible 
by a long shot. 

Mr. Weitz. I think that is consistent with the record. 

So before you left Washington, you had infoi-med Mr. Harrison that 
it was your intention to purchase 10 tickets and make a $10,000 con- 
tribution subject to review by Mr. Morgan. 

Mr. Alagia. I didn't say anything about subject to review by Mr. 
Morgan on the 10 tickets. 



7071 

He said he would have them there in his office the next day by noon 
and I could pick them up there then and that was fine. 

Mr. Weitz. Did you attend the dinner ? 

Mr. Alagia. No, sir; my practice has been that I didn't attend any 
of these things, but when it came time to go to the White House, I 
thought that would be a very fine opportunity, because I don't get to see 
the President very often. 

Mr. Weitz. So you left Washington on the afternoon of the 23d 
with the Iviiowledge that approximately 10 tickets would be purchased 
for the following night's dinner but that you would not attend, you 
would not return to Washington for that dinner. 

Mr. AivAGiA. A table, that is right. 

Mr. Weitz. Approximately 10 tickets or 10 seats. 

Mr. Alagia. You know, whatever is in the table. I don't remember 
whether it is 5 or 10. You can probably tell me. Ten is what I have 
in the back of my head. 

Mr. Weitz. Now, when you were in Chicago, after you had left 
Washington at that meeting, were you informed that representatives 
of AMPI were trying to reach you, either directly or indirectly ? 

Mr. Alagia. Yes, sir. 

Mr. Weitz. Could you tell us how you came to know that ? 

Mr. Alagia. Well, when I got to Chicago, I called my wife sometime 
during the course of the evening. She told me that these fellows from 
AMPI were looking for me. And I didn't know what. She either gave 
me a number, you know, or — you know, I called her back to tell her — 
it was eithei that time, it was one of those calls she told me they were 
looking for me. And she either told them the time I was coming in, 
because T had told her, and I had not planned to stay overnight in 
Chicago. I had this matter at Harrisonburg in southern Illinois 

Mr. Weitz. For the next day ? 

Mr. Alagia. For the next day. A plant was in trouble and I was 
concerned about making sure the legal papers were all fixed up on that. 

She either told them what time I was coming in or else she gave me 
a number to call and then I was infoi-med that they wanted to meet 
me. But I can't remember — I know I didn't talk with Nelson, Parr, 
Lilly, or Hanman. I mean I don't recall them talking to me. 

Mr. Weitz. While you were in Chicago ? 

Mr. Al \gia. Right. 

Mr. Weitz. But were you informed that those were the people who 
were trying to look for you ? 

Mr. Alagia. Oh, no. No. I didn't know who was going to be at the 
airport when I got off until I got off the airplane. 

Mr. Weitz. Did you know someone would be trying to meet you or 
wait for you ? 

Mr. Alagia. I was told that. "Whether or not they would be there, I 
was going home. 

Mr. Weitz. But your wife told you they would try to meet you at 
the airport? 

Mr. Alagia. When I got home, yes. 

Mr. Wettz. What is your best recollection of the time you arrived in 
the airport in Louisville that morning? 

Mr. Alagia. Three or four o'clock. 

Mr. Weitz. Who did you find at the airport waiting for you ? 



7072 

Mr. Alagia. I found Harold Nelson, Dave Parr, Gary Hanman, 
and Bob Lilly. If they had anybody else there, I don't remember. 

Mr. Weitz. And Mr. Lilly, Mr. Nelson, and Mr. Parr were employed 
by AMPI, and Mr. Hanman was employed by Mid-America 
Dairymen ? 

Mr. Alagia. Yes, sir. 

Mr. Weitz. Who spoke to you when you came off the plane ? 

Mr. Alagia. I don't know which one of them spoke to me, but I 
know my — you know 

Mr. Weitz. Who did most of the talking to you ? 

Mr. Alagia. Mr. Parr. 

Mr, Weitz. Do you recall anything in particular — could you tell 
us essentially what he told you ? 

Mr. i^LAGLA.. When I got off the plane — you know. I can tell you the 
thrust of the meeting. I can't remember it word for word, but I can 
tell you what the thiiist was as far as these four fellows descending on 
me at that time. That was, you know, I could not imagine why they 
were down there to meet me at that time. But in the past, I mean, they 
were night people from the word go as far as meetings and things like 
that were concerned. 

In any event, I asked them to^ — you know, what on earth did they 
want? 

They said, well, they indicated to me thev wanted $200,000 or 
$300,000 from us. 

I said, well you, or words to this effect, you have got to be kidding. I 
mean we would not have that kind of money. What are you guys talk- 
ing about ? You have to be kidding. 

So they got off that. 

Mr. Weitz. Before we leave that. They got off that. "\Ylien they 
first made the — would it be Nelson or Parr, essentially, who made 
that requests or statement? 

Mr. Alagia. Yes, but I don't recall which one. 

Mr. Weitz. Did they in any way indicate, either by the context 
of the discussion of anything else you can piece together from your 
understanding at the time, did they indicate what they wanted the 
money for, or for whom? 

Mr. Alagia. Well, it was — let me put it this way. In the context 
of the meeting — and you know, incidentally, I didn't know whether 
this meeting was this day or later on at some other time until we got 
really checking these records. But obviously, in the meeting we had 
had with the President and it was in the context of, you know, that 
meeting. That is about the best I can put it. 

Then they go on to wanting SPACE to lend ADEPT $100,000. 

Mr. Weitz. Now, ADEPT, you indicated, had been formed more 
than a year after SPACE had been formed. Was it your understand- 
ing that thev had even a smaller amount of funds available than did 
SPACE? 

Mr. Alagia. Frankly, I didn't know what ADEPT had in their 
coffers, you know, nor did I know what TAPE had. I just didn't 
keep count of that, you know. 

Mr. Weitz. But it was clear in your mind that they wanted the 
money in order to enable ADEPT to make a contribution with that 
amoimt ? 



7073 

Mr. Alagia. What other conchision could I reach? 

Mr. Weitz. And they said they wanted how much, $100,000? 

Mr. Alagia. $100,000. 

Mr. Weitz. Did they tell you by what time or timetable they 
wanted it? 

Mr. Alagia. I asked them, in effect, what was the timetable. They 
said the first of the week. 

I said, well, "Listen, I am a lame duck, by gosh, and I am sure not 
going to make any decision like that." 

Mr. Weitz. Did you also raise a question as to the legality of that 
loan ? 

]Mr. Alagia. Yes, I did. I said I didn't think that corrupt prac- 
tices law would permit the transfer or loans like that. And I had 
made up my mind I was not going to have any part of that. 

INIr. Weitz. I am sorry if you had stated it before. Did he indicate 
he wanted the loan by the first of the week. Did you — did he indicate 
that to you? 

Mr. Alagia. They indicated — I am just telling you how I remem- 
ber it. The thrust of it was that by the first of the week, the loan from 
SPACE that they wanted for ADEPT 

Mr. Weitz. Right. Now, if the record, which would, of course, be 
a matter of public knowledge, if the record shows that the morning 
of the 24th was a Thursday morning and the first of the following 
week, meaning Monday, was the 29th, then essentially, they were ask- 
ing for this loan by the 29tli of March if that is the way the calendar 
works out for that year. 

Mr. Alagia. Would you run that by me one more time? 

Mr. Weitz. The 24th was a Wednesday morning. I am sorry if I 
said Thursday. Wednesday morning. 

INIr. Alagia. OK. 

Mr. Weitz. If Wednesday was the 24th of March 1971, the fol- 
lowing Monday would be the 29th of March 1971. Just so the record 
is clear, they were asking you for this $100,000 loan by the first of 
the following week, which would be the 29th of March 1971? 

Mr. Alagia. Yes; that is the kind of way I would agree. 

Mr. Weitz. Did you tell them of your decision to have a table 
purchased for that night's dinner on the 24th? 

Mr. Alagia. I don't know whether I did or not. 

Mr. Weitz. Did they mention the dinner at all, by the way, during 
this conversation? 

Mr. Alagia. I am not sure that they mentioned the dinner. They 
had tickets, did they not, to this dinner? 

Mr. Weitz. I believe ultimately they did attend the dinner, yes. 

Mr. Alagia. You know, I have read so darned much stuff now in 
newspapers and trying to reconstruct everything. It could have hap- 
pened, but I don't recall. 

Mr. Weitz. Did they talk about commitments to anyone or for 
any amount for political contributions? 

Mr. Alagia. No; they did not to me. They wanted that $100,000 
from SPACE to ADEPT and that is what statement was made. 

Mr. Weitz. Did you tell them that you would ask Ben Morgan 
about it? 

Mr. Alagia. I told them that any decision on stuff like this is 
not going to come from me. I had made my share of decisions, I am 
a lame duck, and Ben Morgan is the director. 



30-337 O - 74 - Bk. 16 - 10 



7074 

Mr. Weitz. I understand, but just to be precise about it, that 
response could mean one of two things. Eitlier, if you want to make 
the request, ask Ben INIorgan; or it could mean none of us are inter- 
ested. Did you try to convey one or the other response? 

Mr. Alagia. I was trying to leave. I was ti-ying to leave. 

Mr. Weitz. Did they indicate why they hadn't contacted Morgan 
directly, since he was taking over or had taken over at that point? 

]Mr. Alagia. Well, I think this was just a last -minute effort to put 
some pressure on a guy. 

INIr. Weitz. Let me ask you something. Do you know whether — 
did they indicate to you anv amounts that they were prepared — 
"they" meaning TAPE or perhaps ADEPT, but primarily TAPE— 
was prepared to contribute? 

Mr. Alagia. I don't recall any. 

Mr. Weitz. In the executive session held before this committee with 
Harold Nelson on December 19, 1978* at pages 74 and 75, we asked Mr. 
Nelson about this meeting at the airport. I asked Mr. Nelson, "Did he 
agree to make that contribution that you asked for" — Mr. Nelson, by 
the way didn't remember the amount, but he knew they asked for some 
amount. I asked, "Did he agree to make that contribution that IMr. 
Nelson had asked vou fox." Mr. Nelson's response was on page 75 : "He" 
— meaning you, Mr. Alagia — "agreed to see what he could do." 

Is that consistent with your recollection ? 

Mr, Alagia. No, it isn't. Well, I would not consider doing that. I was 
on my way out and I was not going to make any decision at all on any- 
thing like that. 

Mr. Weitz. On page 75, Mr. Nelson says : "I think there was no ques- 
tion about it. they would have been interested in doing it if they had 
the money available." 

Is that consistent with what you told him or Avhat your recollection 
of the meeting was ? 

Mr. Alagia. I was not interested in doing that at all. 

Mr. Weitz. And when I asked Mr. Nelson. "Was he'' — meaning vou 
—"interested in helping you but just wanted to check how much they 
had and would do everything they could?'' Mr. Nelson's response was: 
"In my recollection, he was very interested. There was no problem from 
that standpoint at all." 

And that is inconsistent with your recollection of the meeting? 

Mr. Alagia. Why, ves ; I didn't asfree to that at all. 

Mr. Weitz. How did you leave it? Did you just go to bed and leave 
it that you would not be contributing any amount or no amount ? 

Mr. Alagia. I told them that I was going to leave any decision on 
contributions to Ben Morgan and I didn't think it was legal what they 
were trying to do. I don't know what he says about that, but I sure 
didn't think it was legal. 

Mr. Weitz. When you sav "Avhat they were tryin.<r to do," are you 
talking in terms of the loan from one trust to another? 

Mr. Alagia. Why, sure. Why should we lend ADEPT or anybody 
else the monev? If they don't have the money, they should not be mak- 
ing anv contributions. 

Mr. Weitz. Now, the very next morninsr, the morning of the 24th, 
that same day, did you relate this conversation to Mr. Morgan? 

Mr. Alagia. That next morning, I talked with Ben jNIorgan and I 

*See Book 15, p. 6630. 



7075 

talked about the Presidential meeting. I talked about the meeting with, 
you know, Mr. Moser. 

Mr. Weitz. The discussion ? 

Mr. Alagia. The discussion about the contribution. 

We talked about the fact that we ought to concentrate our efforts on 
the Plill, and we — I am sure we discussed the dinner dates, and as far 
as the meeting at the airj)ort, I told Ben Morgan if he got a call from 
anybody over there, lejiding money from SPACE to ADEPT or any 
of that, I am sure not going to authorize it from a legal point of view. 

Mr. Weitz. Let me ask you one question. I think we may have over- 
looked this from my understanding of the meeting at the airport. Was 
there any reference to Mr. Connally by the AMPI officials ? 

Mr, Alagia. Yes, sir. 

Mr. Weitz. This was at the meeting at the airport ? 

Mr. Alagia. Yes. They told me, you know, they had either been to 
see Connally or they were on their way to see Secretary Connally. 

Mr. Weitz. Who told you that, do you recall ? 

Mr. Alagia. Harold Nelson. I feel it could have been Dave Parr, but 
I think it was Harold Nelson. 

Mr. Weitz. Did Mr. Lilly or Mr. Parr say anything about Mr. Con- 
nally that you can recall ? 

Mr. Alagia. Mr. Lilly — -they were trying to tell me what kind of a 
forceful fellow Mr. Connally was. 

Mr. Weitz. There again, was it your understanding that they were 
referring to the price support matter then possibly before the admin- 
istration? 

Mr. Alagia. Well, it was in the context of this meeting. 

Mr. Weitz. Was anything else said that you can recall at this meet- 
ing at the airport at 4 in the morning? 

Mr. Alagia. No; I was ready to leave, you know, and would have 
done anything within limits to politely excuse myself and get out of 
there. I didn't appreciate them descending on me, you know. 

Mr. Weitz. Let me ask you one more question. Had you been aware 
before their comment to you about Mr. Connally that they had been in 
contact with Mr. Connallv or were trying to get in contact with Mr. 
Connally? 

iNIr. Alagia. Had T been aware? 

Mr. Weitz. Yes, before they told you. 

Mr. Alagia. I mean if they did tell me, it didn't make much of an 
impression, because they were always talking about big names. And 
I say big names ; you know, they had either been down to see President 
Johnson at his ranch or some other place. 

Mr. Weitz. But this was the only big name that they mentioned 
to vou at the airport meeting? 

Mr. Alagia. Yes, sir, as far as I can recall. 

Mr, Weitz, Now, on the 24th, after you had talked to Mr. Morgan, 
do you in fact know what steps were taken to make a contribution that 
dav to the dinner, to the f undraising dinner on the 24th ? 

Mr. Alagia. Yes. When T could not find Joe Westwater and my wife 
reminded me that she tried to get Lou Westwater. his wife, to call me 
during the course of the morning if she ran him down, T sent John 
Mays to Washington to get tlie dimier tickets from Harrison's office 
to take them to the Quality Court — — 



7076 

Mr. Weitz. In Washington ? 

Mr. AtvAgia. "Wliere oiir dairymen -\\ ere — so our dairymen, the Pres- 
ident and these other farmers, would not be floundering around, won- 
dering wliere the dinner was, or anything like that. 

Mr. Weitz. I think the record shows that five checks, each for $5,000, 
to various Republican committees, totaling $25,000. were drawn for 
SPACE on the 24th of March. Can you tell us who authorized those 
contributions? 

Mr. Alagia. After talking with Mr. Morgan, he called me back, 
talking about how much was in our kitty, and $20,000 or $25,000 
is wliat he authorized Jim Mueller to write. 

Mr. Weitz. Do you know whether that contribution on the 24th, 
totaling $25,000. was the largest amount to any one function or fund- 
raising event that SPACE had made up to that time ? 

Mr. Alagia. It could have been, it could have been. 

Mr. Weitz. Do you know whether any representatives of your 
co-op or employee of your co-op talked Avith any representatives of 
AMPI or Mid-America on the 24th, after the meeting that you had at 
the airport? 

iNIr. Alagia. Do I know ? 

INIr. Weitz. Yes. 

Ml'. Alagia. No. not of my own knowledge. 

Mr. Weitz. Did anyone ever tell you that they did on the 24th 
talk again that day or that evening with any of the other people from 
the two co-ops? 

Mr. Alagia. I don't, you know, now recall any such conversation, 
you know, reported to me. There could have been, but I don't recall. 

]\rr. Weitz. '\Anien was the next time that you in fact met with Mr. 
Nelson and some of the other members of AMPI ? 

INIr. Ai^\GiA. Well, the next day in Chicago 

]\rr. Weitz. On the 25th. 

INfr. Alagia. On the 25th, we had the farmers that were to serve on 
the first board of directors of Central America Cooperative Federa- 
tion meeting, you know, to have their organizational meeting. 

IVfr. Weitz. At that time — INIr. Nelson was there and vou were 
thei^e ? 

Mr. Alagia. T don't remember INIr. Nelson being there. 

Mr. Weitz. Who was there from AIMPI ? 

Let me ask you this: Were either Mr. Parr or INIr. Lillv there? 

Mr. Alagia. Mr. Parr was there, but I don't remember Mr. Lilly. 

Mr. Weitz. Was Mr. Hanman there ? 

Mr. Alagia. ]Mr. Hanman was there. And their president and 
officers. 

Mr. Weitz. Of course others were there. What I want to get to is 
did either Mr. Parr or Mr. Hanman mention in any way or discuss 
again or refer in any way to the matters that they had raised with 
you at the airport meeting on the morning of the 24th ? 

Mr. Alagia. No, but when we were up there in Chicago, word had 
come in the room there that the support pi-ice had been changed. 

Mr. Weitz. Of course, you were quite ]>leased, as were the others? 

Mr. Alagia. Well, I was surprised, to be honest with you. 

Mr. Weitz. Did Mi*. Parr indicate, either before that was an- 
nounced or at the time it was announced or thereafter, that he knew 
it was in fact going to be increased ? 



7077 

Mr. Alagia. Of course, he had been talking about the support price, 
I think, at one of our meetings at the Marriott in February, when 
dairymen and AMPI were talking about merger and we had Mid- 
America people over there. You know, they were trying to organize 
Central America Cooperative at that time. I am sure there was dis- 
cussion about the support price. 

Mr. Weitz. Not merely discussion. Did he in any way indicate on 
the 25th at this meeting, either before the announcement that the in- 
crease had been made or granted or after you received the news, that 
he had prior knowledge or in some Avay knew from certain knowledge 
that it was going to be raised as opposed to just mere speculation ? 

Mr. Ai^GiA. When I got to Chicago and waited around there — 
you know, they kept us waiting for a little while — the announcement 
came in that the support price had been increased. I mean I don't 
have any recollection of him or anybody else telling me that it is a shoo- 
in or something like that, if that is what you are asking me. 

Mr. "Weitz. Right. 

Mr. Alagia. If they did, I would have thought that was just brag- 
ging. 

Mr. Weitz. After the 24th, when you had the meeting at the air- 
port, when they accosted you at the airport, subsequent to that time, 
did you have further discussions with any representatives of AMPI 
or ^lid-America co-ops about contributions for the President or to 
the Republicans ? 

Mr. Alagia. With me ? 

Mr. Weitz. Yes. 

Mr. Alagia. After that time, I didn't participate in the day-to-day 
decisions that anybody might make with respect to SPACE. It seems 
like on these $2,500 committees, these dummy committees in 
August 

Mr. Weitz. Yes, August 1971. 

]\Ir. Alagia. They asked me about those sometime in 1972, after the 
IRS had issued a Treasury information release on campaign contri- 
butions. 

Mr. Weitz. Who is "they ?" I am sorry. 

Mr. Alagia. Mr. Mueller. 

Mr. Weitz. I see. By way of asking your advice ? 

]\Ir. Alagia. Yes, from a legal point of view. 

Mr. Weitz. But at the time in 1971, in the course of making these 
contT'ibutions, were you at all involved in those contributions? 

Mr. Alagia. No, sir, I was not. I didn't even know they had made 
those to those funny committees. 

Mr. Weitz. I think the record shows that what we are referring 
to is, just for the record, 12 checks, each for $2,500, for a total of 
$30,000, drawn and contributed by SPACE on August 19, 1971. That 
is what the record shows the SPACE reports indicate. 

Now, in connection with those transcactions, you have no contem- 
poraneous knowledge of those contributions ? 

Mr. Alagia. No, sir. 

Mr. Weitz. Since the time of those contributions with Mr. Morgan? 
The fact that they were made or tlie circumstances ? 

Mr. Alagia. I am sure we have. 



7078 

Mr. Weitz. Has he ever, in fact, told you that those contributions 
were made and how in fact they came to be paid ? 

Mr. Alag.ia. How they came to lie made ? 

Mr. Weitz. Yes, who asked for them, who tnade the decision, who 
they were delivered to, and so forth. 

]VIr. Alagia. I mean since all of this has come up. you know, we 
have gone back and looked at the records. I am sure we have had dis- 
cussions on them. 

Mr. Weitz. Could you identify various documents that are related 
to those transactions such as the authorization vouchers and so forth, 
the SPACE vouchers? Have you been shown them since then and has 
it been explained to you which in fact were the vouchers for those 
contributions ? 

Mr. Alagia. You mean the $2,500 ? 

Mr. Weitz. Yes, in August 1971. 

Mv. Aeagia. I am not sure. 

IVIr. Weitz. T am going to show you them and ask you 

Mr. Alagia. T think I have seen them. 

Mr. Weitz. If you have seen them, you may be able to identify 
them. 

^h\ Alagia. Let me ask vou. tliese are the records that you got 
from Mr. Mueller on SPACE 

Afr. Weitz. That is right. 

Let me ask you this. Have you ever been shown, subsequent to the 
time it was drawn, an authorization voucher for one of the committees 
which shows that the cheek or checks are to be sent to Reeves and 
Harrison, attention ]Mr. Murray Chotiner ? 

Mr. Alagia. Yes, I think we have, you know, I have seen these 
since this came up. 

INIr. Weitz. I understand. Subsequent to that time. 

Mr. Alagia. Yes, sir. 

Mr. Weitz. Do you have any knowledge of, for example, the in- 
volvement of Mr. Chotiner in those contributions ? 

Mr. Alagia. !^o, T do not. 

Mr. Weitz. Has ]Mr. ^Morgan ever told you the circumstances sur- 
rounding those contributions ? 

Mr. Alagia. You mean the $2,500 ? 

Mr. Weitz. Yes, the aggregate $.'')0.000 contribution in Ausfust. 

Mr. Alag-ia. Of course. I didn't know about those until such time 
as I had read about them in tlie newspapers or when thev asked me 
for a legal opinion as to whether or not there was any gift tax con- 
sequences. 

Mr. Weitz. I understand that. AVhat T am saying is — I am not 
sayin.^r, even if it is not contemporaneous, this committee has ac- 
cepted information which is either after the fact or even hearsay and 
then weighed it in that light. INfy question is. subsequent to the time 
of tlie contributions, have you had any discussions with Mr. INforgan, 
Mr. Mueller, or anyone else familiar with these transactions and been 
told aiiythinc: about those transactions as far as how the}- were solic- 
ited or any other clrrumstances ? 

Mr. Alagia. No, T didn't. T^et me tell you, if thev did — they could 
have, but I don't recall. T mean T liave spent my time doing a lot of 
other things besides worrying about dairy and SPACE and milk. 



7079 

Mr. Weitz. Now, if the record shows that on the 19th, six checks 
totaling $15,000 were contributed to a number of committees that 
were inchided in a list with these 12 committees and those contribu- 
tions were made by ADEPT, do you have any knowledg:e, either at 
the time or subsequent to that time, of whether there was a connec- 
tion between those two contril)utions— the $15,000 by ADEPT and 
the aggre^rate of $?,0,000 by SPACE ? 

Mr. AlagIx\. Now, you are asking the wrong fellow for those 
questions. 

]Mr. "Weitz. I can only ask you for your knowledge. 

Mr. xVi.AGiA. Right. 

Mr. WErrz And you have never been told how SPACE came 
by those 12 committees ? 

Mr. Alagia. If they have told me, I don't recall it. I mean, it is 
possible they could have told me those things, but when you don't live 
with that stuff day by day, you just don't keejD track of it. 

Mr. Weitz. Now, at the time or subsequent to the time of 1971, 
were you ever told of a couimitment by AMPI and perhaps other co- 
ops to — a commitment made by representatives of AMPI to contribute 
$90,000 a month to the President ? 

Mr. Alagia. I read that in the newspaper and was surprised. 

Mr. Weitz. You had never heard of that before ? 

Mr. Alagia. I had never heard about that. 

Mr. Weitz. Had you ever had any knowledge other than what you 
have i-ead in the newspapers about a $2 million commitment by the 
dairy people? 

Mr. Alagia. I most certainly do not. 

Mr. Weitz. In 1972, the records again indicate for SPACE that on 
August 2, 1972, $25,000 was contributed by check to Democrats for 
Nixon and on October 28 of that year, another $25,000 was contributed 
to a Finance Committee To Re-Elect the President. Do you have any 
knowledge- — did you have any knowledge at the tima of either of those 
two contributions either by way of your advice being asked or just 
being told that they were being made, or anything else ? 

Mr. Alagia. No; I didn't know they were being made. I mean after 
the fact, somebody might have told me about it, and I think they did, 
and I was upset, you know, giving money to Democrats for Nixon. I 
didn't know how that was possible. 

!Mr. Weitz. Do you know whether, in connection with the contribu- 
tion to Democrats for Nixon, Mr. Morgan or anyone else had met with 
Mr. Connally? 

Mr. Alagia. I think Mr. Morgan has told you he met with Mr. 
Connally. 

Mr. Weitz. Do you know whether at that meeting or in connection 
with that meeting, that contribution was solicited? 

Mr. Alagia. Now, I was not tliere and I don't know what went on 
and I am not the man to ask about that. 

Mr. Wetpz. Well, again, I have to ask you, did Mr. Morgan ever 
tell you whether he was solicited for that contribution and if so, by 
whom? 

Mr. Alagia. Well, now, if he told m'e, I don't — I mean he could have 
told me but I just didn't keep track of it. 



7080 

Mr. Weitz. Did he indicate that in fact, someone had asked for the 
contribution ? 

Mr. Alagia. I just don't recall. 

Mr. Weftz. Did you normally, after you left, did you have oc- 
casion from time to time to talk to Mr. Morgan about certain key con- 
tributions or certain key decisions by SPACE before the 1972 
election ? 

Mr. Alagia, About the 1972 election ? 

Mr. Weitz. Yes; certain key decisions. Not evei-y contribution, but 
certain key decisions or major contributions? 

Mr. Alagia. No, not major contributions, ]>ut if a man was run- 
ning like you, you know, Senator Huddleston, who is a friend of mine, 
why, I brought him in, asked the committee to talk with him and sup- 
port him, and he understands — at least he knows what a farmer does. 

Mr. Weitz. Now, do you have any — I believe you have indicated — 
let mo ask you this: Was there a straw vote taken at a meetino- of an 
advisory group for SPACE or some other type of meeting of support 
for one or the other Presidential candidates after Mr. McGovern's 
nomination in 1972? 

Mr. Alagia. Yes, sir. 

INIr. Weitz. What was the approximate result of that straw vote? 

INIr. Alagia. Evervbody in the room voted for President Nixon ex- 
cept one vote for INIcGovern. 

Mr. Weitz. Whose vote was that ? 

Mr. Alagia. That was me. 

Mr. Weitz. And my question, was that straw vote taken to provide 
guidance as to Presidential contributions for the remaining part of the 
year? 

Mr. Algia. No, it was obvious that the SPACE advisory group were 
going to go with the incumbent Republican. 

Mr. Weitz. With the President. OK. 

Do you recall approximately when that meeting took place and that 
straw vote took place? 

Mr. Alagia. Do you know ? 

Mr. Weitz. I think T know, but let me ask you this. 

Mr. Alagia. If you know, tell me and we will save sometime. 

Mr. Weitz. Do you connect it with some time shortly after the 
Democratic National Convention or many montlis thereafter or several 
montlis thereafter? 

Mr. Alagia. It was about the time. It could have been before even 
he was the nominee. 

Mr. Weitz. Before the President was the nominee ? 

Mr. Alagia. Yes. 

Mr. Weitz. But after Mv. McGovem was tlve nominee ? 

Mr. Alagia. INIm'hmm. 

Mr. Weitz. So if it is indicated tliat the meeting and the straw vote 
took place on July 25, 1972. is that consistent with your recollection, 
which would have been a couple of weeks after the Democratic 
Convention ? 

Mr. Alagia. It was eithei- before the convention wlien he was the 
front runner or shortlv thereafter. 



7081 

Mr. Weitz. So would it be a fair characterization that your recol- 
lection is that it was in the summer of 1972, sometime in the summer, 
June or July, perhaps? 

Mr. Alagia. Yes, give or take a few months either way. 

Mr. Weitz. Let me ask you this : Can you explain why no contribu- 
tions were made to the Committee To Re-Elect or the Finance Com- 
mittee To Re-Elect the President until just prior to the election? 

Mr. Alagia. Can I ? 

Mr. Weitz. Yes. 

Mr. Alagia. No. 

Mr. Weitz. Do you attach any significance to the fact that 
October 28, the date of the $25,000 contribution to the finance com- 
mittee, is after the final reporting date before the election to the 
GAO? 

Mr, Alagia. You would have to check with Mr. Mueller on that. 

Mr. Weitz. No one has ever talked to you about it since that time, 
of any significance as to the date of that contribution or the timing 
of that contribution. 

Mr. Alagia. Let me ask you, did the GAO make an inquiry about 
that? 

Mr. Weitz. I don't know. 

Mr. Alagia. I am not trying to ask you questions, but the GAO, 
if they would make an inquiry — and you know, they have made some. 

Mr. Weitz. Let me step back for a minute and explain. There is 
nothing illegal about making a contribution on October 28 and re- 
porting it when the next reporting date calls for it. 

Mr. Alagia. I am glad to know that. 

Mr. Weitz. At least not to my knowledge. I am not giving you free 
legal advice. That is my understanding. 

Mr. Alagia. I am sure you are not giving me free legal advice. 

Mr. Weitz. My question is, however, in the context that if a con- 
tribution was made in fact on October 28, 1972, then existing law 
did not require that it be reported prior to the election of November 7, 
1972. 

My question is, although there was nothing illegal about the timing 
of the contribution, do you attach any significance to it or did anyone 
ever tell you of the significance of the timing of the contribution ? 

Mr. Alagia. I attach nothing sinister to it and no one has told me 
or consulted with me on that that I know of on this October 28 — is 
it October 28 ? 

Mr. Weitz. Yes, I believe so. 

Mr. Alagia. "\Yliat was the contribution ? 

Mr. Weitz. $25,000. 

Mr. Alagia. Oh, that one I don't have anything on. 

]\Ir. Weitz. Did Mr. Morgan tell you of any meetings he had in 
1 972 with Mr. Kalmbach ? 

Mr. Alagia. I knew he went, you know, from one of his depositions, 
to see Kalmbach. I haven't, you know, sat down and asked him about 
those meetings. 

Mr. Weitz. Was the purpose of those meetings to solicit money 
from SPACE ? 

Mr. Alagia. You are asking me the purpose of the meetings when 
I didn't go. 



7082 

Mr. Weitz. Did Mr. Morgan ever tell you whether solicitations 
were ever made or contributions discussed at that meeting with Mr. 
Kalmbach ? 

Mr. Alagia. I think he has reported to your people on the Senate 
Select Committee what transpired at those meetings and I am not 
going to be trying to second-guess him. He was there. 

Mr. Weitz. And one final ciuestion. Do you have any knowledge 
of any contributions, your knowledge either being direct or from 
hearsay or other indirect sources, of contributions made by the other 
two co-ops during 1972 for the President's reelection ? 

Mr. Alagia. You mean other than what I read in the newspaper 
and all that stuff? 

Mr. Weitz. That is right, yes. 

Mr. Alagia. You know, I — no. I would say no I don't. I have tried 
to give you what I know and I just don't keep, you know, track of 
those things any more. 

Now, I mean, there may be some that I am supposed to be aware 
of that I don't now recall, but I don't know what they would be. I just 
didn't — when I resigned on March 10, 1971, I was getting back into 
law practice and trying to maintain what I had. 

Mr. Weitz. All right. 

Mr. Plotkin. Off the record just a minute. 

[Discussion off the record.] 

Mr. Plotkin. On the record. Do you know of SPACE, ADEPT, 
TAPE, or any of the co-ops providing any services or funds to any 
Democratic candidates or contenders for the Presidential nomination, 
to the best of your knowledge ? 

Mr. Alagia. During what period of time ? 

Mr. Plotkin. The 1972 election ? 

Mr. Alagia . In 1 972 

Mr. Plotkin. For the 1972 election. It might have started back in 
1971 or 1970, whenever everybody started running for office. 

Mr. Alagia. Well, now, I mean I have read in the newspapers about 
AMPI providing apartments for some, I don't know whether they 
vrere announced or unannounced, candidates up here. I mean I have 
read something. 

Mr. Plotkin. Do vou have any personal recollection of any services 
or any funds contributed by cash or by check that you were aware 
of at the time that the services were provided or the cash or checks 
were provided to any Presidential contenders ? 

Mr. Alagia. No. I mean in the 1972 election, I just was not, you 
know — well, I was interested in some of the senatorial candidates 
running, like in Kentucky. I didn't spend my time, you know, trying 
to run this kind of stuff down. 

Mr. Plotkin. Now, I would like to ask the same question with re- 
gard to anv senatorial congressional elections that took place in 1972 
where goods or services or cash or check contributions were provided 
by any of the dairy co-ops or any of the political arms of the dairy 
co-ops ? 

Mr. Weitz. May I just, before the witness answers, I don't want to 
impede or I will not ask that the witness not answer. I think he should 
go ahead and answer it for a complete record. But let me just note 
for the record that I believe the question calls for testimony that falls 
outside our mandate and I just do want it noted for the record, so that 



7083 

if at a proper or appropriate time, some similar question, either at a 
public session or use of this executive session for the public record, will 
conform to the mandate and a proper ruling will be reqiiested from 
the committee. 

Mr, Plotkin. A further clarification of the question. Some people 
who were congressional or senatorial candidates may have been infor- 
mal or unofficial candidates for the Presidency while at the same time 
they were standing for reelection for the congressional or senatorial 
offices. For that reason, if it has subsequently come out that they were 
never really official Presidential candidates, I just want to establish 
whether they received any of these finances or services for their 
senatorial or congressional elections. 

Mr. Alagia. As I say, the only ones I would have read about would 
have been in the newspaper involving AIM PI or those apartments for 
Mr. — I think it was Mr. Mills, I am not sure. 

Mr. Plotkin. You have no independent recollection. OK. 

Now, with regard to the 4 a.m. meeting in the airport in Louisville. 
Without rehashing everything you stated before, was it your intention 
at the time of that meeting to in any way ever give any considertaion 
to loaning SPACE funds, arranging for the loan of SPACE funds to 
ADEPT? 

Mr. Alagia. Absolutely not. 

Mr. Plotkin. OK. Would you tell me for the record what your per- 
sonal impression was of Mr. Nelson ? 

Mr. Alagia. You mean at that meeting? 

Mr. Plotkin. At that meeting and in general ? 

Mr. Alagia. Well — well, of course, at that meeting — you know, I am 
just sorry you fellows can't experience something like that, have four 
of them descend on you at the airport. I wanted to gracefully, you 
know, get out of there, to leave. I didn't appreciate that type of descent 
at that hour of the morning. 

My impression of Mr. Nelson, whether that is material or not— T 
don't know what good that will do — but it was quite apparent to me 
at this time, with what I now have knowledge of, that they, the AMPI 
group, would have done anything to have merged Dairymen, Inc., into 
AMPI. And he mig'ht play one member of a management team against 
the other. 

Mr. Plotkin. He isn't someone you would care to deal with ? 

Mr. Alagia. Well, at this time, I would say no. 

Mr. Plotkin. Are vour feelings similar toward Mr. Parr and 
Mr. Lilly? 

Mr. Alagia. Toward who? 

Mr. Plotkin. Mr. Parr and Mr. Lilly. 

Mr. Alagia. I never had any dealings to speak of with Bob Lilly. 
He was at the airport this morning, you know, and he was at some of 
these meetings. They are always at meetings. 

And Dave Parr, if he would stay in the management field as a 
marketing man, a milk man, he is a good marketing man. And Harold 
Nelson is a promoter. 

Mr. Plotkin. It is absolutely clear for the record that your meeting 
with them in the airport was contrary to anything you would have 
wanted under those circumstances at that time and that there was 
never any intention to further investigate or participate in any request 
or eifort on their part to obtain funds from SPACE ? 



7084 

Mr. Alagia. Absolutely. I mean, they sought me out and descended 
on me and I wanted to get up and leave and I got up, if I was sitting 
down — I am not even sure I sat down. If I sat down, it sure was not 
for long. 

Mr. Plotkin-. Just two final questions. Is Mr. Morgan a lawyer? 

Mr. Alagia. No, he is not ; he is an economist. 

Mr. Plotkin. Did you advise him at the time that you passed on the 
events of the meeting at the airport that it was your opinion that 
loaning SPACE funds of $100,000, or any amount, to ADEPT would 
be illegal in your opinion ? 

Mr. Alagia. In my judgment, I told him, he should not even consider 
that, because that law didn't say that in my book. 

Mr. Plotkin. Thank you. 

Mr. Weitz. I just have three questions. 

First of all, were you aware that TAPE in fact made a loan the 
following month, April 1971, to ADEPT, of $50,000 ? 

Mr. Alagia. April what ? 

Mr. Weitz. 1971. to ADEPT. Were you aware of that ? 

Mr. Alagia. Well, looking over the records, yes, I am now aware of 
that. I am aware that talking with DeVier Pierson, he called me about, 
you know, whether SPACE was going to lend money. I said, I don't 
think, in my judgment, the law permits that, and I tell you right now 
we are not going to do that. 

Mr. Weitz. Was that shortly after the meeting at the airport ? 

Mr. Alagia. I think it was, you know, a week or so. 

Mr. Weitz. Did you ask him to call or did he call you ? 

Mr. Alagia. No, he called me. 

Mr. Weitz. Did he tell you who told him to call you or who had 
informed him of this possibility ? 

Mr. Alagia, No, but I can only — you know, I don't want to assume, 
but it had to be somebody from AMPI or Mid-America. 

Mr. Weitz. Did he indicate that TAPE was going to in fact or 
might make a loan to ADEPT ? 

Mr. Alagl\. No, he didn't tell me that. 

Mr. Weitz. Did he indicate that there was an urgency in the context 
of the 29th of jNIarch such as they had at the airport with you? 

Mr. Alagia. No, he didn't indicate that to me. I just remember a 
telephone call from him along those lines and I told him that SPACE 
was not going to — you know, I didn't think it proper for one com- 
mittee to lend to another. 

Mr. Weitz. Is David Parr now employed by DI ? 

Mr. Alagia. By Dairymen. 

Mr. Weitz. Do you know in what capacity he now serves as an 
employee? 

Mr. Alagia. The board of directors of Dairymen employed him 
and I don't knoM- the exact date, sometime in 1972. I think you were 
furnished the information on that, Mr. Weitz. I think l\fr. IVIorgan 
gave you an explanation of what he does. I don't follow him. I know 
he talks to producers at producer meetings and different things. I 
mean I am aware of that. 

Mr. Weitz. I have no further questions. 

Thank you, Mr. Alagia. 

We will recess the session. 

[Whereupon, at 5 p.m., the proceeding was concluded.] 



MONDAY, JANUARY 28, 1974 

U.S. Senate, 
Select Committee on 
presroential campaign activities, 

Washington^ D.C. 

The Select Committee met, pursuant to notice, at 10 :10 a.m. in room 
442, Russell Senate Office Building. 

Present : Senator Inouye. 

Also present: James Hamilton, assistant chief counsel; Donald 
Sanders, deputy minority counsel; Benjamin Plotkin, minority 
investigator. 

Senator Inouye. Would you raise your right hand, please ? 

Do you swear that the testimony you are about to give is the truth, 
the whole truth, and nothing but the truth, so help you God ? 

Mr. TowNSEND. I do. 

Senator Inouye. Thank you, sir. 

Mr. Hamilton. Well, Senator, what I was going to do was to raise 
a matter of procedure, even before we start, the initial questioning. 
Mr. Vanet has made a dual request to us. One : That he be allowed to 
tape record this morning's executive session, and two : In regard to a 
prior executive session, that he be allowed to read it, and as I mider- 
stand it, to make verbatim notes out of the session. 

Now, it is my underetanding of the rules of procedures of the com- 
mittee, that this would not be allowed, because executive sessions are 
only released by a majority vote of the committee, and this, in effect, 
would be the releasing of an executive session. But Mr. Vanet has 
made this request, and I think that he should be allowed to put it 
formally to you, so that you can make a ruling on this request. 

Senator Inouye. Well, the transcript he is speaking of is what, now ? 

Mr, Hamilton. This is an earlier transcript. Senator, of Mr. Town- 
send. We are calling him back, because we now have some other matters. 

Senator Inouye. Were you present at this ? 

Mr. Vanet. Yes, I was. The way I read the rules we are entitled to 
a transcript of his testimony. We requested a transcript prior to giving 
the testimony, and we have not received a copy of it. We have been 
advised we probably would not get a copy, and we have cooperated and 
testified before. And we are here, ready, and we want to testify, but I 
am going to insist on my right to take a copy of what he testifies today ; 
and what I would like to do, although I'm not going to hold up his 
testifying today, if I can't; but I would like also to have a ruling that 
I may dictate, after the hearing today, the transcript that Mr. Hamil- 
ton lias from the prior hearing. Otherwise, I am just going to advise 
my client not to testify today, and take the fifth. I don't want to do 
that. I want him to testify. He is here, he has cooperated. 

Senator Inouye. Well, I have never heard of any person being per- 
mitted to take in a tape recorder during executive sessions. I presume — 

( 7085 ) 



7086 

not presume, I would think — that the interpretation of the rule, as you 
set forth, is correct in that sense; but there is no rule prohibiting 
counsel to take notes during executive sessions. And so, as to one part- 
of your request, that you be permitted to take notes from that tran- 
script 

Mr. Vanet. I just wanted to redictate them into my recording ma- 
chine after the fact. In other words, the rules expressly provide I am 
entitled to a copy of the transcript. 

Mr. Hamilton. I don't believe that is right. Senator. 

Mr. Vanet. It is the way I read it, and if we're going to get a copy 
of both transcripts, well then fine, I've got no objection. But, you know, 
down the road, in case something comes up 

Senator Inouye. Copies of the transcript, sir, as I recall the rule, 
have never been provided to any person other than appropriate staff 
and members of the committee. I)o you have a copy of the rule there ? 

Mr. Vanet. Senator, it says if it is made public 

Mr. Sanders. I just asked my secretary to bring one. She will be 
here in just a moment with a copy. 

Mr. Hamilton. I believe the rule is. Senator, that if the transcript 
is going to be made public for one reason or another, perhaps for sub- 
mission into the record, that takes a majority vote of the committee. 

Senator Inouye. Has this been made public? 

Mr. Hamilton. This has not been made public yet. You asked for 
some type of precedent, and I think the main precedent I can think of 
is in regard to the Chester Davis matter. You remember there was a 
vote of the committee in regard to making that available, certain 
transcripts available to Mr. Davis for his court litigation, and 
Mr. Davis only got it because the committee authorized his having it 
for that purpose. I think it is rule 24, but I am not sure. 

Mr. Vanet. I thought I imderetood that one witness had a stenog- 
rapher present when his testimony was given. 

Mr. Hamilton. Well, there may have been for one reason or another 
some change in the rules. I think I know what you're talking about. 
I don't know under what circmnstances that was done, but certainly 
the normal situation — I believe I mentioned the wrong rule — the 
normal situation is that executive sessions are not made public. 

Senator Inouye. That is rule 27. 

Mr. Hamilton. Would you like to see this ? 

Senator Inoitytc. Rule 30. 

Mr. Hamilton. Would you like to see rule 27 ? 

Mr. Vanet. Yes. I reinember it says, if it is going to be made 
public 

Senator Inouit:. Rule 30 says the witness shall, upon request, be 
given a reasonable opportunity, before any transcript is made public, 
to inspect, in the office of the committee, the transcript of his testi- 
mony to determine whether it was correctly transcribed, and may be 
accompanied by his counsel during such inspection. If the witness so 
desires, the committee will furnish him a copy of his testimony at no 
expense to the witness. 

In this case, does the committee plan to make public this transcript? 

Mr. Hamilton. Well, Senator, we don't know that yet. But we will 
let ISIr. Townsend and his counsel read the last transcript, and this 
one, too, of course, after it is transcribed. And it has been procedure 



7087 

that counsel can make notCvS, not verbatim notes, bnt can make not€S on 
the content of the transcript. What we have proscribed in the past, 
and Avill continue to do so unless the committee, of course, votes other- 
wise, is to prohibit counsel either from making verbatim recordings, 
or from taking a transcript and reading it verbatim into a tape 
recorder. 

Mr. Saxders. Senator, I think that rule contemplates that the fur- 
nishing of the transcript, when requested by the witness' counsel, 
would occur at such time as the committee thinks that it would make 
it public. 

Mr. TowNSEXD. Well, I don't have any hesitation in terms of pro- 
ceeding anyway. I am perfectly willing, if counsel would agree to 
waive the objection. 

Senator Tnouye. In view of rules 27 and 30, I would have to deny 
the request of counsel, but as noted by committee counsel, I see no 
objection to the witness' counsel taking notes during the executive 
meeting. 

Furthermore, I see no objection to counsel taking notes from the 
transcript of the prior hearing. 

Mr. Hamilton . Well, Mr. Vanet, if you 

Mr. Vaxet. Well, if Tom doesn't mind, we will go ahead, then. If 
it's all right with him, it's fine with me. Irrespective, it's my inclina- 
tion to say "no", but if he wants to go ahead, fine, 

Mr. Hamilton. All right. 

I think we should recess this session, and move to 334, if that's all 
right; so then we won't take up any more of the Senator's time. 

[Whereupon, at 10 :20 a.m., the Select Committee recessed, to recon- 
vene in Room G-334, Dirksen Senate Office Building.] 

Mr. Vaxet. I would state for the record that I would include here- 
in, and incorporate by reference, the objections made at the first testi- 
mony of this witness before this committee, in order to save from 
repeating them again at this time. 

Mr. Hamilton. OK. Mv. Townsend, just for the record again, would 
you state your full name ? 

TESTIMONY OF THOMAS W. TOWNSEND, ACCOMPANIED BY 
M. RANDALL VANET, COUNSEL 

Mr. Townsend. Thomas W. Townsend. 

Mr. Hamilton. I am going to avoid going into your background, as 
we did earlier, but just so I can be completely clear ; as I understand 
it, you worked for AMPI from the beginning of 1970 until sometime 
in i972. Is that correct ? 

Mr. Townsend. That is correct. 

Mr. Hamilton. Sometime in April 1972, 1 believe ? 

Mr. Townsend. February. 

Mr. Hamilton. February 1972. 

Mr. Townsend. And it started — my employment with AMPI 
started when AMPI started, not 1970. 

Mr. Hamilton. And for a certain period of time, you were special 
assistant to Mr. Nelson. What was that period of time? 

Mr. Townsend. Gosh, I really don't recall when it began. I would 
think probably sometime in 1970, until Mr. Nelson was relieved as gen- 
eral manager in 1972. 



7088 

Mr. Hamilton. And I believe that 3^011 told us last time, even though 
you were assistinof Mr. Nelson that you worked primarily for Mr. 
Parr. Is that correct ? 

Mr. TowNSEND. Yes. that is correct. 

Mr. Hamilton. Now, Don, I'm not g:oin^ to g'o into any more back- 
ground unless you want to, because I think it is fairly fully covered 
in this earlier session. 

Mr. Sanders. Go ahead, Jim. 

Mr. Hamilton. Mr. Townsend, in 1971, do you recall, or do you 
have any knowledge of, any cash contributions being made to Con- 
gressman Mills ? 

INIr. Vanet. Excuse me, and again, at this time. I'm going to advise 
the witness, that at any and all times, questions asked encompass only 
the 1972 Presidential campaign, and answer any questions accord- 
ingly. If there's any confusion in your mind about the scope of the 
question 

Mr. Hamilton. Well, that is the scope, but I think that, 

Mr. Vanet. Well, because it could go back to 1940, maybe he knew 
something. 

Mr. Hamilton. Well, I am talking now about contributions made to 
Mr. Mills in 1971. I'm not asking about contributions made in 1940, 
but if the witness has any knowledge of any contributions made in 
1970, I wish he would answer, and we can discuss them. And if he 
thinks they were not related to the Presidential campaign, then either 
he or you can say so. 

But my question is, in 1971, do you have knowledge of any contribu- 
tions, for any purpose whatsoever, going to Mr. Mills ? 

Mr. ToAVNSEND. You mean, cash versus checks. You don't mean 
checks ? 

Mr. Hamilton. I'm talking about caE^h at the moment. 

Mr. Townsend. Yes. I took an envelope that contained, as I under- 
stand it, as I was told, some cash and some checks from Little Rock 
to Washington one time, when I was coming to Washington from 
Little Rock. 

Mr. Hamilton. Can you date this? 

Mr. Townsend. Well, not very precisely. I would sav sometime in 
the fall or winter of 1971. 

Mr. Hamilton. Well, are you sure that wasn't in August of 1971? 

Mr. Townsend. No. I'm not sure it wasn't in August of 1971. 

Mr. Hamilton. But your best recollection is that it was the fall or 
winter of 1971 ? 

Mr. Townsend. Yes, sir. 

Mr. Hamilton. Can you remember that the weather was chilly ? 

Mr. Townsend. I just don't have any recollection. It didnt seem 
much out of the ordinary to me. There is nothing that I recall about it. 

Mr. Hamilton. Tender whose instructions did you do this? 

Mr. Townsend. Mr. Parr's. 

Mr. Hamilton. Did Mr. Parr tell you. or did you look in the en- 
velope, to determine what was in the envelope ? 

Mr. Townsend. I did not look in the envelope, that I recall. He said 
that it was some checks and some cash. I had the idea. I'm not sure 
what he said, exactly, but I think that it was a whole group of small 
contributions. It may have been that the check that I wrote for Chair- 



7089 

man Mills was in the group. I wrote a $50 check to the Mills campaign. 
Mr. Hamilton. Did he tell you how much cash there was? 
Mr. TowxsEXD. I believe he said there was slightly less than $5,000 
total, and I don^ have any idea of how much of that would have been 
in cash, and how much of that would have been in checks. 

INIr. Hamilton. What was the nature of the envelope ? A small, white 
envelope ? 

Mr. TowxsEXD. Yes, it was a small, regular, letter-size envelope. 

Mr. Hamilton. And was it chocked full, was it bulky, or was it 
reasonably 

Mr. TowNSEND. I would say that it was maybe half an inch. 

Mr. Hamilton. Half an inch ? 

Mr. TowNSEND. Slightly less than the thickness of my thumb, I 
would say. 

Mr. Hamilton. What I'm trying to get at — ^did you have the impres- 
sion that there were 20 or 30 checks, 20 or 30 bills in there, or that 

Mr. TowNSEND. I would say there were more than 20 or 30. Gosh, I 
would hate to guess — it was fairly thick, as I indicated to you. I had 
the impression there might be — oh, 100 checks or bills. 

INIr. Hamilton. The envelope, I take it, was sealed ? 

Mr. TowNSEND. Yes, it was. 

Mr. Hamilton. And you didn't look at it at any time ? 

Mr. TowNSEND. No, I did not. 

INIr. Hamilton. Did Mr. Parr say anything to you about whether it 
was mostly cash or mostly checks ? 

INIr. TowNSEND. I don't recall that he did. 

Mr. Hamilton. Did he tell you the source of the money ? 

Mr. TowNSEND. No, he did not. 

Mr. Hamilton, ^^^lere did you get your impression that it was small 
contributions, like the one you had made? 

Mr. TowNSEND. From Mr. Parr. 

Mr. Hamilton. What exactly did he say ? 

Mr. TowNSEND. I don't remember exactly what he said. I think it 
was something like, "I've got some contributions that I would like to 
have you take up to Washington," and I said, "OK;" and he said, 
"Now be careful, because some of it is cash," and I said, "Well, is it a 
large amount of cash?" and I think he said, "No, there is some cash 
and some checks, and it's less than $5,000," or something along that 
line. 

Mr. Hamilton. Did he mention to you that there were any contribu- 
tions in there from AMPI per se ? 

Mr. TowNSEND. Oh, no, no. 

Mr. Hamilton. Did he tell you where the contributions were from ? 
Did he indicate that they were from people like you in AMPI, per- 
haps ? 

Mr. TowNSEND. I don't recall what he said. That was, I think, my 
conclusion, from something he said-4here is some cash, and there is 
some checks, and it may have been that this was after I gave $50, and 
I may have — it may be all my assumption, you know. This is 21^ years 
ago, and it may be all my assumption that it was small contributions, a 
whole bunch of them. But it was, as I say, a very substantial envelope. 

Mr. Hamilton. To whom did you deliver this money ? 

Mr. TowNSEND. I gave it to Gene Goss. 



30-337 O - 74 



7090 

Mr. Hamilton. Did you tell Mr. Goss what it was when yovi gave it 
to him? 

Mr. TowxsEND. Yes, I think I said that it came— 4hat Dave asked me 
to bring this up to Washington. 

Mr. Hamilton. You did bring it to Washington? Goss was in 
Washington at this time ? 

Mr. TowNSEND. Yes. 

Mr. Hamilton. Did you tell him how much was in there? 

Mr. TowNSEND. I don't recall that I did, no. 

Mr. Hamilton. Did you tell him what the nature of the contribu- 
tions was ? 

Mr. TowNSEND. I don't recall that I did. 

]Mr. Hamilton. Did he open the envelope in your presence ? 

Mr. TowNSEND. I don't believe that he did. 

Mr. Hamilton. "WHiat did he do with it ? 

Mr. TowNSEND. I think it just sat on the corner of his desk until 
after I left, but he may have picked it up and put it in the desk drawer. 
I just don't recall. 

Mr. Hamilton. Do you recall if he said what he was going to do 
with it? 

Mr. TowNSEND. No, I don't recall. 

Mr. Hamilton. I mean, for example, did he say, "Well, I will send 
this downtown to the Draft Mills for President office" ? 

Mr. TowNSEND. I just don't recall. 

Mr. Hamilton. Now, in placing the date of this transaction, do you 
know if it was in proximitv to the appreciation meeting or rallv that 
was he! d for Mr. Mills in Little Roclv ? 

INIr. TowNSEND. I don't remember when that was. 

Mr. Hamilton. Well, I think that was in August of 1971. Did you- 
att<^nd that? 

Mr. TowNSEND. Yes. I did. I don't remember whether it would have 
been before or after. I just really don't remember. 

Mr. Hamilton. Well, you were in Little Rock, I believe. Now, I 
may be wrong in this. I don't want to shape your testimonv, but didn't 
you participate in the planning for that appreciation meeting? 

Mr. TowNSEND. No, sir, I did not. 

Mr. Hamilton. You did not ? 

Mr. TowNSEND. No. 

Mr. Hamilton. Were you in Little Rock several days before then? 

Mr. TowNSEND. I think that I was, but I have submitted my calen- 
dar to the committee, and I'm sure that It would accurately reflect 
where I was on my expense reports. 

Mr. Hamilton. I take it your testimonv is that you did not partici- 
pate in any Avay in the organization or planning for, or getting out of 
participants for the INIills rally ? 

,Mr. TowNSEND. Boy, I just don't recall a darn thing that I per- 
sonallv did. I knew that the rally was going on. I mav have run a few 
errands or something- like that, but as far as really having anything 
to do with the rally, I didn't feel that — and when I attended the rally, 
I went as a spectator. I took my wife and my two children along, and 
just sat up in the stands. 

Mr. Hamilton. Well, you said you ran a few errands, do you 
remembei- perhaps making a deliverv of some money to the rally 
organizers, some money given to you by Mr. Parr? 



7091 

Mr. TowNSEXD. Well, I just don't know who the rally organizers 
were. Could you tell me a name or something? 

Mr. Hamilton. Well, I believe the name — I believe the State party 
chairman down in Arkansas was running it. Don, was his name 
Purcell ? 

]Mr. Plotkin. Mr. Purcell. 

]Mr. Hamilton. I believe INIr. Purcell was the organizer; Mr. Ward 
was participating, jNIr. Charles Ward. 

Mr. TowNSEND. I know Charlie Ward, but I'm not sure I ever met 
Mr. Purcell. "^^^lat was his first name ? 

Mr. Hamilton. Frankly, I've forgotten. 

Mr. TowNSEND. I don't believe I've ever met Mr. Purcell. 

Mr. Hamilton. Well, do you remember making a delivery for Mr. 
Parr to anyone in the INIills' organization of some moneys that would go 
to cover the expense of the rally ? 

Mr. TowNSEND. Boy, I just sure don't. It's possible I may have, but 
I sure don't remember. 

Mr. Ha^iilton. Do you know if A]MPI in any way financed that 
rally or meeting for Mr. ISIills? 

Mr. TowNSEND. No, sir, I do not know. 

Mr. Hamilton. You know of no expenses that they paid for, no 
contributions that they made ? 

Mr. TowNSEND. That AMPI would have made ? 

Mr. Hamilton. Yes, that AISIPI Avould have made. 

Mr. TowNSEND. No, sir, I do not. 

Mr. Hamilton. Well, it is true, is it not, that they supplied some milk 
for that rally ? Isn't that right ? 

]\Ir. TowNSEND. If they did, I'm not aware of it. 

Mr. Ha3iilton. Well, was your perception of that rally that it was 
a Mills for President rally? It was a rally to start the bandwagon 
rolling for INIr. Mills' candidacy ? 

Mr. TowNSEND. Boy, really, you're just going into details that I 
just honestly don't — t really didn't participate to any considerable 
degree on the — on that Mills rally, and really, you're just in an area 
that I can't honestly answer. 

]\Ir. Ha:\iilton. I undei"stand that. I am really asking for your per- 
ceptions as a spectator, how you viewed it. 

Mr. TowNSEND. I think that I can recall generally overhearing some 
conversations in terms of jNIills for President, and I can't honestly 
i-emember whether it would have been at that time or August. I think it 
would have been at that time, or preAaous to that time. I'm sorry that 
I just can't be any more helpful on that. 

Mr. Hamilton. We are still on contributions, ]Mr. Townsend. Were 
you, in 1971, in the airport at Austin, Tex. ? 

Mr. Townsend. Yes, sir. 

INIr. Hamilton. Do you know at what time ? 

Mr. Townsend. Yes. The committee asked me some que^stions last 
time. That is really the only thing that I wanted to look at in the 
record of my previous testimony, and I said at that time — that was, 
vou know, a completely new thing to me — and I said that I was, and 
I believe there was one time, and at that time it was at a time when 
Chairman Mills spoke to the joint session of the Texas Legislature, 
and there were questions relating to Jake Jacobsen. And I said that I 



7092 

just couldn't remember, and since that time, I thought back quite a 
little bit about that, and I believe that there were two times that I was 
at the Austin airport. 

The one time, when Mills spoke to the joint session of the Texas 
Lecfislature. and I believe I feel quite sure now that there was another 
time that I was there. I flew in with Dave Parr, and we, I think 
inadvertently, saw Bob Lilly at the airport, and Jake Jacobsen was 
there, yes, sir, 

Mr, Hamilton", When was the occasion ? 

Mr, TowxsEND, I don't recall when that was. 

Mr. Hamilton. Might that have been in November of 1971? 

Mr. TowNSEND, It might have been in November of 1971, but you 
knoAv, it might have been back in the spring or summer, or in the fall. 
I just can't place it in reference to any time period, 

Mr, HA:\riLT0N. Well, the first trip was in the spring. Wasn't it in 
April of 1971 ? I believe that's what you testified to last time, 

Mr, TowNSEND, OK, if that's what I testified to, I had my calendar 
at that time, and I did have it on there. 

Mr. Hamilton. And that was the speech to the legislature? 

INIr. TowNSEND. Yes, it was. 

Mr, Hamilton. What was the purpose of the second trip? 

ISIr. TowNSEND, It was a stopoA^er on the way to San Antonio, to 
the best I can recall. It was strictly a stopover that Dave wanted to 
visit with Jake Jacobsen. 

Mr. Hamilton, Do you know why he wanted to visit with Jacobsen ? 

INIr. TowNSEND, No sir, I do not. 

Mr. Hamilton. Do you remember if anything passed hands be- 
tween Jacobsen and Parr ? 

]Nf r. TowNSEND. No sir ; I don't remember anything passing between 
Jacobsen and Parr. 

Mr. Hamilton. Do you remember Mr. Long coming up in the air- 
port ? 

Mr, TowNSEND, Since these questions were asked at the previous 
hearings, I thought about that, and I just honestly don't, I don't know 
whether — I kind of think that ]\Ir, Long was there, but it really just 
doesn't ring a bell to me. I kind of think he was, but I'm just not 
absolutely certain. 

]\f r. Hamilton. Well, do you remember his coming up, that Jacobsen 
was there, and then Mr. Long came up subsequently and gave some- 
thin jr to Mr. Jacobsen ? Does that ring a bell ? 

Mr. TowNSEND. No, sir, it does not ring a bell ; I don't recall any- 
thing that Avas unusual about that particular stopover at all in Austin, 

Mr, Hamilton, Do you think it was unusual that Parr would stop 
in Austin to see Jacobsen ? Was that unusual ? 

Mr. TowNSEND. To the best of my knowledge, it was the only time 
that I was with Dave, to the best of my knowledge, when we stopped 
in Austin and saw Mr. Jacobsen. 

Mr. Hamilton. Well, you were flying in a private plane, then ; the 
AMPI plane? 

INIr. TowNSEND. Yes. It was not an AMPI plane, it would have been 
a leased plane, a chartered plane, probably from Central Flying Serv- 
ice in Little Rock, Ark. 



7093 

Mr. Hamilton. Well, yoii didn't ask INIr. Parr why you were put- 
ting* down? 

Mr. TowNSEND. I don't recall that I asked him. I think that in the 
process of the flight, he said that he was going to stop and see Jake 
for a minute in Austin. I think he volunteered. 

Mr. Hamiltox. And you didn't say, "why do you want to do that?" 

Mr. TowNSEND. Not that I recall. No. 

Mr. Hamilton. Do you remember when ]\Ir. Parr, when he got off 
the plane, did he take anything with him? Can you recall that? 

Mr. TowNSEND. No, I sure don't. 

Mr. Hamilton. Well, when he got back on the plane, do you remem- 
ber if he had an envelo]:>e or something of that nature? 

Mr. TowNSEND. I sure don't. 

Mr. Hamilton. And he didn't tell you, for example, that he just 
picked up some money from Mr. Jacobsen ? 

Mr. TowNSEND. Boy, I sure don't recall that he said anything about 
any money. 

Mr. Hamilton. He didn't mention the amount of $5,000? 

Mr. TowNSEND. I sure don't recall it at all. 

Mr. Hamilton. You have no further recollection of why Mr. Parr 
wanted to visit with Mr. Jacobsen ? 

]Sfr. TowNSEND. No, sir, I don't. I remember that — the only thing 
that I can really remember about it was that we were sitting at the 
counter at a little restaurant there, and I believe that I was on a 
stool, and jMr. Parr was on the next stool, and I believe Mr. Jacobsen 
at the next one, and IVIr. Lilly may have been on the one on the other 
side of that. And the heads were generally — like, we are here, I would 
have been sitting here, and then Mr. Parr and Mr. Jacobsen, and if Mr. 
Lilh^ were there, he would have been on the other side, and I don't 
recall whether he was sitting over there or not. And the convereations 
would have been ]Sfr. Parr looking this way and INIr. Jacobsen this 
way. 

But I recall no conversation. I just don't have any recollection, and 
I think that if there would have been anything in relation to money 
that I overheard, or would have seen anything, I think that I would 
ha^-e recalled it. 

Mr. Hamilton. Well, if Mr. Jacobsen had given Mr. Parr some 
money, do you think ]\Ir. Parr would have told you about it? 

Mr. TowNSEND. Not necessarily. 

Mr. Hamilton. After that time, did you ever hear Mr. Parr say that 
he had another $5,000 to give to somebody, to give to Mr. Mills? 

Mr. TowNSEND. Not that I recall. 

Mr. Hamilton. Well, did you ever hear Mr. Parr say anything about 
contributing AMPI money to Mr. Mills? 

Mr. TowNSEND. Contributing AMPI money ? 

Mr. Hamilton. Yes. 

]\Ir. TowNSEND. No, sir, not that I recall. I sure don't. 

Mr. Hamilton. OK. I have one more set of contribution questions, 
and then I will let Don ask you some questions about the same thing. 
Do you recall receiving $5,000 in cash from Mr. Stuart Russell ? 

Mr. TowNSEND. Yes. 

Mr. Hamilton. When was that? 

Mr. Vanet. Excuse me. 



7094 

This doesn't have anything to do with the 1972 Presidential cam- 
paign, does it? 

Mr. TowNSEND. No. 

Mr. Hamilton. Well, I would like to get into it. 

Mr. Vanet. Get into it? There's nothing to get into. If he. says 
clearly it doesn't have anything to do with the 1972 Presidential cam- 
paign, then it is beyond the scope of the authority and inquiry of this 
committ^^e, and he could testify about things for weeks that lie knows 
about, but I'm not going to let him testify to anything outside the 
scope of the inquiry. Anything within it, I would be glad to have him 
testify to. 

INIr. IIamiltox. I think we have a right to inquire about the circum- 
stances of this and then make our own judgments. I mean, if we let wit- 
nesses spoon feed us, so to speak, and counsel, we wouldn't have gotten 
a heck of a lot of the information we have gotten. 

ISIr. Vanet. Well, that might be. But you can ask him questions about 
hundreds of things that are outside of the authority on the pretense, 
well, we want to hear about it and then we will decide if it is relevant, 
and that is going beyond your 

ISf r. Hamilton. I think the determination of relevance is up to the 
staff and the Senators and, you know, we can go back for another ruling 
of Senator Inouye if you want, but I don't think we're going to ask him 
about hundreds of things. We're going to ask him about a few specifics, 
and we do have some information that there was a $5,000 delivery 
of money from Mr. Russell to Mr. Townsend. 

We just want to find out what it is about, because Ave know that 
]\f r. Russell was involved in some other matters involving Presidential 
campaigns. 

I think it is a very fair question. We're not asking a blind questdon. 

INIr. Vanet. Well, is this the same time period as 1970 and 3971? 

Mr. Townsend. Yes ; it's in this time period. 

Mr. Vanet. "What you are saying is, you have infomiation that it 
may well be that he was obtaining money not for himself but for a 
Presidential candidate? 

INIr. Hamilton. Well, I don't want to state it too strongly. We know 
that there was some transferral of money ; we know that Mr. Russell 
was involved in transferral of money for Presidential campaigns. 

INIr. Vanet. This is already of record ? 

Mr. Hamilton. Yes. And because of those two facts, we would just 
like to inquire into this. 

Let me say I don't think that this interrogation this morning is 
going to be that sweeping. I don't think we're going to spend 5 or 6 
hours going into every conceivable aspect of ISIr. Townsend's affairs. 
I don't think you have any worry about that. 

INIr. Vanet. Well, I can see where there would be relevancy if there 
is some possibility it could have been not for him but for someone else. 

Go ahead, Tom, and answer. 

Mr. Townsend. Go ahead and answer ? 

Mr. Vanet. Yes. 

Mr. Townsend. I forgot the question. 

Mr. Hamilton. The question was whether you received some money, 
I believe, and you said yes; and then I asked you what was the tame 
frame. That is as far as we have gone. 



7095 

Mr. TowNSEXD. I am going to say September 1970. If I could look at 
my calendar, I could pinpoint it. 

Mr. Sanders. I am looking: at 1971 here. I will have to dig out 1970. 

Mr. TowxsEXD. T would say it's on September 17, 1970. 

Mr. Hamiltox. How about describing the circumstances surround- 
ing this delivery of cash, the amount, the reasons for it, et cetera. 

]Mr. TowxsEXD. Could T confer Avith counsel for a minute ? 

]\Ir. Hamiltox^. Sure, please. In fact, if you want to step outside 

Mr. TowxsEXD [confers with counsel]. I was attending a board 
meeting of the Oklahoma divison board of directors of AMPI, and I 
called the office, my office in Little Rock, to see if there were any mes- 
sages. There was a message for me to call Page Belcher at his office 
in Tulsa. 

I called that office some time in the afternoon, as I recall, and talked 
to Page, and I think we talked probably about the weather and foot- 
ball, and I asked if there was anything I could do. And he said, "yes; 
I would like to have $5,000." 

And I said, "Fine, I feel sure that I can make a call and get a check 
sent today." And Mr. Belcher said, "No ; I would like to have it cash." 

And I said, "Well, I don't know if I can do that. I will have to make 
a couple of calls and call you back." And he said, "OK." 

And so then I called Mv. Parr, told him the circumstances, and Mr. 
Russell's name came up in the conversation. And I believe I said some- 
thing like, "Do you want me to call Stuart Russell?" and he said 
"Yes." 

So I called Mr. Russell, who was in Oklahoma City. He was in his 
office. I told him that I would like to have $5,000. He was somewhat 
i-eluctant. He asked who it was for. I said "for Page Belcher," and he 
asked who had authorized it, and I said "Dave." And he said, "OK, 
drop by the office." And I said. "OK, I'll come by this afternoon." 

And then I called Page Belcher back and asked if he would be in his 
office. I said it would probably be a little bit after 5 o'clock by the time 
I got over there. He said he would wait on me. 

After the Oklahoma board meeting was over, I went down to Stuart 
Russell's office. He had a client with him. I talked to his secretary. His 
secretary" lianded me an envelope. I took the envelope and went out to 
the airport, got my plane, went over to Tulsa, took the envelope down 
to Page Belcher's office, gave it to Page. It was a little bit after 
5 o'clock, as I recall. I don't believe there was anybody in the Federal 
Building, at least not very many people. 

And he said, "Thanks, Tom," and took the envelope and put it in a 
coat pocket, and then Ave Avalked out of the building together. As I re- 
call, it Avas Mr. Belcher and a long-time administrative assistant who 
since has died. And I got in a cab, Avent back to the airport., and w^ent 
back to Little Rock. 

At — oh, I would say about 4 months ago when I first — I don't knoAv 
Avhat time period, 8 or 4 months ago, when I first heard this — I mean, 
lieard of Stuart RusselFs name coming up in terms of some other 
contributions, I asked advice of my attorney, and told him about 
this situation, and he suggested that it might be a good idea to go to the 
district attorney, go forth and volunteer this information. 

And I said, "Well, that will be fine. Let me consider that." And I 
talked to — at about that time, I talked a couple of times with him and 



\ 



7096 

sugffOvSted that it mi^ht be good not to have the same attorney as cor- 
poT'ate counsel, that is how I got in touch with Randy Vanet, and 
talked to him about it, and he thought that it would probably not be 
best to do so. 

T talked with Stuart Russell about it. and he said he didn't care 
one way or the other, that the money was all his own personal, it didn't 
have anything to do with x\MPI, and he didn't care whether I went 
forward with the information or not. 

And on the advice of counsel, I did not go forrs-ard with that in- 
formation to the IT.S. Attorney's office. 

Mr. Sanders. Can we take a 5-minute break, please ? 

Mr. Hamilton. Sure. 

[A brief recess was taken.] 

Mr. Hamilton. I only have one more question on this matter, and 
that is, Mr. Townsend,' in regard to the $5,000 delivery from Mr. 
Russell to you to Mr. Belcher in 1970, have vou got any information 
that this money was used in support of any Presidential candidate, in 
the 1972 campaign or election or any proceeding or any campaign or 
canvass leading up to 1972 ? 

Mr. Townsend. Xo : I do not. 

Mr. Hamilton. OK, Don. 

Mr. Sanders. I assume, from the way you have phrased your an- 
swers, INIr. Townsend. that your $50 check for Mills was given prob- 
ably just shortly before you brought this envelope to Washington for 
Parr? 

Mr. Townsend. No; I am not sure of the date of that check. I think 
I said I am not sure whether it was included in that group or not. It 
mav have been. 

INIr. Sanders. Coidd vou tell us the circumstances of your making 
that contribution to Mills? Were you solicited by Parr? 

Mr. Townsend. Yes; I believe T was solicited by Mr. Parr, and I was 
happy to make a contribution. 

Mr. Sanders. Was it payable to the Mills Campaign Committee to 
the best of your recollection ? 

Mr. Townsend. The best I can recall, it was made out payable to 
the Draft Mills for President campaign. 

Mr. Sanders. Did Parr suggest an amount to you ? 

Mr. Townsend. I don't recall that he did, but he may have. I just 
don't recall. 

INIr. Sanders. Were you aware that he was soliciting other AIMPI 
employees at that time ? 

Mr. Townsend. T have no personal knowledge of anyone else that 
made a contribution to that campaign. 

Mr. Sanders. Were you aware that he was making calls around to 
AMPI board members and other emploveos to solicit contributions for 
Mills? 

Mr. Townsend. You know, I have difficulty in terms of the time 
frame. I have heard that that was done. I am not sure that I knew 
about it at the time that he talked to me about it. I don't believe that I 
personally have heard him ask any other employee or any Iward mem- 
ber, but i wouldn't be surprised if other employees were asked, yes. 

Mr. Sanders. Well, have you at any time been told by other AMPI 
employees or board members that they were solicited by Parr? 



7097 

INIr. TowNSEND. I doivt recall a board member mentioning it to me. 
I think probably one or two employees have. I think probably — shoot. 
I am thinkino; that maybe Joe jMiirphy mentioned this to me, but I am 
jnst not absolutely certain. 

;Mr. Sanders. Did you ever learn of any AINIPI employee or board 
member complaining that Parr had coerced them to make a con- 
tribution to ]\Iills ? 

Mr. TowNSEXD. No, sir. 

INIr. Sanders. Did you receive from AMPI any reimbursement for 
your contribution? 

Mr. TowNSEND. No, sir. 

Mr. Sanders. Did you in any way enter that into your expense 
account ? 

INIr. TowNSEND. No, sir. 

Mr. Sanders. Have you at any time learned that any contributions 
by other AMPI employees were reimbursed by AiNIPI contributions 
for Mills? 

Mr. Vanet. You're talking about during this same time frame ? 

Mr. Sanders. 1971, 1972. 

Mr. Tow^NSEND. I don't recall any conservations along that line. 

Mr. Sanders. Perhaps you have stated this in your previous testi- 
mony, but I would like to ask you where you were officed in 1971. 

;Mr. TowNSEND. In Little Rock, Ark. 

Mr. Sanders. During the entire year? 

Mr. TowNSEND. Yes. 

Mr. Sanders. Did you have any sort of an office in San Antonio? 

Mr. Townsend. No, sir; I did not. 

]Mr. Sanders. During the year of 1971, did you consider that you 
were responsible most directly to Parr? 

Mr. Townsend. INIost directly, yes. I think there were probably 
some — most likely there were some projects that ]VIr. Nelson asked me 
about that I would have reported directly to Mr. Nelson, but for the 
most part I i-eported directly to ]\Ir. Parr. 

Mr. Sanders. "Were there any printed or handwritten or letter mark- 
ings on the envelope which Parr gave you to take to Goss ? 

Mr. Townsend. I don't recall anything being on the envelope. Gosh, 
there might have been some writing on the envelope, but I just don't 
recall if there was or not. 

Mr. Sanders. Was this delivered to Goss in his office ? 

Mr. Townsend. Yes ; it was. 

Mr. Sanders. Was anyone else present? 

Mr. Townsend. Not that I recall. 

INIr. Sanders. In all of 1971 , did you deliver to Goss any other en- 
velopes or packages which were indicated to you to contain any checks 
or cash? 

Mr. Townsend. Yes. 

INIr. Sanders. On how many other occasions ? 

Mr. Townsend. One other occasion. I brought nn envelope which I 
was told contained some checks to Washington. 

JMr. Sanders. Who gave it to you and what was said to you ? 

INIr. Townsend. To the best T can recall, Mr. Parr gave it to me ; and 
he said it was some checks for Mills' campaign. 

Mr. Sanders. Did he say how nuich was in it ? 



7098 

Mr. TowNSEND. No, sir. 

Mr. Sanders. Was it also sealed ? 

Mr. TowNSEND. Yes, sir. 

Mr. Sanders. Was it similar in description and size to the previous 
envelope you explained ? 

Mr. TowNSEND. I believe it was a manila envelope rather than a 
white, letter-size envelope. I believe it was an envelope that probably 
would have been 814 by 11 and thin. 

Mr. Sanders. Did you deliver it to Goss ? 

Mr. TowNSEND. To the best I recall, yes. 

Mr. Sanders. Was this before or after the first one you have 
mentioned? 

Mr. Townsend. I just honestly don't — I believe it was after. 

]\Ir. Sanders. All ricrht. Noav, have you at any time learned the ap- 
proximate value of tlie contents of that enevelope ? 

Mr. Townsend. No, I have not. 

Mr. Sanders. Did you have any occasion to open it ? 

Mr. Townsend. No, sir; I did not. 

Mr. Sanders. Did you personally deliver it to Goss ? 

Mr. Townsend. I believe I did. 

]Mr. Sanders. Did you observe him opening it ? 

Mr. Townsend. No. 

Mr. Sanders. Do you know what he did with it ? 

Mr. Townsend. No, I do not. 

Mr. Sanders. What conversation did you have with him when you 
gave it to him ? 

Mr. Townsend. To the befst I can recall, it would have been something 
like, "Dave asked me to drop this off to y'all," and he probably would 
have said. "OK, thanks.'' And that would have been the extent of the 
conversation. 

Mr. Sanders. Did Parr make any mention to you of cash in the 
envelope ? 

Mr. Townsend. No; as a matter of fact, I believe that he probably 
would have said checks, because I sure had the distinct feeling that it 
was all checks. 

INfr. Sanders. Can vou place this into anv time frame in reference 
to the Mills' rally in Little Rock ? 

Mr. Townsend. I really can't. I can't tell you whether it wo\dd have 
been before or after. I think probably after, but I'm just not certain. 

Mr. Sanders. To your knowledge — I should say, to your recollec- 
tion — did you deliver any package to Goss in 1971 which contained 
solely cash ? 

Mr. Townsend. No, sir. 

Mr. Sanders. It is my understanding that ]Nfr. Parr has a walk-in 
vault in his Little Rock office. Is that true ? 

Mr. Townsend. It's in the Little Rock office, there is a walk-in vault ; 
yes, sir. It wasn't in INlr. Parr's office. 

Mr. Sanders. It wasn't in his office. OK. 

Mr. Townsend. No. 

Mr. Sanders. Were vou aware in 1971 of any sums of cash kept in 
there by Parr of $1,000 "or more ? 

Mr. Townsend. No, sir; to the best of my recollection, that vault 
contained only lecords, and I don't recall ever walking by that vault 
door when it wasn't wide open. 



7099 

Mr. Sanders. Was there within it any other smaller safe or locked 
box Avitli a combination or key lock? 

Mr. TowxsEXD. Not that I recall. 

Mr. Sanders. At any time in or about August 1971, did you learn that 
cash had been delivered to Norma Kirk at the Little Eock aii*port? 

Mr. TowxsEND. No, sir. 

]\rr, Sanders. Or did you learn that Norma Kirlc had brought cash 
into the office to Parr in A ugust ? 

Mr. Townsend. No, sir; 1 have no recollection along that line. 

Mr. Sanders. Did you have any knowledge that Parr was keeping 
any cash, any cash sums, in that vault for Wilbur ]Mills ? 

Mr. Townsend. No, sir; well I would be just completely surprised 
if there were, because, as I say, I just don't recall ever walking by that 
vault door when it wasn't wide open. 

Mr. Sanders. Do you have any recollection that Bob Lilly came to 
Little Rock any time around the jNIills rally ? 

]\fr. Townsend. I don't remember seeing Bob Lilly around in Little 
Rock at that time, but I don't recall seeing Bob Lilly — I just don't 
recall seeing Bob Lilly in Little Rock, period. 

Mr. Sanders. Your calendar indicates the words "Mills rally" on 
August 26, 1971. 

Would that indicate to you that was the day of the rally ? 
Mr. Townsend. I would assume that it was. I would think that 
would be the day. 

Mr. Sanders. Now, it is my information that Lilly traveled to Little 
Rock on August 17, 1971. ' 

Does your calendar contain any notations on August 17 which 
would stir your recollection of that day ? 

Mr. Townsend. No; I would say I Avas in Little Rock on that day. 
I indicate that there was a hearing in the Twin Cities, ]Minneapolis- 
St. Paul, but I don't recall going to that. 

Mr. Sanders. Is that a milk hearing? 

Mr. Townsend. Yes, it would have been a milk hearing. 

IVIr. Sanders. Although you have no recollection of attending it, 
does the notation indicate that you did attend? 

jNIr. Townsend. No, I just said my notation says that there was a 
hearing on voting on diversion limitations and lowering supply })lant 
requirements and also location differentials. I don't recall whether I 
was at that hearing or not. 

Mr. Sanders. Is there any indication from your calendar that be- 
tween August 17 and August 26 you traveled to Washington ? 

]\Ir. Townsend. No, sir. I would say — well, let me look. I feel rela- 
tively certain that I did not. Sometimes I have notations on this cal- 
endar which I've never followed through, or notations for Dave, or 
as a reminder of some kind of a meeting which I did not attend. For 
instance, just on the 16th. I have got Nelson, Parr and others, North 
Holiday Imi at St. Louis. I went to that meeting. 

I sometimes have notations on here where l;didn't go to the meeting 
at all. I think this, in combination with my expense account, gives a 
real accurate indication of where I was. But from looking at this, I 
would say I did not go to Washington between August 16 and through 
the end of Aufi-ust. 



7100 

Mr. Sanders. It is my understanding that tliere was an office in 
Little Rock whicli was handling responsibilities for the Mills rally. 

Mv. T(^wxsEXD. Yes, sir. 

Mr. Sanders. Do you recall that office ? 

Mr. TowNSEND. Yes, I do. 

Mr. Sanders. Were you ever in that office ? 

Mr. TowNSEND. Yes, I think I was there probably twice. 

Mr. SANra:RS. You said you were acquainted with Charles Ward? 

Mr. TowNSEND. Yes, I've met Charles Ward maybe three times. 

Mr. Sanders. Do you also know an individual named Jernigan who 
served as treasurer? 

]\Ir. TowNSEND. I believe I met Mr. Jernigan maybe twice. I don't 
know Mr. Jernigan well at all, or Mr. Ward well at all, either. 

INIr. Sanders. Did vou ever take any envelope or package from the 
AMPI Little Rock office to the Little Rock office for the rally ? 

Mr. TowNSEND. Not that I recall. I sure don't recall doing so, and 
I think if I had I think I would remember it, but I don't have any 
recollection of doing so. 

]Mr. Sanders. At the time, on the occasion that you took the two 
envelopes to Washington, D.C., to Goss that you have already told 
us about, to your knowledge, was there any office in Little Rock oper- 
ating for a INIills' Presidential candidacy? 

The reason I ask you that, is because I want to know if it went 
through your mind to wonder why you were making the delivery all 
the way to Washington, if there was some local operation that it could 
have been given to. 

Mr. TowNSEND. I don't recall any office in Little Rock in that 
regard, other than this Mills rally office. 

Mr. Sanders. Did that close up right after the rally ? 

Mr. TowNSEND. It surely must have been shortly after, l>ecause I 
remember driving by the office, I don't recall when, but it was all open. 
The office, as best I recall, was on a corner of a main street in down- 
town that had windows completely along two sides of it, and I believe 
the office had been vacant for some time, and I don't think that it was 
open for very, very long. 

Mr. Sanders. You have no recollection of a Little Rock Draft Mills 
office? 

Mr. ToAVNSEND. A Little Rock Draft Mills office ? 

Mr. Sanders. Yes. 

Mr. TowNSEND. No, sir ; I do not. 

Mr. Sanders. Since the committee questioning concerning any 
travels to Washington carrying any checks or cash for Mills, have 
you perchance had occasion to review or search your logs to see if 
you could match any trips to Washington with those occasions of 
delivering them ? 

Mr. TowNSEND, No, sir; I have not and I kind of doubt— I think 
it would be rather fruitless on my part to try to do so, because I came 
to Washington quite a fcAv times. And I think befoi-e making the 
copies that T looked through there, and I just don't think that there is 
anything in there that would shed any liglit on that time period. 

Mr. Sanders. In your calendar for July of 1971, th(u-e is a note at 
the beginning, ISIills-Kennedy. 

A'NIiat is the siiniificance of that ? 



7101 

Mr. TowxsEXD. I think probably I had my calendar out the first 
time that I heard the names of Mills and Kennedy as a possibility on 
the Democratic ticket, and I suspect that I was just doodling and 
wi'ote down the names, Mills-Kennedy. 

Mr. Sanders. On July 24, there is an entry, "Ark-Div,'' Arkansas 
Division, I presume, "Mills, Conway," which I assume is Conway, 
Ark. 

Do you know the significance of that entry ? 

Mr. TowNSExn. Could I look at it? [Pause] I believe this was a 
time period when the southern region of AMPI had its normal yearly 
division meetings, and I would say that on the 24th of July 1971, that 
the Arkansas division had their annual division meeting in Conway, 
Ark., and that Chairman Mills was the speaker at that meeting. 

]Mr. Sanders. Would having the meeting in Conway be an ordinai-y 
event, or would that be unusual ? 

Mr. TowxsEXD. That would be very ordinary. I have attended three 
Arkansas division annual meetings; they were all held at one of the 
colleges there at Conway, Ark. And I know that last year, I received 
an invitation to go, and it was also held at Conway. 

Mr. Sanders. An entry for July 30 says "Washington." 

Would that indicate tliat you were in Washington on that date? 

Mr. TowxsEND. Yes, sir. 

Mr. Saxders. Do you know for what purpose ? 

Mr. Towxsexd. I would not have any idea. Sorry. 

Mr. Saxders. And the entry for July 31 says, "Mills, January 14, 
San Antonio." Is that correct ? 

JNIr. Towxsexd. Yes, that's correct. I believe that is probably the 
fii'st time that I heard that Chairman Mills was to make some kind 
of a speech before some group in San Antonio, on January 14. 

Let me look back at the end. I think I also wrote it — yes, in Decem- 
ber, which is the last entiy, on a little blank spot. I also have "Mills, 
January 14, San Antonio." 

I am quite sure he was to speak before some civic group on Janu- 
ary 14 in San Antonio. I don't know if it ever took place, but I fe^d 
sure it was scheduled. 

Mr. Saxders. The entry for August 3 says "Washington." 

Do you know for what reason ? Did you travel to Washington that 
day, and do you know for what reason ? 

Mr. Towxsexd. I would say I did travel to Washington on that 
day, and I don't have any idea why. I did quite a little work in Wash- 
ington in terms of, you know, working with various — oh, gosh. Agri- 
culture people, and I was kind of in charge of the development of 
white papers in terms of price suppoi-ts, imports, the economic justifi- 
cation, and background, that kind of stuff. And I think if — you know, 
looking through my old calendars, you could say I came to Washington 
quite often. I woulcl say that I was in Washington on that day. 

Mr. Saxders. An entiy on August 25 says, "Butterbrodt." 

Do you know the reason for that entry ? 

INIr. Towxsexd. Xo, I really don't. It could be that I was supposed 
to call Jolni Butterbrodt on that day, I would say that would be the 
most likely, but I am not positive on that. 

Mr. Saxders. Did you have occasional business dealings with him? 

Mr. Towx-^SEXD. Yes, I did. 



7102 

Mr. Sanders. Just to take it a little beyond the period of the Mills 
rally, your calendar indicates in September that perhaps you were in 
Washington for several days, the first full week of that month. 

Mr. TowNSEND. Yes, sir ; I would say that I was. 

Mr. Sanders. For what dates would you judge ? 

Mr. TowNSEND. I was there on September 8, 9. and 10. I possibly 
came in on the 7th, or possibly stayed over and came home on the 11th. 
I feel relatively certain that I was out of or away from my home for 
3 days that week, 8 nights. 

Mr, Sanders. Can you tell from that why you were here? 

Mr. TowNSEND. No, I cannot. I can't tell from this. 

Mr. Sanders. Do you now know why you were here ? 

Mr. TowNSEND. No, I don't recall. 

Mr. Sanders. Jim, I have got a few more qiiestions I want to ask, 
but I assume you're going to go back into tlie Iowa rally. I will get 
into that when it comes up. 

For the month of November 1971, your calendar indicates San 
Antonio on the 10th and 11th. I see no indication here of Austin. Can 
you refresh your recollection for the 10th and 11th ? 

Mr. TowNSEND. On the 

Mr. Sanders. 10th and 11th. 

November 10 is the Marine Corps birthday, in case you Avant to 
put a reference on that. 

Mr. Vanet. a little trivia. 

Mr. TowNSEND. I can't remember whether I was in San Antonio on 
the 10th and lltli or not. I believe that I was in there on the lltli. I 
am not sure about the 10th. I also have a notation of a supply and man- 
agement committee meeting in Dallas on Novem])er 10. 

I also see that there were Canadian peo])le in San Antonio on the 
11th and 12th. I believe that Jim Reeves talked to tlie Canadian people 
in San Antonio, or Dr. Mehren, or maybe l)otli. I know tliat I did not 
talk to the Canadian people who were in San Antonio. 

My expenses would indicate that I was probably in San Antonio on 
the 11th anyway. I don't recall. 

Mr. Sanders. Can you possibly relate to the lOtli and 11th the evonts 
you have told us of meeting Lilly in the Austin Airport? 
Mr. TowNSEND. No ; I really can't. 

Mr. Sanders. The reason I asked that is, it is our information that 
it was on November 10 that Lilly met you, or saw you, in the airport 
with other AMPI personnel. 

Mr. TowNSEND. It could have been, but it sure doesn't riiig a l^ell. 
There just isn't an>i:hing about that Austin Airport deal that really 
rings a bell with me, or I am sure I would remember it. 

I am not saying that it wasn't on that day. I am just saying that I 
just — I don't have any— I can't help in terms of that date. 

Mr. Sanders. Now, with respect to your remarks about being in 
Austin with Parr whenever the date was, on that occasion, would you 
have flown to Austin with Parr? 

Mr. Townsend. Yes, sir. 

Mr. Sanders. Did he make any mention to you on the way that he 
was to receive anything from Jacobsen ? 

Mr. Townsend. No, sir, not that I recall. The only thing I can recall 
is, I think what I said earlier was that he said he wanted, if Ave were 



7103 

going to stop in Austin, he wanted to talk to Jake a little bit. And I 
think it was purely accidental that Bob Lilly was there — purely 
accidental. 

Mr. Sanders. Do you recall, then, flying from Austin to San 
Antonio ? 

JMr. TowNSEND. I am not positive where we went from Austin. I 
think it was to San Antonio, but I am just not positive. 

Mr. Sanders. In relationship to that occasion, were you at any time 
thereafter given any package or envelope by Parr to deliver to any 
Mills personnel ? 

Mr. TowNSEND. You mean like immediately after ? 

Mr. Sanders. I mean, within the same day or within a few weeks ? 

Mr. TowNSEND. Oh, certainly, not on the same day, and nothing that 
I could ever tie back to that Austin stop, 

Mr. Sanders. Well, now, just — this was November 10. Well, I am 
saying we were told November 10. You don't remember that it was 
that date. But within about 60 days thereafter, there was a complete 
change of management in AMPI. 

Mr. Townsend. Yes, sir. 

Mr. Sanders. At any time betwee-]! your seeing Lilly in the Austin 
Airport and the time of change of management in AIMPI, did you 
deliver anything to Washington for Mills ? 

]\fr. Townsend. Well, I think — as I say, I can't tie any time periods 
in terms of delivering to Washington, so it may have been after No- 
vember 10 ; it may not have been. We could look at the calendar and 
see how many times I was in Washington after that. 

Mr. Sanders. Your calendar indicates Washington on November 16, 
Washington on November 23. Maybe you could do a better job of 
covering the next month there than I can. There might be some- 
thing besides "Washington" that would indicate that you went to 
Washington. 

Mr. Townsend. Yes. T would say I did come to Washington on the 
23d of November. 

^Ir. Sanders. Also on the 16th? 

IMr. Townsend. Also on the 16th of November. [Pause.] 

This woidd indicate that I did not come to Washington the entire 
month of December. But, again, I think it would be good to look at the 
expense reports. I don't believe T did come to AYashington in December 
1971. 

Mr. Sanders. Or January 1972? 

Mr. Townsend. No ; not in January of 1972. 

Mr. Sanders. x\nd you don't know the purposes for vour trips on 
November 16 or 23? 

INIr. Townsend. No ; I i-eally do not. 

Mr. Plotkin. I don't believe Mr. Sanders asked 3'ou, with regard to 
the second envelope that you gave Gene Goss in Wasliington, was that 
delivery in his Capitol Hill office? 

Mr. Townsend. To the best I recall, it was, yes. 

Mr. Peotkin. Was thei'e anyone else present in the room at the time, 
or that might have been present and was sent out of the room? 

Mr. Townsend. Oh, thei-e was no one sent out. I don't remember 
anything i:)eculiar about it. Gene Goss' desk is separated by a^ — at that 
time, it was separated by a partition, and I believe it most likely that 



7104 

I ^Y0^1d have just gone back and I would have been the only one 
behind this little partition. It was, oh, 5 feet hio^h. 

]\Ir. Plotkin. Is there a secretary that sits on the other side of the 
partition ? 

IVIr. TowNSEXo. On the other side of it, yes. 

Mr. Plotkix. Was she there when you came in ? 

Mr. TowNSEND. Oh, ^osh, I can't remember. 

Mr. Plotkix. If she was there when you came in, do you think she 
miofht have overheard any conversation you might have had with Mr. 
Goss? 

Mr. TowxsEXD. Oh, I doubt it, I think she probably would have been 
typing letters. 

Mr. Plotkin. OK. You also said that you were pretty sure that the 
envelope contained checks ? 

Mr. TowxsEXD. Yes. 

l\Ir. Plotkix. What causes you to think that? 

Mr. TowxsEXD. I think INIr. Parr said that there were some checks. 

Mr. Plotkix. Did he say they were all checks, or did he say there 
was no cash, or did he say, "Here are some checks?" 

INIr. TowxsEXD. I don't remember. I feel relatively certain it was 
after that first time that I felt that there was some cash and some 
checks in the envelope, and I know I felt on the airplane a little bit 
apprehensive in terms of the cash. And I know that I didn't feel anv 
apprehension in terms of this second time, because I, in my own mind, 
felt that they were all checks made out to the Draft Mills for Presi- 
dent Committee. 

Mr. Plotkix. But in fact you don't know there was 

Mr. TowxsEXD. 'No; I didn't look in the envelope for a fact. I 
couldn't verify that there were cash or checks in either one of the 
envelopes. 

]Mr. Plotkix. So then it's just as possible that it was cash in that 
second envelope as there was in the first one ? 

Mr. TowxsEXD. It's possible that there was cash. 

Mr. Plotkix. All right. That's all. 

Mr. Hamiltox. OK. I want to get on to a few- other subjects, and I 
will move as fast as we can. 

I want to focus on 

INIr. TowxsEXD. We just missed the airplane I really wanted to 
catch. 

Mr. Hamiltox. I want to focus on this rally in Ames, Iowa, on the 
2d of October. Your calendar indicates that you were out in Iowa a 
couple of weeks before that. Now, what were you doing out there? 

Mr. TowxsEXD. I was in Iowa to help whatever I could to try to 
get a crowd for the Iowa Cooperative. 

Mr. Hamiltox. Why was it so important to get a crowd ? 

Mr. TowxsEXD. Well, I think there was a couple of reasons. One, 
Iowa has been messed up in the dairy industry ever since I have been 
in the dairy industry. It has been a rather noncooperative area. It has 
been a low-priced area, and we wanted to try to get a crowd, get people 
together and see if we couldn't develop some more cooperation. 

And then I think, too, I knew that Chairman ]\Iills was going to be 
one of the speakei-s at that meeting, and anything I could do to help 
Chairman Mills I would be happy to do. 



I 



7105 

]\rr. ITAivriLTox. Was tliat the ofRcial position of AINIPI, "Tvct's help 
Chairman Mills"? 

Mr. ToAvxsExn. T don't know as I would say it was the ofRcial posi- 
tion of A]\IPI. I think that may be an nnofRcial position or some- 
thinoj of — any time that we could do anything; for Chairman Mills 
that was, yon know, honest and legitimate, I tliink that we would make 
every effort to do so. 

Chairman Mills, at least in my opinion, has probably more knowl- 
edo-e than any other sin.e:le individual on the Hill in tenns of the dairy 
inclusti-y and some of tlie technicalities of tlie dairy industry, including; 
Federal oi'dei-s. And lie was lielpful to us in terms of the dairy indus- 
try, and, at least T felt that any time there was anything we could do 
that would he lielpful to Chairman INIills, that it would be done. 

Mr. ITa]miltox. Let me be a little more specific. Was it your view, 
and was it the general perception of the people at AMPI, to your 
knowledge, that tlie Ames rally was at least in pait a Mills for Pres- 
ident rally? 

Mr. TowxsEXD. I can't speak for othei's, but I felt that the primary 
purpose was the Towa Cooperative, the milk thing, but it was an oppor- 
tunity for iNIills to appear in Iowa. 

Mr. ITamiltox. l^ut you perceived it as a vehicle to promote Mills' 
candidacy ? Is that correct, or is it not correct ? 

Mr. TowxsEXD. Yeah, I guess I ])erceived it as 

Mr. IIamii.tox. Do you think INIr. Pan- perceived it as that way? 

Mr. TowxsEXD. Gosh, I wish you would ask Mr. Parr that question. 
I would think that he would have perceived it as an opportunity to help 
Chairman Mills ; yes. 

IVIr. Ha^niiltox. How about Mr. Nelson ? 

INIr. TowxsEXD. I would say the same with Mr. Nelson. 

ISIr. Hamiltox. And Mr. Johnson, Joe Johnson? 

Mr. Tow^xsEXD. I would think that probably INIr. Johnson — I don't 
know whether Joe Johnson would have thought of it in the same — 
I don't know ; maj'be a lesser degree or something. 

INIr. Hamietox^ Well, take Parr and Nelson. Did either one of these 
gentlemen say anything to you indicating that they perceived this as 
a Mills for President rally tliat you can now recall ? 

Mr. TowxsEXD. I don't recall any specific instances where it was 
said that this would be a INIills for President rally. 

Mr. Hamiltox^. Well, did you ever help prepare, or was there pre- 
pared, cam]xaign items to promote Mills' candidacy that were distrib- 
uted at the Ames rally ? 

For example, were there balloons that said "Mills for President," or 
was there a banner? Was there Mills for President literature available 
there? 

Mr. ToAvxsEXD. I was not at the rally and I just honestly don't know. 

Mr. Hamiltox. You weren't there ? 

Mr. Towx'^sEX'D. I was not there ; no, sir. 

Mr. HAMIET0x^ Well, how shortly before the rally did you leave? 
Do you remember ? 

Mr. TowxsExn. I don't have anything on here that indicates when 
that rally was held. Was it on October 2 ? 

Mr. Hamiltox^ Tlie 2d, yes. 



7106 

Mr. Townsp:nd. I think tliat I was there on September 80 — that 
would have l^ecn tlie last day. T tell yon. all dnrinc; 1971 and the^ — let's 
say from Tlianksoivinof of 1970 on thron^rh ahnost all of 1971 was an 
extremely tryino- i^eriod of time for me. My wife was in an extremely 
depressed situation, to the point tliat I liad to liavo my mother come 
down and take care of my children alon^ about Thankso;ivin(? of 1970 
throuoh, I think — after Easter of 1971. And from that period on I tried 
to be home a g;reat deal more, and it was constantly on my mind. 

And, as a matter of fact, I think on September 30, T — probably I got 
a call indicatino; that I sliould fret liome right fast, and I w^ent home 
that night and stayed there and did not go back for the rally itself. 
And I will just be honest M'ith you, that was very much on my mind, 
and it still is. It's a period of time that I will never forget. It is, I think, 
a ]oeriod when I finally realized what some of the important things in 
life really are. 

I think I was a pretty mixed-up kid for quite a while, and I think it 
is unfoitunate that it took that to get some proper perspective in my 
own personal life. 

I'm sorry I digressed on that. 

Mr. Hamiltox. That's all right. 

Mr. Tow^NSEND. But it would indicate — my records would indicate 
that I Avas in Iowa. 

Mr. Vankt. I think, Tom, you answered the question about 10 min- 
utes ago, but if you want to miss your next plane, you can just keep 
talking. 

Mr. Tow^xsEND. Thank you, counsel. 

I was just going to say it looks like I was in Iowa about 3 days the 
WTek of September lo. 2 days the week of September 20, and either 
2 or 3 days the Avcek of September 27, and that was the extent of my 
invoh^ement in Iowa. 

INIr. Ha:miltox. AVell, w^hile you were there, did you see anybody 
blowing up Mills balloons ? 

Mr. Tow^x-SEXD. No. sir, I did not see anyone blowing up Mills 
balloons. I recall that there were some banners being made. I don't 
know^ what the baniiers said or how large they were. T don't recall any- 
thing about balloons. 

Mr. Haimiltox'. Well, that may sound like a tri^nal question, but the 
point is, how much was this rally focused toward elect ijig Wilbur Mills 
President? That is the overall question. Do a'ou know how much money 
AMPI put into thi s rally ? 

Mr. Tow^xsExn. I wouldn't have any idea. 

Mr. Hamiltox. I take it there were contributions by the other dairy 
cooperatives, too? 

Mr. TowxsEX'D. I don't think there were any contributions in terms 
of any cash, at least none that I am aware of. I tliink that there w^ere 
people that were involved. There were people involved from AMPI, 
from Mid-America Dairymen, from Land O'Lakes Velco di\asion, and 
I believe the Rural Electric Cooperatives, Farmland Industries, and 
probably other cooperatives, you know, that I am just not aware of. 

Mr. Hamiltox. Is it your understnndinq- that the outlays of cash 
that were necessary were made by AMPI? When I say outlays of cash, 
I mean outlavs of money to pay for the — in terms of the expenses. 

JVfr. TowNSEXD. In terms of the 



7107 

]\Ir. Hamilton-. Rontiiio; the hall, et cetera. 

INIr. TowNSEND. No, T am not aware of that. 

Mr, Hamilton. OK. On the trip to Texas for the speech to the 
leo;islature, that was in April, I believe? Can you pinpoint that? 

]\Ir. TowNSEND. I think I did it the 

ISfr. Hamilton. You may have. 

Mr. TowxsENi). Yes, I 'would say it was April 30, 1971. 

IVIr. Hamilton. Now, did you travel down there to the rally with 
Chairman IMills? 

Mr. TowNSEND. To the best of my knowledge, I did, sir. 

Mr. Hamilton. How did you travel ? 

Mr. TowNSEND. l\y a private jet from Little Rock. 

Mr. Hamilton. Was that theAMPI jet? 

Mr. TowNSEND. No, it was not. 

j\Ir. Hamilton. It was a rented jet? 

INIr. TowNSEND. I don't have any idea what the source of the 
plane was. 

Mr. Hamilton. Do you know who paid for the plane ? 

Mr. TowNSEND. No, I do not. 

INIr. Hamilton. And did Mv. Mills travel back to Little Rock on 
the plane? 

Mr, TowNSEND. I am not sure how we got back. [Pause] 

I see a notation of our Project P Committee meeting in the Execu- 
tive Inn in Dallas, and I don't remember- whether Mv. Parr went to 
that Project P Committee, which stands for "promotion," or whether 
we went back to — whether we went back to Little Rock. And I don't 
remember Avhether we went back with Chairman ISIills or whether 
we did not go back with Chairman INIills. 

Mv. Hamilton. I take it. 

jNIr. TowNSEND. My notation shows that we went to the LBJ ranch 
the same day, and I am just not sure of the mode of transportation. 

Mr. Haisiilton. How did this speech to the Texas Legislature come 
about? 

Do you know who made the arrangements? 

ISfr. TowNSEND. I wouldn't have any idea. 

Mv. Hamilton. Do you know if this speech was a device to promote 
Mv. trills' candidacy for the Presidency ? 

Mv. TowNSEND. No, and I'm not sure of the time frame. I'm not 
sure that I was aware in April 11)71 that there would be a Mills for 
President candidacy. I am not sure of the time i)eriod, and I think 
that Chairman Mills spoke to several joint sessions of the legislatures, 
and I think — I am not ]>ositive 

INIr. Hamilton. Do you rememlxr the topic of his speech? 

Mr. TowNSEND. No, I sure don't. 

Mr. Hamilton. Can you remember any facts that would indicate 
t.hnt tliia wns sort of a campaign appearance? 

Mr. TowNSEND. None that I recall, but I am really not a campaign 
advance man or any of that kind of thing. That isn't really the role 
that I played in any way or any advance man for anybody. And 
what may be obvious to some people as something that is very i:)olitical 
might not seem political to me, and pai-ticularly in relating time pe- 
riods — well, it is difficult in the whole line of inquiry to separate 



7108 

what I knew at the time, what I've heard about, what I have read in 
the newspapers. 

Boy, in terms of some of the whole fundins: deaL I have learned 
a lot more since I left AINIPI than I ever knew when I was in AMPI. 

INIr, Hamiltox. T^nt you don't remember any discussion on the plane 
j2:oin^ down as to how this would be a o-reat boost to ^Mills' candidacy 
or anythino- like that ? 

Mr. TowxsEXD. I don't recall. Thei-e may have been some, but I 
don't recall any. 

INIr. Hamiltox. Who was on the plane ? 

INTr. TowxsEXD. To the best I can recall, it would have been two 
pilots — I wouldn't have any idea who they were, because it was not 
a plane that T was familiar with. 

]\Ir. Hamiltox. Who were the passencrers ? 

Mr. TowxsEXD. Chairman Mills, Dave Parr. Carl Arnold, and 
myself. 

INIr. Hamiltox. Why was Carl Arnold on the plane? 

Mr. TowxsEXD. Pardon ? 

]Mr. Hamiltox. VTi^y was Arnold on the plane ? 

]Mr. TowxsEXD. 1 don't know. 

Mr. Haimiltox. He was in Mills' office? 

jNIr. TowxsEXD. Ca rl Arnold ? Not that I'm aware of. 

]Mr, Hamiltox. Whnt was his position, and Avhat was his connec- 
tion with the INIills organization ? 

]Mr. TowxsEXD. I don't have any knowledo-e that he was. He was — 
I think Carl Arnold was an attoriiev here in Washington, and I don't 
know who his clients are or anythincr. 

There may have been somebody else on the plane. There may have 
been one other person. If there was, I do not — it is the first time I ever 
saw him and the last time I ever saw him. 

Mr. Hamiltox. And you can't recall ? 

Mr. TowxsEXD. No. 

INIr. Hamiltox. Don, let me ask just a couple more (questions, just 
to finish up INIills if that's all ri^ht. 

Were vou aware that there were anv AINIPI employees working for 
Mills in 1971 ? 

]\Ir. TowxsEXD. In 1971 ? 

Mr. Hamiltox. Yes. People on the AINIPI payroll working for Mills. 

INIr. TowxsEXD. I knew that Joe Johnson had been an AMPI em- 
ployee and worked for Chairman INIills. I don't know when he switched 
from being an AINIPI employee to a 

Mr. Hamiltox. Well, he was a fully paid AMPI employee until 
January of 1972. Was it your understanding that before that time he 
was working for ]\Ir. ]\Iills ? 

]\Ir. TowxsEXD. Well, I would think he would be working for AMPI. 

]Mr. Hamiltox. What was your understanding at that time ? Were 
you told at that time, or did you know by some means, that he was in 
Washino-ton workimr for Mr. Mills ? 

Mr. TowxsEXD. I knew that he was in Washington. I don't know 
that he was spendine; all of his time working for Mr. !Mills. 

Mr. Hamiltox. That's what I'm asking, your perception. Did you 
have an understandino; 



7109 

Mr. TowNSEND. My perception was that Joe Johnson was in Wash- 
inoton, he was doino; some work for Wilbur Mills, but it was not my 
perception that he was spendin<>: full time working for Wilbur Mills. 

Mr. Haimilton. So it was your understanding he was still doing some 
work for AMPI? 

Mr. TowNSEXD. Yes, sir. 

Mr. Hamilton. Is the same true of Betty Clements, his secretary? 

INIr. TowNSEND. I don't think Betty Clements — to the best of my 
knowledge, Betty Clements was not on the payroll, not on the AMPI 
payroll, after she came to Washington. 

iNIr. Ha:milton. Well, I think she came around November 1971, and 
she was still on the AMPI payroll. Wliat was your perception of what 
she was doing up here ? 

Mr. TowNSEND. Well, I thought that she was — I thought she was 
working for Draft Mills for President campaign. 

Mr. Hamilton. And not doing any AMPI business for Mr. 
Johnson ? 

Mr. TowNSEND. I don't have any knowledge of — I don't recall. I 
didn't think she was on the AINIPI payroll. 

iNIr. Hamilton. So the answer to that is, you did not think she was 
doing any work for AMPI, for Mr. Johnson, after she came to 
Washington ? 

Mr. TowNSEND. No, I don't think — I thought she was, but she could 
very well — could have been. 

Mr. Hamilton. Do you know if any AINIPI employees were sent to 
New Hampshire to Avork for Mv. Mills ? 

Mr. TowNSEND. I believe that there were, yes. 

Mv. Hamilton. And who w^ere they ? 

Mr. TowNSEND. AINIPI employees? I don't know if I can say if I 
know who the AMPI employees were or not. 

Mr. Ha:milton. Neither AMPI employees nor people whose expenses 
were paid by A]\IPI? 

]\Ir. TowNSEND. Joe Johnson was in New Hampshire to my knowl- 
edge. I don't know of any other. 

Mr. Hamilton. What about a fellow named George — last name of 
George, Charles George? 

Mr. TowNSEND. I don't think I know anybody named Mr. George. 

Mr. Hamilton. How about INIr. Holmes ? 

Mr. TowNSEND. Johnny Holmes ? 

INIr. Hamilton. Do you know if he was in New Hampshire? 

Ml-. TowNSEND. I'm not sure whether he was or not. When you 
mentioned that nauie ; he may have been. 

Mr. Hamilton. Do you know of anybody else who was, let's say, 
working for Mr. Mills, either on the AMPI payroll or financed by 
AMPI? 

Mr. TowNSEND. Well, I sure don't recall anv. 

Mr. Hamilton. OK, Don. 

Mr. Sanders. Do you get the feeling that this is like tag wrestling? 

Mr. TowNSEND. I get the feeling that you all are asking me an 
awful lot of questions that I just don't — I may have overheard some 
of these things, but I had no direct contact with 

Mr. Vanet. That's what they're finding out, Tom. 



7110 

Mr. Sanders. You shouldn't infer that we presume that you have 
any knowledge to all of these questions we ask. "We just feel that Ave 
have an oblio^fition to cover the field as lono; as you are here, and if 
you don't know anything about it, that's all you can 

jNIr. TowNSEXD. it makes me feel like there must have been an awful 
lot I didn't know about. 

Mr. Sanders. When you traveled to Iowa to work on makinjj prep- 
arations for the event on October 2, did you do that at the direction 
of Parr? 

Mr. TowxsEXD. Yes, sir. 

]Mr. Sanders. What, if anvthino;, did he tell you Avhen he asked you 
to .c:o up there concernino; Wilbur Mills ? 

Mr. TowxsEND. I viewed my prime role in going to Iowa as to see 
what Joe Johnson was doing, and see if I could hold down — see if 
any money was being expended unnecessarily, not knowing whether — 
with no indication of 

Mr. Sanders. Other than Joe Johnson, were there any AINIPI em- 
ployees besides yourself working in Iowa on arrangements for this 
event ? 

Mr. TowNSEND. Yes, sir. 

Mr. Sanders. Let me say, other than Iowa-based people. 

Mr. TowNSEND. Yes, sir; Terry Shea, Bettv Clements, Robert Radel, 
R-a-d-e-1. 

Mr. Sanders. Is he from Little Rock ? 

Mr. TowNSEND. He is in Little Rock at the present time. At that 
time, he lived somewhere in the Houston, Tex,, area. Those are the 
ones that come to my mind. 

Mr. Sanders. Was any of your work in Ames directed toward gen- 
erating attention to the public that Wilbur ]\lills would be at this 
event ? 

Mr. TowNSEND, I was aware — I don't know that any of my work was 
directed in that regard, I was aware that there Avas publicity being put 
out; I think neAvspaper and radio advertisements adA'ertising the loAva 
Cooperative Month that Wilbur INIills Avould be there, that GoA'ernor 
Ray would be there. I believe Senator Miller was there. I believe all of 
the congressional delegation was invited ; now, I'm not sure who all 
attended. 

Mr. Sanders. Did you have any awareness that advertisements were 
being prepared which would state the INIills Presidential efforts? In 
other words, any bumper stickers saying, "IVIills for President," any 
newspaper adA'ertising? 

Mr. TowNSEND. I don't think there Avas any adA-ertising stating any- 
thing relating to IMills for President. I belieA^e I saw some bumper 
stickers that Avere there, but I don't think they would haA'e been pre- 
pared there, or under 

Mr. Sanders. Did you have any involvement in the preparation of 
any Mills for President advertising ? 

Mr. Townsend. TsTot that I can recall. 

INIr. Sanders. To your knoAvledge, did Joe Johnson or Terry Shea 
have? 

Mr. Townsend. IMills for Pi-esident ? Roy, there may have been, but I 
am not aware of it. 



7111 

Mr, Sanders. Did you see Charles Ward while you were in Iowa in 
September ? 

Mr. TowNSEND. No. I don't think Charles Ward was in— I just 
feel real certain Charles Ward was not in Iowa when I was in Iowa. 
If he was, I didn't see him. Now, I'm not saying he wasn't in Iowa, but 
I sure don't recall seeing him. 

]Mr. Sanders. Have you ever been to the St. Paul or Waverly home 
of Senator Humphrey ? 

Mr. TowNSEND. No, I have not. 

Mr. Sanders. In 1970 or 1971 ? 

Mr. TowNSEND. I've never been to any of Mr. Humphrey's homes 
in Minnesota. 

Mr, Sanders. Do you have any knowledge that — first of all, let me 
ask you, do you know John Valentine? 

Mr. Townsend. No, I do not. 

Mr. Sanders. Do you know Norman Sherman ? 

Mr. Townsend. No, I do not. 

Mr. Sanders. While you were with AMPI, did you have any contact 
with the firm, Valentine, Sherman ? 

Mr. Townsend. None that I can recall. 

Mr. Sanders. TVliile you were with AMPI 

Mr. Townsend. It's possible that I may have called somebody at 
the Valentine, Sherman office, but I just don't recall it. 

Mr. Sanders. While you were with AMPI, were you aware that that 
firm existed? 

Mr. Townsend. Yes, sir. 

Mr. Sanders. And how did you know that, and in what connec- 
tion ? 

Mr. Townsend. I'm not sure when I first knew about it. The only 
direct knowledge that I had of Valentine, Sherman was with — in con- 
nection of an obligation with Governor Docking, of Kansas. 

Mr. Sanders. Would you explain, then, your previous testimony ? 

Mr. Townsend. I had forgotten it was there, and I think I relayed 
pretty much everything I know about Valentine, Sherman. If I men- 
tionecl that, did I also mention in there — the only time that it was 
brought up by AMPI people formally to me was at a restaurant some- 
place, and I don't know where it was, and Mr. Parr, Mr. Nelson, Mr. 
Lilly, and Mr. Isham were sitting at a table — the four. And there was 
a group of the rest of us sitting at another table, and they called me 
over, and they asked me if I knew anything about any commitments 
to Valentine, Sherman for anything other than Docking. And I said, 
"No, I do not," and they said, "OK," and I went back to the other 
table. 

]\Ir. Sanders. Did you ever have any convei^ation with Lilly con- 
cerning work done, or to be done, by Valentine, Sherman for AMPI? 

Mr. Townsend. For AMPI? 

Mr. Sanders. Yes. 

Mr. Townsend. No, I don't believe so. 

Mr. Sanders. While you were with AMPI, did you have any knowl- 
edge that Valentine, Sherman was doing work for AMPI? 

Mr. Townsend. I think that they did some surveys — ran some sur- 
veys for AMPI. 

Mr. Sanders. How did you learn that? 



7112 

Mr. TowNSEND. I think that I just overheard it. It possibly could 
have been in a board meeting. 

Mr. Sanders. Can you explain in any greater detail what survey 
work was done? 

Mr. TowNSEND. No, I really can't. 

Mr. Sanders. Or where ? 

Mr. TowNSEND. No, I do not know. 

Mr. Sanders. Do vou know wlio would have been handling it in 
AMPI? 

Mr. TowNSEND. Probably Mr. Nelson, but I'm not sure; I'm just not 
sure. I had one other conversation about Valentine. Sherman — relat- 
ing to Valentine, Sherman with Bob Lilly within the last 6 months, 
and that was when I called Bob Lilly and asked him if the obliga- 
tions to Governor Docking had been met and he said, as far as he 
knew, that they had. And I said, "OK ; I will be in a meeting where 
Governor Docking will be present, and I just want to know, because he 
may ask me something about it, and I just want to know." And he said, 
"As far as I know, they have," and that was the extent of it. 

Mr. Sanders. While you were with AMPI, did you learn that Valen- 
tine, Sherman was doing work for the Humphrey campaign? 

Mr. TowNSEND. I really don't think that I Imew that Valentine, 
Sherman was doing work for the Humphrey campaign. This is all 
just on. you know, maybe little things that I overheard. Somehow or 
other, I think it's possible that a fellow by the name of Jack Chestnut 
was — I have him associated with Valentine, Shennan some way. I'm 
not sure whether he worked for Valentine, Sherman or was an asso- 
ciate, or something, and I believe that Jack Chestnut at one time 
worked for Senator Humphrey, but don't hold me to that. I'm not 
positive of that. But I associate the name Jack Chestnut in some way 
with Hubert. Humphrey. 

Mr. Sanders. I still don't^ — from your answer, I'm not sure if I 
have an understanding of my question of whether, while you were 
with AlVIPI, you knew that Valentine, Sherman was doing work for 
the Humphrey campaign. 

Mr. Townsend. I guess I would just have to say that I honestly 
don't have any direct knowledge. I'm not sure whether I have any in- 
direct knowledge, vou see. I'm not sure of the time period we are talk- 
ing about, and I just — really, nothing to my knowledge that can tie 
Hubert Humphrey to Valentine, Sherman. There is nothing that I 
have ever heard other than just passing comments that would just^ — 
or it leads me to believe that there may have been something with 
Valentine, Sherman. Jack Chestnut, and Hubeit Humphrey. That's 
really the extent of my knowledge on the thing. 

Mr. Sandp:rs. Did you ever learn that Valentine, Sherman was doing 
anything — any work of benefit or value for the IMills campaign? 

Mr. Townsend. Not to my knowledge. 

Mr. Sanders. Do you recall ever remarking to Lilly that AIMPI had 
some commitment to Valentine, Sherman ? 

Mr. Townsend. Yes, sir; the one I just related to you, in terms of 
the Docking 

Mr. Sanders. Only the Docking? 

Mr. Townsend. Yes, sir. 

Mr. Sanders. No other ? 



7113 

INIr. TowNSEND. No otliers. 

Mr. Sanders. Do you over recall remarkiji":, or do you recall ever 
remarkino; to Lilly, that the value of the A^lPI commitment to Val- 
entine, Sherman would be for the benefit of Hubert Humphrey's 
campaip:n? 

INIr, TowxsEND. No, sir, I don't recall e^er having: made such a 
statement. 

Mr. Saxders. Or for the Wilbur Mills campaio^i? 

Mv. TowNSEXD. No, sir; I do not recall p\'pr makino- such a state- 
ment. 

Mr. Hamiltox. While you're looking;, can I ask a couple of ques- 
tions, Don ? 

Mr. Sanders. Sure. 

^Mr. Hamiltox. Do you know if AMPI had made— if A^MPI made, 
in the summer of 1971, any type of financial commitment to Hubert 
Humphrey to be elected President ? 

Mr. TowxsEXD. No, sir; I do not. 

^Nlr. HAMn.Tox". Do you recall tell in (j INlr. Lilly that there was a 
substantial connnitment to Humphrey by AINIPI ? 

Mr. Towx'SEXD. No, sir, T don't i(^call making' that statement. 

Mr. Hamietox'. If I mentioned a $140,000 commitment to Mr. 
Hum]:)hrey by AISIPI, would that make any sense to you? Would 
that ring: a bell ? 

Mr. TowxsEXD. It does not ring: a bell to me at all. 

Mr. Hamiltox. Have you ever lic^ard before this time that AMPI 
had a $140,000 commitmelit to Hubert Humphrey ? 

Mv. TowNSEXD. No, sir ; I have not. 

Mv. Hamiltox. You certainly would not have told Mr, Lilly at any 
time that AMPI had made a $140,000 commitment to Humphrey? 

Mr. Towx^sEXD. No, I don't see liow— no. l>ecause I'm not aware of 
any $140,000 commitment, and I couldn't have made such a statement 
to anybody. 

Mr. Hamilton. You are drawino- a blank ? 

Mr. TowNSEND. Yes, sir. 

Mr. Hamiltox. All rig:ht, Don. 

Mr. Saxders. Well, you may know this ah'eady, but to sharpen the 
question to you, I think I am oblig-ated to state to you, perhaps as a 
help in refreshing your recollection, exactly what was said to us by 
Lillv involving;, or relating; to you; and this is in the time frame of 
July 1971. 

He says that at about that time. Nelson, Parr, Chestnut, and pos- 
sibly Townsend met at the home of Humphrey in Waverly, Minn. 

Mr. Tow^xsEXD. I have never been at the home of Plubert. Humphrey 
in Waverly, Minn. 

Mr. Sanders. And then, he says : 

Shortly after this meeting. Nelson, Parr, and Townsend told me in San Antonio 
that we were committed to $140,000 to Humphrey and Mills through "Valentine 
and Associates. 

Mr. TowNSEXD. I am just flat not aware of that. 

Mr. Sanders. And you deny^— whether it is true or not, you deny 
ever saying that to Lilly ? 

Mv. TowxsEX^D. Yes, sir. You see, I'm not aware of any commitment 
for any amount of money to Hubert Humphrey for the 1972 cam- 



7114 

paign from anyone, and under tliose circumstances, it would have been 
just completely beyond my recollection of any possibility that I could 
have made such a stat-ement. 

]Mr. Sanders. If you liad said something like that to Lilly, you 
would probably be able to recall saying it? 

Mr. TowNSEXD. Boy, I sure think I would. 

Mr. Saxders. So your statement is not tliat vou don't recall sayino; it 
to Lilly, but that you did not say that to Lilly, or anything to that 
effect?* 

Mr. TowxsEXD. Well, gee, I mean, I just don't want to, I don't see 
any way that I could have. But maybe I was— I may have been visit- 
ing with Bob some time and he may have told me something about 
it, and asked if I knew about it or somethimr. and I may have nodded 
my head. But, boy, I just have no absolute knowledge of any commit- 
ment by AIMPI or anybody else to the campaign of Hubert Humphre3^ 
I just don't have any knowledge of it. 

Mv. Sanders. I hate to belabor the point, and T don't want to split 
hairs, but the way you are answering my question is by saying you 
have no knowledge of any such commitment. INIy question goes to the 
matter of whether you made any such statement to Lilly, without 
regard to — — 

Mr. TowxsEXD, To the best of my belief. I did not make any such 
statement to INIr. Lilly in that regard. 

Mr. Saxders. Do you have any knowledge of anv funds goinir to 
the 1971 and 1972 Presidential cami:)aign of Hubert H\unphrey which 
originated with corporate assets of AMPI ? 

Mr. TowxsEXD. No sir, I do not. 

Mr. Sax^ders. Or any such funds going to the Presidential campaign 
of Governor Wallace? 

INIr, TowxsEXD. No, sir, I do not. 

Mr. Saxders. Or to the Presidential campaign of Senator jNIuskie? 

INIr. TowxsEXD. No, sir, I do not. 

]Mr. Sanders. Are you acquainted with Bill Connell ? 

Mr. TowxsEXD. Yes. sir. 

Mr. Saxders. Could you just briefly desci'ibe the nature and extent 
of your relationship? 

Mr. TowxsEXD. ]\Iost of the relationship with Bill Connell has been 
in connection with Concept Films, Lie. There was a contract from 
AMPI to Concept Films to do two films, one related to the dairy 
farmer and his plight. I l)elieve it was called "]\Iailbox Money." 

ISIr. Saxders. You don't need to go into detail about that. 

Mr. TowxsEXD. OK. That is tlie main contact. To the best of my 
knowledge, I had met T)ill Comiell before that and know who he was. 
He was a former administi-ative assistant. T believe, to Senator Hum- 
phrey, and the main contact that I had with him was in coimection 
with these films. 

INIr. Sanders. And in any of your contacts with Connell, has there 
been any discussion concerning contributions to the Pi'esidential cam- 
paign of Senator Himiphrey ? 

Mr. Townsexd. Boy, there may have been. But I have no recollec- 
tion of any specific instance where there was. 

Mr. Saxders. Did he at any time solicit contributions from you ? 

Mr. Townsexd. From me? 



7115 

Mr. Sanders. From you as an individual or as an employee of 
AMPI? 

Mr. TowxsEXD. No, neither way. No. 

Mr. Sanders. Or make any solicit ation of A;MPI ? 

IVIr. Town SEND. Throneh me, no. 

Mr. Sanders. Or from TAPE? 

Mr. TowNSEND. No; not that I ran recall. You know, there were 
only tliree people that could malcc a TAPI'l commitment. That was 
Pai-r, Nelson, and Lilly. And I think that was fairly well known. 

Mr. Sanders. But I would assunie that other persons working for 
them could make suggestions or recommendations? 

Mr. Townsend. Oh, yes. And I'm sure, I fool confident that they did. 

Mr. Sanders. Did any of your contacts with Connell relate to Valen- 
tine, Sherman? 

Mr. TowNSEND. Yes; I was trying to think of whether it was more 
than one. I remember one, and that was about 4 weeks ago, and I was 
visiting Avith Bill Connell about a film project, another film project, 
and I said that I had been up before this committee and they had 
asked about Valentine, Sherman. And I didn't know a darned thing 
al)Out Valentine, Sherman. I didn't l)olieve T had ever met Jack Chest- 
nut or Valentine or Sherman. And I said that I had been inquiring, 
and that, I said that there was a 

Mr. Vanet. Excuse me, Tom. Tfe's not aslcing all the things that 
you said to him. He's asking you a simple (juostion, a question that I 
iiavo forgotten. 

Mr. Townsend. Do you want me to go ahead with my 

ISIr. Vanet. Just answer his question. 

Mr. Townsend. OK. 

Mr. Sanders. The question is : "Did you have any conversation with 
Connell relating to Valentine, Sherman." Ami your answer is, "Yes; 
about 4 weeks ago." 

In this conversation, did Connt^ll advise you of the nature and ex- 
tent of his relationship witli Valentine, Sherman ? 

Mv. Townsend. No; he said that he made a trip into Kansas. I 
told liim about the Docking thini;-, and he said that he made a trip 
down to Kansas to explain what tlio program was. And that was the 
extent of the convereation with him. 

Mv. Sanders. Did either of you in this conversation mention the 
matter of benefits for the campaign of Humphrey ? 

INlr. Townsend. No, sir. Not that I can recall. I don't recall any- 
thing being said about it. 

Mv. Sanders. Your calendar for January '20, 1971, has a notation 
"HHH, Parr, HSN to LouisAdlle." 

Mv. Townsend. Oh, yes. I believe 

IMi-. Vanet. Excuse me. There is no question, Tom. He hasn't asked 
you any question. Just try to listen to his questions, and we will move 
faster. 

Mr. Sanders. Did you travel to Ivouisville on that date ? 
Mv. Townsend. No ; I did not. 

ISIr. Sanders. And do you Imow the purpose of your, or the reason 
for your entry? 

INfr. Townsend. I think it was vei-y minor, that Hubert Humphrey 
was to speak to the board of directors of Dairymen, Inc. on that date. 



7116 

Mr, Sanders. At or about that time, did you learn that Parr had 
received a proposal from Valentine, Sherman for work which could 
be done for AMPI? 

Mr. TowxsEXD. No ; I am not aware of it. 

Mr. Sanders. On your calendar there are notations of "Connell" 
or "Bill Connell" in October on the 9th and 16th, and another one on 
January 17, 1972. Do von have a recollection for the reason of any 
of these entries? 

Mr. TowNSEND. Yes, sir. We were talking- about these films I was 
talking about. 

Mr. Sanders. "Was any aspect of your discussion with him on any of 
those days in relation to Valentino. Sherman ? 

Mr. TowNSEND. No, sir. Not that 1 can recall. 

INIr. Sandi]rs. All right. I Avaut to clarify a point with regard to 
all you have told us about a meeting in the Austin airport restaurant. 
In your first testimony before the committee you gave some indica- 
tion that this may have occurred at the time of a Mills speech to the 
Texas Legislature. 

Am I correct in assuming that you now completely disassociate 
those two events? 

]Mr. TowNSEND. Yes, I do. And I was going to tell you why, but 

Mr. Sanders. You are now certain that they occurred on two dif- 
ferent dates? 

Mr. Tow^xsEND. Yes, sir. 

INIr. Sanders. You lead me to ask the next question. "What is it that 
makes j^ou able to say so certainly that they were on two different 
dates ? 

Mr. Townsend. Because just this morning in trying to — I wracked 
my brain, since this was asked the first time, and just this morning I 
remembered the mode of transportation on both occasions, and they 
were different. So I feel certain that they were two different occasions. 

Mr. Sanders. One was the AMl'I jet? 

Mr. TowxsEXD. No, sir. One was a charter plane from Central Fly- 
ing Service in Little Eock. and the other one was a jet that we went to 
Austin with Chairman Mills. So T just feel confident that they Avere 
two different times. 

Mr. Saxders. What is the extent of any personal relationship you 
have with Congressman ]\Iills ? 

Have you had occasional personal couA'ersations Avith him? 

Mr. ToAvxsEND. Oh, sure. Yes, sir. 

Mr. Sanders. EA^er alone, or always with a group of others? 

Mr. ToAVNSEXD. No, I liave been with the chairman alone. 

Mr. Saxders. Were you acquainted with him before your employ- 
ment with AMPI ? 

Mr. ToAvxsEND. No, I was not. 

Mr. Sanders. HaA^e you ever talked with him about contributions 
from AMPI employees ? 

Mr. Toavnsend. Boy, not that I recall. Yes, I don't believe that I 
have. 

Mr. Sanders. Or have vou ever talked with him about funds from 
TAPE? 

Mr. Toavnsend. No, I don t believe that I ever have. 

Mr. Sanders. Has he ever asked vou for any contributions ? 



7117 

Mr. TowNSEXD. No, sir. 
Mr. Sanders. From TAPE or from AMPI ? 
Mr. TowNSEND. No, sir. 

ISIr. Sanders. Has Gene Goss e\ er asked \ ou for contributions for 
Congressman Mills' Presidential campaign? 
Mr. TowNSEND. No, sir. No, sir. 

Mr. Sanders. In your previous testimony, you remarked about an 
aborted checkoff system for Chairman Mills. Was this idea initiated 
by Parr? 

]\Ir. TowNSEND. I am not certain. T think tli;ii it was. 
IMr. Sanders. Was the checkoff to be made among AMPI employees 
or AiNIPI members ? 

:Mr. TowNSEND. AMPI employees is the only thing that I recall. 

Mr. Sanders. And was the idea that a certain amount of their pay- 
check be withheld and collected and delivered to the Mills campaign ? 

INIr. TowNSEND. I do not know that an amount was suggested. I know 
I signed an authorization to deduct— I don't recall the amount — from 
my check to be sent to the Elect Mills for President campaign. 

'Mr. Sanders. Well, what I'm trying to get an understanding of, is 
whether Parr's idea was that this was to be made known to all AMPI 
employees everywhere, and that it was to be, they were to be asked if 
tliey would authorize a checkoff to Mills, or whether this was just to 
be handled among a selected group of employees. 

Mr. TowNSEND. I really can't answer that. I know that it was 
brought up in a meeting in Mc Allen, Tex., that's where I signed an 
authorization form. And at that meeting tliere were — I don't know, 
maybe 100 employees of AMPI from the southern region of AMPI, As 
I recall, they were all from the southern region. And I don't recall any- 
thing in addition to that. 

Mr. Sanders. Did Parr make a presentation of this idea to that 
assembly ? 

jNIr. Townsend. I don't recall whether he did or not. 

Mr. Sanders. Do you know for what reason it was aborted? 

Mr. Townsend. No; I am not sure. I am not sure today. I got a 
letter back from Bob Isham saying this was against AMPI policy that 
had my authorization receipt enclosed. 

My understaiuling — I just don't know why it was, and I still don't. 

Mr. Sanders. Have you at any time learned that anyone working for 
Mills, either in his congressional office or in his campaign offices, 
were aware of that intended system ^ 

Mr. Townsend. No, I have no knowledge if they were aware of it 
or not. 

INIr. Sanders. Did you have any personal involvement in generating 
congressional support for the dairy cooperative effort to increase the 
milk support, level in INIarch of 1971 ? 

Mr. Townsend. Yes, sir. * 

Mr. Sanders. Did you personally contact any Congressmen? 

Mr. Townsend. Yes, sir. 

Mr. Sanders. Approximately how many? 

Mr. ToAVNSEND. I was probably in groups-^that maybe I contacted 
20. if I had to just guess, you know. 

Mr. Sanders. Did you talk with any Congressmen alone? 



7118 

Mr, TowNSEND. I clo]i"f believo that I ever did, I can't recall any 
instance where I did. 

INIr, Saxders, In your contacts with Congressmen in these groups, 
were you acting as the A]\IPI liaison ? 

Mr. TowNSEND, In some cases, jvs, I did. In some cases, I was there 
strictly as a resource i)erson. If tliey wanted factual information, I 
had it, 

Mr, Sanders, Were yon the only AMPI employee in those groups? 

Mr, TowNSEND, No; T would say I was not. There were probably 
some instances where I was, but some instances where I was not. 

Mr, Sanders. And we are speakijig of JNIarch 1971 ? 

Mr. Townsend, Yes, sir. 

Mr, Sanders, Was tliis before or after the ]\Iarch 12 decision? 

Mr, Townsend, I feel lelativel}- confident T had contact both before 
and after. The bulk of it was after the March 12 decision. 

Mr. Sanders, In February or ]\[arch 1971, did you have any con- 
versation with Chairman ]\Iills concerning the milk support level? 

Mr, Townsend, Yes, sir. None tliat I can recall where I was the only 
one there. 

Mr. Sanders. Did you liave any contact with him other than in the 
presence of a number of dairymen ? And by dairymen I mean coopera- 
tive members, as opposed to employees. 

Mr, Townsend. Oh, yes, I think tliat I probably did, 

Mr, Sanders. Perhaps in the presence of Parr or Nelson ? 

Mr. Townsend. Yes ; I tliink that I probably did. 

Mr. Sanders. Are you aware that Chairman ]Mills met with Speaker 
Albert, early in February concerning the milk support level ? 

Mr, Townsend, Yes, sii\ 

INIr. Sanders. Were you present ? 

Mr. Townsend. Yes, sir. 

Mr. Sanders. ^V]\o initiated that meeting? 

Mr. Townsend. I think Speaker Albert called Chairman Mills, and 
I am not sure, you know, what the conversation was between those two. 

Mr, Sanders. Well, did AMPI. anyone in AMPI, ask that this meet- 
ing take place, to your knowledge ? How did it begin ? 

INIr, Townsend, Well, you know, we were working on price support 
clear back in January — you know, developing resource papei-s and that 
kind of thino;. We finally finished one up the 24th of February, And 
we were calling on various Conirressmen, as I recall, probably in Feb- 
ruary and early March, before the ]\rarch 12 decision, in terms of trying 
to get support for price support. And I think that — I am kind of con- 
fused in terms of my dates. There Avas a time — or even the subject mat- 
ter — there was a time when Chairman Mills and the Speaker got 
together and asked somebody from the White House, a liaison man. to 
come up at a meeting in Speaker Albert's office right off the floor of the 
House. There was somebody there from the '\^niite House, I believe 
Bill Galbraith. I am not positive. 

Mr. Sanders. One would tend to think that that tvjie of a meeting 
occurred because a dairy cooperative, pei'haps AISTPI. asked that it 
take place, perhaps asked Congressman IVIills to set it uf). Ho you know 
of any facts to support this ? 

Mr. Townsend. I think, in terms of generating, you know, ways to 
get support for an increase in milk price support, which was badly 



7119 

needed, I think this would have been very logical. I suspect that this 
would have been one avenue, in terms of various alternative methods, 
of generating support that would have come from. AMPI, yes, sir. 

Mr. Sanders. Did Dave Parr ask Chairman JNIills to schedule this 
meeting? 

Mr. TowNSEND. I just really don't know. I think it would be reason- 
able to assume that he would, yes. 

INIr. Sanders. Were you present at any conferences with Chairman 
IVIills before the meeting with Albert when a discussion occurred con- 
cerning meeting with Albert? 

Mr. TowNSEND. I could have been. I just don't have any recollection 
of it, but I sure could have been. If there M-as one there, and they 
wanted to have somebody that had, you knoAv, that knew the numbers 
thing in terms of the economics of it, I think that I would have been 
there. 

]Mr. Sanders. And you said that vou were present when Albert and 
Mills met? 

Mr. TowNSEND. I recall two meetings of Albert and Mills. 

INIr. Sanders. Were you present at both ? 

Mr. TowNSEND. I think there were two meetings. Now, I may be con- 
fused, but I think there were two meetings in Speaker Albert's office. 
But I don't think that they related, at least one of them I don't think 
related entirely to price supports, and I'm not so sure it did at all. I 
know it related to a — oh, three- or four-point program of the dairy 
industry, and things that were needed including, I think, price 
supports. 

ISIr. Sanders. Was the White House liaison present at but one ? 

Mr. Townsend. I am not sure. I know that he was at one of them, 
and I'm not sure about the other one. The person that did most of the 
talking at the one was the "Wliite House — I'm sure that the White 
House representative who was there was — I am embarrassed — the 
name of the ranking Republican on Ways and Means in 1971. Oh, John 
Byrnes from Wisconsin was there and did most of the talking. 

Mr. Sanders. "WHiat was tlie overall purpose of the meeting? How did 
it appear to you? 

]\Ir. Townsend. Well, the farmers were in relatively bad — the dairy 
farmei-s were in a relatively bad position. 

INIr. Sanders. No, that would Ix' a reason — I mean, what was the 
objective of the meeting? 

!Mr. Townsend. Oh. the objective would hare been to get the support 
of the White House liaison man to the program that we wanted. 

Mr. Sanders. Which was statutory increase in the support? 

Mr. Townsend. I think that was part of it. There was about three 
parts to the program. Dr. ]Mehren was also there. I think imports was 
a part of it. I think some additional statutory authorty in tenns of 
cooperatives and doing business was a part of it. And I tliink the price 
support was part of it. To the best I can recall, there was about three 
or four points. 

Mr. Vanet. Tom, I should have told you a long time ago, just be- 
cause there is a pause in the questioning, you don't have to fill up that 
pause with something if you have already losponded to the question. 

Mr. Townsend. OK. 



7120 

Mr. Sanders. So your main interest in February, March 1971 was 
the impending decision on the milk support level, I assume? 

Mr. TowNSEND. Yes, sir. 

Mr. Sanders. What, if anythintr. did Chairman INIills and Speaker 
Albert represent to AINIPI that tliey were personally willing to do for 
the dairymen ? 

Mr. TowNSEND. Well. I think, lend support to the bills that were 
being introduced. 

Mr. Sanders. Chairman Mills, of course, never introduced or spon- 
sored any such legislation. 

Mr. TowNSEND. I thought that he did. 

Mr. Sanders. He may have been vocal in expressing support for it. 
But I don't believe he sponsored a bill. 

Mr. Townsend. OK. 

Mr. Sanders. I may be wrong on that. 

Mr. Townsend. I was under tlie impression that he had, and that 
this was a^ — ^whoops — Poage did, and it was unusual for the chairman 
of the committee to do so. and we thought that was significant. And I 
thought the same was true of Mills, l)ut maybe he did not. 

Mr. Sanders. All right. If he did sponsor any legislation, did he 
represent that he w^ould do anything further to enhance the likelihood 
of passage ? 

Mr. Townsend I don't recall anything specifically that he said, but 
I sure had the distinct impression that he would try to be helpful in 
terms of advising the administration and other Members of Congress 
to generate support. 

Mr. Sanders. Did he represent that he woidd call influential pereons 
in the administration ? 

Mr. Townsend. I'm having some difficulty in terms of the white 
paper that the administration put out 2 weeks ago. Reading that and 
newspaper accounts and remembering back there, I am not sure that 
I know that he said that he would call any member of the White House 
staff. 

Mr. Sanders. What if anvthing did Speaker Albert represent that 
he would do to enhance the likelihood of legislation ? 

Mr. Townsend. I don't recall anything specifically that the Speaker 
said that he would do. 

Mr. Sanders. Did he express a viewpoint? 

Mr. Townsend. He said that he lielieved that we had a problem, and 
that dairy farmers were on the short end, and that our facts, he 
thought, justified a price increase. 

Mr. Sanders. Were you a party to any conversations among officials 
or employees of AMPI wherein it was said that anv contributions 
made or to be made by TAPE were in consideration of — and hei'e I'm 
talking contributions to Congressmen and Senators — were in considera- 
tion of their support of tlie milk snj^port bills ? 

Mr. Townsend. No, sir. 

Mr. Hamilton. Wiy don't you ask the same question regarding 
administration support while you'i-e there? 

Mr. Sanders. The same question applies to whether you were a party 
to any conversations between officials or employees of A]MPI wherein 
it was stated that any contributions to the reelection campaign of 



7121 

President Nixon were in consideration of the administration's reversal 
of the March 12 decision ? 

Mr. TowNSEND. No, sir. 

Mr. Sanders. Ben, do you have some questions ? I might iiave a few 
more. 

Mr. Hamilton. I have one more. Were you informed in the fall or 
winter of 1971, that Mr. Nelson and Mr. Parr had made a $50,000 
pledge to Hubert Humphrey's campaign ? 

Mr. TowNSEND. No, sir. I'm not aware of that. 

Mr. Hamilton. OK, then I am through. 

Mr. Plotkin. Mr. Townsend, you stated before that you were at 
President Johnson's home following the trip to Austin by Representa- 
tive Mills for a speech to the joint session? 

Mr. Townsend. Yes. 

Mr. Plotkin. OK. "Wlio went to LBJ's ranch besides yourself? 

Mr. Townsend. Dave Parr and Oarl Arnold. 

Mr. Plotkin. Did Chairman Mills go ? 

Mr. Townsend. Yes. Excuse me, and Chairman Mills. 

Mr. Plotkin. All right. Now, do you recollect any conversation at 
the President's home with regard to campaign contributions ? 

Mr. Townsend. No, sir. I do not. 

Mr. Plotkin. You have no recollection about the President being 
asked how a commitment by AMPI to President Nixon's campaign 
should be handled ? 

Mr. Townsend. No, sir. I have no recollection of anything on that. 

Mr. Plotkin. Was there any time, while you wei-e there, that any 
of you left the President's company and he was alone Avith one of you ? 
Was he alone, for example, with Mr. Parr or Mr. Lilly, and you and 
Chairman Mills and Mr. Arnold might have been someplace else? 

Mr. Townsend. Mr. Lilly was not there. 

Mr. Plotkin. Oh, excuse me. I apologize. Was there any time that 
you were split up ? 

Mr. Townsend. There was a lot of time that I was split up from the 
others, because I had a camera and I was taking pictures. So my role 
was a little bit different from the others in the group. And I did take 
pictures, and there was quite a little time, you know, that I was not 
physically in the immediate proximity. 

Mr. Plotkin. So while you were taking your pictures the President 
might have been engaged in conversations with Mr. Parr or Arnold 
and Chairman Mills? 

Mr. Townsend. Oh, yes. 

Mr. Plotkin, Did any of them discuss with you or mention to you 
the gists of any of the conversations they might have had with the 
President while you were out of the room ? 

Mr. Townsend. Not that I recall. No, we weren't inside a house. This 
was all outside, from the time we got there. 

Mr. Plotkin. All right. What, to the best of your- recollection, was 
tlio purpose of the visit ? 

Mr. Townsend. Gosh, the main thing that was talked about, that 
I overheai'd, was a lot of recollections between Chairman Mills and 
the President in terms of situations where they Avere both involved 
when he was President, and the Chairman was Chairman of the Ways 
and Means. And most of the time was taken up — I was in the back 



30-337 O - 74 - Bk. 16 



\ 



7122 

seat of the ear and was driving around the ranch looking at the ani- 
mals, and we stopped and judged the weight of the new bull that the 
President had bought. 

Mr. Plotkin. Then what you are saying — this was primarily a 
social call ? 

Mr. TowNSEND. Oh, to my knowledge I heard nothing other than 
social. 

Mr. Plotkin. There was no effort on Chairman Mills' part to solicit 
advice from the President with regard to how the dairy producers' 
problems should be handled before Congress or before the adminis- 
tration ? 

JNIr, TowNSEND. No, sir. Not in my presence, there Avas not, not that 
I overheard, and I would seriously doubt if there was. 

Mr. Plotkin. But you really have no recollection of any significant 
conversation having taken place ? 

Mr. TowNSEND. No, sir, other than I was closest to judging the 
weight of the bull. 

Mr. Sanders. What is your present position with Mid-Am ? 

Mr. Tow^xsend. Director of special projects. 

Mr. Sanders. And your office is in Springfield, Mo. ? 

Mr. Townsend. Yes, sir. 

Mr. Sanders. You have been with them since April 197'2 ? 

Mr. Tow^NSEND. Yes, sir. 

Mr. Sanders. Same position? 

Mr. Townsend. Yes, sir. 

Mr. Sanders. To whom do you report ? 

Mr. Townsend. Gary Hanman, H-a-n-m-a-n. 

Mr. Sanders. Do your duties entail legislative liaison ? 

Mr. Townsend. Part of it, yes. 

Mr. Sanders. Do you have any responsibilities with regard to the 
allocation of funds from ADEPT ? 

Mr. Townsend. No, I really don't. I make some recommendations 
from time to time. 

Mr. Sanders. An entr^^ on your calendar for December 4, 1971, says 
"airport: Mills." I wonder if you might recall the purpose of that? 
I will show it to you. 

Mr. Townsend. Yes, I remember that. There was the dedication of 
the Little Rock airport scheduled for that date. I don't believe that 
it ever took place. I don't believe the airport was ready to be dedi- 
cated at that time. I'm not sure when the airpoit was dedicated, or if 
Mills was there, or spoke or anything. 

Mr. Sanders. There is an entry on December 6, 1971, which is 
stricken. Do you know what was blocked out ? 

Mr. Townsend. It looks like up at the top, U-D-I-A, and it looks 
like.in some Quality Motel. I'm going to say it's Atlanta, and I believe 
the meeting was called off. 

Mr. Sanders. Did you have any responsibility with respect to the 
October 1071 Iowa rally for the authorization of funds to be paid by 
AMPI for expenses of the rally ? 

Mr. Townsend. No, I don't i3elieve that I did. 

Mr. Sanders. Were you involved in any conferences or meetings 
with representatives of other cooperatives where the allocation of 
expenses was discussed ? 



7123 

Mr. TowNSEND. I believe that I was. 

Mr. Sanders. Could you give me some understanding of what 
AMPI undertook to underwrite for the event? 

Mr. TowNSEND. I don't recall that there was anything that was 
underwritten by AMPI. 

INIr. Sanders. What sort of division of expenses was made ? 

Mr. TowNSEND. I think in terms of the — I believe that in terms of 
the total Iowa cooperative month expenses, that there were, I think 
there were expenses that — boy, you're getting on the real fringes of me, 
of my memory. 

In terms of, I think, expenses or some of the costs that were, in 
terms of that Iowa cooperative month through the Iowa Institute of 
Cooperation, I believe there was a special account. When I think 
back, I think there was a special account set up, and I think some of the 
money that was used in that special account came from AMPI, and 
some came from Mid- America Dairymen. And I think I had a conver- 
sation with Gary Hanman one time in terms of those expenses, and 
trying to get JNIid-Am to pay to the Iowa Institute of Cooperation to 
cover some of those expenses. And I'm not sure, but what I didn't 
ask Farmland Industries also if they could make some contributions 
in terms of the Iowa cooperative month campaign. And I may have 
made them also to Land-0-Lakes, or the Philco Division of Land-0- 
Lakes. 

Mr. Sanders. Well, would you not have been the one, on behalf of 
AMPI, to agree to accept any, or a certain proportion of expenses? 

Mr. TowNSEND. I could have been. Yes, sir. 

Mr. Sanders. Who else could have been besides you ? 

Mr. TowNSENT^ Joe Johnson, I would think. I would think Dave 
Parr, Harold Nelson, Bob Isham, 

Mr. Sanders. But I mean, in terms of the reality of who was on the 
scene and having meetings with other cooperative people. 

Mr. TowNSEND. Oh, I think either Joe Johnson or I could have. 

Mr. Sanders. Do you have some concept of the overall cost of it? 

Mr. TowNSEND. I have no idea of the overall concept. 

Mr. Sanders. Does $50,000 or $60,000 sound reasonable ? 

Mr. TowNSEND. No, sounds way, way high. 

Mr. Sanders. Do you have some concept of what was ultimately 
paid by AMPI? 

Mr. TowNSEND. No, sir. I do not. 

Mr. Sanders. Does about $6,000 sound reasonable ? 

Mr. Townsend. I just really don't have any concept. 

Mr. Sanders. I have no further questions. 

I thank you for your patience. 

[Whereupon, at 1 :35 p.m., the hearing in the above-entitled matter 
adjourned.] 



MONDAY, JANUARY 28, 1074 

U.S. Senate, 
Select Committee on 
Presidential Campaign Activities, 

Washington, D.C 

The Select Committee met, pursuant to notice, at 2 :30 p.m., in room 
342, Eussell Senate Office Building. 

Present : Senators Weicker and Talmadge. 

Also present: James Hamilton, assistant chief counsel; Donald 
Sanders, deputy minority counsel; Benjamin Plotkin, minority in- 
vestigator. 

Senator Weicker. Do you swear that the evidence you are about 
to give the committee is the truth, the whole truth, and nothing but 
the truth, so help you God ? 

Mr. Arnold. Yes, I do. 

Senator Weicker. All set ? 

Mr. Hamilton. Yes. 

[A brief recess was taken.] 

Mr, Plotkin. For the record, I am personally serving Mr. Carl 
Arnold a subpena issued by the Senate Select Committee on Presi- 
dential Campaign Activities, returnable today, January 28, at 2 p.m. 

I should further like to point out that Mr. Arnold is appearing 
here voluntarily, notwithstanding the subpena. 

Mr. Sanders Would you state your name, please ? 

TESTIMONY OP CARL P. ARNOLD, ACCOMPANIED BY J. D. 
WILLIAMS, COUNSEL 

Mr. Arnold, Carl F. Arnold. 

Mr. Sanders. Would you state your residence and office addresses ? 

Mr. Arnold. My legal residence is 867 Canal Drive, McLean, Va, 
T have got a couple of offices. The one here in Washington is 1100 Con- 
necticut Avenue. 

Mr. Sanders. How many other offices do you have ? 

Mr. Arnold. One other. 

Mr. Sanders. And what is that address ? 

Mr. Arnold. That's in the Murphy and Arnold Building in Bates- 
ville, Ark. 

Mr. Sanders. And what is your principal business activity or pro- 
fessional activity ? 

Mr. Arnold. It is hard to define principal. Can I just sketch the 
major ones? 

In Arkansas I am in the farming and real estate business. At various 
places in this country and in Canada I am in the business of trying 
to find new supplies of oil and gas — exploring for oil and gas. In 
Washington, two things : looking after investments, and as a business 
consultant. 

(7125) 



7126 

Mr. Sanders. Do you have a firm name ? 

Mr. Arnold. No, sir, just my name; no associates or anything else. 

Mr. Sanders. Unincorporated ? 

Mr. Arnold. Just Carl F. Arnold. 

Mr. Sanders. Are you in business with any other persons? 

Mr. Arnold. I am in a lot of partnerships, and I own stock in a 
lot of corporations. 

Mr. Williams. May I inquire ? We would like to request a transcript 
of this session. I could not tell from the rules. It states even 

Mr. Sanders. Why don't we go off the record ? 

[Discussion off the record.] 

Mr. Sanders. Mr. Arnold, did you serve in any official capacity 
with any adjunct of the Mills for President effort in 1971 and 1972^? 

Mr. Arnold. No, sir. 

Mr. Sanders. Did you serve in any unofficial capacity, assisting the 
Mills Presidential effort? 

Mr. Arnold. Well, I served in the same capacity I would serve with 
any friend, where I could be of some help. 

Mr. Sanders. It is my understanding that the draft Mills effort 
began in mid- 1971, principally at the initiation of Mr. Charles Ward. 
Are you acquainted with him ? 

Mr. Arnold. Yes, sir. 

Mr. Sanders. Or did you serve in the draft effort in conjunction with 
Mr. Ward? 

Mr. Arnold. Well, I have to explain that. I never did work for 
him or with him but we had frequent conversations. You know, I would 
say, "How are things going?" and he'd tell me, but he had a head- 
quarters set up. I had no connection whatever with the headquarters. 

Mr. Sanders. Do you have a home in Arkansas also, or is your pres- 
ent place of residence here ? 

Mr. Arnold. Well, I have three of them part time. It depends on 
whether they are occupied. I have got three houses down there, but I 
am down there an awfully lot. 

Mr. Sanders. In what manner did you assist the Mills Presidential 
effort? 

Mr. Arnold. Well, the only real manner would be asking friends to 
help the campaign. Here again, let me emphasize it was no different 
than if any member of this committee who was a friend of mine 

Mr. Sanders. I am not imputine: anything wrong with your ac- 
tivity. I just wanted to get an understanding of what your involve- 
ment was, 

Mr. Williams. I had understood there were four areas we were going 
to go into. Was I cori-ect ? 

Mr. Sanders. Yes: but I am trvino; to find out what the nature and 
character of his involvement was in the Mills campaign. 

I don't think I can intelligently go into the others until I explore the 
relationship he had with the campaiirn. Did the support that you 
have mentioned that you tried to develop among friends of yours — did 
that extend to financial support? 

Mr. Arnold. Yes, sir. 

Mr. Sanders. Did you seek — did you solicit financial contributions 
for the Mills campaign ? 



7127 

Mr. Arnold. Yes ; in the sense that anybody I knew — if they in- 
quired about it, I would tell them that I understood the campaign 
needed some financial assistance, and if they could be of any help 

Mr. Sanders. Was this all by personal contact, or did you do any 
by mail ? 
* Mr. Arnold. I don't recall doing any by mail. 

Mr. Sanders. Did your fundraising activities extend up to the time 
of the Democratic Convention ? 

Mr. Arnold. Prior to April 7, I was more active than after April 
7. After April 7, if somebody asked me, then, yes; I would say I under- 
stand they have got a deficit and any help would be appreciated. 

[Discussion off the record.] 
******* 

Mr. Sanders. Well, you did make a trip to New Hampshire dur- 
ing the preprimary period ? 

Mr. Arnold. Yes, sir. 

Mr. Sanders. Did you make two trips to New Hampshire ? 

Mr. Arnold. To my recollection, I made two. 

Mr. Sanders. One of them with Chairman Mills? 

Mr. Arnold. Yes, sir. 

Mr. Sanders. Was he on a speaking trip ? 

Mr. Arnold. He had a speech scheduled that day. I think I made 
a trip with Mr. Mills. 

Mr. Sanders. Was that to the New Hampshire Legislature? 

Mr. Arnold. I don't recall exactly wlio he spoke to. 

Mr. Sanders. Well, on the occasion of either of your trips to New 
Hampshire, did you deliver any cash to some persons in New 
Hampshire working with Mr. Mills ? 

Mr. Arnold. I don't recall doing that ever, no, sir. 

Mr. Sanders. Did you take any cash with you of $1,000 or more 
for the purpose of making it available for the Mills Presidential 
effort in New Hampshire ? 

Mr. Arnold. I don't recall doing that, no, sir. 

Mr. Sanders. Or did you deposit to any New Hampshire banking 
institutions any funds for the Mills campaign ? 

Mr. Arnold. No, sir. 

Mr. Sanders. Did you at any time send any funds to New Hampshire 
for the preprimary effort ? 

Mr. Arnold. Not to my knowledge ; no. Maybe this money of Mr. 
Wild's ended up there, but 

Mr. Sanders. I wanted to know if you did. 

Mr. Arnold. No, sir. 

Mr. Sanders. We have information, Mr. Arnold, that in about 
August of 1971, a sum of cash was delivered to persons in Washing- 
ton on behalf of Chairman Mills, money originating from AMPI, the 
Associated Milk Producers, Inc. This sum of money was $5,000. Were 
you contemporaneously aware of the delivery of that money? 

Mr. Arnold. No, sir. * 

Mr. Sanders. Have you at any time up to the present talked with 
anyone in the Mills congressional or campaign offices concerning the 
delivery of that money ? 

Mr. Williams. Your question is limited to the Mills campaign 
office? 

Note : Stars indicate portions of testimony on anotiier subject which was omitted, but 
will be printed in a later volume. 



7128 

Mr. Sanders. I said congressional or campaign offices. 

Mr. Arnold. At some point recently, I have heard about inquiries 
being made into that subject. When I say recently, I mean within 
the last week or two, and that is the first, to my knowledge, that I have 
ever heard of it anywhere. 

Mr. Sanders. At any time in 1971 or in 1972, did you have any con- 
tact with any officers or personnel of AMPI to solicit from them money 
for the Mills campaign ? 

Mr. Arnold. I don't recall soliciting ever from any AMPI officials. 

Mr. Sanders. Are you acquainted with Dave Parr ? 

Mr. Arnold. Yes. 

Mr. Sanders. With Harold Nelson ? 

Mr. Arnold. Yes, sir. 

Mr. Sanders. At any time in 1971 or 1972, did you learn that AMPI, 
as opposed to their political action arm, TAPE, had contributed any 
funds to Chairman Mills ? 

Mr. Arnold. No, sir, I don't recall hearing anything like that, but 
that is a typical subject that I wouldn't get into anyway, not being my 
business. 

Mr. Sanders. Are you acquainted with Tom Townsend ? 

Mr. Arnold. I believe I have met Mr. Townsend, but I can't put the 
face in front of the name right now. But I believe I have met him. 

Mr. Sanders. Did you meet him in connection with your work in the 
Mills campaign in 1971 ? 

Mr. Arnold. Well, I don't recall that exactly. Since I can't put the 
face with the name, it could have been there or I could have just seen 
him at Mr. Mills' office, if he ever went to see Mr. Mills, or I could have 
met him in Little Kock, Ark., if he is stationed in Arkansas. 

Mr. Sanders. Are you acquainted with Jake Jacobsen ? 

Mr. Arnold. I have met Jake Jacobsen I believe one time. 

Mr. Sanders. Do you know of any contributions that he made avail- 
able for Chairman Mills ? 

Mr. Arnold. No, sir. 

******* 

Mr. Sanders. You understand, I am sure, what TAPE is. 

Mr. Arnold. I've heard of TAPE and I know it is the political arm 
for some dairy association. I don't know which one. 

Mr. Sanders. It is the political arm for AMPI and the successor to 
TAPE called CTAPE contributed $25,000 to the Mills for President 
campaign on June 13, 1972. Did you have any involvement in the 
arrangements for the delivery of those funds? 

Mr. Arnold. No, sir. 

Mr. Sanders. Did you have any participation in the solicitation 
of it? 

Mr. Arnold. No, sir. 

Mr. Sanders. Were you contemporaneously aware that it was sent 
to tlie Mills campaign ?'^ 

Mr. Arnold. No, sir. 

Mr. Sanders. Have you at any time learned why that particular 
sum was contributed ? 

Mr. Arnold. No. sir. 

Mr. Sanders. That's all. 

[Whereupon, at 4:10 p.m., the hearing in the above-entitled matter 
adjourned.] 



THURSDAY, JANUARY 31, 1974 

U.S. Senate, 
Select Committee on 
Presidential Campaign Activities, 

Washington, B.C. 
The Select Committee met, pursuant to notice, at 10 :15 a.m., in room 
G-3, Russell Senate Office Building. 
Present : Senator Baker. 

Also present: David Dorsen, assistant chief counsel; Barry Scho- 
chet, assistant majority counsel; Benjamin Plotkin, minority investi- 
gator. 

Senator Baker. Would you hold up your right hand. 
Do you solemnly swear that the testimony you are about to give will 
be the truth, the whole truth, and nothing but the truth, so help 
you God ? 
Mr. Palmby. I do. 
[A brief recess was taken.] 

TESTIMONY OF CLARENCE D. PALMBY, ACCOMPANIED BY 
ARTHUR L. LYMAN 

Mr. Dorsen. Could you give your present position and address for 
the record ? 

Mr. Palmby. My present position ? 

Mr. Dorsen. Yes. 

Mr. Palmby. I am vice president of Continental Grain, New York. 

Do you want my home address ? 

Mr. Dorsen. Yes, please. 

Mr. Palmby. 45 Sutton Place South, New York. 

Mr. Dorsen. Mr. Lyman, could you identify yourself for the record ? 

Mr. Lyman. I am appearing as counsel for Mr. Palmby. My name 
is Arthur L. Lyman, and I am a member of the firm of Paul, Weiss, 
Rif kind. Wharton & Garrison of New York. 

Mr. Dorsen. IMr. Palmby, what Avas your position immediately prior 
t/O your present position ? 

Mr. Palmby. I was an Assistant Secretary of Agriculture. 

Mr. Dorsen. How long did you hold that position ? 

INIr. Palmby. From January 22, I believe it was, 1969, to June 7, 
1972. 

Mr, Dorsen. What did you do immediately prior to that? 

Mr. Palmby. I was executive vice president of the U.S. Feed Grain 
Council. 

Mr. Dorsen. How long did you do that? 

Mr. Palmby. Nearly 8 years. 

Mr. Dorsen. What is, briefly, your expertise in terms of education 
and training in the agriculture area ? 

( 7129 ) 



7130 

Mr. Palmby. My training is in animal science. 

Mr. DoRSEN. In the period 1970 and 1971, what were your duties 
as an Assistant Secretary of the Department of Agriculture ? 

Mr. Palmby. In the period when ? 

Mr. DoRSEN. 1970 and 1971. 

Mr. Palmby. For the full period of time that I was in the Depart- 
ment of Agriculture, the first 31/2 years or thereabouts of the Nixon 
administration, I was Assistant Secretary for International Affairs 
and Commodity Programs. 

Mr. DoRSEN. What did that involve ? 

Mr. Palmby. It can best be explained by the agencies that reported 
through me to the Secretary. There were four such agencies. One, the 
Foreign Agriculture Service; tAvo, the Agriculture Stabilization and 
Conservation Service; three, the Export. Marketing Service; four, 
the Federal Crop Insurance Corporation. Plus I had a very small inter- 
national organization staff. And, in addition, of course, to those 
agencies reporting to me, I was a member of the Board of Directors 
of the Commodity Credit Corporation and the last few months of my 
tour of duty on the board of the rural telephone— I am not quite sure — 
I believe it is the Rural Telephone Bank or some such that was just 
organized shortly before I left. 

Mr. DoRSEN. What other positions have you held with the Federal 
Government ? 

Mr. Palmby. I served the Government from 1953 to January 20, 
1961. Also, you will note I just had an 8-year interim. 

And during that earlier tour of duty. I was State chairman of the 
agriculture stabilization conservation committee in the State of Min- 
nesota for about 3 years, from about March, March of 1953, until 
March of 1956, at which time I came to Wasliington as Associate Direc- 
tor of the Grain Division, later Director of the Grain Division, and 
Deputy Administrator of the Commodity Stabilization Service, later 
as Associate Administrator of Commodity Stabilization Service, a 
position which I occupied when I resigned shortly after the election of 
November of 1960, effective January 20, 1961. 

Mr. DoRSEN. Over the course of the last few years, 1969, 1970, 1971, 
and 1972, were you involved at all in the price support, decisions with 
respect to dairy products? 

Mr. Palmby. Yes. As a member of the Board of Directors of the 
Commodity Credit Corporation. 

Mr. DoRSEN. Was that your only involvement ? 

Mr. Palmby. You have to understand that the Agency — may I 
now call it the ASCS to save work ? 

Mr. DoRSEX. Yes. 

Mr. Palmby [continuing]. Is really the work arm of tlie Commodity 
Credit Corporation. Consequently, the Administrator of that Agency 
reported to the Secretary through me, as was the custom in the De- 
partment at that time, run strictly as a straight-line type of depart- 
ment, so that the Agency reported through me to the Secretan', and in 
turn the policy went down from the Secretary to tliat agency. So to the 
extent that there was action in any of these programs, the price sup- 
port programs, including this one on manufactured dairy products, 
which was administered by that Agency, sought policy guidance from 
me in the straight-line type of operation. 



7131 

Mr. DoRSEN. According to the USDA records on March 12, 1971, 
the price support level for manufactured milk products was announced 
at $4.66 per hundredweight. 

Could you please describe your knowledge of the events leading up 
to that announcement ? 

Mr. Palmby, Yes, I will do the best I can. Remember it has been 
3 years ago. The records I have are on the table. 

Mr. DoRSEN. It should be clear that Mr. Palmby is indicating that he 
did not bring any records with him and, apparently, he has no records. 

Mr. Palmby. The date at which the decision on the level of price 
supports for manufactured dairy products, as I recall, must be an- 
nounced by April 1 of each year. So, historically, during the tim.s 
that I was there, and, of course, in the earlier tour of duty, in the 
years between, as I recall it, there has always been a good big deal of 
publicity given as to what the level of price support might be, con- 
sistent with the terms of the statute with which I believe, at that time, 
made it mandatory that manufactured dairy products be supported 
at a level somewhere l>etween 75 and 90 percent. I believe that was the 
statute at that time, that the language in the act which, really, in my 
opinion, was most meaningful, was that the level should be established 
at a level — ^that price supports should be esta;blished at a level that 
would assure an adequate supply of dairy products. 

So, finally, in answer to your question, we had a considerable amount 
of what I would call infonnal discussion, both in Secretary Hardin's 
immediate family staff sessions in the morning, and I believe we did at 
an established meeting of the Commodity Credit Board, even though 
the item was not in the agenda, we discussed the dairy situation, and 
there were a couple of unusual factors. 

Counsel, am I taking too long? 

Mr. Lyman. Answer it as fully as you can. 

Mr. Palmby. There were several unusual type of situations that 
existed at that time, and I am going into detail. 

Mr. DoRSEX. I want you to, please. 

Mr. Palmby. No. 1 — not necessarily in order of importance — ^the 
year 1970 we had a southern corn leaf blight problem which did rather 
drastically affect the volume of corn that was produced and in turn 
was reflected in higher prices for corn which, to a degree, had what 
I choose to call a rub-off effect on the price of all feed ingredients, 
which of course is the raw material for dairy production. 

Mr. Plotkix. AA^iat do you mean, a "rub-off effect" ? 

Mr. Palmby. On other feed ingredient prices that responded to a 
degree to the higher corn prices. I am speaking of protein supplements, 
to the extent of roughage, so there was an increase in the cost of feed 
ingredients utilized for dairy herds. That is really No. 1. 

No. 2, the Commodity Credit Corporation had acquired what I would 
choose to call somewhat of a troublesome surplus supply. That is al- 
ways a cost item and traditionally butter, the surplus butter, that must 
go through the disposal route, has been a rather costly thing for the 
Commodity Credit Corporation. 

No, 3, tliere was rather a peculiar situation happening in the world 
daily markets at that time. New Zealand, which is the largest single 
dairy exporting country, had suffered a drought. The country also 
had had continuing contracts for export of butter to the United King- 



7132 

dom, so the United Kingdom, whether this came through a formal 
route, I cannot be sure of this, but I know our agriculture attache at 
that time fed the information that the British would be receptive to 
buying surplus butter at some price from the Commodity Credit 
Corporation. 

It also later developed that the Canadians had a shortage of butter, 
and there were some other countries, too, to a limited amount, one being 
Algeria. 

Whether it was at that particular time or before March 12, or some- 
where after, I do not know, but a decision was made by the Commodity 
Credit Corporation — it was a joint decision with the Office of Manage- 
ment and Budget — we discussed it thoroughly with the State Depart- 
ment — that Commodity Credit should, in the best interests of the 
Nation and the best interest of the Commodity Credit Corporation, 
offer that butter for export. 

A price was arrived at using the best judgment that we could con- 
sistent with what other butter was selling for on the world market. As 
I recall, the butter that was finally sold was exported at 50 to 54 cents 
a pound, which would be a loss of 30 cents to Commodity Credit. I do 
not remember the amount, but it seems to me it was around 125, 140 
million pounds. But I am not sure ; you can get this from the Depart- 
ment. 

Mr. Lyman. A 30-percent loss on what ? 

Mr. Palmby. a pound, I estimated in my judgment. 

A No. 4 item which I must also list is that the number of dairy herds 
at that time were really diminishing in number very rapidly, and this 
is an important item, because I looked upon Secretary Hardin and the 
Under Secretary, Campbell, as being better authorities in the dairy 
industry than I. I would not be so modest on all commodities. They 
anguished a good deal about that there was a diminution of herd num- 
bers, even though many herds were getting much larger, that there 
should be a sufficient incentive to keep production coming or sooner or 
later we would run into a dairy shortage in this country. 

I believe I have listed about all the things that I remember that 
strike me as being policy consequence at that time. I mention these four 
items because they w^eighed rather heavily on us, I think weighed more 
heavily on the two gentlemen I mentioned. 

So, finally, leading up to the day when the decision was made, I had, 
as I remember, cleared that decision with the Office of Management 
and Budget. I believe it was Don Rice at the time ; he was the man I 
worked with. It was their recommendation, along with the Council of 
Economic Advisers, because they also almost always had an input on 
these price support decisions regardless of commodity. And they con- 
curred in that price support staying where it was, $4.66, I believe you 
said it was. And 0MB looking at it largely from the fiscal standpoint, 
and the Council of Economic Advisers perhaps more from the stand- 
point of the statutory intentions of the act itself, to insure an adequate 
supply of dairy products. 

Mr. DoRSEN. This information was presented to the board in one 
form or another and was known by the board prior to the March 12 
decision ? 

Mr. Palmby. What decision ? 



7133 

Mr. DoRSEN. Well, these considerations, including the corn blight 
and other factors ? 

Mr. Palmby. They were all good students of agriculture, certainly. 

Mr. DoRSEx. Within the Department of Agriculture, do you know 
of the procedure by which the recommendations in the ASCS was 
made and transmitted up through the lines to the Commodity Credit 
Corporation ? 

Mr. Palmby. At that time, I cannot speak for today, there has been 
at. least up to that time a historical pattern of doing these things in 
what I think is a very acceptable and very businesslike manner. The 
Commodity Credit Corporation operated on the basis of dockets as 
per the custom. 

A docket on this particular subject was prepared and the docket 
contains the economic justification. It contains an opinion by counsel 
consistent, giving an opinion whether it is or is not consistent with the 
language of the act. And that docket goes through what we call the 
preboard clearance, and the preboard members, on what I call this 
preboard, for lack of a better word, are not policy people. They are 
simply civil servants and what I call qualified technicians in the 
Department. 

Mr. DoRSEN. Were you aware of any substantial controversy within 
the Department of Agriculture as to the appropriate supply level — 
the price support level ? Excuse me. 

Mr. Palmby. No ; I was not. And I did tell you this, and I want to 
repeat it again. But it was my personal feeling that Secretary Hardin 
anguished a good deal on this. They can speak for themselves, but it 
is my personal feeling that he and to a degree the Under Secretary 
did have a good deal of anguish on this matter. 

Mr. DoRSEN. Is what you are saying, then, this was more in the 
nature of anguish on the part of the Secretary, rather than a source of 
controversy within the Department? 

Mr. Palmby. I am not aware of an}- controversy. You understand, 
nobody ever sees these things exactly alike. During my tour of duty, 
I certainly never discouraged anybody from telling me I was crazy or 
telling me I was wrong. The best inputs are not good enough on some- 
thing like this. 

Mr. DoRSEN. In addition to Mr. Rice, what officials in the Depart- 
ment of Agriculture on a staff level, as far as you knew, participated 
in the decision and gave you input on the basis of which you parti- 
cipated in the decision ? 

Mr. Palmby. You are speaking now of the agency that reported? 

Mr. DoRSEX. That is correct. 

Mr. Palmby. The docket originated in the dairy division and came 
on up through the Associate Administrator and Administrator of 
ASCS. It is those two gentlemen that I dealt with ; namely, Mr. Frick 
and Mr. Brunthaver. 

If you ask me which one the more, I don't remember, because an 
associate administrator meant to me just what he is. He is an asso- 
ciate. I do not recall which one of those two that I worked with more 
on this docket. 

Mr. DoRSEN. Do you recall any other significant events that were 
connected with the price decision announced on March 12, 1971, on 
the manufactured dairy products ? 



7134 



than what would be normal for that time of the year. I was aware 
that there was some correspondence at the end suggesting that the 
price support be at different levels, most of it, as you would expect, at 
a higher level, of course, than what was announced, and this came from 
various quarters. AMPI, I would think there was probably more cor- 
respondence from them, although the National Milk Producers, as I 
recall, had some correspondence in on it. Believe me, it was 3 years 
ago. I do not consider that really unusual at the time you set 
support price levels. 

Mr. DoRSEN. I have marked as exhibit 1 a two page letter dated 
February 12, 1971, or a copy thereof. 

Mr. Palmby. What date ? 

Mr. DoRSEN. February 12, 1971, from the National Milk Producers 
Federation, what appears to be a copy of a reply by you to the 
secretary of the federation. 

I would like you to take a look at it and see if you can identify 
those two documents. 

[Whereupon, the document referred to was marked Palmby ex- 
hibit No. 1 for identification.*] 

Mr. LymAn. Your question is whether he can identify this. 

Mr. DoRSEN. Yes, can you identify those documents? 

Let me put it a different way. Does that appear to be a letter that 
you received, and a copy of a letter that you sent? 

Mr. Palmby. First of all, it is to Secretary Hardin. The reply seems 
to me that it probably is accurate. I also note that my deputy's name 
is on here, which is quite often the case, that he review^ed it before I 
signed it. It looks perfectly logical to me. That is all I can say about it. 

Mr. DoRSEx. Is this tvpical of the correspondence that was received 
during that period, would you say ? 

Mr. Palmby. It is typical of one side of the correspondence. You 
see, I cannot say for sure whether we received correspondence, for 
instance, from the American Farm Bureau Federation and Land 
O'Lakes, but I — but these two. Land O'Lakes being a Minneapolis 
cooperative, it is my memory that the American Farm Bureau Feder- 
ation and Land O'Lakes were in favor of continuing the price-support 
level at the present level. You know how farm organizations — maybe 
you don't. I would suspect that there are other farm organizations 
that sent in similar letters, but I don't remember. But that is very often 
how the lineup quite often was. 

Mr. DoRSEN. Is it fair to say that a number of farm organizations 
supported a higher level than $4.66 per hundredweight where other 
organizations were satisfied, were in favor of $4.66 level ? 

Mr. Palmby. Yes. I want to paint this picture a little more. As I 
reread that letter, there was a transition taking place that continues 
to take place. One, of course, butter consumption per capita was going 
down. Cheese consumption was going up. I believe the letter states that 
the surplus was in butter and nonfat, and one school of thought by 
well-meaning people on the outside, producer groups, was that the 
marketplace is functioning, cheese consumption is going up. Conse- 
quently there will be a move towards more cheese production out of 
butter production. So there was one good school of thought by well- 

*See p. 7152. 



7135 

meaning people, don't fool around with the price levels. Let the market 
do this. The other school of thought is, we need the guarantee as an 
incentive to be sure that there is an adequate supply. 

I would hasten to say, as one gets more mellow, both sides have 
logical argimients, generally by well-meaning people. 

Mr. ScHOCHET. Mr. Palmby, were you familiar with the Interagency 
Dairy Supply Estimates Committee ? 
Mr. Palmby. I was aware of it. 

Mr. ScHocHET. Could you please explain for the record what its 
function was? 

Mr. Palmby. I would rather you would get it from somebody else. 
I am not being coy when I say this. 

Mr. ScHocHET. Could you just please, then, state the nature of your 
awareness ? 
Mr. Lyman. "What was that ? 

Mr. ScHocHET. The Inter- Agency Dairy Supply Estimates Com- 
mittee, that was the official title. 

Mr. Palmby. This is a true civil servant body from within, true 
technicians or civil servants, call them what you will, who are pooled 
from different agencies as the Economic Research Service, I believe, 
the Statistical Reporting Service, I believe the Agriculture Market- 
ing Service. Their function is one of projecting supply, demand, or 
disappearance. Their findings and their recommendations are widely 
used by policy people. I use them myself. 

Mr. ScHOCHET. Is this preboard clearance of which you were 
speaking ? 

Mr. Palmby. No. 

Mr. ScHocHET. Could you please distinguish between the Supply 
Estimates Committee's functions and the preboard clearance function ? 
Mr. Palmby. They served two different functions. The Supply 
Estimates Committee is a long-standing group within the Depart- 
ment that is set up to utilize the best expertise there is within the 
Department to project the supply and demand requirements of agri- 
cultural commodities. The preboard docket committee that I am talk- 
ing about is a group that also had been set up for a long time to 
review a docket for technical sufficiency, and then finally working with 
counsel for legal sufficiency to be presented to the board for policy 
determinations. 

Mr. ScHOCHET. Who would have been the members of the pre- 
board clearance group ? 

Mr. Palmby. I believe the gentleman who was chairman was 
a man by the name of Richard Moody. He has since retired. I believe 
he was still there at that time, and he had held that function for many, 
many years, through several administrations. 

The people that made up the group, that I called the preboard 
group, were not only people who prepared the docket in ASCS, but 
also representatives from other agencies, because other agency inter- 
ests — they are interested in what is happening in the price support 
programs. 

If I. may give an example, for instance, the Foreign Agricultural 
Service has the expertise on the demand requirements from overseas, 
and is there going to be an outlet for x volume of exports or not? 



7136 

And so this is the type of tiling that was all discussed in this pre- 
board docket. 

Mr. ScHOCHET. Is it proper then, to state, to yonr recollection, that 
in this instance the preboard clearance group approved the recom- 
mendation of the $4.66 level? 

Mr. Palmby I would not put it that way. 
Mr. ScHOCHET. They did not disapprove of it, did they? 
Mr. Palmby. No. That is not a policy group. What I quite often 
did, particularly in this type of sensitive policy decision, was to have 
the preboard supply the costs. No. 1, of maintaining the price sup- 
port level at this level, or at this level, or at another level. No. 1, the 
cost. No. 2, the production response, No. 3, the consumption response, 
because this is the kind of information that very frankly I would have 
had to have had to talk with the Office of Management and Budget 
and Council of Economic Advisers. 

So, the preboard is a working group and it was really not their 
role, even to make recommendations, but to supply the information 
for policy determinations. 

Mr. SciiocHET. This information on cost, productions, and con- 
sumption responses at different levels 

Mr. Palmby. Yes. 

Mr. ScuocHET [continuing]. Was prepared and given in the 1971 
period ? 

Mr. Palmby. We had it as we made the decision. 
Mr. ScHOCHET. Was it an input into your decisionmaking? 
Mr. Palmby. Yes. If I could add one more thing, I only recall 
from memory, but it seems to me that it was the projection at this time 
to move up to about 85 percent of parity, which I believe was $4.92 or 
$4.93 at the time, from $4.66, w^ould cost somewhere near $100 mil- 
lion more money. To a degree, this reflects the anguish, I say, in my 
opinion, that the Secretary was going through. 
Mr. Lyman. "Wliat was\hat? 

Mr. Palmby. About $100 million more, because, as I said, the best 
judgment is not good enough on these matters because there was 
this feeling that with the trend that was taking place in the dairy 
industry, that No. 1, the added cost would not be that much more. 
No. 2, the higher support level is necessary to bring forth the needed 
production and to keep dairymen in business, not necessarily looking 
at 1 year. And I would say, ironically, that I think that the Secre- 
tary was more right than t was on this matter, because of what has 
now happened to dairy production. This is obvious for anyone to 
see. Our cheese consumption continues to go up on the trend that I 
mentioned to you earlier, and actually our importation is becoming 
substantial now. 

Mr. ScHOCHET. When you mentioned as to added costs of $100 
million, are you referring to costs to the CCC ? 

]\Ir. Palmby. Let me clarify that. That does not mean an out- 
right loss. If it is an accumulation of butter and nonfat, if that is 
the disposal cost, it of course woyld lessen. 

Mr. LvisrAN. You said, Mr. Palmby, that the Secretary was more 
right that you were. It is not clear on this record what you mean as 
to what your position was at the time. 



7137 

Mr. Palmby. I told you that the Secretary anguished. I should 
have put this — that his anguish had proved to be quite well founded. 
It was my feeling at the time, as it was by the rest of the board mem- 
bers, but not quite to the degree of my own, that by maintaining it at 
the $4.66, sufficient production would be forthcoming, and that the 
trend toward increased cheese production at the expense of butter 
would continue to take place. 

Dr. DoRSEN. Was part of the input that led to the Secretary's 
anguish political pressure or contact by Members of Congress? 

Mr. Palmby. He can best speak for himself on that. I find it diffi- 
cult to speak for him on tliat. Obviously there was great interest 
on the Hill, a great deal of pressure on the Hill. 

Mr. DoRSEN. And was this pressure that was discussed from time 
to time within the Department of Agriculture at your level and 
higher ? 

Mr. Palmby. Of course. 

Mr. DoRSEN. You also indicated that the Secretary may have been 
right in terms of his anguish. 

Is it what you are saying that, based on subsequent events, the facts 
turned out that a higher price level was not as costlv as was antici- 
pated? 

Mr. Palmby. Yes. I do not have those cost figures here. Certainly 
they are readily available. A^Hiat I had more in mind was the fact that 
dairy cow numbers have continued to go down really at an alarming 
rate in this country. As th^ result of that, we are turning more and 
more to foreign supply and the imports have gone up. 

Mr. DoRSEN. As far as the data within the Department of Agricul- 
ture was concerned, that all led, in your opinion, at maintaining the 
level at that time of $4.66. 
Is that a fair statement ? 

Mr. Palmby. That is a fair statement. That is right. But I want to 
say again that there is particularly in the manufacturers' dairy price 
support program, and the trends that have been taking place and the 
trends that were quite apparent at the time, that believe me, there is a 
good deal of room for well-meaning people with their best judgment 
that they have, there is a good deal of room for disagreement. 

Mr. DoRSEN. To return to the $100 million figure which I think you 
explained, I gather that that figure does not take into account added 
possible costs to the private sector in addition to the CCC. 
Is that correct ? 

Mr. Palmby. That is correct. To the extent that it would he effective. 
Do not jump at conclusions here because I think that you will find — • 
I have not researched this, but I think you will find that the increased 
level of price support had a minimum impact on the price of cheese 
because cheese was already above support prices. 

Mr. DoRSEN. At least some of the products were resting on the price 
support level. 

Mr. Palmby. Of course. 

Mr. DoRSEx. I would like to move ahead now to another unportant 
date: namely, March 23, 1971, which according to testimony and rec- 
ords was the date of two meetings at the White House, a morning 
meeting attended bv Government officials and the dairy industry rep- 



30-337 O - 74 



7138 

resentatives, and an afternoon meeting inA^olving just Government 
officials. 

Did you attend either meeting ? 

Mr. Palmby. I attended the one with the dairy industry group in 
the morning. 

Mr. DoRSEN. Prior to that meeting, in the period March 12 through 
March 23, do you recall any significant events or discussions in the 
Department of Agriculture or in the Government concerning the dairy 
industry problem or the price support level decision ? 

Mr. Palmby. Yes, because — and I talked before to this — the items 
that I recall that we discussed were how we would respond in hear- 
ings in the event that there would be hearings on tlie several bills that 
were introduced by the Members of the Congress, and while every 
Government witness as a matter of habit said he was delighted to 
appear before the respective committee, I never enjoyed testifying and 
defending price-support decisions. It was always tough. So that was 
really the framework or the frame of reference that I remember that 
the discussions took place in staff meetings during that period of time. 

Mr. DoRSEN. Was there any feeling that the price-support level 
would be changed prior to the April 1 effective date ? 

Mr. Palmby. Tliere was not on my part. 

Mr. DoRSEN. Were you aware of any such sentiment or discussion 
involving anybody else in the Department ? 

Mr. Paijviby. No. 

Mr. DoRSEN. Up until the March 23 meeting, were you aware of any 
growing dissatisfaction with the March 12 decision ? 

Mr. Palmby. To the extent that Members of Congress were climb- 
ing on the bandwagon to make it mandatory to increase the support 
price, T was certainly aware of that, and it was a worry. 

Mr. DoRSEN. A worry in what sense ? 

Mr. Palmby. I did not want to see mandatory legislation that it be 
pushed up to 90 percent of parity. It was my feeling that it would 
be devastatingly bad for the dairy industry. 

Mr. DoRSEN. Were you familiar in any detail with the bills that 
were introduced at that time ? 

Mr. Palmby. Only as I remember them. My memory does not serve 
me too well here. I believe the vast majority of those bills would make 
it mandatory to support manufactured daiiy products at 90 percent 
of parity. I don't remember the time period, a 1 or 2 years of limita- 
tion or not. 

Mr. DoRSEN. You may be incorrect in that, I think all but two jVIem- 
bers of the Congress supported bills that would make it mandatory 
at 85 percent for the following year, but I think the record will speak 
for itself. 

Mr. Palmby. I am only quoting from memory. If you say it is 85, 1 
certainly don't question it. 

Mr. Lyman. You said 75 ? 

Mr. Palmby. The $4.66 would figure out at about 80 or slightly 
under as of April 1. 1 believe that's right. 

Mr. DoRSEN. Could you describe as best you can what occurred at 
the March 23 morning meeting ? 

Mr. Palmby. First let me say, as I remember from the Department, 
in addition to the Secretary and the Under Secretary. Assistant Secre- 



7139 

tary Lyng was there and the Congressional Liaison, Bill Galbraith, if 
there are others, I do not remember. 

Mr. DoRSEisr. Excuse me. 

Did you prepare any memorandum or other document for the Presi- 
dent or the President's aide in connection with this meeting ? 

Mr. Palmby. Not to my memoi-y. I was invited to the meeting on a 
very short notice. I had not known that there was going to be a meet- 
ing. I just cannot believe that I helped participate in preparing any 
document. 

Mr. DoRSEN. Do you recall who was present from the dairy industry 
at this meeting ? 

Mr. Palmby. No, but I think their names have been in the paper. 
I say to you, I was not well acquainted with that dairy group. I have 
already explained that. 

Mr, DoRSEN. Did you know any of the persons who were at the 
meeting from prior contacts or conversations or meetings ? 

Mr. Palmby. If I saw the list I could tell you which ones I know, 
I just do not feel that my memory is good enough to tell you who 
those people were. 

Mr. DoRSEN. Let me ask simply about two, Harold Nelson. 

Mr. Palmby. I knew Harold Nelson. 

Mr. DoRSEN, Did you know David Parr ? 

Mr, Palmby, I did, 

Mr, DoRSEN, How extensive were your contacts with these two gen- 
tlemen? 

Mr. Palmby. Very, very limited. In fact, I am quite positive that 
they were never in my office, I would run into them on a couple of 
occasions in the Secretary's reception room. We called it the glass 
cage. "WHiether they were there at that time to see the Secretary or 
the Under Secretary I do not know, 

Mr, DoRSEN, Did you ever attend any meetings with either of 
fhem, at which the price supnort level was discussed, other than the 
meeting; that we are about to discuss ? 

Mr, Palmby, I did not, 

Mr, DoRSEN, Please tell us to the best of your recollection what 
occurred at the March 23 meeting ? 

Mr, Palmby, As I have stated before, when your staff visited on this 
matter, the President made the usual, w^hat I will call nicety remarks, 
and the one thing that particularly sticks in my mind was that the 
President, if I recall correctly, asked in a couple of different ways 
what assurance they could give of restricting or not overproducing, 
I guess is a better word, dairy products; that in the event that the 
support price had been set up at a higher rate. And it was a general 
comment l)y several of those speaking, and they were representatives 
from several States as I remember ; that it was their feeling as they 
expressed it, that overproduction would not be a problem. That was 
the ofist of the conversation as I recall. 

Mr. DoRSEN. Were any reasons given as to why it would not be a 
problem? 

Mr. Palmby. Yes. There is contained in the Agriculture Act of 
1970, which was amended in 1970, a provision— I believe it is called 
the dairy basis provision. This provision really allocates a great 
amount of power to what I call a milkshed area, and actually it is 



7140 

tantamount to a license to produce, and if administered to the ex- 
treme tiojhtness, it could conceivably control production. 

Mr. DoRSEN. Are you familiar with the mechanics of how this base 
system ^oes into effect ? 

' Mr. Palmby. No, I do not. That was not under my jurisdiction. 
That is the reason that I am having trouble with it. I frankly can- 
not tell you. 

Mr. DoRSEN. Are you familiar with how effective such a system 
is in practice ? 

Mr. Palmby. No ; I do not. I would rather not comment. 

Mr. DoRSEN. You would defer to other experts as to the feasibility 
of that as a solution to the President's concern. 

Mr. PAL:^rBY. Yes, That was being administered under really the 
Consumer Marketing Service that reported to Assistant Secretary 
Lyng. I had enough worries of my own. I never did understand the 
delicate features of this basic plan. 

Mr. DoRSEN. AVas there any suggestion at that meeting that the 
price-support decision might be reconsidered or the level changed? 

Mr. Palmby. ISTot to miy memory, I thought about this many times. 
I cannot recall that any mention was made that it might be changed. 

]Mr. DoRSEN. I believe vou did tell the staff at an earlier time that 
there was no discussion, in any direct form certainly of political con- 
tributions at that meeting. 

Is that correct ? 

Mr. Palmby. That is correct, not that I heard. 

Mr. DoRSEN. Was there any discussion tliat you heard concerning 
the support that tlie dairy industry wanted to fzive the President or 
had given the President or was prepared to give to the President ? 

INIr. Palimby. I believe when the President made his — what I call 
nicety remarks, opening remarks is perh^aps a better term, that he 
thanked this group for their support. I am going into detail a bil 
here. 

This group did support the Agriculture Act of 1970. It was not 
easy to get agricultural legislation at that time, and I worked very 
hard working with the Congress to get the Airriculture Act of 1970 
myself. In fact, I was the one responsible. I, too, thanked the many 
groups for helpins!' me work with the Congress to get that lejrislation 
and to work with the Congress. So I am only relatiuij: this to you 
because this group was helpful in securing that part of the Airricul- 
ture Act of 1970, which did help the administration acquire the en- 
tire package of agriculture legislation. 

INIr. DoRSEx. "Was this Avhat you interpreted the President to mean 
when he tlianked them for their support ? 

Mr. Palmby. That is what I interpreted it to mean. 

Mr. DoRSEx. Were vou aware of anv disc\issions between the repre- 
sentatives of the administration and the President or tlie dairv indus- 
try concerning contributions to the President's reelection effort at that 
time. ? 

Mr. Palmby. No. 

Mr. DoRSEx. That was not somethinc; that vou coukl haA^e taken 
into account when you considered what the President's remarks meant. 

Mr. Palmby. It was the furthest from niv mind. 



7141 

Mr, DoRSEN. Do you recall anything else that was said at the March 
23 morning meeting? 

Mr. Palmby. No, I do not. 

Excuse me. I will say one thing. After the President left, the Under 
Secretary did quite an eloquent job in many ways of lecturing this 
group a bit on the limitations of Government to help any particular 
sector of agriculture. I remember that. 

Mr. DoRSEN. Was that kind of statement one that was frequently 
made by the Nixon administration officials ? 

Mr. Palmby. Which statement ? 

Mr. DoRSEX. That the limitations — regarding the limitations of 
Government assistance to agricultural groups ? 

Mr. Palmby. It certainly is, and I have heard the same thing in every 
other administration. There is nothing novel about that statement. 

Mr. DoRSEN. The two administrations you were in was the Eisen- 
hower and Nixon administrations. 

Is that correct? 

Mr. Palmby. That is correct. 

Mr. DoRSEN. Is it fair to say that the Republican administrations 
were less prone to have price support levels and involve the Govern- 
ment in agriculture than the Democratic administrations? 

Mr. Palmby. If you had asked me that question 20 years ago, I 
would have said yes. Today I would say no. 

Let me tell you why I say no. The support prices for grains were 
dropped more drastically under the Democratic administration, 1961 
to 1969, than any period in history. I am talking loan rates. I am not 
critical of it. They developed a good program. 

Mr. DoRSEX. What about price-support levels in such products as 
dairy products? 

Is there a difference in philosophy there ? 

Mr. Palmby. If there is, I have not found it because Secretary Bent- 
son got burned, Secretary Freeman got burned, and by being burned, 
the costs just went up in a bubble when the price support, the mcentive, 
was set at too high a level. And I believe in both the Bentson and the 
Freeman yeare they actually had to lower the support price rather 
than to maintain it. I believe you will find that to be true. 

I cannot give you the specific years. So that was a production- 
consumption response. 

Mr. DoRSEN. To expand that one point, at the meeting, the morning 
meeting, was there any indication that you could detect on the part of 
the administration officials as to a weakening of their position on the 
$4.66 level? 

Mr. Palmby. At what meeting? 

Mr. DoRSEX. The morning meeting. 

Mr. Palmby. That morning meeting, no. 

Mr. DoRSEX. Wiat did you do after the meeting broke up ? 

Mr. Palmby. I went back to my office and I have not researched 
whether I went to Kansas City that afternoon or the next morn- 
ing early because I had a meeting in Kansas City. My wife and I were 
going to Kansas City. I am not sure whether I went that afternoon or 
the next morning, and I have not researched it, but I spoke out there 
on the 24th. I think I went out there the afternoon of the 23d, but I 
would not swear to it. 



7142 

Mr. DoRSEN. Do you have records that would clarify that? 

Mr. Palmby. I do not have them. 

Mr. Lymaist. The Department ? 

Mr. Palmby. The Department must have them. You are free to get 
them. 

Mr. DoRSEN. Do you recall any discussions or events between the 
time the March 23 morning meeting broke up and the time you left for 
Kansas City? 

Mr. Palmby. No. 

Mr. DoRSEN". Were you aware, at that time, of the afternoon meeting 
on March 23? 

Mr. Palmby. No. 

Mr. DoRSEX. ^^Hien did you first become aware of it ? 

Mr. Palmby. Quite some time afterward, because, as I stated before 
to staff, I found out about the increase in support prices when it was 
phoned to me in Kansas City by Mr. Frick. 

Mr. Lyman. You did not state it on the record, you stated it to the 
investigators. You may now state it. 

Mr. Palmby. My wife and T were attending the annual meeting of 
the National Grain & Feed Association in Kansas City. I was in the 
program. And, as I left the meeting out there with my wife, I was 
being paged. And I took the phone call in a phone booth in the lobby, 
I believe, of the hotel. And Mr. Frick had told m.e that the price sup- 
port was going to be increased to, I believe, this $4.93 level and that it 
would be announced shortly. 

I believe he called me before the announcement went out. That is the 
first I heard about it. I, at that time, had no'idea that there were future 
meetings, nor would I have any way of knowing. 

jNIr. DoRSEN. Do you recall what time of dav vou received the phone 
call? 

Mr. Palmby. No ; I do not. I tried to check that. I frankly do not 
know. I was in a meeting — I think T was participating in a panel and 
the meeting broke up. If that is the case it had to be somewhere around 
noon, or thereabouts. 

Mr. DoRSEx. It is your recollection that you got that phone call 
before the public announcement of the increase? 

INIr. Palmby. It is my recollection, but I would not be sure of that. 
That was the 25th. 

Mr. DoRSEx. If the decision was announced about noon in Washing- 
ton, would that tend to indicate to you — I do not want to overstate it— 
that you heard tlie information around noon in Kansas City, that it 
was indeed a morning panel that was breaking up ? 

Mr. Palmby. I do not quite ^let your question. 

Mr. Lymax. The meeting at the White House was on the 23d. You 
went to Kansas City either the 23d or the 24th. This meeting was on the 
25th that you were interrupted. It was 2 days after the White House 
meeting. 

Mr. Palmby. Yes. As per custom, again, price support decisions are 
not made when markets are open. Frankly, again, I told you I'm not 
the authority on dairy products that others are. but the price-support 
decisions on dairy products, and tlie release of them, was timed to the 
closing of the cheese market in Wisconsin. 



7143 

Mr. DoRSEN. Do you recall participating in any discussions concern- 
incr the price support level for manufactured dairy products between 
the time of the breakup of the morning meeting on March 23d, and the 
time that you left for Kansas City ? 

Mr. Palmby. No, sir. 

Mr. DoRSEX. Do you know of any such discussions that took place, 



from your own knowledge ? 

]Mr. Palmby. No. 

jNIr. DoRSEN. Did you have any conversations on that subject during 
that period, with Secretary Hardin, Under Secretary Campbell, or 
Assistant Secretary Lyng? 

Mr. Palmby. No ; I did not. 

]Mr. DoRSEX. Dicl you know, at the time, that the matter was being 
reconsidered at all? 

Mr. Palmby. No. 

Mr. DoRSEN. Was that a customary way of reviewing price-support 
decisions ? 

Mr. Palmby. Wliat do you mean by that ? 

Mr. DoRSEX. The fact that you were not at all involved in the de- 
cisionmaking process. 

INIr. Palmby. No. it was unusual, but I was out of town, I would say 
that. 

Mr. DoRSEX. Do you know whether the Commodity Credit Corpora- 
tion was involved in the decision to raise the price-support level to 
$4.93? 

INIr. Palmby. What do you mean Commodity Credit, being involved ? 

]\f r. DoRSEX. The Board, excuse me. 

Mr. Lymax. Do you mean, were tliey consulted ? 

Mr. DoRSEX. Yes. 

]\Ir. Palmby. I have already answered those questions. 

Mr. Lymax. About the increase. 

Mr. Palmby. I have answered that. 

I, as one Board member, was not consulted. I do not know about the 
other Board members. The Commodity Credit Board is nothing but 
Board members, so I am speaking of one-seventh. 

Mr. DoRSEX, For the record, who are the other members of the 
Board ? 

Mr. Palmby. The Secretary is Chairman of the Board by statute. 
The Secretary designated me as President. In addition to that, the 
Under Secretary of — Campbell, was the Director. Assistant Secretary 
Lyng; Assistant Secretary Cowden; the Director of Agriculture Eco- 
nomics, Don Paarlberg; Administrator of ASCS, Kenneth Frick. 

Mr. DoRSEX'. "WHiat were your specific duties as President of the 
Board ? 

Mr. Palmby. I presided at Board meetings, in the absence of the 
Secretary. Tliat is largely it, and it was the flow of documents. It is not 
unlike, really, the public corporation. 

The Secretary of Agriculture is chief executive officer, but the 
president of the corporation acts in his place. And all of the actions 
that are taking place by the Commodity Credit Corporation Board 
bear the signature of the President. 

Mr. DoRSEx. Is it fair to say tliat if a meeting were held, of the 
Board, prior to the public announcement, on March 25 of the price 



7144 

increase, that that meeting would have come to your attention at some 
time? 

Mr. Palmby. Oh, sure. 

Mr. DoRSEN. Did such a meeting come to your attention? 

Mr. Palmby. No. 

Mr. DoRSEX. According to our understanding, the 85 percent of 
parity level works out at $4.92 a hundredweight of manufactured milk. 

Were you aware, during March of 1971 

Mr. Lymak. 1971-72? 

Mr. DoRSEx. March of 1971 — of the particular levels, dollar levels, 
for each parity level? 

Mr. Palmby. First of all, I do not recall what parity was at that 
time, but I discussed this some with your staff before and tried to 
explain the rationale for $4.98 which was the decision that was later 
made. 

The statute calls for a 75-90 percent of parity as of April 1 and it 
could easily be that civil servants in the Department were projecting 
$4.93 to be about 85 percent of parity come April 1. 

Mr. DoRSEN. Do you have an specific knowledge of this ? 

Mr. Pai,mby. No! 

Mr. DoRSEN. Do you know of any other possible explanation for the 
price level of $4.93 as opposed to $4.92 per hundredweight? 

Mr. Palmby. No. 

Mr. DoRSEN. Do you know of any Jiew information that was bi'ought 
to the attention of Secretary Hardin between March 12 and March 25 
decisions that related to the economic desirability using the statutory 
criterion of the particular support level ? 

Mr. Palmby. I know of no new inf onnation, no. 

T know what I call a "rap session." Secretary Hardin operated very 
informally, as I mentioned before, to this group and it was not un- 
common at the close of business that three or four of us would sit 
around and compare notes of how poorly or how good we had done 
during the day. 

And Secretary Hardin made a comment, at least on one occasion, 
that something along the lines that he hoped that that decision was 
right. Again, I am illustrating the anguish that I know that he was 
experiencing, 

Mr. Dorset. He certainly had no high degree of confidence in the 
March 25 decision, is that fair to say ? 

Mr. Palmby. I want to explain another problem. 

Mr. Lymax. You said that — when you say that he hoped that deci- 
sion was right, are you referring to the March 25 decision, or March 12 
decision ? 

Mr. Dorsen. The 12t.h: 

Mr. Lyman. I think your question was probing — March 12? "Wliat 
happened between March 12 and March 25 ? 

Mr. DoRSEX. There was a misunderstanding. You are referring to 
the March 12 decision? 

Mr. Palmby. Correct. 

We were worried, frankly, at that time as to what kind of a com 
crop we would have in 197i because the seed trade was apprising us 
that their quality of seed was not what they would like to have and it 
was not immune from southern corn leaf blight. Anybody, who was 



7145 

Secretary of Ao:ricultiire and the rest of us, for that matter, were truly 
worried about what mifjlit happen to the 1971 corn crop. 

And, remember, corn is "it" in this country, as an agricultural com- 
modity. 

Mr, DoRSEN. Did you have any discussions with Secretary Hardin 
fir Under Secretaiy Campbell concerning the way in which the March 
25. 1971, decision was arrived at? 

Mr. Palmby. No; I did not. 

Mr. DoRSEN. In view of your prior statement concerning Secretary 
Hardin's informality and rap session, can I ask you why not ? 

Mr. Palmby. Yes ; and I can answer. 

T felt that I had pushed pretty hard to keep it at $4.66. And I was 
obviously overn^led. To me, the subject was closed. I had an excellent 
working relationship with Secretary Hardin. I am very fond of him 
as a person, and when it was announced, the subject was closed. There 
was nothing more to talk about as far as I was concerned. 

Mr. DoRSEX. You differentiate that type of amiouncement from the 
]March 12 annomicement? 

Mr. Palmby. I was part of the March 12 announcement. I was not 
part of the later announcement. 

]Mr. DoRSEN. Did you feel excluded from the March 25 announce- 
ment ? 

Mr. Palmby. How yould you feel ? After all, I have seiwed in Gov- 
einment, at that time it approached about 9 years, and I used a little 
swear word out in Kansas City when I found out about it. 

Then, you shake the dust off your suit coat and go back to business. 

Mr. DoRSEN. Was this an unusual occurrence for you not to be con- 
sulted concerning a decision of this importance ? 

Mr. Palmby. Yes. 

Mr. DoRSEN. Can you think of any other instance when it occurred ? 

Mr. Palmby. Yes — one that was not as far reaching. 

I was in Europe at one time, shortly before I left, and with full con- 
currence, we had made a decision on the level and the extent to which 
we would make grain sorghum available within the confines of the 
establishment. 

And, in my absence, I was overniled. I think it happens to every- 
body. 

Mr. DoRSEN. This was certainly one of the few instances and prob- 
ably the major instance that you can recall, is that correct ? 

Mr. Palmby. Yes. 

Mr. DoRSEN. Do you recall when you returned from Kansas City ? 

Mr. Palmby. No ; I do not. I think — I don't Iviiow if I threw that 
note away — do you remember what day of the week the 25th was? 

Mr. ScHocHET. The 25th was a Thursday. 

Mr. Lyman. Would you have something that would indicate it? You 
Avould be able to give that information to them later ? 

Mr. Palmby. I think you can get it from the Departrnent. 

Mr. DoRSEN. It would be in departmental records to indicate when 
you returned? 

Mr. Palmby. Yes. 

Mr. DoRSEN. Was it before April 1 ? Do you believe ? 

Mr. Palmby. Oh, yes. 

Mr. DoRSEN. Do you know of any other instance when the price- 



7146 

support level decision was reversed prior to the effective date of the 
first decision ? 

Mr. Palmby. In our administration ? 

Mr. DoRSEN. Yes. 

Mr. Palmby. No, I do not believe there was. 

Mr. DoRSEN. You are suggesting there may have been one in another 
administration ? 

Mr. Palmby. I would not know. I just would not know. 

I can tell you we came awfully close to one, reversing one, once that 
was on honey. 

Mr. DoRSEx. On what ? 

Mr. Palmby. Honey. 

Mr. DoRSEX. Maybe we should take a few minutes of recess now. 

[A brief recess was taken.] 

Mr. Plotkix. With regard to various dairy cooperatives that would 
be interested in increasing milk price support, is it not true that there 
are certain co-ops, of which Land O' Lakes is one of them, that operates 
on a flat rate for the sale of milk, and that it is not affected particularly 
by price supports? 

Mr. Palmby. I would not agree with that. 

What do you mean by flat rate ? 

Mr. Plotkix. I am not exactly sure because I do not understand the 
economics involved. I was under the impression from another witness, 
that there are certain areas in the country, milk co-ops or however 
you refer to them, that are not as keyed in to the price-support system 
as others, that some sell milk on a flat rate — that is the only phrase 
that I can think of to use — on a flat rate basis that would not subject 
them to the fluctuations of other dairy producers that they may be 
subjected to. 

Mr. Palmby. I hardly feel qualified to respond on that question. 
Certainly there are plenty of people that are more qualified than I am 
on how to respond when you talk about flat rate price. I do not feel 
competent to respond. 

Mr. Plotkix. If the dairy herd decreased at a tremendous rate, 
which apparently it has been doing for the last 20 years 

Mr. Palmby. That is correct. 

Mr. Plotkix. [continuing]. Would it be possible to reach a point 
where having obtained maximum production 

Mr. Palmby. Per cow. 

Mr. Plotkix. [continuing] . Per cow, and having reached the mini- 
mum number of cows to provide the maximum amount of milk that 
we need 

Mr. Palmby. Yes. 

Mr. Plotkix [continuins:]. Would that then create a situation 
where we would not need price supports ? 

Mr. Paliviby. There are two schools of thought. In my judgment, 
yes, you would not need price supports. I have thought for quite a few 
years that the price-support program for manufactured dairy prod- 
ucts could be phased out with a minimum of harm to the dairy indus- 
try. But again, you have well-meaning people on the other side who are 
of course very much married to the price-support concept of manu- 
factured dairy products. So you can get a first rate controversy going 
on this matter. 



7147 

Mr. Plotkin. Can you give me, generally, the reasons why people 
would be opposed to phasing them out if circumstances were as I out- 
lined them ? 

Mr, Palmby. As feed costs again go down, and it should be accom- 
panied by lower prices for beef, where these are competing agricul- 
tural commodities, then it is conceivable that resources might, under 
those conditions, flow back into the dairy industry, and without any 
floor under the price of dairy products, that school of thought says it 
would head the dairy industry, or many dairy producers to bankruptcy. 

Mr. Plotkin. The loss at which the excess butter was sold, and one 
of the factors that we were considering prior to the making of the 
price-support decision for 1971 was that loss, within a general range, 
what the CCC customarily sells surplus dairy products. 

Mr. Palmby. You have to understand the CCC's authority to sell 
surplus dairy products are what I recall restricted for export uses. 
In other words, if they were sold domestically, you would break the 
domestic price and you would accomplish nothing. You would just be 
recycling through the Commodity Credit Corporation, so that the au- 
thority to price commodities competitively in the exDort market is very, 
very broad, and for manv vears, really, the London price of butter, 
in England, which is the big world butter market in that they have a 
very limited butter production of their own, hovered around the 30 
cents or 30 cents plus. So that when a situation developed that they 
actually wanted butter from this country, the New Zealanders asked 
us to sell butter so that the British would not forget how to eat butter. 

When we could get .52 cents, 54 cents, that was considered, at least in 
my judgment, a pretty good price. 

Mr. Plotkin. For export purposes we made money, but in relation- 
ship to the excess butter that was being sold, you would be selling it be- 
low the market price. In this country, you lost money. 

Mr. Palmby. Absolutely. 

And to the extent that 30 cents is a loss, it is a subsidy, it is an export 
subsidy which I in principle abhor. In this particular case, it seemed 
the proper thing to do. 

Mr. Plotkin. Thank you. 

Mr. DoRSEN. Mr. Palmby, when, for the first time, did you become 
aware of the fact that representatives of the dairy cooperatives were 
making political contributions to the President ? 

Mr. Palmby. "V^Hien I read it in the paper. I am not sure that I was 
aware of it until after I left Government. I left Government, as I told 
you, in June 7, 1972. 1 knew it when it first began to be in all the papers 
and I began to suspect that it was true. 

Mr. DoRSEN. I believe you testified that you know Dr. Don 
Paarlberg. 

Mr. Palmby. Indeed, I do. I know him well. 

Mr. DoRSEN. How long have you known him ? 

Mr. Palmby. Eighteen years. 

Mr. DoRSEN. Have you worked with him regularly during that 
period ? 

Mr. Palmby. To a limited deirree in the Eisenhower administra- 
tion. Of course, I saw very little of him in the 8 years of the Democratic 
administration. He was back at Purdue most of that time. He came 
into the Nixon administration early, after the President was first 



7148 

inaugurated. So I would think that he came in in February or there- 
abouts, so I worked with him for over 3 years and rather closely in 
that period of time. 

Mr. DoRSEN. Have you ever had a conversation with Dr. Paarl- 
berg? — let me confine myself to the year 1971- — concerning contribu- 
tions by dairy cooperatives or other representatives of the milk indus- 
try to the President's reelection campaign ? 

Mr. Palmby. I do not recall any such conversation. 

Mr. DoRSEN. Do you recall a conversation in which you told Dr. 
Paarlberg several weeks or several months after the milk price deci- 
sion of March 25, 1971, that the dairy industry political contributions 
were a factor in the decision to raise the price-support level ? 

Mr. Pai.mby. No, sir, I do not recall such a conversation now. 

Could I make a comment ? 

Mr. DoRSEN. Please do. 

Mr. Palmby. I reflected on this a good deal, as you would expect. 
Don Paarlberg and I ofRced rather closely together in the Department, 
and as per custom we both attended the Secretary's policy staff meet- 
ings, sometimes every day of the week, sometimes 2 or 3 days a week, 
and we quite often walked down the hall together back to our offices. 
I spouted off more to Don Paarlberg than anybody else in the De- 
partment because Don was, and is, a great distinguished economist 
of great experience, and he and I agreed on many issues. You must 
remember at this time that when we were peddling butter around 
the world and increasing, and then in turn the decision was made to 
increase the price support, that it bothered me on a couple of counts, 
one that I have not mentioned. That is, in my capacity at that time 
I quite often was either negotiating informally or to a degree formally 
with the Common Market and the United Kingdom people on several 
of their agriculture policies. Theirs is what is known as a common 
agriculture policy, and it provides for high target prices or high price 
supports, in our terminology, and under normal times, and what they 
were doing at that time, would pay very heavy subsidy to export grain 
or other items that were in surplus, occasionally butter, not at that 
particular time. 

T had one ambition in serving my Government at that time, and I 
still have that ambition. That is, that finally, under the auspices of the 
general agreement of tariff and trade, or under some multilateral 
framework we will all grow up enough in our agricultural policy that 
we agree not to subsidize exports. 

And I could easily have spouted off to Don and said I find this ter- 
ribly embarrassing because here I am pleading, I am criticizing, I am 
talking to our European friends about their lousy policy, about paying 
excessive subsidy, exporting barley, wheat, and now we got caught — 
at the same time increase their internal target prices, so that the dif- 
ferential between target price and export price widens. And so here is 
a case where we did the same thing. 

I for 1 minute would not deny that I spouted off along these lines 
with Dr. Paarlberg, but as far as any reference or any knowledge that 
I had on contributions, I have told you before what it is. 

Mr. DoRSEN. If he made the statement which I indicated to you 
Dr. Paarlberg stated to me, it would not have reflected knowledge on 



7149 

your part but merely a state of mind concerning the wisdom of the 
decision and other considerations ? 

Mr. Palmby. Phis one other thing. I am sure that you are aware 
of the famous March meeting of this dairy group in Chicago. Was it 
1970 or 1971, 1 am not sure. 

Mr. DoRSEN. In March ? 

Mr. Palmby. The famous fly-in meeting. 

Mr. ScHOCHET. That Secretary Butz spoke at ? 

Mr. Palmby. The dairy convention in Chicago. 

Mr. DoRSEN. The dairy conventions are basically in September. 

Mr. Palmby There was a convention where roughly 40,000 dairy- 
men, according to their figures, were flown in. There were a great 
number of Congressmen and Senators that were flown out — attended. 
T don't know if they were flown out. I was invited. I refused to go. 
Some of our people in the Department went. I do not know who, but 
I was uneasy about attending that convention, and with the general, 
let's say the general attitude regarding — I used the expression myself 
a couple of times — it looked like when they came into town, $20 bills 
were dropping out of their pockets. Frankly, they scared me. It is 
that simple. 

Mr. DoRSEN. If you were, as you indicated, dissatisfied with the 
price- support decision and other policies which the dairy cooperatives 
at least heavily supported and pushed for, is it likely that you would 
have tied together the March 25 decision and political decisions ? 

Mr. Palmby. Me? 

Mr. DoRSEN. Yes. 

Mr. Palmby. No. I was not working on the campaign. I was not 
going to work in the campaign. I had already at that time thought 
I would not stay around to go through a political campaign. I really 
was not interested. 

Mr. DoRSEN. I am talking about in your own mind, discussing it 
with Dr. Paarlberg. 

Mr. Palmby. Yes. 

Mr. DoRSEN. Would you have been likely to have linked the two 
together ? 

Mr. Palmby. No. I certainly could have linked the free money to- 
gether as regarding what the fees that at least we thought they were 
paying certain Congressmen and Senators to appear in their conven- 
tion on their convention programs. This was common gossip around 
the city. I know I made the comment, as I say again, there seems to 
be a lot of money here. 

Mr. DoRSEN. I was present when Dr. Paarlberg was interviewed. I 
think it is a fair statement that he was quite emphatic in terms of his 
recollection of his conversation with you. 

Mr. Palmby. I suspected that from your phone conversation. 

Mr. DoRSEN. Do you have any explanation as to how he could receive 
the impression he did ; namely, as to the statements you made concern- 
ing the linking of that price decision with the political contributions, 
and second, that it was his impression that you had information that 
you were basing it on ? 

Mr. Palmby. I have given you all I can tell you. That is all. I just 
cannot. 



7150 

I suspected in your conversations with Don Paarlberg he, too, ex- 
pressed some uneasiness on how this group handled themselves on the 
Avhole. That is for him to say, not for me. 

Mr. DoRSEN. Did it ever come to your attention prior to the publica- 
tion of the White House white paper on tlie milk price-support deci- 
sion that it was the President rather than Secretary Hardin who was 
apparently primarily responsible for the March 25, 1971, decision? 

Mr. Palmby. No. To this day I do not really know who was in on 
that decision. I only know what I i-ead in the "White House paper. 

Ml'. DoRSEN. This is a rather general question, but ha\e you read the 
President's white paper on the milk price decision ? 

Mr. Palmby. Not carefully. 

Mr. DoRSEN. The general question was actually going to be, do you 
have any comment on it that you wish to make on the point of view of 
what we haA^e already covered hei-e ( 

Mr. Palmby. I do not think so. 

Mr. DoRSEX. Did it ever come to your attention as to Avhy the deci- 
sions was reversed on March 25, 1971, as opposed to a later date oi- an 
earlier date, for that mattei- 'I 

Mr. Palmby. I discussed this matter with your staff earlier, too. 
The answer is no. I think we went on a bit in detail at that time, that 
through the years in different administrations, language has been 
utilized in the press release by the Secretary, stating that along the 
lines that I will continue to observe the dairy situation, and there 
has been occasions when a commitment Avas made that every quarter 
it Avould be revicAA-ed to see Avhether the proper production is coming 
forth, and to see Avhether the increase should be made. That is as near 
as I can come to ansAvering your question. 

Mr. DoRSEN. Were you at all involved in the decision in late 1970 or 
January 1, 1971, concerning import quotas for dairy products? 

Mr. Palmby. I Avas the USDA representative together with staff 
from the Department, along with other departments of Government, 
in putting together the options for Presidential consideration. 

Mr. DoRSEN. Do you haA-e any knowledge as to hoAv the final deci- 
sion Avas made ? 

Mr. Palmby. No. 

Mr. DoRSEN. Did you evei- see or hear anytliing about a letter from 
Patrick J. Hillings to the l^resident, dated December IB, 1970. Avliicli 
related to both impoit quotas and campaign contributions ? 

Mr. Palmby. No. 

Mr. Lyman. Is this the first you haA'e heard of that? 

Mr. Palmby. No. I read it in the paper. 

Mr. DoRSEN. I gather that Avas fairly recently. 

Mr. Palmby. Not long ago. 

Mr. DoRSEN. Mr. Schochet ? 

Mr. Schochet. No questions. 

Mr. Plotkin. For the record, I Avant to clarify. T also attended 
the intervicAv Avith Dr. Pearlberg, and although T do not take issue 
Avith Avhat Mr. Dorsen said Avith regard to Avhat Mr. Paarlberg said, 
I myself did not get the impression that he Avas implying that you 
had specific knoAvledge of any contributions that Avould have in- 
fluenced the decision of March 25. 

HaA-e you spoken to Dr. Paarlberg subse(]uent to the meeting on the 
issue of exports? 



7151 

Mr. Palmby. No. I listened to Dr. Paarlberg speak right after the 
first of the year in New York, at an Economics Association meeting. I 
shook liis hand. That is the only time I have seen him for at least 7 or 8 
months. 

Mr. I 'MAX. You have not discussed the subject of your testimony 
witli him or talked to him about it. 

Mr. Palmby. No. 

Mr. Plotkin. Thank you. 

Mr. Palmby. My comment is this, and tliis has to do with presum- 
ably the Paarlberg conversation. I guess we all have some human 
weaknesses. I like to blow once in a while, particularly when I feel 
that I am under undue pressure, and poor Paarlberg was the one that 
I had, the best listener I had, at the time that I was in the Department, 
and if, in fact, I made mention of the level of the manufactured dairy 
price supports and moneys from that group, if he says I did, I believe 
I did, and I can tell you, if I did, it was made in a cynical manner, and 
I can be pretty cynical at times. That is my explanation. 

Mr. Plotkix. Do you tend to think of yourself less as having been 
a political appointee and more as a public servant when you held these 
offices ? 

Mr. Lymax. I guess he is asking you if you are a professional. 

Mr. Plotkix. I do not have any doubt of that in my mind. 

Mr. Palmby. I considered myself a very highly qualified political 
appointee. 

Mr. Plotkix. Did you ever feel some kind of resentment about the 
politics that often affected certain types of decisions you made ? 

Mr. Palmby. A professional on these matters in implementing and 
carrying out price-support programs are against the grain, quite often, 
of a true professional, but on the other hand, the business of govern- 
ment is a matter of compromise between the legislative branch and the 
executive branch, particularly in securing legislation, and I think I 
understand that. And probably the biggest thrill I had in my tour of 
duty was working on the Agriculture Act of 1970 with the House 
Agricultural Committee and later the Senate and conference commit- 
tee, and I know I made some lifelong friends of both committee mem- 
bers on both sides of the aisle. 

Mr. Plotkix. Would you say that your professionalism kept you 
away from the convention in Chicago of the dairymen ? 

Mr. Palmby. I was not interested in going to that convention. 

Mr. Plotkix. May I ask why ? 

I would like you to elaborate just a little bit more on that. 

Mr. Palmby. I did not believe in their method in spending the 
amount of money they did. It was a pretty blatant show of free 
spending. 

That is their business, not mine. 

Mr. Plotkix. Would I be correct in assuming that you felt that that 
type of conduct would give the appearance of trying to buy people's 
support? 

Mr. Palmby. It is unbecoming. I will put it that way. It is 
unbecoming. 

Mr. Plotkix. Thank you. 
Mr. DoRSEx. Thank you very much. 

[Whereupon, at 12 :iO p.m.,"^the hearing in the above-entitled matter 
adjourned.] 



7152 
Palmby Exhibit No. 1 

March 9, 1971 

Mr. Patrick B. Healy, Secretary 
National Milk Producers Federation 
30 F Street, N. W, 
Washington, D. C. 20001 

Dear Mr. Healy: 

Thank you for your letter of February 12, 1971, urging that the dairy price 
support level for 1971-72 be set at 90 percent of parity and that it be 
annbunced as soon as possible. 

While we realize that farm costs have risen. It Is also true that milk pro- 
duction has been Increasing over year-earlier levels for more than a year. 
This Is due to the continued increase In production per cow and a decrease 
in the rate of decline in cow numbers. In the five prior years, increasing 
production per cow did not effect the decline in cow numbers. 

Conmiercial consumption of milk and its products has not Increased suffi- 
ciently to match the Increase in production. Market removals by Commodity 
Credit Corporation have been substantially greater so far this marketing 
year as compared to last year. CCC has purchased 5.9 billion pounds of - 
milk equivalent through February 28, hompared to 4.0 billion pounds in the 
same period a year earlier. The product of greatest concern to us is 
butter. CCC purchased 249 million pounds in the first eleven months of the 
marketing S^ear compared with 165 million pounds a year earlier. 

In attempting to determine the level of support which will assure an ade- 
quate supply for the next marketing year, we will certainly be concerned 
over the increase in farm costs; but, we must also consider developments 
in production, consumption, stocks, price*, and program costs. 



.> 



.^1 



Sincerely, 

Clarence D. Palmby /'//j 

Assistant Secretary ^'J 



17 -W 

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7153 



AGR. STAB. & CONS 

■-,□.,. ' fAT«l« .. HEAiy. S.cr.to 



a. 




l\ATiOWAL MSLK PROOyCEIlS FEDEIIATIOR 

30 F STREET NORTHWEST • • * • WASHINGTON. D. C. 2000 

February 12, 1971 



Honorable Clifford M. Hardin 
U.S. Department of Agriculture 
Washington, D.C. 20250 

Dear Mr. Secretary: 

VJe respectfully urge that you make announcement at the earliest 
possible date establishing the^pricesupport fo r man ufacturing 
mllk_at 90 percent of parity for the marketing year beginning 
April 1, 1971. 

The present price support level of S4.66 per hundredweight of 
milk, when made effective April 1, 1970, x^as about 85 percent 
of parity ^ Since that time, virtually all cost Items faced by 
dairy farmers have Increased and the price support of $4.66 by 
April 1, 1971, will approximate 80 percent of parity. The decrease 
in the percentage of parity represented by the $4.66 support price 
is evidence that farm costs have been increasing relative to prices 
received. 

Dairy farmers have been particularly disadvantaged because of the 
severe shortage of capable farm labor at ever-increasing x^age rates. 

The corn blight also has had its effect on the availability and 
price of feed grains, the results of which will be felt in the next 
marketing year if, for no other reason, because of the shortage of 
blight-resistant seed corn. 

It is recognized that milk production in 1970 was moderately higher 
than in 1969. It is estimated by the U.S. Department of Agriculture 
that milk production for Calendar 1970 was 117.4 billion pounds. 
This, however, represents a substantial reduction from the high point 
In milk production, which reached 127.0 billion pounds in 1964. 



/-> 



30-337 O - 74 - Bk. 16 - 15 



\ 



7154 



2, Honorable Clifford M. Hardin, 2/12/71 



On a per capita basis, milk production declined in Calendar 1970 
and was the lowest on record. The United States population is 
increasing at a rate of over 3 million per year, and there is 
growing concern that the population is not meeting recommended 
levels of nutrition, particularly among the young and the unem- 
ployed. 

There is a serious question as to whether or not milk, production 
can be maintained at present levels. The number of farms milking 
cows constantly is declining. This decline has been offset thus 
far by increased production per farm, but this entails more hired 
farm labor and a greater investment, both of which make dairy 
farming more expensive and hazardous . 

The number of milk cows on farms January 1, 1971, was 12.4 million, 
a reduction from a year ago and the lowest on record in over a 
century. 

During the past year, the Commodity Credit Corporation will have 
purchased modest quantities of dairy products to support the price 
of milk. The quantities purchased, however, have been less than 
adequate for the School Lunch Program and for food distribution 
programs, when the quantities distributed are compared to those 
made available in recent years. 

Furthermore, it should be noted that imports of dairy products for 
Calendar 1970 were equivalent to about 1.9 billion pounds of milk, 
an increase of about 20 percent from 1969. 

By Presidential Proclamation, import quotas were increased in an 
amount representing over 26 million pounds of milk for Calendar 1971. 

An increase in the price support for manufacturing milk to 90 per- 
cent of parity is necessary to maintain dairy farm income and to 
maintain sufficient milk production for U.S. consumers. The amount 
of money required to purchase dairy products to maintain a price 
of 90 percent of parity will not be excessive, and will be needed to 
further the nutrition efforts of the United States. 

Again, we respectfully urge that you make an announcement at the 
earliest possible date, increasing the price support level for 
manufacturing milk to 90 percent of parity. 



M* B. Healy, Secretary ^ 
NATIONAL MILK PRODUCERS FF.DERATIONj^ 



THURSDAY, JANUARY 31, 1974 

U.S. Senate, 
Select Committee on 
Presidential Campaign Activities, 

Washington^ B.C. 
The Select Committee met, pursuant to notice, at 3 p.m., in room 
1418, Dirksen Senate Office Building. 

Present : David Dorsen, assistant chief counsel ; Alan Weitz, assist- 
ant majority counsel; Don Sanders, deputy minority counsel; Ben- 
jamin Plotkin, minority investigator. 

Mr. Dorsen. We are about to proceed with an interview of Mr. 
Haldeman. This is being taken verbatim, but is an unsworn statement 
of the witness. 

Mr. Weitz, will you please proceed. 
Mr. Weitz. Thank you. 

Mr. Haldeman, let me direct your attention to 1969. Did there come 
a time when Mr. Kalmbach discussed with you contacts he was having, 
or communications he was having, with representatives of some dairy 
cooperatives ? 

INTERVIEW OF H. R. HALDEMAN, ACCOMPANIEB BY FRANK H. 
STRICKLER, COUNSEL 

Mr. Haldeman. I am not able to identify either time or individual 
as to when and how I become aware of the interest on the part of the 
dairy industry or intention on the part of the dairy industry to supply 
contributions. I did at some point become aware of that. I don't believe 
it was in 1969. 1 would expect it was probably in 1970. 

Mr. Weitz. Let me ask you this. Are you aware that the $100,000 in 
cash was delivered by a representative of the dairy industry to Mr. 
Kalmbach ? 

Mr. Haldeman. In 1969 ? 

Mr. Weitz. In 1969. 

Mr. Haldeman. I don't recall that. I am not currently aware of it. 
That is something I may or may not have known at the time, and I 
have no recollection of knowing it. Kalmbach reported some things to 
me, he generally kept me informed on what he was doing 

Mr. Weitz. Do you recall whether in 1969, he asked your advice or 
notified you of any contacts he was having in connection with solicit- 
ing contributions, contributions for the trust account, or whether or 
not they Avere with regard to the trust account in general? 

Mr. Haldeman. I don't know what you mean by the trust account. 
But I have no recollection of any indication that he was soliciting 
or receiving funds in 1969. 

Mr. Weitz. If Mr. Kalmbach has testified in a civil deposition that, 
in fact, he was contacted by Milton Semer, representing the dairy 

(7155) 



7156 

people, in 1969 concerning possible contributions, would that refresh 
your recollection ? 

Mr. Haldeman. No. 

Mr. Weitz. If he has testified that he, in fact, notified you that they 
wanted to make a contribution, and he asked your approval, does that 
refresh your recollection ? 

Mr. Haldeman. Not in terms of 1969, nor specifically Kalmbach. 
I know that I was told by someone at some point that the dairy people 
were planning to provide major financial support. 

Mr. Weitz. But I am talking about really in 1969. You have no 
recollection of it ? 

Mr. Haldeman. No. 

Mr. Weitz. Did you talk with Attorney General Mitchell, do you 
recall, in 1969 about the dairy groups or possible contributions from 
the dairy industry ? 

Mr. Strickler. Mr. Weitz, I am here only as counsel to Mr. Halde- 
man. I would like, if I could, to obtain from you a statement of 
relevancy of this line of questions to the 1972 Presidential campaign. 

Mr. Weitz. Certainly. 

Mr. Strickler. We have been afforded that courtesy by other dis- 
tinguished members of this group, and they have undertaken to ex- 
plain how it does fit into the relevancy point. 

Mr. Weitz. I would be happy to. We have testimony and documen- 
tary evidence that Mr. Kalmbach received $100,000 in cash from the 
representatives of certain dairy co-ops in 1969. And he has testified 
that the money was commingled with funds in his trust account, 
which was a trust account of surplus funds from the 1968 campaign, 
the surplus from which in 1972 was applied toward the 1972 campaign. 
In addition, I think there are various expenditures that he made from 
those funds in the course of his trusteeship, which I think were directly 
related to the 1972 campaign. 

Mr. Strickler. All moneys are fundable, and if anything went into 
this trust fund it is related-^ — 

Mr. Weitz. In fact, that is his testimony, that he was taking funds 
in as a general matter, and that the surplus from that account went 
into 1972. 

Mr. Strickler. I was wondering about your theory. 

Mr. Weitz. It is several theories. It is both as to the disposition of 
the funds, and the disposition of moneys from the funds related to 
the 1972 campaign. And I might add also that there is some testi- 
mony and some evidence that we have gathered that the intent of 
the donors was not particularly toward any one campaign but to tlie 
administration. I think there are really three possible theories. 

Mr. Strickler. And somehow you are relating this to the scope 
of the committee's charter ? 

Mr. Weitz. I think that will cover it. 

Mr. Haldeman. That, in a general sense, is totally consistent with 
my general belief, and with my testimony I think before the Sen- 
ate committee, and also in another interview here, in the sense that 
it was my understanding that Kalmbach had a fund that was the res- 
idue of 1968 in some form; that other funds were added to that over 
a period of time and expended from it over a period of time ; that he 
also undertook to raise funds in 1970 for support of candidates in 



7157 

the 1970 congressional and senatorial elections, and that funds were 
left over from that endeavor also. 

And this is all a general understanding. I don't have any specifics 
on this. That all fits together. 

Now, as to where milk enters into it, specifically, I am not able to, 
in my own mind, establish a time. My feeling has been that it was in 
1970. But I have no basis for that, except that that is just what my 
feeling is. 

Mr. Weitz. Do you recall any discussions whether they were in 
1969 or 1970, of a problem as to the posture of certain dairy coopera- 
tives of having supported democratic candidates in 1968 and there- 
after trying to make overtures to the Nixon administration, become 
supporters of the administration one way or another. 

Mr. Haldeman. No. 

Mr. Weftz. When you say you don't remember whether it was Kalm- 
bach that you learned of the interest of the dairy people to make 
contributions from, was it probably Kalmbach, or do you have any 
other person that you think it is more than likely you received such 
information from ? 

Mr. Haldeman. No, I can't suggest any other more likely source. 

Mr. Weitz. Did you ever advise or instruct Mr. Kalmbach in seek- 
ing contributions to seek cash whenever possible ? 

Mr. Haldeman. I don't know that I advised him to. It was my 
understanding that this fund that was left over in 1968, was essentially 
a cash fund, and that what I have talked about in terms of that fund 
was a cash fund, in other words, it was money that was in the form 
of cash at the time it was donated, and it was held in the form of cash 
in bank deposits or something, or bank boxes. 

Mr. Weitz. Do you recall speaking to Harry Dent about the dairy 
people either in 1969 or 1970 ? 

Mr. Haldeman. No. 

Mr. Weitz. What about Jack Gleason ? 

Mr. Haldeman. No. There again I am not sure. I don't fix sources 
to times very specifically. If the dairy people were involved in the 
funding of the 1970 congressional support thing, I would have talked 
with Gleason, or could have talked with Gleason about that, because 
he was handling it. 

Mr. Weitz. Right. But other than that ? 

Mr. Haldeman. No. 

Mr. Weitz. Do you relate, by the way, any of your conversations 
with Gleason to the dairy people specifically ? 

Mr. Haldeman. No. 

Mr. Weitz. Was Mr. Kalmbach reporting from 1969 forward to you 
as to his activities in connection with the trust account for surplus 
1968 funds? 

Mr. Strickler. By reporting, do you mean by way of a change of 
command ? 

Mr. Weitz. Either directly or indirectly. 

Mr. Haldeman. It was providing information. I think Mr. Strick- 
ler's point was that reporting was in the sense that he was operating 
under mv direction or authority or something. I did not consider that 
he was. He was in some cases getting guidance and receiving requests 
from me for the use of funds. And wo did talk some during that 



7158 

period, at which time he would tell me in general what his fund status 
was, a report in that sense, provide information. Frequently, and 
more often than not, his communication with me was via Gordon 
Strachan, or Larry Higby in my office, rather than direct. They saw 
him considerably more than I did . 

Mr. Weitz. That would go to the method of communications ? 

Mr. Haldeman. That is right. 

Mr. Weitz. But my question is this. Who, then, had final authority 
with respect to the disposition of those funds? Was it Mr. Kalmbach, 
or was it someone else ? 

Mr. Haldeman. My view was that it was Mr. Kalmbach, but that 
he consulted with others before making decisions as to disbursement, 
and that he, I would imagine, didn't want to be in the position of mak- 
ing a disbursement solely on his own authority, and that he probably 
would in any case have consulted with someone before he actually 
spent money. 

Mr. Weitz. If Mr. Kalmbach has testified as follows, "I simply un- 
derstood that these funds were to be expended for political purposes 
:it the direction of Mr. Haldeman," — and if in that context he is 
refeiTing to the fund in this trust account which we have been dis- 
cussing—would that be consistent with your understanding. 

Mr. PTaldeman. It wouldn't be inconsistent, becaupe that would be 
at least partly what my understanding would be. It is my under- 
standing that thev could be. and I believe were, expended at the direc- 
tion of other people as well. 

Mr. Weitz. Would you be informed of those expenditures, or those 
directions? 

Mr. Haldeman. Not necessarily, and not totally, no, I don't think. 

Mr. Weitz. Do you know what other persons gave such directions ? 

Mr. Haldeman. I understand, for example, that he made expendi- 
tures for Tony Ulacewicz' activities, which would not have been at my 
direction. And I don't know whether he told me he was doing that or 
not. If he did. it was simply that this was a project he was taking 
the financing on, and let it sro at that. I don't know whether he ex- 
pended any funds at the direction of Mr. Mitchell. 

But I would have assumed that had Mr. Mitchell or Mr. Stans 
instructed him to use funds for some particular purpose, that he 
would have done so, and would not have felt it necessary to get any 
approval in oi'der to do it. and that the pame would aT:)ply probably 
to — that would basically be tlie — possibly Mr. Ehrlichman — that 
would probably be the— John Dean, perhaps, as the President's 
counsel. 

Mr. Wet'j'z. Do you know whether any moneys that were solicited 
or received by Mr. Kalmbach from 1969 to 1972 were used either for 
the purchase of San Clemente or any other personal use of the 
President? 

Mr. Haldeman. I do not know that any were. And it is my very 
strong understanding that they were not. 

Mr. Weitz. Is it your understanding whether any of such moneys 
solicited were leceived bv Mr. Kalmbach, during that period or on 
his behalf, were used to reimburse the President for such expenditures ? 

Mr. Haldeman. The same answer. 



7159 

Mr. Weitz. You have mentioned that perhaps the earliest time 
when you became aware of interest on the part of the dairy people 
to make contributions would have been perhaps 1970. 

Mr. Haldeman. That is my impression, yes. 

Mr. Weitz. Now, in 1970, do you recall being told or becoming aware 
of pledges, particularly pledges of contributions or an amount of con- 
tributions, by the dairy industry ? 

Mr. Haldeman. Again I am not positive it was 1970. But when 
there was a question of an amount, it was my understanding — not 
that it was in the form of a pledge, but that it was a declared intention 
that they wanted to contribute $2 million. That is my recollection 
of the amount. 

Mr. Weitz. And how did you become aware of that intention ? 

Mr. Haldeman. I am not sure. 

Mr. Weitz. Do you know to whom the dairy people declared their 
intent? 

Mr. Haldeman. There are various names that have come up in this 
regard. I have the problem now of being colored by what I have read 
in the papers. And it is very hard for me to sort out now whether a 
name that comes to mind as a result of that or as a result of the recol- 
lection of the time. But the communication to me on that, I have the 
feeling, came through Gordon Strachan. And I have a feeling that the 
likelihood is that that was via Kalmbach. But other people raised 
the same interest in different ways, I mean the point that the dairy 
industry was planning to make a major contribution. 

Mr. Weitz. Now, in the Wliite House white paper on the milk fund 
and dairy contributions 

Mr. Haldeman. Which I have not read, if the record may so show 
that. 

Mr. Weitz [continuing]. There is a reference to a briefing paper 
by Mr. Colson to the President, in connection with a meeting between 
the President and two dairy industry leaders, a Mr. Nelson and a Mr. 
Parr, in September 1970. First of all, were you aware of that meeting? 

Mr. Haldeman. I am sure I was at the time, because I had the basic 
responsibility for the President's schedule. 

Mr. Weitz. Were you told, either in advance or in connection with 
the meeting, of the dairy leaders' intent to make large contributions 
to the President's reelection ? 

Mr. Haldeman. I don't know. You say two dairy leaders. My recol- 
lection is that the meeting was with a large group of dairy people. 

Mr. Weitz. I believe there were two meetings at the White House 
between the President and dairy leaders. 

In September 1970, there was a brief meeting, brief photo oppor- 
tunity, I think that it might be referred to as between the President 
and two dairy leaders. 

In March of 1971, there was a larger meeting. Do you have any re- 
collection of the first meeting between the President and two of the 
dairy leaders? 

Mr. Haldeman. As I say, I surely did at the time. I don't have any 
recollection now. 

Mr. Weitz. "Wlio would have final authority to arrange such a meet- 
ing or short meeting such as a photo opportunity between the President 
and various interested industry groups. 



7160 

Mr. Haldeman. I would have the final authority, I think I could 
say, because I had the final authority on the President's schedule. We 
allocated a segment of time each day, or as often as we could, to this 
photo opportunity kind of a thing, or we called it the open hour, 
actually — I think that that was in operation at that time — where we 
allocated a half hour to an hour every day that we could to brief ap- 
pointments, opportunity for people to come in and shake hands with 
the President, and for Congressmen to bring people in that they 
wanted, for whatever reason, to present something to the President, 
or something like that. 

And many of those were photo opportunities. Technically a photo 
opportunity is when you let the press in to take a picture. And most 
of these were not that. Most of them were just White House photog- 
raphers. The lists for those were made up, and that was handled on a 
fairly routine basis by Dwight Chapin, who was the operative appoint- 
ments secretary and handled the actual implementation of the Presi- 
dent's schedule. 

And so I did not necessarily review each individual appointment, 
especially in that category, because the President sort of left that time 
open. And Chuck Colson and others who were dealing with people on 
the outside, the congressional relations group, and so on, were free to 
recommend meetings. 

Mr. Weitz. Did there come a time in the fall of 1970, possibly 
November of 1970, in which you conferred with Mr. Kalmbach about 
his becoming active in soliciting contributions for the 1972 campaign ? 

Mr. Haldeman. I am sure — I don't know when it was, but I am 
sure there was, because there was a plan agreed upon that Kalmbach 
would undertake to raise a startup fund in effect for the 1972 campaign 
that would provide income and ability to underwrite campaign-type 
expenses that might be undertaken before the setting up of the formal 
campaign committee, and things that couldn't be properly undertaken 
by the White House, but that needed to be early. 

Mr. Weitz. Do you recall discussing with him, in specific or general 
terms, particular contributions or possible contributions from large 
groups, as part, of that startup campaign ? 

Mr. Haldeman. The plan of what he was going to do was, as I 
recall it, a plan limited to large contributors. It was to work in the field 
of very major contributions on the basis that that would be early 
money. It was not a broad-based fundraising program. 

Mr. Weitz. I understand. Do you remember discussing with him 
contributions or soliciting contributions from the dairy industry or 
dairy groups? 

Mr. Haldeman. I don't remember the dairy groups specifically. But 
I would not be surprised that that would be included. And I know 
there were discussions at some point, because I have been questioned 
on this subject somewhere with some memorandums that raise the 
question of the handling of dairy contributions. 

Mr. Weitz. We wnll get to that shortly. 

Your logs show that on November 19 and November 20, you met 
with Mr. Kalmbach on successive days. And according to Mr. Kalm- 
bach 's testimony, it was in November of 1970 that you discussed with 
him the possibility of raising funds for the 1972 campaign. And those 
two dates I mentioned were the only times you met with him? 



7161 

Mr. Haldeman. Was Mr. Mitchell in either of those meetings ? 

Mr. Weitz. Is it your recollection that Mr. Mitchell was present 
at one of those meetings ? 

Mr. Haldeman. I have the general feeling that he was. 

Mr. Weitz. The log indicates that on November 17, which would be 
close to that time, you met with the Attorney General, but not with 
Mr. Kalmbach. It rnay have been a later time. Do you associate it with 
the other discussions with Mr. Kalmbach about him soliciting funds? 
This is just a summary. 

Mr. Haldeman. It may or may not have been the same face to face 
meeting. 

Mr. Weitz. Is it your recollection that at that meeting you probably 
did discuss the dairy contributions or the dairy group as one of the 
possible contributors ? 

Mr. Haldeman. I can't give you a recollection. I don't know whether 
it was or not. 

Mr. Weitz. Is it your recollection that by that time, you were aware 
of this declared intent on the part of the dairy industry? 

Mr. Haldeman. I think so. It is my impression that I was aware of — 
I have the impression that the dairy industry contributed to the 1970 
effort, and I was aware that they had done that and were going to con- 
tinue with this other support in 1972. 

Mr. Weitz. Did you instruct Mr. Kalmbach to contact the dairy 
people, or in the alternative, did you instruct representatives of the 
dairy industry to contact Mr. Kalmbach to meet with them and arrange 
for such contributions ? 

When I say "you," I mean either directly or indirectly. 

Mr. Haldeman. That is why I raised the question as to Mr. Mitchell. 
There was a question as to how the dairy people had indicated whether 
it was to Mr. Kalmbach or someone else. But the information came in 
that they wanted to make these maior contributions, that they wanted 
committees set up so that they could make them to a number of com- 
mittees. And this was the question of who would set those committees 
up and carry out the administrative procedures and handle the receipt 
of the funds and the disbursement of them, and that sort of thing; it 
was going to be a complex effort. And it was obviously a first effort 
or a step in the establishment of this early 1972 money. 

So at some point there was discussion, and I am sure with Herb, as 
to the process of setting this up, and whether he should be the contact 
to handle the milk thing or not. 

Mr. Weitz. Were you aware that Mr. Evans, Tom Evans of New 
York, was also involved in that undertaking? 

Mr. Haldeman. Yes ; generally so, in the sense of Mr. Kalmbach, T 
believe, using Mr. Evans as legal counsel for setting up the papers and 
the mechanics of these numerous committees. 

Mr. Weitz. Do you know Pat Hillings ? 

Mr. Haldeman. Yes ; I do. 

Mr. Weitz. Have you ever seen the letter termed "The Pat Hillings 
letter of December 16 to the President" ? 

Mr. Haldeman. Yes ; I have seen that in the paper. 

Mr. Weitz. Besides what you have read in the paper, do you recall 
ever having seen or received the letter, or a copy of the letter? 

Mr. Haldeman. I don't. 

Mr. Weitz. We have a memorandum dated December 17, 1970, the 
day following the letter, from Roger Johnson to you. And the subject 



7162 

matter is "Letter to the President, from Pat Hillings" — which indi- 
cates he sent a copy of the letter to you. Does that refresh your recol- 
lection as to whether or not you have seen the letter ? 

Mr. Haldeman. No ; it doesn't. I had forgotten all about Roger John- 
son. But he was working in this area of dealing with friends of the 
President and people such as Pat Hillings on the outside. And so this 
would be a natural routine. And I don't recall that or this letter. 

Mr. Weitz. Now, in the Johnson memo, it says that "Pat Hillings 
handed me the attached letter and asked that it be directed to the 
President." 

Was the letter, in fact, directed to the President ? 

Mr. Haldeman. I don't know. I can't answer, because I don't recall 
the letter. 

Mr. Weitz. Do you recall whether the President was briefed on the 
subject matter of the letter, which would be both dairy import quotas 
and the subject of contributions ? 

Mr. Haldeman. I don't know that. 

Mr. Weitz. We have another memorandum, which is imdated, Mr. 
John Brown to J. C, whom we have since been informed is probably 
John Campbell. And the comment, the handwritten notation is, 
"Would you check with E. and Colson on whether this should go in, 
and if so, in what form." And we have obtained an affidavit to indicate 
that this was attached to a letter from Pat Hillings, which would 
presumably be this same letter. Does that refresh your recollection 
as to whether the President was briefed as to the subject matter of 
the letter? 

Mr. Haldeman. No, it does not. But this is exactly what the pro- 
cedure should have been, which is nice to see that it went that way. 
A memo like this addressed to me, transmitting or purporting to trans- 
mit something to be directed to the President, would in our normal 
process, if it is properly carried out, have gone to the staff secretary, 
who at that time was John Brown, for what they called staffing, which 
would mean checking it out as to exactly this question, should it go 
to the President, and if so, in what form. And Brown's job was to 
decide and carry out the checking of this against the proper source, 
which in this case, it being a domestic policy matter, would be John 
Ehrlichman. 

J. C. was the domestic counsel staff secretary at that time, John 
Campbell. And this, then, would be the route that Brown would 
take to get an answer from Ehrlichman on whether this should go to 
the President. All that fits together exactly the way it should fit to- 
gether. 

Mr. Weitz. Do you remember discussing the subject matter of the 
letter, or the matter of the import quotas and dairy contributions, 
with either Mr. Colson or Mr. Ehrlichman ? 

Mr. Haldeman. I do not. 

Mr. Weitz. How about Mr. Flanigan ? 

Mr. Haldeman. No. 

Mr. Weitz. Were you involved in the decisionmaking process or 
aware of it in connection with the setting of import quotas at the 
end of 1970? 

Mr. Haldeman. No — I am sure I was, in an abstract sense, aware 
that this was a matter coming before the President. I was not in- 
volved or aware of the process by which the decision was being made. 



7163 

Mr. Weitz. You notice in the Hillings letter, in the third full para- 
graph, it refers to the $2 million that the dairy people were attempting 
to raise and arrange to contribute to the President's reelection. Would 
that be the $2 million declared intention to which you have referred ? 

Mr. Haldeman. That would mesh with what I understood. 

Mr. Weitz. The last sentence of that paragraph refers to the fact 
that "AMPI also is funding a special project." Do you know what 
that special project was that AMPI was funding ? 

Mr. Haldeman. No. 

Mr. Weitz. Did anyone ever inform you, in a general way, as to what 
that might refer to ? 

Mr. Haldeman. I don't know. On that basis, no, I have no recollec- 
tion of a special project that was being funded by them, with no more 
indication of it than that. 

Mr. Weitz. Your logs indicate that on December 14 you met with 
Mr. Connally. Do you recall ever discussing in 1970, before he became 
Treasury Secretary, or in early 1971, before he became Treasury 
Secretary, any matters in connection with the dairy co-ops or the dairy 
industry ? 

Mr. Haldeman. I recall — and I am sorry to keep doing this, but I 
have got to, in the interest of accuracy — I recall talking with or listen- 
ing to Mr. Connally on the subject of the dairy contribution. I cannot 
tell you whether it was before or after he became Treasury Secretary, 
nor can I tell you on a calendar basis when it was. I don't know. It 
obviously was before the mechanics were set up for receiving the 
money, because the point that Mr. Connally made to me was, as I re- 
call it, simply that the dairy people want to make a contribution, and 
they have been trying to work with the campaign people, or whoever 
is handling it, and they weren't getting the mechanics set up for them 
to do this. And that is kind of stupid, why doesn't somebody get it 
setup. 

Mr. Weitz. If the record shows that dairy industry committees 
were established and substantial contributions were made by the dairy, 
certain dairy trusts in the middle of 1971, presumably this conversa- 
tion with Mr. Connally would have preceded that? 

Mr. Haldeman. That would be my feeling, that it was before the 
process was underway of the money actually being donated. 

Mr. Weitz. In what connection did you discuss this with Mr. Con- 
nally ? Or did he raise the matter with you ? 

Mr. Haldeman. He simply told it to me. As I recall, it was after 
a meeting of some kind, and he and I were walking down the hall, that 
is sort of the recollection I have, walking down the hall, and I was near 
my office, and his saying in effect what I have just said. 

Mr. Weitz. When he raised it you were already aware at that time 
of the declared intention and who the dairy people were, and so forth? 

Mr. Haldeman. That is right — not who they were in terms of people. 

Mr. Weitz. As a group. 

Mr. Haldeman. I was aware that the dairy industry was interested 
in making this contribution. 

Mr. Weitz. And you associated this with this declared intention that 
you learned of sometime in 1971 ? 

Mr. Haldeman. I did. 



7164 

Mr. Weitz. Did Mr. Connally discuss the matter in connection with 
any particular problems or any particular previously agreed upon 
arrangements of the dairy industry ? 

Mr. Haldeman. No. 

Mr. Weitz. Or these dairy groups ? 

When you say "dairy industry," were you aware of the fact that 
these were dairy cooperatives as opposed to other corporations? 

Mr. Haldeman, No, I wasn't. My understanding is that it was the 
milk money, the dairy people, and that kind of thing, is the way it was 
put to me or at least the way I understood it. And I was not in my own 
mind at least conscious of any particular individuals or organizations. 

Mr. Weitz. Did Mr. Connally, by the way, seem fairly familiar with 
the attempted arrangements on the part of the dairy industry to make 
such contributions ? 

Mr. Haldeman. Not particularly. I had the impression that someone 
had spoken to him, probably, and said, "We are trying to get this 
worked out to make contributions, and the Nixon j>eople haven't worked 
it out." And Connally passed that along as information. 

Mr. Weitz. Before the dairy import quota decision was actually 
made, and at the end of 1970, do you recall meeting with Mr, Kalmbach 
and learning of the progress being made or the arrangements to be 
made for the dairy contributions. 

Mr. Haedeman. Well, I can't put one in juxtaposition to the other. 
But I have the feeling that there were some discussions with Mr, Kalm- 
bach in the process of getting this set up as to the progress reports from 
him as to his getting the means set up for receiving the contributions. 
I don't know whether that fits vis-a-vis either the calendar — I don't 
know when the quota decision was made. 

Mr. Weitz. Now, turn your attention to 1971. Do you recall when 
you first became aware of the intention of persons in the administra- 
tion to arrange a meeting, or the request that the administration ar- 
range a meeting between dairy leaders and the President? 

Mr. Haldeman, No, that doesn't stand out as a significant event, 
because at that time, and over considerable time, there were a number 
of meetings set up with industry, labor and various kinds of groups, 
religious and so on, with the President. And this meeting with such 
people was one of such. 

Mr. Weitz. Let me show you a copy of a letter indicated January 26, 
from Secretary Hardin to you. And the subject is "Meeting with the 
President and leaders of the dairy industry." 

Does that refresh your recollection as to any communications be- 
tween you or your office and Secretary Hardin in the process of arrang- 
ing such a meeting? 

Mr. Haedeman. No. And acfain, absent any other indication that 
that came to me, the odds are that it wouldn't. Normally that kind of a 
memorandum would go to Chapin or to Dave Parker, who handles 
the scheduling. 

Mr, Weitz. In the white paper in that connection it indicates that 
preparations becan in January and the meetinir was in fact arranged 
sometime in February for a meeting. But again you don't recall any 
specific arrangements for the meeting or any specific knowledge as to 
when, in fact, the meetins: was arranged ? 

Mr, Haldemax That is correct, I do not. 



7165 

Mr. Weitz. Did there come a time, however, that you did become 
aware that such a meeting was to take place ? 

Mr. Haldeman. Yes, I am sure when it ultimately was put on the 
President's calendar as a scheduled meeting. 

Mr. Weitz. If, according to the white paper, it was arranged more 
than 3 weeks ahead of time, and the meeting took place the 23d of 
March, therefore it had to be no later than late February or the very 
beginning of March, when the meeting was ultimately set on the Presi- 
dent's calendar, it was no later than that time that you would have 
become aware of the meeting ? 

Mr. Haldeman. I don't know what you are defining at that time. 

Mr. Weitz. The time it was set on the President's calendar, no later 
than late February or early March of 1971 ? 

Mr. Haldeman. I don't know when it was set on the President's 
calendar. Normally the President's calendar was set on quite a short- 
term basis. This kind of meeting was not formally set up very far 
in advance. Some of them were, and this may very well have been. But 
generally a meeting of this kind was set up on only a few days' notice, 
because we worked to keep the calendar flexible. 

Mr. Weitz. Do you recall any discussions either with Mr. Colson 
or Mr. Kalmbach, again directly or through your aides, in 1971, con- 
cerning specific arrangements by someone outside the White House 
to oversee such contributions from the dairy industry ? 

Mr. Haldeman. I am not sure I know what you mean. 

Mr. Weitz. Was Mr. Kalmbach to be primarily responsible for ar- 
ranging for the committees to receive the contributions ? 

Mr. Haldeman. That was my recollection originally. And then there 
was a question of whether or not Mr. Kalmbach would or should or 
could. He was always interested in getting out of the fundraising 
mechanical area. He was willing to take on this major project, but 
wanted to do that and then get out of fundraising. This was basically 
a routine fundraising thing, if that is what you mean. I am not sure 
I know what you mean. 

Mr. Weitz. Do you know Bob Bennett ? 

Mr. Haldeman. I do not. I know the name. 

Mr. Weitz. Do you know what function he was to play, or in fact 
played, in the arranging of the receipt of contributions from the dairy 
group in 1971 ? 

Mr. Haldeman. No ; I don't recall. 

Mr. Weitz. Let me show you — unfortunately it is no more than a 
mockup of a White House memo, since we have not obtained a copy 
of the memo from the White House. 

Mr. Sanders. It is a fabrication of a memo. 

Mr. Weitz. It is a fabrication of a memo. And it is described in the 
Kalmbach deposition. 

Mr. Haldeman. And then I wrote "Proceed away," and then I wrote 
"Bob Bennett"? 

Mr. Weitz. You wrote "Proceed away," and Mr. Kalmbach was not 
able to identify your handwriting as to whether you wrote "Bob 
Bennett." 

Does that refresh your recollection as to any arrangements being 
made or discussions in early 1971 about receipt of the contributions? 

Mr. Haldeman. No. 



7166 

Mr, Weitz. Wasn't Mr. Kalmbach actually very reluctant to stay 
involved in that for two reasons ? One, he hadn't solicited the contribu- 
tions, and second, he didn't want to deal with these people particularly 
or with any special interest groups as opposed to single contributors ? 

Mr. Haldeman. I am not sure of the second point. But certainly if 
he says that I would accept it. 

Mr. Sanders. Is that reconstructed by Kalmbach ? 

Mr. Weitz. No. 

Mr. Sanders. Does it purport to be verbatim, or is it just an esti- 
mate? 

Mr. DoRSEN. There were a number of exhibits described from the 
Kalmbach deposition, some purporting to be direct quotations, and 
some paraphrases. The direct quotes we put in direct phase, and the 
paraphrases we do not. And so we have taken whatever knowledge* we 
have and tried to reconstruct the exhibit at this time. 

Mr. Sanders. Is it constructed solely from Kalmbach's remarks in 
his deposition ? 

Mr. Weitz. Based on the document in front of him ; yes. 

Mr. Strickler. And you were showing this to Mr. Kalmbach to re- 
fresh his recollection. 

Mr. Weitz. Yes. 

Mr. Haldeman. Kalmbach had the document in front of him, didn't 
he? 

Mr. Weitz. That is right. 

Mr. Haldeman. Wliy don't you subpena the document ? 

Mr. Weitz. That is a long story. 

Mr. DoRSEN. We have, is the short story. 

Mr. Weitz. My first point was correct, in that Mr. Kalmbach did 
not consider himself as having solicited the contribution, and therefore 
was not responsible for the contribution. 

Mr. Haldeman. And, yes. And he was not anxious to get in a dif- 
ferent fundraising role, dealing with a lot of fundraising activities. 
He had set out the goal of these prime contributors that he was going 
to start out a fund for. And I believe his intention was a way of getting 
himself out of having to stay in the fundraising business through the 
campaign. 

Mr. Weitz. Who in fact did you consider having been responsible for 
soliciting the contribution ? 

Mr. Haldeman. My general view is that it was not a solicited con- 
tribution, that it was a volunteered contribution. 

Mr. Weitz. You didn't consider Mr. Colson as having solicited the 
contribution? 

Mr. Haldeman. No. I knew Mr. Colson was in contact with the milk 
group, as he was in contact with many other groups. But my recollec- 
tion now is that this was something where they were volunteering to 
provide support, not where someone had gone and asked them for it. 

IVfr. Weitz. Did you consider it unusual that a group without, I 
might say. a history of suDportin.q; Republicans, especially at the 
Presidential level, was pressin.o- and seeking out and volunteering, as 
you put it, to contribute $2 million ? 

Mr. Haldeman. Not necessarily. And I should say that it was 
clearlv stated in the discussions of this several times in my under- 
standing, that they were making it very clear that their contribution 



7167 

was in the nature of a campaign contribution and was not dependent 
upon any quid pro quo in any way. 

Mr, Weitz. Who told you that ? 

Mr. Haldeman. It was an explicitly stated sort of thing. I am not 
sure who told me. But obviously, an offer of a $2 million contribution 
is a matter of interest. And the question, if not spoken, automatically 
arises as to why. And the point was made that this was not contingent 
upon any action, nor was it as a result of any action that had been taken 
or would be taken by the administration. 

Mr. Weitz. Did you talk about this with Mr. Colson ? 

Mr. Haldeman. That is possible. 

Mr. Weitz. Did Mr. Colson assure you that he hadn't made any 
promises ? 

Mr. Haldeman. Wait a minute. I cannot confirm that I did talk 
about it with Mr. Colson. 

Mr. Weitz. Do you recall whether either Mr. Colson or Mr. EhrlicK- 
man or Mr. Whittaker assured you that no promises had been made 
for the $2 million ? 

Mr. Haldeman. I can't give you a name on it. But I can say what I 
previously said. It was clearly my understanding, from whomever the 
information was coming, that this was a matter that was not contin- 
gent upon any promises made, nor were there any asked. 

Mr. Weitz. Were you aware that at one or more meetings between 
Mr. Colson and representatives of the dairy industry, at which such 
pledges and declarations of intent had been made, beginning in 1970, 
that, contemporaneously, discussions of dairy products had been 
discussed ? 

Mr. Haldeman. No ; I don't believe so. 

Mr. Weitz. With regard to the price-support matter 

Mr. Strickler. Would you read that last answer back ? 

[The reporter read the record.] 

Mr. Weitz. With regard to the price-support question in 1971, did 
you have any involvement in any meetings or any communications or in 
any way in the decisionmaking process leading to the President's 
decision? 

Mr. Haldeman. To the milk price-support decision ? 

Mr. Weitz. Yes. 

Mr. Haldeman. I do not believe I did. That is not an area in which I 
would be involved. 

Mr. Weitz. Your logs indicate that in March of 1971, as is probably 
true for most of the period when you were in the White House, you met 
very frequently, almost daily, with Mr. Ehrlichman. And I believe 
the white paper indicates, as well as other evidence we have gathered, 
that Mr. Ehrlichman, Mr. Whittaker, and the others were in contact 
with the milk people and the President on milk procedures support. 

Did you discuss with Mr. Ehrlichman or Mr. Whittaker, or did you 
receive any communications from them either directly or indirectly, 
concerning the price-support question ? 

Mr. Haldeman. I don't recall any discussion with them or anyone 
else on the price-support question, nor communications. 

Mr. Weitz. How about communications through your aides? 

Mr, Haldeman. I do not recall any at all. 



7168 

Mr. Weitz. The white paper at page 10 indicates that in a briefing 
paper to the President, in connection with the meeting on March 23 
between the President and the dairy leaders, there was a reference 
to the fact that the dairj group had decided to spend money, and that 
the President's old friends, Mr. Chotiner and Mr. Hillings were 
involved. Did you have any knowledge of those matters? 

Mr. Haldeman. Of what matters ? 

Mr. Weitz. The fact that dairy people had decided to spend money, 
and that Mr. Chotiner and Mr. Hillings were involved ? 

Mr. Haldeman. I think I have already said I had knowledge — I 
don't know what the date of this is. 

Mr. Weitz. This would be March 22, 1971. 

Mr. Haldeman. By then I would imagine that I did have knowledge 
that the dairy people were going to contribute. 

Mr. Weitz. What about the involvement of Mr. Hillings and Mr. 
Chotiner ? 

Mr. Haldeman. I am not sure whether I knew they were involved 
or not. It is quite possible that I did, as a matter of fact. Again, if you 
are trying to put it in a position of time, there was a question at one 
point of Chotiner being on retainer, I think, by the dairy people, or 
his law firm here being retained by the dairy people. And I did know 
that. 

Mr. Weitz. When you say "connection," in what connection? 

Mr. Haldeman. Just that, the fact. 

Mr. Weitz. There was knowledge ? 

Mr. Haldeman. Yes. 

Mr. Weitz. And Mr. Chotiner left the White House, I believe the 
record indicates, on March 5, 1971, and became counsel 

Mr. Haldeman. I am not sure when he left. 

Mr. Weitz [continuing]. Became counsel to Reeves and Harrison 
on March 8, 1971. At that time Reeves and Harrison was on retainer 
to the dairy cooperatives. Is that your recollection ? 

Mr. Haldeman. That is the way that fits together. 

Mr. Weitz. Is there a question whether it would be proper for Mr. 
Chotiner to join with that firm at that time ? 

Mr. Haldeman. I don't think so. 

Mr. Weitz. Was there, in fact, a discussion or a notion that it would 
be preferable for him to join that firm and represent the dairy industry, 
or those dairy groups ? 

Mr. Haldeman. I do not know that there was one way or the other. 
I think it was just a matter of the fact that he was. And he may have 
been for that reason a source either directly or indirectly of the dairy 
people's interest in the contribution — no, that probably came before 
he went over there. So it would not have been. 

Mr. Weitz. It may have come before, but there was some indication 
that he was also involved later. On March 22, one dairy trust con- 
tributed $10,000 to several Republican committees, and on 
March 24 — — 

Mr, Haldeman. Republican or Nixon ? 

Mr. Weitz. Republican committees. And on March 24 another dairy 
trust contributed $25,000. This would be the day before the meeting 
of the President and the day of that Whittaker memo I referred to, 



7169 

the briefing paper, and the 24th, the day after the meeting with the 
President. Do you have any knowledge of those contributions? 
Mr. Haldeman. I don't think so. 

Mr. Weftz. Did you know whether Mr. Whittaker had any knowl- 
edge of them? 
Mr. Haldeman. I have no knowledge of Mr. Whittaker's knowledge. 
Mr. Weitz. With regard to Mr. Chotiner, were you aware in March 
whether there was any discussion of Mr. Chotiner taking an active role 
in representing the dairy people ? 
Mr. Haldeman. I don't know. I don't recall any discussion of that. 
Mr. Weitz. Were you aware of any problems — when I say "prob- 
lems," bad relations — between anyone in the White House, such as 
Mr. Colson, with the dairy groups ? 

Mr. Haldeman. No. I indicated earlier this general question of who 
would handle the contact with the dairy groups. And Colson was the 
normal White House man to handle contact with outside organiza- 
tions. And I don't know why the question should have arisen, because, 
as a matter of formal routine, he would have handled it. The fact that 
there was some question about — ^but that wasn't a White House contact, 

that was just a question of 

[Discussion oflf the record.] 
Mr. Weitz. Back on the record. 

We have here a copy of an exhibit to the committee's hearings. And 
it is dated May 18, 1971. And the subject matter is: Campaign Spend- 
ing, H.R.H. and Dean.* 

Mr. Haldeman. What does that mean, H.R.H. and Dean, H. R. 
Haldeman and Dean ? 

Mr. Weitz. H. R. Haldeman and Dean. In other words, I believe it 
is the notes of a meeting taken by Gordon Strachan with you and 
John Dean. 

Mr. Haldeman. I see. 

Mr. Weitz. And the subject matter is campaign spending. Now, in 

the memo the question comes up. Dean puts the question to you 

Mr. Strickler. Can you give me the page reference in the tran- 
script? 

Mr. Weitz. Page 1229, Dean asks the question — the question before 
was : "What about the milk money ?" 
Mr, Haldeman. What date is this meeting ? 

Mr. Weftz. May 18, 1971. "Our current thinking is to keep it totally 
separate and not even use the same bank." And the notation for you is 
"Agree," and so forth. Do you remember that discussion, or do you 
remember the question of what the milk money should be used for ? 
Mr. Haldeman. I don't remember this specific discussion. I remem- 
ber, as I have indicated, the question of how the milk money was to be 
handled, and that also included the question of what it was to be used 
for. And I remember that it was in cash, and it was coming in early, 
I believe, and at the starting point of a political campaign it is ob- 
viously useful money in setting up things that you are trying to get 
underway in the simplest fashion. And I don't know whether it was at 
that meeting or a subsequent meeting, or whether it was in a meeting 
at all. But my view, I believe, was that the milk money should be used 



►See Book 3, exhibit 34-26. p. 1226. 



7170 

to set up the starting-up costs of setting up the campaign organization 
which at about that time was being set up, I think, by Jeb Magruder 
and Harry Fleming, to get various campaign activities, organizational 
structure and so forth underway. And I saw this as being a logical 
source, because it was cash in hand for financing that activity. 

Mr. Weitz. Why was it to come in cash? What was your under- 
standing ? 

Mr. Haldeman. I don't know. I have never questioned why contri- 
butions are in cash or in any other form. 

Mr. Weitz. Did it raise a question in your mind as to the propriety 
of the source ? 

Mr. Haldeman. No. 

Mr. Weitz. We are talking about, I take it, close to $2 million in 
pursuit of their pledge ? 

Mr. Haldeman. I did not regard it as a pledge, it was a stated intent. 

Mr. Weitz. I'm sorry, stated intent ? 

Mr. Haldeman. Yes. We are talking about it as whatever they were 
going to provide. 

Mr. Weitz. Over what period of time did you have an imderstand- 
ing as to over what time period the contribution would be made ? 

Mr. Haldeman. I don't know that I did in the inception period. As 
the plan was put together — I have a general recollection that it was 
set up on a basis that they would provide $100,000 a month, or some- 
thing like that, over a period of 20 months to get to this $2 million. 
That may not be precise, but that general kind of a thing. It would be 
a monthly flow. And I think that information probably preceded my 
point that this would be a good funding base for the setting up of the 
committee, because it would be presumably a regular monthly income 
that they could then work out a budget against and utilize. 

Mr. Weitz. Now, in the memo 

Mr. Haldeman. All of this — I also have the very strong feeling that 
there was considerable discussion with Mr. Mitchell, whom I looked 
to as having the basic responsibility for setting up the campaign 
organization. 

Mr. Weitz. Mr. INIitchell, therefore, was aware of the arrangements 
for this? 

Mr. Haldeman. Yes. 

Mr. Weitz. Was this one of the largest contributions, both in terms 
of timing, size, and regularity, contemplated at that time ? 

Mr. Haldeman. At that time ? It probably was. 

Mr. Weitz. The spring of 1971. 

Mr. Haldeman. It probably was. I don't know. I think it was prob- 
ably — of course, it was a group contribution. I don't know that there 
were any others of that size. 

Mr. Weitz. On page 1230 of our committee paging, but part of the 
same memo, Dean said : "It is my understanding that the White 
House is to be completely hands off the milk money." "What does that 
mean ? 

Mr. Haldeman. Other than precisely what it says, I don't know. 

Mr. Weitz. Let me ask you this : Were there certain moneys that 
were being collected from whatever source that the White House was 
nothands-off of ? 



7171 

Mr. Haldeman. Well, I have testified in other regards, and you 
get into a semantic confusion to an extent on the White House and 
what is the White House. But some of the funds that Mr. Kalmbach 
administered over those intervening years between 1968 and 1973, 
were not hands-off by the White House. I requested the expenditure 
of a substantial amount of funds for polling that was done for the 
White House. And it was paid for by Mr. Kalmbach out of those 
funds. And that would be in a sense direct White House use of the 
funds. 

As I testified in the Senate hearing, I was involved in the question 
of some of those funds or a substantial amount of those funds being 
provided as campaign support to a candidate for office in Alabama. 
And that was to consider White House use of the funds. But the point 
here was that the milk money was to be set up as campaign funds 
totally separate from anything as to the White House use of funds. 

Mr. Weitz. Let me ask you. You said your understanding was that 
it was probably $100,000 for 20 months. Some of that would be the 
timing and the amount of the contribution, as you recall. Would that 
be up to the time of the election, or up to the time of the campaign? 

Mr. Haldeman. I haven't figured it out. I don't know when the 
20 months would be up. 

Mr. Weitz. Up to the time of the election you have no recollection ? 

Mr. Haldeman. That would be to carry out their pledge. I do not 
know whether that runs to after the election or before it or whatever. 
Don't hold me on those figures. It was some division like that, in some- 
thing like that time reference. Maybe it was $200,000 a month for 10 
months. 

Mr. Weitz. We have a memo, which I will get to shortly, which talks 
about a $90,000 a month commitment. Would that be consistent with 
a 20-month-or-so timetable ? 

Mr. Haldeman. Yes. 

Mr. Weitz. Whatever it would take to run up to the $2 million? 

Mr. Haldeman. Yes. And maybe some of it came in, in an original 
amount, so that there wasn't $2 million to run on it monthly. 

Mr. Weitz. Wasn't in fact the $100,000 in 1969 part of that? 

Mr. Haldeman. Maybe it was, I don't know. 

Mr. Weitz. If you are not aware of the $100,000 previously in 1969, 
were you made aware of it in connection with being made aware of the 
full arrangement for the $2 million contribution ? 

Mr. Haldeman. I don't recall any reference back. My recollection 
would be that the $2 million that was discussed — and it was a general 
discussion, I don't think anybody wrote out an I O U, and I think it 
was considered a general figure, not a specific dollar commitment — 
but I think that that — at least my recollection of what my view of it 
was that that was what they were talking about for the 1972 campaign. 
And I didn't see the other money as having been part of what I under- 
stood to be a $2 million intent for 1972. 

Mr. Weitz. In the May 18 memo we just referred to 

Mr. Haldeman. That is the Haldeman-Dean meeting? 

Mr. Weitz. Yes. The decision as reflected in the memo was that the 
milk money would go to pay the operating expenses of 1701. 

Mr. Haldeman. That is in that meeting? 



7172 

Mr. Weitz. That is in that meeting. Three days later there is a mem- 
orandum from Strachan to you — that is May 21, 1971, which I will 
show you — which indicates that it has been decided, or the recom- 
mendation is that the milk money would not be used to pay operating 
expenses. 

Mr. Haldeman. Is that this bottom paragraph ? 

Mr. Strickler. Off the record. 
[Discussion off the record.] 

Mr. Weitz. It would be to this last sentence on the recommendation. 

Mr. Haldeman. I have read this paragraph you have indicated. 

Mr. Weitz. Under "Kecommendations." 

Mr. Haedeman. So I say I agree with that and comment, "What 
are they going to use the milk money for?"' So that it would then 
indicate that tTie view I had come to a few days earlier, of using it for 
that, had been disagreed with by Kalmbach and Nunn, and so I am 
agreeing with their disagreement. 

Mr. Weitz. What was the answer to the question, what was it used 
for? 

Mr. Haij^eman. I don't know. 

Mr. Weitz, What was it to be used for ? 

Mr. Haldeman. I don't know. That isn't indicated here, I guess. 

Mr. Weitz. There are attached some handwritten notes, apparently 
from Gordon Strachan used in the preparation of the memo. Do 
you recall any involvement of Murray Chotiner at that point, or as 
time went on, to arrange for the contributions ? 

Mr. Haldeman. I am trying to figure out Avhat Lee Nunn is doing 
at that point. 

Mr. Weitz. Were you aware that he, sometime in 1971, became 
affiliated with the Citizens Committee To Re-Elect ? 

Mr. Haldeman. Yes, I knew he was in their fundraising. I didn't re- 
alize that it was set up that early. 

Mr. Weitz. I think the record indicates it was set up sometime in 
April of 1971. 

Mr. Haldeman. OK. 

[ Discussion off the record.] 

Mr. Weitz. We have a memo, dated September 11. 1971, from Gor- 
don Strachan to you. And the subject is milk money. I would like you 
to take a look at it. And then I would like to ask you a few questions 
about it. 

Mr, Haldeman. Am I allowed to discuss grand jury matters with 
you people ? 

Mr. Wei'I'z. That is on public record. 

That indicates that as of that time, there Avas $232,500 that had 
been — I don't know whether it was called banked or received. 

Mr. Haldeman Eeleased is the euphemism. He is a lawyer, and so 
he cannot talk straight English. 

Mr. Weitz. It says slightly more than half the commitment, which is 
then characterized as $90,000 a montli. Do you have any recollection 
of what is your understanding of the commitment ? 

Mr. Haldeman. Only what I have described to you earlier, I didn't 
see it as a commitment, as T told you, I saw it as an intention to con- 
tribute. 

Mr. Weitz. You hadn't dealt with these people directly? 



7173 

Mr. Haldeman. The milk j)eople ? 

Mr. Weitz. Yes. 

Mr. Haldeman. No. 

Mr. Weitz. $90,000 a month, is that consistent with your 
recollection ? 

Mr. Haldeman. It isn't inconsistent, as the example I gave you 
was hypothetical, but it was pretty close. 

Mr. Weitz. Do you know when the commitment or the timing of 
those contributions was to have begun? 

Mr. Haldeman. No; I probably knew then. I do not recall when 
it was. You can extrapolate back from that by dividing 90 into 232. 

Mr. Weitz. It says that 232 is slightly more than one-half. If that 
were $450,000, taking $90,000, that would be 5 months back, which 
would be April 1. Do you remember any timing to begin with April 1, 
1971? 

Mr. Haldeman. No. But that does not sound unlikely, based on 
the timing of the other discussions. 

Mr. Weitz. In the middle of the second paragraph it refers to 
the fact that a reporter was interviewing various people associated 
with the contributions, and that is this sentence: "Bennett has told 
Nimn that no damaging information has been released." What dam- 
aging information was there that had not been released ? 

Mr. Haldeman. I don't know. I notice there was in one of the 
earlier things some concern about the avoidance of any language or 
something — I don't know why, unless it was that the milk people 
wanted these to be nonre[X)rted contributions and did not want it 
known that they were giving this support. 

Mr. Weitz. In the third paragraph he states that 

Mr. Haldeman. I would also say, and I have got to say, in this 
context, and it applies to a lot of others, that Gordon Strachan was 
a very capable administrative type guy, but he was also a very impres- 
sionable young lawyer, and he tended to overdramatize a lot of things, 
and to lay more import on the language than they really needed. Some- 
thing like "damaging information" can be read as kind of colorful 
language that I am not sure Avas really an accurate description of 
his concern. 

Mr. Weitz. The third paragraph makes reference to an agreement, 
that Colson had established a separate agreement with the milk people 
in order to have cash available. Are you familiar with such an agree- 
ment, or have you ever received any information to shed light on 
whether or not such an agreement or arrangement existed? 

Mr. Haldeman. I^t me ask Frank something for a minute. 

[Discussion off the record.] 

Mr. Strickler, As the record may show, I have just left the room 
with Mr. Haldeman for a matter of seconds. 

Mr. Weitz. It should also indicate that you have returned. 
Mr. Strickler. And I have returned. And his concern is that he 
was asked questions in this area by the grand jury, which has the 
document in this area. And he says, "Can I disclose what happened 
before the grand jury, or base some of my testimony on knowledge 
I acquired from the grand jury ?" 
My response to him is, "Yes," if you want to ask the questions. 



7174 

Mr. Weitz. Let me repeat the last question as a starter, and that is : 
What knowledge do you have or have you learned in connection with 
possible arranfjements of provision of cash or moneys from the dairy 
people to Mr, Colson or from Mr. Colson's projects ? 

Mr. Haldeman, Simply going back to referring to this memo, I 
have learned that there is a followup memo to this, which perhaps you 
have. And in that case my answer to Mr. Strickler would be academic. 

Mr. Weitz. Is this the memo, September 16 ? 

Mr. Haldeman. Yes ; it is. 

Mr. Weitz. That has already been made public. 

Mr. Haldeman. I didn't know that. 

Mr. Strickler. Mr. Haldeman saw it this morning before the grand 
jury, I think. 

Mr. Haldeman. I did. And this is a followup to this. 

Mr. Weitz. For the record, Ave are referring to a September 16. 
1971, memo from Strachan to you, subject, milk money. 

Mr. Haldeman. You were asking me what I knew about this. And 
this is basically what I knew about it. 

Mr. Weitz. T^t me ask you this : Wasn't there a concern that others, 
other than Mr. Kalmbach or designated fundraisers, would be ap- 
proaching contributors who had already contributed through Mr. 
Kalmbach for additional moneys for whatever purpose? 

Mr. Haldeman. Yes. 

Mr. Weitz. And, therefore, wasn't there a concern that Mr. Colson 
not approach the same groups that Mr. Kalmbach and others were in 
contact with for contributions ? 

Mr. Haldeman. There was. 

Mr. Weitz. And therefore 

Mr. Haldeman. That was not limited to Mr. Colson, but Mr. Colson 
among others. 

Mr. Weitz. Now, with respect to Mr. Colson and the milk people, 
doesn't the September 16 memo reflect the fact that, yes, indeed, Mr. 
Colson and perhaps Mr. Ehrlichman had arranged for such an addi- 
tional receipt of cash from the milk people, addition to whatever they 
were contributing through Mr. Kalmbach and Mr. Nunn ? 

Mr. Haldeman. It does. 

Mr. Weitz. After receiving this memo, did you have occasion to 
speak to others, Mr. Ehrlichman or Mr. Colson or someone else about 
this? 

Mr. Haldeman. Not that I recall. 

Mr. Weitz. Wasn't that inconsistent with your attempt to pro^dde 
that such double solicitations not take place on a frequent basis unless 
absolutely necessary ? 

Mr. Haldeman. Yes. 

Mr. Weitz. Or in any event not take place? Can you explain to us 
why you in fact did not follow this up in any way ? 

Mr. Haldeman. I don't recall following it up. I can't affirm that I 
didn't. It is quite possible that I mentioned to Ehrlichman or Colson 
something about it, or told Strachan to. 

Mr. Weitz. "^^Tiat did they tell you ? 

Mr. Haldeman. I don't know ; as I said, I don't recall. 

Mr. Weitz. This September 16 ukmuo savs, "This money was com- 
mitted by Ehrlichman, but never delivered in connection with a" — and 



7175 

there is a quotation in the memo — "project we — Colson and Ehrlich- 
man— worked on together." To begin with, did you recognize the hand- 
writing after the sentence I have just read ? 

Mr. Haldeman. Yes. 

Mr. Weitz. Whose is that ? 

Mr. Haldeman. Larry Higby — I believe it to be Larry Higby's. 
There is not enough there to confirm the writing, but it also has an "L." 

Mr. Weitz. Does that indicate that Mr. Higby followed up and con- 
firmed the accuracy of this report ? 

Mr. Haldeman. Yes. What it would indicate in this case is per the 
instruction to Strachan on the earlier one, which says, "check with 
Colson 

Mr. Weitz. The September 11 ? 

Mr. Haldeman. On September 11, I initiated that which instructed 
Strachan to check with Colson, which he did, and he is reporting back 
here. 

Before this report of Strachan came in to me, Higby took it upon 
himself — seeing the statement here by Colson to Strachan that the 
money was committed by Ehrlichman, Higby took it on himself I as- 
sume here, apparently, that this would be the case, to check independ- 
ently with Ehrlichman or Ehrlichman 's office to see if this was the 
case, in other words, whether Ehrlichman's views of this coincided 
with Colson 's as reported to Strachan. And his writing would indicate 
that he did, that Ehrlichman confirmed it. 

Mr. Weitz. It was confirmed ? 

Mr. Haldeman. Yes. That would be my impression of what that says. 

Mr. Weitz. And wliat was your understanding of the project 
referred to in that memo ? 

Mr. Haldeman. I have none. 

Mr. Weitz. Do you know tlie nature of the project undertaken by 
Mr. Colson ? 

Mr. Haldeman. Excuse me. No. 

Mr. Weitz. Did you have any knowledge either at that time or 
since that time, other than what you have read in the paper, as to 
whether or not that ])roject refered to investigation into the back- 
gromid of Mr. Ellsberg ? 

Mr. Haldeman. Not other than what I liave read in the ])aper. I have 
seen the i-eport in the paper that Mr. Colson supplied the money 
to pay the expenses, or whatever it was, of that trip. However, this all 
seems to liave taken place after that. So I don't know that this is 
referring to that. 

Mr. Weitz. It is not clear in the memos wliat the arrangement was 
and when the money was provided. 

Mr. Haldeman. No; but it says on it, September 16, that was not 
expended, it says, "committed but: not used." 

Mr. Weitz. But never delivered ? 
Mr. Haldeman. Yes. 

Mr. Weitz. Are you familiar with George Webster? Did you know 
liim ? Have you heard the name ? 
Mr. Haldeman. He is the lawyer ? 
Mr. Strickler. I suppose. 

Mr. Halde]man. Is that Geoi-ge Webster the lawyer ? 
Mr. Weitz. There is a George Webster tliat is a laAvyer. 



7176 

Mr. Haldeman. I know the name. I don't know the man. 

Mr. Weitz. Do you know whether he has any connection with pro- 
viding any role having been played in providing moneys to Mr. Colson 
or Mr. Ehrlichman for this project? 

Mr. Haldeman. I have no recollection of any knowledge of Mr. 
Webster in that context at all. 

Mr. Weitz. What about Joseph Baroody. did you know him ? 

Mr. Haldeman. I know that name, also. There are a lot of Baroodys, 
and I am not sure which one Joseph is, but I know the Baroody name. 

Mr. Weitz. Do you know the public relations firm in Washington 
of Wagner and Baroody ? 

Mr. Haldeman. I know that one of the Baroodys is in a public 
relations firm, and one is in a foundation and one is at the White 
House. 

Mr. Weitz. Do you know whether the Baroody that you have heard 
of in the public relations firm had anything to do with providing the 
moneys for the Ellsberg break-in ? 

Mr. Haldeman. I have no knowledge of sources of money on that 
at all, other than what I have seen publicly, and I do not believe I have 
seen that. 

Mr. Weitz. In the September 11 memo at the bottom, as written in, 
we see "Cashen-Mulcahy 3" and below that, "5-G separately on E 
committed siphoned." Can you identify that handwriting for me? 

Mr. Haldeman. I believe that to be Gordon Strachan's writing, I 
am quite sure it is. 

Mr. Weitz. Both lines ? 

Mr. Haldeman. Yes. 

Mr. Weitz. Do you have any knowledge of what the meaning 
of those two lines is ? 

Mr. Haldeman. Yes; if you will give me the other memo. I think 
that this memo comes back to him with my instructions saying to do 
this, and that these notes are his notes as he carries out those instruc- 
tions. Because his memo of September 16, I think, is a statement of 
what these cryptic memorandums are regarding. In other words, 
Cashen-Mulcahy -3, I think there is probably a .6 stricken out, be- 
cause this memo says, "Cashen request for $3,600, Ireland," and Ire- 
land could be ISIulcahy, and "5-G separately on E committed 
siphoned," that is sort of shorthand to what he says in the first 
paragraph. 

Mv. Weitz. What does the "E" refer to ? 

Mr. Haldeman. Elirlichman. 

Mr. Weitz. Not Ellsberg ? 

Mr. Haldeman. "E" is Elirlicliman in our office shorthand. I didn't 
have occasion to haA-e a shorthand term for Ellsberg. 

Mr. Strickler. Could I ask you — could I obtain copies of those? 
They are excerpts from the public record. 

Mr. DoRSEN. Yes. We will give you clean copies as they appear in 
the public record. 

Mr. Haldeman. What do you have to wipe out ? 

Mr. DoRSEN. Our own notations. 

Mr. Weitz. Are you familiar witli tlie term "house account" in con- 
nection with the contributions? 

Mr. Haldeman. I don't think so, no. 



7177 

Mr. Weitz. We noted in the September 11 memo — the figures used 
at that point, in the September 11 memo, of $232,500 from the milk 
people — and I have here page 121 of the Rose Mary Woods list, so- 
called, the list of pre-April 7 contributions 

Mr. Haldeman. Rosemary's babies? 

Mr. Weitz. Perhaps. And on page 121 appears the title "House 
account," the total $232,500. And another title, "Milk Producers As- 
sociation," with the three individual dairy trusts. 

Let me show it to you, although it may not be very edifying. Can 
you tell us what that refers to ? 

Mr. Haldeman. No. 

Mr. Weitz. Or why the designation "House account" ? 

Mr. Haldeman. Do you have any other page of this ? 

Mr. Weitz. That is apparently the only page with "House ac- 
count." The other pages are State by State lists of contributors. 

jMr. Haldeman. No, I do not know. 

ISIr. Weitz. Was that a reference to moneys that had been soli- 
cited, not by the State or not by regular fundraisers, but by soineone 
in the White House ? 

Mr. Haldeman. I don't think so, but I don't know. The source 
on that would be Kalmbach or Stans, I would think. 

Mr. AVeitz. Here we are reduced again — there was a series of 
memos in September 1971, to mockups, and there are two memos — 
three memos with quotations that I think are significant, or at least 
I think are worth showing to you for that purpose. 

Tlie first is September 24, 1971, from Colson to you, subject, "milk 
producers." And the entire portion we have here is in quotations. 
And I would like to read that and tell me whether you have any in- 
formation or recollection of the matter discussed therein? 

Mr. Haldeman. No. 

Mr. Weitz. Now, the memo refers to an antitrust investigation by 
the Antitrust Division of the Justice Department of the milk pro- 
ducers. The last sentence goes as follows : "If this goes too far, there 
will be a number of very serious adverse consequences which I would 
be glad to elaborate on in detail." 

Did you talk to Mr. Colson about that ? 

Mr. Haldeman. Not that I recall. 

Mr. Weitz. Isn't that surprising? 

Mr. Haldeman. That I didn't talk to him ? 

Mr. Weitz. Yes. 

Mr. Haldeman. No, Colson was wanting to come up with serious 
consequences all the time that I didn't discuss with him. 

Mr. Weitz. "\'\^iat did he mean by the reference to serious conse- 
quences ? 

Mr. Haldeman. I don't know. 

Mr. Weitz. Serious adverse consequences, I should say. 

Mr. Haldeman. I don't know. 

Mr. Weitz. Did it have anything to do with contributions? 

Mr. Haldeman. I don't know. I cannot tell you. 

Mr. Weitz. And then you have no knowledge, direct or indirect, of 
the meaning that he put on this, either through one of your aides or 
directly in conversations with him ? 

Mr. Haldeman. No. 



7178 

Mr. Weitz. Now, we have another memo, September 28, 1971, from 
Strachan to you. The subject again is "milk money." And the last 
quoted portion, which is quoted in our source, ^\"'hich is the Kalmbach 
deposition, says : 

"Colson urges his own noninvolvement." And this refers to the 
antitrust investigation, and says : "John Dean is checking this report 
on a very low-key basis." 

Mr. Haldeman. Checking what report ? 

Mr. Weitz. The report of an antitrust investigation. 

Mr. Strickler. Let us have time to read these things, will you, 
counsel ? 

[Discussion off the record.] 

Mr. Weitz. Did you ever discuss this directly or indirectly with 
John Dean ? 

Mr. Haldeman. I do not recall any discussion with John Dean or 
Chuck Colson. 

Mr. Weitz. What is the significance of the AVhite House interest in 
the antitrust investigation ? 

Mr. Haldeman. I do not know. 

Mr. Weitz. On the part at least of Mr. Colson and Mr. Dean? 

Mr. Haldeman. Where is the reference to a White House interest? 

Mr. Weitz. As evidenced by Mr. Colson's memos to you and Mr. 
Dean's low-key investigation. 

Mr. Haldeman. Colson's memos Avould appear — or Colson's memo — 
and then this comment of a Colson memorandum to apparently some- 
one else, saying he urges his own noninvolvement, Avould seemingly be, 
I guess, that he has been in contact with the milk producers, and. 
therefore, does not feel that he should be involved in any question that 
is being raised, if there is one. I am simply interpreting out of specula- 
tion here. 

Mr. Weitz. You don't have any recollection or knowledge, directly 
or indirectly, of the investigation of some concerns investigated by 
other tlian what appears in these memos by White House persons in 
the investigation ? 

Mr. Haldeman. I have no such recollection on the part of Colson 
or Dean, or anyone else. 

Mr. Weitz. Would Dean undertake such an investigation without 
consulting you either before oi' after ? 

Mr. Haldeman. Oh, sure. Dean did not consult me — Dean very 
rarely consulted me on matters that he was dealing with. Dean was 
"\'Miite House counsel, he functioned as counsel to all tlie adjuncts of 
the White House, and ho worked — I liave explained this in other 
testimony — he worked dii-ectlv with whatever White House division 
was using his services and did not have any reporting requirement to 
me on substance at all. His reporting to me was in the administra- 
tive area of staff and facilities. 

Mr. Weitz. I have again a mockup of a memo of November 3, 1971. 
from Strachan to you. And it is a cover memo for an agenda or talkins 
paper with the Attornev General for the next afternoon. November 4. 
And it indicates that tlie Attoi-nev General received a copy of the 
nttached aijenda. Item 11 on the attached agenda, as paraph lased and 
described in the Kalmbach deposition, goes as follows: 



7179 

"The agenda discusses this antitrust matter with respect to the dairy 
contributions, or whatever they refer to, in this memorandum as the 
milk-money project." 

Do you remember discussions at that time, or at any time, about 
dairy contributions and the antitrust investigation? 

Mr. Haldeman. No, I don't. As I pointed out in other testimony, 
Strachan's agenda were voluminous, and my meeting with Mitchell 
very rarely, if ever, followed the agenda or covered anything ap- 
proaching all of the items on the agenda. 

Mr. Weitz. If they were not covered in a particular meeting, if 
you did not reach the item in a particular agenda, how would they be 
handled? 

Mr. Haldeman. In no routine fashion. Some would be ignored and 
some brought up again by Strachan in an agenda another time. 

Mr. Weitz. How was this matter handled ? 

Mr. Haldemax. I do not remember the matter. So I don't have any 
recollection of it coming up, let alone how it was handled. 

Mr. Weitz. Are you aware that in the fall of 1971 the Antitrust 
Division of the Justice Department recommended to the Attorney 
General that a grand jury be impaneled for the purpose of investigat- 
ing for possible criminal indictments the dairy cooperatives? 

Mr. Haldeman. I guess I am generally aware of that from the press 
accounts. But I have no personal recollection of any knowledge of 
that at the time or any involvement in it. 

Mr. Weitz. What about an investigation in general ? 

]Mr. Haldeman. The same. 

Mr. Weitz. Other than what appears in these memoi'andums, if these 
are correct mockups. 

Mr. Haldeman. The same. 

Mr. Weitz. Are you aware that on November 30, the Attorney Gen- 
eral rejected the request by the Antitrust Division and suggested that 
they only proceed civilly ? 

Mr. Haldeman. No. 

Mr. Weitz. And you never discussed, or to your knowledge, no one 
on your behalf discussed the matter with the Antitrust Division or with 
the Attorney General ? 

Mr. Haldeman. I have no recollection of having discussed it with 
the Attorney General. I do not believe I ever had any discussions with 
the Antitrust Division, nor have I instructed anyone on my staff. I 
cannot speak for Avhat someone may have done without me, but I do 
not have any recollection at all of anybody doing it with my knowledge. 

Mr. Weitz. Did you ever discuss antitrust matters with the Attorney 
General ? 

Mr. Haldeman. Antitinist matters ? 

Mr. Weitz. Yes. 

Mr. Haldeman. None that I can recall. I did not have substantive 
discussions with him. My dealings with the Attorney General were 
on — I did in areas other than Justice Department matters. He was 
an advisei- to the President in other areas, and I did commvmicate 
with him on some of those. On substantive matters, relating to the 
Justice Department, the communication was through other routes in 
the White House and then tlirousfh me. 



7180 

Mr. Weitz. Did you discuss the antitrust investigation with Murray 
Chotiner at the time ? 

Mr, Haldemax. I don't believe so. I have no recollection of discussino- 
any case like that with Murray Chotiner. 

Mr. Weitz. According to your phone records, on November 3, and 
again on November 29, 1971, you talked by telephone to Mr. Chotiner. 
Do you recall what the substance or purpose of those conversations 
w^as ? 

Mr. Haldeman. No. Do you have those ? 

Mr. Weitz. Just the notations. 

Mr. Halde^tan. If I can see those phone records, I can tell you 
whether — those have been grossly misinterpreted. Those may have 
been calls that I did not talk on. I don't know that they were. 

Mr. Weitz. In 1972, Mr. Kalmbach had a series of meetings with the 
dairy people in connection with the subject of additional contributions. 
We have a series of memos — perhaps I can speed things up just 1)} 
showing them together. A memo of January 18, 1972, from Strachan to 
you, a political matter memo, and again another one on February 1. 
and again another on February 16. 

Mr. Haldeman. This is Kalmbach back into the milk money thing, 
Avhich Avould indicate he had been out of it. 

Mr. Weitz. In the January 18 memo there is a reference that starts 
out, "Herb Kalmbach met with Messrs. Jacobsen and Nelson." Do you 
know wdio they were ? 

Mr. Haldeman. I don't know wliether I do or not. I don't think so. 
Are they identified as milk producers ? 

Mr. Weitz. No. It is concerning milk money, but I was just curious 
as to whether you had heard those names before that time or had dis- 
cussed them with anyone. 

Mr. Haldeman. They are not meaningful — the Jacobsen name is 
meaningful to me now, because I have learned recently that he is the 
same Jacobsen who worked with Mr. Connally in the campaign. 

Mr. Weitz. Presumably, if you didn't know who they were, Mr. 
Strachan would have identified them. 

Mr. Haldeman. Not necessarily. He may have referred to them in 
earlier memorandums, and if it is identified as milk in some way 

Mr. Weitz. The reference to milk money. 

Mr. Haldeman. What that is — it is a summary of his notes of a meet- 
ing with or a communication with Kalmbach that he is transmitting 
to me. 

Mr. Weitz. It indicates that Kalmbach informed Colson at the meet- 
ing, but would not tell Colson who asked him to see Jacobsen. Do you 
know who asked Kalmbach to see Jacobsen? Was it anyone in the 
White House? 

Mr. Haldeman. I don't know. 

Mr. Weitz. And the recommendation by T>Ir. Strachan in the memo 
of January 18, is that Kalmbach be asked not to discuss the milk situ- 
ation with Colson in the future. Why was tliat ? 

Mr. Haldeiman. I don't know, unless it relates to Colson 's thing of 
his beins: kept out of it, or whatever. 

Mr. Weitz. For what purpose ? 

Mr. Haldeman. I don't know. 



7181 

Mr. Weitz. Wasn't Mr. Colson concerned that if he was — if the 
publicity revealed his connection to the milk contributions, his other 
activities might be publicized as well ? 

Mr. Haldemax. I don't really know Avhat Mr. Colson's concern was, 
or that I ever did know. 

JNIr. Weitz. Wasn't that your concern ? 

Mr. Haldeman. I don't know. 

Mr. Weitz. You don't know what your concern was? 

Mr. Haldeman. I don't know that I had any concern. 

Mr. Weitz. Were you aware of anyone else's concern in the White 
House about publicity with regard to Mr. Colson's activities, what- 
ev^er they may be ? 

Mr. Haldeman. Colson was engaged in activities that were of such 
a nature that he did not want to publicize them, and working with 
Democrat groups and that kind of thing. 

Mr. Weitz. Did you concur in this recommendation by Mr. Strachan ? 

Mr. Haldemax. I don't know. Did I ? 

Mr. Weitz. I am asking you. It says "approved." Does that indi- 
cate 

Mr. Haldeman. His recommendation that I tell Colson of the milk 
situation and that Kalmbach not discuss it with him in the future. So 
that is acceding to a request there, I guess. 

Mr. Weitz. Now, the February 1 memo which you have looked at — 
this is a week after the Nader suit had been filed, and Kalmbach 
refers to a cut in the original $2 million commitment back to $1 
million. Does that refresh your recollection that there was in fact a 
commitment? 

Mr. Haldeman. That is Strachan's terminology still. 

Mr. Weitz. That is the second memo that we have found with that 
wording. You never discussed that with him or admonished him 
not to use that terminology ? 

Mr. Haldeman. No ; I didn't worry much about his terminology' . 

Mr. Weitz. It also indicates that Kalmbach will accept the risks 

Mr. Haldeman. These were written as internal office memorandums, 
not as public documents. 

Mr. Weitz. It indicates that Kalmbach will accept the risk of being 
subpenaed by the court, in connection with the Nader milk suit. What 
risk can that entail ? What was your understanding? 

Mr. Haldeman. I don't know. 

Mr. Weitz. And at the end the recommendation — and that was 
Strachan's recommendation — apparently the Attorney General, ac- 
cording to Strachan, believes that Kalmbach should continue, and 
your comment was, "I will discuss with the Attorney General." What 
were the Attorney General's views ? 

Mr. Haldeman. I don't Imow. 

^Iv. AVeitz. Did you discuss it with him ? 

Mr. Haldeman. I don't remember any discussion. I don't know 
Avhether I did or not, unless there is something that follows up on 
that that indicates it. 

Mr. Weitz. What follows up is that on February 16, Strachan re- 
ports to you that Kalmbach is workino; with the milk people to in- 
crease the 2'38 currently back to $1 million by April 7. 



7182 

Mr. Haldeman. It appeared to indicate that Kalmbach was still 
working on the milk thing. That does not give any indication as to 
whether I raised it with the Attorney General or not. 

Mr. Strickler. Is that $1,001,000 from your last question? 

Mr. Weitz. Yes. 

Mr. Strickler. The $1,000 in the memo comes out $1 million when 
you read it. 

Mr. Weitz. It is not written as $1 million. I am just saving time. 

Mr. Strickler. I understand. 

Mr. Weitz. Also on February 1, 1972, there was a memo from 
Dean to Ehrlichman, subject Nader v. Butz^ which was the Nader milk 
suit referred to in the other memorandums. Do you remember receiv- 
ing a copy of this memorandum ? 

Mr. Haldeman. No. And I suspect that had I, I would not have 
looked at it. 

Mr. Weitz. We have later memos on the same matter that go both 
to you and Mr. Ehrlichman. That is why I am curious as to why you 
may have received a separate copy. 

Mr. Haldeman. I do not recall it. And that is the kind of thing I 
didn't usually read. 

Mr. Weitz. I would not question you about most of the contents, 
which really just reviews the factual background of the suit. 

On page 3, 1 believe, at the bottom — I will take a quick look and show 
you what I want to refer to — on page 3, at the bottom paragraph, it 
indicates that the discovery proceeding could prove disastrous. Do 
you know what Mr. Dean meant by that ? Did you ever discuss the dis- 
covery proceeding in the Nader suit ? 

Mr. Haldeman. No. 

Mr. Weitz. And then on page 4 of the same memorandum there is 
a sentence that reads, "Although these individuals" and that refers to 
officers of Eepublican committees that receive the contributions — 
"would quite truthfully be unable to have knowledge of any pressure 
brought to bear on Secretary Hardin because of those contributions, 
questioning about their duties with the committees and the manner in 
which the committees operate could prove highly embarrassing in an 
election year." Do you know what pressures were brought to bear on 
Secretary Hardin in connection with those contributions ? 

Mr. Haldeman, No; I don't think that says that anywhere, does it? 

Mr. Strickler. Are the instructions referred to ? 

Mr. Weitz. They refer, if I may characterize it, to the multiple 
setup in 1971, to receive dairy contributions. 

Mr. Strickler. Was this for all elected officers or somebody? 

Mr. Weitz. I believe those would be the Committees For the Re- 
Election of the President. 

Mr. Strickler. Thank you. It is too long for me to read, and I am 
not goinff to do it now. 

Mr. Weitz. Finally, we have a memo dated August 31, 1972, and 
this is from Dean to you and Mr. Ehrlichman, again on the subject 
Nader v. Butz. 

And the last sentence on paq-e 2 reads: 

"As is readily apparent" — this is discussing the possibility of the 
depositions of Chotiner, Whittaker, and so forth — "the potential for 



7183 

political embarrassment during the remaining months of the cam- 
paign is high." 

That is at the bottom of page 2. I show you the memo. 

What was your understanding of what embarrassment might result 
from such depositions ? 

Mr. Haldeman. No. 

Mr. Weitz. The record indicates that, ultimately, $1 million was 
not contributed by the dairy trust to the reelection effort of the Presi- 
dent, nor $2 million, for that matter. Do you have any information 
and knowledge as to why those amounts were not contributed? 

Mr. Haldeman. No. 

Mr. Weitz. Did you have occasion to discuss either with Mr. Mitchell 
or with Mr. Connally in 1972, or with Mr. Kalmbach — let me add, 
in 1972, either the timing of additional contributions or a possible deci- 
sion to delay additional contributions until just prior to the election, 
to the general election ? 

Mr. Haldeman. I do not recall any discussion of milk money in 1972 
at all. I wasn't really in the campaign money thing at all at that point, 
because when I was involved was when there wasn't a campaign struc- 
ture. And even then it was only on a basically information basis. 

Mr. Weitz. Did you have any understanding, whether or not you 
have participated in such discussions, that any such decisions to delay 
contributions prior to the election had been made ? 

Mr. Haldeman. I do not recall any ; no. 

Mr. Weitz. I have no further questions. 

Mr. Sanders. Would you just give me whatever recollection you 
have, if any, concerning the feeling prevailing in March 1971, with 
respect to the bills being introduced in Congress to statutorily in- 
crease milk price support? And what recollection you have, if any, 
about the congressional pressures being put on the White House to 
take administrative action to raise the support level, or any indica- 
tions coming from Capitol Hill that legislation would, in fact, be 
enacted ? 

Mr. Haldeman. I really am not — I cannot be responsive to your 
question. It covers an area of knowledge and requests an evaluation of 
opinion that I am not comp^ent to give. I was not in the mainstream 
of evaluation of policy or evaluation of congressional attitude or con- 
gressional pressure kind of thing in a way that I would be aware 
of this kind of thing. That would flow through — ^there are other peo- 
ple that you should ask that of, who would have a much better evalua- 
tion of it than I do. 

I have read of some of what has been in the paper, and I have heard 
reference to the President's statement in this regard. I could allude 
to that, but from my own knowledge and recollection I cannot really 
add anything. 

Mr. Sanders. Do any calls from Congressmen during that time in 
March 1971, to the President, stand out in your recollection? 

Mr. Haldeman. No. And it would not be likely that they would. 
A call from a Congressman to the President goes through the con- 
gressional office, and it would be dealt with and recorded and followed 
up from there rather than my office. 

Mr. Sanders. And it is not likely, then, that you would have per- 
sonally received these calls from congressional leaders pertaining to 
the milk support problem ? 



7184 

Mr. Haldeman. It is not likely, and almost not possible. I did have 
calls from congressional leaders, but they were not on substantive mat- 
ters. My dealings with them were on "things relating to the Presi- 
dent's schedule, or something of that sort, rather than legislative ac- 
tion on policy matters. 

Mr. Sanders. There have been some intimations that the March 12 
decision, which was the initial one made by the Department of Agri- 
culture to maintain the support level at the same level as the previous 
year, that that was early or precipitous. Do you have any recollection 
of the circumstances surrounding the decision, in the spring of 1969, 
when you first entered the White House ? 

Mr. Haldeman. No. 

Mr. Sanders. My information is that the decision for the market- 
ing year beginning April 1, 1969, was actually made in December of 
1968 while President Johnson was still in the White House. Do you 
have any awareness of that occurrence ? 

Mr. Haldeman. No. I am just totally ignorant on the subject one way 
or the other. 

Mr. Sanders. You have been asked a number of questions by Alan 
concerning information which might have come to you with respect 
to a commitment by the dairy producers to the Committee for the Re- 
Election of the President. There are a number of references in the 
documents that we have shown to you. 

Do you have any recollection that any of these mentioned in any of 
these letters or memorandums were passed on to the President ? 

Mr. Haldeman. No, I don't. I have a general belief, assumption that 
the President was aware — and I cannot tell you when that the milk 
indus*"ry had indicated their intention of providing campaign sup- 
port. I don't know when he was aware of that, and I don't believe 
that it was I who gave him the information. 

Mr. Sanders. And the gist of your testimony, then, is that the milk 
producers had a desire to contribute to the re-election of the President, 
and had made known the specific level of contribution, but that this 
was totally unrelated to any favorable action taken by the Govern- 
ment or to be taken by the Government. 

Mr. Haldeman. That is my specific understanding of what the basis 
of their intent to contribute was, that it was not to be considered to 
be related to any action or any desired action or any completed action 
by the Government. 

Mr. Sanders. That is all I have. 

Mr. DoRSEN. In that connection, Mr. Haldeman, you mentioned one 
occasion when you believed the subject was raised as to whether there 
might be a quid pro quo for the contributions, and I believe you said 
it was made clear to you that the dairy industry expected no quid pro 
quo. 

Mr. Haldeman. I don't think I said — ^my recollection is not that 
the question was raised of whether there was a quid pro quo, but rather 
that the positive was raised. The point was made that it was to be 
understood that there was no quid pro quo, there was no commitment 
contingency. 

Mr. DoRSEN. Did this come up once or more than once ? 

Mr. Haldeman. I think probablv more than once. I don't know 
that it was discussed more than once. That I cannot put into a conver- 



7185 

sation, I can only put it into a general feeling that that point was made. 

Mr. DoRSEN. And your recollection is that it was made on a number 
of occasions ? 

Mr, Haldeman. Not a number in terms of many, but maybe one or 
two occasions, one or a few more than one, perhaps. 

Mr. DoRSEN. I have no further questions. 

Mr. Sanders. Just one more. Do you have any recollection that any 
decisions by the Department of Agriculture affecting the dairy pro- 
ducers subsequent to April 1, and not necessarily related to milk price 
supports, but in other areas as well, such as milk marketing orders, 
that any decisions by the Department of Agriculture were unfavorable 
to the dairy producers, and that they perhaps made any complaints 
about the lack of attention. 

Mr. Haldeman. No. 

Mr. DoRSEN. We will have a recess. 

[Whereupon, at 5 p.m., the committee proceeded to the considera- 
tion of other matters.] 



30-337 O - 74 . 



TUESDAY, FEBRUARY 5, 1974 

U.S. Senate, 
Select Committee on 
Presidential Campaign Activities, 

Washington, D.C. 
The Select Committee met, pursuant to notice, at 10 a.m., in room 
109, Russell Senate Office Building. 
Present: Senator Talmadge. 

Also present: Alan S. Weitz, assistant majority counsel; Benjamin 
Plotkin, minority investigator. 
Senator Talmadge. Mr. Semer, raise your right hand, will you ? 
Do you, Milton Semer, solemnly swear that the evidence that you 
shall give the Select Committee on Presidential Campaign Activities 
of 1972 will be the truth, the whole truth, and nothing but the truth, 
so help you God? 
Mr. Semer. Yes, sir. 
Senator Talmadge. Thank you. 

Mr. Weitz. Mr. Semer, would you please give us your full address 
for the record, please? 

TESTIMONY OF MILTON B. SEMER, ACCOMPANIED BY CRAIG S. 
BAMBERGER, COUNSEL 

Mr. Semer. My name is Milton B. Semer, and I'm an attorney prac- 
ticing law in Washington, D.C. My home address is Great Falls, Va., 
and my professional address is 1700 Pennsylvania Avenue, NW. 

Mr. Weitz. And would your counsel identify himself for the record ? 

Mr. Bamberger. I am Craig S. Bamberger, an attorney practicing 
in Washington at 1700 Pennsylvania Avenue, WW. 

Mr. Weitz. Now, I'd like the record to show that Mr. Semer has 
provided us with a statement and accompanying documents, and I 
would like to mark this as exhibit 1 to your testimony, and have it 
entered into the record as an exhibit. 

[Whereupon, the documents referred to were marked as Semer 
exhibit No. 1 for identification.*] 

Mr. Weitz. Mr. Semer, first, by way of background, just briefly, 
I understand that you were at one time the general counsel to the 
Department of Housing and Urban Development. 

Mr. Semer. Yes, sir. 

Mr. Weitz. And that was for what period? 

Mr. Semer. 1961 through 1965. 

Mr. Weitz. And then, subsequent to that time, you were in a staff 
position as counsel in the White House ? 

Mr. Semer. I was counsel to the President of the United States for 
calendar year 1966, 



►See p. 7219. 

( 7187 ) 



7188 

Mr. Weitz. I see. And subsequent to that time, you entered private 
practice in Wasliington — reentered private practice ? 

JMr. Semer. Yes, sir. 

Mr. Weitz. Now, in 1968, did you form the firm of Semer and 
Jacobscn with Jake Jacobsen ? 

Mr. Semer. That was formed on January 1, 1967. 

Mr. Weitz. And that firm existed in that form, or succeeding forms, 
until 1972? 

Mr. Semer. Yes, sir, until May 31, 1972. 

Mr. Weitz. I believe, as you've indicated in your statement, in 1969 
the firm of Semer and Jacobsen were taken on, on a retainer basis, by 
tlie Milk Producers, Inc. — MPI. 

ISIr. Semer. It was then called Milk Producers, Inc., of San Antonio, 
Tex. 

Mr. Weitz. I see. All right. Prior to that time, Mr. Jacobsen had been 
representing them. Is that correct ? 

]\Ir. Semer. My understanding was that Mr. Jacobsen had been 
representing a client on Texas matters. 

Mr. Weitz. What was the retainer arrangement with the client? 

Mr. Semer. The retainer arrangement was $7,500 a quarter, plus the 
usual expenses and disbursements. 

Mr. Weitz. What was the first time that you met any members of 
the client, or representatives of the client ? 

Mr. Semer. The first time I met representatives of the client was 
on March 21, 1969. 

Mr. Weitz. And who did you meet with ? 

Mr. Semer. I met, certainly, with Dave Parr and possibly Harold 
Nelson. Harold Nelson was in town that day — I don't recall clearly 
as to wliether he was at that initial meeting. 

Mr. Weitz. Mr. Jacobsen w^as also present? 

Mr. Semer. Mr. Jacobsen, my partner, Avas at the meeting. 

INIr. Weitz. Now, you began — you've alluded to the fact that prior 
to that time, that it was your understanding that Mr. Jacobsen had 
represented the client with respect to Texas matters. What was your 
understanding of the nature of your representation to be ? 

ISIr. Semer. The representation of Milk Producers, Inc., by the 
Washington firm of Semer and Jacobsen, in contrast and as distin- 
guished from any representation that Mr. Jacobsen would have in 
Texas in his law firm Jacobsen and Long of Austin, was along these 
lines. It would be primarily, as far as I personally was concerned, 
research and presentations on the merits of their problems, which in- 
cluded price supports, tariff problems, and to some extent organiza- 
tional problems in the field of co-ops. 

In addition, the client was interested in establishing liaison with 
the new administration, which had not been established as yet; finding 
out how the White House would be organized to handle special interest 
groups such as this milk group, who would handle their problems; 
and finally, they were also interested in coordinating their lobbying 
efforts in Washington, and felt that Mr. Jacobsen and I, who had had 
some experience with politics and with associations, would be able to 
guide them on that. 

Mr. Weitz. Did they also explain to you that they were in the process 
of forming a political trust for the purpose of receiving moneys from 



7189 

dairy farmers and disbursing them in the form of political 
contributions ^ 

Mr. Semer. The client explained that f undraising among milk farm- 
ers would be a very liigh priority activity on their part, and that the 
money \vould be collected by a parallel organization called the Trust 
for Agricultural Political Education. 

Mr. AVeitz. It's commonly known as TAPE, T-A-P-E ? 

Mr. Semer. We used the acronym T-A-P-E from the start. 

Mr. A\'eitz. Was it your understanding that contributions by TAPE 
were to be reported to the Clerk of the House under the then existing 
Federal law ? 

Mr. Semer. I have no recollection about any discussion of reporting 
with them on that first occasion. I was never asked as a lawyer to render 
an opinion on their reporting requirements, but as an active fundraiser 
at that time for Senator Muskie, I was familiar with reporting require- 
ments, and did, in fact, report both when I was required to bv law, 
and also I reported, even when not reauired by law, all through 1969 
and 1970. 

Mr. Weitz, Now, in your statement, as exhibit 1 

Mr. Semer. If I haven't answered your question specifically, it's 
because I don't have a clear recollection of that item havmg come up on 
that date when I first met them. I do have a general recollection that 
I had no doubt that political contributions of this type would be 
reported. 

Mr. Weitz. All right. Now, in your statement, yon referred to having 
discussed certain otlier matters with John Mitchell in 1968, and I im- 
derstand that you had known Mr. Mitchell for several years in cqp.- 
nection with your work at HUD. Is that correct ? 

Mr. Semer. I knew Mr. Mitchell professionally, because when I was 
General Counsel of the Department of Housing and Urban Develop- 
ment, he w^as a member of an advisory committee to the General Coun- ■ 
sel, and he was on that committee by virtue of his prominent and lead- 
ing position as bond counsel in the American Bar — probably the 
leading one. 

Mr. Weitz. Now, to the best of your recollection, in this first meeting, 
did you discuss with ]Mr. Nelson and Mr. Parr, Mr. Jacobsen — did 
you discuss your acquaintance with Mr. Mitchell ? 

Mr. Semer. Yes, I did. 

Mr. Weitz. And was that discussed in connection with, perhaps, 
exploring the possibility of gaining access to, or finding a person to 
meet with, in the White House on dairy problems ? 

Mr. Semer. I don't recall specifically offering the client the oppor- 
tunity to work through \lr. Mitchell. I think in establishing my ca- 
pacity to work with the client, I don't have any doubt at all of that 
the name of Mr. Mitchell came up. But I don't recall ever suggesting 
to them that I would go see ]\Ir. Mitchell for them. 

The way the INIitchell name came up was in connection with a descrip- 
tion I gave the client of Avhat I had done for another client, and what I 
had done was this. I had called Mr. Mitchell when he was campaign 
manager at the Pierre Hotel. Mr. Mitchell referred me to Mr. Stans, 
and Mr. Stans referred me to Mr. Jack Gleason, who w^as then an 
assistant to Mr. Stans in fundraising. This was just before the 1968 
campaign. 



7190 

Mr. Weitz. Election. 

]\Ir. Semer. Just before the 1968 Presidential election. When I 
clescril)ed the situation to the client, and described what 1 would do, 
my recollection is that I said I would start with Mr. Gleason, and that's 
what, in fact, I did. 

Mr. Weitz. So, it was subsequent to that meeting, and that was 
when you contacted Mr. Gleason i 

Mr. Semer, Yes ; within days. 

Mr. Weitz. Now, contacting Mr. Gleason on their behalf, as you 
described it to them, was that in the context of arranging for a con- 
tribution in the way that you had done in 1968 % 

Mr. Semer. No, it was not. The contribution of 1968 was just prior 
to the 1968 campaign, and at no time can I recall the client suggesting 
that there Avould be a postcampaign contribution. 

Mr. Weitz. Well, without regard to the nature of the contribution, 
was it, in fact, the purpose of your contact with Gleason to seek a way 
to make a contribution in 1969 % 

]Mr. Semer. It was not. 

INIr. Weitz. Or at any time ? 

Mr. Semer. By the time the question of contributions came up, the 
ball had been passed from Gleason to Mr. Kalmbach. 

Mr. Weitz. We'll get to that in a minute. 

Mr. Semer. The principal reason I went to Mr. Gleason was that 
he was the only person in the White House portion of the administra- 
tion, or within the Executive Office of the administration that I knew. 

Mr. Weitz. Now, Mr. Gleason at that time was an assistant to Mr. 
Stans at the Commerce Department. Is that correct I 

Mr. Semer. That's correct, and he later went to the AVhite House. 

]\Ir. Weitz. Why didn't you contact Mr. Mitchell, who you also 
knew ? 

Mr. Semer. I didn't think it was appropriate to call the Attorney 
General on this matter. 

Mr. Weitz. Well, the matter, as I understand it specifically, was to 
find out who in the White House would be — it would be appropriate 
to meet with for dairy problems. Is that correct ? 

Mr. Semer. That is correct. 

]Mr. Weitz. And you didn't feel that that was an appropriate matter 
to discuss with the Attorney General ? 

Mr. Semer. I didn't think it was appropriate for me to call the At- 
torney General for that purpose, when Mr. Gleason is the one that I'd 
been working with. 

jNIr. Weitz. Now, subsequent to your meeting with the dairy' people, 
you in fact did contact Mr. Gleason. Is that correct ? 

Mr. Semer. Yes, I got in touch with Mr. Gleason on ]March 25, just 
4 days after meeting with the client. 

Mr. Weitz. And at that time, what was the nature of that discussion ? 

Mr. Semer. I described to him the nature of the business of the 
new client and told him about the client's interest in finding out how 
to deal with their problems as they may relate to the White House. 
I told them about their fundraising efforts and their plan to con- 
tribute as money was raised to congressional. State, local, and Presi- 
dential candidates, in order to try to get political influences and means 
of expanding the organization. And he expressed interest in the polit- 



7191 

ical fund, and he identified Mr. Herb Kalmbach, either at that time 
or soon thereafter, and siig^^ested that a meeting be arranged. 

Mr. Weitz. And why did he make that suggestion, or what was 
your understanding of' the purpose of being referred to Mr. Kalm- 
bach? 

Mr. Semer. Mr. Gleason referred to Mr. Kahnbach as a person 
who was not in Government, but was outside of Government, that 
might have some insights, or have some information, that he, Mr. 
Gleason, did not have. The publicity that Mr. Kalmbach was just 
beginning to get at that time, coupled with Mr. Gleason's sugges- 
tion that I get together with ]\Ir. Kalmbach, suggested in my mind 
that Mr. Kalmbach was emerging in the administration as an impor- 
tant and influential adviser to the President and the White House, 
along the lines that people such as Clark Clifford, Abe Fortas, Jim 
Eowe, and others had performed for the Democrats. 

]\Ir. Weitz. Was it for the purpose — was it your understanding 
that you were referred to Mr. Kalmbach for the purpose of pursuing 
the matter of political contributions ? 

Mr. Semer. The question of political contribution was not that 
specific or pinpointed at that time. 

Mr. Weitz. Now, subsequent to that conversation with Mr. Gleason, 
you contacted jSIr. Kalmbacli ? 

Mr. Semer. I'm not clear who made the first call, but a meeting 
was arranged for April 3. 

Mr. Weitz. Do you know where that meeting took place ? 

Mr. Semer. The meeting took place, probably, in my office, in the 
morning; or possibly across the street in the ISIadison Hotel, in the 
coffee shop. I have entries in my log for a 9 a.m meeting in my office 
on April 3, and I also have entries for meeting Mr. Kalmbach at the 
coffee shop on one occasion at 4 ; and my best recollection is that, on the 
first meeting, he came to my office, and on subsequent meetings, we met 
in the coffee shop. 

Mr. Weitz. OK. Now, what was 

Mr. Bamberger. Excuse me. 

[A brief recess was taken.] 

Mr. Semer. The entries in my log, Mr. Weitz, show the times. The 
entries do not show specifically whether the meeting was in the office 
or across the street in the hotel coffee shop. 

Mr. Weitz. But one way or the other, you, first in April and then in 
early May, had two meetings with Mr. Kalmbach in Washington. 

Mr. Semer. Right. 

Mr. Weitz. What was the substance of the first and second conver- 
sations with him — the first and second meetings ? 

Mr. Semer. I explained to INIr. Kalmbach who the client was, its 
relationship to other organizations in agriculture, and its politics. I 
identified the issues of concern to the client, such as price supports, 
tariffs, and discussed the client's potential for activity in a field 
such as housing, and also the potential for involvement in politics. 

I described to him the TAPE mechanism for collecting political 
funds, and discussed generally a wide variety of topics with him for 
the purposes of getting acquainted. 

Mr. Weitz. Did you discuss the possibility of making a political 
contribution ? 



\ 



7192 

Mr. Semer. I don't believe that I discussed with him a specific con- 
tribution at that time, although there is no doubt, however, that I 
discussed as clearly as I could the client's potential for making polit- 
ical contributions; that the way that they would operate would be 
to make contributions to candidates of both parties, at all levels of 
government. 

Mr. Weitz. And I believe you indicated before that that would 
include the President or Presidential candidates. 

Mr. Semer. I'm sure that the discussion included Presidential cam- 
paign contributions, which in my mind, of course, were 3 years olf. In 
addition, I discussed with him, I believe in some detail, the technique 
used by Presidential campaio-ners and at the White House, when the 
campaigner was an incumbent President, that the piggy -back con- 
trilnitions, particularly to Congi-essmen, either by taking credit for 
directing contributions, or by collecting money and redistributing it — 
redistributing the money to candidates. 

Mr. Weitz. Did you mention to Mr. Kalmbach your contact with 
Mr. Gleason ? 

Mr. Semer. Yes ; I did. 

Mr. Weitz. And did you mention to him your acquaintance, or any 
previous contacts, with Mr. Mitchell ? 

Mr. Semer. Yes ; I did. 

Mr. Weitz. Did you tell Mr. Kalmbach that Mr. Mitchell had re- 
f ei-i-ed you to him ? 

Mr. Semer. I don't recall saying specifically that Mr. Mitchell ever 
referred me. On the other hand, I regarded Mr. Gleason as veiy close 
to Mr. Mitchell, and that the relationship that I had with Mr. Gleason 
with i-pspect to the client who made the contribution before the election, 
that Mr. Gleavson had ready access to Mr. Mitchell. 

Mr. Weitz, Now, in the deposition of Mr. Kalmbach, in the case of 
Nader v. Butz., taken on December 13, 1973, Mr. Kalmbach was ques- 
tioned with regard to his meetings with you, and the contribution in 
1969: and he said on pa.qfes 6 and 7 that "he", meaning you, "indi- 
cated, as my memory tells me, he indicated that they were interested 
in making a contribution, and tliat he had talked to Mr. Mitchell, 
and Mr. Mitchell had suggested he call me." 

Now, is that consistent with your recollection, or does that refresh 
your recollection as to vour conversations with Mr. Kalmbach? 

Mr. Semer. I don't have any doubt at all that I discussed the con- 
tributions with Mr. Kalmbach. I do not recall discussing a specific 
contribution at this stage: and secondly, I do not recall being in 
personal touch with Mr. Mitchell, or telling Mr. Kalmbach that I 
was in personal touch with Mr. Mitchell. 

Mr. Weitz. Now. you indicated that you talked to Mr. Kalmbach 
about the potential of the client's trust fund to make contributions at 
all levels over a i:»eriod of time. What was his response to that ? Did 
he question you further about it, or ask you for any further specifics? 

Mr. Semer. Mr. Kalmbach had an interest in what the potential 
was, insofar as the dollar proportions were concerned, and he also had 
an interest in how the decisions would be made to disburse the funds. 

Mr. Weitz. ^^Hiat was your response to that? 

Mr. Semer. My response to that was that the client had told me 
that it hoped that the potential would be $1 million a year, and that 



7193 

the tecliniqiie of disbursement would be on a very broad scale to both 
parties at all levels of government. 

[A brief recess was taken.] 

Mr. Semer. Mv. Kalmbach in these early meetings struck me as a 
person who had no specific questions at all. He expressed great un- 
certainty, and a little later on some frustration, in trying himself to 
find out' how the White House would be organized to handle matters 
such as the milk producers and substantive questions. 

:Mr. Weitz. You did pursue that with him, but in your early con- 
tacts with him, he had no solution or answer for you in that regard? 

Mr. Sesier. That is correct. From the first time that I met Mr. Kalm- 
bach, which was, according to our logs 

Mr. Weitz. April — I believe it was April. 

Mr. Semer. It was early April, until early August; there was never 
an indication from Kalmbach to myself tliat gave me what I would 
regard as a satisfactory answer to the question the client had asked 
me to put to him ; and the general discussion I had with him consisted 
of generalities, rather vagiie guesses as to what might emerge as the 
White House style of operating, and also rather general expressions 
of interest in the administration and the party, being interested al- 
ways in receiving contributions. By "party," I mean the Republican 
Party. 

Mr. Weitz. Yes. In that connection, did you discuss with Mr. Kalm- 
bach the fac' that your clients had been supporters of Senator Hum- 
phrey and the Democratic Party in the 1968 election? 

Mr. Semer. I don't recall that specifically, but I did identify the 
clients as consisting principally of two leaders, one from Texas and one 
from Arkansas, who had organized the large co-op by merging, and 
who operated in what was primarily Democratic Party territory—- 
Texas and Arkansas; and were hoping to expand up the Mississippi 
Valley to the Canadian border, where the constituency would be one 
that was, in rather substantial majority, a Eepublican Party 
constituency. 

Mr. Wettz. Now, this same deposition I referred to previously, Mr. 
Kalmbach's — on page Y, he states that, again, in reference to these 
regular meetings with you, "he", meaning you, said : 

His clients had made contributions in support of Senator Humphrey in 1968, 
and indicated that his clients now wished to contribute, and that he had been 
directed to see me by Mr. Mitchell. 

Do you recall those exchanges with him ? 

Mr. Semer. I don't recall without mentioning the pattern of contri- 
butions bv the client in the 1968 campaign: my orientation to the 
client's political potential was the new Trust for Political and Agri- 
cultural Education then bein.o; orcfanized, which would be the princi- 
pal vehicle for making contri])utions, and I had no familiarity and no 
involvement with anv contributions thev made prior to that, al- 
though the client, of course, told me of their great interest and experi- 
ence in makinc: political contributions. 

]VTr. Weitz. Did you also have occasion to discuss with the client their 
feelings as to thf^ir nosition vis-a-vis the new administration, in view 
of their sunport for the opposition candidate in the previous election? 

Mr. Semer. I don't recall that being discussed specifically. 



7194 

Mr. Weitz. After these first several meetings with Mr. Kalmbach, 
did you, in fact, report back to the client and have subsequent discus- 
sions with them with respect to your contacts with Mr. Kalmbach? 

Mr. Semer. I reported back to the client on every occasion that I 
met or spoke with either Mr. Kalmbach or Mr. Gleason. 

Mr. Weitz. Did you also report these meetings to your partner, Mr. 
Jacobsen ? 

Mr. Semer. Yes, indeed. 

Mr. Weitz. Regularly ? 

Mr. Semer. Yes. 
^Mr. Weitz. Now, subsequent to these first two meetings wdth Mr. 
Kalmbach, in April and May, you had a series — am I correct, in May 
and June and early July — of telephone conversations and contracts 
with both the client and with Mr. Kalmbach in connection with the 
same matter. 

Mr. Semer. Yes. 

Mr. Weitz. Now, in any of these conversations, was there any fur- 
ther conversation with either Mr. Kalmbach or with your client as 
to a particular — as to making a contribution, not necessarily sometime 
in the future, but more immediately ? 

Mr. Semer. I have no recollection, Mr. Weitz, of discussing with 
Mr. Kalmbach, in this series of telephone conversations, the making 
of a specific contribution. We went over the same ground, I believe,; 
every time we talked, and one of the things that was of greatest in- 
terest to my client was whether I could find out from Mr. Kalmbach 
whether there was a particular person in the White House that the 
client could get in touch with. 

Mr. Weitz. Now, let me put it this way. Wasn't it in the context of 
representing a group that has supported the opponent of the adminis- 
tration in the previous year, the President in the previous election, and 
now^ meeting with an attorney for the President, and discussing the 
political potential aiid the potential for political contributions of your 
client ? Without it being exjH'essly stated, wasn't the pui-poi't of the con- 
tacts — wasn't it over time — didn't it become clear to you that the 
purpose of the contacts was, among other things, to arrange for some 
type of contribution to have the client more closely identified, or at 
least more bi-partisanly identified, with the new administration? 

Mr. Semer. My recollection is that the principal technique used 
to establish a bipartisan base for the client's representations or lobby- 
ing would be principally by contributions to Republican Congressmen, 
rather than a contribution to a Republican Presidential campaign 
that year. 

Mr. Weitz. 1969? 

Mr. Semer. 1969. There were two or three special elections that year 
that the client got into. 

Mr. Weitz. Directly? 

Mr. Semer. Directly. 

Mr. Weitz. Not through Mr. Kalmbach? 

Mr. Semer. Not at all. As a matter of fact, on one occasion, in 
response to an inquiry from Capitol TTill, T got the client in touch 
with a campaign chairman in one of the States where there was a 
special election going on; and this was without consultation with 
Mr. Kalmbach or anybody in the White House. 



7195 

Mr. Weitz. Now, I believe you told us in previous interviews and 
also it is referred to in your statement, exhibit No. 1, that on July 9, 
11)1)9, you met with Messrs. Nelson, Parr, and Jacobsen in Dallas, 
Tex.; and then the subsequent day, on July 10, you met with Mr. 
Kalmbach in California. 

Can you tell us, m leading up to those meetings, what the purposes 
were of those meetings? 

Mr. Semer. The purpose of the Dallas meeting was to get together 
with the client, when we would have some time, because we had not 
gotten together since we were first retained, for any lengthy discus- 
sion, and to make an assessment of what the situation was with respect 
to their etfort to establish a contact with the White House. 

These things come to mind witli respect to that hrst meeting in 
Dallas : First, that there did not seem to be much progress in getting 
any information from Mr. Gleason, :Mr. Kalmbach, or anybody else 
as to how the White House would be organized for these matters; 
or if not yet organized, how the White House could be approached ; 
second, on the question as to whether it would be worthwhile to meet 
with Kalmbach, I have not been able to reconstruct from my log 
exactly what the sequence of dates was that summer, but my impres- 
sion is today that the reason I went to see Mv. Kalmbach is that 
there would be no occasion for seeing him in the near future; and 
third, I went along because this was Mr. Kalmbach's preference. 

Some of the members of the client group, as I recall, suggested 
that perhaps we go out as a group, and I just reported to them Mr. 
Kalmbach's preference, stated to me earlier, that he preferred to 
work with one person and he hoped that person would be me. 

Mr. Weitz. Now you had met and talked with Mr. Kalmbach sev- 
eral times over a period of several montlis ; and I believe you indicated 
that up to the time of July, certainly there was still no indication 
from him as to how the White House 'would be organized and whom 
the dairy people would be in contact with. 

Now, he was aware of your question, and at that time you were cer- 
tainly aware of his answer. Wliat was the purpose of going out to meet 
with'him again? Not again, but meeting with him again, this time 
in California, until he had some hard information for you? 

Mr. Semer. Probably frustration, both on my part and on his; or 
rather, the client's part and his; or, at least as he expressed it, because 
having worked in the White House, it was, I believe, readily apparent 
to him, that a mere ceremonial visit would not be adequate. 

The question I was specifically putting, IMr. Weitz, ran something 
like this: For years the "V^liite ITouse had been organized, and I had 
been a participant in that type of organization just a couple of years 
earlier, to handle substantive issues that would inevitably be escalated 
from the departments: that all through the recent administration's 
matters such as agricultural j^roblems would inevitably be escalated 
from the Department of Agriculture to the ^^liite House. Certainly 
there are questions which are the direct responsibility of the President 
and would be handled by the. White House. And my experience was 
that the White House would he organized along substantive lines, that 
in the immediate office of the President, as a matter of fact, in the 
west wing, sooner or later the Nixon administration would have to 
adopt the techniques that we did in earlier years, which is to allocate 



7196 

the tough issues to members of the President's immediate staff. That 
in my judgment — this is what I made very clear to Kahnbach — it was 
just an estimate on my part, just a guess; one which, of course, turned 
out to be wrong, which was tiiat tiie Wliite House would ultimately 
have to adopt the same method of organizing itself as its predecessors 
had. 

Mr. Weitz. Now, at the meeting in Dallas with the client, on July 
9, was there any discussion that you recall of a particular contribution 
or making a contribution ? 

Mr. Semer. I have no recollection of that meeting pin-pointing a 
particular contribution. 

Mr. Weitz. Was there greater interest expressed by the client of 
perhaps indicating to Mr. Kalmbach that they would be willing to 
make a contribution, or at least the discussion of a possibility of making 
a contribution ^ 

Mr. Semer. It may have, but my recollection is that the interest 
that the client wanted to get across, or the point the client wanted to 
get across, and Mr. Kalmbach's interest in the previous months, was not 
so much a specific contribution as it was the client's potential. 

Mr. Weitz. And was there any discussion of making an initial start 
on that potential or making a good faith showing that in fact they were 
willing to make contributions to the Eepublican Party or Republican 
candidates ? 

Mr. Semer. I don't recall that being a matter of specific decision at 
that Dallas meeting. 

Mr. Weitz. Now, Mr. Parr has indicated to us in executive session 
that his recollection that there was a discussion at the meeting in 
Dallas of a $100,000 cash contribution. Do you recall any such dis- 
cussion ? 

Mr. Semer. I don't recall the discussion being that specific. It may 
have been somebody's recommendation. I don't recall that meeting 
making a decision along those lines. 

As a matter of fact, I don't recall a specific recommendation. It was 
not a meeting in which the focus was on the question of a specific 
contribution. 

Mr. Weitz. Now, up to this time you had also been in contact with 
Mr. Gleason again on a number of matters ? 

Mr. Semer. I kept in touch with INIr. Gleason constantly. 

Mr. Weitz. And did he also express interest on a number of occa- 
sions in the organization of this trust fund and its ])otential for con- 
tributions ? 

Mr. Semer. Yes, he did. 

Mr. Weitz. And you reported that back to your client? 

Mr. Semer. I kept the client informed of all conversations, as I 
recall, that I had with Mr. Gleason or Mr. Kalmbach. 

Mr. Weitz. Wasn't the natural conclusion to be drawn from these, 
if I may characterize them as "repeated expressions of interest" on the 
part of both Mr. Kalmbach and Mr. Gleason and the potential of con- 
tributions, wasn't it then — didn't it become clear to you, or is it 
your understanding, that the clients then felt that it would be wise 
to perhans mnke a contribution? And that matter — wasn't that dis- 
cussed at the Dallas meeting ? 



7197 

Mr. Semer. I don't recall specifically, and I certainly did not feel 
that that was the holdup ; that the whole thing revolved around an 
initial contribution as a price of enti'v to get into the White House. 

Mr. Weitz. Now, if IMr. Nelson and Mr. Parr have indicated to us 
in executive session that they felt the contribution which w^as in fact 
made the following month was for the purpose of gaining access to 
the administration, would that be consistent with your understand- 
ing of the events at the time ? 

Mr. Semer. Well, it wasn't my view at the time, nor has it been 
my view" since; tliat's what woulcl have been necessary to pursue their 
substantive interests in Washington. 

INIr. Weitz. Now the meeting the next day, on July 10, wuth Mr. 
Kalmbach — aside from your repeated interest to gain, to find out how 
the White House would be organized and so forth, and his expressions 
of frustration — was there any further discussion of political contri- 
butions or potential of a trust fund and so forth? 

Mr. Se]mer. So far as I can recall, the nature of the discussion with 
Mr. Kalmbach on that occasion was just repetitious of everything we 
had said before. 

Mr. Weitz. And there was no discussion of and certainly no agree- 
ment as to the making of a particular contribution at some time in 
the near future ? 

Mr. Sei^ier. The only thing that I can recall that might add to the 
information that we have discussed so far, Mr. Weitz, is that at some 
l^oint the question came up as to the technique of giving, and I gave 
him a description of how I was operating as a campaign treasurer 
and describing to him the reporting policy that I was then pursuing. 

And this was one of the things that ought to be given some thought, 
if money were ever given by TAPE to beneficiaries or donees that he 
would indicate. 

I think that Mr, Kalmbach on all occasions expressed interest in 
how the client was faring and also how the political trust was coming 
along. 

Mr. Weitz. When you talked about your experience in terms of 
campaign financing and reporting and so forth, did Mr. Kalmbach 
express an interest in one form of contribution over another? 

^Ir, Semer. I told him I Avas receiving cash as well as checks, as 
campaign treasurer for Senator ISIuskie, and that I was reporting all 
contributions to the Clerk of the House; first, because it was required 
by law for a Vice Presidential candidate, which is what Senator Mus- 
kie was in 1968; and then as a senatorial candidate in 1969 and 1970. 
I reported contributions received to the Clerk of the House even 
though it was not required by law. 

INIr. Weitz. Now^ on page 2 of your statement, as exhibit No. 1 

Mr. Semer. And Mi-. Kalmbach, as I recall, at some point and on 
more than one occasion, expressed a preference for cash. 

yiv. Weitz. It was he who expressed the preference for cash? 

Mr. Se:\ii:r. He expre.esed a prefeience for cash on more than one 
occasion, and I have a recollection of making a phone call to him, 
between the first time I saw him personally in California — which 
was on July 10 — and the second time I saw him personally in Cali- 
fornia — which was on August 2. I recall asking him over the phone 



7198 

just before going to California tlie second time whether he would take 
the contributions in checks, and he expressed a preference for cash. 

Mr. Weitz. I see. So therefore, Mr. Kalmbach's testimony on page 12 
of the Nader v Butz suit, where he was asked, ''AVhy did you want 
to receive it in cash?" — and this is in reference to the $100,000 con- 
tribution — and his answer, "That was the way — my memory tells me 
that was the way it was offered to me*"; that Avould be inconsistent 
with your recollection ? 

Mr. Semer. The only thing that I could become very specific about 
is that there was at least one phone call between those two dat^s when 
I saw liim personally where, to the best of my recollection, the prin- 
cipal purpose of the call was on the question as to whether he would 
take it in checks. 

Mr. Weitz. And he refused ? 

Mr. Semer. He expressed a preference for cash. 

Mr. Weitz. Did he say why ? 

Mr. Semer. I don t recall what his explanation was. I believe there 
were many couAcrsations, some of which were between secretaries try- 
ing to set up dates. The second time I met him was a complicated prob- 
lem of setting up dates. I do recall, though, that the question of checks 
versus cash did come up in a telephone conversation before the second 
visit. 

Mr. Weitz. Now I take it, then 

Mr. Bamberger. Wait just a minute — excuse me. 

Mr. Weitz. Fine. 

[A brief recess was taken.] 

Mr. Semer. This is probably a great deal, Mr. W^eitz, and as re- 
cently as a week ago, I called a former associate of mine who was 
working just a door away from me, and I asked him w4iat his recollec- 
tion was of anything involving tliis thing; and he offered a recollection 
of two items; First, that I didn't want to make the trip because of 
scheduling problems; and second, that I was much concerned about 
getting the money in checks. 

Mr. Weitz. This was the trip in which the contribution was 
delivered? 

Mr. Semer. That's right. 

Mr. Weitz. Who was that individual? 

Mr. Semer. The man whom I have iust been in touch with, within 
the last week, is Mr. Gavin O'Brien, G-a-v-i-n 0*B-r-i-e-n. He is now 
working for the Dade County superintendent of schools, and he was 
then an associate in the law firm. In 1969 he was an associate in the law 
firm. 

Mr. Plotkin. Your law firm ? 

Mr. Semer. Yes ; the law firm of Semer and Jacobsen. 

Mr. Weitz. Now, just to put this in proper chronological order, I 
take it as of July 10, there was no specific contribution, whether in 
cash or checks, that was being discussed ? That's your testimony ? 

Mr. Semer. Not t]iat I can i-ecall. I don't have anv doubt at all that 
the technique of political contributions was constantly being discussed 
right from the start, 

Mr. Weitz. I understand. Now, between the time of July 10, and 
the time of the delivery of money to Mr. Kalmbach on August 2, could 
you tell us when, to your best recollection, the subject of a particular 



7199 

contribution to be delivered to Mr. Kalmbach arose? Let me step 
back — I'm sorry — let me step back for one moment. 

I]i your exhibit No. 1 of your statement you say that on July 10, 
Mr. Kalmbiich told you that contributions would be appreciated by 
the administration. 

Mr. Semer. Rig:ht. 

Mr. Weitz. Now was that, to your understanding, an invitation 
to make a particular contribution or to begin making contributions.? 

Mr. Semer. This is my best recollection in respoiise to the question, 
what the nature was of the conversation with respect to contributions 
at the July 10 meeting; and I don't have any doubt that we discussed 
political contributing methods along witli other things, and that ]\Ir. 
KalmbacJi indicated an attitude that the administration would wel- 
come contributions, because Mr. Kalmbach spoke very generally from 
the very first time that I spoke to him. And it M\as never clear until the 
last minute that he would be the recipient of a contribution. 

Mr. Weitz. How did it come to pass, then, that in that 3-week pe- 
riod — how was it communicated to you — was a decision made to in 
fact make a contribution and deliver it to Mr. Kalmbach, rather than 
to designated candidates? 

Mr. Semer. I have no record or precise memory that there was a 
single point in that period at which a decision was made, or a decision 
involving me as a participant in the discussion, that such a decision 
was made to contribute a specific sum of money and contribute it to 
Mr. Kalmbach, and to contribute it in a particular form. 

I have been trying, without success, Mr. Weitz, to pinpoint the pre- 
cise time at which I kjiew that I was going to be the conduit for trans- 
mitting a political contribution in cash, I don't have such a record, nor 
do I have a memory of the specific point. 

I do know that in conversations between my client and myself, the 
question did come up as to the form in which a contribution would 
be made. I recall that there was discussion about designated commit- 
tees, probably for congressional candidates, whose names would be 
given to us by ]Mr. Kalmbach ; and I also recall that the question came 
up as to whether the contributions would be made in checks or in cash. 

Mr. Wettz. These were discussions with the client? 

Mr. Semer. With the client. And also the discussion on whether it 
would be in checks or cash was a discussion with Mr. Kalmbach. 

Mr. Wettz. Did you discuss with Mr. Kalmbach the possible des- 
ignation of committees for congressional candidates? 

Mr. Semer. From the start, I made it very clear to ]\Ir. Kalmbach 
that the client had been contributing and would continue to contrib- 
ute extensively to congressional candidates, and that this would be 
one of the metliods for the administration to keep piggy-backing con- 
gressional races, either by Mr. Kalinbach's designating the committees 
and having the contributions be made directly, or having the money 
transmitted through some individual, such as myself, on behalf of 
the administration to designated congressional campaigns. 

I believe one of the difficulties that we all had — ^that it was just 
after a Presidential campaign and no other campaign had begun to 
get going. 

My own recollection is that in campaign experiences that I had, a 
contribution as early as 1969, in the congressional campaign, would be 



7200 

welcomed by congressional candidates, particularly incumbents. And 
I made tliat point to all concerned. 

Mr. Weitz. But Mr. Kalmbach didn't indicate expressly for what 
purpose the contribution would be applied ? 

Air. Semer. The g-eneral impression I had with Mr. Kalmbach in 
1969, and as confirmed by a chance meetinc: with him in the lobby of 
the Madison Hotel in late spring or early summer of 1973, early 1973, 
was that that money was targeted at that time for the congressional 
campaigns, and this was confirmed by him in 1973. 

Mr. Weitz. We'll get to that in a minute. 

I think Mr. Kalmbach has a different account now, but for the mo- 
ment, l)ack in July of 1969, there was no discussion that you recall, 
other than your general understanding of the context of previous dis- 
cussions, as to the purpose of the contributions ? 

Mr. Semer. Other than the general purpose of all political contribu- 
tions, which is to petition Government — win friends. 

Mr. Weitz. A\nien did you first learn that the contribution was in 
fact going to l)e $100,000 ? ' 

Mr. Semer. When I picked it up in Dallas. 

Mr. Weitz. Now didn't the client ask youi- advice as to the magni- 
tude of the contribution, since you were in fact the one who was in 
contact with Mr. Kalmbach ? 

Mr. Semer. I have no recollection of the client asking me how much 
ought to be contributed. The general context in which contributions 
came up was their potential, and I was never part of the decision- 
making process in either the cor]iorate entity or in the trust for agri- 
cultural and political education, on how the funds, which were then 
being assembled, would be disbursed. 

I had no notion at the time as to what the trust for agricultural and 
political education had up to that point already assembled, by way of 
money. 

Mr. Weitz. When did you first learn, if not the amount, then that the 
form would be in cash ? 

Mr. Semer. I knew it would be in cash, or I suspected it would be in 
cash, anywav, when I conveyed to the client the conversation I had 
with Mr. Kalmbach, where he e^'])ressed a preference for cash. 

Mr. Weitz. So, in other words, the chronology" was that the client 
had indicated that they would like you to talk to Mr. Kalmbach about 
the mechanics of making a contribution at this time. You then called 
INIr. Kalmbach and he said "Fine, but I lu-efer it in cash." And then 
you talked to the client about that possibility. Is that the approximate 
way it happened ? 

Mr. Semer. I discussed with both the client and IVIr. Kalmbach the 
techniques of makin.of political contributions, and I expre^^sed a per- 
sonal preference both to the client and Mr. Kalmbach that some mecha- 
nism be worked out so that contributions could be made in checks. 

Mr. Weitz. But Mr. Kalmbach expressed a preference for rash? 

Mr. Semer. In at least one telephone conversation, iust prior to the 
Auo-ust meetinq: I had with him. he expressed a preference for cash. 

Mr. Weitz. Did ^'ou already have the cash at that point ? 

Mr. Semer. I did not. 

Mr. Weitz. But vou knew it was beinqf assembled, pursuant to his 
initial, his earlier preference, as indicated to you ? 



7201 

Mr. Semer. I did not kno^Y how much was going to be assembled or 
how it was going to be assembled. 

Mr. Weitz, Well, then, how did you know that the cash was being 
assembled ? 

Mr. Semer. I didn't know any cash was being assembled. The only 
thing tliat I tried to do was to maintain the communication between 
the client and myself and Mr. Kalmbach and myself; to make sure 
that both were informed as to what their information and understand- 
ing were. 

Again, the conversation I had with Mr. Kalmbach a few days before 
going down in August is one in which I expressed a personal preference 
for checks as being the means of transmitting political contributions. 

There is no doubt in my mind that this is what I conveyed to the 
client, and 1 called the client following the conversation with Mr. 
Kalmbach in which he expressed a preference for cash. 

Mv. Weitz. Why did you express a preference ? You were represent- 
ing the client that was making the contribution. You had the money, 
not Mr. Kalmbach. Why didn't you tell him they were prepared to 
make contributions in check when'committees were available ? Why did 
you merely express a pieference 

Mr. Semer. You said I had the money. I didn't have the money. 

INIr. Weitz. Well, the client did. 

Mr. Semer. The client had the money. 

Mr. Weitz. If you thought it was preferable and you were going 
to be associated with the transaction, why didn't you insist that it, 
in fact, be made by check in the regular manner to the designated 
committee ? 

Mr. Semer. I thought it was preferable. I didn't think that cash 
contributions, which I had been receiving as a campaign treasurer 
and reporting — I didn't think that they were illegal. As a matter 
of fact 

Mr. Weitz. No; they are not illegal if they are limited either to 
$5,000 to any one committee or candidate. 

Did you know how much was being discussed^ — whether it would 
be at least in excess of $5,000? 

Mr. Semer. I don't think there is any doubt at all that both — cer- 
tainly the client knew what the ground rules were on political con- 
tributions, and ]\Ir. Kalmbach, I believe, knew; and if he didn't, 
I'm sure he knew that I knew. 

Mr. Weitz. Did you then expect the contribution to be limited to 
$5,000? 

[A brief recess was taken.] 

Mr. Semer. I believe I indicated to Mr. Kalmbach what the ground 
rules were and the law for making political contributions and described 
to him how I was operating as a political treasurer; and that I also 
recall indicating to him the $5,000 limitation for any particular com- 
mittee, and that probably the most prudent method would be to have 
designated committees ready for the receipt of any political con- 
tributions. 

Mr. Weitz. And what was his response to that? 
Mr. Seinier. I don't recall any specific words that he used. I did 
come away with the impression that he was interested in helping in 
the 1970 congressional campaign. And of course I didn't have any 



-337 O - 74 - Bk. 16 



7202 

doubt that if people wanted to transmit money, whether it was cash 
or checks, to congressional campaigns, that it would be very easy to 
find committees to do it. 

Mr. Weitz. And then, as you say, if TAPE had been making 
contributions all along and had intended to do so, then such com- 
mittees were in existence then, weren't they? 

Mr. Semer. Well, I'm sure there were committees in existence all 
over the country. 

Mr. Weitz. That's right. 

Mr. Semer. The question was which of these committees Mr. Kalm- 
bach, as representative of the administration, would want to designate 
as the favorite committees for receipt of money from the milk 
producers. 

Mr. Weitz. And until such time as Mr. Kalmbach had made that 
decision or someone in the administration had made that decision, 
was there any need for the money? 

Mr. Semer. I don't know. 

Mr. Weitz. Other than to collect interest somewhere? 

Mr. Semer. I have no idea what the motivations of people were in 
trying to give money at a particular time. All I know is that money 
was discussed all along the way. As far as my personal involvement 
is concerned, I did go out and speak to Mr. Kalmbach in July, 
without any money ; and I did go out to him in August with money. 
And after that, I have no information whatsoever as to what hap- 
pened specifically with respect to the money along the lines that you 
are asking. 

I can only speculate that once the contributions were made to Mr. 
Kalmbach or his designated committees or people, that there would 
be a pattern established because as I recall, my attitude at the time 
was that it was highly desirable to establish a pattern of contributions 
from organizations that had a lot of money to give. 

I don't know how much money was in TAPE at the time, but I 
do recall getting across the point that the client had told me that it 
hoped for $1 million a year potential in fundraising and fund giving. 

Mr. Weitz. Now in late July, did there come a time when you made 
arrangements either directly or indirectly with Bob Lilly of the 
client to receive the money in order to take it out to Mr. Kalmbach? 

Mr. Semer. I was told — I don't recall by whom, possiblj' by my 
partner, Mr. Jacobsen— to go down to Dallas, and I believe he* said 
it would be Mr. Lilly, l>ut I don't recall specifically— that it would be 
Mr. Lilly that I would meet at the same place where the group had 
Jiict a month before. 

Mr. Weitz. For the expressed purpose of the receiving of the money 
delivered to Mr. Kalml)ach ? 

Mr. Semer. Yes. 

Mr. Weitz. And at that time did you know what was to be delivered 
to you ? 

Mr. Se^mek. T knew when I\f r. T>illy told me. 

Ml-. Weitz. Did you know in advance of when IVfr. Lilly told you, 
and T take it that was in Dallas at the time of the delivery? Did you 
know that the amount would be substantial? Bv that I mean in excess 
of i^n.OOO or $10,000? 



7203 

Mr. Semer. I don't have a recollection of focusing on an amount 
before. I do know that I was surprised when Mr. Lilly told me how 
much it was. 

Mr. Weitz. Did you understand that it would be at least a sub- 
stantial contribution ? 

Mr. Semer. Well, by Muskie election committee standards, any- 
thing up to $5,000 was substantial. 

Mr. Weitz. Then anything in excess of that was certainly substantial. 

Mr. Semer. Yes. Anything $1,000 or more to the Muskie campaign 
was regarded as substantial. As a matter of fact, anything $100 or more 
was substantial. 

Mr. Weitz. On August 1, you met Mr. Lilly at the Executive Inn 
in Dallas ; is that correct ? 

Mr. Semer. Yes. 

Mr. Weitz. And Avas that the first time you met Mr. Lilly ? 

Mr. Semer. I believe I had met Mr. Lilly before, on occasions when 
he had accompanied Mr. Nelson or Mr. Parr or both in Washington. 

Mr. Weitz. And did he deliver the money to you ? 

Mr. Semer. Yes, he did. 

Mr. Weitz. And did he tell you then how much money he was deliver- 
ing to you ? 

Mr. Semer. Yes, he did. 

Mr. AVeitz. The $100,000 was in cash ? 

Mr. Semer. Yes. 

Mr. Weitz. It was in $100 bills ? 

Mr. Semer. I don't recall what denominations they were in propor- 
tionately, but they were not all in one denomination, such as $100 
bills. 

Mr. Weitz. Do you remember whether the bills were of the same 
uniform condition or age, or whether they were of varied conditions 
and ages ? 

Mr. Semer. They were not all new. That's about all I can recall. 

Mr. Weitz. Some were new and some were not ? 

Mr. Semer. Some may have been. I never got a good look at them 
until Mr. Kalmbach took them out of the container and put them on 
his desk in his office for counting. 

Mr. Weitz. That leads me to my next question. When Mr. Lilly 
delivered the money to you, did you count or in some way verify the 
amount of the cash ? 

Mr. Semer. I did not. 

Mr. Weitz. Did Mr. Lilly ask you to ? 

Mr. Semer. No, he didn't. 

Mr. Weitz. Did he explain what his understanding of the contribu- 
tion was, or indicate any knowledge of who you were to deliver the 
money too, and for wliat purpose ? 

Mr. Semer. To the best of my recollection, Mr. Lilly gave me the 
money and very quickly left. He did not indicate to me as I recall, 
any of the policy considerations that lay in back of the contribution 
or anything more specific than the fact that he knew that I was going 
to take this to Mr. Kalmbach the next morning. 

Mr. Weitz. What was your understanding of the source of the 
money ? 

Mr. Semer. TAPE. 



7204 

Mr. "Weitz. Now the next morning you flew to Los Angeles and met 
with Mr. Kahnbach ? 

Mr. Sp:mer. Yes. 

Mr. Weitz. At his office in Newport Ik^ach ? 

Mr. Semer. Yes. 

Mr. Weitz. And you delivered to him the satchel containing the 
money ? 

Mr. Semer. It M-as tlie flight bag. 

Mr. Weitz. The flight bag. Could you tell me the substance of the 
conversation with him with respect to the contribution, other than the 
pleasantries that you may have exchanged with Jiim I 

Mr. Semer. I told him that I had $100,000 in cash from TAPE, and 
I think quite a lot of the time was spent in counting it. 

Mr. Weitz. Did lie seem surprised at the amount ? 

Mr. Semer. I don't recall wluit his immediate reaction was. 

Mr. Weitz. You do recall telling him that it was from TAPE ? 

]Mr. Semer. Yes. 

Mr. Weitz. He counted the money ? 

^Ir. Semer. Yes, he did. 

Mr. Weitz. And then he placed it in his office safe I 

Mr. Semer. I don't recall wdiat he did when he counted it. 

Mr. Weitz. Did you have any further discussion at that time about 
the form of the contribution, the designation of committees, or an}-- 
thing with respect to the procedures with respect to the contribution? 

Mr. Semer. Excuse me, I think the question came up and, as I recall 
it, he was reassuring me that those details would l)e taken care of. 
I believe he regarded them as details. 

Mr. Weitz. Did he indicate that he would take care of them, or that 
he expected you to take care of them ? 

Mr. Semer. I don't believe he ever told me that he expected me to 
take care of them because the entire mechanism for })olitical fund- 
raising and contributions, which I was familiar with because I was 
actively engaged in it every day, meant that people who controlled 
the policy decisions for giving and the iwlicy decisions for receiving, 
w^ere the ones who could control the techniques used in reporting the 
funds. 

Mr. Weitz. Did he ever indicate to you that he preferred in connec- 
tion with a contribution, that it not be reported ? 

Mr. Semer. I don't recall his saying that to me. 

Mr. Weitz. Is there anything else that you can recall about the 
August 2 meeting, when you delivered the cash to him ? 

Mr. Semer. The only thing that T can recall about that meeting 
that differed from the earlier ones, which was roughly the same 
airlines schedule out of Dallas to Newport Beach, is that we were 
about an hour and a half late getting together because of a misimder- 
standing about the place where we would have breakfast; and we 
were very late in meeting in his office. It was not too long after he 
counted the money that I had to start back to get my plane. 

Mr. Weitz. But with respect to the actual meetins: and discussion 
with him that day. do you recall anything else that was said or 
anvthinix else that was discussed ? 

IMr. Semer. Well, T do recall his expressions of appreciation for 
the contribution. 



7205 

Mr. Weitz. What was your understanding — well, we covered this. 
I don't mean to constantly ask you again. Did he again indicate what 
the contribution would be used for, who would receive it, or how it 
would be applied ? 

Mr. Semer. I believe that he indicated that the contribution would 
be applied to the upcoming 1970 campaigns. This was then August 
of 1969. There was more relevance in 1969 to that particular point, 
than there was when we first met in March. 

Mr. Weitz. Now, Islr. Nelson and INIr. Parr have testified in execu- 
tive sessions before the committee that they did not know what the 
money was to go for. Is that consistent with your—or does that re- 
fresh your recollection in any way, as to conversations you had with 
them, or the discussions that you had about the contribution? 

]\f r. Semer. I don't know what INIr. Nelson and Mr. Parr may have 
had in mind when tliey said that. I think they were quite experienced 
in giving to many different kinds of campaigns. 

Mr. Weitz. Let me add to it this way. For example, Mr. Nelson 
said that for all he knew it may have been a legal fee or retainer 
for jNIr. Kalmbach in an effort to gain access to the administration, 
and he wasn't clear whether it was to be a contribution or legal fee. 
Rut in any event, he had no specific purpose or knowledge as to the 
use of the funds for any particular candidate. 

IVIr. Semer. There's the possibility that a contribution which would 
be made to Mr. Kalmbach, a lawyer, in the form of a legal fee, never 
came up between Mr. Kalmbach and myself, or between the client 
and myself. 

Mr. Weitz. Now I believe you stated that recently last year, you by 
chance ran into Mr. Kalmbach, and he indicated that money was, in 
fact, used for the 1970 congressional campaign; is that right? 

Mr. Semer. That's correct. We met by chance in the lobby of the 
Madison Hotel, and he was with his partnei-, Mr. T)e Marco. Mr. Kalm- 
bach said, not in Mr. De Marco's presence, as I recall, but privately 
to me, that he was on his way to an interrogation, that he expected 
questions to come up with regard to the milk producers' contributions 
in the years 1971 and 1972, and that he did not believe that the ques- 
tions would be raised Avith respect to contributions in 1969. But if they 
were, if these questions were raised with respect to 1969, not to be 
concerned about them, because that money went into the 1970 cam- 
paign. 

Mr. Weitz. Do you remember when this conversation took place? 

Mr. Semer. I did not make a note of that meeting with Kalmbach. 
As I say, it was a chance meeting. I do know that he was in town for 
some interrogatory, and I do know that it was in 1978. 

Mr. Weitz. Now, Mr. Semer, was it in the spring? Was it almost 
a year ago, as opposed to 2 months ago ? 

Mr. Semer. Yes. I would say it Avas in the spring or early summer 
of 1973. 

Mr. Weitz. Now, Mr. Kalmbach was deposed in the case of Nader v. 
Bvts, which, of course, involves contributions to the President in 
1971-72 by the milk producers, on April 30, 1973. Ts that consistent 
with youT- recollection as to approximately the time that you may have 
met with Mr. Kalmbach in this chance meeting? 

Mr. Semer. Yes. 



7206 

Mr. AVeitz. Now, on page 8 of Nader v. Butz — ^and this is the second 
deposition of Mr. Kahnbach, December 13 again, to which I referred 
earlier — on page 8 he was asked, ratlier he recounted what became 
of the money he received from you in August of 1969, and he states 
as follows : "Finally, at a future date, Mr. Semer came to this office 
in Newport Beach and delivered to me $100,000 in cash, which I placed 
in a safety deposit box here in Newport Beach," and he goes on to say — 
ho was asked how long tlie deposit stayed in that box in specie. And his 
answer is : 

There were deductions, withdrawals from the .box, and later additions to the 
box, so I regarded it really as fungible, and so I have no knowledge really as to 
when that parti'jnlar $100,000 was totally withdrawn. There were withdrawals 
from the box and there were additional deposits into the box throughout that 
period, throughout up until 1972. 

Is that consistent Avith what he told you ? 

Mr. Semer. He didn't tell me where he was going to put that. 

Mr. Weitz. Is that consistent with what he told you in 1973? 

Mr. Semer. Well, if he took money out of that fungible source, it 
raises a tracing problem that is beyond my talents to figure out with- 
out any more information than what you've read. 

Mr. Weitz, And if, in another deposition, IMr. Kalmbach has testi- 
fied that he used the moneys in that box in California to finance the 
activities of Anthony Ulasewicz and also to finance the candidacy 
of Mr. Brewer in Alabama against Governor Wallace in 1970, is that 
consistent with what he told you in 1969 or 1973? 

Mr. Semer. No, it is not. As a matter of fact, I just learned for 
the first time on the radio this morning, as to the possible use of that 
fund, and this is almost beyond belief. 

Mr. Weitz. Now, I just have several more questions in connection 
with the aftermath of the contribution, and then we can take a recess. 

Shortly after the delivery of the money to ISIr. Kalmbach, did you 
again speak with him with respect to making contact witli a partic- 
ular individual or other individuals in the White House? 

;Mr. Semer. I received a message over the telephone, possibly from 
Kalmbach, more likely from Gleason, to call Harry Dent of the White 
House staff to make an appointment for the client to see Dent, and 
that appointment was made for August 19, when Mr. Nelson and Mr. 
Parr and I went to the White House and saw Mr. Dent, and possibly 
Gleason, who was then working for Mr. Dent. 

Mr. Weitz. Did Mr. Kalmbach tell you that he had been in con- 
tact with anyone in the White House to inform them of your interest to 
meet with someone there ? 

Mr, Semer. He never mentioned anyone specifically that he would 
be in touch wath, but increasingly he gave me the impression that he 
was not only acquainted, but influential with, the White House people. 

Mr. Weitz. Did he tell you that he called Harry Dent, or was going 
to call Harry Dent ? 

Mr. Semer. He did not say that, as I recall, 

Mr. Weitz, But if he has testified that he, in fact, did, that would 
not be inconsistent with the circumstances ? 

Mr. Semer. No. 

Mr. Weitz. Did he indicate that he had talked to anybody else in 
the White House about your client and their interest with meeting 
with people in the White House ? 



7207 

Mr, Semer. Not that I recall. 

Mr. Weitz. Did he ever tell you that he talked to Mr. Ehrlichman 
about this ? 

Mr. Semer. No; he did not mention Mr. Ehrlichman's name, 
although on one occasion, I think the first occasion in his office, it 
was a White House call — I don't know whether it was from the 
White House or whether it was one that was put in by Mr. Kalm- 
bach— that I believe might have been Mr. Ehrlichman. 

Mr. Weitz. Did he tell you that he reported the fact of the contri- 
bution to Mr. Haldeman ? 

Mr. Semer. No ; he did not, that I recall. 

Mr. Weitz. Wliat was the purpose of the meeting with Mr. Dent ? 

Mr. Semer. The purpose of the meeting with Mr. Dent was two- 
fold : First, to get the client acquainted with a White House staffer ; 
and secondly, as indicated in the memorandum, a copy of which I 
have given the committee, to invite the President to attend the annual 
convention of the client group. 

Mr. Weitz. Now I would like to show you Parr exhibit 2,* a copy of 
a memorandum to Mr. Dent, dated August 19, 1969. Is this a copy of 
the memorandum that you prepared and was submitted to Mr. Dent? 

Mr. Semer. Yes; that's a copy of a memorandum from Harold 
Nelson, then the general manager of the client group, and this is a 
memorandum that was prepared in my office in Washington in con- 
sultation with the client. 

Mr. Weitz. Do you connect the meeting with Mr. Dent and the 
subsequent contacts between the dairy people and the White House 
people to the contribution in August of 1969 ? 

Mr. Semer. No ; I don't, Mr. Weitz. 

Mr. Weitz. Now Mr. Kalmbach in his deposition on page 13 has 
stated, "I think that in my conversations with him," meaning you, 
Mr. Semer, "it became my belief that at some point after he had made 
a contribution, that Mr. Semer would come to see me and ask me to 
introduce him to people in the White House, or in the Government, 
simply so that as an attorney for this particular client, he could make 
a case for whatever matter he wished to discuss with these people." 

Now do you remember either giving that impression to Mr. Kalm- 
bach, or is it your understanding that he could have drawn that 
conclusion from the contacts that had been made throughout 1969 ? 

Mr. Semer. I would be very much surprised, Mr. Weitz, that Mr. 
Kalmbach, a very sophisticated attorney, would draw a conclusion 
that the contribution of the money would tie in with the meeting 
with a person, such as Harry Dent, in the White House. 

Mr. Weitz. Well, on page 14, in recounting what he told Mr. Dent 
when he called him in connection with the milk producers, he said 
he was asked, "AVliat did you say to Mr. Dent ?" and his response is, "I 
said that this is an attorney whose clients are supportive of the Presi- 
dent, and indicated to him that I would appreciate it if he would meet 
with him," 

Now, would not the fact that the contribution make the people, in 
fact, supporters of the President, whereas in fact, the previous year 
they had not been supporters of the President ? 



♦See Book 15, p. 6900. 



7208 

Mr. Semer. Well, I don't know the context with which Mr. Kalm- 
bach ssLjs that. On the face of it, if tliat's what he says, then those 
are the standards b}' which he makes judgments in politics. I can't 
disagree with his point of view. I cant challenge that, if that's his 
point of view. 

j\Ir. Weitz. Now I have here, I believe, subsequent to your meeting 
on the 19tli with ]Mr. Dent — was there a subsequent contact that you 
had in 1969 with either Mr. Dent or Mr. Gleason in connection with 
your dairy client ? 

Let me specifically, actually direct your attention to September 16, 
1969, both to a letter of that date, and also to some type of a contact 
or perhaps telephone call. Does your log indicate there was, in 
fact, a contact with Mr. Gleason or a message from him that day? 

Mr. Semer. Yes. 

Mr. Weitz. And what was that message or contact ? 

Mr. Semer. The message says — exactly quoted from the log, "Glea- 
son — no MPI this month. What else does MPI want?" 

Mr. Weitz. What does that mean to you ? 

Mr. Semer. As best as I can reconstruct that, what it meant was that 
Gleason and I, who had been staying in touch with one another, wanted 
to know what the client was interested in, and from the notation it 
would seem that I had not called in to Mr. Gleason so far that month. 

Mr. Weitz. Let me enter this. Is this a copy of that log, and if so, I 
would like to enter it as exhibit 2 ? 

Mr. Semer. Yes ; it is. 

["Wliereupon, the document referred to was marked Semer exhibit 
No. 2 for identification.^] 

Mr. Weitz. Now, I also have a letter also dated September 16, 1969. 
from Mr. Gleason to you with respect to appointment of Associated 
Dairymen people to possible committees, and so forth. Is this a copy of 
the letter you received from Mr. Gleason ? 

Mr. Semer. Yes ; it is. 

Mr. Weitz. I am marking that as exhibit 3 to your testimony. 

[Whereupon, the document referred to was marked Semer exhibit 
No. 3 for identification.-] 

Mr. Weitz. Did there also come a time later in 1969 when you re- 
newed — I believe, in December of 1969 — renewed efforts to extend an 
invitation and have the President attend some other functions, some 
other dairy function ? 

Mr. Semer. Yes; there was an occasion around the 1st of December 
when the client called and asked me to get in touch w^ith such contact 
as I had, which was supposed to be Gleason, and tell him that there 
was a meeting of the National Milk Producers' Federation scheduled 
for Fayetteville, N.C., on Saturday, December 6. 

Excuse me; I think the convention was scheduled for that weekend 
beginning possibly Friday, and that to make an effort to see if the 
President, who was either on his way to his Florida home or coming 
from the Florida home, would touch down at that place and walk onto 
the stajre of the convention. 

Mr. Weitz. I understand that he did not do so that year. 

Mr. Semer. That is risht. The President did not. 



Spe p. 7224. 
Seep. 7225. 



7209 

Mr. Weitz. Are you aware that the subseqiicnt year, 1970, and the 
following year, 1971, the President did, in fact, meet with, first Mr. 
Nelson and Mr. Parr, and then later with the dairy groups, and then 
did attend a convention of theirs ? 

Mr. Semer. As I understand it, Mr. Weitz, during 1969 the Presi- 
dent did not appear at any conventions of the milk producers, that 
he did not appear the following y«Mir in Chirago at the first annual 
convention of the Associated Milk Producers, Inc., even though a 
strenuous effort was made to get the President or the Vice President 
that year, but that the President did appear at the second annual 
convention in Chicago in 1971. The convention of the milk federation 
for Fayette ville was not the organization that Mr. Nelson and Mr. 
Parr were running. It was a largo federation of milk producers that 
I believe Mr. Nelson and Parr wanted to have some influence with and 
])elieved that they could achieve that by arranging for the President 
to touch down in Fayetteville, N.C., for the convention. 

Mr. Weitz. You also mentioned tlie Vice President. Let me direct 
your attention to your log of September 26, 1069, and there is a nota- 
tion on that day : "Bob Lilly — November 20, V.P. Dairymen's, Inc. 
letter to Stan Blair.'' Did that relate to an attempt to extend an in- 
vitation to the Vice President to attend the meeting of Dairymen, Inc. ? 
Mr. Semer. It may have. I don't have any more recollection than what 
appears on the log. 

Mr. Weitz. Is this a copy of the log from your calendar with that 
notation ? 

Mr. Semer. Yes, it is. 

Mr. Weitz. I'd like to, and I waiit the record to show that it's been 
excised of other irregular, irrelevant matters, of other client matters, 
and it's been excised as of that day, let me enter it as exhibit 4. 

[Wiereupon, the document refei-red to was marked Semer exhibit 
No. 4 for identification.*] 

Mr. Weitz. I just have a few more questions. First, do you have any 
knowledare of the arrangements becfun in December 1969 for the pay- 
back to TAPE from corporate funds of the $100,000 delivered to Mr. 
Kalmbach in August ? 

Mr. Semer. No, sir. 

Mr. Weitz. Do you know, in fact, whether that wasn't in fact 
accomplished? 

Mr. Semer. No, sir. 

Mr. Weitz. Do you have any knowledge of. first of all, of any meet- 
ings in 1970 between the dairy peoi)le. Mr. Nelson and Mr. Parr and 
Mr. Colson. and anv i^ledges made to Mr. Colson or others at the White 
House, of substantial contributions, as much as perhaps $2 million to 
the President's reelection ? 

Mr. Semer. No, sir: with one possible speculation, that sometime 
after Mr. Colson joined the White House stafi'. he had as a general as- 
signment liaison with associations aud that the milk producers was 
one of the associations over which he had jurisdiction. 

Mr. Weitz. I believe you met in July of 1970 with Mr. Mitchell. 

Mr. Semer. That is correct. 

Mr. Weitz. Briefly, now, did you, in the course of that meeting, 
discuss the milk producers or any "possible conti-ibutions on their part? 

*Seo p. 7220. 



7210 

Mr. Semer. I told Mr. ]\Iitchell on that occasion, and that was not the 
principal purpose of my meetin^^ with him, that I believed that I was 
blacklisted at the White House, and I rejjrotted it very much. 

Mr. Weitz. Do you know the reason for your being blacklisted? 

Mr. Semer. I did not at the time. no. 

Mr. Weitz. Did he, in fact, at tlic time tell you ? 

Mr. Semer. No, he did not. 

Mr. Weitz. Did you ever lear]i from him subsequent to the time 
that that was the case ? 

Mr. Semer. I believe he must have made an inquiry or checked on it, 
because I received a phone call from Mr. Gleason sometime after that, 
saying that — I don't recall specifically how Mr. Gleason put it, but 
it was pretty obvious at the time that Mr. Gleason, who w\as the per- 
son who was the source of my speculation that I was blacklisted at 
the White House, if in fact, Mr. Gleason did not in fact specifically 
say I was blacklisted at the White House. He indicated that some- 
thing was being done, but I don't recall whether he said it was by Mr. 
Mitchell or by himself. 

What had happened is that an article describing my activities with 
the Muskie campaign was being circulated in the White House. 

Mr. Weitz. Well, maybe I don't understand you. Was his response 
then confirming or not confirming your suspicion that you had been 
blacklisted? 

Mr. Semer. Well, Mr. Gleason, T believe, was the original source of 
information that I was blacklisted by the White House. I believe 
from the very start he indicated the reason I was being blacklisted 
was my association with the Musl^ie campaign, or at least he indi- 
cated that it was a Xerox copy of a newspaper story that was being 
circulated in the White House," and that the content of that newspaper 
story was my association with the Muskie campaign. 

I 'told him that when I talked to Mr. ;Mitchell T had brought this 
up, and T just don't recall w^hat Mr. Gleason's reaction to that was. 
Mr. Gleason did not shut me out f lom telephone conversations. When 
he told me that I was blacklisted by the AAHiite House, he was having 
some problems of his own. 

Mr. Weitz. On the other hand. Mr. Gleason left the White House, 
I believe the records showed on ,lune 80, 1970, so his being receptive 
to you wo\ild not necessarily mean that those still at the White House 
were or were not 

Mr. Semer. Well, hindsight indicates tliat I was on some kind of 
an enemies list in the White House, and that, I'm not too sure what the 
protocol was among White House people for handling those of us 
who were on the enemies list, but I never ]iad any problems in con- 
versations with Mr. Gleason. 

Mr. Weitz. After the consultation Avith the client in 1960, with 
respect to contacts with Mr. Kalmbach, and the subsequent degree of 
l^ayment of contribution to him, did you at any further time consult 
with a client about possible contributions to "Republicans or Republi- 
can candidates. 

Without getting specific, I'd rathei- you just answer in a general 
manner as a general matter. 

Mr. Semer. I believe I did because tlu'oughout 19G9 and 1970 I was 
also encouraging the client to make contributions to the Muskie camp. 



7211 

Mr. Weitz. No, I said Republican candidates. My question was 
whether you consulted with them or t hey with you concerning Republi- 
can contributions. 

Mr. Semer. I don't believe so. I believe that after that August 2 
meeting with Mr. Kalmbach, I had no specific discussions with a client 
on political contributions except tliose that I initiated in trying to 
raise money for Senator Muskie. 

Mr. Weitz. Wasn't it also your utulerstanding that sometime there- 
after in 1969 or 1970, they retained another Hrm that was specifically 
Republican-oriented and advised them witli respect to Republican 
contributions ? 

Mr. Semer. I learned much later that they had retained other coun- 
sel and representatives and I did not know that the purpose of con- 
sulting any one firm was to get advice on how to make contributions 
to Republicans. 

Mr. Weitz. But, in any event, they didn't consult with you con- 
cerning any such contributions aftei- 1 969 ? 

Mr. Semer. That's correct. 

Mr. Weitz. So the fact that you did not know of any pledges to 
Mr. Colson with respect to Presidential contributions in 1970 or any 
discussions or actual contributions to the President's reelection effort 
in 1971 or 1972 by the dairy people, that isn't inconsistent, that doesn't 
mean that they don't, that it doesn't exist, but its rather consistent with 
the fact that 'you were not consulted with respect to any such con- 
tribution ? 

Mr. Semer. I was not consulted. Well, I don't rule out the pos- 
sibility that after that August meeting with Mr. Kalmbach, that the 
client "and I discussed contributions which would include contribu- 
tions to Republicans as well as Democrats. I don't rule that out. 

Mr. Weitz. You have no recollections ? 

IVIr. Semer. I have no recollection, and there were other contribu- 
tions given by the milk producers to candidates other than Senator 
Muskie— Democratic candidates other than Senator Muskie. 

Mr. Weitz. Then you have some recollection of, but not neces- 
sarily 

Mr. Semer. I have specific recoi lections and records of those to 
the extent that they were brought to my attention in my capacity as 
Muskie treasurer. 

Mr. Weitz. Yes, these were in 1970 ^ 

Mr. Semer. Yes. In addition, as we discussed earlier, there were 
off-year elections in 1969 to whicli contributions were made and one 
specifically that I was involved in. 

Mr. Weitz. Do you know of any contributions, other than what 
you've read in the paper, by the dairy co-ops and the dairy trusts that 
either intended or used for the Presidential campaign of 1972 to either 
Democrats or Republicans, other than what you've read in the paper? 

Mr. Semer. No. 

Mr. Weitz. I have no further (juestions. Det's take a short recess. 

FA brief recess was taken.] 

Mr. Plotkin. I just want to ask you one question, Mr. Semer, with 
regard to the $100,000 delivery made to ISIr. Kalmbach. As a point 
of clarification, more than anything else in your interview here on 
January 21, you stated that you could not recall telling Mr. Kalm- 



7212 

bach that the $100,000 was from TAPE. Today you stated that you 
did tell him. Has sometliing intoivened in the last couple of weeks 
which has refreshed your recollection of this? 

Mr. Semer. What was the qupFtion to wliich I answered "TAPE"? 
I remember answering the question specifically "TAPE" today, I don't 
have a specific recollection whetlior Kalmbacli asked from whom the 
contribution came and distineni^lied between milk producers and 
TAPE. If that question had beoi ))ut, I had no doubt in my mind that 
the contribution was from TAPE. I think in the context that 
Mr. "Weitz asked the question, 1 believe now^ he was trying to make 
the distinction between TAPE and the coi'}rorate contributor. Is that 
correct ? 

Mr. Weitz. Well, let me just apk as a general matter, did you dis- 
cuss specifically who the source was other tlian your client or the dairy 
people, without regard to corporate or noncorjiorate? 

Mr. Semer. No. I don't belicNc that que.stion came up. It was as- 
sumed all along that this was foi' political contributions — was TAPE 
and would be TAPE as tlio contributor. 

Mr. Weitz. But your best recollection is that it wasn't raised 

Mr. Semer. I don't thinlv an issue was ever made of that. 

Mr. Weitz. Especially at the time of the delivery ? 

]\Ir. Semer. Correct. 

Mr. Plotkin. You made reference to blacklisting at the White 
House. Do you find an^^thing, or did you find anything inconsistent in 
the fact that on the one hand yo\ir client had solicited your support in 
making connection with the Wliite House, or the administration, I 
should say, and on the otlier hand, vour active involvement of several 
years standing on Senator Muskie's behalf ? 

Mr. Sexier. I honestly don't Iniow what the reason for the black- 
listing was, if that's not an inapi)ropriato phrase for the so-called 
enemies list. I don't know when the enemies list was first put together 
and I don't know to what extent it was just Muskie or whether it was 
something else, I just don't know. 

Mr. Plotkix. But I mean, do you see anything in your own mind 
as being inconsistent in raising funds for one man who was potentially 
a Presidential candidate in opposition to the incumbent, who you were 
also raisinsr funds for indirectly? ]n other words, when you think of 
it in practical matters, we're not talking about just the fact that milk 
producers was a client. We're thinking of it in terms of you were try- 
inof to do work for them, at the same time knowing that your past 
history has obviously been extensively invoh^ed in Democratic admin- 
istrations and Democratic candidates. I don't see anything from the 
material I've read that shows any past involvement with the Repub- 
lican Party affairs. 

Mr. SE:\rER. Well, I guess I missed the import of the question. I knew 
nothing about enemies lists except what I read in the newspaper, and 
I knew nothing about a Ijlacklistinef other than what Mr. Gleason told 
me in 1069. 

Mr. Plotkix. And you can't conceive of any reason why you would 
be on such a list beyond what you, of course, stated ? 

Mr. Semer. I don't feel that I have anv expertise whatsoever. Cer- 
tainly not as a matter of specific information, nor as a matter of spec- 



7213 

ulation as to the reason why enemies lists or blacklists were put to- 
gether and how you get on and how you get olL I just don't know. 

Mr. Plotkin. I'd like to show you a document that I believe you 
prepared dealing with contributions to the Miiskie Election Committee, 
and I take it that these contributions were for 1970; although they 
were raised in 1970 — Senator Muskie's reelection. Have you ever seen 
this document before ? 

Mr. Semer. Yes, sir. 

Mr. Plotkin. Can you tell us a little of the background that led to 
its preparation ? 

Mr. Semer. This is a document prepared by me as treasurer of the 
Muskie Election Committee and it was prepared during the last calen- 
dar quarter of 1970, It was a chronologically arranged list of contribu- 
tions from November 2 to December 29, and, if accompanied by a com- 
parable report on disbursements, would constitute the kind of report- 
ing I was doing to the Clerk of the House. This particular list of con- 
tributions was prepared but not reported at what would have been the 
January 1, 1971, reporting date. 

Mr. Plotkin. This was never repoited, in effect, then ? 

Mr. Semer. That probably turned up in reports at subsequent dates. 

Mr. Plotkin. Do you have specific recollections? 

Mr. Semer. I don't have any specific recollection, but Senator 
Muskie's people, who took over following my service in that role, did 
disclose lists of contributors that might have included some of these 
people. That list was disclosed in connection with the disclosure of 
contributions not required prior to the April 1972 change in rules 
for political fundraising and contributions. These were the types of 
reports that were not required by law and which I gratuitously filed 
with the Clerk of the House, and this was my practice as Muskie treas- 
urer so long as I had any control over the function. 

Mr. Plotkin. Do you know Stuait Russell ? 

Mr. Semer. No. I don't. I have never met him. I know who he is now. 
which I learned in connection with the publicity given to him in the 
last several months. 

Mr. Plotkin. Do you recall beina; contacted by Ted van Dyk with 
regard to the contribution that AMPI wanted to make to the Muskie 
campaign ? 

Mr. Semer. I was not contacted by Ted van Dyk, The information 
about Ted van Dyk's contributions on behalf of my client was trans- 
mitted to me by Robert Nelson and the deputy director of the Muskie 
Election Committee staff who transmitted to me the letter that, I be- 
lieve, was sent by Mr. van Dyk describing the pattern and amounts of 
contributions, not only from the client, but to other orfranizations in the 
dairy producer field, and I have made that available to the staff. 

Mr. Plotkin. Do you find it at all unusual, given the subsequent in- 
formation that we now have with regard to Mr. Russell's activities, 
that a contribution was made in his name foi- $5,000 after the election? 

Mr. Semer. I did not know who Mr. Russell was. The best recollec- 
tion I have is that the client had used its influence with contributors to 
make contributions to the Muskie campaign and that one of them is, 
I know, say, retrospectively, in going over the records, was a Mr, 
Stuart Russell, whom I didn't know at the time and have never met. 
And, as far as the contribution being a postelection contribution, I 



7214 

contimicd soliciting political contributions after the 1070 election as 
I (lid after the 1968 election inoido' to liquidate deficits. 

Mr. Plotkix. I'd like to show you a letter. Have you ever seen this 
letter before, to Mr. NicoU from I\ir. van Dyk? 

Mr. Semer. Yes. 

Mr. Plotkin. With recrard to ))ara<rrapli 2, would you read that 
please ? 

Mr. Semer. Paragraph 2 of tliis letter of July 9 from Ted van Dyk 
to Don Nicoll, N-i-c-o-l-l. who was then the director of the staff of the 
Muskie Election Committee campaign. Paragraph 2: "I'll send you a 
memorandum, and list, re this f i)Ocial milk program. The Senator 
offered to help on this." 

Mr. Plotkin. Now, can you toll us, to the best of your knowledge, if 
you have any knowledge of the subject, what the special milk program 
was that Mr. van Dyk was referring to ; and what help, if any, Senator 
Muskie had offered ? 

Mr. Semer. I have no notion of what Mr. van Dyk was talking about 
nor do I know of what the Senator's reaction was, if that was raised 
with him. 

Mr. Plotkix. Either contempoianeous or present recollection ? 

Mr. Semer. That is correct. 

Mr. Plotkix. Now, a letter thai you sent to Mr. Parr, which is ap- 
parently undated, but he apparently received it July 20, 1970 — would 
you please look at this letter and sco. if you can identify it and endeavor 
to explain to us what it says or what it means ; this is totally ambiguous 
tome? 

Mr. Semer. Well, in this letter from me — is from me to David Parr. 
The following points are being made and obviously, as it says, as a 
followup to a telephone conversation that I had with Mr. Parr. As 
I recall, this was w^hat was then in the works in the summer of 1970. 
First, I was trying, obviously, with Bob Lilly to help the client, 
AMPT, or Associated INIilk Prod dicers. Inc., to coordinate; and I guess 
the language that we use today and we didn't use in 1969 or 1970 was 
the inputs from people that they worked with, with regard to the sub- 
stantive intelligence and also in the way that they made political 
contributions. There wns a pattern of political contributions which is 
reflected in another set of mateiials that I made available to you in 
which three dairy organizations divided the burden of political con- 
tribution in mathematical!}^ precise thirds so that it came out to rather 
unusual numbers, and. T believe, this is what the import of this is in 
the sentence. 

Although the figures are mathematically precise, they raise ques- 
tions of logic and crediliility which we may find difficult to answer, 
and this is with regard to checks received in these unusual amouiits by 
the Muskie Election Committee and these are the checks that Mr. 
van Dyk gave to the Senator's jxople either at or following a meet- 
ing, or before, for all T know, a meeting with the Senator which 
Avas then routinely transmitted to me by !Mr. Bob Nelson, the No. 2 
man in the IMuskie staff. 

Mr. PLO'nvVX. What luoblems of credibilitv did you foresee in view 
of the fact that these were 

^fr. Semer. Well, the problem of credibility at that time was that 
there purported to be contributions from three different sources, some 



7215 

of which, I believe, were personal in nature or appeared to be per- 
sonal that seemed to be coordinated from a common policymaking 
source, and, that, although, I had no problem with it since I im- 
mediately put it into the public domain, I didn't know what they had 
in mind and also, if I couldn't explain it, perhaps others couldn't 
and that leads to the second paragraph which also contains one sub- 
stantive and another probably protocol point and that was by way of 
telling Mr. Parr, in writing, that I thought the procedure for dealing 
with the Senator's campaign was not correct : that I was a little miffed 
which I had indicated to him over the telephone, and that the ap- 
proach to the Senator and his campaign should be principally sub- 
stantive and intellectual, which is a phrase used here, and that if this 
were a significant contribution, then I'd see what I could do to get 
them together with the Senator personally because the Senator, in my 
iudgement, as a campaign man for him, was not only interested in, 
but should be interested in what is called here the entire agri-political 
scene. Since the milk producers were quite ambitious in what they 
hoped to cover geographically, that is, go right up the Mississippi 
Valley, form alliances with people in the Southeast, which, I believe, 
is called Dairyman's Inc., and perhaps in other parts of the country 
as well, that they would be important, influential, knowledgeable 
beyond milk. That they would, because they had worked with rural 
co-ops, the other farm organizations, that they were people who could 
help us. 

The significant contribution I was talking about was a significant, 
substantive, intellectual contribution but was not a significant fi- 
nancial contribution, which was the phrase used in that paragraph, 
and that's what it means because there was great difficulty in getting 
everybody in the Muskie camp briefed as to the nature of agriculture 
outside of his own home State of Maine. 

Mr. Plotkin. I don't want to nitpick but your reference to private 
session at his cottage in Maine or his home in Maryland, why not his 
office ? 

Mr. Semer. Because I think we had iust seen him in his office and 
what T was saving was that I thouirht that the way to get acquainted 
with the Senator as a person, according to my experience, would be a 
substantive approach that would load to his being interested in what 
they had to say intellectually. This was my experience with the Sena- 
tor from the years that I had speiit with him and this was my recom- 
mendation as to how the milk peo])]o should approach the Senator in 
contrast to the a]:)proach that was used just a few davs before. 

Mr. Plotkik. I have a very difficult time reconciling in my mind 
durincf a political campaif^n when the Senator was in great need of 
contributions, that he would be so terribly concerned at that specific 
moment in time in sittinc: down and developing an intellectual rap- 
port, rather than trving to raise canipaion funds or trvinc to worry 
about the intellectual aspects of it at a future time, I don't want to dis- 
parage the Senator in any way, I <1on't doubt the man's integrity, but 
it iust seems that under these circiimstancos it raises a question. It 
raises a question of credibility in niv mind as to how at this particular 
moment in time, he was more concerned with their intellectual atti- 
tudes with regard to subiocts of mutual interest. 



7216 

Mr. Semer. This is my opinion which was not checked with the 
Senator personally and, not only my opinion as the treasurer for the 
Muskie election committee, but also my opinion — my opinion to a 
client, that this was the approa(^]i that I would recommend to getting 
acquainted with Muskie and his campaign. 

Mr. Weitz. I just Avant to make two comments for the record. One, 
I think, although sometimes it's liard to adhere to it closely, that coun- 
sel and investigators for the staff should limit ourselves to questions 
leather than our own conclusions or opinions of the evidence or the 
testimony before the committee. And second, although I will not ob- 
ject to the point of preventing the questioning, this is now the second 
time that the staff had had an opportunity to interview Mr. Semer and 
particularly with respect to the contributions, that he has been ques- 
tioned about, to the Senator in 1970 ; again, as I think before, there has 
been no basis, either in evidence that we have or in the testimony here 
today, that the contributions were anything but contributions to the 
Senator's 1970 senatorial campaign and, thus, I would like to note it for 
the record that our position would be that this questioning and this tes- 
timony fall outside of the mandate of the committee, but in so saying, I 
don't want, for the purposes of investigation, to foreclose the question- 
ing, but also to make it very clear for the record what our position is. 

Mr. Plotkin. Counsel's nonobjection is noted. Mr. Semer, did you 
raise, or seek to raise, any campaign funds for Congressman Mills in 
either 1970 or 1972? 

Mr. Semer. No, sir. 

Mr. Plotkin. Did you seek to raise any campaign funds for Con- 
gressman Poage or Melcher in 1970 ? 

Mr. Semer. No, sir. 

Mr. Weitz. The brevity of that response precludes or moots the need 
for me to comment on that too. 

Mr. Plotkin. Now, just a couple of final points. We were talking 
about the $5,000 contribution made by Mr. Eussell in 1970 and I see 
that you wrote him a thank-you note' December 1, 1970. Would you 
just quickly look at this and see if that's something that was sent to 
him? 

Mr. Semer. Yes; that was a thank-you note that we sent to all con- 
tributors. 

Mr. Plotkin. Now, was it your policy to send a thank-you note to 
each and every contributor, a form letter, or was this an individually 
dictated letter, which was the impression I would get ? 

Mr. Semer. It is a letter that the girls in my office sent to all con- 
tributors unless some special effort was made to vary it. That was the 
form letter. 

Mr. PlotivIn. Is that in fact your signature, or is tliat a stamp, or 
did one of the secretaries sign for you ? 

Mr. Semer. It's pretty close. I tried to sign all of them. If on some 
occasions I didn't, I take the responsibility for my girls signing my 
name to it. Usually they would put a little notation on it, but it could 
have been either. The general style of acknowledging contributions 
is to personalize tlie acknowledgement. 

Mr. Plotkin. Now, a copy of another tliank-you note was sent to 
Mr. Russell in care of Harold Nelson dated December 22. 1970. sisfned 
by Senator Muskie, and the letter was then forwarded to Bob Lilly 



7217 >> 

by Mr. Russell on January 13, 1971. Would you look at these two letters 
and see if you can tell us whether the letter from Senator Muskie was 
a form letter that he sent to all contributors or all individuals who 
made sizable contributions, or whether it was just an individual letter 
with reg'ard to the specific contributions. Additionally, I'm not asking 
you to identify that second letter, just to look at it. 

[Whereupon, the first letter referred to was marked Semer exhibit 
No. 5 for identification.*] 

Mr. Semer, I don't believe that this particular letter from the Sen- 
tor to Mr. Russell has the ring of being unique or different from most 
other letters that I recall his sending to contributors. 

Mr. Plotkin. Then you don't know for a fact whether that's a form 
letter or whether it's a dictated letter ? 

Mr. Semer. I don't recall ; I avouIcI have to do some research in my 
files, which I believe would help me determine that. I can only giv^ 
you my general impression that this letter looks familiar — as the kind 
of letter that would be a supplement to the initial thank-you note that 
I would send out, and the other letter 

Mr. Plotkin. I wasn't asking about that. 

Mr. Semer. Excuse me. 

Mr. Plotkin. Now the gist of all of these questions, and I'm just 
trying to sum this up, I don't want to flog you to deatli, is that a con- 
tribution was made by Stuart Russell after the election ; a contribution 
was apparently solicited by AMPI or its employees, and graciously 
received and acknowledged by the campaign committee. 

Now, I'm not suggesting any impropriety on the committee's part at 
all. Is tliere anything, any thought that you have with regard to this 
contribution and the circumstances that were now covered that, had 
you been aware of them at the time, would have made you think that 
the contribution was from corporate fimds? 

Mr. Semer. No. 

Mr. Bamberger. If I may, I think the premise of the question is, "if 
you knew everything that you know now," and since we've read in the 
newspapers about Mr. Russell, I think that's really not a fair question. 

Mr. Plotkin. No; the premise is related just to what we're talking 
about here. I'm not asking for your outside knowledge from news- 
papers. 

Mr. Semer. The recollection that I have is that the two waves of 
contribution — one is, the contributions, I believe, aga^regating $10,000 
before the senatorial election ; and the one which is hindsight tells us 
nlso is related to the same source, which is a contribution in the form 
of a contribution from an individual — that in both instances, as Mus- 
kie treasurer, they were legal on the face of the transmissions; and in 
the case of the contributions before the election, they were duly re- 
ported, they would have been reported in that form after the election 
if we had continued that reporting policy. 

Mr. Plotkin. Do vou know when the Muskie election committee of- 
ficially closed its books ? 

Mr. Semer. It was probably sometime in 1971. 

Mr. Plotkin. You have no specific recollection about the time? 

Mr. Semer. T could research that for you. 

*Spp p. 7227. 



\ 



7218 

Mr. Plotkin. Do you know whether there were any outstanding 
sums m the account at the tune it was closed out^ 

iSIr. Semer. I don't know that as a matter of specific recollection; 
I would have to research that for you. 

Mr. Plotkin. Do you think that it is possible that there was a bal- 
ance in the account ? 

Mr. Semer. At the time I had control over the income and outgo 
of the Muskie election committee, I always had a deficit. There were 
times that T continued to be a signatory, during a transitional phase; 
but I mean that quite literally, that when I had control over it, I 
always had a deficit. 

I continued to sign certain documents as treasurer following that, 
duriiig a period in which I did not have control over the income and 
outgo of the funds. 

Mr. Peotkin. When did you officially resign as treasurer? 

Mr. Semer. There was no official resignation. 

Mr. Plotkin. When did you end, unofficially ? 

Mr. Semer. For all practical purposes, I transferred control about 
the end of the year. 

Mr. Plotkin. 1970? 

]Mr. Semer. 1970, right. 

Mr. Plotkin. I have no other questions, thank you. 

Mr. Weitz. I have two further questions. First, relating back to a 
matter Ave discussed before our earlier recess, with respect to the 
contribution to Mr. Kalmbach in 1969. From the time you delivered 
the money to him in August until the end of the year or any time 
thereafter, did you have any further conversations either with the 
client or with Mr. Kalmbach with respect to the designation of com- 
mittees or any other procedures for reporting the contribution? 

Mr. Semer. No; I did not, that I recall. If the question came up, 
it may have come up in a general way, but not in a specific form. 

Mr. Weitz. With the client, or with Mi-. Kalmbach? 

Mr. Semer. Certainly not with Mi-. Kalmbach. 

Mr. Weitz. Finally, Mr. Semer, you've understood the areas that 
we've covered with you in the questioning, particularly with regard 
to the transactions with Mr. Kalmbach and its aftermath, and in 
general with regard to the matters we've covered, is there anything 
else that— cognizant of the mandate of the committee — is there any- 
thing else relevant to the questioning which you feel is pertinent 
and whicli would amplify or make further complete or accurate your 
answers that you've given today? 

I'm just trying to elicit, in case there is something else you think 
is peculiarly relevant to the questions, but the questions do not par- 
ticularly cover your knowledge. 

Mr. Semer. Well, I appreciate the question, Mr. Weitz, and if I 
seem unprepared for it, it may be that you've been so thorough in your 
questioning up to now. 

Mr. W;.iTZ. I have no fui-ther questions. 

Mr. Prx)TKiN. Off the record for a second. 
[Discussion off the record.] 

Mr. Weitz. That concludes our executive session. 

I thank you, Mr. Semer. 

[Whereupon, at 1 :10 p.m., the hearing in the above-entitled matter 
adjourned.] 



7219 
Semer Exhibit No. l 

IN EXECUTIVE SESSION 

TESTIMONY OF MILTON P. SEMER 

BEFORE THE SELECT COMMITTEE ON PRESIDENTIAL 

CAMPAIGN ACTIVITIES, U. S, SENATE 

FEBRUARY 8, 1974 

My name is Milton P. Semer; I am an attorney practicing law 
in Washington, D. C. I am appearing to describe my relationship 
with a former client, the Associated Milk Producers, Inc. of Scin 
Antonio, Texas. 

From discussions with your staff, I understand your interest 
in my testimony to center on representation of the client during 
1969 and 1970. 

Also, in light of your staff's interest, I should note that in 
1968 I was Treasurer for Senator Muskie's Vice Presidential cam- 
paign, and when Senator Muskie ran for reelection to the Senate in 
1970, I was Treasurer of the Muskie Election Committee. 

Attached to my statement are copies of letters from the client 
to this Committee's staff setting forth the extent to which the 
client has waived the attorney-client privilege in connection with 
my testimony. 

My relationship with the client commenced on March 21, 1969, 
when representatives came to see me in Washington. We discussed 
how our Washington firm might assist them, when circumstances re- 
quired, in making a persuasive case on the merits to the Federal 
Government on substantive issues of interest to them, including 
price supports and import competition. In part, it appeared that 
this would involve presenting their arguments to the White House — 
which, during the Kennedy and Johnson Administrations, had actively 
participated in decisions on such issues, and presumably would 
continue to do so. 

At the same time, it was explained to me that the client was 
organizing a political fund, the Trust for Agricultural and Politi- 
cal Education, to raise funds from their members for distribution 
to camdidates of both major parties in local. State, Congressional, 
and Presidential campaigns. TAPE was described to me as a fund 
modeled after the AFL-CIO's Committee for Political Education, COPE, 
whose purpose would be to support and win friends on Capitol Hill 
and in the Administration and promote the milk farmer's position 
on the issues. 

Shortly after my initial meeting with the client, I began an 
unsuccessful effort to help it find out how the White House was to 
be organized, and to whom it should make its case. 



7220 



I have related the details of these efforts to your staff, 
and my purpose in this statement is to highlight the basic events 
in the chronology. 

On October 25, 1968, just before the Presidential election, I 
called Mr. John Mitchell who had served on an advisory committee 
when I was General Counsel of the housing department in the early 
1960 's. I phoned him at the behest of a client wishing to contrib- 
ute to the Nixon campaign. Mr. Mitchell had put me in touch with 
Mr. Maurice Stans, who in turn referred me to Mr. Jack Gleason. 

On March 25, 1969, following my initial meeting with the client, 
I called Jack Gleason at the White House to describe my firm's new 
client and its interest in finding out to whom at the White House 
it should direct its case. Mr. Gleason in turn suggested I deal 
with Mr. Herbert Kalmbach, and it shortly was arranged for me to 
meet Mr. Kalmbach in Washington. 

On April 3, 1969, I explained to Mr. Kalmbach the interests of 
my client. Mr. Kalmbach did not ask for a political contribution, 
but did inquire about the contribution potential of the client's 
political trust fund, TAPE. 

On July 10, 1969, I visited with Mr. Kalmbach at his office in 
Newport Beach, California. On this occasion Mr. Kalmbach inquired 
how TAPE'S fund-raising was progressing. When I explained that 
my client hoped its trust fund would collect sufficient funds to 
make contributions to a large number of candidates of both parties 
at all levels of government, Mr. Kalmbach told me that contributions 
would be appreciated by the Administration. 

At this time it was my understanding, and I thought it was Mr. 
Kalmbach's, that the client would be making, through its trust fund, 
a series of political contributions to committees for 1970 Congres- 
sional candidates, to be reported by TAPE and by the recipient 
committees. It had been a common practice for past Administrations 
to "piggy-back" such contributions — that is, to transmit them 
through the incumbent Administration, allowing it to share credit 
for the contributions with the donor — and I had discussed this 
political technique both with the client and with Mr. Kalmbach. 

Thus it was that on August 1, 1969, I flew to Dallas, Texas, to 
receive from the client for delivery to Mr. Kalmbach the next day a 
contribution of one hundred thousand dollars in cash. Although more 
than a little surprised at the amount, which was much larger than I 
had supposed it would be, I delivered the funds to Mr. Kalmbach as 
I had agreed to do. Neither then nor later did he tell me anything 
inconsistent with ray understanding of the nature of this transaction, 
as summarized above. 



7221 



ASS&CmrED MflK Pf^OD&CEflS.mC, 

HOME OFFICE 
TELEPHONE 512/341-0651 TWX 910S711072 
P.O. BOX 32287 SAN ANTOMO.TfXAS 76284 



October 31, 1?J73 



Mr. Alan VJeitz 

Senate Watergate Subcoirimittee 

G-308 Dirks or. 

Senate Office Building 

Washington. D. C. 20510 

Dear Mr. VJeitz: 

On October 29, 197 3, you orally requested that Associated Milk 
Producers, Inc. ("AMPI") vjaive in part its right to maintain the 
privilege of attorney-client confidentiality as to its communications 
with certain named attorneys concerning certain specified subjects. 
The attorneys named by you are: Milton P. Semer, Richard Maguire, 
W. DeVier Pierson, Stuart H. Russell, E. Jake Jacobsen, Joe R. Long, 
E. C. Heininger, /jithony Nicholas, Marion E. Harrison and all attorneys 
of their respective law firms who have performed legal services for 
AMPI. 

The subjects specified by you are: 

(1) The amounts of legal fees and other amounts paid to any 
attorneys by AMPI ; 

(2) Any disbursements by attorneys for AMPI including but not 
limited to direct or indirect political contributions ; and 

(3) Contacts by attorneys for AMPI with government officials, 
including any communications , relating to milk price 
supports and/or import quotas. 

AMPI will agree to waive its privilege in accordance with yovi-p 
request. However, AMPI does not waive any privilege which it may have 
as to any other individuals or subject matters. 

We believe the above statement fully and completely complies with 
your request. We would appreciate your written confirmation of this 
understanding. 

Very truly yours , 



cc : All attorneys listsd above 



_i.£.i>2.7/p4:&=::_ 

JCm K-: BUTTLKL'.ROlvr , PKESl DEI IT 
GLOKGE y:i MEHREN', GENERAL M/u-AoLR 



• r-.n--'\-t 



7222 



) IIOML oiricc 

PHONE: A/C 512 341-C651 TELCX 76-71-16 

P.O. DOX 377h7 SAN ANTONMO, TfXAS 7f.7!l'l 

November 2, 1973 



Mr. Alan Weitz 

Senate Wolergotc Suljcommittco 

G-300 Dirl;son 

Senate Office Building 

Washington, D. C. 20510 

Dear Mr. Weitz: 

You have requested that in addition to those persons and entitles enumerated 
In our letter to you'of October 31, 1973, that Associated Milk Producers, Inc. waive 
its right to maintain the privilege of attorney-client confidentiality as to any 
communications with certain additional named attorneys concerning certain specified 
subjects. The attorneys named by you are: Arthur Mitchell; Frank Masters; 
William Heatlcy; Clark, Thomas, Harris, Denius and Winters; and Vinson, Elkins, 
Searls, Connally & Smith. 

This waiver is limited to any communications on the subjects specified by 
you as follows: 

(1) The amounts of legal fees and other amounts paid to any attorneys 
by AMPI; 

(2) Any disbursements by attorneys for AMPI including but not limited 
to direct or indirect political contributions; and 

(3) Contacts by attorneys for AMPI with government officials. Including 
any communications, relating to milk price supports and/or import 
quotas. 

AMPI will agree to waive its privilege in accordance with your request. 
However, AK'iPI does not waive any privilege which it may have as to any other 
iiuiivicluals or subject matters. 

Wc believe the above statement fully and completely complies with your 
rc{iuc5t. Wc would appreciate your written confirmation of this understanding. 



cc: AIJ attorneys listed above _ 

;LK, GLMllKAL KiAMvCKi 



iruiy youi a , 



7223 



%i. li.t,. 



HOME OFFICE 
TELEPHOWE 512/341 GG51 T\VX 9108711072 
P.O. BOX 32287 SAN ANTONIO. TEXAS 78234 



November 13, 197 3 



Alan Weitz, Lsq. 

Senate Watergate Subcommittee 

Dirkson Senate Office Building 

Room G-308 

Washington, D.C. 20510 

Dear Mr. Weitz: 

Reference is made to my letters (copies of which are enclosed) 
of October 31, 1973, and November 2, 1973, in which Associated Milk 
Producers, Inc. ("AMPI") waived its attorney-client privilege with 
regard to certain named attorneys and certain specified subjects. 

On November 7th you orally requested that a subparagraph be 
added to the list of subjects in which AMPI has waived its attorney- 
client privilege: 

"(4) Any communications concerning direct or indirect 

political contributions for Presidential candidates 
by Milk Producers, Inc. ("MPI"), Associated Milk 
Producers, Inc. ("AMPI"), Trust for Agricultural 
Political Education ("TAPE"), or Committee for 
Thorough Agricultural Political Education ("C/TAPE"), 
its officers, employees or representatives during 
the period from 1969 to 1972 inclusive." 

AMPI hereby agrees to waive any attorney-client privilege it 
may possess with regard to this additional subject matter as it 
pertains to uhe attorneys named in our previous correspondence. 

Very truly yours , 



Enclosures 

cc: All named attorneys 




7224 



Semer Exhibit No. 2 



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7225 

Semer Exhibit No. 3 

THE WHITE HOUSE 

WASHINGTON 



September 16, 1969 



Dear Milt: : - ' 

Are there any people in the Associated Dairymen's group 
whom we ought to give priority consideration for a position 
on some of the Department of Agriculture Advisory Boards 
or Commissions? "We can play this pageantry pretty far if 
you've got any suggestions for people in that group whom we 
ought to push for that kind of appointment. 

I will need their names and some kind of biography on them, 
but I think we can pretty well get this in hand over at Agri- 
culture. - 

Regards. 

Sincerely, 



JaclflA. Gl< 



Mr. Milton P. Semer 

Attorney 

1156 15th Street, N. W, 

Washington, D. C. 



7226 



Semer Exhibit No. 4 



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7227 



Semer Exhibit No. 5 
Sex\tor Edmi^d S. Muskie 

\vA5HLNGT0N, D. C- 2O5I0 



De-cetaber 22, 1970 



Stuart H. Russell, Esq. 

c/o Harold Nelson " 

1011 N. W. Military Highway 

San Antonio, Texas 78213 

Dear Mr. Russell: 

Before the year ends, I want to express to 
you again my very warm thanks and appreciation 
for all your help and encouragement to me in the 
months that have passed. 

I need not tell you of the many great prob- 
lems that face and divide our country in this 
coming year, nor how vital it is that we — all of 
us toge ther--f ind a way to restore the faith, 
the confidence, the vigor, that are the great 
strength and inspiration of America. 

To succeed, 1971 must be a time of great de- 
cision backed by positive action that will move 
us irrevocably forward in the direction of our 
great hopes. I am looking to you for the wise 
counsel 'and guidance I need to assist me in f6rm- 
ulating policies and positions that will help us 
all to achieve this goal. 

So again, my thanks to you for your confi- 
dence in me this past year. And with it my wish 
for a New Year of great joy, of added accomplish- 
ment, and of deepening friendship between'us. 



Sincerely 




THUBSDAY, FEBRUARY 7, 1974 

U.S. Senate, 
Select Committee on 
Presidential Campaign Activities, 

Washington^ D.C. 
The Select Committee met, pursuant to notice, at 10 :25 a.m., in 
room G-334, Dirksen Senate Office Building. 
Present : Senator Howard H. Baker, Jr. 

Also present: David Dorsen, assistant chief counsel; Alan Weitz, 
assistant majority counsel ; Donald G. Sanders, deputy minority 
counsel ; Benjamin Plotkin, minority investigator. 

Senator Baker. Do you solemnly swear the testimony you are about 
to give will be the truth, the whole truth and nothing but the truth, 
so help you God ? 

Dr. Mehren. I so swear. 

Senator Baker. Will you please state your name for the record ? 
Dr. Meiiren. George L. Mehren, M-e-h-r-e-n. 

Senator Baker. The further inquiry will be conducted by the staff. 
Thank you for coming by. 

TESTIMONY OF GEORGE L. MEHREN, ACCOMPANIED BY ERWIN C. 
HEININGER, COUNSEL 

Mr. Weitz. Dr. Mehren, for the record, would you please give us 
your address? 

Dr. :Mehren. 406 Country Lane, San Antonio, Tex. 78209 ; that is 
my home address. 

]\fr. Weitz. And would ^our counsel please identify himself for the 
record ? 

Mr. Heinixger. I am E. C. Heininger of Mayer, Brown & Piatt in 
Chicago. 

Mr. Weitz. Dr. Mehren, just by way of background, I understand 
you were Assistant Secretary of Agriculture from 1963 until 1968; 
is that correct ? 

Dr. Meiiren. Yes, sir. 

Mr. Weitz. What was your specific title with Agriculture? 

Dr. Meiiren. I had two titles most of the time, Mr. Weitz. I was 
Assistant Secretary for Marketing and Consumer Affairs, and I was 
also Director of Science and Education. 

Mr. Weitz. Now, from June 1968, until March of 1971. you were 
president of Agri Business, Inc. ; is that correct ? 

Dr. Meiiren. I believe it was April 1971, I am not certain; yes, 
I was. 

Mr. Weitz. And during that period, after you left the Department 
of Acrriculture, for that approximately 3-year period, you were also 
a consultant for Associated Milk Producers, Inc., AMPI? 

(7229) 



7230 

Dr. Mehren. I believe at tlie initial stage I was consultant to Milk 
Producers, Inc., and was transferred to Associated Milk Producers, 
Inc., after that organization was founded. 

Mr. Weitz. Just to complete the chronology, from April 1971, until 
January 12, 1972, you were then, as I understand it, director of pro- 
graming for AMPI ? 

Dr. Mehren. Yes, sir. 

Mr. Weitz. And then, from January 12, 1972, to the present time 
you have been general manager of AMPI. 

Dr. Mehren. Yes, sir. 

Mr. Weitz. Could you tell us, in connection with the period 1968 
to 1971, as consultant, what your principal responsibility was? 

Dr. Mehren. Primarily in preparing documentation for submis- 
sion by Associated ]\Iilk Producers, Inc.. and its ])redecessor, Milk 
Producers, Inc., piincipally in conjunction with other cooperatives, 
and often with the Central America Cooperative Federation with 
respect to such matters as market orders, price support dockets, legis- 
lative submissions; that, generally, was the subject matter. 

The technical contribution was generally of two types, one was the 
assured economic validity; and tlie second was to try to make the 
submissions and the metliod of submission as compatible with normal 
governmental procedures as possible. In general, to be explicit, it was 
more of an editing function than anything else. 

For the recorcl, I think it's useful to say here that the procedure 
that was folloAved by AMPI and its related cooperatives in general, 
was to use a team of land grant university professors, supplemented 
by staff people, from anj^ one of the related cooperatives, who would 
then bring in ]:)reliminary documentation to me to be appraised for 
validity and for formal sul3mission. 

Mr. Weitz. Now, during the 8, or 9 months durin<^ which you were 
director of programing, 1971, what were your principal responsi- 
bilities? 

Dr. Mehren. The principal responsibility as I understood it, upon 
accepting the invitation to come to work on a full-time basis, was to 
do long-range planning, basic^ally, to try to determine and to project 
some 5 years into the future, what we would like AMPI to be ; what 
we would like it to be able to do, and how it would do it. 

x\s a matter of fact, it sort of shook down, ultimately, into a 
])rocedure to pick up "bon-fires," whatever was assigned to me by Mr. 
Nelson. The long-range planning never really worked out as I expected 
it would. 

Mr. Weitz. In fact, you had during that i)eriod, a substantial amount 
of involvement in day-to-day operations ; did you not ? 

Dr. Mehren. No ; not in the operational sense, Mr. Weitz. Not in 
the sense of allocating milk, or putting prices on milk, or adjusting 
milk to various order terms. 

It would be such things as appraisal of the original submission to 
NFO with respect to economics, which would be such things as basic 
market order legislation, price legislation. Very, very little contact, 
quite truly, with the routine of the day's operations. * 

Mr. Weitz. Now, prior to youi- becoming general manairer in 1972, 
did you have any contact with the organization of TAPE, Trust for 



7231 

Agi'icultural Political Education, or involvement in any decision- 
making ? 

Dr. Mehren. No, sir. Using the word "contact" now, I knew there 
was a TAPE, and I knew generally what its broad outline was; but 
with respect to its operation, I had no activity with it. 

Mr. WErrz. ">Vliat about your knowledge with respect to contribu- 
tions that were made? 

Dr. Mehren. None. 

Mr. Weitz. Were you at that time a member of TAPE ? 

Dr. Mehren. No ; I was never a member of TAPE. 

Mr. Weitz. Dr. Mehren, do you have any knowledge, either con- 
temporaneous, or knowledge tliat you received since that time — other 
than what you read in the paj^ers — in connection with any contacts 
between representatives of MPI, or AMPI in 1969, with Herbert 
Kalmbach or others representing the administration, or Republican 
f undraising, in 1969 ? 

Dr. Mehren. In 1969. Do I have it now, or 

Mr. Weitz. Either contemporaneously, or now, up to the present 
time, do you have any knowledge ? 

Mr. Heininger. Exce]>t what you read in the newspapers. 

Mr. Weitz. First of all, contemporaneously, did you have any knowl- 
edge of any meetings, or contacts, at that time ? 

Dr. Mehren. No, I did not, sir. 

Mr, Weitz. Now, since that time, have you learned of any informa- 
tion in connection with such contacts, or meetings ? 

Dr. Mehren. I'm not certain, now. I do not believe that the question- 
ing in the day I spent with the local grand jury ever directly referred 
to involvement with Mr. Kalmbach in 1968, or 1969. 

Again, if I become too discursive, you tell me; but as I recall the 
material, the information made availal)le to me and revealed to me 
tlu'ough tliat questioning process, from which I could adduce conclu- 
sions from that, went back to 1967, as a matter of fact. There were 
references to contributions in 1968 and 1969. 

But I do not think that the name of Herbert Kalmbach was used 
in that transcript. I could be wrong, but my recollection is that it was 
not specifically mentioned. 

Mr. Weitz." Other than what you learned from the grand jury, you 
have no other knowledge of such contacts ? 

Dr. Mehren. No. 

Mr. Weitz. "^Vhat about knowledge of delivery of moneys to either 
Mr. Kalmbach, or other representatives of the Republican f undraising 
in 1969 by AMPI, or AMP ? 

Dr. Mehren. I have learned of such deliveries, Mr, Weitz. I can't 
give you the date, but within the last 60 days. 

Mr. Weitz. And what is the source of that information ? 

Dr. Mehren. Mr. Heininger. 

Mr. Weftz. Do you know what his source of information is ? 

Mr. Heininger. Do you know ? 

Dr. Mehren. No. 

Mr. Heininger. My basic source of information was the Wright re- 
port. In other words, we have not gotten the Wright report yet. 

Mr. Weitz. That is an attorney who has been retained by AMPI to 
investigate prior matters ? 



7232 

Mr. Heininger. That is correct. 

Dr. Mehren. I think the record should show tliat he has been ex- 
plicitly retained by the board of directors. 

Mr. Weitz. All right. Have you ever discussed that delivery of 
money with either Mr. Lilly, Mr. Nelson, Mr. Parr, or Mr. Jacobsen? 

Dr. Meiiren. Mr. Dilly, on one occasion, perhaps 2 months ago. made 
an indirect allusion to such a delivery. And to my knowledge that is 
the only time that I have heard of it. As I recall he said something to 
the effect that the staff of this committee, and the grand jury — to use 
his language — "knew everything." He then said something, as I recall 
it, to the effect that they "even know about the big one." Again, that is 
a quote. 

And then he said "the big one" was the West. That is about as much 
as I knew prior to, I think, fairly detailed information from Mr. 
Heininger. 

Mr. Heininger. Off the record. 

TDiscussion off the record.] 

]\fr. "\Yeitz. Back on the record. 

Dr. INIeiirex. In addition to the one reference that I recall having 
been made by Mr. Lilly, Mr. Heininger, who was counsel for AMPI, 
did on one occasion read verbatim excerpts from the deposition of Mr. 
E. J. Jacobsen, relevant to this matter. 

Mv. Weitz. Do you have any knowledge — let ine start it this way : 
Did you have any knowledge in 1070 of any contact between represen- 
tatives of AMPI and representatives of the White House ? 

Dr. Mehren. I can't think of any, Mr. Weitz, truly. 

Mr. Weitz. Since that time, have you heard of any information with 
respect to any such meetings, or contacts ? 

Dr. Mehren. The infonnation that I have had. to the best of my 
recollection, again, is exclusively newspaper information; and its 
validity or accuracy I cannot say. That is 1970. iiow; in 1971, I did 
hear things. 

Mr. Weitz. Just with respect to 1970. Did you at the time, or have 
you since that time heard any information — other than what you read 
in the newspapers — in connection with any pledges of campaign con- 
tributions by representatives of AMPI to people in the White House, 
or representatives of the Republican fundraising? 

Dr. Mehren. We have discussed that various times, you and I, in 
various talks; and being questioned on this by Bill Dobrovir — I still 
do not know of any instance in which anybodv associated with the 
Wliite House, anybody associated with the election campaign, or any- 
body associated with AMPI told me that a pledge had been made for 
the contribution of anything to the 1972 campaign. 

N'ow, I believe I also told you that in the first 2 or 3 weeks of my 
tenure as general manager, I did seek to determine the nature, the 
magiiitude, of any and all commitments of any kind. I did this pi'i- 
marily because the organization was neai- bankruptcy. 

I was required in the first 2 weeks to reduce the home-office cost of 
this organization by something, I think, well over $10 million; it 
was for that reason that I inquired about commitments. 

Now, at some stage within the first week, and certainly by the end 
of the second week, I was advised that David L. Parr had stated that 
there was a commitment of $2.0 million made bv him to IVfr. Colson. 



7233 

And in the presence of John Butterbrodt whom you also know, Mr. 
Weitz, the president of the board of AMPI, I asked David Parr quite 
explicitly whether such a commitment had been made. 

Among other reasons, I asked it because by that time, Mr. Weitz, 
I knew there was only about $1.3 million in the funds. His answer was 
equally explicit. He "said that no such commitment had been made, 
and he further said that he was not acquainted with Mr. Colson. That 
was the only direct reference I know as to commitments to political 
contributions. 

Now, there were many, many other commitments that were exposed 
in this process of inquiry, some of which I felt — and the board with 
me felt — should be kept, and others were not kept. 

Mr. Weitz. OK. We will return, I think, to that period of 1972. 
I take it you also had no knowledge, other than what you just related, 
to a pledge of $2 million in 1970, to the President's reelection 
campaign ? 

Dr. Mehren. I have no explicit knowledge of that, no, other than 
the Wright report, to my i-ecollection. 

Mr. PIeininger. Off the record. 

[Discussion off the record.] 

Mr. Weitz. Back on the record. 

I take it also, however, that during that period you were not ap- 
prised, as a consultant of AMPI, of their meetings with people in the 
White House, if there were any such meetings ; or of any discussions 
of campaign contributions, of pledges, if there were any such 
discussions ? 

Dr. Meiirex. That is correct. 

Mr. Weitz. Now, turning to 1971, I take it that you had some in- 
volvement in assisting AMPI and the other cooperatives in an effort 
to obtain a price-support increase for the 1971-72 marketing year. 

Dr. Meiiren. That is correct, sir. 

Mr. Weitz. Could you tell us what role you played in that effort? 

Dr. Meiiren. Yes. The first role I played was again to eclit the sub- 
mission that was made to the Secretary of Agriculture, which I think 
we have given to you. That was a rather comprehensive activity, be- 
cause as I recall when it came to me, it wasn't in very good shape. 

The basic purpose was to put it into a form which would be rele- 
vant to the factors required to be considered by the Secretary in setting 
a price-support level. 

The second was to work primarily with Mr. Mills, and assuring the 
dissemination of this kind of information to other Membere of the 
Congress. 

Mr. Weitz. Now, was there a letterwriting campaign that was in- 
stituted that you were aware of ? 

Dr. Meiirex. Yes, I was aware of tlie letterwriting campaign. 

Mr. Weitz. The letterwriting campaign was both to the Depart- 
ment of Agriculture and to various Members of Congress? 

Dr. Meiirex. I believe to the Executive, also. 

Mr. Weitz. You say to the "Executive." 

Dr. INIeiirex. The President's Office at the Wliite House. 

Mr. Weitz. I see. And there was also a visitation program of con- 
stituents to various Members of Congress? 

Dr. Mehren. a rather large-scale one. 



0-337 O - 74 - Bk. 16 



7234 

Mr. Weitz. Were you also aware of meetings taking place both 
at the staff level, and with the top officials of tlie Department of Agri- 
culture during that period, in connection with obtaining the increase ? 

Dr. Mehren, To the best of my knowledge, I never participated in 
those, I am not certain whether I was aware of them calling upon 
such people as Dr. Hardin, the Secretary ; I'm not certain, but I expect 
I was. It's not firm here, but I believe I was. 

I should add to that. I am not at all certain that they ever went 
over to the Department of Agriculture. I think I heard them say so, 
but I have no certainty. 

Mr. Weitz. You think it's likely if we have independent evidence of 
meetings with a number of people in the normal course. 

We are talking about a certain period now. Would this period have 
begun as early as 1971, January 1971, with a view to extending the 
effort up to the time, some time in March, when the price-support level 
would be set ? 

Dr. Meiirex. I think it Avould have been later than January 1, Mr. 
Weitz. I know — not with certainty, but I'm reasonabl}^ certain — that 
at least two or three times from the 1st of March to the 23d of ^Nlarch. 
I came down here to help these peo])le with their formulations. 

I would guess probably it would have been in February that the 
submissions were made to me; and probably that would have been 
done in New York, but I'm not certain. 

Mr. Weitz. When was the general time in March that you expected 
the decision to be publicly announced ? 

Dr. Metiren". There is a certain time limit on this matter. The 
market year begins on April 1 ; prior to that, the Secretai-y must 
provide notice in the Federal Register. But generally, March 20 would 
be about the last time, March 20 to 25, that a price-support docket 
would be issued; and therefore it would be generally between the 1st 
of March and perhaps the 25th of March, as a routine matter over the 
years, that the dairy price-support level would necessarily be an- 
nounced. 

Mr. Weitz. In these contacts, both on the Hill and the submission 
that you prepared, for whatever purpose they were ultimately used, 
did that address itself to all phases, all economic aspects of the 
problem? 

Dr. Meiirex. Yes. You have that memorandum. I think. 

Mr. Weitz. And did it also, for example, refer to the impact of 
increasing costs to farmers upon production, and their capacity to 
remain in business ? 

Dr. Meiirex. Well, to be helpful I have just told our economics peo- 
ple what to write for the submission on price support this very year; 
and generally there is a standard procedure. 

One is to specify the nine governing standards to which the Secretary 
must refer in setting the price support. 

The second step is to set the facts that are relevant to each of those 
standards out as precisely as one can. 

The third, then, is to derive conclusions that would be derivable from 
the placing of the facts against the standards. 

Nearly always one then takes whatever special issues may be in- 
volved. This year it would be a matter of imports; it would also be a 
matter of relative prices for dairy products. Then one goes into what 



7235 

might be called a traditional counterargument, Mr. Weitz, and that 
nearly always is what tlie Secretary must look at ; and the consequence 
of once having been through that "oneself, one knows reasonably well 
what the Secretary must have. As I recall, that is how I organized 
for that submission, tlie documents that went in to the Secretary, and 
up to the Members of Congress in 1971. 

Mr. Weitz. All right. Let me take about a 2-minute recess to get an 
exliibit which I thought I had brought, and which I would like to 
show 3^ou. 

[A short recess was taken.] 

Mr. Wettz. Back on the record. 

Dr. Mehren, I am showing you Townsend exhibit 3*, I believe, to 
his executive session before this committee ; and I want to ask you 
whether you recognize that as one of the submissions, or the prin- 
cipal submission of the cooperatives in 1971, with respect to the price- 
support question. 

Dr. Meiirex. I believe it is, sir. 

]\Ir. Weitz. Now, I want to direct your attention to pages, principally 
9 through 11, where tliere is some written material and charts referring 
to increased costs to farmers. Is that some fairly complete and rele- 
vant data, available at that time, as to the question of increased costs, 
including increased feed costs to farmers ? 

Dr. Meitren. Well, apparently the materials on page 9 come from 
Anthony Mathis, who I know to be the official in the Department of 
Agriculture, who at that time was responsible for determining such 
costs from the data. 

Similarly, the material I see on page 10, exhibit D, these reports 
come from "Dairy Situation," and therefore, could be expected to be 
replication of official data from departmental publications. 

If I may take a moment to skim page 10, please ? 

Mr. Weitz. Certainly. 

Dr. Meiiren. I think. ]Nfr. Weitz, the materials on pages 9, 10, and 
11 appear to be accurate and basically from official sources. 

Mr. Weitz. All right. Now, you notice the date on the document is 
February 24, 1971. I think you said you were in Washington several 
times in March of 1971 in connection with this matter. 

Dr. Mehren. Either two, or three times between the 1st and the 
23d. 

Mr. Weitz. You left Washington on the 23d, and did not return be- 
fore the decision was announced with respect to })rice support? 

Dr. Mehren. Thafs correct. 

Mr. Weitz. In fact, you went to Europe and left the country. 

Dr. Mehren. Yes. 

Mv. Weitz. Now, until the time of the 23d, was there any informa- 
tion that you became aware of, economic data, with respect to price 
support, the price-support question, that was new, or shed further 
light on the question of increased costs, subsequent to this document 
dated Februaiy 24 ? 

Dr. Mehren. I have already testified. I believe, before Bill Dobro- 
vir, that I had no such information ; and I still don't have any. 

Mr. Weitz. All right. 



»SeeBookl4, p. 6332. 



7236 

Dr. Mehren. What you are really asking me, was there any change 
in the basic economic structure, or any basic change in number or 
analyses that would lead to a different conclusion from the number 
set here. Is that what you are asking me? 

Mr. Weitz. That is the. relevant question. 

Dr. Mehren. I don't know of any. But, I would also say that the 
numbers here, considering the nature of the standards that govern 
secretaries do provide latitude for any secretarial offices to make alter- 
native decisions. 

Mr. Weitz. And I understand to the best of your knowledge these 
submissions were made available to people in the Department of Agri- 
culture, or whoever the dairy people were meeting with during that 
period ? 

Dr. Mehren. I can't, of my personal knowledge, say they went to 
the Department of Agriculture, because quite meticulously I stayed 
out of the Department of Agriculture for some 2 years after I left the 
office; but I think that others did take them there. I do know that these 
are made generally available to quite a few ])eople in the Congress. 

Mr. Weffz. Now, in Maich of 1971 — February-Marcli of 1971, were 
you aware which lawyers in Washington were representing AMPI in 
assisting them in their efforts in coimection with the price-support 
matter? 

Dr. Meiirex. I don't think I can truthfully say that I knew at that 
stage of all of the lawyers who were apparently, or nominally, at least, 
associated with AMPI ; I knew some. I knew that DeVier Pierson was 
associated with it because DeVier Pierson actually helped in the 
drafting of some documentation. 

I knew that Jacobsen was involved because I saw him on one or two 
occasions during this period; and I knew that Marion Harrison was 
involved. But I don't think I could say that — well, yes. 

Mr. Weitz. Is Ted van Dy k a 1 a^vy er ? 

Dr. Meiirex. He was a consultant. I know lie was involved; I know 
Bill Connell was involved. 

Mr. Weitz. Did you have occasion to meet in March of 1971 with 
Mr. Harrison and others from AMPI ? 

Dr. Mettrex. I was at the meeting on March 23d, I think, for about 
a half hour in duration, prior to the movement of the delegation over 
to the "Wliite House. 

Mr. Weitz. You did not attend the meeting at the "^^Hiite House, 
however ? 

Dr. Meiirex. No, I did not. 

Mr. Weitz. Other than that meeting, was there any other meeting 
that you can recall with Mr. Harrison and others from AMPI in 
March of 1071, that you attended ? 

Dr. Meiirex^ I have a vague recollection. Mr. Weitz. 

Mr. Weitz. How about Jake Jacobsen, did you meet witli him dur- 
ing that period? 

Dr. Meiirex-. I have a somewhat less vague recollection that on one 
or two occasions Jake Jacobsen was in the so-called headquarters 
room in the Madison Hotel. 

Mr. Weitz. And you were aware that both Mr. Harrison and Mr. 
Jacobsen were assisting AMPI, advising them, and so forth, in re- 
spect to obtaining a price-support increase ? 



7237 

Dr. Mehren. I was, sir, 

Mr. Weitz. Do you know who Mr. Harrison was meeting with in 
the administration on behalf of AMPI ? 

Dr. Mehren. Not with any precise recollection. I believe he did 
say he had contact with Clifford Hardin ; whether he met with him 
I cannot truthfully say. I think he alluded once or twice to contact 
with White House staff, but I cannot say which ones. 

Mr. Weitz. All right. 

Dr. Mehren. But there was a general tone — you want me to be 
helpful — ^there was a general tone that he did know, generally speak- 
ing, the staff around the President's office. But, I don't recall any 
case where he said, "I saw Mr. so-and-so," or "Mr. so-and-so." I did 
not participate in that part of the activity at all. 

Mr. Weitz. Did you meet with, or know of any meetings taking 
place with Murray Chotiner in March of 1971, in connection with the 
price-support matter ? 

Dr. Mehren. I have never met with Mr. Chotiner. Ex post I did 
learn of meetings, and well ex post, but not at the time. This part 
was not made known to me at all. Long, long afterward I can recall 
Harold Nelson saying something to this effect: "That of all of the 
people on the A^Hiite House staff, the one that could really make the 
ball move was Mr. Chotiner." I think other records will show I 
have never met Mr. Chotiner; in fact, I have never even seen him. 
But those were ex post conclusions, Mr. Weitz. 

Mr. Weitz. I take it then, you were not aware that Mr. Chotiner 
was, in the last part of March 1971, house counsel for the Harrison 
firm? 

Dr. Mehren. That I learned ex post, and I think I can tell you 
wlien I learned this. Shortly after the change of management Mr. 
Harrison came to my home and spent a night, I believe, or two. At 
that time he did tell me that shortly after the detachment of Mr. 
Chotiner from the White House position, that he had become a 
counsel. 

And for the record, T volunteer that he also told me at that stage, 
that the 7-etainer from AMPI had at that time been raised. 

Mr. Weitz. More tlian doubled, hadn't it? 

Dr. Meifken. The number that comes to my head is $57,500 — and 
please don't liold me to the accuracy of this later. 

I think lie said, as I recall the conversation, that the retainer had in- 
creased $50,000 per year; and $7,500 was contributed toward equip- 
ment, furnishings, et cetera, for Mr. Chotiner. I believe that is what he 
told me. 

Mr. Weitz. W\\en Mr. Nelson talked to you, I believe somewhat after 
the fact, that Mr. Chotiner was a prime mover, or 

Dr. Mehren. "Most effective," generally, to give you his exact words. 

Mr. Weitz. Was he talking with reference to the price-support 
question ? 

Dr. Mehren. I think so. 

Mr. Weitz. Did he give you any further specifics as to Mr. Chotiner's 
role in tlie price-support effort ? 

Dr. Mehren. Well, it is veiy difficult for me now to recall with any 
specificity what he said, but I will give you the general tone, and my 
general recollection of it was to the effect that the one person who could 



7238 

make effective representation witliin the staff areas of the White 
House, and I presume therefore, into the Secretary of Agriculture's 
office, was Mr. Chotiner. 

He seemed to feel that he was the one who could make the effective 
presentation and persuade people to do what Mr. Nelson wanted done. 
This is the tone of his statement to me. 

Mr. Weitz. How long after March of 1971 did you have this dis- 
cussion with Mr. Nelson ? 

Dr. Mehren. That would be awfully difficult to say, I am not slight- 
ing you— I believe it would have been well into the summer of 1971. 

Mr. Weitz. While Mr. Nelson was 

Dr. Meiiren. While Mr. Nelson was still manager, so, it was prior 
to January of 1972. I am reasonably certain it would be well into the 
summer because I have no recollection of any discussions with him — 
that's a rather puzzling thing — or anybody else with respect to the 
price-support activity. I learned of it from the attache at the American 
Embassy at Bonn. 

Mr. Weitz. In what context was the reference to Chotiner made, how 
did the matter come up ? 

Dr. Meiiren. That would be difficult to recall. I believe it was in a 
general discussion of procedures in effectuating executive decisions in 
Washington; it was at this time when he made rather complimentary 
statements about Mr. Chotiner. 

I think in fairness, and in accuracy, there was no direct or indirect 
implication that any payments had been made, or of any improper, un- 
lawful activities. 

Mr. Weitz. Did he make any other references, or is there anything 
else about the conversation, relative to this matter, that you recall ? 

Dr. Meiiren. By this question you are asking me, did he refer to 
other individuals? 

Mr. Weitz. Either that, or expand in any way on the price-support 
matter ? 

Dr. Mehren. I think he said two other people were, in his judg- 
ment, rather key individuals in the Wliite House staff in terms of 
influence on ultimate decisionmaking. There is another man whom 
I don't know; I believe he referred to Harry Dent at one stage. He 
generally said something to the effect that here is a man to whom 
you can talk, he understands what you are saying; and broadly 
speaking, at least in tone, or basic conclusion from his statements, 
"Here is a man who gets things done." 

Mr. Weitz. Did he indicate he had met with him in connection 
with the price-support matter? 

Dr. Meiiren. I don't recall if he did so. 

Mr. Weitz. Who else did he refer to? 

Dr. Mehren. Mr. Colson. 

Mr. Weitz. What did he say with reference to Mr. Colson? 

Dr. Meiiren. As I recall now — and again, that is a totally fresh 
recollection here— as I recall he said that Colson was a higldy orga- 
nized, systematic worker who quickly understood what was being said 
to him; and seemed to be the kind of man who could function on an 
executive basis, and get the opinions of the representations made by 
such people as Mr. Nelson, to wherever they go for decisionmaking 
purposes. 



7239 

Mr. Weitz. Ncav, from the comments of Mr. Nelson with respect 
to Mr. Chotmer and Mr. Colson, Avas it your understanding, or im- 
pression, that Mr. Nclsoji was speaking from firsthand knowledge 
acquaintance Avith th(\se individuals? 

Dr. Metiren. I tliink I can say this properly — I am trying to be 
fair as well as accurate — I think I can say this properly with respect 
to IVfr. Chotiner. I certainly got the impression that he knew Mv. 
Chotiner and had talked Avitli Ah\ Chotiner. 

Mr. Weitz. How about Mv. Dent? 

Dr. Meiiren. I think so, but I really can't say that in a definitive 
sense; but I think so. 

Mr. Wefpz. And Mr. Colson ? 

Dr. Meiiren. To a lesser extent. I would find it very difficult to 
conclude that with references to the eifectiveness and capacity of 
these people to function, one could not conclude that he had some 
contact with tliem, because otherwise it would be rather difficult for 
him to make such appraisals. Tliat is the only basis on Avhich I can 
conclude he had talked to tliem ; he never told me this. 

Mr. Weitz. Now, in your meetings with Mr. Jacobsen, did he make 
any reference to Mr. Connally? 

iDr. Meiiren. I think so. I am not sure — I think so. 

Mr. Weitz. Were you aware in March of 1971, of Avhat I think I 
may safely refer to as a longstanding friendship and acquaintance 
between Mr. Jacobsen and Mr. Connally? 

Dr. Meiiren. Only in terms of one-sided purported relationship. 
I might say, without ever directly saying so, it Avas my impression 
from the year or tAvo earlier that I had become acquainted Avith Mr. 
Jacobsen that he Avas closely related on a personal basis Avith Mr. 
Connally. 

Mr. Weitz. Were you ever present at any strategy meetings, or any 
other types of meetings in March 1971, Avith the dairy people, in Avhich 
conversations coA^ered such matters as contacts in the White House, 
and alternative contacts Avith other Cabinet, or other high officials 
in the administration? 

Dr. INTeiiren. I think so; I don't haA^e any specific recollection. 
Again, for the record purposes, the procedure that Avas generally fol- 
loAved by Mr. Nelson, as I presume others have told you, was kind of a 
segmented distribution of information. There Avere sessions in which 
T knoAv T sat, on occasion, in the INIadison Hotel m Mr. Nelson's suite, 
in Avhich there Avas kind of an evaluating Avhat they had done one day ; 
sort of a strategic projection Avhat might well be done the other. 

I think — but again, it's not a precise recollection — that I haxe. he-ard 
IMr. Jacobsen say that INfr. Connallv probably would be willing, given 
the appropriate facts and bases for action, to make representation 
to help in the matter. But this, ajjain, is not a precise recollection. 

So. I think that vou probably understand that neither then nor 
noAv do I — nor could I — orient my activities in long and difficult days 
Avhere these ix)litical mattei^s Avere 

Mr. Weitz. Without respect to particular words, or pinpointing 
particular meanings, this Avas a major effort in AA^hich you Avere pres- 
ent tAvo or three times in Washington in March of 1971. 

Dr. Meiiren. Yes. 



7240 

Mr. Weitz. And you, being astute and intelligent, can you recall 
being aware, or in fact being involved in decisions with respect to 
how best to procure the increase, whether through the administra- 
tion, or otherwise ? 

Dr. Meiiren. My activity, really, I think — ^going back, came down 
to two major sets of functions, Mr. Weitz. One was argimientation, 
or the supporting documents, to use the bureaucratic language 
here 

Mr. Weitz. The economic data ? 

Dr. Meiiren. Yes ; in a price-supported docket, above and beyond all 
other things, the economic data are also appraised in terms of politi- 
cal consideration; and has been, to my knowledge, in all adminis- 
trations. That was one. 

The other one was as a sort of a collaborator with Mr. Mills in terms 
of appraising the progress of the bills in the House, and to a lesser 
extent in the Senate. 

But there is very little in the sense of working the Hill as a depart- 
mental liaison officer regularlv worked the Hill. No, I had none of 
that. 

As I recall it, I think I testified earlier, that during this period I 
may have talked with four or five people; but they are just the 
four or five people I hapjien to know well in Congress. 

]\Ir. Weitz. Now, on ]March 23, 1971, when you left Washington, 
was there optimism among the dairy people with respect to an in- 
crease by the administration of the price-support level ? 

Dr. Meiiren. It's a difficult thing. As I recall, I rather thought — 
this is ex post of what all of them have told me since, I don't think 
I saw them ; T packed up and went to New York. 

Mr. Heinixger. Your question is directed before 

IMr. Weitz. That's correct. From your knowledge when you left 
Washington, was it your feeling tliat it was probably, or there was a 
good possibility that there would be an increase in the price-support 
level by the administration ? 

Dr. Meiiren. I don't think so, and this is a difficult question to 
answer. I don't think so because as I recall it, they were reasonably 
well aware that wliile there was always much discussion, much clear- 
ance, occasional amendments or either a reversal of preliminary sub- 
missions from the Secretary's office to the White House. That to 
actually promulgate a finding and officially to send an order and then 
to reverse it would be a most uiuisual matter. 

I think they were aware of that, and certainly I was. To my knowl- 
edge that has not occurred before. Perhaps it has, but I don't know. 

I suppose the answer to your question would be that in view of the 
fact — what was the date on wliich the initial finding was made? 

Mr. Weitz. March 12, probably. 

Dr. Meiiren. My departure was March 23. A reasonable man would 
be required to assume that the likelihood of reversal would be remote. 

Mr. Weitz. And you Iiad known from your personal contacts and 
meetings, and so forth, durino- tlie pei-iod when you left, on March 23 
no basis to think otherwise, from wliat a reasonable man would con- 
clude? 

Dr. Meiiren. Only one basis, and that was that the number of Mem- 
bers of the House, and I guess of the Senate, who had endorsed or 



7241 

sponsored, as the case may be, bills setting a minimum floor to the 
price support, as they did this year, was impressive. 

This much I did think, that there was rather good likelihood of pass- 
ing a bill which would change the minimum from 75 percent parity, to 
whatever the level was being sought by the group. But beyond that, I 
think your question really goes to the point, is it a typical matter, or 
would it frequently occur that the Secretary, probably with the 
acquiescence of the White House had made a finding, and then it 
would be reversed shortly afterwards. I quite agree, that would be a 
most unusual matter, and it has never occurred in my personal expe- 
rience. 

Mr. Weitz. Before the time you left, did you have any knowledge or 
infonnation of any political contributions that were made, or were 
being made, or being contemplated, I should say ; that were made, or 
being contemplated by any of the dairy trusts, or dairy cooperatives 

to the Eepublican 

Dr. Mehrex. I cannot recollect any such discussions whatever. I 
think, and this is a backrvvar-d judgment, that had anyone come to me 
and said that lawfully and properly in the period of seeking a price- 
support level, or in the period seeking an amendment, or a reversal of 
the price-support level, you should also be contributing political funds 
I would say, "This is not merely indiscreet, but this is perhaps lawful, 
but stupid.-' 

I don't think so. The memory I have of the association, attempt of 
the association at least, of political contributions in 1971, and price- 
support amendment in 1971 was substantially later, and basically 
through the press. I don't recall when that first became public. 

Mr. Weitz. All right. Now, when you returned 

Dr. Mehrex. Also, to answer this — and if I become too discursive 
you tell me — I think it was when the association, or at least the tem- 
poral sequence of political contributions, amendment of a price sup- 
port, and apparently further political contributions became public, 
Mr. Nelson made the remarks, or statements with respect to who had 
been useful, and who had not. I think it was in association with the 
publication of these facts that this discussion with Nelson occurred. 

Mr. Weitz. I see. But, in light of the segmentation — if that is the 
]:)roper word — the propensity of Mr. Nelson to segment functions and 
knowledge of activity in the organization, was it surprising to you 
that you were not told of any such contributions, or contemplations, if 
they were in fact made ? 

Dr. Mehrex. No, it isn't really. I think that Mr. Nelson looks upon 
me as what might be called virtuous; he looked upon me as a person 
with a professorial background and academic reputation. I can't recall 
any time at which he discussed these kinds of things with me. 

Mr. Weitz. Did there come a time in May 1971, when you met with 
certain officials in the Department of Agriculture, specifically Assist- 
ant Secretaries Lyng and Palmby ? 

Dr. Mehrex. There came a time, I think, when I met — I think prior 
to that, Mr. Weitz — with Mr. Lyng, Don Paarlberg, and there rnay 
have been others; AVhich was antecedent, I'm pretty sure, to the meeting 
with Dick Lyng and Don Paarlberg. 

Mr. Weitz. And at this prior meeting, this was after you returned, 
it would be sometime in April or May of 1971 ? 



7242 

Dr. Meiiren. I can't be certain of the sequence, but I believe I met 
in a rather heated session one afternoon with Richard Lyng, an old 
friend and colleague. Don Paarlberg was Director of Agricultural 
Economics, another old academic colleague. I think it was prior to 
my meeting with Dick Lyng and Clarence Palmby, I'm not certain. 

Mr. Weitz. And at that meeting, was the matter of price support 
of the previous March discussed ? 

Dr. Mehren. At the meeting with Don Paarlberg and Richard 
Lyng, I don't think it was so much the price support as it was a gen- 
eral implication that ""your people are playing too rough", something 
of that sort. 

Mr. Weitz. What was he referring to, do you know ; did you know 
at the time ? 

Dr. Mehren. Yes, not specifically. I think what he was referring to 
was what later became the issue of the Oklahoma metropolitan order 
area difficulty — I think that's what it was. 
Mr. Weitz. Nothing to do with price-support level. 
Dr. Mehren. I don't recall it as such. 

Mr. "Weitz. Was there any mention or reference, directly or indi- 
rectly to political influence ? 

Dr. Mehren. You are talking now of the meeting with Don Paarl- 
berg and Dick Lyng, which I think was the first meeting, I'm not 
certain of it. I don't recall that as being a thrust of the meeting. 

Mr. Weitz. Novt^, your subsequent meeting with Assistant Secre- 
taries Lyng and Paarlberg — did you discuss the question of price- 
support matter ? 

Dr. Mehren. There is a memorandum, I think, which has been 
made available to you; in which I advised Nelson basically what 
this discussion was. 

Mr. Weitz. Let me show you this memorandum that I believe you 
are referring to, exhibit 15* to the Nelson executive session. It is a 
memorandum to Mr. Nelson from you, dated May 19, 1971. I believe 
you have been shown this before. 
Dr. Mehren. Yes, I have. 

Mr. Weitz. I want to direct your attention to two paragraphs, 
paragraph 4 and a portion of the second paragraph, item No. 15 — 
let's iDegin with No. 4. 
Dr. Mehren. Yes. 

Mr. Weitz. There is a reference there to the fact that Mr. Lyng 
and Mr. Palmby are upset about the boasting and bragging with 
respect to the reversal to the price-support matter. Do you know what 
this is referring to ? 

Dr. Mehren. Really, I don't think this one came so much from 
Dick Lyng and Clarence Palmby as it did from the Secretary. 
Mr. Weitz. Secretary Hardin ? 

Dr. Mehren. As I recall it, when I finished this discussion here, 
which had in fact been generated, if I recall, by invitation from 
Dick Lyng; I walked downstairs and met Clifford Hardin, who also 
was an old academic colleague of many years on the apron of the 
administration building. 

I really think it was the Secretary who said something to the effect 
that the reversal, or the amendment had occurred, and that he regarded 

*See Book 15, p. 6750. 



7243 

the amendment of the Secretary's decision by the President as one of 
the occurrences that is associated with being a Secretary; but, that 
he did not like, as he put it, our people boasting, or bragging. 

I asked him, as I recall, who was doing it, and he said, "Well, it's 
various personnel out there in your field, the field people." 

I responded, as I recall, to Dr. Hardin to the effect that when I 
was in the Department it was frequently quite impossible to prevent 
such activities, or such statements from our own field personnel ; and 
that to my knowledge there had never been any central discussion 
of this sort; and there hadii't. But that I would do everything I 
could to terminate it. 

Mr. Weitz. Now, in a previous interview with members of this 
staff, I believe with respect to that conversation with Dr. Hardin in 
May of 1971 — at least our understanding of your previous interview — 
was that you said that Dr. Hardin had made a point of telling you 
that he had changed his own mind with respect to the price-support 
matter. 

Dr. Mehren. Yes. 

Mr. Weitz. Now, in your statement that you just made, I think you 
made a reference to the fact that Dr. Hardin was referring to a decision 
by the President. Can you clarify, or 

Dr. Mei iREN. No, no. 

Mr. Weitz. Can you clarify, or amplify on what Dr. Hardin told 
you on that occasion ? 

Dr. Meiikex. I think I can clarify it out of my own experience. I 
really don't know of any important price-support decision that doesn't 
almost routinely go over to the Wliite House. It may be occasionally 
on honey, or tung nuts, or some very minor thing that the Secretary 
is given total latitude, although I have seen it go on honey more than 
once to the White House. 

In the i)rogress quite frequently, from my own experience, the 
original submission of the Secretary has been amended. The difference 
has been that it was never made as a finding, and published, and then 
amended. 

Mr. Weitz. My question is specifically this: Did Dr. Hardin make a 
statement to you as to whether or not the March 25 decision was his 
own decision, or the President's decision ? 

Dr. Meiiren. I believe he made it as his own decision ; and tech- 
nically speaking it was his own decision. 

]Mr.'WEiTz. What did he tell you about it, though ? 

Dr. Mehren. As I recall he' said something to this effect — and this 
is again most difficult — as I recall he said something to the effect that — 

I did make the amendment, and I published it, and it's done. But now I don't 
want people saying I was pushed, or forced. 

Mr. Weitz. That was it ? 

Dr. Mehren. Yes, that's basically it, what was discussed— his saying : 

I don't like your boasting and bragging, and saying we made you do it. 

That was the thrust of his statement to me. 

Mr. Weitz. Did he make any reference to the fact that the President 
had ordered him to do it ? 
Dr. Meiiren. None. 
Mr. Weitz. Did he give you the contrary impression ? 



7244 

Dr. Mehren. He really said that he made the amendment, and he so 
published it in the Federal Register. Basically, what he said to me was 
in the Federal Register, on tlie new data respecting costs, as 1 recall. 

Mr. Weitz. From your experience in February-March of 1971 in 
connection with the submission that was prepared for relevant individ- 
uals, I believe you testified here that you were aware of no such new 
data that was available. 

Dr. Meiiren. There may have been new data, but I will say this, I 
would be very surprised if any totally compelling data on costs would 
have been discovered, or would have been analyzed to reach con- 
clusions different from the first one. 

But, I must also say again, as I said during your short recess, that 
out of my own prior experience the governing standards of that 
statute are such that they can — with agreed sets of facts, there is 
latitude for secretarial or Presidential decision. 

You see, you cannot take the facts of output, price, cost, re\onue, 
treasury cost, acquisitions, im])orts, et cetera, and come out with a 
unique single determinate finding. So, there is always latitude for 
revision. 

Mr. Weitz. Now, in 1971, did you have any knowledge of any con- 
tributions by AMPI, or any of the cooperatives, or their political trust 
to the President's reelection effort? 

Dr. Meiiren. Prior to the price-support matter ? 

Mr. Weitz. No ; at any time in 1971. 

Dr. Meiiren. I think so — I think so. 

Mr. Weitz. Would your knowledge have come through Mr. Nelson, 
or through TAPE reports? From what source? 

Dr. Meiiren. I think, and that has to be the best of my recollection, 
it came whenever the Nader matter started; and the press began to 
note what they considered a remarkable interrelationship of temporal 
sequence between submission of data, a price-support finding, political 
contributions, the price-support amendment, and political contribu- 
tions. 

Let me say again, T do not recall any of them, either in Government, 
or out of Government, referring to political contributions prior, I 
think, to the public kjiowledcre of that. 

Mr. Weitz. Now, the public knowledge would be some articles on 
that sequence of events: it was published as earlv as September of 
1971, the beginning of 1971. 

Now, beginning in September of 1971 until you became general 
manager in January 1972, did you have occasion to discuss this mat- 
ter with anyone in AMPI ? 

Dr. Mehren. Well, I have alreadv stated that I discussed it at least 
once with Harold Nelson. I know his answer, at least in a general 

Mr. Weitz. IVliat was his answer ? 

Dr. Meiiren. This is the thrust, at least in tone or conclusion, these 
aren't the words he used, that people just don't go around doing things 
like this. Professionally competent people don't go in and associate 
political contributions with administi-ative decisions because that's 
not the way things are done. From my earlier experience, that state- 
ment was correct. 

Mr. Weitz. Now, directing your attention to 1972 

Dr. Mehren. You have 15, that you wanted me to look at. 



7245 

Mr. Weitz. I think we covered that. Both matters essentially cover 
the same topic. 

Before we leave that, before we leave 1971, I have here an exliibit 
to one of your depositions. 

It is a report of the general manager, AMPI to the board of direc- 
tors, dated December 1, 1971. Now, on page 14 of that re]:)ort it states 
as follows, the paragraph reads as follows: "^V^^iat we have done has 
been worth the doing," that refers to the TAPE program. "Adjust- 
ments in price supports were worth at least $300 million in income 
to dairy farmers." 

I have two questions: First of all is that, to your knowledge, a fair 
estimate of the impact of the price-support increase on dairy farmers ? 

Dr. Meiiren. No. 

Mr. Weitz. Didn't you write this report ? 

Dr. Mekren. I helped write it, but Iin not sure I put that number 
in; no. 

Mr. Weitz. Did you have a chance to review this before it was dis- 
tributed ? 

Dr. Mehren. Yes. I wrote parts of it, I am not sure which, the parts 
that I actually drafted. I am cei'tain I read the whole thing; but as of 
now T am quite certain that number is at least twice as high as it 
should be. 

Mr. Weitz. When you say "as of now," what about at the time in 
1971 when the decision was made; was it a fair estimate? 

Dr. Meiirex, Yes, I suspect it probably would have been a fair 
estimate then, because no one was aware that the market price by 
December of 1971, certainly by January 1971, would have exceeded 
tlie support level. 

Mr. Weitz. January of 1972. 

Dr. Meiirex. 1972, yes. I think the way this was done, that they 
projected on the basis of the fii-st quarter of the marketing year the 
acquisitions and outlays by the Federal Government that would be 
associated with them. But in the meantime, by December of 1971, as 
I recall, late December of 1971, the market price had exceeded the sup- 
port price. There were virtually no acquisitions, and no governmental 
additions to incomes in the last part of the marketing year. 

The number that I had worked out — I asked that question of Elrod 
and Miller, who are economists down there, and they come out with 
about $124 million as the maximum. 

Mr. Weitz. As you say, tliat is concluded with hindsight. 

Dr. Meiiren. Yes. 

Mr. Weitz. Subsequent data. 

Dr. Meiiren. Yes. 

Mr. Weitz. Now, turning your attention to 1972. You became 
general manager on January 12 of that year; is that correct? 

Dr. Meiiren. Yes. 

INfr. Weitz. Now, I believe you testified — probably a number of 
times — that when you became general manager, and I think you 
repeated it again today, that you made an etfort to determine from 
those prior management people, and current management people, exist- 
ing commitments and responsibilities of the cooperative. Is that 
correct? 



7246 

Dr. Mehren. Yes. I believe the order was written on February 3, 
as I recall. I believe I wrote a memorandum saying I wanted our people 
to let me know what commitments and contracts, and so on, were out- 
standing, good, or bad. 

Mr. Weitz. Now. did you have an occasion to discuss with anyone 
what outstanding jjolitical connnitments, if any, then existed ? 

Dr. Mehren. I liad the one si>ecific discussion with David L. Parr 
to which I referred earlier. I tliink I asked Nelson, and I think I asked 
everybody else if we had such political commitments; the only one 
that I ever was given, as I recall it, was the $2.6 million, nominally 
from articles; tliat is not a money commitment. 

Mr. Hetninger. He doesn't believe that. 

Dr. Meiirex. There were two commitments that I know about, they 
are in the record, in that not only Nelson, but other participants of that 
March 23 meeting told me that tliey did make two agreements with the 
President. At least they said sometliing to that effect, if the price sup- 
port was put at the level tliey wanted it, which I vaguely remember 
was $4.93, as opposed to $4.66, (a) they would undertake to comply 
with the President's apparent request tliat they control production, 
and not load the Government up with stocks; and (b) that they would 
not intervene or ask a price support in 1972. Now. that commitment I 
did keep because I asked Nelson bluntly if those two commitments 
had been made, and he answered quite bluntly "Yes"; and therefore 1 
did not, or AMPI did not participate in representation for price-sup- 
port adjustment in 1972. 

Mr. Weitz. To your knowledge, did the other cooperatives ? 

Dr. Mehrex. Yes. I am quite certain they did. 

Mr. Weitz. They did seek it ? 

Dr. Mehren. Yes, they did. 

Mr. Weitz. What caused you to ask Mr. Nelson whether these com- 
mitments had been made ? 

Dr. Mehren. I don't think I asked him whether those two commit- 
ments had been made because it would have been quite impossible, not 
having participated in a meeting of this sort, to ask two questions like 
that, I am quite certain that certain producer people who participated 
in that meeting, perhaps Nelson himself in telling me what the Presi- 
dent had said, let me know that these two quasi-commitments, at any 
rate, had been discussed. 

Mr. Weitz. Now, with respect to political commitments, or commit- 
ments with respect to political contributions, did you ask him of any 
of such commitments, and did he inform you of any such commit- 
ments ? 

Dr. Mehren. This much I can say to you, and again, for the record, I 
would like to have you personally, as well as professionally under- 
stand this: I do not. as a general matter, falsify myself on anything, 
nor have I, nor shall I. 

Second, I see nothing wrong with a commitment ; and if thev had told 
me they had a commitment, I would tell you they had told me so. 
There were other commitments of rather dubious nature that I was 
told about ; some of which I kept, and some of which I didn't. 

But again, I can tell you that I cannot recall any instance in which 
any of them said anything to the effect that they had made an agree- 



7247 

ment, with or without quid pro quo to participate in the financing of 
Mr. Nixon's 197'2 campaign. 

Mr. WErrz. Now, you say comniitnient, agreement ; T am asking you 
whether tliey told you of any discussions, or representations that in- 
volved a discussion of contributions to the Republican Party, or to 
President Nixon's reelection. 

Dr. Mehrkx. I don't think so. 

iNIi'. "Weitz. All right. Now on page 144 of the December 19 execu- 
tive session when Mr. Nelson was l)efore this committee, he was asked 
the following: "In your conversation with Dr. Mehren, either before 
the first meeting in January, or between the first and second meeting 
with Mr. Kalmbach, did he ask you whether any commitments had 
been made for political contributions?" 

Mr. Nelson's response is: "I think he asked me what we were com- 
mitted to do." And then he said, "I asked him what he told yon," and 
he said, "What we had told him"; and I said "what did you tell him?" 
and Mr. Nelson's resj^onse on i)age 145 is : "T told him the same thing 
I told everyone else, it was indicated that we would make large con- 
tributions and had been unable to get the committees." 

Dr. Mehren. Now 

Mr. Weitz. Wait a second, further down I asked him: "Did you 
indicate that these intentions or commitments, however you want to 
characterize them, had been fully satisfied?" And Mr. Nelson's re- 
sponse was, "No, I told him they had not been." Do you recall any 
such conversation ? 

Dr. Mehren. No, no. And again, now, I have no personal or profes- 
sional reservation in telling you if there was such a commitment. 

The only thing I know of is the reference by INIarion Harrison to 
the difficulty of meeting commitments; but that, I think, was 1971, in 
getting committees put together, l^ut I do not have any recollection— 
in fact, I have adverse recollections of Nelson and Jacobsen ever tell- 
ing me that they had made any agreement, specific, indirect, or other- 
wise, to contribute to the 1972 campaign. There would be no point in 
my telling you this unless it's so. 

Mr. Weitz. That would include any discussions, or representations 
without regards to agreements, or commitments? 

Dr. ]Meiiren. I think so. I don't have any recollection of it ; and if 
T did, I would give it to you quite without reserve. 

Mr. Weitz. And if you did, you would have a recollection of it. 

Dr. Meiiren. I think so. I can't answer yes, or no. 

Mr. Heininger. For the record, the document to which he referred 
was not discovered by us, and I am sure not seen by him until your 
sea rch through the fil e. 

Mr. Weitz. Are you aware that Mr. Parr has denied under oath 
even discussing the $2.6 million matter with you ? 

Dr. Mehren. I am now aware, that you ask me the question ; but I 
wasn't until this moment. The discussion was in the presence of an- 
other person. 

Mr. Weitz. Wiw was that ? 

Dr. Mehren. John Butterbrodt. 

Mr. Weitz. Did you talk with Mr. Butterbrodt about what com- 
mitments had been made, or what discussions, or representations with 
respect to contributions had bieen made? 



7248 

Dr. Mehren. Yes; I talked to liiin many times about it. 

Mr. WErrz. What did lie tell you t 

Dr. Mehren. He told me first that he knew nothing about the 
apparent commitments in 1971 ; that appeared to have been a dec ision 
made individually by Mr. Xelson, or by Mr. Nelson and a group, a 
group in which Mr. Butterbrodt did not participate. Mr. Butterbrodt 
and any of the other board people to whom I have talked said they have 
no knowledge of any agreements with quid i)ro quo, or bereft of quid 
pro quo, associated with earlier price adjustments, or also future price 
adjustments with respect to 1972. 

Mr. Weitz. When did this conversation take place with Mr. 
Butterbrodt? 

Dr. Mehren. Well, there have been many conversations with Mr. 
Butterbrodt. 

Mr. Weitz. "V^Hien was the first time that you discussed that with 
him? 

Dr. Mehren. Well, I suppose, and I will have to say this out of guess, 
rather than precise recollection, I suspect when the rumor about the 
$2.6 million with respect to David Parr came up, I asked John if he- 
knew anything about any of this, and his answer was, "No." 

Mr. Weitz. Now, on page 159 of your antitrust deposition, which 
is still underway, that particular questioning took place on December 
13, you were asked whether as new general manager you had asked 
management, prior management, of what the Republican Party and 
Mr. Kalmbach expected ; and your answer was, "No, I didn't ; I had no 
reason to believe there were any commitments of the sort we discussed 
this morning," and you went on to say that you didn't ask him about it. 

I take it from what you are saying that you, in fact, did ask Mr. 
Nelson. 

Dr. Mehren. I really asked Mr. Nelson and everybody else, as 
best as I could, what commitments of any sort there were, whether 
they were personal contracts, of which quite a few came up ; some of 
which were alleged to exist and never were found; business commit- 
ments, the works. 

But primarily, Mr. Weitz, in the context of saying, what are the 
areas, or the functions in which I can cut costs ; this was my overriding 
necessity in the first weeks. I wanted to know what was owed there. 

I will agree that political matters at that time, in that environment, 
considering the urgency of the other decisions I had to make, were 
of relatively minor importance. But, T think I asked them one by one, 
and I think Butterbrodt was certainly there the first 3 weeks of this 
set of inquiry, "What do we owe the people ?" 

You see, again, I had to go from approximately, as I recall it, 
something like $15 million of home-office cost, I had to get it down to 
about $6 million. 

Mr. Weitz. Yes; we will get to the si^ecific meetintrs in a minute; 
but you testified, and it is a matter of public record, at least sometime 
in early February of 1972, you did meet with Mr. Kalmbach for the 
purpose of discussing the general way of campaign contributions. At 
that meeting you were accompanied by Mr. Nelson and Mr. Jacobsen. 

Dr. Mehren. Yes. 

Mr. Weitz. Didn't you take that occasion, when you made a special 
trip from San Antonio to Los Angeles and back again, to at least dis- 



7249 

cuss with Mr. Nelson and Mr. Jacobsen what, if any, commitments or 
representations had previously been made ? 

Dr. Meiiren. No ; I didn't do it quite that way, as I recall it. I said 
somethings — what I did ask them was, "Are we under pressure, or 
are we under requirement ; and why are you people apparently in effect 
acting as intermediaries with Kalmbach?"; and the answer they gave 
me was, "We have to live with those people for another 4 years." 

But nothing more direct than that; and that statement I can 
remember quite explicitly in the airplane going out — incidentally a 
commercial plane, going out to Los Angeles. 

Mr. Weitz. Did he indicate there had been a $90,000 a month com- 
mitment made the previous year ? 

Dr. Mehren. I have never heard of a $90,000 a month commitment 
until it appeared in the press about 2 or 3 weeks ago. I am not sure now 
that there was any such commitment. 

Mr. Weitz. Did he tell you how much had been contributed in 1971 ? 

Dr. Mehren. I don't recall Nelson or anybody else telling me. I 
believe the press had discovered what had been contributed in 1971 
through TAPE. 

Mr. Weitz. Did you ask Mr. Nelson why that amount had been 
contributed ? 

Dr. Mehren. Probably not. It was contributed, it was done with. 

Mr. Weitz. With respect to meeting with Mr. Kalmbach 

Dr. Mehren. Yes. 

Mr. Weitz [continuing]. Did the matter come up as to, we con- 
tributed that amount, do they want more, or w^hy do they want mor©; 
or was the feeling, we should contribute more in order to live with 
them for another 4 years ? 

Dr. Mehren. Mr. Kalmbach went to great lengths, really, to make 
two points very clear to me in that discussion, which nearly all of the 
others always did. That there was no quid pro quo of any sort her^, 
Mr. Kalmbach, I believe, later testified under oath, to Bill Dobrovir 
that when he said he would not make further representations that thero 
would be no breach of commitments. 

It was not at the first meeting with him, I think, but the last one ; 
but the matter of commitments came up, and I do recall saying to him : 
"Now the abstention from any further representation, or seeking of 
funds here is not to be taken as a breach of any commitment," and 
he said "there was no commitment;" and he so testified. 

Mr. Weitz. Let's take those meetings 

Dr. Mehren. Let me just put this on the record. I can only tell you 
what was said. I cannot tell whether there was a commitment in the 
sense that you now say it. My own strong feeling now is, yes, there 
was ; and I said that to you in private conversations. 

But your question is: "Did they ever say this to me?" and the 
answer is, "No." 

Mr. Weitz. Now, I would like to take these meetings with Mr. Kalm- 
bach in sequence, so that we can perhaps bring out the specific matters 
with respect to each meeting. 

Dr. Mehren. Sure. 

Mr. Weitz. Were you told, either before or after January 14, 1972, 
a meeting was going to take place between Mr. Nelson, Mr. Jacobsen, 
and Mr. Kalmbach in California ? 



30-337 O - 74 - Bk. 17- 21 



7250 

Dr. Mehren. No. 

Mr. Weitz. Can you explain why Mr. Nelson in his executive session 
before us, on page 144, when asked about the meeting said that, "Mr. 
Jacobsen and I flew out in that jet and flew back, and then I reported 
to him" — meaning you — "about the meeting ?" 
Dr. Mehrex. Yes, I can. 
Mr. Weitz. All right. 

Dr. Mehren. "\Vlien I heard, or had adduced from the questioning 
of the grand jury that this meeting had occurred, quite truly, this was 
my fii-st knowledge of it. 

The next morning I reported to counsel. Mr. Heininger, that this 
information had been made known to me ; and it was as impressive to 
Mr. Heininger as it was to me. 

Immediately upon going back to San Antonio I asked the comp- 
troller to check the log of the company jet, to see whether it in fact had 
gone to Los Angeles. The log was last indicated on January the 12th of 
1972. The last logged flight of that jet was from San Antonio, to 
Mexico City, to Houston, to San Antonio on January 12. I therefore, 
as I think, told you on the telephone, and I certainly told Mv. Hein- 
inger that apparently the jet was not used. 

Then I heard, oh, a week ago from Mr. Heininger that Harold Nelson 
had said I gave him permission to use that jet, whereupon I told our 
people to go out and search for fuel records. Having searched for fuel 
records they found a fueling of the jet in Los Angeles on Januarv 14, 
I think. 

I said then, "search again" — they had been through expense ac- 
counts — and I said, "search them again to find out if we have any 
records of Nelson and the pilot being in Los Angeles." They found an 
expense record of Harold Nelson on the night of January 18. I think, 
at the Beverly Wilshire Hotel. They found, at another hotel, an ex- 
pense record for Mr. Paul Blanton.'who is the pilot; but not for the 
copilot, as I recall it. 

So, the flight obviously occurred. It was not logged, and it still is 
not logged. The last log flight on that jet was January 12, 1972 ; the 
tanks were drained on January 18, as I recall. 

Mr. Weitz. Can you provide us with copies of the fuel record and 
expense records for that date ? 

Mr. Heininger. I don't think they are expense records, I think they 
are hotel bills. I think it was a charge on an Express card, or some- 
thing. We will provide that. 

Mr. Weitz. "Wliat^ver you are able to find. 

Dr. INIeiiren. I have two things, I have the hotel bills for Blanton 
and for Nelson; and I have the fueling in Los Angeles. In fact, I can 

tell you now 

Mr. Plotkin. Just for clarification, are you saying that Nelson never 
filed an expense account covering those expenses ? 

Dr. Meiiren. Nelson paid for his Beverly Wilshire on an AMPI 
credit card, which on the first inquiiy was not discovered. Immediately 
after November 15, or whenever we were last here I asked Gary Woods, 
our comptroller to check and see. 

Now, Heinie then asked me, "Did you give him permission to use 
the jet ?" and I give you the best recollection of that I have, and I think 
the answer to that is "Yes." But I would like to ])ut this on the record. 



7251 

too. After the board meeting at which Mi-. Nelson was detached as 
general manager and I was installed, the executive committee and the 
officers of AMPI met out in our office, which is way out from town ; 
they met in my old office. 

Shortly after we met there Parr came down and said, almost plead- 
ingly, "Will you give me 2 or 3 minutes with you"; and I did, primar- 
ily for tranquility, I guess, it had been a very difficult day. I went up 
to the office I now occupy, whicli was then occupied by Mr. Nelson. As I 
recall there was Mr. Nelson, Mr. Parr, Mr. Howard, Mr. Townsend, and 
Mr. Ball. There were perhaps others, but those I remember. 

I recall verj^ well Mr. Parr saying to me that he would be most 
deeply grateful if I would make two immediate agreements with 
him; one is that Mr. Ball would become the manager of the north 
Texas division ; the second was that I would leave Mr. Howard and 
Mr. Townsend with him for his thinking operation in Little Rock. 

I know very well what my answer to that was. My answer was: 
"That this is January 12, it's a difficult day, these are matters which 
Avill have to be considered in conjunction with many other things; 
and I would certainly make no such agreements one way or the other 
now." 

I think at that time Harold Nelson asked me if he could use the 
jet to clean up odds and ends; and I think I said "Yes." Now, I next 
saw Harold Nelson, to my knowledge, some 10 days later. 

Mr. WEiTz.Did he tell you at that time of his meeting ? 

Dr. Mehrex. No. Let me proceed. I know this now, and I knew 
this 3 months ago. They went from San Antonio that night to Dallas, 
all of them ; this group. 

Mr. Weitz. All right. 

Dr. Mehrex. As far as I can find out — Parr told me that he had 
gone up there with them in order to quiet the wounds and heal the diffi- 
culties, et cetera — I know that Parr went up and came back, so I 
rather believe his story. 

They apparently went out that evening, late that evening from San 
Antonio to Dallas 

Mr. Heininger. That was the 12th. 

Dr. Mehrex. The 12th, yes; I know that to be true. I think that 
Nelson did say, more or less anxiously, "Can I use the jet to clean up 
odds and ends?" I think I said "Yes." Again, this has gone back 2 
years with the use of the jet. I might say for the record, I never used 
the jet after January 12 at all. 

He did not show, as I recall it, and I think I can establish it also, 
because Butterbrodt was tliere every Monday for the following three 
Mondays for the purpose of seeing what we could do to find out what 
really needed to be encompassed in the next few weeks. 

I think it was at least a week, or 10 days before Nelson came back; 
and I have no recollection of any statement about going to Los Angeles. 
And I do not, to this date, recall any one of them ever telling me 
this. In complete truth, as I have told you in an informal session, Mr. 
Weitz, the first knowledge I had of this was in the deduction from 
the question that Mr. Sale asked me. 

I will also say, if I had known, I think my procedures from there 
on would have been substantially different from what they were, for 
very good reasons. 



7252 

Mr. Weitz. Now, sometime around January 26, or 27 did you have 
an occasion to discuss with Mr. Jacobsen arrangements for a subse- 
quent meeting with Mr. Kalmbach ? 

Dr. Mehren. There is very great doubt that I discussed arrange- 
ments with him personally. 1 think, as best I can reconstruct it, that 
there were telephone discussions. The reason I am reasonably sure 
is because this was the day I first met general counsel — I mean legal 
counsel. 

Mr. Wfjtz. You are reasonably sure you didn't meet with him ? 

Dr. Mehren. With Mr. Nelson ? 

Mr. Weitz. No, we are talking about Jacobsen. 

Dr. Mehren. Oh, on January 26, no. 

Mr. Weitz. How about on January 27, do you recall meeting with 
Jacobsen on that day ? 

Dr. Mehren. I was in Chicago then, also, 

Mr. Weitz. Did there come a time, then, sometime before Febru- 
ary 3, when you discussed with Mr. Jacobsen, and agreed to meet with 
Mr. Kalmbach? 

Dr. Mehren. Very obviously, but I am not sure that was a per- 
sonal meeting. I know there were several conversations on the telephone 
with him — what does the calendar show ? 

Mr. Hbininger. I think the record, as I reconstructed it, there un- 
doubtedly were some telephone conversations with Mr, Jacobsen. And 
the final arrangements for going over to Los Angeles apparently were 
worked out between Mr. Jacobsen's secretary 

Dr. Mehren. And Mrs. Jamiesen. I have records to that effect, if 
you want that, I will give it to you. 

Mr. Weitz. Now, when Jacobsen talked about this matter what did 
he tell you ? 

Dr. Mehren. Basically that Kalmbach wanted to talk to me about 
the support of the President in 1972; and that Mr. Kalmbach was in 
effect the major fund collector for the Nixon campaign. And that in 
all likelihood, as he put it, that is, "Nelson reaffirmed we would have 
to live with these people" ; and that it would be highly desirable that 
I get to know him and discuss this matter with him. That, generally, 
was the thrust of it. 

Mr. Weitz. Did he indicate how he came to be the intermediary, 
or came to the position where he wanted you to contact Mr, Kalmbach ? 

Dr. Mehren. Only to this extent, that as I recall it he said to me that 
Mr. Kalmbach wanted to talk to me about this. 

Mr. Wettz. How did Mr. Jacobsen — did he explain how he came 
to that knowledge ? 

Dr. Mehren. No. Had he done this in December 1972, 1 would have 
asked him that question ; in January 1972 I didn't worry. 

Mr. Weitz. Mr. Jacobsen is a life-time Democrat, is he not? 

Dr. Mehren. In terms of party registration, or what? 

Mr. Weitz. Affiliation and activities. 

Dr. Mehren. No, not to my knowledge. He was a major fund- 
gatherer, I think, of Democrats for Nixon, wasn't he? 

Mr. Weitz. I said Democratic affiliation. 

Dr. Mehren. Was he a member of the party, you mean ? 

Mr. Weitz. Yes. 



7253 

Dr. :Mehren-. But I also say to my knowledge that he apparently 
sparked the collection of Democratic funds for the reelection of Kich- 
ard Nixon in 1972. 

Mr. Weitz. Did you perceive, or did he explain this role in January 
of 1972 as that role ? 

Dr. Mehren. Well, I think it was generally known, publicly 
known that he was a fundraiser for Democrats for Nixon.^ 

Mr. Weitz. Democrats for Nixon were not organized until the fol- 
lowing August. What did he tell you in January ? 

Dr. Mehren. Precisely what I said, that this is a man who wanted 
to talk to me. 

Mr. Weitz. You didn't express surprise and say, "Jake, what are 
you doing talking to Herb Kalmbach" ? 

Dr. Mehren. No, I didn't. 

Mr. Weitz. Did you know who he was ? 

Dr. Mehren. Yes, but only vaguely. 

Mr. Weitz. And did you ask Jacobsen how he came to know him? 

Dr. Mehren. No, I didn't because — look, now, Mr. Weitz, I knew 
Jacobsen had been a participant in a variety of political campaigns, 
which incidentally I had never participated in ; that he did have con- 
nections across the board. When Jake said to me "Mr. Kalmbach wants 
to talk to you as the new chief of AMPI about political contribu- 
tions," I took it for what it said, that Mr. Kalmbach had asked him to 
do it. 

I didn't know why he picked Jacobsen instead of somebody else, 
Jacobsen obviously had had a long and close connection with our 
preceding management. It was entirely likely that if Kalmbach did in 
fact want to speak to me, Jacobsen would be the person to whom he 
would go to set it up. 

I repeat now, Kalmbach testified that Jacobsen went to him. 

Mr, Weitz. Now, did there come a time in late January 1972, when 
you met with Marion Harrison in San Antonio ? 

Dr. Mehren. I think it was late January, I can't give you dates. 

Mr. Weitz. Sometime early in 1972. 

Dr. Mehren. Do we have a record of that ? 

Mr. Heininger. I don't think we do. 

Dr. Mehren. The point is, I don't think it's January. 

Mr. Weitz. Do you recall him spending the night at your house? 

Dr. Mehren. I certainly do. Do you want to know why? 

Mr. Weitz. No, I would like to know the purpose of the visit. 

Dr. Mehren. The purpose of the visit, as he put it to me, was to 
establish a relationship with me as the new general manager, and 
through me with the board of AMPI, different and more effective 
than what he had been able to establish with Harold Nelson and Dave 
Parr. 

Without any disparagement of Parr and Nelson, in essence what 
Mr. Harrison said to me was that he gave them excellent advice with 
respect to political procedures in Washington, and frequently they 
didn't adhere to it. 

Mr. Weitz. Did he indicate how ? 

Dr. Mehren. Well, the one I can recall at this stage is that he would 
arrange appointments, he would arrange discussions, which most 
often, as you recall, they would go ahead and do ; but then they would 



7254 

go around left end and meet with other people, which made it very 
difficult for him effectively to function as a door-opener and arranger 
of discussions. 

His basic request, if it can be so defined, of me was that if I would 
be workincr with him, I would give very careful consideration to his 
overall strategic recommendations, and not take collateral or outside 
action, which would diminish the effectiveness of what he was doing. 
Mr. Weitz. He didn't try to impress ui)on him the fact that he was 
a key Republican lawyer with contacts in the administration that 
you would do well to retain ; wasn't this the thrust of his conversation ? 
Dr. Mehren. That was implicit in his conversation, and again, with 
no disparagement of Marion Harrison, that has been implicit in any 
conversation I ever had with Marion Harrison. 

Mr. Weitz. Did he also explain that he had played a major role 
in the 1971 contributions to the President's reelection ? 

Dr. Mehren. I'm not sure he explained it, but by that time I knew 
it because it was in the press. 

Mr. Weitz. I think in your antitrust deposition, on page 151, you 
referred to the fact that Harrison told you that. 
Dr. Mehren. Not just then. 
Mr. Weitz. But he told you that. 

Dr. Mehren. I think the main thrust was how he and I v/ould work 
together. 

Mr. Weitz. Wasn't he worried that you would cut off his firm's re- 
tainer ; and didn't you discuss that ? 

Dr. Mehren. I expect he was. I don't recall his definitely saying 
this, but I think by then, I think by February he certainly knew that 
I liad required the comptroller of AMPI to give me detailed records 
on public relations people, lawyers, anybody on the collateral payroll 
at AMPI ; and I expect by the time that Marion Harrison came to my 
home he knew that I had detached quite a few of them. 

Mr. Weitz. Didn't he make some reference to the fact that he was 
necessary, and for you to continue to fulfill the commitments that had 
been made by prior management ? 

Dr. Mehren. To my knowledge, again, Marion Harrison never said 
that there were commitments. Again, if he had said it, it would not be 
disturbing to me, I would tell you so. I cannot recollect, and I will 
not fabricate recollections any more than fail to recollect what I know. 
Mr. Weitz. Now, we have a White House memo of January 1972, 
which makes reference to the fact that the milk people do not want to 
continue to deal with Reeves and Harrison. Do you have such knowl- 
edge of any such decisions, or discussions on the part of your coop- 
erative? 

Dr. Mehren. Not with any great precision. I think that there was, 
both with Mr. Nelson and Mr. Parr, a feeling that he had not effec- 
tively handled the committee machinery through which those TAPE 
funds were apparently allocated ; that it had been provocative of mas- 
sive trouble, which might have been avoided by rather more effective 
activity by Mr. Harrison. But I had heard nothing prior to my ini* 
tiation of tenure, Mr. Weitz, that would indicate firing him, or any- 
thing of that sort. 

Mr. Weitz. Did Mr. Harrison mention Mr. Jacobsen in that con- 
versation when he was at your house ? 



7255 

Dr. IMehren, Truthfully, I can't recall ; he may have. 

Mr. Weitz. Did he refer to Mr. Kalmbach ? 

Dr. Mehren. I don't recall any reference to Mr. Kalmbach at all. 
It was basically the two points to which you yourself have referred, 
or which I have discussed in response to your questions. 

Mr. Weitz. How about Mr. 
Chotiner? 

Dr. Mehren. I am not sure it was at that meeting that he made 
reference to Mr. Chotiner ; it may well have been. But this I can tell 
you, I do recall that at that, or some other meeting, Mr. Harrison told 
me about Mr. Chotiner becoming of counsel to Reeves and Harrison. 

I suspect it probably was at that meeting, because at that time I 
knew what the retainer fees were. Again, I am probably reconstruct- 
ing, which is dangerous and foolish. I rather think I asked him why, 
sometime in 1971, the retainer had gone from $50,000 to $107,500 ; but 
I believe there is a response to that question, that he told me the ar- 
rangement in respect to Mr. Chotiner. 

Mr. Weitz. Now, before we move to the February 3d meeting, just 
one other area. You mentioned the fact that you discussed commit- 
ments in general, and prior obligations and so forth, of management 
when you took over with Mr. Nelson, at least with respect to one mat- 
ter with Mr. Parr. How about Mr. Lilly, did you ask him about any 
such prior obligations, political 

Dr. Mehren. No, I did not. 

Mr. Weitz [continuing] or otherwise? 

Dr. Mehren. Not to my knowledge, anyway. 

Mr. Weitz. Did you know that Mr. Lilly had substantial political 
responsibility under prior management ? 

Dr. Mehren. It was my understanding that he had a political re- 
sponsibility primarily with respect to two types of political entities ; 
one was the State governments ; and the other one was associated with 
the Animal and Product Health and Sanitation. That was my under- 
standing then. 

Mr. Weitz. Do you remember meeting with Mr. Lilly, or seeing him 
in Washington in March of 1971, with respect to the price-support V 
matter ? \ 

Dr. Mehren. I don't have any memory of Mr. Lilly being present, 
but that doesn't mean he wasn't. 

Mr. Weitz. Now, on February 3, you, Mr. Nelson, and Mr. Jacobsen 
flew out to Los Angeles and met with Mr. Kalmbach. 

Dr. Mehren. Yes. 

Mr. Weitz. And also present was Mr. DeMarco, and others of his 
law firm ; is that correct ? 

Dr. Mehren. I am quite certain that Mr. DeMarco was there, and 
I think there were three others ; I don't know their names. 

Mr. Weitz. I see. 

Dr. Mehren. I'm not sure it was three. 

Mr. Weitz. The meeting began, as I understand it, in Mr. Kalm- 
bach's office, and then you proceeded to go to lunch ; is that correct? 

Dr. Mehren. Not quite. As I recall it, we walked about the area a 
bit because we were early, and discussed the architecture of the new 
Bank of America Tower. We then went upstairs, and I believe were 



725.6 

met by Mr. DeMarco. I would say it might have been 30 minutes 
after first meeting Mr. DeMarco that ISIr. Kalmbach came in. 

Tlien, I think, we proceeded to DeMarco's offices. 

Mr. Weitz. Now, in the earliest, the first contact with Mr. DelNIarco, 
did he discuss contributions in any way, before Mr. Kalmbach's ar- 
rival, or was it just pleasantries ? 

Dr. Mehren. No, it was no more than pleasantries, as I recall. 
These were pretty things, discussion of certain furnishings, certain 
art; I think there was discussion of the development of Kalmbach's 
firm, who they were, where they were. 

INIr. Weitz. There were no discussions of contributions? 

Dr. Mehren. No, only in the broad sense that we were there to dis- 
cuss contributions with Mr. Kalmbach ; but no specifics were discussed, 
as I recall it, Mr. Weitz, until the arrival of ]Mr. Kalmbach. 

Mr. Weitz. Now, when INIr. Kalmbach arrived and you proceeded to 
Mr. DeMarco's office, could you tell us in a general way the substance 
of the conversation ? 

Dr. Meiirex. Yes. I have a memory wliich I am not sure is precise, 
but be it correct, I believe Mr. Jacobsen introduced Mr. Nelson to Mr. 
Kalmbach. 

Mr. Weitz. To each other ? 

Dr. Mehren. That is my memory, it could be wrong. But, I re- 
member, for what it's worth, accurate or inaccurate, a discussion of 
Mr. Kalmbach and Mr. Jacobsen, the tone of which indicated they 
knew each other; and then in reference to Mr. Nelson as if they did 
not know each other. That was the first part. 

The next part, as I can reconstruct this discussion by Mr. Jacobsen 
at some length, maybe 5 minutes, or so, with respect to the total de- 
tachment of any political contributions, including those about to be 
discussed from any action by any element of the Government prior 
to such discussions, simultaneously therewith, or thereafter. To the 
extent that I recall, and I think I so testified to Bill Dobrovir, that 
this Avas a sort of a civics lecture, and I had for one reason or another 
taken two or three political science courses in my life ; this is unneces- 
sary, and get on with the business. 

Then there was specific disclaimer, and rather eloquently stated, 
genteelly stated, civilly stated by INIr. Kalmbach at substantial length, 
Alan, that this did not in any measure indicate adjustment to anything 
that had been done in the past or anything that would be done in the 
future. He went to very great lengths, and did it rather well, to in- 
dicate that this was a discussion of the possibilities of contributing 
to the reelection of Richard M. Nixon solely for the purpose of the 
reelection of Richard M. Nixon in the interest of the people of the 
United States; and carefully, not merely did not affirmatively refer 
to agreements, to commitments, to quid pro quo, but carefully laid 
the groundwork that no such constituent elements were by any con- 
struction involved in these discussions. 

Mr. Weitz. Now, if '\^niite House members, either at that time or 
earlier, had made reference to commitments of $1 million, $2 million, 
$90,000 a month, what does that indicate to you in connection with Mr. 
Kalmbach's conversation with you ? And I might add, referring to Mr. 
Kalmbach, again, he was reportedly aware of such commitments. 
Dr. Mehren. You are aware that I was not aware of such memos. 



7257 

Mr, Weitz. Yes. Let me ask you this : Doesn't this indicate to you, 
then, that Mr. Kahnbacli's references to you were cosmetic in nature, 
without regard to whether understandings had either ever been made, 
or ever been contemplated, or were to be made ? 

Dr. Mehren. As of now do I so consider, or did I on January 12, 
1972? 

Mr. Weitz. "Well, I take it that as of January 12, or as of February 3, 
you did not take these to be cosmetic? 

Dr. Mehren. No, I did not ; I didn't have any reason to do so. Let me 
say again, and perhaps those of you who are attorneys here can correct 
me. I would not have been deeply shocked if they had said directly and 
unequivocally, "Your predecessors have agreed to support the candi- 
dacy of Kichard Nixon in 1972." To my knowledge there is nothing 
unlawful about such an agreement, there is nothing necessarily im- 
proper about such an agreement. If they had said that to me, then 
I would have had to do exactly what I did with respect to other com- 
mitments, say that from Congressman James Jones, who most ve- 
hemently, orally, by telephone, by letter indicated to me that this was 
a flat handshake contract with Harold Nelson ; who did put a lawyer 
on my tail when I said I wouldn't fulfill the commitment, so-called. 
I would have done the same thing here. 

And, if I might say, perhaps to facilitate the discussion, if there 
had been reference to agreements to contribute in 1972, first I would 
have adjusted to it as best I could, I would have gone back to discuss 
that with my colleagues ; and I would have told you so. I would have 
no reason not to tell you. 

Mr. Weitz. Well, let me ask you this, I am trying not only to deter- 
mine with respect to your testimony, but also with respect to your 
knowledge from these other individuals, their reasons to tell you, or 
not to tell you. 

Now, the previous week, in January 1972, the Nader suit was filed ; 
and this was in the same vein as the adverse publicity in the fall of 
1971, Now, that publicity focused at that point on contributions of 
approximately $300,000 to the Republican Party, and a somewhat 
lesser amount directly to the President's committees. Now, I'm not 
sure of that — approximately $300,000, 

Dr, Mehrex. I think $422,500 to the committees, if I recall. 

Mr. Weitz. That is including 1972 ; but as of January 1972, there 
was upward of $300,000. Now, in light of the publicity, and in light of 
the suit that had been filed, was there not in fact a reason either not to 
discuss, or to try to minimize, or conceal on the part of someone a 
commitment that substantially exceeded the amount that had already 
been contributed and publicly reported ? 

Dr. Mehren. I can only conclude — and this is a dangerous conclu- 
sion which could never be established empirically one way or another — 
that these people thought that if they told me there had been a commit- 
ment, I would on my own, or with my colleagues, say that we won't 
need it. 

Mr. Weitz. Well, they testified that they did. 

Dr, Mehren. Well, I can testify 

Mr. Weitz. At least Mr. Nelson testified. 

Dr. Mehren. I have no such recollection, and I give you the best 
recollections I can. 



7258 

Mr. Weitz. Now— — 

Dr. Mehren. Let me finish because I think there is a point that you 
need here. The question of the Nader matter and the public reaction to 
the earlier contributions in 1971 did come up, and I so testified, 1 
think — I'm not sure I testified before. 

Mr. Weitz. My next question, then, will be : Was there not discussion 
of procedures that might be followed if additional contributions were 
made in 1972 ? 

Dr. Mehren. Yes, there was. 

Mr. Weitz. Who said that, and what was said ? 

Dr. Mehren. This was at lunch, and not, as I recall it, in the office of 
Mr. Kalmbach, 

Mr. Weitz. Well, at the office of Mr. Kalmbach, after he made these 
disclaimers, what, exactly, did he say ? 

Dr. ]\iEHREN. Well, what he said, that the President and he would be 
quite grateful if we found it jwssible for the good of the country to 
contribute to the support of the campaign for the reelection of Richard 
M. Nixon. 

Mr. Weitz. Did he mention any amounts, or quantity ; did he char- 
acterize it in any Avay as substantial contributions ? 

Dr. Mehren. Well, I knew this, and I think he understood I knew it. 
By that time I certainly knew that Herbert Kalmbach didn't deal with 
$50 contributions or $100 contributions. But the magnitudes came up 
only with respect to the question you are about to ask me, and those are 
disjunctive. 

Mr. Weitz. Before we get to that, what was your response in his 
office? 

Dr. Mehren. My response was that I would listen to whatever sug- 
gestions would be made, whatever requests were made ; that I would 
take it back and discuss it with my colleagues, and would respond 
later. This is what I do in ever^^ such matter that comes to me. 

Mr. Weitz. Did he make any further suggestions, other than the 
general request that you indicated ? 

Dr. Mehren. Nothing that was specific. He didn't say — among this 
now you are really asking me indirectly, "Your people have agreed to 
give me $1 million or $2 million," the answer is no. 

Did he say, ''Your people have agreed to give me anything at all," 
the answer is "No.'* 

Mr. Weitz. Did he say, "We understand your people are supportive 
of the President" ? 

Dr. Mehren. I don't recall his saying that. I do know he testified 
that I had once stated in that meeting that my single motivation was 
to assist in the reelection of Eichard M. Nixon. The fact is, on a per- 
sonal basis, which I detach from my job at AMPI, I have never once 
availed myself of any opportunity, "in California or elsewhere, to vote 
for Richard M. Nixon. But I do recall his having made that statement 
in his deposition to Dobrovir. No, it was really the security, the safety, 
the welfare of this country. 

Mr. Weitz. Did he mention any other contributions, or goal figures, 
for any other contributors ? 

Dr. Mehren. I am not sure he did, I know Lee Nunn did later, in 
terms of total magnitude. I don't recall Herbert Kalmbach saying it. 

Mr. Weitz. Is there anything 



7259 

Mr. Heininger. Now, this is again the conversation prior to lunch, 

Mr. Weitz. Yes. Is there anything you can recall with respect to the 
conversation at Mr, Kalmbach's offices before you went to lunch? 

Dr. Mehren. I can't, but if you have questions that you would like 
to ask me, I will try to answer them with respect to discussions prior to 
lunch. I think I told you what I can recall now. 

Mr. Weitz. Could you tell us the substance, of the conversation at 
lunch ? 

Dr. Mehren. Yes, I remember Herbert W. Kalmbach ordered what 
lie called a virgin Mary ; that is very firm in my mind. It moved to 
a discussion of how contributions, if they were made, now, should be 
made. It was there, and to my recollection only there, Mr. Weitz, that 
references to magnitude were made. 

I think that it was Mr. DeMarco, and I'm not sure, I think it was 
he, who said that if we were to contribute $350,000, it could be 
sequenced in a certain way. 

Mr. Weitz. What was that sequence ? 

Dr. Mehren. As I recall, he said the sequence could be, if it was, 
say, $700,000, you would put so much in immediately; so much prior 
to the 1st of March ; so much during March ; so much between April 1 
and April 7; and then some rather minor sum thereafter. 

Mr. Weitz. What would you approximate to be the percentage of 
the total contribution that he suggested could be made, or should be 
made, prior to April 7, 1972 ? 

Dr. Mehren. I think, now, and I am doing the very best I can to 
remember accurately, I believe he said — and this again was Mr. De- 
Marco, and not Mr. Kalmbach— that if you, say, find it possible to 
contribute $700,000, then it would be sequenced something in the neigh- 
borhood of $50,000 given after April 7. 

Mr. Weitz. Didn't he in fact say $750,000 ? 

Dr. Mehren. He may well have ; this is very difficult. I used to be 
most im]3atient with people who couldn't remember precisely — I don't 
know. The numbers that stick in my head are 350, and perhaps 750, 
or 700 ; those two numbers I do remember. 

Mr. Weitz. ^Yhy did he make that suggestion ; did you understand 
the purpose of dividing up the contribution ? 

Dr. Mehren. He didn't give me any specification of purpose, but 
even then, knowing a little about this, not very much, to be truthful ; 
it was very obvious that what he wanted to do was disclose a certain 
amount of it and not disclose another amount because my understand- 
ing of the terms of the law that expired on April 7, was that contribu- 
tions made prior thereto would not be disclosecl. 

Mr. Weitz. Was there any direct reference to reporting, and not 
reporting contributions ? 

Dr. Mehren. Only indirectly. Now, this is the first thing. The second 
thing that I responded — both of these I responded at that meeting; 
the firet thing was the matter of the sequence. 

The second was a matter of the recipient agencies, and here it was 
suggested — and again, that is my memory — ^this was Mr. DeMarco. 
although it could have been Kalmbach. Again, I am not being evasive, 
or coy, I think it was DeMarco who said that in this case they could 
set up State committees. That the State committees would consist of 
real people. They would have chairmen and vice chairmen, secretaries. 



7260 

treasurers, et cetera. They would be State committees, but they would 
not, in any measure, be associated with the Eepublican State commit- 
tees, wherever they were. He then said, as I recall, that what we could 
very properly do. and legally do would be to make contributions to 
these committees, report them accurately, fully in terms of complete, 
meticulous conformity to law; then, whatever those committees did 
with it thereafter was up to them. 

Mr. Weitz. Did he indicate that they w^ere not necessarily identified 
as committees for the President ? 

Dr. Mehrex. I don't recall his saying that. I do recall his saying 
that they would be fully separate, detached from the normal Republi- 
can State committees. 

It was at this stage that I did tell them, that I certainly made no 
decisions then and there, that I did immediately arrange for a com- 
plete termination of any individual decisions wtih respect to TAPE 
funds, or any other funds. I didn't like tJiis, and I think I turned to 
Mr. DeMarco at one stage and said, "I am very surprised that you 
suggest a thing like this, we have been through this bloodbath of what 
appeared to me to be committees of dubious constituency in 1971 ; and 
I certainly don't react well to a proposal to reproduce this activity," 

Mr. Weitz. What W' as his response to that ? 

Dr. Mehren. His response was that these would be different. These 
would be committees that were real committees, real people, real ad- 
dresses, real everything; therefore, the}- were different in kind as well 
as function from those to which I had taken exception with respect 
to 1971. I did take exception, and I still take exception to what they 
did in 1971. 

Mr. Weitz. But they likewise would have been committees for the 
reelection of the President. 

Dr. Meiirex. AVell, I don't think there was any effort to dissemble 
with respect to that. I don't think he came out and said that these 
special committees that he would set up, real as they mig"ht be, would 
not direct their activities and their funds towards the reelection of 
the President. Certainly he didn't say the opposite of it. But these 
are the two suggestions that were made. 

Mr. Weitz. Is there anything else that you can recall at the luncheon 
meeting w4th respect to contributions, or any other substantive mat- 
ters that were discussed ? 

Dr. Mehrex. That is a difficult question to answer. 

Mr. Weitz. Was there anything else with respect to contributions? 

Mr. Heinixger. (3ff' the record. 

[Discussion off the record.] 

Mr. Weitz. Back on the record. 

Let me ask, was there a discussion of any substantive policies, or 
administration decisions that affected AMPI ; were any such matters 
discussed at the luncheon ? 

Dr. Meiirex. Xot to my recollection, as I told you a little earlier, Mr. 
Weitz. He did make a rather long and elo(]^uent disclaimer of any such 
things. I have no recollection of the antitrust case l:>eing discussed. The 
only allusion to anything else was my response with respect to the pro- 
posal for temporal sequence and for committee structures. 

]Mr. Weitz. Now, was there any reference to the antitrust suit? 

Dr. INIeiirex. I don't recall any. 



7261 

Mr. Weitz. Mr. Jaeobsen, at page 159 of our executive session testi- 
mony here was asked, "Did he'' — meaning you, Dr. Mehren— "refer 
to the antitnist suit that had just been filed against AMPI"— this is 
referring to the meeting with Mr. Kahnbach — ^Slr. Jacobsen's answer, 
'"Yes ; I am sure lie did." 

Do you recall discussing the matter at lunch? 

Dr.' Mehren. No, I don't, and for this reason I think I am correct, 
Alan ; I remember a certain contrast. At one stage in the late Nunn dis- 
cussion I rec^all his saying, obliquely, "Well, it never could be quid 
pro quo, and never would be. It is correct that the President does re- 
member his friends who helped him.'' 

Now, that is as close to a quid pro quo statement as I think anybody 
ever came to me. I mentioned the Nunn comment because I do not re- 
call any such comment by Mr. Kahnbach, or Mr. DeMarco. 

Mr. ^YEITz. Did you ever discuss — apart from this meeting with Mr. 
Kahnbach — let me first say, do you recall discussing the antitrust suit 
with Mr. Kalmbach at all ? 

Dr. Mehren. I do not. My recollection is, it was an almost con- 
sciously directed eifort to avoid any appearance whatsoever at any 
stage of this discussion to any benefit that might come from contribu- 
tion; or any adverse reaction that might come from not contributing. 

Mr, Weitz. Did you hope that any benefits might accrue, whether or 
not they were overtly referred to? 

Dr. ]\Iehren. This again is a question to which I could give you what 
I now think to be my reaction 2 years ago — ^is that a clear comment 1 

^Ir. Weitz. Well, 1 am asking you what you thought at the tinie. 

Dr. Mehren. I can now respond to you, 1 think, what I now think 1 
thought at the time. Iwould have been deeply shocked 2 yeare ago to 
consider that, after having worked for administrations previously, 
that any reference to contributions would, in any measure, be tied to 
any action, or failure to act by an administration because in absolute 
truth, in participation in four preceding administrations at one level 
or another, the very thought of it would be deeply shocking to me. 

Again, this was 2 years ago. So, no ; as I look back on it, it seems to 
me now that I had a rather different response to this. Perhaps I didn't 
have it then, but I certainly have it now, and that is, if you don't con- 
tribute, what they might do. But to think even now that by contribut- 
ing through the committee, or any other way to an administration that 
some affirmative action would be engendered by it, no. I think, quite 
aside from morals, that would be stupid. 

Mr. Weitz. In 1972 you never discussed with anyone at AMPI, or 
representatives of AMJPI the hope and possibility that contributions 
would help in the antitrust suit ? 

Dr. Mehren. No ; I discussed with people at AMPI, and I discussed 
with Members of Congress quite the reverse. I have discussed with 
people in AMPI, and I am certain I have discussed with people in the 
Ooncrress that earlier contributions and the modes in which they were 
made, in my judgment virtually precluded a rational, ordered proce- 
dure under law in the resolution of the troubles with which we were 
afflicted. 

Mr. Weitz. Then, why did you tell Mr. Isham in the spring and 
winter of 1972, that you felt you would probably have to end up con- 
tributing to the President ? 



7262 

Dr. Mehren. I don't believe I ever said that to Mr. Isham. 

Mr. Weitz, Did you discuss the matter of contributions and the 
antitrust suit with Mr. Jacobsen in 1972 ? 

Dr. Mehren. I don't recall any discussions, there may well have 
been. 

Mr. Weitz. Did you ever express the hope to Mr. Jacobsen that such 
contributions might help alleviate the problems with respect to the 
antitrust suit ? 

Dr. Mehren. That's not my way of doing things, no. What you are 
really asking me, I think, did I suggest a process of bribery to Mr. 
Jacobsen ? It is not my procedure and my way of living that, if you will 
fix up an antitrust case, I will give you some money. 

Mr. Weitz. My question was, did you ever discuss with Mr. Jacob- 
sen in 1972, the hope that by contributing, the antitrust suit would 
somehow be alleviated, or eased ? 

Dr. Mehren. I have never, to my knowledge anywhere, tied together 
political contributions with the perversion of the system of justice. 

Mr. Weitz. It is Mr. Jacobsen's testimony to this committee that you 
did, in fact, in a private conversation with him discuss the hope that 
such subsequent conversations would help with respect to the antitrust 
suit. 

Dr. Mehren. Conversations, or contributions ? 

Mr. Weitz. In conversations with him that such contributions would 
help with the antitrust suit ; that would be incorrect ? 

Dr. Mehren. I have never, to the honest and best recollection I have, 
ever done such a thing; and I tell you that it would be totally anathema 
to me. I do not believe in bribery of governmental activities, sir. 

Mr, Weitz. You are characterizing it, I am not characterizing it. 

Now, there were several letters, I think, that you have been shown of 
February 1972, from Marion Harrison; one to ]Mr. Heininger, one to 
Mr. Russell, and one to you. 

Dr. IVIehren. Can I see them ? 

Mr. Weitz. The other two that are not addressed to you show copies 
to you. I believe you have seen copies of these letters ? 

Dr. Mehren. I have to look at them first. This is some irony that they 
insist on expedited depositions. I have seen it. 

Mr. Weitz. I am going to mark them and ask you specific questions. 
I'm not going into detail. 

Dr. Mehren. You Avant to ask on this one, from Harrison to 
Russell ? 

Mr. Weitz. You have seen those three letters. I am going to mark 
this as exhibit 1-A, a letter of February 28 from Russell to Heininger; 
and 1-B, a letter from Harrison to Russell ; and finally 1-C, a letter 
from Harrison to you. 

[Whereupon, the documents referred to were marked Mehren ex- 
hibits Nos. 1-A, 1-B, and 1-C for identification.*] 

Mr. Weitz. Now, these letters are all late February 1972, and the 
subject matter is the antitrust suit that had been filed by the Justice 
Department against AMPI on February 1, 1972. 

Now, in the letter from Marion Harrison to you, exhibit 1-C. the 
first sentence begins, "In view of the changing of the guard, apart from 

•See pp. 7349-7352. 



7263 

Jake's reasoning, I decided, witli Murray's concurrence not to talk with 
the incumbent but to take the matter up anew with his successor." 

With respect to that paragraph, first of all, what was Jake's 
reasoning? 

Dr. Meiirex. Well, now, I'll have to go back. Let me try to put this" 
thing together now as best I can. As I recall this matter, Stuart Russell, 
out of his own volition, stated that he knew people at various levels at 
the Department of Justice with whom he had worked in the past. 

I had, I believe, said to Russell, possibly to Jacobsen also, and cer- 
tainly to Mr. Heininger and to Members of the Senate here that it 
appeared to me that the extreme press exposure of the alleged activi- 
ties of 1971 had so hardened the position of the Department of Justice 
that it was virtually impossible to talk compromise, or consent, which 
was in fact given in the early days as a decree cited ; and in fact there 
is an ultimatum in the original. 

My interest, and I think ultimately out of Mr. Heininger, was to 
see whether Ave could counter the apparent intransigence of the Justice 
Department people at least to sit down and reasonably discuss the 
possibilities of consent. 

Now, that, I believe, I said to virtually every counsel involved in this 
battery of litigation that I inherited. I knew what Russell suggested. 
What Jake's reasoning is at this stage, I don't know. I suspect that 
Jake's reasoning would be, if you follow the usual procedures that 
Jake follows, that we would find access through contacts that Jacob- 
sen could establish, idtimately, if necessary, to discuss the possibilities 
of compromise with the Attorney General, as free as possible of the 
deeply seated preconceptions that seemed to burden the Chicago 
office on the working level of the Department of Justice. 

Proper or not, Heinie, I think you and I discussed that. 

Mr. Weitz. "VAHiat access is Jacobsen referring to ? 

Dr. Mehrex. Mr. Jacobsen's usual access, after the termination of 
the Johnson administration was Mr. Connally. Whether it was here, 
I can't specifically recall, but I assume it to be so. 

Mr. Weitz. Now, this letter is dated February 25. 

Dr. Meiirex. Yes. 

Mr. Weitz. On March 16, 1972, you met with Mr. Connally, didn't 
you? 

Dr. Mehrex. Yes. 

Mr. Weitz. At whose suggestion ? 

Dr. Mehrex. Jacobsen's. 

Mr. Weitz. Who else met with you ? 

Dr. Mehrex. Mr. Nelson. 

Mr. Weitz. What did Mr. Jacobsen talk to you about in connection 
with that meeting ? 

Dr. Meiirex. Setting it up. I can give it to you almost verbatim. 
"Mr. Connally has become a very impoi-tant man in this administra- 
tion ; he is going to be an important man in the future. He does not 
know you, and it would be very desirable for you to know Mr. Con- 
nally.'' 

That was the presentation that was made to me. 

Mr. Weitz. Did he refer directly, or indirectly to the antitrust suit? 

Dr. Mehrex. I don't think he referred to the antitrust suit at all 



7264 

As I testified, the reference to the antitrust suit was, as I testified, in 
passing, and in a battery of discussions of other points. 

Mr. Weitz, What reference to the antitrust suit? 

Dr. Meiirex. I am talking alx)ut the discussion with Connally. 

Mr. Weitz. Did Jacobsen refer to the antitrust suit? 

Dr. Mehren. No. I can remember March 16, at least parts of it fairly 
well. There was no such statement, to my recollection. 

Mr. AVeitz. Prior to March 16 ? 

Dr. Mehren. No. 

Mr. Weitz. There was none? 

Dr. Mehrex. No, no; there was no reference on March 16 to the 
antitrust suit in Jacobsen's representation that he was setting up an 
appointment for me to meet the Secretary of the Treasury. 

Mr. Weitz. Did he tell you at that meeting on March 16 ? 

Dr. Mehren-. I believe so, it was March 16. As I recall, and I think 
I am correct in this, he advised me that sometime during the day on 
March 16 that he had a 5 o'clock meeting. I recall telling him that I 
couldn't make it, and he then said he would set it at 2 p.m. ; and es- 
sentially he did. 

Mr. Weitz. You were in Washington at the time ? 

Dr. Mehren. Yes. 

Mr. Weitz. Why did you come to Washington ? 

Dr. Mehren. I think there was a very heavy agenda in Washington. 
I came to meet the chief buyer of A. & P. who is one of our major cus- 
tomers. Not all of my work is associated with political activities. I 
might also say, I had discussions with the Department of Agriculture. 

Mr. Heininger. Here is the agenda that relates to that meeting, if 
it's of any interest to you. 

Dr. Mehren. I should say, in answer to Mr. Weitz's question— — 

Mr. Weitz. A number of other meetings were scheduled ? 

Dr. Mehren. Mr. Townsend, Mr. Mills, ^Ir. Belcher, Mr. Albert— 
I'm not sure I saw him. I'm very sure I didn't see these people. 

Mr. Heininger. Mr. Campbell. 

Dr. Mehren. Campbell, I'm quite sure I saw. I am sure I saw Paarl- 
berg. 

Mr. Weitz. One at a time. What took place at the meeting with Mr. 
Connally ? 

Dr. Mehren. On March the 16 is the only meeting I ever had with 
him, in fact. 

Very well, Mr. Jacobsen reset the meeting at approximately 2 o'clock. 
At 2 o'clock Mr. Nelson, Mr. Jacobsen and I went to the anteroom. I 
would say we waited perhaps 15 minutes. The meeting in total would 
be 20 minutes at the least, and 30 minutes at the most. 

There were the usual amenities of the introduction and becoming 
acquainted. Then the basic essence of the subsequent discussions was 
difficulties afflicting the dairy industry at large, and with very little 
specific reference to AMPI. 

I think that I have stated that there were some six points, and I 
know what they are, in here, that we went over. Basically, these points 
are in the memorandum I have given you earlier. They were discussed 
broadly. 

The point I made was that it appeared to us — not just to me, but to 
many people in the dairy industry — that a pattern of adverse reaction 



7265 

on the part of the administration at large was needlessly and fortui- 
tously damaging to us; and that opinion was becoming very wide- 
spread, if such was the case. 

It was only in the matter of costs, a private and civil litigation with 
the Department of Justice that the antitrust suit was mentioned. It was 
not a major point. 

Mr, Weitz. Did you express the opinion to Mr. Connally that there 
was a negative attitude on the part of the Department of Justice, 
the administration, toward dairy cooperatives ? 

Dr. Mehren. Yes. 

Mr. Weitz. So, it wasn't just with respect to costs that came up 

Dr. Mehren. Oh, no, it came up as to price support; it came up 
here 

Mr. Weitz. Did that include — one of those elements was the anti- 
trust suit? 

Dr. Mehren. It was the antitrust suit as one element within a fabric 
of litigation. 

Mr. Weitz. Why did you include the price-support matter when 
in fact Mr. Nelson, according to your testimony, had committed your 
cooperative not to seek an increase ? 

Dr. Mehrex. I included that, I kept that commitment, as I told you. 

Mr. Weitz. So, therefore, it would not have been surprising. 

Dr. Mehren. No, no ; the Secretai-y of Agriculture, quite aside from 
representation from AMPI, did in fact receive representation from the 
rest of the dairy farmers of the United States with virtually no excep- 
tion. The Secretary of Agriculture made his finding at the lowest pos- 
sible level that he could make it under the law; and I did say that 

Mr. Weitz. Are you aware that in March of 1971, the Prasident met 
with representatives not only of AMPI, but a number of cooperatives. 
Now, unless that is a meeting we are not aware of, where Mr. Nelson 
made this commitment to the President, if he in fact made the commit- 
ment, would it have been at that meeting? 

And are you also aware that in the White House "TVTiite Paper" 
w^ith respect to the milk price-support question, the President indi- 
cated that in making his decision in March of 1971, he was setting it. 
essentially, for 2 years ? 

Dr. Mehren. I have not really read the "White Paper", Mr. Weitz ; 
I have read press excerpts from it. I can tell you only that in response 
to my questions, and the information given to me by other participants 
in tliat meeting, I was advised that Nelson had said that AMPI would 
not make representation for an increase in 1972. After consultation 
with the board, I agreed to keep that commitment. Therefore, there 
was no AMPI submission. 

However, there were submissions from the National IVIilk Producers' 
Federations, and I believe from most of the other cooperatives in the 
TTnited States. 

The fact to which I referred in my discussion with Mr. Connally 
was that regardless of the substance of such representations, or the 
scope of such representations the Secretary meticulously placed the 
price support in 1972 at the lowest possible level ; and I took that in 
conjunction with other decisions that had been made by the adminis- 
tration that seemed virtually punitive to me, and still do. 



7266 

Mr. Weitz, Does that include the antitrust suit ? 

Dr. Mehren. To be truthful, I have more doubts with respect to the 
genesis h.nd progress of the antitrust suit now than I had before. 

Mr. Weitz. What did you expect Mr. Connally to do with respect 
to this matter, including the antitrust suit ? 

Dr. Mehren. I expected Mr. Connally to do precisely about these 
matters — not necessarily including the antitrust suit — that I had done 
many times when as Assistant Secretary people came in and said, 
"Your program is destructive to us; it is needlessly, fortuitously, 
wantonly destructive to us, can you do something about it?" That's 
what I had in mind. 

Mr. Weitz. What did you want him to do with respect to the anti- 
trust suit ? 

Dr. Mehren. I made no request for him to do anything. 

Mr. Weitz. What did you intend for him to do ? 

Dr. Mehren. Well, again, the reference to the antitrust suit, and the 
inclusion of the antitrust suit in this rather brief and broad-ranging 
discussion with Connally did not involve any request for interven- 
tion, nor would I expect any. 

]Mr. Weitz. You didn't expect him to intervene in any of them, the 
antitrust suit along with the other problems. 

Dr. Mehren. It had no greater priority than any of the others. In 
fact, the import matter was probably more destructive to us in terms 
of cost and income than the antitrust suit. 

Mr. Weitz. Wasn't it your hope that in respect to some of these 
matters he would pass on, as a very well respected, as Mr. Jacobsen 
put it, key man in the administration to those who might take favor- 
able action ? 

Dr. Mehren. Well, your language is a little bit more precise than I 
like. I have been in the same position many times, at a somewhat lower 
level as Assistant Secretary. 

Yes, I would have liked Mr. Connally to understand what the reac- 
tion of our people w\as; what the apparent effects of the deeply ad- 
verse reaction of the administration were, and wherever he properly 
and lawfully could, to see if he could mitigate it, yes. There was no 
special reference. If you are trying to get me to say that there was 

Mr. Weitz. I am trying to understand why you mentioned the anti- 
trust suit, if you didn't want him to pass that message along with 
respect to the antitrust suit for anyone to take action. 

Dr. Mehren. I passed to him the same statement that I later said 
to Senator Eastland. I know, I am quite sure I said to Senator Tal- 
madge, that there seems to be a total intransigence in the discussion 
of compromising this matter. 

Mr. Weitz. The antitrust suit? 

Dr. Mehren. Yes, and effectively developing a consent. 

Mr. Weitz. But, what did you want him to do about it? 

Dr. Mehren. About this one? You are asking about this one, now, 
instead of the 15 other points that were covered there. You don't want 
me to talk about the imports, or 

Mr. Weitz. What did you want him to do on imports? 

Dr. Mehren. I wanted him certainly to see if he could make clear 
to his colleagues in the Cabinet of the United States that to open 
imports the way they have done was most destructive, not only to the 



7267 

support and market-order programs, but to the income level of the 
farmers of the United States; and also, therefore, to the mainte- 
nance of an adequate milk supply in the United States. 

Mr. Weitz. What did you want him to do with respect to the anti- 
trust suit ? 

Dr. Mehren. The only thing I would want him to do, if it were 
proper and effective for him so to do, to say to anybody whom he 
might want to discuss this with— I certainly didn't make any sugges- 
tions of any discussions of anything of substance on any of these 
points to him — that if he could, to see that reasoned discussions could 
be reached free of the pressures of the propaganda and publicity 
that were then affecting both the Department of Justice and us. That's 
all. 

But, let me say, most explicitly and firmly, that I do not and have 
not, and never will go to a Cabinet member and say, "You go over 
there and muck up our law case." Law cases get mucked up enough 
without it. 

Mr. Heininger. Off the record. 

[Discussion off the record.] 

Mr. Weitz. Back on the record. 

Now, I believe you said your hope was that he would make a rea- 
soned discussion of your position with those in the Cabinet, and else- 
where who might bring reason to bear on the problems that you men- 
tioned, including the antitrust suit. Did he call John Mitchell at that 
meeting? 

Dr. Mehren. Yes; to my knowledge, he did. 

Mr. Weitz. Did he enter into a reasoned discussion with John 
Mitchell about the merits, the procedure by which the antitrust suit 
was filed ? 

Dr. Mehren. I don't think he mentioned the antitrust suit; I have- 
no recollection of it. 

Mr. Weitz. In fact, did he engage in a discussion of the merits, 
or reasoned discussion with John Mitchell ? 

Dr. Mehren. No ; he did not. 

Mr. Weitz. What did he say ? 

Dr. Mehren. Essentially, what he said is, "I have a group of people 
here who seem to be somewhat incensed with what they seem to con- 
sider systematic punitive action of this administration." He said in 
essence that, "This <"an do us damage in the Middle West," and as I 
recall it he said, "You get some people out there and find out what 
is going on because we are going to have political trouble if we don't" ; 
that was the essence of his conversation with Mr. Mitchell. 

I do not recall, and I am quite certain of this recall, of any direct 
reference in his discussion with Mr. INIitchell, or his purported dis- 
cussion with Mr. Mitchell of price support, of exports, of imports, or 
market orders, or any of the other matters with which we were 
concerned. 

Mr. Weitz. Did you talk with him about the political considera- 
tions, with John Connally, these various problems ? 

Dr. Mehren. No, not really. I told him about the matters about 
which our people, the daiiy farmers, generally, and the cooperatives, 
generally, would be deeply disturbed ; and they were. 



7268 

Mr. Weitz. Did you talk about the political aspects, or considera- 
tions ? 

Dr. Mehren. I don't recall my saying that; this was his reaction to 
what I told him. 

Mr. Weitz. Was his reaction dift'erent than what you had hoped it 
would be ? 

Dr. Mehren. Very honestly, on a personal basis, and detached in 
my professional — no disrespect to Mr. Sandei-s, I would have had no 
great personal trauma if the Republicans would have lost in the Mid- 
dle West ; if you will forgive me, sir. 

Mr. Weitz. What generated that call, what generated that type of 
conversation ? 

Dr. Mehrex. I can give you this, again, as best and as accurately 
as I can recall it. W^e talked about 15 minutes, which fact alone pre- 
cludes any detailed discussion of any single element of this rather 
long battery of complaints here. 

As I recall it, he picked the phone up and said, ''Please, give me 
Mr. INIitchell," and within a very short period of time, there was Mr. 
Mitchell. Then the conversation followed, as I gave it to you. 

But it was really the political repercussions that might be asso- 
ciated with the attitudes I had expressed as a representative of our 
people. I thing he also said — and I heard this from others, too — that 
he did not say, to my Imowledge, that it was Jacobsen, or Nelson, or 
me, or friends sitting here, or any particular people. 

Mr. Weitz. Is there anything else you recall that he said to Mitchell ? 

Dr. Meiiren. That is such a hard question to answer after 2 years. 
If you ask me specifics 

Mr. Weitz. I take it your answer would be no, then. 

Dr. Mehren. I don't recall, that's right. 

Mr. Weitz. That he said anything else that you recall. 

Dr. Mehren. That doesn't mean if you ask me specifics I wouldn't 
recall it. 

Mr. Weitz. When he got off the phone, did you say, "Now, don't get 
me wrong, I am not saying that we are not going to be supporters, we 
just have these problems"? 

Dr. Mehren. No, the question was never — — - 

Mr. Weitz. Did you agree with his representation to ]\Ir. ]\Iitchell 
that they would be in trouble in the INIidwest? 

Dr. INIeiiren. I wasn't really competent to make that decision. I 
knew that there was substantial adverse reaction to what was going 
on; and I think quite properly so. And I also think that representa- 
tions to JNIembers of the Cabinet, of ]\Iembers of Congress witli respect 
to what was considered to be inequitable, or otherwise unpleasant 
activity Avas entirely proper. I would have no reservation about doing 
it again, it has been done in my office many times; and I see nothing 
wrong with it. 

^Ir. Weitz. Who else did he call ? 

Dr. Meiiren. As I testified before, I think he made a very, very 
short call to Mr. Dole. 

Mr. Weitz. In your presence. Do you recall anything of the sub- 
stance of that conversation ? 

Dr. Meiiren. My recollection, which is far less precise there than 
with respect to the purpoi-fed call to John INIitchell 



7269 

Mr. Weitz. Purported call ? 

Dr. Meiirex. I don't know whether it was John Mitchell on the 
other end, or not. 

Mr. Weitz. He made some call and asked for some Mr. Mitchell, and 
then talked to someone on the line. 

Dr. Meiiren. Yes. 

Mr. Heininger. The assumption is that it was John Mitchell. 

Dr. ]Meiirex. Sure, I have no way of knowing. 

Mr. Weitz. And you are making the same assumption with regard 
to Mr. Dole. 

Dr. Meiirex. I am not saying that the Secretary of the Treasury 
faked it ; I don't know whether it w^as Mr. Mitchell, or not. 

I recall, again, with far less precision — it was a very, very short 
conversation with Senator Dole, to the same effect; that, "As the 
chairman of the Republican National Committee you are apt to get 
youreelf in trouble if these attitudes become more pervasive." 

Mr. Weitz. Did he call the Attorney General ? 

Dr. Meiirex. I don't think he was the Attorney General. 

Mr. Weitz. No, I said, "Did he call the Attorney General." 

Dr. Meiirex. No. 

Mr. Weitz. Did he call the Secretary of Agriculture? 

Dr. INIehrex. No. 

INIr. Weitz. Did he make any efforts on your behalf, do you know, to 
discuss the merits of your discussions, or the topics in a reasoned way 
with any other Cabinet member? 

Dr. ]Meiirex. Not in my presence. Again, this entire session, includ- 
ing tlie social amenities, this discussion, and his later discussion alone 
with Mr. Jacobsen took not more than 30 minutes. 

Mr. Weitz. Did Mr. Jacobsen tell you, before or after this meeting 
of the substance of any private conversations he had with Mr. Con- 
nally, with respect to the dairy people, in any way ? 

Dr. Meiirex. I don't recall, sir. 

]\Ir. Weitz. Now, was there also a reference at this meeting to politi- 
cal contributions to the President? 

Dr. Meiirex. Yes, not really to me, but just before the termination, 
and perhaps not taking more time than 1 minute. I think it was mainly 
to Jacobsen, a suggestion from the Secretary of the Treasuiy that if 
the dairy people at large — in those words precisely, there was no refer- 
ence of "you, sitting here", or to AMPI, to TAPE — if you did make 
a decision to contribute to the campaign, in his x^rofessional judgment 
it would be more useful toward the end of the campaign than now. 

Mr. Weitz. Wasn't it a problem of publicity at the time ; didn't he 
make a reference to the fact it would be better to wait until the heat 
is off? 

Dr. ISIeiirex. I don't think so. My recollection is of what he said, 
"They'll need it worse at the end of the campaign than they do now." 
And that it could be put to better use. 

Mr. Weitz. How did the reference come up ? Did it come up in refer- 
ence to import quotas ? 

Dr. Mehrex. No. It did not come up in reference to these points 
here. 

Mr. Weitz. How did it come up ? 



7270 

Dr. Mehren. As I recall it now, and again, this is a difficult thing 
to do; I believe it was a suggestion made directly by the Secretaiy, 
at his own initiative, and without any direct reference to anything 
else. It was merely "If you people decide" ; and the general tone • 

Mr. Weitz. Had Mr. Jacobsen been talking about contributions? 

Dr. ISIehren. He may have, not in my presence. 

Mr, Weitz. He didn't tell you about it. 

Dr. Meheen, Did Jake tell me? 

Mr. Weitz. Did he tell you about these conversations ? 

Dr. Mehren. No. 

Mr. Weitz. Did INIr. Jacobsen indicate he had talked to others, be- 
sides Mr. Kalmbach, in Government, or as Republican fundraisers 
with respect to possible contributions? 

Dr. Mehren. No, not specifically, to my recollection. Jacobsen 
talked, or implied in all of the relatively few conversations I have 
had with Jacobsen, he had connections into the Republican adminis- 
tration, just as he had always implied in earlier discussions that he 
had sucli contacts into the Democratic administration, preceding Mr. 
Nixon's; is that he could get repi^sentation. He could get people in 
decisionmaking positions to hear what we had to say. I am not sure 
Jacobsen ever said this to me directly, with respect to the Republican 
administration, but certainly it was implicit in his behavior. 

Mr. Weitz. Now, in your antitrust deposition on page 219, and again 
at page 225, you refer to the fact that there was no discussion of inter- 
vention by Mr. Connally in the antitiiist suit "in my presence"; was 
there any, to your knowledge, discussion with INIr. Connally outside 
of your presence? 

Dr. Mehren. I believe I also testified in that deposition that as we 
left, I think, Mr. Connally asked Mr. Jacobsen to stay by for a mo- 
ment or two, and Nelson and I went out in the hallway. Mr. Jacobsen 
came out smiling and reported that the Secretaiy had taken mild um- 
brage with reference to his attire. 

Mr. Weitz. Did Jacobsen make any reference as to what they 
discussed ? 

Dr. Mehren. No. 

Mr. Weitz. Did he, at any other time, discuss with you any basis 
for belief, or any reference, whether or not he indicated the basis for 
it, that Connally could help with respect to substantive matters, par- 
ticularly the antit rust suit ? 

Dr. Mehren. Not particularly the antitrust suit. 

Mr. Weitz. With respect to what ? 

Dr. Mehren. With respect to anything. The general indication of my 
discussions with Jacobsen was that Mr. Connally was a man of major 
potency, major influence, properly exercised within the administra- 
tion ; and merely to get Mr. Connally to understand what our difficul- 
ties were, was to take one step toward the resolution of the difficulties. 

Mr. Weitz. Do you have any explanation as to why Mr. Connally 
initiated the discussion at that meeting with respect to possible contri- 
butions ? 

Di-. Mehren. It didn't seem to be, at that time, an out of line matter 
at all. I suppose Mr. Connally knew that the TAPE people, and the 
other people in the industry, the dairy industry had con- 
tributed heavily before. He probably knew they had three sets 



7271 

of mechanisms, at least — four, I guess, that I can think of — in which 
contributions lawfully could be made. He probably Imew that there 
were rather rich treasuries involved in all of them. 

He would probably, therefore, conclude that these people will have 
to make decisions as to whom they support, to what extent ; and I would 
suppose that out of that general knowledge, which by then was avail- 
able t-o almost everybody in the United States, his suggestion may have 
been generated. But again, there was nothing sinister in his suggestion 
at all. 

Mr. Weitz. Now, let me ask you this, Dr. Mehren, these rich treas- 
uries that existed, which he certainly, if he supported the President in 
1972, was interested in, why do you suppose he was so sure that you 
were going to support the President that he would not even ask you to 
contribute right away, and not wait for 6 months, w^hen perhaps you 
would be predisposed to support another candidate, as yet unnamed by 
the Democratic Party ? 

Dr. Mehren. I can only tell you what he said. 

Mr. Weitz. I know you told us what he said. I am asking you what 
you understood by that. 

Dr. Mehren. I understood him to be telling the truth, and to be 
expressing an honest professional opinion. At least at that stage in the 
history of the United States when a Cabinet officer said to me, or to 
others sitting there, that he felt that political campaign contributions 
would be more useful and more needed later in the campaign, I took it 
to mean what he said ; and not to involve, necessarily, any hidden mo- 
tives. I am not sure what you are asking me, I am trying to answer. 

Mr. Heixinger. Off the record. 

[Discussion off the record.] 

Mr. Weitz. Back on the record. 

Do you recall meeting with Mr. Kalmbach that day, on March 16 ? 

Dr. Mehren. I do not recall that day. As you know, we have tried to 
find out. I don't think it was that day, Alan, but your records could 
be right. 

Mr. Weitz. Well, let me put it this way, you met with Mr. Kalm- 
bach one other time after the February 3 meeting, in 1972, is that 
correct ? 

Dr. Mehren. Yes. 

Mr. Weitz. And at that meeting you were in Washington, and Mr. 
Nelson and Mr. Jacobsen were also in Washington, is that correct? 

Dr. Mehren. Yes. 

Mr. Weitz. And that was an occasion when you didn't fly in and out 
on the same dav, but rather stayed in a hotel in Washington. 

Dr. Mehren.' I think I left the night of the 16th of March. 

Mr. Weitz. Yes ; I'm saying that was the occasion when you met 
with Mr. Kalmbach. 

Dr. Mehren. Well, I stayed in a hotel ; yes. 

Mr, Weitz, Was that at the Madison Hotel that you stayed? 

Dr. Mehren. Yes ; it was. It was in one room, and it was really in 
the Madison Hotel that Mr. Kalmbach came. 

Mr. Weitz. And Mr. Kalmbach also stayed at the Madison Hotel 
that time? 

Dr. Mehren. I don't have any idea. 



7272 

Mr. Weitz. Well, didn't you go to Mr. Kalmbach's room when he 
was hurriedly packing? 

Dr. Mehren. No ; I did not ; Mr. Kalmbach came to the suite I was 
staying. 

Mr. Weitz. Where was Mr. Kalmbach going to that day ? 

Dr. Mehren. I don't know. 

Mr. Weitz. He didn't tell you he was going off to New York ? 

Dr. Mehren. He did not. 

Mr. Weitz. Now, the records of the Madison Hotel for the first 5 
months of 1972, indicate that only on one occasion were you, Mr, Nel- 
son, Mr. Jacobsen, and Mr. Kalmbach registered at the Madison Ho'tel 
within a day, and that was March 15 and March 16 of 1972. Would 
that be consistent of your recollection as to having met Mr. Kalmbach 
in the hotel ? 

Dr. Mehren. Well, you disturbed my recollection more than you 
think by asking me if I recall going to Mr, Kalmbach's room while 
he hurriedly packed ; I have no such recollection whatever. I am quite 
certain I never was in Mr. Kalmbach's room. 

Now, the second part of your question, really, I think asks me the 
fact if that is the only day all of us were registered at the Madison 
Hotel, precludes any meeting with Mr. Kalmbach on any other day, 
I would be required to answer no ; it does not so preclude it. I don't 
know whether Mr. Kalmbach always stays — ^have you checked the 
other hotels ? 

Mr. Weitz. Every hotel in Washington, no. 

Mr. Heininger. Off the record. 

[Discussion off the record.] 

Mr. Weitz. Back on the record. If Mr. Nelson testified it was 
March 16, 1972, would that be consistent with your recollection? 

Dr. Mehren. My recollection is that it was not on March 16, but 
I can't tell you. This wasn't on the agenda, it wasn't on the schedule. 
It was arranged, as nearly all of these things were arranged, by a 
call from Jacobsen. 

Mr. Heininger. Alan, to his best recollection it is still April 24. 

Dr. Mehren, I think so. I am not being difficult with you, Alan, on 
or off the record. I am trying to give you as honest a recollection as 
I can give you. I do not think it was March 16 for one damned good 
reason above all others. After getting through with Connally, I had 
to go back to the Madison Hotel, pack up and make an hour trip out 
to Dulles — I know I was there at 5 o'clock because I got the call from 
Earl Tilbert out there. 

Mr. Weitz. Did you meet Avith Mr. Kalmbach before you met with 
Mr. Connally ? ^ 

Dr. Mehren. I don't think so, Alan. Again, I am not being in any 
manner evasive if it was that date, but I don't think it is. 

Mr. Weitz. Now, at this meeting, whenever it took place, whether 
it was in March, or April of 1972, what was the substance of the 
discussion with Mr. Kalmbach ? 

Dr. Mehren. I testified before as to the substance of it, and I have 
no reason to amend that testimony in any measure that I know of. 
As I recall the matter, sometime during the day Jacobsen said that 
Mr. Kaluibach would be coming by. I think it was about 2 :30. I also 
remember, with less precision than I would like, that it was a rather 



7273 

miserable, rainy type of a day. He came in, and there was a very 
brief conversation, genteel, as had been tlie first one. 

The thrust of it was that as a fellow Calif ornian, would I wish 
some day to go home and rest in peace and tranquility; and I said, 
"Of course." He said, "In that case you will be happy to know that 
I will not proceed any further with discussions, or negotiations on 
political contributions." 

As I recall, I had Nelson in one room of that suite, asking him 
in ; and I think he got Jacobsen from somewhere else. I think it was 
in the presence of those two, I am reasonably certain, that I asked 
Mr. Kalmbach, "Do you agree that the termination of this represen- 
tation does not involve any breach of a commitment made by any- 
body else, it's your own statement that you are not going to " 

Mr. Weitz. Why did you say that ? 

Dr. Mehren. Because I was beginning to get nervous about it, I 
thought from the begimiing you are damned right there might be 
some kind of a commitment involved in this. If you really want to 
know, if there was a commitment I would have liked to know because 
a breached commitment would have frankly mattered to me, as I told 
you before. 

Mr. Weitz. And you asked Nelson, and he said that there was no 
commitment. 

Dr. Mehren. Yes. 

Mr. Weitz. Kalmbach had made a disclaimer in February 

Dr. Mehren. Yes, sir. 

Mr. Weitz. Parr had specifically i-efuted any association. 

Dr. Mehren. Yes, sir. 

Mr. Weitz. A^Hiat did you base your suspicion on ? 

Dr. Mehren. Oh, the fact that' it had been done in 1971, apparently. 
There was a remarkable temporal association of contributions and 
representations to the Government which was disturbing to me. It 
could be totally innocent, but at the very best it was most, most stupid 
and indiscreeit. 

I wanted to be very certain that I did not put 40,000 dairy farmers, 
who to my knowledge had not been involved in any of these activities, 
in a position where punitive action could ever be taken. That's putting 
it very bluntly, and very honestly. 

Mr. Weitz. In other words, if there had been a commitment you 
didn't want to take action that would be a breach of that commitment. 

Dr. Mehren. If there was a commitment, I would have wanted to 
resolve the commitment and do it honestly and openly ; and I would 
either say, "I can meet it," or "Can't meet it," but not just break it. 

Mr. Weitz. Did you ever ask ]Mi'. Kalmbach whether there was a 
commitment ? 

Dr. Mehren. No. 

Mr. Weitz. Why didn't you ? 

Dr. Mehren. Because at that time, and in that environment when he 
said to me there was no commitment involved in February, I took it to 
he, his word ; but I still was nervous, and I wanted to cover any possible 
avenue of reaction that I could cover. I considered that to be a duty for 
anybody that was working for the farmers that I represented. 

I might also say to you, it's very easy to sit here 2 years later and say, 
"'\^niy didn't you do this and that'.*' 



7274 

Mr. Weitz. Well, you said it was a deep concern of yours, and you 
had the opportunity twice to ask Mr. Kalmbach. 

Dr. Mehren. I took his assertion in the first meeting that there was 
no commitment, no quid pro quos, commitments or agreements; that 
was his statement and I didn't argue with it. 

Mr. Weitz. What led then, after the first meeting, to your deep 



concern 



Dr. Mehren. I think what led to my deep concern was the apparent 
participation by Nelson and Jacobsen, the reasons for arranging meet- 
ings and discussions that I couldn't quite understand, plus the height- 
ening press references to the 1971 matters that made me Avant to be 
very sure then, that I could not be put in a position, acting unilaterally 
as I had to, w'hich I do only when I am required to do. I had no chance 
for consultation w^ith the board, or w4th the executive committee, or 
with the TAPE Committee, to make a decision that would adversely 
affect 40,000 people. 

Mr. Weitz. Did you tell Connally that? 

Dr. Mehren. AVliat? 

Mr, Weitz. That there w^ere no commitments for contributions? 

Dr. Mehren. I don't think the matter ever came up. 

Mr. Weitz. Well, the question of contributions came up. 

Dr. Mehren. Yes, but the matter of commitments, or agreements 
was never discussed in that meeting to my recollection. 

Mr. Weitz. Did you understand at this March or April meeting, did 
you understand Mr. Kalmbach to discontinue solicitations for con- 
tributions for the rest of the campaign ? 

Dr. Mehren. Yes, that w-as my understanding, which was another 
reason, I think it was April, rather than March. 

Mr. Sanders. Before you leave this, I want to ask a question or two. 

Mr. Weitz. Did Nelson or Jacobsen make any statements in Kalm- 
bach's presence ? 

Dr. Mehren. I cannot recall substantive statements. 

Mr. Weitz. After Kalmbach left, did the three of you discuss it, or 
any two of you discuss it, to your know^ledge ? 

Dr. Mehren. I don't recall it. Probably, almost inevitably we must 
have said, "Is it good news, or bad news ?'' 

Mr. Weitz. Did anyone discuss the reason for tliis information be- 
cause it was, I think, highly unusual, or somewhat unusual ? 

Dr. Mehren. Not to my knowledge. 

Mr. Weitz. Mr. Sanders ? 

Mr. Sanders. Now, in telling us what Kalmbach told you when he 
firet came to the suite, you made some remarks about Kalmbach saying 
you could return to California in tranquility. 

I wish you would rei>eat all that and explain it to me, because I don't 
understand the import. 

Dr. INIehren. I think I understand the import, I certainly cannot 
give it to you in any verbatim sense, Mr. Sanders, but it w^as a pleas- 
antry to the general effect that here is one more matter that you may 
otherwise have been required to resolve, which now is resolved uni- 
laterally by me; and the burden of making the decision is herewith 
lifted from your shoulders, I doubt that any more than that was 
meant by it. 



7275 

But, you would have to ask him what he meant by that rather cryptic 
statement, rather than me. 

Mr. Sanders. But, on the basis of what he said, you still had this 
concern, or maybe had a greater concern that there were some earlier 
commitments. So, you called Nelson and Jacobsen to get a reaffirmation 
from Kalmbach that there was no commitment ? 

Dr. Mehren. No, it was not so much commitment, I merely wanted 
these two people who by then I began to understand, and understood 
far more effectively later, were involved in almost every contact asso- 
ciated with solicitation of funds ; of themselves to hear that Mr. Kalm- 
bach, on his own, had decided that the Kepublican people would not 
ask us for any contributions. 

My general reasoning there, Mr. Sanders, looking back — ^^and maybe 
that is an ex-post-rationalization — was that this would resolve also any 
further representation from them with respect to the matter, and put 
us in a position where, if the TAPE Committee, and the board of direc- 
tors, of their own accord decided to contribute to the Republican com- 
mittee, or anybody else, they could do so. 

But, it would free me, and would free my colleagues on the board 
of directoi-s from any further participation in the matter, and I wanted 
them to know it. It was not to test him, or to find a witness to his 
statement, anything of that sort. 

Mr. Sanders. That was in effect what he told all of you, that the 
Republicans would not expect any further contributions from AMPI ? 

Dr. INIehren. No, he didn't say that, as I recall it. He said that he 
would make no further representation with respect to campaign 
contributions. 

Mr. Sanders. And you didn't take that to mean that it was limited 
to AMPI? 

Dr. Mehren. No, I think it was limited to AMPI because he was 
talking to me, and I certainly could not speak for the other people, I 
never have in matters of this sort in any measure whatever. I think he 
was speaking to me. But, what he said, I take to be what he meant, that 
he, personally, would make no more representation to AMPI ; that is 
what in effect he said. I am reasonably sure that is what he meant, 
because I understand that other dairy people did contribute to the 
Presidential campaign of 1972. 

Mr. Sanders. Now, when you speak of him as saying he would 
make no further representations to 

Dr. Mehren. I think that was the word. 

Mr. Sanders [continuing]. AMPI? 

Dr. Mehren. To TAPE. 

Mr. Sanders. Do you think he was using the word "representations" 
in the sense of an attorney-client relationship ? 

Dr. Mehren. No; I don't think so. I think he was using it — and 
again, I can't with any precision say what he meant by it — but I am 
quite certain that is the word he used. I think he took representation 
to mean that he had spoken in the past about the possibility of contri- 
bution, and that he would not do so in the future. That is what I took 
the word to mean. 

Mr. Sanders. Something in the nature of no further solicitations ? 

Dr. Mehren. I am not even certain that I could say that Kalmbach's 
earlier discussions involved what could be called solicitations; it was 



7276 

an exploration of the possibility of contribution. I am not sure he ever 
said to me "give us money," although that was the purpose of the dis- 
cussion, obviously. 

No; I simply took it that he meant he wasn't going to talk about 
this any more. 

Mr. Sanders. Did you underetand there might be some time later in 
the year — from him, did you understand that there might be some time 
later in the year when contributions w^ould be acceptable ? 

Dr. Mehren. I am quite certain that my reaction was that at that 
time Mr. Kalmbach was speaking for the campaign mechanism of 
Kichard M. Nixon. I took it to mean when he said, ''There would be 
no more representation from him," that there would be no representa- 
tion from the campaign machinei'y of Richard ^I. Nixon to try to 
obtain political f mids from TAPE. 

Mr. Sanders. Not even at a later time? 

Dr. Mehren. It certainly never occurred to me that he would come 
back. 

Mr. Plotkin. Did it enter your mind when Mr. Kalmbach made his 
statement, "There would be no further representation," he was doing 
it with the thought in mind that this would ease your present problem 
with regard to the antitrust suit ? 

Dr. Mehren. No; there was never any such allusion, nor could I 
derive any such conclusion from his statements. I know what he said in 
his deposition, and I presume you do too, that it wasn't worth it, there 
was too much work. I don't know whether that was his real reason, or 
not, that is what he said. 

Mr. Plotkin. At that specific moment, I mean you obviously — when 
you met with him, you didn't anticipate prior to this meeting that he 
was going to tell you he wasn't going to make any further solicitations. 
So, didn't it at some place enter your mind that in view of your cur- 
rent legal problem at the time with the administration, that it might 
have made things look bad for the administration, as well as also 
remove a burden from your shoulders if they made no further solicita- 
tions ? 

Dr. Mehren. It certainly didn't occur to me at that time. It had oc- 
curred to me, certainly by that time, and certainly it occurred to me 
much later that, given the litigation, given the adverse reaction to the 
price support, that for us to give a contribution of any size to Richard 
M. Nixon would be destructive not only to oui"selves, but, jjious as it 
may sound, destiTictive to our system of law; and deeply inhibitory 
to the i^roper latitude of executive action, not merely by the President, 
but members of the Cabinet. I sincerely believe this, and I know some- 
thing about this because I have sat in sub-Cabinet positions and know 
what kinds of inhibitions this can place upon you. 

Mr. Plotkin. Would you care to speculate on the possibility that as 
a result of Mr. Connally's phone call to JNIr. Mitchell, and Mr. Mit- 
chell's position as campaign chairman, that he might have contacted 
Mr. Kalmbach, assuming you met with Mr. Kalmbach following your 
meeting with Mr. Connally, that this was to be one of these little bene- 
fits, although you were not asking Mr. Connally for any favor, w^ould 
have helped you out by not asking ? 

Dr. Mehren. That is a tenable hypothesis, at least a remotely tenable 
hypothesis; but it is also a hypothesis which is tenable in the sense 
that perhaps several thousand other hypotheses would be tenable. 



7277 

I have no basis whatsoever to think that a telephone conversation 
to one end of which I listened, was transmitted to Mr. Mitchell ; from 
Mr. Mitchell to Mr. Kalmbach, and then it was decided that this bur- 
den would be taken off our back. I have no reason to reach that conclu- 
sion at all. 

Mr. Plotkin. To the best of your recollection, what were your initial 
reactions when, what was obviously a burden to you, was removed from 
your shoulders ? 

Dr. Mehren. My immediate reaction was a hypothesis which is no 
more and no less tenable than the one you just posed. My immediate 
reaction was that the combination of the burgeoning publicity with re- 
spect to I.T. & T., compounded by the earlier and continuing pub- 
licity with respect to the so-called milk fund had probably led these 
people to believe that further solicitation of funds would be destruc- 
tive to them ; and that the adverse reaction from contributions would 
probably be more than offsetting any financial benefit they got from 
contributions. 

That was my conclusion to myself which I have never transmitted 
to anybody else imtil this moment ; that's it. I could be quite wrong 
in this, just as I think you are wrong in yours, Mr. Plotkin. 

Mr, Plotkin. And you had no specific motivation to probe Mr, 
Ka 1 mbach 's 

Dr. ]VIehren. I don't function that way. It's very easy for an attor- 
ney 2 years later in an interview of this sort to say, "Why didn't you 
ask this, why didn't you ask that". What you do in an operating sense, 
if there is a decision that is made, and it is a decision that appears 
to be basically desirable on a net basis, I do not probe into the psycho- 
logical motivations of the person that has made that decision. 

]SIr. Plotkin. Well, isn't it a fact that Mr. Nelson had stated prior 
to that meeting that, yes, there was a definite commitment from 
A^IPI to the campaign ; and then Mr, Kalmbach has said to you what 
he said ; would you have then probed his intentions ? 

Dr. Mehren. Had I known that there was a commitment ? 

Mr. Plotkin. Had you known there was a definite commitment. 

Dr. Mehren. I think — and this again is an ex-post-rationalization — 
if there had been a commitment, or I had been told there was a com- 
mitment; I think I would have done what I did, in absence of any 
statement with respect to consideration, or agreement. I would have 
said, "Now, this, then, is not to be taken as a breach of any commit- 
ment, real or fancy," which is what I said tO' him anyway. 

Mr. Plotkin. But 

Dr. Mehren, Had there been a commitment, I tell you what I 
would have done because I did it with everything else, some of which 
were, I repeat, rather dubious ones, I would have gone to my colleagues 
on the board, executive committee, and said, "It appeare that a com- 
mitment was made," In some cases I would say, "I think you should 
meet the commitment" ; in others, as I did with Congressman Jones, 
and as I did with half-dozen others, I would say, "No, I think this is 
a commitment which could properly be made by any individual 
without discussion with his colleagues, and, therefore, my 
recommendation is we don't meet it," 

Mr, Plotkin, I don't want to, in any way, question your intelligence, 
or astuteness in this matter. Dr. Mehren 



7278 

Dr. Mehren. I become wary when you say that. 

Mr. Plotkin. Well, I know that Mr. Weitz has done that before — 
but in view of what we are dealing with, the problems that existed 
for you at that particular time, the sums of moneys that have been 
bandied about, I find it a little bit difficult that somewhere along the 
line of your conversation with IVIr. Kalmbach you w^ouldn't have said 
why he was dropping any requests for funds, regardless of whether 
there was a commitment, or no commitment. 

Dr. Mehren. It may be the dilTerence in the way we work as in- 
dividuals, you as an attorney, myself from a totally diiferent back- 
ground with perhaps more operational activity than you have had. 
It would not occur to me now, I think, to ask "Why are you doing 
this." 

Mr. Plotkin. It wouldn't ? 

Dr. Mehren. I'll tell you this, I have learned on this very Hill, and 
once learned, it was certainly a humiliating situation, that if the judge 
gives you a decision, close your briefcase and leave, and don't argue 
with it. I have learned it here personally. 

[Discussion off the record.] 

Mr. Weitz. Dr. Mehren, were you aware that Mr. Kalmbach was 
associate finance chairman of the Committee to Re-Elect the Presi- 
dent, from February 15, 1972, until April 7, 1972 ? 

Dr. Mehren. I think to be explicit and prex^ise, I became aware of 
that when I first tuned in on the so-called Watergate Hearings. I did 
know this, that he was a major figure in the campaign matters. But 
I did not, I think, to be quite precise, know what his title was. 

Mr. Heininger. Will you give me the dates again, Mr. Weitz? 

Mr. Weitz. February 15 until April 7. 

Are you also aware then, from these hearings, that he ceased to be, 
as you put it, major fundraiser, or participant in the financial affaii-s 
after April 7, 1972? 

Dr. Mehren. Yes ; I think I did know — I certainly knew after the 
broadcasting of the Watergate Hearings — I don't know when they 
started — that he had been so removed. I'm not sure I knew it then. 

Mr. Weitz. Now, if Mr. Kalmbach, as he testified publicly and 
privately, was no longer an active fundraiser after April 7, and he 
was in Europe for the balance of April 1972, would that refresh your 
recollection in any way, tend to shed some light on when he actually 
met with you in the Madison Hotel ? 

Dr. Mehren. Well, obviously, if he was in Europe, and it is so estab- 
lished, we certainly didn't meet witli him in the ]Madison Hotel while 
he was in Europe; that is not meant to be an offensive, or flippant 
answer. 

Mr. Weitz. One more time, do you connect in any Avay the meeting 
with Mr. Kalmbach and the message he gave you with the meeting 
with Mr. Connally, and the brief discussion you had with him, and 
he had with you, concerning contributions? 

Dr. Mehren. I have never heard a question, or a response which 
would link the broadranging discussion of Connally to any actions of 
Mr. Kalmbach. 

Mr. Weitz. I was referring to tlie portion of the conversation with 
Mr. Connally that mentioned contiibutions, timely contributions. 

Dr. Mehren. No; that is a hypothesis that did not occur to me 



7279 

Mr. Weitz. I am not posing a hypothesis ; I am asking you whether 
you connected 

Dr. Mehren. No; I didn't. Did I connect it then, or do I connect 
it now ? 

Mr. Weitz. Then? 

Dr. Mehren. No. 

Mr. Weitz. Do you connect it now ? 

Dr. Mehren. It is a possibility, but it had not occurred to me until 
you just asked the question. I will also tell you that was not what Mr. 
Kalmbach said to me. 

Mr. Weitz. Well, didn't he say, "I am not going to be asking"— 
the substance of it was he wasn't going to be asking for any more 
contributions ? 

Dr. Mehren. The substance was, there would be no more representa- 
tion. 

Mr. Weitz. "By me"? 

Dr. ;Mehren. Well, he didn't say "by me." The implication that I 
got from it, and Lord knows, you will have to ask him ; the interpreta- 
tion that I got from it was that the mechanism that he had represented 
had decided not to pursue efforts to get contributions from TAPE. 
Now, that is my conclusion, rightly, or wrongly, at that time. 

Mr. Weitz. I believe you said on the same day you met with Mr. 
Butz, Mr. Campbell, and Mr. Lyng. 

Dr. Mehren. I think I met them in the morning. 

Mr. Weitz. Did you discuss the antitrust suit with them ? 

Dr. Mehren. I don't think so. 

Mr. Weitz. I believe in your deposition 

Dr. Mehren. There was some discussion 

Mr. Weitz. I believe in your antitrust deposition on page 275, I 
believe, you said you did. 

Dr. Mehren. There was one discussion, and again, I'm not sure 
whether it is. Again, this is not an effort to be evasive with you. There 
was one meeting I had with Earl Butz, and I have known him very 
closely for a good many years, in which he did say that perhaps at 
the right time they could speak to the Department of Justice with 
respect to the activities and functions of farmer cooperatives. 

Mr. Weitz. Do you knoAv that Dick Lyng approved the filing of 
the antitrust suit ? 

Dr. Mehren. I know Avhat Dick Lyng has told me before. 

Mr. Weitz. What did he tell you ? 

Dr. Mehren. He said almost in these words, that Mr. McClaren 
came over and brought the tentative civil complaint. He said in 
essence, almost verbatim, repeated to me no less than 10 days ago that 
he said, "You take care of your jurisdiction, and I'll take care of 
mine. If in your judgment you think it should be done, go to it." 

Mr. Weitz. If there ai'c memos in the Department of Justice's 
files contrary to that, that would not refresh your recollection 2 

Dr. Mehren. I can only tell you what Mr. Lyng told me. Mr. Lyng 
told me at a meeting of the Supermarket Institute in Miami, Fla., in 
suite 1310, about 10 days ago, precisely what I told you here. 

Mr. Weitz. Now, did you also meet, on or about March 16, 1972, 
with Bob Strauss? 



7280 

Dr. Mehren. Again, I don't know the dat©. Is that on the agenda ? 
I did meet with Bob Strauss. 

Mr. Weitz. Was that sometime in March of 19Y2 ? 

Dr. Mehren. I think so, but I would have to look. The only time I 
was in Washington, I think, was March 16. I don't know if it was on 
that same day, or not. 

Mr. Weitz. And was the substance of your discussion with Mr. 
Strauss in connection with contributions to both the Republican and 
Democratic National Conventions, the purchasing of books ? 

Dr. Mehreist. Yes. 

Mr. Weitz. And was the amount that was discussed that of $100,000 
for each convention ? 

Dr. Mehren. Yes, sir. 

Mr. Weitz. And was it not then contemplated to go forAvard with 
that as an alternative contribution at the present time to President 
Nixon ? 

Dr. Mehren. It was not so posed to me ; no. 

Mr. Weitz. Was it then discussed in that context by you and others ? 

Dr. Mehren. No. To my knowledge, the proposal from Mr. 
Strauss — ^who at that stage, as I recall, said he was also speaking for 
the Republican committee — was never linked to any contributions. 

Mr. Weitz. Oh, I know, he didn't link it. 

Dr. Mehren. Or as a substitute, or alternative. 

Mr. Weitz. Did you ever discuss with anyone at AMPI that this 
would take the place of additional contributions at that time to Presi- 
dent Nixon ? 

Dr. Mehren. I don't think so. I think I discussed it, and expressed 
my own personal opinion that this would be a foolish expenditure of 
money. You know the details of the proposal, I presume. 

Mr. Weitz. The letter I am trying to find and enter as an exhibit 
will speak for itself. Off the record. 

[Discussion off the record.] 

Mr. Weitz. Back on the record. Now, we have two letters and mem- 
orandums, one is exhibit 28 ^ to the Lilly executive session ; and it con- 
sists of a letter, memorandum from George Mehi-en to John Butter- 
brodt, Griffith, Besemer, and Bonnecroy 

Dr. Mehren. For your infonnation, that is the TAPE — committee 
for TAPE, executive committee. 

Mr. Weitz. All right, and that is dated March 20, 1972. Attached to 
that is a letter, dated March 16, 1972, from you — to you from Robert 
Strauss in connection with this. 

Dr. Mehren. Alan, that would almost certainly mean that the meet- 
ing with Strauss — for whatever relevance — could not have been the 
16th. I do remember meeting Strauss at the Watergate — if you will 
forgive the expression — I remember his taking a car out to the airport, 
I think at about 12:30 or 1 o'clock, with a statement that he would 
write to me the next day. 

Mr. Weitz. You may have met liim on the 15th. 

Dr. Mehren. Yes. 

Mr. Weitz. And then exhibit 2'9 

Dr. Mehren. Do you want me to read them, or what do j^ou want me 
to do ? 



1 See Book 14, p. fil86. 

2 See Book 14, p. 6189. 



7281 

Mr. Weitz. No, I just think that refers to that, and I wanted you to 
take a look at them. 

Also exhibit 29, a memorandum from you to Lilly, and attached a 
letter, dated March 27 from the Republican National Convention to 
you with respect to a similar proposal. 

Dr. Mehren. This I recall, that I don't. 

Mr, Weitz. Now, in the memorandum, which is the cover memoran- 
dum for exhibit 29, you indicate to Lilly that you want this returned to 
you for the next day, March 30, when there is going to be a TAPE 
committee meeting, to take up that matter. 

Was that matter discussed at that TAPE committee meeting 'i 

Dr. Meiiren. I think so ; I can't say with precision. 

Mr. Weitz. And what was the disposition ? 

Dr. Mehren. The answer was a unanimous "no,'' as I recall. 

Mr. Weitz. Do you have anything in your file that would indicate 
that you expressed and communicated that to either Mr. Strauss, or the 
other gentlemen from the Republican National Committee ? 

Dr. Mehren. I think I telephoned him ; I'm not sure. 

Mr. Weitz. And when was that done — shortly after the meeting ? 

Dr. Mehren. It would have been, normally ; but I don't have dates, 
I'm sorry. 

Mr. Weitz. Now, did that communication and that decision have 
anything to do with the thirty $5,000 checks signed by you on April 4, 
1972? 

Dr. Mehren. Not to my knowledge. I told you before, that is the. 
one and only gap that I am not able to repair. I don't think so. 

Mr. Weitz. Let's not get into that — off the record. 

[Discussion off the record.] 

Mr. Weitz. We will take a recess, now. 

Dr. Mehren. Let me help you on the record to know why that was 
turned down. 

Mr. Weitz. All right, let's just get that out of the way. 

Dr. Mehren. Why don't you ask me ? 

Mr. Weitz. All right. Can you tell us why that recommendation was 
turned down? We are not referring to the contributions to the 
conventions. 

Dr. Mehren. There was unanimous reaction that to provide every 
one of the members of AMPI with two Convention Guide Books fbr 
themselves, and one each to give to their friends would be a fortuitous 
waste of money, and probably an irritant to our people. That was the 
reason for it. We just thought it would be a rather silly thing to do. 

Mr. Weitz. We will recess now until after lunch. 

[Whereupon, at 2 :30 p.m. the hearings adjourned to reconvene at 
5 p.m. this day.] 

Afternoon Session 

Mr. Weitz. All right, back on the record. 

Dr. Mehren, I would like to turn your attention to a period of early 
April 1972. Now, do you recall or have any recollection in connection 
with the drawing of the thirty $5,000 checks in blank on April 4, 1972 ? 

Dr. Mehren. Basically, not much more recollection than I have 
given you before. We have, I think, through our attorneys included 
every possible line of inquiry I know. I can tell you this much, that on 
that day I had the pricing statute from the Department of Agricul- 

30-337 O - 74 - Bk. 16 - 23 



7282 

ture. I had a difficult decision to make with respect to RiisselL I had, 
I think, the meeting that you have referred to earlier; I am not sure 
who all was present. I believe Nelson was there. I had the Fond du Lac 
matter which was by far the important one, and we had checked the 
night, Alan, since I talked to you last. I had a very elderly plant man- 
ager from Iowa who was afflicted with lung cancer, heart disease, et 
cetera, as a house guest with his wife, and he incidentally collapsed 
and I had to carry him to bed. But with respect to what they were, 
I don't know. 

I have asked if anyone in the household has any memory of the call 
that you mentioned to me on the telephone, and in truth I don't. 

Mr. Weitz. Let's go step by step. First of all, I have 30 — what pur- 
ports to be the 30 checks on the Committee for TAPE account with 
your signature and L. Elrod. Each in the amount of $5,000 in blank 
and all dated April 4, 1972. 

Mr. Heininger. I think one is dated April 5. 

Mr. Weitz. I think you're right. The check numbers are 25 through 
54, and I believe check No. 51, which is the first of a series of four 
checks on a different check form, the last four of the 30, that is, is 
dated April 5, 1972. I would like you to take a look at these, and I will 
mark them for the record. 

Dr. Mehren. Yes. 

Mr. Weitz. Total is $150,000. I will mark these together as one 
exhibit, and I believe it would be exhibit 2 to your executive session. 

[Whereupon, the checks referred to were marked Mehren exhibit 
No. 2 for identification.^] 

Mr. Weitz. Now, I believe that you referred to a meeting with Mr. 
Nelson. Could you tell me what you do remember with respect to that 
meeting ? 

Dr. Mehrex. It's a very difficult thing to give you, and again I speak 
with some embarrassment because I think the one subject matter which 
I don't have good memory, I think that it was a meeting at which he 
was present. I think Lilly was there. I think Elrod was there. But 
Elrod stated to our attorneys that he wasn't there. I have only a vague 
memory of the meeting occurring at all. 

Mr. Weitz. This was on the 4th, or on the day the checks were 
signed ? 

Dr. INIeiirex. This is on the 4th as our books show. It was scheduled. 

Mr. Weitz. Tlie meeting was scheduled at your office in San 
Antonio ? 

Dr. ]Meiirex. Yes, it was so scheduled and I think it was in fact held. 

Mr. Weitz. Do you recall the purpose of the meeting or how the 
meeting came to be arranged ? 

Dr. Meiirex. Why there is this blank, I do not know. I am not dis- 
turbed by the matter because there are 2 days in fact of whatever it 
was, it wasn't paid and there is no question I terminated any possibil- 
ity of jiayment and secondly, the records which need not have been 
Ivept were kept. So first, whatever it was, nobody got anything and sec- 
ondly, there was no effort to fail to disclose. 

Mr. Weitz. Do you have copies of these checks in your records? 

Dr. Meiirex. These records were kept and there is a substantial rec- 
ord all the way thi-ough. You would note the number on these are our 
OAvn. 



rrpviouslv pnterod as Lilly exhil>it No. .'{0. Sco Book 14, p. 61<)1. 



7283 

Mr. Weitz. No, I want to repeat the question. Do you have in your 
records and the TAPE or the Connnittee for TAPE records, any rec- 
ords for these — the copies of these checks ? 

Dr. Mehren. The original of those checks were there. 

Mr. Weitz. You do 

Dr. Mehren. Yes, they are there. 

Mr. Weitz. I would like to produce those for the committee. We did 
not receive these from TAPE. 

Mr. Heininger. Well, let me say in the stuff — and I guess you're still 
on the mailing list of the stuff in the Department of Justice, those did 
come from our files. 

Mr. Weitz. I see. 

Mr. Heininger. As a matter of fact, I might also point out that we 
produced those pursuant to a subpena in the antitrust litigation to 
TAPE or the Committee for TAPE. 

Mr. Weitz. I see. 

Dr. Mehren. Let me also say, if I may, one other thing which you 
haven't asked but I think you should know. To the best of my knowl- 
edge, I did not clear the voiding of these checks with my col- 
leagues on the TAPE Committee. 1 have also checked the records on 
that and the TAPE Governing Committee was set up on March 10, 
but was functioning well before that. To my knowledge, no request for 
funds were ever approved since I have been around without clearance 
by a majority of those people. None of them have any memory of this. 

Mr. Weitz. Of what? 

Dr. IVIehren. Of these 30 checks. None of these and these are people 
with whom I work closely. That is one point I think you should know. 
The second point is that to my knowledge, these are the only instru- 
ments in which there isn't the usual and quite meticulously complete 
voucher. I don't know whether you know it or not, but I instituted im- 
mediately, or I think by March 1, a mechanism whereby every check 
of TAPE was identified with respect to who asked for the contribu- 
tion, to what purpose it would be put, who would receive it, a receipt 
form was included so that in every other outlay on TAPE or the Com- 
mittee for TAPE, since I have had anything to do with it, there is 
this detailed record. On these, there is nothing more than this. 

Mr. Weitz. Can you explain that ? 

Dr. Mehren. No, I wish I could. To be completely honest, I wish I 
could. 

Mr. Weitz. Now, let's see if we can suggest things that may bring 
something to mind. 

Dr. Mehren. All right. 

Mr. Weitz. Do you recall any calls that day in the context or in con- 
nection with that meeting to or from Mr. Jacobsen ? Do you associate 
him in any way with this transaction ? 

Dr. Mehren. So vaguely that I am reluctant to say that I recall it. 
I have a less vague recollection that Mr. Nelson was involved with the 
request for these moneys. 

Mr. Weitz. And yoii also say that your recollection, based on your 
records is a meeting which took place when Mr. Nelson was present? 

Dr. Mehren. There is on my books a meeting scheduled, but as you 
also may have noted there were many meetings scheduled but did not 
occur. I think it did. Others say it did not. 



7284 

Mr. Weitz. Would it be consistent for example, with testimony we 
have as to the participants of the meeting, that a meeting of that sort 
did take place on that date ? 

Dr. Mehrex. I think it did, I am not sure who was present. 

Mr. Weitz. Do you know whether these contributions were to go to 
the President or the Republican Party sources of some sort? Not 
sources, recipient rather. 

Dr. Mehren. No, I don't. There is one person that said I had said 
it was a request through Mr. Lilly for 30 checks for Democrats and I 
do not think that is so. I would think, and again if I knew, I would tell 
you. I think these were probably for Republicans l)ut that is a recon- 
struction without memory. 

Mr. Weitz. I believe you testified today and previously that there 
was a hypothetical put to you at the P'ebruary 3 meeting out in Los 
Angeles by perhaps Mr. De^Larco. 

Dr. Mehren. Yes. 

Mr. Weitz. In connection with numerous or several contributions 
prior to April 7 and possibly through State committees organized 
apart from the Republican State committees to receive such contribu- 
tions if they Avere to be made. 

Dr. Mehren. Yes. 

Mr. Weitz. Did you in any way associate this transaction or this 
])urported transaction with that suggestion or the me^chanism de- 
scribed in that meeting ? 

Dr. Mehren. To me, now, in terms of simple logic and simple ef- 
fort to be as open Avith you as I can on this difficult matter, it may 
well be that 30 committees were involved. But I cannot say. I have 
told you the reason I say this, I don't have it in my mind. 

Mr. Weitz. Do you recall any discussion of the fact that the $300,000 
was to be delivered prior to Api'il 7, and $150 from TAPE or Com- 
mittee for TAPE and $L50 from the two other cooperative trusts? 

Dr. INIeiiren. No, I don't, sir. That is the truth, that may well have 
happened, but I don't recall it. 

Mr. Weitz. Do you recall, in connection witli this meeting or these 
checks, any discussion of the antitrust suit? 

Dr. Mehren. No, sir. 

yiv. Weitz. Who was to provide the names of the committees or 
recipients of these funds? 

Dr. Mehren. I^nfortunately, I can't answer that either. 

Mr. Weitz. Was it to be Mr. Kalmbach ? 

Dr. Mehren. Not to my knowledge. 

Mr. Weitz. Or representatives of his? 

Dr. Mehren. Not to my knowledge. 

Mr. Weitz. Do you know how the checks came to be voided, each 
check T might add is mai'ked voided across the face. 

Di". ]\fEHREN. T do not know from i-ecollection. I know ver}' well 
those checks would not have l>een voided unless I said that they would 
be voided. Those were my instructions in the office. 

Mr. Weitz. Do you remember talking to yir. Kalmbach on or about 
the 4th of April 1972 ? 

Dr. Mehren. I know that I have been told fi'om sources that I be- 
lieve a call was placed at my house and in truth I do not recall it. I 



7285 

have also asked others in my household. It was the night that this man 
collapsed and I had to carry him upstairs to bed. 

Mr. Weitz. You have alluded to it and let me, for the record, state 
that we do have an affidavit from both the Kepublican National Com- 
mittee and the appropriate telephone company sources in Texas which 
indicate that — which shoAv that on April 4, Herb Kalmbacli did place 
a call and charged it to an RNC credit card number to your home. 

Dr. Meiiren. And it was received ? 

Mr. Weitz. Yes, it was received. 

Dr. Mehrex. Do you know how long the conversation was? There 
is this possibility, and I am just asking that as a possibility, has that 
been checked? 

Mr. Weitz. They don't have records. It was at least several minutes. 
It would be impossible to tell Avhat the conversation was obviously or 
to whom the pereon was talking. 

Dr. ISIehren. Yes. 

Mr. Weitz. But you have no recollection of that? 

Dr. Mehren. Xo', I don't. I wish very deeply I did. 

Mr. Weitz. Now, if someone who was a participant at the meeting on 
the 4th with you in your office, or at least listed as a participant at that 
meeting, had a recollection that there were calls placed to Mr. Jacob- 
sen by Mr. Nelson, calls were received back from INIr. Jacobsen and the 
substance of the discussion was that the contributions were to be made 
and Mr. Kalmbach Avas to provide the names of the recipients of the 
contribution and you insisted upon talking with Mr. Kalmbach for 
the purpose of exploring the possibility or making sure that, in fact, 
easy treatment would be accorded to AMPI with respect to the anti- 
trust suit. Would that be consistent with your recollection? 

Dr. Mehrex. No, it would be totally inconsistent in this one respect 
at least. It is not my way of ever, first, out of common morals, and 
second, out of common intelligence, to say to anybody that in return 
for a contribution I expect intervention in a lawsuit, no. 

Mr. Weffz. What about the commitment itself, apart from any sub- 
stantive fallout from a contribution? We have talked about it today 
and you have testified to a number of meetings, some other meetings or 
meetings were held without your knowledge by others associated with 
AMPI or formerly associated with AMPI. If there had been a com- 
mitment on the part of someone or a concern on your part that a 
commitment had been made not to your knowledge and prior to your 
tenure, do you recall ever expressing on or around the time of 
April 4, 1972, or any other time the desire to communicate to Mr. 
Kalmbach that, in fact, contributions would be made and that he 
should be aware of the fact tliat you were not going to breach or welsh 
on any commitment that had been made prior to your tenure? 

Dr. Mehren. No, I don't, sir. I find it very difficult to encompass 
logically the sequence. If, in fact, the discussion with Mr. Kalmbach to 
which we referred to this morning as to why it occurred on March 16, 
I would find it very hard to put together pressure from Mr. Kalmbach 
to take money on April 4. 

Mr. Weitz. What about if it took place after April 7 or after April 4 
as vou had reason to believe, would that change your testimony ? 

Dr. Mehren. Well, we would at least not have the inconsistency in 
the sequence I think you have built through your questioning this 



7286 

morning that the March 16 meeting in which Mr. Kalmbach said he 
would no longer solicit funds and apparent effort on the part of some- 
body to get those funds. 

Mr. Weitz. Did anybody counsel you either in connection with the 
April 4 meeting or otherwise to go ahead and try to make contri- 
butions so as to appear, still appear, as strong supporters of the Presi- 
dent for whatever benefits that might accrue ? 

Dr. Mehren. I recall no such 

Mr. WErrz. Mr. Jacobsen made no such recommendation? 
Dr. Mehren. Not to my recollection. Mr. Jacobsen, looking back 
now, was obviously involved in every contact involving solicitation 
or possible contributions to the Democrats or to the Republican Party. 
Every one of them. Why, I still do not know. I would like to know why. 
I would also like to know why — here it would be most helpful to me 
in developing a better recollection than I have of this unfortunate 
situation — why, in fact, they didn't get the money, and they didn't. 
I obviously, alone, could have voided these things. 

Mr. Heininger. For the record, we checked it with Lynn and the 
word "void" is in Elrod's handAvriting and his recollection is that they 
were voided either the next day or the following day. 
Mr. Weitz. At Dr. Mehren's instructions ? 

Dr. Mehren. It could not have been at anybody else's. I am trying to 
help, really I am. The next day would be most doubtful because the 
next day was probably the most difficult and tense day I have had in 
tenure at the office. This is the day I had to go up and get the board of 
director of Mid-States region to breach a valid contract and add 50 
percent to the contribution cost. This was the critical transitional 
activity that I had worked on for many, many days in advance and 
I think perhaps the mitigation or the excuse that I don't have memory 
is that this one was by far the important thing for me to do. 

Mr. Weitz. Do you know why Bob Isham formally resigned as 
treasurer of TAPE on April 4, 1972 ? 

Dr. Mehren. Bob Isham merely resigned as treasurer of TAPE 
which he had asked me in the beginning of my tenure to do as soon as 
possible. He also submitted a rather remarkable letter of resignation 
from AMPI on April 4, 1972, despite the fact that ho ultimately re- 
signed on June ?>0, 1972. 1 think I have given that to vou. 
Mr. Heininger. June 30, 1973. 
Dr. Mehren. Right. 

Mr. Weitz. First of all, as I understand it, wasn't Mr. Isham from 
April of 1972 to the end of June 1972 a consultant and he became an 
associate ? 

Dr. Mehren. No, no. His — the rather strange resignation paper 
which was somewhat laudatory in tone, I might add, was never shoAvn 
to me until after his departure.' 

Mr. Weitz. What was his status from April 4 to June 30, 1972 ? 
Dr. Mehren. An associate general manager. 
Mr. Weitz. In June of 1972 ? 

Dr. Mehren. That is cori-ect, that resignation was never shown to 
me until after the departure in June of 1973 and his title, liis status was 
never changed. In fact, I did not know that the resignation from 
AMPI was on file, in his personal file until after his departure, well 
after it. 



7287 

Mr. Weitz. Didn't you tell him if lie resigned he had to resign from 
AMPI? 

Dr. Mehren. I did not ever. I took every effort and so did many 
other people to retain him. Bob Isham talked resignation from TAPE 
from the very beginning. In fact, before my tenure and to this I took no 
exception at all. 

Mr. Weitz. He did not talk to you about it, you weren't general 
manager at the beginning of TAPE. 

Dr. Mehren. Oh yes, I think Bob Isham had said, long before I 
became general manager, that he wanted not to be associated with a 
TAPE activity and he wanted to be detached from that responsibility 
as soon as possible. 

Mr. Weitz. Now, when you became general manager in 1972 and 
through April of 1972, didn't you repeatedly tell him that you felt 
you were going to ultimately contribute to the President? 

Dr. Mehren. No, I don't think so. I told him that there were obvious 
pressures on us, but whether we ultimately would be required to con- 
tribute, no. 

Mr. Weitz. Not required from a legal sense, but you felt the pres- 
sure was great and you would probably have to contribute as a prac- 
tical matter. 

Dr. Mehren. I have told him and I have told Mr. Heininger and 
told others there Avas obvious pressure on us to obtain it. 

Mr. Weitz. What was it ? 

Dr. Mehren. The pressure obviously was the Kalmbach contact to 
start with and then these sporadic matters of this sort. 

Mr. AVeitz. No, I don't understand. You met twice with Kalmbach, 
the first time it was in general terms, he asked for no sj^ecific matters 
and you made no commitment and he asked for no commitments. The 
second time was a brief meeting in which he announced to you that he 
was going to seek no further moneys from you. 

Dr. Mehren. And in between those there were two or three phone 
calls which I did not take. 

Mr. Weitz. And this matter on April 4, you don't connect that in 
any way to Mr. Kalmbach from your own recollection. What type of 
pressure were you under ? 

Dr. Mehren. I was under pressure obviously from Jacobsen and 
Nelson. 

Mr. Weitz. And at no time did you pursue the matter with them, 
as to exactly what type of commitment they had made that made them 
so desirous? 

Dr. Mehren. I iiad, I told you that. I did not ever ask Jacobsen 
explicitly I think, but I certainly asked Nelson if there were any 
commitments vre had to meet. If he said yes, I told you earlier, I would 
not have been disturbed, I would have made the same resolution of it 
that I made of many other commitments I inherited from him. But he 
never told me there was any commitment for 1972 ever. 

Mr. Weitz. For the President without regard to when it was made 
or what time it was to be delivered ? 

Dr. Mehren. Correct. 

Mr. Weitz. Turning your attention to October 1972, between April 
4 of 1972, which at least we have a record of a contact of a call from 
Mr. Kalmbach to your home. 



7288 

Dr. Mehren. May I go off the record ? 

Mr. Weitz. Yes. 

[Discussion off the record.] 

Mr. Weitz. All right, back on the record. 

Do you have any recollection of Mr. Kalmbach, either directly or 
through some intermediary, telling you that he didn't want those 
contributions to come in just prior to April 7 ? 

Dr. Mehren. I do not. But that means merely I have no recollection 
and my recollection is so faulty on the matter of the 30 checks that I 
do not say that this did not happen. 

Mr. Weitz. All right. 

Dr. Meiirex. But 1 do want on the record whatever it was they 
weren't paid and records were kept. 

Mr. Weitz. And now, directing your attention to October 1972, be- 
tween — fii-st of all as to the interim period from April 4, 1972, and 
October 1972, did you have any additional contact again directly or 
through intermediaries with Republican fundraisers^ 

Off the record. 

[Discussion off the record.] 

Mr. Weitz. Back on the record. 

Dr. Meiirex. The answer is, I can't think of any, Alan, which again 
doesn't mean that there weren't. 

Mr. Weitz. I think I asked the question and you said to your recol- 
lection, no intermediary contacts were made. 

Dr. Meiirex. Correct. 

Mr. Weitz. Did Mr. Jacobsen, at any time, renew the matter — or 
Mr. Nelson — with respect to making contributions at sometime prior 
to the election? 

Dr. Meiirex. Yes, he did. INIr. Jacobsen did. 

Mr. Weitz. Mr. Jacobsen did ? 

Dr. Meiirex. Yes. 

Mr. Weitz. What was that in connection with ? 

Dr. Meiirex. That was a telephone call that Mr. Nunn wanted to 
see me and talk to me about the contributions. 

Mr. Weitz. Was this shortly before the time you actually met vrith 
Mr. Nunn? 

Dr. Meiirex. I think it was in the same week. As I recall, Alan, it 
was a Saturday morning. I am almost certain it was a Saturday morn- 
ing that I saw Mr. Nunn and the reason I recall it was that there was 
no other time to see him. 

Mr. Weitz. Was that October 21, 1972 ? 

Dr. Meiirex. I believe it was, yes. 

Mr. Weitz. So Mr. Jacobsen's call would have been the week 
preceding ? 

Dr. Meiirex. It was that same weekend as I recall, yes. 

Mr. Weitz. That was the first contact that you recall renewing the 
subject of contributions by Mr. Jacobsen to you ? 

Dr. Meiirex. Yes. 

Mr. Weitz. What was the substance of Mr. Jacobsen's phone call? 

Dr. Meiirex. The substance of his phone call — he said this was Mr. 
Nunn who had become the major fundraiser of the Committee To 
Re-Elect the President and that Mr. Nunn had expressed a wish to 
talk to me. 



7289 

Mr. Weitz. Was it your understanding that he had essentially taken 
over much of Mr. Kalmbach's activities or responsibilities ? 

Dr. Mehrex. I think Mr. Jacobsen indicated that to me. May I also 
say in the conversation with Mr. Nunn, virtually, he explicitly said 
the same thing. 

Mr. Weitz. I see. At the time of the call by Mr. Jacobsen, did you, 
either in your own mind or expressly to Mr. Jacobsen, raise the ques- 
tion — well, in light of the message with Mr. Kalmbach in which he 
had made explicit to you several montlis previously, did you ask him 
what the need was to meet Mr. Nunn again or meet the Republican 
f midraiser ? 

Dr. Mehren. No, I did something else in response to the puzzlement 
that this sequence engendered in my mind. I did something quite 
different. 

Mr. Weitz. What is that ? 

Dr. Mehren. I decided to avail of the advice of politically expe- 
rienced persons whom I respected highly. 

Mr. Weitz. That was former President Johnson. 

Dr. Mepiren. Former President Johnson. 

Mr. Weitz. That was after the meeting ? 

Dr. Mehren. No, no, I made the arrangements prior to the meeting. 

Mr. Weitz. Did you consult with the former President before? 

Dr. Mehren. No, I consulted with the former President within 30 
or 40 minutes after the departure of Mr. Nunn. 

Mr. Weitz. That was after. 

Dr. Mehren. Yes, but I made the arrangements with him before. 

Mr. Weitz. You decided to meet with Mr. Nunn and then President 
Johnson ? 

Dr. Mehren. Yes. 

Mr. Weitz. Could you tell me why you decided to do those two in 
the sequence that you did ? 

Dr. Mehren. Yes, because again as I looked back by the 21st of Octo- 
ber, I had become aware of a remarkable coincidence of the name of 
Jake Jacobsen in virtually every overture with respect to funds for 
the reelection of the President, President Nixon. I did not feel com- 
fortable with Mr. Jacobsen. I saw no reason to exj)lore with Mr. Jacob- 
sen his role in the generation of these contacts. I think, looking back 
that the major issue in my mind was not as I told you before, whether 
a contribution affirmatively would engender favorable action from the 
administration, but whether refusal to discuss soliciting contributions 
and perhaps the refusal to make one after consultation with my people 
might engender adverse action. 

I was puzzled also, as you imply in your question, as to why this 
would be reopened at this stage. I was puzzled enough that truly being 
totally inexperienced, I have never raised campaign funds in my life 
before or had anything to do with it prior to January 12, 1972, there- 
fore, it was something of a novice to me in the mechanisms of these 
things. I made a decision to avail the opinions of a man whom I re- 
spected and as I repeat, I made that well before, 2 or 3 days before. I 
think it would also be useful for your record purposes, again if I am 
too discursive tell me. I called or told the pilot, Mr. Johnson's pilot 
and my pilot, to please tell the President I had a matter of some im- 
portance I would like to discuss with him. The President called me 



7290 

at my home about 6 :30, I •would think, perhaps on Thursday of that 
week and I told him what the issue was, and the meeting had been 
scheduled with Mr. Numi. I was reasonably certain that Mr. Nunn 
was going to suggest contributions that I had had assurances that 
they would not. I did have on the record, as you have seen, formal 
resolution of the governing committee for the Committee for TxVPE 
that no contributions would be made to the President. In the face of 
this oncoming President Nixon 

Mr. Heininger. Or any other President. 

Dr. Mehren. Or any other Presidential candidate. In the face of 
this, I was reasonably assured that there might be pressures in Avhich 
my own experience would be inadequate to make full judginent and, 
therefore, I decided to talk to Mr. Johnson and after the talk with Mr. 
Johnson to discuss the matter with my colleagues on the committee 
and report. 

Mr. Weitz. Let's take this in sequence. I would like to show you 
for the record and this is to identify, I am not going to introduce the 
whole document. The document is the minutes for the Conunittee on 
TAPE of October 11, 1972. Since most of the document refers to con- 
gressional contributions and other mattei-s outside of the conmiit- 
tee's mandate, I will not include that. I will include the paragraph be- 
ginning at the bottom of the page, page 5 and excise the rest and mark 
it as exhibit 3 for the record and ask you to identify the document. 

[^Vliereupon, the document referred to was marked Mehren ex- 
hibit No. 3, for identification.*] 

Dr. Mehren. I have seen this. 

Mr. Weitz. Now, according to this paragraph and the resolution 
in it 

Mr. Heininger. Did you say Committee for TAPE ? 

Mr. Weitz. That is what it says. 

Mr. Heininger. OK, I just wanted to be sure. 

Mr. Weitz. The minutes in the Committee for TAPE meeting, 
October 11, 1972, held in Minneapolis — as indicated in exhibit 3, 
there was a request for contributions to President Nixon's campaign 
without any to Senator McGovenrs by an AMPI member, and as a 
result the resolution was passed that the committee agi'eed not to 
contribute to either Presidential candidate but to contribute $100,000 
in four parts, $25,000 each, to the Eepublican and Democratic sena- 
torial and congressional campaign committees. 

Dr. Mehren. Yes. 

Mr. Weitz. Now, this was 10 days before the meeting which you 
held with Mr. Nunn ? 

Dr. Mehren. Yes. 

Mr. Weitz. And I take it that it was 4 to 5 days before Mr. Jacob- 
sen's call of the week of the 21st ? 

Dr. Mehren. Yes. 

Mr. Weitz. And now, when Mr. Jacobsen called you in light of the 
existing resolution for the Committee of TAPE, in a sense binding 
your hands in terms of contributions to the President's campaign, why 
"didn't you just tell Mr. Jacobsen to tell him, although you Avould like 
to accommodate Mr. Nunn, the committee had made a "decision and it 
Avas out of your hands and to pass the message along as courteously 
as possible to Mr. Nunn ? 

*See p. 7353. 



7291 

Dr. Mehren. I had two reasons. One, that always in any position 
I have had, I tried to listen to any person of appropriate status and 
position who wanted to talk to me about anything. 

Secondly, here to use the patois that has become fairly common, I 
knew who Nunn was and one doesn't lightly say to Lee Nunn or Herb 
Kalmbach, "I won't talk to you." 

Mr. Weitz. So you thought essentially what you had to tell him 
that you probably had to see him in person ? 

Dr. INIehrex. I wanted to tell him in person and as gentle as I could, 
and I wanted to know what he wanted, specifically what he wanted. 

Mr. Weitz. Didn't Jacobsen tell you what he wanted essentially or 
what he probably would want ? 

Dr. Mehren. Jake didn't have to tell me. I don't really recall if he 
told me. But by that time, I had become sufficiently sophisticated in 
this kind of matter to know who Lee Nunn was. 

Mr. Weitz. Did Jake, again at that tinie, take the opportunity to 
urge contributions be made ? 

Dr. Mehren. I think that Jake did not urge that contributions be 
made. I think that Jake said that Democrats for Nixon would be an 
excellent vehicle if we decided to. 

Mr. Weitz. Was this the first time that he mentioned the Democrats 
for Nixon as a possible recipient for dairy contributions? 

Dr. Mehren. I am not sure, but I don't think it was. By that time, I 
Avas also aware that Mr. Jacobsen was a very active person in the Dem- 
ocrats for Nixon. 

Mr. Weitz. As with Mr. Connally ? 

Dr. Mepiren. Yes. 

Mr. Weitz. Now, again, in view of the fact that — even given the 
fact rather that you wanted to be as courteous and gentle as possible 
with ]\Ir. Nunn, given the fact that you already had this I'esolution by 
the TAPE Committee, why did you feel it necessary to call upon or 
arrange for counsel with Mr. Johnson ? 

Dr. ]Mehren. Again, his experience was such that I knew I could 
get advice from the President and I knew it would be advice based 
upon experience vastly broader than mine. 

Mr. Weitz. Can you tell me this, while you viewed the situation 
sufficiently differently from that in the winter and spring of 1972, when 
you also had contact with Republican fundraisers in the person of 
Mr. Kalmbach, so that you did not call upon President Jolmson's 
counsel then, but did in October of that year ? 

Dr. Mehren. I tliink, basically, I had to go back and reconstruct, 
which is difficult to do. I tliink, basically, it was the inconsistency of 
an apparent termination of solicitation and a renewal thereof that was 
disturbing to me. I susj^ect in the back of my mind really thei-e was a 
question, looking at the overall 40,000 quite decent people working on 
farms, what was his opinion as to going back to the TAPE Committee, 
which I could, of couree, do and I think in this circumstance we ought 
to do it. 

Mr. Weitz. Let me ask you two questions in that connection. First 
of all, the second meeting with Mr. Kalmbach, before that took place, 
for all you knew he was not going to cut off funds. He was going to 
make a second clarification or reaffirmation of tlie solicitation. 

Dr. Mehren. Yes. 



7292 

Mr. Weitz. Why didn't that precipitate a contact to Mr. Johnson ? 

Dr. IMehrex. Again, there was not 

Mr. "Weitz. Before the cutoff. 

Dr. Meiirex. Before the cutotF. The request to meet with Mr. Kalm- 
bach came on the day, whatever it was that I met witli him, and it 
would have been quite impossible to consult with the President. Be- 
sides, I wasn't as battle-scarred in INIarch, March IG, as I was by Oc- 
tober. 

Mr. Weitz. Now, in October, didn't your reason for — in October, 
this was prior to the election, of course, did Mr. Connally's prior ad- 
vice in March or April of 1972, to wait later on just before the elec- 
tion when they would need it more, meaning the President's campaign 
effort. Did the fact that he had given you that advice play any part 
in your decision to speak to Mr. Johnson? 

l)r. Mehren. No; I honestly say that I did not put together the 
rather casual statement of Mr. Connally with respect to the timing of 
any potential contributions with the appearances of Lee Nunn. de- 
spite the fact that the genesis of the appointment was Jake Jacobsen 
Avhom I knew to be associated with Connally. 

]\Ir. Weitz. My question now is, did Mr. Connally's comment and 
his previous association with President Johnson lead you to contact 
President Johnson ? 

Dr. INIehrex. No. 

Mr. Weitz. It did not? 

Dr. ]Meiirex. No ; it did not occur to me. Let me say again that I re- 
spected, unlike many other people in this country, I got to know 
the President pretty well, particularly after he left office and I did 
respect him and I do respect him. I am speaking very carefully about 
him. 

Mr. Weitz. You have had a longstanding relation with him? 

Dr. Meiirex. It became much more intimate after my departing 
from office and his, than before. 

Mr. Weitz. Did you in fact take other occasions to consult with him 
and seek counsel ? 

' Dr. Mehrex. This is the first matter of real importance about which 
I disturbed the President. 

]\Ir. Weitz. All right, we will get back to that meeting. Let's ad- 
dress ourselves to the meeting of Mr. Nunn on the morning of the 
21st. Could you tell us the substance of the meeting, of what Mr. Nunn 
said and so forth ? 

Dr. Meiirex. I think I can give it to you seriatim and with substan- 
tial accuracy. He first advised me that he was Lee Nunn and he ad- 
vised me also his brother, Louis Nunn, who was a former Governoi- 
of Kentucky, was a candidate for the Senate at the time. I believe the 
next major point that Mi-. Nunn made was that he had long been a 
fundraiser for the Republican Party. 

Mr. Weitz. I am sorry. Let's go off the record. 

[Discussion off the record.] 

Mr. Weitz. Back on the record. Do you remember tlie question? 

Dr. ]\Ieiirex. You were asking me the sequence. I recall him say- 
ing that during his career, he had probably raised something between 
$50 and $60 million for the Republican Party. And then, quite ex- 
l)licitly, he asked if we would consider a contribution to the campaign. 

Mr. Weitz. In what form, to what recipient ? 



7293 

Dr. Meiiren. He suggested two ways. One was to the President of 
tlie United States and the other was Democrats for Nixon. 

Mr. Weitz. Didn't he — did he mention a figure by the way? 

Dr. Mehren. There is in my mind a statement — I think it's ac- 
curate that at one stage quite late in the 45 minutes I spoke to him, he 
said something, "Well, we had thought about $650,000 from you." 
But again there was no direct statement that we would like $650 or 
any other figure. 

Mr. Weitz. Do you attach any significance to the fact that in the 
White House memos, as late as February of 1972, there was a goal 
figure set of the remaining $750,000 on the $1 million commitment 
from the dairy co-ops to Mr. Nunn's suggestion of a $650,000 
contribution ? 

Mr. Heininger. I think you will have to back that up with him. 

Mr. Weitz. Let me take it one at a time. 

In February 1972, if there was a memo from one White House aide 
to another referring to the fact that approximately $14 million had 
been received from the dairy people and another $3/^ million was go- 
ing to come in prior to April 7, you attach any significance to the fact 
that in October 1972, Nunn mentioned a figure of $650,000 that he had 
thought you might contribute ? 

Dr. Mehren. I didn't at the time, Alan. I am not sure I would now. 
I didn't at the time. 

Mr. Weitz. Didn't he, in fact, relate it back to prior meetings, com- 
mitments, conversations, solicitations with Mr. Kalmbach and other 
fundraisers ? 

Dr. ]Meiiren. He did not to my memory. 

]Mr. Weitz. Did you refer to that meeting or those meetings with 
him at all ? 

Dr. Mehren. I don't think so. I may well have, but I am not certain. 

Mr. Weitz. Wliy not? 

Dr. Mehren. Why not what ? 

Mr. Weitz. Why didn't you tell him that you were in contact with 
Mr. Kalmbach last spring? 

Dr. Mehren. I think I told him prior to any discussions there maj 
have been, I merely tell you that I don't recall it. We had the resolu- 
tion not to contribute to the President. I told him most unecjuivocally 
that I was certain my colleagues would not acquiesce in a contribu- 
tion to Democrats for Nixon and I told him this rather quickly in the 
conversation. 

Mr. Weitz. What about to the President through the finance com- 
mittee ? 

Dr. Mehren. I am not sure that came out. 

Mr. Weitz. He didn't suggest to the Finance Committee To Re-Elect 
the President? 

Dr. Mehren. He made two proposals. I am not sure whether it was 
Finance Committee To Ke-Elect the President. It certainly was not to 
the Republican National Committee. I am certain of that. 

Mr. Weitz. It was not? 

Dr. Mehren. No ; because the tone of it w-as such that it Avould go to 
the Committee To Re-Elect. But I don't think there was any explicit 
rstatement by him to channels which it would go other than positing 
the alternative of Democrats for Nixon. 



7294 

Mr. Weitz. An alternative to what ? 

Dr. Mehren. a contribution to the President. When I told him we 
had decided that we would not make a direct contribution to either 
candidate 

Mr. Weitz. So it is fair to say his first request or his normal request 
would have been moneys to the President through normal channels such 
as the finance committee and an alternative he thought you might feel 
more comfortable with and he suggested Democrats for Nixon? 

Dr. Mehren. Yes ; he did. 

Mr. Weitz. It may have been in that sequence and tow^ard the end 
of the conA ersation — why did he wait until towards the end of the con- 
versation to speak of $650,000 if this other discussion took place at the 
outset ? 

Dr. Mehren. I am not sure it was at the end of the convei*sation. 
Sometime during the conversation, 

Mr. Weitz. Sometime during the conversation ? 

Dr. ISIeiiren. I do recall his saying we sort of — he put it this way, 
we sort of were thinking about $650,000. He didn't say we have writ- 
ten you down for that or anything explicit as that, but he was sort of 
thinking about that much for you. 

Mr. Weitz. Did he indicate who "we" were? 

Dr. Meiiren. Yes ; he and his colleagues. 

Mr. Weitz. Did he say he talked to Mr. Kalmbach or taken over Mr. 
Kalmbach's areas of responsibilities? 

Dr. Meiiren. I believe he said early in the conversation, after he told 
me who he was, what his experience had been, wliat achievements he 
liad made, that he was in effect replacing — had replaced Mr. Kalm- 
bach as the major or a large fund collector. 

Mr. Weitz. Now, here was, as you indicated, an important gentle- 
man who you didn't want to treat lightly. You wanted to treat him as 
courteous as possible. 

Dr. Meiiren. I didn't want to put myself or the people whom I 
represented in the position of any arbitrary "No, I will not talk to 
you." 

Mr. Weitz. Precisely. And you had not only a resolution from 
your own people which was self-generated, that is generated pri- 
vately through the dairy co-ops and trust 

Dr. Meiiren. No ; that resolution was generated by me. 

Mr. Weitz. It was not generated by tlie Republican fundraiser? 
That is my point. It was generated in your organization. You not 
only had that but you also did not have 

Mr. Heininger. Excuse me, I want to get this straightened out. I 
think if you got something in your question that he may have said 
"yes" as an answer to, and that was contributions of commitments, 
I think lie said by other dairv trusts and I think as far as we know, it 
was only TAPE. 

Dr. Meiiren. I don't think he referred to the others, Alan. I have 
no recollection of it anyAvay. 

Mr. Weitz. Now, you not only 

Dr. Meiiren. Although, if I may say, it's very obvious now that 
he did contact tlie others because the others did make contributions. 

Mr. Weitz. You not only had the resolution of October 11, as a 
reason perhaps not to give. JDidn't you also have his own predecessor's 



7295 

express statement to you that they were not going to ask you for any 
more contributions? 

Dr. Mehren. I may have discussed this with him. I don't recollect 
it. 

Mr. Weitz. Wouldn't that have been more forceful and a more 
exculpatory reason not to contribute ? 

Dr. Mehren. I told him that neither one of those was open to us. 
Whether I mentioned — I rather think that I probably did tell him 
that I had an earlier discussion with Mr. Kalmbach at which he said 
no representations would be made. But the fact is, I told him that 
we could not, and on this one I was reasonably firm because I quite 
firmly believe we could not, in terms of civil public decency as well as 
our own self-interest, make a contribution to any Presidential 
candidate. 

Mr. Weitz. Now, after he mentioned these two alternatives and 
mentioned at some point in the conversation the $650,000, and you 
responded with respect to your resolution, did he make any additional 
offei"s or suggestions ? 

Dr. Mbhrbn. Not that I know of. I did tell him that we had agreed 
that we would make contributions to the committees. 

Mr. Weitz. To the congressional committees? 

Dr. Mehren. Yes. 

Mr. Weitz. Didn't he then ask you to increase those contributions? 

Dr. Mehren. No, sir. That was done frankly on the recommendation 
of the President, and after consultation with my colleagues, because 
among other things, we could not contribute to a President directly 
or indirectly. We also had far more funds at that time that could be 
effectively used on individual candidates for the House and Senate 
or gubernatorial races. This was a decision that had been made at the 
$100,000 level, and after my discussions with the President, it seemed 
to me it would be a reasonable procedure, and I therefore placed it 
l)efore my colleagues who concurred that we would make larger con- 
tributions. We made them in part for the simple reason that the 
Pr-esident suggested to me, and I think properly that a competent can- 
didate for the Presidency could benefit from congressional campaign 
committees, without putting himself or us in the position of a direct 
political contribution, which w^ould probably generate another prop- 
aganda splurge. 

Mr. Weitz. Now, without regard to whether or not you made the 
decision leased on Mr. Nunn's request, did not, in fact, Mr. Nunn ask 
you to increase the contribution and did not, in fact, he tell you that 
the President could benefit from that contribution ? 

Dr. Mehren. I don't think so. 

Mr. Weitz. Didn't you tell him that you might consider increasing 
the congressional contribution? 

Dr. Mehren. I don't recollex't it. 

Mr. Heininger. There is one thing that ought to go into the mix, 
I don't think he has gotten it in any of his depositions and that w^as 
the problem of reasonable equalization. 

Di-. Mehren. That also came up. 

Mr. Weitz. I am limiting myself to Mr. Nmin's remarks. 

Dr. Mehren. No, on that one, for the record, and I think Alan will 
get to it later, that was a suggestion from Mr. Johnson Avhich I placed 
before our colleagues and they concurred. 



7296 

Mr, Weitz. Let's go off the record. 
[Discussion off the record.] 

Mr. Weitz. Back on the record. 

Now, after 3^011 infonned Mr. Xunn what you perceived as the pol- 
icy of the TAPE Connnittee and so forth, what was his response? 

Dr. Mehren. Nothing very shocking or startling. I did tell him 
that we were going to go the committee route. 

Mr. Weitz. Wliat committee route ? 

Dr. Mehren. For conmiittees. 

Mr. Weitz. You were going to? 

Dr. Mehren. Yes, I told him basically what is in that packet. 

Mr. Weitz. That had nothing to do with the President. 

Dr. Mehren. I told Mr. Nimn, I do not recall Mr. Nunn responding 
to that statement that, well, a larger contribution would be a benefit 
to both Presidential candidates. As I recall it, Alan, that statement 
came from Mr. Johnson and not from Mr. Nunn. 

Mr. Weitz. Do you recall, without regard to whom it would help, 
the request by Mr. Nunn to increase the contributions ? 

Dr. Mehren. I do not recall. 

Mr. Weitz. Was there anything else of substance that took place at 
that meeting ? 

Dr. Mehren. I think there was one other thing. I did ask him why, 
at this stage of the campaign, he was soliciting funds, and he did 
give me an answer. 

Mr. Weitz. "V\^iat was that answer ? 

Dr. Mehren. I think the answer was : "We are presently $3i^ mil- 
lion" — as I recall the numbers — "in the red, and at the end of the 
campaign we probably will be $10 million." It was one other state- 
ment also that I do recall. 

Mr. Weitz. "Wliat was that statement ? 

Dr. Mehren. That statement was to the effect that while these were 
made with certainly no thought of any return benefit, or any adverse 
action if we didn't it was a fact to tlie donors 

Mr. Weitz. We have gone over that before. 

Dr. Mehren [continuing]. To the donors that the President did 
remember Ms friends wlio had helped him. That was the closest it 
came in my recollection. 

Mr. Weitz. That was in the context of the discussion of contribu- 
tions ? 

Dr. Mehren. Yes. 

Mr. Weitz. Anything else of substance that you can recall from 
the meeting? 

Dr. Mehren. No ; I think I have given you the whole story. 

Mr. Weitz. After Mr. Nunn left, I take it you left with him ; that 
you would not contact him or vice versa. 

Dr. ]\Iehren, I left it with him that I would contact him. 

Mr. Weitz. To what end ? 

Dr. Mehren. And I did. To the end that I would take his sug- 
gestions as I think I properly should, and discuss them with my col- 
leagues. If there were any differences in policy or activities, I would 
so advise him. 

Mr. Weitz. Did you tell him when you would contact him ? 



7297 

Dr. Mehren. No; I told him after I had discussed his request or 
his suggestions with the other members of the TAPE governing com- 
mittee, and also with certain key members of the board, although I 
didn't tell him that — I would call him back and let him know if there 
was any change. 

Mr. Weitz. So to recapitulate, although you told him of the present 
policy, it would not be changed, but you w^ould rather give him the 
courtesy of raising the matter again with your colleagues. 

Dr. INIehren. I told him in effect that I would raise this matter and 
advise my colleagues. He had solicited funds and that if there were 
any difference in the position of our people from that which they 
had expressed earlier and formally enunciated on October 11, 1 would 
so advise him. 

Mr. Weitz. I take it after this meeting with Mr. Nunn that after- 
noon you went to President Johnson's ranch. 

Dr. JVIehren. That morning I had in fact arranged to have the plane 
which we shared with President Johnson available. I think I had it 
available at 9 :30 in the morning or something of that sort. So I drove 
personally from my office, 5 minutes over to the airport and the John- 
son plane was there and I flew out to the ranch from there. 

Mr. Weitz. What was the substance of the discussion with President 
Johnson with respect to these matters ? Obviously, you may have dis- 
cussed other things, but this particular solicitation by Mr. Nunn. 

Dr. Mehren. With respect to these matters, the President almost 
immediately — I told him what this man had said at some stage, when 
he asked me : "Why did they want money ?" I recall saying — well, I can 
tell you what he told me — that he was $31/2 million in the red and that 
it would be $10 million, and I remember the President, w4io was back 
on cigarettes, flipped his cigarette, and said, "Do you really believe 
that?" I responded that he didn't ask me what I believed. He asked me 
what Mr. Nunn had said. He then quite explicitly said, "Is there a 
commitment ?"' and I said, "There is no commitment to my knowledge.'' 
He responded, if there be a commitment, he considered it our obliga- 
tion — not mine personally, the TAPE obligation — and we should meet 
it and I told him, "No, I know of no commitment.*' 

Mr, Weitz. Can I stop you there? Why did he raise the question of 
a commitment? 

Dr. Mehren. Probably because of two things. One, I think the Presi- 
dent functioned always on the basis of commitment. If a commit- 
ment was made, just as most of the other members of the political 
mechanism in this city function, if there was a commitment, we were 
supposed to keep it, or by orderly process to alter it or obliterate it. 
That was one thing. 

The second thing, at one stage in the conversation later, this may be 
one of the reasons he asked me this. He did indicate at some campaign, 
and I would assume 1964, there really couldn't be any other, the dairy 
people that committed $250,000 to his support but not delivered on the 
commitment and he put it aside. 

Mr. Weitz. Now, let me ask you this, particularly if the last com- 
ment you made or have told us he made, was later in the conversation, 
let's get back to the point where you told him of your meeting with 
Nunn. He commented or asked you about the extent of the debt, if any. 



7298 

that Mr. Nunn had recounted to you and you say at that point he then 
said, "Is there a commitment?" My question is, what in the nature of 
the conversation or in the context of the meeting even led to that ques- 
tion ? No one had mentioned a commitment, had they ? 

Dr. Mehren. I think it is a reasonable, very reasonable question for 
the President, in view of the fact that I was over asking his advice, 
to ask me if I or my predecessoi-s had made a promise on this matter. 
I think nothing else would be involved. I think it would be a very 
natural question. 

Mr. Weitz. Had you led him to believe that that in fact was your 
concern that there was some commitment which had been made? 

Dr, Mehren. I had been 

Mr. Weitz. "Wliat did you tell him? 

Dr. Mehren. I told him I knew of no commitments. 

Mr. Weitz. Did you tell him about your earlier meetings with Mr. 
Kalmbach ? 

Dr. Mehren. Yes. 

Mr. Weitz. Did you tell him about the conversations with Mr. Con- 
nally? 

Dr. Mehren. No, I don't think I did. I don't recall. Just a moment, I 
told him about the Kalmbach — and told him this is one of the reasons 
I have come here knowing what it meant to him, knowing that he 
had to give up 3 or 4 hours of his time, that this was a primary reason 
I didn't want to talk to him. 

Mr. Weitz. It was your concern. 

Dr. Mehren. I did not tie it to the Connally matter. See, I didn't take 
the Connally statement as a serious one. You apparently do, but I 
didn't. 

Mr. Weitz. You in fact did at least express your concern, based 
on the repeated conversations with Mr. Kalmbach, ]\Ir. Jacobsen, and 
Mr. Nelson, of some possible commitment of which you had no knowl- 
edge. 

Dr. Mehren. I did not express my concern. He asked me clearly 
whether 

Mr. Weitz. You discussed the possibility of a commitment based on 
the earlier meetings which you also related to him ? 

Dr. INIehren. No; I don't think so. It may well have been; it's very 
difficult, to know what a man who is now deceased — what led him to 
ask the question. I know very well, as accurately as I could, I told him 
what happened before and that may have led him to ask the question : 
"Was there a commitment?" Again, I told him to my best knowledge 
"There is no commitment," and I knew what his answer was. 

Mr. Weitz. There is no commitment but you in fact had a concern ? 

Dr. Mehren, Yes; let me answer your question before you ask it, 
Alan. I had begini to see a sequence about what you asked me once in 
an informal meeting of Jacobsen, and on a periplieral basis, at least, 
Nelson. I kept saying to myself, "Why ? why ? why ? After the Kalm- 
bach matters, wliy would Jacobsen be so persistent in this?" By that 
time it couldn't be reprisal which would be one reasonable explana- 
tion for them going out to Los Angeles on January 13. The second 
hypothesis alternative to reprisal would be for some reason or other 
these people found it necessary to try to get dairy money into the 
Republican campaign. 



7299 

Mr. Weitz. Let's go off the record. 

[Discussion off the record.] 

Mr. Weitz. All right, let's go back on the record. 

Now, after you told the President that to your knowledge — the 
former President — to your knowledge, that there was no commitment, 
what then was the substance of the discussion ? 

Dr. Mehren. From there we went to what kind of fund do you have 
available. I told him something in the neighborhood of $1,300,000 
was there and I also expressed my view and the view which my col- 
leagues concurred in, that for many, many reasons any direct contribu- 
tions to Presidential candidates w^ould be destructive, not to us but 
to many other people. And he concurred in that. I told Mm that we 
had agreed that we would make contributions to the committees and 
it was at this stage, I think, that President Johnson said to me, "Well, 
there is one easy way you can be of assistance to both of them and to 
the electoral process." I think I can give you the detail which had not 
occurred to me because I am not that kind of a pro. He said in effect 
that either Mr. Nixon or Mr. McGovern could avail of contributions 
to the committees without direct contributions to them. And the means 
by which they suggested it had been done, were well known to all 
professionals in the political field. He gave an example, he said that if 
there was a Senator from — a Republican Senator from Massachusetts 
that was rumiing, the committee could allocate part of their funds to 
the support of that Senator's campaign. It would be a very simple 
matter for Mr. Nizon on the Republican side, or Mr. McGovern on 
the other side, to be present — to be invited, and that the Presidential 
committees would not be required to carry any, or at least the bulk 
of the expense. He therefore suggested, and his suggestion I later took 
to my colleagues, that since we had ample funds, since, in fact, he 
agreed that we were for practical purposes precluded from direct 
contributions, nor were we so committed, he suggested that we in- 
crease the — he made two suggestions that when w^e increase the con- 
tributions to the committees, and to give it to them straight and hon- 
estly, no equivocations, and then we try to balance our overall contri- 
butions to both sides. I took up those two suggestions by telephone, 
and other discussions, with my colleagues and they concurred. 

]VIr. Weitz. Was there anything else discussed in connection with that 
matter ? 

Dr. Mehren. Not so much, it was a great deal of personal discussion. 

Mr. Weitz. I am not talking about ])ersonal discussion, I am talking 
about matters related to this. 

Dr. Mehren. I think I have given you the essence of it. 

Mr. Weitz. Did you indicate how much it would take to balance, as 
he put it, of the contributions of both sides ? 

Dr. Mehren. I don't know and I am not sure I know now. It was a 
suggestion that roughly we balance it. I might say my colleagues, 
particularly the president of the association, who is a member of the 
TAPE governing committee had been anxious to balance the con- 
tributions and they were ultimately roughly balanced. 

Mv. Weitz. Now, these two meetings w^e have discussed took 
i)lace on October 21, 1972. The following week did you have an occa- 



7300 

sion to discuss these matters and your decision or recommendations 
with employees of AMPI ? 

Dr. Mehren. I don't know, I may have. I don't know. 

Mr. Weitz. Do you remember discussing this with Bob Isham? 

Dr. Mehren. I don't know, 1 may liave. I certainly wouldn't say 1 
didn't. 

Mr. Weitz. Do you remember discussing it with Bob Lilly? 

Dr. Mehren. No ; it may have been that Lilly would hear from the 
TAPE members. He was by that time the secretary of the TAPE 
Committee and I may have discussed it with him. I don't know. 

Mr. Weitz. How was the decision made to contribute the contribu- 
tions which were made and are a matter of public i"ecx)rd ? 

Dr. Mehren. I think the decisions were made by telephone commu- 
nications. The first to Mr. Griffith who is chairman of the committee 
and operating as active chairman and then either through him or me 
with the other membei-s of the committee and I believe also that they 
probably checked it out with the president, the regional president. 
They normally do. 

Mr. Weitz. After the decision was made to balance out the con- 
tributions and since the record shows the contributions to all four com- 
mittees were substantially greater or somewhat greater in some cases 
and substantially greater in others than the $25,000 original commit- 
ment decision, did you communicate this decision or the amounts that 
would be contributed to Mr. Nunn ? 

Dr. Mehren. Yes, I did. I don't think I gave him the amounts. I 
said we had reached a decision that we would give more but I don't 
think I gave him the amounts. I am not sure those amounts were set. 
Let me, if I may, take a quick look and see. I would think this prob- 
ably was done here on a Saturday and he was present. 

Mr. Weitz. You're talking about Mr. Nunn ? 

Dr. Mehren. Yes; on October 21, probably I made the calls on Mon- 
day and got the discussion going among our people. 

Mr. Weitz. The 23d ? 

Dr. Mehren. I would think so and it would be about the 24th, 25th. 
I think I Avas here in San Antonio the 24th and 25th. The 25th, I was 
in Fond du Lac. It would be sometime in that week that I think I 
called Nunn and told him we were going to i-eaffirm that Ave Avere not 
going to contribute to the President or Democrats for Nixon and Ave 
Avere going to make some increases in contributions to the four com- 
mittees plus the ballots. 

Mr. Weitz. Noav, I have several questions. First of all, I Avould like 
to shoAv jou four exhibits that I Avould like to mark as exhibits 4, 5, 6, 
and 7 to your executive session. 

[Wliereupon, the documents referred to Avere marked Mehren ex- 
hibits Nos. 4, 5, 6, and 7 for identification.*] 

Dr. Mehren. All right. 

Mr. Weitz. Exhibit 4 is an — each of them are actually four docu- 
ments. 

Dr. Mehren. Yes. 

Mr. Weitz. These are copies of a request voucher for TAPE ex- 
penditures, a letter transmitting the contribution, a copy of the check 
and a copy of the receipt from the recipient committee. Exhibit 4 is a 

♦See pp. 7354-7365. 



7301 

package for the $150,000 contribution to the National Republican Sen- 
atorial Campaign Committee. Exhibit No. 5 is the contribution of 
$150,000 to the National Republican Congressional Campaign Com- 
mittee. Similarly, exhibit No. 6, exhibit No. 7, are the contributions, 
tlie first exhibit, No. 6 is the $27,500 to the National Republican Sena- 
torial Campaign Committee and exhibit No. 7 is the $25,000 to the 
National Republican Campaign Committee. 

Dr. Mehren. It's probably the House. 

Mr. Weitz. The Congressional Campaign Committee. Now, are 
these documents relating to those contributions ? 

Dr. Mehren. I don't really know. 

Mr. Weitz. Contributions made to the Republican side that week 
following this meeting with Mr. Nunn and former President Johnson ? 

Dr. Meiiren. Well, they are some kind of voucher and whether 
they're accurate or not, I do not know. 

Mr. Weitz. Underneath, is that your letter for example, the two 
$150,000 contributions have cover letters from you. 

Dr. Mehren. I wrote those letters personally, I remember. 

Mr. Weitz. To the Chairman ? 

Dr. Mehren. Yes. 

Mr. Weitz. And I have several questions with regard to these and 
I think, of course, the record shows that larger contributions than the 
original $25,000 were given to the Democratic — the two Democratic 
committees also. It was somewhat less, $62,500 to the Democratic 
Congressional Campaign Committee and $47,000 to tlie Democratic 
Senatorial Committee. 

Dr. Mehren. Let me give you now and I give you this out of memory 
again. I believe that Mr. INIelvin K. Besemer, who is a member of 
that committee and was then regional president of the northern and 
central region of AMPI made two suggestions. One of them was that 
we give more to the Democratic Congressional Campaign Committee 
than we did to the Senate on the grounds of a consensus among this 
committee that they needed it more over on that side. '\'\%ere they 
got that, I do not know. That was approved by the committee. The sec- 
ond one was with respect to the Democrats, as I recall it, my colleagues 
agreed unlike the transmission to the Republicans, we would tell them 
that Ave would like them to do tAvo things. One to meet certain agree- 
ments, I think it was $7,500 to Congressman Smith, I think, which 
had already been apj^roved by this committee. The second was that 
Mr. Humphrey, Mr. Mills, and Mr. Albert should participate in the 
allocations. 

Mr. Weitz. Did you give any similar instructions on the Republican 
side? 

Dr. Meiirex. No, because it wasn't suggested by the committee 
members. 

Mr. Weitz. Let me ask you several questions now. Exldbit No. 4, and 
No. 6 are the two checks and accompanying vouchers and letters to 
the Republican Senatorial Committee. Now, can you explain why, and 
I believe both checks are dated the same date, October 27. Can you ex- 
plain first of all why there were two checks sent to that committee as 
opposed to one ? 

Dr. Mehrex. I think I asked you, I need to check all through these 
records, I think I asked you to look into it. 



7302 

Mr. Heininger. We can't find it. 

Mr. Weitz. Yon don't know why they were divided into two checks ? 

Dr. Mehren. No, except for this, Alan, Bntterbrodt, especially on 
the committee, felt veiy strongly that this time we should not put our- 
selves in the position apparently that he had felt we had gotten into 
in 1968 of heavily disparate contributions to one party and not to 
the other. 

Mr. Weitz. That Avas not my question. The question I asked was, the 
record shoAvs the contributions that were made to both sides and they 
were substantial. My question is, Avhen you decided to give a total of 
$177,500 to the National Republican Senatorial Campaign Committee, 
why did you divide it into two checks ? 

i)r. Mehren. I don't know, I asked Mr. Heininger to check and I 
don't know whether 

Mr. Heininger. We haven't found anything on that. 

Mr. Weitz. You have no recollection ? 

Dr. Mehren. No, but I do repeat and I would like the record to 
shoAV I asked this question of Mr. Heininger and asked him to find 
the answer for it and I don't know. That is part of this that I did not 
deal with. 

Mr. Weitz. Now, can you also explain why the $150,000 to the Re- 
publican Senatorial Campaign Committee is sent by letter from you 
to the chairman of the committee, whereas the $27,500 contribution is 
sent by Avay of cover letter from Bob Lilly to an employee of the 
committee ? 

Dr. Mehren. T don't think so but I believe they were both cleared by 
the committee but I do not have recollection of the $27,500 from Bob 
Lilly. 

Mr. Weitz. I said, did you have any reason to understand the means 
of sending the two checks to the same committee, apparently on the 
same day? 

Dr. Mehren. Have you got the letter ? 

Mr. Weitz. It's part of the exhibit — exhibit 4 and exhibit 6 are the 
same committee — two different amounts, one from you and one from 
Bob Lilly. Your letter is addressed to the chairman of the committee 
and the other is addressed to an employee of the committee. 

Dr. Mehren. I don't know why. I really don't. I did ask our counsel 
to try to find out. 

Mr. Heininger. The only thing we did find, Alan, Ave have a hand- 
Avritten draft and this is in George's handAvriting of Avhat basically is a 
fomi lettei". 

Dr. Mehren. To all four of them. 

Mr. Heininger. For the big one and Ave could not find anything on 
the little ones. 

Mr. Weitz. NoAv,the letter from you 

Dr. Mehren. You Avant this incidentally ? 

Mr. Weitz. No. The letter from you, and this Avould also apply I 
take it to exhibits 5 and 7 Avhich have the same division of checks and 
the same means of transmission in each case. ]\Ir. Lilly's for the smaller 
amount and yours for the larger amount directed to the chairman. Do 
you ha\^e any explanation for that ? 

Dr. Mehren. I don't really knoAv except I think it came out of the 
balancing request to the other members of the committee, I think. I am 
not certain. 



7303 

Mr. Weitz. That would go to the total amount but not to the means 
of transmission. 

Dr. Mehren. I think that is correct. 

Mr. Heininger. Somebody had to add up all of the numbers. 

Dr. Mehren. Where we were. 

Mr. Weitz. The total amount given to a committee and not to the 
means of transmission or the division of checks. 

Dr. ]\Iehren". My memory is that Lilly was told to balance the total 
contributions, which is one of these documents, and I suspect what he 
did was come to the committee members and say, "In order to roughly 
balance, including gubernatorial and local contributions, we should 
give the following amounts to the Republicans."' I tliink that is what 
happened. 

Mr. Weitz. Do you also have any explanation as to why your letters 
to the two committees are dated October 24? The checks are dated 
October 27 and the receipts in each case are stamped November 2. 

Dr. Mehren. I suppose November 2 was the date they received the 
funds. 

Mr. Weitz. You attach no significance to the three different dates? 

Dr. Mehren. I don't. I never knew about it before. I really didn't 
deal with this. They were delegated and all I did here was write the 
letter and I did concur now in the higher contributions to the Demo- 
cratic congressional committee than to the Senate. I knew about that 
and I do recall that instructions came from the committee to Lilly 
to balance it out. 

Mr. Weitz. But in connection with balancing it out, do you have 
any reason why the two contributions, substantial though they were, 
to the Democratic senatorial and congressional campaign committees, 
were each made by way of one check, whereas the two contributions, 
also substantial, and in fact greater to the senatorial and congres- 
sional Republican campaign committees, were made with a total of 
four checks. Two to each committee. 

Dr. Mehren. I think I have answered that I myself noted this 
anomaly sometime after you and I first talked. I did ask Mr. Heininger 
himself or others on the legal counsel staff to try to find out why that 
was done. 

Mr. Weitz. Weren't the two $150,000 checks to the Republican con- 
gressional and senatorial campaign committees — ^were those not seg- 
mented, both in maimer of transmission and specific check, in order to 
facilitate and identify those contributions as being specifically separate 
and apart to be transmitted forward on behalf of the President? 

Dr. Mehren. No ; not by me. 

Mr. Weitz. Did Mr. Nunn — when you informed him that you 
were, in fact, going to make more substantial contributions to the con- 
gressional committees — did he in any way indicate that those moneys 
would be forwarded, or would be somehow used for the benefit of the 
President ? 

Dr. Mehren. No ; I will give you my best recollection. I told him first 
that we were going to give larger amounts. I do not believe I told him 
what the specifics were. I do not believe that it had been cleared with 
the committee then. As I recall, Nunn's response was that this was 
very good and this would be helpful. But I carefully wrote the letter 
such that these went to the committees. 



7304 

Mr. AYeitz. Now, Dr. Mehren, your best recollection is that you did 
not tell him how much the total contribution would be. Do you recall if 
you indicated it would be at least $100,000 to each committee? 

Dr. Mehrex. I don't know. I told him they would be substantially 
larger, as I recall it, than the original $25,000 that the committee set- 
tled on. 

Mr. Weitz. You do not recall telling him that it would be at 
least 

Dr. Mehren. $300,000. 

Mr. Weitz. $100,000 each. 

Dr. Mehren. I don't recall that ; no. 

Mr. Weitz. Did you consider in the context of your conversations 
Avith ^Ir. Nunn, that had the increase been the 100-percent increase to 
each of the committees— that is $50,000 rather than the $25,000— that 
would have been a substantial increase in the context of the con- 
versation. 

Dr. Mehren. I don't think I gave him the magnitude of the percent- 
age increases. 

Mr. Weitz. I see. Well, let me ask you this. If there is evidence that 
Mr. Nunn notified at least one of the two committees, it's not clear 
whether he notified the other at this point, but if there is evidence that 
he notified one of the two committees that they would be receiving this, 
specifically the senatorial committee, a large sum or perhaps $150,000 
from your committee, the TAPE committee, and that tliey were in turn 
to forward certain moneys on, totaling approximately $100,000, to the 
Kepublican National Committee, could you explain how he knew of 
that transaction ? 

Dr. Mehren. No; I don't think I told him $150,000. I am quite cer- 
tain I didn't. 

Mr. Weitz. Or at least $100,000 ? 

Dr. Mehren. Or $100,000 either, and I certainly did not tell him to 
transmit it on. 

Mr. Weitz. Did lie indicate in some way it would be used for the 
President ? 

. Dr. Mehren. As I recall our conversation when I told him what we 
were going to do in terms of larger contributions, in all four commit- 
tees, I also told him the foniier President had indicated this would be 
of assistance to him in the Presidential side without compounding our 
difficulties or those of the two Presidential candidates. ^Yith that he 
agreed, but there was no slightest reference to any bodily transfer of 
funds to those committees through any other committee because this 
letter is quite explicit in what we said here. I might also say here, and 
I recall, I cleared this letter with counsel to make sure I wasn't getting 
mousetrapped. 

Mr. Weitz. In reference to your convei'sation with Mr. Nunn to the 
suggestion or advice of the former President, that this money could be 
of indirect use, help, assistance, to the President in his 1972 campaign, 
did you or would you then interpret your comments to him as commit- 
ting him to — be or the senatorial committees to make such use of it as 
they saw fit for the benefit of the President ? 

i)r. Mehren. No. 

Mr. Weitz. So that if, in fact, they 

Dr. Mehren. Pardon me, I don't think that is what I said here, is 
it? 



7305 

Mr. Weitz. I am asking you whether you interpret what you said 
in light of that context. 

Dr. Meiiren. I meant to tell him precisely what I wrote here to the 
chairman of the committers — precisely. And if you're implying that I 
said, "Now you can snooker some money out of there to get it in se- 
cret" — no. If I were to do that it would be much better in everybody's 
viewpoint, especially from our own, it would be better t-o just say, 
"Well, we have reconsidered and we will give you some money." 

Mr. Weitz. You have testified that on your own, and based on the 
advice of a number of people whom you respected, it was inopportune 
and perhaps inappropriate to make further contributions to any Presi- 
dential campaign. 

Dr. Mehren. Make any contributions. 

Mr. Weitz. That is right. Such contributions that would compromise 
either your organization or the Presidential candidate. 

Dr. Mehren. Yes. 

Mr. Weitz. Now, if you made contributions to one committee which 
was not associated with the President and it was used for his benefit, 
that would neither compromise the President nor your organiza- 
tion, is that correct ? 

Dr. Mehren. I think I told him explicitly, precisely what Mr. John- 
son said to me, that this would be of indirect benefit to them. It would 
also not compromise anybody. He went further, he told me what a 
professional would do and he gave me some examples. 

Mr. Heininger. This is the President. 

Dr. Meiiren. Former President. 

Mr. Weitz. And you related this to Mr. Nunn ? 

Dr. Mehren. Yes, I think I did. I am not sure. I think I told him 
that the President had indicated that this would be of use to you 
and Mr. McGovern. 

Mr. Weitz. You also indicated you were making substantial con- 
tributions to the Democratic side ? 

Dr. Mehren. I think I told him that, yes. 

Mr. Weitz. Now, the final reporting period before the 1972 elec- 
tion ended, according, then, to existing law, on October 26, 1972. Do 
you have or do you associate any significance, or did you have any 
conversation with anyone with respect to the dating of the check with 
respect to that recording date '? 

Dr. Mehren. No, I don't think I did, because again, that is a part 
of the operation. I didn't handle it. In fact, I didn't know until you 
just asked the question that there was such a provision. 

Mr. Weitz. I asked you before whether you discussed this with 
Mr. Lilly, these contributions, and you said you may have in his ca- 
pacity as secretai-y for the Committee on TAPE. I take it because 
his signature is — and he filled out these vouchers — apparently what 
purports to be his signature is on all four of these exhibits, 4 through 
7, that that would be consistent with your recollection that he in fact, 
at least, was communicating the desire or instruction to make these 
contributions. 

Dr. Mehren. I don't think there was anything covert about these 
contributions to anybody. This went through the office mill, every 
stenographer who had access would see them. 

Mr. Heininger. On November 1, 1972, Lilly submits the report to 
A.MPI's eoT-Dorate board of directoi-s listing the whole business. 



7306 

Mr. Weitz. Let me ask you this, let's take exhibit 5. Bob Lilly 
purports to be his signature, signs it on October 24. The issue date of 
the check he writes is October 27. That is in his instruction and it 
says — someone signs this "per Dr. Mehren, 10/24." So apparently the 
instruction goes out on the 24th. Do you know Avhy the request was 
made for the check to be drawn and dated 3 days later? 

Dr. Mehren. I don't laiow there was a request and I had no knowl- 
edge of any significance of October 27 until you asked me the question. 

Mr. Weitz. So you don't know why the request was made, the check 
was drawn for October 27. 

Dr. Mehren. Were they all drawn on the 27th ? 

Mr. Weitz. They were all dated the 27th, I am not telling you when 
they were drawn. The request was the 24th, all the checks are dated 
the 27th. 

Dr. Mehren. No, I don't know and I am telling you quite explicitly 
that I didn't know that the 27tli was tlie date of any signific<ance. 
Somebody else may have known it, but I didn't. I see no point in that. 
because again on November 1, tlie board was apprised in complete de- 
tail of all contributions. 

Mr. Weitz. I have one other area to cover with you, then Mr. Sand- 
ers can take over. 

One, do you remember conversations with respect to Stuart Rus- 
sell in the first 4 months of 1972 and any outstanding obligations, bills, 
or fees to him ? 

Dr. Mehren. Yes, I certainly do. 

Mr. Weitz. Could you tell us what the nature of those contacts and 
conversations were ? 

Dr. Mehren. I think the first contact I told you about earlier and I 
know I have outlined it in other depositions. The first contact that I 
recall we were in the process of trying to determine oustanding ob- 
ligations of AMPI. It was at this stage and in the presence of John 
Butterbrodt, I might add, that lie first indicated to us that it had been 
his practice to bill AINIPI and give funds to A]\IPI employees for 
the purposes, as I recall, to transmit to other people. The second meet- 
ing, I think, involved — and I can't give you dates, but I think it is 
April 4 — this difficult date that we looked at before. Alan. I think 
it was at that first one that Butterbrodt was present also that tlie man 
said to me that he was in tax difficulty. He had tax obligations that 
there was this commitment and iji fact this business obligation as he 
put it. At one of the meetings I asked him, "What do you think is the 
magnitude of this alleged obligation?" That was probably the first — 
you know more about this than I do. 

Mr. Heininger. I don't know about that. 

Dr. Mehren. He said lie didn't know but at that stage, as I recall, 
said his books were coded and he could find out. I told him in each one 
of the sessions in this matter that there Avas to be no more of this and 
I believe his answer was "Thank God." I told him to go back and look 
at your coded books and come back with a statement as to what you 
believe AINIPI owes you. This is in terms of the obligation made by 
prior management and which has placed you in the position of dis- 
bursement and income tax liability. He came back then and I am not 
sure if it was a meeting which a final resolution was made; it was 
one of them that he told me it was in the neighborhood of $66,000. 



7307 

Then I called in Isham to evaluate the nature of the obligations, the 
magnitude thereof, and one of the meetings, the date of which I can- 
not recall, probably April 4, you were there after supposedly 31/2 hours 
of discussion, Isham came in and said this was an obligation that had 
been made in good faith. It had involved disbursement and liability 
on the part of Kussell. I asked him to discuss it with Mr. Heininger 
and to tell me whether the payment of that would be lawful and his 
answer was "yes." This is another one of the occasions in which I said 
to Mr. Heininger I would be most happy to have him detach Mr. 
Kussell from participation in our affairs at his earliest opportunity. 
I might add that is not the first time I said it. I had said that earlier. 

Mr. Weitz. Didn't Mr. Eussell explain the context or the purpose 
which this obligation had onginated ? 

Dr. Meiiren. Yes ; he said, and I think he has reaffirmed it to others, 
that what he did was to cash checks either for his law firm or himself — 
I guess for himself — and give the money to people, and then it was 
used to pay other people's legal fees. That was his basic statement, as 
I recall. 

Mr. Heininger. I think his deposition testimony is, at least what 
he told me, that this money was for legal fees and expenses according 
to Harold Nelson and he pointed out in his deposition that this is 
a very expensive way of doing it and Nelson said this is the way we 
want to do it. 

Mr. Weitz. Let me show you — I take it as a result of this conversa- 
tion and conversations ultimately in the amount 

INIr. Heininger. I don't think George participated in the conversa- 
tion which I had. 

Mr. Weitz. I am not talking about that but with respect to your 
contacts with Russell in 1972, as a result of that ultimately, approxi- 
mately $66,000 was disbursed to Mr. Russell. 

Dr. Meiiren. Yes, it was. 

Mr. Weitz. And this was in satisfaction of this obligation ? 

Dr. JNIeiiren. And I approved the \'oucher. 

Mr. Weitz. I believe you have seen this before, and I would ask 
you to look at it again. 

Dr. Meiiren. Yes, I have seen this. 

Mr. Weitz. And there, enter this as exhibit 8, which you identified 
by stipulation, a copy of the check to Mr. Russell dated April 18, 1972. 

[Whereupon, the document was marked Mehren exhibit No. 8 for 
identification.*] 

Dr. Meiiren. Yes. 

Mr. Weitz. For $66,821.48 with an attached request for check with 
your initials. 

Mr. Heininger. I Avould like to point out according to Russell's 
deposition, there is a substantial amount of that money which was 
actually legal services. In other words, this was to — it was being 
termed "a global settlement." There were some outstanding bills for 
legal services that were included in there too. 

]Mr. Weitz. Well, I might say on the request for checks which is 
part of exhibit 8, it says advance payment, legal fees, copies of sup- 
porting statements to be forwarded to the home office immediately, 

*See p. 7368. 



7308 

and my understanding of documentation is that all other documenta- 
tion predates April 18 and Mr. Russell was, in fact, paid money in 
May and June 1972 for statements admittedly submitted at that time. 

Dr. Mehren. No ; that is not so. 

Mr. Weitz. Could you provide us with that documentation, please ? 

Mr. Heininger. I can provide you; it's in the deposition with all 
of his invoices, and the way that you can determine what is what, we 
have made an accounting study of it and I will be glad to give that 
much. 

Mr. Weitz. I understand from your accountant that it does not 
equal $66,000 ; you cannot make it come out. 

Mr. Heininger. It was $313-odd that don't come out. 

Mr. Weitz. Could we have that accounting, please ? 

Mr. Heininger. Yes; let me pass that a little bit because we have 
withheld it so far as work product. It was done for us. I want to check 
and see whether we're going to turn it over to the plaintiffs and if 
we are, I will be glad to give you that. 

Mr. Weitz. In advance of that, could we have the underlying docu- 
ments or voucliere, submitted— or invoices submitted, I should say ? 

Mr. Heininger. With respect to what we show in our voucher file 
with respect to this check, no problem. 

Mr. Weitz. No problem. This would be invoices from Mr. Russell ? 

Dr. Mehren. Yes. 

Mr. Weitz. Now, whether or not they were covered by invoices, Mr. 
Russell's contact with you was in the context of prior obligations for 
payments to attorneys. 

Dr. Mehren. For three things. 

Mr. Weitz. And expenses. 

Dr. Mehren. No; services performed by him for which he hadn't 
been paid, disbureements he had made to allegedly other attorneys, and 
the tax liability that he had incurred in that process. That is correct, 
is it not ? 

Mr. Weitz. For the payments of other attorneys. 

Dr. Mehren. Let me say this : I did there what I would do again. 
This is a matter I didn't like and I told you before and I will say it for 
the record, from the beginning I made evei'y effort I could to terminate 
the association of Stuart Russell with AMPI for reasons quite exterior 
to this. I did not like this and I told him so. He so admitted under oath. 
Furthermore, though, I did what I would have to do again, I think. 
I would have to place confidence in the comptroller or not place con- 
fidence in the comptroller. At that time, I had total and unfettered con- 
fidence in the comptroller and I asked him to determine for me the 
legitimacy of this obligation and the magnitude thereof and I asked 
my counsel with whom I make bad jokes occasionally but whose in- 
tegrity I respect totally to tell me whether this was a lawful outlay. 

Mr. Weitz. Did you 

Dr. Mehren. Let me just finish this if I may, Alan. I had no alter- 
native now in an operation of a magnitude of this size, other than to 
go to people like Bob Isliam and ISIr. Heininger and ask those ques- 
tions. First, to have them tell me if it is legitimate and accurate, and 
secondly, a lawful disbursement; and if their answer is in the affirma- 
tive, I make it. 

Mr. Weitz. Now, assuming Mr. Isham's figures or accountancy is 
correct so that the figures are accurate, let's turn to the reasons that you 



7309 

honored what you were told was a commitment and your understand- 
ing of the commitment. Didn't Boh Isham, both before and after the 
time, particuLarly before the time, \vhen Mr. Nelson was replaced by 
you in January 1972, tell you there were serious illegal contributions 
that had been made through people like Russell and that was, in fact, 
one of the reasons that you had to get rid of Mr. Nelson? 

Dr. Meiiren. No. 

Mr. Weitz. You're telling me luider oath that under no circum- 
stances did you know that illegal corporate contributions were made 
through Mr. Russell, either before .January 12, 1972 

Dr. Meiiren. I am telling you under oath that to my knowledge the 
first time this matter came up was precisely as I told you ; the state- 
ment from Russell that there was an obligation of AISIPI to him for 
what had been done in 1971. The second stage is when I told him to 
go and look through his coded books, the reference to which also dis- 
turbed me rather deeply, and find out what he thought it was. The 
first step is when he brought it in to turn it over to Isham and say, 
"Is this correct or isn't it ?" The fourth step was to turn it over to Mr. 
Heininger, supposedly a competent attorney of basic integrity, and 
say, "Should I pay this?" That is the sequence of it. 

INIr. Weitz. Let's look through this and I don't want to belabor this. 
Mr. Russell's explanation was that the payments he had made Avere 
to attorneys — for attorney fees and expenses. 

]Mr. Heininger. For attorney fees. 

Mr. Weitz. For attorney fees. Now, isn't it true that Mr. Russell's 
billings were billed to the home office or almost all of his billings were 
billed to the home office ? 

Dr. Mehren. To my knowledge, all attorney billings come to the 
home office. 

Mr. Weitz. AVell, if Mr. Russell's ]>illings Avere to the home office, can 
you conceive of any rational or logical explanation as to why his pay- 
ments for other attorneys which, in turn, he had to bill the company, 
not only for the disbursement but also excess taxes, would be of any 
conceivable benefit to any rational or even irrational man from the 
viewpoint of AMPI ? 

Dr. Mehben. The answer he gave is the same answer he gave under 
oath, that he was under instruction from Harold Nelson to make these 
disbursements, to deliver these funds for ultimate transfer to other 
attorneys and I didn't like that at all. But now, I asked if they were 
unlawful and the answer was "No." I asked if I were required to pay it 
and the answer was "No." I repeat that I had to take such advice and 
I took it and I also did not like it. 

Mr. Weitz. In all fairness, I think the answer was "Yes," that you 
had to pay it. Isn't that Avhat you have testified to? I don't want the 
record to be incorrect. 

Dr. Mehren. The answer was that it was a lawful obligation. 

Mr. Heininger. The answer is "I can't say it is an unlawful 
payment." 

Mr. Weitz. I think you made a mistake. 

Mr. Meiiren. All right, yes. 

Mr. Weitz. Now, I am not asking Mr. Russell's — I am not asking 
you to account for Mr, Russell's i-easons for following through Mr. Nel- 
son's instructions. I am asking you in April of 1972 when you were 
presented with the question of whether this explanation was one that 



7310 

made the transaction appear legitimate to you, how you could have 
accepted that explanation when it had no basis in rationality. 

Dr. Mehren. I had to accept it as an obligation that was accurate, 
that in the business sense legitimate upon the finding of the comptroller 
and transmitted to me. 

Mr. Weitz. Mr. Isham only told you, I think you said, that the fig- 
ures were accurate and it was, in fact, an obligation of Mr. Nelson's. 

Dr. Mehrjen-. Yes. 

Mr. Weitz. Did you consider — suppose the obligation had been hypo- 
thetically an illegal obligation. 

Dr. Mehren. If it had been illegal, I would have said "No." 

Mr. Weitz. Did Mr. Isham tell you it was a legal obligation ? 

Dr. Mehren. I don't think Mr. Isham is competent to give me that 
opinion. 

Mr. Weitz. I know, he is not a lawyer. On what basis did Mr. Heinin- 
ger or you receive counsel that it was a legal obligation ? 

Dr. Mehren. By my sending it in and, I believe, with Isham. 

Mr. Weitz. I said a "legal" obligation, not a "correct" obligation or 
an "actual" obligation. 

Dr. Mehren. I sent it in and said is this payment lawful. 

Mr. Weitz. To whom, to Isham ? 

Dr. Mehren. To Mr. Heininger. 

Mr. Weitz. On what basis — what facts did you give Mr. Heininger ? 
Did you give him any facts other than what you have testified to here 
today ? 

Dr. Mehren. I had Mr. Isham go in and explain the transactions to 
Mr. Heininger and Mr. Heininger came in to me and said, "I think you 
should pay this." And this is precisely what happened. In the same 
situation, I'm afraid that is precisely what would happen now, and on 
the basis of the facts then represented to us, I expect we did the right 
thing. 

Mr. Weitz, Didn't you authorize, or didn't j^ou receive counsel to 
authorize, this transaction because Mr. Russell was an important per- 
son and lawyer in the defense of AMPI and the antitrust litigation? 

Dr. Mehren. No ; Mr. Heininger did not say that to me, and I have 
no reservation in the record showing what I said to you and then others 
many times from the beginning. This is for a variety of reasons. I was 
most uncomfortable with Stuart, Russell and repeatedly, and I think 
even before you became lead counsel, I asked your colleagues what 
should be done about this. The answer basically was that in the morass 
of 14 or 15 suits, the only person really competent to know what the 
genesis of them was, who the people were and so on. was Stuart Rus- 
sell. I expect from their side, and now I am placing thoughts into Mr. 
Heininger's mind and other counsel, that in April 1972, they didn't 
regard this as they now would. Furthermore, I don't think they had 
the facts available that they now have. I made repeated overtures and 
so did John Butterbrodt and so did others. Although Russell had 
many strong supporters and old friends of the southern part of the 
board of directors. I made repeated overtures, not for this reason be- 
cause I was just uncomfortable, what I considered direct procedures 
that an attorney should use ; and furthermore. I didn't have a layman's 
view that he was competent. This is another matter on this one and 
every other one. I took it to counsel and asked him what I should do in 
terms of law. 



7311 

Mr. Weitz. Now, AMPI has sent a letter to a representative of the 
Finance Committee To Re-Elect the President to seek reciiiitment of 
the $100,000 payment that was delivered, purportedly, to Mr. Kalm- 
bach in 1969, which was, ultimately, so you state in the letter. 

Mr. Heininger. We believe. 

Mr. Weitz. You believe. Was it repaid out of corporate funds ? Do 
you have any reason to believe that Mr. Russell was involved in that 
repayment arrangement? 

Dr. Mehren. Mr. Heininger told me now he believes so, but that is 
very recent knowledge — 2 weeks ago, perhaps. 

Mr. Weitz. In April 1972, you had never discussed with Mr, Butter- 
brodt or anyone else in AMJPI the political, the questionable, or ac- 
tually illegal transactions which had been authorized by Mr. Nelson 
during his tenure ? 

Dr. Mehren. I am not certain that by April 1972 the general rumor 
mill was generating issues of this sort. I know that later on, prior to 
my taking over, there were such rumors. There was no substantive 
knowledge. 

Mr. Weitz. Do you have any knowledge of a loan to Stuart Russell 
in April 1971 from AMPI ? 

Dr. Mehren. I had no knowledge of such loan on April 4, 1972, and 
I believe Mr. Heininger will agree that he nor I had any such knowl- 
edge. 

Mr. Heininger. At that time. 

Dr. Mehren. At that time. 

Mr. Weitz. Did Mr. Isham in April 1972 tell you the remainder of 
that loan to Mr. Russell was forgiven ? 

Dr. Mehren. No, sir, not to my recollection — or to yours ? 

Mr. Heininger. No. 

Mr. Weitz. I won't mark them unless you can identify them. I have 
two letters from Mr. Russell : One to Mr. Harold Nelson with a copy 
to Isham, and is dated April 21 ; and one to Nelson, dated April 24, 
to Isham. 

Dr. Mehren. Of what year? 

Mr. Weitz. Both 1972. Have you ever seen either of these letters? 

Mr. Heininger. Those came up in the course of the Russell deposi- 
tion. I did not see them prior to that either. 

Dr. Mehren. I have not seen them before. No, I am quite certain I 
have never seen either one of these. You know better than I do when 
I think we became aware of the apparent forgiveness or partial for- 
giveness of a note. But certainly we had no such knowledge at the time 
of the payment of the money. 

Mr. Weitz. Bob Isham didn't tell you of this forgiveness? 

Dr. Mehren. He never told me; did he tell you, Mr. Heininger? 

Mr. Heininger. No, I have no recollection. 

Mr. Weitz. Now, on April 18, 1972, the same date as the date of 
the check to Mr. Russell, which is exhibit 8. 

Dr. Mehren . What was that date ? 

Mr. Weitz. April 18, 1972. There is also a check in excess of $6,000 
to Frank I). Mastere & Associates; do you have any knowledge of 
that transaction, or do you attach any significance to the fact that it 
is the same date as the check to Russell ? 



7312 

Dr. Mehren. I don't have an}- knowledge of it. If you have some- 
thing I could look at, it might refresh my memory. 1 don't think I 
was involved. 

Mr. Weitz. Have you ever seen a copy of that check to Frank 
Masters ? 

Dr. Mehren. I don't think so. 

Mr. Weitz. Now, you will notice in the attached 

Dr. Mehren. Let me say this, Alan; I do know very well at some 
stage, probably later than this, I looked at the Masters bill and it 
seemed very high, and I did ask Isham, I think you and other attor- 
neys tried to minimize the outlays there. 

Mr. Weitz. Now, the invoices, for which thi