Eisenhower's Oligarch
Or, when it comes to influencing government, the tech bros are aspiring amateurs
While the aptly named tech bros, such as Elon Musk, Jeff Bezos, Peter Thiel, Marc Andreessen, Vivek Ramaswamy, and the like, are getting a lot of attention in the news these days and are considered by many to be the new “shadow government” of the United States, their impact on the way government actually behaves pales compared to industrialists of the past, particularly John McCone (January 4, 1902 – February 14, 1991).
McCone started his career as a mechanical engineer in large-scale industrial construction. He went on to partner with industrialist Stephen Bechtel to form Bechtel-McCone Corporation, a company that made a fortune from government contracts during WWII. The Bechtel-McCone Corporation dissolved in 1945.
McCone became Under Secretary of the Air Force in the Truman administration in 1950, head of the Atomic Energy Commission (AEC) during the Eisenhower administration, and then Director of the CIA from 1961–1965. Although he was no longer an active businessman upon entering government service, by 1955, when he was head of the AEC, McCone was the second largest shareholder in Standard Oil of California. Also, he indirectly helped the Bechtel Group, the conglomerate formed in the wake of the dissolution of Bechtel-McCone, during his years on the AEC by promoting the propagation of atomic energy as a for-profit concern and shifting AEC funding to private companies, one of which was Bechtel.
When McCone took over the CIA in 1961, agency-sanctioned, secret political assassinations were typical to the point that according to author Sally Denton in the book The Profiteers: Bechtel and the Men Who Built the World, upon the assassination of President John F. Kennedy in 1963, his brother Attorney General Robert F. Kennedy called Director McCone to Kennedy’s Hickory Hill estate outside of Washington DC and asked the director if the CIA had killed his brother. McCone answered, no. Kennedy believed him, but the fact that the brother could think that domestic assassination was possible lends a chilling perspective to the intrigue and tenor of the times.
Such was the power that McCone had. Musk's and Ramaswamy’s efforts to make government more efficient are child’s play compared to McCone's endeavors. For the tech bros, the government is something to be twiddled with through tweets, political contributions, ads, and attention-seeking behavior. In McCone’s world, big-business corporations are the breeding ground for those who will be appointed to run the US government. There’s no need to publicize the fact that their executives become government leaders because, unlike the tech bros world, publicity serves no purpose. Power advertised is power diminished.
McCone and Bechtel
To understand how somebody like John McCone could come to such power within the US Government, you need to understand his partner company, Bechtel, and the scope of its operations.
Bechtel Corporation was founded by Warren A. Bechtel in 1898 as a construction subcontractor. By 1925, the company was one of the largest construction firms in the Western United States. It was part of the Six Companies consortium that built the Hoover and Grand Coulee Dams in the southwest United States and Washington state, respectively.
In 1937, Warren’s son, Stephen Bechtel, and John McCone, along with silent partner Henry J. Kaiser, formed the Bechtel-McCone Corporation. Bechtel-McCone built multiple refineries for Standard Oil of California. The company was part of a consortium that was awarded a contract by the War Department in 1942 to construct an oil pipeline through Alaska and to build a refinery at a terminus point at Whitehorse, Yukon. Also, the War Department contracted Bechtel-McCone to build pipelines and refineries in Mexico, Venezuela, Bahrain, and off the coast of Saudi Arabia. In addition, Bechtel-McCone constructed and ran plants that fulfilled War Department contracts to modify B-24 Liberators and B-29 Superfortresses. According to Kay Matthews, in her 2012 article, Bechtel and Los Alamos National Laboratory: The Privatization of the Nuclear Industry, during the war years, Steve Bechtel and John McCone made over $100 million dollars on less than a $400,000 investment during the war.
Bechtel-McCone Corporation disbanded in 1945. In 1950, McCone became the Under Secretary of the Air Force. He was appointed Chairman of the Atomic Energy Commission during the Eisenhower administration in the 50s and Director of the CIA from 1961 to 1965.
The Bechtel Corporation went on to become the Bechtel Group. This conglomerate mined coal, uranium, and other precious metals, as well as constructed oil pipelines, atomic reactors, and military installations throughout the world. Bechtel was particularly active in the Middle East, constructing the Trans-Arabian Pipeline, which was started in 1947 and ran from Saudi Arabia across Jordan and Syria to Lebanon. Bechtel also built the Kirkuk-Baniyas pipeline in 1950, which connected oil fields in Iraq to the Mediterranean Sea.
Bechtel got into the atomic reactor business in 1949 building the Experimental Breeder Reactor-1 (EBR-1) in Idaho for the AEC. Bechtel went on to build nuclear reactors not only in the United States but also in South Korea, the United Arab Emirates, Poland, China, India, and Bulgaria. The company took over the operation of the Los Alamos atomic facility in 2006, where the first atomic bombs were built.
Other Bechtel executives, in addition to John McCone, have held powerful positions in the US Government. W. Kenneth Davis was Bechtel’s vice president for nuclear development before joining the Reagan administration as Deputy Secretary of Energy. George Schultz, Secretary of State during the Reagan presidency, was the President of Bechtel from 1975 until 1982. Shultz returned to Bechtel in 1989 after leaving the State Department. Caspar Weinberger, Reagan’s Secretary of Defense, was formerly Bechtel’s general counsel.
Another interesting point to note is that the Bohemian Club, which is a fraternal organization of businessmen, politicians, artists, and writers that holds camp-out events at its Bohemian Grove facility in the woods of Northern California, enabled close ties between Bechtel and the White House. Bohemian Club members, past and present, include presidents Herbert Hoover, Dwight D. Eisenhower, Ronald Reagan, Richard Nixon, George H.W. Bush, and George H. Bush. John McCone and three generations of the Bechtel family are or have been club members. Dwight D. Eisenhower and Steve Bechtel relaxed together at the Mandalay Camp, an exclusive outdoor facility associated with the Bohemian Club. One story has it that they urinated on the same tree during a night of outdoor festivities.
That Eisenhower would make a speech at the end of his presidency warning the country about the risks at hand due to the rise of the military-industrial complex is interesting, given that its executives had been his playmates for years.
If amateurs go pro
Political power in an oligarchical society is a round-trip ticket between business and government and vice versa. The revolving door relationship between Bechtel and the US Government is sadly typical of the way things are. It’s been going on for a long time. There's nothing new here.
What is new is that the current crop of tech bros players doesn’t have the generations of grooming required to take and hold the reins of power in big league government. Oil tycoon John D. Rockefeller never held a seat in government, but his grandson Nelson did. The tech bros have no grandpa that will tell them how the game is really played.
It takes decades of intergenerational connivance between business and government, with a lot of favors bestowed along the way, to get to the pinnacles of power and stay there. This current batch of tech bros trying to make the move might be in for a surprise. Do they really think that the likes of Brendon Bechtel, current CEO of the Bechtel Group and fifth-generation scion of the company's founder, will just roll over and acquiesce their historic birthright to rule? Not without a fight. So standby. A rude awakening might be at hand.