Letter from Washington

President Nixon’s decision to nominate Elliot Richardson to be Secretary of Defense provoked a quiet but intense struggle over whether Richardson can put men of his own choosing in the highest-level Pentagon positions. The White House is insisting on the right to appoint all assistant secretaries in all the departments. This would be a serious enough challenge to the strongminded Richardson even if the President had not appointed the new Number Two man at Defense, Deputy Secretary William Clements, without consulting Richardson. Clements is a rare creature, a Texan close to both John Connally and John Tower. He is a conservative and, inevitably, his nomination (and the way it was made) seemed like an attempt to “balance” the Pentagon leadership. This fed speculation that Richardson needs balancing and may not be master of his own house. Richardson probably is the toughest and most politically competent member of the new Cabinet, so the conflict with the White House may be protracted.

Notes on entrepreneurship in our ever more political economy: Representatives of big labor and almost as big business met in Washington recently for a cozy conference on productivity and how to increase it. Then I. W. Abel, president of the Steelworkers of America, and R. Heath Larry, vice chairman of the United States Steel Corporation, issued a joint announcement that, yes, they would work like beavers to improve productivity, but meanwhile something should be done to toughen those “voluntary” import quotas on foreign steel. . . . Herbert W. Kalmbach, the President’s personal lawyer, is said to have been given an advance briefing about the decision to establish a slew of special campaign committees (with names like “Americans United for Political Moderation” and “Committee for Greater Community Involvement”) to receive the contributions which expressed the dairy industry’s gratitude for the Administration’s decision to raise the price support for milk from $4.66 to $4.93 per hundredweight. . . . The Washington Star-News claims to have minutes of a June 6 meeting in which Roy Ash, then president of Litton Industries, threatened Navy officials that he would appeal directly to friends in the White House to solve Litton’s problems (a half-billion dollars’ worth) with Navy contracts for some LHAs (landing, helicopter assault ships) being built —sort of—in some automated—well, sort of—shipyards located, for some reason, in Mississippi, home of Senator John Stennis, Chairman of the Senate Armed Services Committee. If Ash wants to plead Litton’s case with White House friends these days he does not have far to walk. He has been appointed to the White House staff as head of the super-powerful Office of Management and Budget. Some Washingtonians believe Litton is a candidate for the next Lockheed-type bail-out. If it is, Ash will become an issue. . . . On the other hand, perhaps Grumman Aerospace Corporation will be the next big defense contractor in trouble with the Navy. Grumman has been ordered to deliver another 48 F-14 fighter planes under terms of an existing contract. Grumman says it will not build the planes unless the contract is renegotiated. Will the government get tough? What can the government do if the corporation digs in its heels? Stay tuned. Grumman employs a zillion people on Long Island. If Grumman gets in trouble, watch for fancy footwork from Senator Jacob Javits (R., N.Y.) who is a) a scourge of the military-industrial complex and b) up for re-election in 1974. . . . And then there is the story of the Teamsters union’s search for the best possible legal help for its members. The union’s Washington lawyer used to be Edward Bennett Williams, who also works for the Democratic National Committee—Watergate and all that. So now another law firm will receive the estimated $100,000 per year union business. The lucky law firm also is to receive the services of lawyer Charles Colson, fresh from four years on the Nixon staff and credited with helping persuade the Teamsters to endorse Nixon this year.

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Department of Defense

President Nixon’s decision to nominate Elliot Richardson to be Secretary of Defense provoked a quiet but intense struggle over whether Richardson can put men of his own choosing in the highest-level Pentagon positions. The White House is insisting on the right to appoint all assistant secretaries in all the departments. This would be a serious enough challenge to the strongminded Richardson even if the President had not appointed the new Number Two man at Defense, Deputy Secretary William Clements, without consulting Richardson. Clements is a rare creature, a Texan close to both John Connally and John Tower. He is a conservative and, inevitably, his nomination (and the way it was made) seemed like an attempt to “balance” the Pentagon leadership. This fed speculation that Richardson needs balancing and may not be master of his own house. Richardson probably is the toughest and most politically competent member of the new Cabinet, so the conflict with the White House may be protracted.

Notes on entrepreneurship in our ever more political economy: Representatives of big labor and almost as big business met in Washington recently for a cozy conference on productivity and how to increase it. Then I. W. Abel, president of the Steelworkers of America, and R. Heath Larry, vice chairman of the United States Steel Corporation, issued a joint announcement that, yes, they would work like beavers to improve productivity, but meanwhile something should be done to toughen those “voluntary” import quotas on foreign steel. . . . Herbert W. Kalmbach, the President’s personal lawyer, is said to have been given an advance briefing about the decision to establish a slew of special campaign committees (with names like “Americans United for Political Moderation” and “Committee for Greater Community Involvement”) to receive the contributions which expressed the dairy industry’s gratitude for the Administration’s decision to raise the price support for milk from $4.66 to $4.93 per hundredweight. . . . The Washington Star-News claims to have minutes of a June 6 meeting in which Roy Ash, then president of Litton Industries, threatened Navy officials that he would appeal directly to friends in the White House to solve Litton’s problems (a half-billion dollars’ worth) with Navy contracts for some LHAs (landing, helicopter assault ships) being built —sort of—in some automated—well, sort of—shipyards located, for some reason, in Mississippi, home of Senator John Stennis, Chairman of the Senate Armed Services Committee. If Ash wants to plead Litton’s case with White House friends these days he does not have far to walk. He has been appointed to the White House staff as head of the super-powerful Office of Management and Budget. Some Washingtonians believe Litton is a candidate for the next Lockheed-type bail-out. If it is, Ash will become an issue. . . . On the other hand, perhaps Grumman Aerospace Corporation will be the next big defense contractor in trouble with the Navy. Grumman has been ordered to deliver another 48 F-14 fighter planes under terms of an existing contract. Grumman says it will not build the planes unless the contract is renegotiated. Will the government get tough? What can the government do if the corporation digs in its heels? Stay tuned. Grumman employs a zillion people on Long Island. If Grumman gets in trouble, watch for fancy footwork from Senator Jacob Javits (R., N.Y.) who is a) a scourge of the military-industrial complex and b) up for re-election in 1974. . . . And then there is the story of the Teamsters union’s search for the best possible legal help for its members. The union’s Washington lawyer used to be Edward Bennett Williams, who also works for the Democratic National Committee—Watergate and all that. So now another law firm will receive the estimated $100,000 per year union business. The lucky law firm also is to receive the services of lawyer Charles Colson, fresh from four years on the Nixon staff and credited with helping persuade the Teamsters to endorse Nixon this year.