A new book by The Seattle Times Investigations Editor James Neff digs deep into Bobby Kennedy’s quest to oust the thieving union leader.
The following excerpts are from the book “Vendetta: Bobby Kennedy Versus Jimmy Hoffa” by James Neff, copyright 2015 by Little, Brown and Company. All rights reserved. Also included are comments from the author.
(Little, Brown and Company, $28)
James Neff will discuss his book “Vendetta: Bobby Kennedy Versus Jimmy Hoffa” at 7 p.m. Monday, July 13, at Elliott Bay Book Company, 1521 10th Ave., Seattle.
Author’s note: In 1956, brothers John and Bobby Kennedy, and Teamsters leader Jimmy Hoffa were far from the iconic national figures they’d become within a few short years. They were even lesser known in Seattle, where the city’s own Dave Beck ruled as president of the International Brotherhood of Teamsters, dominating politics across the state as he built his union into the nation’s biggest, toughest labor force. John Kennedy was a junior senator from Massachusetts with a thin legislative record. His 31-year-old brother worked as chief counsel for a Senate investigating committee under conservative Democratic senator John McClellan of Arkansas.
At the time, Bobby Kennedy was searching for worthy subjects to investigate and was being hectored by muckraking reporter Clark Mollenhoff, of The Des Moines Register, to look into the Teamsters and particularly Hoffa, who he claimed had unexplained wealth and underworld ties.
IN THE LATE FALL of 1956, Robert Kennedy began a preliminary investigation into the backgrounds of Hoffa, Beck and the Teamsters union. He took a trip to Seattle to meet with a colleague of Mollenhoff’s, reporter Ed Guthman of The Seattle Times, a Pulitzer Prize winner who had been investigating Beck, the Teamsters president, off and on for eight years. Guthman had broken the story about the Teamsters doling out an expensive perquisite to Beck. It paid $163,000 for Beck’s spacious home on the shores of Lake Washington, just north of the Seattle city limits, then allowed him and his family to live there rent-free. There was more. Sources inside the Teamsters told Guthman that Beck was a thief, diverting union funds to pay for personal expenses. But Guthman couldn’t pin down the story. Beck was the most powerful man in the state of Washington, with friends in law enforcement, and union insiders were afraid of him. Guthman needed help.
In meeting with Kennedy, he had to decide whether he’d resort to an investigative reporting gambit: trade his tips and research to a congressional investigator who had subpoena power and might get closer to the truth in exchange for the investigator’s promise to leak anything newsworthy back to him exclusively. Guthman was wary of Robert Kennedy; in the northwest corner of the country, the reporter knew him only as the little brother of a handsome Massachusetts senator with a reputation as a millionaire playboy.
“Can you trust him?” Guthman asked Mollenhoff. He replied yes.
To keep his mission quiet, Kennedy checked into Seattle’s venerable Olympic Hotel using a fake last name, Rogers. He met Guthman for dinner and listened as the newsman told him about unhappy Teamsters drivers who felt stung by sweetheart contracts and were threatened at union meetings when they dared to complain. When RFK asked for their names, Guthman held back, wondering if this neophyte investigator was serious. Did he even know how to protect sources?
By the next morning, Guthman decided to reveal their names, persuaded by RFK’s earnestness and concern. When Kennedy met with Guthman’s sources, he was struck that one of their chief complaints about Beck wasn’t a pocketbook issue but the labor leader’s pompous refusal to let members have a say about how their locals were run. Indeed, Beck bragged that he ran his union the way executives ran General Motors — time-honored, top-down management.
Beck wasn’t always such a stuffed shirt. Like Hoffa, he grew up poor and loved to remind people of that fact. His father barely made a living as a carpet installer. To help the family finances, young Beck peddled newspapers, sold fish he caught in Puget Sound and killed wharf rats that he delivered to public health officials. (They paid him a $5 bounty for each one that tested positive for bubonic plague.) Beck climbed from Teamsters organizer to local president to head of the giant Western Conference of Teamsters with his advocacy of “business unionism.” He convinced business owners that they would profit from the stability created by paying somewhat higher wages to workers. Chambers of commerce loved him. A florid, fleshy man with a bald head, Beck used his power to insinuate himself into Seattle’s political and cultural establishment. He bought downtown real estate, gas stations and other small companies. By the 1950s, Beck, a Republican, had become more powerful in Washington state than the governor. President Eisenhower welcomed him at visits to the White House, referring to him as the Republicans’ labor statesman. Behind his back, Beck was known as His Majesty the Wheel.
In Seattle, Kennedy was steered to a man who urged him to explore Beck’s dealings with Nathan Shefferman, a Chicago “labor consultant.” In fact, Shefferman was a fixer, a middleman between companies and union leaders willing to sell out. Typically, he took large fees from companies in exchange for convincing “friendly” union officials, for a price, to agree to a substandard contract. Sears, Roebuck and Co., it would later come out, used Shefferman to arrange sweetheart contracts that affected thousands of Teamsters drivers and warehouse workers throughout the country. The connivance saved the giant retailer millions of dollars.
SEVERAL DAYS BEFORE Christmas, Kennedy and committee staffer Carmine Bellino landed in Chicago during a snowstorm and met with Shefferman at his office in the Loop. He chatted amiably, insisting he had nothing to hide. When they served him with a documents subpoena, he let them borrow his books and financial documents for a day or two. Toting the bundles of ledgers and documents, RFK and Bellino pushed through the snow and past shoppers on Michigan Avenue to return to their rooms at the Palmer House hotel, wondering what they’d find.
Bellino was a genius of forensic accounting. In the previous few years, he had worked on three congressional investigating committees that needed help tackling tricky white-collar criminal matters. He could take stacks of receipts, canceled checks, phone records, bank statements, contracts and (when he could get them) federal tax returns and quickly spot transactions out of order or numbers that didn’t match up. For example, a canceled check creased down the middle drew Bellino’s suspicions. It likely meant someone had folded it in half and slipped it in his pocket or a wallet. That didn’t mean it was a payoff; but depending on the payee, such checks were flagged for closer scrutiny.
Bellino spread out the ledgers and papers and got to work, looking for missing entries, large checks made out to “Cash,” and other red flags. Within an hour, he had seen enough to conclude that Beck was diverting union funds to Shefferman for “consulting” — which actually meant serving as a personal shopper for Beck, spending tens of thousands of Teamsters dollars on personal goods for Beck and his family: golf clubs, outboard motors, a freezer, chairs, love seats, 21 pairs of nylon stockings. “We had come to the startling but inescapable conclusion,” Kennedy later wrote, “that Dave Beck, the president of America’s largest, most powerful labor union, was a crook.”
Kennedy had to decide what to do next. Bellino had seen two other congressional investigations into union rackets get started then falter as political pressure closed them down. “Unless you’re prepared to go all the way,” Bellino warned Bobby, “don’t start it.” RFK replied, “We’re going all the way.”
IN LATE JANUARY 1957, the bipartisan Select Committee on Improper Activities in the Labor or Management Field (nicknamed the Rackets Committee) got down to business, with McClellan as chairman and Kennedy as chief counsel. Within weeks, they and their growing staff of investigators brought in labor racketeers from Seattle, Portland and beyond to testify before the televised hearings, which proved to be a national sensation.
The committee’s frenetic hard work paid off when Beck rolled into the Senate Caucus Room that spring with two lawyers, a bulging brown briefcase of financial records and a cocky smile. He had avoided a Rackets Committee subpoena for more than a month, thanks to a suddenly scheduled vacation in Europe and other tactics, and finally arrived to face Sen. McClellan, his eager chief counsel, Kennedy, and the glare of television cameras. Asked by a reporter if he was nervous, Beck blared, “Nervous? Me? Haw!”
Before settling in at the witness table, Beck turned his three-diamond ring into the palm of his left hand, claiming, “I always wear it that way because the light flashes in my eyes.” He clasped his hands to hide any trembling as Chairman McClellan read the committee’s provocative opening statement. Investigators had uncovered information, McClellan said, that “the president of the International Brother(hood) of Teamsters, Chauffeurs, Warehousemen and Helpers of America, the largest, most powerful union in our country, may have misappropriated over $320,000 in union funds.”
When McClellan asked Beck for the subpoenaed financial records, the Teamsters president declared that turning them over would violate his Fifth Amendment right against self-incrimination. Because he was entangled in tricky legal maneuvers with the IRS over accusations of income tax fraud, Beck was taking a prudent path. In question after question, McClellan bore in on the matter of checks paid to Beck from the Seattle Teamsters local, and Beck pleaded the Fifth. Then McClellan provoked him: “Do you regard your privileges under the Fifth Amendment as transcending your duty and obligations to the laboring men of this country who belong to your union?”
By that point Beck was red-faced, and he leaned toward McClellan and appeared to begin to mouth a reply. “Just in time, his sad-faced lawyer, Arthur Condon, drove (a) swift knuckle into the small of Beck’s back,” a reporter would later write. “Three times Beck started to answer; three times Condon’s knuckle dug into his spine. Beck soon developed a sort of Pavlov’s dog response to the knuckle.” Each time Beck felt the jab, he replied, “I must decline to answer . . . ”
When McClellan turned the questioning over to Bobby Kennedy, RFK was ready with documents that Bellino and others had harvested from labor fixer Shefferman, the IRS, and Teamsters union ledger books. He patiently introduced every damaging scrap into the Senate hearings record, knowing Beck would plead the Fifth, and irreparably tarred Beck’s once-clean public image. Within hours, according to a reporter, RFK had “made public one of the most fantastic money merry-go-rounds in congressional investigation history.”
THE OUTLINE OF Beck’s boodling was vast: from 1948 to 1953, he took $196,000 in Teamsters funds to pay a contractor for work on his home on Lake Washington. In March 1954, after IRS agents started digging into his taxes, Beck decided to pay back the union coffers. To raise quick cash, he sought a $200,000 loan from a large Detroit trucking firm, Fruehauf Trailer Company. Its officers couldn’t put together the loan, so they went to Brown Equipment, a New York trucking company. Brown sent four checks of $50,000 each to Beck. He in turn sent $200,000 to the Teamsters from his own Seattle company, B&B Investment.
When Brown sought repayment, Beck concocted another maneuver, according to Kennedy. Beck “had the idea of selling his house to the union, which, of course, had paid for (it) originally, or at least a part of it, and selling the furniture, which the union had paid for.” Teamsters headquarters paid $163,000 for Beck’s compound in Sheridan Beach, at the north end of Lake Washington — a large, brick ranch home and several smaller houses occupied by his mother, a bodyguard, the vice-president of a Beck-owned brewery and others. Beck was allowed to live in the big house rent-free — for life.
The Teamsters president never recovered from the humiliation of the Rackets Committee’s brutal, televised drubbing. His worst sin, in the eyes of the public and union members, was the revelation that he had drained thousands of dollars from a trust fund set up to aid the widow of one of his best friends. “From that moment, Mr. Beck’s star sank,” The New York Times said. A month later, Beck announced he would not run for re-election as president of the Teamsters. That fall, Beck and his son were charged with federal tax evasion.
To Hoffa’s delight, the Teamsters presidency was now in play. And he was more determined than ever to make certain Bobby Kennedy didn’t scorch him the way he had Dave Beck.
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Author’s note: In October 1957, Hoffa was elected president of the Teamsters union. Bobby Kennedy not only was disgusted but felt partly to blame because he had cleared the path for Hoffa by knocking Beck from office. Beck was “just a thief,” RFK would later say, whereas Hoffa was a corrupting force. Over the coming years, Kennedy would use all of his growing power — as crusading committee chief counsel and later as attorney general in the administration of President John F. Kennedy — to try to destroy Hoffa. Beck was convicted of state grand larceny charges and federal income-tax evasion. He began serving a five-year sentence at McNeil Island Penitentiary, after exhausting appeals, in 1962 and was released 2½ years later. He still had clout. Washington Gov. Albert Rosellini gave him a state pardon in 1965, and President Gerald Ford issued a federal one in 1975. Beck oversaw his real-estate holdings and other investments here until his death in 1993. He was 99.