Teapot dome scandal
thaines (#1269)
4 Plays

1. John 3:16 (NIV)
Before Watergate, there was the Teapot Dome scandal. A scandal that destroyed a president’s administration, caused a murder-suicide and involved hundreds of thousands of dollars of bribes. The Teapot Dome scandal involved everything a soap opera would need. A scandal so large, that it shook the nation's trust in its government for years. In the beginning, there was Harding, a “go along to get along man”, notorious for cheating on his wife, going as far as having a child by one of his mistresses. (History, para. 4 & National 3:04-3:07) Big oil men, especially Henry Ford Sinclair and Edward L. Doheny, helped Harding win in return for the promise of an oil-friendly cabinet. (History, para. 4) This directly conflicted with the basis of Harding’s campaign, based on balancing conservation and industry. ( History, para. 5) The oil men’s first choice for the secretary of the interior was Jack Hammond, who, before taking office, was killed by his mistress. (National, 5:00) After a landslide win by Harding, with most of his votes being bought, came the choices of the cabinet. Many of Harding’s more shady friends ended up on the cabinet, including Albert Fall, an anti-conservation ex-senator from New Mexico. (National 5:27). To understand the main point of the scandal, it is necessary to look back at the two major oil fields involved. Teapot Dome is a large oil field, worth hundreds of millions to oil companies, which was named for its classic rock formation, shaped like a teapot. These oil reserves were set aside for naval use in 1912 by President William Howard Taft, using information gathered by the Public Lands Commission to withdraw both Teapot Dome and Elk Hills from public use to be used by the Navy. (Barbara, p 34) The navy, who was switching ships from coal power to refined oil, wanted to prepare for an emergency. (History, para. 2-3) This oil would be a precious and profitable resource for private companies wanting to tap into the reserves. Fall, who was the Secretary of the Interior, needed to transfer the reserves to become under his control, as they were currently under the Secretary of the Navy’s control. (National, 8:05) Fall’s argument was basically that, as a public recourse, they should be under public control. He promised, however, to maintain the Navy’s exclusive control over the reserves. This was an extremely logical argument, as most reserves were already under Fall’s control. By this time, Harding’s cabinet was already under scrutiny. There was much suspicion of the cabinet taking bribes and drinking whiskey, along with selling licenses to use confiscated liquor. (History, para. ) Fall was not above this, as he reportedly enjoyed whiskey while playing poker, prohibition notwithstanding. (History, para. 7) By the end of 1929, Fall had made contacts with private businessmen. The purpose of these meetings was to discuss secret, profitable lease agreements for Teapot Dome and Elk Hills. (Barbara, p. 42) Fall was longtime friends with two oil men, Harry F. Sinclair and Edward L. Doheny. Fall was in extreme financial trouble, with his ranch close to being foreclosed and thousands in debt to politicians and businessmen. As Sinclair and Doheny had helped further their political careers by buying his votes, Fall was heavily inclined to help them get leases. (National, 4:29) Fall needed large amounts of money to get himself out of debt and expand his ranch, a goal of his. The oilmen needed a way to make this money. It is suspected that the money used to bribe Fall was made by Sinclair defrauding his company’s investors. (National, 9:30) Negotiations were made and Fall received a no-interest hundred-thousand-dollar “loan” from private businessmen. In return for this so-called loan, Fall gave drilling rights to Doheny at locations in Elk Hills and Buena Vista, California. (Barbara, p. 42) Fall then received another secret four-hundred-thousand dollar bribe from Sinclair. (Barbara, p. 43) Fall then gave the drilling rights to the much larger Teapot Dome in Wyoming. While both reserves were worth millions of dollars, Teapot Dome was much larger and had more oil. These loans were delivered in just as sneaky ways. Fall’s ranch manager received several thousand dollars, which was transferred to Fall. Fall’s son-in-law received three hundred thousand dollars in liberty bonds and cash which was transferred to Fall. (History, para. 25) Fall also received a large herd of livestock from Sinclair. (History, para. 25.) The bribe money from Doheny was delivered by his son and his son’s friend in a black bag with the cash in it. There is also the chance that Harding benefited from the bribes too. Just before Harding departed on a cross-country trip, he received and accepted a suspiciously high offer for his newspaper, the Marion Star. (History, para. 20) The president also was telling friends about a year-long all-expenses-paid cruise around the world on Sinclair’s yacht that they would take once Harding was out of office. (History, para. 21) Fall was able to get out of debt with these loans, as well as purchasing more land and animals. (Barbara, p. 45) Some of these animals were likely provided by Sinclair. (History, para. 25) A truck with the Sinclair logo was spotted heading to Teapot Dome. This incident was not widely reported. The Denver Post and an oilman blackmailed Sinclair into paying each one million dollars. (History, para. 13) it is likely that Harding, afraid of bad press, pressured Sinclair to pay the two. (History, para. 14) Finally, the Wall Street Journal took the story. The day after the Wall Street Journal broke the news, an investigation was launched. (History, para. 11) Another oilman, James G. Darden claimed that he had the first claim to Teapot Dome. (History, para. 12) As Harding was such a popular president, the general public did not care much about the scandal. (Barbara, p. 48) The investigation was very private for the first while, with the Committee on Public Lands and Surveys calling dozens of witnesses over six weeks. (Barbara, p. 58, 60) Fall claimed that if the details would become public, enemies would no about the concerns with oil production. (Barbara, p. 58) He also pled the Fifth Amendment, so he didn’t have to testify, even though it wasn’t in a court of law. (Barbara, p. 59) Harding unexpectedly died on a cross-country trip to visit Alaska in a hotel in San Francisco. (History para. 22) President Coolidge took over and revealed the investigation to the public. (Barbara, p. 68) Two lawyers were appointed, a Republican and a Democrat, to not make either party feel more threatened. (Barbara, p. 68) Neither lawyer was from Daugherty’s DOJ, making it obvious he was not trusted. (Barbara, p. 69) Senator Matt Walsh claimed that the DOJ was not reliable, saying it was “handpicked by Daugherty and rotten to the core”. (Barbara, p. 71) Fall was convicted to a year in jail, as well as being fined one hundred thousand dollars. (History, para. 26) Sinclair was charged with contempt of Congress and jury tampering, serving six months. (History, para. 31) Doheny, however, was acquitted on all charges. Doheny’s son, Ned, who delivered the money to Fall, was murdered by his friend, who also helped, and then killed himself. It is suspected that he was killed because of fear of being convicted. (History, para. 28-29) The leases were cancelled and the oilmen had to pay the government several hundred thousand dollars. Fall only served nine months and his fine was waived, as he was in poor health and had lost all his money. Harding is now considered one of the worst presidents in U.S. history, and this scandal was the worst until Watergate, which completely overshadowed it. The prosecution set a precedent as well, making Fall the first cabinet member to be charged with a federal crime in office. Production was stopped in 1927. Elk Hills was sold for a fair price during an auction in 1995. Teapot Dome was eventually sold in 2015, after fair bidding. The main lesson of all this is that no one is above the law, even those in the highest authority.

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