Setting the Record Straight: Harry Dexter White and Soviet Espionage

With the recent publication of Benn Steil’s New York Times opinion piece, “Banker, Tailor, Soldier, Spy,” considerable interest has once again focused on whether Harry Dexter White – an assistant secretary of the Treasury and that department’s key figure in the founding of the World Bank and the International Monetary Fund (IMF) – was a Soviet spy.  White’s daughter, Joan Pinkham responded to Steil’s assertions by claiming that the evidence the author cited did not establish her father’s guilt. In fact, both Steil and Pinkham loosely played with the facts and twisted the truth about Harry Dexter White’s role with both the founding of the Bretton Woods institutions and the Soviet underground.

Steil argues that because White had been under surveillance as a suspected Soviet spy by the FBI for several months, that he was passed over by President Truman to become the head of the IMF, and, that instead, the Truman administration was given the position of World Bank presidency as “a consolation prize” because the White House was “trying to dodge a spy scandal.” Steil misrepresents the true story of how the US government laid claim to the World Bank, and his conclusion is not supported by the historical evidence.

Here’s what actually happened: In January 1946, the Truman administration concluded that having an American serve as president of the World Bank was more important than having one named managing director of the IMF. It was a strategic political decision; simple as that. White indeed had been under FBI surveillance since early 1946, but President Truman had little regard for Bureau director J. Edgar Hoover’s hearsay evidence: an unsupported and uncorroborated November 1945 allegation by Elizabeth Bentley, who was considered a somewhat unstable self-confessed former Soviet agent of questionable reliability. In fact, White’s influence in the Treasury had been in decline for some time, not so much because of the spy allegation, but because Treasury Secretary Fred Vinson had a personal dislike for him (White was well known for an arrogance that grated on superiors and co-workers alike; Cold War diplomat, Paul Nitze, for example, characterized him as a “triple-barrel son-of-a-bitch”). 

President Truman discounted the FBI’s questionable evidence of White’s alleged espionage activities and advanced his appointment to serve on the IMF governing board as the first American director of the Fund. Following Senate confirmation, from April 1946 to the end of March 1947, he served with distinction during the formative first year of the Fund’s operation. Even after White’s resignation (brought about by his being increasingly at odds with prevailing American economic policy), he remained somewhat influential. Upon his departure White was appointed “Honorary Advisor to the IMF”—a position that allowed him to advance his views on the needs of the world economy without the constraints that had been placed on him by the U.S. government.

In defending her father’s reputation, Joan Pinkham argues that a memorandum in White’s hand that one-time Soviet spy-turned-patriot Whittaker Chambers possessed, along with a series of cables known as the VENONA decrypts “raise as many questions as they answer” and “can by no means be said that they establish [her] father’s guilt.” In fact, mounting evidence has come to light over the years that strongly implicates her father in what I characterized in my book on the White case, Treasonable Doubt, as “a species of espionage.”  In the eight years since the book’s publication that assessment has simply been reinforced by new evidence.

White was first implicated in espionage activities in testimony given by Elizabeth Bentley in the summer of 1948 during hearings being conducted into communism by the House Committee on Un-American Activities (HUAC).  Shortly thereafter, White appeared before HUAC where he made a spirited denial of any wrong doing.  Just days later he died of a heart attack at his Fitzwilliam, New Hampshire, summer home.  

Subsequent evidence suggestive of White’s complicity in Soviet espionage was provided by Whittaker Chambers, a courier for the Soviet military intelligence service GRU/Communist Party USA's information-gathering espionage apparatus. In November 1948 Chambers produced the first documentary evidence of White’s complicity—the so-called “White Memorandum.” It is a four-page document written in White’s hand that resembles an aide de memoir.  Its contents relates to a wide assortment of Treasury-related issues though Japanese financial matters appear a central theme.  Chambers claimed White gave him the memo to turn over to Chambers’ Soviet handlers.  Subsequent raids by the FBI on White’s New Hampshire house several years later turned up little more than Mrs. White’s well-thumbed Russian Communist song books which did nothing to confirm any illegal activity on the part of her late husband.

However, in 1996 an important source of corroborating evidence came to light with the release of the VENONA decrypts. The decrypts are messages between the KGB’s* Moscow Center and their agents throughout the world that were intercepted and translated into English by American intelligence agencies. The intercepts revealed that the KGB had assigned White a series of code names—JURIST, LAWYER and RICHARD—all suggestive that some type of relationship existed between him and Soviet intelligence. 

Most damaging was a decrypt documenting a July 31, 1944 meeting at White’s apartment where he surreptitiously met with an unidentified high-ranking Soviet official codenamed KOLTSOV. A summary of the conversation indicates that White had previously passed information on to the Soviet underground; that he and his wife were willing to endure “any self-sacrifice” for the cause of Soviet-American cooperation; and that he was willing to continue to provide the Soviets with information in the future—provided such meetings were merely “infrequent conversations [every 4-5 months]” that they would last no longer than half-an-hour and they would take place while White was “driving in his automobile.”

The evidence against White continued to mount when the notebooks of Alexander Vassiliev, a former KGB officer and journalist who had access to secret KGB files in the early 1990s, became known to scholars. Shortly after the publication in May 2009 of John Haynes and Harvey Klehr’s Spies: The Rise and Fall of the KGB in America, which Vassiliev co-authored, the English translation of the former KGB officer’s notebook’s contents were posted on the Internet. Vassiliev’s copious notebooks revealed a heretofore unknown new pseudonym for White—REED.  Vassiliev’s notes of KGB memoranda reflect the gist of over two dozen documents that specifically relate to White and his activities. Collectively the notes further suggest—and at times substantiate—White’s one-time relationship as “a PROBATIONER [agent] of the NEIGHBORS  [GRU]” whose “friendship,” one cable reveals, “dates back to 1937-1938.”

Though references to White in the Vassiliev notebooks are fragmentary, the notebooks trace the KGB’s 1943-45 efforts to recruit White into espionage.  They also examine his relationship with Nathan Gregory Silvermaster, head of a CPUSA spy apparatus that centered in the Treasury Department. One document in this series indicates that the KGB was under the impression that White once shared information with the GRU, though they were given to understand that he “[did not] provide documents.”

Vassiliev’s notes indicate that during the San Francisco Conference KGB officers managed to directly finagle useful information out of White on the American positions on various United Nations-related issues which White most willingly divulged. Based on what apparently were informal conversations, Moscow Center concluded that the results of that San Francisco meeting demonstrated what “skilful guidance” by Soviet agents could obtain from White.  

Finally, the Vassiliev notebooks document that, in spite of persistent efforts, Silvermaster eventually gave up on trying to make White into a systematic source for information. Taken individually, one could argue that some of the documents indicate that White may have not always have been aware that his information was being passed on to Moscow, but taken collectively, Vassiliev’s documentation leaves little wiggle room for White’s defenders to continue to assert that he was not involved in an activity that, at least by present day legal standards, constitute espionage.

*For purposes of clarity, "KGB" in this essay refers the Soviet intelligence secret police agency of that name from 1954-1991 and that organization's predecessors from 1917-1954.