Imperial German "Active Measures" and the Founding of the NSA
In my September 25th post “A Boy and the Law”, I wrote about Judge Willis Brown, the disgraced juvenile delinquency expert and personal host to hundreds of troubled teen boys on his Michigan estate. The first film Brown made about his estate, “The Boy City” (1910), was produced through the firm of early film tycoon Colonel William Selig, who signed Brown on shortly after his exposé as a fraud by Utah authorities.
Colonel Selig— who never served in the military— was a Catholic vaudeville performer who specialized in magic and minstrel acts. After seeing a kinetoscope show in Dallas, TX he decided to abandon his hand-to-mouth, itinerant lifestyle and become a movie camera and projector manufacturer. Just like that!
I’m only being partially facetious, as this miraculous transformation appears to be the extent of scholarly knowledge about how Selig Polyscope Company— Selig’s firm— was founded. In 1895, after seeing the Dallas picture-show, Selig committed himself to constructing his own motion picture camera and projector. According to Selig biographer Andrew Erish, in order to finance this endeavor Selig retooled his magic act to exploit the Spiritualist craze; took on night gigs as a magician; operated a commercial photography business; and made magic-lantern slides for vaudeville theaters. Many people struggled to support themselves doing all these things, but through them Selig was able to finance an industrial operation and culture business on his own, we are told. The truth is probably more complex, and involves Republican Party luminaries Mr. Philip Danforth Armour of Chicago and Mr. John Plankinton of Milwaukee.
Armour was a wealthy stockyard owner in Chicago who partnered with Mr. Plankinton during the US Civil War to supply meat to Union troops. They were wealthy before the war, but by its end they were fabulously so. Plankinton would expand into the hotel business, founding the iconic Plankinton House Hotel in Milwaukee.
In 1896, one year into his moving picture adventure, Selig began filming Chicago stockyards and selling the product to local movie houses. Selig went from strength to strength: in 1897 he rented offices between State Street and Wabash Avenue (he’d soon lease the entire building); in 1898 he made films about Teddy Roosevelt’s Spanish American War (remember those Rough Riders?); and by 1899 Selig was a major player in the industry.
Selig had connections in the Chicago Republican party and hence connections to Teddy Roosevelt, who as late as 1915 relied on Imperial German money to underwrite his political career. In 1900 Mr. Armour, by then a retired Methodist philanthropist whose brother was a Republican party leader, hired Selig to create promotional films of his meat factory, according to Erish:
At least fifty-eight short films were made, showing everything from the koshering of cattle to the scalding, scraping and decapitation of hogs, to sheep being lead to slaughter by a goat. The Armour promotional films remained on the market for a few years and would later prove to be the most fortunate co-production of Selig’s career.
While Armour made his fortune provisioning Civil War soldiers with meat, he is remembered for the scandal surrounding meat he sent for Teddy’s Spanish American War, which was described as “embalmed”. This awful business, along with nasty conditions at his Chicago factory, inspired Upton Sinclair’s 1906 novel “The Jungle”. Selig’s 1900 films would help Armour combat the bad press around his Spanish American War deals.
The success of Selig’s Armour films helped him incorporate his business in December 1900:
At the time of incorporation, the business was valued at $50,000 despite maintaining only a slim monthly profit. Unlike later motion picture companies, Selig’s business was always self-financed; during his first decade, the profits from a film often determined the budget for the succeeding one.
The above is probably true for Selig’s early (pre-1912) work, but for business after this date, Selig’s financing history flies in the face of his contemporaries’ experience, who found they needed outside finance to stay afloat, particularly finance from New York investment banks (and beneficiaries of the US Civil War) like Kuhn, Loeb & Co., which employed Otto Kahn as a partner.
Chicago’s Republican organizations were technology-forward using film to broadcast their message, as I discussed in H. E. Gilbert and the 1931 Goetz Theater. H. E Gilbert, who initiated the construction of the iconic Spanish Revival Goetz movie theater in Monroe, WI was business partner with Houston Bond, formerly maitre d’ at Chicago’s Hamilton Club, an elite Republican party social club with intimate ties to both Teddy Roosevelt and the early movie industry. Bond had also worked at the Plankinton Hotel in a similar capacity.
The 1931 Goetz Theater, in Monroe, WI. Its original plans were arranged by H. E. Gilbert around 1930.
A life-member of the Hamilton Club and a board director between 1901-1903, Mr. Isaac Miller Hamilton was also president and co-founder of the Federal Life Insurance Company, which employed Harry Aitken as its Wisconsin agent. It was Aitken’s earnings from Federal Life that partially financed his entry into the movie business.
Harry Aitken was the driving force behind the Chicago arm of the independent film company faction that challenged the ‘Edison Trust’, and later the “independent” monopoly formed by Karl Laemmle. Selig was not an independent— he was too big to be ignored— and by 1908 Edison had forced him to join the Trust through expensive litigation. To protect their own interests from Edison, Aitken and Monroe native John R. Freuler nurtured independent concerns Mutual Film, Arrow Film, American Film, and others.
In 1914 Aitken and Freuler made a movie celebrating the Imperial-Germany-funded agent Pancho Villa, directed by Humanitarian Cult member D. W. Griffith and paid for by Otto Kahn, who was also suspected of making loans to the German government. Griffith went down to Mexico to film Villa in person. Although the US government had supported Villa, the situation was tenuous, and in late April 1914 General Pershing was sent to the border against the bandit leader. Germany’s relationship with Mexico would be the immediate cause of US entry into WWI.
Long story short, Col. William Selig was in the right place, with the right friends, to benefit from Imperial German interest in early film as a vehicle to promote its propaganda in the United States of America. This activity falls within the (hazy) modern definition of “active measures”.
Things would get even hotter in early 1914 when Col. Selig joined with William Randolph Hearst to supply “pacifist” newsreels to US audiences. On March 8th, 1915 Hearst-Selig advertised the following, accompanied by a “full-length photo of von Hindenburg gazing squarely into the camera” (from Erish):
YOU CAN BE NEUTRAL
AND STILL SHOW
YOUR PATRONS THE
IDOL
OF THE
GERMAN ARMY
The master man on which the hopes of the German Empire rest— the man, who every day, bears the greatest weight of responsibility ever placed upon the shoulders of a human being—
Field Marshal
VON
HINDENBURG
The first motion pictures of this Colossus of the Military World, taken at Army Headquaters in East Prussia, by Staff Photographer A. E. WALLACE…
A 1914 image of Hindenburg, clearly not full length so not the one used by Hearst-Selig, however, this shows the ‘staring into the camera lens’ set-up that was a favored by the German General Staff. Courtesy of Wikipedia.
In 1916 when Hearst ended his partnership with Selig, Selig joined with the Chicago Tribune newspaper to continue his newsreel endeavor. (The Tribune was at this time run by Republican editor Joseph Medill.) From Erish’s biography of Selig: “The Selig-Tribune maintained a staff of war correspondents in the Balkans, London, France, Russia, Mexico and the Orient, along with a “camera-reporter” embedded with the German General Staff.” And naturally, Selig-Tribune covered Pancho Villa, for which they had a camera-train-car constructed, complete with steel shields and gun turret, so their camera crew could film the guerillas in relative safety. This news venture ended in 1917, with Selig losing the rest of his businesses in 1918.
Readers will remember that Monroe-native William Wesley Young worked for Hearst papers in Chicago until 1907. It is likely Young began work for British Intelligence around 1913.
So what does any of this have to do with the USA’s premiere signals intelligence organ, the NSA (“National Security Agency”)?
Well… Col. “von Hindenburg” Selig was good friends with another Chicago millionaire named Col. George Fabyan, heir to a politically-connected cotton-textile firm in Boston who had never been in the military either. In 1913 Col. Fabyan set up a research facility on land he owned near Chicago, which he named “Riverbank Laboratories”. In 1992, the NSA awarded Riverbank Laboratories a plaque, reading: “in recognition of the voluntary and confidential service rendered by Colonel Fabyan and his Riverbank Laboratories in the sensitive areas of cryptanalysis and cryptologic training during a critical time of national need on the eve of America’s entry into World War I.” The same source describes Riverbank as “essentially the antecedent to the NSA”, which is conservative, as both Fabyan’s cryptanalysis employees were head-hunted by the War Department and eventually assigned to lead, train and engineer what became the NSA. How did Riverbank get there?
In early 1916 Col. Fabyan and Col. Selig partnered in a cunning bit of press manipulation designed to generate interest in a book which Fabyan sponsored out of his Riverbank facility. This book claimed that Francis Bacon had authored Shakespeare’s plays and it used encrypted codes within the original “First Folio” printings of the plays to prove Bacon’s authorship. This was the genesis of Fabyan’s interest in cryptanalysis: that Bacon, the bastard son of the Virgin Queen and true heir to the British Crown (i.e. the current Windsors were imposters), authored the crown jewels of Britain’s literary heritage and that The Bard was nothing but a front— and that generations of British scholars had missed the clues.
Selig’s role in this press manipulation was to feign outrage that Fabyan’s book undermined the profitability of future Shakespeare-themed films which Selig was in the process of producing. Selig brought suit against Fabyan for damages. The judge in the case ruled against Shakespeare’s authorship— i.e. in support of Fabyan. A spokesperson for Selig is reported to have stated that the whole scheme was good for free press; consensus among historians agrees with this sentiment.
April 8th, 1916 article from film trade journal Motography.
1916 is an interesting time to attack one of Britian’s key cultural institutions and challenge the validity of the Windsor dynasty; Shakespeare’s plays could possibly be described as “soft-power” trump cards in modern lingo, while discontent over the Hanoverian Succession had been a national wound for centuries. Historically, the British have not responded kindly to theories about alternative (bastard!) identities for their national hero Shakespeare— who can blame them? The plays of Shakespeare have a particularly poignant meaning in German lands too, where for at least 200 years they were favored by anglophile, ‘reforming’ intellectuals.
Two decades earlier, Imperial German and Imperial British culture-vultures fought for supremacy on the battlefield of Italian Renaissance Art, which resulted in the British working with art critic/historian Giovanni Morrelli who discredited paintings in Imperial German collections, and the Germans firing back with Aby Warburg’s Kulturwissenschaftliche Bibliothek in Florence. The battle now raged over Francis Bacon and his Elizabethan ciphers. Fabyan’s point-women on the Shakespeare code was Elizabeth Wells Gallup, who had been trained at the University of Marburg— though as leaders in higher education, German university training was the norm for elite Anglophone scholars at this time.
Elizabeth Wells Gallup, courtesy Wikipedia Commons. Gallup was a persuasive, if reserved, communicator and an ardent salesperson for her theories.
While ensconced at Riverbank, Gallup did not work alone— she had two helpers, Elizebeth Smith and William Friedman, who would learn cryptography at Gallup’s knee. Both had been chosen for Gallup by Fabyan, and his selection methods deserve scrutiny.
Smith was twenty-three years old when she sought a job at Chicago’s Newberry Library because of her budding interest in Shakespeare. The Newberry acted as a recruiting agent for Fabyan, whom they called as soon as Smith made her request. Fabyan immediately came to the library and asked Smith if she would spend the night with him at Riverbank, she agreed. Smith asked if she could notify her parents of her whereabouts, Fabyan forbid it, yet she went with him anyway. Needless to say, Elizebeth Smith got the job— with no prior training in cryptography. Fabyan bought her a wardrobe that was more pleasing to him than the clothes provided by her Republican Quaker family and moved her onto his rural estate.
Riverbank had a bad reputation around Chicago for orgies and debauchery. Much like Col Selig’s performer Judge Willis Brown, Fabyan kept of colony of wayward youth— blond girls this time— borrowed from the nearby Illinois State Training School for Delinquent and Dependent Girls, whom he housed in a cottage with his name over the door. Fabyan considered the wives of his male employees to be available to him and went out of his way to find opportunities for talented young ladies like Smith. Guests to this libertine Xanadu included Teddy Roosevelt, Florenz Ziegfeld and his wife, Albert Einstein, as well as Lilly Langtry, the former mistress of Edward VII, who did so much to open London society to Lady Duff Gordon’s patrons.
“The early group at Riverbank, ca. 1916. Elizebeth Friedman (center), Elizabeth Wells Gallup, Kate Wells, Rita Curwell, Captain J.A. Powell.” Courtesy of the George C. Marshall Foundation. Elizebeth Smith would end up marrying her colleague William Friedman, hence her appellation as “Elizebeth Friedman”. It was not a love match.
Col. Fabyan chose William Friedman, a young man who was freshly trained as an agricultural geneticist, for very different reasons. In May 1915— nearly a year before his anti-British “Shakespeare” provokatsiya with Selig— Fabyan sent an unsolicited proposal letter to Friedman which contained the following statement (from Irwin L Goldman):
“I want the father of wheat, and I want a wife for him, so that the child will grow in arid country. Where did I get this problem? I got it from one of my wealthy Jewish friends, and if I can beat him to it, he will foot the bills and be damned glad to” (cited in Munson 2013).
Fabyan knew this problem would appeal to Friedman, because of Friedman’s background:
At Pittsburgh Central High School, Friedman was part of a debating society known as the “Emporean Philomath” (Clark 1977). There, among other topics, the members debated the merits of Zionism, the nationalistic movement that espoused the reestablishment of a Jewish homeland in Palestine. Zionism had sprung up in the 19th century as a reaction to anti-Semitism in Europe. The movement had an agrarian emphasis, whereby collective farms would be established so that a people who had largely been displaced from agriculture for thousands of years could return to work the soil. Friedman was passionate about these ideas, and this became part of his inspiration to enroll in Michigan Agricultural College in Lansing, MI in 1910 to study agricultural genetics.
Like the fictionalized “Willie Eckstein” of William Wesley Young’s Judge Brown movie “A Boy and The Law”, Friedman dreamed of opportunity and self-fulfillment through agriculture. At this time in Great Britain, the policies of Prime Minister Herbert Asquith sought to support the Ottoman Empire rather than the creation of a Jewish homeland in Ottoman lands. In 1903 the Colonial Secretary and “Tariff Reformer” Joseph Chamberlain had proposed to Austro-Hungarian Zionist journalist/activist Theodor Hertzl that the Jews establish a homeland in modern Uganda, then British East Africa, but Hertzl insisted on Jerusalem. In 1915 the British looked like poor prospects to US-based Zionists who wished to grow wheat in Palestine. A victorious Imperial Germany— or at least a humbled Britain— may have appeared more tractable on these issues.
Whatever Friedman thought Fabyan hired him for, it turned out that he was assigned to help Gallup with her Shakespeare cryptography. Along with Elizebeth Smith, who would become his wife, Friedman scoured Shakespeare’s texts for anything and everything that supported Gallup’s cryptographic theories.
Life at Riverbank was run like a cult, a “high control group”, lead by Col. Fabyan, a manic personality with grandiose ideas who respected no boundaries with his employees. Fabyan intercepted and read their mail; bugged the rooms in which they worked; and when Smith and Friedman decided to get married, they had to sneak away (not easy) and do it on the sly— not that it changed Fabyan’s urges toward Smith. A fragile man, Friedman took this situation meekly.
William Friedman in 1924, courtesy of Wikipedia.
We know something of the dynamic between Smith and Friedman because the NSA sent one of its agents, linguist Virginia Valaki, to interview the aging Smith for its “classified history files”— what the rest of the world would call its ‘official history’. This was important because of bad blood that existed between the Friedmans and the NSA— more on that shortly.
Between Agent Valaki’s recordings, and a journal Smith kept, we know that Smith said she married Friedman because she wanted to “win”— Smith figured love would eventually step in alongside familiarity. This emotional detachment was typical of Smith. When Friedman’s mother expressed violent, histrionic disapproval of his marriage to a gentile, Smith’s reply to her delicate husband was ‘I feel sorry for you.’ While the couple did have children, they were left in the care of nannies. When Friedman developed debilitating mental illness, Smith’s first concern was hiding her husband’s condition to protect his career with the NSA.
Perhaps the best explanation of Elizebeth Smith’s character comes through this quote from biographer Jason Fagone’s summary of Valaki’s interviews:
“The odious name of Smith,” she [Elizebeth Smith] called it once, in a diary she began keeping at the age of twenty. “It seems that when I am introduced to a stranger by this most meaningless of phrases, plain “Miss Smith”, that I shall be forever in that stranger’s estimation, eliminated from any category even approaching anything interesting or at all uncommon.” There was nothing to be done: changing her name would cause horrendous insult to blood relations, and complaining provided no satisfaction, because whenever she did, people asked why she didn’t just change her name, a response so “inanely disgusting” that it made her feel violent. “I feel like snipping out the tongues of any and all who indulge in such common, senseless, and inane pleasantries.”
It’s probably a good thing that Smith’s religious convictions prevented her serving on the front lines!
In early 1917 Fabyan lost interest in promoting Gallup’s work. In late 1916 Asquith lost power, and by January 1917 he had been replaced with Prime Minister Lloyd George, whose legal firm had a track record of working well with Zionist aspirations. Indeed, the Balfour Declaration would materialize under Lloyd George’s watch shortly thereafter. Fabyan’s new interest was promoting his cryptography department— Smith and her husband— to the US government for its WWI war effort.
The inevitable eventually happened— Mr. and Mrs. Friedman were recruited by the War Department. They thought that they had arranged this “escape”; they thought that Fabyan would be furious. However, when the pair broke the news to their employer, Fabyan smiled and wished them well. An explanation for this might be that William kept in close touch with Col. Fabyan throughout his career with the US intelligence community. Fabyan was exactly the type of man to know what to do with such information.
Prior to establishing Riverbank, “Fabyan had served as informal consul to the Japanese government before the official consulate in Chicago was developed (Munson 2013). Over the years, Fabyan hosted many Japanese dignitaries and built an expansive formal Japanese garden.” (Quotation from Goldman.) Fabyan was also instrumental in the peace negotiations between Russia and Japan after the Russo-Japanese War, during which Humanitarian Cult backer Jacob Schiff gained fame for supporting the Japanese. Col. Fabyan kept his own private militia at Riverbank and never lost an opportunity to ingratiate himself to US military and intelligence leaders.
But what sort of a career did Fabyan’s employee William Friedman have inside the US intelligence community? We know that Friedman, supported/coached by his wife, established the first personnel and systems of the NSA. There is no shortage of sources extolling the couple’s work. However, they inspired strange comments from acolytes, for instance (from Fagone):
But the reality is that they [Smith and Friedman] were both mathematical neophytes, even William. A future colleague of William’s, Lambros Callimahos, a classical flutist and trained mathematician, idolized William to the point of copying his personal habits; upon learning that William like to use tobacco snuff, Callimahos took up snuffing. But Callimahos recognized that whatever made William good had little to do with math. He described William as a man “cursed by luck”, writing, “Even if he computed odds incorrectly, it didn’t make any difference because he would forge ahead in his blissful ignorance and solve the problem anyway.”… Their brains [Smith and Friedman’s] were Easter Island statues, stony and imposing. Colleagues resorted to mystical analogies.
That Fagone and the Friedmans’ colleagues would use “mystical analogies” to describe the “luck” of the couple is fitting, as for most of history cryptography has been married to the occult— while enjoying a long-standing affair with commerce on the side. Rather than being a mathematician, history suggests that a good cryptographer should understand the psychology of occult circles and the languages/networks of international trade. We can be confident that there is more to the Friedmans’ story than is publicly known.
Some insight may come from Smith’s later career, which was more torturous than her husband’s. The Navy consistently courted Smith for her services, but for some unexplained reason she had a pronounced disdain for that branch of the military. Instead, Smith chose to work for Henry Morgenthau Jr. at the US Treasury through the inter-war years; her devotion to Morgenthau was deep. We met Morgenthau earlier through his connection with The Humanitarian Cult during its hawkish stage in 1917.
While working for Morgenthau, Smith focused on busting bootleggers’ codes, specifically those of the Vancouver-based Consolidated Exporters Corporation, which was partly owned by “Joseph Kennedy” (probably P. J. Kennedy), grandfather of the assassinated US president. Smith noted that the codes used by the Kennedy bootleggers were similar to those used by German spies during WWII.
US and UK cryptographic work on the “Enigma” machine is covered extensively elsewhere, but as William Friedman’s mental health deteriorated, his wife took an increasingly prominent role in the intelligence community. In 1957, just after the intelligence-sharing UKUSA agreements had been finalized, the Friedmans wrote a book claiming they never really believed in any of Gallup’s Shakespeare claims, and that the now-dead woman read whatever she wanted into the texts. As an example, the Friedmans challenged that Gallup’s deciphered phrase “IF HE SHALL PUBLISH” could just as easily been deciphered as “IN HER DAMP PUBES”.
The charming couple in their Capitol Hill library, courtesy of Penn State University.
By the late 1950s the Friedmans had amassed a considerable collection of information on US signals intelligence in their personal library, and this was the spark which ignited their conflict with the NSA as the organization grew outside the Friedmans’ (Elizebeth’s) control, from Fagone:
The government came for their books on an otherwise ordinary Tuesday in 1958… William and Elizebeth were inside their home on Capitol Hill and heard a knock on the front door. They opened it and saw at least three men from the government. Behind them, on the street, was a rented truck, as if the men planned to remove something large from the house…. One of the men, S. Wesley Reynolds, was the NSA’s director of security. A second man worked for Reynolds, and a third worked for the U.S. attorney general.
The men asked to see the home library….To the horror of the Friedmans, the men started to pull things off the shelves. They removed forty eight items…
Apart from cryptographic manuals, the Friedmans had been storing unspecified information about WWI in their home. Already in fragile mental health, William Friedman developed a “full-blown paranoia” about the NSA and his creation’s intentions toward him. Fagone hints part of the NSA’s concern was due to the Friedman’s political affiliations in the McCarthy era. Certainly, like many of the CIA’s leaders, the Friedmans were zealous adherents to the personality cult around Franklin Delano Roosevelt. At the very least, their daughter Barbara was involved in “Leninist” agitation in NYC in 1941:
Barbara was between semesters of college and living in New York City, in an apartment on West Fifty-sixth Street, getting involved in leftist political causes and dating an activist named Hank. “Hank is beautiful,” she wrote to William [her father, William Friedman], “but we’re so utterly different. He lived in the slums and led a gang (because he’s the tallest and the biggest) and hated cops and swam in the East River…. And now we go to bars and stand at the rail with the workmen and talk about Leninism.”
William had no interest in Leninism but told his daughter she had a good heart.
Personally, I think it’s entirely reasonable that the NSA claim any materials in the Friedmans’ possession relating to their government cryptographic work— but that didn’t fit in with Elizebeth’s idea of ‘winning’. She would remain bitter about her loss of control for the rest of her life, which is probably what induced the NSA to send round Valaki for interviews in the 1970s.
What I hope that I’ve communicated in this post is how close the powers that created the NSA actually came to serving Imperial German interests during WWI.
[You live] in the secret parts of Fortune?
O, most true; she is a strumpet.
(Hamlet, 2.2.235), Hamlet to Guildenstern
