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INTRODUCTION: THE EARLY HISTORY OF THE CFR

The Council on Foreign Relations in recent decades has become a much different organization than it was when it was established and incorporated in the 1918–1921 period. Nevertheless, origins do matter, and the CFR’s beginnings and first half-century of existence set key patterns that still exist today.

THE ORIGINS AND EARLY DEVELOPMENT OF THE COUNCIL

The Council had its origins in the uniting of two different fledgling groups during the post–First World War era. The first, established in 1918, was the New York club called the Council on Foreign Relations. It had only 108 members, dominated by high-ranking Wall Street financiers and international lawyers. Its aims were to explore the effect of the war upon business and promote commerce. Its means were networking conferences and dinners hosting prominent foreign visitors.⁹ The second organization grew out of the postwar planning body—mainly made up of intellectuals—set up by President Wilson’s aide Edward House with the help of Walter Lippmann and others for the benefit of the 1919 U.S. peace delegation at the Versailles Conference. This group was called “The Inquiry.”

Attending the conference, the group of planners met separately with members of the British delegation and decided to continue the Inquiry by forming a permanent Anglo-American Institute of International Affairs with two branches, one in each country. The plan foundered on the American side, but the British group formed what became the Royal Institute of International Affairs (Chatham House). After almost dying, the long-term Inquiry project was revived by joining with the established Wall Street group. The result was the incorporation of the Council on Foreign Relations under the laws of New York in 1921. It represented a synergy of internationally oriented corporate business interests and university-based academics: men whose goal was capital accumulation and men focused on ideas. The new CFR became the sister organization to Chatham House and the two organizations have had a close cooperative relationship ever since, each helping the other in “a hundred different ways.”¹⁰

The new Council had a fifteen-man board of directors and an honorary president in the person of Republican Elihu Root, the leading Wall Street lawyer of the era. Root had not only served as counsel for many leading corporations, he personally had advised powerful political and economic actors like Theodore Roosevelt, Andrew Carnegie, Jay Gould, and E. H. Harriman. One of the early revolving-door players, he had moved in and out of government and private law practice, serving as a U.S. senator, as President McKinley’s secretary of war, and President Roosevelt’s Secretary of State. In these capacities he had played a central role in designing colonial and neocolonial policies in places like the Philippines and Cuba as the United States intensified its imperialist expansion during the end of the nineteenth and first decade of the twentieth century. The president of the new CFR was John W. Davis, an attorney for the leading finance capitalist of the age, J. P. Morgan. He was later, while still president of the Council, the 1924 Democratic nominee for president.¹¹ The new vice president, Paul D. Cravath, and secretary-treasurer, Edwin F. Gay, were also J. P. Morgan-connected. Cravath’s law firm worked for Morgan, and Gay, a former Harvard professor, was editor of the New York Evening Post, owned by Morgan partner Thomas W. Lamont.¹²

Among the new directors of the Council was Archibald Cary Coolidge, a Harvard professor who had been part of the Inquiry and was from a prominent and wealthy Boston family, one that went back to involvement in the nineteenth-century China trade. He was asked to become the editor of the CFR’s new flagship magazine, Foreign Affairs. He only consented to take the responsibility if he could have a full-time assistant. Gay recommended one of his young reporters, Hamilton Fish Armstrong, a Princeton man whose ancestors not only included Hamilton Fish, President Grant’s Secretary of State, but also Peter Stuyvesant, a major figure in the early history of New York City. Armstrong eventually took over Foreign Affairs, serving as its editor from 1928 to 1972, as well as a Council director during the same forty-four-year period.

Root, Davis, Cravath, Coolidge, and Armstrong were all representatives of the old money/prominent families/high society set, and were all listed in the Social Register (SR), long considered the definitive guide to who is in or out of the upper class.¹³ A very large representation of SR listees among its officers and directors was a prime characteristic of the early CFR. All seven of the Council presidents during the period 1921–1971 were from families listed in the SR, as were both honorary presidents, the first three chairmen of the board (1946–85), and the first three vice chairmen of the board of the CFR (1971–78).

Other leading capitalists, not listed in the SR, were also on the Council’s founding board. Two examples are Otto Kahn and Paul M. Warburg, both major Wall Street investment bankers with Kuhn Loeb and M. M. Warburg, respectively. Both were economic competitors with J. P. Morgan—Kuhn Loeb was considered the second most prestigious U.S. investment bank behind Morgan, for example—but they worked together with Morgan-affiliated men in the CFR. Kahn’s wealth was legendary; in 1919 he had a 127-room castle built on his Long Island estate, then the second-largest private residence in the entire country.

Coolidge, Gay, and Professor Isaiah Bowman of Johns Hopkins University were the most prominent representatives of the Inquiry-affiliated and scholarly sector of the CFR on its first board of directors. But the professional-class intellectuals have never held the top office at the CFR, and have always been, down to the present, a minority on a decision-making board of directors dominated by members of the capitalist class. An interesting aspect of this upper-class control is the shift, in the early 1950s, in the top leadership of the Council. Until 1953 the final decision maker, president until 1946, then chairman of the board after then, was always Morgan-connected. For example, Morgan partner Russell Leffingwell was chairman from 1946 to 1953. Beginning in 1953 and continuing until 1985, the chairman of the CFR was Rockefeller-connected: first John J. McCloy from 1953 to 1970 and then David Rockefeller from 1970 to 1985. Both McCloy and Rockefeller also served as chairman of the Rockefeller-controlled Chase Manhattan Bank while they chaired the Council.

One area where the intellectuals had greater influence was the implementation of the long-standing CFR goal of guiding American opinion and political-economic strategy toward a large, even dominant role in world affairs. Gay expressed the general perspective as early as 1898 when he wrote: “When I think of the British Empire as our inheritance I think simply of the natural right of succession. That ultimate succession is inevitable.”¹⁴ In a Council-published history of the organization, written by member Peter Grose, CFR president Leslie H. Gelb stated that from an early date “Council members have shared the conviction that Americans must know the world and play a leading role in its affairs.”¹⁵

THE CFR PROGRAM, 1921–1970

From almost the outset, the Council organized a meeting and study program, operating out of its headquarters on the prestigious Upper East Side of New York. The meetings program was mostly to create a “continuous conference” on world politics and U.S. foreign policy, hosting domestic and foreign leaders in mainly off-the-record sessions for CFR members. The first major meeting was the appearance by former prime minister Georges Clemenceau of France in November 1922. From 1921 to 1938, every U.S. secretary of state made at least one important foreign policy address at the Council.¹⁶ When a new CFR headquarters building—a house donated by the Pratt family whose fortune stemmed from Standard Oil—was opened in April 1945, Secretary of State Edward Stettinius, a Council member, traveled to New York “to bear witness, as every secretary of state during the past quarter of a century, to the great services and influence of this organization.”¹⁷

Central to this “service and influence” was the studies program, the CFR think tank. This was, over the years, its most important activity, providing ongoing strategic thinking about how to solve the practical problems relating to the expansion of U.S. economic and political power abroad. Here is where the theoretical ideas of Council scholars were applied to the needs of industrial and financial interests as well as the state. The work of the CFR gradually became “a program of systematic study … to guide the statecraft of policymakers.”¹⁸ The way that this worked was that representatives from key sectors of society—especially academic intellectuals, corporate leaders, and government personnel—would be assembled in a study group that would focus on an issue, a nation, or a region. Following regular meetings for a year or more, one member of the group would take responsibility to write a book or article, representing his own personal view, but also coming out of the collective work and thinking of the group. As an organization dominated by the largest and most powerful industrial and financial groups—first J. P. Morgan and Kuhn Loeb, later the Rockefeller economic empire—it was natural for the CFR to promote an expansionist American foreign policy, aimed at maintaining a status quo at home by expanding abroad. More specifically, the powerful saw an increase in trade and investment as the solution to domestic problems like unemployment. As CFR director Bowman expressed it in 1928, foreign raw materials, imports, and exports were required “if we are to avoid crises in our constantly expanding industries.”¹⁹ Not surprisingly, one of the very first Council publications aimed at encouraging economic expansion abroad. This was Foster Bain’s 1927 volume, Ores and Industry in the Far East, which came out of a 1925–26 study group at the CFR.²⁰

The Second World War and the War-Peace Studies

The Council and its program reached one of its historic peaks with its work on setting U.S. foreign policy and war aims during the Second World War. This war and the subsequent Cold War were decisive events, marking a turning point toward full-blown U.S. imperialism and beginning a process of organizing the global political economy in a top-down fashion with the United States as the hegemonic power.

The CFR, its leaders, and members were at the center of efforts that defined the monopoly capitalist class “national interest” during this era, working out the strategy to implement the ensuing policy goals. During the war, this work was conceived and carried out by a special Council study group, called the War-Peace Studies. Almost 100 men worked on this Rockefeller Foundation funded effort, engaging in organization, research, analysis, discussion, and writing from 1939 until 1945, producing a total of 682 memoranda for President Roosevelt, the State Department, and other branches of the U.S. government. Midway through the war, a number of the CFR planners were brought into the State Department part-time to help officials set postwar policy.²¹ Collectively, the body of work produced by the War-Peace Studies defined the U.S. “national interest” in a status-quo fashion, based on the percentage of the world necessary for the country to prosper without fundamental changes in the capitalist property ownership and “free market” system. Not surprisingly, most of the world was seen as needed as economic living space for such a system, meaning that the United States would have to go to war with and defeat Japan and Germany and then begin to reorganize the world as an informal empire beneficial to American and allied capitalist interests.

Postwar Focus on Containing and Overthrowing the Soviet System

Following the Second World War, the continuing existence of the USSR and its allies stood as a partial roadblock to U.S. global ambitions, and for the following several decades, this challenge was always near the center of Council concerns. Furthermore, the organization had a key impact on U.S. policies. In his semi-official history of the Council, Peter Grose stated that in the postwar period the Council’s study groups “served as an important breeding ground for the doctrines … that guided American foreign policy for the years of the Cold War.”²² This guidance involved “public enlightenment” through varied channels, including CFR-linked committees in many cities around the country, but also service in government by the “in-and-outers,” Council people who move in and out of high government office and their private endeavors in finance, business, law, academe, foundations, other think tanks, and the media. As the 1951 CFR Annual Report expressed it:

In placing emphasis on public enlightenment, however, it is not intended to suggest that the Council has no function in the evolution of foreign policies themselves.… The roster of Council members who now occupy high office is impressive. Many of them spent long hours in Council study and discussion groups when they were private citizens, and some still participate actively in the work of the organization.²³

Whether in government or at the CFR, these “wise men of foreign affairs” think in terms of their own “national class interest” and resulting grand strategy for the U.S. government.

The CFR dedicated a large portion of its efforts to understanding and countering its Soviet opponent and actual or potential allies. For example, Foreign Affairs magazine printed no less than 248 articles on Russia and the USSR during the long tenure of Hamilton Fish Armstrong as editor, including the famous 1947 “containment” article on the “Sources of Soviet Conduct” by Council member George F. Kennan.²⁴ The general thinking behind the Marshall Plan, the key government figures putting the plan together, and the “citizens organizations” working to gain public support were all closely linked to the CFR.²⁵ Allen W. Dulles, a SR listee and a central figure in the U.S. government’s anti-communist crusades of the 1950s and early 1960s as CIA director (a leader of coups in Iran and Guatemala, as well as failed attempts to overthrow the Cuban Revolution), was continuously a director of the CFR from 1927 until he died in 1969. He was also successively the Council’s secretary (1933–44), vice president (1944–46), and president (1946–50). Allen’s brother John Foster Dulles, Eisenhower’s secretary of state, was also a CFR member, and chose the Council as the venue to announce the U.S. government’s “massive retaliation” nuclear doctrine against the USSR on January 12, 1954. This doomsday policy evidently gave rise to some doubts within the Council, which convened a group to study the question. A young Harvard University academic named Henry A. Kissinger was invited to chronicle the work of the group and spent the 1955–56 academic year at the CFR.²⁶ The resulting famous 1957 book by Kissinger, Nuclear Weapons and Foreign Policy, suggested a modification of the Dulles-Eisenhower policy toward one that suggested gradual escalation, including the possible use of tactical nuclear weapons.²⁷ Kissinger himself later retreated from this doctrine, taking a more sober view of the dangers to humanity represented by nuclear escalation. The junior academic met the Rockefellers and other powerful men at the Council and was on his way toward later prominence. Kissinger and the CFR also played a central role in the shift in U.S.-China policy during the 1969–72 years, moving away from a more dogmatic anti-communist policy to a more flexible one in which China could be used as part of a complex geopolitical power game involving the USSR and other states.²⁸

War over Southeast Asia and Vietnam

The U.S. invasion of Vietnam and the resulting foreign-policy disaster of 1964–73 also reflected the anti-Soviet perspectives dominant in the CFR. But more important, it involved the longtime interest of Council leaders and planners in Southeast Asia as an important geopolitical and geoeconomic region, one where U.S. “vital interests” were so involved that the area was strategically important to keep within the U.S. sphere of influence. The CFR was able to set the basic assumptions, alternatives, and framework for policy that gained capitalist-class consensus, eventually resulting in a U.S. military adventure with an immense loss of human life and treasure. Setting the framework for policy began with the War-Peace Studies in 1940–41, but intensified in the 1950s when the Council had no less than five different study groups focused on Southeast Asia. Typical was the 1959–60 study group headed up by CFR members Harlan Cleveland and Russell H. Fifield, whose conclusions were summed up by Fifield in a 1963 CFR book called Southeast Asia in United States Policy, stating that the area was “of great strategic, economic and demographic significance … of special significance in the world balance” because of the importance of its raw materials and markets.²⁹

The U.S. government, led by Council men, naturally adopted the imperialistic CFR perspective and went to war based on this analysis and the resulting consensus view of the national capitalist class interest.³⁰ After several years of intense military engagement, and with the war not going well, the Council’s inspired consensus began to fall apart, leading to a remarkable turnaround in U.S. policy in early 1968. CFR men, including Chairman John J. McCloy, were dominant in the private “Senior Advisory Group on Vietnam” that for several years had advised President Lyndon Johnson to escalate the war, but then in 1968 urged Johnson to de-escalate and seek a negotiated peace.³¹

THE PASSING OF THE OLD GUARD: FINE-TUNING THE CFR

By the late 1960s and early 1970s the CFR was facing an aging problem, as a number of key directors and a large number of members were near or past normal retirement age. Some length-of-service records of some of the directors, almost all of them members of the old plutocracy, were extraordinary: Whitney Shepardson was a director for 45 years (1921–66); Hamilton Fish Armstrong for 44 years (1928–72); Allen Dulles for 42 years (1927–69); Frank Altschul 38 years (1934–72); and William A. M. Burden for 29 years (1945–74). One CFR fellow wrote an article about the Council in New York magazine in 1971, focusing on how the organization—“the citadel of the establishment”—was increasingly out of touch:

If you can walk—or be carried—into the Pratt House, it usually means you are a partner in an investment bank or law firm—with occasional “trouble-shooting” assignments in government. You believe in foreign aid, NATO, and a bipartisan foreign policy. You’ve been pretty much running things in this country for the last 25 years, and you know it.

But today your favorite club is breaking up, just on the eve of its fiftieth anniversary. The same vulgar polarizations that have popped up elsewhere—young against old, men against women, hawks against doves—have at last invaded the secluded Pratt House and citadel of the establishment itself.… The Council’s leaders, and most of its members, are affluent New Yorkers from the financial and legal community—the establishment heartland.… Increasingly, they look and act like fossils.… The Council is stuffy and clubby and parochial and elitist, but it is a place where old moneybags and young scholars are able to sit down and learn something from each other. It is pompous and pretentious, but it still draws men of affairs out of their counting-houses and into dialogue with men of intellect. It is quaint, but not quite yet a museum-piece. It would be a pity, I thought, if it should die.³²

Although the CFR was hardly “breaking up,” or in any way losing its power, there was an atmosphere of crisis during the early 1970s due to the dissent of some of the younger members against the Vietnam War, and the fact that the Council was still an all-male organization with a high average age among its members. With 1,467 members in 1970, the CFR was a large organization, but it was soon to become much larger, this being necessary to acquire younger members, admit its first women, and gradually create a more diverse Council.

The other central issue was bringing into the Council a representative group from the large nouveau riche plutocratic class that had rapidly grown up during the post–Second World War economic boom. This boom had greatly increased the number of millionaires in the United States, reportedly by as much as ten times between the mid-1950s and the mid-1970s. The Council is an organization of, by, and for the plutocracy—and, as indicated by its history, membership, and top leadership, very attuned to the need to incorporate the leading capitalist class families. Therefore the newly rich element of the United States had to be, as much as possible, brought into the fold. To be sure, in the 1960s and 1970s the top leadership of the CFR was still dominated by members of the old plutocracy, as measured by listings in the SR. The membership also had a large representation from America’s richest old plutocratic families. For example, a quick review of the Council’s 1970 Annual Report finds four members of the Rockefeller family, and also top men from the Morgan, DuPont, Mellon, Vanderbilt, Cabot, Duke, Roosevelt, Whitney, Dodge, Milbank, McCormick, Payson, Houghton, Schiff, Reid, Guggenheim, Root, Watson, Harriman, Aldrich, and Dillon families.³³ These and other plutocratic families are the ones listed in the SR and discussed in such classic studies of U.S. wealth as Ferdinand Lundberg’s America’s Sixty Families,³⁴ as well as more recent works like Millionaires and Managers by S. Menshikov, Wealth and Democracy by Kevin Phillips, and The Founding Fortunes by Michael Allen. The newly rich tend to look up to and get their prompts from the old rich, so as the CFR organization was fine-tuned after 1970, much remained the same, the old and new plutocracy met, mingled, and merged at the Council, resulting in an organization more representative of the U.S. plutocracy as a whole, and therefore more united, strengthened, and even more powerful.

This brings up a key, and still very relevant point, namely that the CFR is not only a place where the capitalist class meets to discuss its own and our planet’s future; it is also a place where others outside the circle of great wealth, especially intellectuals, are brought into the dialogue and assimilated in order to assure capitalist-class hegemony. As this book will illustrate in depth, this blending together of leading men and women of wealth and economic power with men and women of brainpower is a central part of what makes the CFR unique and so important. The Council is both a membership organization and a think tank, marrying action and reflection. Its life and activities are made possible through a membership that is a delicately balanced combination of leaders of capitalist businesses, leaders of status-quo intellectual life, and leaders in government. If any of these three main components get too weak or too strong in the CFR, the organization begins to lose what it considers to be its true character. So as Council leaders managed the gradual changes needed to maintain and increase their power, prestige, and influence, they had to choose future leaders as well as new members accordingly.

The changes after 1970 also took place under the chairmanship of David Rockefeller, the epitome of an old plutocratic figure. The colossal wealth and resulting power of Rockefeller gave him, in the eyes of many, a supernatural aura. What Stewart Alsop wrote about David’s brother Nelson (also a CFR member) applies to the entire plutocracy, and especially to David Rockefeller: “People who meet Nelson Rockefeller are always aware of the dollar sign that floats conspicuously above his head. It is there but one must not mention it. Having that invisible dollar sign hovering above his head tends to hedge a Very Rich man off from his fellows, as divinity doth hedge a king.”³⁵

Wall Street’s Think Tank has two main sections. Part I will follow up on and deepen the sketch of the CFR offered above with one chapter on the Council as a capitalist-class organization and another that details the changes at the CFR beginning in 1970. The domestic and international networks of the Council will also be reviewed.

Part II will cover the CFR worldwiew and its central role in creating the current imperial neoliberal geopolitical world order, with an overview and a number of case studies, including a detailed examination of the U.S. war on and occupation of Iraq. The final chapter will discuss the dangers posed to our planet and humanity’s future by the irrational national and global system of neoliberal geopolitics that the Council has been so important in creating and maintaining.