Revolving-Door Politics

Hearst walked over and extended his hand. "Mr. Feilan, it's a pleasure to meet you."

"Mr. Hearst, I've heard much about you."

The two men took their seats.

Hearst leaned back against the sofa, one arm resting on the armrest, his gaze falling on Feilan's face. "Mr. Feilan, I've recently heard some interesting rumors. Some say the Emergency Banking Act and the Fireside Chat were both planned by you. Is that true?"

"I don't think that's a rumor."

Hearst's eyes narrowed slightly.

For that instant, he thought he had misheard.

According to information he had obtained from certain people at the Treasury Department, this young man was exceptionally modest.

Those who had worked with him during the Emergency Banking Act all said the same when speaking of him: he never claimed credit, always pushed the credit onto others, saying, "You were the ones who truly worked hard."

Hearst had assumed that, when faced with this question, Feilan would deny it, would be modest, would say: I only did a little.

But he had simply admitted it.

Cleanly, directly, without the slightest attempt to hide it.

Hearst suddenly realized that he seemed to be finding the young man before him harder and harder to fathom.

He paused, and that perfectly measured smile returned to his face. "In the United States today, there are very few young men as capable as you."

"Perhaps."

Feilan's voice was utterly calm.

Hearst caught the deeper implication beneath that flat tone.

Enough pleasantries. Get to the point!

"Very well, then I'll be direct."

Hearst leaned forward slightly, his hands folded over his knees. "I invited you here today because I'd like to ask you for a favor."

Feilan did not respond. He merely looked at him.

Hearst continued, "You know that the President and I are not merely partners, but friends as well. All these years, my newspapers have waved the flag and shouted for him, helped him strike down his opponents, and sent him into the White House. But recently, some cracks have appeared between us."

"After the inauguration, those reports... you saw them too. What I want the President to understand is that I wasn't targeting him."

Hearst sighed, and the sigh sounded quite sincere. "Sometimes, in my position, I have no choice either."

Feilan said nothing.

He had long guessed Hearst's purpose.

After the Fireside Chat, the foundations of Hearst's empire had been shaken.

The circulation of his newspapers had fallen. The public had condemned them for twisting public opinion and spreading false propaganda. The influence of his media empire was being eaten away bit by bit.

Now, he needed a channel—a channel through which he could approach Roosevelt again.

And Feilan was that channel.

"Of course, I won't ask you to help for nothing."

Hearst raised a hand and snapped his fingers lightly.

Carvalho, who had been standing silently in the corner of the living room, immediately stepped forward.

He carried a dark brown briefcase in his hand. The leather was fine, the brass clasps gleamed, and one glance was enough to tell that it was worth a great deal.

Carvalho placed the briefcase on the coffee table and gently undid the clasps.

The lid swung open, revealing what lay inside.

Several documents were neatly stacked within, each bearing a red seal.

Feilan lowered his head and glanced at them.

On the cover of the top document were several words: Hearst Group · Senior Consultant Employment Contract.

Beside it was another document, its cover reading: Hearst Group · New Share Subscription Priority Rights Confirmation.

"This is an employment contract for a senior consultant. You won't need to report to work, and you won't need to do any specific tasks. You'll only occasionally provide some... advice."

He paused. "An annual salary of one hundred and fifty thousand dollars."

Feilan's brow moved slightly.

One hundred and fifty thousand dollars.

In 1933, an ordinary worker earned less than a thousand dollars a year.

One hundred and fifty thousand dollars was equivalent to the combined annual income of one hundred and fifty workers.

It was enough to buy an entire apartment building in Manhattan.

Watching his expression, Hearst continued. "And this is priority subscription rights for new shares. Next week, the Hearst Group will issue a batch of new shares. Before the public offering, you can subscribe to a portion at the issue price."

"The issue price is twelve dollars per share. After the public offering, the market price is expected to be around twenty-five dollars."

"If you are willing to subscribe to ten thousand shares... then the price difference of one hundred and thirty thousand dollars will be yours."

Feilan lowered his head, narrowing his eyes at those documents.

An annual salary of one hundred and fifty thousand.

A new-share price difference of one hundred and thirty thousand.

Added together, two hundred and eighty thousand dollars.

Enough to turn someone, in that very instant, into one of the wealthiest people in the country.

And it was entirely legal.

A thought suddenly flashed through Feilan's mind.

In the United States, even in later generations, one rarely heard news of officials taking bribes or embezzling funds.

It was not because those officials were saints, but because the United States had its own unique system of "legal corruption."

That system had a name: Revolving-Door Politics.

An official at the Pentagon responsible for procuring weapons might appear incorruptible while in office.

Yet he would vigorously push for the purchase of a certain arms company's missiles, defend that company's products at hearings, and rack his brains to kick its competitors out of the running.

A few years later, he would leave office.

The very next day, he would appear on that arms company's board of directors.

The title on his business card would be "senior consultant," with an annual salary of several million dollars, or stock options worth tens of millions a year.

Would you call that corruption?

Legally speaking, no.

It was called "the flow of talent."

Everything he had done while in office had been "part of his duties," while his high salary after leaving office had been "market value."

No one could say he was guilty.

Because it was all "legal."

The stock market was the same.

In later times, insider trading was a serious crime.

But that was only for ordinary people.

Under a certain securities law, although members of Congress were nominally prohibited from trading on insider information, the penalty for violations was usually only two hundred dollars.

For those who could make millions through insider trading, what did two hundred dollars amount to?

It was merely the cost of doing business.

Not to mention now.

In this era, insider trading was not illegal at all.

Albert Wiggin borrowed money from his own bank to short its stock, made four million dollars, and could still say with perfect righteousness, "Everything I did was legal."

Feilan had not expected to be drawn into Revolving-Door Politics so soon.

Even though the concept of Revolving-Door Politics would not truly take shape until Joseph Kennedy became chairman of the SEC.

But so long as he was willing, he could accept these things now.

Accept them legally.

No one would investigate him, and no one could accuse him.

Two hundred and eighty thousand dollars would go openly and honestly into his pocket.

He raised his head and looked at Hearst.

Hearst was watching him, that confident, victory-assured smile on his face.

In Hearst's view, this deal was simple: the Emergency Banking Act had already settled into the dust, there was no longer any conflict between them, you help me play peacemaker, I give you some money, the money is legal, the matter is not difficult—why not?

Feilan gently closed the briefcase before him and pushed it back toward Hearst. "I'm sorry, Mr. Hearst, but I may not be able to help you with this."