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Agents of Influence
A British Campaign, a Canadian Spy, and the Secret Plot to Bring America into World War II
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‘Foreign influence is truly the Grecian horse to a republic. We cannot be too careful to exclude its influence.’
Alexander Hamilton, 17931
‘Dreamed of, aimed at, and worked for, and now it has come to pass.’
Winston Churchill on the US entry into war, 19422
As a child, I remember hearing about the man who saved my father’s life. It happened an ordinary summer’s day, several years before the start of the Second World War. My grandparents had taken their accident-prone three-year-old, my Dad, to have lunch with a friend of theirs outside London. After the meal my grandmother was walking in the garden with the man they had come to see, Bill, when he asked where her son was. She had no idea. Without a word Bill raced over to the far side of the house, where there was a deep pond covered with a carpet of waterlilies.
From here the story I heard as a child might take a slightly different shape, depending on who was telling it. Bill arrives at the pond out of breath to find three-year-old Dad either walking into the water, drowning, or in the most colourful version he has disappeared beneath the waterlilies. Bill then wades, jumps or dives into the pond in his clothes, before staggering out with a spluttering child in his arms.
I remember this being my favourite part of the story, and the rush of relief I would feel at hearing that Dad had survived, and could go on to meet Mum, and my sister and I could be born. As the outline of this episode became more familiar with time, I began to feel as well a tacit bond to the hero of this tale, Bill, who went on to become Dad’s godfather. What he had done seemed to telescope the years between us, and it was strange to think that my life had hung for a moment on the actions of this elliptical figure, someone I knew very little about and would never meet.
Another story I heard about this man was that during the war he had asked my grandmother to work for him as a spy. But the best story about Bill – or William Stephenson, to give him his full name (not the name he was born with, for reasons we will get to) – was not one I remember being told. It was about how he was taken on by MI6, Britain’s foreign intelligence agency, and sent to New York in 1940 on a controversial mission. He was to set up and run a secret British influence campaign that would change American public opinion and bring the United States into the war.
This is the story of the largest state-sponsored influence campaign ever run on American soil. Covert, sophisticated, eye-wateringly expensive, this undercover British operation has been described as ‘one of the most diverse, extensive, and yet subtle propaganda drives ever directed by one sovereign state at another’.1 The Washington Post called it ‘arguably the most effective in history’, ‘a virtual textbook in the art of manipulation’, and one that ‘changed America forever’.2 It has been linked to the birth of not only the CIA but the modern conservative movement in America. The figure running it, Sir William Stephenson, ‘Bill’ to his friends, the man who saved my father’s life, later became known to the world as the ‘man called Intrepid’. He was also hailed by Ian Fleming as one of the inspirations for James Bond.
But this Bond-like figure was not everything he claimed to be, nor was the operation he ran. Only now, with the release of newly declassified British records from the Foreign Office and the wartime special operations agency, the Special Operations Executive (SOE), and an array of corroborating material in American archives, is it possible to strip away years of historical bluff and bluster and tell the story of what Stephenson’s undercover operation really achieved in the months leading up to the Japanese attack on Pearl Harbor.
By the time that happened, early on 7 December 1941, Stephenson was running what a CIA historian has called ‘the largest clandestine foreign intelligence station ever established in the United States’.3 At its peak this office employed just under one thousand agents, intermediaries, analysts, clerical staff, pressure-group leaders, journalists, pollsters, agent-runners, campaigners and document forgers, as well as two would-be assassins, an overweight astrologer called Louis and a female spy described by Time magazine as the ‘Mata Hari from Minnesota’.4 In the months before the United States entered the Second World War this unlikely team fed into the American news cycle a stream of ‘fake news’, as it was known then and now; they hacked into the private communications of US senators and representatives, produced forgeries, subsidized and directed protest groups, manipulated opinion polls, organized protests and wiretaps, and otherwise harassed those who stood in their way. At the time, many Americans suspected the British were up to something and imagined there might be collusion with the White House. Few could have guessed either the extent of what was going on or the impact it had.
When this British influence campaign came to life, shortly after the evacuation from Dunkirk in June 1940, one poll suggested that just 8 per cent of the American population wanted to go to war.5 Eighteen months later, just weeks before Pearl Harbor, another poll showed that more than two-thirds of Americans had decided it was time to go to war against Nazi Germany.6
What happened then has a particular resonance now. For as long as we live in open and democratic societies there will be the concomitant risk of state-sponsored subversion on this scale, as the British showed in 1941 and as the Russians reminded the world during the 2016 US presidential election. Vast sums have been spent, and no doubt continue to be spent, on undercover operations designed to change the way people somewhere in the world think about a volatile political issue. These efforts to ‘shape reality’, to borrow from the motto of a modern-day company specializing in this work, are becoming a motif of our age.7 Usually when we read about an influence campaign the story is told from the outside looking in. What we now know about the British wartime operation in America, ‘a thorough, classical case of covert political warfare’,8 is different, and gives us a rare chance to step inside one of these covert operations.
‘Fake news’ has a long pedigree in American history. In the 1660s, in Kentucky, you could be fined up to 2,000lbs of tobacco if found guilty of spreading ‘false news’.9 By 1940, the term ‘fake news’ was being used in the press to describe invented or wilfully exaggerated news stories designed to serve a political agenda. The same is true today, even if the term has become more politicized than ever. Sometimes we worry that fake news has been planted by individuals, organizations or governments in an attempt to change the way we think. What follows is an account of when that happened on an unprecedented scale, and how it changed both America and the course of the Second World War.
At its heart is a human story centred on two men whose lives were changed forever by the decisions they made in the frantic months leading up to Pearl Harbor. One was Bill Stephenson of MI6. The other was America’s best-known anti-war campaigner, the legendary pilot Charles Lindbergh. By the start of 1941, the British intelligence officer and the American icon were dug in on opposite sides of what had become a civil war of ideas. Throughout the United States the ‘Greatest Generation’ was caught up in the ‘Great Debate’. What began as an argument between the ‘interventionists’ and the ‘isolationists’ about whether to go to war had become, by December 1941, as much about the European conflict as it was to do with race, immigration and, ultimately, what it meant to be American.
At stake for Stephenson and Lindbergh was the fate of their respective countries. In the heat of the historical moment they had to decide how much they were willing to risk, and just how far they would go. As much as this book is the history of an influence campaign and the way millions of Americans were encouraged insidiously to change their minds on a vital and divisive issue, it is also the story of how two flawed individuals reacted to the strange situation in which they found themselves, and how the choices they made went on to change the world around them.
11 JUNE 1940
Days Britain at war – 282
Allied shipping losses in the Atlantic (to date) – 1,135,263 tons
British Army strength – 1,650,000 men
German Army strength – 4,347,000 men1
18–23 MAY 1940
Gallup Survey: Do you think the United States should declare war on Germany and send our army and navy abroad to fight?
Yes – 7%2
From a distance, there seemed to be nothing unusual about the ocean-going liner MV Britannic as it prepared to sail for New York. Over the ship’s engines came the customary shouts of stevedores as the last of the cargo was loaded up from the Liverpool docks. A tang of petrol cut through the sea air, and beyond the colonnade of cranes you could see the Irish Sea, a glittering block of molten blue, reassuring in its familiarity. Everything was as it should be, except it was not.
On board the Britannic that day was a small army of workmen employed by the British government, more than a hundred children in sailor suits or starched white frocks, many of them holding teddy bears the size of lifejackets, at least sixty dark-suited diplomats, and two members of the British royal family, while down in the hold of the ship lay more than seven hundred crates of gold bullion, worth today just over £500 million. This mountain of gold and most of the men on the Britannic had one thing in common. All were being sent to the United States as part of a desperate, last-ditch effort to save Britain from defeat. The same was true of the British spy who had just stepped on board.
It was the morning of 11 June 1940. Britain was already at war with Germany, and by the end of that day would also be at war with Italy. As the translation of Mussolini’s latest speech was typeset for the evening papers, Allied forces in northern France continued their retreat. Before them, young German men, some wide-eyed on methamphetamine, steered planes, tanks, horses, armoured vehicles and motorbikes deeper into enemy territory. Around them the world seemed to be falling in on itself. Poland, Denmark, Norway, Belgium, and Holland had been defeated. Now France was on the brink. After that, surely, Hitler would turn to Britain.
Earlier that day the country’s new prime minister, Winston Churchill, just one month into the job, had written to the President of the United States, Franklin D. Roosevelt: ‘We are preparing ourselves to resist his fury and defend our Island.’1
Island with a capital ‘I’. In the urgency of the moment it was as if the British Isles had transcended geography to become a single sceptred isle, the citadel about to be stormed.
The next day, the prime minister would turn to a general and say, ‘you and I will be dead in three months’ time.’2 Eight days before that, Churchill had given parliament a more robust vision of the future, promising that when the Germans came the British would fight on the beaches, and would never surrender. There is another part of this speech that is less known today but in some ways more telling. If the country was overrun, Churchill had also said, the British government ‘would carry on the struggle, until, in God’s good time, the New World, with all its power and might, steps forth to the rescue and the liberation of the Old’.3 There was no longer any pretence. Britain’s campaign to woo the United States was under way.
The Britannic pulled sleepily away from the Liverpool docks, while elsewhere around the country sandbags continued to be piled up in tidy formations, concrete was set on pillboxes, troops were drilled, often without weapons, and in Whitehall enervated civil servants finalized plans to move the machinery of government overseas when, or if, the Germans took London. Others oversaw the ongoing transfer of Britain’s gold reserves to North America, including the king’s ransom now hidden in the hold of the Britannic.
Up on deck, passengers watched the British coastline stretch out before them and shrink, until it was swallowed up by the sea and sky. Their minds would have been aswirl as they thought about the friends and family they were leaving behind, and the dangers of the crossing ahead. Since the start of the war the Allies had lost over a million tons of shipping to marauding German submarines in the Atlantic, and in recent weeks those losses had begun to rise.
The Britannic joined a convoy and began to sail west. After three days at sea, orderlies pinned the latest news bulletin to the ship’s noticeboards. Crowds of passengers gathered round to find out what was happening in Europe. The news was bleak. That morning, the bulletin revealed, German forces had entered the suburbs of Paris.
France had fallen. Now Britain stood alone.
As German troops celebrated that night in the French capital, the Britannic, with its peculiar cargo of spies, diplomats, royalty, children and gold, was separated from its protective convoy for the first time since leaving Liverpool. Initially planes were dispatched from Canada to provide aerial cover, until, as reported in the New York Times, the ‘fog became so thick that an airplane escort was unable to locate the vessel from the air’.4 This elegant, ageing liner was on its own. The same was true of Britain. Salvation for both lay in the New World.
Those on board the Britannic had become familiar by then with the reassuring drone of planes overhead and the sight of the other ships in the convoy. The emptiness around them must have been eerie. A U-boat could strike at any time, and there was nothing they could do about it.
One of the passengers bracing himself for the shudder of a torpedo striking the hull was a forty-three-year-old called Bill Stephenson. Had you met him on board the Britannic you might have guessed he was a businessman. From the way he dressed and the cost of his cabin, you would have surmised he was fairly well-off. There is also a good chance you would have enjoyed talking to him. One man who had many reasons to bear a grudge against him later admitted, ‘it was impossible not to like Bill Stephenson.’5
To look at, Stephenson was unimpressive. ‘Very small in stature,’ recalled one secretary, ‘neatly put together’ and ‘a very still person’.6 But unlike most short men ‘he never struck his head up to look at you,’ the author Roald Dahl remembered. ‘He kept his chin right in and only his eyes, which were very pale, his eyes looked up at you and he never raised his voice, ever.’7 Many remarked on this quiet intensity, this compression, and the sense that he seemed to be forever holding himself in. ‘He always listened with total concentration to what I had to say,’ recalled one employee, ‘a sympathetic grin flickering at the corner of his mouth.’8 In Stephenson it was as if a figure of restless energy had been wedged into the shell of a more watchful man.
It is unlikely that any of the people who met him on board the Britannic would have guessed either that he was a spy, or that he was on his way to meet the greatest challenge of his life, one that would catapult him into a world he knew worryingly little about. Stephenson had spent most of his adult life as a businessman. He was at his confident best in the world of investment: sizing up a new commercial venture, negotiating an improved stock option, securing collateral for a series of loans. In a matter of days he would start a new career as a professional intelligence officer.
Only a few days before boarding the Britannic, Bill Stephenson had formally joined Britain’s foreign intelligence agency, MI6, and been appointed Head of Station for the United States, a country codenamed ‘48-LAND’ in MI6 after its then forty-eight states. The stakes could not be higher. If he got it wrong, he might damage his country’s chances of avoiding defeat. But if he got it right, consistently, he would play a part in its victory.
The Britannic swept out of the fog unscathed. Several days later, on 21 June 1940, the ship docked alongside Pier 54 in the heart of Manhattan’s meatpacking district. It was a cool day, yet bright. The city’s skyline was doused in a lemony light as the first passengers descended the gangplanks.
At almost exactly the same time, three thousand miles away in France, Adolf Hitler climbed into a railway carriage just outside Paris, where he laid down the terms of the armistice with France. This was the same carriage, and the same location, in which a German delegation had signed the 1918 armistice. Soon German radio stations declared a ten-day celebration of the Nazi victory, an announcement that finished with a promise of what was to come: ‘we will sail against England’ with an invading force ‘like nothing the world has ever seen’.9
The crowd which had gathered to meet the Britannic was small and subdued. On the lower level of Pier 54, hidden from sight, hundreds of crates of gold were loaded onto armoured trucks and driven to the Federal Reserve Bank of New York. Overhead, passengers left the ship in a similar fashion: quietly and without revealing more than they needed to about why they were there or where they were going.
Bill Stephenson disembarked like the others, and at the end of the pier he was met by a driver. His luggage was loaded up, and he disappeared into the large-lettered commotion of New York, a city where people go to reinvent themselves. This is exactly what he had to do.
Among the many wartime additions to MI6, Bill Stephenson was unusual. His new colleagues tended to be well-off former naval officers who had enjoyed expensive childhoods, and might have been seen in the years before the war wearing ‘spats and monocles long after they passed out of fashion’.1
Stephenson’s upbringing was rather different. He had grown up in poverty in what was effectively the red-light district of a remote Canadian town, Winnipeg, in the Canadian prairies. He was four when his father died. At the age of fourteen he left school and found work in a lumber yard. His mother was an Icelandic immigrant, one of thousands who had left Iceland in the late nineteenth century in the wake of a volcanic eruption to start a new life in the heart of Canada. Stephenson grew up in a working-class Icelandic community rooted to the poorest part of town, Point Douglas, an area notorious for its frequent outbreaks of smallpox and typhoid. It was also the only district in which the city authorities tolerated prostitution. Growing up, the view from his house would have been similar, as a local historian has put it, ‘to having a seat at an outdoor peep show’.2 Stephenson’s formative years were among men and women who rarely strayed beyond their neighbourhood, married within the community and dreamed of one day moving to a house within shouting distance of where they had been born. These were his people. This was his world. It was cloistered, dangerous and tough. He was surrounded by fellow ‘goolies’, local slang for Icelandic-Canadian, as well as bawdy houses, prostitutes and drunks. He grew up understanding the value of loyalty and the language of violence.
But almost as soon as he left Canada in his early twenties, it was as if none of this had ever happened. Years later, he reminisced pleasantly about a childhood spent ‘on the prairies of western Canada’, and how his ‘family had pioneer blood that went back for generations’.3 On his marriage certificate, Stephenson described his father as a man of ‘independent means’, and elsewhere as a wealthy businessman and heroic British soldier who had founded the nearby lumber mill and been killed in the Boer War.4
Most of this was untrue. Stephenson’s father never served with the British Army, and rather than running the local mill he had merely worked there as a labourer for a few years. Each of us can become clumsy when reaching into our past, but this was no slip. In the months before the release of the biography containing most of these exaggerations, Stephenson tried to block the book’s publication in just one country – Iceland – where, of course, there were people who knew the truth about his background.
Why did Bill Stephenson run away from his past? The wall he built around his upbringing had less to do with vanity or pride than a desire on his part to cover up the secret at the heart of his childhood, which was only revealed many years after his death, as we shall see.
War was Stephenson’s way out of Winnipeg. Aged twenty, he joined the Canadian Expeditionary Force and in 1917 was sent over to France. On the Western Front he was gassed and wounded, and after a long convalescence in Britain he secured a transfer to the Royal Flying Corps. In the months that followed he underwent a metamorphosis. This hitherto quiet and apparently shy young man became an intrepid and fearless flying ace. In the cockpit of a Sopwith Camel he was transformed, and by the end of the war had notched up an impressive fourteen ‘kills’ and been awarded the Military Cross, the Croix de Guerre and the Distinguished Flying Cross for his ‘conspicuous gallantry’ and for showing ‘the greatest courage and energy in engaging every kind of target’.5 He was also commissioned as an officer, and at the same time his relationship with Britain was galvanized. Still a proud Canadian, Stephenson had come to see himself also as a loyal Briton. He had fought for King and Country, and for the rest of his life, wherever he lived, he would insist on having a portrait of the reigning monarch hung over the fireplace.
Captain W. S. Stephenson, MC, DFC, as he now was, returned to Winnipeg as a war hero. At once he set about becoming an entrepreneur, launching a company which sold a new type of can-opener that he claimed to have invented himself (but had not). Soon he was selling other household goods and was earning enough to move out of the red-light district. Captain Stephenson was riding high, until his business fell apart in 1922 and he was declared bankrupt.
Stephenson left Winnipeg in a hurry and moved to London, where he reinvented himself and his past, married an American heiress, joined the General Radio Company and by the end of the decade had made a fortune developing, marketing and selling radio sets. By the mid-1930s, Bill Stephenson was a respectable Canadian millionaire with his own investment fund, but one who preferred not to speak about his past.
It was around this time that my grandparents came to know him. Harold and Alice Hemming were also Canadians who had moved to London. Although Harold came to Britain when he was much younger, Alice had spent most of her life until then in Canada and perhaps had more in common with Stephenson than her husband. Although she was more gregarious and outspoken than Stephenson, they were similar in age and both had been living in poverty in different parts of Winnipeg at the start of the war. Alice and her family later moved to Vancouver, where she became a journalist at the Vancouver Sun. But like Stephenson she never forgot the privations of her childhood.
By 1936, the Hemmings and their two children were regular guests at Stephenson’s tiny weekend cottage in Buckinghamshire, just outside London. Harold and Alice’s diaries give a fleeting taste of the atmosphere there. In winter they would all go foraging for mushrooms, in summer they played with the children in the woods or among the wildflowers. Alice is often sleeping in the sun, or chatting to Bill’s wife, Mary. Harold, a banker, is playing around with his new toy, a ‘movie camera’, or he is talking shop with Bill – the two of them worked together on several business deals including the financing of the Earls Court Exhibition Centre. On one visit, they all went to a nearby waterfall and Bill got soaked and spent the afternoon wandering around in his wife’s pink trousers.6 The mood was relaxed and informal, but occasionally glamorous. At lunch Harold and Alice might find themselves sitting next to wealthy Americans, Canadian writers, English grandees, or the former heavyweight boxing champion of the world Gene Tunney. At one meal, Alice got on so well with the pilot next to her that when it was time to go home she and Harold agreed to have a race. He would drive, Alice and the pilot would fly, which they did, flying to Hendon Aerodrome in north London, where Alice caught a taxi home (and won).
But by the time Stephenson pulled my three-year-old Dad out of his pond, as he did in September 1938, just days before the Munich Crisis, Harold and Alice’s visits to the cottage were less frequent and the atmosphere appears to have changed. What my grandparents did not mention in their diaries – because they would not have known – is that by this point in Stephenson’s life he was gravitating towards the world of intelligence.
Most of Stephenson’s wealth was then tied up in his investment fund, British Pacific Trust, which owned stakes in companies operating across northern Europe. They produced everything from cement and aeroplanes to film sets. As Stephenson’s business portfolio expanded, so did his need for better information about the territories in which he had investments. To give him an edge, he came to rely on a loose network of friends, acquaintances and paid informants to tell him about the economic situation in countries such as Sweden and Germany. One of these may have been Harold, whose work for an American stock brokerage frequently took him to Berlin, and who would, according to his diary, always see Stephenson after each of these trips.
Around this time, Stephenson took the unusual step of giving this network a name. He began to refer to it as ‘The British Industrial Secret Service’. Given that this operation was small, private, unofficial, and had nothing to do with the British government, it is hard to think of a more peculiar or provocative title.7 Calling it this made no sense, unless, of course, Stephenson had some deeper desire to be involved in the world of espionage and wanted to pique the curiosity of Britain’s actual secret intelligence service.
- On Sale
- May 17, 2022
- Page Count
- 400 pages