The Cox Committee and the Reece Committee (1952-55)

The first Congressional Committee to investigate the tax-free foundations was the Cox Committee in 1952, led by Rep. Eugene E. Cox, a Democrat from Georgia. Its purpose was to find out:

"…[which] foundations and organizations are using their resources for purposes other than the purposes for which they were established, and especially to determine which such foundations and organizations are using their resources for un-American and subversive activities or for purposes not in the interest or tradition of the United States ."

Cox discovered that officers and trustees of some foundations were Communists, and that these foundations had given grants to Communists or Communist-controlled organizations. A former Communist official, Maurice Malkin, testified that in 1919 they were trying:

"…to penetrate these organizations (foundations), if necessary take control of them and their treasuries … that they should be able to finance the Communist Party propaganda in the United States ."

During the investigation, Cox died, and the facts were glossed over in a cover-up.

Another member of the Committee, Rep. Carroll Reece of Tennessee, the former Chairman of the Republican National Committee, forced another investigation in 1953, to see if foundations were being used "for political purposes, propaganda, or attempts to influence legislation." Reece even referred to a "conspiracy." The Washington Post called the investigation "unnecessary," and said that it was "stupidly wasteful of public funds."

The Eisenhower Administration was clearly against the probe. Three of the four who were selected for the Committee, with Reece, were House members who had voted against the investigation. Rep. Wayne Hays of Ohio worked from the inside to stall the investigation. During one 3-hour session, he interrupted the same witness 246 times. He prohibited evidence discovered by two of its investigators from being used. Rene A. Wormser, legal counsel to the Committee, revealed why, in his 1958 book Foundations: Their Power and Influence:

"Mr. Hays told us one day that 'the White House' had been in touch with him and asked him if he would cooperate to kill the Committee."

Wormser also revealed that the Committee had discovered that these foundations were using their wealth to attack the basic structure of our Constitution and Judeo-Christian ethics; and that the influence of major foundations had "reached far into government, into the policy-making circles of Congress and into the State Department."

Reece's Special Committee to Investigate Tax Exempt Foundations discovered that many foundations were financing civil rights groups, liberal political groups, political extremist groups, and supporting revolutionary activities throughout the world. The Committee reported:

"Substantial evidence indicates there is more than a mere close working together among some foundations operating in the international field. There is here, as in the general realm of social sciences, a close interlock.

The Carnegie Corporation, the Carnegie Endowment for International Peace, the Rockefeller Foundation and, recently, the Ford Foundation, joined by some others, have commonly cross-financed, to a tune of many millions … organizations concerned with internationalists, among them, the Institute of Pacific Relations, the Foreign Policy Association (which was "virtually a creature of the Carnegie Endowment"), the Council on Foreign Relations, the Royal Institute of International Affairs and others … and that it happened by sheer coincidence stretches credulity."

On August 19, 1954, Reece summed up his investigation:

"It has been said that the foundations are a power second only to that of the Federal Government itself … Perhaps the Congress should now admit that the foundations have become more powerful, in some areas, at least, than the legislative branch of the Government."

The investigation ended in 1955, when funding was withheld.