Fred Korth was born in Yorketown, Texas, in 1909. His older brother, Romeo Korth was instrumental in implementing rural electrification for South and Central Texas.
During the Second World War he served in the Air Transport Command. By 1945 he had reached the rank of lieutenant-colonel. After the war he worked as a lawyer in Forth Worth, Texas. He joined the Democratic Party and worked with John Connally in helping Lyndon B. Johnson in his 1948 election campaign.
In 1952 Harry S. Truman appointed Korth as Assistant Secretary of the Army. He worked under Frank Pace. Both men left office in 1953. Pace became chief executive of the General Dynamics Corporation in Texas. Korth returned to his law practice. He also became director of the Bell Aerospace Corporation. The chairman of the company, Lawrence Bell, was a fellow member of the Suite 8F Group. Korth also became president of the Continental National Bank of Fort Worth. This was one of General Dynamics bankers.
In the last few months of the administration of Dwight Eisenhower, the Air Force began to argue that it needed a successor to its F-105 tactical fighter. This became known as the TFX/F-111 project. In January, 1961, McNamara, changed the TFX from an Air Force program to a joint Air Force-Navy under-taking. On 1st October, the two services sent the aircraft industry the request for proposals on the TFX and the accompanying work statement, with instructions to submit the bids by 1st December, 1961. Three of the bids were submitted by individual companies: the Lockheed Aircraft Corporation, the North American Aviation Corporation and the Boeing Company. The other three bids represented team efforts: Republic Aviation & Chance Vought; General Dynamics Corporation & Grumman Aircraft; and McDonnell Aircraft & Douglas Aircraft.
It soon became clear that Boeing was expected to get the contract. Its main competitor was the General Dynamics/Grumman bid. General Dynamics had been America’s leading military contractors during the early stages of the Cold War. For example, in 1958 it obtained $2,239,000,000 worth of government business. This was a higher figure than those obtained by its competitors, such as Lockheed, Boeing, McDonnell and North American. More than 80 percent of the firm’s business came from the government. However, the company lost $27 million in 1960 and $143 million in 1961. According to an article by Richard Austin Smith in Fortune Magazine, General Dynamics was close to bankruptcy. Smith claimed that “unless it gets the contract for the joint Navy-Air Force fighter (TFX)… the company was down the road to receivership”.
General Dynamics had several factors in its favour. The president of the company was Frank Pace, the Secretary of the Army (April, 1950-January, 1953). The Deputy Secretary of Defense in 1962 was Roswell Gilpatric, who before he took up the post, was chief counsel for General Dynamics. The Secretary of the Navy was John Connally, a politician from Texas, the state where General Dynamics had its main plant.
Connally left the job in January 1962 and John F. Kennedy now appointed Korth as Secretary of the Navy. According to author Seth Kantor, Korth only got the job after strong lobbying from Lyndon B. Johnson. A few weeks after taking the post, Korth overruled top Navy officers who had proposed that the X-22 contract be given to Douglas Aircraft Corporation. Instead he insisted the contract be granted to the more expensive bid of the Bell Corporation. This was a subsidiary of Bell Aerospace Corporation of Forth Worth, Texas. This created some controversy as Korth was a former director of the company.
Korth also became very involved in discussions about the TFX contract. Korth, was the former president of the Continental Bank, which had loaned General Dynamics considerable sums of money during the late 1950s and early 1960s. Korth later told the John McClellan committee that investigated the granting of the TFX contract to General Dynamics “that because of his peculiar position he had deliberately refrained from taking a directing hand in this decision (within the Navy) until the last possible moment.”
As I. F. Stone pointed out, it was “the last possible moment” which counted. “Three times the Pentagon’s Source Selection Board found that Boeing’s bid was better and cheaper than that of General Dynamics and three times the bids were sent back for fresh submissions by the two bidders and fresh reviews. On the fourth round, the military still held that Boeing was better but found at last that the General Dynamics bid was also acceptable.” Stone goes on to argue: “The only document the McClellan committee investigators were able to find in the Pentagon in favour of that award, according to their testimony, was a five-page memorandum signed by McNamara, Korth, and Eugene Zuckert, then Secretary of the Air Force.”
Robert McNamara justified his support for General Dynamics because “Boeing had from the very beginning consistently chosen more technically risky tradeoffs in an effort to achieve operational features which exceeded the required performance characteristics.”
The TFX program involved the building of 1,700 planes for the Navy and the Air Force. The contract was estimated to be worth over $6.5 billion, making it the largest contract for military planes in the nation’s history.
On 24th October, 1962, Seth Kantor reported in the Fort Worth Press that: “General Dynamics of Fort Worth will get the multibillion-dollar defence contract to build the supersonic TFX Air Force and Navy fighter plane, the Fort Worth Press learned today from top Government sources.”
This was confirmed the following month when the Pentagon announced that the TFX contract would be awarded to General Dynamics. Henry M. Jackson was a member of the Senate Armed Services Committee, the Senate Government Operations Committee and the Permanent Subcommittee on Investigations. He learned that: “Boeing’s bid was substantially lower than its competitor’s. Reports indicated Boeing’s bid was $100 million lower on an initial development contract and that the cost difference might run as high as $400 million on the total $6.5 billion procurement.”
On 12th December, Lyndon B. Johnson visited Forth Worth to join in the festivities at the General Dynamics plant. Congressman James Wright, the Texas Democrat representing the Fort Worth district introduced Johnson as the “greatest Texan of them all”. He pointed out that Johnson had played an important role in obtaining the TFX contract. Wright added “you have to have friends and they have to stick with you through thick and thin even if you do have merit on your side.”
During the McClellan's Permanent Investigations Committee hearings into the contract, Senator Sam Ervin asked Robert McNamara “whether or not there was any connection whatever between your selection of General Dynamics, and the fact that the Vice President of the United States happens to be a resident of the state in which that company has one of its principal, if not its principal office.” At this point McNamara was close to tears and commented that: “Last night when I got home at midnight, after preparing for today’s hearing, my wife told me that my own 12-year-old son had asked how long it would take for his father to prove his honesty.”
McNamara rejected the idea that Lyndon B. Johnson was involved in the decision but evidence was to emerge that he did play an important role in the awarding of the TFX project to General Dynamics. For example, William Proxmire found some interesting information on the TFX project while investigating the role played by Richard Russell in the granting of the C-5A contract to Lockheed. The C-5A was built in Marietta, Georgia, the state that Russell represented. The Air Force Contract Selection Board originally selected Boeing that was located in the states of Washington and Kansas. However, Proxmire claimed that Russell was able to persuade the board to change its mind and give the C-5A contract to Lockhead.
Proxmire quotes Howard Atherton, the mayor of Marietta, as saying that “Russell was key to landing the contract”. Atherton added that Russell believed that Robert McNamara was going ahead with the C-5A in order to “give the plane to Boeing because Boeing got left out on the TFX fighter.” According to Atherton, Russell got the contract after talking to Lyndon Johnson. Atherton added, “without Russell, we wouldn’t have gotten the contract”.
On 26th June, 1963, Clark R. Mollenhoff managed to interview Robert McNamara about his role in awarding the TFX contract to General Dynamics. McNamara claimed that Johnson had applied to political pressure on him concerning the contract. He admitted that he knew all about Fred Korth’s business relationship with General Dynamics and Bell Aerospace. He also revealed he was aware of Roswell Gilpatric’s role “as a lawyer for General Dynamics just prior to coming into government, the role of Gilpatric’s law firm in continuing to represent General Dynamics, and the amount of money Gilpatric had received from the law firm since becoming Deputy Defense Secretary”. However, he was convinced that this did not influence the decision made by Fred Korth and Roswell Gilpatric.
John McClellan, chairman of the Permanent Investigations Committee, continued looking into the activities of Billie Sol Estes and Bobby Baker. During this investigation evidence emerged that Lyndon B. Johnson was also involved in political corruption. This included the award of a $7 billion contract for a fighter plane, the TFX, to General Dynamics, a company based in Texas. When it was discovered that the Continental National Bank of Fort Worth, was the principal money source for the General Dynamics plant. As a result of this revelation Korth resigned from office in October, 1963.
On 22nd November, 1963, a friend of Baker's, Don B. Reynolds told B. Everett Jordan and his Senate Rules Committee that he saw a suitcase full of money which Baker described as a "$100,000 payoff to Johnson for his role in securing the Fort Worth TFX contract".
John McClellan, the chairman of the Senate subcommittee investigating the TFX contract said that he wanted to interview Don B. Reynolds. However, for some reason the subcommittee did not resume its investigation until 1969, after Johnson had left office.
After resigning as Secretary of the Navy, Korth worked as a lawyer in Washington. In 1969 he was elected to the board of OKC Corporation in Dallas. Later that year Fred Korth's daughter Verita Korth, supposedly killed herself with a 20 gauge shotgun.
According to President Kennedy's secretary, Evelyn Lincoln, Bobby Kennedy was also investigating Bobby Baker for tax evasion and fraud. This had reached the point where the President himself discussed the Baker investigation with his secretary, and allegedly told her that his running mate in 1964 would not be Lyndon Johnson. The date of this discussion was November 19, 1963, the day before the President left for Texas.
A Senate Rules Committee investigation into the Bobby Baker scandal was indeed moving rapidly to implicate Lyndon Johnson, and on a matter concerning a concurrent scandal and investigation. This was the award of a $7-billion contract for a fighter plane, the TFX, to a General Dynamics plant in Fort Worth. Navy Secretary Fred Korth, a former bank president and a Johnson man, had been forced to resign in October 1963, after reporters discovered that his bank, the Continental National Bank of Fort Worth, was the principal money source for the General Dynamics plant.
Fred Korth was one of those great public servants, at one of those critical junctures in our history. He was called by President Kennedy at a time when his service would mean great sacrifice for his family and he responded positively at a time when the Navy would be tested at the peak of the Cold War. His calm demeanor and his relentless drive to always do the right thing earned him controversy and tested his character. Fred passed the test, and those of us who were fortunate to know him are not surprised.
The impact of Fred Korths character in high public office could not have come at a better time His was a Navy that shaped the positive outcome of the Cuban Missile Crisis; a Navy that broke revolutionary ground for a nuclear-powered surface and submarine fleet that was building from the keel up; and a Navy whose Sailors, Marines and civilians gained immensely from his care for their well-being. It is, today, a Navy-Marine Corps Team that still benefits from his legacy of total devotion to his Service and its people.
One Sunday evening I was consulting with Abe Fortas at his home when Lady Bird Johnson called... I hardly heard her. I was thinking: LBJ's right there by her side, but he won't talk to me because he wants to be able to say he hasn't. I knew that Johnson was petrified that he would be dragged down... LBJ was already nervous because of the Billie Sol Estes scandal and the resignation of a Texas friend, Fred Korth, who'd quit as secretary of the navy following conflict-of-interest accusations. So I'd not expected to hear much from him. In fact, from the moment I resigned in October of 1963 until I visited him at his ranch to see a dying man, almost nine years later, we spoke not a word and communicated only through intermediaries.
I have an interesting story about Korth, whowas from Texas. His first wifetold mehe was a delight until the fall of 1963 when Korth became silent and sullen, troubled by something. He moved out of their house in early Nov. 1963 and would not speak to her again. She was convinced that therewas not another woman involved. What did Korth know that made him leave his wife? Was this to protect her?