Kennedy, Joseph P.

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KENNEDY, JOSEPH P.

Joseph Patrick Kennedy (September 6, 1888–November 19, 1969) amassed enormous personal wealth as a businessman and became both the first chairman of the Securities and Exchange Commission (SEC) and the first Irish-American Catholic to be U.S. ambassador to Great Britain.

Kennedy was born in Boston, Massachusetts, into an Irish-American family active in the local Democratic Party. After an education at Boston Latin School and Harvard University, he began a successful business career. In 1914, at age twenty-five, he became the country's youngest bank president, heading the Columbia Trust Company. After a brief period in shipbuilding during World War I, he joined Hayden, Stone and Company, where he developed expertise in stock dealing. In 1922, he began to speculate in the stock market full-time, quickly proving himself an exceptional corporate predator and a skilled manipulator of Wall Street. Kennedy portrayed himself as both talented and lucky, but questionable ethics assisted his progress. The Bostonian mastered the use of inside information, participated in stock pools, and often sold short, earning money from falls in stock prices. Kennedy also invested in the film industry, creating the famous Radio-Keith-Orpheum (RKO) corporation. Most accept that Kennedy also gleaned substantial profits from liquor trading during the prohibition years, a process that demanded dealings with organized crime syndicates. By the mid-1920s, Kennedy's fortune was estimated at $2 million. This wealth not only survived the Wall Street crash, as Kennedy sold long-term holdings beforehand, but was enhanced as he sold short to profit from the crisis.

By 1931, Kennedy had entered politics by contributing to Franklin D. Roosevelt's campaign coffers and collecting donations from businessmen who wished to remain anonymous. Arguably, Kennedy also helped Roosevelt secure the 1932 Democratic Party nomination; by scaring his friend, William Randolph Hearst, with tales that internationalist Newton D. Baker might be nominated, Kennedy persuaded the influential Hearst to support Roosevelt.

In 1934, Roosevelt appointed Kennedy to the SEC. The new commission was designed to regulate the worst corporate excesses, but conservatives feared development of an anti-business agency. Kennedy's appointment proved a masterstroke. Portraying the SEC as improving conditions for business, Kennedy bolstered investor confidence, particularly by emphasizing negotiation and self-enforcement over federal coercion. He established an effective administrative system, with excellent staff, and won respect from all quarters. Quickly bored, Kennedy resigned in 1935. Roosevelt, though, retained his ally, appointing Kennedy the first chairman of the Federal Maritime Commission in 1936.

Kennedy assisted the president beyond fundraising and winning business support for New Deal measures. His friendship with Hearst proved useful, and Kennedy also managed to temper the anti-Roosevelt rhetoric of radio demagogue Father Charles Coughlin. Yet, tensions developed between Roosevelt and Kennedy. Kennedy's successes, helped by his penchant for self-publicity, won press attention. Reflecting Kennedy's own ambitions, coverage emphasized Kennedy's presidential potential. When Kennedy resigned from the Maritime Commission in 1937, and pressured Roosevelt to appoint him ambassador to Great Britain, the president obliged. Roosevelt took the opportunity to maneuver a rival out of Washington before the 1940 election.

Kennedy's tenure as ambassador earned him notoriety. In 1938, the threat of Adolf Hitler's Germany loomed large. Kennedy worried that war would jeopardize economic progress. Overlooking the moral issues, he searched for accommodation with the Nazis. Even as appeasement failed, Kennedy made pro-German statements and advocated U.S. neutrality. His claim that Britain lacked the will and weaponry to resist German power upset his hosts. Furthermore, Kennedy's position contrasted with Roosevelt's growing internationalism. The ambassador appeared ready to endorse isolationist Republican Wendell Willkie in the 1940 presidential election. However, on returning to the United States, Kennedy met with Roosevelt. While historians debate the deal agreed to, or blackmail employed, Kennedy endorsed Roosevelt's candidacy two days later.

Shortly after the election, Kennedy blundered. His statement that "democracy is all finished in England . . . it may be here" drew overwhelmingly negative public reaction. Amid the subsequent furor, Kennedy and Roosevelt met again. No record of the ten-minute meeting remains, but it left Roosevelt furious. Kennedy resigned the ambassadorship in early 1941. Loathed for his defeatism and estranged from his former ally, Kennedy never held political office again. Instead, he groomed his sons for political success, seeing his son, John F. Kennedy, become president in 1961.