The Wealth Of Presidents

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Coolidge’s success can be ascribed in part to the fact that he was the first President allowed by law to defray the expenses of his official entertainment. Of course, his well-known parsimony was no handicap. Colonel Edmund Starling, a Secret Service agent, recounts in his memoirs a discussion he had with Coolidge in the President’s dressing room. Coolidge opened the conversation:

“I gave somebody a dime one afternoon to buy a Collier’s and I didn’t get my nickel back,” he said.

“It wasn’t I,” I said.

“I don’t know who it was,” he said, “but somebody owes me a nickel.”

“I don’t owe you a nickel,” I said.

“I didn’t say you did,” he said, “I don’t know who he was, but he didn’t give me back my nickel.”

Latterly, even such heroic attentiveness to detail has not been helpful. The Presidency has become frightfully expensive. Franklin Roosevelt, a man of independent means, found not only that he could not save anything from his salary but that it cost him $175,000 annually out of his own pocket to stay in the White House.

Upon those few Chief Executives who have arrived at the Presidency not well provided for, the burden has weighed even more heavily. Harry Truman was one of these. He came to the White House with a history of financial disasters behind him. Just before World War I he had borrowed against a future inheritance in order to invest in zinc mines and oil fields in the West. They came to naught. Then came his celebrated partnership in the haberdashery business with his former army buddy, Sergeant Eddie Jacobson. After a booming first year, deflation broke their firm. Truman lost his original investment of $15,000 and another $15,000 he had thrown in, trying to salvage the failing enterprise. As late as 1934, when he was a United States senator, he still had a debt of $9,000, having refused to accept bankruptcy.

As one of the less affluent senators, Truman always had a loan going at a Washington bank, and he unashamedly put his wife on his payroll at $4,500 per year. He stropped razor blades on the palm of his hand, he said, to coax extra shaves from them. It saddened him that he was unable to help his mother when, in 1940, she lost her home through foreclosure.

Truman’s vice-presidential salary made him consistently solvent for the first time in many years. He was able to buy a fourteen-room house in Independence. Becoming President, however, did not immediately make him any richer. He found himself spending $72,000 of the $75,000 presidential salary. Once again Truman had to be mindful of his expenditures. Only after the President’s salary was raised to $100,000 in 1949 and the expense allowance raised from $40,000 to $90,000 was he able to save any money.

By a coincidence Truman was followed in office by another man who, until the eve of the Presidency, had been frustrated in trying to eke out his resources. General Eisenhower, however, had had the good fortune to move from a financially straitened profession to civilian life at a time when affluence was becoming widespread—even embracing old soldiers.

Eisenhower seems not to have been able to accumulate any nest egg until he served in the Philippines in the 1920’s. By 1940 he had saved enough to obtain title to a mortgaged brick house in the suburbs of Washington, D.C. When he came to Columbia University in 1948 he had only a few thousand dollars in the bank—which he spent on a new automobile.

It was his war memoirs that made Eisenhower a rich man. He received about !635,000 for his Crusade in Europe . A favorable tax ruling on this windfall enabled him to treat it not as income but as a capital gain. For the first time in his life he had funds for investment.

In general, the lawyers among the Presidents have come to the White House better equipped financially than any other group. Lincoln’s success has already been commented on. Benjamin Harrison’s income as a lawyer in Indiana in the 1870’s was $10,000, an impressive sum. Grover Cleveland, too, had done well. By 1881 he had saved about $75,000. He had a keen eye for good stock investments. (One which was especially profitable was in the Royal Victoria Hotel in Nassau.) As a leader of the bar of Buffalo, New York, and the possessor of a frugal nature, he made a modest fortune.

Cleveland seems to have been fascinated by the money-making opportunities that he found turning in his direction. He purchased his lovely Oak View estate outside Washington, B.C., for $21,500 and spent additional sums on its improvement. After only a few years he sold it for $140,000—realizing a profit of nearly $100,000 on the transaction. About the time he left the Presidency in 1897 a friend estimated his wealth to be about a third of a million dollars.