Lowenthal, Max, 1888-1971

Max Lowenthal, B.A. (1909) University of Minnesota, J.D. (1912) Harvard Law School; attorney and lifelong public servant. A close associate of Felix Frankfurter, Harry Truman and Louis Brandeis, he served on the National Committee on Law Observance and Enforcement (the Wickersham Commission), the Senate Committee on Banking, Housing and Urban Affairs, and the Interstate Commerce Commission. Lowenthal was an advisor and personal friend of President Harry S. Truman, and was influential in President Truman's recognition of the State of Israel. His publications include The Investor Pays (1933), and The Federal Bureau of Investigation, (1950), an expose of the Bureau and its operations, detailing a history of political spying, red-baiting and harassment of foreigners and radicals.

Max Lowenthal was born 26 February 1888 in Minneapolis, Minnesota. His parents, Nathan (Naphtali) Lowenthal and Gertrude (Nahamah Gitel) Lowenthal immigrated from Kovno, Lithuania to Minnesota in the 1870s. Max Lowenthal was the youngest of three sons. The eldest died in Lithuania and a second son, Archie (Yecheskel) was born in 1887 in Minneapolis. Max Lowenthal’s given name was Mordechai - like his brother Archie, his name was Americanized in elementary school, and he was referred to as Max thereafter. Nathan and Gertie Lowenthal were active members of North Minneapolis’s Orthodox Jewish community. As a founder and trustee of the North Side’s first synagogue, Kenesseth Israel, Nathan Lowenthal figured large in community life, owning and running a modestly successful home furnishings store, acting as a go-between for the community and downtown politicians and police, and serving occasionally as a Democratic precinct chair. Gertie Lowenthal ran the family business and was a devoted synagogue member. Max Lowenthal attended Minneapolis Public schools where he excelled at Latin and literature, and graduated first in his class from North High School in 1905. He also attended the Talmud Torah, where he learned Hebrew.

He attended the University of Minnesota, graduating in 1909. That same year he was accepted into Harvard Law School. During his three years at Harvard, Lowenthal formed what became a lifelong friendship and working relationship with Felix Frankfurter.

Upon graduation from Harvard in 1912, Lowenthal clerked for Judge Julian W. Mack, a noted jurist, social progressive and Zionist. In 1914, he worked as a law clerk for the New York firm of Strong & Cadwalender. Lowenthal established his own successful law practice in 1915, which he subsequently left after three years when asked by Felix Frankfurter to travel to Spain in July 1917 as part of the confidential Morgenthau Mission. Upon returning, Lowenthal traveled with Frankfurter to the American west and southwest, serving on President Wilson’s Mediation Committee settling war-time management–labor disputes. Lowenthal also served as Frankfurter’s assistant in 1918 when Frankfurter chaired the War Labor Policies Board, which formulated uniform wartime labor policies, advocated for war industry workers, and studied domestic and foreign wartime labor conditions.

From 1919 to the fall of 1920, Lowenthal returned to private practice in New York. During that time, again on a recommendation from Felix Frankfurter, Lowenthal oversaw the successful defense of Sidney Hillman and the Amalgamated Clothing Workers Union in a landmark labor injunction suit. Lowenthal intention was to return to Columbia University to study philosophy and geology or astronomy. He joined the Szold Brandwen law firm, assuming it would be a six month association, but remained with the firm for nine years, handling a variety of cases involving the film, aviation, manufacturing and retail industries, and simultaneously writing a study on receiverships that would be published in 1933 as The Investor Pays . He also worked on the founding of the Amalgamated Bank, the first labor-union supported bank to service smaller borrowers by offering unsecured loans to immigrant and working peoples.

In 1922, Max Lowenthal married Eleanor Mack, a niece of Judge Julius Mack. The first of three children, David, was born in 1923, followed by John in 1925 and Elizabeth (Betty) in 1927. The family moved from New York to Washington, D.C. in 1929. From 1929 to 1930, Lowenthal served as Executive Secretary to the National Committee on Law Observance and Enforcement, known as the Wickersham Commission. The Commission had been created by President Herbert Hoover to investigate the causes of rising crime rates in the United States, and to determine if and how increased crime was related to Prohibition. Lowenthal resigned from the Commission in the summer of 1930. After his resignation, Lowenthal returned to working on his receivership manuscript and the Lowenthal Szold & Brandwen law practice. His time away from public service was, however, short-lived. In 1933, again at Felix Frankfurter’s recommendation, Lowenthal was appointed as Research Director to Ferdinand Pecora’s Senate Committee on Banking, Housing and Urban Affairs. The committee, created in 1932, was charged with investigating the underlying causes of the 1929 stock market crash. The Pecora Commission uncovered a wide range of abusive practices on the part of banks and bank affiliates. The hearings galvanized broad public support for new securities laws. As a result of the Pecora Commission's findings, Congress passed the Securities Act of 1933 and the Securities Exchange Act of 1934, requiring financial disclosures from companies seeking public financing. The Securities Exchange Commission was created to carry out the reforms. Lowenthal was asked by Commission Chair Senator Duncan Fletcher to draft the original stock exchange regulations bill.

In 1935, Lowenthal became Chief Counsel for the Interstate Commerce Commission (ICC), chaired by progressive Senator Burton Wheeler. During that same year, Lowenthal was at the hub of legal activities initiated by a group of activist Missouri Pacific (MoPac) bondholders, led by Charles Beard. Lowenthal continued to advise the Banking Committee during the Railroad Financial Reorganizations investigation in 1936, playing a key advisory role in ongoing legislation through 1942.

In his first year at the ICC, Lowenthal met Harry Truman, the newly elected junior senator from Missouri. Truman was appointed to the ICC in 1935, and became the vice chair of the Committee to Investigate Railroad Finances in 1937. During their shared years on the committee, Truman and Lowenthal cemented a political and personal relationship that was to last until Truman’s death in 1968. Lowenthal introduced Truman to Justice Louis Brandeis, a connection that proved to be a turning point for point for the senator, who found that he shared with Brandeis and Lowenthal “…agreement on the dangers of bigness.” In 1939, the Wheeler-Truman Bill was introduced in Congress. The bill sought to regulate all segments of the transportation industry, with a continued special emphasis on railroads. Lowenthal’s experience documenting and analyzing railroad finances, mergers and receiverships and advising the MoPac bondholders lead Truman to rely on his expertise, both legally and strategically. The bill passed congressional scrutiny and became the Transportation Act of 1940.

Lowenthal left the ICC in 1941. From February to July of 1942, he was the Chief Consultant to the General Council of the Board of Economic Warfare (BEW). For the remainder of 1942 until January of 1944, he served as head of the Re-Occupation Division of the BEW. The BEW had been commissioned by President Franklin D. Roosevelt during the prewar years and was responsible for the procurement and production of all imported materials necessary both to the war effort and the civilian economy. The Bureau, renamed the Office of War Management in 1943, was set up to streamlined purchasing for the war effort. Political struggles between BEW head Vice President Henry Wallace and the State Department led to the dissolution of the Office of War Management in late 1943. In January of 1944, Lowenthal left BEW.

In 1945, a bi-partisan sub-committee of the Senate Inter-State Commerce Commission asked Lowenthal to serve as a special advisor on railroad reorganization questions and legislation. He continued to consult with members of the ICC and the House Judiciary committee for another two years.

In August 1946, Lowenthal was asked to perform a different type of governmental service. General Lucius D. Clay, the Deputy Governor of Germany in the Allied Military Government had asked representatives of American Jewish organizations to recommend counsel to assist him in drafting legislation on the return of property seized by the Nazis. Lowenthal was selected for the job, and spent six weeks in the fall of 1946 touring parts of Germany taking testimony and drafting his report. While in Germany he toured several displaced persons camps, recording what he saw there in diaries and letters home.

Upon his return, Lowenthal continued to advise the Truman Administration informally. During the spring of 1948, the administration was embroiled in an internal struggle focused on Palestine. The pro-Arab U.S. State Department backed a plan that maintained Palestine as a trustee state of the United Nations past a deadline that had been set for the creation of the state of Israel. Close advisors to Truman, including Lowenthal, Clark Clifford and David Niles, backed implementation of a U.N. mandated recognition of the new nation in May of 1948. Ultimately, the White House advisors prevailed over the State Department. Letters between Truman and Lowenthal reveal that the President saw Lowenthal’s arguments - in the form of memos used in briefings - as critical in influencing his actions. In a series of letters written during the early 1960s Truman stated that Lowenthal is the “…one who should have the credit” [23 April 1962] and “…I [Truman] don’t think it’s proper for me to take the program as mine when you set it up” [3 April 1962]. Lowenthal continued to advise the Administration through the end of Truman’s second term in 1952. Lowenthal was a delegate to both the 1952 and 1956 Democratic Conventions.

In addition to serving in all three branches of government, Lowenthal was a dogged and probing investigative writer and researcher. His interest in writing took shape during his university years, where he reported on university events for the Minneapolis Journal . His first book, The Investor Pays, is based on cases from his law practice. Between his first and second books, Lowenthal published opinion pieces on banking, rail and insurance industries and financial reform in The New Republic, The Nation, and Harpers’ . His second book, The Federal Bureau of Investigation, was released in 1950. It was the first substantively documented book critical of the Bureau and its operations, detailing a history of political spying, red-baiting and harassment of foreigners and radicals. The book’s publication was preceded by a denouncement of Lowenthal as a communist sympathizer on the House floor. A barrage of criticism of Lowenthal and The FBI appeared in syndicated columns. Shortly before the book was released, Lowenthal was subpoenaed by the House Un-American Activities Committee where he was grilled about his relationships with a number of liberals and communists. The Federal Bureau of Investigation was not promoted by its publisher, and sold poorly. A final Lowenthal manuscript on the history of American sedition laws was never published.

After withdrawing from active public service in the late 1950s, Max Lowenthal remained involved in a variety of political and philanthropic causes, most notably underwriting educational scholarships for Israeli and Palestinian high school students, law school scholarships at Harvard Law school, and research into increasing arable land in the Sinai to reduce regional hunger. He was also an avid horticulturalist. Max Lowenthal died of heart failure in New York City on 19 May 1971.