One of Milwaukee’s movers and shakers was a master spy.
Richard Cutler, the 88-year-old retired partner of the Quarles and Brady law firm, was for years a behind-the-scenes civic heavyweight who played a major role in shaping metropolitan Milwaukee.
In Cutler’s case, that’s not just a civic cliché. It is literally true. In the 1950s, he was a key player in many of the annexation and incorporation battles that carved out the boundaries of Milwaukee and its suburbs, as well as outlying communities in Waukesha and Ozaukee counties.
Cutler later had a direct hand in resolving other regional conflicts, including controversies surrounding the construction of the Milwaukee freeway system and the epic “Sewer Wars” between city and suburbs over the fairest way to pay the enormous cost of cleaning up the area’s waste water.
After the Milwaukee Braves departed for Atlanta in 1965, Cutler was the attorney who assisted his brother-in-law, Edmund B. Fitzgerald, president of Cutler-Hammer (no relation to Richard Cutler), and car dealer Bud Selig in bringing major-league baseball back by transforming the Seattle Pilots into the Milwaukee Brewers.
Cutler fits the classic profile of the blue-blooded, Ivy League-educated elite that quietly controls events in private while petty politicians dance in the public limelight.
Cutler learned the art of covert manipulation from the masters. In the 1940s as a member of an elite counterintelligence unit within the Office of Strategic Services (OSS), the forerunner of the Central Intelligence Agency, Cutler conducted espionage with Allen Dulles, William Casey and Richard Helms, all of whom went on to become directors of the CIA.
In London in 1944, Cutler was one of a small group of intelligence agents who had access to the biggest Allied secret of World War II – that British intelligence had replicated a German “Enigma” machine, which they used for four years to decode Nazi Germany’s top-secret communications.
After the war, Cutler was transferred to Berlin, where, almost immediately, he was plunged into the next major espionage operation that would dominate world politics for two generations – spying and counterspying between the United States and the Soviet Union.
This little-known secret history of a prominent Milwaukee civic leader is revealed in Cutler’s recently published book, Counterspy: Memoirs of a Counterintelligence Officer in World War II and the Cold War (Brassey’s).
It is a real-life story that resonates with shadowy twists that seem familiar to us from the fiction of John le Carré or Ian Fleming, themselves veterans of British intelligence.
The book is an on-the-ground account of the actual details of espionage – from the exhausting, bureaucratic paperwork of “vetting” agents to determine their reliability to bona fide tales of high intrigue.
Cutler worked street level within the hall-of-mirrors world of espionage, capturing Soviet agents and turning them into double agents to spy for the United States and provide misinformation to the Soviets.
Cutler describes driving 100 miles through Germany’s Soviet Zone with a drug-addicted Russian intelligence officer who wanted to defect. Armed with .45-caliber pistols, Cutler and two guards “Americanized” the Russian with a U.S. Army uniform, a crew cut and chewing gum to get him through two Russian checkpoints.
Cutler draws parallels between the imagination and risk-taking involved in intelligence and that required during his long career in business and civic affairs.
Cutler, who still maintains contact with a network of former intelligence officers across the country, also has an insider’s perspective on the intelligence failures of the Bush administration regarding Iraq and the War on Terror.
“Some of the veterans tell me the CIA is broken beyond repair,” says Cutler. “I don’t like to accept that. That would imply by brutal logic that you start all over from scratch. Well, hell, there might be somebody in the CIA, there might even be quite a few who are very good at what they do.”
Cutler’s story helps illustrate the enormous chasm that exists between the intelligence successes of our country’s major conflicts against Nazi Germany and the Soviet Union and our meager effort so far against a borderless terror network that has already brought war to our shores.
U.S. intelligence, at its founding, was a gentleman’s game, attracting some of the best and brightest minds from elite Ivy League universities.
Cutler, whose father was an architect, was born in suburban New Rochelle, New York, and later moved with his family to Westport, Connecticut. After receiving his undergraduate and law degrees from Yale University, he went to work for the Wall Street law firm of Donovan, Leisure, Newton and Lombard.
The founding partner of the firm was Maj. Gen. William “Wild Bill” Donovan, appointed by President Franklin Roosevelt to head the OSS. Cutler worked briefly at the law firm before entering the Army Air Force as a second lieutenant. That presumed connection and Cutler’s educational pedigree may have boosted his career when he transferred to the OSS.
When Cutler was assigned to London, the British were suspicious of Americans as not buttoned-up enough for intelligence work. But they’d heard of Yale and Wall Street. It also helped that Cutler was a white Anglo-Saxon and not German-American.
“I’m serious. Henry Reuss [the late congressman from Milwaukee] never would have gotten the job,” says Cutler. “We still suffer from that right now. The CIA and FBI have been greatly hurt by their not wanting to hire Arab-Americans. That’s paranoia. That’s nativism. But it’s a typical FBI police mentality.”
The starkest difference between then and now was that the World War II mobilization recruited able-bodied men across all social classes, while women and others left behind ran factories converted to war production and rationed and scrimped at home.
That sense of shared sacrifice is non-existent in the current war. Without a draft, all of the life-and-death burdens are borne by a volunteer army, drawn heavily from the economically deprived in rural America and urban minority communities. Very few Yale-educated Wall Street lawyers are signing up these days.
“Once the draft was removed, recruiting at the Ivy League level and among the bright college students really declined,” says Cutler. “Before that, Yale was sending all kinds of bright guys into the CIA.
“Modern America is now ‘Give me my stuff now.’ It’s very materialistic. The bright students want to be in-vestment bankers, which pays a fortune, or go to Silicon Valley.”
Restoring U.S. intelligence, Cutler says, will require better analysts and higher pay. “It’s been suggested we should acquire Wall Street lawyers or Silicon Valley people and pay them $250,000 a year,” he says. “These people would still be doing it for patriotism, mostly, but just for a few years.”
Cultural changes also have made it difficult to recruit the best people to work in Muslim countries, where intelligence is most needed.
“A very subtle problem is that now many couples both work,” he says. “What you want is an intellectual who’s good on geopolitical history and has a foreign language or knows Arabia. How do you get him to go to Saudi Arabia? There are no jobs for women in Saudi Arabia or Baghdad.”
It’s not like being assigned to Paris or Berlin, where an educated woman would have an array of cultural and em-ployment opportunities.
Cutler met his wife, Elizabeth Fitzgerald, the daughter of the late Edmund Fitzgerald, chairman of Milwaukee’s Northwestern Mutual Life, in Berlin when Liz was recruited by the OSS to work as a French translator during the Nuremberg war crimes trial.
In London, where Cutler was let in on the secret of Enigma, the war’s most closely guarded intelligence coup, he was indoctrinated in the amorality of intelligence that provides much of the intellectual conflict in the spy fiction of knowledgeable writers such as le Carré.
The biggest lesson he learned was that to preserve a secret, it was sometimes necessary to sacrifice innocent lives.
While the Allies were translating top-secret German communications, yielding a treasure-trove of advance information about German military plans, they could never react in a way that would reveal to the Germans the code had been broken.
One often repeated story was that Winston Churchill learned through Enigma of German plans to bomb Coventry, a cathedral town and major manufacturing center. So as not to tip off the Germans that the code was broken, it was said Churchill refused to allow his air force to intercept the German bombers and permitted the devastating attack. In truth, Cutler says, an attempt was made to disrupt the attack, but bad weather knocked out communications, fatally delaying British action.
The Coventry example was frequently compared to a story about the U.S. Army Air Force breaking the Japanese naval code and immediately using the information to shoot down Japanese Admiral -Yamamoto in the South Pa-cific at the precise time and place his plane was scheduled to arrive. The Japanese realized their code had been broken and immediately changed it, precluding the United States from learning far more valuable information.
“The secret is bigger than any -individual person,” says Cutler. “The British were masters at restraint, and they were our mentors.”
The American intelligence officers who were let in on the British secret of Enigma were an elite secret service within a secret service. Their work was so highly classified that they were not permitted to tell other members of the OSS they were working with British intelligence.
In Berlin, the OSS morphed into a scaled-down post-war successor called the Special Services Unit (SSU). In 1947, SSU merged into the CIA. Cutler’s initial mission for SSU was to track down German intelligence officers who were on an arrest list. The idea was to find out what had happened to captured American spies and to prepare war crimes charges in particularly egregious cases.
But almost immediately, the mission changed because Cutler and the Americans found that many former German intelligence officers had already been recruited by America’s wartime ally, the Soviet Union, to spy on America and other occupation powers.
Literally overnight, Cutler says, the intelligence operation in Berlin shifted from cleaning up details of the war against Hitler’s Germany to mounting the next major counterintelligence offensive against the Soviet Union.
“We knew long before Winston Churchill talked publicly about the Iron Curtain in that speech in Missouri in March 1946 that there was already a Cold War going on with Russia, except that it wasn’t quite so cold,” says Cutler.
The discovery of Soviet spying plunged Cutler into the secret intrigue of double agents that is the stuff of popular spy fiction. His mission was to find as many former German intelligence agents as possible and find out whether they were spying for the Soviet Union. If they were, the next step was to either convince them to become double agents secretly working for the United States or “neutralize them.”
That sounds like a euphemism for killing someone, but it wasn’t always direct. All German intelligence officers were on a permanent arrest list and could legitimately be sent to prison. For some, depending on what they had done during the war, that could be the equivalent of a death sentence.
Cutler’s chief agent was a former German intelligence officer code-named Zig-Zag. Zig-Zag not only provided the Americans with the names of 53 of his former colleagues but personally located as many of them as possible, turning many into double agents.
The task was made easier because many Germans had been coerced into working for the Soviets, whom they hated. “We never paid them money,” Cutler insists. “Remember, Berlin at that time had been battered by the Russian Army – lots of rapes, lots of murders. Hatred for the Russians was at an all-time high.”
The primary inducement offered by the Americans was a chance in the future to escape to the West, out from under the -Soviets.
After the war, Zig-Zag was given a new identity and continued to work in Germany for the U.S. government as an intelligence analyst. In 1952, Cutler learned that Soviet agents were hotly pursuing Zig-Zag. Cutler contacted the CIA, which brought Zig-Zag to the United States to become an American citizen as a reward for his service. The former lawyer and double agent for the United States became a carpet salesman at a Sears store in New Jersey.
Cutler and the Americans applied the lesson learned from the British about protecting secrets even if it meant sacrificing lives when the Soviets began kidnapping German scientists to work on nuclear bomb development.
The German driver for many of the Russian kidnappings voluntarily approached SSU, offering to provide advance information about specific attempts. Because the Soviets were targeting everyone from a Nobel Prize winner to high school science teachers, not all of the kidnappings were considered important to thwart.
When agents learned about a specific plot, they would consult scientists at the top-secret Manhattan Project, which developed the nuclear bomb in the United States, to determine if a targeted German scientist was a significant asset. Most targets were of so little importance that the United States let the Soviets proceed with the kidnappings, Cutler recalls.
In cases of extremely valuable nuclear scientists, preventing a kidnapping had to be cloaked in subterfuge so the Soviets would never suspect that their German driver had tipped the plot in advance. To protect one top scientist, British military police conducted phony raids and document checks over a wide area, forcing the Soviets to scrub a kidnapping because the dumb British had “bumbled” into the area.
Toward the end of his service in Berlin, Cutler presided over a “Joe House,” the term given for a safe house es-tablished for agents. Its operation shows how refined the gentlemen’s game of espionage could be back then.
In Berlin, Americans didn’t communicate with agents by radio because of the Soviets’ success in tracking transmissions. Instead, they set up safe houses in the American Zone where spies could come in from the cold and meet with their handlers face to face.
The Joe House was an oasis where agents, without revealing their true identities or missions to each other, would live together for days, enjoying maid service, hot meals and cognac after dinner. For a lonely, solitary spy risking his life in grim, bombed-out Germany, it was a reward for service that included medical and dental attention and even tickets to the opera.
“No one was thinking the Russians might come and kidnap the whole group,” says Cutler. “Having them all to-gether would have made it easier to make a mass killing. Fortunately, it never happened. The only security for the house was my .45 revolver.”
Cutler’s storied life shows the importance of luck. Like his chance connection to “Wild Bill” Donovan’s law firm, his marriage to Elizabeth provided a fortunate connection. Her father’s name would become internationally famous in 1990 as a result of Gordon Lightfoot’s hit song, “The Wreck of the Edmund Fitzgerald,” based on the Great Lakes sinking of an iron ore freighter commissioned by Northwestern Mutual Life. But the longtime NML executive was by then a legend in the development of Milwaukee.
Fitzgerald and Irwin Maier, the late chairman of The Journal Company, were the driving forces behind the Greater Milwaukee Committee, the ultimate group of powerbrokers who originally developed community landmarks such as the County Zoo, County Stadium, the War Memorial Center and the Performing Arts Center.
After the war, Cutler returned to the law in New York, where he and Liz had their first child. They were interested in getting out of New York to raise a family, and Fitzgerald was interested in getting his daughter closer to home.
Fitzgerald introduced Cutler to the heads of several major law firms in Milwaukee, including one that immediately offered Cutler more money than he was making in New York.
Looking back now, Cutler says the imagination and risktaking involved in espionage recurred throughout his law, business and civic careers after he relocated in his wife’s hometown in 1949.
“I created Brookfield after seven lawyers said it couldn’t be done,” says Cutler.
The seeds of urban sprawl, which could erode the tax base and political power of the City of Milwaukee, already could be seen after the war. For its own protection, Milwaukee countered with an aggressive annexation policy, nearly doubling its area between 1950 and 1960 from 51.8 to 91.7 square miles.
Many Town of Brookfield residents saw incorporation as a city as a way to protect themselves from possible annexation by Milwaukee. But the Brookfield area lacked the population density required by court decisions at the time to incorporate.
But that apparent illegality was not an insurmountable obstacle for someone experienced in espionage. The strongest opponents to incorporation were an entrenched town board, whose powerful chairman lived in the less populated western part of the township that wouldn’t be included in any annexation.
Cutler reasoned that if 60 percent of residents petitioned for the incorporation, far more than the legal requirement, the town board wouldn’t challenge it in court. They would realize that if they did, they’d be thrown out of office.
“That’s risktaking,” says Cutler. “But did I learn that in OSS? I think it’s more likely OSS recruited people who already had diversified talents, including imagination and ability to read and deduct.”
Cutler’s strategy worked, and it set him up as an established legal expert in an emerging field. Cutler personally handled the incorporations of Mequon, Muskego and others and represented Brown Deer in a long-running legal battle with Milwaukee over how to divide up the Town of Granville on the Northwest Side.
In the 1980s, Cutler’s attraction to risktaking paid off on a personal level when he and his wife invested in a broad range of Silicon Valley start-up companies, including Compaq Computers.
“You know, if you’re going into a high-risk investment, you should go into 10 of them,” says Cutler. “Maybe one will be a gusher and nine can flunk. Going into one is way too risky. More is less risky. We went into 38, and half of them went bankrupt. But three of them earned so much money they more than paid us back.”
Cutler sees intelligence today as shockingly unprepared for a war on terror. He claims on good authority that there were no CIA agents in Iraq as recently as 2003. “The British had five agents, and I’m told most of them were unreliable.”
Critics fault the Bush administration for politicizing intelligence to give answers the president and vice president wanted, whether the information was accurate or not.
“That was a major, major factor,” says Cutler. But he doesn’t see anything wrong with politicians demanding that in-telligence recheck conclusions. It’s intelligence professionals’ job to present reliable information.
“The CIA in recent years has gotten away from what it once did very well,” Cutler says. “That is have analysts who are objective, well-informed people who know the country very well and know who the -sources of the information are.
“In the Iraq fiasco, they relied on -sources like this Curve Ball (blamed in the Final Report of the 9/11 Commission for misinformation on weapons of mass destruction in Iraq). CIA people wrote reports from what this guy was saying without ever having a CIA agent meet with him. At some point, the CIA was ordered to meet him, and the Germans told them, ‘You don’t want to meet him. He’s crazy.’”
Joel McNally is a regular contributor to Milwaukee Magazine.
