On a recent Charlie Rose program, New York Times columnist Abe Rosenthal's anxieties about the aggressive expansionism of China were " balanced" by a young Asian woman, Alice Young, who denounced such fears as imperialist and expressed doubt that China was even worth worrying about. Don't forget the Cold War, she warned, when we were frightened of something we now know didn't exist. This is the old anti-anti-Communist line in a nutshell: The Cold War was an excuse for McCarthyite persecution of idealistic progressives at home and an alibi for defense buildups and interventions against a chimerical Red Empire abroad.

Nothing defined the early Cold War times so much as spectacular spy cases, the very first of which -- the forgotten story of Amerasia magazine -- gets an airing in The Amerasia Spy Case: Prelude to McCarthyism by Harvey Klehr and Ronald Radosh (University of North Carolina Press, 266 pages, $ 29.95). Klehr is the coauthor of The Secret FYorld of American Communism, which once and for all demonstrated that the American Communist party was primarily an arm of Soviet espionage; Radosh is co-author of The Rosenberg File, whose damning conclusions about the executed couple have been confirmed by recent decodings of Soviet material. With their eyes wide open about American Communists and sympathizers, the writers have an amazing tale to tell.

In 1936, radical socialire Frederick Vanderbilt Field and the Institute for Pacific Relations started a new magazine, Amerasia, a left-leaning journal about China. Field appointed one-time greeting-card manufacturer and maverick never-quite-Communist China specialist Philip Jaffe as editor. In 1937, Jaffe made an enthusiastic tour of the Communist-held part of China. By 1941, Field had withdrawn his financial support from Amerasia and World War II had cut off the receipt of propaganda from China. By 1944, Jaffe and assistant Kate Mitchell were writing the whole mag, which cost a then-substantial 15 cents and was printed on good glossy paper, by themselves.

Desperate for filler, Jaffe began going to Washington to cultivate sources. He met Lt. Andrew Roth, the Naval Intelligence liaison to the State Department -- a lefty Asia hand whose hobby was Japanese communism. Roth introduced Jaffe to Emmanuel Larsen, a civilian "China expert" who worked at State. Larsen started giving Jaffe official China documents, which Jaffe published virtually verbatim. For example, the January 26, 1945, issue of Amerasia contained a top-secret and potentially damaging report on the details of the anti-Japanese Thai resistance movement.

This reckless publishing policy came to the notice of the Office of Strategic Services, the precursor to the CIA, whose chief investigator Frank Bielaski promptly put the Amerasia office at 225 Fifth Ave. under surveillance. On Sunday night, March 11, 1945, the OSS entered the empty but messy office, finding a well-equipped darkroom and photocopies of some 20 top- secret government documents.

Bielaski's men took a few with them to Washington. On March 14, Secretary of the Navy James Forrestal gave the case to the FBI, which began trailing, bugging, and phone-tapping Jaffe.

On April 19, 1945, the FBI x. Jtapped a hotel-room meeting between Jaffe and John Stewart Service, a brilliant upper-level State Department China hand, the China-born child of missionaries and Berkeley graduate who'd been the American liaison -- and an increas, ingly critical one -- at the corrupt court of Chiang Kai-Shek until six days before. Service saw the Chinese Reds as devoted to "agrarian reform, civil rights, the establishment of democratic institutions" the same Chinese Reds soon tO inaugurate one of the three most homicidal tyrannies in human history.

Service boasted to Jaffe that he " had, while in China, been getting the Office of War Information to disseminate copies of Amerasia. Service and Jaffe went on to a party at Andrew Roth's place. They made a lunch date for the next day; Service showed up with State Department papers. (Service's defenders were later to describe this as being "helpful to journalists.") Even his fanatical collaborators were surprised at Service's aristocratic hubris, his blithe air of invulnerability; by contrast, said City College of New York graduate Andrew Roth, "I was very cautious, a working-class kid." In April 1945, Jaffe was approached by Soviet agents, whose advances he welcomed, feeling as he did that "the first test of a real radical is, do you trust the Soviet Union through thick % and thin, regardless of what anybody says." NOTH By mid-May, federal DEIN agents had entered the Amerasia office six EARL times; their bugs had WA recorded Service promising to procure for Jaffe military secrets (American fleet movements, possible American troop landings in China) and, in general, anything harmful about Chiang's regime.

The FBI now wanted to move Ion Amerasia, confident that its entries and tappings were legal because its surveillance had been undertaken to recover documents stolen in wartime. President Harry Truman gave the okay, and -- after a mysterious delay-on June 6, 1945, Jaffe and his assistant were arrested at the New York magazine office, while Roth, Larsen, and Service were picked up around Washington. Authorities seized 1,722 documents. Jaffe and Mitchell were defiant and legalistic; Larsen crumbled and began the first of many contradictory and self-exculpating confessions; Service was haughtily indignant; Roth was silent. On June 8, the leftist I.E Stone, writing in the New York fellow-traveling tabloid PM, called the arrests political persecution, claiming the officials were just leakers and asking, "Is the leak to be a right-wing monopoly?" This became the party line of anti- Stalinist liberals, too: Max Lerner and Drew Pearson promptly denounced the arrests.

With Service threatening to make a stink at trial about the Chiang corruption he was "merely" trying to expose, New Deal wheeler-dealer extra- ordinaire Tommy Corcoran sprung into [NG SO action behind the EDTHE scenes. (Klehr and Radosh cannot track COLD Corcoran's steps exactly and are reduced to sniffing by-paths.) Corcoran was counsel and partner of financier T.V. Soong, Chiang's brother-in-law. Corcoran was also making himself very useful to Attorney General-designate Tom Clark (father of Ramsey). Clark was a mediocre hack whose nomination was in trouble in the Senate; Corcoran called in Hill favors and soon all was well.

Jaffe's choice for lawyer was the law partner of powerful Brooklyn progressive Rep. Emmanuel Celler. Jaffe's assistant, Kate Mitchell, turned to her uncle, a rich Buffalo Republican lawyer. The Department of Justice picked as prosecutor the very unenthusiastic Robert Hitchcock. Hitchcock presented the evidence to a grand jury, supposedly seeking indictments on charges both of embezzlement of government property (Jaffe had paid Roth and Larsen) and, more seriously, of conspiracy to commit espionage. Did the grand jury vote to indict? Astoundingly, no one yet knows, for Attorney General Clark shelved and sealed the grand jury results. Clark let Mitchell off; Corcoran schmoozed Service into shutting up. Soon after, a second grand jury was sworn in, but Hitchcock himself kept Service from being indicted. In court, Hitchcock torpedoed his own case, slamming FBI methods and saying those arrested were guilty only of "an excess of journalistic zeal." / Jaffe was fined $ 2,500, Larsen $ 500. All the well-connected defendants were off; it was a " politicalOPEN AI fix." The unconnected and truculent Roth was left dangling, but charges against him were also THE ADT eventually and quietly dropped in February 1946.

The whole thing stank so thoroughly that even the Democrat-controlled House voted 277-111 to investigate the Amerasia bungle. But the fix was still in: Sleepy, safe Sam Hobbs of Alabama was chosen as chairman. Sessions were held in secret in his office; there were no oaths and no staff counsel. Larsen, who had given the magazine its first State Department documents, fingered Jaffe and Service, but then waffled; Hitchcock blamed the FBI's clumsiness. Chairman Hobbs squelched affidavits about White House and State pressures to delay the arrests and to clear Service. The Hobbs committee's October 1946 majority report whitewashed Justice and lambasted State's "lax" handling of the purloined documents!

The case would not die. Loose-cannon Larsen, addicted to "con-fessing," published an article in the right-wing magazine Plain Talk naming Service and four others at State as agents of a gigantic conspiracy; these wild charges did more harm than good. Then during the summer of 1948 in an eerily similar case -- Whittaker Chambers accused State official Alger Hiss of what amounted to espionage for the Soviet Union, and the spy-case focus moved elsewhere for a time.

Not for good, however. In 1950, Sen. Joe McCarthy named Service as one of those 57 "card-carrying" Communists at State he had on his notorious "list." Four weeks later, a special subcommittee of the Senate Foreign Relations Committee -- chaired by Democrat Millard Tydings -- met to consider this and other charges by McCarthy against State. The Democrats expected to expose McCarthy's list as nonexistent (it was), and his charges as unjust (well, up to a point, Lord Copper).

Larsen approached McCarthy with a promise to expose Service in public but then got cold feet and changed his story for the umpteenth time. On May 4, 1950, the Tydings panel began a six-week rehash of the Amerasia case alone. Robert Hitchcock, the strangely unenthusiastic Justice Department prosecutor, told the subcommittee it was a pure coincidence he'd gotten a cushy job at the Buffalo law firm run by the uncle of Kate Mitchell (she was, remember, the assistant in the Amerasia offices). Republican Sen. Henry Cabot Lodge, who was on the Tydings committee, grilled Justice witnesses about the military significance of some of the documents; Justice waffled and blamed the FBI again for its sloppiness and excess of zeal. Lodge defended the FBI practices. This public mention of military documents was a bombshell, alerting the world at large for the first time that the Amerasia case involved real espionage and not just bitter differences about China. On the stand, Larsen said he K. Jhad no idea Jaffe and Roth were Reds and that he really gave them only, oh, "eight or ten" documents. Jaffe took the Fifth, was cited for contempt, and was acquitted in 1951. Then came the last major witness, Service. He really had no idea, he testified, what Amerasia's politics were; he didn't even like Jaffe; he misspoke when he promised to deliver "military plans" because he had never been privy to such stuff anyway; and he barely knew Tommy Corcoran, the fixer who had feared what Service might say about his client, Chiang Kai-Shek.

It was a performance our authors very charitably call "lacking in candor." Lodge -- who emerges from this story with credit, one of the very few to do so -- did not buy Service's story. He and fellow Republican Bourke Hickenlooper filed a minority report accusing the sub-committee of ignoring the official sabotaging of the case.

The majority report found "no shred of evidence" of a coverup. It called McCarthy's accusations a Nazi-like "big lie." It labeled the editors of Plain Talk, Isaac Don Levine and Ralph de Toledano, as "despicable," and attacked Lodge and Hickenlooper by name as lazy and ill-informed. All in all, a piece of Soviet-style overkill that betrayed guilt and nervousness. When the Tydings document came up for debate in the full Senate on July 20, Republican senator William Jenner called its Amerasia section "a whitewash of a white- wash," and Tydings went ballistic in a two-hour harangue, comparing Jenner to Joe Stalin. In a straight party-line vote, the Democrats approved the partisan and mendacious report. Two days earlier, Julius Rosenberg had been arrested in New York.

What can we learn from the Amerasia spy case? About the Red agents there is little that needs to be said. About their high-born collaborators there is. Sure of their perfect virtue and contemptuous of imperfection, some elitist bureaucrats of the Roosevelt years projected virtue onto communism and imperfection upon the likes of Chiang. They were then willing to cooperate with professional Communists by giving them, for uses to be determined by the Communists, government secrets, even military ones. The Democrats were long in power and swollen with arrogance. Like the ward heelers so many of the Trumanites were, they manipulated Justice and State to cover up an explosive situation -- prelude to Watergate! -- and then sat on Congress to cover up the coverup -- prelude to Whitewater, pre-1995!

There's a sobering truth about McCarthy's role in all this. Of course, McCarthy was a gift to the Democrat establishment. As a character says in The Manchurian Candidate, "If the Soviet Union had constructed a tool to discredit anti-communism, they could have come up with nothing better than Joe McCarthy." Without approving of him, one has to note that his publicity- seeking flamboyance did get the Amerasia case the only thing resembling a public hearing it has ever had, and that his "investigator" Tydings did not come off as much of a moral improvement. McCarthy's charlatanism stands as a warning to conservatives not to let their noble causes into the hands of demagogues.

I wish I could admire Klehr and Radosh as much for their story-telling knack as I do for their scholarly industry and for the moral fineness and courage it took to tell this tale honestly even today. But the book is a trial to read, jumping back and forth in time and requiring at times almost a jigsaw-puzzle-like reassembly of its data. One more rewrite with a sharp editor looking over their shoulders would have done the trick. Still, The Amerasia Spy Case is good and necessary and -- even 46 years later -- timely.

Donald Lyons writes regularly for the Wall Stree Journal and the New Criterion.

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