David Eli Lilienthal

David Eli Lilienthal (1899-1981), American public administrator, was director of the Tennessee Valley Authority in its formative period and then became the first chairman of the Atomic Energy Commission. Steven Neuse in David E. Lilienthal, described him as, "one of the century's most noteworthy public figures."

David E. Lilienthal was born in Morton, Indiana, on July 8, 1899. His parents, Leo and Minnie (Rosenak) Lilienthal were Czechoslovakian immigrants. His father, a storekeeper, moved his family from town to town across the Midwest. Lilienthal graduated from high school in Michigan City, Indiana. He received his bachelor's degree in 1920 from De Pauw University, where he was elected to Phi Beta Kappa. Not only an intellectual, he also obtained a reputation as a light-heavyweight boxer. Three years later, Lilienthal earned a law degree from Harvard Law School and married Helen Marian Lamb. They later became the parents of a daughter, Nancy Alice, and a son, David Eli. At Harvard, Professor Felix Frankfurter stimulated Lilienthal's interest in natural resources.

Specialized in Public Utilities Law and Administration

For a few years, Lilienthal was a member of a Chicago firm that specialized in labor law. In his own practice after 1926, he served as special counsel for the city of Chicago in a suit against the Bell Telephone System that eventually brought $20 million to the city. From 1926 to 1931, he also edited the Public Utilities Carriers Service for the Commerce Clearing House of Chicago. By 1931 Lilienthal had become known as an expert in public utilities law and administration. His reputation took him to Wisconsin, where Governor Philip F. LaFollette, asked him to reorganize the Public Service Commission. On Lilienthal's recommendation utilities statutes and the operation of the Public Service Commission were overhauled to give the state effective control over privately owned utilities. Lilienthal's success led several other states to employ his model for similar legislative changes. As an able administrator, he attracted President Franklin Roosevelt's attention to help lead America's first corporation created by an act of Congress.

Head of the TVA

In 1933 President Franklin Roosevelt chose Lilienthal as one of the three codirectors of the Tennessee Valley Authority (TVA). Congress created the TVA to rehabilitate the entire valley of the Tennessee River and help its inhabitants out of poverty. Roosevelt envisioned programs for flood control, the provision of cheap electricity, the improvement of navigation, and the education of farmers in modern techniques. Lilienthal managed the power program and introduced an enormous hydroelectric dam building program. Lilienthal's vision of massive economic development of the valley conflicted with the views of Chairman Arthur Morgan. The controversy on the TVA board ended with Morgan's resignation in 1938. Lilienthal's changes also drew the wrath of private interests, who could do little to stem the TVA's developments. However, he forbade his employees from participating in politics, declaring that, "A river has no politics." Three years later, on September 15, 1941, Lilienthal became board chairman. An earnest conservationist, he introduced programs to teach the valley's farmers techniques to stem soil erosion and the importance of cheap fertilizers.

After the U.S entered World War II, TVA took on added responsibilities to meet expanding wartime needs. TVA power made possible the creation of the vital nuclear research installation at Oak Ridge, Tennessee, and provided cheap power for high-energy consumption industries, such as wartime aluminum manufacturing. Through his contact at Oak Ridge, Lilienthal acquired new interests in the field of atomic power. By 1945 the TVA was America's largest producer of electric power and the per capita income of the region had risen 73% above its prewar level.

Truman Named Lilienthal Chairman of the AEC

Congress established the Atomic Energy Commission (AEC) in July of 1946 to develop America's nuclear resources under a civilian energy program. On October 28, President Truman named Lilienthal as the AEC's first chairman. In addition to developing nuclear energy he headed the commission in developing the atomic bomb. His years with the AEC were stormy. This was the era of steadily deteriorating Soviet-American relations, of frequent frustration of American power overseas, and of mounting national paranoia on the question of Communist infiltrators in the U.S. government. The AEC received its share of congressional investigations and accusations, and Lilienthal was personally under attack much of the time, countering accusations of Communism because of his Czechoslovakian ancestry and charges of mismanagement. Lilienthal tendered his resignation to Truman in November to take effect on December 31, 1949, ending nearly 20 years of government service.

Private Businessman

In 1950 Lilienthal toured the United States delivering a series of lectures entitled Atoms for Peace, which advocated less government secrecy but continued government control in atomic energy and research. He then began a new career as a business executive. Initially he served as an industrial consultant to the Carrier Corporation and to the international banking firm of Lazard Frères and Company. Then he built up an aggregation of mineral and chemical patent companies, in the process accumulating a sizable personal fortune. In 1955, with Lazard Frères backing, Lilienthal and his TVA successor, Gordon Clapp, founded the Development and Resources (D&R) Corporation. It provided managerial and technical services to foreign nations for developing natural resources through TVA-like projects. By 1967 the company's fees totaled over $3 million a year. At President Lyndon Johnson's instigation, Lilienthal and his associates signed a three-year contract with the federal government to plan the development of the Mekong Delta in South Vietnam. Although D&R initially had with significant successes, it ultimately failed. D&R met its downfall in the late 1970s principally because of its associations with two of America's greatest foreign policy disasters: Vietnam and Iran. Lilienthal's optimism and faith in domestic success overshadowed the difficulty in transferring American economic values and technologies abroad.

Private Life and Death

Lilienthal published seven journals, Journals of David E. Lilienthal, covering most of his adult life, from meeting his wife until a few days before his death. During the war years he published his best-selling book TVA: Democracy on the March (1944), which defended the policies of the TVA when it was under threat. A few years later he produced This I Do Believe (1949) as a result of the congressional hearing in 1948. He received honorary LL.D. degrees from DePauw University (1945), Michigan State University (1949), Boston University (1952), and the Universidad de Los Andes, Colombia (1954). He was bestowed with many awards, including the Freedom Award from Freedom House (1949) and the Public Welfare Medal of the National Academy of Sciences (1951).

Lilienthal died in New York City on January 14, 1981. Shortly after Lilienthal's death, Arthur E. Schlesinger, Jr. wrote to his wife Helen: "Dave was one of the remarkable men of the century—remarkable especially in his unflagging and unquenchable commitment to the possibility of constructive work— so rare in an age given over so sadly to the work of destruction."

Further Reading on David Eli Lilienthal

The best source for Lilienthal's career is The Journals of David E. Lilienthal (4 vols., 1964-1969), which is complete through 1959. Lilienthal's other major published writing is Big Business: A New Era (1953). Biographical sources include: Willson Whitman, David Lilienthal: Public Servant in a Power Age (1948), basically a paean to Lilienthal's work with the TVA; The National Cyclopaedia of American Biography, Volume I, James T. White and Company (1960); New York Times (January 16, 1981); Steven M. Neuse, David E. Lilienthal: the Journey of an American Liberal, The University of Tennessee Press (1996). The TVA's inception and its early development are treated insightfully in Arthur M. Schlesinger, Jr., The Age of Roosevelt (3 vols., 1957-1960).