Cadillac Desert (13 page)

The only person who seemed suspicious when Lippincott began showing Eaton and Mulholland around the Owens Valley again and again was one of his own employees, a young Berkeley-educated engineer named Jacob Clausen. His apprehensions had been aroused during Eaton’s second visit, when Lippincott and Eaton had ridden up to the valley from Los Angeles by way of Tioga Pass and Clausen, at Lippincott’s request, had met them at Mono Lake. On the way down the valley, Lippincott insisted that they stop at the ranch of Thomas Rickey, one of the biggest landowners in the valley. Rickey’s ranch was in Long Valley, an occluded shallow gorge of the Owens River, hard up against the giant Sierra massif, which contained the reservoir site the Reclamation Service would have to acquire in order for its project to be feasible. Eaton had told Clausen that he wanted to become a cattle rancher and was interested in buying Rickey’s property if he was willing to sell. As they visited the ranch, however, he seemed much more interested in water than in cattle. Clausen understood the dynamics of the Owens Valley Project—the streamflows, the water rights, the interaction of ground and surface water—better than anyone, and Lippincott asked him to explain to Eaton how the project would work. Eaton hung on his every word, and that, Clausen was to testify later, “was exactly what Lippincott wanted.” The two Los Angeleans were good friends, and Eaton had been the first to dream of Los Angeles going to the Owens Valley for water. Was it so farfetched, Clausen would remember thinking to himself, to believe that Lippincott was out to help Los Angeles steal the valley’s water?

If Clausen’s suspicions were aroused, those of his high superiors remained utterly dormant, even though they would soon have equal reason to suspect Lippincott of being a double agent for Los Angeles. In early March of 1905, Lippincott had sent his entire engineering staff to Yuma, Arizona, on the Colorado River, to move the Yuma Irrigation Project forward at a faster pace. Work on the Owens Valley Project had been held up by winter and by the delayed arrival of a piece of drilling equipment which was on order. During the hiatus, the Reclamation Service received a couple of applications for rights-of-way across federal lands from two newly formed power companies in the Owens Valley. Each was interested in building a hydroelectric project, and Lippincott had to decide which, if any, of the plans could coexist with the Reclamation project. Unable or unwilling to look into the matter himself, Lippincott might have waited for one of his engineers to return later in the spring, but he wanted to dispose of the issue, so he decided to appoint a consulting engineer to look into the matter for him. And though there were dozens of engineers in Los Angeles and San Francisco among whom he could have chosen, he decided to turn to his old friend and professional associate Fred Eaton.

The news that Lippincott had hired Fred Eaton to decide on a matter that could affect the whole Owens Valley Project left his superiors stunned, but their response, typically, was one of bafflement rather than anger. “I fail to understand in what capacity he is acting” was the only response Arthur Davis managed to give.

Eaton himself had no questions about the capacity in which he was acting, though the public face he presented was very different. With his letter of introduction from Lippincott and an armload of freshly minted Reclamation maps, he strode into the government land office in Independence, claiming to represent the Service on a matter of vital importance to the Owens Valley Project. For the first three days, however, his investigations had nothing to do with the hydroelectric plans. Poring over land deeds in the office’s files—deeds to which he might have had no access as a private citizen—Eaton jotted down a wealth of information on ownership, water rights, stream flows—things Los Angeles had to know if and when it decided to move on the Owens Valley’s water. Handsome and charming, Eaton even managed to get the land office employees to help him, unaware that the information they were digging out had nothing to do with the matter that had allegedly brought Eaton there. When he finally had what he felt he needed, he turned to the official matter at hand.

The problem of the conflicting power-license applications was straightforward; there could only be one resolution. One of the two power companies, the Owens River Water and Power Company, held water rights senior to those of its competitor, the Nevada Power Mining and Milling Company. Its rights even predated those of the Reclamation Service, and if it was refused its application it might cause the Service some real legal embarrassment. In addition, its plan of development was far more compatible with the Reclamation project than the Nevada company’s; Jacob Clausen had taken a cursory look at both and decided that the Nevada company’s project could reduce the Long Valley reservoir to a glorified mudflat during the peak summer irrigation season, when water was needed most. To Clausen, the applications were hardly worth a second look, and he couldn’t understand why Lippincott had even bothered to hire someone to review them so carefully. The Owens River company deserved a conditional go-ahead, the Nevada company decidedly did not. But Clausen was far too naive to understand the complexity of such matters: One of the founders of, and partners in, the Nevada Power Mining and Milling Company was a rancher named Thomas B. Rickey.

Eaton’s baffling recommendation in favor of the Nevada Power Mining and Milling Company threw Clausen into a state of apoplexy. When Lippincott formally endorsed his judgment a few weeks later, Clausen finally understood that something was terribly wrong, but how wrong even he could not fathom. On the 6th of March, exactly three days after Lippincott had hired Eaton as his personal representative in the matter of the power company applications, the city of Los Angeles had quietly hired its own consultant to prepare a report on the options it had in its search for water. The report had taken only a couple of weeks to prepare—most of the information was in Mulholland’s office, and the conclusion was foregone anyway—and the consultant had received an absurdly grandiose commission of $2,500, more than half his annual salary. It was not so much a commission as a bribe. The money, however, was well spent: the name of the consultant was Joseph B. Lippincott.

One other person besides Jacob Clausen had begun to follow the comings and goings of Eaton, Lippincott, and Mulholland with more than detached interest—Wilfred Watterson, the president of the Inyo County Bank. Wilfred and his brother, Mark, were the most popular citizens in the Owens Valley. Their family had founded the bank, and Wilfred and Mark, when still in their twenties, became president and treasurer. Both were attractive young men, but Wilfred in particular was strikingly handsome. He had clean-cut, perfect features, an absolutely even gaze, and the erect, confident air of a nineteenth-century optimist. In his elegant clothes, Wilfred could have passed easily for Bat Masterson instead of a small-town banker. The lending policies of the Inyo County Bank were as much of an aberration as its owners. The Wattersons rarely refused a loan and often stretched out debts; they displayed a strong interest in the valley’s survival and a casual, almost careless attitude toward money.

Wilfred’s suspicions that Los Angeles was engineering a water grab had begun to simmer when word got around that Fred Eaton, the would-be cattle rancher, was offering some astonishingly generous sums for land with good water rights. There were stories that Eaton would make an offer that already seemed generous, and, if a landowner gambled and tried to raise him, Eaton would readily meet his terms. It was hard for Wilfred to nail any of this down, because no one wanted to let the Wattersons know that he was thinking of selling out—not after they had loaned money with such abandon up and down the valley—but the stories were enough to make Wilfred skeptical about Eaton’s true intentions. Was he rich enough to pay those prices? Where did he get the money?

Watterson’s suspicions became intensely aroused one day in the early summer of 1905 when an unidentified young man arrived in the valley, went directly to the Inyo Bank, and displayed a written order from Fred Eaton to pick up a parcel in a safe deposit box. As soon as he had it in his hand, the young man left with unseemly haste and stalked down the street in the direction of the post office. Watterson sprang up from his desk and asked the teller who the man was. He was Harry Lelande, the Los Angeles city clerk—the official legally charged with handling any transactions for the city that involved transfers of water or land.

Watterson burst out the door and ran down the street in the direction in which Lelande had disappeared. He found him across the street from the post office.

Watterson ambled up to Lelande, accosted him in his disarming manner, and said, “I’m sorry, Mr. Lelande, but there’s a small formality we forgot to carry out at the bank.”

Lelande looked perplexed. Watterson asked him to follow him back to the bank.

Once they were safely inside the president’s office, Watterson offered the clerk a seat and some coffee, then walked casually to the door and locked it. “We want the deed back,” he said.

Lelande looked stricken. “What deed do you mean?” he asked.

“The deed by which your city is going to try to rape this valley,” Watterson answered.

“I haven’t any idea what you’re talking about.”

“Maybe this will help,” said Watterson. He opened his desk drawer, removed a revolver, and put it on top of the desk.

Lelande’s mouth opened. “I can’t give you something I don’t have,” he begged.

Watterson stood up and hovered menacingly over the clerk. “Take off your coat and trousers,” he said.

Lelande, badly frightened, obliged.

Watterson turned all of his pockets inside out and found nothing. He ordered Lelande to get dressed and take him to his room at the Hotel Bishop.

“Eaton’s been buying land in an underhanded way to secure water for the city of Los Angeles, hasn’t he?” Watterson said to Lelande on the way over. He was inventing the theory as he walked, but Lelande’s agonized expression told him he was right. “You’ve paid high prices not because you’re dumb but because you’re smart. You’re masquerading as investors and all you’re going to invest in is our ruin.”

Lelande kept insisting that he didn’t know what Watterson was talking about. At the hotel, Watterson nearly tore apart his room, but found none of the documents Lelande had extracted from Eaton’s box. It was obvious that Lelande had been so fearful of being discovered that he had immediately run to the post office and mailed the deed. Without the document, Watterson had nothing to go on but his hunches, and he was forced to let Lelande go. But, his temper notwithstanding, he knew he would have had to let him go anyway; the clerk had done nothing against the law. Neither, from what he knew, had Eaton. Was it possible, Watterson asked himself, that a distant city could destroy the valley he and his family had worked so hard and gambled so recklessly to build up, and never step outside the law?

Meanwhile, the $2,500 contract accepted by Joseph Lippincott from Los Angeles was, if not exactly illegal, an apparent violation of the most basic ethical standards for government officials. Newell had let Lippincott off with another fatherly lecture, but everyone in the Reclamation Service had heard about it, and since the Service had been created as an answer to the epic graft and fraud associated with the General Land Office, some of Lippincott’s associates were furious with him. By July of 1905, Newell realized that the whole thing might blow up in his face; he had to do something to contain the damage. As a result, he decided to appoint a panel of engineers to review the conflict between the Reclamation project and the water needs of Los Angeles and decide whether the Owens Valley Project should move forward, be put on hold, or be abandoned. Newell felt that Lippincott, as the senior engineer most familiar with the project, should sit on the panel. To his and Lippincott’s astonishment, several Reclamation engineers said they would refuse to sit next to him. Lippincott now realized that he, too, would have to mount a damage-control operation in a hurry. On July 26, the night before the panel was scheduled to convene, he dashed off a telegram to Eaton that read, “Reported to me and publicly accepted that you had represented yourself as connected with Reclamation and acting as my agent in Owens Valley. As this is entirely erroneous and very embarrassing to me, please deny publicly or the Service will be forced to do so.” The truth of Lippincott’s denial can best be judged by Fred Eaton’s reaction, which was incendiary. He received the telegram in the federal land office in Independence, where he was still trying to masquerade as Lippincott’s agent. After reading it he felt compelled to vent his spleen on the nearest person available, agent Richard Fysh. “Eaton said he had a telegram from Mr. Lippincott and it was a damned hot one,” said Fysh later in a deposition, “and he, Eaton, did not like it a little bit, as it put him in a wrong light.”

Newell’s panel of engineers was convened in San Francisco on July 27. After two days of hearing divided opinions (Clausen testified in favor of continuing, Lippincott in favor of abandonment), the panel reached a unanimous verdict. The Owens Valley Project should not be sedulously pursued, they recommended; the needs of Los Angeles had become too great an issue. But neither should it be formally abandoned until a more persuasive case could be made for doing so. Los Angeles would have to demonstrate that it had absolutely no choice but to go to the valley for water, and it would have to prove that it had the resources to carry out such a gigantic undertaking on its own. Such a recommendation, the panel added, was of course based on the assumption that the Reclamation project was still feasible.

Which, unbeknownst to anyone but Eaton and a select handful of Los Angeles officials, it was not. Four months earlier, after completing his consultant duties for Lippincott, Eaton had gone back to see the stubborn Thomas Rickey, who held the key piece of land in the valley—the land the city had to have in order to block the federal project—but who had refused to sell. In Eaton’s hand was his recommendation that Rickey’s hydroelectric company be allowed to usurp its competitor’s claim on the main power sites on the river. That, Eaton thought, was the sweetener that would surely make Rickey sell. After hours of pleading and cajoling, however, the rancher still held out. In disgust, Eaton finally stood up, roughly shook Rickey’s hand, and stomped out the door. As he was standing at the railroad depot, waiting for the train that would take him back to Los Angeles, Rickey raced up in his carriage. He had had a sudden change of heart; for $450,000, he told Eaton, he would sell him an option clear on the ranch, including the Long Valley reservoir site.