Lenin’s Willing Industrialist: The Saga of Armand Hammer, Part 4: The Real King of Oil, and the Importance of using a Bagman

Part 1
Part 2
Part 3

Although the definitive biography of the Jewish billionaire Marcel Reich is called The King of Oil, the title probably belongs to industrialist Armand Hammer, for perhaps no one did as much to alter the political and economic geography of the global oil scene than he did. Others may have accumulated more wealth with oil, but few used their wealth to exert such leverage.

As in all of Armand Hammer’s endeavors, the narrative he prefers to tell of how he succeeded in gaining a foothold in the global oil scene is a self-serving fairytale that doesn’t bear close scrutiny. In Hammer, he claims that he managed to outbid the Seven Sisters oil cartel by extending an offer to King Idris to search for an oasis in Kufra, Libya. Just as Armand Hammer ostensibly wanted to feed the Russian peasants so many years before, he would now quench the thirst of an impoverished and tiny Middle Eastern nation languishing in “its medieval poverty” (Epstein 228). This story, which “has all the elements of a fairytale — a good king, a kingdom imprisoned by lack of water, and a wise man who shows the king how to lift the curse from his small kingdom — became the conventional account of how a small, inexperienced American oil company got the richest prize in Libya” (Ibid.).

His narrative of supposed “enlightened altruism” (Epstein 23) hid the fact that he had paid a “multimillion dollar bribe to a key official in the Libyan royal court” (Ibid.). In Hammer’s defense, a certain level of bribery was de rigeur when operating in oil concessions at the time. A “financial editor who specialized in the internal operations of Standard Oil Company of New Jersey, the parent company of Esso Libya” (Blumay 116), told Hammer’s PR flack that any “company involved in the Libyan auction bribes the ministry” but that what distinguished Armand Hammer’s bribe from the usual ones on offer was “the astonishing amount of money that Doctor Hammer threw around” (Ibid.).

Deeper digging revealed that Armand Hammer was using some of the same tricks in his bid to corner the oil market that he had used in the art world. Only this time instead of appropriating funds from unwitting investors or extracting money from a board of executives whose employment depended on Hammer’s whim, Occidental had “underwritten its vaunted Oasis project with Libyan funds” (Blumay 259) without the knowledge of the Libyans. Journalist Christopher Rand’s expose, Making Democracy Safe for Oil, “contended that Occidental had … reneged on promises to the Libyans, overproduced its oil-fields” (Ibid.) and even alleged that John McGuire, a supervisor with Bechtel had his life threatened when he attempted to play whistleblower on Hammer’s doings. Hammer was livid with the accusations, especially considering that information about similar operations of bribery regarding “Occidental’s Venezuelan activities” (Ibid.) was already underway. “Deny everything he says,” Hammer told Blumay, “especially the death threat crap. … Do everything you can to discredit him. I’m going to call the lawyers. If there’s a way to drown this bastard in litigation, I’ll find it” (Blumay 260).

Hammer’s other stroke of good luck in Libya was that a revolution was underway. And just as in Russia, Hammer used a great upheaval to his advantage once again. He ignored the unified front represented by the market price the Seven Sisters were willing to pay and struck a deal with Muammar Ghaddafi after a coup d’état ousted King Idris from rulership. Armand Hammer had shifted the balance of power in the Middle East as assuredly as he had tipped the scales in favor of the Bolshevik government under Lenin some decades before:

With the stroke of a pen, Hammer had acknowledged the ultimate sovereignty of an oil-producing nation over its oil — and had forever changed the geopolitics of oil. After this, the Middle Eastern dominoes began to fall. Once the oil companies had agreed to Libya’s terms, they came under pressure from Iran, Iraq, Saudi Arabia, and other Persian Gulf nations. The Shah of Iran, for example, demanded — and received — an even better profit-sharing arrangement. Libya then had Hammer and the other Libyan concessionaires match Iran’s terms. In a matter of months, the control of oil had begun an ineluctable shift from the Seven Sisters cartel to the oil-producing nations. (Epstein 245)

It might seem tempting to infer that Hammer was neutral to the pan-Arab movement sweeping the Levant, or that he did not at heart remain a Jew and loyal to Israel.  But that was not the case. Much as the dossier compiled for a young J. Edgar Hoover revealed in the past, Armand Hammer was still willing to do a deal with the devil, but that would not keep him from offering ultimate loyalty to Shema Yisrael.


Hammer was a master dissembler in many respects. Throughout his career, he demonstrated an especially quicksilver tendency when it came to either concealing or brandishing his Jewish identity, based on the audience in attendance or the motive he had in mind.

He tells a massive, verifiably untrue whopper in the early pages of his autobiography, claiming that during his youth in New York City there “was a synagogue next door, but none of the members of my family ever attended services there. Jewish observances had gradually ebbed out of my family’s life by the time I was born; and my parents had, in effect, become members of the Unitarian Church” (Hammer 55).

Julius and Rose Hammer were Russian-born Jews who debated whether they should ultimately pursue a specifically Jewish form of Bolshevism or foster a secularized, non-Shtetl-oriented internationalist socialist revolution. Unitarianism was never on the agenda. Armand Hammer’s supposed Unitarian identity was a post-hoc, hastily constructed lie that he fabricated to make sure that his Jewishness didn’t create too many problems for him while siphoning oil from the grounds of the Middle East. It was a spur-of-the-moment thing, designed more to assure that his head remained attached to his neck than anything else. His brother Victor Hammer expressed his concerns to Carl Blumay: “Armand may not accept the fact that he was born Jewish … but that’s not going to matter to the Libyans. He could be kidnapped or murdered while he’s in Libya. Like it or not, he’s got to watch his step” (Blumay 97). After conferring with his brother Victor and seeing the wisdom in his counsel, Armand decided to pick a faith. He used some employees as a sounding board. “The Libyans have funny ideas about Jews,” Hammer began, “and I don’t want them to think I’m Jewish. I think I should join a church. Name some religions” (Ibid.). His executives rattled off some faiths. “Methodist … Roman Catholic … Presbyterian … Baptist … Unitarian ….” (Ibid.). Armand paused at that point and asked, “What’s Unitarian? … Look it up” (Ibid.).

Armand was not only trying to avoid being murdered or kidnapped with his impulsive conversion. He was also intent on controlling the fallout from a story that appeared in the March 1966 edition of Arab Oil Review, “which described his Jewish background and the efforts he had made in the 1950s to raise money for Israel — which was essentially accurate” (Epstein 231). Hammer would eventually do everything he could to help Israel, and would later confess that he had been secretly attending meetings there (and had even recommended specific doctors and medical treatments to Menachem Begin), but for the time being he needed the oil that was flowing from Libya:

Hammer went on to defend himself against the ‘malicious lie’ that he was Jewish and a supporter of Israel: “I have never been in Israel and never have been a member of any organization that collects contributions for Israel, nor have I or any company I have been associated with had any business dealings with Israel. Therefore, you can see how sinister this unfounded rumor is.” (Epstein 231)

Long after he had gotten what he needed from Libya (but before the neocons attacked the nation under the guise of progressive leadership during Obama’s tenure), Hammer would drop the unitarian charade and embrace his Jewish identity. Even more importantly he would use the store of knowledge he had acquired wildcatting in the oil business to try to help his homeland. From the final pages of his autobiography:

Today we have nearly half the State of Israel under license, and for the first time in the country’s history, systematic seismic work has been carried out. By January 1987 we will have begun drilling and we will discover whether God put oil into the substrata of Israel, just as he did with her neighboring countries. The seismic work looks very encouraging-and our geologists are optimistic. John Kluge, an investor in the Israeli oil venture and a longtime friend of mine, asked that I give at least one week’s notice before any drilling takes place. A Jewish friend of his will make a special prayer for our success in finding oil. It is certainly worth a try! On another front, Occidental is working with Israel Chemical, Ltd., the Israeli chemical conglomerate, on several notions, and while nothing has been consummated yet, it looks likely that we will reach an agreement soon. If we can find oil in Israel, and help increase the base of Israel Chemical’s economy, we can transform Israel into a self-sufficient state much less exposed to the vicissitudes of world politics. Muammar el-Qaddafi may not think that a very admirable ambition, but the prospect fills me with joy. (430)

Hammer’s dedication to Israel was, like his dedication to the communist project, not solely about money. Armand Hammer used his influence in the service of Israeli/Jewish politics, especially with the Russians, in order to give his fellow tribesmen a bit of victor’s justice that they might not have enjoyed without his intercession. In Hammer, the Doctor brags that “the Israeli government asked me to help obtain some documentation crucial to their case against the Nazi war criminal known as Ivan the Terrible” (431). The suspect, accused of operating gas chambers at Treblinka and killing thousands of Jews, was John Demjanjuk. He claimed not to be the man they sought, but the Israeli government didn’t believe him and looked for proof that he was the alleged Ivan the Terrible. Armand Hammer offered to grease the skids using his longstanding Soviet connections:

The Soviets had the documentation — the original SS identification card of ‘I.N. Demjanjuk’ — but would not release it to the Israelis. I explained the situation to Anatoly Dobrynin, and in December 1986 he presented me with the document the Israelis needed for prosecution. When I forwarded it to Vice Premier and Deputy Foreign Minister Shimon Perez, he and the entire government were elated. Besides thanking me personally for my “tireless efforts on behalf of the State of Israel, the Jewish people and the cause of justice and human rights the world over,” he wrote: “Please convey our appreciation to the Soviet authorities for their cooperation in the effort to bring Nazi war criminals to justice.” (Hammer 431)

Hammer promised the Prime Minister of Israel that he would give his warm regards to Anatoly Dobrynin and Mikhail Gorbachev, in the hopes that the extension of goodwill would serve as “ an opening wedge to further cooperation between the two governments” (Hammer 431).

Hammer’s about-face regarding his Jewish identity (and his activism on behalf of the Jewish state) serves as an object lesson regarding a theme that has been touched on at The Occidental Observer in the past. The fact that a powerful Jew does not openly embrace explicitly Jewish philanthropic causes and stresses his universalism ad infinitum does not mean that he won’t make a return to his Jewish roots at some point, and put the full brunt of his wealth and power into a project he previously feigned indifference toward.


It should be added at this point that neither George Soros, Mark Zuckerberg, nor any other wealthy and powerful Jew one cares to name demonstrated Armand Hammer’s specific fluency as a sociopath. Hammer was known for his ability to cry on cue, and it was not abnormal for mortal foes to emerge from meetings with him totally converted to the Doctor’s way of thinking. It was a hypnotic brand of charisma which he claimed to have admired in Vladimir Lenin, and which seemed to rub off on him after his time with the dictator in Russia. It was this talent for socially engineering people (when bribery or threats weren’t involved) that allowed him to mostly avoid paying for his crimes in a court of law. The closest he came was when fallout from the Watergate investigation proved that some of his kingmaking machinations had technically been illegal, since he had circumvented new laws regarding the disclosure of campaign contributions exceeding a certain amount. Even then, however, Armand Hammer found a scapegoat whom he convinced the take the rap.

Tim Babcock, the former governor of Montana, was recruited by Hammer and used as a bagman to make illegal campaign contributions on behalf of the Doctor. He had this to say about his role as a fall-guy: “Whenever I work for someone, I’m as loyal as I can be. Unfortunately, in this case I was too loyal” (Blumay 287). President Lyndon Johnson’s advisor, Marvin Watson, commenting on the affair said that “there are some people who know something but say the opposite, and then convince themselves that the lie is the truth. If they were hooked up to a lie detector machine, their lies couldn’t be detected because they’ve done such a good sell job on themselves. That’s the way it was with Armand” (287).

Even spreading the blame among loyal employees, however, and with one of the most formidable legal teams ever assembled, Armand Hammer was forced to plead guilty to violating campaign contribution laws during Richard Nixon’s reelection campaign.

Hammer went to absurd lengths not only to avoid doing any jail time, but even to avoid appearing in the courtroom. According to his own account in Hammer:

I was seventy-six years old, had suffered intermittent bad health for more than twenty years and had twice submitted to major surgery within the previous three years. In addition, I was under immense strain in my business life, between boardroom battles, the crazy menace of Oxy’s Libyan connection and the fathomless complications of doing business with the Soviets. (413)

Thus, “to be confronted at such a time with the threat of a criminal conviction was more than my heart could stand. It didn’t quite give out, but it gave notice of a desire to quit” (Hammer 413). Hammer claimed that under “no circumstances, said my doctors, was I to go through the strain of a trial. It could, quite literally, kill me” (Ibid.).

Public Relations wizard Carl Blumay had to keep many plates spinning to both accommodate his boss’s lavish demands and to keep the truth of Armand Hammer’s good health secret during the ongoing trial. He managed to keep the name of the hospital where Armand Hammer was staying under wraps, and “to discourage eyewitness accounts, Hammer was allowed no visitors” (Blumay 276). Concealed from public scrutiny that could undermine his claims to be at death’s door, “Armand Hammer ran Occidental from his hospital bed. Executives memoed him continually and received speedy replies. Whenever he called me, he sounded fine and on top of everything. Usually, when I called him, I got a busy signal and I left a message with the floor nurse. One day she remarked that Armand ‘was the busiest patient they ever had’” (Ibid.). Armand Hammer’s wife Frances corroborated this account, complaining to Carl Blumay that her husband was “‘running me ragged’ … It seemed nobody believed that Armand was seriously ill, but no one was going to voice that opinion out loud” (Ibid.).

Victor Hammer described his brother’s ability to deceive others, claiming “‘Armand’s natural sense of drama allows him to seem a great deal sicker than he really is. … If he can put himself to sleep at will and wake up exactly when he wants to, you can imagine how good he is at making himself look like he’s at death’s door. He was betting on the fact that no doctor was going to put a seventy-seven-year-old man with chest pains and shortness of breath into an even more stressful situation’” (Blumay 277).

After spending six weeks in hospital feigning mortal illness, Hammer pleaded guilty to violations of the Federal Campaign Contributions Law. After discovering he would receive no jailtime, he “returned to the hospital unaware that reporters were watching … waved away the wheelchair and strode into the building,” (Blumay 281), capping the afternoon literally dancing “a little victory jig once he thought he was out of view” (Ibid.).

The Jewish tendency to plea for sympathy and feign weakness to better conceal strength was another weapon Hammer managed to produce from his toolbox to avoid paying any substantial price for his crimes. The worst that could be said about his conviction on election fraud charges is that it stymied his desire to be Time magazine’s Man-of-the-Year and his campaign to win the Nobel Peace Prize. That he even considered himself a candidate for the latter is a stunning example of his hubris, though perhaps even worse men have not only been nominated but have won the award.

Go to Part 5

Works Cited

Blumay, Carl. The Dark Side of Power: The Real Armand Hammer. Simon & Schuster, 1992

Epstein, Edward J. Dossier: The Secret History of Armand Hammer. Random House, 1996.

Hammer, Armand and Neil Lydon. Hammer: The Armand Hammer Story. Perigee Trade, 1988.

17 replies

Comments are closed.