[TAPE 1, SIDE A]

WALTER E. CAMPBELL:

This is Walt Campbell interviewing Mack Pearsall in his office in Rocky Mount, North Carolina, May 25, 1988.

Well, Mr. Pearsall, I thought we would begin by just letting you talk a little bit about your career and then from there move into your family's background and then into a few specifics about your father and the Pearsall Plan. So please.

MACK PEARSALL:

Okay Walt. Well, it's a pleasure to have you here. From a personal background standpoint I was born on March 11, 1937. Born in Rocky Mount, North Carolina. Born into a family that had somewhat of an agrarian tradition. My grandfather and his father started a mercantile business and an agricultural processing and provisioning business back in the late 1800s, which is the environment that my mother grew up in. She grew up in Battleboro, North Carolina which is a little bit north of here. I had a couple of uncles, or at least my grandfather's brothers, one was a physician and one started the Planters' National Bank in Rocky Mount. So from a traditional standpoint I'd say that we've been in eastern North Carolina for a long time and family-wise, have been involved in the creation or evolution of a number of institutions here. That all tends to affect your focus on life and your philosophy on life.

I, of course, went through the years of the Second World War observing that and watching very carefully and seeing how that influences one's outlook. I went to public schools here in Rocky Mount. That was back during the time when they had separate but

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equal school systems. So I had very little interaction at that point with members of the black community from an academic standpoint. I had a tremendous amount of interaction with members of the black community from an agrarian standpoint because of the fact that during that period of time the holdings for which my father was responsible involved about 1,000 tenant farmers, most of whom were black, practically all of them were black. So I would spend my summers with my father traveling on the farms, and I had an interaction with a lot of young black children that I've grown up to see—now that I'm grown, but it was more in a, I suppose, tenant-landlord relationship that I, that they viewed the relationship. There was a certain distance that I reckon was just inherent in that relationship. But I did go to school here in Rocky Mount until the eighth grade.

At that time, my parents decided that my long term education could be better served by going away to a private school. They looked at a lot of schools out of state, ultimately choosing the Asheville School for Boys in Asheville, North Carolina. I went off to the Asheville School at about twelve and a half years old with my initial greeting being that you will repeat the eighth grade because we started foreign languages and algebra back in the eighth grade, and I had not had that in grammar school. I spent five enjoyable, rigorous, intimidating years, I reckon, in that environment, which back in that era, it certainly didn't have the liberal and flexible overtones that it does now. You stayed there, and they kept you scared to death that you were going to fail out the whole time. I think it was part of the

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strategy to keep your nose to the grindstone. And it was a commitment. It was a commitment that was undertaken under duress. I definitely didn't want to go away to school and miss all the social circumstances that were available in high school and be subject to the strictures of an all boys' school environment. But in retrospect, I think it was the finest thing that my parents could have done for me. And it again points out the fact that children don't have a knowledge base sufficient to make a lot of those critical path decisions along the way. I spent five enjoyable years there, involved in athletics. I did not have an outstanding academic record because I enjoyed myself in many ways socially and athletically.

Finishing that, I suppose, it was more or less preordained, in the sense of family tradition, that you would go to UNC-Chapel Hill which I wanted to go to anyway. And from not only going to UNC-Chapel Hill, but going to the Deke House where my father was a Deke, and I had a brother who was two years older that was a Deke. So I went to the Deke House and to Chapel Hill and spent an enjoyable college career, not really very committed to the academic side of things because basically the first two years was a repeat of what I'd already had in prep school so that I was able to coast. I coasted perhaps for too long and then collided with the fact that I hadn't been tending to my business and ultimately ended up leaving UNC-Chapel Hill to go into the military for a short stint on the six-month, six-years type National Guard Reservist type program. During that stint, before I returned to Chapel Hill, I got married. And when I came back,

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I had a greater sense of dedication to finishing my junior year at Chapel Hill.

I decided at that time, because of a lack of focus in the undergraduate area, that I would go ahead and skip the third year and go right on to law school with the combination AB-JD degree, LLD degree. So I went out of, finished the undergraduate program and went on to Chapel Hill to law school where apparently I got pretty enthused about things and with the, let's say, the taming of my life style by being married and having a certain sense of responsibility. I enjoyed an, you know, interesting academic undertaking. I did very well. Graduated with honors; was on the Law Review.

Again, I suppose, almost in a preordained fashion—my father was an attorney who had practiced for some years. Had been a district attorney down here. Then at the time that my grandfather died, and my grandmother began to seek some advice and counsel and guidance on running the farms, he got involved in that aspect of it. So he began to be pulled away from the practice of law into the practice of business. A brother-in-law had tried it before that and didn't like it, but my father seemed to be more inclined and involved, you know, in agriculture and excited about it, and he ultimately ended up tracking in that direction. So that during my childhood years and during my early adulthood, I had observed him as a licensed but non-practicing attorney who had devoted a good portion of his time and business interests to agriculture.

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But those interests had begun to spread out in the early 1950s. He got into an oil distribution business. And then through contacts with Governor Luther Hodges and Harold Makepiece and Senator B. Everett Jordan, he became acquainted with the Howard Johnson restaurant/motel franchise system. At that time Governor Hodges had as many of the Howard Johnson system franchises as any one person was allowed to have at that time, which was five.

Because my father had been involved in politics and because my father had made a commitment, at Governor Hodges' request, to come back into politics after he had left in the early 1950s, having decided that he would not run for governor…. I have seen the booth in Charlotte Airport where he pointed to me, that he and Dan Moore sat down and decided who was going to run for governor. My father had made that decision back in the early 1950s—that he wanted to return home to be with his family and did not want to be owned by the party which is a part of the process when you're elected to the highest elected office in the state.

So I observed his political activities and his involvement in agriculture, and I suppose, it was more or less preordained that I would come back and practice law, sort of on a part time basis for two or three years. And then at the same time, I inherited the responsibility for the agricultural investment side of the house. I spent ten years in that side of the house, and it became apparent that I couldn't run that business and stay on top of the legal end of things sufficiently to where it wasn't

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too expensive to my clients to keep current every time I had a new problem, a new situation to face. So I came out of law school in 1963, moved back to Rocky Mount, and immediately went in to be his understudy in the M.C. Braswell Company. I went through the debutante, naivete stages of reorganizing that company. That was one of the great things about my father. That is, he would see you making a mistake but unless it was a significant mistake or one that he thought was terminal, he would let you make it for the purposes of gaining your own education and developing your own sense of judgment.

I think he had a certain commitment and emotional involvement in agriculture that I never had. My emotional commitment to business is basically that I enjoy the process, the actual business that I'm in doesn't make a whole lot of difference to be. I enjoy just being in various types of business. But he had an emotional attachment to agriculture. We used to laugh a lot because I've never found in my history of twenty-five years of being around agriculture, if you added up all the money you made and all the money you lost in that twenty-five years, you'd be behind the game. It used to be that you lived poor and died rich because you had inflation to build the values in there—that your heirs would live well if you did not live well. You know that's been deflated.

But I got, you know, I was more or less selected as lead member of the next generation. I have a brother who's older who's been involved in various types of landscape architecture. He went to landscape architecture school. He's a graduate of

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Parsons, Pratt, and lots of other places, and he's chosen a different work style than I have. I had a cousin who had his own business ventures, and therefore the responsibility for running the business affairs of my mother and two aunts, at least from an agricultural standpoint, fell my lot as it had fallen my father's lot, by choice, in the early 1930s. He had chosen to go over there and help my grandmother take over that venture, and he had gotten very involved in it. At that time, agriculture was the basic industry, the primary industry, of North Carolina, and it was a primary footing for a major political base across the state, with the Grange and the Farm Bureau. He was involved in politics, and he developed a lot of contacts through his agricultural involvement that sort of fitted into the process of being elected and being appointed to various boards, the Milk Commission and things like that. I took on the agricultural situation because it was more or less what was expected. I spent ten years over there wrestling with it during periods of cost-price squeeze and trying to make it into a factory which it just does not lend itself to that type of structure. It's a business that consists of a lot of entrepreneurial people who are individually in it for reasons other than strictly making money. It's a lifestyle and other sorts of things, and I didn't relate to the lifestyle like my father did. I mean, he used to go out….

WALTER E. CAMPBELL:

This is the M. C. Braswell Company?

MACK PEARSALL:

Yeah, the M. C. Braswell. He used to go out, and he'd ride around on a Sunday afternoon or a Saturday and talk about

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how tall the corn was, and he'd pat the cows on the tail and say what kind of a good time we're having. And I'd say, "What's in the bank account?" And he'd say, "Nothing." Then I'd say that's what counts, you know, what's important to me. In order to understand his psyche and understand the things that motivated him—if we understand his love for the land and his love for agriculture and understand the empathy that he developed over the years for the disadvantaged position of the black race, and the efforts that he made in a humanitarian vein over the years which earned him the Harvey Firestone Landlord-Tenant Award, which I've got at home, a plaque, back in the late 1940s, early 1950s, you understand what the man was made up of, and you understand where he came from as he dealt with various types of political problems.

He was a great student of human nature. And I can remember to today how he used to compare the black race to the white race in terms of, the fact that blacks just don't seem to carry grudges like white people do—that was something that he marveled at. That that group of people as a race seemed to be able to overlook the transgressions that had been heaped upon them. And I think he felt a great sense of responsibility and a great purpose to see that their position in life was changed—that they were given an opportunity.

I can remember back in the 1960s when we had a farm that was adjoining the town of Battleboro, and we were able to get the town of Battleboro to extend water out there to that farm. At that time the FHA was lending a lot of money for people to build

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houses. It gave my father no end of pleasure to be able to ride through that subdivision and see the children of former tenants who had been on the Braswell farms and the tenant themselves, who had ultimately been eliminated from agriculture because of mechanization, to see them have a decent brick home with a landscaped yard and nice cars and the amenities that only economic where with all can provide.

The family was part of that process because we happened to own some very key industrial land here and we sold some of that industrial land off, and I can remember how happy he was to see former tenants and their children working for Abbott Laboratories and making a good salary and being able to afford things for themselves and their children that prior generations had never been able to. They had been released from the bondage of an agricultural lifestyle which was living from hand-to-mouth where you basically produced what you ate. It was a subsistence existence. They never had any discretionary income. They never could afford the things that the people who were working in public work could. And it was that transition from total dependence on agriculture to a better balance with industry here that made him so enthusiastic because he saw an opportunity for these people to upgrade their own lifestyle. That was something that I experienced, and I watched him do that. Watched the pleasure that it gave him because it was part of his political and part of his sociological philosophy.

WALTER E. CAMPBELL:

When did you sell the industrial property? Was that early '60s.

MACK PEARSALL:

We started selling industrial properties back in the mid-1960s. When I got back here, one of the first things that we did was sell off 100 acres of land to Abbott Laboratories which has turned out to be the largest single employer in Rocky Mount with over 2,000 employees. They're getting ready to make a major enlargement. They're a tremendous corporate citizen, etc. They have changed the landscape in this area for so many people, and they are obviously an equal opportunity employer. It's just been phenomenal what has happened there.

WALTER E. CAMPBELL:

Did you lose any of your farmers to Abbott Laboratories, or most stayed on the land? Do you know?

MACK PEARSALL:

Well, I think that's happened more in the last few years, Walter, than it did earlier. I think there was a mind-set among many people in agriculture that industry was going to steal the best labor, and for that reason, the two could not coexist. I think those people in agriculture today recognize that while that did happen, mechanization, in fact, ran more people off the land than the arrival of industry did. That even today, today even more so, they are appreciative of the fact that with the type stress that has taken place in agriculture in the last few years, that there are places that people can go to work in this area without having to pick up like the Okies did and move far away. I mean, I think that many of those people who viewed industrialization as a negative back then, now see it to be very positive, and it allows them to remain in the area and be employed. When in fact, if they had to rely on their income from

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agriculture, they couldn't possibly make it. So it's been an interesting loop back.

WALTER E. CAMPBELL:

How do you think your father would have felt about the changes? Would he be glad to see that it's become more industrial and less agricultural, or would he have liked to have had that balance throughout with more of a concentration on, probably, agriculture, do you think?

MACK PEARSALL:

Well, I think he was more interested in the improvement of the lot of mankind than he was in any one specific industry prevailing. He had the philosophy that eastern North Carolina had been very good to the Braswell and the Pearsall families, and that there was a responsibility on the part of the families to return some of that reward that we had reaped from it. And I think you find that manifested in the fact that he convinced my two aunts and my mother to give the two hundred acres for Wesleyan College as a part of that being a new dimension for this area in terms of livability and opportunities for higher education. We can talk about Wesleyan College cycling through now and what it's going to do for this area, and I think that if he were here today, he would be very pleased with what he would see in terms of industrialization, and he probably would like to see more of it so more people could have an opportunity. He would be very excited about the arrival of Dr. Les Garner here at Wesleyan College and Les' new mission to be a catalytic force in helping eastern North Carolina move from where we are, which is in some form of a transition into a global economy where our

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dependence on agriculture is getting even more threatened with the potential demise of tobacco.

The worldwide competition for agricultural products would have run contrary to his theory. He was a great believer in Malthus' theory that the population grew geometrically and the capacity to produce grew arithmetically. I think that is a philosophy that he and I differed on because I observed the technological revolution that was taking place both within this country in terms of productivity and what was taking place elsewhere in the world. He kept believing that there would ultimately be world wide famine, and that, for that reason, the farm community would be able to coalesce in a manner that would allow it to gain a better return to its investment. That has never taken place in my lifetime. I don't believe it will. I think we're even going contrary to that now because there are antagonistic elements even within agriculture, you know. The cow people want low corn prices, and the corn people want high prices. But that was a philosophy that he had. He tried to imbue that into me, you know, Malthus, Malthus, Malthus. There would be this great famine and worldwide, and the prices would go up, and we'd get an opportunity. But that hasn't worked, and I'm convinced it's not going to work. And for that reason, I'm moving out of agriculture because I don't have that psychic commitment that he did. I don't derive that psychic enthusiasm out of it that he did. It's nice to go out and walk around on the farms but it doesn't help to put anything on the table unless you're interested in lifestyle only.

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I think it is noteworthy and interesting that a recent Wall Street Journal an article came out that talked about the split-level economy in the southern part of United States. And it talked about two recent publications, "Shadows over the Sunbelt" and "Half Way Home and a Long Way to Go." In that article it made the very clear point, and I don't have to go far to the east of where I'm sitting to prove that point, that for years we had a group of short-sighted leaders who wanted to keep low taxes and limited government. They were people who owned land who basically were in those elected positions or they controlled or influenced the people who were there. And they didn't really step out front to try and create a new economic dynamic for the next generation. And there are areas of eastern North Carolina that are now suffering badly because of that lack of farsightedness. The Branch Bank just did a study that shows that out of the forty counties in eastern North Carolina, twenty-five of them are going to get blacker and poorer in the next twenty years unless somebody turns it around. This is a mission that Les Garner has chosen for his college, to do something about the plight that faces eastern North Carolina.

My father would have been very discouraged at that type of thinking, that type of small thinking, that type of racially prejudicial thinking, that type of what I call "plantation mentality"—of keep everybody down on the farms. That wasn't his idea at all.

Back during the 1940s when he got the Harvey Firestone Award, he had employed on our payroll the equivalent of agricultural extension people, helping the farm tenants, helping

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these tenants understand how to can their own foods, to improve the health, to improve housing conditions. He was ahead of his time, and he was criticized by other land owners for being problack or a "nigger-lover" or whatever you want to call it. But that was the human side of the man, and that was the thing—that he had empathy and felt pain for that disadvantage.

WALTER E. CAMPBELL:

Before going on and pursuing some of that with him, why don't you go ahead and explain exactly what you're doing now with Pearsall Operating Company. You say you're moving out of the agricultural end of things.

MACK PEARSALL:

Well, let me describe how I got over to this side of the house.

WALTER E. CAMPBELL:

Okay.

MACK PEARSALL:

Basically, I had been at Braswell Farms for ten years, and I recognized that that was a cul-de-sac of no reward financially.

WALTER E. CAMPBELL:

This was '63 to about '73.

MACK PEARSALL:

'63 to about '73. At about the time of the energy crisis, I came over to this side of the house. Now, this side of the house was the motel and restaurant side of the house which was started as a result of my father's contacts with B. Everett Jordan, etc. and Luther Hodges. We got our first Howard Johnson restaurant franchise here in Rocky Mount in 1956, and then grew that into five or six Howard Johnson restaurants and motor lodges over time, all of them in North Carolina.

WALTER E. CAMPBELL:

Was this to stimulate tourism or a part of that or was it… ?

MACK PEARSALL:

Well, it was a diversification effort. It was an effort on his part to have a different footing for our economic dependency. Also, I think it was an effort on his part to demonstrate both to himself and to the community, his own economic independence. You see, he had married into a family that was wealthy by eastern North Carolina standards, at least measured in land. And I think that there were many who felt that he had simply ridden the coat tails of that opportunity and had never done anything on his own. I think, subconsciously, when he started the oil company over here as an independent venture with his own money that he had earned from his salary over there, and when he started the Howard Johnson business over here, that was a manifestation of the degree of financial independence from the Braswell family, to convey that he had the capacity to do it on his own. So that's why we got this activity going on over here. And I came across in the middle of the energy crisis to manage that side of things.

And I can tell you how dumb I really am. I remember in 1963 Leonard Rawls and Jimmy Garner, who started Hardee's food systems, that is right here in Rocky Mount, came to me and wanted to know did we want to get into the Hardee's franchising business. I looked at their P and L's and all that, and I looked at the fact that they were making only 50% gross profit on the sale of hamburgers, and I didn't look at the fact that they were making 85% gross profit on the sale of french fries and drinks and shakes. And I said, "No, I believe we've got enough going over here in our Howard Johnson's restaurants to take care of

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us." And they said, "Well, at least, can we borrow a copy of your franchise agreement with the Howard Johnson Company because our lawyer has never seen a franchise agreement." Here we are in eastern North Carolina, and had never seen a franchise agreement. I said, "Fine. I'll be glad to let you have a copy." Well, they went to see my two cousins, second cousins, who were running a service station on South Church Street, Mayo and Nick Boddie, and got them interested in it, and they now have three hundred Hardee's. So, you know, you can't call all of them right. That was a major mistake that I made at that point in time.

But I took over the Howard Johnson restaurants and motor lodges, and I recognized that that particular company was being lead by a guy who wasn't going to take us any damn where. He wasn't hungry enough, and he was a disembodied voice, you know, out of New York City belching out commands in Boston because his wife wouldn't let him leave New York because she wanted to be a part of the New York social circle. And I said, "Well, hey guys, you know, this is not going anywhere. Let's go find something else to do." About that time Hardees was about to go under financially. They employed a new CEO, Jack Laughery, who came in here and took over and turned it around. And I said, "Well, you know, fool me one time, your fault. Fool me twice, it's my fault." So when they started with the second wave of Hardees, we decided to get on board. So we started developing Hardees back then and now we've got nine. Did have twelve. We sold three two weeks ago. That's been a major development area for us—is to work on the Hardees.

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But quite frankly, with the variety of responsibilities that I have, between serving on, actively serving on, the Planters' Bank Board and long range planning committee, on the executive committee, trying to run a farming operation, trying to run motels, trying to run Howard Johnson's restaurants, trying to develop real estate, I haven't had a lot of time to concentrate in any one area. And that's been, that has probably slowed the level of development that would have taken place over here. Basically, right now, Pearsall Operating Company operates four Howard Johnson restaurants and motor lodges, a Quality Inn, an independent restaurant at Nags Head on the Outer Banks, and also operates nine Hardees restaurants located in the Savannah, Georgia area, a thirteen county area down there, which keeps me busy.

But a big part of my time, because I was brought up under the philosophy that you had to contribute something to life, you couldn't retire from your community regardless of whether you had wealth or not, and I've got a lot of friends who retired from the Democratic Party because they've made a little money and joined the Republican Party. And some of them have concentrated principally on wealth accumulation. But my father imbued in me early on that the real treasures to be laid up in life are not those that you can find in your bank account. The real treasures to be laid up in life are relationships that you develop and a sense of having made a difference. A sense of having made some contribution to the change and the welfare of mankind along the way. I don't say that in any self-serving way but he believed

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that. And he imbued that in me as I observed him in public service, as he would serve on various commissions and committees and at the university level and at the head of the Roanoke Island Historical Association. Things he didn't have to do but things that he felt keenly would make a difference in the life of eastern North Carolina. So I spend a substantial amount of my time involved in just that type of activity which means that I don't have the same amount of time that others do to spend on business. But if there's a psychic side of life to gain, you know, psychic income and that satisfaction, then that's the direction that I get it from.

WALTER E. CAMPBELL:

Do you see that happening with the school merger issue at this point? Could you tell us a little bit about the merger issue? Your role in it? Is this kind of an extension of, again, some of the problems your father might have faced with the Pearsall Plan?

MACK PEARSALL:

Yeah, I wouldn't be so bold to suggest that it's a contemporary equivalent but I would say on a microcosm, on sort of a micro basis, it has a lot of similarities. What we have going on here is a battle that I've been involved in for ten years. The battle basically consists of the fact that Rocky Mount has the uniquely disadvantageous distinction of sitting astride a county line which means that it's politically emasculated in terms of its powers east and west. Because we're not a city of 50,000 people, we're two cities, one of 25, one of 15,000, or 35 and 15,000. Probably about fifteen, maybe ten years ago, up until ten years ago, there'd been a release program

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between Nash County and Rocky Mount where whenever Rocky Mount expanded its city limits, the county would release the children that lived in that area to go to school in the Rocky Mount school district. At least from my standpoint—and I think there is plenty of evidence that will support it, which we will have to bring out as evidence in court—the termination of the county's land and student release policy was racially motivated.

Nash County for racial reasons decided that they were going to stop that release program because they saw that what they were getting into their system at long last were white middle-class affluent parents who had an interest in PTAs and in their children's education. The county decided not to let the Rocky Mount school system grow at all and to take all those people into their system because that would help the transition from being a rural system into a combination with more of an urban favor to it and more political clout because these are the people who've got political clout. Well, the reverse of that is they locked up the Rocky Mount school system, and through white flight, the Rocky Mount school system has gone from a system that would be racially reflective of the Rocky Mount city population to where it's now about 80% black and 20% white. And that is a great disadvantage for this area because of the perception of remediality of any school system that is that racially imbalanced. We feel, that is the business community feels, that that perception has in fact cost us a lot of economic development activity here because we've been red-lined by certain national industry location firms because of the fact that there's a controversy going on. There

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are racial overtones to this thing, and a national company doesn't want to be a part of a community that has racial overtones to it.

My God, we've just gone through integrating one of our two local country clubs. I bet we've got the only fully integrated country club except maybe Chapel Hill, I would say, outside of an area like a Chapel Hill, which is a very enlightened community that's ahead of most areas in the state from the standpoint of race relations. We've just gone through integrating one of the two country clubs here in town on a full membership and utilization basis which is unheard of in eastern North Carolina. The reason we did it is because I was traveling on the road this summer, and Bill Friday called me and said that Irwin Miller, chairman emeritus of Cummings Engine Company that has a $355 million dollar in Nash County, called him up and said that the race relations and morale of their local plant was so bad because the black executives could not join the country club in Rocky Mount, that something had to be done. We happened to catch that country club at a point where it was on the verge of near bankruptcy, and the Rocky Mount business community came to the new buyer and said, "If you will come in with a fully integrated program for membership and utilization, we will support you." And next week we're probably going to give him $400,000 to help him make that "the" club in town. Now, that is an enlightened move on the part of this community to get shed of some antebellum shackles. 'Cause you can't have a community that doesn't accept black executives and expect companies to come here. They can't

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promote people through here when they've got to say, well, we'll promote but you've got to go to Rocky Mount and you can't do that. You've got Hardees food system with a lot of black executives. You've got a lot of black executives that come into town that are executives for them in other areas of the country.

They come in and they can't even play golf. I mean, this is ridiculous in 1988. So we've been able to integrate that. And that's one of the major strides, we think, towards making this community more wide open. I got a letter the other day from the first black to play golf at that country club telling me how much he enjoyed it, and I sent a copy to Mr. Miller, I said, "Mr. Miller," I put my handwritten note on it, I said, "You know, this makes life worth living and right worth fighting for." And he sent me a personal letter back saying how much he appreciated what we'd done in Rocky Mount. But that's another manifestation of the fact that you've got a hold over in this area among some very short sighted people of an anti-black attitude. That they should be separate but equal. And you've got county commissioners in this day and time saying that blacks ought to be in separate schools.

The great advantage of the school fracas is that the values of housing on the east side of Rocky Mount is going downhill so blacks can finally afford housing over there. Well, that isn't what we need in this area. What we need is, and is to our strategic advantage, sustainable competitive advantage as we see it long term in this area, is a superior educational system for this two-county area. Because we understand why the northeastern

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United States beats our brains out. They've spent so much more money, over the years, properly funding the human resource at the primary and secondary levels all the way through school. That they have a very literate and numerate work force, and we do not. And unless we deal with that, we're not going to be competitive in this world economy. Hell, they can move plants offshore and do it a lot cheaper than we can do it here. It used to be that we had cheap labor but now if you've got cheap labor that is less educated than third world labor, they're not coming here because these people are not smart enough to run sophisticated machines.

So it all weaves back to this transition of these blacks coming off the farms and being integrated early on into this industry at menial levels, in sewing operations and things that don't require a lot of skills. Now, the maturation of the economy in the world and the fact that it's become a global economy, is forcing eastern North Carolina to face up to the fact that it is going to have to change its ways if its going to be competitive long term from an economic development standpoint. Because we just can't compete with cheap labor. We just cannot do it for what they can do it for in China or do it for in India and other areas of the world. It's really a social-economic sort of reordering of priorities down here when you change a country club. And that doesn't sound like big business to a guy in New Jersey. That's big business down in eastern North Carolina. And the school fight is over giving every child in this two—county area an opportunity for top quality education so we can have a labor pool that is smart enough to allow us to be able to induce

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industry to come in. And there are still people who are saying, "Well, blacks don't have the inherent capacity to learn and we need to keep them over there in the separate schools." We can't stand that type of mentality.

WALTER E. CAMPBELL:

Well, a lot of what you're saying reminds me of probably the situation that your father was facing at the same time with the Pearsall Plan. I'm not sure if all the dynamics are the same but in a way I perceive it as he was realizing that there was this transition going on between agricultural pursuits and industry, and that in some way preserving the schools was a big part of facilitating that transition. In other words, if we let the segregation issue, desegregation issue, disrupt our school system, we're going to be put back years. And we won't be able to make this transition. So that we have to provide some sort of safety or pop-off valve. Is that correct? Was he in a similar position in that way? Did he perceive those kinds of things going on? I mean, you've told me about his inherent sort of humanity towards black people, and I understand that that was probably a concern of his, too. Very much so, he had it a long time. But at the same time was he aware of what they needed to do to change North Carolina.

MACK PEARSALL:

Yes, I think he was very pragmatic in that regard. I think he recognized that if we were going to come into the mainstream of being an industrialized state that we were going to have to have an educated work force. I mentioned a few moments ago that we have never committed to the human resource at the grammar and secondary and high school levels, the kind of funding

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that they have elsewhere. And the reason we didn't and remember this, the university system in this state is probably overfunded and the basic elementary schools and through the high schools are underfunded and the reasons for that is quite simple—go back to the mentality of the planters. The planters knew that their children were going to the University at Chapel Hill, okay. So they made damn sure through the legislature that the university got well-funded so their children would get well- educated. And everybody who was left behind picked up what was left 'cause it was done on a local basis not on a statewide basis. And I think they assumed there would be some trickle down opportunity or advantage to those who were left behind. That you would have this enlightened leadership educated at the university level. Now, that type of attitude has to reverse itself and I think he saw that number one, the strength of a democratic society is having a good, solid, free public education system.

My wife and I, first wife that was, and I had a major decision to make in 1960, well, it was in 1970, my son was born in 1965, and in 1971 he was going into the first grade. That was the first year of the pairing schools in the city of Rocky Mount. And a number of my friends, affluent, wealthy friends, came to me and sat in this room right here and asked me to join in the creation of a private school here, the Rocky Mount Academy. And they asked me a give $50,000. And I told them after I talked to my wife, without batting an eye, we told them that they were wrong on two counts. Number one that we didn't have $50,000 to give them, and number two that we didn't believe in what they

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were doing. And that what they were doing by withdrawing their children, would be withdrawing their interest in the public school system, and they would solve their problem with a checkbook and it would ultimately come back around to haunt them. And I'm here to tell you today and I don't like to violate the eleventh commandment which is, I believe, you should never say, "I told you so," but I have told them in this room, repeatedly, that the reason Rocky Mount has the very difficult educational problem we've got right now is because they weren't available to be instrumental in trying to solve this problem years ago. They withdrew.

Now what's happened is, this whole process of solving the problem, the whole basis for it, is economically driven. They now feel threatened economically because the area is not growing the way it should grow. So now their pocketbook is pinching. So they're coming out of the woodwork now. And one of the things about them is they're being discredited by the opposition who says, "Well, now you're a johnny-come-lately here. Your children didn't even go to public school, and you've been supporting this private academy out here all these years. You have no standing to come in now and say how we ought to be solving this public school problem." Well, I'm not subject to that type of discrediting so I can stand up and look them right in the face. My father imbued me with that. He didn't suggest that I do that but he imbued me with that understanding that he had. That a good solid public education system was a part of the democratic fabric, and if you didn't have it, you would have anarchy, and if

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you didn't have it, you sure as hell wouldn't have any economic development if you had a bunch of illiterates running around here.

The difference between where he was in the Pearsall Plan and where we are is that, it was being, North Carolina was being forced to integrate its schools as a result of the Supreme Court dictates. In this instance right here, it is a move based upon enlightened self-interest on the part of the business community that it is not good business to be segregated any more. It is not good business to have separate but equal. It's not good business to have segregated country clubs because it doesn't help develop economically. So one was pushed, the other's being pulled. I think what you're seeing is the second phase of, I mean, we saw an integration of the schools back in the 1950s as a result of the Pearsall Plan and all that. And I'll tell you about, you know, what his philosophies were in a minutes. But I think it is an interesting, this is another stage of it. This is a stage where people are saying, the government isn't telling us we've got to be integrated, we've got to have unitary schools, we're telling ourselves that it's not good business down here not to have an educated public and not to have community unity and a solid unitary integrated school system. So the driving forces behind the two are quite different, and this is one where people are voluntarily coming forward and saying, "Guys, you've got to change it." His was different.

Now, I can remember this. One of the proudest things, or one of the things of which he was proudest, was that North

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Carolina did not have a school closed for a day to a student due to integration efforts such as they had in Virginia. I can remember him commenting on how much that was in and of itself a vindication of the validity of the Pearsall Plan as a pop-off valve. It was misunderstood by many blacks as having been an anti-integration move. I have been accused myself of being a carry-over from that thing. And my father as he lay on his death bed dying of cancer at Duke University, his one desire, the one burden that he wanted to be relied of, was the thought that the black citizens of North Carolina thought that he was a segregationist, that he was anti-black. And if you will go back and check his track record, all these humanitarian things that he did over the years, all the pleasure that he got out of seeing black people become integrated into the economic system, all that was totally inconsistent with it—the absolute polar differences between himself and I. Beverly Lake. Those things are not consistent with Tom Pearsall being a segregationist.

Now, what my mother did, unbeknown to my father as he lay on his death bed at Duke Hospital, was to call Governor Jim Hunt and she said, "Governor Hunt, can you get some responsible member of the black community to go and discuss this with my husband and see if you can relieve his one burden, the one reproach that he did not want to go to the grave with." And the governor sent a guy named Ben somebody from Durham, one of his leading operatives. He went to my father's room at Duke Hospital and they talked that thing out and it was as if my father had had the last burden lifted from his shoulders and could at that point in

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time, you know, go on to whatever was to be without that burden on his back. He worried about that. Oh, I can remember tears coming into his eyes. I can see him in his office right now, worried that that was going to be the image that he had in the black community. And I hope that history, and I think history has treated the plan more fairly and more objectively than to treat it as a George Wallace type of standing in the doorway type of resistance. It was not designed for that at all. It was designed to provide the people of North Carolina with a rational alternative that they could see as a pop-off valve in the event that they needed it. And they never saw fit to use it. Even though it was ruled unconstitutional, it was a tactic that was designed to get North Carolina through a very critical phase, and I think it achieved its objective. And he saw that it achieved his objective and he just wanted to make sure that he didn't die being misconstrued.

[TAPE 1, SIDE B]

WALTER E. CAMPBELL:

Speaking of the Pearsall Plan, do you think that your father and the others perceived it, originally, as a pop-off valve, or was this something that they came to gradually, as they began to worry about the situation? In other words, when they sat down, did they say to one another, "Okay, we need something to hold the line here, and we need to get through this tough period. Let's have something that will do that." Do you think that that's the way they originated with the Plan?

MACK PEARSALL:

Well, I doubt it. I think it was probably something that evolved. I think that they recognized that North Carolina was going to be catapulted into a very tension-filled environment—a major change in lifestyles and folkways and mores. And that somehow or another, responsible elements in this state had to come together and craft some idea that would be consistent with North Carolina's image of moderation. That you could not stand back and allow the rank segregationist to step forward, and that the best defense is a good offense. I think that's the basis on which they went. To say they went in with it as a plan that was conceived to be a pop-off value, I doubt it. I think they recognized that when you've got a head of steam built up that unless you provide some avenue for people to get relief that you've going to have a pop-off. And they watched Virginia. They watched the defiance that went on in other states, and they were very, Governor Hodges and my father, were very concerned about the image that North Carolina portrayed nationally in this whole process. And I think that if we hadn't portrayed the type of

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image that we did, that some of the wonderful things that have happened in this state would never have happened because we would have been branded as a bunch of redneck backwoodsmen. I don't know how it would have affected the Research Triangle and all that. But here you have a governor, Luther Hodges, who was one of the creators of that concept and at the same time he was one of the creators of a concept or summoned in people that he thought could help him develop and craft a way for North Carolina to deal with that very difficult transition period.

WALTER E. CAMPBELL:

How did people in Rocky Mount react to what he was doing? How did his tenant farmers react to what he was doing? Did they know about it? Did he receive any sort of threats or anything? Was it just ignored?

MACK PEARSALL:

No, absolutely, lots of threat mail, threatening phone calls, called a "nigger lover." There was an element that was opposed to integration of any form, stretch, or imagination, they were vehement and very outspoken about it. I don't think that the black community, particularly in terms of the tenant community, really had an appreciation for what was going on. I think they were brought to the party by the federal government and at that point in time, they were new to the political process. They had been disenfranchised and so new to the thought of being integrated into the overall society here, that they just didn't relate to it. And that there were certain leaders that were out there that did and who understood it, but I think perhaps even those, at that point in time, viewed it as a resistance type move.

WALTER E. CAMPBELL:

How much contact did he have with his tenant farmers? Was that handled by other people?

MACK PEARSALL:

Oh, Lord no. He had a lot of interaction with them, not in the disciplinary sense, but he had a lot of interaction with them at the family level. And that's what he used to do. He used to love to go out there and visit in their homes and, you know, just find out how they were doing and see ways that he could help them. He was just, sort of a mentor to them, I reckon. But at that point in time, I don't think they had any great sense of direction and destiny as to what was happening. I think they were being buffeted by the winds of legal circumstance.

WALTER E. CAMPBELL:

Well, was there any type of rivalry between your father and I. Beverly Lake, in the legal sense, within the North Carolina community because they do seem to be at such opposite poles of this situation, and at the time it looked like they may be the two candidates running at some point—I guess that was the early '60s maybe. Was there any old sort of festering rivalry there at all that you know of?

MACK PEARSALL:

Well, I don't know, I mean I think you've got to recognize that at that point in time which proceeded the current two party system that exists in fact in North Carolina, that there were two factions in the Democratic Party. There was a more liberal faction. There was a more conservative faction. They checked and balanced each other and kept them honest. And there was infighting between those two as to whether you were in the Charlie Johnson camp or whether you were in the Kerr Scott

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camp. So there could have been some of those trappings that overhung the whole thing. My observation of hearing him comment on Dr. Lake's position and seeing Dr. Lake's position articulated by himself was that the issue was not one of ego. The issue was a basis one of sociological philosophy, and that my father's commitment to the process was not to better I. Beverly Lake or one-up-manship I. Beverly Lake, but to execute an underlying philosophy that he had about what is sociologically right. And I think that he and Beverly Lake were at absolute opposite ends of the pole on that basis. I can remember how all the things they had to do in the legislature to get the Pearsall Plan through, and things they had to sneak around. And every time they were trying to do something, Tom Ellis and I. Beverly lake were over there trying to sabotage it. Of course, Ed Rankin can give you a lot more of those details, but I heard all that type of business and Tom Ellis and I. Beverly Lake never had any love of my father. The fact is that when my father gave his oral history, I think, or gave some things to the university, gave his papers, he wanted to make sure that they were not released at a point in time when I. Beverly Lake was still on the North Carolina Supreme Court for fear that if we had a case that went to the North Carolina Supreme Court, that it would be that those comments and observations would be used against us. So I mean I think that his view of Beverly Lake was that the two just had incompatible philosophies on how this thing should be dealt with. And he felt that that group over there were fully capable, as I think the Congressional Club clearly demonstrates today with Tom Ellis and

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others, fully capable of mean politics. And he wasn't afraid of mean politics but he just, you know, nobody would invite that type of business.

WALTER E. CAMPBELL:

Well, how did your father feel about the possibility of running for governor, or did y'all ever talk about that? I mean, most reports I saw is that, you know, he really wasn't interested but if called, he would go and that kind of thing. Did you think he had an ambition to be governor?

MACK PEARSALL:

Oh, I think everyone of us has an ego. It's just a question of how well we manage it and, you know, how much it drives us. Most of the politicians that I've run into, become convinced, I mean there's a problem, and they've become convinced that they have a solution to that problem. And they become convinced as they hear themselves talk that probably they have a unique solution to the problem. When they become convinced of the fact that they've got a unique solution to the problem, then they conclude that they are duty bound to offer themselves in candidacy to solve this problem that they only have this unique focus on. I don't think he ever let his ego get in the way. I think what happened to him was he had to make a choice between family and politics. In many instances the two cannot coexist, unless you have a wife who is totally caught up in the political process. And my mother is not caught up in the political process. I sit here and Jimmy Garner and Marie Garner are very close friends of mine, socially, not politically. But I anguish for her as I see her being drawn into the political realm because of his ambitions and his desires to be a part of the governing

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forces of North Carolina. And she has no desire to be a part of it. Now, my mother never had that type of desire to be a part of the system. But I don't think she would have wanted to have held him back. I mean, their relationship was so supportive of each other that she would have sacrificed to do it. I think he found in the 1950s that, this was before the Pearsall Plan, before he was called back into harness, so to speak, that it was a big price to pay in terms of the cost to your family and his family was at a rather young age at that point in time and he had some business interests that he wanted to pursue, and he just was not, he didn't have enough ego to cause him to want to forfeit those things. I think he had a burning sense of mission to get in there and do things that would have made North Carolina, that would have continued North Carolina on its track to being a great state and a moderate state, and I think that he would have been a governor that would have had a strong empathy for the minorities and their disadvantaged position. He would have had a strong empathy for economic development as a way to help solve those problems. But he told me when I came back out of law school and Hugh Morton asked me to run his gubernatorial campaign, he said, "Well, I'll tell you what son," he said, "I wouldn't work that hard unless I was the candidate." I said, "Ah, it can't possibly be that way." So I didn't take his advice, and I found out very quickly that it is a hellacious undertaking and it is an undertaking that is a tremendous grind. I suppose that being around politics myself, having had Edmund Gill and what's his name, oh, I'm trying to think, Hathaway Cross come into our homes

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on Sunday afternoons and all that kind of business, that I grew up with politics being talked at the table all the time. And then I saw the demands that it made on his time and where he was, and then I had my own personal stint with it where I put my hand on the stove and got burned by it, in the sense of knowing what it takes away from the time. And if you don't just particularly like that area, then you don't go do it. So it convinced me that that wasn't the career that I wanted to follow. And I think that he reached somewhat the same conclusion, the choice between family and politics.

WALTER E. CAMPBELL:

Speaking of family, how did your mother and father work out things with the Pearsall Plan? Was she, did she have the same sort of racial outlook, the same sort of liberal approach, if you will, as he did? Did she try to hold him back? Was she less liberal than he was?

MACK PEARSALL:

No, she's a very enlightened woman. In fact, I've only really gotten to know her after his death because I always knew her as a mother up until that point in time. Beyond that point in time I have known her as a mentor and a friend, as a very intelligent, enlightened lady. No, definitely not. She supported him philosophically through out the whole process, and she would be the person to whom he would return after the abusive phone calls and the harangues and all the stress that goes on when you're fighting a very divisive issue. And I think she would embolden him to go back out and pick the challenge up again. Because she too has a great sense of fair play and what's right.

WALTER E. CAMPBELL:

Did she suffer socially at all? I mean, was she ostracized any? She didn't receive threatening phone calls, did she?

MACK PEARSALL:

I'm sure they received them at home. But I was away at law school. I was away in school a good part of that time so I don't really know all the details of it. I'm sure there were those who ostracized her, and those who hold it against her today. But she's such a lady and she's so confident in her own convictions and so content with her philosophies in life that she's not dissuaded to do one thing or the other. She's not influenced by that type thing. She knows what she considers to be right, and she's comfortable in pursuing it regardless of what others think. Everybody's entitled to their opinion.

WALTER E. CAMPBELL:

Well, how about ourself, did you feel any effects from it, the Pearsall Plan and the changes, while you were at school? I mean, did anybody accost you or threaten you in anyway? Or did fellow students look at it as this is the right thing to do, or your father is doing the wrong thing?

MACK PEARSALL:

I don't really remember many instances of it. I remember that, you know, I took a course in North Carolina history under Hugh Lefler, and I think, the way he treated it within his course was a rather delicate situation for me because I was sitting in the course, you know, and he was discussing the plan and challenging it and all that. Not opposing it but causing, as any good professor would, to challenge the thought of it. And that generated some conversation on the part of other students but I suppose the greatest thing that I got out of it

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was a sense of embarrassment in having been singled out, you know, because it was my father. And at that time he happened to be on the executive committee at the university and all that kind of stuff, so that I kind of lost my anonymity and became part of the overall living history. And at that age you don't necessarily want to be that. You want to be a part of the group. But I never suffered from it. I have had, in the last two years in trying to solve this school issue here, I've had some blacks, you know, accuse me of being anti-black because of the Pearsall Plan. And I have without any shrinking at all, told them that I would be glad to debate it in a public forum any time they wanted to. If that was their conviction, they were erroneous. But I think that comes more from people who don't understand it than it does from people who really have an appreciation for what purpose it served in the state.

WALTER E. CAMPBELL:

Well, what do you think made your father so worried about future perceptions of what he was doing? Were there books published? Were there accusations made? What set him off to worry so much? It seems like from what you described that it did worry him right up until the time of his death, about how this would be perceived?

MACK PEARSALL:

Yeah, it was the one single worry about how history would treat it. I think there had been enough verbalization within the black community where he thought that that was the general perception. And I'm not sure that it was the general perception. I'm not sure there was any perception there but at least, he perceived that they thought, that some responsible

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black leaders in the state, still thought that it was an obstructionist type of move. And he did not want to go down in history with that mantle because he had spent so long, in other aspects of his life, in matters that were totally inconsistent with that.

WALTER E. CAMPBELL:

So there was no one thing that you know of then that really might have hurt him, in a way, in bringing out the incorrect perceptions as he saw it. It was just a building up over time and as things changed, more and more came out. We became more liberal as a society in general, and thereby, some sort of measures like this might have looked as some sort of obstructionist. Was it just a general atmosphere maybe that made him worry more?

MACK PEARSALL:

No, I don't think, I think that probably what happened, I mean, the things that stuck in his mind were things that occurred close in point of time when the plan was introduced, when it was clearly misunderstood by the black community as being a segregationist, obstructionist approach. And I think the older you get and the more you begin to realize your own mortality, that those things that worry you tend to cycle up more frequently. And I think that that's what brought it up. I don't think there were any latter day reinforcements of it. I think he had never been able to disabuse his mind of some of the very caustic remarks that had been made back at that point in time. And they had been very stinging to him because he considered himself to be a humanitarian, and those things were so inconsistent with that, he just couldn't reconcile in his own

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mind that he could be that misperceived. And he wasn't worried about his place in history in the sense of ego, he was worried that there was such an inconsistency between the life he tried to live and had lived in every other fashion and had manifested in every other way, versus what had come out as the blacks perceived it back at the time it was crafted.

WALTER E. CAMPBELL:

Well, do you think the Pearsall Plan would have been seen by your father as one of the high points as his life, as one of the major contributions he had made to North Carolina history?

MACK PEARSALL:

Yeah, I would say that there were two things that I think he would, well now, of course, he had a lot of things that he was involved in and when he was involved agriculturally, I think he saw a lot of things, did a lot of things that maybe were influential. But if I was going to go back and look at the things that I, and he didn't speak a lot about the Pearsall Plan, but I knew that it was significant and I think history has treated it as being significant, but he was not a man to talk about what he had done. I think the two things that he would be most proud of, in terms of influencing the direction that North Carolina has taken for the better, would be his involvement in the reorganization of the higher university system into the sixteen campus system—that was patterned after California when he and Bill Friday and a group went out there and came back—and then the Pearsall Plan. I think those two things have, potentially have, had in his mind, the most lasting effects for,

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in his own statement, "making a difference in life."

WALTER E. CAMPBELL:

Well, I think on that note, we'll end it.