Galbraith concluded that 'a Bentsen victory will tighten the hold of conservatives on the Texas Democratic Party, force the rest of us to contend with them nationally and leave the state with the worst of all choices - a choice between two conservative parties'.
The letter was written during a particularly bitter Senate election. But Galbraith was correct in seeing Bentsen's victory in the 1970 Senate race as a sign that the Democratic Party was shifting to the right.
Twenty-two years later, Bentsen's appointment last Thursday as Treasury Secretary appeared to underline how little change can be expected from a Clinton administration. It was greeted with appropriate joy on ever-conservative Wall Street.
Bentsen is in favour of tax breaks for big business in the real estate and oil and gas sectors. He wants tax advantages for wealthy individuals. With reservations, he is a supporter of the North American Free Trade Agreement. He has also made protectionist noises about Japanese imports, although - comfortingly for exporters to the US - the Treasury Secretary is not directly involved in trade issues.
Despite his conservatism, however, Wall Street may have rejoiced too soon. Bill Clinton has drawn his economic team from those he thinks most capable of getting legislation through Congress and implementing it. The devising of policies will remain within the White House, under Clinton's own control.
The inner circle of advisers announced last week includes Roger Altman, a Wall Street investment banker, as Bentsen's deputy, and Leon Panetta, chairman of the House Budget Committee, who takes over as director of the Office of Management and Budget. Bob Rubin, co-chairman of Goldman Sachs, will take up the newly created post of economic counsellor to the President inside the White House. Not all are as conservative as the new Treasury Secretary. But it is Bentsen himself who remains Clinton's best insurance against reforms frightening the markets.
He should also provide a reassuring presence well beyond Wall Street. If nothing else, the 71-year-old silver- haired Bentsen, Hollywood's idea of the courtly Southern gentleman, looks the part. He achieved lasting fame when, in an unusual flash of wit, he delivered a memorably crushing put- down to Dan Quayle during the 1988 presidential election campaign.
During a televised debate, Quayle rashly compared himself to Jack Kennedy. 'Senator,' responded Bentsen, 'I knew Jack Kennedy. Jack Kennedy was a friend of mine. Senator, you're no Jack Kennedy.' The impact was not reduced by the subsequent revelation that Bentsen's acquaintance with Kennedy was minimal.
As Treasury Secretary, Bentsen has the distinct advantage, from Clinton's point of view, of being a close friend of Alan Greenspan, chairman of the Federal Reserve, whose term of office does not run out until 1996.
But there are deeper reasons why Clinton should like Bentsen. Both are Southern Democrats, now the predominant faction of the party. The lesson of the seven presidential elections since 1964 is that only a Democrat from the South stands a chance of being elected to the White House. The 'new kind of Democrat' whom Clinton claims to represent is one who holds the views, economically progressive and socially conservative, acceptable to Southern voters.
Both Clinton and Bentsen are, above all else, professional politicians comfortable in the company of other politicians. In 1988, when Bentsen was the Democrats' vice-presidential candidate, it was noticeable how much happier he looked campaigning than Michael Dukakis, the presidential candidate, who was an anti-politician. In 1992 Clinton was enthusiastic about the endless speeches and meetings in a way George Bush never was.
Neither man makes many mistakes, but the Republican gibe that Clinton is slippery is equally applicable to Bentsen, though in the Texas senator it is better concealed by age and gravitas. In 1988 it was revealed that Bentsen had been charging lobbyists pounds 10,000 a head in campaign contributions merely for the privilege of having breakfast with him.
In background they have little in common. Clinton's mother really was poor. But Bentsen's father, who moved from the Dakotas to Lower Rio Grande Valley in 1921 with dollars 5 in his pocket, rapidly made himself one of the largest Texas landowners.
Lloyd was born the year his father arrived in Texas, growing up in a bungalow on a back road, where he spoke Spanish as easily as English. After serving as a bomber pilot in the Second World War, he practiced briefly as a lawyer and a judge before being elected to Congress at the age of 27 in 1948. Much later in his career, his campaign literature showed the silhouette of the B24 bomber he piloted - a straight steal from John Kennedy's showing the silhouette of his wartime torpedo boat.
In 1954, he retired to go into business on his own account, financed by a dollars 7m loan from his father with which he started an insurance company. He came back into politics 16 years later in 1970 with the encouragement of John Connally, the conservative Texas Democrat, to stand against the liberal Democratic senator Ralph Yarborough, who opposed the war in Vietnam. Relying on conservative Democratic money and advertisements on television showing the riots outside the Democratic convention in Chicago in 1968, Bentsen enraged the liberals by defeating Yarborough in the primary.
He then faced Bush in the election and won, despite the Galbraith letter, with black and labour endorsement.
Over the next 22 years Bentsen built up an effective organisation in every one of the state's 254 counties. In 1982 and 1988 he was returned with 60 per cent of the vote. Yet even when Bentsen was Democratic vice-presidential candidate in 1988, Texas voted Republican in that election year. With his departure from the Senate, the Democrats may well lose his seat.
His reputation as a legislator increased with the number of measures he brought forward in the Eighties, although many never made it on to the statute book. Since 1986 he has been chairman of the influential Senate Finance Committee, which lies at the heart of congressional power over the economy. Last week he was described by one of his colleagues as having 'an absolute familiarity with all the issues on the table. He has an institutional memory for all the economic decisions, good and bad, in the last generation.'
This could also have been said of other Democratic senators. But Bentsen has drawn high praise from even the most sceptical Washington observers. The authors of the Almanac of American Politics, the bible of US political observers, said this year: 'Bentsen continues to be one of the few American politicians who is plainly a presidential possibility. In breadth of experience, in depth of knowledge, in traits of character - a steely self-confidence and the capacity to rebound after setbacks - he is far and away the superior of most who have run for the office in the last dozen years.'
The truth of this became evident in 1988 when, as Dukakis stumbled into defeat, Democrats began to murmur that with Bentsen leading the ticket they might have won.
He was also noticeably combative, somewhat dissipating his reputation as a courtly reactionary. Asked about the Republican claim to have produced a strong economy, he said: 'If you let me write dollars 200bn in hot cheques every year, I'd give you an illusion of prosperity too.' Unlike Dukakis, Bentsen wrote most of his own speeches, attacking Bush's campaign for containing 'elements of racism' and focusing on industrial decline and the maldistribution of wealth.
He even resigned from two Houston clubs at the start of the campaign, on the grounds they discriminated against blacks. Once the election was over, however, he rejoined them.
Bentsen's surprising success in 1988 might have been the basis for a renewed bid for the presidency in 1992. But, like most Democratic heavyweights, Bentsen appears to have over- estimated Bush's strength in the wake of the Gulf war.
With the appointment of Bentsen and other congressional barons, commentators are beginning to speak of Clinton opting for a form of parliamentary government, co-opting legislators into the executive. The difference is, of course, that Bentsen and other congressional leaders will lose their seats, and it is not clear how durable the influence of Bentsen over the Senate and Leon Panetta over the House of Representatives will prove to be.
Nevertheless, the appointment of Bentsen is an astute move by Clinton, strengthening his administration from inauguration day. The Clinton economic programme was never very radical, but with such a reassuring presence in the Treasury, the markets are less likely to be frightened.
But Galbraith's criticisms of almost a quarter of a century ago retain their force. Whatever the tactical advantages of giving Lloyd Bentsen the Treasury, it reinforces the conservative cast of mind of the new administration. The economic figures are improving, but growth is not producing jobs and higher wages in the way it once did.
Bentsen may be fully capable of implementing Clinton's economic plans as outlined during the campaign, but these will be scarcely adequate to produce the changes that Clinton says he wants to see.