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CHAPTER TWO

Development of Organized Crime

in the United States

Abadinsky, Organized Crime 10th ed.

Murder, Inc. represented the apex of organized crime in the United States, when the major chieftains financed a unit of assassins who, although operating out of Brooklyn, NY, carried out murders throughout the country. The history leading up to this development will be discussed in Chapter Two.

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The intertwining of urban machine politics and Prohibition provided Irish, Jewish, and Italian immigrants unparalleled criminal opportunity to climb the "queer ladder of social mobility." But it was the Robber Barons who helped enrich the fertile soil necessary for the growth of organized crime in the United States and whose spiritual legacy lives on in twenty-first-century corporate crime.

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THE ROBBER BARONS: UNSCRUPULOUS AMERICAN BUSINESSMEN

19th century uncontrolled capitalism provided role models and created a climate conducive to the growth of organized crime.

 John Jacob Astor (1763-1848)

 Cornelius Vanderbilt (1794-1877)

 Daniel Drew (1797-1879)

 James Fisk (1834-1872)

 Jay Gould (1836-1892)

 Leland Stanford (1824-1884)

 John D. Rockefeller (1839-1937)

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The 3 members of the Erie Ring

WHO WERE THEY?

 They had English, Scottish, Scandinavian, or German Ancestry.

 They were able to use government force for personal gain.

 Astor: cheated Indian traders and his own employees, and invested his gains in slum housing.

 Vanderbilt: monopolist and Civil War profiteer.

 Erie Ring: used stock fraud and corrupt judge to fight Vanderbilt monopoly.

 Stanford: corrupt governor and briber of Congress.

 Rockefeller: oil and railroad monopolist.

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WHAT ARE WE TO CONCLUDE FROM OUR GLIMPSE OF THE ROBBER BARONS?

 They used violence to achieve private ends: figurative violence (financial piracy) and literal violence (thugs, police, military).

 They used government force and corruption to achieve private ends.

 Their predatory acts led to the enactment of the Sherman Anti- Trust Act in 1890 (discussed in Chapter 14).

 The western frontier closed, the wealth of the Robber Barons became institutionalized, and their progeny controlled the economy.

 What opportunity was there for the new immigrants, the poor and ambitious residents of our cities?

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IMMIGRATION AND URBAN POLITICS

 Later immigrants--Irish, Jewish, Italian--innovated in a manner consistent with available opportunity.

 In the latter half of the 19th century, they found opportunity in the vice and politics of urban America.

 Political bosses emerged to channel their votes into a powerful entity known as the "machine."

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THE IMMIGRANTS

 1820-1850: population of cities in the East and West quadrupled.

 Forced into slum housing reserved for their ethnic group.

 Worked in dangerous, monotonous, low pay industries.

 Their culture, customs, and beliefs were virulently attacked.

 He had one commodity some natives coveted: his vote.

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ORGANIZED CRIME IN AMERICA: A 100+ YEAR EVOLUTIONARY PROCESS

 Immigrants looked to politics for concrete and personal gain and sought these through personal relationships.

 Political bosses understood immigrants' perspectives and could also manipulate the American environment.

 The roots of organized crime are found in the politics of urban American before Prohibition.

 The Irish fled English oppression and the famine (1845-47), arriving in America a close-knit, politically sophisticated society, whose members were experts in non-confrontational warfare. They could make alliances without formal conferences, agreements, or treaties that would leave a record.

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IRISH

 Politics enveloped the Irish, and the Irish social structure became an integral part of the process of recruiting more Irishmen into the Democratic Party and government.

 Political office was the desired career, and politics became a secular extension of their Catholic identity.

 Highly social, gregarious above everything.

 Ability to speak English was another advantage.

 Neutral outsiders to hostilities between Central and East European immigrants who would vote for an Irish candidate.

 Saloon: as important as the parish church in the social structure.

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THE SALOON AND THE MACHINE

 The saloon was a center of activity in urban America. It provided social services, newspapers in several languages, cigars, mailboxes for regular patrons, free pencils, paper, and mail services for those wishing to send letters, and information on employment.

 Saloons provided a warm fire in winter, public toilets, bowling alleys, billiard tables, music, singing, dancing, conversation, charity and charge accounts, quiet corners for students, and special rooms for weddings, union meetings, and celebrations.

 City government was fragmented and dispersed. The city was divided into wards which were both electoral and administrative units, containing relatively small numbers of people.

 Saloonkeepers became political powers.  Saloonkeepers were in a position to influence their customers' votes. They

could deliver their precincts and control the wards.

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THE MACHINE POLITICIAN

 The machine politician was a popular figure. In the days before social welfare programs, he provided important services to loyal constituents-- jobs, food, and assistance dealing with pubic agencies, including the police and the courts.

 All he asked for in return were votes and a free hand to become wealthy in politics.

 A narrative: "When he hung up the phone, Alderman Charley looked at me with sadness and said, 'That woman's got a dead rat in the alley behind her house and she don't call no Republican to take care of it, she calls the alderman.' So what are you going to do, Charley? 'What can I do? I got to go over there and pick up her rat and find a good garbage can with a top on it and, well take care of it. This woman will be peekin' out her window and see the alderman drive up in his Cadillac and get out and pick up her dead rat and drive away with it. She'll tell everybody.'"

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THE SENSE OF THE MACHINE

 The political machine does not regard the electorate as an amorphous, undifferentiated mass of voters.

 "With keen sociological intuition, the machine recognizes that the voter is a person living in a specific neighborhood, with specific personal problems and personal wants" (R. Merton 1967).

 The very personal nature of the machine was noted in 1931: "In the midst of the depression, an Irish alderman distributed unleavened bread (matzah) to hundreds of Jewish families in his district, so they might keep Passover. This will not cost him any votes" (McConaughy 1931).

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UPPERWORLD AND UNDERWORLD

 The machine leader kept his district organized. He was a broker in a key position to perform services for captains of industry and captains of vice.

 The machine could deliver franchises, access to underdeveloped land sites, government contracts, tax abatements, and other special considerations.

 Once entrenched, the Irish machine bosses quickly built alliances with older-stock business interests.

 The political machine organized urban immigrants into a political force through which it dominated the government.

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CHICAGO AND NEW YORK

 Chicago, Kansas City, NY, Philadelphia, St. Louis: The rough and tumble city bosses allowed the private utilities and favor-seeking men of wealth as well as the purveyors of vice to exploit the citizens.

 Chicago business interests promoted corrupt and inefficient government.  "The deal is that the underworld shall have a 'wide open town' and its upperworld

allies shall be permitted to plunder the public treasury" (Dobyns 1932).

 In NY, "in each district of the city, saloon keepers, owners of houses of prostitution, grocers who wanted to obstruct sidewalks, builders who wanted to violate the building regulations of the City, paid tribute at election time to district leaders, who turned the money over to the general campaign fund of Tammany Hall" (Werner 1928).

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REFORM AND NATIVISM

 Corruption-reform-corruption-reform hypocrisy.

 Reformers were often part of the rampant nativism that intertwined with social Darwinism.

 Investigations were initiated by Protestant Republican interests against urban, Catholic and Jewish Democrats.

 Nativism helped tie immigrants to the political machine.

 The machine politician cultivated the immigrant's ethnic pride by defending him against nativist attack, observing his customs, and concerning himself with conditions in the homeland.

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PROHIBITION

 The acrimony between rural and urban America, between Protestants and Catholics, between Republicans and (non- southern) Democrats, between "native" Americans and more recent immigrants, and between business and labor reached a pinnacle with the ratification of the 18th Amendment in 1919.

 Prohibition agents were inept, corrupt, and a public menace.

 Every year until Prohibition ended, the murder rate in Chicago rose, going from 6.8 er 100,000 in 1920 to 9.7 in 1933.

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ORGANIZED CRIME

 Until Prohibition, gangsters were merely errand boys for the politicians and the gamblers.

 They were at the bottom of a highly stratified social milieu.

 Prohibition changed the relationships among politicians, vice entrepreneurs, and gang leaders.

 Before 1920, the political boss acted as patron for the vice entrepreneurs and gangs.

 Prohibition unleashed extreme violence, a gang specialty.

 Physical protection from rival organization and armed robbers was suddenly more important than protection from police. Prohibition turned gangs into empires.

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MURDER, INC.

 Just before the end of Prohibition in 1933, gang leaders began meeting throughout the US in anticipation of the new era.

 In 1934, the major leaders of organized crime in the East gathered at a NY hotel with Johnny Torrio presiding. They came to an understanding:

 "Each boss is czar in his own territory; no one can be killed in his territory without his approval."

 The new organized crime syndicate had their own staff killers, the "Boys from Brooklyn." Gang leaders across the country used their services, murdering about 1,000 persons nationally.

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KEFAUVER CRIME COMMITTEE

 1950: Senator Kefauver(TN) recognized the importance of organized crime as a national political issue. (Memphis "Boss" Crump had vigorously opposed his election to the Senate.)

 Kefauver chaired the Special Committee to Investigate Organized Crime in Interstate Commerce, the first major Congressional investigation into organized crime.

 The committee heard more than 600 witnesses in 14 cities, and concluded that the Mafia is “the shadowy international organization that lurks behind much of America’s organized criminal activity."

 The committee also tied organized crime and the Mafia inextricably, wrongly equating Italians with organized crime.

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