American gangsters, part 2: conditions

American gangsters, part 2

(In this section of the essay, I shall attempt to define organised crime, and describe what conditions allow it to flourish)

Organised crime is an operation to make money. It is thus different from the aimless violence of street-level hooliganism. Almost all successful gangsters began as juvenile delinquents, with petty thefts and muggings, battles over territory and punch-ups in dance-halls, but then moved on to something much larger-scale. A top gangster in a capitalist entrepreneur who uses methods abnormal in a law-abiding society. Bertrand Russell once pointed out that free-market capitalism as we understand it is actually heavily circumscribed in its activities: you are allowed to bankrupt your competitor by undercutting his prices, but you aren't allowed to shoot him. The Mafia, if you like, doesn't recognise this last restriction! But for a serious criminal, the violence is only incidental to the main activity, which is moneymaking.

There are various ways the criminal can make money; the simplest being theft. But theft is not only heavily punished by law, it is also unpopular in the community. If thieves wish to stay in business, they must be careful only to rob outsiders, or those perceived as the enemy. In primitive societies, where almost all people are poverty-stricken peasants, becoming a bandit is almost a rational career-choice, and bandits may even acquire romantic and heroic status (the Robin Hood image). But in reality, they are unlikely to stay in business for long.

Slightly more sophisticated is extortion, going under the names of blackmail, "protection", or "rackets": demanding money for alleged services with the threat of violence for non-payment. (The word "blackmail" is actually Scottish in origin, meaning the "black" (illegal) "mail" (tax) which Lowland farmers had to pay to the Highland clans to preserve their cattle from being raided) Rackets depend on the state authorities being too weak to enforce the law, usually because the victims do not inform the police. They work best where the businesses under threat are themselves are not legal: dealers in smuggled goods or banned substances, or such typical slum operations as brothels, unlicensed moneylending, drinking and gambling dens. Such businesses may escape the attentions of policemen, or simply bribe them to look away, but they can hardly avoid the demands of local thugs out for a quick buck. Even legitimate concerns in the ghetto may not escape, because their businesses are usually precarious, and the whole ethos of the ghetto is to see the police as an enemy, not to be trusted. The only way to escape the attentions of the extortionists is to be stronger yourself: to have patrons powerful enough to scare off the thugs, or to hire your own thugs in self-defence. An intelligent hoodlum could easily double his career as a strong-arm man: demanding protection money on the one hand, or fighting off the racketeers for a reward; or indeed both. Many top gangsters began their careers this way. The overall effect of rackets is of course to raise prices for the consumer, to cover the cost of paying off the gangsters. In some ways the extortionist is thus comparable to the role played by the capitalist in simplified forms of Marxist doctrine: someone who skims money off the top of the operation without contributing anything useful to it.

The best method of making money is buying and selling; crime as trade: dealing in contraband or illegal commodities. Smuggling was the earliest form of this, and still persists. The best goods to trade are things that people want to buy, but are illegal; or better still, on the borderline - illegal without necessarily being seen as morally wrong. Examples would be pornography, prostitution, gambling, drugs, illegal immigration, and in 1920s America, alcohol. There are several advantages here for the criminal. Firstly, it avoids the obloquy attached to robbery or protection rackets. Secondly, it drags within the criminal orbit people not normally associated with crime (the consumers) who will have nothing to gain by driving their supplier out of business by having him prosecuted, and may indeed be a fruitful target for blackmail. It all presents a conundrum for Free Trade theory: if person X wants to sell an item to person Z, who is willing to buy if the price is right, what justification does the state have for intervening to prevent the deal? There will be certain inevitable results of intervention: the price will fluctuate wildly, all possibility of quality control will be lost, and sooner or later the trade will fall under the control of the men of violence. The reasons for this are plain. Criminals have their overheads too, but also tend to destroy a free market by using violence to put competitors out of business. Supplies can seldom be guaranteed. Neither side has the normal legal safeguards against being swindled: if the purchaser is sold inferior goods or the vendor does not receive payment, the defrauded party cannot bring the defaulter to court; all he can do is threaten violent retribution. The vendor may evade the attentions of the police, but his only defence against the violent extortionist is to command greater violence himself. Trade in illegal substances always ultimately puts money into the pockets of the men of violence. (My personal view is that almost anything is preferable to this outcome)

Before organised crime can really take off, certain social and poltical conditions are needed. The most important is that there should be a population who see the police as the enemy. This condition is found amongst minority groups subjected to racial or religious discrimination, are confined to ghettoes, can't get decent jobs, and view the forces of law and order as instruments of oppression. The American cities of the early 20th century, with their teeming immigrant communities, were like this. The Lower East Side of Manhattan was said to be the most densely inhabited area on the planet. But why did the early gangsters tend to be Irish, and the later ones Sicilians or Jews from the Russian Empire, rather than, say, Germans or Swedes? The answer surely is that the Irish, Sicilians and Jews came from homelands that regarded themselves as living under foreign occupation, with the police seen as alien oppressors rather than as protectors of citizens' rights. Even law-abiding ghetto inhabitants might identify with the gangsters rather than with the police. Crime is the normal state of ghetto society. Often the police may prefer simply to leave the ghetto alone. Furthermore, for an able and ambitious ghetto youngster, facing an impenetrable wall of poverty and discrimination, crime may be the only way to make money. Traditionally, in a society without a proper system of free education to enable social mobility for those with talent, the only routes out of the slum were music and professional sport. But there can be a third route: organised crime.

The other main condition for successful organised crime is the existence of a corrupt political system, where the men in power prefer to take bribes from the gangsters rather than fighting them. Indeed, without such venality, extending from officialdom down to the rank and file policeman, no criminal can last very long. The American cities at the turn of the century were extremely corrupt. They were of very recent growth, without any traditions of disinterested public service, amd officials used their positions to acquire great wealth; for instance by taking backhanders on public building contracts. (It is characteristic of primitive societies that the quickest way to become rich is to get into government and then divert public money into your own pocket: in England it only became unacceptable in the 19th century) So in Chicago Capone estimated that payoffs to police and politicians ran at $30 million a year; police captain Michael Ryan was dubbed "the world's richest policeman" through his bribes, and when Mayor "Big Bill" Thomson died his house was found to contain $1.3/4 million in used banknotes. At ward level, Chicago politics was run by sordid characters like "Bathhouse John" Coughlin and Alderman "Hinky Dink" Kenna: they took a cut from all the brothels and gaming-houses in their districts and gave political protection to the gangsters, who in return would help to keep their political allies in office by organising the immigrant vote (often fraudulently) and intimidating opponents, even to the level of firebombing their offices. The 1928 Chicago campaign saw so many firebombs thrown that it was nicknamed the "Pineapple Primary"! Judge Lyle in his memoirs wrote of Chicago politics, "Each ward committee-man of the ruling party was a dictator in his own district, able to remove unco-operative police chiefs". A serious defect of the American federal structure was that the central government had very little power to intervene to prevent local corruption. County sheriffs, and local judges like Lyle, were elected, not centrally appointed; which sounds democratic, but which in practice made them mere hirelings of the party machines.

Dion O'Banion, founder of the North Side gang, was an influential figure in Chicago politics. The saying went, "Who carries 42nd and 43rd wards? Dion O'Banion, in his pistol pocket". In 1924, shortly before he was shot, O'Banion was given a dinner by the Chicago Democratic party, attended by the County Clerk, a nominee for the Senate, the candidate for Mayor, and deputy police chief Hughes, who explained to the press that when he recognised some of the notorious hoodlums present at the dinner, he left "almost immediately". O'Banion was presented with a platinum watch for his services to the party - but then switched to the Republicans anyway!

The gangsters frequently escaped justice not because they intimidated witnesses, or even because, having plenty of money, they were able to hire the very best lawyers who could run rings round the prosecution, but because they had important contacts with top police and politicians, who could pull strings on their behalf. In Chicago the links were very close. Al Capone was a deputy sherrif, and his chief bodyguard Philip D'Andrea a county court bailiff! And what are we to make of "Big Tim" Murphy, who ran the Gasworkers' Union and the Building Trades Council, served a term in the State legislature as well as a term in the penitentiary for robbery, and coined the phrase, "Take him for a ride!"? He was eventually murdered in 1928. If all else failed, the Illinois State Governor, Lester Small, could often be relied on to issue pardons for notorious gangsters.

Sometimes things got very grotesque. In June 1925 two professional gunmen, John Scalise and Albert Anselmi (the killers of O'Banion the year before) shot down two policemen in broad daylight on a Chicago street. Their lawyer successfully argued that it was a matter of self-defence, since the police were attempting an illegal arrest, and they were convicted of manslaughter only. They were released on bail in 1926, and their conviction overturned a year later. It comes as a relief to learn that they were both murdered by Capone in May 1929.

Capone could not have flourished without Big Bill Thomson as Mayor of Chicago. In general it can be said that corrupt politicians always steal more than criminals, just as soldiers kill far more people than do terrorists.

The third factor in helping the rise of organised crime wasthe state of labour relations. It was law of the jungle, especially in the New York clothing business; an industry with cut-throat competition and starvation wages for immigrant workers. In strikes, employers would hire thugs to beat up picket lines, and trades unions would hire other thugs to beat up blacklegs. This kind of activity, where the favoured weapon was a lead pipe wrapped in newspaper, was known as "schlamming", and could provide even the stupidest thug with a living. These low-level hoodlums were known as "goons" (Spike Milligan learnt the word from American soldiers during the war, and thought it had comic possibilities). From here it was an easy progression for ambitious gangsters to take over the unions and extort money from employers under threat of strikes. The leading lights in New York were Jake "Gurrah" Shapiro and Louis Buchalter, "Lepke the Leopard", working in partnership. By 1927 they had control of the Amalgamated Clothing Workers' Union, and then moved in on the Furriers and the Bakers. A Mafia hitman, Albert Anastasia, "The Mad Hatter" was powerful in the New York docks, and a psychopathic killer, Arthur Flegenheimer, better known as "Dutch Schultz", controlled both the Waiters' Union and the Restaurant Proprietors' Association, through which he tried to dominate the New York catering trade by operating a two-way "closed shop". A little later, Willy Bioff put the squeeze on Hollywood by his control of the Scenery Erectors' Union. The main impact of all this extortion on the general public was, of course, to raise prices.

By the First World War, the foundations for large-scale organised crime were already in place. The typical future gangster was a Sicilian or a Russian Jew, born around the turn of the century, perhaps American by birth, perhaps having entered the country as a small child. He would be brought up in a slum in a big city, where he would see his parents, who perhaps never learnt to speak English properly, earn pitiful wages by sweated labour. Such submissiveness was not for him: he grew up in the turbulent violence of the streets, knew that the police and the politicians were corrupt, that official morality was a sham, and that only money and power really mattered. By his late teens he would already have a string of convictions for minor offences, but also a reputation for toughness and cunning in the seamy underworld of drinking dens, brothels and labour goonery. All he needed was an opportunity to make it really big.

And then came Prohibition!

(This essay will be continued later)