Capone: The Life and World of Al Capone (41 page)

But Capone's most profitable alternative to bootlegging was racketeering.

A "racketeer" [as the Chicago Journal of Commerce described him in its issue of December 17, 1927] may be the boss of a supposedly legitimate business association; he may be a labor union organizer; he may pretend to be one, or the other, or both; or he may be just a journeyman thug.

Whether he is a gunman who has imposed himself upon some union as its leader, or whether he is a business association organizer, his methods are the same; by throwing a few bricks into a few windows, an incidental and perhaps accidental murder, he succeeds in organizing a group of small businessmen into what he calls a protective association. He then proceeds to collect what fees and dues he likes, to impose what fines suit him, regulates prices and hours of work, and in various ways undertakes to boss the outfit to his own profit.

Any merchant who doesn't come in or who comes in and doesn't stay in and continue to pay tribute, is bombed, slugged or otherwise intimidated.

Chicago racketeering involved most consumer goods and services with a consequent rise in prices. The Employers' Association of Chicago estimated the annual cost to consumers at $136,000,000 or about $45 per inhabitant. For example, until Maxie Eisen terrorized 380 West Side kosher butcher shops into joining his Master Jewish Butchers' Association their customers paid 90 to 95 cents per pound for corned beef. To raise the protection money Eisen demanded, the butchers had to increase the price to $1.25.

Concerning Eisen's depredations in the fish market, a victim named David Walkoff mustered the courage to tell the state's attorney's office: "In 1925 Eisen came to a store I had on Taylor Street. He had four sluggers with him. He made me close my store because it was within four blocks of another association store. A month later he told me I could return to the fish business by buying an association store at 1016 South Pauline Street. I paid the store owner and had to pay Eisen $300 to return to the association. Two years later I sold the store for $650 and had to pay Eisen 10 per cent commission. I have bought and sold two other stores since then. Each time I bought it was $300 to Eisen for the association and each time I sold it was 10 per cent to Eisen for the commission." Another courageous victim, Mrs. Mamie Oberlander, a fifty-two-year-old widow with five children, complained to the Chicago Crime Commission: "I went to Eisen and pleaded with him to let me open a fish store and he agreed on condition that I gave him $300. I have no money as I am a poor woman. I threatened to tell my trouble to some public officials, but this brought a hearty laugh from Eisen. He said he is the boss and is not afraid of any official or anybody in the city or county, that nobody can make him do what he doesn't want to do."

So prevalent did the rackets become that a special Rackets Court was established with jurisdiction over the following frequently committed offenses: destruction of property and injury of persons by explosives (in 1928 racketeering hoodlums exploded approximately fifty bombs) ; making or selling explosives, throwing stench bombs, malicious mischief to houses, collecting penalty payments; entering premises to intimidate, kidnapping for ransom, mayhem, intimidation of workmen.

During the twenties more than 200 different rackets flourished in Chicago under such brimming titles as the Concrete Road, Concrete Block, Sewer and Water Pipe Makers' and Layers' Union, Local No. 381; the Soda Dispensers and Table Girl Brotherhood; the Bread, Cracker, Yeast and Pie Wagon Drivers' Union. The 10,000 members of the Midwest Garage Owners' Association each paid its organizer, David Albin, alias Cockeye Mulligan, $1 a month for every car handled. In one month Albin's bully boys slashed 50,000 tires on cars belonging to the customers of nonassociation garages.

Simon J. Gorman, a veteran of Ragen's Colts, who started his racketeering career as business agent of the Cook County Horseshoers' Union, became the czar of Chicago's laundry rackets. With his partner, Johnnie Hand, he organized the Chicago Wet and Dry Laundry Owners' Association, which netted them $1,000 a week. Gorman had powerful City Hall connections, and he used them to discipline holdouts. At his behest a safety inspector would visit the recalcitrant laundryman and condemn his boilers. Hand ended full of machinegun bullets in a lot behind the Hawthorne Inn, but Gorman went on to dominate the Laundry Owners, Linen Supply, Hand Laundry and Laundry Service associations, imposing levies as high as 10 percent of the gross business.

Poison was the persuader adopted by the Kosher Meat Peddlers' Association. They hurled bottles of it into delicatessens that bought their sausages from unaffiliated wholesalers. The Beauty Parlors' Protective Association approached unwilling prospects in two stagesfirst, a little black powder ignited on the ledge of a rear window; then, if that failed to break down resistance, a stick of dynamite tossed into the middle of the shop. For a time few sporting events could be held in Chicago without casualties unless the promoters hired their help from the Theater Ticket Takers' and Ushers' Union at $5 a head. Since the union's labor pool consisted largely of small boys happy to take tickets or usher for nothing if they could watch the game, its margin of profit was exceptionally big.

The Electric Sign Club found it relatively easy to extort protection payments of $1,500 to $2,000 from theater owners after its thugs flooded one theater with gasoline and set it afire. The Janitors' Union operated in tandem with the Milk Drivers' Union to victimize apartment-building owners. The milk drivers would deliver no milk to apartments that did not employ extra janitors, while the janitors would not stay on the job unless the tenants bought their dairy products from designated suppliers. The Elevator Operators obtained an assessment of $1,000 from each of twenty-five Loop skyscrapers on pain of suspending service without warning, leaving hundreds of people stranded on the top stories. Not even the lowly bootblacks escaped exploitative unionization. They had to pay an initiation fee of $15 plus monthly dues of $2.

Toward the end of 1928 the state's attorney's office compiled a list of ninety-one Chicago unions and associations that had fallen under racketeer rule. Affecting nearly every small business and a good many big ones, they included the Retail Food and Fruit Dealers (initiation fee: $25; monthly dues: $5), the Master Photo Finishers, the Junk Dealers and Peddlers, the Candy jobbers (still another Gorman enterprise, it was said to gross $7,000,000 a year), the Commission Wagon Owners, the Newspaper Wagon Drivers and Chauffeurs, the Building Trade Council, the City Hall Clerks, the Steamfitters and Plumbers, the Marble Setters, the Theater Treasurers and Box Office Men, the Glaziers, the Bakers, the Excavating Contractors, the Window Shade Manufacturers, the Barbers, the Soda Pop Peddlers, the Ice Cream Dealers, the Garbage Haulers, the Window Cleaners, the Street Sweepers, the Banquet Organizers, the Golf Club Organizers, the Automobile Mechanics, the Distilled Water Dealers, the Electrical Workers, the Clothing Workers, the Musicians, the Dentists' Technicians, the Safe Movers, the Florists, the Structural Iron Workers, the Motion Picture Operators, the Painters and Decorators, the Vulcanizers, the Carpet Layers, the Undertakers, the Coal Teamsters, the Jewish Chicken Killers, the Poultry Dealers, the Master Bakers of the Northwest Side, the Wholesale and Retail Fish Dealers -the last four associations organized by the sharklike Maxie Eisen.

Gradually, Capone or one of his affiliates came to control the majority of the Chicago rackets. Some investigators put it as high as 70 percent. Of the estimated $105,000,000 the Capone syndicate grossed in 1928, about $10,000,000 flowed from the rackets. That year, as a result of his dominant position among the racketeers, Ca pone found himself a partner in a legitimate business. How this came to pass demonstrated more forcibly than any event in his career the scope of his power and the impotence of the police.

The most omnivorous Chicago racket was the Master Cleaners' and Dyers' Association. It not only skimmed 2 percent from the gross annual earnings of every member wholesale plant, but exacted dues and fees totaling $220 a year from every retail shop that collected clothing for the plants and every trucker that delivered it to them. A favorite device of its terrorists for forcing independents into the fold was the exploding suit. Into the seams of a suit they would sow inflammable chemicals, then send it for cleaning to the defiant plant. When detectives from the state's attorney's office asked the association's business agent, Sam Rubin, who had never worked as a cleaner or dyer, how he qualified for his position, he replied: "I'm a good convincer."

In the spring of 1928 the association decreed a citywide increase in the price of pressing from $1 to $1.75 for men's suits and from $2 to $2.75 for women's dresses. Morris Becker, an independent who operated a chain of retail stores as well as a wholesale plant, defied the order. Shortly, his foreman introduced him to Rubin. "Oh, you are the Mr. Rubin I hear so much about," said Becker (as he had the pluck to testify later before a grand jury) .

"Yes," said Rubin, "and you will hear a great deal more. I want to tell you something-you are going to raise prices."

"The Constitution guarantees me the right to life, liberty and full pursuit of happiness," said Becker.

"To hell with the Constitution. I am a damned sight bigger than the Constitution."

Three days later a blast of dynamite partly wrecked Becker's main plant. This was followed by a visit from another association officer named Abrams. "I want you to know," Becker told him, "that these are our prices and we will stick by them."

"If you do, Becker, you're going to be bumped off," said Abrams.

Becker filed a complaint with the state's attorney's office. Fifteen officers, among them Sam Rubin, were indicted. Clarence Darrow defended them. The only prosecution witnesses to show up for the trial were Becker and his son, Theodore. When they asked the assistant state's attorney trying the case what had become of the others, he replied: "Go out and get your own witnesses. I'm a prosecutor, not a process server." The racketeers were acquitted.

Since the law could not protect him, Becker turned to Capone. The result was a newly incorporated chain, the Sanitary Cleaning Shops, with Capone, Jake Guzik and Louis Cowan sharing a $25,000 equity. The first Sanitary Cleaning Shop opened near Capone's Prairie Avenue home. "I have no need of the police or the Employers' Association now," said Becker in a public statement infuriating to both. "I now have the best protection in the world."

CAPONE WARS ON RACKETEERS was the headline over a Chicago Daily Journal story that poured scorn on the authorities; INDEPENDENT CLEANERS BOAST GANGSTERS WILL PROTECT WHERE POLICE FAILED.

The temporary beneficiary was the consumer. The Sanitary Cleaning Shops maintained the old price scale, and the association had no choice but to do the same. When Capone was asked thereafter to give his occupation, he liked to say, "I'm in the cleaning business."

If Dan Serritella's word can be credited, at about the time Capone succored Morris Becker he performed an equally valuable service for the autocratic publisher of the Chicago Tribune, Colonel Robert R. McCormick. As Serritella recounted the story two years later in a letter to Mayor Thompson:

... Max Annenberg, director of circulation, told me the Trib- bune was having some trouble with their chauffeurs and drivers ... they were going to call a strike for the following Saturday, and he wanted me to get someone to talk to the executive committee. . . . He said that Dullo, business agent of the union . . . demanded $25,000 to straighten out the strike. Annenberg said he wanted to treat the boys right and that he wanted to reach someone who could get the executive committee to fix the strike up.

I told him that as president of the newsboys' union there was nothing I could do. Then Max Annenberg said he would call up Capone and see if he could do anything in the matter, which he did and made an appointment with Capone to meet him in the Tribune's office. I attended this meeting, at which Capone agreed to use his influence to stop the strike, which prevented same. Max Annenberg then ... introduced McCormick to Capone. McCormick thanked Capone for calling off the strike and said, "You know, you are famous, like Babe Ruth. We can't help printing things about you, but I will see that the Tribune gives you a square deal."

The letter, published by Thompson in a campaign booklet entitled The Tribune Shadow-Chicago's Greatest Curse, drew a different version from McCormick: "I arrived late at a publishers' meeting. Capone walked in with some of his hoodlums. I threw him out and after that I traveled around in an armored car with one or two bodyguards. Capone didn't settle anything. And he didn't take over the newspapers as he wanted to do."

Yet a news delivery strike had been threatened and averted. Forever after, when Capone, in self-appraisal, would enumerate what he considered to have been his major public benefactions, the abortive strike figured high on the list. "People don't understand that I settled it," he would say in an aggrieved tone. "McCormick wanted to pay me afterward, but I told him to give the money to a hospital."

The inventor of the mechanical rabbit for dog racing was a St. Louis promoter and greyhound fancier named Oliver P. Smith. He first tested the device in 1909 and spent the next decade developing it. After filing patent application papers, he formed a partnership with a sharp-witted young St. Louis lawyer, Edward J. O'Hare. For the right to install a mechanical rabbit dog track owners paid them a percentage of the gate. Smith died in 1927, considerably enriched by a sport that had caught on in both America and Europe, and under an arrangement with his widow O'Hare obtained control of the patent rights.

Dog racing was then illegal throughout the country (Florida became the first state, in 1931, to legalize it), and the track owners to whom O'Hare leased the rabbit ran mainly to mobsters. Capone's initial venture into the field, undertaken jointly with Johnny Patton, was the Hawthorne Kennel Club on the outskirts of Cicero. Unlike the later closely supervised legal sport, the dog racing of the twenties was fraught with traps for the innocent bettor. Nothing was easier than to rig a pari-mutuel race. Given eight entrants, for example, overfeeding seven of them by a couple of pounds of meat or running them a mile before the race would guarantee victory to the eighth dog. O'Hare despised the men he had to deal with as much as he enjoyed the riches they showered on him. "You can make money through business associations with gangsters," he once said, "and you will run no risk if you don't associate personally with them. Keep it on a business basis and there's nothing to fear."