The Outfit (13 page)

Unmentioned in most gang histories are the benefits that accrued from an association with Curly and the Outfit, not the least of which was protection. Dr. Jay Tischendorf remembers a story told by his grandfather, who drove a horse-drawn milk wagon in the years after Curly Humphreys had taken over the Milk Wagon Drivers’ Union. “My grandfather was robbed at gunpoint by two men who took all that day’s receipts,” Tischendorf says. “My grandfather was distraught. He apologized to his boss, who told him to not worry. The boss said they were not going to the police. Instead they were going to the union.” In one week’s time, the two scoundrels’ bodies were found floating in Lake Michigan.

Regretfully, not all the Outfit’s racketeering takeovers were as bloodless as the laundry and milk operations. When Humphreys set his sights on Ben Rosenberg’s dry cleaning business, Rosenberg resisted Humphreys’ cajoling. Typically, the pressure escalated to Plan B, when Curly dispatched Philip Mangano and Louis Clementi, who spilled acid on clothes in four of Rosenberg’s trucks. When that failed, they beat Rosenberg mercilessly. Then Ben Rosenberg did the unthinkable: Instead of rolling over, he went to the police. When a grand jury returned indictments against Mangano and Clementi, Rosenberg turned up dead, murdered before the case could come to trial.

Humphreys remained largely unscathed throughout the many years of his labor racketeering. On the few occasions when Humphreys was detained for questioning, he was able to either talk his way out of arrest or pay off the cops before they had time to announce their appearance. On one occasion, a witness to one police confrontation with Humphreys witnessed the payoff king whip out his wallet as soon as he encountered the officers. Proceeding to count out ten $100 bills, Curly asked, “Can’t we settle this right here among friends?” Usually they could.

Humphreys’ union struggles were only one of the responsibilities he assumed when Big Al “went away.” Given his natural talents, Curly became, most likely by default, the Outfit’s liaison to their political and law enforcement allies. In a tradition going back as far as Chicago’s nineteenth-century bosses, compliant, graft-addled cops and politicians were an integral part of organized crime’s success in Chicago. Hum phreys’ sharp-witted second wife recently described her husband’s modus operandi: “He was buying cops like bananas - by the bunch.” Humphreys’ hold over Chicago’s finest became so total that veteran policemen were routinely dismissed for harassing Outfit members. The gang’s Einstein had similar success in the city and state legislatures, where Outfit-controlled pols routinely blocked anticrime bills. When one Illinois governor threatened to pass get-tough laws, the Outfit sent an emissary directly to the governor’s mansion with their proposal. “Drop the crime bills, chief, and we’ll pass the two main planks of your program for you,” offered the gang’s representative. When the chief executive refused to cave in, the Outfit made good on its threat, killing a key bill to establish a state Fair Employment Commission, and a bill calling for a badly needed new state constitutional convention.

Starting with Capone’s reign the gangsters looked to one politician in particular to advance their interests. His name was Roland V. ’Libby’ Libonati. With Capone’s and the Outfit’s support, Libonati was propelled upward to the state legislature, where he served for twenty-two years, and from there to Washington (1957), where he became “the mob’s congressman,” installed on the powerful House Judiciary Committee. After all, it was said, the “white collars” had their representatives, why shouldn’t the Outfit?

Libby developed a colorful persona, and a verbal style that earned him the moniker Mr. Malaprop. Libonati waged a one-man war on the English language with phrases that are remembered in the Windy City to this day: “No one should speak asunder of the governor”; “I am trying not to make any honest mistakes”; “The moss is on the pumpkin”; “Chicago is the aviation crosswords of the world”; “I resent the insinuendoes”; “Chicago will march on to new platitudes of learning”; “. . . for the enlightenment, edification, and hallucination of the alderman from the Fiftieth Ward . . .”; and the unforgettable “walking pedestrians and tantrum bicycles.”

Libonati, whose attorney brother Eliador also frequently represented Capone, flaunted his role with the Outfit, appearing often in public with the Big Guy himself, even being photographed sitting with Capone and “Machine Gun” Jack McGurn at a Chicago Cubs baseball game. “I was very proud when he [Capone] asked me at the ball game to speak to his son,” Libby later recalled. “Mr Capone showed me great respect as a person of Italian extraction who represented one of the pioneer families in Illinois . . . I treated him with like respect as I would any American. If people treat me nice, I treat them nice.” In 1930, when the Chicago police’s goon squad wanted to round up some of the boys for routine questioning regarding Capone’s whereabouts, they knew right where to go: Libby’s campaign headquarters, where he was celebrating his election to the state legislature. There, according to police reports, they bagged some twenty gangsters “hanging out.” On that occasion, Curly was among those taken in for questioning. Libonati was himself once arrested while in the company of Curly, Paul Ricca, Frankie Rio, and Ralph Pierce. When Frank Nitti was imprisoned in 1931, Libby was a regular visitor. That same year he represented Joe Accardo when Accardo was arrested for a hit. In that instance, counselor Libonati came to the rescue, seeing to it that the indictment was nol-prossed. He did likewise for Paul Ricca years later. Three decades later, Libby’s top aide, Tony Tisci, would become the son-in-law of future boss Sam Giancana.

For more than four decades Libby and Curly would work together to stall the efforts of the G, especially future attorney general Bobby Kennedy, to prosecute the Outfit.

Under Curly’s stewardship, and with his wife, Clemi, keeping the books, labor racketeering was perfected, turning a modestly profitable con into a multimillion-dollar operation, with the Outfit controlling as much as 70 percent of the city’s unions. In 1928, the boys were seeing an estimated $10 million a year in profit from Curly’s rackets; by 1931, estimates escalated to over $50 million - small by bootlegging standards, but with unlimited potential, since unlike Volstead, labor was never going to be repealed.

While the unions were coming under Humphreys’ control, Joe, Paul, and Johnny were quietly laying plans for future conquests with a national scope. However, before the Outfit could put its bold new schemes into motion, a number of temporary hurdles needed to be overcome.

1
. Gibaldi, a talented athlete in many sports, was given the name Jack McGurn by his boxing manager. Irish brawlers, à la Jack Dempsey, were perceived as more marketable at the time.

3.

Playing Politics

W
hile the G was building its tax case against Al Capone, local officials were being embarrassed into action against the gangsters. One year before Capone’s 1931 conviction, federal officers had stumbled onto a bombshell. While searching for Frank Nitti at a known Syndicate hangout, the agents discovered a list prepared by local police chief John Ryan. The one-page memo targeted forty-one gangsters for prosecution. Informed individuals asserted that Curly Humphreys had bribed an official to obtain the secret memorandum. The list found by the officers showed X’s next to eight of the names, who were Capone’s hierarchy (including Humphreys, Accardo, Hunt, and Campagna). It was learned that after Ryan had dictated it, the list had been retyped for official distribution. When the Nitti list was compared to the four copies in possession of police officials, those key names no longer appeared. Supposedly, Curly had delivered the note to Capone, who had himself penciled in the X marks and somehow managed to get the Syndicate-edited list into official circulation.

The local police were forced to escalate their inquiries into Nitti and the others. After Nitti was released from a brief tax-evasion term in 1932, he found that the heat on him had not dissipated. With the upcoming Democratic National Convention and the 1933 World’s Fair both being hosted in Chicago, local officials desired to give at least the appearance of civility. This quest manifested itself in the person of the newly elected mayor, Anton “Ten Percent Tony” Cermak. During the mayoral campaign, Capone’s Syndicate had naively thrown its considerable weight behind Cermak, believing Tony’s racketeering background would render him sympathetic to the gang’s needs. In fact, Cermak was playing a dangerous game, planning to backstab the hoods once they had helped get him elected.

“The mob doesn’t know how I really feel about them,” Cermak told Judge John Lyle days before the election. “I think I can get some support from the mob during the campaign. I’ll take it. But after the election I’ll boot them out of town.” After his 1931 ascension to the mayoralty Cermak thus joined the long list of Chicago’s faux “reform” mayors. On his first day in office, Cermak double-crossed the gangsters. Loudly promising to “assign some tough coppers” to chase out the hoods, Cermak concealed his real intent: to eliminate the
Italian
gangsters, who were prone to settling their differences in full public view. But more important, Cermak wanted to anoint a set of less embarrassing lawbreakers whom he could control from within City Hall. It was a pattern he had established early in his career. The newly installed mayor vowed to show the world that the upperworld ran Chicago, not the underworld.

Anton Cermak was born in 1875 in Kladno, Bohemia. After his family’s immigration to America, Tony, as he was called, worked his way out of poverty, eventually becoming an Illinois state legislator. To facilitate his chief goal in life (becoming rich), Cermak began building political organizations. While in the statehouse, Cermak assumed leadership of the United Societies, a lobby of saloonkeepers, distillers, and brewers. A Chicago historian described the arrangement: “As leader of an organization which assumed the misleading name of United Societies, Cermak aroused and organized the underworld to enforce its demand for a wide-open town. For a quarter of a century, any politician, whatever his party, who dared to support any measure that would curb the license of those antisocial hordes, was immediately confronted by Cermak, snarling and waving the club of the underworld vote.”

Simultaneously, Ten Percent Cermak maintained sideline real estate and business insurance operations. Using insider information he acquired in the legislature, Cermak’s real estate business quietly purchased land that the state soon coveted for parkland. Meanwhile, Cermak’s insurance company obtained lucrative contracts from businessmen seeking favors in the statehouse. By the time he was elected mayor, the interest-conflicted Tony Cermak, the son of a poor Chicago policeman, was worth over $7 million. But the king of insider information had even greater ambitions: His sources had told him that Volstead was going to be repealed and the time was right to seize control of the soon-to-be-legal booze and gambling rackets.

Mayor Cermak understood that Al Capone would never relinquish control of his Syndicate’s speakeasies and gambling joints. Even though Capone himself was on a fast track to prison in 1931, Cermak concluded that the same fierce independence had been inherited by the new Outfit. Thus Cermak struck a fateful alliance with a successful independent bootlegger and gambling czar named Roger Touhy.

At the time of Cermak’s election, thirty-three-year-old Roger Touhy ran a thriving slot machine and hooch operation out of the suburb of Des Plaines, fifteen miles northwest of Chicago. By 1932, Touhy and his brothers had overrun the Chicago Teamsters organization, which preferred the evil of the Touhys over the evil of Capone. Until his alliance with Cermak and the subsequent battles with the Outfit, Touhy was most notable not only for being the last major Irish bootlegger since the fall of O’Banion, but also for his continued refusal to cave in to the Syndicate. The ingenious Touhy once averted a threatened raise in police bribery fees by purchasing a fleet of Esso gasoline delivery trucks with which to secretly make his booze deliveries.

Capone had first tried to cajole Touhy into a partnership, but to no avail. Soon, Capone began a campaign of terror, kidnapping and assaulting Touhy’s men. The Teamsters bequeathed the Touhy brothers $75,000 to wage war with the Capones. In responding to Capone’s thuggery, Touhy made a monumental miscalculation: He confronted Capone in a show of bravado, threatening Capone in his own headquarters. Showing up one night at the Four Deuces, Touhy played his hand, telling Capone, “Stay out of my business. I tell you that for every man of mine kidnapped, I’ll kill two of yours.” With that Touhy turned and left. Capone may have been briefly amused by Touhy’s act of lunacy, but in time Touhy would learn that Capone had a thin skin. He never forgot Touhy’s insolence.

One of Capone’s many efforts to ensnare Touhy came in 1930, while the Big Guy was in the Philadelphia lockup. By telephone, Capone instructed Humphreys to pay a call on Roger “the Terrible” Touhy. Previously, Curly had kidnapped Touhy’s partner, Matt Kolb, prompting a $50,000 payout by Touhy. Now, accompanied by his driver, James “Red” Fawcett, Humphreys dropped in on Touhy at his Schiller Park headquarters. In Touhy’s office, Curly made his best effort to convince Touhy of the mutual benefits of an alliance, suggesting Touhy come to Cicero to form a partnership with Nitti and the Outfit. At one point in the discussion, Touhy was called out of the room to take a phone call from a Capone soldier who owed Touhy a favor. “Don’t go to Cicero, they’re going to kill you,” the informant warned.

On his return to the office, Touhy declared that Nitti should come to him if he wanted to talk. Curly feigned bravado saying, “You know, Touhy, we can take care of you anytime we want to.” Touhy grabbed an ornamental shotgun off the wall, causing Curly to tremble visibly, much to Fawcett’s surprise. Humiliated, Curly offered Touhy his limousine if he spared his life. Touhy declined the offer, but allowed Curly and Fawcett to crawl back to Cicero. Like Capone, the chagrined Humphreys never forgot his encounter with Touhy and kept a watchful eye for the chance to avenge it. Not long after Cermak’s election, the opportunity would present itself.

Touhy’s operation stood out as one of the few that had successfully resisted assimilation into the Capone organization, while Mayor Cermak’s putsch manifested itself in a precipitous rise in the number of Capone-linked mobsters killed by cops, ambushed by Cermak’s “special squad.” It was not unnoticed by the Outfit that Touhy’s vast enterprise remained curiously untouched. It was soon learned that Touhy was a longtime friend of Cermak’s, for whom he supplied barrels of beer when Cermak hosted the Cook County Board of Commissioners’ annual picnic. One of Cermak’s most trusted insiders told the Illinois parole board in 1959 that he had witnessed the formation of a Touhy-Cermak alliance. Meeting in Cermak’s office, the mayor offered to help Touhy wage a full-scale war on the Outfit. To insure that Touhy would have sufficient manpower, Cermak offered to put his five-hundred-man police force at Touhy’s disposal. “You can have the entire police department,” Cermak said.

What had to be more infuriating for the Capone gang was the apparent defection of one of their own to Team Cermak. Teddy Newberry was a gambling-club owner and ward boss from the North Side who had sided with Capone’s Syndicate after the Beer Wars against the O’Banion crew. Such was Big Al’s gratitude that he had lavished on Newberry a diamond-encrusted belt buckle. Newberry became so trusted by the Outfit that he had assisted Curly Humphreys in a protection scam as recently as early 1932. Sometime that year, Cermak apparently made Newberry a better offer, and the triumvirate of Cermak-Touhy-Newberry began plotting a serious assault on Nitti and the Outfit. The assault had a personal impact on Curly Humphreys when his trusted labor adviser George “Red” Barker was gunned down by Touhy’s killers. When word reached the Outfit that Touhy and Newberry were Cermak’s approved gangsters, Curly and the Outfit set about plotting their revenge. All the while, events in Washington would force the gang to diversify its interests; the cash cow of booze was soon to disappear.

Repeal

The violence associated with Capone’s regime was the last straw in the fast-growing movement to repeal Volstead. The Great Depression and the gangster era exposed the prohibitionists’ hollow promise that banning alcohol would lead to a prosperous nation. Too late, the nation realized that, in addition to rampant alcoholism, the ill-considered legislation had created powerful gangs. Once again taking the lead, America’s women, shepherded by Pauline Sabin’s Women’s Organization for Prohibition Repeal, pushed for repeal. It was a fitting development, given that women had been largely responsible for the birth of the prohibition movement. With pro-repeal sentiment taking off, the “dry unions” were now greatly outnumbered. Newspaper polls estimated the repealers at 80 percent of the populace.

By 1931, New York governor and presidential aspirant Franklin Roosevelt had joined the campaign against prohibition, asserting that $300 million could be raised in alcohol taxes to fight the depression that had gripped the country since the October 29, 1929, stock market crash. Furthermore, booze at least provided some comfort during the Depression. For the gangsters, Roosevelt’s potential election, and the possibility of an end to bootlegging, foreboded a massive drop-off in revenue.

On February 20,1933, Congress passed the Twenty-first Amendment, nullifying the Eighteenth. Ten months later, the needed three-fourths of states had ratified the measure. On December 5, 1933, the bootleggers were officially out of business, at least the booze business. The labor rackets were in full swing, under the guidance of Curly Humphreys, while Joe Accardo concentrated on gambling. But the profits from these activities would pale in comparison to the riches that awaited the boys in a few short years. In the meantime, the Outfit experienced firsthand what Big Al had often told them: “Nobody’s on the legit.”

The Outfit’s Political Education

The Outfit-Touhy counterplots took some time to coalesce, and so by June 1932, a stalemate was in place as the Chicago elite held its breath while welcoming the Democratic national delegation. And although both Curly and Joe advised the Outfit to keep violence to a minimum, there were nonetheless more than thirty gangland murders that year.

The 1932 Democratic nomination was tightly contested by two New York governors: Franklin Delano Roosevelt (the incumbent) and former four-time governor Al Smith. The Outfit had a front-row seat to the internecine backdoor warfare that chose the candidate. The boys would put this education in politicking to good use in many future presidential contests.

Accompanying the nation’s party hacks to Chicago were members of the Torrio-Luciano Commission. In his authorized biography,
The Last Testament of Lucky Luciano,
New York gang chief Charles “Lucky” Luciano recalled how he arrived in town with other mob luminaries, including Meyer Lansky, Longy Zwillman, Moe Dalitz, Phil Kastel, and Frank Costello. The group also included Kansas City machine boss Tom Pendergast, who was sponsoring the ascendancy of future president Harry S Truman. The mobsters were ensconced in six-room suites at the posh Drake Hotel overlooking Lake Michigan. Whereas the delegates were hosted by the local Democratic elite (headed by Mayor Anton Cermak), the gangsters were squired by Ricca, Accardo, Guzik, and the rest of the Outfit. “They supplied all the booze we needed for free,” Lucky remembered. Luciano said that the scene at the convention was similar to that at the Drake: “Liquor was for sale openly to any delegates at stands run by the heirs of Al Capone. In the hospitality suites run by the Outfit, liquor was free to all comers, and it was poured steadily and unstintingly all hours of the day and night. The bar was never closed and the buffet tables were constantly replenished.”

The nomination proved a dogfight, with a bitter Al Smith leading a vigorous “Stop Roosevelt” faction that succeeded in denying FDR the needed support for the first three ballot votes. Then, as they would in many future presidential contests, the upperworld turned to the underworld for assistance. The candidates’ aides and their sought-after delegates swarmed to the Chicago Stockyards and proceeded to maneuver the powerful ganglords. As Luciano recalled, “We waited until the very last second, and we had Roosevelt and Smith guys comin’ out our ears. They all knew we controlled most of the city’s delegates.”