The Jews in America Trilogy (142 page)

Soon, into the Lansky-Luciano group came another, somewhat older Jewish youth named Benjamin Siegel. Siegel was a well-built, good-looking fellow who had quite a way with the ladies, and whose ambition in those days was to become a movie star. It was not such a farfetched notion, since one of his best friends was a young actor named George Raft. Raft had been a street fighter and gambler out of Hell's Kitchen, and had boxed his way up from a number of small-time clubs all the way to Madison Square Garden, where he realized that he hadn't the fighting ability to reach top boxing circles. He had turned to dancing in nightclubs and revues, and became famous overnight for teaching the young Prince of Wales to do the Charleston. From there, it was on to Broadway and
Hollywood. His friend Benny Siegel, though, had kind of a wild streak in him. Most Jewish and Italian street toughs eschewed knives and guns, but Siegel was always armed with one weapon or another, and would brandish these at the slightest provocation. For this behavior, and other bizarre habits—it was said that Siegel invented the game called Russian roulette—he was labeled “crazy as a bedbug,” which earned him the nickname “Bugsy,” though this was an appellation his friends were careful never to use to his face. Bugsy Siegel, as we shall see, eventually did get to Hollywood, though not in the manner he had originally planned.

Into this loosely organized but very effective fraternity came other Lower East Side Jews: Abe “Kid Twist” Reles, whose nickname derived from the fact that even as a kid he was adept at the “twist” of extortion; Arnold “the Brain” Rothstein, much admired for his ability to conceive and carry out grand schemes, and who came up with the notion of fixing the 1919 [baseball] World Series between the Chicago White Sox and the Cincinnati Reds. Then there was Jacob “Greasy Thumb” Guzik, whose thumb, it was said, was stained green from collecting bribes and blackmail; and Abner “Longie” Zwillman, whose nickname referred to the uncommon length of a certain anatomical endowment; and Louis “Lepke” Buchalter, whose doting mother called him “Lepkele,” or “little Louis,” and whose early career had involved picking pockets and robbing pushcarts. But from the very beginning of the organization, there was only one man who was its acknowledged leader—the little Caesar who planned the battles, deployed the troops, settled internal arguments, and, with his mathematical genius, kept the books—and that was Meyer Lansky. If much of the brawn of the group was supplied by others, it was Lansky who supplied the brains.

Lansky never liked to think of his chosen means of livelihood as anything other than a business. It might not be a legitimate business, but it was still a business, and Lansky tried to keep it on as businesslike a level—no tampering with the books—as possible. It was a business, as he saw it, that was designed to cater to certain basic human needs—a service business. Human beings liked to gamble, and would gamble whether gambling was legal or not, and so Lansky and his associates would put themselves at the service of gamblers. At the same time, Lansky had his own strict moral code. He would
not, for example, involve himself in prostitution. Prostitution could also be rationalized as fulfilling a human need, but Lansky would have none of it. Some of his partners called him a prude for this, and in a way he was. But he was also something of a snob. He considered prostitution dehumanizing, but it also got one mixed up with all the wrong sort of people. As a boy, he had seen a beautiful Jewish prostitute named Rachel, to whom he had taken a fancy, beaten to death in a back alley by her Jewish pimp. The grisly, sordid scene remained etched in his mind.

He felt the same way about trafficking in narcotics. Again, the people who were in the drug trade struck him as lowlifes whom he wouldn't want to be seen with, and the addicts they served were the dregs of humanity. Lansky had his standards. In many ways, if you overlooked his source of income, Meyer Lansky was a young gentleman of the old school. As he began to prosper from his gambling operations, he remained a conservative fellow. His friend Bugsy Siegel might favor loud neckties and flashy sport coats, but Lansky always dressed quietly in well-cut three-button suits—which, with his slight figure, he usually bought in the boys' department of Macy's. He did not look like a “gangster,” nor did he act like one. In manner, he was genial, soft-spoken—except, of course, when crossed. He was also a devoutly pious Jew and faithfully kept the Sabbath.

Still, Lansky and Company's business might have remained a relatively small one had it not been for an event that, for an organization dedicated to serving human needs, amounted to nothing less than a windfall. On January 16, 1919, the Eighteenth Amendment to the Constitution of the United States was ratified, to become law one year later. The amendment banned the manufacture, sale, and transportation of liquor, wine, beer, or other intoxicating substances. Nine months later, over President Wilson's veto, the Volstead Act was passed by Congress, toughening the Prohibition laws and setting up the machinery for their enforcement. The Women's Christian Temperance Union had been triumphant; the “noble experiment” had begun.

Perhaps never in the history of government folly had an experiment so doomed to failure been undertaken, and certainly never had a scheme so outwardly drenched in piety and righteousness been embarked upon with so much cynicism. America
had been a drinking nation since pre-Colonial times, and there was nothing to indicate that Prohibition could change this. Instead, Prohibition was an open invitation to break the law, and to break it in the most daring, glamorous, and exciting ways. Drinking in America had always been associated with parties and good times, and now Prohibition offered Americans a chance to go on a prolonged, illegal binge. Even as Prohibition was being enacted into law, the very legislators who had voted for it were planning ways of obtaining their own personal supplies of liquor. The “year of grace” allowed wealthy hoarders plenty of time to stock their cellars for years to come. Furthermore, it gave legitimate bars and restaurants time to convert to illicit speakeasies, so that by the early 1920s, there were thousands in the city of New York alone. It also allowed men like Meyer Lansky and his friends the time to develop an elaborate game plan for buying and marketing alcoholic beverages, so that when the Volstead Act finally went into effect, they had a virtually foolproof strategy for working around the law. On the very eve of Prohibition, nightclub comics joked about the various ways of obtaining liquor that would become available the following day. Had it not been for Prohibition, men like Lansky, Luciano, and Siegel might have continued as operators of small-time gambling parlors, living in a series of cold-water tenement flats. But Prohibition offered a golden door to riches—for Lansky, what would become one of the larger personal fortunes in America—all for helping Americans defy an unpopular law. The profits, as Lansky saw them, would be far greater than those from gambling operations; the penalties were far less; and the chance of those penalties being enforced was infinitesimal. Once again, he was in a service business. And he was not yet twenty.

There were two kinds of bootleggers, from the beginning. One dealt in cheap, watered-down liquor and in homemade brews from basement stills. The other dealt in the real thing. Lansky counseled his associates to join the latter group. Partly, it was his snobbish nature. But also, he reasoned, dealing in cut, ersatz liquor—in which a bottle labeled “Scotch” might be only colored water, raw alcohol, and a splash of real Scotch for flavor—meant that one's clientele would consist mostly of skid-row bums and the sleaziest bars; there would be little repeat business. If, on the other hand, one could offer good, uncut,
imported Scotches and gins that had not been tampered with, one would be dealing with the well-heeled—along with the most expensive bars and clubs—who would pay anything for top quality and who, once they had learned to trust their bootlegger, would come back for more of the same. Lansky had also read a book called
Making Profits
, written a few years earlier by a Harvard professor of economics named William Taussig. In it, Professor Taussig had outlined the law of supply and demand. What it meant, Lansky explained to his less literate associates, was, “If you have a lot of what people want and can't get, then you can supply the demand and shovel in the dough.” Among his friends, this quickly became known as “Lansky's Law,” and it would become the basic precept by which organized crime would live from that point onward, just as legitimate capitalist society lived by it, and had been living by it, all along.

But there was more to it than that. As Prohibition began to lift the underworld from what had been a loosely organized group of friends, relatives, and acquaintances into the stratosphere of Big Business, the many ramifications of the Volstead Act became quickly clear. For the average consumer, Prohibition meant essentially one thing: the cost of liquor went up, to cover the costs of the risks involved. But times were prosperous, and the average consumer understood the situation, and cheerfully paid the price. There was money to be made in all directions. Foreign distillers could raise their prices for the illicit American market. The speakeasies that instantly sprang up across the countryside became instantly prosperous, since they could charge their “member” customers more for drinks by the glass than had previously been charged in legal bars. Soon it was estimated that there were at least twenty-two thousand speakeasies on the island of Manhattan alone—far more than there had ever been legitimate bars. (One popular speakeasy on West Fifty-second Street, Jack and Charlie's 21 Club, operated by two brothers named Kriendler, was the forerunner of today's posh and elegant “21” Restaurant as well as the prestigious “21”-brand liquors.) The makers of fruit juices, mixers, and sweeteners also made money, since the flavors of inferior liquors could be disguised by colas and syrups. (The mixed “cocktail” was a Prohibition invention of necessity.) Bootleggers in the smallest towns could make money. Even
poor Italians on the Lower East Side, who had been brewing their own wines and spirits in their homes for years, found themselves proprietors of profitable neighborhood liquor stores. Into all these sources of money Meyer Lansky plunged. As his network of connections in other American cities grew, where local gamblers knew as well as he that their patrons spent more at the gaming tables when their inhibitions had been loosened by alcohol, it was natural that his group should extend its operations into the illegal import of liquor.

Some of the earliest attempts to smuggle liquor into the United States were clumsy and naive. The term “bootlegging,” for example, derived from stuffing bottles of liquor into the tops of oversized boots to foil customs inspectors at American borders. Some carried in liquor strapped to their persons under bulky coats.
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For American bootleggers, the handiest source of liquor was Canada, with its long and relatively unguarded border, much of which was wilderness, and as bootlegging grew more profitable, its methods became more sophisticated. Before crossing the border, for example, a truck driver with a load of contraband would select a dirt road, and then attach heavy chains to his rear bumper. He would then charge across the border, refusing to stop for the customs inspector, while his dragging chains kicked up so much dust that he was impossible to follow.

Liquor made its way into Canada from England, Ireland, Scotland, and Europe by way of two tiny French islands (actually a
département
of France) off the Newfoundland coast that most people have never heard of, Saint Pierre and Miquelon. Here the shipments were uncrated for redistribution to the American bootleg market, and most of the wooden houses on the principal, virtually treeless island of Saint Pierre were built with lumber obtained from castoff liquor crates. From Canada, a particularly popular route of shipment was by boat across Lake Erie, where long stretches of shoreline on both the American and Canadian sides were unpopulated, but where old logging roads led inland from the shore to connect with main arteries. One of Meyer Lansky's first assignments to his
underlings was to have maps drawn of these uncharted roads. In his youth, he had worked briefly as an automobile mechanic, and had learned quite a lot about cars. A side operation was organized to service, repair, and camouflage stolen trucks and other vehicles that were used to transport liquor to the marketplace.

Meanwhile, bootlegging had suddenly become a glamorous occupation, and the bootlegger a glamorous figure. Bootleggers in the early 1920s were like cowboy heroes out of the Old West who took the law into their own hands, and women chattered about their favorite bootleggers as they might about their favorite hairdressers (“We've found the most wonderful new bootlegger …”). In small towns, the bootlegger gained almost the same respect and social status as the local doctor, lawyer, or undertaker. In the cities, bootleggers were invited to all the best parties, and had their pick of the most desirable women. The term “gangster” was used almost reverentially, and Hollywood gangster movies achieved great popularity. A number of silent film stars of the era—Pola Negri, Gloria Swanson, Renée Adorée—were said to have taken gangster lovers. In the best hotels and restaurants, men reputed to be gangsters were given the best tables. When gangsters were recognized, children asked for their autographs.

There were dangers involved in bootlegging, of course, but they were relatively slight. Despite the desperate efforts of American lawmen to police the Canadian border, it was estimated that only five percent of the smuggled booty was ever successfully stopped or confiscated—and any legitimate salesman who succeeded in getting ninety-five percent of his merchandise sold would have considered himself more than fortunate. Occasionally, there were unsettling incidents. In 1927, a convoy of trucks carrying liquor from Ireland was ambushed outside of Boston. The Irish guards who were in charge of the shipment opened fire on the ambushers, and before the shooting was over eleven men lay dead.