You cannot really rely on newspapers articles. Recently, it featured the confessions of repenting organized crime members, i.e. the distort truth for their own interests. The police distorted the figures to get credit and money from the Federal Government. Organized crime was considered as a kind of un-american activity. Since more gangsters were ethnics (Jews, Russians, etc), calling them "un-american" was a way of dismissing american roots. In Scarface, the motto "the world is yours" highlights the ironic vision between the American Dream and the gangsters.
The structure of organized crime is that of a bureaucratic and corporate model. It looks like a company organic line, with a complex hierarchy and a division of labor. Responsibilities are carried out in an impersonal manner and the function is more important than the person.
Organized crime is a mirror of monopoly capitalism and from earlier gangster movies, it is considered as a business. Asphalt Jungle: "crime is just a left handed form of human endeavor". The difference between organized crime and any corporation is that you cannot use written support: it relies on secrecy and personal networks.
Organized crime before prohibition
The first gangs appeared in the mid 19th century in big cities, in ethnic districts. These gangs were born out of one major contradiction in the United States: opportunity for all and equality for all - and real practice of this combination (the discrimination against foreigners: Jews, Catholics, Russians, Polish...)
The West was usually not an option in 1890 for it was closed. Eastern cities like Chicago were cities where ghettos had formed. There was a regulated competition in poor ghettos and knowing a gang member was a good way to get a job.
There were different levels: the federal level, the city level and the county level. Each level has a strong degree of independence. One county could decide to stay dry (without alcohol) where another would be wet.
Police forces in the 1920's
Almost no state police at the time. The Federal agencies were weak until the 1930's. The police jobs were distributed this way: if you were given a job by a Democrat party, you would vote Democrat and influence other people to vote as such.
Pre-Prohibition Organized Crime
Since the end of the Civil War, American capitalism gave rise to monopoly capitalism, through horizontal integration (the bigger ones buy smaller ones and merge) and vertical integration (one company controlling several parts of a business: manufacturing or raw materials, distribution, selling...). It is characterized by fierce competition: end of productive power, spreading of false rumors on the stock market and the taking advantage of it.
Newspaper magnate R. Hearst hired gangsters to buy his newspaper and convince others to buy them. C. Vanderbilt started a civil war to get control of the canal of Panama to protect his own interests. Hollywood used the practice called "blind booking" (or "block booking") to be sure to control the distribution of their films. If a distributor wanted one film, it had to buy the whole stock. This gave rise to the Anti-Trust Act to prevent complete monopoly.
In Chicago beer war, the means were slightly more violent but the aims were the same: to get the monopoly. As Al Capone put it: "I'm just a businessman, I provide what people needs".
The Prohibition: struggle for a definition of America
The Prohibition was initiated by nativistic desires. We could define nativism as:
- a reaction to the changing patterns of immigration.
- industrialization and urbanization.
- changing moves.
A - Reaction to the changing patterns of immigration
Around the 1880's-1890's, people from Poland, Tchecoslovaquia, Eastern Europe arrived in America. This did not please the "older" Americans. The USA were a protestant country and the Ku-Klux-Klan accused the immigrants of all the wrongs.
B - Industrialization and urbanization
The first American dream saw America as a land of morality. The urban way of life was a shift from an economy of scarcity to the beginning of the consumer society in the 1920's, with credits for cars, telephone, entertainments...
Cinema was a symbol between a new technology and a new way of life based on consumption. Money is here to be spent. Pleasure is worthwhile (cinema, cabaret, jazz). The "Roaring Twenties" were a huge part of the young Americans. New types of sexual values: the "flapper" is the new 1920's woman. (Note: woman was the cornerstone of morality).Censorship first applied to gangster movies and to the movies describing this new sexuality.
C - Changing moves
The Prohibition is an attempt to give back America its morality. The immigrants were associated with people who drank Italian wine, Irish beer.. After World War I, the enemy was Germany: drinking beer was un patriotic. The saloon was not only a place to drink but also a place of social life and a center of vice (prostitutes). Alcohol became the segregation line between the Americans and the undesirable (the immigrants). It was also based on scientific data: eugenics (idea of improving the race), and the idea of preventing alcohol from ruining the future generations. Henry Ford said it would improve the efficiency of his workers (even before the Prohibition, he used to check his workers, even at home !). Creation of women's movements to prevent the abuse and violence at home. 1874 saw the creation of the Woman Christian Temperance Union (WCTV). The Anti-Saloon League was created.
Prohibitionists were not a majority and yet they manages to impose their will to the nation. The real Prohibition came about on the 16th of January 1919 with the ratification of the 18th Amendment by 36 states. In 1920, the Volstead Act prohibited the sale of all intoxicating beverages (more than 0.5% of alcohol), with the exception of the beverage needed for medical purposes. The consumption of alcohol at home was not prohibited but its manufacturing, distribution... was.
This was not a popular law and people tried to drink all the more. Since supply of alcohol was banned, they had to find other ways: by making alcohol illegal, it made it more desirable. The speakeasy were clandestine bars where you could buy alcohol. The Roaring Twenties were the age of jazz, alcohol and sexual liberation.
Repression was made difficult by the widespread corruption at every level. Politicians were corrupted, especially at the Prohibition bureau. Basically, Prohibition made things go from bad to worse. Gangsters were able to intimidate witnesses and to avoid going to prison. In 1920, there were 6.8 murders for 1000 people. In 1933, there were 9.7 murders for 1000 people.
The gangsters had a popular image: they were businessmen providing the people with what they needed. They were considered as men who made it and embodied the American Dream, especially in the period of depression of the 1930's.
The Prohibition increased enormously the power of gangsters. There was an economic mutation: the alcohol being banned, the prices went up and there were high risks in running an alcohol shop. Legal businessmen stopped their production, except for medicine or for non-alcoholic beers (inferior to 0.5% alcohol). The thing is that before the removing of alcohol, you had alcoholic beers... It became a highly lucrative system for gangsters, much more important than prostitution or gambling. It was an expensive investment but it produced high revenues. You had to import your alcohol and hire people to protect it (Al Capone hired 700 gunmen). Organized crime became very influential.
A way of getting alcohol was to hi-jack federal reserves or stealing ale before the alcohol was removed, or alcohol destined to medicine use. Some people tried to produce their own whisky, mixed with turpentine but it was so toxic that people could die from it (!). Vertical integration controlled the importation and production of alcohol. Organized crime was first local and then became a wider organization thanks to syndication.
The Prohibition increased the criminality. Organized crime in the United States was not imported. Capone's gang ruled part of Chicago and when it became too hot, it moved to Cicero. This control was so important that Capone was able to impose mayors.