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The New York Waterfront Commission: a Command Center for Organized Crime

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The New York Waterfront Commission: a Command Center for Organized Crime Click here for Full Issue of EIR Volume 9, Number 28, July 27, 1982 The New York Waterfront Commission: a command center for organized crime by J. F. Cooper When Sen. Harrison Williams put up a courageous fight the prosecution of Salvatore "Lucky" Luciano on pros­ against his frameup by the FBI's Abscam earlier this titution charges in 1936. Although Luciano was worse year, it allowed Americans to take a close look at a than anything that these charges might imply, Dewey's particularly ugly aspect of what the postwar United case was a thoroughly synthetic frameup complete with States has become. The fact that in the Abscam sting hired floozies who were packed off to Europe after operation, the tail-professional con-man Mel Wein­ testifying against him. The two major results of the case berg-could wag the dog of the FBI was only possible were to make the political reputation of Thomas Dewey, because for at least {he last 40 years the main "organizer" and leave Luciano's good friend Meyer Lansky in of organized crime in the United States has been a section control of the Eastern syndicate. of the U.S. government itself. The FBI, the Williams Dewey and Lansky are connected through a lawyer hearings showed, had no effective control over Wein­ named George Z. Medalie. Dewey was the protege of berg. The reason is that the Bureau does not merely use Medalie, who also had worked for Lansky'S mentor in such criminal garbage, it makes alliances with it. Each crime Arnold Rothstein. The nascent alliance they partner in this "special relationship" has his own dirty represented-between an East Coast anglophile power end; the only common denominator is the history of how elite and organized crime-was put on a firmer footing British intelligence and American anglophile networks during World War II. shaped U.S. law enforcement. When Operation Underworld was launched, Dewey An early chapter in this story is the Office of Naval fished Luciano out of the Dannemora, New York ' Intelligence's Operation U nderworld, the ostensible pur­ penitentiary for the project. A special unit of the Office pose of which was to employ the Sicilian Mafia for of Naval Intelligence (ONI) called B-3, was created to protection against sabotage during World War II and in run the project. ONI recruited Dewey's "crimebuster" the invasion of Italy (see EIR, April 20, 1982). One of the staff into the B-3 unit. Meyer Lansky, along with his fruits of this collaboration was the New York-New Jersey lawyer Moses Polaskoff, served as the interface between Waterfront Commission. the B-3 unit and the Eastern syndicate, handling all The Waterfront Commission came to the public's liaison between the government and the imprisoned attention most recently on May 22 in a New York Post Luciano as well. This placed Lansky in an unprecedent­ editorial which urged the New York State Legislature to ed position vis-a-vis the government and the mob. watch a re-run of the 30-year-old film On the Waterfront, that they might recall the "pervasive corruption and Modern times gangsterism that long dominated the New York-New In the changing character of organized crime in the Jersey waterfront under the joint auspices of the mob­ post World War II period, "business genius" Meyer ridden International Longshoremen's Association and Lansky played a major role. While not precisely an shipping interests," and not succumb to the latest annual equal-opportunity employer, the syndicate became effort of the "unholy ILA-industry combine" to shut much more professional in matters of investment and down the Waterfront Commission. The pro-British, Ru­ finance, and joined Uncle Sam in a number of limited pert Murdoch-owned Post went on to recommend that partnerships. Improved money-laundering techniques the ILA and the New York Shipping Association bring enabled the mob to systematically integrate its opera­ their proposals to the Commission itself, and lauded the tions with legitimate businesses as well as trade unions. latter for "curbing" organized crime on the waterfront. Lansky extended his legitimate gambling enterprises Were the truth about the Commission known, the beyond Cuba in the Caribbean into the development of public would join the ILAjindustry campaign to shut it the Bahamas as a gambling capital. The flagship effort down. in the Bahamas was the creation of Paradise Island, The history of this operation-along with much else owned by Resorts International. The parent company that EIR will detail in future articles-begins with the to Resorts was the Mary Carter Paint Company-in first big success of "crimebuster" Thomas E. Dewey in which Thomas E. Dewey was a major stockholder. EIR July 27,1982 National 59 © 1982 EIR News Service Inc. All Rights Reserved. Reproduction in whole or in part without permission strictly prohibited. Lansky in particular directed the Eastern syndicates the Commission's targets have been primarily low-level into gambling and narcotics; those families are today union officials. identified with the so-called Sicilian Connection respon­ The Commission appears to be more interested in sible for bringing into the United States the bulk of the union-busting than crime-busting. The agency's efforts heroin affecting the Eastern seaboard and the Midwest. increased noticeably when it was officially incorporated The waterfront and the airports became crucial trans­ into the Justice Department's Organized Crime Strike shipment points along the international heroin trail. Force. The Commission is credited with having lent invaluable assistance to the FBI's Unirac ("union-rack­ On the waterfront eteering") investigation which later branched out into Dewey, meanwhile, had not remained inactive on Brilab. The Commission is said to have provided intel­ the "law enforcement" side of the partnership. In the ligence on criminal activities along the entire Atlantic late 1940s a major campaign had been led by Father seaboard and in the Gulf ports! John M. Corridan, SJ., to expose the horrors of New York waterfront operations. The media lent their voices. Grab for metropolitan airports This paved the way for the establishment of the New In 1970, the Waterfront Commission attempted to York State Crime Commission by then-Gov. Thomas extend its jurisdiction to include the metropolitan air­ Dewey. The Crime Commission was to investigate ports in the bi-state area. The move was made based on allegations of degrading work conditions, union cor­ the Commission's assertion that it could do for the ruption, and the impact of millions of dollars in pilfer­ airports what it claimed to have done for the docks: ing on the New York-New Jersey economies. eliminate organized crime. The Commission's grab for The Crime Commission's investigation concluded in the airports was accompanied by a press campaign 1953. As expected, it recommended the creation of an concerning mob-domination of predominantly Teams­ agency to license and regulate dock labor and to ter unions at the airports. Although the legislation continue investigation into union corruption and organ­ enabling the takeover was passed in both states, the ized crime activities in the bi-state ports. According to Airport Compact remains stalled in the U.S. Congress, the Waterfront Commission's first annual report, Dew­ where it is considered an issue "too hot to handle." ey's Crime Commission also concluded that a contin­ In a strange twist of events, the man credited with uation of waterfront crime threatened a "catastrophe" putting the Airport Compact on hold was assistant to to the port's economic supremacy, which would be a the executive director of the Waterfront Commission, "crippling" blow to the New York-New Jersey metro­ James J. Davitt. Davitt testified just one day before the politan area and in fact the entire Eastern seaboard. The close of the congressional hearings because, he said, Waterfront Commission of New York and New Jersey "many pressures both subtle and blatant would have was signed into law by President Eisenhower on Aug. been exerted" on him. 12, 1953. Davitt's testimony was a shock to all. He had been The Commission was given the power of life and one of the four-man team from the Commission which death over every man and agency that worked on the wrote the enabling legislation. Davitt claimed that he waterfront, for in order to work or operate a company had "lost faith" with the Waterfront Commission; he on the docks it was necessary to hold a license from the charged that of 100 major theft cases, "not one had Commission. The Commission was armed with the been solved." He accused then-Commissioner Joseph power to hold licensing hearings, grant witness immu­ Kaitz of conflict of interest for practicing law while at nity, conduct criminal investigtions, compile intelli­ the same time being a law enforcement agent. Davitt gence files, and exercise police powers in both states. testified that the Commission had "nai'vely" helped a The staff of the Waterfront Commission was drawn Mafioso obtain a Certificate of Good Conduct from the extensively from the Crime Commission itself, which in New York State Parole Board, thus enabling the con­ turn had absorbed not only the ONI's B- 3 unit but also victed criminal to hold union office. the remnants of Dewey's special "racket-busting" Ironically, Davitt's charges led then-Rep. Edward squads in the District Attorney's office, as well as their Koch (D-N.Y.) to tell his congressional colleages that it files and informant networks. was "clear that unless and until the present e,xecutive director William Sirignano and Commissioner Joseph Crimefighters Kaitz are removed, we cannot expect the New York­ Despite its high-powered crew of crime-fighters, the New Jersey Waterfront Commission to do an adequate Commission's record has been dismal.
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