Today Arnold Rothstein is remembered by students of crime as the so-called mastermind of baseball's worst gambling disgrace, the Black Sox scandal of 1919 when the World Series was fixed. Rothstein was a multimillionaire gambler, but he was much more than that. Indeed, he stands as the spiritual father of American organized crime.
He was known by many nicknames—Mr. Big, the Big Bankroll, the Brain, the Man Uptown, the Fixer. All were accolades to his importance in the world of crime, to his connections with the underworld and the upperworld of police, judges and politicians. Although he operated strictly in the background, Rothstein may well have been the most important criminal of his era.
At various times he financed the criminal activities—in fact, usually masterminded them—of the likes of Waxey Gordon, Dutch Schultz and Legs Diamond. He was the early tutor of Lucky Luciano, Meyer Lansky, Frank Costello and Johnny Torrio. (Torrio never returned on a visit to New York from Chicago without having discussions with Rothstein.)
It is generally acknowledged that Torrio, and later Lansky and Luciano, learned from Rothstein the joys of forming alliances, regardless of ethnic considerations, not only with underworld confederates, but also, above all, with those who could perform the political fix. The dollar, Rothstein pointed out, had only one nationality, one religion—profit.
Rothstein became known to all as the man who had influence everywhere and could fix anything. He could clear virtually any illegitimate activity through his political and police contacts. During Prohibition, a later study showed, Rothstein intervened in literally thousands of bootlegging cases that went to court.
Of a total of 6,902 liquor-related Rothsteinera cases, 400 never even came to trial while another 6,074 ended in dismissal. Most of the credit had to go to Rothstein whose credentials with Tammany leader Charles Murphy were impeccable. Rothstein's record in prostitution and gambling cases was equally as impressive.
Rothstein and Murphy altered the way graft was collected in New York. Up until their time the standard procedure was to use police as major graft collectors, allowing the politicians to remain somewhat aloof from the process. This was possible when the politicians, the hub of all illegal activities, bought the criminals and used them as they wished.
With the new wealth of Prohibition, the central power shifted to the criminals—and above all, Rothstein. He could buy the political leaders, and insisted on direct payoffs to eliminate possible police defections. The police got separate graft but they now became secondary to the power of the criminals and the politicians.
When the criminals wanted changes in police procedures, the politicians saw that those changes were made. Is it any wonder that Rothstein in 1925 served as the inspiration for Meyer Wolfsheim in The Great Gatsby and later on for Nathan Detroit in the musical Guys and Dolls?
The Rothstein style was to hang back, to remain in the background while still seizing a major portion of all loot. Prohibition, he realized, was too immense a field to be dominated by one man or even one gang, so he moved himself into the safest part of the racket, importation, the area most insulated from arrest. Through aides, he made agreements with European distilleries for supplies.
In that fashion he made himself immune to gangland assassination—if he was killed, the flow of good liquor would slow. He was simply too valuable to be allowed to die. (This was a lesson Meyer Lansky learned well, especially in gambling and the movement of money. The Mafia's later dependence on Lansky allowed him to move freely among the various gangs, indeed to be recognized as the ultimate power. That "Meyer is a Jew and has no vote" was a fiction maintained in the lower ranks of crime. The fact was that when the "Little Man" spoke, all the mobsters listened.)
Rothstein learned how to keep the various gangs content by apportioning supplies among them. By the mid-1920s, he had already started tapering off his interest in the booze racket, realizing Prohibition had to end some day.
He was already laying the groundwork for a number of criminal empires— gambling, labor racketeering, diamond and drug smuggling. In fact, Rothstein was thinking in terms of a national syndicate. Lansky and Luciano, who instinctively leaned that way, heard his message clearly.
But Rothstein, the Brain, self-destructed. Gambling obsessed him and he bet compulsively. He made huge bets, won some and lost more. In 1928, Rothstein played in one of Broadway's most fabulous poker games, one that lasted nonstop from September 8 to 10. At the end, Rothstein was out $320,000. That Rothstein could lose shocked the wise guys of Broadway, but not nearly as much as the fact that Rothstein welshed on the debt. He declared the game had been fixed.
On November 4, Rothstein was murdered at the Park Central Hotel. The prime suspects were the two California gamblers who had beat him in the game, Nigger Nate Raymond and Titanic Thompson. The case was never solved, and there have long been reports that the debt was merely a cover for the real motive of the murder, that an ambitious Dutch Schultz saw a chance to increase his own empire vastly by knocking off Rothstein.
Ironically, no suspicion ever rubbed off on Lansky and Luciano who profited most by Rothstein's demise. It was they who moved on his ideas for a new syndicate. They developed close ties with labor racketeers Louis Lepke and Gurrah Shapiro, who in turn reached understandings with Schultz and other Jewish gangsters. And they gained the support of the young mafiosi and other Italian criminals who eventually purged the old-line Mafia leaders Joe the Boss Masseria and Salvatore Maranzano.
Lansky and Luciano became the fathers of the national crime syndicate, and in many respects Rothstein's pivotal role was forgotten. Instead, his name is more widely recalled in constant retellings of the Black Sox scandal, and how he was alleged to have planned the fix by bribing several players of the Chicago White Sox to throw the World Series to the underdog Cincinnati Reds.
Supposedly, Rothstein financed the great baseball betting coup through exfeatherweight boxing champion Abe Atell, although no firm evidence supports this. It is known that he was approached for financial backing, and it is also known that, at least at first, he withheld agreement.
Rothstein probably didn't put up any money, realizing the deal was so good it would go through with or without him. So why should he pay out bribe money? Instead, Rothstein remained aloof, simply bet $60,000 on his own on Cincinnati, and won $270,000. That version surely reflects the real Arnold Rothstein.