Much is made of the elimination of the Mustache Petes, the old-line mafiosi, by Lucky Luciano as a vital prelude to the establishment of the national crime syndicate. But the same sort of purge had to be carried out against Jewish gangsters who would not fit the emerging scheme of things.
Jacob “Little Augie” Orgen, one of the last bigtime, pre-syndicate Jewish mobsters, had no place in organized crime. When Little Augie was murdered in 1927, his garment industry rackets fell logically to the notorious Louis Lepke, a protégé of Arnold Rothstein, considered to be the greatest criminal mastermind of his day and the spiritual godfather to Meyer Lansky and Lucky Luciano’s national crime syndicate. Rothstein viewed Little Augie as a mindless criminal who only thought of extracting the biggest profit at the moment, not of what was best in the long run. Such a failing proved the death of Little Augie.
Orgen had been schooled as a labor slugger in the years before the outbreak of World War I in the organization of Dopey Benny Fein, the foremost labor racketeer of that period. Fein worked both sides of the street, carrying out sluggings and murders for employers seeking to stop the unions or introduce strikebreakers, or for the unions seeking to recruit new members or terrorize strikebreakers. Sometimes Dopey Benny worked for both sides in the same dispute, an arrangement that impressed Little Augie.
    |
By 1915, police action put Dopey Benny out of business, and labor slugging was virtually nonexistent over the next four years. But in 1919, Little Augie made a comeback in the labor slugging racket, and union activities picked up. He organized his own gang, called the Little Augies, and contended with the forces of the much larger Kid Dropper organization, then in control of most of the slugging rackets. By 1923, Little Augie numbered among his troops the young Louis Lepke, Lepke’s gorilla-like sidekick, Jacob “Gurrah” Shapiro, and another rising gangster, Jack “Legs” Diamond.
When Little Augie masterminded Kid Dropper’s murder, he became top dog in the labor slugging field. Unfortunately, the field became less lucrative because of police enforcement and because many more sophisticated labor leaders switched away from violence to achieve their ends. Lepke, advised by Rothstein, explained to Little Augie that they should drop the slugging tactics and instead penetrate the local unions and take control of them. Then, besides skimming the local treasuries, they could extort money from employers who wanted labor peace.
The take from such a setup would be much greater than what they got out of simple slugging assignments, but Little Augie was not convinced. He wanted an immediate return for his criminal time. He insisted on sticking with the old ways and switching part of the operations to bootlegging. Taking the long view, Lepke realized Prohibition could not last forever, and he was interested in building a permanent empire. Little Augie now stood in his way.
In October 1927 Little Augie was walking along a street on the Lower East Side with Legs Diamond, his personal bodyguard. A black touring car pulled up. There were four men inside. Gurrah Shapiro jumped out, firing a gun. Louis Lepke from behind the wheel also opened up. Diamond was shot several times but survived. Little Augie fell dead with a bullet in the head.
Little Augie was buried by his father, a highly religious Jew, who ordered that the coffin nameplate read: JACOB ORGEN Age 25 Years Little Augie was really 33, but his family had considered him dead since 1919 when he had returned to a life of crime and organized the Little Augies.
Lepke and Shapiro went on to organize the labor extortion field.
