Investigation of So Called "rackets".

pleasure, every service we employ the payment for these is made harder because of the added tribute imposed by the underworld.

Various schemes are used to coerce the business man, actually to compel him to pay for the privilege of operating his business. Money is poured out for so-called "protection." By threat of violence to person or property, tribute money is extracted from the victim. He is compelled to join some sort of an organization if he is to be unmolested in his lawful pursuits.

Even though he may be the unwilling victim of this vicious system, he seems obliged to contribute if he is to keep his head above water. Men moral and upright in all their other dealings become accessories to crime in order that their children may have bread. They pay tribute and hold their tongues because they dare not do otherwise.

This situation has reached the ears of the United States Senate. A special committee of which I am chairman has been directed to investigate rackets and racketeering. The other members of the committee are Senator Vandenberg of Michigan and Senator Murphy of Iowa. It is our duty to report to the Senate the results of our investigations and, if we consider it desirable, to recommend remedial legislation.

It is because of this Senate action that we are having the public hearings scheduled for today and tomorrow. We have no jurisdiction over activities which are purely local. Our jurisdiction is limited to interstate matters.

We have asked police officials to appear on the first day. We want them to advise us regarding the crimes of racketeering and kidnaping. We desire to know how these problems appear to the police.

Tomorrow we shall challenge the legal profession to find remedies for the defects the police authorities present today. We hope you will point out frankly and fully whatever your experience has determined to be factors in the failure of crime control.

May I say for myself that with my present knowledge I have no fault to find with the police. There are individuals who cannot be trusted but, by and large, the ploice of America are honest, trustworthy men. It is in this spirit that we ask your cooperation today. The public will back you in your expressions of opinion and in your criticisms, if you have any, of present-day administration of justice. I am confident your plainly stated views will be hailed by every lawabiding citizen.

Unquestionably, the laws need strengthening and court procedure requires improvement. If you agree to this statement, the committee will be greatly benefited by your suggestions as to what should be done.

A rat will find somewhere an opening through which he can enter a house. It is certain the rats of the underworld have found ways to crawl through the meshes of the law and to carry on their slimy business in spite of your ardent desire to stop them.

Why cannot these protective rackets and terrifying kidnapings be controlled?

Until all men become moral, there will be crimes and criminals, of course. But in the meantime, how can we reduce to the minimum these attacks upon the happiness and welfare of the American people? Our committee has had many suggestions and received an endless number of plans to end racketeering. Many believe the penalties for such crimes as we are considering are too light. Martial law, life

imprisonment, death at sunrise-all these forms of punishment have their advocates. We listen, of course, to all suggestions.

What is your attitude toward the control of firearms?

Since the end of the World War we have imported into the United States more than a million pistols. Almost half that number, of domestic manufacture, are sold annually. Should any restriction be placed on the sale of firearms?

Eighty-seven submachine guns made in New York have been found in private hands in Chicago. Why should their manufacture and transportation be permitted except for use by military and other authorities under strict supervision?

Statistics show that of the homicides in the United States, firearms are responsible for 71 percent. In England they are used in 10 percent of slayings; in Australia, 17 percent; in Japan, 1 percent. Do these figures mean anything in forming an opinion as to what we should do about the weapons of crime? We welcome your comments on this subject.

We are particularly anxious to know why the protective and other rackets continue to exist and apparently to grow in numbers and strength.

Is it because you have not men enough on the police forces of States and localities? Do you need more money for personnel and equipment?

I should like to have you state frankly what part an aroused public opinion might play in giving the police better support. If perchance some courts are not now sympathetic to your efforts, would these courts be responsive to public opinion?

The courts are the cornerstone of our liberties. It is alleged that some of them fail to function in such manner as to guarantee those liberties. Nobody more than the police can possibly know what the courts are doing or not doing in the control of racketeering. Unless they uphold the hands of our peace officers, the police morale is sure to suffer.

Unless there are adequate sentences and which are made effective, arrests will hold no terror. There can be no doubt that celerity in the apprehension of the criminal and certainty of immediate court action, will make many an evildoer pause.

The police have every opportunity to observe the jury system. Have you found anything painfully defective in it? Are juries properly chosen and are jurors protected against intimidation or other improper approach?

We are particularly anxious to know how much the courts and prosecuting attorneys may be responsible for the failures of conviction. It is assumed that the cases are worked up by the police and turned over to the prosecuting officers and the courts with every expectation of successful termination. Are you thwarted frequently by faulty presentation or an unsympathetic court?

Needless to say I am not so naive as to believe these questions will be answered in just the way the committee might wish. I ask them, however, in the hope that some ex-police officials may answer them fully and freely. It will be interesting to get at the bottom of the

facts.

I have left for the last, the question that is most important to the committee. I refer to the larger part the Federal Government may have in the apprehension and trial of racketeers and kidnapers.

INVESTIGATION OF SO-CALLED "RACKETS"

Part I

MONDAY, AUGUST 14, 1933

UNITED STATES SENATE,

SUBCOMMITTEE OF THE COMMITTEE ON COMMERCE,
New York City

The subcommittee met at 10:30 a.m., at the Bar Association, 42 West Forty-fourth Street, New York City, Senator Royal S. Copeland, chairman, presiding.

Present: Senator Copeland, chairman and Col. Franklin S Hutchinson, chief of investigation.

(The committee thereupon proceeded to the consideration of Senate Resolution 74, which is as follows:)

[Senate Resolution 74, Seventy-third Congress, first session]

Whereas there have grown up in this country numbers of so-called "rackets", and newspapers carry numerous accounts of "beer rackets", "poultry rackets","milk rackets", "food rackets", "laundry rackets", "drug rackets", and other similar schemes for the exploitation, deception, and terrorizing of our citizens; and

Whereas the legitimate trade and commerce of the country, as well as the general welfare of our people, demand that the Federal Government take any steps within its power to suppress such practices: Therefore be it

Resolved, That the Committee on Commerce, or any duly authorized subcommittee thereof, is authorized and directed to investigate so-called "rackets" and "racketeering" practiced in the United States, and to report to the Senate as soon as practicable the results of its investigations, together with its recommendations, if any, for necessary remedial legislation through the exercise of the postal power, the power over interstate and foreign commerce, or otherwise. For the purposes of this resolution the committee, or any duly authorized subcommittee thereof, is authorized to hold such hearings, to sit and act at such times and places during the sessions and recesses of the Senate in the Seventy-third Congress until the final report is submitted, to employ such clerical and other assistants, to require by subpoena or otherwise the attendance of such witnesses and the production of such books, papers, and documents, to administer such oaths, to take such testimony, and to make such expenditures as it deems advisable. The cost of stenographic services to report such hearings shall not be in excess of 25 cents per hundred words. The expenses of the committee, which shall not exceed $10,000, shall be paid from the contingent fund of the Senate upon vouchers approved by the chairman, or by the chairman of the subcommittee if one shall be appointed.

The CHAIRMAN. I will ask the meeting to come to order because it is desired to broadcast the introductory addresses.

There is a growing conviction in our country that the administration of justice has fallen down. Our citizens cannot understand why racketeering and kidnaping appear to be on the increase.

The cost of crime is steadily advancing. Conservative students of the subject place the levy at varying amounts, even as high as 13 billions of dollars annually. Everything we buy, every purchased