The death of Cuban dictator Fidel Castro has provoked intense commentary, but one story we haven’t heard much about is when Castro’s rise brought on one of the biggest business reversals in the good American capitalism, and, now, why not a comeback?
In the 1930s, with cash aplenty from Prohibition and gambling illegal in many with the United States, American gangland syndicates burned with twin desires: new investment opportunities along with the chance of legitimacy.
New York-based racketeer, Meyer Lansky had planned to “go legit” when he would have been a straight A student in grade school. Lansky, whose previously undiscovered diaries I first wrote about in 2001, fulfilled his dream in Cuba. Few people understand that he bet just about everything he on that hot-blooded island.
Cuba became a mob magnet because every illegal dollar stuffed in a suitcase on American soil became clean when a courier touched down in Havana, ninety miles from the coast of Florida. This transaction was captured in The Godfather Part II when Fredo Corleone brought a real suitcase for eventual delivery to Lansky’s movie avatar, Hyman Roth. Mob bosses could legally own entire hotel-casinos in Havana and even report income on the Internal Revenue Service. They could also hold legitimate jobs. Lansky’s salaried title at crown jewel of gambling palaces, the Riviera, was Kitchen Director. And, ever fussy about his customers’ satisfaction, he genuinely kept a record of the food service, too.
Castro, born into wealth, cited the mob’s partnership with Cuban strongman Fulgencio Batista as a primary justification for his revolution against capitalism. To add insult to injury, when Castro descended upon Havana from your countryside in late 1958, his men literally brought pigs as well as other farm animals in to the fancy American hotel-casinos.
When I spoke regarding the historical novel I wrote about Lansky in South Florida a few weeks ago, I was approached not just by your children and grandchildren of Havana casino investors, but by passionate Cuban-Americans in exile who reminded me of their participation inside the pre-Castro Cuban economy. Doctors, lawyers, restauranteurs, tailors, artists, Castro destroyed their livelihoods along with their lives. Said one man, “Mr. Lansky drove rented Chevrolets and brought jobs. Fidel wore army fatigues for the cameras, but lived like a king, killed my buddies and neighbors, and place everybody underemployed. Fidel was the actual gangster. Everything Lansky did is legal now.”
From the 1930s to the late 1950s, Lansky directed the inflow of ten million dollars in the back alleys of American cities into Havana casinos much like the Riviera, the Nacional among others. That was serious money in those times. The Cuban mob casinos reached their zenith in the late 1950s diverting funds away from Las Vegas, which held rewards, but in addition risks.
While the Las Vegas casinos were mob-controlled, about the heels with the Kefauver congressional hearings for the rackets, they had to use under American law the place that the mobsters were considered “undesirables.” Most were banned not just from ownership but from even setting foot in casinos. Moreover, most in the mob’s income from Las Vegas came from “the skim,” cash illegally taken through the counting rooms and distributed, tax-free, to mob bosses. With a few exceptions, in Las Vegas, American gangsters were still criminals. In Havana we were holding shareholding partners and executives.
Lansky did not see himself like a gangster; he saw himself as a private equity finance manager from brutal origins who grew what was for being the mob’s biggest legal business: travel, tourism and gambling. He told friends and family he was no completely different from American moguls whose fortunes had had their provenance in illegal or questionable tactics. He named Rockefeller, Bronfman, Kennedy, Annenberg particularly. He secretly wanted but never received acceptance from the American power elite.
In Godfather II, Fredo’s suitcase never have got to Hyman Roth. In real life, those suitcases found their approach to Lansky who believed for days on end that American power would overwhelm the rebels. It would have been a bad bet.
When Lansky died in 1983, it touched off a frantic look for his assets, valued by a muckraking reporter within the vast sums. His family found none of computer for a simple reason: They didn’t own it. Lansky and his partners like Vincent “Jimmy Blue Eyes” Alo had bet your home on Havana and lost it all. If you want to see their fortunes, go to Google maps and appear the Riviera along with other hotels where they’d interests, assets that could be worth billions today. As Lansky said after fleeing Havana — and nearly dying of the heart attack in the oxygen tent in Miami Beach, “I crapped out.”
The irony would be that the very enterprises Lansky put in place in Cuba have become likely to be that nation’s economic redemption. (Legalized gambling, by some measurements, will be the fastest-growing industry in the world.) Some members of his family are searhing for to recover his Cuban assets. The merits of their legal claims are unclear, but one thing is certain: Lansky’s long-term bet that his investments could be worth big money was prescient. It was Castro’s half-century reign of terror he hadn’t factored into his prospectus.