Al Capone and the transformation of the IRS
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What events led to the Valentine's Day Massacre and its significance?
On Wait, Wait, Don't Tell Me, the NPR News Quiz, we've had some of the biggest stars in the world come on the show, but we don't ask them the questions everybody else does. You know, the ones they can answer. We ask them questions about things they don't know anything about. Some of them seem to enjoy the novelty. Join us for the show that always zigs when they say jump. That's NPR's Wait, Wait, Don't Tell Me, wherever you get your podcasts.
February 14th, 1929. Valentine's Day. Around 10 in the morning, a Cadillac pulls up to a garage on the north side of Chicago. Four guys jump out of the car. Two are dressed in police uniforms. Inside the garage, they find seven men, six of whom are members of a gang led by George Bugs Moran, who runs things on the north side. Cops come around all the time looking for a bribe, just the cost of doing business. Moran's men do as they're told, hand over their guns, line up against the wall. But then, suddenly, Thompson machine guns appear from under the coats of the cops, and they start firing. Seventy rounds later, Moran's men lie slumped on the ground in a pool of their own blood. The shooters get back in the Cadillac and drive away.
It turns out they weren't cops, and when the actual police arrive on the scene, they find one man barely still alive. When asked who had him shot, he replies, No one shot me. Three hours later, he dies. And the question remains— Who was responsible for this?
Newspapers around the country seize on this story, calling it the Valentine's Day Massacre.
The leader in Chicago's St.
Valentine's Day Massacre, turned by police the most dangerous man alive, was sought over the nation today. No arrests were made, but when George Moran is asked about it, he doesn't hesitate. He says, Only Capone kills like that. Alphonse Al Capone, his main rival in Chicago, also known as Scarface. There were other kingpins who were just as large, but Al Capone, man, he was like the poster child. Capone had moved to Chicago at the start of Prohibition in 1920. Suddenly, they take an industry that is big and lucrative, the alcohol industry in the U.S., and they make it illegal. And there's immediately a booming market for illegal alcohol. This is Joe Thorndyke, historian for Tax Analysts, a nonprofit provider of tax information.
And in places like Chicago, this was very evident. Chicago was an ideal place to build a bootlegging empire. A big city, centrally located, with notoriously corrupt law enforcement. But it was also true in almost every big city. Prohibition didn't start organized crime. The early 1900s, there was this culture of corruption. So they already had the infrastructure. This is Paul Camacho. He's a retired special agent for the IRS Criminal Investigation Division. And he's on the board of directors at the Mob Museum in Las Vegas. But Prohibition came in and it was like the goose that laid the golden egg. These people get really rich. They could buy the protection of police officers, of prosecutors, of judges.
They could also threaten all of those same people with violence. They had their fingers on the levers of power. Al Capone really knew how to pull those levers. And was essentially considered untouchable.
How did Prohibition create a boom for organized crime?
You couldn't get people to testify. You couldn't keep people alive who were going to testify. There had been organized efforts to take him down for years. At one point, there was even a $50,000 bounty on Capone's head, the equivalent of close to a million dollars today. But no one had ever succeeded. Just days after the Valentine's Day massacre, the gruesome details and photos still fresh in people's minds. A new president took office named Herbert Hoover, determined to clean up the streets of gangland Chicago.
Herbert Hoover made it his top priority to get Capone.
And he caught wind of someone in the Treasury Department at the IRS who might be the guy to do it. Elmer Irie. So he calls up Elmer's boss, the Treasury Secretary, Andrew Mellon, and tells him, Direct Elmer to get Capone. If you're thinking, OK, wait, let me get this straight.
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Chapters
8 chapters
1
What events led to the Valentine's Day Massacre and its significance?
0:00–4:07
2
How did Prohibition create a boom for organized crime?
4:07–8:25
3
What role did the IRS play in hunting down Al Capone?
8:25–12:15
4
How did Elmer Irie's approach transform the IRS?
12:15–16:10
5
What legal changes occurred regarding taxation of illegal income?
16:10–19:59
6
How did the Great Depression influence tax policies in America?
19:59–23:50
7
What was the impact of the Victory Tax during World War II?
23:50–28:32
8
How did public trust in the IRS evolve through the years?
28:32–52:46