The Beer Baron of the Lower East Side

“Since his first act of lawlessness forty-six years ago, [Waxey Gordon’s] contempt for authority manifested by progressively more serious criminality, has been like a malignant cancer, weakening the dignity and good order of the community.”
—Judge Francis L. Valente, Dec. 13, 1951

Short, stocky, thick, and muscular, Irving Wexler (or Isaac or Isidore Wechsler)—better known as “Waxey” Gordon—sporting his fashionable fedora and fine suits, epitomized the New York City and Chicago gangsters of the 1920s and ’30s. In a “profession” where many men died young in a hail of bullets or were sent to jail for half their lives, Gordon was a survivor. His criminal career endured for nearly 50 years, from 1905 to 1952. In that period, he had some close calls and made more than a few enemies. He spent a total of 14 years in prison; the longest stretch was from 1933 to 1940; when he died in late June 1952, he was six months into a 25-year sentence. Still, his rise to the “rank of racket overlord,” as The New York Times described him, was not accidental; it owed to a sinister guile, persistent greed, and brazen corruption.

Born in January 1888, Wexler grew up on the Lower East Side near Forsythe and Chrystie streets, the son of Louis and Beila Wechsler, impoverished Jewish immigrants from Lvov (Lviv), then under the control of the Austro-Hungarian Empire (today in Ukraine). Louis was an expressman, or trucker. He and Beila had four children; Irving was the eldest. When Wexler was 10 years old, his mother died and his father later remarried. Irving did not get along with his stepmother. He was soon drawn to crime, as a pickpocket. He was so adept at it that he acquired the nickname “Waxey” (also spelled “Waxie” and “Waxy” in the press) because, as crime writer Carl Sifakis noted, “he could slide a victim’s wallet out of his pocket as though it were coated with wax.” The surname “Gordon” was merely one of his many aliases, as in “Harry Gordon.” He also passed himself off at various times as Harry Brown, Benjamin Lustig, Benjamin Lester, Harry Middleton, Louis Weschster, Harry Wechsler, and Harry Burns.

His first run-in with the police was when he was 17 years old: In September 1905, he was sent to the Elmira Reformatory on a charge of grand larceny. During the next few years, he was arrested several more times and spent more time in Elmira, as well as nearly two years in Holmesburg Prison in Pennsylvania following another grand larceny conviction in Philadelphia. The authorities believed his name was Harry Middleton.

When he returned to New York in late 1912 and moved into a tenement near the corner of Delancey and Forsythe streets, he joined Dopey Benny Fein’s East Side gang. This was soon after Benny had assumed leadership of the gang following the murder of his predecessor, Big Jack Zelig. For a time, Gordon served as one of Benny’s thugs, breaking arms and kneecaps (or worse) as required in his “work” for the Jewish labor unions. As Abe Shoenfeld, chief investigator for the New York Kehilla’s Bureau of Social Morals, later noted, Gordon was “a gangster and a tough man … He broke many a poor Jew’s head and was always a bully in the mob.”

In January 1914, Gordon was involved in a shootout near the Arlington Dance Hall on St. Marks Place in an altercation that pitted Benny’s men against their chief rivals from Five Points led by Jack Sirocco and Chick Tricker. None of the gangsters was killed, but a 65-year-old court clerk named Frederick Strauss was shot and killed as he was caught in the crossfire. Witnesses placed Gordon (called Louis Wechster) at the crime scene and he, along with Benny and several other gang members, were arrested. Insufficient evidence, however, led to the release of Gordon, Benny, and the other men charged.

As was to be constant throughout his life, Gordon could not stay out of trouble or stay honest. In July 1915, he was arrested as he was spending a relaxing day swimming with a few friends at the beach near the foot of East 96th Street. The police charged him and three other men with having invaded a merchant exchange and wholesale five months earlier, holding the owner at gunpoint, and robbing him of cash and jewelry. For this crime, Gordon was sentenced to two-and-half years in Sing Sing prison. Following his release, he and eight others were again put on trial for the Strauss murder. Based on information provided by Joseph “Jo the Greaser” Rosenzweig, who was serving a 10-year sentence in Sing Sing for murder, Gordon was now alleged to have been one of the gunmen who hit Strauss. Yet, again, Gordon’s luck stood: After five hours, the jury acquitted him.

In early December 1913, Gordon married Leah Goldman and they had three children. Being a husband and father did not stop his life of crime, however. In 1917, he was arrested twice for committing assault and battery, though on both occasions the charges were dropped. While he peddled opium and other narcotics, which made him some money, the opportunity to acquire even more wealth soon presented itself.

Congress’ ratification of the 18th Amendment to the U.S. Constitution early in 1918, and the subsequent ratification by a sufficient number of states, led the way for Prohibition to begin on Jan. 16, 1920. In May 1919, Congress had passed the Volstead Act, named after one of its authors, Republican Congressman Andrew Volstead of Minnesota (although Wayne Wheeler, the leader of the Anti-Saloon League, had drafted the bill) to enforce the act.

We now know that the so-called “noble experiment” was an abject failure. For millions of Americans, especially those who lived in large urban centers like New York, Chicago, and Detroit, demand for liquor and beer was not curtailed; in fact, it increased, as did the prices. A bottle of Scotch whisky, which before 1920 cost a few dollars, now could run as high as $16 for a quart. Champagne was even pricier, at anywhere from $25 to $40 a bottle. In Manhattan and elsewhere, the booze flowed at private clubs and speakeasies. Liquor was easily available from Canada, where it remained legal to manufacture and drink, as well as the West Indies and Europe.

The fortune to be made from a pricey black liquor market during Prohibition was evident immediately, particularly to someone as cunning as Arnold Rothstein, a high-roller gambler born in New York City in 1882 to a middle-class Jewish family. (Rothstein was most famous for allegedly fixing the 1919 World Series by paying off the members of the Chicago White Sox baseball team, and made for himself more than $250,000 by wagering on their opponents, the Cincinnati Reds.) Rothstein understood more than most of his underworld colleagues how much money there was to be made by supplying Americans with whiskey and beer. Among those who came under Rothstein’s wing during the 1920s, and became gangster kingpins in their own right (especially following Rothstein’s murder in 1928), were: Meyer Lansky (originally Maier Suchowljansky), who was born in 1902 in Grodno, then part of the Russian Empire, before immigrating to the U.S. and settling on the East Side with his parents in 1911; Benjamin “Bugsy” Siegel, who was born in 1906 in Williamsburg, Brooklyn, to struggling Jewish immigrant parents who had immigrated from Galicia in the Austro-Hungarian Empire; and Charles “Lucky” Luciano (originally Salvatore Lucania), an Italian immigrant who came with his family to New York in 1906 at the age of 8 and resided on the East Side. All three, as well as Rothstein, played pivotal roles in Waxey Gordon’s career as a bootlegger and beer baron—as partners and bitter rivals.

In 1920, working with “Big Maxie” Greenberg, most recently from St. Louis, Gordon decided that bringing in whiskey from Canada on boats across the Great Lakes or by cars in remote rural locations along the U.S.-Canadian border and then transporting it to speakeasies in New York and elsewhere was a sure moneymaker. For financing of this venture, Gordon and Greenberg approached Rothstein. Nicknamed “Mr. Big” and “The Big Bankroll,” Rothstein agreed to provide them with the $175,000 they needed to acquire speedboats, but only if he became their partner, among other financial demands he made.

Based in offices at the Knickerbocker Hotel and Building on West 42nd Street, Gordon posed as a real estate investor. Business, to say the least, boomed. By 1925, he had made millions of dollars. His wife and children now lived in a 10-room apartment decorated with fine furniture on the Upper West Side with a monthly rent of $6,000. He also owned a summer home in Bradley Beach, New Jersey, Gordon had expensive cars and wore $225 suits (reportedly made by the same tailor who cut gangster Al Capone’s suits). Yet federal justice officials were watching him. Near the end of September 1925, agents raided Gordon’s offices and arrested 13 people, including Maxie Greenberg. The arrest warrant could not be served on Gordon because a week earlier he and Leah had boarded the White Star liner Majestic on a trip to Europe. According to later reports, the Wexlers/Gordons were occupying the ship’s most luxurious suite. Upon his return to the U.S., Gordon was arrested as well.

The five-month investigation into Gordon and Greenberg’s smuggling operations was based on the seizure of one of their ocean steamers on its way from Lunenberg, Nova Scotia, to New York Harbor. Federal agents discovered 500 cases of liquor hidden amid the cargo of lumber the ship was transporting. The authorities’ star witness in the case was Hans Furhman, a disgruntled former rum-runner who was not satisfied with his financial cut. He provided information about Gordon and Greenberg’s shipments. Another key witness was David Baum, a gunman and whiskey smuggler, who also had a dispute with Gordon and Greenberg.

Yet, the case against Gordon, Greenberg, and their men soon evaporated. Labeled a “squealer,” Baum was found murdered in his Packard limousine, which had been abandoned at 98th Street and First Avenue two days after the raid on the Manhattan offices. Next, in early February 1926, Furhman, who was prepared to testify, was discovered dead in his room at the Hotel Aristo on Sixth Avenue and 44th Street. The medical examiner concluded that he committed suicide by shooting himself in the head. His wife, however, insisted that he had been murdered.

After these legal troubles had ended, Gordon decided to cease his smuggling operations and reinvent himself as a beer manufacturer. The Volstead Act stipulated that the only beer that could be legally sold during Prohibition was low-alcohol beer (0.5% alcohol) or “near beer,” as it was called. This provided Gordon, Greenberg, and another associate, Max Hassel, with a loophole they could exploit. With Gordon in charge, they set up breweries in New Jersey and eastern Pennsylvania. These plants did indeed produce the low-alcohol beer, which was shipped and sold. But using underground pipes, hoses and sewers, they devised a system in which real beer—“high-powered” beer as it was referred to during Prohibition—was manufactured and bottled in secret plants located not too far from the breweries. To ensure the real beer reached its final destinations in Manhattan and other cities, Gordon entrusted Abner “Longy” Zwillman and his team of Jewish and Italian gangsters to guard the liquid merchandise.

To point out that Waxey made a lot of money from his illicit beer business is an understatement. It was later calculated by the Bureau of Internal Revenue (as the IRS was known until 1953) that in 1930 and 1931, at the outset of the Great Depression when unemployment soared, Gordon grossed a total of $6.47 million, of which he netted $4.55 million (about $82.6 million today). In a poor decision that was soon to cause him serious legal problems, he declared that in 1930 he only earned $6,456 and paid $10.76 in income tax; in 1931, he claimed an income of $35,000 and paid $2,065 in tax. Gordon ignored at his own peril the fact that in the spring of 1931 the bureau had ensnared Al Capone on tax evasion charges. Capone was found guilty, received a 10-year prison sentence, and was fined $50,000 (he died in prison in 1947 suffering from brain dementia caused by syphilis).

By the early 1930s, during the last few years of Prohibition—which was repealed in December 1933—Gordon and Lansky came to detest each other. The feud might have been related to Gordon’s belief that Lansky, Siegel, and Luciano had hijacked one of his liquor shipments. On one occasion, Gordon and Lansky had a physical altercation that Luciano had to break up. Lansky could have ordered a “hit” on Gordon, yet instead they came up with a clever scheme—or at least that is what Luciano supposedly related three decades later in a series of interviews he gave a few years before he died in January 1962. While Luciano did not have as big a problem with Gordon, his loyalties were with Lansky. Utilizing Lanksy’s brother, Jake “the Hunchback,” as a go-between, the two men provided sensitive information to Internal Revenue agents about Gordon’s financial dealings. This information made its way to Thomas Dewey—the future New York state governor (1943-54) and Republican presidential candidate in the 1944 and 1948 elections—who in 1933 was a young federal attorney for the Southern District of New York. He had already been involved in prosecuting the tax evasion case against Capone. Dewey would have been the only other person to know if Lansky and Luciano had sold out Gordon, though he never addressed the issue publicly.

By April 1933, Gordon knew that Dewey was coming for him, but he figured his lawyers would get the case dismissed, or he underestimated Dewey’s resolve. On the afternoon of April 12, Gordon, Greenberg, and Hassel were meeting at a hotel in Elizabeth, New Jersey, south of Newark, when their enemies targeted them. The assassination order most likely was given by Dutch Schultz (Arthur Flegenheimer), a young German Jewish mobster. Schultz objected to Gordon’s encroachment on his liquor and beer territory and was at the time feuding with one of Gordon’s chief lieutenants, Charles Sherman (Charles Shapiro), who was later murdered. The attack at the hotel was the closest Waxey came to be killed throughout his long career as a gangster. Two gunmen found Greenberg and Hassel together and shot them dead. Hearing the commotion, Gordon escaped by leaping from a window.

Three weeks later, following a tip “from the underworld,” federal agents found Gordon and two associates at a Catskill Mountain area hunting lodge, 12 miles from Liberty, New York. Led out of a cottage on the property, Waxey had a stubby beard. As news photographers at the scene snapped their cameras, he put his hands in front of his face. “Hey, if I knew you were going to take my picture,” he said, “I’d have taken a shave.”

By the time of his arrest, Dewey had indicted Gordon on income tax evasion for concealing income of approximately $1.61 million for 1930 and 1931, though the final calculations were higher. Despite the fact that several witnesses who were scheduled to testify against Gordon mysteriously vanished or were found dead over the next several months, Dewey made a strong case that Gordon had cheated the government out of hundreds of thousands of dollars of tax payments (the final tally was $1.8 million for the two years in question). “By his own admission [he is] a thief, a robber, a pickpocket a professional criminal—a man so low that although he had a colossal income in those years (1930-31) he paid the government a pittance and left the support of the government to the honest people of the United States,” stated Dewey. On Dec. 1, 1933, the jury took only 51 minutes to find Gordon guilty of tax evasion. He was given a 10-year prison sentence—a pronouncement that, according to the press, made Gordon’s jaw drop—and fined a total of $80,000.

Less than a week later, Gordon suffered another tragedy when his 19-year-old son Theodore was killed in a car accident. The boy was on his way to New York from the University of North Carolina in Chapel Hill to plead for a reduction in his father’s sentence. At the funeral in the Mount Hebron Cemetery in Flushing, Queens, “tears streamed down Waxey Gordon’s cheeks,” The New York Times reported, as he recited the Kaddish, while the federal marshals who had accompanied him kept a watchful eye.

During the next few years, various appeals were made on Gordon’s behalf, but all were rejected. Moreover, as he served his time in prison, New York state launched a case against him for payment of an additional $625,630 in state taxes. After more than seven years, Gordon, who had behaved himself in prison. was released in late November 1940. He still owed the federal government more than $1 million, which he claimed he did not have. The government, in its wisdom, began charging him $6 a week—a payment rate that would have taken him 5,128 years to pay off the amount he owed.

Soon after Gordon was released, he declared that he was once again Irving Wexler and that he was retiring his criminal persona as Waxey Gordon. Given his sordid past, that was far from true. In need of cash, he did what he knew best: try to make money illegally.

Early in 1943, he pled guilty of having conspired with a partner to setting up a black market for sugar that was rationed during WWII. He was forced to serve at least another year in prison for that scheme. A few years later in November 1947, he was caught by undercover detectives attempting to sell stolen watches and jewelry. He only escaped justice in this case when the jewelry company that had been robbed could not positively identify the watches and other items.

His worst transgression occurred in 1951. Agents of the federal bureau of narcotics had been surveilling him and three other men for about eight months. In August, he and his partners were arrested with heroin in their possession and charged with trafficking the drug. At 63 years old, Gordon had no desire to return to prison. He urged the lead detective, John Cottone, to put him out of his misery. “Please kill me John—shoot me,” pleaded Gordon. “I’m an old man and I’m through. Don’t take me in for junk. How else can I live? Let me run, John, and then you shoot me.”

The detective, of course, refused and Gordon ended up in court one last time. It was determined that going back to 1909, this was his fourth felony and therefore under the Baumes Law he was to receive the maximum sentence under the law. Judge Francis L. Valente did exactly that. Calling Gordon a “malignant cancer,” he declared that he was an “anti-social creature … who should be isolated in prison for the remainder of his natural life.” He sentenced him to 25 years. But Waxey was not well. Six months into his life sentence, he was transported to Alcatraz where he was scheduled to testify in a federal narcotics trial in San Francisco. On June 24, he died from a massive heart attack in the prison’s hospital.

Waxey Gordon was indeed “one the prohibition era’s most sinister underworld figures,” as The New York Times dubbed him. He was also part of the generation of Jews born in the Lower East Side during the late 19th century that moved beyond the immigrant neighborhood to seek other nefarious opportunities. His criminality—as Judge Valente noted—became “progressively more serious.”

A career criminal, he knew no other way to live his life.