The Lansky-Teamster Syndicate and the Deep State Global Drug Connection

Part 2 of "The Gray Alliance: How Ultra-Zionist Neoconservatism Took Over the American Deep State"

This article is the second part of my Gray Alliance series of articles, building on my own political science scholarship as well as the work of others—most notably Professor Peter Dale Scott. The articles serve a companion to the Gray Alliance podcast series that Max Arvo and I have released at the American Exception podcast. I have intentionally drawn from a small number of sources here—partly because there are so few authoritative and methodologically sound writers on these subjects. Consider each of these articles to be a working paper of sorts. I could—and eventually may—add more details on the source material. For now, I recommend that interested readers consult the cited texts (especially the works of Peter Dale Scott) for more details.

Unspeakable: The Lansky-Teamster Syndicate

In light of the material presented in Part 1, Robert Kennedy’s Enemy Within thesis assumes greater significance.[1] Kennedy formulated a theory of a Teamster-centric national crime syndicate with deep ties to Las Vegas and the “skim” from its casinos. Robert Kennedy was hated by J.Edgar Hoover; Hoover’s symbiosis with the mob was likely a major factor here. As covered in Part 1, the FBI and FBN denied the existence of any sort of national crime syndicate. After the 1950 Kefauver hearings, the FBN adopted an Italian mafia theory to account for the nationally coordinated activity of the mob. After Apalachin and the McClellan Committee, the FBI grudgingly came to adopt a theory of la cosa nostra, essentially the Italian mafia. Robert F. Kennedy went further with The Enemy Within, formulating a theory of a national crime syndicate centered around Teamster labor racketeering and including aspects like the “skim” from Vegas casinos, most of which went to Lansky.[2]

In the aftermath of Watergate—and after the US public finally saw the Zapruder film on television, showing that JFK was apparently shot from the front—the controversy over the JFK assassination reached a boiling point. The US House of Representatives decided to reinvestigate the assassination. In innumerable ways, the House Select Committee on Assassination (HSCA) was undermined and sabotaged throughout its existence. Despite this, the HSCA ultimately concluded that JFK was killed as the result of a probable conspiracy, likely including some combination of disparate mafia figures and Cuban exiles. Robert Blakey, the HSCA chief counsel, later went further, stating on the cover of his book, “Organized Crime Assassinated J.F.K.” Although Blakey had worked under RFK, he abandoned RFK’s Teamster-centered framework and simply rehashed the contrived la cosa nostra theory of US organized crime as ultimately an ethnic Italian enterprise. The weight of evidence suggests that the popular conception of an Italian mafia-dominated underworld is essentially a contrived mythological cover story.[3]

After spending a considerable time researching the deep politics of the US Empire, I surmise—based in part on reviewing and analyzing the work of Peter Dale Scott—that the clandestine US deep state has had as its perhaps most unspeakably sinister institution something that Scott has called the CIA global drug connection. In Deep Politics, Scott calls this “Operation X.” The FBI under Hoover, the FBN under Anslinger, and CIA Counterintelligence under James Angleton were all essentially protectors or accomplices of these operations which protected the nation-wide/international drug trafficking of the national crime syndicate over which Meyer Lansky presided.[4] For this reason, the absurdly suspicious Jack Ruby was the perfect choice to silence Oswald. He sat at the center of such explosive and lucrative state/Establishment criminality that the government could not possibly allow him to reveal the truth of Dallas. For one, such would expose as corrupt and criminal many prominent persons in business, politics, and organized labor. Secondly, it would damage US prestige in the “war of ideas” against the “Global Communist Conspiracy.”

In Deep Politics, Scott soberly gets right up to the heart of the matter. As to the question of why Ruby’s drug-informant status engendered so much cover-up, he offers a possible answer which I take to be essentially correct:

[W]hat is being protected is not a one-time arrangement, or even an arrangement through Ruby’s lifetime, but a more institutionalized arrangement between the mob and the government, initiated in the era of Hoover and Lansky but outlasting them and perhaps enduring down to the present.[5]

Meyer Lansky was the key figure in the unique and still largely obscure relationship to the underworld:

Except for a brief period when Robert Kennedy was pursuing the issue of the “skim” from Las Vegas casinos (most of which went to Lansky), Lansky was one of the three top organized crime figures never tapped of bugged by the FBI. (The other two, both also relevant to the Ruby story, were Carlos Marcello and Santo Trafficante.)[6]

A Lansky chronology may help to clarify matters:

In 1937, Lansky “established a special relationship with both FBN Chief Harry Anslinger and FBI Chief J Edgar Hoover,” by facilitating the arrest of Louis Buchalter—likely the top US drug trafficker and the figure Hoover described as “the most dangerous man in America.”[7] In 1939, the murder of Leon Cooke (with Jack Ruby in the room) led to Paul Dorfman’s ascension and the initial mob takeover of Teamster pension funds. In 1943, Lansky was recruited by the US government in Operation Underworld in order to help with the war effort. In 1945, Lansky was given the Medal of Freedom by President Harry Truman in a secret ceremony. This was the same year that Lanksy’s Mexican drug connection began operating. The 1946 murder of national racing wire king James Ragen traced back to Chicago underworld-connected oligarchs, Henry Crown and Walter Annenberg—the son of the pre-war racing wire king Moe Annenberg who was a “close friend of Meyer Lansky.”[8] As Peter Dale Scott notes, Ragen was shot “by Lennie Patrick and Dave Yaras, two longtime acquaintances of [Jack] Ruby.”[9] Later that year, Lansky associates opened up the Flamingo in Las Vegas, thereby establishing the Syndicate’s money laundering headquarters.

As for the indispensable role of Hoffa’s Teamsters, Sally Denton and Roger Morris summarize:

No figure, no union, charted more tellingly that larger corruption enveloping the nation than Hoffa and the Teamsters. Entangled with organized crime at almost every level, locals in Detroit, Miami, New York, and elsewhere were deeply involved not merely in racketeering in goods and services, jukeboxes here or contract kickbacks there, but in the Syndicate’s drug trafficking as well. In the Southern United States in particular, the union would be blatantly complicitous with the networks of major traffickers like Trafficante and Lansky, Teamster locals often sharing offices with narcotics dealers and acting as a depository or drop for both drug shipments and cash profits. Yet neither the McClellan Hearings in the fifties nor subsequent and sensational Hoffa prosecutions in the sixties exposed the drug scandal, one of the secrets mutually beneficial to all sides in a political culture in which the drug trade was already by 1960 so enmeshed with government intelligence, and providing large amounts of money to politicians in both parties. The drug connections were added proof of the pervasiveness of and integration of the Syndicate—of Las Vegas—and proved again the folly of an Italian-surnamed, simplistically “criminal” view of the system. “The postwar national Mafia became consolidated laterally, through kinship exploitation via the Teamsters of an intelligence-sanctioned drug traffic,” [Peter Dale] Scott concluded, “rather than downward from a hypothetical ethnic ‘national commission.’”[10]

The Deep State Global Drug Connection as Anticommintern 2.0

As Lansky was establishing and expanding postwar Syndicate operations centered in the US, fateful events were unfolding overseas. In 1946, British wartime spy chief Sir William Stephenson established the World Commerce Corporation (WCC), an outfit “designed to continue Anglo-American intelligence cooperation.” The WCC’s legal affairs were handled by US wartime intelligence chief William Donovan. The outfit was backed by a number of overworld titans, including John McCloy, Sir Victor Sassoon, Richard Mellon, and Nelson Rockefeller.[11] The WCC was instrumental is reestablishing the postwar opium traffic in Thailand and Burma. Scott identifies four figures who were key in this endeavor: William Donovan and Sir William Stephenson of the WCC along with OSS China veterans Paul Helliwell and Willis Bird. In these early postwar years, Helliwell was the chief of the Far East Division for the US Strategic Service Unit—the postwar successor of the OSS. From this position, he was reportedly “the man who controlled the pipeline of covert funds for secret operations throughout East Asia after the war.”[12]

It is unknown precisely how Helliwell obtained the funds which were used to reestablish the SE Asian drug connection in the years after the OSS was disbanded but before the notorious Office of Policy Coordination was created in 1948. Scott speculates that the drug trade itself may have been the source.[13] “Paul Helliwell,” Scott asserts, “must be counted part of Meyer Lansky’s milieu.”[14] To reestablish the SE Asian drug connection in the early postwar years, Helliwell may have had Lansky funds at his disposal. He represented an outfit called the Eastern Development Company, a firm that in the mid-1940’s cooperated with Meyer Lansky, Lansky’s friend and fellow Zionist agent Hank Greenspun of Las Vegas, and others to supply arms to the Zionists who would establish Israel.[15] Helliwell’s subsequent connections to Lansky are even more blatant. He was the owner of the Bank of Perrine, “a two-time laundromat for the Lansky mob and the CIA” in Florida’s Key West.[16] He was also connected to Lansky through the Miami National Bank. Helliwell was legal counsel for this small bank used by Lansky to launder money from abroad along with Las Vegas casino skim.[17]

Helliwell, an intelligence officer and corporate lawyer, is one of the most mysterious American deep state figures of the mid-20^th century. One of his specialties was the creation of front companies and proprietaries. He incorporated, in the US, Civil Air Transport and its later infamous incarnation—the heroin-trafficking Air America outfit.[18] In 1951 as an OPC officer, he incorporated Sea Supply, a proprietary which was instrumental in reestablishing the US presence in the opium heartlands of Southeast Asia.[19] In the early 1960’s, Helliwell established Castle Bank & Trust. In short order, Castle Bank began collecting deposits from CIA and underworld. Although it hasn’t been proven that Castle specifically laundered drug money, the bank’s creation happened just as people like Helliwell were expanding the CIA-mob ties in the Bahamas. Also at the same time, CIA actors were involving the Agency more directly with the Laotian drug traffic.[20]

When we examine the relationship between the Lansky Syndicate and the Cold War US national security state, we see the distinct holographic character of American Empire—a kind of free world fascism. During World War II, the US oligarchy of corporate wealth—represented most obviously by Wall Street’s Council on Foreign Relations—planned for US entry into World War II and for an “American Century” after the war. The American Century was basically a branding exercise to elide the imperialism of a new international system in which the US would reign hegemonic over global capitalism.

In keeping with the “freedom” motif, America’s European vassals would decolonize their foreign territories. US imperial planners understood that, pretenses aside, neither Europe nor the decolonized world could be allowed to exercise nationalistic sovereignty over their own countries. Overtly, the US backed the creation of the UN and even ratified the UN Charter to lay ground rules for lawfully resolving international conflict. Behind the scenes, deep state operatives like Allen Dulles and James Angleton were already planning to make use of paramilitary violence on behalf of the USA’s global imperial capitalist project. The Axis alliance was formally known as the Anticommintern Pact…an alliance of German, Italian, and Japanese fascists. This is logical because anticommunism essentially is a euphemism for fascism. This is not to say that anyone who is not a communist is a fascist. Rather, to be a partisan of the antithesis of communism is to support the absolutist defense of capitalist politico-economic hierarchy. In practice, this can be summed up as oligarchy uber alles. Fascists in Italy, Germany, and Japan triumphed because each country’s oligarchs recognized that only exceptionalist state terror could protect them from the threat of socialist revolution.

During the Great Depression, US elites went for democratic and mildly socialistic reforms to address the crisis. The New Deal centralized modest economic planning in the federal government to stabilize the economy and US society. World War II supercharged both the degree of central state planning and the level of expenditure. World War II was the massive government spending program that ended the Great Depression whereas the New Deal was too modest to do more than stabilize and modestly improve the situation. As I describe in detail in American Exception, after World War II, the US used state planning to shore up the new dollarized international system—first with the Marshall Fund, and then with the establishment of a privately incorporated permanent war economy.[21]

The dollar and the war machine were made the central pillars of US imperialism. Superficially, the US placed great emphasis on its self-proclaimed status as the leader of the free world. American policy makers needed to win over peoples in the decolonizing world, so they sent charismatic American celebrities and artists abroad to win people over. Domestically, the imperative of winning over the decolonizing “Third World” played a key and perhaps decisive role in the timing and manner in which the Civil Rights era unfolded. In short, Jim Crow segregation, lynchings, and white supremacy in general made the US look terrible to the non-white persons around the world that the US was trying to sway to the capitalist camp—and away from communism/socialism/nationalism.[22]

Of course, the architects of US Empire did not believe that soft power alone could win the world. Along with carrots, various sticks were needed. Since overt imperialism would have been counterproductive, the major US imperial innovations were to deny that it was an empire and to deny that it was the author of the imperial murder and mayhem that it deployed around the world. This is where covert operations came in. The period marked an era of symbiotic cooperation between two criminal entities: the US national security state and the mob.[23]

In Europe and East Asia, this manifested in strange things like Gladio, Propaganda Due, and the East Asian Peoples Anticommunist League. Collectively, these arrangements came to represent a nebulous supranational deep state. Mob figures, former Nazi/Italian/Japanese fascists, oligarchs, spooks, and military men comprised networks which could be used to veto democracy and override the rule of law by deploying clandestine paramilitary violence. Through the national wire service, the drug traffic, and Teamster corruption, a Syndicate-connected clandestine deep state emerged in the US as well. It controlled vast sums of off-the-books monies while enjoying protection from the FBN, FBI, and CIA. The overworld of private wealth—US corporate oligarchs—profited from both the illicit economies and the clandestine interventions they financed.

The net effect of the American deep state which arose in tandem with the post-World War II US global empire has been the Western regime’s gradual—but collectively drastic—shift from an imperfect (but generally lawful) democracy to an exceptionist, top-down regime in which sovereignty is held by obscure actors who reserve the right to covertly veto democratic politics through the use of clandestine statecraft. This is most dramatically illustrated by the murder of a very popular sitting president—and the sixty-plus year cover-up of the crime. The resulting imperial regime has served to aggrandize the most powerful and wealthy class of oligarchs in human history. Managing the unwinding of this project without sparking nuclear doomsday is perhaps the most perilous and urgent task that humanity has ever faced.

Special thanks to Casey Moore for the artwork!

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[1] Robert F. Kennedy, The Enemy Within, 2017 ed. (New York, NY: Ishi Press, 1960).

[2] Peter Dale Scott, Deep Politics and the Death of JFK (Berkeley, CA: University of California Press, 1993), 144.

[3] Scott, Deep Politics, 70-72.

[4] Scott, Deep Politics, 144-146.

[5] Scott, Deep Politics, 144.

[6] Scott, Deep Politics, 144.

[7] Scott, Deep Politics, 144.

[8] Scott, Deep Politics, 155.

[9] Scott, Deep Politics, 152.

[10] Sally Denton and Roger Morris, The Money and the Power: The Making of Las Vegas and Its Hold on America, (New York, NY: Vintage Books, 2002), 229-230.

[11] Peter Dale Scott, American War Machine: Deep Politics, the CIA Global Drug Connection, and the Road to Afghanistan (New York, NY: Rowman & Littlefield, 2010), 55.

[12] Scott, American War Machine, 71. cf Sterling Seagrave, The Marcos Dynasty (New York, NY: Harper & Row, 1988), 361.

[13] Scott, American War Machine, 71.

[14] Scott, American War Machine, 56.

[15] Scott, American War Machine, 71.

[16] Scott, American War Machine, 144.

[17] Scott, American War Machine, 148.

[18] Scott, American War Machine, 71.

[19] Alfred W. McCoy, The Politics of Heroin: CIA Complicity in the Global Drug Trade, 2nd Rev. ed (Chicago, IL: Lawrence Hill Books, 2003), 168, 184.

[20] Scott, American War Machine, 197.

[21] Aaron Good, American Exception: Empire and the Deep State (New York, NY: Skyhorse Publishing, 2022), 119-132. See also: C. Wright Mills, The Power Elite (New York, NY: Oxford University Press, 1956).

[22] Mary L. Dudziak, Cold War Civil Rights (Princeton, NJ: Princeton University Press, 2000).

[23] Good, American Exception, 118-119.