HIGH ROLLERS, HIGH DOLLARS

AND THE GALVESTON THAT WAS

In 1901, the Lucas gusher blew in at Spindletop, near Beaumont (about 100 miles northeast of Galveston), producing the first major Texas oil field.  That same year, the Maceo family arrived in America from Palermo, Sicily.  By 1914, brothers Sam and Rose had moved to Galveston Island.  With money they had made from bootlegging during prohibition, they expanded into the nightclub business and built a gambling empire.  In the years that followed, Texas got rich, very rich, and so did the Maceo’s. 

Maceo and Company invited the rich “High Rollers” of the Texas oil industry to “Come down and Play on Galveston Island” at their Balinese and Western Rooms.  While the former entertained the gulf gamblers, the Western Room, located on the third floor of the Turf Athletic Club, catered to those downtown.  The Bank of America stands there today appropriately enough on the old site of Galveston’s “Weekend Bank.”  Multi-millionaires and oil magnates from Houston and Dallas, like Glenn McCarthy, Mike Hogg, the Cullens, Mills Bennett, Diamond Jim West and Jack Josey regularly wagered “High Dollars” at the Maceo clubs.  

Just how high was high?  Back then, for two nickels grandpa could buy a pack of cigarettes or a bottle of beer.  He could fill up his coupe with gas or take two pulls on a bell-fruit-gum slot machine over at the washateria.  However, today a dollar doesn’t go as far as it used to.  In fact, based on the Consumer Price Index (CPI) in 1995,  $1.00 spent in 1933 had the same buying power as $10.89.   In 1942, a $500 gaming chip from the Balinese Room would equal $5,045.00 in the 1995 market, while in 1945 the same $100 chip would buy $844.00 worth.   Whenever a “High Roller” craps player bet $100,000 on one toss of the dice in the ‘40’s, the 1995 CPI equivalent was $760,680.  That’s an awful lot of beer and cigarettes! 

Besides the island, surrounding bayside towns such as Algoa, La Marque, Santa Fe, Dickinson and Kemah were wide-open for dancing, drinking and dining with a little gaming on the side.  Blackjack, poker, “low-ball” poker, along with horse and sports wagering provided the action.  Since they controlled most of it, folks going south on I45 from Houston joked about crossing the Maceo-Dickinson line, even though Maceo and Company had expanded to include the Serio, Fertitta, Savato and Emmitte families.  According to author Gary Cartwright, their holding company, Gulf Properties, employed over 2,500 people, which was about 10% of Galveston’s population, and this didn’t include those police, judges and politicians who were “off the payroll,” so to speak. 

In 1951, oilman R. H. Abercrombie was called as a witness in a government tax suit against the Maceos.   When asked to identify a bank draft found among their books, he testified that he had lost $30,000 ($228,204 in 1995 dollars.)  Historian David McComb wrote that IRS records reported a total income of $3,835,000.00 for Maceo and Company in 1950, which would equal $23,893,967.50 in 1995 – and that was a BAD year!

Estes Kefauver, a junior Tennessee Senator with aspirations for national politics, launched a law and order investigation of crime, gambling and the rackets.  The Texas legislature’s “Little Kefauver Committee” subpoenaed the Gulf Properties, Inc. books and family members and held public hearings on racketeering.  Soon after, a grand jury indicted 22 partners of Maceo and Company.  Sam Maceo escaped prosecution when he died of cancer in 1951; Rose was too sick testify and died two years later.  Most charges were dropped, but the damage had been done.  The publicity branded Galveston as “Sin City,” and the Island became a conspicuous symbol of vice for reformers. 

Up in Austin, Attorney General Will Wilson and his Texas Rangers prepared to cross the Causeway to march on Galveston Island, much as Julius Caesar’s march on Rome in 49 BC ended that empire.   The “AG Who Would Be Governor” needed the “hook” as a strong law and order reformer, so Wilson and his staff set up an undercover sting operation.  The first reconnaissance took seven months and ‘way over $3,000 in state funds to compile a ”hit” list of raid targets.   On the eve of June 5, 1957, a task force of over 100 Texas Law Enforcers, armed with secret search warrants, waited with an entourage of handpicked photographers and reporters to invade Galveston Island and catch illegal gamblers in the act.  However, none of the targeted clubs were open that evening and the “Mother of All Raids” was cancelled. 

Five days later, however, the law prevailed as the Attorney General’s office sought injunctions against 52 clubs at Galveston’s 56^th District Court.  Led by crime crusader-editor Clyde Ragsdale of the obscure, small-town Texas City Sun, photographs of Rangers relentlessly smashing illegal slots and gaming equipment made the Island national news.  As publicity grew, the District Attorney was forced to issue felony gambling charges.  By the end of June 1957, Will Wilson’s injunctions cancelled all bets on Galveston Island and the Maceo Empire fell. 

The “AG Who Would Be Governor,” Will Wilson, never made it to the Texas Governor’s mansion.  In fact, he was later implicated in the notorious Sharpstown banking scandal and ended up with a 20-year jail sentence. 

In another twist of irony, Estes Kefauver ran for Vice President with Adlai Stevenson, and ended up a loser.  And the Maceos?  Their descendants became hard-working, middle class citizens of Galveston Island, working to save lives on the Beach Patrol or peddling spices and their famous muffelettas. 

Many of the Maceo casino bosses headed for Las Vegas, where gambling was legal, to work for fellow Texans Benny Binion and Joe W. Brown at the Horseshoe Club downtown and Jakie Friedman at the Sands on the Strip.   So did the big name entertainers and the rich “High Rollers” who, along with their wives and mistresses, had once “played” on Galveston Island.  The most recent glory that was Galveston, its “Free State,” faded into fond memories of the Galveston that was. 

(A very special Thank You to Doc Fienstein of San Antonio for sending his stories to me and allowing me to re-write them for publication in the Parrot!)