What Stays in Your Pocket

Don Vincenzo Carmuso couldn’t read a balance sheet. What he could do was ask one question, and he asked it of everyone who brought him good news: “How much of this is ours?”

You’d be surprised how often the good news ended right there.

A kid comes in and says: we’ve doubled turnover. Wonderful. How much of this is ours? Well, we had to take on six more men, rent a second warehouse, two people at the docks need paying now too, and the lorry got smashed up last week. And it turns out the Family worked twice as hard, took twice the risk, and the same amount went into the Family’s funds as last year. Sometimes less.

Remember the difference between the money that passed through your hands and the money that stayed in them. The first is noise. The second is what all the noise was for. At the office they make three words out of this: revenue is everything earned from goods sold and work done; profit is what’s left of revenue after all the month’s or the year’s expenses; margin is what share of revenue that is, in percentages and on a chart. We counted more simply: here’s the bundle the client brought, here’s everything we had to pay out of it, here’s what’s left. Just don’t confuse what’s left in the drawer with profit. The drawer may hold a deposit for work not yet done, and money you borrowed. And real profit may go on a new lorry and never reach the drawer at all. If, after all the expenses, only a thin layer is left of the bundle, you’re not a businessman. You’re a courier who carries other people’s money and risks his life a little for it.

The Millionaire Who Owed Five Hundred and Forty-Three Dollars

In the mid-thirties everyone in New York knew Ciro Terranova, half-brother of Giuseppe Morello, whom the papers called the Artichoke King. He was thought to be a millionaire. In 1935 he threw his daughter a lavish wedding. A reporter describing the sweet life of New York’s racketeers informed his readers that the supreme lord of the Harlem rackets liked to gallop over the hills of Westchester, because you met such interesting people on the bridle path.

In fact, writes the historian Mike Dash, Terranova was never as rich as people thought. The artichoke business, which he had handed over to an old subordinate back in 1931, reportedly brought in less than a third of a million a year, and that was the business’s takings, not his pocket. And when Luciano cut him out of his share of the Harlem numbers racket, Ciro was left with no source of income at all. In 1935 the tax people came after him. Two years later, apparently unable to pay a bill for five hundred and forty-three dollars, he declared himself bankrupt. The bank took his house. His list of assets showed two hundred dollars that other people owed him, two shares in a property company and a possible claim for wrongful arrest.

Remember this: the turnover the papers write about and the money you actually have are two different things. The Artichoke King went broke over a bill for five hundred and forty-three dollars.

Whose Work Are You Selling

There’s a subtlety here that trips up clever people.

You can do something genuinely useful and get nothing for it. You’ve cleared the street of punks, the shopkeepers breathe easy, trade picks up. A good deed? An excellent one. Now a question: who’s going to pay you for it? If you didn’t agree on it beforehand, the answer is nobody. The shopkeepers will say thank you, maybe pour you a drink. The street is better, and the Family’s funds are no fatter.

Creating value and taking your share of that value are two different jobs. A Family that can only do the first becomes a charity. A Family that can only do the second becomes a gang, and gets shut down fast: you can take without giving only for as long as people have no choice but to pay. And a choice always turns up.

Look at how the money was divided in the Bonanno family, as Pistone tells it. By the rules, a soldier told his captain about a big job in advance and handed him half the take, and the captain sent ten per cent upstairs, to the bosses. In practice, Pistone writes, the captains’ greed knew no bounds. A captain might announce that he wanted sixty per cent—that is, he kept his own half and made up the bosses’ share out of the soldier’s pocket. Some also took a kind of subscription fee, two hundred dollars a week. The result was predictable. The soldiers started working on the quiet: nobody could see why they should hand half to a man who hadn’t even gone on the job. Telling your captain you made eighty when you made a hundred was routine. And so on, all the way to the top.

There’s the other side of capturing value. If you take your share and the other man can’t see what for, he starts hiding money from you. Take an amount that makes it worth the worker’s while to show you all the takings. Otherwise you’ll be getting a percentage of whatever sum he feels like naming.

A good business works like this: you give people more than you take, but you always take. And you agree on your share before you start work, not after. After the work is done, people’s gratitude lasts until about the evening.

How Much Is Enough

Now for something business schools don’t talk about, because nobody pays two hundred thousand dollars for it.

Every Don I’ve buried had one thing in common. No, not enemies. Everyone has enemies. Not one of them had an answer to the question: “How much is enough for you?”

A Don without that number can’t stop. One district isn’t enough, so he pushes into a second, where more serious people are already sitting. The docks aren’t enough, so he pushes into the unions, and there the newspapers are waiting for him. Every new piece of turf brings in less and costs more, but he can’t stop: stopping would mean admitting the race was never about money.

Know your number. How much the Family needs to live in peace, feed its people, keep something by for a rainy day and not fear the next winter. Above that number, every new deal buys you not a life but a risk. Sometimes it’s worth taking. But you have to understand exactly what you’re buying.

At the office it’s just as simple. A man who has enough calmly turns down a bad client, a loan at a predatory rate, a partner with shifty eyes. A man who never has enough can be sold anything. And usually he is.

Don Vincenzo, by the way, lived to eighty and died in his own bed. His number was written on the back of the icon in his bedroom. Nobody but him knew what it was.