The Queen

by Josh Levin

  Piper’s indictment charged Otis with perpetrating the most elaborate, largest-scale recipient fraud scheme in the state’s history. Otis’s ruse lasted for six years and involved five different public aid cases. She swiped one of her identities from a Chicago actor, Greta Stewart, who’d starred in the national tour of the musical Hair. A black woman whose behavior pushed beyond the bounds of reason, Otis offered the strongest confirmation yet that Linda Taylor was a type rather than an outlier. “Atrocious things are going on in the welfare system, and the taxpayer is catching it,” Piper told U.S. News & World Report. “If this Otis case doesn’t prove to the taxpayer that something needs to be done, nothing will.”

  * * *

  Before Linda Taylor came along, the Illinois Department of Public Aid sent caseworkers into the field to spot-check recipients’ eligibility. After Taylor made Illinois infamous, the department began a systematic audit of the Aid to Families with Dependent Children, general assistance, and medical assistance rolls, with each caseworker required to conduct eight in-home client interviews per day. In Cook County, the agency also started mailing AFDC checks directly to currency exchanges and banks, requiring recipients to show multiple forms of ID to get their monthly payments.

  There were a lot of poor people to monitor in Illinois in the 1970s, particularly in Cook County. In 1970, 483,487 Chicagoans lived below the poverty line. That number would grow to 601,410 by 1980, even as the city’s population declined. The Public Aid Department’s more aggressive surveillance revealed, if it needed revealing, that a lot of AFDC recipients had been supplementing their welfare checks with cash from off-the-books work. Before the 1970s, such failures to report outside income had typically either been ignored or handled as an administrative matter. As Reagan’s welfare policy adviser Robert Carleson once explained with regard to the California public aid system, “The benefits were too low and people really couldn’t make it on those benefits, so the whole system was looking the other way.” In Illinois in the mid-1970s, the benefits were definitely too low. Between January 1975 and July 1978, when the annual inflation rate in the U.S. ranged between 5 and 9 percent per year, the dollar amounts inscribed on AFDC recipients’ checks—$317 per month for a family of four—remained unchanged.

  No family could be expected to make it on those benefits, much less get rich off them. Nevertheless, the system had stopped looking the other way when it came to alleged rule bending. When the state’s new Republican governor, James Thompson, approved a 5 percent cost-of-living increase for families on public aid in 1978, he tied the appropriation to a parallel jump in spending on fraud investigations. In the late 1970s, there were at least five groups in Illinois tasked with taking on welfare fraud: the Department of Public Aid, the Department of Law Enforcement, the state comptroller’s office, Don Moore’s Legislative Advisory Committee on Public Aid, and Jim Piper’s unit in the Cook County state’s attorney’s office. Individual recipient fraud was increasingly seen as a matter best handled by the criminal justice system. In the fiscal year that ended June 30, 1970, the State of Illinois terminated 870 public assistance cases due to fraud, with 240 of those—28 percent—referred to law enforcement. Nine years later, the state terminated 2,638 cases because of fraud and forwarded 1,995 of them—76 percent—to law enforcement. The criminalization of welfare fraud was a nationwide trend. Between 1970 and 1979, the number of AFDC cases referred to law enforcement in the United States rose from seventy-five hundred to just more than fifty-two thousand.

  In terms of the bottom line, there was little value in marching cheaters into court. George Lindberg, the former state comptroller whose signature adorned the front of Linda Taylor’s welfare checks, said in 1977 that trying to extract cash from fraudsters was pointless: They didn’t have any, so the state wasn’t getting any. Taylor cost the state money as both a public aid recipient and a criminal defendant. In June 1978, Illinois’s Lindsay-Schaub News Service reported that Cook County had spent a minimum of $50,000 to convict Taylor of stealing less than $9,000. Piper didn’t think those numbers reflected the real worth of his prosecutions. “For every cheat you get, you also cause others in the community to stop and think about what they’re doing,” he said.

  Linda Taylor and Arlene Otis, though, had as much in common with a typical welfare rule breaker as a bank robber does with someone who swipes a piece of penny candy. The Tribune’s embrace of the “welfare queen” nickname and Ronald Reagan’s use of Taylor as a metonym for public aid fraud muddled that distinction, ensuring that all welfare recipients would be viewed with suspicion, and that the welfare cheat–hating public would want to see them punished. A survey conducted in Illinois in 1978 found that 84 percent of the state’s voters believed that fraud and abuse in welfare and Medicaid were a matter of grave concern, the highest figure for any issue. For certain Illinois politicians, then, chest-thumping about welfare fraud was an essential bit of constituent service.

  Don Moore’s Legislative Advisory Committee on Public Aid claimed that its fraud investigations saved taxpayers close to $1 million in just the first six months of 1977. That was an exaggeration—the maximum possible total if the Illinois Department of Public Aid had dropped every case the committee sent its way. In reality, the canceled cases amounted to closer to $300,000.

  Seventy percent bluster to 30 percent reality was a standard ratio for Moore. In the years after the Linda Taylor case, the legislative committee’s investigators spent much of their time digging into big-ticket Medicaid fraud. In 1976, for instance, they’d partnered with George Bliss and another Tribune reporter to uncover a scam in which optical firms billed Medicaid for millions of dollars’ worth of eye exams they’d never conducted and glasses they’d never dispensed. But the Legislative Advisory Committee on Public Aid never stopped pointing its spotlight at individual, small-dollar welfare cheaters. In the fall of 1977, Moore’s group invited members of the media to watch as it filed a batch of twenty welfare fraud cases. These would be the first prosecutions carried out at a special, one-day-a-month welfare fraud court in the south Chicago suburb of Harvey, Illinois—a facility created at the behest of the chief judge of the circuit court of Cook County. Don Moore now had his own committee, his own investigators, and his own hall of justice.

  Moore’s agenda didn’t win universal acclaim in the Illinois legislature. On April 29, 1976, the Republican state senator proposed halving an appropriation to the Department of Public Aid unless the agency could “correct public aid fraud.” Democrat Robert W. McCarthy responded to that idea with a long tirade about politically motivated public servants. “I am aware of the fact that there is no more popular political issue that people can understand and complain about than the whole spectrum of welfare payments,” he said.

  I know that that’s a popular political issue, because my wife informs me of that fact, that what the voters are mad about is food stamp abuses, what they’re mad about is overpayment to people who are too lazy to work. Incidentally, I asked my wife where she gets this information. She tells me she gets it at her tennis club, and that she gets it at the beauty shop from other people, and I don’t think the people that are playing tennis at the Decatur Racquet Club for eight dollars an hour or getting their hair done are in a position really to know too much about it.…

  [In] about three weeks, we’ll come down and they can play the same old violin about the abuses of public aid, and people understand it, and newsmen know how to write it, and the printers know how to print it, and so, the public will read about it, and my wife will hear about it more vociferously at the tennis club and at the beauty shop, and I’ll hear more about it.…We’re playing the game of talking about fraud, because they want us to talk about fraud.

  A year later, state senator Richard Newhouse declared that it was past time for the Legislative Advisory Committee on Public Aid to shift its focus to protecting recipients’ rights. “‘Welfare cheaters’ has become the new code word for the poor, for minorities in general and those tempora
rily down on their luck,” the black Democrat from Chicago’s Hyde Park told the Defender.* In 1977 and 1978, Newhouse continually pushed to unseat Moore as the chair of the committee. In a series of votes, the twelve-member bipartisan group repeatedly split six to six on the question of which politician should lead it. Those deadlocks left the incumbent Moore in control. “I think they’re trying to give me a message, and I’m hearing it,” the state senator said, “but I plan to stay around.”

  * * *

  Nobody from the local or national press took note when America’s original welfare queen arrived at Dwight Correctional Center on February 16, 1978. Taylor wouldn’t fade slowly into obscurity after heading off to a state prison eighty miles southwest of Chicago. Rather, it would take just a few years for her to get expunged from the historical record. In 1982, the New Republic would publish an essay criticizing Ronald Reagan for his frequent mentions of “the celebrated Chicago ‘welfare queen’ who did not exist.” When the press and politicians built her into an archetype, Taylor lost her individual identity. When they anointed a series of successors to her throne, she was forgotten entirely.

  She used eighty different names. She stole $150,000 of welfare money a year. She could pass as black, white, Latina, or Filipina. She practiced voodoo. She had a bunch of dead husbands. She stole children. She killed a thirty-seven-year-old mother of three. After three and a half years’ worth of newspaper articles, stump speeches, and allegations from outraged public officials, nobody knew or much cared which parts of the Linda Taylor story were true, which were exaggerations, and which were outright lies.

  Jack Sherwin had tried to separate fact from fiction, but he’d been marginalized by bureaucrats whose agendas didn’t match his own. Sherwin had defied departmental leaders in pursuing the Taylor case in 1974, a move he thought would kill his career. The detective was half right: Although he didn’t get pushed out of the force, Sherwin didn’t get promoted either. He thought that he’d been held back because he wasn’t a suck-up—that he would’ve made sergeant if he’d played the right political games.

  Sherwin would hold on to his notes from the Taylor case for years, hoping someone, somewhere, would have some interest in investigating her for kidnapping and murder. Eventually, he’d throw away those personal files, resigning himself to the reality that no individual or institution would invest the time in figuring out what Taylor had done and why she’d done it.

  The key to unlocking her past was in another set of files, a sealed trove of documents from Cook County Probate Court. In Chicago in 1964, Taylor had staked a claim to a massive fortune. On the witness stand, she’d laid out her biography, explaining where she’d come from and how she’d spent her life. Her name, she said, was Constance Wakefield, and her father was one of the richest men in Chicago.

  * In 1997, six years after Newhouse’s retirement from politics, Barack Obama took over the South Side politician’s Thirteenth District state senate seat.

  Chapter 10

  She Knows About the Money

  At 4:45 a.m. on February 18, 1964, a pair of Chicago police officers peered down at a dying man. Lawrence Wakefield was lying in a twin bed, fully dressed, and grabbing the left side of his chest. He tried to choke out a message, but all he could do was grunt in pain. The fire department’s rescue squad had pulled up to 9312 South Rhodes Avenue at the same time as the cops, but its equipment wouldn’t keep the fifty-nine-year-old Wakefield alive for long. He needed to get to a hospital.

  Patrolman William Childs stepped out of the front bedroom and glanced around the South Side home. The place looked a bit decrepit, as if all the furniture had been nailed to the floor circa 1945. Given that nothing in the house seemed newer than a decade-old refrigerator, the officer suggested that Wakefield’s next of kin call an emergency service that would be willing to transport indigent patients. Rose Kennedy, the seventy-year-old woman who’d summoned the police, said she’d prefer that he travel by private ambulance.

  As Kennedy made the call, Childs peered at the old newspapers on the dining room table. It looked as if someone had dropped them there in a hurry. He also noticed four or five men’s hats, a stack of unused coin wrappers, and a paper bag filled with what appeared to be $100 or $200 in $1 bills. When Kennedy left the room to check on Wakefield, the policeman lifted the pile of newsprint. Childs found around $50 in silver coins, as well as an adding machine tape with “1,082” scribbled at the end in pencil. The large amount of small bills and coins indicated that someone in the house could be involved in policy, a low-stakes numbers game indigenous to Chicago. Upon Kennedy’s return, the officer asked her what Wakefield did for a living. She said he was a freelance real estate broker.

  The policemen left before the ambulance came to take Wakefield to Presbyterian–St. Luke’s Hospital. When Childs got back to unit headquarters, he called the state bureau of identification to run a record check. Wakefield, he was told, had been arrested multiple times by the Chicago Police Department’s vice squad.

  After the sun rose, the man in charge of the Kensington police district sent another pair of officers to stake out Wakefield’s two-story brick mock Tudor. They sat in their car for a couple of hours on February 18, then again for a short spell on February 19, peeking through the wire mesh that covered the downstairs windows and waiting to see if anybody came out or went in. Nobody did.

  At 3 p.m. on that second day, a team of detectives short-circuited the surveillance mission. Although the police didn’t have enough evidence for a search warrant, Bernard Kay and George Martis decided they’d try the front entrance. Thirty-six hours after she’d implored the police to hurry over to tend to the stricken Wakefield, Rose Kennedy was dressed in a housecoat and in a disagreeable mood. Later, she’d testify that the detectives had threatened to shoot her dogs if she didn’t let them inside. The police denied making any such threats—they said Kennedy opened the door of her own volition and told them they were welcome to nose around.

  The officers found what they were looking for down in the basement. In dusty cardboard boxes and a wet and dirty wooden cabinet, they uncovered all the equipment necessary to run a policy operation: the wheels used to select the winning numbers, the printing presses that churned out the daily results, and the thin slips of paper known as onion skins that runners used to jot down customers’ bets. As the cops turned their attention to a locked bedroom in the back of the house, Kennedy insisted on speaking to the district commander. On the phone, she told Edward Egan she wouldn’t unlock the room for anyone. She owned a collection of valuable coins, she explained, and she wanted to make sure they didn’t get swiped. Depending on whose story you believed, Egan either assuaged her concerns or Kay and Martis busted through the door. Either way, that locked room didn’t stay locked for long.

  When the door swung open, the detectives found a tycoon’s treasure vault. There was cash piled on the floor and pouring out of bank bags, stuffed in the closet and jammed between the cushions of a couch. The bills ranged in value from $1 to $500. Some were oversized—a type of banknote that hadn’t been in production since the 1920s. None of the officers who showed up to aid in the search had ever seen this amount of money. One of them later claimed he’d almost fainted when he’d spotted the stash.

  Although the cops placed Kennedy under arrest for possession of gambling equipment, they treated the back bedroom less as a crime scene than a photo opportunity. Within a couple of hours, the brick house on South Rhodes Avenue was crawling with reporters and photographers. In pictures that ran in the next day’s Chicago Tribune and Chicago Sun-Times, Kay, Martis, and their commander wore stern expressions as they peered at the massive piles of money, their fists full of dollars.

  When the men got through with posing, Commander Egan ordered them to confiscate everything in sight—these were obviously the ill-gotten proceeds of a gambling enterprise. The police emptied each of the bank bags, then poured the riches into the biggest vessels they could find. Kennedy watched this bucket brig
ade while seated in a small chair, with bags of currency below her seat and shoes; the policewomen who’d been brought in to mind the bespectacled septuagenarian caught her dropping stray bills down the front of her dress. Elsewhere in the house, the cops found seven loaded firearms and slips for five safety-deposit boxes. They discovered additional cash reserves beneath the hindquarters of one of Kennedy’s dogs.

  The money filled thirty-two sacks—the largest of the bank bags, plus some pillowcases and a duffel bag. The police numbered each of those receptacles, loaded the plunder and Rose Kennedy into a squadrol, and drove three miles south to the district police station. At 9 p.m. on February 19, cops from the evidence and recovered property section started counting. They finished the first sack around midnight. It held $120,000.

  Kennedy looked on from the corner of the room, doing her own arithmetic with pencil and paper. She kept up a running commentary, shouting that every bill and coin was her personal property. She’d brought $160,000 with her from Canada in the 1920s, she said, intimating to a deputy chief that she’d earned a big chunk of that as a high-priced, World War I–era prostitute. She also admitted that she’d started a gambling business with her first husband; Wakefield had taken over the day-to-day operations after she’d been widowed. Kennedy, who was white, said that her black business manager had doubled as her common-law spouse for more than two decades. He kept his money away from banks, she explained, because “the government would want to know where he got it.”