Overextending the Political Machine
McLauglin tried to use his power to tamper with the 1936 Governor’s election. Governor Futrell had put a blind eye to Hot Springs gambling but Arkansas Attorney General Carl Bailey did not. Bailey, embarrassed by the Luciano scandal, spoke out against Hot Springs gambling. When the Attorney General decided to run for Governor, McLaughlin required all city employees not to vote for him. The mayor insinuated to local businesses that to remain open they must help pay for the anti-Bailey campaign. On election day, McLaughlin visited every polling place to deliver an anti-Bailey speech. Bailey still became governor.
Governor Bailey, not at all pleased with McLaughlin's actions, sent state officers to stake out the highways outside of Hot Springs and raid the gambling clubs within the city. Bailey issued search and destroy warrants, destroying gambling machines and costing the city $15,000. Jacobs tried to pay Bailey off but he refused the bribe.
Eventually, Governor Bailey eased up on Hot Springs because he decided to run for a U.S. Senator position. The Mayor backed the Governor because it would get him out of Hot Springs' business. While McLaughlin could control Hot Springs, he could not sway the state. Bailey lost and McLaughlin was beginning to wear out the patience of his citizens.