He was one of the most powerful drug traffickers at the time and his status and position could have probably trumped a lot of people in new yorks criminal underworld. Cant say that he was more powerful than two crime families but i will say that the drug trafficking and running a union and gambling are completely different fields of criminal activity, and that killing barnes wasn't going to somehow bring things back to the way they were in fact it probably would have made things worser on the streets and in the prisons when it came to down to the mob trying to live and operate in the city.