They can be protection rackets — are you going to massacre everyone who got coerced into their clutches, especially when the fear was of a rival racket?
my scenario is modeled more after the plot in “clear and present danger” by tom Clancy. if youre not familiar...in it the drug gangs are identified as a threat to national security (think cartels) and the cia/special forces start taking them out. im not really talking about your small time local wanna be thug pretenders but... ya know a lot of innocent people get shot in the cross fire between these “protection rackets” as you called them so I suppose I wouldn’t get too upset if some guy whose heart wasn’t really in it but joined anyway got mowed down in the process. until these guys see there is no future in being in a gang and that being in one will result in you disappearing in a sudden fashion they will continue to terrorize their neighborhoods.