They look like
any American family.
To the eye,
nothing seems out of place.
They appear typical
by all accounts
for a family living in
post-World War II America.
An economic boom
was in progress,
and the horizon is filled
with opportunity.
The mood was different, then.
Very different from the mood
in America today.
With the recent collapse
of the American
banking system,
and the stunning fracture
of Wall Street,
America, as we know it,
has been changed forever.
Only one other time
has America experienced
a financial catastrophe
of such magnitude.
The Wall Street crash
in 1929
was the most devastating
economic upheaval
in American history.
The parallels between
the crash of 1929
and the recent
economic emergency
in America
are chilling.
In both instances,
massive speculation
gave license to those
who would take advantage
of a system,
flawed from the outset,
and permissive
to a fault.
The tragic irony of
the recent financial collapse
is that our companies, banks,
and financial institutions
operated, for the most part,
within the framework
of the law.
So, who is responsible
when so many
are so badly damaged?
Where are the checks
and balances?
Where is accountability,
when corporations,
institutions, and governments
are self
In the mid-1960s,
with the shifting
social climate,
a new concept is introduced
into the business mainstream:
Corporate social
responsibility.
CSR is defined as:
"economic, legal, ethical"
"and discretionary
expectations"
"which society has
of its corporations"
"and institutions
at any given point in time."
It sounds reasonable.
However,
this concept presupposes
society has sway
with big corporations
and big institutions.
It's rarely the case,
and it begs the question:
Is it realistic
for society
to have such moral expectations
of business,
where ethics and discretion
are concerned?
With government deregulation
during the past three decades,
and the freedoms
the government granted
to American banks
and financial institutions,
over-speculation
and dangerously creative
investment platforms
have proved one thing:
"Corporate Social
Responsibility"
appears to have become
a well-meaning proposition
with little traction,
while big stakeholders
and corporations
helm the economy.
If social responsibility
ought to apply
to corporations
and institutions,
should it not also apply
to government?
After all, government
sanctions the way
business works.
Government makes the rules
and creates the laws
in our society.
So why not "government
social responsibility?"
One thing is clear:
The application of
corporate social
responsibility
is no burden
to success,
because to corporations,
to Wall Street,
to the banking system,
it simply does not exist.
Greed rules.
1947, Florida.
The Shaw family
is living a life
not unlike any other
typical American family.
Walter Shaw is bright,
talented,
a man with
a promising future.
The war is over,
and everyone is back to work.
And a young man,
fresh off a Navy patrol boat,
is being groomed
for political office.
John Fitzgerald Kennedy's
father, Joseph,
is a fiercely ambitious man.
In the 1920s,
he amasses
most of his family fortune
in the stock market,
and he manages
to exit the market
just before its fall.
A few years later,
Kennedy is alleged
to have traded
in bootleg liquor
during the Prohibition era.
If nothing else,
it may be said
Kennedy has a knack
for good timing.
In 1934,
Joe Kennedy becomes chairman
of the Securities and Exchange
Commission,
where he outlaws
insider trading
and stock manipulation;
the very practice
which was rumored
to have made his,
and many of his friends,
their fortunes.
But his ambitions
were not only for wealth.
Power was the real prize.
Using his considerable
wealth and influence,
he aides his son
in a bid for a seat
in Congress.
John F. Kennedy is elected
to the 80th Congress
January 3, 1947,
while his brother, Robert,
attends law school.
In a surprising twist of fate,
the Kennedys and the Shaws
will soon cross paths,
and it will change their lives
forever.
Walter Shaw, breadwinner,
with a grade nine education,
works for the largest
corporate monopoly in America,
Bell Telephone,
while Betty Lou,
a stay-at-home mother,
raises their children.
Daughter, Linda,
attends middle school.
New baby brother, Thiel,
is just born.
My dad was still
at Bell Labs
when I was born
in '48.
Matter of fact,
I was born the year
the inven-
the-the speaker phone
was invented.
Walter Shaw
has been a lineman
for AT&T's
Bell Telephone company
since 1935.
He is paid a base salary,
with bumps in pay
based on how many feet of line
he could lay.
In other words,
he is paid by the foot.
My earliest memories of-
was Dad working for Bell Labs.
Uh, working-
Well, he started out...
He was a, uh, pole climber.
But, uh, early on, he...
He, ah, I would find him...
...tinkering with projects.
And he loved electronics.
It was a natural love.
Bell would soon learn
that Shaw is capable
of much more.
He studies
at Bell's engineering school,
where they discover
he has an aptitude
for calculus.
He becomes an engineer
in the research
and development division
of Bell Laboratories,
the technology research
and development division
of AT&T.
It's no secret that Bell
is the only telephone company
in America.
It was designed that way.
Bell Telephone began
in 1877,
with inventor
Alexander Graham Bell.
Bell succeeded
with his invention
and secured the patents
in 1876 and 1877.
The patents were
a contentious issue,
when many rivals
challenged Bell's right
to the invention.
During the 17 years
in which Bell
held the telephone patent,
he faced no less
than 600 lawsuits.
Once Bell's patent expired,
tens of thousands
of independent
telephone companies
sprung up across America.
Surprisingly
to the Bell system,
they were serving the areas
that Bell
had basically ignored.
So Bell started in Boston
and kind of slowly spread
from the Northeast
to the rest of the country.
And the independent movement
started in the Midwest,
or what, at the time,
they called the West,
places like Ohio, Indiana,
and Illinois,
and, ah, tried to spread
into the big cities.
And so, these companies
achieved astounding levels
of telephone penetration.
The telephone business
suddenly exploded,
but the thousands of new,
competing telephone companies
produced a new set of problems
for Bell.
They had, indeed,
underdeveloped the country,
so they entered a race
with the independents
to build out
the rest of the country.
That was
reasonably successfully,
and again, it was very good
for the consumer
because, ah, it spread
telephone service further
and further
into the country,
and deeper and deeper
into the cities.
And they lowered
their prices.
Uh, but the next thing
they did,
was they realized
that they were not going to
out-compete the independents
in most of these places.
As a young man,
Theodore Vail goes to work
for a telegraph company.
That decision
will change the course
of American history.
Vail meets a man
named Gardiner Hubbard,
Alexander Graham Bell's
father-in-law.
Hubbard hire Vail
to run his new company,
called
American Bell Telephone.
By 1907,
J.P. Morgan,
with London and
New York backers,
are in a state of panic.
Bell Telephone is suffering
from a poor public image,
low staff morale,
poor service,
and serious debt
and technological problems.
Vail had left the company
by this time,
but he is brought back.
Vail was very surprised
at how Bell
was basically losing
this struggle,
or, at least,
not assured of winning it.
So, Vail was brought back
in 1907,
um, by some of
the Morgan interests
who injected capital
into the AT&T,
and he, again, said
we need to rethink this whole
business of competition
in telephony.
We need to move towards
what he called
"One system, one policy,
universal service."
And by that, Vail meant
uh, fundamentally,
a monopoly,
a regulated
telephone monopoly
in which the independents,
uh, they'd be allowed to exist
on the margins,
but they would be
no competition
at the local exchange level,
and all of these
phone companies
would be interconnected,
and Bell would fundamentally
control the interconnections
among all of these systems.
They would
be the ones
who really were
the gatekeepers
for the national flow
of telephone traffic.
And in order
to achieve this monopoly,
Vail said, basically,
"Let's make a deal
to the government."
Theodore Vail convinces
President Woodrow Wilson,
and Congress,
that no collection
of independent companies
could ever give the public
the kind of service
Bell could provide.
AT&T's extensive campaign
for One Policy, One System,
Universal Service
was a thinly veiled front
for complete control
of the telephone system
under one roof.
It is a goal
which is only achievable
with government intervention.
Vail knows the public
will never go
for a Bell monopoly,
so he invites
government regulation.
He knows this will
annihilate competitors.
He will not only
get his monopoly,
he will get
monopoly profits.
Congress passes
the Kingsbury Commitment
in 1913,
which will weed out
most competitors to Bell.
AT&T Long Lines
was responsible
for interconnecting
all these companies.
Therefore, AT&T controlled
all the little monopolies
that were sanctioned by
the Kingsbury Commitment.
While the act
had been intended
to stimulate competition,
instead, it has
the opposite effect.
Theodore Vail writes
in the AT&T annual report
that government regulation,
provided it is independent,
intelligent, considerate,
thorough, and just,
was an acceptable substitute
for a competitive marketplace.
Vail convinces Congress
that the telephone
is a natural monopoly.
The whole theory
of natural monopoly
didn't really apply properly
to the telephone industry.
Nevertheless, uh...
It was rationalized,
after the fact,
as a natural monopoly,
and for about forty years,
you know, utility economists
would sort of say,
oh, of course it's a monopoly,
it's a natural monopoly
under natural monopoly theory,
but if you looked
at the the theory,
and you looked
at the actual economics
of the telephone,
it wasn't.
There was no correlation
between the economics
of the telephone exchange
and the natural monopoly
theory.
Congress passes an act
which seals the fate
of all independent
telephone companies
in America.
After World War I,
people at the federal level
in particular,
as part of the sort of
the progressive viewpoint
of the time,
were convinced
that we needed this
regulated monopoly system,
and then they passed
the Willis-Graham Act in 1921,
which basically legitimized
telephone monopoly.
It said you're exempt
from the anti-trust laws.
Uh, it doesn't matter
if you're a monopoly,
we're not
going to prosecute you.
We, in fact, want you
to be a monopoly.
Once the phone system
is nationalized,
AT&T wastes no time in
applying for rate increases.
Within five and a half months,
long distance rates increase
by twenty percent.
AT&T makes over
fifty million dollars
in just seven months.
AT&T, American Telephone
and Telegraph,
was the parent company
of four different companies.
One was the Bell
operating companies
that would put in the lines
to everybody's homes
and businesses.
There was AT&T Long Lines,
who interconnected
those various exchange areas,
and then there was
Western Electric,
who manufactured the equipment
for AT&T,
and then Bell Labs,
who was the research
and development arm
for AT&T.
Bell telephone had a...
a-a-a tariff that said
you could not hook up
the Bell lines,
you can't find it
in the books anymore,
Bell lines without
their explicit permission.
And they were emphatic
about that.
If anyone uses
a telephone line in America,
it belongs to Bell.
Three decades later,
Walter Shaw,
while working at Bell Labs,
will challenge Bell's
universal process.
He has a secret.
When he returns home
each night,
he draws.
Not landscapes
or portraits,
he draws schematic diagrams
of inventions
he plans to build.
Later, he will go
to his office
with his home projects
under his arm
to impress his bosses.
And they are impressed.
Bell Labs was created
in 1925
to service
research and development
technology
for AT&T.
Bell will not only provide
communication services
to America,
but it will become
one of the leading innovators
in science, technology,
and military engineering
around the world.
Bell Labs provides
key personnel
in all areas
of communications science,
radar,
and weapons technology.
And they provide
the scientists and engineers
responsible, in part,
for the development
of the atomic bomb.
It would not be
an overstatement
to say that Bell Labs
became the darling
of the U.S.
Defense Department.
While at home working
on one of his drawings,
Walter Shaw invents
the first ever
voice-activated
speaker phone.
He doesn't show Bell
right away.
Instead, he actually builds
the prototype himself.
Meanwhile, Bell promotes Shaw
to the position
of senior engineer.
What Walter Shaw
will soon learn
is that the
U.S. Attorney General
under President Truman
has filed a lawsuit
against his employer
for anti-trust violations.
What was happening
at that time
was a realization
that so much technology
was really bundled up
in the Bell system,
and we were afraid
that all kinds
of new technologies
that could be competitive,
and could be out there
in the marketplace,
and could be innovative,
that might actually
undermine the control
of AT&T,
we started to become concerned
that, uh, those
were gonna get bottled up
in-in the Bell system.
Oh, he used to
always say...
He'd say it to me
as a kid,
my mother, too, he'd say,
"If I can draw it,
it'll work when I make it."
I said,
"Why do you say that, Dad?"
He said,"Because my circuitry
doesn't lie."
And neither did Shaw.
He isn't shy about impressing
the executives at Bell
with his new invention.
Oh, he told 'em.
He says "This is just one
of many I can..."
But, you- He'd say things like
"I've drawn it, I've seen it."
"I've got it on paper."
And-and they saw
what he could build
when it came from paper
into a demonstration,
and they says, "This guy
is somebody to reckon with."
They knew it.
Over the next few years,
Walter continues
to produce designs
of advanced technology.
He designs systems
for burglar alarms,
touch-tone phones,
and conference calling.
Bell management
is becoming worried.
Shaw is prolific.
He was a spiritual man.
He had to be,
because he knew
that this was a gift.
What was coming
through his hands, I'm sure,
and his mind,
amazed him...
...more than it amazed
most people
that didn't understand it.
But Walter Shaw
has become a threat.
Bell executives
call a meeting.
It's time to reign him in.
They praise
his inventive work,
and they make him an offer.
They tell him,
"We'll give you a raise."
"We'll put you in charge
of a section, a department."
"You'll be a department head,"
you know, all this...
"We'll give you a white coat,"
you know...
You know, that kinda nonsense,
and, uh...
They made it appealing,
as far as the status,
but they didn't
make it appealing
as far as paying him.
...royalties,
and things like that.
So, he-he just told 'em,
he says, uh...
"No, I'm not gonna let you
own my mind."
...so they won't steal
his inventions.
They wanted him to sign
a piece of paper
that said
everything he invented
belonged to them.
...said with the knowledge
you've developed,
you can't get into business,
uh, competing with us.
My own personal opinion,
it's kinda stretching it
a little far,
like putting a harness
on one's mind.
1952...
The wheels of fate and history
are set in motion.
Walter Shaw resigns
from Bell.
Bell Labs executives
press him to remain,
but Shaw is certain
the federal lawsuit
against them
will have
the desired effect,
paving the way
for him to pursue ownership
of his own
communications company.
He'll wait for Bell
to be unwound
for anti-trust violations.
But in an
eleventh hour negotiation
with the Justice Department,
the lawsuit filed against Bell
was settled
with a consent decree.
AT&T, and its subsidiary,
Bell Telephone,
will control the entire
U.S. telephone system
for another thirty years.
Walter Shaw
is devastated.
At a time in history
when American artists
are being blacklisted
by Senator Joseph McCarthy,
Shaw is as good as blacklisted
from using
Bell Telephone lines.
While Bell controls
the phone system,
Shaw has no place
to practice his craft,
no way to make a living.
Walter continues his quest
to find financial backers.
He finds one con man
after another.
No amount
of knocking on doors
will yield Shaw results.
The Shaw family
begins to suffer.
The family
is forced to live
in an impoverished
neighborhood,
and use food stamps
to supplement
their meager monthly income.
In my child-like observation,
I noticed...
...that even though
that love was there,
there was a new constant,
and that was preoccupation
with getting money
to keep our h-
...our home life going.
My brother and I
were in the same bed
with measles.
Two sick little cookies,
and, uh...
I was woken up with...
...loud voices, about,
"We don't have enough food."
"You need to go
do something."
"We've got
two sick children."
That's scary
for a kid to hear.
Walter requests a meeting
with Bell Lab executives.
He appeals to Bell
to allow him
to use their lines
to hook up his speakerphones.
He, um, showed it to them,
and they says, "Well,
how many you got
of these things?"
He says, "Well,
we've made 200."
He had a very wealthy
investor at that time
who didn't care.
He was a real...
A real chance taker.
And he says,
"Well, that's good."
"You've got the invention,
and it looks beautiful,"
"it works, but how are you
gonna hook it up, Mr. Shaw?"
And my dad said,
"What do you mean, how am I
going to hook it up?"
"I'm gonna... I'm gonna
put it on your lines."
He says, "Can't."
"It's an unauthorized
attachment to our lines."
"We'll never get permission
to market this."
And he came home,
and I was listening
to the argument,
and he says,
"They're not gonna let me
market this."
"I'll never be able
to hook it up."
According to Bell,
it is a crime to compete
against the company,
or even to attempt
to innovate around it.
Shaw is despondent.
He returns to Bell
with a plan.
They would partner
and give him credit,
but he'd have to sign
the rights over to him,
and he wouldn't do it.
They argued about it,
and it was a lot of arguments,
and, uh...
He, uh, found a way
to get around it.
He said, "Well, I'll tell you
what I'll do, then."
He says,
"Then I'll donate them
to the Iron Lung foundation."
So, he donated to them,
and he told them
to tell these people
they can't have the phone.
So, of course,
they made the exception,
and they didn't want
to have that come out
in the newspaper,
so they-
they hooked them up.
There's only 200
of them, though.
And he donated them, too,
and of course,
there was bad blood
with the investor,
he lost his money,
and he didn't make a dollar.
There are no other
telecommunications companies
in America,
and Walter Shaw
needs a job.
He goes to work
for Philco Television.
However, Shaw does not own
the Philco Television store
where he works,
he is a repair man.
The pay is abysmal,
and the work, demeaning.
He was trying to work,
and then do this
on the side,
and it was really hard.
And, uh, I remember that
he was gone quite a bit.
It started out,
just little jaunts,
and then it seemed to me
like he was gone
every other day.
Trying to, after work-
Trying to promote
his inventions.
Meanwhile, the Cold War
is in full swing,
and the Soviet arms buildup
simmers behind
the Iron Curtain.
That's when they asked him
to go to Anchorage
Elmendorf Air Force base
to work on the alert system
for the government.
Bell Labs is a major provider
of scientific talent
for the Cold War effort.
While they were unhappy
with Shaw's exit,
they could not deny
his talents.
Walter joins forces
with a team of America's
most brilliant scientists
and engineers,
most of whom
were taken from Bell.
For one year,
Lieutenant Shaw
works on top-secret
military projects.
Were a nuclear war
to have broken out
between the Soviets
and America,
the most effective route
for missiles from Russia
was directly over Alaska.
Shaw and Bell Lab recruits
were assigned
to design a missile-tracking
radar system,
which would later be called
tropospheric scatter.
They created technology
which will track
Soviet missiles
the moment they're launched
from anywhere in Russia.
Walter works on
the renowned Red Phone system,
which allows
Russia and America
to communicate
during times of crisis.
In an effort to prevent
a knee-jerk nuclear mistake,
the system
he and his team create
uses a phone line
to send a telex
between Washington
and the Kremlin.
These are some of
the happiest days
for Walter Shaw.
He is doing
what he loves,
and he is respected for it.
Shaw is discharged.
After doing brilliant work,
he returns home
to face the same
dire circumstances
which he had left
only one year before.
They came back
to Florida, and, um,
he met a young guy
from Miami Beach, um,
named Ralph Satterfield.
Ralph came from
a very influential,
wealthy people
in Miami Beach.
Very, uh, very nice young man.
Engaging, um...
Very friendly.
And, uh...
At this point,
I can safely say
Dad was probably feeling
pretty desperate.
Ralph said,
"I know some people"
"that can open some doors
for you."
"I have an uncle..."
...who was a renegade
type of guy,
in Canal Street,
New York.
He owned this very posh,
wealthy, jewelry store.
They used to sell jewelry
to girlfriends, and...
...to mobsters' wives,
and things like that.
So, he took a like
to my dad, and, uh,
put him up
in his apartment.
You know, he had
a place in the city,
and he had a place
on Long Island,
and he said, listen,
stay at the apartment,
let's see
if we can make something work.
So, I had been a jeweler
for years.
I'm half Italian,
so my Italian relatives
lived in Mount Vernon,
a lot of them
were bookmakers.
He made some calls,
and some guys came around,
the next thing we know,
we're moved out of Florida,
up to New York.
Through Sylvester,
Walter and Ralph
meet Archie Gianunzio,
and his boss,
Joe Valachi.
Joe Valachi had been a soldier
in the Lucchese crime family,
and would later
become a bodyguard
for crime boss
Salvatore Maranzano,
until his murder in 1932.
Valachi is now a soldier
in the crime family
headed by
Charles "Lucky" Luciano,
for the Genovese family,
in the crew headed by
mafia underboss
Anthony Strollo.
They had this meeting
with my dad,
and they said,
"We-we make
thousands and thousands
of phone calls,
and, uh, we're bookmakers."
"We're always getting busted
because our phones
give us up."
He said,
"We need to make calls"
"we can't be traced, or..."
"...get caught," so my dad
said, "Okay..."
"Well, give me-
give me a little time"
"to think about this."
Shaw returns
to his hotel
to consider Valachi's request.
He has a family,
and no prospects of work
on the horizon.
There was
frightening instances
where there just
wasn't enough money
to run the household.
I remember, as a youngster,
very clearly,
my brother and I
being herded
into the bedroom.
Dad was away,
and there was two men
pounding on the door,
and my mother put her finger
up to her lips,
and said, "Shh.
Don't say anything."
"Don't say anything."
And this man...
I guess he was there
to serve papers,
he wanted his rent,
and I remember him
saying, "Mrs. Shaw,
we know you're in there."
Walter Shaw goes to work
for Joe Valachi
and Archie Gianunzio.
Shaw comes up
with a design
for what would
come to be known as
"The black box."
...and Walter demonstrates
the black box.
And they love it.
He made a- a prototype first.
And this guy, he says,
"Go to the payphone,"
"call buh-buh,"
and they did.
They went out-
he went outside
to a payphone,
put the dime in.
They were wise guys,
but they weren't smart guys.
Know what I mean?
So he put the dime in,
he says, now stay
in the phone booth,
if the dime comes back,
it works.
So he calls the house,
they had the conversation,
they hang up
th-th-th-the call,
and the dime comes back.
He says,
"Hey, the dime came back."
"The thing doesn't work."
You know, they thought
that's what it meant,
it didn't work.
Walter meets Valachi
on three separate occasions
to discuss his progress.
The wise guys
turned to my dad, said,
"Listen, we like it,
but you know what,"
"that's dangerous,
because if they ever
get onto us,"
"they can get us
with this equipment,"
"and arrest us."
He said, "We want to be
in the boroughs
and different places."
"We want it
to follow us."
So, you plug this
into the wall,
and the phone rings,
and you answer it over there.
And the cops
break the door down,
they can't find
a bookmaker.
So, he puts it in,
and he has them
go outside,
go to another payphone,
dial the number,
and the number
goes to another number.
So long as there's no,
uh, transformer
between the areas,
you could be anywhere
and answer the phone
from here.
Now, a thing called
a carrier phone
that is hooked
to this thing...
...so it follows 'em, see?
He says, "That's brilliant.
That's great."
"So, when it goes there,
it goes there."
"We can't get caught!"
That was the-
That was the-
the prototype
of what would become known
as "call forwarding."
1500 black boxes
are delivered
to bookmakers
across the country.
For the next five years,
organized crime would
successfully conduct
illegal gambling operations
using Walter Shaw's invention.
So, when we were
on a wire tap
for-for a
particular bookmaker...
And it was
mainly bookmakers,
it wasn't anything...
I never had
one of the black boxes
on narcotics.
And that black box
would transfer the call
from that location
to another location.
So, it-it saved them
a lot of, uh,
a lot of legal expenses,
and a lot of individuals
getting arrested
by-by incorporating
this black box
into their operation.
For the first time in years,
the Shaw family
has no worries
about putting food
on the table.
Gianunzio buys Shaw
a Cadillac.
It's a bonus
for his good work.
The crime family also pays
for Thiel's tuition
at a private academy
in New Jersey.
And the FBI is becoming
increasingly frustrated.
In the news,
stories begin to surface
about organized crime
in America.
We are terribly concerned
about the extent
of organized crime
throughout the United States.
Finally...
This was when
the federal crime commission
showed up,
they went up to those guys,
and they were pissed off
because the cops
kept breaking doors down,
finding nobody.
So they made a deal with them.
They took the books-
the bookmakers' books,
they seized them.
And they said,
"All right, we'll give you
back your books"
"if you give us
the equipment."
They wanted
the black boxes.
So the bookmakers decided
they'd have to
have their books,
so in Pelham,
they left the...
...in a car,
and the books
were in another car,
and they exchanged.
The Feds give 'em
their books back,
and they gave
the equipment up.
They grabbed the equipment,
they sent it off
to Bell Labs,
Bell tries to x-ray it,
and try to get
serial numbers on the-
on the, uh, capacitors
and relays,
but my dad
had it all sealed.
He has 'em sealed.
So, they tried to x-ray it,
and they couldn't see it,
because he used to use
black crayon,
and melt it in there
in the epoxy.
So they got
really frustrated,
because they never knew
how it worked.
They couldn't x-ray it.
They couldn't break it,
because by the time
they chiseled it,
it broke all the stuff up,
so they end up with nothing
on their- I mean, nothing.
So they were frustrated,
they didn't know
who was making it.
They had no idea
who was behind this,
as far as the inventor.
FBI has a new target.
They want the bookies,
but not as much
as they want the inventor,
whoever he may be.
Take the box away,
and the bookies
become vulnerable again.
In 1950,
Senator Estes Kefauver
introduces a resolution
in Congress
to establish a committee
on an urgent matter.
The Senate Special Committee
to Investigate Crime
in Interstate Commerce
becomes known
as the Kefauver Committee.
Kefauver holds hearing
in fourteen cities,
and hears testimony
from 600 witnesses,
many of whom
are organized crime bosses.
So, Kefauver found himself
at the head of a committee
that was going to investigate
ah, unions'
labor racketeering
in interstate commerce.
Ah, that committee,
ah, to his advantage,
turned out to be
the first time
when Congressional hearings
were actually televised.
First time i-i-in
American history.
Ah, so, here we have,
ah, subpoenaed
by the committee,
uh, the leading figures
in organized crime
in the United States
brought before the-
the, uh, Kefauver Committee,
uh, people who had never
actually been seen-
Certainly not on-
on live television,
uh, people who, uh,
the public oftentimes
knew their names,
but had never
actually seen them...
Now they're being paraded
before a
congressional committee,
and that's, uh,
that's-that's on television.
Senator John Kennedy
and brother, Robert,
take part in the hearings.
Meanwhile, over a period
of a few years,
Walter Shaw
begins scaling back
building the black boxes.
He's more interested
in developing
his own inventions.
But Satterfield
is not happy.
He needs money.
He takes out an ad
in the Miami Herald...
And he says, "Call me
if you want to make
free phone calls."
And then he calls
my poor dad,
and my dad goes to meet him,
and he had said
he wasn't gonna make anymore.
He'd left, like,
five or six hundred
of these, unfinished,
in a room, and Archie
never got rid of them,
and they banged down
this door
and found
unfinished boxes,
brought the Feds in,
uh, and they had
tracked them to Florida,
through Ralph,
with this ad.
So, it all started
making sense,
and they started
following everybody.
One day...
Dad was in the back bedroom
of this lovely house...
...and I answered the door...
This guy comes to the house,
and he's...
...a guy that wants to buy
one of these boxes.
He asked
to speak to Mr. Shaw.
And...
I told Dad, and he said,
"Just send him back."
And my dad says, um...
He smelt something right away,
he says, "No."
He says,
"I don't have any."
Finally my dad
agrees to show it to him.
After ten brief minutes...
...my dad came out with...
...in the room,
with this man,
and he was handcuffed.
His hands
were behind his back.
He was very quiet.
And as he went out the door
with this gentleman...
...he said,
"Call your mother."
That's all he said.
And I watched
as he walked my dad out,
put him in the car
and drive off,
I was horrified.
Shaw, Gianunzio,
and Satterfield
are arrested.
In the press,
they call Shaw's black box
a "parasite."
The evening
of the arrest,
Walter's son, Thiel,
is locked in
the school infirmary
awaiting word
from his mother.
Fellow students
slide a newspaper
under the door
the next morning.
It says, ah, they feel
this is the brains
behind the, uh,
infamous black box
bookmakin' ring.
And it named
what the equipment did.
"Illegal equipment
busts bookmaker."
Thiel Shaw is expelled.
Upon his return home,
he confronts his father.
I had become truant in school,
and I became hard to handle.
I'd form my own street gang,
and wouldn't go to school.
When I was in the sixth grade,
I got kicked out,
and I was getting in fights,
and my mother
couldn't control me,
so she was telling
my dad this,
long distance, every night.
She says, "He's out of hand,
he's..."
"He's robbing with kids
in the neighborhood."
"They're stealing..."
It was horrible.
I rebelled against the fact
that when my dad
had came home,
that sho-short time,
it skirted the issue
of what was really...
'Cause I-I didn't
want to believe...
...that he was a bad guy.
Not only has Walter
lost his way,
but he has
lost his son, too.
I feel he knew
they were bad guys,
and-and I feel that,
uh...
He didn't want to be seen
in that light.
He didn't want to be seen
as a bad guy, too.
Walter Shaw is arrested
by Florida state police,
and subpoenaed to appear
before the Senate
permanent subcommittee
on investigations
of organized crime.
John F. Kennedy gets elected
President in 1960.
He appoints Robert Kennedy
as his Attorney General.
And that unleashes
all of the law enforcement
investigative apparatus
of the federal government
to get organized crime.
The hearings are run
by Arkansas Senator
John L. McLelland.
Senator McLelland
and Attorney General
Bobby Kennedy
confront the five
crime families.
The nation's underworld
get's the unwelcome spotlight
of publicity,
as the Senate's
investigation subcommittee
begins new hearings
on crime.
Arkansas Senator
McLelland is at the helm.
Senator McLelland
was chairman
of the permanent subcommittee
on investigations.
He chose John Kennedy
to be on that committee, also.
Uh, John Kennedy was able
to have, ah, his brother
Bobby Kennedy, uh,
as an attorney,
as-as council
to that committee.
Organized crime,
one of the biggest businesses
in America,
has many faces.
Some are well known,
like that of the gambler,
operating the roulette wheel
which is not only illegal,
but fixed.
Another is that
of the narcotics peddler,
trading on the misery
of the poor.
There are other faces,
those of racketeers
who engage in extortion,
prostitution,
corrupt labor relations,
and bootlegging.
The reason racketeering
can flourish in our society
depends, however,
on some other faces
not so well known.
There is
the racket's leader,
seeking protection
from the law.
And there is
the public official
who offers it
for a price,
daily betraying his position
of honor and trust
in his community.
The hearings illustrate
the ruthless behavior
of the mafia,
and its use of violence,
fear, and corruption
to build its business.
He didn't actually say
that he would kill me
in a restaurant,
but he said they would
find my body
off the Belt Parkway,
which was practically
the same thing.
The first mafia witness
to testify
for the government
is Joe Valachi.
The American public
will have a first-hand account
of mafia activities,
in their living rooms,
on national television.
And the man
who welcomed Walter Shaw
into the highest level
of organized crime
in the United States
is now turning
on his own.
These hearings
always attract
a large number
of spectators.
This one is
particularly crowded,
awaiting the first
public appearance
of Joseph Valachi,
the convicted hoodlum
whose confessions to the FBI
have reportedly put a price
of $100,000 on his head
by the infuriated mafia.
Ah, Valachi himself, ah,
was a low-echelon individual,
member of the Genovese family,
what they call a-
a soldier.
Uh, he had been imprisoned
in a massive, ah,
uh...
...prosecution of members
of the Genovese family.
While he was in prison,
uh, he was told
that he was marked for death.
Uh, and one day
he sees an inmate
heading towards him
in the prison yard.
Uh, he believes that this
is the inmate, in fact,
who has been chosen
to kill him.
Valachi strikes first,
uh, kills-kills this inmate,
only, of course, to discover
he had- he had killed
the wrong-
the wrong individual.
Whatever trouble
Valachi was in before,
now he was even
in-in-in more serious trouble.
Uh, and as a result of that,
he says, you know,
"I've got a secret, too."
Valachi betrays
all the crime families:
Gaetano Gagliano,
Giuseppe Profaci,
Joseph Bonnano,
Carlos Marcello,
Sam Giancana,
Vincent Mangano,
Vito Genovese,
and Carlo Gambino.
Ah, now there is
a very, very strong feeling
that Valachi was actually
paraded before
the McLellan committee
on behalf of the Federal
Bureau of Investigation.
The Federal Bureau
of Investigation,
as we all know,
had been involved
in illegal wiretaps,
and they had done that
for decades.
Uh, so they had all this
wonderful information
about organized crime,
and they couldn't use it.
So what they did was,
they debriefed, uh, Valachi.
And how did they
debrief him?
They asked him
a lot of questions
that, in fact, disclosed
what they already knew
as a result
of these tapes.
So Valachi comes before-
before this committee,
filled with information,
in fact,
that was provided for
by the FBI, uh,
and begins to talk
about organized crime
on the highest levels,
which he couldn't possibly
have known about.
He was able to name all the
players of the major families
and who they represented
and what they were,
how it worked, consiglieres
soldiers and earners
and, you know, associates
and, uh, you know...
he really labeled it all.
He really broke it up
for Americans,
showed 'em how
it all worked.
Joe Valachi, Walter Shaw's
original crime family contact,
is now the most wanted
man in America
by five mafia crime families.
Collectively known
as La Cosa Nostra.
Valachi breaks
his sacred vow
according to the Sicilian
code of omert.
Omert, which has its roots
in the Italian word for "man,"
means literally being a man.
Now of course, a man does
not go to the authorities.
If somebody does harm to
him or his families,
he takes care of its, uh,
of it himself.
It, it means actually much
more than a code of silence.
It's the code of being a man
in the machismo sense.
Uh, how, how did you
happen to go into
the union business?
The local 19?
I respectfully decline
to answer
because I honestly believe
my answer
might tend
to incriminate me.
I "respectiful" decline to
answer the question.
Did you feel that
the working man
was having a difficult time
that you could help
and assist him?
I respectfully decline
to answer.
I refuse to answer
on the grounds
that it may tend to
incriminate me.
I respectfully decline
to answer
because I honestly believe
my answer might tend
to incriminate me.
I respectfully decline to
answer
because I honestly believe
my answer might tend
to incriminate--
Are you a racketeer
and gangster?
Walter Shaw takes his
14-year-old son, Thiel,
to the senate hearing on the
day he must testify.
Thiel catches Joe Valachi's
eye and waves.
Valachi ignores him.
He asks his father.
I ask why he wasn't coming
over to say hello,
and he says he can't.
Cause I didn't know any
different. What did I know?
I didn't know the difference
between the good guys
and the bad guys.
They were all,
all in the same room.
In what can only be described
as one of life's cruel ironies,
Young Thiel Shaw
encounters Carlo Gambino
in the senate chamber hallway
during the hearing.
Carlo Gambino, head of
the Gambino crime family,
is active in racketeering,
gambling, extortion, drugs,
prostitution,
and murder for hire.
Carlo Gambino shares
his personal point of view
with young Thiel Shaw.
He says, Thiel, he says,
remember one thing
about all these people
and these senators and
these lawyers
and these judges,
they have a license to steal
and we don't need one.
They're the bad guys,
not us.
Your dad's a good man.
It's Walter Shaw's turn
to testify.
He had halted making
the black boxes,
so he has no money
and no attorney.
Senator McClellan
questions him
and Walter Shaw
makes a fatal error.
They had all
the head officials
that worked with my father
at Bell
were there,
testifying against him.
And they had told him
he'd made this,
he had made the very first
alarm that called the police.
He had another pe--
he had another invention
he was working on.
They, they asked him
all those things,
he says, yes,
I'm an inventor.
And I've got a lot of, uh,
like the speaker phone
was brought up and
McClellen was impressed.
He says, I'm very impressed
with your knowledge
of the telephone system,
how it works.
He says, you're, you're,
you got a lot of people
saying you're this
great genius.
But um...
They asked him about the
box and my dad took the fall.
Senator McClellen
to Walter Shaw:
"I am asking you.
Is it your intention to plead
the Fifth Amendment?
Do you feel that it might
tend to incriminate you
if you answer truthfully
the question:
Are you the inventor
of such a device?
Mr Shaw:
Yes, sir, I am the inventor.
Shaw apologizes
to McClellen
and the committee.
Senator McClellen replies:
Mr. Shaw, try to go forth
and sin no more."
Father and son
return to Florida
where Walter is later
tried and sentenced
for his complicity
in illegal gambling
and for unauthorized
attachment
to Bell telephone lines.
What did I think? I thought
that, uh, my dad lied to me.
His kids looked up to me
as a hero because my dad
was this notorious thing they
painted in the newspapers
and they lived next door
to me, but it was,
it was not good.
It was terrible.
He is given one year
and a day
in Florida's Dade county
jail.
He serves 9 months.
I was with my grandmother,
his mother was still alive
then. My grandma. My nana.
And um...
and she says, well Thiel,
I want you to take me
to see your dad every week
and I said,
well, I'll, I'll take you but
I'm not going to see him.
I didn't see him the whole
time he was locked up.
Not one time.
With their many hours on
national television
in pursuit of mobsters,
Senators McClellen
and Kefauver
become national media
celebrities.
It gets down to
personalities,
now I didn't know.
It's not, uh, the Senator
McClellen, is it?
Senator Kefauver becomes
the running mate
with Adlai Stevenson
in the 1956 election
for the presidency.
It's, you know, Valachi kind
of drops off the radar.
I'm not even quite sure what
happened.
I know that the man is dead,
you know, of natural causes.
I don't know what the actual
advantages
were bestowed on Valachi.
Uh, he was not prosecuted
for murder,
which he could have been,
uh, and he again just goes
off the radar.
Uh, he was unimportant
prior to him being brought
before the committee and
returned to his obscurity
after the committee
hearings.
Walter Shaw returns home
from prison to find his son
has changed dramatically.
He says, well I've been
locked up for nine months
you didn't even
come see me.
He says, why?
Father and son cannot
reconcile.
He says, I guess you blame
me for all this, huh, Thiel?
I said, no I blame you
for lying to me.
We were all upset about
what was happening
to my, our family and to my
dad in particular
and he's all of a sudden
infamous.
His name is being said over
the news stations
but it's not in a way that we
ever dreamed.
After Walter's release
from jail,
he seeks financial partners
to help fund his inventions.
His struggles continue.
They had bankrupted
the company
that had the patents
cause he transferred them
into the, into the company.
That was a way of not
paying the, the royalties.
They could still manufacture,
still market,
still sell the idea,
and trash the,
the royalty contract.
And I told my dad, I says,
you're, you're just not
gonna let these people
just do what they want.
He says, well what do you
want me to do?
And I said, well, what do you
think Archie would do?
What do you think any
of those guys would do?
He says, I don't think
the way they do, Thiel.
I said, well,
if you want their respect
you gotta put 'em on ice.
And he says, I don't think
that way.
So I told him. I says, well
then,
that's where me and you
divide, cause I would.
You would?
I said, in a minute.
I wouldn't blink an eye.
Not a hesitation.
I wouldn't even
think about it.
I defend my family
at all cost.
He said, well,
I, I don't think that way.
We don't have the same,
uh, blood running through
our veins then.
His family is disillusioned.
Frightened.
It is more than they
bargained for.
My brother was talking
on the phone.
I was standing outside the
room and I came in
because I heard his voice...
get higher and higher and
angrier and angrier
and upset and just,
just in turmoil
and took the receiver
and he's telling,
saying, "No, no, no" and...
he starts beating
his own head
with the headset
of the phone
and he's slamming
his head with it...
hard, hard, hard...
and he starts
to go down to the floor
cause he's beating himself
in the head.
Beating so hard
that he's losing his balance
and he's going down
to the floor.
Once Thiel gets
out of the hospital,
it isn't long
before he goes hunting
for Archie Gianunzio.
Knowing Archie is
connected,
Thiel uses him as his back
door into organized crime.
Over the coming years,
Walter Shaw
continues inventing with
hopes of finding backers.
Thiel seeks solace
in revenge.
He begins to work his way
up the crime ladder,
working for associates
of Archie Gianunzio.
At first he does deliveries
for the mob.
He learns the business.
He resented the rich,
and that resentment would
grow to a point where
he lost his, his uh.
sensibilities about...
what was right and wrong,
but for him, anger took over.
In 1956, a company
named Hush-A-Phone
attaches their equipment
to Bell lines.
They are halted immediately
and charges are filed
for illegal attachment.
Well the Hush-A-Phone
case was very important
for competitive telephony
because
it cracked the door open
for attachment of
non-Western Electric
or non-Bell devices to
AT&T's telephone network.
The courts rule against Bell.
Bell Telephone Tariffs
on the Hush-A-Phone device
are unwarranted
interference
with telephone subscriber's
right to use his telephone
in ways which
are privately beneficial
without being detrimental.
In 1968,
Carterfone attaches
their equipment
to Bell telephone lines.
Once again,
Bell halts their business
and charges are filed
stating Carterfone illegally
attached to their lines.
Carterfone decision was
very important in 1968.
It opened the door a little bit
wider for competition
with the Bell system.
Uh, they had already
become the largest
monopoly, largest
corporation in the world.
So Carterfone was an
acoustically coupled device
for the purposes
of transmitting data
over a telephone network.
So it was a device that you
would take a handset
and set it inside of it
and you could transmit
and receive
via a device that, uh,
touched the network,
but without any electrical
connection.
By the 70s, uh, the courts
had become impatient
with these big monopolies
and again,
the FCC upheld AT& on Carterfone
and the courts overturned,
uh, the FCC and said,
this is ridiculous.
You've got to allow
foreign attachments
onto the network.
Both courts handed
down decisions
in favor of the defendants,
stating that they may attach
equipment
to the Bell telephone lines
as long as attachments were
not damaging Bells service.
These cases are watershed
moments and a turning point
for telecommunications
in America.
But in 1972, they do not help
Walter Shaw.
In Florida, Shaw makes
another mistake.
This time he uses
Bell phonelines
to test a tone generator.
Bell's own internal
security force
and is watching Shaw
and listening.
He is arrested again.
My dad had an uncanny
ability to understand...
the telephone system.
He was a threat. He was a
threat to the day he died.
During his trial,
Walter's lawyer argues that
Bell has a vendetta
against his client.
Bell argues that
he made phone calls
bouncing off Bell lines.
They file charges against
him
for theft of four
telephone calls
and for illegal attachment.
Shaw reiterates to the court
that he was only testing
his equipment.
His objection falls
on deaf ears.
Walter Shaw is sentenced to
four years in federal prison.
It amounts to one year
in prison
for each alleged phone call.
In the mean time, with
Archie Gianunzio's help,
his son, Thiel, continues
to move up the ladder
of organized crime.
So we can, we can
completely understand.
Not agree with it
necessarily,
but understand
why individuals living in a,
uh, in depressed economic
conditions being
discriminated against
would, uh, find organized
crime attractive
as...economically.
I was very bitter
at my dad's...
lack of business sense
and lack of sticking up
for himself.
And I knew he could
cause you,
I've seen it before.
He was angry at daddy,
he was angry at the world,
he was angry at the rich,
why shouldn't,
why can't that be us?
My dad deserves that,
you know, well...
I think one of the,
the biggest effects
on my brother's life that
changed, changed him so
was to have this wonderful
man that had taught us
the true meaning of
integrity.
He lied to, to us.
He lied to my brother
and it changed him.
The Dinner Set gang
becomes well-known
to the police when Pete
Salerno, Dominick Latella,
and their crew including
Thiel Shaw,
commence robbing
hundreds of homes
across America.
The Dinner Set Gang.
You know we were
professional high rise,
you know, second story...
high line thieves.
Thiel drops his nickname
and takes the name Walter.
What the Dinner Set Gang
would do was uh,
after reading these
architectural magazines
or getting information
from various jewelers
and fences in the area from
Atlanta to, uh, to Miami
about the comings and
goings of these individuals.
They would, uh, they would
go surveil these locations
and they would set up, uh,
why they say dinner set,
they would set up
around dinner time
and observe the comings
and goings
of that, of that
particular location.
And one time he, um, he
had uh, ran with
the older guys in the group,
Peter Salerno,
Dominick Latella, um, and
Walter had split off with them
when they found out what
they were stealing from him,
portions of the profits and
the proceeds that they made
from the burglaries
they did together.
Thiel leaves dinner set
to form his own
younger band of thieves
using the same method
he learned from them.
Walter was a little more
sophisticated.
He was a little bit more
dedicated
just to doing burglaries.
He had a younger squad.
He had a crew
that he had trained.
Shaw confronts his son
about the direction
his life has taken.
He says, Thiel, what are you
doing here?
And I said well, I'm
straightening out
what you should have done
years ago.
He says, what's that?
I said, we got into it anyhow
and he says,
well uh, if you if you're
doing what I think,
I'll turn you in myself.
I said, we're through.
I said, because see,
I don't see me
in the way you do.
I see...a man slaps me
on one cheek,
I'm gonna slap him on his.
You know, it's like
the old verbiage...
you don't go to
a gunfight with a knife.
So that's the, my philosophy.
So we just...we pull away
totally at that point.
We were, we were done.
MCI files an antitrust suit
against AT&T in 1974.
While Walter Shaw
is in prison,
the most important event
in the history
of telecommunications
has happened.
The department of justice
is convinced
MCI is right in their claims
and they follow suit.
They also file against AT&T.
The fatal anti-trust case was
filed by MCI in 1974.
And MCI stood for
Microwave
Communications Inc.
It was simply, wanted to
create a link
between St. Louis and
Chicago using microwave
and then interconnect into
the AT&T system.
Uh, so...
you got not only a change in
the economic climate
and the interest groups
involved,
but you also got a change
in a political climate,
uh, the whole deregulation
theory,
the deregulation of the
airlines,
the, both the democrats and
the republicans at that time
were pro-deregulation.
And uh, before you knew it,
you had the justice
department
supporting this
anti-trust case
and eventually ordering
the breakup of AT&T.
While Walter Shaw serves
his time in federal prison,
others make attempts
to enter the telephone
business.
I was thumbing through the
paper one day
and found a telephone
answering bureau for sale.
Uh, it was in the town
of Bel, Air Maryland
and they had, accumulated
about 75 customers.
At that time,
they provided, um...
telephone answering
services, which is uh,
essentially messaging
services for doctors
and people that needed
emergency communications.
Ottensmeyer knows
Bell is a monopoly.
How is it safe to enter
a telephone business
which requires attachment to
Bell telephone lines?
Well, it was uh...
a business that was
sanctioned by, uh, AT&T.
They provided the
equipment, meaning,
switchboards, operator
switchboards that we used.
They provided all the lines,
and it was an area that
apparently they did not want
to serve,
uh, because of probably
the liability associated
with emergency services.
So it became a niche
business that...
uh...
other entrepreneurs stepped
up to, to fill the shoes.
Ottensmeyer's business
begins to increase.
He leases more equipment
from Bell to accommodate
his growing customer base.
In March of 1979,
they resided my premise
with the Maryland
state police
and telephone company
AT&T security personnel.
They came in armed with a
search warrant
and uh...
the door was open
so they just walked right in
and...
one of my operators, uh,
came back and got me.
It was early in the morning
and said there's a whole
bunch of people
and policemen
here to see you.
They said they were there
to...
uh, that I had been operating
an illegal telephone service
with illegal equipment.
Um, I knew what they were
talking about
because we had openly
provided this service
at that time, uh, and what
they ultimately did
was walk out with
the eight diverters,
uh, the equipment that we
used to provide the service.
Suddenly his life
is upside down.
If Ottensmeyer's company
was a Bell telephone
customer,
why would they raid his
home and business?
It's a mystery to me.
They they could have asked
me about it at any time.
They were in the answering
service premise
maybe three or four times
a week repairing lines,
hooking up new customers,
you know, making
adjustments
to the switchboards.
The final judgment allows
the sanctioned emergency
switchboard to continue
provided Ottensmeyer
does not operate it
or enter the premises.
The problem is, the
premises for his business
happens to be in his home.
Ottensmeyer is never
allowed
to set foot there again.
They did not want me
to compete with them
and they were...
afraid they were,
would lose revenue.
I was considered
a competitor.
It will take another four
years for Bell's monopoly
to be undone.
After his release from
prison,
Walter Shaw goes
on the road from city to city
with his inventions
under his arm.
He maintains his faith
that life will turn around.
He tells his wife over
and over again,
I only need one deal
and our life will be better.
He had people that would
represent his,
quote, his office,
and sell the servers
and have people
sign the agreement
to subscribe to the service.
But I got the impression
that he,
it attracted a lot of people
that were taking advantage
of Walter
and they were selling
the service,
but they weren't furnishing
the call system.
He just was not really,
and I hate to be blunt,
not a very good
businessman.
Father and son cannot
reconcile their differences.
It will be many years
before they meet again.
It was never really
the same between us
ever at that point.
I would, he, I think my dad
was tolerable
of my decisions
but I think he was
heartbroken and, and...
disappointed how
my life was going.
Thiel has two great kids.
Uh, my niece and my
nephew and uh,
we were there
for birthday party
and Thiely had a beautiful
home in Emerald Hills
and there was just a group
of us, my mother, my aunt,
her sister,
the two kids, and uh, my
brother's former wife
and um,
we were sitting in the kitchen
having birthday cake
and...
my brother came in the
kitchen door
and I almost fell off the...
chair.
He came in with,
uh, two or three of his uh,
dinner time gang.
And he had a big sack
like a bad Santa Claus.
He had a big sack on his
back filled with goodies
that didn't belong to him
and he had some
black stuff on his face
so they wouldn't shine
in the dark.
That was, that was reality
walking in that door
as a bad Santa Clause
with a sack on his back.
I mean, that just stopped
the party right there.
Thiel and his jewel heist crew
rob as many as eight homes
per night.
They hit different states
at different times of the year.
It is a seasonal business.
Well anyway, he
was involved in some major,
um, major uh, uh, burglaries
and major robberies.
On, on his own he started
his own, own little crew up,
you know, and uh, uh, was
also a, there wasn't control
but he also had participated
with some major
organized crime individuals
in the selling
the jewelry
or whatever they, that they
were involved in.
He did something one time
that really hurt me and...
I had an answer, uh, I had
a knock at the door one day,
late, late as I remember it,
and uh...
he said would you keep
some stuff for me?
Just for a little while?
And I said what stuff?
He said, just, just some
things
and, and things are kinda
hot right now.
And um...
I said okay...
what, what are we doing?
He said, I wanna put it
up in your attic.
And I said, okay.
And...I couldn't refuse him.
But when he left I cried
because it was the first time
I ever felt unloved.
I felt like he wasn't
thinking
that he was putting me
in jeopardy
because I could have gotten
in trouble
if the police were following
him
and I willingly accepted
stolen goods
and put them up in a safe
place for him.
An organized crime task
force is set up specifically
to get Thiel Shaw and crew.
We were more motivated
when, when they started
hitting the homes that they
were, they were living in,
in the area.
Uh, you know, when they
went to Miami
or, we wold pass on the
intelligence to other,
you know, other intelligence
agencies.
But it was really ticking
the, uh, the, uh, bosses off
when, when these guys
were hitting local houses,
right in their own
neighborhood.
That's when we said that's
it, you know,
we've had enough and uh,
we've uh, we've I had a
group of 44 guys under me.
44 guys in a city our size.
We had tactical everything
was under me.
After a 15 year crime spree,
Thiel is caught by Broward
county detectives.
He will spend 11 years
in a series of state prisons.
Florida state prison,
Lawtey correctional
institution
and Sumter.
Walter was indeed probably
the greatest jewel thief
that ever lived.
I will still maintain
that I never
committed that burglary.
Thats right.
Actually, he was an official
suspect
in more than 100 burglaries
when these pictures were
taken
and suspected on the side in
thousands of others.
Walter is hated by many
law enforcement officials
throughout uh,
this tri-county area.
8 years later, he finishes
his sentence
at Lawtey correctional
institution.
As he exits he prison,
his father is entering the
same one
for a probation violation.
Walter Shaw's wife of 44
years, Betty Lou,
has just died.
In his depressed state,
he stops reporting to his
probation officer.
Walter Shaw is compelled
to serve the balance
of his prison sentence.
Thiel loses touch with his
father completely.
A lifetime.
Probably...
20 years, 25 years.
Somewhere around there.
We'd run into each other
through the years
by accident, strictly.
Like for instance, he, he, he
got violated on probation
and when he got out
after my mother died, uh,
he had prostate cancer.
I didn't know it.
And the doctor just
happened to be my doctor
and she calls me from
Beaches hospital and says,
uh, I just, I just operated
on
a man
that has prostate cancer
and he's got your name.
And I said,
is he an older man?
She says, yeah,
he's slightly older.
And I says, really?
I says and what, what'd
you do to him?
She said I had to
castrate him
to try to stop the
progression
of his cancer and...
I said, well I'll come down,
where's it at?
And I drive to Beaches
hospital and it was my dad.
And uh, he had just gotten
out of jail, you know.
And I said, well what are you
doing here?
And he says, well...
then he got choked up
and he said I, you know,
they had to castrate me
and he was a little weak and
groggy from the operation
and I said, well I'll come
back tomorrow and see you
and I came back and he was
gone already.
He'd gone back to Reno.
With his wife Diana,
Thiel finds his father
living in a bus station
broke, starving, and
shattered by life.
He was the early stages of,
he'd, he told me at the party,
he said, I have 18 months
left to live.
And I didn't want us
to die this way.
On June 13th, 1980,
a jury in Chicago awards
MCI 1.8 billion dollars
in damages to be paid
by AT&T.
For nearly 80 years,
Bell telephone
vigorously blocked or
eliminated competitors
from the communications
industry.
Is that how you feel?
You feel like it was a war?
Yeah.
There's no doubt about it.
Why do you say that?
We were the good guys
and they weren't.
Um, they wanted to stop us
from making a living,
feeding our families,
bringing good things to
people that helped them
that they didn't want
to do themselves.
What did they want to do?
They wanted to make
money
and they wanted to control
the telephone system.
The AT&T system,
uh, had...
uh, fought it in the 70s.
They created, uh, a bill,
known as the Bell bill
in the mid 70s it was, would
have re-legitimated
monopoly
and reasserted monopoly
and they were
just hooted down.
I mean, it was clear by that
time it was AT& versus the rest of the
economy
and uh, despite the support
of the defense department,
um, they were indeed
broken up.
Which is really still quite a
remarkable achievement
of uh, the Reagan, uh,
anti-trust department,
that they actually did that.
Uh, but it was an explosion.
It was the big bang of
telecom policy.
It was something that just
completely reset the terms,
uh, for telecommunications
uh, for the 21st century.
In January of 1982,
AT&T was forced by Judge
Harold H. Green
to divest itself
of the wholly owned
Bell telephone operating
companies,
which halted Walter Shaw
from making a living
and pursuing his dreams.
On January 1st, 1984,
the Bell monopoly was dead.
What exactly was this
marriage of big government
with big corporation?
Was this a unique
relationship?
It was not.
The marriage of Bell
with the government
is what economists call
corporatism.
Fascism is corporatist.
I mean, there's no,
it's not an extreme,
fascism was corporatist.
And Mussolini, uh, was the
one who kind of
first promoted the idea,
well the Italian fascists
were the ones who developed
the idea of corporatism.
AT&T was the epitome of, uh,
kind of a corporate
structure.
You had a very powerful
labor union,
The Communication
Workers of America.
You had the biggest
corporation in the world,
uh, with a monopoly,
a government sanctioned
monopoly
and you had them working
very closely
with the government on
things like uh,
uh, national security
technologies,
uh, um...
wire-tapping, uh you know,
providing information
to the government about
who was doing what,
uh, you have a consolidated
stakeholder group.
This is what big business
wants.
This is what government
wants.
This is what the
representatives
of labor want.
And that's what happens.
America is a democracy.
It is a free society.
Yet it employed a fascist
economic structure.
But that was 90 years ago.
The question is...
can it happen again?
Today, elements of
corporatism are still active
in America where
corporations
representing different
groups exist
to influence government
legislation through lobbying.
While these corporations
have no membership,
in any legislative body, they
wield considerable power.
American corporatism is
alive and operating today
as reflected by
the relationships
between members of the
former Bush administration
and corporations
such as Halliburton.
Circumstances like these
further support the notion
put forth by critics
of capitalism.
They argue that any form
of capitalism
will eventually devolve
into corporatism.
Where concentration
of wealth
is in fewer and fewer hands.
The administrations of
presidents Carter, Reagan,
Bush Sr., Clinton,
and Bush Jr.
favored deregulation policy
throughout their
respective terms.
The idea was to let big
business, big corporations,
big banks, operate with less
government interference,
unlike the Bell structure.
In 1999, the financial
services modernization act
is enacted in the 106th
United States Congress
under President Clinton.
Banks, securities houses,
finance companies,
and insurance companies
will be allowed to merge
and consolidate at will.
Soon, investment brokers
will create and sell
high risk, virtually
worthless investment products
to commercial banks
which will result
in one of the greatest
economic catastrophes
in American history.
Uh, the United States
had organized crime
on a, on a scale that
uh, uh was way, way
beyond that of what
ethnic groups
like Italian-Americans and
Jewish-Americans brought.
Uh, we know the whole story
about the,
about the robber barons.
Uh, we know about
the Rockefellers.
We know about
the Vanderbilts,
uh, we know about
the people who indeed
are organized crime
on a, on a, on a level
uh, that uh, perhaps
is being repeated again,
uh perhaps being
repeated again
by corporate America.
Big business in cooperation
with big government
worked together to take
the country
to the brink of disaster.
How does their
behavior differ
from the criminal behavior
we know
as organized crime?
Well, first of all, the
difference is that they,
the individuals
who are doing it
at the corporate level
of America
are certainly making money
way beyond anything
ever dreamed of,
but the kind of organized
crime that titillates all of us,
uh, American Mafia groups.
So, thats a, an important
difference.
Uh, I provide in
my research, in my books
a definition of organized
crime.
I would suggest seven
of those attributes
could certainly fit all of
the, the corporate
criminal activities that have
become,
uh, well known to all of us
as a result of media exposure.
Perhaps the only one, and I
would have to be cautious
about saying that we're not
gonna include that one,
the only one was that the
willingness to use violence.
Big corporation,
big government,
big stakeholders,
capitalist, socialist,
regulate, deregulate.
In the end, what do these
words mean
to a democracy?
What do these words mean
to Walter Shaw?
These words are ideologies.
Methods of government,
manipulations of power.
Economic rationales.
And they profoundly affect
every level of our society
for decades,
even centuries at a time.
While there are no easy
answers to explain
why we are,
where we are today,
there are also no easy
answers
as to what to do about it.
At very least, as members
of a free society,
we have the opportunity to
educate,
to demand truth,
to object, to reject,
to demand clarity from those
who serve us,
supply us, and govern us,
and to speak up when
wrongs are not righted.
It's all we've got.
Winston Churchill said this:
"We accept in the fullest
sense of the word,
the settled and persistent
will of the people
all this idea of a group
of super men
and super planners making
the masses of the people
do what they think
is good for them
without any check
or correction
is a violation of democracy.
Many forms of government
have been tried
and will be tried in this
world of sin and woe.
No one pretends that
democracy is prefect
or all wise.
Indeed,
it has been said that
democracy
is the worst form of
government,
except all those other forms
that have been tried
from time to time
but there is the broad
feeling in our country
that the people should rule
continuously rule
and that public opinion
expressed by all
constitutional means
should shape, guide, and
control the actions
of ministers who are their
servants
and not their masters.
I says, why do you think
we never benefited?
I said, what, what do you
think it was all about, dad?
He said,
I never questioned it.
I just know I had the gift,
the ability and the blessing
from God to do what I did
and I never ever
questioned him
but he says,
you know what, Thiel?
It doesn't matter what
anybody says about me
'cause my inventions will
speak long after I'm gone.
Walter Shaw
would live to see
the dismantling
of Bell telephone.
But many years
too late for him
and his family.
- Final question.
- Mmm.
If your father
walked in here right now,
what would you say to him?
Greg, I don't know.
I'd ask for another day.
And that would be a gift?
That would be a gift.
Isaac and Thorald Koren:
"For One More Day"