Professor Walter's History Lessons

For every revolution in technology, there has to be a first step

Today we live in the era of the smart phone with touch screens and flip keybaords. But all of these devices can trace their heritage back to IBM. In 1992, at COMDEX, IBM introduced the Simon, made in partnership with Bellsouth. By removing the keypad and incorporating a touch-sensitive LCD,, it broke the mold in what was expected in a mobile phone. With a DOS OS, it also included an array of applications, such as a calendar, calculator, address book and world clock. It even had the capabilty to send faxes!

All at a price of $899, with a Bellsouth cellular service activation, and $1,099 without.

With a brick like shape reminicient of the 1980s and weighing in at a pound, the smartphone had limited commercial appeal, especially considering its price. In the end only about 2000 were produced. Yet this primitive device is the great-great-great grandfather of every smartphone on the market.

-Professor Walter

The finest alternative cancer treatment from Yugoslavia

Promoted by Yugoslavian physician Stevan Durovic, Krebiozen was touted as a miracle cancer cure. It's chief U.S. advocate was Dr. Andrew Ivy, who referenced studies showing amazing recoveries in patients who injected the drug. Announcing the drug at a press conference in 1951, Ivy claimed that of the 22 treated patients, 14 were still alive and that those who had died had died of unrelated causes. Independent researchers, however, were unable to confirm any of the claims and published their concerns in the Journal of the American Medical Association. Ivy claimed that there was a conspiracy against the drug and dismissed the report.  Afterward, the Krebiozen Research Foundation was founded by Durovic, with Ivy as president.

In 1959 Ivy began to sell his version under the name Carcalon and by 1963 some 5,000 patients were being treated with the drug. Many were convinced that they would have died without the medication, leading some politicians to begin promoting it. At the time the U.S. Government did not monitor the effectiveness of drugs and, despite mounting evidence that Carcalon was, at best, ineffectual in fighting cancer, they were powerless to take action. Until, that is, the 1961 Thalidamide scare prompted the passage of the U.S. Kefauver Harris Amendment, or "Drug Efficacy Amendment," an amendment to the Federal Food, Drug, and Cosmetic Act. This new law required drug makers to provide proof of effectiveness and safety of drugs and regulated advertising.

The newly empowered FDA set their sites on Carcalon. Despite congressional hearings and cries from the public of the government overstepping their authority, an investigation began. Initial attempts by the National Cancer Institute to procure samples were met with resistance from Durovic, who proposed selling Krebiozen to them for $170,000 per gram. Eventually samples were released for free. Analysis determined that Krebiozen contained mineral oil and creatine monohydrate.  Examinations of samples collected prior to that point found that in some the creatine monohydrate was not even present.

As the evidence that the drug was ineffective mounted, public sentiment began to change. Criminal charges were brought against Ivy and others. After eight days of deliberation the defendants were acquitted, though the decision was a legal one and not based on medical facts.

-Professor Walter

Behold the lastest great invention! Cotton on a toothpick!

In 1923 Leo Gerstenzang observed his wife putting cotton swabs on the end of toothpicks. he like his wife's invention and created pre-made cotton swabs on a stick and marketed them as Baby Gays from his new company, the Leo Gerstenzang Infant Novelty Co. In 1926 Gerstenzang revised the name to Q-tips^® Baby Gays eventually dropping the Baby Gay name and sticking with Q-tips^®.

Product sales took off after WWII and in 1958 Q-tips^® purchased Paper Sticks Ltd. of England, and incorporated paper sticks into Q-tips^®. All this because a husband paid attention to his wife and knew a great idea when he saw it.

-Professor Walter

Quick! Make a movie! But don't make it too good. And do it cheap.

Contstatin Film, a German film company, purchased the rights to make a Fantastic Four movie. However, the contract giving them the exclusive rights stipulated that the filming be completed by a deadline in order to retain the rights. In 1992, the deadline was fast approaching and the estimated forty million dollars necessary to make a blockbuster Fantastic Four movie was not available. The company turned to filmmaker Roger Corman who accepted the challenge: make a bare-bones movie at minimum cost.

They never intended to release the low-budget film. But the actors and public were never told that this was just a place holder until the big-budget movie could be made. They worked diligently, for low salaries. They were told that if the movie did not go to theaters it would be a pilot for a TV series. Filming lasted only one month and the cast went on to give interviews and appear at conventions. A premiere date of 1994 was set, but in 1993 it was announced that the film would not be released because of its budget.

For $1.5M, Constatin Film created a movie that they never intended to release. They retained the rights and more than a decade later they released a big budget Fantastic Four movie which grossed $330M. To those interested, there are a few bootleg copies of the "never to be released" film floating around.

-Professor Walter

The case that hung by a thread

The intrauterine device (IUD) has been around, as a form of birth control, for over a thousand years. It is mentioned in the Talmud and in the writings of Hippocrates. It was a well known device, used for its effectiveness and because it could be removed at will. Despite its lengthy history, the science behind why an IUD works is still not fully understood.

In the 1960s, the first plastic IUD was approved by the FDA and hit the U.S. market. In the subsequent years other IUDs followed as the market for the product grew in the face of health concerns about the "Pill." It seemed probable that the IUD would someday replace the Pill as the default birth control method.

At the time the FDA did not require testing of IUDs. The manufacturers would test for effectiveness and little else. In this environment the Dalkon Corporation developed the Dalkon Shield IUD, then sold their design to the A.H. Robins Company. in 1971 the product hit the market with a heavy advertising blitz. There were two designs, a larger one marketed toward mothers and a smaller version for women who had not yet given birth.

There were warning signs early on that problems were inevitable. As with many other companies, the only study conducted on the Dalkon Shield was to test its effectiveness, not safety. The man who created the device, Hugh Davis, M.D., worked on the study himself. In a serious case of conflict of interest, he would receive a percentage of the profits from sales of the IUD. Even before Robins purchased the design, scientists reported problems with the research, which claimed the Dalkon Shield would reduce the rates of infection and expulsion of IUDs. Additionally, the Dalkon Shield had been tested with concurrent use of spermicidal foam, skewing the results about its effectiveness in pregnancy prevention.

The aggressive marketing campaign was a success, with about 2.8 million IUDs sold at its peak. What those users didn't know was that there was a "confidential" memo floating amongst Robin's top officials. The memo indicated that there were problems with the string, meant to allow the woman to "feel" that the device was still in place and for easy removal by a doctor. Other IUDs used a mono-filament nylon string, similar to fishing line. The Dalkon Shield, however, used a "string" comprised of 200-400 individual plastic filaments inside a plastic sheath. The memo indicated that the string had a tendency to break down. 

The danger therein lies with the environment of the uterus and vagina. The vagina is constantly moist, harbors numerous naturally occurring bacteria, and is susceptible to outside, non-native bacteria as well. The uterus is a sterile organ, and the string of an IUD bridges the two. In other models of IUDs the link is safe and sealed naturally because of the type of string used. In the Dalkon Shield, the multi-filament string allowed for bacteria to travel into the uterus. To make matters worse, the plastic sheath, made of Nylon-6, would disintegrate, opening more pathways for bacteria to enter. Robins was aware of the problem, but, despite the risks, pressed forward with the IUD's release.

Concerns were raised almost immediately. Women returned to their doctors complaining of bleeding and pain during sex. Doctors diagnosed them with PID (pelvic inflammatory disease), which can be caused by normal bacteria, chlamydia, or gonorrhea. Antibiotics took care of most of these cases. Bigger problems came when it was determined that the "as advertised" failure rate of 1.1% was not accurate -- it actually had a failure rate of up to 10%. Women were getting pregnant, often resulting in spontaneous septic abortion. In the worst cases, the infection was so bad that it turned fatal, resulting in at least 18 deaths. When faced with a flood of complaints, Robins took the Dalkon Shield off the market in 1974 and began a multi-year legal defense.

Robins claimed that the devices were safe, that infections were the result of poor hygiene and unsafe sex practices. Unfortunately, tying the symptoms definitively to the Dalkon Shield was difficult to prove. The suits (400,000 or so of them) went into the 1980s, when they organized into a large class action lawsuit. By that time, even women who had not experienced symptoms found that they had scarring, often resulting in infertility. Additionally, during the removal procedure the uterus was occasionally torn due to the unique shape of the device. With financial preassures mounting, Robins declared bankruptcy in 1985. In 1988 the American Home Products Corporation purchased Robins, with the stipulation that a $2.5 billion trust fund be established to pay out settlements to those injured by the Dalkon Shield.

The 122 year old A.H. Robins Company was brought down by a product that sold for $3. Due to the length of the court cases, it was ultimately the lawers who made the most from the process. Even then, though, hiring a lawyer was probably a wise decision. The average claimant without a lawyer received only $725.00, while those with lawyers received an average of $21,000.

-Professor Walter

Those french fries are simply too thick

In 1853 American Indian George Crum was working as a chef at a resort, Moon Lake Lodge, in Saratoga Springs, New York. The menu included french fries which had been popularized by Thomas Jefferson who discovered them as ambassador to France and served them to guest at his home in Virginia, Monticello. On a summer day a picky customer sent back his french fries stating that they were too thick. Crum made a thinner batch which the customer again rejected. Crum was fed up with the customer and decided to make a point. He cut the potatoes as thin as possible and fried them until they were so crisp they would break if poked with a fork. His plan backfired when the customer loved the new dish and other customers began to request it.

The newly minted "Saratoga Chips" were a smash hit. They were packaged and sold locally, eventually Crum would open his own restaurant featuring the chips. In the 1920s Herman Lay would popularize the chips in the south while Bill and Sallie Utz would do the same in the mid-atlantic region.

Today the potato chip industry exceeds 6 billion dollars annually and employs over 65,000 people -- all because of one picky customer and a fed up chef.

-Professor Walter

The Pesky Fox and the Cobalt Silver Boom

In 1903 the Temiskaming and Northern Ontario Railway was under construction across Canada, to help colonize the north.  Fred LaRose was a worker who found an unpleasant surprise when he went to eat his lunch. A fox had decided to eat it first. To make matters worse, the fox made a habit of frequenting LaRose's lunch, leaving a frustrated LaRose hungry. Then, one day in mid-September, LaRose spied the furry thief and hurled his hammer at the fox. His aim was off, or the fox was too quick. Instead the hammer hit rock and broke off a piece, revealing something unexpected: a vein of silver.

The discovery made headlines and Canada's mining industry was born. The Cobalt mines produced an astonishing yield of 460 million ounces of silver, far greater than that of gold in the Klondike during its ninety year run. Finally, in the 1990s, the silver ran out.

LaRose made a million dollars with his role in the find. There is no word on any compensation the fox received.

-Professor Walter

The 1882 Chinese Exclusion Act

The post Civil War westward expansion saw the United States grow faster than every before. New and improved technologies such as the telegraph and railway linked the far flung states such as California with the original colonies. This rapid growth brought with it a large surge of immigration, mainly from China, to provide a work force to build the railways and mine raw material from the earth. Early on corporations would bring people from their native countries to the United States for this purpose.

However as the rails were finished and the immigration continued many US citizens found themselves to be out of work and saw the Chinese immigrants as a treat to their livelihood. Many claimed that the immigrants would work for less than any man could reasonably live on and as such jobs were scarce. In direct response to the public outcry against the influx of cheap Chinese labor the Chinese Exclusion Act was signed into law by President Chester A. Arthur on Mary 8, 1882. 

The law banned immigration from China for "skilled and unskilled laborers and Chinese employed in mining" as well as denying citizenship for Chinese immigrants in the United States thus creating a permanent alien status. If a Chinese alien left the country they would be denied reentry. This was changed two years later with an amendment that relaxed that rule. The result of the immigration ban was human trafficking as more sought to come to the US. Initially the law was only supposed to last ten years, but it remained in force until is was repealed in 1943 by the Magnuson Act. While the new act allowed Chinese to become citizens; it limited the number allowed to emigrate to 105 per year. It wasn't until the Immigration Act of 1965 that immigration restrictions were normalized and a entry to the United States was granted on a fair basis regardless of country of origin.

-Professor Walter

The man who single-handedly launched the United States into a depression

Jay Cooke was possibly the most important banker during the Civil War and post-war period. His clever advertising helped increase the sale of war bonds which, in turn, helped to fund the Union. After the war he founded the famous banking house "Jay Cooke and Company." Then, abruptly, on September 18, 1873, he closed the doors of his bank forever. A panic ensued and thirty seven other banking houses and brokerages shut their doors that same day. The Stock Exchange followed, and by the end of the year over five thousand business had failed.

What Cooke did is not too far removed from the shady banking exploits we hear of today. Beginning in 1869, he invested heavily in the Northern Pacific Railway. The railway was considered a high risk venture. Not only were new trains being constructed across the west at unexpectedly high costs, but the model itself was flawed: linking together small towns in the wilderness is not particularly profitable. Railroad Baron Cornelius Vanderbilt, who understood the industry well, pinpointed the problem with the investment strategy:

"Building railroads from nowhere to nowhere is not a legitimate business."

Not unexpectedly, Cooke's get-rich-quick endeavour failed, leading to the ruin of thousands of others in the process. After the collapse of his banking house, the Northern Pacific Railway slipped into bankruptcy in 1875. When the depression he sparked finally ended in 1879, Cooke was able to recover enough to pay his debts, but he never rose to prominence again.

Ironically the Northern Pacific Railway persevered through many difficult economic times, and on March 2, 1970 it was consolidated with other railways into the Burlington Northern Railroad. This nearly 100 years after it played a pivotal role in the financial collapse of the United States.

-Professor Walter

A fractional currency curiosity

During the Civil War there was hoarding of gold, silver, and other precious metals. This impacted the ability of the United States to stamp coins. In 1864, Congress authorized fractional currency notes in denominations of 3, 5, 10, 15, 25 and 50 cents. Spencer M. Clark was the first superintendent of the National Currency bureau, now known as the Bureau of Printing and Engraving, at the time and his office was given the task of creating the notes.

A controversy erupted when the third issue of the 5 cent note was released and Spencer M. Clark's face was on it. Different theories came about to explain how he ended up on the note, including one that states Clark, known for being part of the famous duo Lewis & Clark, was supposed to be there. Regardless of the reason, Congress was furious. A law was immediately passed, retiring the 5 cent note from circulation as well as forbidding any living person from appearing on federal coins or currency. Clark nearly lost his job over the incident, but continued to serve in the role until 1868.

The Act of April 7, 1866 outlined the rules for persons to be placed on notes.

Portraits on bonds or notes: living persons,--No portrait shall be placed upon any of the bonds, securities, notes, fractional or postal currency of the United States.

-Professor Walter