E620 CONGRESSIONAL RECORD — Extensions of Remarks April 22, 1998 The problem of mergers: The spate of TRIBUTE TO NATHAN SHAPELL success in view of the immense obstacles that mergers in the last five years has raised con- impeded their path makes their stories all the cerns, particularly about competition in in- HON. TOM LANTOS more remarkable. dustries where there are fewer and fewer One other element that is also common to competitors. The proposed Lockheed-Nor- OF CALIFORNIA throp deal, for example, would have limited IN THE HOUSE OF REPRESENTATIVES these five outstanding business leadersÐthey are ``Founders'' of the U.S. Holocaust Memo- competition in government contracts for key Wednesday, April 22, 1998 weapons systems, including airborne radar, rial Museum here in Washington, D.C. They missile warning systems, and military air- Mr. LANTOS. Mr. Speaker, on Thursday of have shown a strong commitment to remem- craft production. Likewise, the government this week, representatives of the Congress, bering the brutal horrors of the Holocaust, successfully blocked the proposed merger of the Administration, and the Supreme Court will paying honor to its victims, and working to Staples and Office Depot because the merger gather in the Great Rotunda of this building for prevent the repetition of this vicious inhuman- would have effectively eliminated competi- the National Civic Commemoration to remem- ity. tion for certain office supplies in certain ge- ber the victims of the Holocaust. This annual Mr. Speaker, Nathan Shapell is one of the ographic markets. national memorial service pays tribute to the five Holocaust survivors and leading American Antitrust enforcement will often involve a six million Jews who died through senseless entrepreneurs highlighted in this article. Nate fact-intensive weighing of the competitive and systematic Nazi terror and brutality. At is the Chairman of Shapell Industries in Los costs and benefits of a proposed merger. this somber commemoration, we will also Angeles. As we here in the Congress mark Companies involved in the merger may honor those heroic American and other Allied argue, for example, that the merger im- the annual Days of Remembrance in honor of proves economic efficiency by cutting over- forces who liberated the Nazi concentration the victims of Nazi terror, I ask that the profile capacity in the industry as well as overhead camps over half a century ago. of Nate Shapell from Fortune Magazine be costs, or that the merger is needed to keep Mr. Speaker, this past week Fortune Maga- placed in the RECORD. pace with overseas competition. Regulators zine (April 13, 1998) devoted several pages to [From Fortune, April 13, 1998] will, in turn, try to assess how the proposed an article entitled ``Everything in History was NATHAN SHAPELL—CHAIRMAN, SHAPELL merger affects choice and price for the con- Against Them,'' which profiles five survivors of INDUSTRIES sumer, whether the consumer is the U.S. Nazi savagery who came to the United States government, a small businessperson, or a pri- Nathan Shapell’s history illustrates two penniless and built fortunes here in their truths about the Holocaust. First, by sharp vate citizen. Regulators rarely block merg- adopted homeland. It is significant, Mr. Speak- ers outright, but rather seek to work with and courageous use of his wits, a Jew could the parties to limit anti-competitive effects. er, that four of these five are residents of my often greatly improve his chances of surviv- home state of California. My dear friend Na- ing. Second, in the end he practically always The problem of monopoly: Monopolization than Shapell of Los Angeles was one of the needed luck as well. is a related concern for antitrust regulators, Now 76, Shapell (originally named as demonstrated most recently by the Jus- five that Fortune Magazine selected to high- light in this extraordinary article, and I want to Schapelski) was the youngest of five children tice Department’s battle with Microsoft, the in a family that lived in the western Poland computer software giant. Antitrust law has pay tribute to him today. city of Sosnowiec. After the Nazis invaded never been construed to say that merely be- Nate Shapell, like the other four singled out Poland, though, the father and two of his cause a firm is dominant it is engaging in il- by Fortune Magazine, has a unique story, but children scattered, leaving Nathan, then still legal monopolistic conduct. If a firm domi- there are common threads to these five tales in his teens, the only male in a household of nates a market because of superior skill or of personal success. The story of the penni- four. Growing up quickly, he got decent energy, antitrust steps aside. If, however, a less immigrant who succeeds in America is a work in the city’s sanitation department and firm engages in unreasonably exclusionary familiar theme in our nation's lore, but these also gained the favor of certain German offi- or anticompetitive activities to stay on top, cials by managing to get them scarcities that kind of behavior will be challenged. The stories involve a degree of courage and deter- mination unmatched in the most inspiring of such as textiles and meat. For nearly three rationale is that monopolies tend to stifle in- years Shapell’s standing with these Germans novation, which in the long run hurts the Horatio Alger's stories. not only kept his family safe but also al- economy and the consumer. These men were, in the words of author lowed him repeatedly to help other Jews. Our new high-tech economy presents a dif- Carol J. Loomis, ``Holocaust survivors in the In the summer of 1942, however, Shapell’s ficult challenge for antitrust. On the one most rigorous sense,'' they ``actually experi- mother and hundreds of other Sosnowiec hand, high-tech companies like Microsoft enced the most awful horrors of the Holo- Jews were rounded up and incarcerated in a have been on the cutting edge of innovation, caust, enduring a Nazi death camp or a con- part of the city called Targowa. Frantic but transforming our economy, generating jobs centration camp or one of the ghettos that able once more to tap the help of his Ger- and wealth, and boosting our competitive- were essentially holding pens for those mans, Nathan got past Targowa’s guards on ness in the global marketplace. On the other the pretense that he was going in to survey camps.'' the sanitation needs of the area. Making his hand, high-tech companies, particularly They picked themselves up ``from the very those that enjoy a dominant market posi- way through crowds of desperate Jews, he fi- tion, may have opportunities to exploit con- cruelest of circumstances, they traveled to nally found his mother, gave her food, and sumers and crush potential rivals. The con- America and prospered as businessmen. They promised her help. cern in the Microsoft case, for example, was did it, to borrow a phrase from Elie Wiesel, But he also realized that the sanitation that the company was using its dominance when everything in history was against them.'' arm band he wore might be the key to more in the computer software industry to squeeze They were teenagers or younger when World rescues. Later that day he told the authori- out competitors in the market for Internet War II began. They lost six years of their ties that Targowa’s sanitation needs were software. large, and secured permission to go into the youth and six years of education. ``They were area at least daily with a small crew. Over Government regulators have tried to strike deprived of liberty and shorn of dignity. All lost the next few days, he and his men entered a balanced approach in this area. They rec- relatives, and most lost one or both parents. just before a shift change for the guards, ognize that the high-tech industry is dif- Each . . . was forced to live constantly with with each member of his crew wearing a ferent—that companies must constantly in- the threat of death and the knowledge that sanitation arm band—and with a few more novate to stay ahead of their competitors arm bands stuffed into Shapell’s pocket. and that government does not want to inter- next time he might be `thumbed' not into a line These he gave to male prisoners, who each fere with this beneficial process. They rea- of prisoners allowed to live, but into another day exited, trying to appear nonchalant, son, nonetheless, that the high-tech sector is line headed for the gas chambers.'' Through with the crews and their refuse-loaded carts. not immune to the risks associated with mo- luck and the sheer will to survive, these were The discovery of this ruse would almost cer- nopolies, and will take steps to ensure that some of the very fortunate who lived to tell the tainly have meant death for all concerned, companies play by the rules. story of that horror. but the guards on the new shifts never Conclusion: I accept the need for antitrust The second part of their stories is also simi- caught on. enforcement. After all, the economy is in the larÐa variant of the American dream. These Next Shapell focused on the huge pots of midst of an unprecedented wave of mergers. courageous men came to the United States soup that were each day carried into Antitrust authorities should review the com- with ``little English and less money.'' Despite Targowa and later taken out empty. Shapell petitive effects of proposed mergers, pro- their lack of friends and mentors, they found and his men instead filled them up with vided such reviews are based on facts and small children (warned to total silence) and careful market analysis, not ideology. The the drive to succeed. As Loomis notes, ``many then boldly carried out the posts, as if they government must be careful not to do more millions who were unencumbered by the were simply helping with the day’s chores. A harm than good. Free markets may some- heavy, exhausting baggage of the Holocaust half-dozen or so children, most thrust at the times fail, but it does not follow that govern- had the same opportunities and never reached men by their parents, were rescued that way ment can make things better. out to seize them as these men did.'' Their and released outside the gate. One, a small April 22, 1998 CONGRESSIONAL RECORD — Extensions of Remarks E621 girl of 5 or 6, looked up from the street where So it was that when the three men make it been taken off me.‘‘ It hardly ranks with the Shapell had set her and said, ‘‘Where shall I to the U.S. in the early 1950s, they had some first, of course, but he calls that day his go?’’ He answered, ‘‘Child, I don’t know. Run, money. They went first to Detroit because a ‘‘second liberation.’’ run.’’ As he tried to talk about that moment relative lived there. But Nathan didn’t like f recently, Shapell broke down, unable to fin- Detroit, and they traveled in search of an- ish. other landing spot, thinking that either su- EARTH DAY, 1998 In a week of arm bands and soup pots, permarkets or homebuilding might be their Shapell did not manage to rescue his mother. future. They hit California, and for Nathan He finally succeeded, though, on a chaotic it was love at first sight. ‘‘Just the trees,’’ he HON. BENJAMIN A. GILMAN day in which the Germans encircled all of says today, ‘‘just the smell from the oranges OF NEW YORK Targowa’s Jews with a gigantic noose of rope and lemons. It was unbelievable, beautiful.’’ IN THE HOUSE OF REPRESENTATIVES and prepared to load them up for transport. Through a Detroit connection, they met Shapell’s mother escaped because Nathan, one night with a young building contractor Wednesday, April 22, 1998 talking his way into Targowa, found her and in Los Angeles, Morley Benjamin. Knowing Mr. GILMAN. Mr. Speaker, Earth Day helps made her lie down on a pile of dead bodies. their English to be inadequate, the three He then contrived to get the job of removing visitors brought with them a taxi driver us to remember that environmental issues the bodies for disposal and got his mother to hired to be a translator—but he kept falling know no political bounds and affect all of the safety. asleep. The meeting came to nothing. people, plants, and animals of the world com- By the summer of 1943, though, the Nazis’ Some months later, though, having picked munity. It is essential that the policies our vicious campaign to make Europe up more English, the three went back to Government enacts, and the personal activi- Judenrein—free of Jews—had wrenched the Benjamin, and this time they struck a deal ties we undertake reflect our profound concern family apart and sent each of its members to to build houses together. The Shapell group for safeguarding the Earth. a work camp or a concentration camp. The put in $600,000, and Morely Benjamin and a hellhole of Auschwitz-Birkenau was Na- partner contributed expertise. In two sub- From combating global climate change to than’s lot, but there his youth and relative urbs of Los Angeles, Norwalk and Whittier, protecting threatened species to maintaining vigor got him thumbed into line of people to they built some 2,400 houses and sold them to clean air and pure water standards, we have work, not die. He was then tattooed with the veterans for $10,990 each, no money down. a duty to act locally and globally to protect the number he still wears: 134138. Nathan, the leader of this band, badgered the environment for present and our future gen- In the nearly two years of captivity, hun- young builder he always called ‘‘Mr. erations. ger, and oppression that followed, he contin- Benjamin‘ to teach him everything he knew Saving the planet may seem to be an insur- ued to be sustained by wits, guts, and a about the business. Remembers Benjamin: mountable task, but in order for our children to steely resolve to survive. He smuggled food ‘‘Nathan was constantly in my office, con- out of kitchens, hid when exposure would stantly wanting to know. Once I said to him, have a brighter future we must commit our- have meant death, and got himself classified ‘Nathan, do not come back for at least an selves to an environmental policy which seeks as a carpenter though he could barely drive hour.’ ’’ But Benjamin says Shapell never to establish a clean, safe, and productive envi- a nail. But there was a moment near war’s asked the same question twice. He was, be- ronment. end, at a work site called Gintergruber, when sides, a whiz with figures. We must not forget the air we breathe, our nothing else counted but luck. One day a In 1955 the parties split up, amiably. most precious resource. Americans can clearly prisoner in his work crew escaped. When Shapell, with his relatives, formed S&S Con- see, smell, and feel the difference that pollu- none of the other prisoners would admit to struction and proceeded to build anew in knowledge of how he’d gotten out, SS troops Norwald. He has always had a belief, he says tion has made in their lives. As a strong sup- lined them up—some 200 men, in ranks four today, that a prudent man should keep one- porter of the Clean Air Act, I understand the deep. Shapell was in the front row. The SS third of his money in cash and another one- need for clean air standards. So too, we must counted down it, ordering the fifth man to third in good ‘‘stuff,‘ and then if he wishes, not neglect our efforts to purify our water. By step forward, and then the next fifth man, put the other one-third at risk. But in 1955 encouraging innovation, cooperation, and the until ten prisoners were lined up for all to he felt the Norwalk project required the development of new technologies for pollution see. The ten were then shot. Shapell, in the commitment of everything he had. Out of it, reduction, these standards build upon the spir- 80% of the front line that survived, went though, came a small profit, enough to send it of ingenuity that is the foundation of Ameri- back to work. S&S Construction on its way. Shapell was later moved in a forced march Since then the company now called ca's leadership in the world. to a camp called Waldenburg. Freedom ar- Shapell Industries has built 64,000 houses and Moreover, the issue of global warming is rived there on May 8, 1945. No German guards spread well beyond Lost Angeles. The com- one that affects us all. Without our interven- came that morning to make their daily head pany is known for high-quality building, for tion, global warming will find sea levels con- count, and in the afternoon the camp’s com- astute purchases of land, and for conserv- tinuing to rise, an increase in heat-related mandant drove out for the last time, his eyes ative financial behavior in an industry that deaths, increased allergic disorders, and other venomous as he looked back at the prisoners tends to binge on leverage. Shapell himself serious air quality programs. watching in disbelief. The Jews then dresses down from the elegant suits he wears By burning oil, coal, and natural gas to swarmed out of the camp to scavenge for in his office and ‘‘walks’’ his sites, doing food, on the way encountering Russian sol- hands-on quality control. He is not apt to power our cars, heat our homes, light our cit- diers who were still at war, even though Ger- stop those inspections soon: For three years ies, and through deforestation and clearing of many had surrendered the day before. a widower, he usually works at least six days land for agriculture, we are releasing green- The world called them ‘‘displaced persons,’’ a week and has no plans to retire. house gases to the atmosphere more quickly and in the next six years Shapell, 23 at the In his business history, there is a period than we can remove them. end of the war, became a leader in aiding that caused him anguish. In 1969, when his Over the last century atmospheric levels of homeless Jews who bore the label. His place company was doing about $30 million in sales these gases have steadily climbed and are of work was a small Bavarian town named and $3 million in profits, he took it public Munchberg, where he established a model DP and was immediately sorry. Impatient by na- predicted to increase as global economies community. He oversaw the construction of ture—‘‘he has the attention span of a gnat,’’ grow. The Intergovernmental Panel on Climate houses and even set up a large home that says an acquaintance—he could not abide Change (ICC) estimates that global surface air took in Jewish children with no place to go. dealing with securities analysts. He feels, temperature will increase approximately an- Wrote an American officer who had author- moreover, that the homebuilding business, other 5 degrees in the next 100 years. The ity over Munchberg and knew himself fortu- with its cycles, weather delays, and general ICC also predicts that ``the balance of evi- nate to have crossed paths with this young ups and downs, is not well suited to a public dence suggest that there is a discernible refugee: ‘‘I heartily endorse Mr. Schapelski market that craves consistency. ‘‘If you are human influence on global climate.'' With this as an energetic, efficient, trustworthy, and honest and reporting exactly what happens,’’ most capable man.’’ Shapell says, ‘‘Wall Street tells you good- in mind, we need to act now to protect our For Nathan, Munchberg meant more than bye.’’ His company was itself a case history planet. work well done. He was married there (to a in volatility. In 1981, when interest rates I invite my colleagues to join with Secretary Holocaust survivor) and was joined in the skyrocketed, it lost nearly $10 million on of State, Madeleine Albright, in her pledge to town by two siblings who turned out to have revenues that exceeded $300 million—another announce ``A full court press to encourage survived the war, Sala and David. (The re- period of acute anguish for Shapell. By 1983, meaningful developing country participation in maining four members of Shapell’s family through, the company was making $15 mil- the effort to combat global climate change''. are either known, or believed, to have died.) lion on revenues cut by a third. Eventually Nathan, David, and an Auschwitz So in 1984, Shapell took his creation pri- As chairman of the International Relations friend of Nathan’s who Sala married, Max vate, buying in the 28% of the company that Committee, I understand the importance of Weisbrot, secured a permit to start a textile the public owned for $33 million. Best money using our leadership in the United States to manufacturing and wholesaling business, and he ever spent, says Shapell: ‘‘when we’d done assist other countries in developing and main- it did well. the deal, I felt like a million pounds had taining successful environmental programs. I