Original subtitles

By the early 20th century,

the battle between the entrepreneurs of excess

and the forces of abstinence has reached a fever pitch.

This is America, we like our vices.

You've got the industrial revolution happening,

yet the third richest man in the world

owns a cigarette manufacturing company.

Anti-vice crusaders

have made Prohibition the law of the land.

But now the underground is fighting

to push its way into the mainstream.

Al Capone is so easily recognized,

but more so than presidents and captains of industry.

As the mob fuels the spread

of illegal gambling,

one man will completely reinvent the gaming experience.

You're over the limit.

I said deal me in.

And rewrite the laws that govern it.

By 1910, all casinos were the illegal in America.

Horse racing was basically outlawed by 1919.

While another fights against

sexual repression.

We make a magazine, full nudes.

Paving the way for a new definition

of the luxury lifestyle.

We call him the Marlboro Man.

And it all culminates

in a new city in the desert

that offers every indulgence under the sun.

It's gonna be spectacular.

♪ Hey, hey, I did it and hey, hey ♪

♪ I proved it and hey, hey ♪

♪ I finished, I came, and I saw, I gave it my all ♪

♪ I changed the game I made it a boss, yeah ♪

Reformers spent years fighting

to ban the sale of alcohol.

And it looked like they'd won when the 18th Amendment went

into effect in 1920,

but after more than a decade of Prohibition,

things aren't going as they planned.

One thing that Prohibition doesn't do

is eliminate alcohol.

Makes it a little bit harder to get it,

makes it a little bit more expensive,

but anytime, something that people want is made illegal,

it immediately creates a black market

where people who are bold enough,

daring enough, can capitalize on it.

Because you've now pushed it underground.

You have organized crime, mafia bosses.

Saw it as an opportunity.

They wanna go full blast in it, and they do,

and they make millions.

At the height of Prohibition,

Al Capone's criminal syndicate alone generates

the modern equivalent

of nearly one and a half billion dollars.

And in the depths of the Great Depression,

Americans have never been more desperate to indulge.

America's in the worst economic depression

in its history.

Unemployment, nationally, is 25%.

In industrial cities like Detroit, it's 40%,

and public mood switches, to a degree,

in the 1930s as people realize

how much they miss having alcohol around

and how unsuccessful Prohibition

is in keeping alcohol away from people.

Another thing that people don't realize is

that marijuana was legal then

and became much more popular during Prohibition.

There were so called tea pads,

more than 500 of them all over New York City,

where it was legal to go in there and get stoned.

♪ Da, da, da, da, da, da, da, da, da ♪

Finally, on December 5th, 1933,

Prohibition is repealed.

♪ Da, da, da, da, da, da, da, yeah, the beat comes ♪

When Franklin Roosevelt was elected,

he was elected in part because he promised

to bring beer back.

The idea was, the country really needed tax revenues.

♪ It's the time of my life ♪

There was just this common sense realization

that we killed off one

of the most thriving industries

in America, let's revive it.

And also let's tax it.

By that time,

less than 8% of what we're once 1300 breweries

are still alive.

One of them is August Busch's Budweiser

and the brewery roars back to life.

We got two bids in from potential vendors

if you wanna take a look.

Let's go with this one.

In the first year after Prohibition,

the government rakes in over 250 million dollars

from taxes on alcohol.

Funding new roads and highways, public buildings,

and bringing electricity to every corner of America.

Alcohol has been illegal, it's been legal, illegal, legal.

It's crazy how many times, back and forth,

they've been changing the laws on alcohol.

But at the end of the day,

it makes a lot of money for the government.

Finally, Budweiser is back on its feet.

There you go.

Prohibition translated into the closure of thousands

of saloons and the shutting down of hundreds,

and hundreds, and hundreds of breweries.

No one's been allowed to look

at the financial records of the company,

but it seems as though August Busch

was looking at possibly having to close the doors.

When Prohibition ended, they're back in business.

While Prohibition has been repealed,

some states opt to stay dry.

And in Tennessee,

alcohol is still illegal in the county

where Jack Daniels is made.

So company president, Lem Motlow,

spends years lobbying the local government

to let him operate.

Bouncing back after Prohibition

was especially difficult for Jack Daniel

because Tennessee extended their Prohibition

another five years passed the federal mandate.

Lem had to fight a long way to get out of it.

It took him a long time after Prohibition ended

to convince Tennessee to allow manufacture of alcohol.

Yeah.

Then after a five year wait,

Motlow finally gets the news

that the Jack Daniels distillery can legally operate again.

You, you're kidding.

Thank, thank you.

When they reopen,

of more than a thousand registered distilleries

in the state before Prohibition,

they're the only one left.

Motlow rushes his whiskey back to the market,

introducing a one year aged version.

But it isn't until the company is sold

to Brown Forman in 1956,

for the modern equivalent of nearly 113 million dollars,

that it rises again to national prominence.

♪ You can't stop now ♪

Today, it's illegal

to buy booze in the county where Jack Daniels is made,

but it's the number one selling whiskey in the world

with more than a hundred million liters sold annually.

Part of a US alcohol industry worth

over 222 billion dollars a year.

Jack Daniel, if he saw where the alcohol industry

was today, I think he'd be impressed

by what has happened to it.

And he would probably be happy to see

that he'd stayed relevant and stayed strong

through the fifties, and the sixties,

and the seventies, to this giant brand it is today.

♪ Hell can't stop now ♪

Alcohol's now legal for good.

And brewers, distillers,

and drinkers across the country, rejoice.

But for one small group,

the end of Prohibition is a disaster.

After Prohibition, the mob,

they lost this big booze empire.

Those bootleggers who made millions of dollars off

of selling illegal alcohol

have to look for other streams of income.

The former so-called Beer Baron of New York

has lost his primary revenue stream,

and he's looking for a replacement.

His name is Arthur Flegenheimer,

but he's better known as Dutch Schultz.

Dutch Schultz doesn't stand out

because he sets up some elaborate

and clever operation, like Dutch Schultz is a goon,

Dutch Schultz is a hoodlum.

Broadly in the history of organized crime,

Dutch Schultz is among the kind of clumsier,

really sort of brutish organized crime figure.

The reason why he is successful in organized crime is not

because he's organized, it's because he's violent.

At the time,

an illegal Harlem gambling ring, called the numbers game,

serves as the underground heartbeat of the local economy.

The numbers game is a number guessing game

that is an attempt to guess a randomly generated,

three digit number.

Your odds of guessing correctly are one in a thousand,

and the payout is 600 to one.

In some ways, this is both the stock market

and the banking system of Harlem.

The game generates vast fortunes

for the men who run it, called the policy kings.

And for the only policy queen, Stephanie St. Clair.

Stephanie St. Clair, she was a strong woman.

Strong personality, loud, boisterous, flamboyant,

and she knew how to find a woman's place in a man's world.

Instead of being low key, she would step out there,

she would take ads out in the newspaper,

exposing cops that had taken payoffs and such.

She was not afraid to go against the grain.

Stephanie St. Clair is one of the richest

and most famous women in Harlem,

but her publicity is bringing attention

to the success of the numbers game.

Your reputation procedure, Mr. Schultz.

And Dutch Schultz sees an opportunity.

Recently, one of the most popular lucky numbers

in the policy game hit,

sending policy kings all over Harlem into a tailspin.

And you have this big hit, bankers are unable to pay out.

You have bankers that are like $70,000 in the hole.

I might be willing to give you the cash you need.

The mobsters, they were making

so much money during Prohibition off the illegal alcohol,

but when Prohibition ended,

they turned their sites to the policy racket.

Of course, you gotta do what's best for you.

When more well established crime figures take an interest

in the numbers games a lot

of those black numbers operations find

themselves very vulnerable,

'cause they just don't have that level of the experience.

Schultz begins methodically muscling his way

into game after game,

determined to take them all over,

and soon he's got his sight set on Stephanie St. Clair.

While the battle for Harlem's illegal numbers game heats up,

the same vice is bubbling up

from the underground all across the nation,

despite every effort to suppress it.

Americans have always loved to gamble.

In the early colonial period,

colonists who are playing dice games and card games.

George Washington and Thomas Jefferson love to play poker

when it's illegal in virtually every jurisdiction to gamble.

By the 1930s,

gambling is regulated by a patchwork

of state and local guidelines,

and it's almost uniformly illegal.

In California, the fastest growing state in the union,

after a distant history as a gambling mecca

during the gold rush,

it's once again against the law.

There are all of these incentive programs

to have people settle in the west.

There is economic opportunity, there is land.

But, actually, one of the conditions for statehood,

for some western states,

was that they had to outlaw gambling.

In Los Angeles,

a failed movie producer named Billy Wilkerson

has spent years building up

the most powerful publication in Tinseltown.

"The Hollywood Reporter."

Fresh clothes for you, sir?

He's credited with discovering Lana Turner

and launching the careers

of superstars like John Wayne and Clark Gable.

How about an aspirin?

But he's also earned himself a reputation

as an inveterate gambler, losing money all over town.

All in.

I call.

Pair of jacks.

Three of a kind, you're out.

Deal me in.

You're over the limit.

I said, deal me in.

I got a call from accounting this morning.

They said, we're, uh, falling a little short on payroll.

While he's doing all this,

It's evident that he's also suffering from addictions.

He will smoke up to three packs of cigarettes a day,

but worst of all, he was losing, in the 1930s,

at least $150,000 a year at the tables.

I was trying to double up,

give the team some bonuses.

It got so bad that he was taking the payroll on Fridays

and going to the track and blowing it.

There were no organizations like Gamblers Anonymous

or anything that could help somebody who had a problem.

The house always wins.

Wilkerson's addiction

is threatening everything he's built.

His ideas will one day rewrite gambling laws

from coast to coast and give birth to a shining city

of sin that brings in over 8 billion dollars a year

in gambling revenue,

but he'll have to fight the mob for the spoils.

And only one side will win.

Gambling was once prevalent on Missouri

river boats and in New Orleans French Quarter.

But by the 1930s,

it's illegal in nearly every part of the country.

In America, we see this tension

between the urge to indulge and the urge

to quash those indulgences by gambling,

that it's deemed illicit by states

and municipalities all across the country.

Which during the 20th century,

increasingly outlaw gambling.

More and more Americans

are finding ways around the laws

with back room poker games and sports books.

One of the reasons why vices are attractive is

that they are vices and that they are illicit

so there's a certain thrill to know

that you're breaking the rules

or you are challenging certain conventions

about proper behavior.

Drinking to excess, gambling.

There's a certain kind of edge to it

that some people enjoy the fact that they are being bad boys

and bad girls by engaging in these things.

Recognizing the money to be made,

one rising western state recently sent shock waves

through the rest of the country.

In Nevada, you have cow towns and mining towns.

What miners like to do once they

have done well in the mines,

and what cowboys like to do at the end

of a long trail drive is go lose their money.

They like to drink, they like to find prostitutes,

and they love to gamble.

Nevada had the need to develop their infrastructure.

They needed a tax base and gambling was a great tax base.

Nevada realized that you legalize it,

you regulate it, and you tax it.

You make a lot of money.

Rather than fighting gambling,

the Nevada state legislature legalizes it.

Reno quickly becomes the gaming capital of the state,

but far from the glitz and glamor

of today's luxury casinos.

Most establishments are hot, cramped,

and closer to something out

of the old west than to modern resorts.

Most of the gambling joints in Nevada at that time

were sawdust-floored gambling joints.

You'd walk into a gambling center or a saloon,

and it did feel like Deadwood.

It had that dusty gambling feel to it.

It didn't feel clean,

it was almost like backroom gambling built

into the front room.

Billy Wilkerson takes full advantage

of the legal gambling in nearby Reno,

losing money at gambling shacks night after night

before showing up to his day job

at "The Hollywood Reporter."

Looks like old Billy wins.

His ability to create business successes

was almost equally matched by his gambling disasters.

He had no business gambling,

but that's what adrenaline junkie does.

The headlines, George.

As Wilkerson was building

this very successful trade paper,

"The Hollywood Reporter," he was a tough boss.

There were those on his staff who liked him a lot,

but there were those who resented the fact that he

was losing so much money at the gambling tables.

The new Wilder flick?

I like it, run this one.

Okay.

After a string of bad losses at the tables,

Wilkerson realizes no matter what you do,

the house always wins.

This was really the turning point in my dad's life.

It was basically formulated in his mind, since my dad,

more than often lost, if he owned a casino

and played at the casino,

the money was cleverly recycled back to him.

Instead have owing the house, own the house.

And that apparently was the seed planted for Wilkerson

to begin developing this idea.

Wilkerson decides

to risk everything on a gambling joint of his own.

He just needs the perfect spot in Reno.

This along here is all residential.

This whole area is gambling shacks already.

Pool halls, few saloons here.

What about all the way over here?

So Billy gets a vision to go to the outskirts of town,

don't just be another sawdust floor gambling joint.

Looks like little airstrip without hotels.

Yeah but...

Look at the distance, an hour and a half flight from LA.

Go to the outskirts and build the mecca for gamblers.

They'll come from all over the country,

even all over the world.

Las Vegas, what does that even mean?

No idea.

Well, let's go take a look.

Gambling is only legal in

this one tiny corner of the country,

but there's another temptation that's enjoyed by nearly half

of all Americans at the time, smoking.

The cigarette industry is, by far,

the most profitable branch

of American capitalism in the 20th century.

Cigarettes are very inexpensive to manufacturer,

they're easily distributed.

They don't need to be refrigerated, they don't spoil,

and people who use them use a lot of them.

Parks, restaurants, bars, libraries, theaters,

cigarettes change how people behave in these public spaces.

Smoke was ubiquitous.

The cigarette has become the dominant form

of tobacco and Camel owns 45% of the market

with Lucky Strike right behind them at 38%.

One small tobacco company is struggling

to stand out in a sea of competition.

You wanted to see me, sir.

Come in, have a seat.

They're Philip Morris

and they're already trailing

the four biggest tobacco firms in the nation.

Now, an ambitious low level executive,

and British expat, named Alfred Lyon,

is about to inherit the biggest problem

in its nearly 100 year history.

Smoker's cough, what the hell is smoker's cough?

A public relations nightmare.

In the 1930s as more Americans are smoking,

the cigarette manufacturers are increasingly contending

with the fact that smokers don't always

like the way it feels to smoke.

That people's throats get irritated.

At that time, they didn't have an understanding

of the causes of lung cancer.

They didn't have an understanding

of the ways in which smoking caused emphysema

or other diseases, but they did focus on smoker's cough.

I'm promoting you to Vice President of Sales.

This is your problem now.

I'll make it my top priority, starting immediately.

Fix this or you'll be out of a job.

We both will.

Understood.

Al Lyon's visionary leadership

will eventually give rise to an iconic brand

and transform Philip Morris

into the top tobacco company in the nation.

The problem is he'll have to fight a rising tide

of anti-smoking activists

and reinvent an entire industry to do it.

Meanwhile, Stephanie St. Clair and her chief lieutenant,

Bumpy Johnson, have watched

as their own illegal industry is turned upside down.

Dutch Schultz has taken over nearly

every other numbers racket in Harlem.

I don't get why you just won't let me go after him.

We can't afford to start a war we

have no chance of winning.

But I'm tired of doing nothing.

Stephanie St. Clair, she's not ready to back down.

She's not intimidated by Schultz.

Whereas a lot of other people just folded.

If we can't hit him,

we'll hit him in his bank account.

We get every single black person in Harlem

to stop spending money on his game.

Stephanie Sinclair tries

to organize black bankers resistance against Schultz,

and white people in general, in Harlem.

Not another penny at any white owned business

where his policy slips are sold.

We're gonna shut 'em down.

She's kind of drawing off of

that already well established African American campaigns

against white supremacy.

St. Clair is riding a wave of activism led

by influential African American leaders like Marcus Garvey

and W.E.B. Du Bois, who advocate for the community

to buy black, or don't buy where you can't work.

We're talking about folks like Marcus Garvey,

who establishes the first

Universal Negro Improvement Association chapter

in New York City.

These are all race reform leaders and intellectuals.

They are some of the most ferocious,

loud, civil rights activists

and they're very invested in advancing civil rights in ways

that aren't violent, in ways that for them make sense.

Stephanie St. Clair,

she pushes back through community activism

as a kind of act of racial solidarity, right?

So she's working every angle, right?

Trying to protect her corner of New York gambling.

St. Clair rolls out her boycott

and the Harlem community immediately backs her up.

Every single shop has been short, every one.

It's the boycott.

♪ I see them all looking back ♪

Something needs to be done.

Why don't you see what you can do?

Dutch Schultz isn't going to back down.

And there's only one way he knows how

to do business, with violence.

Billy Wilkerson is planning

to build a luxury resort and casino in a strip

of barren desert called Las Vegas.

The term casino was coined by Italians

in the mid 18th century, taken from the word house.

It meant a house of entertainment or gambling.

In Reno it means a dusty old west gambling shack.

Oh no, no, no.

This is all wrong.

Now, Wilkerson wants

to reinvent what a modern casino is from the ground up.

Why would we make someone walk to a different room

to get a damn cocktail?

Somebody who did not have a gambling addiction,

would've made casinos this wonderful place

full of aquariums and bay windows

so you could look out and see the pool.

Everything needs to be designed to cater to the player.

The bar, here

or here.

I'll look into it.

My father was smart enough to know that

if you were gonna keep gamblers in one place,

it had to be rid of every single possible distraction

that you could think of.

These bathrooms should also be closer to the tables.

You get lost in gambling where you don't even want

to think that you're being irresponsible.

You make it very easy to eat or drink,

and you make it for a gambler,

a place that they never have to leave.

Wilkerson isn't just building a casino.

His revolutionary vision will cover more than 30 acres,

offering posh rooms, a nightclub, fine dining,

a health club and spa, even a golf course.

A lot of entrepreneurs,

they know what customers want even

before the customers want it.

Think about Steve Jobs and the touchscreen.

Think about Jeff Bezos and Amazon, buying things online.

To see that innovation is really critical.

This needs to be perfect.

But we are already over budget.

We'll figure out the costs later.

His architects and decorators figure out

how much it's gonna cost and it's 1.2 million dollars,

which is a very pricey resort hotel.

Wilkerson takes out loans to fuel his vision,

one he believes will create a whole new gambling industry.

You can get food, and drink,

and everything you want without having to leave the table.

And he brags about it at a local back room game

to a gambling associate named Johnny Roselli.

Is this in Reno?

Las Vegas.

Never heard of it.

Johnny Roselli is attached to the Chicago mob.

And the Chicago mob sends him out to California

to look after their interests.

The rake'll cover the expenses for the first year,

and by year two, I'll have mansions on both coasts.

Sounds like a good racket.

Johnny Roselli was the mob boss for Hollywood,

which included the entertainment industry.

He saw how great this could be, financially,

in his underworld fashion.

I bid 500.

I call.

All right.

Wilkerson doesn't know it yet.

Pair of aces, not your night, Billy.

But his innocent conversation

with Roselli come back to haunt him, and soon.

Meanwhile, Al Lyon's been tasked

with fighting back against reports of smoker's cough,

and he's digging into every bit

of research Philip Morris's internal lab has

to offer on the side effects of cigarettes.

The goal is to come up with a response on how to deal

with what Al Lyon considers merely bad publicity.

Lyon wanted to deny that cigarettes caused any disease,

to deny that cigarettes were harmful,

and then to promise the public

that they would find the truth.

Have you found anything I can use yet?

Yes, it turns out

when we add a compound called diethylene glycol to tobacco,

it reduces irritation by 35% in rats eyelids.

Rats eyelids.

Diethylene glycol is a chemical

that helps materials, including lung tissue,

retain moisture.

Today, it's better known as antifreeze.

You understand we don't sell cigarettes to rats, yes?

We've also done a human trial.

And?

Well, all 11 test subjects we interviewed claimed

that they experienced less coughing.

The whole idea was to use the cache of science

to make a promise that engineering

and technology could take away whatever it

was that was bad in a cigarette.

Love it.

But like I said, it isn't very-

Write it up and have it on my desk by the end of the day.

Good work.

Thank you.

Now armed with the results of a dubious study,

Al Lyon uses it to launch an all out advertising blitz.

The Philip Morris tobacco company,

at the behest of Alfred Lyon,

began to promote their products in medical journals,

claiming that their smoke was milder.

And that there would be no throat irritation

if you smoked Philip Morris cigarettes.

Philip Morris advertises the fact that three out

of every four cases of smoker's cough are cured

through the Philip Morris brand used with diethylene glycol.

The campaign advertises in newspapers,

magazines, and on the radio,

hoping to reach as many people as possible.

Stephanie St. Clair has launched a campaign

to boycott white numbers games.

And after just a few months,

it's costing mobster, Dutch Schultz, millions.

Yeah, are you sure?

What is it?

You know, Jacob Bay.

The banker who runs the game down near the park.

Shot in the head, left out on the street.

While St. Clair is someone who is obviously tough,

she also understands the consequences

of some of her actions, which could be,

you know, physical violence, death.

We both know who did it.

Dutch Schultz is employing intimidation,

they're kidnapping numbers figures,

in some instances they're engaging in beatings.

They're engaging in murder.

What do you want me to do.

Determined to protect her turf,

Stephanie St. Clair leaves nonviolence behind.

It's rumored St. Clair herself would go

into the stores where white banks were operating

and, you know, smash their stuff in the store,

and threaten them physically.

As violence escalates,

the newspapers start calling the conflict, the Policy Wars,

and they'll eventually leave over 40 bodies dead

in the streets.

And police are forced to respond.

I just got a call from uptown.

Cops had a dawn raid of the place, had to be a tip off.

There's violence coming from the one end,

but then there are police raids coming as well, right?

And there's a sort of stalemate

in who really controls the numbers game.

I want her dead.

Notorious gangster, Dutch Schultz,

and policy queen, Stephanie St. Clair,

have been at each other's throats.

Both trying to control the illegal numbers racket

that's the heart of Harlem's underground economy.

There are millions at stake

and as the so-called Policy Wars drag on,

Schultz puts out a hit on St. Clair.

You scared the hell outta me.

I'm sorry, it's about Dutch Schultz.

He was gunned down at dinner tonight.

I didn't authorize a hit on Schultz.

It wasn't us, it was his own people.

On October 23rd, 1935,

Dutch Schultz is shot at a restaurant in Newark.

Part of the fallout from a court case

that has nothing to do with St. Clair.

Dutch Schultz, he becomes number one, FBI's most wanted.

Not for violence, not for murder, but for tax evasion.

The governor of New York State, during the early 1930s

was FDR, and he appoints the special prosecutor,

Thomas Dewey, and they go after Schultz.

And the rumor is that Schultz threatened

to kill Dewey and other high level political figures.

Concerned that a hit on prominent officials

will bring too much heat down on the mafia,

Schultz's own crime syndicate decides

to take him out instead,

sending members of the infamous Murder, Inc.

to gun him down.

He's in the hospital, but the word is,

he's not gonna make it.

I need you to deliver a message to him before he passes.

Take this down.

As ye sow,

so shall ye reap.

Sign it, Madam St. Clair,

Policy Queen.

The next morning, Schultz dies from his wounds,

but not before he gets St. Clair's note,

and she's once again, the queen of the numbers game.

Stephanie St. Clair,

her numbers game is the basis for the regulated state lottery.

There is so much money moving around and the state wants

to divert that revenue stream to the state treasury.

They talk about it openly, it's not a secret.

Though the process takes decades,

eventually, the numbers game gives way

to the state sponsored lottery.

Today from scratchers, to Mega Millions, to Powerball.

The average American spends $285 a year on the Lotto,

bringing in more than 105 billion dollars in revenue.

The numbers game was the lottery

before the lottery, it is the lottery.

The government says it's illegal,

and then they run it themselves.

Whether it's playing the numbers in the old days

or playing the official state lottery in more modern times,

that impulse has always been there.

The desire for wealth and respectability.

St. Clair eventually leaves the numbers

game behind, and after serving jail time

for shooting her husband,

a controversial community leader and activist,

she spends the rest of her life

as a philanthropist and advocate.

Stephanie St. Clair, she's a hero, she's a anti-hero.

She is a complicated woman, very self absorbed,

but someone who is about her community,

advocating for the rights of black New Yorkers.

Madam Stephanie St. Clair,

she'll go down in history as a female gangster

and a legend in that right?

And not only did she have a successful business,

although, be it illegal,

she ultimately took that and supported civil rights,

especially in the latter part of her career.

And she made a huge difference

for immigrants in the black community.

And I think she should be known just as much

for being a smart businesswoman.

Al Lyon launched a massive ad campaign,

touting the health benefits

of glycol in Philip Morris cigarettes.

And even though it's a dangerous additive,

they claim that medical research

has proved it makes them milder.

These the latest numbers?

Yes.

This is good, this is what I like to see.

So far, his gamble is paying off

and by the mid 1930s,

Philip Morris is netting the modern equivalent

of 31 and a half million dollars a year,

putting them just outside the four biggest tobacco companies

in the nation.

Behind the makers of Lucky Strikes,

Camels, and Chesterfields.

In the 1930s, the Philip Morris company,

it's nothing in comparison to the big four firms,

but it is certainly at the forefront

of deceptive advertising.

At the same time as Philip Morris is making these claims

on behalf of its glyco casing,

there are many cases, in the United States,

of people dying from diethylene glycol poisoning.

Famous doctors telling the health benefits of tobacco.

These were great sales techniques.

Thank you.

You're welcome.

The next year,

Philip Morris sells 7.5 billion cigarettes

and overtakes Lorillard,

the maker of Newports and Old Gold,

as the fourth biggest tobacco company in the US.

Then, war breaks out in Europe.

And soon the United States joins the fight.

Sending off millions of young American men

to the front during World War II

is an incredible paradigm shift for the nation.

And it's a huge opportunity for savvy tobacco companies.

As the US dedicates all her industrial might

to the war effort, Al Lyon sees a unique chance

to jumpstart Morris's growth all over again.

I don't mean to overstep, sir,

but it's just that Philip Morris cigarettes

aren't like other cigarettes, they're healthier.

The Second World War , there's another upsurge in smoking

along the same lines that you had in the First World War

for the same reason.

That's right, the number one doctor recommended brand.

We gotta keep our boys relaxed

as they're going into combat.

You won't regret it, sir.

They order 10,000 cartons.

Within weeks,

Philip Morris is contributing 290 billion cigarettes

to the war effort, nearly doubling the company's profits.

During World War II,

tobacco was treated as an essential strategic product.

And so tobacco farmers were not asked to join the military,

Their laborers was needed to ensure

that enough tobacco was grown in the country.

It was a strategic imperative

of the us war effort to ensure

that our soldiers had all the cigarettes that they wanted.

Philip Morris's cigarettes

are included in soldiers rations,

a practice that will last all the way until 1975.

Profits continue to soar and Al Lyon is promoted

to president of the company.

A lot of people say success came

from these giant leaps,

that people took this giant risk and they were successful.

If you really look at what happened,

it's a series of very, very small things

that got them to where they wanted to go.

That's really the truth.

He's got nowhere to go but up, for now.

With the war in Europe raging,

at home, more and more Americans are enlisting to serve.

Excuse me.

One young man is doing his part.

Excuse me, I'm reporting for duty.

My name is Hugh Hefner.

Someday, he'll leave behind a troubling legacy,

but also become a cultural icon

and divide the country between those who believe in freedom

of expression and freedom from smut.

over the course of World War II,

more than 16 million American soldiers will serve.

And when they're not fighting many look for distraction

in pleasures of the flesh.

Many of the millions of American men who serve in

this period are actually introduced

to some illicit consumer pleasures they're abroad.

Cigarettes, for example, are issued to soldiers on the front

and they'll come home with a taste for that tobacco.

Some of those soldiers will take up drinking.

There's funny expression,

"How you gonna keep 'em down on the farm

after they've seen New York City,"

and during World War II,

that expression very well could be,

"How you gonna keep them down anywhere in America

once they've been to Europe

and have experienced, unfettered,

every vice imaginable."

Far from the front lines, 17 year old,

Hugh Hefner is stationed at a field hospital

and training ground called Camp Pickett.

He famously came from a very repressed Methodist home.

They didn't discuss sex,

Not a lot of hugs were handed out in the house.

He wanted to get in touch with things that were

of sexual nature, of a romantic nature,

that wasn't discussed at home.

Even though he's far from the fighting,

he's found his own unique way

to contribute to the war effort.

He loved to draw, he made cartoon strips

from the time he could first put pen to paper

and he just updated into the Army.

They sort of channeled him off

into becoming a clerk in the personnel division.

We have a kind of romantic idea

of this brotherhood that was formed, you know,

on the front lines.

And that's true,

but there was also everything

that they did kind of off hours.

This was the era of pinup magazines

and talking about the latest Hollywood starlet

who they had on their wall.

At the time, pornography does exist,

explicit pictures and movies date all the way back

to the invention of the cameras

that capture them in the 1800s.

But even by the 1940s,

obscenity in the US is still governed

by the Comstock Act of 1873,

which makes all pornography illegal.

From nude images to books

that contain titillating sequences

like James Joyce's "Ulysses."

Comstock once claimed that he

had destroyed 160 railroad cars full of pornography.

He was obsessed with nudity not being left

and lorded it over our morals,

and our erotica pornography, everything.

He also, he would break up these,

what were effectively body building competitions,

where like Charles Atlas would pose because he thought that

that was obscene to have a man so scantily dressed.

Suggestive drawings of pinup girls

are considered acceptable

and Hefner relishes drawing them during his time

in the army and his college newspaper.

And after that, he wants to resurrect them

in his new job at "Esquire" magazine.

What's this.

Pinup girls, used to be the best part of "Esquire."

So I'm thinking-

No, I need 500 words by end of day, not doodles.

Are we clear?

Crystal.

Hefner believes he's destined

for something bigger, but he doesn't know what.

For now, he's stuck in a dead end job.

Now that World War II is over,

millions of veterans have returned home with a taste

for cigarettes.

And thanks to their inclusion in military rations,

Philip Morris's sales are nearing $300 million a year.

Sharon, can we get some coffees in here?

But after deftly navigating smoker's cough,

Al Lyon is now facing an even bigger threat.

How have we got from smoker's cough

all the way to cancer.

In 1950 alone,

there are five important epidemiological studies

linking cigarettes as the cause of lung cancer.

"Reader's Digest" magazine publishes an article called,

"Cancer by the Carton"

that reports on the results of these findings.

As a result of new clinical studies,

the us government institutes a new policy

that makes Philip Morris' strategy

illegal almost overnight.

In 1955, the Federal Trade Commission mandated

that the tobacco industry stop these explicit health claims.

They couldn't say that their cigarettes were healthier

than others, unless they had science to back that up.

Well, the cigarette manufacturers didn't

have any science like that.

And if we even mention the health benefits of glycol,

the government will come after us.

So our lawyers seem to think.

Then what we need is something that implies

how healthy they are without actually saying it.

I want a dozen new campaign options on my desk by tomorrow,

get moving.

Billy Wilkerson

has finally broken ground on his luxury resort and casino.

We need to get rid of all these windows

on the gambling floor.

I want every moment of the day to feel the same.

But if he's going

to revolutionize the gambling experience,

he knows he can't accept anything but perfection.

We're already way behind schedule,

this will set us back.

And these hallways from the hotel,

they need to connect to here, that way,

people have to walk past the tables to get in and out.

From his own gambling experience,

I think it was really easy for him to say,

"I'm gonna start something completely

from scratch that nobody's ever seen before,"

to make the gambling experience as comfortable as possible.

Plush chairs, padding around the tables.

If we do that, we'll be outta money in less than a month.

So he does secure a loan for $600,000 from a bank.

His good friend, Howard Hughes,

is willing to give him $200,000.

How much more money would you need?

Double.

Make the changes?

Well, the compulsive gambler thinks,

"I can do it at the table."

To help fund his opulent vision,

Billy Wilkerson finds a high stakes poker game determined

to double his money, but he's already off to a shaky start.

The thing about the gambler, we often chase our losses.

So even if we're getting beat,

we think that eventually we're gonna turn the corner.

I'm all in, 200 grand.

Okay.

Full house, fours over sevens.

Twos.

♪ Tell me what to do ♪

over twos.

♪ I see that life ♪

Dammit!

After less than a year of work,

construction on Billy Wilkerson's

game changing new casino

is on hold because he's running out of money.

The construction site just laid there in the desert,

like the skeleton of a beach whale.

And there was a point where my dad thought,

"I've gotta make a decision.

Whether I wanna keep on with this

or just walk away from it."

And he was seriously considered walking away from it.

So what brings you all the way from New York.

Firm I represent heard about your operation.

He and his architects are wondering how to keep going,

and then a man he never met before,

named Rothberg, shows up.

What's this?

It's an opportunity.

We'd like to invest.

What kind of investment gives you 51%?

A million dollars.

Rothberg shows up with an offer to Wilkerson.

There's enough money to finish his dream,

but he has to turn over the ownership of the project.

There's no way that I'm giving you a controlling stake.

It's a one time offer.

Take it or leave it.

He absolutely can't refuse, it's a million dollars.

Within a week,

Wilkerson's casino is back under construction.

But at Philip Morris,

Al Lyon's strategy is falling apart.

The government is cracking down on health claims made

by cigarette companies and new studies continue

to make things worse.

A team of researchers at Wash U finds

that they can induce cancer in mice

by painting tobacco tar on their backs.

This is not just circulated in the medical press,

but receives widespread public attention.

By the 1950s,

an anti-smoking crusader, named Roy Norr,

begins producing educational movies

and publishing a newsletter called,

"Norr's Newsletter About Smoking and Health,"

warning Americans about the hazards of cigarettes.

The problem that's been identified,

it's not nicotine it's tar.

Well, one of the solutions is put filters on the cigarettes.

It'll be lodged and then caught in the filters

and, therefore, we eliminate the tar.

Today, 90% of all cigarettes are filtered,

but at the beginning of the 1950s,

that number is less than 1%.

Al Lyon recognizes the opportunity

and purchases a struggling cigarette brand

first introduced back in 1931 and thought of as a gimmick

for their recessed filter tips, Parliament.

They don't receive a lot of attention from the cigarette

manufacturers or, crucially, a lot of advertising.

Philip Morris purchases the brand in order

to acquire know-how about how

to do filter technology, such as it was.

Now privately, behind the scenes,

the tobacco manufacturers well knew

that essentially nothing was being filtered out.

When a company sells an unhealthy product,

is it someone's freedom to buy whatever they want,

even if it's going to kill them?

Or should the American government protect consumers

from themselves?

I think the American public is still split on that.

As Lyon strategizes a counter attack

against health reports.

In 1953, an Indiana University zoologist, and founder of the

Institute for Research in Sex, Gender, and Reproduction,

named Alfred Kinsey,

publishes one of two books commonly referred to

as the "Kinsey Reports,"

it's called "Sexual Behavior in the Human Female."

And it transforms the way people think about sex.

He interviewed about 18,000 people

and he talked candidly about women who had orgasms.

And that was really groundbreaking in many ways,

that focus on female sexuality and to see it as something

that could be positive rather than negative.

That is a bombshell because it shows that there are lots

of people who have had sexual relations

with people of their same sex.

It shows that people have engaged in all kinds

of premarital sex, and that really shakes things up.

Hugh Hefner reads Kinsey's work.

And after losing his job at "Esquire" magazine,

he meets with a long time friend named Eldon Sellers,

to forge a new path toward the future.

So, uh, what now?

Hefner add a number of friends, and associates,

and professional connections

that he would draw upon to get help.

Why don't we start our own magazine?

One of them was Eldon sellers who

was really a family friend.

We?

Yeah, I'm the idea man, you're the money.

I'm listening.

We make a magazine like no one's ever seen.

Cutting edge fiction,

world class journalism,

interviews.

It'll have humor, sophistication.

And instead of pinup girls,

full nudes.

Nudes?

Yup.

Have you lost your mind?

Back in college,

Hefner pioneered a recurring feature

in the school paper called "Coed of the Month."

How is this better than your pin up sketches?

It's sexier, less clothing.

Because she's real.

There was not any nudity of course, involved in this,

but they would pick a, sort of, a pretty young girl

and they would feature her in the magazine.

Her interests, her activities, a picture or two of her.

So a little bit of a germ

of what would become something quite famous

in "Playboy" some years later.

Now he wants to take the idea one step further,

even though, at the time,

distributing nude imagery is still against the law.

I'd buy that magazine.

You'd buy that magazine.

I think Hefner was able to trust his instincts.

I think from a child,

he might have even had this vision for the magazine.

And I think that that nothing was gonna deter him

from doing what he set out in his mind to do.

From what I know about Hefner,

I'm like, very not sympathetic to him.

Like, "Oh, he was a real feminist," like, whatever.

I think that's like, kind of b.s.

I think it's really important not

to confuse the sexual openness that he espoused

and the particular way it played out with some kind

of wonderfully egalitarian, liberated,

sexually equal society because it didn't function that way.

Well, either we get rich, get arrested, or

both.

Does that mean you're in?

It means I'm thinking about it.

I can work with that.

After almost running out

of money on his luxury casino project,

Billy Wilkerson is back under construction.

Thanks to a million dollar infusion

of cash from a mystery investor from New York.

What the hell do you think you're doing in here?

I'm just here to check in on my casino.

It turns out his investor is a front

for the New York mafia.

Recently infamous gangster, Bugsy Siegel,

found out about the casino.

Millions of dollars in cash flowing in every single day.

This could be the most lucrative gambling operation

we've ever had.

And brought it to my boss, Frank Costello.

Interesting, what's our in?

The guy who's building, bankrupt,

whole project's about to shut down.

Thanks to Wilkerson's gambling buddy,

Johnny Roselli.

Card games, dice games,

we'll have everything you could think of.

Plus, hotel, pool,

restaurants, bars.

Okay, but be discreet.

Now Siegel's in Vegas

to make sure Wilkerson knows who's really in charge.

Appreciate all the work you've put in so far.

Love it if you stay on.

Bugsy is a very assertive fella.

And while it was supposed

to be Billy Wilkerson's vision all the way,

Bugsy gets on the construction site.

I mean, Bugsy Siegel wanted it all.

Right, so, partners then?

Sure, partners.

And he bragged often, you know,

I've killed 16 men, but don't worry.

Wilkerson's dream in the desert

now hinges on the whim of a professional murderer.

But in Virginia,

Al Lyons hopes rest on filtered cigarettes,

which are considered a gimmick marketed to women.

And he's looking

for the most masculine brand Philip Morris has,

hoping he can appeal to men.

As you can imagine, Chesterfield tested high.

Philip Morris wants to get in on the filtered game.

Its brands had actually been flagging in the 1940s

and it quite clearly sees that filtered cigarettes

are the market of the future.

And so to do so,

it reaches into its arsenal of already existing brands.

That was number one.

Actually it was number two.

The number one was Marlboro.

The women's cigarette?

Yes.

It was a different kind of Marlboro than is sold today.

In the 1920s, the advertising slogan was, "Mild as May."

And so it was a female brand.

This is either some kind of joke or some kind of mistake,

which is it?

It's neither, Marlboro tested

as the most masculine sounding brand.

You're telling me that the manly brand

is currently marketed to women, amazing.

If Al Lyon's going to sell Marlboros to men,

he has to completely reinvent its image,

starting with the look.

We have different types of filter wrappings.

Which costs the least to produce.

They're all the same, it's just down in the preference.

The idea was that by inserting a piece

of paper, or acetate, or cork inside of a cigarette,

you could, somehow, make it safer.

- I like this one. - Mm.

Tragically,

some of the material that was used as a filter

was actually more poisonous than tobacco itself.

The best example of this is the micronite filter produced

by Kent for a few years,

which actually use asbestos fibers as a filter.

In addition to the new filter,

Lyon wants to give Marlboros new packaging.

Cigarettes at the time are sold in soft packs

that are easy to fit in the pocket, but also easily crushed.

Is this what we have for packaging?

Well, we are working on a new prototype,

but it's not ready yet.

He wants something hardier,

that also makes a smoker look

at the branding every time he or she pulls out a cigarette.

Show it to me.

When we think of advertising,

we think of billboards and magazine ads,

but the cigarette pack

is the most important cigarette advertisement

because that's the thing that the person holds in their hand

when they take the cigarette out to smoke it.

It's made out of a thin cardboard to help protect the

cigarettes from when you shove it in your pocket.

And the lid flips open with one hand.

Cigarettes before the flip top box

were packaged in paper wrappings,

the 20 cigarettes would be wrapped in foil.

Then the foil be wrapped with a band of paper,

outside of the paper it would be wrapped in clear plastic.

Fast-track this.

I want this in production when we launch.

Evidently executives at Philip Morris thought

that a harder edge, flip-top box signaled something

more masculine than a soft pack,

but it also had the advantage, for consumers,

of making cigarettes less likely

to get crushed in your pocket or in your purse.

While Lyon plans to relaunch Marlboro,

Hugh Hefner is working on a new magazine

featuring fully nude photographs,

even though distributing them is against the law.

We're close, I know that.

How do you feel?

I still do think that we should move the party jokes

ahead of "Tales From the Decameron."

No, it's it's classier this way.

The funny thing about that first issue,

he threw a lot of everything in the kitchen sink.

He was smart enough to throw, you know,

articles and lifestyle features,

a touch of everything to show the reader that this

was going to be something a little different

and it was going to be something for everybody.

Hefner wants to give his

groundbreaking magazine an iconic name.

And after painstaking thought, he's finally got one.

Here it is.

This is the cover?

It's great, right?

What the hell's "Stag Party?"

Like, it's like a bachelor party.

The last piece of the puzzle is a featured cover model

who will make the entire nation stop and stare.

Wait, that's not, is that?

No, it can't be.

I think it is.

I think you're right.

There were photographers out there

that had material on different superstars of that time,

because typically,

they would start out doing modeling for the studios.

Hefner has just stumbled upon nude photos

of one of the most famous starlets in the country,

and one of the most iconic of all time,

from before she was famous.

Sure enough, the photographer that he went to,

he did have the images of Marilyn Monroe.

It was just luck, I think it was timing,

but Hef did not believe he

was gonna have enough money to buy those images.

To bring his vision

for a modern men's magazine to the world,

Hugh Hefner will have to cash in on photos that one

of the biggest stars in Hollywood

hoped would never be seen.

Hugh Hefner has found nude photos

of Marilyn Monroe

from before she got famous and he wants to use them

to launch his new "Stag Party" magazine.

Hugh Hefner decides that these

will be the photographs that will really mark his magazine

as a magazine that is distinct from everything out there.

A magazine that is willing to push the envelope.

He knows that this is explosive.

Marilyn Monroe

was born Norma Jean Mortenson in 1926

and, under her stage name,

she's headlined films like "Gentlemen Prefer Blondes,"

and, "How to Marry a Millionaire,"

making her one of the most bankable stars in Hollywood.

And Hefner needs the rights

to her nudes if he's going to publish them.

And this would be exclusive?

And how much for publishing rights?

500?

At the end of the day,

the photographer really had no idea

what he was holding on to.

I'll pay cash.

So Hef went in there and got all the images.

No, no, no, no, of course not through the mail.

We don't want any legal trouble.

Give me an address, I'll meet you there.

Sending nude images

through the mail is still illegal.

So Hefner plans to buy them in person, for better or worse.

He knows that he's actually cracking something wide open

and he decides to do it in a way that is very controversial

because she did not want these photos circulated.

In Virginia, Al Lyon is ready

to introduce Philip Morris's new Marlboro cigarette.

And for the first time since becoming company president,

he's considering an advertising agency to launch it.

May I see the product?

Of course.

Leo Burnett is a legend in his own time,

credited with creating such iconic marketing characters

as Toucan Sam, Tony the Tiger, and the Jolly Green Giant,

but he has no experience at the tobacco industry.

These stripes are a design disaster.

And this lowercase M, it just reeks of trying too hard.

Just make it a capital, it's a proper noun.

How much time would you need

to put together a campaign for us.

Couple weeks.

Done.

While Lyon bets on Burnett,

Billy Wilkerson is trying

to build an unprecedented luxury casino,

called the Flamingo,

but he's struggling to coexist with his new partner,

notorious murderer, Bugsy Siegel.

Everyone, out.

What's this.

Sign it, it says you're out.

Siegel's ego got in the way to the degree

where he wanted to be a one man band.

I'm not signing this.

Sign it.

And it's well documented

that he really wanted my dad dead.

You're smarter than you look, Billy.

When Siegel made the death threat,

everybody then knew it was real.

So he wanted to be as far away from this guy as possible.

Billy Wilkerson hands over full control

of the Flamingo, the first casino of its kind,

to the New York mafia

and escapes back to LA with his life,

leaving the dream of the Vegas strip

in the hands of Bugsy Siegel.

Bugsy Siegel is now in charge

of construction on the Flamingo luxury casino.

But the project was already over budget when he took over.

Sit down.

He's only made it worse.

And mob boss, Frank Costello, is losing patience.

We just have to finish construction.

Then the place will pay for itself in the first month,

it's gonna be spectacular.

Spectacular, huh?

I don't need it to be spectacular,

I need it to make me money.

Trust me, I got it under control.

Tame the bill.

Get outta here.

Under pressure from the mafia,

in December 1946,

Bugsy Siegel opens the Flamingo

before construction is even finished.

The opening, which was the day after Christmas, 1946,

which was horrific because

nobody in Hollywood is gonna come

because the movie industry traditionally

stays home between

Christmas and New Year's.

So, basically, it was an unmitigated catastrophe.

Gamblers who do come find

that the hotel portion of the Flamingo isn't complete

and there's nowhere to stay.

The casino is losing money, hand over fist.

And after just more than a month,

Siegel is forced to close until he can finish construction.

Al Lyon brought in legendary ad man, Leo Burnett

Gentelmen...

to help relaunch Marlboro cigarettes

and Burnett is finally ready to share his ideas.

Why would we remind people that cigarettes

could be unhealthy when we could remind them

how cigarettes make them feel?

How does that feel before they even light up?

What does a Marlboro smoker want to feel?

They wanna feel like a man.

Now, what kind of man does every boy dream to grow up to be?

We call him the Marlboro Man.

Sell them a lifestyle, gentlemen.

You have a customer for life.

It's brilliant.

In 1955,

the new filtered Marlboro cigarette is launched

with the Marlboro Man gracing billboards

and magazine pages across the nation.

Marlboro had been an insignificant brand

up until the 1950s,

but sales began to skyrocket after that time.

Within two years,

Marlboro sales jumped by 300%,

bringing in 20 billion dollars a year in profits.

Al Lyon, eventually retires.

And by the 1960s,

Marlboro is the most popular cigarette on the planet,

and cigarettes have become one of the highest selling

products in the history of planet earth.

The reason that Marlboro advertising

was so successful was because it sold smokers

on a fantasy of independence, virility.

Marlboro is one of the first brands

to really pitch itself, not as a product,

but as a way of life.

Today, more than 6 trillion cigarettes

are sold each year.

And as of 2018, lung cancer deaths still average,

nearly 150,000 annually.

The cigarette manufacturers have worked hard

to position smoking as a choice,

freedom to smoke, the right to smoke.

But in fact, smoking is the opposite.

Smoking is ensnarement, it's slavery.

Smoking is an addiction that robs the smoker

of his ability to choose to smoke.

Science is clear on that.

In Chicago, Hugh Hefner is finally ready

to introduce his groundbreaking new men's magazine

to the world.

This came for you.

Return address is from a "Stag" magazine.

Hefner was about ready to launch the magazine

under the title of "Stag Party."

What?

Cease and desist.

Let me see that.

And I think much to his good luck,

because I don't think that's a very good title,

"Stag" magazine apparently sent Hefner a letter threatening

to sue him because they thought "Stag Party"

was too close to infringing on their title rights.

This is insane.

Damn.

So at the last moment,

Hefner's forced to change the name of his magazine.

Hefner and Eldon Sellers immediately

begin brainstorming, hoping for last minute inspiration.

Smooth Operator.

Awful.

You're right.

Okay, um, "Top Hat," hmm?

It's classy, it's gentlemanly.

Yeah, you know,

my mother worked for car manufacturer

and they sold convertible sports cars,

but they went bankrupt

before they ever brought them to market.

And?

They had a pretty good name,

Playboy.

Playboy?

Playboy.

After being muscled out of the Flamingo,

the first luxury resort and casino of its kind,

Billy Wilkerson has returned to Los Angeles

and his job running "The Hollywood Reporter."

Then on June 20th, 1947.

My father opened the newspaper

and there was the headlines that Siegel had been slain.

I think he was just glad that it was over

and with Siegel's death,

he could completely walk away and put a period

at the end of this terrible episode in his life.

Bugsy Siegel dies

of two steel jacketed gunshots

to the torso, and two to the head.

There was an immediate guessing game,

who could have killed Bugsy?

Was it the New York mob?

Had they got tired of losing money?

And were they after Siegel for that?

Well, we still don't know for sure.

It is still an open case.

Once all construction is complete,

the Flamingo reopens as the Fabulous Flamingo Resort

and within a year, it's bringing $4 million in profit.

The modern equivalent of nearly 52 million.

Billy Wilkerson doesn't share in the success

and his contributions are often overlooked,

but thanks to his revolutionary vision,

he's the forgotten godfather of the modern Las Vegas strip.

The founding father for the Vegas strip is my dad.

You can't point to anybody else.

I would like him to be remembered as it,

and I think he deserves that credit.

One can still see the impact of his ideas on Las Vegas.

An endless round of resort complexes.

the Sands hotel, which opened in 1952.

You can see that with the Desert Inn

which opened it in 1950.

With the Sahara, also in 1952.

With the Riviera that opened in 1955.

With the Tropicana that opened in 1957.

Wilkerson spends the rest

of his life successfully running "The Hollywood Reporter,"

but his impact on America's city of sin is undeniable.

In Chicago, even though he knows he's asking

for legal trouble, Hugh Hefner is finally ready

to launch the first edition

of his new men's magazine, "Playboy."

Sign here?

Thank you.

Any magazine collector or historian

of "Playboy" knows it didn't bear a date on the cover.

And the reason it didn't bear a date is

because Hugh Hefner did not know if there

was going to be a second issue.

The first issue of "Playboy"

sells all 70,000 copies within weeks

and earns Hefner $30,000 nearly overnight.

When that first issue of "Playboy" came out,

America was a different place than the place we see now.

These were the first hormonal surges

of the sexual revolution.

He took that more or less sterile,

sort of, suburban America and made it cosmopolitan.

Out of that grew all sorts of liberties and freedoms.

Almost immediately,

Hefner faces legal challenges

for distributing lewd content.

Very early in the publication of "Playboy,"

Hefner, as he somewhat expected,

ran into problems of censorship.

There were laws in Chicago, in various states,

and even the federal post office got involved in this.

In 1955,

the Postmaster General refuses

to deliver "Playboy" magazine,

claiming the contents are obscene.

Hefner sues the government in response

and wins.

By the end of the 1950s,

Playboy is selling millions of copies every month.

As much as I'm no Hugh Hefner fan,

he certainly contributes to breaking down those walls around

that kind of sexual silence,

which I think was so limiting for so many people.

Hefner continues to fight obscenity laws

for much of his life, but his legacy is complicated at best.

Hugh Hefner is a controversial figure, without question.

There was a time when

some feminists actually celebrated Hugh Hefner

and they talked about how he kind of allowed men,

and women alike,

to shed some of these Victorian ideas

about sexual repression, and to allow men and women

to enjoy sex, and to be open, and to be sexual.

Fairly quickly, I think another wave of feminist began

to show how Hugh Hefner used the language

of sexual freedom almost in order to coerce women

to participate and be sexually available to men.

And I think that is becoming a more dominant interpretation

of his legacy today.

Today, though it's hard

to accurately track since

so many companies are privately held,

It's estimated that the adult industry

is worth nearly 15 billion dollars a year.

That's more than total domestic box office receipts,

Major League Baseball, or the NBA.

And the contraceptive industry is worth another 5.8 billion.

American culture is defined by

at least one fundamental tension,

and that is the freedom to make decisions about

living your life and treating your body, how you want.

And also a kind of deep Protestant ethic

about not indulging, especially around sex.

Is it American to say my body, my business,

I can do whatever I want,

and what my money can buy is A-okay?

Or, is it American to say I resist all of this to be pure?

And that's been with us for a really long time.

As people's sexual mores change,

there were always those people

who were kind of pushing up the boundaries against this

to deny is a normal human behavior.

Thanks in part to Sin City,

legalized gambling has spread across the country and online.

Today, the gambling industry is worth

more than 53 billion dollars in the United States alone.

Gambling, listen, there's no secret.

The odds are with the house.

You ever go to Las Vegas?

You know, you see they have 5,000 room hotels

that they've built, right?

It's absolutely incredible what's happened

in Las Vegas over the last 50 years.

Well, it used to be you had to find a bookie,

now in the Palm of your hand,

you can make a bet with a iPhone.

You can do it on the subway,

you can do it from your home, you can do it at the beach.

You can make a bet anytime, anywhere, 24/7.

And I think given the opportunity to practice vices,

we're gonna practice vices.

Despite the inherent dangers,

the global tobacco market is still worth $760 billion today.

And thanks to pioneers like Adolphus Busch,

Jack Daniel, and Nearest Green,

in the United States alone, the alcohol industry

is worth over $222 billion.

Whether it's 1890 or 2022,

it's incredibly difficult to grow a business

into a national, let alone global, entity.

Most businesses start small and remain relatively small.

Jack Daniels, you know,

they were just making whiskey down in the south

and they were able to market themselves

and slowly grow, and grow, and grow,

and now it's a brand that's known all over the world.

It's impossible to envision America

without Anheuser-Busch.

I mean, Budweiser, I mean,

that's the beer of America forever, and ever, and ever.

So when you say Anheuser-Busch,

I can see the Budweiser can in my head.

I can see the eagle spinning around like this.

Anheuser-Busch put themselves out

there as the beer version of Superman.

You know, we are a truth, justice,

and the American way, and check out these horses.

For more than a hundred years,

those who believe in the freedom to indulge

have battled those who seek freedom from temptation.

When all these industries began there were no regulations.

It was the wild, wild west.

And I think over time, we've educated ourselves.

We realized the good and the bad.

And, you know, we've kind of turned

to a society where we're in the middle.

The truth is, the fight may never end.

I don't think vices are inherently good or bad

and they move so fluidly throughout history.

I mean, just one example,

it was illegal to go to a baseball game, in New York City,

up until 1919.

It was illegal to play golf in New York state until 1950.

Marijuana was this horrible drug

from the 1930s till about a week ago

and now 20 states have legalized it.

I mean, perceptions change.