The NYC Italian Mafia
The promise and perils of "quick and quiet coordination"
This is part eleven in a series about societies—rather than businesses or governments—that have made a meaningful impact on the world. See all installments listed at the bottom of this essay, and see The Society Builders most recent intermission piece here.
When I was a kid, I was obsessed with the Italian mafia. I couldn’t get enough about them. So like any mafia-obsessed kid, I loved the Godfather trilogy of films.
If you’ve seen the first Godfather film you know it begins (or, nearly-begins) with a memorable scene. Bonasera, a local undertaker, comes to Don Corleone (a powerful mafia leader played by Marlon Brando) seeking justice for his daughter who was beaten by her boyfriend. After some initial reluctance, Bonasera eventually asks the Don to be his friend and calls him "Godfather.”
Bonasera’s respect shown and request for friendship (despite his previous aversion to association with the known mafia leader) tips the scales for Don Corleone to affirmatively reply he’d help solve his problem. But Don Corleone’s specific reply was this: "Some day, and that day may never come, I'll call upon you to do a service for me. But, until that day -- accept this justice as a gift on my daughter's wedding day."
This illustrates a bit about the nature of relationships with outsiders vis-à-vis the crime family. Outsiders have a particular way of relating to the organization, through signs of friendship and respect and through negotiated reciprocity. But it’s the inner workings of the Italian mafia I came to find most interesting—how they relate among one another, how they coordinate their (nefarious) activities.
Eventually this Italian mafia fixation of mine turned into a generalized “mafia” fixation (as you can no doubt tell by the fact I’ve written an entire series so far on networks tantamount to mafias, albeit with more benevolent aims). So when I first heard the media referring to the Paypal Mafia way-back-when, I basically already knew what they meant: it was describing a tight-knit, mutually-aligned, easy-to-coordinate yet still-independent collective of individuals, who’s maneuverings aren’t public but who’s effects are material (and sum up to become powerful).
So here I want to summarize a handful of interesting observations about “mafias” (colloquially understood) writ large, as told through the lens of the Italian mafia families. It goes without saying that obviously—obviously—it matters what your “mafia’s” efforts are aimed at. Bribery, extortion, blackmail, gambling rackets, drug rings, etc.—these are probably not your highest calling! But the mechanics of “mafia” are interesting nonetheless, and worth exploring as part of The Society Builders series given so many networks essentially operate as “mafias” for whatever their intended mission is.
The best shorthand for “mafia” might be “quick and quiet coordination ability.” If you can make something happen quickly, quietly, via relationships, that’s the dynamic of “mafia” most compelling to outside observers.
Within mafias, guaranteed coordination (for reasonable requests) is typically assumed. You’re already on the same team—so, being helpful, in the micro gift economy that is your “mafia,” is also assumed, especially if structured appropriately where each party stands to benefit.
Reciprocity is also assumed—for instance, if I’ve helped you in the past, I can go beyond the “guaranteed coordination” assumption to expect you to be helpful to me. This enables planning that involves other people, not just yourself or your immediate team.
The nature of these relationships is often quite intimate, given one of the most potent types of relationships (and even friendships) involve mutual ambition. I wrote a piece on friendship awhile back that I think describes this dynamic neatly:
“It’s hard to overstate how much common purpose or ambition can supercharge friendships. When you become co-conspirators in a greater quest to better your station in life, broaden your horizons, improve some aspect of life, or whatever – it’s a powerful motivator, can smooth differences in personality, and just generally can create a cool dynamic where you’re helping each other along your paths. The varieties of similarity here are manifold but the question is whether someone else is on the same path as you, and you can walk it together and experience the result as greater than the sum of its parts.”
Lastly and most interestingly, secretive “mafias” often superimpose onto more legible/visible organizations from behind-the-scenes. The Netflix documentary Fear City has some interesting examples, as summarized by Perplexity:
Control of Construction and Concrete In NYC
The "Concrete Club" Cartel: The Five Families established a monopoly over NYC's concrete supply through an alliance of contractors. Any project exceeding $2 million required paying 2% of the contract value to the mob.
Extortion via Delays: The mob exploited time-sensitive construction schedules. Delays in concrete deliveries could paralyze projects, forcing developers to pay for "labor peace".
High-Profile Projects: Mafia-linked firms supplied concrete for Trump Tower and Trump Plaza, with Gambino boss Paul Castellano and Genovese leader Anthony "Fat Tony" Salerno directly profiting.
Union Pension Funds as Investment Capital
Central States Pension Fund: The Teamsters' $1.5–$2 billion fund became a "lending agency for the Mob." Loans were approved based on mob connections rather than merit, with minimal repayment enforcement.
Rigged Investments: Mob associates like Allen Dorfman (a convicted Teamster consultant) directed pension money into fraudulent ventures. For example:
Kickbacks were paid to union officials to steer pension assets into corrupt hedge funds.
The Lucchese crime family used DMN Capital, a mob-controlled bank, to orchestrate pension fund fraud.
Political Corruption: Teamster leaders (including presidents with mafia ties) influenced government officials to approve substandard projects, enabling theft of materials and tax evasion.
Short version? Legitimate public-facing organizations like the Teamsters Union were coopted by the behind-the-scenes Italian mafias for an infinite money glitch by way of the Teamsters pension fund. Also, legitimate public-facing construction contractors were animated by the behind-the-scenes Italian mafias for their “2% on contracts above $2m” racket.
This superimposition of secretive networks onto legitimate institutions is something we’ve looked at elsewhere in our “cautionary tales” half of The Society Builders (see e.g., The Fellowship – which, as an aside, the video seems to be scrubbed from the Internet, but there used to be a video available of The Fellowship’s longtime leader speaking admirably about the Italian mafia as a positive example of the power of secrecy in effecting one’s aims – it’s referenced in this article, but I can’t seem to find it anymore). But it’s interesting to note the shape these superimpositions take, how they work, and especially how they benefit the secretive organizations at the expense of the public-facing organizations.
If you’re a bit confused at this point, I wouldn’t blame you. At the beginning of this piece I probably seemed neutral, even favorable, about “mafias.” Yet what I’m describing seems pretty objectively bad. Am I advocating crime?
You’ll note from our intermission that this essay is firmly within the “cautionary tales” section of The Society Builders series. Networks need not be powerful international criminal organizations to be effective “mafias.” Ultimately “mafia” is a metaphor, describing quick and quiet coordination ability. For insiders of the various startup world mafias—Paypal, or Stripe, or YC, or Palantir—what matters is the ability to shape the world through closely-knit relationships rather than from-scratch cold outreach and introductions. This “mafia” metaphor simply describes a quick and quiet coordination dynamic, not any endorsement of traditional criminal activity.
What makes this essay cautionary is that there’s something weird about secretiveness that creates the conditions for less-than-savory behavior. I’m not sure I’d go so far as to say secretiveness encourages slippery behavior, but rather that slippery behavior is often permitted among these “mafias” and thus that permission occasionally is leveraged by insiders to accomplish their aims.
So if you find yourself within some tight-knit network where quick and quiet coordination is available to you for reasonable and reciprocated requests, that’s great, ideal, and actually a lot of fun too. But the caution would be to take a page from the superhero comics and “use your power for good”—since these networks can be unusually high-leverage and thus can magnify your activities, for good or for ill. The best examples of exemplar networks we’ve looked at within The Society Builders often also have “mafia” dynamics—but it matters how you operate, and it matters what your aspirations are. Abolishing international slavery as a “mafia” is obviously quite different than dominating the NYC construction industry by fear and coercion. So, create good mafias: the world could use it, and the “mafia” form is flexible enough to facilitate groundbreaking humanitarian achievements the same as depressing criminal ones.
The Society Builders: Table of Contents
The Society Builders: Case studies on the hidden power of moral innovators
Alcoholics Anonymous: How AA invisibly built the most influential decentralized society in world history
The Clapham Circle: How 12 families in a London suburb abolished slavery
The Mondragon Corporation: A historical blueprint for cooperative capitalism (with a crypto lens)
MSCHF (aka Mischief, aka Miscellaneous Mischief): How to create a venture-backed art society that creates subversive culture
The Network School: Dispatch from the Malaysian ghost-city startup society (that bootstraps startup societies)
IBM: What their 1937 Song Book says about a bygone era of Corporations-as-Societies
The Society Builders: An Intermission—A quick essay for reflection, synthesis
The Fellowship: A cautionary tale of the secretive Washington DC "politico-religious" society
Rajneeshpuram: 4 lessons from the commune the U.S. destroyed