I’M A LIFELONG LIBERAL and a classroom teacher. But I’m beginning to agree when conservatives insist it’s time to do blow up, metaphorically, the U.S. Department of Education. At least then real educators wouldn’t have to take orders from clueless out-of-touch, arrogant school reformers.
Beginning in January the battle to improve the nation’s schools will be led by Betsy DeVos, wife of a billionaire, a woman who attended private schools when young, who kept tradition alive by sending her children to private schools, who never taught a day in her life, who never spent an hour as a school administrator, and never served a season on a local school board, either. DeVos made a name by touting school vouchers and—more importantly—raising stacks of cash for politicians.
In 2014, for example, DeVos and her husband Dick donated $1.45 million to Michigan lawmakers to defeat a bill that would have increased scrutiny of publicly-funded, for-profit charter schools.
Stephen Henderson, writing for the Detroit Free Press last June, minced no words in his response. This was nothing less than an effort by a fabulously rich, politically connected family to buy the votes of legislators, regardless of damage that might be done to children. “We really ought to round up the lawmakers who took money to protect and perpetuate the failing charter-school experiment in Detroit,” he fumed, “sew them into burlap sacks with rabid animals, and toss them into the Straits of Mackinac.”
Sarcastic, yes—but an idea not devoid of merit.
As Forbes magazine made clear five years ago, the dangers of the for-profit education model are plain to see. The shady dealings of big for-profit colleges like the University of Phoenix fill the headlines and clog the internet. Many for-profits are “diploma mills” (one website warns students to steer clear of 300 fake online colleges) offering courses of little merit. Their only goal is keeping students on the books till their last dime and dollar are exhausted. For-profits tricked students into signing high-interest loans, inflated claims of job placement success and preyed on veterans.
And yet, Forbes explained, at the K-12 level: “Four out of five charter schools in Michigan are run by for-profit corporations. Let that sink in a minute. This should be deeply, deeply troubling for anyone thinking about their child’s future education, or the future of this country.”
The question then is why? Why would Mr. and Mrs. DeVos spend a million plus to defeat a bill favored—until the cash explosion—even by most Republican lawmakers?
Faith in unfettered free enterprise, I suppose. Get ready for the Amway model, writ large in education!
(We’re all going to be rich!)
For those who know nothing about Mrs. DeVos, a dose of helpful background. Richard DeVos, her father-in-law, helped found Amway in 1959, a direct sales operation originally specializing in home cleaning products. The company thrived and spread like herpes. By 2014 Forbes could list Richard as the 83rd richest individual in the world, worth $6 billion. His son, Betsy’s husband, went to work for Amway in 1974, rose through the ranks, and helped spread the brand to fifty countries. In 1993 he was chosen president. Seven years later he led a corporate restructuring that created a new parent company, Alticor.
Now: To be fair, the family has done some excellent charitable work, often going through Christian groups to help the homeless, even providing grants to aid the Grand Rapids Public Schools in cutting student absenteeism.
Unfortunately, the family has also spent lavishly to buy up politicians.
As an added bonus, in 2004, Betsy DeVos insisted that her home state of Michigan was losing jobs because wages were too high. This kind of conservative thinking can be boiled down to two steps, equally harmful to ordinary Americans.
First, workers in Michigan demand high pay and companies move to low-wage states like Texas. Boo, says Betsy! Bad workers!
Second, workers in Texas demand high pay and companies move to low-wage countries like China.
Oops, says Betsy!
Oops, says Betsy!
Even worse, if you keep searching, are the countless stories that cast a pall over the entire Amway model. In my case, years ago, my wife and I were approached by friends who urged us to join them in the “Amway family.” We would get rich together they claimed. Listening to their pitch, it sounded like a pyramid scheme. My wife and I would set ourselves up as independent business owners (IBO’s). We would make money selling products directly. And we would make even more, heaping piles of dough, by enlisting family, friends and others to sell more Amway products, earning a percentage of their sales and a percentage of the sales of those they recruited, and so on to infinity. This is called a multi-level-marketing approach (MLM).
Well, what has happened since that fateful day when my wife and passed on a chance to start stacking up dollars?
AMWAY HAS REPEATEDLY been forced to beat back legal challenges. On narrow grounds the company has stayed alive, and prospered, often with the timely aid of powerful politicians who have been granted fat campaign contributions. But in fundamental ways Amway has been losing all along. IMLM as a business model—with its endless chain of recruitment of participants as primary customers—is flawed, unfair, and deceptive.” Taylor summarized: “less than 1% of MLM participants profit. MLM makes even gambling look like a safe bet in comparison.”
Yet, every year, tens of thousands of fresh recruits fell for the Amway pitch—kept dreaming—kept losing.
All the while, Betsy DeVos continued to raise money for the politicians. Even President George W. Bush noticed. In 2001 he appointed a former Amway lawyer, Timothy Muris, to head the Federal Trade Commission. Eight years later Muris, having returned to private practice, helped convince the FTC not to impose strict disclosure rules on MLM marketers—like Herbalife—and Amway.
Three years passed. NBC aired an undercover expose (by 2004 Amway was operating under the name of Quixtar). A recruiter told an NBC producer, posing as someone interested in becoming an IBO: “If you’re somewhat serious, all I mean by somewhat serious —if you invest maybe, say, 10 to 15 hours a week in your business. This is your own business—you could generate in the next 12 to 18 months, an extra quarter of a million.”
The prospective “IBO” expressed surprise.
True, the recruiter admitted, there were motivational books to buy in order to learn to banish “negativity” and sell, sell, sell—oh, $60 monthly. And there were seminars to attend—um, maybe $50 monthly. And no new IBO would dare miss the “Spring Leadership Weekend” down in Florida. That would mean several hundred dollars more invested. Eventually, reporters found themselves surrounded by an enthusiastic crowd of 15,000 attendees at the gathering, each and every one ready to spend 10 or 15 hours weekly in pursuit of his or her extra quarter million dollars.
How many made that kind of money?
NBC found plenty who didn’t. One said he worked day and night to make a success of the Quixtar/Amway model. In his best year he earned $34,000. Even that didn’t last. He ended up “destitute.” Reporters heard the same tale “again and again.” Vicky and Lindy Mack didn’t make an extra quarter million. They lost $35,000. Bo Short did make serious money, recruiting friends and family to join the company, coaxing them to recruit others, selling tapes and motivational books and conference packages. He quit eventually when “he began to realize he was part of a mass deception.”
How much did the average Quixtar distributor make? It was right there in the fine print.
Approximately $1,400 annually.
Approximately $1,400 annually.
So the years rolled by, and new recruits signed up and mostly ended up disappointed. The company changed its name. There was growth around the world. In 2007 Britain shut down Amway, calling it an illegal pyramid scheme, after a judge found 99.7% of 33,000 IBO’s in that country lost money. The company agreed to drastic changes and barely managed to remain legal in Britain.
In 2010, in response to fresh court challenges, Amway admitted 54% of IBO’s who had ever signed up were currently inactive. Gross income for the rest averaged a paltry $202 monthly. One expert estimated that the average IBO lost $1,176 annually. In light of such statistics the company settled a class action lawsuit, returned $55 million to former distributors and made changes in practices that cost another $100 million.
At the top of the Amway food chain, however, the DeVos family continued to pile up the billions. In 2012 this allowed Mr. DeVos to donate heavily to and lead a successful push to make Michigan a right-to-work state. “Freedom-to-work is pro-workers and pro-Michigan,” he proclaimed. Union leaders were thugs with “an almost pathological obsession with power.”
Besides, wages were too high anyway.
On to Texas!
In fact, if you kept digging you turned up shady operators on both sides of Betsy DeVos’ holiday table. Her father, Edgar Prince, co-founded the Family Research Council, an organization opposed to gay rights. That organization, which supports gay-conversion therapy, suffered a serious black eye in 2011 when George Alan Rekers, another co-founder, was shown to have traveled to Europe with a male escort contacted through a website, Rentboy.com. Rekers was a story himself, with a Ph. D. in psychology, and a creepy interest in spanking children to get the gay out.
Betsy’s brother, Erik Prince, founded Blackwater, a security firm which operated as a para-military force during some of the deadliest days after 9/11. Four Blackwater guards were eventually convicted in the murder of seventeen Iraqi civilians. The company has also been accused of defrauding the U.S. government, creating false billings, even passing off the cost of keeping a prostitute on the payroll in Afghanistan.
So, you might be wondering, what’s the final moral of the story?
We all know Mr. Trump has promised to “drain the swamp” in Washington. What few of his supporters could have dreamed was how many crocodiles he planned to hire to do the job of draining.
According to Open Secrets, Amway has made $21.3 million in political donations since 1990, and since 1998, spent just short of $5 million more on lobbying. The DeVos family in all its permutations has donated tens of millions more to right-wing causes.
And so you see.
These are exactly the kind of leaders we need to stand up in the name of millions and millions of America’s children.
|Billionaires will save the children!|
P. S. Remember Trump University!!
John J. Viall is also the author of the critically acclaimed:
 Corinthian College, to cite one of the worst examples, was ordered by the federal courts to pay off $530 million in student loans fraudulently arranged. The fly in the legal ointment is clear. Corinthian has since gone bankrupt. Taxpayers are likely to foot the bill for Corinthian College’s business sins.