Saturday, November 26, 2016

Betsy DeVos: The Amway Secretary of Education

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 public 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, who 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 lat 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 in an article five years ago, the dangers of the for-profit education model are already 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 actually “diploma mills” (one website warns students to steer clear of 300 fake online colleges) offering courses of little merit.[1] 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 kudzu. 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 steadily through the ranks, and helped spread the brand to fifty countries. In 1993 he was chosen president of the company. 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, Besty 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!

Second, workers in Texas demand high pay and companies move to low-wage countries like China. 

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 assured us. But 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 the dollars?

Amway has been forced repeatedly 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. In legal actions filed by the State of Wisconsin in 1982, a report by Dr. Jon M. Taylor, an economist, found: “MLM 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.[2]

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. But 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.

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 stay 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!

Then China!

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 by 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, the security firm which operated as a paramilitary force during some of the deadliest days in the wake of 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 exciting 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.

Amway, baby!

Billionaires will save the children!
P. S. Remember Trump University!!


John J. Viall is also the author of the critically acclaimed:


Front cover.

Available on Amazon.com

Back cover.




[1] 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.
[2] In a court settlement in July, Herbalife agreed to restructure its marketing and pay a fine of $200 million.

14 comments:

  1. A friend of mine left this comment on my Facebook page. Maggie said:

    I was an Amway Distributor for 1 month back in 1979. We were told to "do our hundred" = spend $100 each month on Amway products. If you get 10 of your friends, and they get 10 of theirs, etc. etc. you will earn $2000 every month by only buying $100. I even went to the Rally in Kansas City and got to see a slide show of mansions and yachts, and heard Zig Ziglar assure us "see you at the top." Everyone but me was standing on their chairs sceaming. I hated the idea of looking at every friend & stranger as fresh opportunity for my "bidness" as my recruiter put it. Here was the catch back then -- if I wanted to buy a bar of soap, my recuriter had to buy a whole case. He ended up with a garage full of Amway products that he ended up selling door to door, at a huge loss, after the rest of us dropped out.

    But here's the thing that opened my eyes -- they convinced me (for a month) that what I was doing was NOT scamming my friends. I was told to first find out "what would you do if you had an extra $2000 a month? What are your dreams?" Then "sell them on their dreams, you are going to help them make their dreams come true." What drives this is the conviction that you are giving someone the opportunity to make a whole pile of money -- together -- and you convince them by dangling in front of them the financial freedom everyone dreams of -- quitting your job, etc. This reminded me of religious groups that go out and sincerely believe they are saving people's eternal souls. When you think you are doing good, you aren't going to listen to someone telling you that you are doing the opposite, not even when there's actual proof. It's your INTENT to do good, so that's all that matters.

    And this is what motivates the education reformers. According to our best ally in the Ohio BOE, A.J. Wagner, those whose ideas we oppose because we see with our own eyes how their ideas are NOT in our students' best interests at all -- those folks believe they have the key to helping all those poor, uneducated students - not the lazy teachers or the failing public schools. They sincerely, honestly, with all their hearts and minds think that they are RIGHT, and there's nothing we can do to convince them otherwise. They have some mighty good spin doctors on their side. Everything about education reform is sold to the public using terminology that is the exact opposite of what it really does, and they believe it. They think they are doing good, and the ultra wealthy live lives that are completely insulated from the rest of us, so they never will see exactly the harm that their policies are causing. (check You tube for a documentary called The Billionaire Boys Club if you want more info on how this works.) They have the power and the wealth to keep the power, and you betcha they're going to hang onto it.

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  2. Also from Facebook, Kathy Fleischmann Stemmer says:

    If you want to change education vouchers and charters have the data to prove they DON'T work. Devos is unqualified just as most of his picks have been. First poverty must be addressed. All children should have access to preschool. The poorest schools have the least resources. To increase literacy you need more trained people in K/1/2 to work in small groups. And Stop acting like teachers make too much money. After 37 years a BS, a Masters, plus 30 hours more I made significantly less than peers with same amount of education.

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  3. Gary Ruther also replied via Facebook: Why is it so hard to appoint an educator to that office? We really don't need another reformer. We need time to do what we are doing so we can do it well.

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  4. Gary followed up:

    I've been teaching for 20 years. 5 years ago just when our school started mastering what we were supposed to be doing, the state reformers changed up everything because they wanted to improve SAT scores. The new program was ditched in 2014, after 4 years. That wasn't even Common Core. It was a Texas brand.

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  5. Gary then responded to Kathy's comment:

    I don't understand why people think that we make a lot of money? They must not understand the contract that we sign. I don't get any paid vacations. I am paid to do a job for 189 days. Period. I choose to have that money distributed over 12 months. Otherwise, I could receive it all in 10 but I don't trust myself.

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  6. Tracey Bridge Baker also responded on my Facebook posting of this story:

    I would like to see a spread sheet on what he [Trump} promised his followers vs what he backs out on or does the opposite of. Drain the swamp and turn it into a cesspool.

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  7. Amy Sherman Truesdell (on Facebook) said:

    I am watching discussions on some friends' pages and am dismayed once again at the vitriol aimed at supposed failing schools and wicked, greedy unions. All I can do is shake my head and go back to reading my Hamilton biography. I shared the link to write your senators for those who are likeminded, not to stir a fight but to provide an outlet for voicing their concerns. I am told, perhaps she will bring something new to the table. Slow, head banging. Thank you for your writing which inspires continued effort at education and for education.

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  8. Bruce Maegly, an award-winning educator, now retired, replied via Facebook:

    I always thought the best qualified people to design cars were the mechanics who worked on them daily. Is it not logical to rely on classroom teachers to come together and fix the American education system? I can't imagine in the least that Mr Trumps selection is the answer to this dilemma!

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  9. Sue Ellen Ikens responded on "Dump Devos," a new Facebook page:

    Take a good look at your public schools. Note their facilities, academics, athletics, extra-curricular activities and clubs. Note their libraries, cafeterias, school buses and tennis courts. Enjoy their football games on Fridays and their theater events throughout the year.

    Do this now. Our Public Schools will not survive the DeVos Era of so-called school choice. Read about her if you have time. Understand that balkanizing schools into tiny compartments that have few facilities and fewer services does lower costs. Then think about why...

    After the fixed and legacy costs of the large public school infrastructure bankrupts traditional schools (as it has done over and over again in Michigan under the DeVos Blueprint) the small, compartmentalized schools will pool together in the name of economies of scale and become the worst of both worlds (public and charter.)

    Folks who cannot afford to home school or privately school their kids will be forced to send them to factory schools that will be as large as possible with as few as possible services and activities for their charges.

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  10. Bruce Maegly responded again--hitting the old nail on the proverbial noggin':

    The classroom teacher and their students have been Guinea pigs to every imaginable innovation in the heads of armchair education "experts" for decades. The classroom teacher is, without question, the only expert here - they have repaired countless mandated blunders for the sake of their students and the educational process. How much more of this can be endured?

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  11. My favorite response (and I can't locate it now, because I post on a dozen teacher-friendly Facebook walls) was this:

    "Who would have thought Trump was going to drain the swamp and turn it into a cesspool."

    Can't top that line. Not if I try for a month.

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  12. Arline Helms, who thought I was mean to Mrs. DeVos correctly pointed out one error. I had her husband's name as "Doug." It has been fixed. He's "Dick."

    I still think it's clear: Amway is a scam.

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  13. wow...good discussion by one guy

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  14. wow...good discussion by one guy

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