Kamil Ahsan,  January 16

All in the FAM

The pyramid scheme and the American way of life

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In the early 1990s, somewhere “Orlando-adjacent,” Travis Stubbs—an exhausted, lowly “distributor” for a shady company called Founders American Merchandise (FAM)—falls asleep at the wheel, careens off the road, and gets eaten by an alligator. It could happen, but in this case it didn’t. Travis is a character in the Showtime black comedy On Becoming a God in Central Florida starring Kirsten Dunst as Travis’s wife, Krystal. The gory scene where Travis gets chomped on by an alligator appears toward the end of the pilot, a pretty good omen of the surreal and deeply weird things to come.

Travis’s death jumpstarts the real story: that of Krystal as a skeptical, scheming, working-class widow out not for revenge on FAM so much as survival. The show introduces the dizzying array of jargon peculiar to the world of multilevel marketing (MLM)—a branch of the direct-selling industry that often operates a lot like pyramid schemes. The man who recruited Travis to FAM is his “upline,” Travis in turn recruits more distributors who constitute his “downline.” Travis is a true believer in FAM’s mantra that by becoming his own boss, quitting his regular J-O-B (Just-Over-Broke or Jerks-On-Board or presumably many other things), working hard, and “trusting the system,” he can become fantastically rich—by buying FAM products from his upline and selling to his downline. Meanwhile Krystal, the unsupportive wife who sees through the scam, is a “stinker-thinker.”

In other words, the world of FAM is arcane and, on paper, would seem to make for profoundly unsexy television. Good thing then that the show is at equal turns uncomfortable and fun, replete with cheeky and dark visual metaphors for the nature of the 1990s-era world of pyramid schemes. Pelicans fall from the sky at a bargain-basement imitation of Disney World. Krystal contracts bird flu and the scene turns psychedelic as she drives from one ghost neighborhood to another, trying to recruit distributors in places where it seems everyone has been evicted. Everything is at maximum fever pitch, which makes sense: weird is a form of verisimilitude when it comes to MLMs—as anyone familiar with the famous anti-MLM Reddit group, or with Last Week Tonight with John Oliver, or with the podcast The Dream knows well.

The jargon of On Becoming a God, of course, isn’t fictional. It’s the jargon of pretty much every MLM, a particular brand of an evangelizing cult that sells the prospect of wealth and success.

In structure, an MLM is simple: the workforce of the company is a network of distributors, designated as independent contractors, who pay for products, rallies, access, motivational tapes, etc., in order to recruit more distributors to buy product and recruit yet more distributors, all seemingly under the impression that the set-up is in actuality a distributor’s own business. But there’s something less simple about how the clubby, cloying homilies manage to dupe so many people. The jargon of On Becoming a God, of course, isn’t fictional. It’s the jargon of pretty much every MLM, a particular brand of an evangelizing cult that sells the prospect of wealth and success to millions, despite the fact that only about 1 percent of MLM participants ever see profit of any kind. Then again, because of the gradual weakening of Federal Trade Commission (FTC) regulations over the many decades since the first MLM, Nutrilite, appeared on the scene, most MLMs have been ruled to be legal, and are not, according to the FTC, inherently synonymous with pyramid schemes. And though it was forged in Christian Evangelicalism, the modern MLM tends to downplay religious fervor, of late targeting predominantly women. Companies like Mary Kay and Avon—and more recently, LuLaRoe—have had great success in drawing in women by focusing on a community of interest in beauty products.

The recession played no small part. In 2008, Mary Kay launched ambitious television advertisements. In April 2011 alone, the company signed up 165,000 consultants. The following January, the company touted a 15 percent increase in sales during the previous year.

The chain of evangelizing creates a faithful legion. Herbalife, the company with the third-highest revenues among all MLMs in 2017, had approximately seventeen times as many distributors as Apple had full-time-equivalent employees in 2018; twenty-nine times as many as Royal Dutch Shell. Avon, with the second-highest, had forty-five times as many as Apple in 2018, globally. The titanic disjuncture in America between the inevitability of failure and the cult-like behaviors that seek to convince people that they can become impossibly rich is a comically apt symbol for how American neoliberalism has functioned since at least the 1970s: the business as casino, the targeted conversion of particularly vulnerable demographics, the gnashing of the hopes and dreams that fell through the cracks of legal loopholes and Kafkaesque bureaucracies. More specifically, it’s a state of affairs dramatized by the immensely successful model created by the company FAM is meant to represent: Amway.


The scope and scale of the damage that MLMs have wrought is unknowable, unless somehow every single former distributor were to put the extent of their damages into the public domain. But the downsides of these companies have never been much of a secret. Despite the esoteric nature of MLMs, their grip over Beltway actors have made them visible for quite some time.

This is particularly true of Amway—a company that initially sold only soap but has now become identified with the juggernaut of American evangelical conservatism. Amway was founded by two food supplement distributors for the door-to-door, direct-selling company Nutrilite, which is now owned entirely by Amway. Richard DeVos (father-in-law to Trump’s education secretary Betsy DeVos) and Jay Van Andel founded the American Way Association in Ada, Michigan, in early 1959 and later that year set up the Amway Sales Corporation and Amway Services Corporation. The key to its success, and the model it created for other MLMs, was that DeVos and Van Andel set up not one but multiple companies that were renamed several times over the years. There’s the “Amway Corporation” that today employs more than sixteen thousand employees. And then there’s the autonomous organization at the heart of the system: the Amway Distributors Association, originally established in 1966, and which became the Independent Business Owners Association International, Inc. in 1999. It is responsible for the arcane hierarchy that motivates distributors (tiers include Producer, Ruby, Sapphire, Emerald, and the deified all-but-unattainable Diamond, Multi-Diamond, and Crown tiers). Not only does the creation of an autonomous organization lay at the heart of Amway’s economic success, it also served to differentiate Amway from old-fashioned, clearly illegal pyramid schemes. The FTC in 1979 found Amway guilty of price-fixing and exaggerating sales and earning claims, but also ruled that Amway as a whole did not meet three basic criteria for a pyramid scheme: it was based on retail sales, did not require participants to “pay to play,” and did not directly remunerate distributors for recruiting people. Thus, the FTC ruled, it was not a pyramid scheme.

It’s evident today that this was a matter of legalese contorting itself around reality. After all, the basic idea found in MLM stories in the public domain is that the companies get things done by behaving like cults, thereby having little necessity for explicit coercion. When it came to Amway events, for instance, many former distributors have noted that attendance was implicitly required and the ticket had a fixed price; distributors, for example, couldn’t cut costs on hotel reservations in the cities where rallies were held, for instance, even if they stayed with relatives. The former distributor Stephen Butterfield has written that “for committed distributors, taking to heart the admonition that every function is vital, and wishing ‘to stay plugged in,’ the claim of the organization on their time and interest is total.” Moreover, not only is Amway essentially predicated on selling more products to distributors than they can possibly sell, its distributors are almost always customers at first who are later sweet-talked into joining. The ruse lies in convincing people that becoming a distributor is taking up an opportunity, that Amway “just [provides] a financial vehicle to take us from where we were to where we wanted to go in life,” as another former distributor wrote. (Twice in the Showtime version, Krystal is told, verbatim: “Look at where you are. Think about where you want to be.”)

“Look at where you are. Think about where you want to be.”

However clever DeVos and Van Andel were in setting up a unique model that escaped FTC strictures, it is perhaps reasonable to assume that they—and other big MLMs—would have gotten away with it anyway. Over the past five decades, former FTC officials have gone on to work at MLMs like Herbalife and Amway, and MLM-affiliated officials have been appointed to the FTC. One former head of the FTC was directly affiliated with Amway (during the Bush administration). Van Andel served as the chairman of the U.S. Chamber of Commerce from 1979 to 1980. The DeVos family and Van Andel have given millions to the Republican National Committee (RNC), both directly and through organizations like the Council for National Policy, Progress for America, the Acton Institute, the Heritage Foundation and hosts of other hard-right think-tanks, political groups, political campaigns, and media conglomerates. During the 1980 and 1984 elections, Amway rallies across the country were used for the express purpose of drumming up support for Ronald Reagan. Amway leaders have poured millions into every presidential election since.

This has hardly been a behind-the-scenes operation. Celebrities like Bob Hope have filmed Amway TV commercials, and religious leaders like Bob Harrington and Robert Schuller have used massive Amway rallies to explicitly tie the evangelical mission to the “free enterprise” mission. In turn, Amway leaders such as the DeVoses have arm-twisted and shepherded through the political process conservative proposals from charter schools to right-to-work laws to anti-gay rights legislation. In 1997, Newt Gingrich, then House Speaker, engineered a last-minute tax break of $283 million for the company. Gingrich is one of many prominent Republicans who has spoken at an Amway rally or conference. (Bill Clinton has praised the Direct Selling Association and Madeleine Albright has been deeply involved with Herbalife.)

Indeed, at one point in the nineties, there were enough elected officials to form an informal Amway caucus in Congress. To take just one example: Sue Myrick, a former House representative for North Carolina’s ninth congressional district who joined Amway in 1992, won election to her House seat in 1994 after speaking at hundreds of rallies where Amway leaders often passed buckets for contributions, logging the names of donating distributors. The Crown-level multimillionaire Dexter Yager used Amway’s voice-mail messaging system and his entire downline to fund Myrick’s campaign, with Myrick eventually raking in $295,871 through Amway; many donors were outside Myrick’s district. Over the course of her career, Myrick oversaw much Amway-friendly legislation.

If this seems less visible today, it’s partly because Amway long ago went global. By the end of the 1970s, Amway distributors had tapped Canadian, Australian, West German, English, and other international markets. But the company has also landed in hot water in other parts of the world. In 2011, police raided multiple offices and distribution centers of Amway India, founded in 1998, and in 2013 Amway India’s CEO and two other senior executives were arrested; the CEO was arrested again in 2014 and 2018. The incidents took place as a result of consumer complaints and allegations of cheating.


The world of FAM in On Becoming a God is evocative of what Amway looked like in the 1990s. In a gut-wrenching turn of events, Krystal’s neighbor, Ernie, a pure-hearted, earnest believer she has conscripted into FAM, inadvertently finds himself translating for undocumented immigrants; soon, he realizes that this vulnerable demographic, too, is in need of the “opportunity” he’s been given. Vice President Dan Quayle (played by an actor) shows up in another episode at an election fundraising dinner where he rubs shoulders with wealthy, Dexter Yager-like upper-level distributor Obie Garbeau II. Perhaps what is most striking about the storytelling in On Becoming a God, however, is how it goes against the grain: Krystal Stubbs, the inveterate unbeliever, tries on numerous occasions to expose or otherwise bring down FAM, but it becomes clear that it’s impossible due to the sheer burden of her poverty. What could easily have turned into a quintessentially Hollywood story about a furious woman overturning an unjust system turns into a story zooming out to show the byzantine twists and turns in a vast maze.

But the show also conjures another phenomenon: that of the MLM personal story, the one plastered across the internet in anti-MLM websites, threads, essays, and blog posts—a never-ending archive of alienation, divorce, and bankruptcy. The stories of people brought to ruination are so voluminous, in fact, that they seem to constitute a genre of their own. The narrative of the self; telling the real personal story after having been destroyed, no matter how abject, is how many victims of pyramid schemes choose to reclaim agency in their own lives. Posters on Reddit ask for advice on how to talk to their relatives who are mixed up in a pyramid scheme, and inevitably many commenters offer advice on how to gently undo such indoctrination. Others post pictures of MLM flyers they’ve torn down or defaced. Like On Becoming a God, which finds laughing at misfortune somewhat distasteful and saves the jokes for the ludicrousness of FAM, anti-MLM Reddit sees the victims of pyramid schemes, at worst, as dupes—but dupes deserving of sympathy nonetheless. Real rancor is reserved for the superstructure.

It may seem like a hokey, banal genre of woe and misfortune, but it also seems to be everywhere. In the show, one of the best episodes sees Krystal meeting with Obie Garbeau II’s wife Louise, in an attempt to grovel her way out of FAM’s grip. Louise ushers her into what can only be described as a therapeutic “orifice.” “How do you feel?” asks Louise when the therapy is complete. Krystal’s weariness alights with barely-concealed rage as she snarls, “I feel like . . . I physically fought myself out of a fucking vagina tub for no goddamn reason.”

Louise continues to egg Krystal on for more details about her feelings, and Krystal quivers with rage, too exhausted even to restrain her eye-rolls. Dunst hunches, her face flickering from fury to a sadness she rarely allows herself to express, and shame too—shame for debasing herself for FAM, shame for opening up to one of its figureheads. Finally, she spits out: “I gave birth alone, because my husband was working for you. And now he’s fucking dead because of you. Because of fucking FAM!” Unlike the common MLM personal story, this one feels an awful lot like the speaker has been forced to give up the little dignity she’s fought so hard to retain, the rights to her own story. It’s hard to think of a better character-based way to depict how an economy of dignity has been abandoned in favor of the coercive economy of the legalized scam.

Kamil Ahsan is a biologist and historian who has written for The Nation, Dissent, and the L.A. Review of Books, among others. 
 
 
 

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