https://podcasts.apple.com/us/podcast/illegal-tender/id1486637630
Yahoo Finance Podcast on MLM Is a Milestone in Business Media Coverage
Yahoo Finance’s remarkable 3-episode podcast on multi-level marketing, Illegal Tender, Season 4, should be recognized as a milestone in business media coverage of MLM. For the first time – without equivocation and without entertaining even a hint of diversionary and unmerited question of MLM legitimacy – a major business media source has presented the MLM phenomenon straightforwardly. MLM is revealed as it is, a financial predator, a cultic pseudo-business, a Ponzi in plain sight.
Yahoo Finance reporter, Stephanie Asymkos’s podcast marks the first time the business media has dealt strictly in reality about MLM and acknowledged the real-life experiences of millions of people of extreme deception, psychological manipulation and financial loss at the hands of MLM promoters, with no personal recourse to the courts or government.
This groundbreaking work in business journalism does have one, only one, predecessor. It was the 2013 CNBC documentary produced by business analyst and journalist, Herb Greenberg, Selling the American Dream. Greenberg broke from his business media peers by questioning the economic legitimacy of all MLMs. He also revealed the shamefully submissive face of federal regulators. In a shocking on-camera interview conducted by Greenberg, the FTC’s head of consumer protection at that time, David Vladeck angrily sought to deny that massive consumer losses are evidence of MLM injury or deception.
Facing an enormous wall of media denial and government protection of MLM, Greenberg had to approach MLM realities as a provocative question, a question that no one had dared to raise, which was whether the entire MLM “industry” is not a real business at all but a gigantic scam. This was courageous journalism. Yahoo Finance’s podcast stands on Greenberg’s work by going directly to reality, without giving the question of MLM legitimacy any semblance of validity or substance, which it does not deserve.
With rare exceptions (see the work of business writer, Michelle Celarier) the media has a long and painful history of denying, ignoring or routinely describing the entire phenomenon of MLM in false terminology of legitimate “income opportunity” or as actual “direct selling.” This cannot be explained by lack of information. The facts of 99% consumer loss rates, absence of a retail customer base, industrial-scale deception, regulatory corruption and capture, snake oil products, entrapping pyramid structure, pilfering pay plan and destructive cult persuasion methods have been documented and available for many years. So how to account for this gross failure?
Having been interviewed by the business news media more than any other person in the world for articles and stories on MLM, I attribute this institutional dereliction to two systemic causes:
Ideological Bias
Business journalists in the USA, where MLM was invented and is mostly headquartered, are required by the media institutions they work for to uphold and pay homage to virtually any enterprise that makes someone – anyone – rich and produces profit for shareholders, regardless of means or consequences. This ideological bias reduces business news to reporting financial results selectively and superficially, reducing it to economic propaganda. It requires ignoring or denying wide swaths of reality. It allowed Bernard Madoff’s Ponzi to operate openly for years without examination. It rebuffed credible whistle blowers and ignored a mathematically impossible record of “returns.” It blithely missed the red flags of the looming housing/mortgage/securities crash in 2008. Day-to-day, it treats the abuses and lethal failures of the American health care system, the existence of non-competitive monopolies and duopolies, pervasive low wages requiring millions to hold two or more jobs, urban housing shortages, and crushing student debt as normal “market” phenomena. Business journalists wear blinders to the toxic effects of a private prison “industry” on poor communities and society in general. From fossil fuels that raise sea levels to home evictions and rent gouging by Wall street syndicates, human misery at the hands of virtually any schemes calling themselves “businesses” is largely glossed over or simply ignored. Ideological bias cannot allow contradiction or failure.
MLM’s chief disguise is that of a “sales business.” It operates like a fundamentalist religious cult. It violates laws of supply, demand and market saturation. It has no retail customer base and therefore no price competition. It even discloses near 100% loss rates of its “distributors,” but since all is done in the name of “business,” the business media grants immunity from inquiry into its fundamentals. MLM’s “profits” and expansion are lauded as proof of legitimacy. Quota-based purchasing for “income” eligibility based on pyramid recruiting is called “product demand.” Questioning the validity of the MLM “business” – as Herb Greenberg did – becomes journalistic heresy.
As part of this ideological bias, journalists must also dignify corrupted regulators as valid authorities. Regulators’ dereliction of oversight and revolving-door work in and out the very scams the are supposed to regulate are treated as normal. Most business journalists bow to this orthodoxy. Those that don’t are weeded out.
Class/Sexist Bias
As the Yahoo Finance Podcast makes clear, the main targets of MLM deception and predation are women, more specifically working women and mothers seeking to bolster struggling family finances. Some MLMs target immigrant women; others hit military spouses. Millions of men are also entrapped, directly and indirectly, but Stephanie Asymkos’ production acknowledges and focuses on MLM’s primary target population and the cruel deceptions and devious manipulations MLM has designed specifically to defraud working women.
The business media’s bias against women and especially working class women is institutional. Its obsessive focus on male-dominated Wall Street, its clownish male pundits, its worship of male billionaires and CEOs, and revelations of discrimination and abuse within its own ranks that the Me-Too movement has uncovered are only surface indicators. Deeper manifestations include ignoring the plight of tens of millions lower wage workers and the gender-based wage discrimination all women face.
MLM’s plundering of the hopes, needs, and limited options that working women face today is therefore given little consideration by the business media. Losses and failure rates are ascribed to market forces. Rhetoric about “opportunity” is accorded substance without inquiry. The consequences of MLM – alienation of friendships, divorces, addictions, shame, bankruptcies and debt – are written off as costs of “entrepreneurship.” In sum, the business media’s dogmatic orthodoxy that protects MLM is further reinforced by its bias to ignore the lives and economic realities of MLM’s primary victims who happen to be women.
Though news media institutions and the business news media in particular have a sad history driven by these biases and orthodoxy, civil society has found other sources for truth about MLM. Citizen journalists, whistle-blower blogs, website and podcasts have spread the truth in underground fashion for more than three decades, often at the costs of threats, ridicule, lawsuits and job losses. More recently the truth has emerged in popular culture with the John Oliver Show, sitcoms like Schitts Creek, and the Showtime series, On Becoming a God in Central Florida. These popular productions, though offered with humor or fictional drama, have begun to affect the tone of news media coverage of MLM, moving it closer to reality-based.
The Yahoo Finance podcast, Illegal Tender, Season 4, on MLM is a breakthrough for the business media that will open the door for reality to replace the fantasy and propaganda that have prevailed.
Robert L. Fitzpatrick (copyright 2020)
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