The DeVos Family Is The Face Of American Oligarchy
9:01 AM EST on February 25, 2021
Welcome to Better Hate An Owner, a recurring feature in which we learn more about all those awful old people who get to hold the trophy first at championship ceremonies. Today's entry is about the DeVos family, which owns the Orlando Magic.
How much of their soul did they lose in making their money?
As we will get into in detail down below, a lot!
Are they fail-children?
The team's chairman, Dan DeVos, is indeed a fail-child. His father Richard bought the team in 1991, and though Dan took over a few years before his old man croaked in 2018, team ownership has always been a family affair. DeVos business is adjudicated at the clan level, so to focus on just a single member of the family would be to misread the structure of their sprawling enterprise. I use that word deliberately, because they run their family like a cold multinational. From Richard's 2014 book, Simply Rich:
“We formed the DeVos Family Council, which is made up of our children and their spouses and meets four times a year. The Family Council just approved a family constitution that essentially captures our family mission and values. … The Family Council also articulates how the family will work together in managing our shared financial interests and our philanthropy.“We also have the Family Assembly. ... When grandchildren turn 16, they are inducted … in a formal ceremony that everyone attends. An aunt or uncle makes a presentation of their achievements, reminds them of their responsibility as they go forward, and affirms them as a member of the Family Assembly. … They are able to vote in the meetings at age 25, after they have met additional qualifications for taking on this added responsibility.”
The DeVos brood is linked to another Western Michigan billionaire clan, the Prince family, through Betsy Prince's marriage to Dick DeVos. Both families are worth billions of dollars, both have perfectly aligned ideological aims, and together, they have set out to rule Michigan like a fiefdom.
It would be a crime to let this section pass without mentioning Dick's failed political ambitions. He ran for governor of Michigan in 2006, pumping a then-state record $35 million of his own money into the campaign. That was more than twice as much as incumbent Jennifer Granholm raised. DeVos still lost by 14 points.
How much public financing have they sucked out of the community?
The Magic picked up only 10 percent of the bill for their $480 million arena that opened 10 years ago. So: a whole bunch.
The Epstein Degree: How many degrees removed from Jeffrey Epstein are they?
We can get there in two or three, and since each route to Epstein involves a different member of the family's two most obviously evil (living) people, it's useful to spell them both out here.
1. Betsy DeVos was Secretary of Education under Donald Trump, who was friends with Epstein for decades and flew at least once on the "Lolita Express." He also gave one of the most eyebrow-raising quotes of all time, telling New York magazine in 2002, “I’ve known Jeff for 15 years. Terrific guy. He’s a lot of fun to be with. It is even said that he likes beautiful women as much as I do, and many of them are on the younger side.”
2. Betsy's brother Erik Prince is the founder of the infamous private war company Blackwater, which has gone through several iterations and is now the Chinese-state affiliated Frontier Services Group. Prince can be linked to Trump directly—here he is in the pages of the New York Times begging Trump to let him become chief warlord of Afghanistan—though that's too easy. Prince worked with the powerful Barak family, including on some sketchy intelligence-adjacent technology sales, and former Israel Prime Minister Ehud Barak has been accused of deep involvement with Epstein.
What are their political affiliations?
Believe it or not, the political affiliations of the family of the most notorious private military contractor and the Trump administration's Secretary of Education are extremely conservative. Most owners who furnish right-wing causes and politicians do so in a somewhat piecemeal manner, and the reciprocal influence is equally piecemeal. A million dollars here or a $250,000-per-plate fundraiser at a Beverly Park mansion there gets you a make-work contract here or a job for your idiot nephew there.
But not the DeVos family. The heft and breadth of their decades-long campaign of donating to candidates and campaigns at every level, across many states, is not about installing a favorable candidate or supporting an individual law. It is in service of an expansive ideological project of privatization, the ritual sacrifice of the commons. Detailing individual donations, without spelling out the pattern, fails to capture what's going on. At her confirmation hearing in 2017, Betsy DeVos said it was possible that her family had given away over $200 million to various Republican politicians, putting them in a class with the Kochs and Mercers. Ideologically speaking, they're in lockstep with those assholes. The cleanest example: The family gave more than $750,000 to campaigns for successful laws banning gay marriage in Michigan in 2004, and then both Florida and California in 2008.
Education is their main issue; specifically, the end of it as a public or secular institution. The DeVos and Prince families share a zeal for pushing Christian education at all costs. Even with the failure of a prominent 2000 ballot measure that would have guaranteed public funding for religious and charter schools in Michigan, the family's wealth is so enormous that they still control Republican politics in the state. In 2016, they gave $1.45 million to Republican officials after they successfully beat back a challenge to lightly regulate Detroit charter schools.
Can we fairly say the DeVos clan is buying influence? Let's see what Betsy wrote in 1997, per the New Yorker (emphasis mine):
“I have decided to stop taking offense,” she wrote, “at the suggestion that we are buying influence. Now I simply concede the point. They are right. We do expect something in return. We expect to foster a conservative governing philosophy consisting of limited government and respect for traditional American virtues. We expect a return on our investment.""People like us,” she added archly, “must surely be stopped.”New Yorker
In 1949, Jay Van Andel and Richard DeVos began selling vitamins. The childhood friends had spent the previous few postwar years starting a flying school despite not knowing how to fly and then sinking a big sailboat off the coast of Cuba because they didn't know how to sail, either. After Van Andel's second cousin told the pair about a line of vitamins called Nutrilite, they attended a sales conference in Chicago and signed on to hawk the pills. You made money as a Nutrilite distributor not just by selling the vitamins, but by getting commissions on the sales of other people you got to sign up as distributors. Nutrilite was one of the first companies to take advantage of multi-level marketing, and it has been built up into the 49th largest private company in the United States.
The company is now called Amway, which brought in an estimated $8.4 billion in sales in 2019. The malign influence of the DeVos family is a mighty force, and their campaigns to destroy education, impose a Christian theocracy, and privatize the last remnants of the welfare state are, on the merits, more evil than running a big MLM company. If we were to simply tick through the family's greatest hits, then the Nisour Square massacre, this summer's astroturfed anti-lockdown protests, and the donation list would definitely warrant more attention than Amway. However, the entirety of the DeVos project—save for possibly Blackwater—is only possible because of Amway. To understand the family, it's essential one understands the roots of their power.
Amway isn't a benign vitamin company; mutual exploitation is baked into the enterprise at its core. Amway is not the biggest company in America, but I'd argue that the sheer scale of its inherent fraudulence makes it perhaps the most American company. There really is no there there, just suckers scamming suckers all the way down for the benefit of a family of right-wing zealots. What could be more American than that?
MLM is simple. Start with a company at the top which sells a product to a network of distributors below them. Those distributors then turn around and sell access to the product to another network of distributors below them, and on and on it goes. You get a cut for every product sold by the people below you and the people below them; whoever is above you gets a cut of all your sales.
The selling of the actual product—in Amway's case, dubiously effective health supplements—isn't really the point. Growing a network of distributors underneath you is where the real money is. As of 2012, Holly Chen got a cut from one in every 10 Amway sales, made at least $8 million per year, and held lavish conferences. If this sounds like a pyramid scheme, well, here's the Federal Trade Commission:
The Commission held that, although Amway had made false and misleading earnings claims when recruiting new distributors, the company's sales plan was not an illegal pyramid scheme. Amway differed in several ways from pyramid schemes that the Commission had challenged. It did not charge an up-front "head hunting" or large investment fee from new recruits, nor did it promote "inventory loading" by requiring distributors to buy large volumes of nonreturnable inventory
See, it's more of a "reverse funnel system."
Amway paid out big class-action settlements, was found guilty of price fixing, and used Betsy DeVos to push through deregulations of MLMs and pyramid schemes, though they are clearly now established as the biggest player in the MLM world. Whether or not the FTC wants to rule them illegal, MLMs are definitionally exploitative. In the same way the proliferation of the "gig economy" and contract work is an end-run around capital's "paying for labor" problem, MLM is a similarly slick way to get around the "limits on return of capital" problem. Like Uber and Lyft, Amway is only successful at the scale it is because it made a smart bet that it could outrun the law. Those two companies at least provide a service, whereas Amway is really just diarrheal capitalism.
A 2011 study from the Consumer Awareness Institute found that "less than 1% of MLM participants profit," with the author ruling, "MLM makes even gambling look like a safe bet in comparison." The hollowness at the heart of MLM's get-rich-quick promise is the cleanest example of capitalism's inherent centralizing of profit. The myth that MLM firms sell, that you can generate a large and mostly passive income simply by selling some soap or whatever, relies, as a rule, on finding new suckers to scam. And in the same way imperial capitalism relies on the creation of new markets, Amway has responded to regulatory scrutiny and tightening profit margins at home by focusing most of their energy abroad. Per a 2012 WSJ story, 90 percent of Amway's sales come from outside the U.S.
Fraudulent as it is, the appeal of the Amway model is at least rational. Who wouldn't want to generate millions of dollars a year by ginning up a force of thousands of sales employees under you? The creakiness of the scheme isn't hard to see, but the lie sells even better in increasingly precarious economic times because it at least offers a simple path to making money. The shadiness is tough to sniff out when it's wrapped up and sold to you as a luxury product. You will not necessarily see the big stack of people on top of you, but you will see the lavish lifestyle and lightly cultish trappings. Here's a telling bit from a 1997 Baffler story about an Amway convention:
As its hands reached “midnight,” the Rolex dissolved into a series of video montages depicting the consumer Shangri-La that our own forthcoming Amway success would open for us. We leered as a day in the life of a typical jobholder—all alarm clocks, traffic jams, and dingy cubicles—was contrasted with that of an Amway distributor, who slept in and lounged the day away with his family. We gawked hungrily as real-life Amway millionaires strutted about sprawling estates (proudly referred to as “family compounds”) and explained that such opulence was ours for the asking. We chortled as a highway patrolman stopped an expensive sports car for speeding—only to ride away a moment later with an Amway sample kit strapped to his motorcycle. Our laughter became a roar of delight as the camera zoomed in on the sports car’s bumper sticker: “JOBLESS … AND RICH!”The Baffler
This is all obfuscation, essential to keeping the plain material realities from appearing as they are. You are never supposed to see those below you, in the same way you are never supposed to see the gross ways money buys influence. It's at the heart of Amway, the DeVos empire, and the way dark money works in politics. Hell, it even touches the Orlando Magic.
Take, for example, the impressively labyrinthine answer to the question, "Who owns the Amway Center?" For most NBA teams, the answer is simple. The city of Sacramento owns the Kings' arena. Not in this case. Per the Wall Street Journal, the Orlando Sportsplex is a subsidiary of Orlando Sportsplex, Ltd., which is itself a subsidiary of Orlando Sportsplex, Inc. and RDV Capital Management, L.P., which is owned by OAPC, G.P., a subsidiary of Ottawa Avenue Partners, LLC, which is owned by the RDV Corporation. I guess the DeVos family really hates paying taxes!
If you understand the packaging of the MLM luxury lifestyle less as an attainable thing and more as the incandescent bauble dangled in front by an anglerfish, it is not a leap to identifying the Orlando Magic as, essentially, the biggest such bauble of all. NBA ownership is both a PR laundry machine and a gaudy status symbol, because after all, there are only 30 teams. The DeVoses' ownership of such a rare and valuable asset is the ultimate sales pitch for MLM. They did it, so why can't you?
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