An Awkward Truth About American Work
A few years ago, a cheeky meme made the rounds on the internet—a snappy rejoinder to a question about dream jobs: 'I do not dream of labor.'
The witticism, sometimes misattributed to James Baldwin, began to spread a few months into the coronavirus pandemic, as the shock of mass layoffs started to give way to broader dissatisfaction with work. Before long, an untethering from office culture, combined with the security of a tight labor market, led many workers to quit their 9-to-5 jobs. Nobody, Kim Kardashian declared, wanted to work anymore—but that wasn't exactly true. More plausibly, the "Great Resignation" marked a shift—perhaps a permanent one—in when, where, and how people wanted to work.
Moments of cultural change present openings for cons. Early in the pandemic, the number of multi-level-marketing schemes (or MLMs) exploded online. Such enterprises invite non-salaried workers to sell goods and then also earn commissions by recruiting more salespeople; the Federal Trade Commission has over the years outlined subtle legal differences between MLMs and pyramid schemes. As millions of Americans lost or quit jobs, MLM advocates on the internet made an enticing pitch: Work as we knew it wasn't cutting it anymore; other options were out there. Framing the chance to hawk leggings or makeup or 'mentorship' as an opportunity that could yield flexible income and a sense of community, they promised a kind of life that was too good to be true.
A few years ago, the journalist Bridget Read started looking into the outfits behind such appeals. Initially, by her own account, Read couldn't really understand how MLMs worked. But some big questions stuck with her—among them, why exactly they were legal. She lays out what she's learned in her engaging new book, Little Bosses Everywhere: How the Pyramid Scheme Shaped America, which exposes some awkward truths about the nature of American work. Weaving in sympathetic portrayals of women who lost money and friends after working with MLM schemes, she recasts them as victims of a multigenerational swindle.
[Read: LuLaRich reveals a hole in the American economy]
MLM participants surely drive their friends and family crazy with their hard sells; they are also, in Read's telling, marks. She cites a 2011 analysis that found that 99 percent of participants in one MLM lost money, and she exhaustively catalogs the predations of the sector writ large. Read writes with scorn about the industry's early architects, who made outrageous health claims and touted their companies' 'profits pyramid,' and about right-wing opportunists who expanded MLMs' power and reach—especially the founders of Amway, a massive company with connections to Ronald Reagan and Donald Trump. But she never disparages her sources, whose stories of drained bank accounts and dashed dreams she portrays only with empathy. She threads the tale of a pseudonymous Mary Kay seller, a military veteran struggling to make ends meet, throughout the book. The woman loses more than $75,000. These vignettes keep the human toll of the schemes top of mind.
Read's indictment of MLM outfits is predictable enough, but her research also reveals how much corporate America has in common with this shady economy, which has long been dismissed as a kooky sideshow. Corporations have borrowed from the methods of MLM companies—hiring large, contingent workforces; pushing employees to think like entrepreneurs; and lobbying hard for friendlier regulations. MLMs turn out to be more closely aligned with the center of corporate life (and political power) than many people might like to think.
A key innovation of the industry was to rely on a fleet of temporary workers. During the Great Depression, when Franklin D. Roosevelt's administration was expanding the social safety net and implementing muscular work protections, an organization then called the National Association of Direct Selling Companies agitated for a carve-out that would designate salespeople as 'independent contractors' rather than employees. Historically, such contractors had occupied a tiny niche, but in a time of expanding regulation, classifying workers in this way became a handy loophole. This category later set the template for tech start-ups, including Uber and DoorDash, that challenged traditional full-time employers. As of July 2023, about 4 percent of the American workforce had temporary jobs as their main or only role, and an additional 7.4 percent of Americans were independent contractors, according to a survey from the Bureau of Labor Statistics. That percentage may seem small, but it encompasses millions of workers and outnumbers many sectors of employment; other surveys find that tens of millions of Americans do such work for supplemental income too. As Read writes, 'The part-time, low-paid work that direct selling pioneered' now 'defines our current labor market rather than covers its gaps.'
The low quality of many legitimate jobs has long provided cover for shadier schemes. Squint, and an MLM racket doesn't look all that different from the work of an influencer or telemarketer or door-to-door-salesman. If a major indictment of MLMs is that many of their contractors don't seem to actually sell much at all, well—the same could be said of many other jobs today. And the gig economy isn't walled off from the rest: Many Americans still have full-time, union-eligible jobs, but a lot of them dip into temporary or part-time work to make ends meet. The Mary Kay annual meeting features a special cheering moment for teachers who sell makeup on the side.
[Read: When multilevel marketing met Gen Z]
Many of the messages that MLMs adopt to reel in workers rely on a central contradiction, criticizing the corporate grind while extolling the free market. Amway recruiters, for one, have explicitly used anti-establishment language in their pitch: When you're working a 9-to-5, you are in the 'rut,' but when you break free and set your own hours, you are living 'the dream.' In fact, you are often forsaking security for precarity—or worse. As Read and others have written, the opportunity quickly becomes a disaster for all but a very lucky few. MLMs and their boosters deny that the companies are pyramid-shaped—Amway, according to one hagiographer, is shaped more like 'a flower.' But each, in Read's telling, also takes the form of a fun-house mirror.
Throughout the history of MLMs, contractions and collapses in the broader economy have been good for them. Direct selling was hailed as 'counter-cyclical' and 'depression-proof' during the 1930s, Read notes. In the 1970s, widespread white-collar layoffs and looming stagflation presented another opening. 'In the direct selling business hard times are good times,' the founders of Amway wrote in a 1974 edition of their corporate magazine. In more recent decades, the sector's free-market ethos dovetailed with new cultural moods: MLMs both shaped and reinforced the values of the greed-is-good 1980s, as well as the self-help-obsessed aughts and the 'grindset' ethos that followed the 2008 recession. Seizing opportunities to grow businesses is, of course, what companies have always done. But this industry seized them to advance practices that flirted with, and sometimes qualified as, outright fraud.
Read ably explains why these businesses have appealed to generations of underpaid and insecure American workers, and she argues that it's not greed or stupidity that drives people (especially women juggling family responsibilities) into the arms of the schemes but the decline of middle-class stability. MLM opportunities promise what American jobs used to: security, freedom, dignity. Those promises have consistently failed to materialize. But the fact that so many are desperate to get in on the schemes each year is not a credit to the broader job market. A person well served by the economy is unlikely to salivate at the prospect of making extra cash by pushing lipsticks on the side. Today, many workers at more conventional jobs face the havoc of just-in-time scheduling and inconsistent shifts; these employees seek out more flexible arrangements in spite of their downsides.
In Read's telling, MLMs are a toxin masquerading as a cure. Among their many ruses is their insistence on a message of empowerment: that participants are 'bosses' or 'owners.' What makes this easier to pull off is the fact that MLM outfits don't have the kind of central, visible leader the public associates with many higher-profile schemes—no Sam Bankman-Fried or Bernie Madoff or Elizabeth Holmes. Read names the leaders who benefit, and in doing so, she delivers a damning portrait of those who take advantage—and she humanizes the people they rip off. Investigating an industry notorious for doublespeak and euphemism, she calls things what they are.
Article originally published at The Atlantic
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Hill
an hour ago
- The Hill
GOP tax bill would mean 11.8 million people uninsured, $1.1 trillion in health cuts
The Senate Republicans' tax and spending bill, which is speeding through the chamber, would result in deeper health care cuts and more people without insurance than the version that passed the House, according to a report from the Congressional Budget Office. The legislation would result in 11.8 million Americans without insurance by 2034, CBO found: nearly 1 million more people without insurance than the House version. That amount includes an estimated 1.4 million people without 'verified citizenship, nationality, or satisfactory immigration status' who would lose their state-funded coverage. The legislation would also cut federal spending on Medicaid, Medicare and Obamacare by $1.1 trillion, with more than $1 trillion coming from Medicaid. The CBO's analysis confirms that despite President Trump's repeated pledges he was only cutting waste, fraud and abuse in Medicaid, the legislation would enact an unprecedented reduction in the program currently used by more than 70 million low-income Americans. The bill would achieve its savings in various ways, but the bulk of the cuts come from a strict national work requirement and new restrictions on state-levied taxes on health providers. Under the bill, for the first time in the history of the Medicaid program, beneficiaries would need to prove they are working or in school at least 80 hours a month to keep their health insurance. The Senate version extends the requirement to low-income parents of children older than 14, in addition to childless adults without disabilities. The work requirements are projected to save about $325 billion over a decade. The provider taxes were the second-largest Medicaid cut in the House bill, after the work requirements. The cuts are even larger under the Senate design. Those changes would reduce spending by nearly $191 billion over a decade, according to the CBO estimate. The provider tax provisions have been among the most controversial in the Senate. States impose taxes on providers to boost their federal Medicaid contributions, which they then redirect to hospitals in the form of higher reimbursements. Limiting provider taxes is a long-held conservative goal, as they argue states are gaming the current system and driving up federal Medicaid spending. But senators representing states with poor, rural populations have objected to the scale of the cuts, including Sens. Josh Hawley (R-Mo.), Susan Collins (R-Maine), Lisa Murkowski (R-Alaska), and Thom Tillis (R-N.C.). The House bill would freeze the tax rate for most states, but the Senate version would require many states to lower their existing rates. As an incentive for senators uncomfortable with the provider tax cuts, the bill includes a $25 billion fund to aid rural hospitals. But that amount wasn't enough to sway Tillis, who voted with Democrats against a procedural motion late Saturday night. Hawley voted for the motion and said he would support the bill despite his misgivings over the Medicaid cuts. Additional details of the bill are in flux as negotiations between Republicans continue and the Senate parliamentarian reviews key pieces of the bill to determine if they follow the legislative rules. Lawmakers are facing down a White House-pushed July 4th deadline to pass the bill in the Senate, and then again in the House, and put it on President Trump's desk.
Atlantic
an hour ago
- Atlantic
How to Assess the Damage of the Iran Strikes
In August 1941, the British government received a very unwelcome piece of analysis from an economist named David Miles Bensusan-Butt. A careful analysis of photographs suggested that the Royal Air Force's Bomber Command was having trouble hitting targets in Germany and France; in fact, only one in three pilots that claimed to have attacked the targets seemed to have dropped its bombs within five miles of them. The Butt report is a landmark in the history of 'bomb damage assessment,' or, as we now call it, 'battle damage assessment.' This recondite term has come back into public usage because of the dispute over the effectiveness of the June 22 American bombing of three Iranian nuclear facilities. President Donald Trump said that American bombs had 'obliterated' the Iranian nuclear program. A leaked preliminary assessment from the Defense Intelligence Agency on June 24 said that the damage was minimal. Whom to believe? Have the advocates of bombing again overpromised and underdelivered? Some history is in order here, informed by a bit of personal experience. From 1991 to 1993 I ran the U.S. Air Force's study of the first Gulf War. In doing so I learned that BDA rests on three considerations: the munition used, including its accuracy; the aircraft delivering it; and the type of damage or effect created. Of these, precision is the most important. World War II saw the first use of guided bombs in combat. In September 1943, the Germans used radio-controlled glide bombs to sink the Italian battleship Roma as it sailed off to surrender to the Allies. Americans developed similar systems with some successes, though none so dramatic. In the years after the war, precision-guided weapons slowly came to predominate in modern arsenals. The United States used no fewer than 24,000 laser-guided bombs during the Vietnam War, and some 17,000 of them during the 1991 Gulf War. These weapons have improved considerably, and in the 35 years since, 'routine precision,' as some have called it, has enormously improved the ability of airplanes to hit hard, buried targets. Specially designed ordnance has also seen tremendous advances. In World War II, the British developed the six-ton Tallboy bomb to use against special targets, including the concrete submarine pens of occupied France in which German U-boats hid. The Tallboys cracked some of the concrete but did not destroy any, in part because these were 'dumb bombs' lacking precision guidance, and in part because the art of hardening warheads was in its infancy. In the first Gulf War, the United States hastily developed a deep-penetrating, bunker-busting bomb, the GBU-28, which weighed 5,000 pounds, but only two were used, to uncertain effect. In the years since, however, the U.S. and Israeli air forces, among others, have acquired hardened warheads for 2,000-pound bombs such as the BLU-109 that can hit deeply buried targets—which is why, for example, the Israelis were able to kill a lot of Hezbollah's leadership in its supposedly secure bunkers. The aircraft that deliver bombs can affect the explosives' accuracy. Bombs that home in on the reflection of a laser, for example, could become 'stupid' if a cloud passes between plane and the target, or if the laser otherwise loses its lock on the target. Bombs relying on GPS coordinates can in theory be jammed. Airplanes being shot at are usually less effective bomb droppers than those that are not, because evasive maneuvers can prevent accurate delivery. The really complicated question is that of effects. Vietnam-era guided bombs, for example, could and did drop bridges in North Vietnam. In many cases, however, Vietnamese engineers countered by building 'underwater bridges' that allowed trucks to drive across a river while axle-deep in water. The effect was inconvenience, not interdiction. Conversely, in the first Gulf War, the U.S. and its allies spent a month pounding Iraqi forces dug in along the Kuwait border, chiefly with dumb bombs delivered by 'smart aircraft' such as the F-16. In theory, the accuracy of the bombing computer on the airplane would allow it to deliver unguided ordnance with accuracy comparable to that of a laser-guided bomb. In practice, ground fire and delivery from high altitudes often caused pilots to miss. When teams began looking at Iraqi tanks in the area overrun by U.S. forces, they found that many of the tanks were, in fact, undamaged. But that was only half of the story. Iraqi tank crews were so sufficiently terrified of American air power that they stayed some distance away from their tanks, and tanks immobilized and unmaintained for a month, or bounced around by near-misses, do not work terribly well. The functional and indirect effects of the bombing, in other words, were much greater than the disappointing physical effects. Many of the critiques of bombing neglect the importance of this phenomenon. The pounding of German cities and industry during World War II, for example, did not bring war production to a halt until the last months, but the indirect and functional effects were enormous. The diversion of German resources into air-defense and revenge weapons, and the destruction of the Luftwaffe's fighter force over the Third Reich, played a very great role in paving the way to Allied victory. At a microlevel, BDA can be perplexing. In 1991, for example, a bomb hole in an Iraqi hardened-aircraft shelter told analysts only so much. Did the bomb go through the multiple layers of concrete and rock fill, or did it 'J-hook'back upward and possibly fail to explode? Was there something in the shelter when it hit, and what damage did it do? Did the Iraqis perhaps move airplanes into penetrated shelters on the theory that lightning would not strike twice? All hard (though not entirely impossible) to judge without being on the ground. To the present moment: BDA takes a long time, so the leaked DIA memo of June 24 was based on preliminary and incomplete data. The study I headed was still working on BDA a year after the war ended. Results may be quicker now, but all kinds of information need to be integrated—imagery analysis, intercepted communications, measurement and signature intelligence (e.g., subsidence of earth above a collapsed structure), and of course human intelligence, among others. Any expert (and any journalist who bothered to consult one) would know that two days was a radically inadequate time frame in which to form a considered judgment. The DIA report was, from a practical point of view, worthless. An educated guess, however, would suggest that in fact the U.S. military's judgment that the Iranian nuclear problem had suffered severe damage was correct. The American bombing was the culmination of a 12-day campaign launched by the Israelis, which hit many nuclear facilities and assassinated at least 14 nuclear scientists. The real issue is not the single American strike so much as the cumulative effect against the entire nuclear ecosystem, including machining, testing, and design facilities. The platforms delivering the munitions in the American attack had ideal conditions in which to operate—there was no Iranian air force to come up and attack the B-2s that they may not even have detected, nor was there ground fire to speak of. The planes were the most sophisticated platforms of the most sophisticated air force in the world. The bombs themselves, particularly the 14 GBU-57s, were gigantic—at 15 tons more than double the size of Tallboys—with exquisite guidance and hardened penetrating warheads. The targets were all fully understood from more than a decade of close scrutiny by Israeli and American intelligence, and probably that of other Western countries as well. In the absence of full information, cumulative expert judgment also deserves some consideration—and external experts such as David Albright, the founder of the Institute for Science and International Security, have concluded that the damage was indeed massive and lasting. Israeli analysts, in and out of government, appear to agree. They are more likely to know, and more likely to be cautious in declaring success about what is, after all, an existential threat to their country. For that matter, the Iranian foreign minister concedes that 'serious damage' was done. One has to set aside the sycophantic braggadocio of Secretary of Defense Pete Hegseth, who seems to believe that one unopposed bombing raid is a military achievement on par with D-Day, or the exuberant use of the word obliteration by the president. A cooler, admittedly provisional judgment is that with all their faults, however, the president and his secretary of defense are likely a lot closer to the mark about what happened when the bombs fell than many of their hasty, and not always well-informed, critics. *Photo-illustration by Jonelle Afurong / The Atlantic. Source: Alberto Pizzoli / Sygma / Getty; MIKE NELSON / AFP / Getty; Greg Mathieson / Mai / Getty; Space Frontiers / Archive Photos / Hulton Archive / Getty; U.S. Department of Defense
The Hill
2 hours ago
- The Hill
Reforming Fannie and Freddie is just the first step
For nearly 17 years, Fannie Mae and Freddie Mac — two pillars of the U.S. housing finance system — have remained under federal conservatorship. The debate over how to exit this limbo has consumed housing policy circles for over a decade. Most stakeholders now agree that reform is overdue. But even the best plan to restructure these institutions will fall short if it ends there. Fannie and Freddie matter. The government-sponsored enterprises guarantee nearly half of all new U.S. mortgages, ensuring liquidity in both good times and bad. They are also among the few institutions with a public mission to serve rural, low-income and historically underserved borrowers. Reimagining them as regulated utilities — with capped returns, cost-based pricing and clear service obligations — would bring transparency and durability to a system long overdue for a modern framework. But structure alone won't solve the affordability crisis gripping communities nationwide. Even perfectly governed Government-Sponsored Enterprises cannot close the gap between surging home prices and stagnating wages. Nor can they single-handedly fix the uneven access to credit or the persistent racial homeownership gap. The median U.S. home now costs over $420,000. According to the National Low Income Housing Coalition, the nation faces a shortage of more than 7 million affordable rental homes. In many markets, even well-qualified buyers with stable incomes and decent credit are being priced out of the market. The gap between what families earn and what homes cost is no longer just wide — it's systemic. Without a broader effort, a restructured Fannie and Freddie would still be operating on top of a broken foundation. To truly modernize housing finance, we need to rethink how we underwrite risk, where we allow homes to be built, and who gets access to capital. A healthy system must go beyond liquidity. It must support housing production, economic inclusion and long-term market resilience. Here are three critical areas where policy must evolve: 1. Zoning and land use reform The Government-Sponsored Enterprises can't buy loans on homes that don't get built. In many cities, exclusionary zoning — such as minimum lot sizes, bans on multifamily units, and onerous parking requirements — chokes off the supply of new housing. While local governments control zoning, federal policy can provide powerful incentives. One approach is to link infrastructure or transportation grants to inclusive land-use reforms. Removing regulatory barriers to starter homes, townhouses and modular construction could unlock affordable housing supply without the need for new subsidies. 2. Credit Innovation for a changing workforce Today's credit models don't reflect how Americans live and work. Renters with flawless payment histories still struggle to build credit. Gig workers with steady earnings face outdated underwriting standards. Appraisals often undervalue modular and manufactured homes despite their key role in expanding affordability. Federal regulators should accelerate the development of alternative credit scoring models, expand underwriting pilots and recognize stable income sources beyond the traditional W-2. A modern credit system must reward reliability — not just conformity. 3. Equity through transparency The racial homeownership gap isn't closing on its own — it requires deliberate action. Any Government-Sponsored Enterprises reform must include strong data transparency on lending by race, income and geography. Public dashboards, equity benchmarks and stronger oversight should be part of the solution. If the Government-Sponsored Enterprises are to fulfill a public mission, their performance must be trackable, visible and grounded in outcomes — not aspirations. Fixing Fannie and Freddie is necessary — but it's not sufficient. These institutions are deeply ingrained in the core of America's housing and financial systems. Their influence extends from interest rates and loan terms to neighborhood stability and intergenerational wealth. Restructuring them without addressing the broader system would be a missed opportunity. Economists such as Mark Zandi of Moody's Analytics and Jim Parrott of the Urban Institute have long supported a hybrid model: one that combines strong regulation with market participation. They argue that it's possible to balance broad access to mortgage credit with taxpayer protection. Their work affirms that reform doesn't require a false choice between efficiency and equity. We can — and must — pursue both. Recent public friction between Bill Pulte, director of the Federal Housing Finance Agency, and Federal Reserve Chair Jerome Powell is another reminder: Housing finance doesn't operate in isolation. Interest rate policy, inflation and credit markets all interact with the institutions that support the mortgage system. Reform must be built to withstand not only market volatility but also political and monetary turbulence. Fannie Mae and Freddie Mac have helped millions of Americans buy homes and weather economic downturns. But they can't fix zoning laws, modernize credit scoring or close the racial wealth gap on their own. Suppose we want a system that works not just in recovery but in resilience. In that case, we need a long-term vision — one that aligns public purpose with private capital and innovation with accountability. The next chapter of housing finance must be bigger than balance sheets. It must reflect the realities of today's economy and prepare for the demands of tomorrow's homebuyers. This isn't just about fixing what's broken. It's about building a housing finance system that works — for everyone. Omar Mbowe, Ph.D., MBA, is the Managing Partner of Auxilia Capital Partners, a New York–based real estate investment firm. He also serves as the executive director of the HED Initiative.
