MLM and the Argumentum Ad Populum Fallacy

Today's blog post pertains to a common fallacy which uses popularity to determine efficacy. This tactic is commonly used as an emotional appeal instead of a logical deduction, and the idea is to obfuscate reality by suggesting a large group of people can't all be wrong. However, throughout history we have seen large groups of people are routinely wrong, and some examples involve, slave owners in the United States, Nazi's in Germany, Fascists in Italy, Islamic State in Syria and Libya, and many many others. I had previously written about the mob mentality, and how it can make people inherit certain behaviors they would deem unsavory, therefore it doesn't make sense that a large group would determine something to be authentic. If anything, a large group of people can spiral and become less good as it grows, take the government as an example. The idea that a large group of people can prove something to be legitimate is flawed, and yet this fallacy continues to be used by MLM apologists. 

One of the biggest issues with this logic is the subjectivity of determining when a group is big enough to be considered authentic. There aren't any parameters for this logic, therefore a large group to one person may be a small group to another person. The news is a great example of the inconsistency in labeling big groups and small groups. One example would be the Las Vegas shooting versus the Florida massacre. If someone were to judge these two by their identifying titles, then they would think the Florida massacre was considerably larger than the Las Vegas shooting. The actual numbers are quite different, and by a wide margin. The Florida massacre left seventeen dead and fourteen injured versus Vegas which left fifty-eight dead and eight-hundred fifty-one injured, according to Google. Yet, Vegas was labeled as a shooting and Florida was a massacre. Now, there was some clear bias as Florida involved children at a school, which is a much more emotional topic than a concert being attacked, but objectively the labels should have been reversed.

The context in which the group is being labeled is also extremely important for determining whether or not the group would be considered small or large. Going back to the Florida massacre example, a group of 17 people killed is a large number, considering a mass shooting is labeled as four or more people being killed. According to this fallacy, it would be fair to say every group of 17 people or more would be considered large, yet we know this to be untrue. If 17 senators voted against a bill, then we would consider that group to be very small and an overwhelming majority, 83 senators would make the bill pass. Therefore, simply focusing on a number cannot hold any weight, since context must be defined.

A final issue with this logic is, what happens when a big group runs into a bigger group? What I mean by this is, let's say there are approximately eighteen million MLMers in the world, according to qurora, in 2015. That would be considered a big group, except the population of the world was seven billion, meaning less than .3% of the world's population was involved in MLM. Does that now mean that MLM is not a big group? To take this a step farther, let's say people say MLM is legitimate because eighteen million people were participating. Can we then say MLM is not legitimate because seven billion people didn't?

The idea or qualifying a group as large, and therefore assuming they have an absolute truth, should be a red flag. There should be better qualifying characteristics than a number, and the person pitching the MLM should be giving those qualifications instead of this fallacy. The idea that a certain number of people couldn't be wrong is asinine, and it perpetuates a mentality of blind obedience.

Dr. Martin Luther King said, "I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin, but by the content of their character."
Here is my version of this quote as it relates to this article. I have a dream that people will judge a business opportunity based on its merits and not on fallacies and misinformation.

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Sources:

https://www.quora.com/How-many-MLM-network-marketing-distributors-are-there-in-the-U-S

https://www.cnn.com/2018/02/14/us/florida-high-school-shooting/index.html

https://en.wikipedia.org/wiki/2017_Las_Vegas_shooting

MLM and Webinars

Today's blog post was inspired by a recent comment about "webinars" and their peddlers. A "webinar" is a lecture held on an internet platform, and unlike seminars, which are usually held in forums or halls, "webinars" require very little to host. This means the barrier to entry for hosting a "webinar" is very low, and people do not need to prove the veracity of their claims. To clarify, the "webinars" I'm referring to aren't real webinars, but rather sales scams and "MLMs" disguised as educational videos. There are plenty of actual webinars hosted by accredited professors and other experts, and they have designed their teachings to spread authentic information. Also, there are seminars that are held by fiction peddlers, such as Kiyosaki's real-estate seminars, but the cost of these seminars is substantially higher than that of a webinar. The cost of hosting a seminar prohibits amateur charlatans from entry into the seminar scams, but the internet allows people to enter the "webinar" scam field. This means people need to be more critical than ever about the information they are receiving online.

The internet and its proliferation of information comes with great opportunities for people to learn and to be swindled. Facebook is particularly dangerous since they decide what content is good for each individual and what is not. Their algorithms are designed to show a person what they think that person wants to see, and this includes which news sources they deem relevant, as well as which advertisements are most likely to be appealing to the person and their needs. Unfortunately, Facebook doesn't care about the authenticity of these advertisements and the bad actors, which can result in charlatans being given access to an unprecedented number of people for a few dollars. This also lends credibility to the bad actor's claims since, according to Facebook, they are allegedly trying to crack down on "Fake news" and other phony advertising.

YouTube has also given people an unprecedented amount of access to information and scams. The ability to load content on YouTube, with virtually no expense, has allowed lots of bad actors to come out and create "webinars". This gets compounded by the fact that YouTube also has algorithms that tries to find similar content to other videos and works handily with other platforms, such as Facebook, to further target people with specific videos. The bad actors are keen to these algorithms and regularly manipulate their videos and titles to fool the algorithms into thinking their content is something it isn't.

An example of this may be, a mother looks for part-time work-from-home on Google. Google then tells YouTube (their subsidiary) this person specifically searched for this type of opportunity and YouTube populates their recommended videos with free MLM "webinars". The "webinar" addresses specific concerns the mother has and how they can fix those problems by paying for another "webinar". Then that "webinar" says the key to the hidden knowledge is in a different "webinar" and focuses on selling their most expensive "webinar". This ultimately leads to a lot of wasted time and money, since these "webinars" hosted by "gurus" don't actually have the answers the mother is seeking.

Some examples of these bad actors are, Tyson Zahner, Eric Worre, John C. Maxwell, Robert Kiyosaki, Tai Lopez, and Tony Robbins. Please make note the last two are not specifically connected to MLM, but they still pull the same nonsense. These "webinars" are not exclusive to MLM chicanery.

I want to really emphasize these "webinars" are scams, and the people that host these "webinars" are looking to enrich themselves by taking money from their consumers. If they had the answers they claim, then they wouldn't be wasting their time making "webinars", but rather would be spending their time doing the very things they claim makes them rich. As Mark Cuban says, "If a deal is a great deal, they aren't going to share it with you."

The most important way to avoid these schemes involves the same way in which we critically investigate large purchases. The more research people can do about a "webinar" with a "guru" before paying for their services, the better that person will be equipped to deal with the deception. These bad actors don't want people to look for information about them on the web, just like Jimmy Kimmel wants you to forget he made his career from exploiting women.

MLM and Marriage

Today's blog post is about MLM and its consistent abuse of boundaries, especially when it comes to marriage. MLM, unlike most other businesses, does not stray away from people's personal lives, but rather attempts to merge with it. MLM is often pitched as a "side income opportunity" with the potential to become "a retirement opportunity". It is supposed to be flexible and allow people to "grow" at their own pace. However, the more a prospect becomes involved with the "training", the more time and energy the "business" requires. Also, because of the unorthodox hours in which MLM holds its "meetings" and "seminars", it directly conflicts with the personal lives of the prospects and members. Ideally, in the MLM "business", a member would look for prospects during the day, then spend their evenings and weekends trying to convert potential recruits into members, and even if a member doesn't have new recruits, they are still supposed to attend every meeting.

Marriages become the target of MLM scrutiny, because marriages can directly interfere with the MLM "business". Assuming both partners are not engaged in the MLM, the MLM leaders will create scenarios in which both the marriage and the MLM "business" cannot survive in harmony. MLM leaders will force spouses to choose meetings over important events, such as weddings, birthdays, anniversaries, or anything else that may conflict with their agendas. MLM leaders show no remorse as they become more demanding of a prospect or member's time, and they will use a combination of "love-bombing" and passive-aggressive threats to make a spouse choose MLM over the other option. Eventually, the MLM will create a scenario, commonly referred to as an ultimatum, in which a spouse will have to choose between their marriage and the MLM "business". This is usually one of the final steps before complete indoctrination and the slow destruction of everything an MLM prospect or member had.

MLMs are also financially draining as they require a consistent monthly fee to continue to participate. Note, the FTC specifically says pay-to-play schemes are illegal, which is why MLMs have carefully disguised this fee as products, tools, services, meetings, seminars, and occasionally a membership. The MLMs require a minimum monthly purchase of some or all of these categories, or a MLM member may not continue to qualify for bonuses and their "businesses" could be dismantled assuming they have "downline" members. These categories can be expensive, and as many as 99% of MLM members may not generate enough revenue from their "businesses" to cover these monthly fees. This causes a tremendous strain on marriages as one of the two spouses could sink thousands of dollars into this "business" while forcing the other spouse to cover the losses, or worse, could force both spouses into debt and ruin their finances and credit. This process will continue until there is no money left or the MLM participant voluntarily leaves.

MLM and marriage is a particularly special topic because it effects one of our most sacred pillars of society. There are very few relatable subjects across all borders, but marriage is something everyone can relate to and understand. This is why MLMs, being responsible for the destruction of relationships and marriage, continues to be written about regularly.

The first blog I ever read, "Married to an Ambot", is designed around the misery of being committed to a person that chooses "Amway" over their marriage. Luckily, they have a happy ending. "Joe Cool", the author of "Amway - The Dream or the Scheme?", was engaged when he was in "Amway", and he too walked away from the "business" after they challenged him to choose between the two.  I also was presented with the ultimatum from an "Amway" Emerald, and he told me, "The business works better when you are with someone that is also in the business, you may want to reconsider your relationship", I chose my relationship. Even though these three examples all reflect good decision making, they should not be treated as a regular outcome, and even though these three examples are about "Amway" (because apparently the "American Way" is to promote separation and divorce), there can be examples found across all MLMs.

Here are some tips to help prevent MLM from destroying your relationship or marriage:

1. Listen to your spouse. This person agreed, usually in front of a large group, to be there for you no matter what. Ask why they think MLM is the answer, and then suggest an alternative in a positive or uplifting fashion. Do not ridicule them, they aren't your puppy.

2. Treat your spouse kindly. Usually, MLM is appealing because the spouse is receiving "love-bombing". You can provide this as well, in a constructive way, and then encourage your spouse to do more research about the "business".

3. Have your spouse talk to someone with business acumen about the "opportunity". This won't be effective unless the spouse is actually willing to listen, and could backfire if they are already indoctrinated. They have to be ready to listen to what a business person has to say, and not be defensive with their programmed rebuttals.

4. Do not send an ultimatum. Ultimatums almost never have the anticipated result, and usually cause the person to vehemently reject your option. Nobody wants to be forced into a corner, especially someone that thinks they are doing what is best for the family.

5. Remove your spouse from the routine. Often, people find themselves in a rut, and life just seems strangely more difficult and frustrating. Take some time away from everything, then come back and approach the situation with a clear head and fresh eyes. You will be amazed at how much less dreary things seem you step away for a short period.

MLM and Appeal to Consequences Fallacy

Today's blog post is about a frequently used piece of rhetoric by MLMers, "If MLM is illegal, then why hasn't it been shut down?". This line falls under the category of the appeal to consequences fallacy, which suggests something must be legitimate if it hasn't been abolished. This type of logic assumes an undefined conclusion is causation for the current state in which something operates, which can be true, but usually needs to be supported by other conditions. In other words, this type of logic can only be used as support for a position and not as definitive proof.

An example of the failure in this logic would be the case of Bernie Madoff. He operated an illegal Ponzi scheme for decades, but by this logic, it was deemed legitimate until he was shut down. This is problematic, because the fallacy suggests his "business" was not a problem until law enforcement got involved, which is inherently untrue as things don't transform from legitimate to illegitimate because of a lawsuit. A lawsuit is designed as a means to determine if the "business" has been legitimate or not, and then passes a judgment based on the findings.

MLMs have regularly been in the crosshairs of the FTC, and many have been successfully shut down. This presents a second issue with the logic, because MLMs that have had legal action brought against them, have had some sort of consequence from each judgment. A recent example is "Herbalife", which was investigated by the FTC and had to settle the case by paying a $200 million dollar fine. The idea that a company would be legitimate, and have to pay a substantial fine to victims, creates a problematic situation for this logic. If "Herbalife" had been operating legitimately, then the case would not have produced this type of result, and "Herbalife" would have continued to operate the same way. However, "Herbalife" was found to have significant issues within the compensation plan and was forced to restructure in the United States.

Here is what former FTC chair, Edith Ramirez, had to say about Herbalife:

“This settlement will require Herbalife to fundamentally restructure its business so that participants are rewarded for what they sell, not how many people they recruit,” FTC Chairwoman Ramirez said. “Herbalife is going to have to start operating legitimately, making only truthful claims about how much money its members are likely to make, and it will have to compensate consumers for the losses they have suffered as a result of what we charge are unfair and deceptive practices.”

Some of the other MLMs that have been shut down are, "Burnlounge", "WakeUpNow", "Fortune Hi-Tech Marketing", "Monavie", "Five Star Auto Club", "ZeekRewards", and many many more.

The idea that a particular MLM is operating legitimately, specifically because it hasn't been shut down, is more about luck, and less about operating within the guidelines of the law. Unfortunately, the FTC has yet to make a case against all "businesses" operating as MLMs, but that isn't to say it won't happen in the future. As of now, any MLM that has had litigation brought against them, has either settled or been shut down.

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Sources: 
https://www.ftc.gov/news-events/press-releases/2016/07/herbalife-will-restructure-its-multi-level-marketing-operations

https://onlinemlmcommunity.com/list-of-defunct-shut-down-and-out-of-business-mlm-companies/

MLM and Product Psychology

Today's blog post is about the excitement MLMers exhibit when it comes to their products. It is important to note, most MLM products are not unique, do not have any quantifiable research to support their claims, and can be found in retail outlets for a fraction of the price. Yet, MLMers treat their products as revolutionary and their enthusiasm can be comparable to the first iPhone launch. Some of the most common MLM products include, vitamins and supplements, makeup, water filtration units, dietary shakes, vacation packages, car assistance packages, cryptocurrencies, and life insurance. The two most important parts about MLM products, and why they choose these particular areas of the marketplace are, they are unregulated markets and they are highly subjective. MLMs choose to focus on these two markets because their rules are the most vague, and they can say unusually non-credible statements without getting into the same amount of trouble as others.

This leads to MLM's number one problem, getting people to care about their product or service. MLMers use psychological techniques to enhance excitement about their product or service, and the techniques fall into two main categories: individual and group. It is important that they use both styles of techniques, because we are biologically wired to be recognized as an individual and be part of a bigger group. Also by using the following techniques, it significantly disarms consumers from making rational decisions. Some individual techniques MLMers use are, smiles, light contact (hand shakes, hugs, shoulder touching), story sharing, and attentiveness. This helps feed into a consumer's ego and makes them feel important.  Some of the group techniques MLMers use are, forming "team" meetings at houses, and holding conferences at churches and stadiums. By showing people that they aren't alone, and by introducing high-levels of enthusiasm at meetings (large levels of applause for speakers, music, lights), it creates confidence that the "business opportunity" is real. Note, these techniques have nothing to do with learning about a "business opportunity" and are predominately used to sell something. These techniques do not make a person authentic and are often used as a means to an end.

MLMers create a false euphoria around their products and services, because they know very few people want the "opportunity" to go to family, friends, and strangers about soap, water filtration systems, dietary shakes, and makeup. By transforming the "J-O-B" into a dream making, unlimited potential, independent, "opportunity", it makes an extremely undesirable MLM into the choice of a lifetime. 

MLM and Echo Chambers

Today's blog post is about the echo chambers in MLMs and how they fuel the core principles and beliefs held by fanatical MLMers. These echo chambers are designed to reinforce thought-stopping jargon created by MLM leaders for the sole purpose of retaining membership. Echo chambers strive to silence dissenting opinions while creating a euphoria for their "businesses". Echo chambers are one of the strongest foundations of MLM, and they continue to perpetuate cognitive dissonance for the MLM members. This cognitive dissonance refers to the inability to reconcile the damage people are doing to themselves and others under the guise of helping others to achieve wealth and happiness.

Echo chambers can be regularly found in a multitude of categories. In recent news, James Damore, a former Google senior software engineer, wrote about the ideological echo chamber created in the Google work environment involving the sexes. We have echo chambers at American universities, in which opposing viewpoints to the left's agenda have been met with protests and violence. We have echo chambers in the American main stream media, in which certain media outlets choose to report on the issues they feel are important. And most importantly, with the proliferation of the internet, we have created our own echo chambers and surrounded ourselves with the information we want supported by the people we like. We have created a world which has become polarized, and we have strayed very far from the original principles of healthy dialogue.

These echo chambers impede progress and the ability to think freely. It is important to listen to people with opposing viewpoints, understand why they have those viewpoints, and then proceed to engage in dialogue. If a person cannot remove themselves from their echo chamber, then they can become victims of control. The development of this control over our thoughts and feelings is seamless and can happen very quickly. The echo chamber allows a person or group to dictate all information their followers receive, and can create a potentially damaging situation without the followers realizing they are being controlled. This also creates an inherent laziness to try and understand why a person is giving certain information, which gives more power to the leaders because the followers will not question anything.

Echo chambers are MLM leader's most powerful weapons. By creating an environment in which unquestioning obedience is mandatory, they can say and do anything without consequence. I previously attended a MLM seminar, called "Freedom Enterprise Days", in which only MLM members and recruits were allowed, and each MLM leader came out on stage with the same message. This seminar did not have a question and answer portion and the MLM leaders did not engage with the potential recruits. Instead, they showed a video that was carefully choreographed, followed by a story or monologue, and ended with thunderous applause. Each leader that approached the stage had nearly identical formulas, and they repeated this process for two and a half days. There was no ability to fact check their statistics, there was no proof their stories were truthful or relevant, and yet people listened to them with undying faith. This lack of skepticism is extremely dangerous, and it costs people billions of dollars annually.

Arguably the greatest gifts people have are free will and free thought, yet people instinctively give up these gifts regularly in the pursuit of satisfying their needs. Confidence people understand how to control others by taking the former assets away. They offer love, security, answers, and anything else a person may need due to vulnerability. It is up to each individual to be accountable for their actions. The ability to ask why, as Socrates did, is our greatest weapon to protect ourselves from intellectual predators.

MLM and The Emotional Thermometer

Today's blog post is about the separation of emotions from business. Too often, people utilize emotions to make important decisions, and business is one of the worst areas in which this occurs. Business should involve a calm and collected mind, but MLM is different as they tend to focus on the high-energy and fast-paced illogical hard-sell. MLMs specifically focus on the emotions and irrational side of the brain, because the numbers are particularly horrific. In a cursory Google search, one can find income disclosure sheets for a number of MLMs, and they show MLMs have extremely high failure rates and below minimum wage earnings across the vast majority of their population. Therefore, it is important for MLMs to go out of their way to distract from, or ignore these numbers, if they intend to continue to grow.

Emotions can be synonymous with temperature, hence the term emotional thermometer. It is important to regularly check our emotions, and analyze why certain situations evoke a larger or more intense emotional response than others. For example, if there is a particular situation in which I get angry, then I often reflect on that experience and try to understand why I got so "hot headed". This is important because the higher the emotional level, the less likely rational thought will be implemented. It is important to have emotions but they must be balanced. Any emotional extreme can lead to poor decision making, and ultimately can cause a lot of harm.

MLMs utilize psychological techniques to make people as emotional and non-rational as possible. They hold seminars, sometimes as long as an entire weekend, designed to eliminate critical thought by means of high-intensity content. Instead of pitching the "opportunity" as accurately as possible, they utilize "love-bombing", music, lights, anecdotal commentary, and dreams. These mechanisms are designed to obfuscate reality and invert the damning statistics. They do nothing to prepare a potential prospect with training, and they do not reveal the costs of the "business" until a person has been primed by hours of meaningless content. Their ultimate goal is to get a person as "pumped" as possible, because the higher the "pump" the less likely people are to question the motives and information.

Again, if MLMs were as accurate and direct as possible then they would fail, which is why they spend tons of money holding "seminars", "meetings", "trainings", and other unnecessary "functions" to subvert a person's critical faculties. They want someone's emotional thermometer to be as high as possible, because that will lead to a person's inability to dissociate fantasy from reality. Salespersons often focus on building relationships over the quality or content of their goods and services, because that can be more effective when closing the sale. It is important to remember this, because the "opportunity" is actually a big hard-sell to get a prospect to spend their hard earned dollars (or other currency) on the MLM.

One of my favorite expressions is: "If you're playing a poker game and you look around the table and and can't tell who the sucker is, it's you." (Paul Newman) The same can be said for MLM. If you can't tell why the MLMers care about you so much, especially compared to the way an average person treats you, then you are the perfect sucker they target.