How the Tea Party's Like Herbalife

| Tue Oct. 19, 2010 6:00 AM EDT

Tea party leaders love to talk about how their grassroots movement is a revolutionary new way of doing politics from the bottom up, organized more like a regenerating starfish than a top-down bureaucracy. But what if the tea party isn't a star fish but more of a pyramid? At least one of the biggest tea party organizations in the country, Tea Party Patriots, bears a striking resemblance to companies like Herbalife that operate what some critics consider nothing more than legalized pyramid schemes. And that's not just because, as I report today, one of the group's top leaders was a top earner at Herbalife. Consider some of the parallels:

CONSTANT RECRUITING

Herbalife: Ninety percent of Herbalife’s low-level distributors quit within a year, requiring constant recruitment to keep the company afloat.

Tea Party: Lorie Medina, a recruiter for the Dallas tea party, recently told the National Journal: "What I see is, every three, four, five months about 10 to 20 percent of your active people trail off. Those numbers have to be replaced every few months. It's a continual grind to keep the numbers up." Dawn Wildman, a California based national Tea Party Patriots coordinator, said: "The message is important, but people are expendable."

LOW OVERHEAD

Herbalife: By using "independent distributors," Herbalife keeps its costs low and shifts overhead to the little people.

Tea Party: National Journal touts cheapness as one benefit of the tea party's "leaderless" structure: "The network never outgrows the infrastructure, because each tea party is self-reliant. And the groups make it their business to seed more groups, producing sometimes dizzying growth."

FONDNESS FOR SIGNS

Herbalife: Responsible for ubiquitous telephone pole signs offering work from home deals.

Tea Party: Tea Party Patriots recently launched a “One Million Yard Signs” project as part of a “branding” and recruiting effort.

MEGA RALLIES

Herbalife: Motivational rallies, complete with testimonials, are a staple. Company founder Mark Hughes (who died of a drug overdose in 2000), once told rally crowds selling Herbalife products would make the world a better place.

Tea Party: Rallies often seem to be the movement’s raison d'etre. They often feature testimonials from an activist claiming that before the tea party, she had been "just a mom" who didn't care about politics, but now, her life has been transformed through work to make the country a better place for her children and grandchildren.

PEOPLE AT THE BOTTOM GO BROKE

Herbalife: Class action lawsuit settled in 2004 for $6 million alleged that thousands of people who signed on as Herbalife “supervisors” lost anywhere between $10,000 and $50,000.

Tea Party: Pam Silleman, a single mom who founded the Napa Tea Party in California, says she has depleted savings and run up $100,000 in credit card bills getting local tea party off the ground.

PEOPLE AT THE TOP MAKE $

Herbalife: The average "president's team" member, a group that makes up less than one percent of Herbalife’s distributors, reportedly grosses about $600,000 a year.

Tea Party: Jenny Beth Martin, a national coordinator of Tea Party Patriots has said she now earns $6,000 a month. Co-coordinator Mark Meckler, the former member of Herbalife's "president's team," draws a salary, too, though won’t disclose the amount. (Conspiracy minded and disgruntled patriots suspect it is at least six figures, paid with donations vacuumed up from local groups whose organizers are going broke.)

THRIVING IN BAD ECONOMIC TIMES

Herbalife: While the stock market was in a serious slump and the country in a dire recession, Herbalife’s stock price has more than doubled as the unemployed turn to desperate money-making schemes.

Tea Party: Didn’t exist before February 2009. Tea Party Patriots, for its part, now claims 15 million members.

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