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Is the Tea Party Movement Like a Pyramid Scheme?

One of the movement’s leaders, Mark Meckler, was once a top operator in a company accused of conning consumers. Is he applying the same tactics to the tea party?

| Tue Oct. 19, 2010 5:00 AM EDT

Few of the tea party activists I spoke with for this story seemed to know what Meckler does for a living or about his work for Herbalife. (UniqueLeads.com owner Shai Pritz wouldn't comment on Meckler's work for his company, but Meckler still maintains a voicemail box there, and when I called his UniqueLeads office number in mid-October, a woman answered: "Mark Meckler's office.") Many have assumed that he was devoting all of his time to the tea party, largely because earlier this year he sent out an appeal to local tea partiers pleading poverty and asking for money.

Meckler's professional experience in the world of multilevel marketing seems to have translated quite well into the tea party movement.

The solicitation apparently raised some cash for the Mecklers, even while raising some eyebrows among local activists who, even without knowing about his MLM background, have begun raising red flags about what they see as Meckler's keen interest in the tea party movement's one real asset: its contact database. It's loaded with the names of highly politically engaged people who might be inclined to donate money to candidates—or, more cynically, people susceptible to conspiracy theories who might be interested in buying some overpriced gold, or perhaps a too-good-to-be-true weight-loss pill.

Meckler came under fire earlier this year when news broke that, in 2007, UniqueLeads had spun off another company called Opt-In Movement, in conjunction with a DC-based GOP consultant David All, to create a list-generation firm that catered to political campaigns. (All declined to comment, and the company appears to be inactive.) Tea party activists seized on the story as a sign that, far from being the grassroots activist Meckler claimed to be, he was actually an aspiring GOP consultant. Concerns over Meckler's intentions have also surrounded a $1 million anonymous donation recently received by the Patriots, which the group is divvying up via grants to its local affiliates. The grant criteria placed a high value on applications from groups that got a lot of members to register on the national TPP site, which meant turning over significant personal information.

Tensions over email harvesting and the lack of transparency in TPP's finances have been brewing under the surface of the movement for some time. But after the announcement of the grant criteria, Laura Boatright, a California tea party activist who has had a falling out with Meckler and TPP warned on her blog against providing contact info to the group: "The 'power/gravitas' of Tea Party Patriots is their ability to say that they 'represent' or 'have access to' 20 million 'contacts.' When it comes to campaigns, political parties, or issue causes (like California's initiative process, and/or petition drives) that large number gets them notice and access to people who would not otherwise pay Mark Meckler, [national coordinator] Jenny Beth Martin, or any other Board Members the time of day."

There's no evidence that TPP is selling its contact lists. But the Tea Party Patriots' own privacy policy indicates that it has the option. It says, "TPP may use Individual Information to advertise, directly or indirectly, to individuals using direct mail marketing or telemarketing using telephones and cell phones and such contact shall be deemed to be with the permission of individuals covered by this Privacy Policy." (Neither Meckler nor Martin returned repeated phone and email requests to explain the policy.)

Meanwhile, Meckler's professional experience in the world of multilevel marketing seems to have translated quite well into the tea party movement. The organizational structure of TPP, in fact, looks a lot like Herbalife's, with its heavy reliance on motivational rallies, weekly conference calls to keep people engaged, its widespread use of promotional lawn signs, and dependence on cheap, unpaid labor. And most importantly, its failure to produce measurable results other than the creation of the network itself. (See here for a list of comparisons between the tea party and Herbalife.)

While distinctly non-starfish-like organizations like Tea Party Express, which is run by a California GOP consulting firm and much maligned by Meckler for not being grassroots enough, have made a significant impact on elections in Delaware, Massachusetts, and Alaska, TPP has remained above the electoral fray. Though it formed a political action committee, and the midterm elections are quickly approaching, federal election records show that the PAC has never raised any money, nor has it endorsed any candidates. TPP is urging supporters to erect yard signs across the country to "brand" itself and will hold some get-out-the-vote rallies in the run up to the midterms. But its main claim to fame is really the size of its network, not anything the network has actually accomplished.

The parallels between the Tea Party Patriots and a multilevel marketing company don't surprise FitzPatrick, the pyramid scheme expert, who says that tea party rhetoric is similar to that of MLM companies. MLM operations and pyramid schemes, he says, "aren't just about money. They are about how you are part of an elite group of people who are enlightened." He says that in their recruiting, the top leaders of these types of companies often give a false narrative about eminent economic collapse, how Social Security won't be there to save you in old age, and how the government keeps the average guy from getting ahead. And when the companies draw scrutiny from regulators, they often invoke the same kind of language as the tea party about "jack-booted thugs" and oppressive regulation. The tea party and multilevel marketers, he says, are a perfect fit in many ways: "MLMs claim to represent freedom-lovers. They are an economic match to the Tea Party's political message."

Nonetheless, the Tea Party Patriots is "moving to the next level," as they say at Herbalife. In late September, its top organizers met with a secretive group of far-right movers and shakers to make a fundraising pitch for the group's multi-million-dollar "40-year-plan" to change the country. The group, the Council for National Policy, is funded heavily by the DeVos family, the owners of Amway, one of the largest MLM companies in the country. According to the TPP fundraising memo, the money would fund more rallies, to recruit more activists, to fund more rallies, to recruit more activists, to fund more rallies.

A condensed version of this story appears in the January/February 2011 issue of Mother Jones.

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