Category Archives: Scientology

Work in Progress: Predictions for Scientology in 2014

This is a photo of a capitalist using rigorous analytical techniques to develop a highly likely future scenario for some investment-related event.

This is a photo of a capitalist using rigorous analytical techniques to develop a highly likely future scenario for an important investment-related event.

It’s getting close to the end of the year, a time that unleashes a flurry of “year in review” posts. But given our focus on research, which ultimately is about trying to predict some part of the future, it’s time to think about what might happen in the wacky world of Scientology in 2014.

In this post, I’m setting out a couple of key predictions for what I believe will happen to Scientology next year, and I’m asking for your help in coming up with a combined list of about ten things that we, collectively, believe will happen.  If we do this right, then I can publish an “official” predictions document that summarizes our thought process.  It’ll be fun to circle back a year hence to see how we did.

The Goal

Ultimately, we should be able to come up with about ten predictions for what will happen in the world of Scientology over the next year. Each prediction should be concrete enough that it’s easy to see if it came true a year from now. No fair couching a prediction in the vague generalities of an astrologer. As the Scientologists say when ridding themselves of body thetans hooked up to the e-meter on solo NOTs, “exact time, place, form and event.”

Predictions shouldn’t be too safe (i.e., predicting that David Miscavige will not be deposed by a cabal of disloyal underlings in 2014 is only fractionally more risky than predicting sunrise in the east every morning).  Predicting that the cult will gain no incremental new members via the Golden Age of Tech 2 release is approximately as safe.

At the same time, predictions shouldn’t be so over-the-top that they’re unlikely to happen.  Thus, I’m not predicting that a red-headed chain-smoking 26-year-old is going to walk into a Scientology facility and will be accepted as the reincarnation of L. Ron Hubbard.  

The ultimate "Deus ex machina" gimmick in Monty Python's Life of Brian.  Brian plummets from the tower, and seconds from certain death, he is rescued by an alien spaceship that just happens to be flying by.
The ultimate theatrical “Deus ex machina” gimmick takes place in Monty Python’s Life of Brian. Brian plummets from the tower, and seconds from certain death, he is rescued by an alien spaceship that just happens to be flying by.

Finally, predictions should be reasonable extrapolations from credibly anticipated events. There’s no need to try to guess what will happen from an unpredictable event.  In other words, we don’t need to worry about any deus ex machina scenarios.  Anything that depends on David Miscavige having a heart attack at his desk is not useful.

Importantly, predictions should be all about what we think will happen. Part of the challenge of the exercise is being able to distinguish what is likely to happen from what we wish would happen. So while I think 2014 will show an even greater rate of decline for the cult versus the increasingly evident decline seen in 2013, it is important to note that the cult will almost certainly be in business in something recognizably close to its current form, even though that’s not the outcome I desire.

The completed set of predictions should touch on each of the major operational aspects of the cult, which should include: finances, management, Ideal Org strategy, member retention, staff retention, celebrities, etc.  

If we look back in 365 days and we got all ten predictions exactly right, we were probably being too safe in what we expected. Similarly, if we only got two right, we were probably living a little too much in hope and desire and not enough in logic and reason.

My Current Best Guess

1.  The event business collapse will be complete in 2014.

Sometimes, the key to making a useful prediction is a certain degree of self-reflection.  Not a strong suit of Scientology management, however.

Sometimes, the key to making a useful prediction is a certain degree of self-reflection. Not a strong suit of Scientology management, however.

As you may recall, there were several big annual events cancelled in 2013. In the spring, the “Maiden Voyage” event, a briefing for big donors and higher-level OT’s aboard the Freewinds, was initially rescheduled for LA, but then dropped entirely. Though it wasn’t widely commented on at the time, this was clearly a harbinger of things to come, with the October event announced and then cancelled when the tent imported from the UK became a particularly rich vein of humor material to mine.  And of course, the ineptitude around the cult’s handling of the big November events in Clearwater (GAT2 unveiling and the IAS event) made it abundantly clear that there’s big trouble in the events business, an important and generally well-run part of the business previously.

In particular, I believe we’ll see the following all of the key details:

  • All big events, if not cancelled, will be below 1,000 people total (excluding seat-fillers from the Sea Org or even extras from outside, as may have happened at the Super Power dedication).
  • It is possible that by the end of 2014, the only event actually held will be the IAS gala.  Gone will be the Birthday Event, the New Year’s Eve event, Maiden Voyage and all the rest.
  • Due to the actions of all those loathsome SP’s spying on these ultra-ecclesiastical events, particularly Mike Rinder & Mike Bennitt with their “Apostate Air Force,” David Miscavige will never again hold another open-air event, including either major events or Ideal Org dedications.
  • The cult will not be able to make up revenue shortfalls from lower donations at these events and we will begin to see signs of financial pressure manifesting throughout the organization.  I don’t yet have a clear picture of exactly how these financial pressures will show up, and I don’t believe the cult will start digging into reserves, but the total revenue for 2014 will be the lowest in at least 20 years.

I’m going to go out on a limb here and say that this is the most significant development of 2013 and 2014. I think the events business is responsible for about 30% of cult revenue, or somewhere between $50 million and $75 million per year, and it’s the most profitable business around, generating about 80% gross margin.  If this business implodes suddenly, it’s going to push the cult close to operating losses for the first time in ages, and that, if it happens, is likely to unleash all sorts of craziness.

2.  The Ideal Org strategy will come to a grinding halt

Scientology's Ideal Org building in Gateshead, UK (in the Northeast, near the Scottish border).  The reality looks a little different from the photo they use for fundraising.  Thanks to Izhar at Idleorgs.com.

Scientology’s Ideal Org building in Gateshead, UK (in the Northeast, near the Scottish border). The reality looks a little different from the photo they use for fundraising. Thanks to Izhar at Idleorgs.com.

Clearly, the Ideal Org strategy visibly struggled in 2013 after working for a long time.  Working, of course, means that it was achieving its real goals of fleecing large chunks of money from large donors; it doesn’t appear to be about actually getting more people in the door, so I don’t count it a failure on that front because it was never really intended to succeed there.  I believe 2014 will reveal that the Ideal Org program is completely stalled.

And if the cult sells existing properties that it is unable to renovate, it will reveal a reality that is even worse: selling properties is a clear indication that the cult has started to operate in the red and is worried about starting to deplete reserves.

The original idea was fairly clever: get donors to contribute to buildings, with each campaign raising far more than the cost of the actual building. Miscavige pockets the difference and takes title to the building so the local donors have no real equity in what they just donated for (unlike churches in most Protestant denominations, for instance, where ownership of the building is retained locally).  The second phase of the scam is to exploit the local public’s “sunk cost bias,” getting them to dig even deeper into their pockets to fund renovations for the building that now sits empty and decaying.

  • Details will emerge of significant problems in keeping some of the key existing Ideal Org buildings open for business, making it harder than ever for Miscavige to try to show “straight up and vertical expansion.”
  • At most two Ideal Orgs will open in 2014, though the cult has published a target list of several dozen future locations that it claimed would open in 2012 and 2013, and it is woefully behind in the schedule.  The “under the radar” crowd will probably begin to notice the disparity between the promise and the results, while the Kool-Aid drinkers probably won’t.
  • The Valley Org (in the San Fernando Valley of LA) will be no closer to going Ideal than it is now, a major embarrassment given the richest concentration of Scientologists in the world living in its coverage area. We will begin to see evidence that this is a factor in the departure of several long-time LA Scientologists, and thus will conclude that it is going to help many “under the radar” LA public to decide to leave.
  • The cult will sell at least three buildings purchased for Ideal Orgs where it was unable to raise money for restorations.  Locations will probably be drawn from a list that includes New Haven, Chicago, Detroit, Philadelphia (DM’s hometown), Battle Creek, and a couple of UK locations.  If no new building campaigns for these locations are immediately announced, then we will be able to surmise for the first time that the cult is feeling pinched for cash and may actually be seeing losses from operations for the first time in decades, if ever. 
  • Several additional sites where renovations have not yet begun will be condemned or otherwise targeted by local governments seeking to rid their cities of the eyesores of decaying buildings.

3.  The retreat from the larger world will accelerate

I expect Scientology to move from shyness to a full-blown case of organizational agoraphobia in 2014.

I expect Scientology to move from shyness to a full-blown case of organizational agoraphobia in 2014.

We saw the beginning of what some might call “institutional agoraphobia” from the cult in 2013, as Miscavige moved the IAS event from Saint Hill to Clearwater.  There are two likely contributing factors driving this.

First, the European Scientology business is probably declining in the wake of institutional pressure such as that exerted by the German government and the effects of ridicule from the tabloid press, as the cult frequently endures in the UK.  There aren’t any particularly good numbers to show growth trends in Europe overall, so it’s hard to determine what’s actually happening here.  In this circumstance, poor business in Europe is driving the retreat from the continent.

Second, Miscavige’s obsession with security and with avoiding ridicule may have taken a body blow in 2012, when a tabloid reporter was easily able to gain access to the annual IAS event despite heavy security, and wrote a long feature story.  If European business was good, or even if it was merely flat, then moving the IAS event to increase security will probably cause the European business to decline at a faster rate, as European whales are probably less likely to want to journey to Flag for all their events.  In other words, in this scenario, Miscavige is preventably accelerating the decline of the European business to cater to his own fears.

Whatever the cause, the cult seems to implicitly acknowledge that the retreat from Europe is permanent, else they probably would not have paid to move the large semi-rigid tent used for IAS events at Saint Hill to Clearwater.  If the large event business in the UK were still intact, they would most likely have just gone ahead and purchased a second tent.  Otherwise, in a couple years, the cost of moving the tent back and forth across the Atlantic would quickly outweigh the cost of a second structure.

As if a major decline in the cult’s second biggest market wasn’t enough, smaller and more remote geographies appear to be breaking away from the cult. The defection en masse of the former mission in Haifa, Israel may be only the beginning.  In October, Miscavige declared 18 long-established Scientologists from South Africa, including some with decades of time in the cult and some who have donated millions of dollars for buildings and other campaigns.  This North Korea-style purge appears to have been about bringing management of the Johannesburg org under tighter control. However, it appears likely to backfire, given that the South Africans have been used to operating on a relatively long leash, and the increasingly important BackInComm blog suggests that a significant portion of the membership is rallying around those who have been declared, refusing to cooperate with the management team sent in from Flag.  The lesson here is that disconnection in small, remote locations is unlikely to have much sway since the relatively small numbers of public in smaller countries all know each other and can easily choose to stay together and defy the Mother Church.

In a thought-provoking article posted on ESMB about five years ago, J. Swift came up with an interesting scenario where Miscavige proactively fires the cult members with low donation potential and keeps only the high-end donors, moving to a “monastery Scientology,” where services are available only at Flag and one or two other global locations.  It’s an interesting scenario, but I don’t think the retreat from non-US locations is part of a proactive strategy; I think Miscavige is wholly reactive in how he deals with crises.

The cannibalization of business from orgs to Flag will only increase, affecting not only missions (which are on life support) but also Class V orgs (local Ideal Orgs) as well as advanced orgs (AOSH, AOLA, ASHO, etc). One side effect of the move to centralize higher-level services at Flag is the fact that many non-US public will find it very difficult or undesirable to travel to the US for services.  In particular, this is likely to affect areas that have previously been bright spots in the number of “bodies in shop,” like Eastern Europe, Russia, Taiwan and South America.  As a result, we can only conclude that centralization of services at Flag implicitly acknowledges that the cult is “done” outside North America.

  • The South African organization will “go indie.”  This doesn’t seem like a particularly bold prediction, given the visibility into the thought process of many of the prominent members of that community shown on their increasingly important “Back in Comm” blog.
  • We will get credible data showing that the staff at Saint Hill in the UK is down to only about 300 people, significantly below the level of even three or four years ago, and suggesting a near collapse of the higher level services business in Europe.  This collapse of the ability to serve high-end customers within Europe will further alienate public from the richer western European countries, reducing membership still further.
  • Russian Scientology will come under even greater pressure from an increasingly anti-Western Russian government.  During 2014, there will be increasing attention in the Russian press paid to this organization that, to the average Russian, has ties to the US intelligence community (an instance where Hubbard’s lies about his background in WWII military intelligence will actively hurt the cult).  This will likely lead to a damming of the flow of Russian Sea Org recruits, even though a high percentage of Russians want to emigrate to the West.
  • We will see Scientology abandon at least two countries due to lack of interest, including one in South America.  Ideal Org campaigns outside the US will get even less traction than domestic Ideal Org campaigns.

4.  “Under the radar” members are revealed to be the majority of US public

I believe we'll find out that most of the US membership is flying "under the radar," pretending to go along with the cult's directives while merely attempting to avoid disconnection's impact on their families, friends and businesses.

I believe we’ll find out that most of the US membership is flying “under the radar,” pretending to go along with the cult’s directives while merely attempting to avoid disconnection’s impact on their families, friends and businesses.

In the US, the percentage of “under the radar” members will be revealed to be significantly more than we had previously estimated.  Out of the perhaps 11,000 active “public” in the US, we will realize by the end of 2014 that substantially less than half are “true believers.” Most are just pretending to go along with the show to avoid disconnection.

I have spoken with a number of “under the radar” members who, as time goes on, are far less careful to hide their status from the cult.  Scientology seems to be more accepting of “under the radar” members than ever before, because it has basically no alternative other than to let them go and declare them. This acceptance of “under the radar” members may reflect optimism among top management that the recent Golden Age of Tech 2 release may be enough to cause people to come flooding back in the doors, but most under the radar public we’ve talked to are fairly skeptical of the changes in GAT2, and seem unlikely to get more involved.

5.  Disconnection loses its effectiveness

DisconnectionSpeaking of disconnection, I believe that 2014 will be the year where the membership shrinks enough that the threat of disconnection is much less important than before.

  • Defections of lower-ranks celebrities or rich whales will show that the power of disconnection to keep people in the cult is diminishing in its influence.  In other words, the ability of Leah Remini to boost her entire family out of the cult en masse will not be an isolated event.  Once there’s a track record of multiple people able to do this, disconnection will be done.
  • There are already informal “underground railroad” networks helping people to leave the cult and to get new jobs and to rebuild their lives. I predict that in 2014, these networks will become more formalized and better known to people still in the cult, making it much easier for staff at local orgs and at Pac Base and Flag to exit the cult.
  • Staff shortages will make it more difficult for the OSA to patrol the Internet, identifying disloyalty in Facebook posts and otherwise harassing those who speak up.  Similarly, social media will make it easy for the newly declared to get back in touch with those who had previously left, enabling them to get their new lives back on track much faster.

I believe this scenario to be true, but as a “never-in,” I don’t have the experience with the process of leaving the cult to be able to detail exactly how disconnection will diminish in its power.

6.  The legal losing streak will continue intact

The string of legal losses in 2012 and 2013 will continue, and I expect more suits with potentially serious economic consequences opening new battle fronts to be filed.

The string of legal losses in 2012 and 2013 will continue, and I expect more suits with potentially serious economic consequences opening new battle fronts to be filed.

Scientology will continue to lose every legal case it’s involved in.  And it seems likely that litigation will continue to build.  I expect that 2014 will bring more suits from rank-and-file public, perhaps to the exclusion of “flagship” suits like the Debbie Cook case or the Monique Rathbun case. While less fascinating to watch than the

  • Despite the possibility it may win individual battles (e.g., the “diversity jurisdiction” issue in the Garcia case), the cult will lose almost every case…
  • … but only after inflicting on itself the maximum possible damage. Given Miscavige’s penchant for micro-managing his attorneys, and given his inability to take the long view in working on his cases, DM will continue to be the cult’s biggest impediment to winning in the courtroom.  In particular, Miscavige seems to be unable to resist procedural maneuvers like moving for disqualification of opposing counsel that are normally only used in extraordinary circumstances; over time, as the cult’s reputation for this sort of theatrics becomes known, these tricks will work against them.
  • Look for a greater number of individual cases, particularly relating to refunds of monies on deposit, to be filed and to make significant progress through the courts.  I expect to see in late 2014 or early 2015, a wave of fraud suits similar to the Garcia case, where the cult is alleged to have made specific misrepresentation about the use of funds raised.
  • Particularly if the Garcias are able to establish that Scientology’s arbitration procedure is unconscionable, I expect to see a wave of refund lawsuits, many filed by networks of cooperating lawyers, much as coal industry black lung lawsuits were filed by an industry of lawyers working together.  I would expect to see a class action lawsuit filed in early 2015 for refunds of money on account.  If this is filed, I think it will be a watershed for the cult, because it puts a sizable chunk of reserves in play. Once the class action trial bar realizes just how much money has been paid on deposit, they’ll go nuts vying for a shot at suing the cult.

Where I need help

I can’t do a first-class list of predictions on my own.  I need your help to make this work.  I would appreciate your help on:

  • Looking for errors or omissions in the list above.  If I have forgotten to consider some factor in my analysis, please let me know.
  • If you think I have over-estimated or underestimated the importance of something that drives any of my scenarios, I would be grateful for a detailed discussion.
  • I need you to help fill this list out with scenarios or areas that I haven’t even considered.

Here are some particular areas where I am currently struggling, and I don’t have a clear answer.  Start here and add anything else you think is important.

What happens to Narconon?

On the one hand, there are record numbers of lawsuits outstanding against the bogus drug addiction treatment organization, and the cult will probably lose many of those.  Insurance fraud could well pop up at more Narconon operations than just at Narconon Georgia, as happened so spectacularly in 2013.  Another encouraging sign of the decline of Narconon is the increasing prominence of critical material at the top of Google searches.

However, it seems likely that the cult’s response to the increase in critical information will be to change the names of facilities and otherwise try to morph into something else, as we’ve already seen with Per Wickstrom’s operations in Michigan.  They may simply lie about the details of their programs so that they can’t be linked easily to Scientology by using the word “students” for patients, etc.  As a result, they’ll become a bit more difficult to attack, since there won’t be one single

What happens in Russia?

Russia is perhaps the biggest question mark in the attempt to measure overall Scientology membership.  The cult claims that there are over 20 missions and orgs throughout the country, but it’s entirely possible that these claims are bogus.  If true, it’s possible that there could be as many as 1,500 or 2,000 public in Russia, which makes the country able to supply many Sea Org recruits to work at Flag and other US locations.  Certainly to a bright kid trapped in a second-tier Russian city with poor job prospects, a ticket to the West, even for a job paying Sea Org wages could easily seem attractive.  And even though the per capita economic potential of each individual Russian cultie isn’t that high, a larger-than-expected number of cult members in Russia could affect the total number of members worldwide that we’re attempting to develop.

If there are any Russian speakers out there (DodoTheLaser, are you listening?) who could help monitor the Russian-language press for Scientology news, that would be very helpful.

Will staffing levels become an issue?

The cult seems to have survived for quite a while without any real ability to attract new members.  Obviously, that’s because of the cult’s well-established ability to keep hitting up existing members for donations.  So nearly twenty years after the massive “stat crash” in the early 1990s, when the stream of “fresh meat” dried up, the cult still limps along. (I believe revenue is down from the peak reached in that area, but there’s still enough money coming in for the cult to remain dangerous.)

It’s clear that a cult collapse scenario based mainly around the lack of new members probably won’t happen.  But relatively few comments in the two and a half years I’ve been following Scientology have attempted to grapple with the potential for the lack of staff to bring the cult down.

It’s long been known that many missions are struggling, open only a handful of hours per week at odd hours.  They’re struggling in part because of neglect from the top of the organization, but also from the competition from nearby Ideal Orgs cannibalizing members wherever possible.  It’s also quite apparent that some orgs are woefully understaffed.  A 40,000 foot office building would normally hold 150-250 employees depending on configuration.  But there are reports of visits to Ideal Orgs where only about a dozen staff are visible at any one time.

This leads me to believe that staff are dwindling, particularly in the outer orgs, though I believe the cult is also having trouble getting Sea Org staff as well, even with non-US recruitment efforts.

At what point does the staff shortage become a key defining issue in the decline of the cult?  If current members come into their local org during published business hours and there aren’t enough people to open the doors, that will certainly shake their reality on the “straight up and vertical” expansion theme.

Will the cult be able to explain the org stuff away by simply demanding that people come to Flag or AOLA or some other higher-level org for even the most basic services?

 

An Offer You Just Can’t Refuse

Columbus, OhioAn enterprising tipster passed on this e-mail invitation, which broke records in all sorts of ways for the lamest e-mail from the cult in a while. It even surpasses the single-question e-mail I highlighted a while ago that promised oodles of miracles in two short sentences, but this one does fall woefully short in the area of grandiose promises.

As short as the e-mail is, the analytical conclusion at the end suggests that something so brief can actually be quite revealing about how things are going inside the cult at the moment.

The Smoking Gun

Here is the e-mail received by my tipster, in its entirety.

From: "Stan Booth" <sbooth@asho.org>
Date: Dec 7, 2013 11:43 AM
Subject: Hi from Stan ASHO
To: <An enterprising tipster>

HI <Enterprising Tipster>,

Do you come by the Columbus org much? I am setting up a
Christmas banquet that you are invited to.

L, Stan ASHO
Citizens search desperately for parking so they can take courses at the Columbus org. Obviously, they are not fully in touch with their OT powers yet since they haven't "postulated" a parking space right in front.

Citizens search desperately for parking so they can take courses at the Columbus org. Obviously, they are not fully in touch with their OT powers yet since they haven’t “postulated” a parking space right in front.

It turns out that there are no non-stop flights from the city where my tipster lives to Columbus.  Of course, there aren’t a lot of direct flights from anywhere to Columbus other than a couple of major airline hub cities like Atlanta and Dallas.  Hell, there are only a couple of nonstops from New York City to Columbus on any given day.  It appears that the only reason for anyone to go to Columbus is because they have to go there, not because they want to. So for my tipster to answer quite truthfully that no, he doesn’t come by the Columbus org much, is kind of obvious.

Given the airline situation with no non-stop flights, my tipster figures that he would have to spend the better part of an entire day traveling to get to this mind-blowing gala holiday event and then most of another day getting back. Never mind about the regging that’s sure to be a big part of this festive event; spending top dollar to get last-minute airfare to spend two days attending an event where he’ll be served mediocre catered food and regged for everything he’s got just somehow doesn’t seem like a great idea at any time of year, much less so close to the holidays that the airways will be jammed with snot-nosed kids flying to see the grandparents, kicking the seat back constantly, whining about whether we’re there yet, and all the other stuff that makes me glad that we in Global Capitalism HQ don’t have to fly commercial any more.

Sea Org vessel "Thetan One" docks on the Ohio River prior to unloading its cargo of Sea Org missionaires sent in by David Miscavige to get the stats "straight up and vertical" before the advertised Christmas banquet.

Sea Org vessel “Thetan One” docks on the Scioto River prior to unloading its cargo of Sea Org missionaires sent in by David Miscavige to get the stats “straight up and vertical” before the advertised Christmas banquet.

The other really interesting thing about this is that the e-mail comes from a fairly senior official at ASHO (American Saint Hill Organization), an “elite” org that is supposed to be all about higher-level training.  But having an upper level org sending out fund-raisers to get people to come to cities far outside their usual orbit for a Christmas banquet, rather than having the local org staff themselves send out the invitations, just smacks of desperation.

I talked to a source who’s familiar with life in the Columbus org, and he pointed out that Columbus is struggling even more than the average Scientology org these days. The population of the Columbus combined metro statistical area is 2.35 million.  Assuming 15,000 Scientologists in a total US population of 310 million, you’d expect to see a grand total of 113 Scientologists in the greater Columbus area.  And if you assume 25 of those are staff, you get a grand total of 85 card-carrying public. According to my local expert, the only reason that Cincinnati (just 100 miles down the road) is doing better, with its own recently opened Ideal Org, is that the husband-and-wife team running the Cincinnati org had much better fundraising success due to their personal efforts. With a weaker management bench, the slightly larger Columbus area just isn’t moving the needle.

Analytical Conclusion

There is a point to all this that goes well beyond the quest for a couple mildly funny chuckles to be had at the cult’s expense.

The fact that higher-level orgs are working to produce events for local orgs and to get people from ludicrously inappropriate locations to come to them is a further leg down in the decay of the Class V org system.  As various commenters have noted before, it appears that, once again, Miscavige is sacrificing the periphery of the empire to protect what have previously been the more profitable parts of the business, most particularly, the courses and auditing offered at Flag, the “Mecca of technical perfection.”

But if Miscavige is willing to sacrifice the “outer” orgs to protect the “senior” orgs, why is he having senior staff at the “senior” orgs put on events (note that the e-mail said that author Stan Booth is “setting up” a banquet, not just inviting people to a banquet). In other words, it sounds like Stan at ASHO is in charge of the event, not just using his mailing list to get people to come.  Somebody who ordered him to do this must think producing an undistinguished local event in a second-tier market is the most profitable use of Stan’s time.  So that means that ASHO is hurting for business as well, probably because their business has been cannibalized by Flag.

The other relevant point is that if there’s no one in the Columbus org who can be trusted with responsibility to plan and execute a fairly simple event, then it is possible that the cult is hemorrhaging trained staff at a sufficiently rapid rate that they simply don’t have anyone locally who can put on an event.

And that, in turn, is a hint that at least some parts of the cult are coming close to the brink.  In my (as yet unpublished) “cult collapse scenario,” I note that the cult can (and it certainly has) continue operating for quite a long time without new recruits, and they can continue to operate for a long time with a diminishing pool of existing members. But one thing they cannot operate without is enough staff to keep the doors open.

One of the way the cult has been trying to keep the doors open after massive native staff defections is to hire people from outside the US and bring them in on a “religious worker” visa.  That works well enough for jobs at Flag, say, where they don’t need to have great English skills to wash dishes in the restaurant, etc.  But when you’re in a local org, at least some percentage of the staff needs to have enough English language skills to negotiate with vendors, to handle such things as setting up catering services, which could involve fairly complex menu choices.  That’s not the sort of thing you can expect someone fresh off the boat to master all that quickly.  So if the Columbus org is running out of native English speakers on staff, that suggests that the usefulness of the foreign staff project may be reaching its end.

But keep in mind: this is a single data point, and the analytical conclusions based on a single data point could very well be wrong.  So I’m treating this discussion as a hypothesis of what might be happening, rather than as definite assertion that this is happening.  It would be really helpful if we all keep our eyes out for data points that either confirm or reject any of the potential conclusions here.

Scientology Daily Digest: Thursday, December 12, 2013

Here’s the promised “science fiction double feature” since I couldn’t get a post out last night.

Most surprising news is that Devon Newman, former head of PR for Las Vegas Celebrity Centre, picked up in a bizarre plot with her roommate to kidnap and murder police, was allowed to cop a plea and walk out of court with a year probation.  See below for further details. This was entirely unexpected given the bail amounts involved and the statements of the police and the DA.  I still think her co-conspirator, a convicted pedophile with a long record, is not going to be so lucky.

Check out the rest of the “General Press” section as there are a number of interesting cult-related articles including an interview with PR powerhouse Pat Kingsley, who Tom Cruise fired in favor of his sister.

Tony Ortega’s Blog

Today, Tony reported that Judge Whittemore will allow the Garcia’s to conduct discovery to look for bogus behavior in the diversity jurisdiction issue before the court in the Garcia case, given that the cult hid the fact that the two trusts involved were California based until it started losing. Apparently, the scope of discovery is fairly limited.  When I read it, the tone of the order makes it sound like Whittemore is not all that optimistic that the Garcia’s will succeed, but he’s just crossing the t’s and dotting the i’s properly.

The post also talks a bit about the UK high court ruling permitting Scientology to conduct marriage ceremonies, which is attracting plenty of press.  There’s a particularly lame BBC interview, where a tame reporter says nothing, though Marc Headley gets in some pretty good comments.

Selected comments: 

Mike Rinder’s Blog

Today, Mike found a couple of amusing bits of FAIL on the main Scientology web site. Minor details like the page where they promise to open a bunch of Idle Morgues by the end of 2013 — three weeks hence — after only opening four this year (versus 11 last year).  They’re gamely struggling to believe that they have a chance of getting Ideal Orgs done in Battle Creek, MI and New Haven, CT.

I can’t imagine why Battle Creek would be home for an org, given its metro area population of less than 140,000.  Incidentally, if we believe that there are 15,000 Scientologists out of a total US population of 310 million, then that implies that there ought to be a total of 6.6 Scientologists in the Battle Creek metro area.  That’s an opportunity to go straight up and vertical, baby!  Perhaps the Battle Creek org is a stealth strategy to penetrate the burgeoning metropolis of Kalamazoo, just 25 miles west on I-94.  With a population approximately double that of Battle Creek, Kalamazoo might be home to approximately 13 more Scientologists.

Mike also points out just how inept the cult’s Volunteer Minister response to the recent Philippines typhoon has been.  Apparently, the site for what Miscavige claims is the most effective disaster relief force in the world still has the same picture of four people at a photo opp, not the thousands of volunteers they try to suggest they have.

Yesterday’s post contains an utterly illiterate marketing piece by Sharron Webber, who, last I heard, was the #2 on the Freewinds.  Unlike so many of the young recruits, Webber is a native English speaker.  Perhaps the nicotine in six packs of unfiltered Kools a day are causing excessive cerebral vasoconstriction?  The thought that someone with such a low level of literacy is in charge of a complex piece of aging machinery which can, if ineptly operated, kill hundreds of people, is rather sobering.

Forum Sites

General News

  • The Raw Story, another site in the burgeoning Tony Ortega media empire, ran a breaking news story that Devon Newman, the former head of PR at the Las Vegas Celebrity Centre, pled guilty in the bizarre Sovereign Citizen police kidnapping/conspiracy that hit headlines in August.  She gets a year probation in return, though her sociopath roommate will probably get a bit different outcome at trial in March.  It will be interesting to see what the cult makes of this for internal PR — talking about how Tone 40 intention beats “wog” justice every time, or something.
  • suicide by defenestration at an office tower holding a number of Scientology-related businesses remains a bit of a mystery as the Clearwater PD has not released the identity of the victim.  The building is or was home to various cult front groups and WISE businesses, including a Narconon office.  It’s unclear whether the Narconon office is still in the building.  Some of the businesses are connected to the Feshbachs and at least one is apparently connected to cult PI Dave Lubow, who’s a figure in the Monique Rathbun suit.  ESMB and OCMB threads will presumably keep up with status updates.
  • Missionary Kid scored a nice find with an academic journal article on the Haifa (Israel) mission going independent.  I don’t know the researcher or the prestige level of the journal, but it’s interesting to note that this unique (in recent history, at least) secession from the corporate church is attracting attention in academic circles.
  • Pat Kingsley, the legendary PR maven who Tom Cruise famously fired in favor of his unskilled sister right before the Oprah couch-jumping incident started to crumble his reputation, checks in from retirement.  Towards the end of the article, she talks about her relationship with Cruise; while mostly diplomatic, she talks about how he started to get crazy about the cult before they parted ways.  After reading the whole profile, I’m impressed by Pat.
  • RadarOnline ran a story about forced labor in cult facilities, harvesting juicy bits from the declarations filed earlier this week in the Monique Rathbun case and putting them together, with yet another epic cult denial at the end.
  • The lead story in the latest issue of “Freedom” magazine begins “The excitement rolled across more than 10,000 Scientologists gathered in multiple large venues at the religion’s Flag Land Base in Clearwater on November 15, 2013…” This is one of the documents presented by the defendant’s attorneys as argument for not deposing Miscavige. It’s a cult-operated site so you should know that they’ll harvest your IP address.

Scientology Daily Digest: Tuesday, December 10, 2013

Perhaps the biggest news today is the Tampa Bay times story that some Clearwater businesses have seen sales plummet in the wake of the Super Power opening, as staff apparently don’t wander between buildings as much, and as the cafeteria in the basement is capturing money that used to go to them.  Way to relate to the community, Scientology! 

Also, Tony’s blog had more insights on how people react to the OT III level, Marty Rathbun posts a particularly provocative long quote from Hubbard on conducting intelligence operations against enemies, Mike Rinder mocks Mark VIII e-meter marketing, and the general press unloads on the cult.

Today’s post is worth a close read as there are some pretty funny discoveries of videos and news stories from around the world.

Thanks to a large number of tipsters and commenters who brought stories to my attention today!

Tony Ortega’s Blog

Tony’s regular Tuesday feature delves a little deeper into the “mysteries” of the OT III level as seen through the eyes of former staff Claire Headley and Bruce Hines; it also features a fun video from Karen de la Carriere and J. Swift on the Ideal Org scam.

My take: What’s really interesting is that both Bruce Hines and Claire Headley said that their first reaction was “what a load of crap!” but their training instantly took over and their devotion to Scientology didn’t waver much.  They both figured it was something they didn’t understand, and vowed to come back later and try and overcome their shortcomings that made them unable to comprehend the brilliance.  Here are two fairly intelligent people who were so indoctrinated by the cult that they were unable to pull free when the alarm bells were ringing loudly.  That’s a pretty powerful warning to others who think they’re somehow immune.

Also horrifying is Claire’s recollection of an accident on the base that left her with a badly broken foot and a broken shoulder, which nearly killed her. The cult wasn’t allowed to call 911 when Miscavige was actually on the base, perhaps because of his paranoia about his personal security.  Just appalling.

From a purely literary standpoint, Hubbard’s description of “Incident One” is probably the lamest bit of handwritten nonsense I’ve seen him pen.  When you read about the Big Bang, even dry physics texts make it sound pretty damned awe-inspiring. But here, Hubbard manages to take any element of wonder and mystery, the key elements of any origin story, out of it and make it sound like a back-of-the-napkin reminder of how to write something so pathetic by comparison that it would get laughed out of town.

Selected comments:

Mike Rinder’s Blog

Mike posts about the craziness of the sales campaigns to get the new Mark VIII super-duper new e-meter in people’s hands immediately.

Apparently, one new and unique feature of the high-pressure marketing campaign is awards for the staff.  The org that sells the most meters will apparently get a gift-wrapped swag basket of some indeterminate contents at some point in the future.  For reference, Harry and David, the long-time gourmet gift basket retailer, offers a $200 gift basket as its most expensive.  Split 30 ways (assuming 30 staff per org) would mean about $6 per employee, or a bonus of the better part of a week’s pay.  This stands as a monument to cult cheapness, a paltry reward to whoever brings in hundreds of thousands in profits.  Of course, such cheapness goes back to “Source,” as Hubbard offered a small plaque as a way of thanking anyone who brought in any of the biggest celebrities then alive in the cult’s first celebrity recruitment campaign.

Mike does the math and thinks this means that the cult really expects to have 7,500 members doing courses actively, assuming a production run of 20,000 units (they were made when he was “in” and have been sitting in a warehouse since then, so he may have a reasonably good idea of exactly how many there are), less 5,000 for orgs and field auditors, divided by two because of the requirement that everyone have two in case one fails.

Marty Rathbun’s Blog

Marty has posted a particularly telling Hubbard quote about intelligence operations and sliming enemies.  It’s a lot deeper than the oft-quoted one-liner justifying “Fair Game.”  To get the full effect of Hubbard’s paranoid viciousness in action, this is worth a read.  Secondarily, this might also serve as a quiet reminder to some of his readers that there is plenty of evidence to counter the view that “Hubbard always good, Miscavige always bad” that some Independent Scientologists espouse.  Incidentally, the full “Manual of Justice” that this quote is taken from appears at http://www.xenu.net/archive/go/man_just.htm.

In fact, the comments are worth reading on this one as they show a fairly diverse range of opinions on Hubbard’s pronouncements here.  The comments are definitely different from what I’d expect on this site or on Tony’s but there is not the lockstep agreement that some might expect.

Forum Sites (ESMB, OCMB, WWP)

Thanks yet again for Aeger Primo for her work monitoring the forum sites.

General News

  • The Tampa Bay Times reported this afternoon that some downtown Clearwater businesses are struggling now that staff are moving into the new Super Power building, and apparently have less time to get out to buy coffee or otherwise spend their meager salaries.  On the other hand, some hope that having all those culties out of the way will clean up downtown Clearwater’s image quicker and ultimately help business get back on track.  Apparently, some of the tourists find the Sea Org uniforms a bit intimidating.
  • The Tampa Bay Times also notes that the mayor of Clearwater sent a note congratulating Miscavige on the Super Power opening, though the article also mentions Mark Bunker’s excellent video about exactly why this is a bad thing for the city to do.
  • Sheriff Lee Baca may not have much time for gladhanding Scientologists, given the arrests of 18 officers and managers in the LA County jail system for a particularly heinous series of crimes.
  • “Enty,” the entertainment lawyer who posts at gossip site “Crazy Days and Nights,” thinks the Bauer Media attorneys could very well question Katie Holmes about whether Tom is Suri’s biological father, and if such questioning comes up, he speculates that Cruise could settle the Bauer suit quickly.  It looks like the Bauer folks have the momentum in the trial since Bert Fields’ clumsy attempt to tie Bauer’s German parent to some sort of Nazi behavior not only fell flat but earned him sanctions.
  • Apparently, “A Very Merry Unauthorized Children’s Scientology Christmas Pageant” is coming to a community theater in the San Diego area.  Since there are apparently almost zero Scientologists in the San Diego area (out of 3.2 million population), the cult will have to bus people down from LA to protest, sadly.

Scientology Daily Digest: Monday, December 9, 2013

David Miscavige and his advisors experiencing the disconnect between their view of how a psychiatric exam feels versus how most of us feel when we talk to a psychiatrist.  Fetch... the COMFY CHAIR!  And if that doesn't work, the CUSHIONS!

David Miscavige and his advisors experiencing the disconnect between their view of how a psychiatric exam feels versus how most of us feel when we talk to a psychiatrist. Fetch… the COMFY CHAIR! And if that doesn’t work, the CUSHIONS!

Two major news items today. First, both sides filed their trial schedule in the Laura DiCrescenzo case.  Of course, Laura’s side has a fairly straightforward schedule, but the cult has a byzantine process involving multiple mini-trials, with two weeks spent in the first such just arguing about First Amendment issues.  And of course, while Miscavige’s fingerprints are mostly absent from this document, he still managed to get into the text a demand that Laura be forced to undergo a psychiatric exam as part of the case.  It’s straight out of Monty Python.

The second major news item is the SP declaration of long-time staff member Ryan Hogarth from the South African branch of the cult, causing the African Scientology blog to speculate that the entire South African community could easily secede from the cult as the Haifa, Israel mission did.

Tony Ortega’s Blog

Tony published the two vastly different proposed trial schedules from plaintiffs and defendants in the Laura DiCrescenzo case.  Laura’s attorneys propose a straight six week trial, while the cult proposes an avalanche of hearings, mini-trials, duplicative effort and other showboating that could easily approach four months in the courtroom, raising a pretty significant cost barrier to Laura.

My take: Usually, when you look through the cult’s legal filings, you don’t have to be a lawyer to spot the craziness that Miscavige has injected into the filing — inflammatory language, etc.  A relatively quick skim of the defendants’ filing shows a relative lack of crazy, which is worth thinking about.  Is Miscavige on vacation after the stress of the IAS event?  Is he distracted? Or is it just a relatively simple filing and not worth his putting his unique “imprimatur” on it?  About the only thing going on here that has any crazy is the proposal that Laura be ordered to undergo a psych evaluation, which to anyone who doesn’t believe in the cult, is kind of a joke.  Apparently, Miscavige is so isolated in his little bubble that he has no idea what an actual psych eval is like.  

Most telling is the proposal for a ten-day hearing on First Amendment issues. Recall that Judge Sohigian was completely upheld on the issue of “priest/penitent confession” laws in the first First Amendment issue raised by the cult.  As one of Tony’s legal team points out, the cult is essentially trying to argue that the “Church” can do whatever it wants to religious workers when it tries to claim that the Court can’t get in the middle of a religious dispute.  Of course, the logical extension of this is the belief that churches can sanction murder, rape, arson, fraud and all sorts of other violations when they come from sincerely held religious beliefs.  But there are plenty of crooked pastors (Jim Bakker, and many many more) who have done jail time for their crimes.

Selected comments: 

Mike Rinder’s Blog

  • Mike’s post today reflected the South African Scientology blog post of how Ryan Hogarth, decades-long Scientologist and former Scientology South Africa President, got declared as the goon squad from Headquarters continues to bang heads together, apparently randomly. Mike observes that Ryan Hogarth was the first local staff person to be allowed to introduce His Imperial Amazingness at an event, instead of using the game show host-like tones of Jeff Pomerantz in a pre-recorded blurb, so great is Hogarth’s credibility among the locals.  Hogarth is a third-generation Scientologist (first one I’ve heard of) who was on staff, mostly in South Africa, for 25 years.  He headed DSA (the local equivalent of OSA) for much of that time, and served for a time as President, which he equates to a figurehead. There’s some great details on the fiasco of acquiring and renovating the Ideal Org building, and more on life in the cult in a far-flung outpost.  The post from Ryan Hogarth himself is relatively long but useful to read, as it details how the Internet brought him to his senses, when he discovered Marty Rathbun’s then-new blog. 
  • Mike’s post yesterday covers the craziness of Super Power marketing, giving yet another example from source documents of how the disconnect between the hype and the reality will accelerate the meltdown of the cult, with more people blowing.

Forum Sites (WWP, ESMB, OCMB)

General Press

  • RadarOnline is picking up the Tom Cruise slave labor story all over again via the declarations of Jon Brousseau, Marc Headley and others that were filed last week in the Mosey Rathbun case.  While Tony reported Brousseau’s story in mid-2012, I’d suspect we’ll see other sites picking up and re-broadcasting the RadarOnline story over the next couple days.

 

Scientology Daily Digest: Saturday, December 7, 2013

Probably the biggest news today is the Lori Hodgson interview on Inside Edition, a US news magazine show, where she traveled to her son’s workplace in Austin, Texas and paid him a surprise visit which was recorded.

But the best performance clearly goes to Mark Bunker’s three-minute appearance in front of the Clearwater City Council on the anniversary of Lisa McPherson’s death, where he eloquently pointed out the absurdity of trying to make peace with the cult given how they’ve treated the citizens of the Clearwater area for the last forty years.

Tony Ortega’s Blog

Tony covers the Inside Edition segment on ex-Scientologist Lori Hodgson paying another surprise visit to her son, who disconnected from her, at his work place in Austin, Texas.  Tony has written several times before on the heartbreaking treatment that Lori Hodgson has received at the hands of the cult and the painful way her kids have chosen Scientology over their relationship with her.

Also, there’s a video of Mark (“Wise Beard Man”) Bunker speaking to the city council in his new home town of Clearwater about the death of Lisa McPherson on the anniversary of her death.  Money quote: “I understand that the city is thinking about finding a better way to work with Scientology, sitting down and mending fences with David Miscavige.  I’d ask you to remember that when Scientology was criminally charged in Lisa’s case, Scientology didn’t bat an eye before destroying key evidence in the case and whisking people out of the country before they could be questioned by the police.”  He then goes on to talk about the harassment of Marty Rathbun, about disconnection, about forced disconnection.  Perhaps he can add an Emmy for performance in front of the camera for this video to the Emmy he received for his work behind the camera a few years ago.

Selected comments:

Mike Rinder’s Blog

  • Today’s post spotlights a couple who used to be field auditors, but who now go for the big bucks traveling around and “regging” people.  He points out the lulz in some of their statements gushing about the Super Power rundown and a few other choice topics.
  • Yesterday’s post contains Mike’s thoughts on the “Cause Resurgence Rundown” (a.k.a., the “running program”), which is now held on an entire floor of the new Sooper Powerz building.  Mike recalls being forced to do it at Int Base back when it was a staff punishment.  He thinks it might be an even bigger bust for $2,500 than Super Power.

Forum Sites (ESMB, WWP, OCMB)

General Press

  • The celebrity press is all over the “chick fight” where Kirstie Alley has taken her usual high road in responding to Leah Remini’s recent comments about disconnection and other problems with the cult.  There are lots of articles in different media including some pretty repulsive fawning from Perez Hilton.  TV Guide weighs in, as does Huffington Post. Leah stays classy and positive throughout, but Kirstie stays true to form, living proof that the cult makes the able more able, and the asshole more asshole.
  • The National Enquirer is reporting that Leah Remini is trying to get back in the good graces of Katie Holmes in order to get Katie to become involved with Leah’s anti-Scientology book project.  The Enquirer claims that Leah could command an advance as high as $5 million but the story claims that publishers want to get Katie Holmes involved as well to ensure the book’s popularity.  I’ve only seen this in the Enquirer, so I don’t know how conjectural the piece is, though the Enquirer is relatively careful with stories to avoid getting sued. After all, Bert Fields never followed up with that threatened suit against the Enquirer over the TomKat divorce.

 

Financial Strategy: Why Do They Require People to Buy the Mark VIII E-Meter for Cash?

Summary: The recent revelation that you have to buy your new Mark VIII e-meter for cash instead of using money deposited with the cult on account has led some to speculate that the cult’s finances are in precarious shape.  Though that is certainly possible, I think it’s impossible to tell from this one data point alone. However, this development suggests that Miscavige is managing the business of Scientology to achieve only one goal, a financial metric that is utterly useless in the real world, but one that allows him to feel like less of a failure when he looks at the numbers than other numbers in the cult.

We also look at what moves Miscavige might make next to continue to grow the business using his management criteria.

The Detail That Sparked the Question

Over at WhyWeProtest, a new thread wonders whether the cult finances are struggling in light of the new requirement that people buy the new Mark VIII e-meter with new cash, rather than using money “on account” that they have paid in advance for courses not yet taken.  Recall that Mike Rinder’s blog yesterday featured a detailed post about how the cult has made this change in the rules.  In some cases, people have put significant amounts of money on deposit; one now ex-Scientologist highlighted in a Tampa Bay Times article had over $350,000 on account at one point.

Forbidding people from using their deposit money to buy e-meters certainly sounds like it could indicate that the cult is running out of cash.  That is indeed possible, but there are other explanations that could also account for this decision.  My inclination is to believe that they’re not in danger of running out of cash. It’s merely bad management.

What Real Executives Manage

There are dozens, if not hundreds of financial numbers that senior executives pay attention to when running a company, to help them keep tabs on how well their business is doing.  But it turns out that only a relatively small handful of these numbers are the key indicators that will move the stock price up or down significantly.   That’s true of the largest, most complicated companies in the world, like Exxon or General Electric.  Every industry is different.  Software companies focus on growth in sales as well as “operating margin” (defined below) while the oil industry could care less about sales figures, since sales includes the cost they pay for the oil they refine, and that fluctuates based on global economics.  If you ask the CEO of Exxon what his sales were, he will give you a blank look; I’ve actually seen it happen when a rookie asked him that when he came to Global Capitalism HQ to review the business a few years back.

But one thing is common to all executives in a real business: the numbers they manage the business to deliver are ones that genuinely reflect how well the business is doing, and that give the earliest possible warning for how the business might be faltering.  They don’t ignore the hundreds of other numbers, but they only lose sleep over a handful of numbers.

Basics of Financial Management

Here are some of the key numbers that appear on financial statements in most businesses.  We’ll refer to most of these in the discussion of Miscavige’s management mind at work.

Sales Sales (a.k.a. revenue) is the money you take in from the product or service you offer. In the case of Scientology, this includes sales of courses, books, auditing services, cruises on the Freewinds, etc.  We also classify donations such as IAS and Ideal Orgs as “sales,” even though real accountants would describe them slightly differently.
Operating Expenses Operating expenses are those expenses you pay in the normal course of business to generate sales.  They would include rent on buildings, utilities, raw material costs, labor, advertising, paper clips, costs of the private jets for the executive team, costs of your IT operation, etc.
Operating Income Operating income is the money left over when you subtract out operating expenses from sales.
Operating Margin Operating margin is the percentage of sales represented by operating income.  Most manufacturing and service companies manage to sales growth plus keeping this number at or above the level that it was at in the same period last year.  It’s all about how efficient you are.
Extraordinary Items Extraordinary items include lawsuit settlements, gains or losses on selling off a division of the company, charges for failed products, etc.
Net Income Net income is what’s left of your operating income after extraordinary items and after taxes (though the cult doesn’t pay any taxes in the US).  At the end of the year, your cash goes up by approximately this amount.
Gross Cash There are two kinds of cash balances that a company holds.  Gross cash is simply the total amounts held in the various bank accounts of the corporation.
Net Cash Net cash is a subset of gross cash. It is what you can actually use to invest in growing the business.  To get from gross cash to net cash, you have to subtract out debt that you owe to the bank or to bondholders, since you’ll have to pay that off.  Importantly in the cult’s case, net cash also subtracts out the amount of money that customers have put on deposit in advance of using services for you.  In the case of Scientology, we believe this number is a significant portion of the reserves.  You can’t count this as net cash because customers could, in an ethically run business, show up and demand that money back, and it is particularly bad form to be unable to refund them on demand.

For a little clarity, here’s an example of how this might work in Scientology.

Let’s say that the cult begins the year with $1.000 billion in reserves.  Over the course of the year, sales from all operations are $200 million. and operating expenses are $140 million.  That means operating income is $60 million, and that means that the operating margin percentage is 30%.  That’s a pretty healthy number relative to a lot of industries, by the way.  The grocery business would kill to get 5% operating margins; 1% to 2% is more normal.

If the cult paid out $30 million in legal settlements that year, they’d have net income of $30 million, and at the end of the year, gross cash would go up by about $30 million, to $1.030 billion. Net cash would go up by the same amount, since the $30 million in profits is not encumbered by a need to be able to pay it back.

If, in the same year that net income contributed $30 million to gross cash, the cult also regged people to put $50 million on deposit for courses in advance of taking them, then gross cash would go up by $30 million + $50 million, to $1.080 billion.  But net cash wouldn’t go up at all because you have to be ready to pay your customers back if they change their mind and want their deposits back.

The One Number I Think David Miscavige Manages

I think David Miscavige manages exactly one number as he reviews the cult’s finances:  gross cash.

I think he does this for two emotional reasons:

  • Mainly, I think he does this because he desperately wants to be able to overlook the negative indicators he’s seeing, such as declining revenue and increased amounts of money paid in legal settlements.  Declining sales over multiple years is a disaster in almost any company, and increasing extraordinary expenses are also problematic because they cost you profits but don’t help you make more money later.  So I think he focuses on the one number that’s least likely to deteriorate, no matter how bad the rest of the numbers in the company might be.
  • I also think that gross cash makes most intuitive sense to a very unsophisticated manager.  When you ask a kid how much money is in his piggy bank, he’ll almost invariably give the gross cash figure, and he’ll forget about the money he owes people because feels better to have as much cash as possible.

I have had the feeling for a few months that this is the number that Miscavige cares most about. This scenario, focusing only on gross cash, explains why he seems to be so un-troubled by the lack of “fresh meat” walking in the door, which would contribute some revenue today, but lots more revenue over time as the cult empties the finances of each new member on the Bridge to Total Bankruptcy.

It’s uniquely tough for the cult to cut operating expenses and boost operating margin, since they have little control over costs like utilities and telephone.  It’s uniquely hard for them to increase profits (and thence cash) by cutting costs since their labor costs are already extremely low, due to the Sea Org slave labor wages.  Most service companies spend from 30% to 50% of sales on salaries, which makes that a juicy target for cost-cutting measures.  But since the $50 per week Sea Org earn in a good week is about 1/10 of the salary of a minimum wage worker in other businesses, the cult won’t be able to manage labor costs to preserve operating margin.

And especially these days, managing to net income is difficult.  Net income is hurt by slowing sales, growing expenses and by extraordinary items.  Those three variables can be very tough to control, especially when the cult seems to be paying out far more in legal settlements the last couple years than in the past.  Operating income is easier to manage than net income, since it doesn’t include extraordinary items, but both of these numbers are hard to manage in the best of time in the most straightforward of companies.

Here’s the magic trick: if you can take in deposits then gross cash can go up even if net income is negative. For example, if the cult does $200 million in sales, $30 million in operating profit, and pays out $30 million in legal settlements, then net income was $0. But if you also add in $40 million in deposits greater than revenue, gross cash goes up by $40 million which looks pretty good. You could almost feel like you were doing something right. The only problem is that while deposits make gross cash go up, net cash would go up by $0, which doesn’t look good.

So now you can see why gross cash is a much more likely number for Miscavige to manage.  By extracting deposits from your customer base, you can make gross cash look good even if the rest of the business is turning to shit.

That, in turn, explains why he fights so viciously to not only avoid giving refunds, but to avoid giving back money on deposit. If he were managing revenue, he’d hate to give refunds because that takes revenue down. But if he’s managing gross cash, that is why he fights so viciously about money on deposit.

What Might They Do Next to Protect Gross Cash?

One commenter suggested that the cult might arbitrarily convert deposits to IAS donations.  I’m not sure that’s too likely.  Here are the scenarios I come up with:

  • First, I think that the lawyers will smell blood in the water if the Garcia’s are successful in getting the cult-specified arbitration system (which apparently has never actually existed) to be tossed out of court.  I strongly suspect that Ted Babbitt is using the Garcias as an initial case before filing tons of suits on fraud related to Super Power.  But I also suspect he and several others are waiting to file a mammoth class action suit to get refund of money on deposit, particularly for ex cult members.  I have talked to a couple of ex’s who would not sue individually but who would happily join a class action suit to recover money.  And due to the precise nature of the documentation, I think recovery for the ex’s would be fairly high, a lot higher than the pennies on the dollar typical of traditional class action suits. Look for the cult to continue to fight the Garcia case tooth and nail.
  • Second, I doubt that they will convert deposits to IAS donations without something that looks like permission from the deposit holders.  The word “conversion” in accounting circles is somewhat dirty — it basically means that you took something and pretended it belonged to you in the first place.  I think the cult’s primary mechanism to hang on to deposits is just to make the refund process as difficult as possible.  I think a suit over conversion, even if there were terms permitting it in the deposit agreement, would easily win.
  • Third, I think they’ll continue to focus over time on IAS donations, rather than taking deposits.  This is a trend already well under way, as evidenced by all those flyers that invite you to donate and move up a status level, but I think it will likely accelerate, even if they can’t really convert deposits directly to donations.  They may try to put status levels “on sale,” promising you 150% credit towards your next Patronius Gluteus Maximus trophy for every dollar you convert from deposits to IAS donations, but I suspect people will blow if they are being regged at par (i.e., one for one exchange of deposit dollars for IAS donation dollars).

Scientology Daily Digest: Thursday, December 5, 2013

Scientologist after attempting to navigate the complexities of the new sales process and the legal agreement governing use of the recently announced, new and improved Mark VIII e-meter.

Scientologist after attempting to navigate the complexities of the new sales process and the legal agreement governing use of the recently announced, new and improved Mark VIII e-meter.

The big news today came on Mike Rinder’s blog, where he relays a note from a contributor about the craziness around the requirement to upgrade to the super-duper all-new (except for the part about being in a warehouse for a decade) Mark VIII e-meter.  The whole article is worth reading carefully, because it sure sounds like the cult is desperate to not only sell the new meter quickly, but to prevent it from falling into “the wrong hands” (i.e., independent Scientologists).

Mike says that some of the annual check-in is to reset a timer on the unit itself that keeps it working for another year.  Apparently, you don’t have to send the unit back for “calibration” every year or two, but if I’m reading the post correctly, there’s a timer that expires every year, after which the meter can’t be used.

And apparently, you can’t pay for the new meter from money that you have on deposit for courses — you have to pony up new cash, immediately, or you won’t be able to be audited, and you won’t be able to continue any courses that are in progress.

Wow.  Just… wow.

Tony Ortega’s Blog

Tony’s story today features the news that Russell Miller’s Bare Faced Messiah: The True Story of L. Ron Hubbard, originally published in 1987, will be back in print in February.  It’ll be published by Silvertail Books, which published BBC reporter John Sweeney’s The Church of Fear earlier this year.  Tony also posted a picture of Lisa McPherson to commemorate the anniversary of her death.

Selected comments:

Mike Rinder’s Blog

As noted above, the cult is engaging in a Kafka-esque nightmare of obstruction, obfuscation and bullying, to get people to buy the new decade-old Mark VIII e-meter.

Forum Sites (WWP, ESMB, OCMB)

Thanks yet again to Aeger Primo for keeping an eye on things on these sites…

General News

 

Well, At Least it Has a Certain Minimalist Quality…

The Point of the Exercise

Summary: The cult sends out the shortest-ever e-mail solicitation piece, good for many laughs. With tongue deeply in cheek, we measure this effort against real-world marketing principles.  We then measure it against the marketing principles laid out in Hubbard’s “management tech” books for additional fun. Unsurprisingly, we discover a major heap of fail.


Editorial Note:  I have been incredibly backed up with various projects and have not had a chance to get back to people who have written in with offers to help with site design, with story ideas, or other contributions.  I want to let you know that I am slogging through almost 300 e-mail messages and responding as best I can; I’m still trying to deal with messages that are three weeks old (!) and am finally making some progress. Please be patient.  I welcome your contributions, but am just completely buried.


The Smoking Gun

One of our Alert Readers forwarded us this e-mail solicitation from the cult. It is perhaps one of the lamest appeals yet, though it is mercifully brief, and thus it has a certain minimalist quality to it. Oh, and it is short enough that the author managed to make it through two sentences without any spelling or grammatical mistakes.

For this post, I wanted to try to figure out how much of the bozo quotient was a function of the individual writing it or how much it was a function of the current Church of Scientology corporate environment, versus how much of it came from Hubbard’s marketing ideas.

Here’s the original e-mail text, reproduced in its entirety.

From: "Tyler Beal" <tyler_beal@mailpac.net>
Date: Dec 3, 2013 4:47 PM
Subject: LRH data: The way to solve any problem
To:  <an alert reader>
Do you know what LRH says is the way you solve any problem?
If you'd like to find out, contact me and I'll give you the LRH data.
Tyler Beal
tyler_beal@mailpac.net
323-953-3435

Things that make my teeth hurt

This is what Scientology marketeers think they're doing

This is what Scientology marketeers think they’re doing

First, my tipster is an upper level OT.  One would certainly hope that by that point in his time in the cult, he has a pretty good idea exactly what LRH said about the magic solution to any and all problems, given all the money he’s spent.  So you’d assume that the cult’s e-mail database reflects the level attained of each prospect, ensuring that they put the most relevant and appealing offer in front of each customer.

But nooooooo!  This e-mail assumes that the reader is a rookie with no clue that there is any received wisdom from “Mankind’s greatest friend(tm)” beyond that found in some of the low-level courses like the incredibly effective “confront and shatter suppression” course.  This is a “spray and pray” approach to market segmentation, rather than any kind of insightfully dividing the customer base into different types, each with different needs and with different buying motivations.

Second, of course, is the one that gets my blood boiling: calling random stuff Hubbard said as “data.” It recently occurred to me that this is one of the biggest mind control gimmicks in the cult.  Data is supposed to be neutral and verifiable.  It doesn’t represent an opinion.  Data is something like “the water temperature measured 10 feet below the surface at this location at this time is X.”  What Hubbard calls “data” are what real scientists would call conclusions.  And a key part of science is making sure that the available data leads to the stated conclusion.

But if Scientology can get you to think of what Hubbard said as “data” instead of “conclusions,” meaning that it doesn’t have to be proven, then they’ve knocked down your defenses and can storm the ramparts of your mind, and basically they will own you after that point.

What Scientology marketeers are actually doing: yelling randomly at customers who can't hear through the noise.

What Scientology marketeers are actually doing: yelling randomly at customers who can’t hear through the noise.

Also missing is the benefit statement.  What benefit will I receive from calling up and allowing myself to be reg’d?  The solution to any problem I might encounter in life? It’s tough enough to believe that Oxyclean, flogged on TV by the late, loud Billy Mays can clean any stain, so it’s harder still to believe that Hubbard’s figured out the solution to absolutely every problem I might face in life.

E-Mail solicitation in the “Wog” world

Unfortunately, this breaks so many rules of direct mail solicitation from the “wog” world that one doesn’t even know where to start.  Here’s a quick list of do’s and don’ts from Alexander Direct Mail Marketing, a large vendor in Utah, along with our take on how they do against the major criteria for success:

What the Experts Say How this E-Mail Stacks Up
1.  Keep your content simple: While print holds people’s attention for much longer than digital media, attention spans are still short. Boil your message down to the most important points, and deliver it with clarity and simplicity. Using the right photos, drawings or other graphics will also help you send concise messages to your reader. Maybe, if you squint at it a bit.  This e-mail is certainly simple to the point of being Zen-like in its minimalism.  It’s not like the lengthy stuff I write in my blog posts.  It certainly fails on the photos, drawings and graphics criterion.
2.  Tailor your message: In order to produce effective content you need to know your target audience. If your message doesn’t apply to them, your direct mail piece is wasted. Make sure you’ve done your research, and that you know the recipients of your message are likely to act to help you reach your goals. Fail.  Sending out something like this to a high-level OT is just bizarre.  Presumably the OT’s will already know Hubbard’s handy-dandy one size fits all solution to all of life’s problems.  And they probably can exteriorize to visit Tyler in his seat at the boiler room operation where he works at Big Blue and figure out exactly what he’s trying to raise money for.
3.  Have a great offer: You don’t need to break the bank offering coupons or giveaways, but you do need to provide value to your targets so that they won’t want to pass up the offer. Whether it’s a coupon, a discount, or merely a great service, your offer should be noteworthy. Fail.  Assuming that the recipient is ignorant of why the cult is sending out this letter, it might work. But anyone who’s been around for a while knows that this e-mail is an invite to a fleecing.
4.  Show off the benefits: No need to make your content sound boastful. Just make sure your message clearly describes the benefit. Don’t use words and images that aren’t relevant or helpful. When it comes down to it, consumers, clients and customers want to know what benefit they’ll receive. Fail.  On the one hand, you might think it’s a win to promise that one simple phone call will solve all your problems.  On the other hand, if the solution is that good, why don’t you already have this important benefit of Scientology?  Intuitively, those receiving this document know the benefits are a lie.

 Marketing the Hubbard way

Promotion:  This lame effort violates some of Hubbard’s tenets of marketing, as simplistic (and often as erroneous) as they are.  For example, Hubbard says “Promotion is the art of offering what will be responded to. It consists only of what to offer and how to offer it that will be responded to. By promotion in a Scientology organization we mean reach the public and create want.” (HCO PL 1 Sep 1979, “Marketing, Promotion & Dissemination Defined).  So obviously, this little effort is not exactly “on Source” because it isn’t doing what Hubbard defines as promotion.

A mystery spot... where they serve a great mystery sandwich in the snack bar.

A mystery spot… where they serve a great mystery sandwich in the snack bar.

The mystery sandwich: But wait!  It might actually be “on Source” after all. In another document, Hubbard says “A thetan is a mystery sandwich. If we tell him there is something to know and don’’t tell him what it is, we will zip people into Div 6 and on into the org.” (HCO PL 25 Jun 1978, “Come-On Dissemination”) So this may explain the supremely non-specific tease our buddy Tyler sent out.  Hubbard says this will always work — “Their own curiosity will pull them along the channel, providing you created the correct mystery in the first place.”

And what is this mysterious “channel” of which they speak?  It doesn’t appear to be the notion of a distribution channel, the typical usage of the term in the marketing world of today. It appears to be the path of interactions from the initial contact to a sale.  Hubbard says,
You channel by indicating where and how to get the data— — never just GIVE the data. And one can keep on doing this to a person— — shuttle them along using mystery.

Well, this is becoming a bit clearer.  Get them to respond, then deliver a few scraps of the answer, then repeat as necessary, as long as the prospect has any remaining cash (and functioning brain cells).

These blithely uttered simplistic strategies seem to be something Hubbard consistently does in “management tech:” to promise that success is trivially easy.  For example, he says “Were we able to clean out just this one factor in management in every org, we’d have a boom, just like that!”  In other words, “if you people weren’t such idiots, we’d have even more money.”  By the way, this is all built on the fallacy of infinite demand that appears to color much of Hubbard’s management thought.

Hype:  Hubbard says that you have to hype the product.  “So don’t understate things in your promotion. Just tell the truth and you’ll find that it’s very effective.”  (HCO PL 19 Sep 1979, “Promotion”)

In HCO PL 26 Sep 1979 (“Copywriting”), Hubbard says “A common fault in writing ad copy or other material, both in marketing and other areas, is an inability to assume the viewpoint of the reader and get the idea of what impression the reader may have when he reads the ad. An ad must be written from the viewpoint of the public that is going to read it.”  True enough.  I wonder just how much thought Tyler put in to looking from the standpoint of his customers.  It is entirely possible that Tyler, recruited to the cult at an early age, hasn’t actually met a customer because he’s been locked in the bowels of Big Blue for too long.

Hubbard says that all marketing material has to be good or you have a “quality degrade,” which means the marketing campaign won’t work.  One of the causes of these: “knowing products or promotion are of poor quality but, for one reason or another, neglecting to remedy them.”  So given the quality of this piece, will Tyler end up in the Hole given that this message is so lame?  We shall see.

The hard sell: In one of the most hilarious statements about Marketing, Hubbard talks about how important it is to use the “hard sell” technique.  He says,

It is necessary in writing an ad or a flier to assume that the person is going to sign up right now. You tell him that he is going to sign up right now and he is going to take it right now. That is the inference. One does not describe something, one commands something. You will find that a lot of people are in a more or less hypnotic daze in their aberrated state, and they respond to direct commands in literature and ads. If one does not understand this, and if he doesn’t know that Dianetics and Scientology are the most valuable service on the planet, he will not be able to understand hard sell or be able to write good copy.

Hard sell means insistence that people buy. It means caring about the person and not being reasonable about stops or barriers but caring enough to get him through the stops or barriers to get the service that’s going to rehabilitate him.

Yep, Tyler’s little ad sure shows the hard sell technique in action. Uncompromising command of the customer as only a true Operating Thetan can do.

Scientology Daily Digest: Wednesday, December 4, 2013

The big news on the day came early in the evening, when Tony Ortega posted a story with a major wave of filings by Monique Rathbun, plaintiff in the harassment suit against the cult.   We predict there’s enough detail there that the Court in the Rathbun case will have to order that Miscavige be deposed.  In my view, this may lead Miscavige to propose a settlement if the cult loses this motion, but I believe that Monique will insist on a far larger amount than was paid in the Debbie Cook case plus permanent restrictions on the cult’s conduct towards her and towards Marty.  However, I predict that the cult will not be able to resist breaking the permanent injunction; it’ll be interesting to see what a Texas court will do to the cult if they don’t follow a negotiated permanent injunction.

Don’t forget that tomorrow is the anniversary of Lisa McPherson’s death.  As the Anons say, this is why.

Tony Ortega’s Blog

Tony filed two stories today.  The morning story features an interview with Mark Headley, who worked at Int Base and was involved in the project to build the new Mark VIII e-meter, which debuted at the Golden Age of Dreck 2 launch, but which was designed and built about a decade ago. Several thousand units have been languishing in a warehouse until now.  Headley points out that a professional outside designer was used (I think the product is actually fairly appealing even if it does resemble the recently redesigned Easy-Bake oven) and says that Miscavige claimed to have spent $20 million on the design. That number seems high to me, even given the usual last-minute micromanagement Miscavige is known for, even if they had to re-do the final production molds for the case multiple times.

Tony’s AM story also notes that Eric Tenorio, a former Narconon staffer who is now a key opponent of the quackery-based alcohol treatment facility, relapsed after surgery earlier in the year and almost went back to Narconon, but managed to find a real rehab facility, one based on sound medical techniques and on use of 12-step programs to aid in recovery.  Glad to see him back in action.

Early this evening, Tony relayed a major filing by Monique Rathbun in her harassment case against the cult.  In that case, Tommy Davis’s deposition was supposedly scheduled for today in Austin.  The next hearing is for December 11.   In these filings, declarations from numerous former cult executives including Mike Rinder and many others all testify that Miscavige is a hands-on micro-manager.  The filings also have significant portions of Debbie Cook’s testimony under oath from her 2012 suit against the cult.  Ray Jeffery raises the obvious point in his legal argument that since the Warren McShane deposition and others didn’t answer whether Miscavige is actually in control of things, DM himself should take the stand to explain things.

Mike Rinder’s declaration contained a few interesting and somewhat obscure Hubbard quotes about how to ruin opponents, which Rinder uses to point out that Miscavige is actively directing operations to smear and destroy perceived enemies.  This may be a watershed, given Mike’s post on his own blog shortly thereafter, in his version of “independent Scientology,” as he’s making it harder for his readers, many of whom I would term “doctrinaire indies” (Hubbard perfect, Miscavige evil) to continue to believe that Hubbard had clean hands while he ran the cult.

Mike Rinder’s Blog

  •  Late this evening, Mike posted a brief story linking to Tony Ortega’s story about the Monique Rathbun case filings.  Mike’s commentary is quite important, since it calls attention to some Hubbard quotes in his declaration.  The Hubbard quotes are all about how to attack, undermine, disrupt and injure opponents of the cult.  Rinder points out that Miscavige is applying the “tech” correctly, which might ruffle the feathers of some of the “Hubbard always good, Miscavige always bad” crowd just a wee bit.
  • Mike’s earlier story echoes a story from the “BackInComm” South African blog about the dire shape of Scientology in South Africa.  This time, the “Life Improvement Centre” in a suburb of Johannesburg is profiled, and it appears to be open for business only intermittently, with creeping weeds and graffiti marring the building.

Forum Sites

Yet again, Aeger Primo comes through with a detailed scan of the forum sites, including the discussion with Eric Tenorio’s announcement of his meltdown and his (new and improved) path to recovery.