Inside Scientology Part 6

Outside of the closed circle of Sea Org executives, no one in Scientology knew of this hostile takeover. Most Scientologists simply saw David Miscavige as the anointed leader and the right man for the job. Among Hubbard's apostles, he was viewed as the truest of true believers: a purist who embraced even the most dogmatic of the Founder's scriptures, perhaps more stringently, some suggested, than Hubbard had himself.

But Miscavige was also a notably sheltered young man who grew up within the bubble-like world of the Sea Organization. He knew virtually nothing of the needs of everyday people, nor was he particularly curious. "Miscavige is very, very cloistered," said Jeff Hawkins. "He never worked in a business. He never went to college. He never even ran a Scientology church or mission. The only example he had of a 'leader' was Hubbard, who, by the time Miscavige worked for him, was already on his way over the edge of sanity."

In his prime, L. Ron Hubbard was a tall, robust, larger-than-life character: a Pied Piper who drew followers through the force of his own charisma. Miscavige was short, boyish-looking, and abrasive. Hubbard was a dreamer with great persuasive skill; Miscavige was a tactician who accomplished many of his goals through pure intimidation. "To call David pugnacious would be one of the nicest things anyone has ever said about him," said one former a.s.sociate. "You will never be as intimidated in your life as you are when you are confronted by David Miscavige."

Hubbard seemed to crave approval; Miscavige kept his own counsel-he was not interested in Scientologists' love, but in their dedication and obedience. His role would not be the visionary but rather the steward who would consolidate Hubbard's movement, cleanse and repackage its image, sell it aggressively, and guide it into a new age. Ten years after his ascension, in a one-time-only interview with the St. Petersburg Times, Miscavige was asked about his rise to power. "n.o.body gives you power," he replied. "I'll tell you what power is. Power in my estimation is if people will listen to you. That's it."

At the time of L. Ron Hubbard's death, in 1986, the Church of Scientology, having weathered nearly a decade of scandal, was now the citadel of rules and codes its Founder had once imagined. In Los Angeles, Scientology's sprawling headquarters on Sunset Boulevard was a fortress, staffed by eager young Sea Org members in crisp naval-style uniforms and patrolled around the clock by security guards. Sophisticated locks, whose combinations "continuously changed," as one story in the LA Weekly noted, protected the church's offices and course rooms. But perhaps most striking, particularly for a movement promoting "total freedom," were the wanted posters that hung on the walls of the Los Angeles base, offering a $500 reward for information on different church "enemies."

Miscavige's revolution had intensified Scientology's us-versus-them atmosphere. It had also created defectors, including some of Scientology's highest-ranking executives, who charged, among other things, that over the past several decades the Church of Scientology had defrauded and in some cases brainwashed them, subjected them to abuse through its punitive ethics policies, and then, after they left the church, continued to hara.s.s them.

Though Miscavige and his allies denied these allegations, the defections proved to be a public relations disaster for the church. By the mid-1980s, juries across the United States were hearing cases brought against Scientology by its dissidents, occasionally returning judgments in the tens of millions of dollars. At the same time, a splinter network of Scientologists, known as the "Free Zone," was posing a challenge to the organized church by forming independent Scientology groups.

The most prominent leader of the Free Zone was David Mayo, once the highest-ranking technical officer in Scientology and the creator of some of the church's most sophisticated auditing techniques. A Scientologist since the late 1950s, Mayo had been trained by Hubbard personally and later supervised the Founder's auditing; he also audited Hubbard himself. In April 1982, Mayo received a letter from L. Ron Hubbard appointing him the guardian of Scientology's doctrine in the event of Hubbard's death. Shortly after, the Commodore's Messengers, who'd received copies of the letter, circ.u.mvented Hubbard's orders by accusing Mayo, with a group of sixteen other senior executives, of trying to take over the Commodore's Messenger Organization. Mayo was quickly removed from his post in the purges overseen by Miscavige.

But where many other executives in his position had abandoned Scientology, Mayo set up an independent auditing practice in Santa Barbara, called the Advanced Ability Center. Then he sent out a letter to the many Scientologists he knew, explaining the circ.u.mstances of his removal, and announced that he was open for business. Gale Irwin and DeDe Voegeding were among many Scientologists who flocked to the center in Santa Barbara. "It was wonderful," said Irwin. "There was none of the BS but all of the goodness of what we'd known Scientology to be."

Before long, Mayo's operation was grossing $20,000 to $30,000 per week, using the same techniques and materials that Hubbard had created for Scientology. This, to the church, const.i.tuted "squirreling," which made Mayo a target for Fair Game. As Jesse Prince, then a senior executive in RTC, recalled, "DM became infuriated and ordered Mayo's new group to be destroyed using all means possible." The RTC began a newsletter campaign, denouncing Mayo as a squirrel and accusing him of a broad range of crimes ranging from falsifying records and "altering" Hubbard's teachings to "s.e.xually perverted conduct."

The RTC also organized groups of Scientologists who called themselves the Minutemen to hold noisy protests in front of Mayo's Advanced Ability Center. The church also hired private investigators to rent office s.p.a.ce above Mayo's center and electronically bug his offices. One of these investigators, Eugene Ingram, was a former sergeant of the Los Angeles Police Department who'd been fired by the department in 1981. Enlisting the help of other ex-cops, Ingram began a campaign of hara.s.sment, informing local business owners that they were investigating Mayo for white-collar crime and linking him, falsely, to international drug smuggling. The church also filed a RICO suit against Mayo's group, arguing that they were conspiring with other Free Zone dissidents to use some advanced auditing materials that the church claimed had been stolen from a European Scientology organization. In 1985, the church succeeded in getting a federal injunction preventing Mayo from selling Scientology services; by 1986, the Advanced Ability Center, bankrupt after several years of hara.s.sment and litigation, shut down.

But by then, thousands of Scientologists in Europe and the United States had dropped out of the organized church, disillusioned by Miscavige's destruction of the mission network, which many people saw as Scientology's life blood. By 1986, though Scientology officially claimed two million adherents, Sea Org members put the numbers at far lower: perhaps 500,000. Anecdotal accounts during the early and mid-1980s reported an exodus of hundreds from individual Scientology missions across the United States and thousands, perhaps even as many as thirty-five thousand, by Alan Walter's estimate, leaving the Church of Scientology.

But the tens of thousands of Scientologists who didn't abandon the movement readily accepted their leaders' a.s.sertions that Scientology was the victim of religious persecution and that the defectors were "heretics." The church responded according to the Hubbard playbook-with an adamant defense of Scientology. This campaign, known as the "Religious Freedom Crusade," peaked in 1985 and 1986 and involved thousands of Scientologists around the world. Its high point was the so-called Battle of Portland, in which thousands of Scientologists-a huge gathering of Minutemen-descended upon Portland, Oregon, in May and June 1985 to protest a $39 million judgment awarded to Julie Christofferson t.i.tchbourne, a twenty-seven-year-old former Scientologist who had sued the church for fraud. When the judge in the Christofferson t.i.tchbourne case threw out the jury's decision on a technicality and declared a mistrial, the Scientologists in the courtroom that day erupted in whoops and applause.

The Christofferson t.i.tchbourne reversal was a pivotal moment for David Miscavige. He not only needed to defend Scientology and establish his leadership, but he also knew the future depended on recasting Scientology as a mainstream church. Just as Hubbard had before him, Miscavige understood the power religion had in the culture and its effectiveness at bringing in cash. The 1980s were not unlike the 1950s in their conservatism and materialism, and churches that embraced those values flourished in this era. With the patronage of Ronald Reagan, and later George H. W. Bush, the Reverend Jerry Falwell became the most prominent religious leader in America, and his group, the Moral Majority, became a national political movement in which faith-fundamentalist Christian faith-was linked with upstanding social, economic, and religious values for the first time in decades.

In a campaign spearheaded by Jeff Hawkins and his marketing group, Scientology now began to promote itself aggressively as a "major religion" -just like "Protestantism, Buddhism, Judaism, Catholicism"-in glossy newspaper supplements. To forge bonds with mainstream Christian groups, the church urged members to attend local Sunday church services, mingle with the congregation, and introduce themselves to the minister and his wife. A key goal was to get local ministers to sign notarized affidavits affirming that Scientology was a "bona fide religion," according to one tip sheet published by the church. To b.u.t.ter them up, the doc.u.ment urged, Scientologists might tell the minister his sermon was "brilliant" and ask if he'd be willing to speak at their church. "He'll have a hard time refusing that one!" it noted.

To further reinforce Scientology's legitimacy, the Religious Freedom Crusade began to sponsor ec.u.menical conferences in Los Angeles, reaching out to religious leaders of other faiths by impressing upon them that any legal action brought against the Church of Scientology was a threat to all religions. By December 1985, such mainstream organizations as the National Council of Churches and the Coalition for Religious Freedom had voiced support for Scientology and its "right to compete for converts without interference from the courts."

But the cases against Scientology continued. In 1986, a jury in Los Angeles awarded $30 million to the former Scientologist Larry Wollersheim, who'd waged a six-year lawsuit against the church, which he charged had driven him to the point of suicide. In response to the verdict, the Religious Freedom Crusade descended on the Los Angeles County Courthouse much as it had the year before in Portland. This time it was the Reverend Ken Hoden, president of the Church of Scientology of Los Angeles, who spearheaded the campaign, at one point addressing a rally of over a thousand Scientologists; in his speech he compared them to the foot soldiers of the American Revolution. "If you want your rights guaranteed, you have to fight for them," he said. "Larry Wollersheim will never get one thin dime from the Church of Scientology!" "Not one thin dime for Wollersheim" became a refrain for the next twenty-two years, as the church fought consistently against awarding Wollersheim any damages.*

With Miscavige's full a.s.sumption of power in 1988, Scientology began to settle many of the lawsuits filed against it, often by offering litigants and their attorneys cash payouts to stop their a.s.sault on Scientology. Along with a coalition of other religious groups, the church also pushed a bill through the California state legislature protecting churches and members of the clergy from being a.s.sessed large punitive damages in lawsuits brought against them.

But Scientology faced one last formidable adversary: the Internal Revenue Service. Scientology's conflict with the IRS originated in 1967, when the agency, which had previously granted tax exemption to Scientology, revoked its tax-exempt status after finding that Scientology, and Hubbard in particular, seemed to be profiting from the operation. The Church of Scientology appealed this decision and refused to pay taxes-a stance it would maintain for the next twenty-six years.

This reaction prompted the IRS to embark on a deeper examination of Scientology as a "dissident group." Between 1969 and 1975, the Church of Scientology and its activities were monitored by three different agencies within the IRS. Scientology, in turn, monitored the IRS as part of Operation Snow White.

Even after Operation Snow White was uncovered, Scientology's war with the IRS only intensified. In September 1984, the U.S. Tax Court denied the church's appeal of the IRS's original 1967 ruling, concluding, as others had done before, that Scientology "made a business out of selling religion." The judge went into great detail about Scientology's many acts of obstruction, noting how Hubbard had once ordered his staff to mix up some two million pages of tax-related doc.u.ments to make it difficult for IRS agents to sort through them. The court noted that "criminal manipulation of the IRS to maintain its tax exemption (and the exemption of affiliated churches) was a crucial and purposeful element of [Scientology's] financial planning."

Meanwhile, the IRS's criminal investigation into Hubbard's finances had moved on to examine the activities of the RTC and Author Services, as well as their key officials. For several years, Miscavige would later maintain, he and several other officials were the target of investigation by the IRS's Criminal Investigations Division. The IRS didn't comment on the investigation, and the case was dropped with Hubbard's death in 1986. But Miscavige never forgot. To Scientology's new leader, as to its Founder, the IRS represented far more than a powerful government agency determined to "suck the blood from the whole country," as Miscavige once put it; it was the vanguard of a global campaign, launched by psychiatrists, to crush the church.

"A tax-exempt organization is not subject to the myriad complexities of the Internal Revenue Code which can be used to hara.s.s and destroy organizations the IRS does not like," Miscavige told his flock. "But most importantly, because all bona-fide religions and churches in the United States do have tax exemption ... if the IRS refused to grant such to Scientology that fact alone could be used to [discredit] the church internationally." Without tax exemption, he argued, Scientology would never be seen as a religion. Nothing, in Miscavige's mind, could damage Scientology more.

In 1988, Marty Rathbun received his next a.s.signment from Miscavige: launch a campaign to win tax exemption from the IRS. The plan, according to Rathbun, was to follow L. Ron Hubbard's edicts in the most strategic way possible in order to overwhelm the agency and wear it down. To prosecute this war, Rathbun would rely upon the Office of Special Affairs, which he had helped establish five years earlier. Since then, OSA had carried out numerous a.s.signments, ranging from litigating against Scientology enemies to far stealthier black operations, just as the Guardian's Office had always done.

Staffed by some of Miscavige's closest a.s.sociates, OSA also employed numerous former Guardian's Office officials who, having survived the purges of the early 1980s, had been offered a second chance. "The measuring stick in the Church of Scientology has never been whether you were partic.i.p.ating in illegal activities#x2014;it's whether you were caught," Jesse Prince, who took part in several intelligence operations in his capacity as an RTC executive, told me. "Those who weren't caught and punished were still used."

Like the old Guardian's Office, OSA handled public-facing activities: legal affairs, public relations, and Scientology's various social betterment programs. It also handled its most secret undertakings and continued to use Scientologists as informants and operatives, as well as employing a cadre of private investigators. It had been OSA that had ruined David Mayo and destroyed his independent Scientology network, using private investigators like Eugene Ingram, who served OSA for many years. The Office of Special Affairs had also created Scientology's Crusade for Religious Freedom as a public relations strategy.

But whereas the Guardian's Office had been an impregnable ent.i.ty so covert as to not even appear by name on the church's organizational chart, OSA was listed in Scientology's incorporation papers. "Where OSA differs from the Guardian's Office," explained one former Scientologist who was an operative for both intelligence bureaus, "is that OSA wants to seem above board and approachable. That makes Scientology seem more approachable, which, they hope, will help the church operate as a religion freely, without hara.s.sment." In service to this goal, OSA made more of an effort to create a legal wall between the church and any covert activities, relying much more on private investigators, and paying a legion of outside attorneys.*

They kept busy. Throughout the late 1980s and into the early 1990s, the Church of Scientology filed some two hundred lawsuits against the IRS, while more than twenty-three hundred individual Scientologists sued the agency over its refusal to allow them to claim their Scientology contributions as tax deductible. These "cookie-cutter suits," as Rathbun described them, soon became cases that cost Scientology tens of millions of dollars in legal fees-with presumably similar cost to the IRS.

At the same time, the church, long an expert on using the Freedom of Information Act, filed hundreds of requests for internal IRS doc.u.ments. Some of their findings were published in Freedom, a magazine created by the Office of Special Affairs to shed light on various government agencies and their abuses. In Washington, D.C., OSA deployed Scientology operatives to flock Capitol Hill, attend congressional hearings, and network with Hill staffers. One former OSA official explained that for more than a year, she'd fed congressional aides information on the IRS's handling of groups as divergent as the Amish and owners of small businesses, to shed light on its often prejudicial auditing and investigative practices. "They all knew we were from the church. It was a public relations thing," she said. "We were trying to get people to come forward and show that there were attacks on other members of the public, not just on Scientology."

To further this effort, OSA created, and financed, a gra.s.sroots lobbying organization known as the National Coalition of IRS Whistleblowers to support IRS employees who wanted to expose corruption. The coalition was planned through Freedom magazine and hired as its president a former IRS agent named Paul DesFosses. Stacy Young, then the managing editor of Freedom, later told the New York Times that "the whole idea was to create a coalition that was at arm's length from Scientology so that it had more credibility."

By the summer of 1989, these efforts were beginning to pay off. The National Coalition of IRS Whistleblowers helped spark congressional hearings on IRS abuses, based on leaked doc.u.ments and other records that showed, among other things, that several Los Angeles IRS agents had shielded a California apparel manufacturer from a tax investigation after the agents bought property from the manufacturer. The New York Times, in an op-ed published on July 24, 1989, predicted that the proceedings might be the "most startling Congressional hearings since Watergate."

The hearings did expose significant abuse within the agency. The Church of Scientology, emboldened, began to press for further IRS reform. On April 16, 1990, David Miscavige wrote an editorial in USA Today calling for the abolition of the IRS and the creation of a new "value added" tax on goods and services. In October 1990, bands of whistle-blowing Scientologists with the National Coalition of IRS Whistleblowers protested in front of the IRS offices in Washington, D.C., offering a $10,000 reward to any agent willing to expose IRS abuses.

The church also spent roughly $6 million on a series of full-page advertis.e.m.e.nts that ran in USA Today and the Wall Street Journal. One advertis.e.m.e.nt, with the heading "Don't You Kill My Daddy!" addressed an incident in which "a band of armed IRS agents" supposedly tried to choke an Idaho man who hadn't paid his taxes. Several of the ads also featured photographs of individual agents, including the IRS chief, Fred Goldberg Jr.

Scientology did not confine its war to the IRS as an organization. Following the well-worn path that L. Ron Hubbard had laid out, the church hired private investigators to dig into the lives of IRS employees. One of these investigators, Michael L. Shomers, later told the New York Times that in 1990 and 1991, he was retained by the Church of Scientology to perform a variety of services, including "looking for [the] vulnerabilities" of various IRS agents. Posing as an IRS employee, Shomers said he attended IRS conferences, where he took notes on those agents who seemed to have a drinking problem or were being unfaithful to a spouse. He then provided the church with the names, and in some cases the phone numbers, of agents he thought it might be easy to blackmail.*

In August 1991, the church filed a $120 million federal lawsuit against seventeen individual IRS officials, accusing them of various illegal acts, including infiltrating the church using paid informants, conspiring to plant phony doc.u.ments in Scientology's files, and in one case, attempting to rewrite the IRS definition of church to enable the agency to deny the Church of Scientology its exemption.

The agency, overwhelmed, began to feel the c.u.mulative effect of the church's pressure campaign. "It was blatant hara.s.sment," opined one formerly high-ranking IRS official. He'd been hara.s.sed by Scientologists, he noted, since the 1970s. "They have a nasty habit of finding your unlisted telephone number and calling you at two A.M., just to let you know they're there." One a.s.sistant commissioner repeatedly found his garden hose mysteriously turned on in the middle of the night. Other agents reported that their dogs and cats had disappeared.

In the fall of 1991, Miscavige proposed meeting with the IRS commissioner Fred Goldberg, personally, to work out a deal. He floated the idea, said Rathbun, during a meeting with the church's lawyers based in Washington, D.C. The attorneys balked. But Miscavige insisted, and Goldberg agreed to see them later that week.

As Rathbun later recalled, Miscavige opened the meeting with a twenty-minute speech that included a pa.s.sionate defense of Scientology as a legitimate religion. He acknowledged the Church of Scientology's history of hara.s.sment and lawsuits, but claimed that the church had never had much choice. "We're just trying to defend ourselves," he said.

Then he made a peace offering. "Look, we can just turn this off," he told Goldberg, in reference to the lawsuits-provided that the Church of Scientology could get "what we feel we are actually ent.i.tled to," which was full exemption. Goldberg had been with the IRS since 1982, and was, by all accounts, eager to make the messy Scientology battles go away. During a break Goldberg came up to Rathbun and asked if Miscavige was serious. "We can really turn it off?"

Rathbun looked at the commissioner. "Like a faucet."

For the next two years, Rathbun and Miscavige made weekly trips to Washington, D.C., to meet with a five-man working group of IRS officials that had been put together by Commissioner Goldberg, outside normal channels. The group was highly irregular; it bypa.s.sed the IRS's Exempt Organizations Division, which would have normally handled the review of the Church of Scientology's status. When asked about this, Rathbun suggested that Goldberg had tried to eliminate the "Scientology haters" from the review process, which required creating his own side group to review the claims.

Every week, Rathbun and Miscavige returned to Los Angeles with questions from the tax authorities; their aides would work diligently to prepare answers for the officials' next trip. "There was a huge number of people putting together all of this information: binders and pictures, charts," recalled Tanja Castle, who was one of David Miscavige's secretaries at the time. "The whole religion of Scientology was basically explained to the IRS: the Grade Chart, the ethics conditions ... [Dave and Marty] were trying to show these guys how Scientology is a religion, how it actually did conform to the basic tenets of a religion, how it wasn't for profit-we gave them all the finance records from all the treasuries, all the way down to the lowest org. The entirety of Scientology had to get their financial records straight"-a difficult task, as most of the organizations kept few if any records.

Indeed, said one church finance officer, the church's finances were such a mess, it had to reconstruct its books wholesale. "There really were no books," she said. "Had anyone from the IRS come in and looked at our finances, they would have never given us any kind of exemption. Some of these orgs hadn't recorded their income, yet their members were claiming on their tax forms that they'd donated tens of thousands of dollars to Scientology, and no one could prove it. They had no records that actually gave you any idea of what a church had, or what it spent-and I'm talking about all the organizations all over the country."

To fix this problem, David Miscavige had created an "audit task force" in 1987 to do forensic accounting. In Los Angeles, Scientology's Pacific Area Command Base became the site of a frenzied audit involving 120 Scientologists who worked nearly round the clock to make sense of the church's finances. In New York, a task force of around 50 people set up shop on a floor of the New York Org in midtown Manhattan and did the same thing. Over the next several years, as the church's lawsuits and investigations of the IRS ballooned, these Scientologists pieced together the books of every Scientology organization, mission, and church-affiliated ent.i.ty in the United States.

Finally, in the fall of 1993 the two sides reach a settlement, the details of which would not be fully known until the end of 1997. In a highly unusual move, the IRS had declared the agreement secret, not subject to release through the Freedom of Information Act or its own code of regulations.* It was a sharp departure from how other religious organizations had been treated. As the New York Times later noted, both the Jimmy Swaggart Ministries and an affiliate of the Reverend Jerry Falwell's had been "required by the I.R.S. to disclose that they had paid back taxes in settling disputes in recent years."

The excuse given within the agency was that the Scientology fight had been tying up IRS resources for too long. But it was puzzling, the official noted, because the IRS staff involved in the agreement had also been fairly confident they'd ultimately win the war.

For twenty-five years, the IRS had steadfastly insisted that Scientology was a business, and it had prevailed in all of the substantive suits brought by the church. As late as June 1992, the U.S. Claims Court had upheld the IRS's denial of tax-exempt status to the Church of Scientology. The ruling strongly supported the agency's position that the church was a commercial organization, and again the judge reproved it for deliberately deceptive practices-this time in designing its financial structure. "The decision [to settle] came as an enormous shock to all of us," the official said.

In an editorial, the St. Petersburg Times wrote that the IRS had "surrendered" to the Scientologists. "Instead of tough tax law enforcement, taxpayers are seeing a Scientology sellout." Privately, many people within the IRS agreed. Several agents who'd been a.s.signed to process the church's formal application after the agreement was reached later confessed that they had been instructed to ignore substantive issues while processing the application. "If you ask me, Goldberg couldn't put up with the hara.s.sment like the rest of us did," said the former high-ranking IRS official, whose tenure with the agency dated back to the 1970s and Operation Snow White.

On the evening of October 8, 1993, more than ten thousand Scientologists, the largest meeting of Scientologists in history, gathered at the Los Angeles Sports Arena. The stage at one end of the arena was draped in blue banners, with gilded romanesque columns and torches. Miscavige stood at the podium in a black tuxedo, beaming.

"There will be no billion dollar tax bill [to the IRS] which we can't pay," Miscavige announced. "There will be no more discrimination. There will be no more twenty-five hundred cases against parishioners across the United States. The pipeline of IRS false reports [about Scientology's activities] won't keep flowing across the planet. There will be no more nothing-because"-Miscavige paused for dramatic effect-"the war is over!" The band launched into triumphant music and the audience rose to their feet, screaming and cheering as the words "THE WAR IS OVER!" flashed on giant screens behind Miscavige's head.

Marty Rathbun has always insisted that the Church of Scientology won its exemption legitimately, through lawsuits and other above-board forms of pressure. Aside from the testimony of Michael Shomers, there has never been any evidence to prove that Scientologists brought into play some of the more underhanded tactics they had used, for example, in the prior a.s.sault on the IRS, Operation Snow White. But the sheer magnitude of the church's exemption was astounding. The deal granted tax exemption to all of Scientology's 150 U.S. ent.i.ties, including Miscavige's RTC; the seat of its international management, the Church of Scientology International; the Flag Service Organization in Clearwater, Scientology's largest and most successful "church"; and its advanced organizations in Los Angeles. It also gave exemption to the church's various social betterment programs. These included Narconon, a franchised network of drug treatment and rehabilitation centers, whose directors often claim to have no direct a.s.sociation with the Church of Scientology; Applied Scholastics, an organization that licenses a special, Hubbard-endorsed educational method called "study technology" to Scientology-run schools as well as to secular public schools and tutoring programs; and the Citizens Commission for Human Rights, a lobbying organization that promotes Scientology's anti-psychiatry agenda in Washington and elsewhere. Also exempt were the two publishing houses that were the exclusive publishers of Hubbard's books, both the Scientology-related texts and his wholly secular, and profit-generating, fictional works.

Though it owed roughly $1 billion in back taxes, Scientology had been fined just $12.5 million. The IRS also canceled payroll taxes and penalties against seven top Scientology officials, including Miscavige, and dropped audits of thirteen Scientology organizations, including the Church of Scientology International. In exchange for all of this, Scientology agreed to drop the thousands of lawsuits it had brought against the IRS and its officials.

And not only that, Miscavige announced triumphantly, but all future Scientology churches would never have to go through the exhaustive paperwork the IRS requires to prove tax-exempt status: all they would have to do would be to meet specific qualifications laid out and enforced by Scientology's Mother Church, which would grant these new organizations exemption themselves and then pa.s.s along the pertinent data to the IRS for its records.

Every audit or tax action currently pending against Scientologists was canceled. "There are no more tax court cases, there are no more disallowed deductions," Miscavige said. The IRS had even agreed to send, at U.S. taxpayers' expense, a special church-written fact sheet, "Description of the Scientology Religion," to many foreign governments, with a letter explaining that after thorough review, the U.S. tax authorities found Scientology to be "organized and operated exclusively for religious or charitable purposes." It would be a significant step, church leaders hoped, in resolving some of Scientology's conflicts abroad-and, like everything else about the agreement, this was an unusual step.

While many other religious groups in America have been given sweeping exemptions, no organization with the contentious history of the Church of Scientology has ever been exempted in such an overarching manner. In 1994, one year after Scientology's tax exemption was announced, an Orthodox Jewish couple from Los Angeles, Michael and Marla Sklar, tested the fairness of this agreement by suing the IRS for the right to deduct their children's religious education from their taxes just as Scientologists were allowed to deduct the price of auditing.* The Sklars lost and appealed, and ultimately took their case all the way to the Supreme Court. In October 2009, the justices refused to hear the case, without comment.

"The power of our group is greater than you can imagine," Miscavige, in his victory speech, told his flock, who had met his announcement with almost ten minutes of uninterrupted applause. Scientology was now a religion, protected by the laws of the U.S. government. Those Scientologists who'd ever doubted the mission, or Miscavige, had long since departed. Those who remained were the truest of believers, and David Miscavige, the young disciple of L. Ron Hubbard, was unequivocally their leader. Scientologists would follow him anywhere, unquestioningly, from now on.

"What exactly does this [exemption] mean?" Miscavige said. "My answer is: everything. The magnitude of this is greater than you may imagine ... The future is ours."

Not a soul in the audience had reason to doubt him.

PART III.

Chapter 9.

Lisa.

TRY TO DEFINE Scientology, and even those who understand its basic concepts will inevitably come up with a multiplicity of descriptions: alternative to psychotherapy, social movement, transnational corporation, cult, religion. One of its essential characteristics is its aggressive response to challenges, whether they arise from within the movement or outside it. Some journalists have referred to Scientology as a hydra for this uncanny ability to restore itself despite numerous blows to the head. This power to reinvent itself lies at the heart of the church's business plan.

Scientology means different things to different people; simultaneously its essential qualities remain hidden from public view. This combination of flexibility and mystery has allowed church leaders to turn Scientology into whatever they want it to be, depending on time period and need. In the sixty-plus years since it was founded, Scientology has changed its image over and over through a savvy marketing strategy that has presented the church as forever new and improved and, in some cases, as transformed altogether. At no time was this more obvious, or necessary, than during the late 1970s and early 1980s when, fresh from the ignominy of Operation Snow White, Scientology needed to rebrand itself almost entirely.

The Scientology name had been tarnished by scandal. And the product, which had been continuously refreshed by Hubbard during his twenty-five years at the helm, was beginning to stagnate, thanks to the Founder's increasing isolation. But the packaging, church officials realized, could still be vibrant. Which is how it came to be that Scientology was suddenly reimagined as a self-help movement.

The 1970s, as the conservative journalist David Frum points out, have often been overlooked in favor of the far more colorful, and seemingly more influential, 1960s. But as he notes in his book How We Got Here, an engrossing a.n.a.lysis of the 1970s, it was those "strange feverish years" following the sixties, the years when the bottom seemed to drop out of America, and indeed, out of many parts of the world, that transformed U.S. society into the branded, self-obsessed, confessional, technologically efficient, widely overconfident yet deeply vulnerable place it is today. "They were a time of unease and despair, punctuated by disaster," according to Frum.

This was the culture the Church of Scientology found itself in after L. Ron Hubbard went into hiding and David Miscavige, having never experienced the "wog world" in any substantive way, began his ascent to power. Jeff Hawkins, who'd joined Scientology at the peak of its hippy-dippy era, was now charged, as head of strategic marketing, with selling the church to a new generation. With the approval of L. Ron Hubbard, and with the help of outside consultants, including a former creative executive from the ad agency Chiat/Day, Hawkins set about devising a strategy that would remove the word Scientology altogether from many promotions and replace it with what he and others saw as a safer subst.i.tute: Dianetics. This term, having died a quiet death in the 1950s, was unfamiliar to the population at large, making it the perfect name for a product that could be shaped to fit the current cultural moment and, Hawkins hoped, signify a new beginning for the movement.

To sell this new Dianetics, which was still Scientology, but with different packaging, Hawkins and his marketing team conducted national surveys. They discovered that what had worked in the 1960s and early 1970s-promoting Hubbard's ideas as a form of spiritual enlightenment, or alternatively, as rebellion against the status quo-would not work in the go-go 1980s. What might capture potential converts, they found, was promoting the philosophy as a form of self-improvement and, for those in need of it, "recovery" from the various indulgences of the past. This fit neatly with the entire premise of Dianetics, which had always been marketed as a set of techniques to increase physical and psychological health, self-confidence, and success.

The pitch Hawkins came up with, a promotion that would ultimately put the book Dianetics on the New York Times Best-Seller List, was "Invest in Yourself." The campaign kicked off in 1982. Over the next five or six years, as leaders were purged and longtime members departed Scientology in disillusionment, tens of thousands of new people were drawn into it through books on Dianetics, self-improvement seminars, and one-on-one evangelism. One of these new converts was a smart, a.s.sertive, impressionable young woman named Lisa McPherson.

Lisa was the younger of two children raised by Jim McPherson, an insurance salesman, and his wife, Fannie, a homemaker. Born in Dallas, Texas, she grew up in a middle-cla.s.s neighborhood on the northeastern side of the city, where she was a popular, diligent student and a member of the drill team. Lisa was also pretty, with wavy light brown hair, a curvaceous figure, and a vivacity that typically made her the center of attention. Acquaintances recalled her as "fearless" when it came to making friends, a person who could start a conversation with anybody.

Lisa's outward joie de vivre masked a host of insecurities, however. As the daughter of alcoholics, she had endured a rocky childhood. Her mother often took her first drink at ten in the morning and continued imbibing throughout the day: more than once, Lisa would come home from school to find her mother pa.s.sed out, sometimes wearing only her underwear. "I hated her for always being a drunk," Lisa later wrote.* But she rarely confronted her mother for fear of what she might do. Fannie was p.r.o.ne to drunken rages. "She let loose on me, not spanking but hitting," Lisa wrote.

This abuse also traumatized Lisa's older brother, Steve, who committed suicide when he was sixteen. Lisa, then fourteen, was devastated, and turned to s.e.x and drugs to mask her anguish. Over the next several years, Lisa led an accomplished double life: maintaining a good-girl exterior while drinking, smoking pot, and, by her own admission, sleeping with virtually anyone who asked, including the husband in a family that employed her as a babysitter.

After high school, Lisa, who'd decided to skip college, went to work as a customer service representative at the Southwestern Bell phone company, where her natural effervescence made her a hit with both clients and co-workers. But she was still troubled and soon became involved with Don Boss, the owner of a Dallas sheet metal shop. They'd met in 1979, when Lisa was nineteen and Boss thirty-five. One month after they met, the couple eloped.

Boss was violent and a heavy drinker, and Lisa soon realized she'd made a mistake. "They had a real rocky time," recalled her childhood friend Carol Hawk. "He was very abusive and I think at one point he tried to kill her and that's when she decided to divorce him." Nine weeks after marrying, Lisa divorced Don, but he remained in her life. She found it impossible to completely break away from him, and in the spring of 1982, Lisa agreed to marry him again.

It was around that time that one of Lisa's co-workers began to talk to her about Dianetics, describing it as a "tool to improve your life" and urging Lisa to try it. Lisa latched onto the proposal. "I don't know why," she wrote later. "I just knew something about Scientology could save me from the mess I was in."

Lisa paid a visit to the Scientology organization in Dallas, then known as the Mission of the Southwest and also called the Center for Personal Enhancement. It was small, with just a few hundred members, but they were a young and enthusiastic bunch. Melanie Stokes, who ran the mission through 1981, had created a positive environment; she described the membership as "a big life-coaching group." Every night brought new prospects: friends of current members and random young people who'd found out about Scientology or Dianetics from a street recruiter.

During the late 1970s and early 1980s in Dallas, Scientologist "volunteer ministers," as proselytizers were called, handed out Dianetics leaflets and free personality tests at clubs, on college campuses, and in hospitals. Steve Hall, a Dallas Scientologist who would later work at the church's International Base, first found out about Scientology from a flier handed to him at a Rolling Stones concert. Hall wound up joining and was a regular at the mission in the early 1980s. Unlike the more regimented atmosphere at the Scientology orgs, the mission fostered a spirit of fun and experimentation. Nights and weekends were its busiest hours; free lectures and auditing demonstrations occurred frequently as did larger events like the annual Halloween party, which featured dancing, live music, and "plenty of beer," according to Hall. Among those who joined the mission were several members of a local rock band, some businesspeople, a scientist, students from Southern Methodist University and other local colleges, and many other kids in their twenties who, as Hall recalled, "just came to hang out. It was a happening place."

Lisa McPherson fit right in. "She was a ball of fun," said Greg Barnes, who was Lisa's registrar in Dallas. "She was funny, she was exuberant, she was excited, she was humble-she was a great person." But Lisa was also unaware of what Scientology would require of her, he said. "Was she naive? No. But did she know what she was getting herself into? No way. None of us did."

The path from neophyte to committed new member of the Church of Scientology is standard, beginning with the personality test, called the Oxford Capacity a.n.a.lysis; its serious-sounding name has led some members to a.s.sert, mistakenly, that it was developed at Oxford University. Next comes an introductory lecture and auditing package to explain the basic principles behind Dianetics and Scientology. After that, prospective members with a drug history are required to undergo the Purification Rundown, the holistic detoxification program Hubbard created in 1979 to cleanse the body of impurities, leaving a person in a "clean" state that makes him or her more receptive to auditing.*

In August 1982, Lisa, having pa.s.sed through these preliminaries, arrived at the first stage of the so-called Bridge to Total Freedom: Life Repair, which is tailored to address whatever crucial difficulties a candidate for membership is having in life. Lisa's major difficulty-her "ruin"-was her relationship with her husband, which she hoped to improve. Lisa's church counselors saw things differently: they believed her best course would be to leave Don, who was skeptical of Scientology and suspicious of its costs.

Barnes and other staff members laid out their case. What was best for Lisa, they said, was for her to stay in the church and handle the situation with her husband, who was quite clearly a Suppressive Person. To make sure that Lisa understood just what that term meant, Barnes sat her down with Scientology's Technical Dictionary to look up its definition, directing her to Hubbard's statement that a Suppressive Person would "automatically and immediately ... curve any betterment activity into something evil or bad." The implication was that Don Boss fell into this category, and what was truly dangerous, Lisa was told, was that being connected to such a person made her a Potential Trouble Source, or PTS, which was someone susceptible to all kinds of physical and psychological illnesses. To lead a happier life, Lisa would have to free herself from Boss's suppression-and any other suppressive forces in her life-by either changing his mind about Scientology or disconnecting from him altogether.

Over the next several months, Lisa underwent a PTS Handling, a program Hubbard designed for members who are "roller coastering," or experiencing ups and downs or simply having doubts of one sort or another. She searched deep within herself to find her own flaws, and during the spring of 1982, she wrote extensive confessions-known as "overt/withhold write-ups." In these reports, she noted every s.e.xual dalliance, flirtation, or "perverted" thought or act she'd ever committed, and with whom: pool boys, neighbors, friends of her brother's, a cousin of her husband's.

Prompted by Greg Barnes, Lisa also wrote an affidavit attesting to Boss's criminal history. "I was never informed as to exactly what was said [to him]," Lisa later recalled. "[But] the next time he phoned [the mission], one of his crimes was read off to him and he never contacted the mission again." After a year of this work, Lisa disconnected from Don, and the couple divorced. "Lisa was in an abusive relationship and we basically helped her end it," said Barnes.

Now liberated, Lisa was determined to follow the path toward self-improvement. Her first step was to enroll in a course whose purpose was to teach students how to study; according to her Scientologist friends, it would enable her to learn anything with ease. Lisa had always done well in school, but L. Ron Hubbard wrote that even the best students often didn't fully grasp what they were studying. They might find they'd read an entire page, or even an entire book chapter, without remembering it. They might suffer headaches or feel tired. While many people attributed this to boredom or distraction, Hubbard explained that all of these symptoms, and many others, were caused by three distinct blocks: the "lack of ma.s.s," or absence of physical examples to ill.u.s.trate the subject being studied; "too steep a gradient," or moving to the next phase of study before the previous stage had been mastered, which could result in the feeling of being overwhelmed; and "the misunderstood word."

Originally conceived of in the 1960s by Charles and Ava Berner, Scientologists and teachers in California, "study technology" was co-opted and launched by Hubbard as his own during a series of lectures he delivered at Saint Hill in 1964. Over the years, it would become Scientology's main form of indoctrination and a central facet of the church's ongoing strategy to use what, in a mainstream context, might seem valuable, or even progressive,* to draw people deeper into Scientology's alternative universe. It was based on three principles: students learn at their own pace, use physical examples-pictures, marbles, or clay models-to help work out complex concepts, and need to focus intensely on vocabulary, never skipping an unfamiliar word without looking it up in the dictionary. Anyone who wanted to move up the Bridge was required to master study technology, which was defined to Scientologists as a method of "learning how to learn."

At the Dallas mission, students busied themselves with studying what seemed to be ordinary concepts like affinity or communication, and then with modeling them in clay, a process known as a "clay demo." To make sure they understood every word and concept they read, they were instructed in a process known as "word clearing," which entails relearning the definitions of even basic words, such as a or on. There are nine distinct types of word clearing, some done with an E-meter, some without; the most rigorous is called "Method 9," or M9. This required students to work with a partner, reading aloud from a book or, more often, from Hubbard's policies, in alternating paragraphs. Each time one partner blinked, twitched, yawned, or simply misp.r.o.nounced a word, the other was required to stop, yell "Flunk!," and instruct the person to go back and find the word he or she didn't fully grasp, look it up, and then use it in sentences until the partner felt the confusion had been "cleared." Then the partners would resume reading aloud.

Some critics of Scientology maintain that study tech, particularly its word-clearing and clay-demo processes, is harmful, as it essentially breaks down the entire semantic and thought structure of the individual, reducing a person to an almost childlike state. Lisa, however, loved her Scientology studies. She felt smarter, more competent. To her friends, she expressed a sense of being in control for the very first time in her life. Scientology was an adventure, and the people she met through the church were bright, friendly, easy to talk to, and united in the sense of being on a mission of self-discovery. "n.o.body else that [Lisa] knew of with the exception of the woman that she worked with was involved in Scientology," said Carol Hawk. "Her family was not aware of what Scientology was ... and to be honest, I'm not sure Lisa was either. At that point, she was very young, and she was very excited about the process of learning about it, and feeling like she was doing something for herself."

Lisa began spending long hours at the mission, forgoing personal pastimes like country-western dancing, once her favorite activity. She stopped drinking and smoking pot; she also left off attending parties and family functions. Her vocabulary changed. People were "terminals." Cars, houses, clothes, jewelry, and other physical or material goods were "MEST"-matter, energy, s.p.a.ce, and time. A person with a positive att.i.tude was "uptone." Someone who worked hard and did well was "upstat." She was a "thetan," and her life was not singular-she had lived many lifetimes, she informed her old friends.

Lisa's odd behavior worried Hawk. "I would say, 'Who are these people, these auditors? They're not psychologists, they're not doctors ... what happens if you're in this auditing session and this person who has no formal training gets you to a place that you can't handle?"

But Lisa was sanguine. "Oh, they know how to handle any kind of situation. They know exactly the right questions to ask."

"It got to the point where we weren't really communicating because you are just kind of looking at her thinking, 'What are you talking about?'" Hawk recalled. One by one, friends drifted away. By 1984, virtually everyone left in Lisa McPherson's life was a Scientologist.

Fannie McPherson, widowed in 1985, worried deeply about her daughter's growing involvement with Scientology. A lifelong Baptist, Fannie, who'd stopped drinking and had joined Alcoholics Anonymous in the late 1970s, had initially been thrilled when Lisa came home in 1982 and announced that she'd joined a church. But as she watched Lisa spend less and less time with her friends and family and more and more money on Scientology, her anxiety grew.

Lisa, Fannie knew, fervently believed that L. Ron Hubbard was a savior. She wrote letters to the Founder. She referenced Hubbard's sayings on issues ranging from stress at work to more abstract notions such as "truth." Lisa tolerated no dissenting opinions, no criticism. She refused to read the newspapers or watch the news. When, in December 1985, CBS aired an episode of 60 Minutes that presented an investigative report on Scientology, featuring interviews with recent defectors from the church, Lisa said it was "entheta," or harmful to her spiritual well-being, and she declined to watch.

The defectors featured on this broadcast, and in other stories like it, were for the most part people who'd joined Scientology in the 1960s as part of a spiritual quest, as Jeff Hawkins had. Lisa McPherson had come to Scientology out of desperation-she later said she'd joined the church to help her "get loose from the criminal psychotic I was connected to," Don Boss. "I think Lisa saw Scientology as her strength," said Carol Hawk. "She had done well there, she felt better. Whether there were any larger concepts of doing wonderful things for the world, I don't know ... but I know that she felt very strongly that it was what was going to make her whole."

And, by all appearances, it had. Lisa found a community at the Dallas mission, where she began working part-time in 1983, helping administer personality tests and volunteering at church phone drives and fundraising events. In the goal-oriented environment of the organization, Lisa's energy and sales talents were appreciated, and she made scores of new friends, including Bennetta Slaughter, one of the most prominent Scientologists in Dallas.

Slaughter, a tall, handsome woman with a cascade of wavy dark brown hair, had an unmistakable air of power-or what Scientologists call "purpose." She and her husband, a Scientologist and successful businessman named David Slaughter, were partners in a brokerage firm called the Atlantic Financial Mortgage Corporation. Dallas, the center of high-tech industry in Texas, was in the midst of a real estate boom, and the Slaughters by every account made a killing during the mid-1980s. They bought a house in suburban Plano, one of the wealthiest communities in the United States, and became prominent on church boards and committees. Scientology has always moved prominent donors up the spiritual ladder more quickly; the high-status Slaughters rocketed to the top of the Scientology food chain. Before long, they were Operating Thetans.