March 28, 2008

AEY's Awful Afghan Ammo: Is it an affirmative action scandal?

This is one of those blog posts where I start writing about one thing and in the middle of it, I discover something I never expected, so the whole thing lurches off in a different direction. I apologize for the lack of pre-planned structure.

In the wake of the NYT's story on 22-year-old high school-dropout Efraim E. Diveroli, who snagged $202,000,000 in U.S. government ammunition contracts in Fiscal Year 2007 to supply bullets to the embattled Afghan government, many people are wondering how the federal government could have handed out such a big contract to some loser who has been arrested twice in his young life: for drunk driving and for beating up a parking valet.

You would think that somebody in our huge federal government might want to do some background checks on the Internet. For example, the only job Diveroli has ever held besides working for his dad Michael Diveroli was working for his uncle Bar-Kochba Botach's weaponry shop, Botach Tactical, in South Central LA. So, what kind of lessons did young Efraim learn working for Botach?

Here, unedited, is just the first page's worth of customer reviews of Botach Tactical on

Botach. Great Prices, Horrible Customer Service.
Shop elsewhere. Poor customer service. NOT WORTH THE AGGRAVATION !
One word "Agonizing"
Please investigate this company on the Internet before purchasing anything!
painfully awful. the WORST customer service you can imagine
Extremely frustrating and disappointing
Worst Customer Sevice Experience EVER.
My order was just forgotten
Cut out the middleman and just flush your money down the toilet.
Worst Shopping Experience Ever!!!
service and trust, I rate them at minus 90
Worst Customer Service Around

But, maybe the Feds aren't supposed to look at Botach Tactical's performance because the firearms dealer has, according to

Certificates: Small Disadvantaged

In other words, Botach Tactical gets affirmative action in government contracting! Indeed, much of its legitimate business is done with law enforcement and military buyers. (Leaders of the South Central LA black community suspect it might also do business with less reputable locals, but that's another story.)

In fact, young Efraim's AEY.Inc is listed in, as Mike Carney at USAToday noticed, as:

Small Disadvantaged Business: Yes

Does that explain how a loser like him got $202 million in contracts?

And why is Efraim Diveroli's ludicrous little company certified as "Disadvantaged?"

Because he's a Hasidic Jew. Or at least he claims to be on this federal form. (Efraim's cousin, Michael Jackson's favorite rabbi Shmuley Boteach, the son of the owner of Botach Tactical, started out as a Lubavitcher Hasidic rabbi although he seems to be more freelance today.)

In fact, I just learned, all Hasidic Jews, such as the Botach/Boteach/Diveroli clan, are eligible for federal ethnic preferences! I had no idea ....

An alert reader pointed out in the comments to an earlier post this old NY Times story:

Reagan Grants Hasidim 'Disadvantaged' Status
New York Times, Jun 29, 1984

They were talking about it in the Crown Heights section of Brooklyn yesterday. Bearded men in dark coats under a hot sun, men known for their deep spiritual values, their belief in education and hard work, their pride in self-reliance.

They were all Hasidic Jews, and they were talking about President Reagan's decision, announced Wednesday, to add them to a list of minority groups considered ''disadvantaged'' by the Government.

The list already includes Hispanic people, blacks, Indians and other groups that are considered by the Government to have encountered severe economic problems because of discrimination.

The designation means the Hasidim are able to apply for Federal assistance in running businesses. They will also be eligible for programs that set aside work for minority-group businesses.

Holy cow ... affirmative action?!? Is that why the Syrian Jews of Brooklyn have gotten so rich?

An reviewer of a book about the Hasidic Satmars of Williamsburg notes:

As a result of their low level of education and literacy, Satmar hasidim, to a much greater extent than most Orthodox Jews, fit poorly into the modern economy; professional jobs are of course off limits. According to the author, 1/3 of Williamsburg Hasids have incomes below the poverty line, and the median Jewish income in Williamsburg is one half the median family income in New York City (which in turn is below the median family income for NYC suburbs). In several parts of the book, the author goes out of his way to brag that in 1984, the Satmar were "offically designated a disadvantaged minority" by the U.S. Commerce Department (by which I assume he means that they are eligible for easy access to federal contracts under affirmative action regulations - though the author is not very clear about this). In fact, he states that this decision was "the most significant factor" in "the development of the entreprenurial spirit" among the younger hasidim. Somehow I find it troubling that a community can, by undereducating its members, become voluntarily poor and then gain "affirmative action" protections that were intended for communities that become poor through discrimination.

Here's former NYC mayor Ed Koch's statement of disbelief that the Reagan Administration made Hasidic Jews an official disadvantaged group.

I'm not real clear on just what affirmative action goodies Hasidim are eligible for as a disadvantaged minority -- clearly, they can get help from the Minority Business Development Agency, but I'm not sure what else. If you know, let me know.

Despite, or perhaps because of, their Commitment to Service and Federally-Certified Ethnic Disadvantage, the Botach / Boteach family of LA is wildly wealthy. Luke Ford points out today:

This Week The Botachs Married Off A Daughter At The Century Plaza Hotel

I’m told there were 800 guests for the wedding of the daughter of Shlomo and Dalia Botach. Shlomo is Yoav’s brother. The daughter is [celebrity rabbi] Shmuley Boteach’s cousin.

How do they afford it? The Botachs own much of downtown Los Angeles. They live under the radar in the modest Pico-Robertson neighborhood. They send their kids to Hillel and YULA and get scholarships because of their large families. No one dreams of the vast amounts of money this family accumulated. Yoav (Shmuley Boteach’s father) is the largest owner of warehouses in California. Rumored to be Israelis, their roots are Iranian. [More]

The Century Plaza is the big Hyatt Regency hotel in Century City, right next door to Beverly Hills. Their wedding reception package starts at $132 per guest, so that's six figures right there.

So, this whole story may be another affirmative action scandal, rather like crooked defense contractor Wedtech in the 1980s, whose Italian-American boss qualified as Hispanic because his parents had lived for awhile in Puerto Rico. Clifford D. May wrote in the New York Times in 1987:

One important aspect of the Wedtech case is that the Bronx-based company, which declared bankruptcy late last year, was in a position to benefit greatly from political influence because it was owned by a member of a minority group. Under Section 8(a) of the Small Business Act, such companies may receive Government contracts without going through the process of bidding against competitors, and Wedtech did so to gain most of its $100-million-a-year business.

Wedtech's minority status was based on the fact that its founder, John Mariotta, was Hispanic. Mr. Mariotta -the name is Italian - was born in New York, though his parents came from Puerto Rico.

''This is an issue that troubles me,'' said Senator Daniel Patrick Moynihan, the New York Democrat who has been involved in minority issues for more than a generation. ''After all, there were slave-owning families in Puerto Rico in the 19th century. Do individuals from those families, too, qualify as disadvantaged minority group members?''

In any case, the company somehow kept its privileged status even after it went public in 1983.

The thorniest problem lawmakers face is that in the absence of competitive bidding, a minority-owned company must depend for its contracts on political influence and the subjective perceptions of those with a hold on the Government's purse strings. That, in turn, can open up broad opportunities for corruption.

Of course, what's the real scandal with AEY is that it's not a scandal for Hasidic-owned firms to claim affirmative action breaks.

My published articles are archived at -- Steve Sailer


Anonymous said...

This kills the "just another government scandal" meme.

This is (another) case of some members of the Jewish community abusing a generally sympathetic public by taking advantage of misplaced kindness.

There is no legitimate reason these people should be on this list of affirmative action candidates and they should be removed as such immediately.

Anonymous said...

Ateret Diveroli is the mother of Efraim Diveroli and is the sister to Shmuley Boteach. Thus Michael Jackson's rabbi is the uncle of Efraim.

Why did Michael Diveroli stop working for Botach Tactical? Well, he divorced his wife....which makes it hard to work for one's brother in law.

Anonymous said...

If we are going to be wasting public monies on the Middle East "Peace Process" (excuse me while I fall out of my chair laughing, ahem), we might as well let some sleazy Americans get a cut so they can siphon off some of that money back into the US economy.

Do people still get to call themselves Hasidic if they are non-observant? I guess the Federal Government doesn't care if it's an ethnic not religious qualification.

Anonymous said...

this is not even close to the fiasco that is the department of housing and urban development.

that's a CABINET level department where BILLIONS disappear every single year.

the federal government could cut it's size in half and nobody would notice.

don't even get me started on "hispanic". creating that fake category will cause major problems in the future.

Anonymous said...

I dugg this blog post here

This would be like Mitt Romney (except they have MORE money than Mitt) getting preference in bidding because he is a Mormon.

Anonymous said...

Question for those who know more about blogger than I do: Is it possible to have the same comments page associate with multiple posts? Because Steve has written about four posts on this same subject in the last 24 hours, and it would be nice if he could set it up so they all went to the same comments page.

Oh yeah, nice work Steve and Anonymous.

Anonymous said...

filed under 'anti semitism, origins of'

Of course any politician who dared consider revoking this status would be akin to stoking the coals at Auschwitz.

Out here on the East Coast the Hassidim have made plenty of friends: in poor/working class minority towns they have all their homes declared temples so they don't pay property taxes (thats after having their own school district within the town) so the other townspeople have to pick up the tab and they cannot of course even enjoy so much as Christmas tree in public..

and lets not forget the crown heights riots when one hit a black kid with a car a hassidic ambulance whisked him away and left the black kid to die.

oh did I mention amublances - they have fake ones they use to ignore traffic and skate past cars during rush hour.

Can't imagine why people hate them, i mean, why them?

Unknown said...

There is no legitimate reason these people should be on this list of affirmative action candidates and they should be removed as such immediately."

There is no legitimate reason for ANY KIND OF AFFIRMATIVE ACTION. It's an invitation to corruption & scandal.

I wonder if the Diveroli family is Albanian. Italian Jews are, if Northern, educated and intellectual. If Southern, they are poor but honest. I think they may have migrated (like other Italains) to Albania, and picked up the local habits.

Hasidim are virtually all Ashkenazi. Something here doesn't add up. Let's keep digging.

Anonymous said...

You guys are too tough on this family. His grandmother was a Holocaust survivor. So, back off:

Angelo Diveroli, who immigrated to the U.S. from Rome after World War II, said his grandson came from an upstanding Jewish family that encouraged him to study his faith as well as weaponry. Efraim Diveroli had attended a yeshiva, an Orthodox Jewish school, in Jerusalem.

The elder Diveroli had seen his family in Italy persecuted during the war. His wife was a Holocaust survivor from Poland. "So, you know what kind of family we come from," he said. "We're not a family of gangsters."

Anonymous said...

According to Wikipedia, the Satmar Hasidim are anti-Zionist (they think the Jews should have waited for the Messiah to give them back Israel, and not fought for it) and, ironically, refuse to accept any government aid from Israel.


Anonymous said...

Affirmative action is simply a scandal in toto. The Jewish ownership of AEY is irrelevant. Affirmative action should be done away with -- for everyone. That it will be taken advantage of by opportunistic people is an inevitability given the distorted incentives it presents to people.

Razib Khan said...

re: the syrian jews, i think they'd fall under the camp of 'modern orthodox,' though as sephardic jews the ashkenazi flavored terminology doesn't apply easily. also, not all non-modern orthodox are hasidic, some are non-hasidic (many of the litvak jewish communities). finally, the peculiar SES numbes for hasidic jews are not because of exogenous structural constraints, but a conscious choice by the community to separate itself from mainstream american norms & values.

Anonymous said...

I would not be surprised if Ronald Reagan knew what the outcome would be when he gave them disadvantaged status. He probably figured it would take 30 years or so before the whole AA mess could be dismantled.

Anonymous said...

"filed under 'anti semitism, origins of'"

You should file it under 'anti-semitism', consequences of'. Had anti-semitism not forced the Jews into the disarmed ghettos Sailer mentioned, they could have walked around with swords and learned to be as polite as your average European Christian soccer fan.

Anonymous said...

I spend some time in Lakewood NJ (home to the largest rabbinical college in the US) and also in the hospitals that serve that population. Many of the women having babies are on Medicaid or NJ Family Care because their husbands are rabbinical students for years. Offsetting that expense to the taxpayers, they send their children to private schools

I admit to a sense of envy of their community when I see the families on the street - the solidarity of ethnicity, religion, culture, purpose and values is palpable there.

Unknown said...

Juan (et al),

Satmars are one type of Hasidim. The Botach/Boteach family are part of the "Habad" movement -- although it appears that sexy Shmuely has broken with them, precisely over the issue of mixing with gentiles, and not Hassidics.

OK, it seems the Diverolis are Roman; so bag the Albanian theory.

One note: the Diverolis themselves are not Hasidic. One look at Efraim proves that. In any case the Roman Jews are not Hasidic. Hasidim are Ashkenazi - Eastern European by definition. And they don't marry out, except for some Chabad types - who are unusual in that way, because there are so many "returnees" to Orthodox Judaism among them.

It gets kind of complicated.

Anonymous said...

Like I said in another post, the only government small business contracting set aside in the whole racket not close to meeting its quota is Service-disabled Veteran-owned.

That's basically the only one for white guys, and implies actually having done something (having a military caused disability), and not just receiving a handout. Go figure.

Anonymous said...

Anonymous: In fact, I believe that they not only oppose Israel but have been known to associate with pro-Palestinian groups. Or maybe that's a different anti-Zionist ultra-Orthodox group.

Anonymous said...

Yeah, AA is a bad policy all around. But the one case where you can almost see it is for American blacks, especially in the 70s, when there was a lot more immediate history of genuine bust-their-heads sort of legal racism. The problem is, once we accepted it for this one case (still a bad idea, but kinda understandable), it had to extend to everyone. The policy intended to more-or-less compensate some guy for keeping his great grandfather picking cotton under a whip, and keeping his dad from voting or getting a decent education, instead ends up "compensating" some guy whose parents immigrated from Mexico or Europe to get away from poverty or genocide at home, even though the US either had nothing to do with the problems or actively helped fix them.

And once the programs are in place, they're classic interest group operations. There's a group that knows who it is, and that benefits $X from the programs, and that group is willing to spend $X-1 to keep the programs in place. And is also willing to call people the nastiest names imaginable to keep the programs in place. It's easier to get rid of nuclear waste than a government program with a self-identified group that knows it relies on that program and is willing to fight dirty to keep it. (Just ask the next farmer you meet.)

Anonymous said...

Dollmaker: "You guys are too tough on this family. His grandmother was a Holocaust survivor. So, back off:"

Im sure you are familiar with the term 'get out of jail free card'.

Im just wondering how many generations the 'holocaust defense' applies for. Is there some sort statute of limitations? Will my grandchildren be ripped off and have to let it go because the criminal has a great great grandparent who survived the holocaust.

And of course Grandad Diveroli would never lie about such a thing, not being from such an upstanding family. Oops best lay off him, he is a holocaust survivors husband after all.

Grandad Angelo Diveroli is 72, does anyone know how old Grandma Diveroli is?

Anonymous said...

Dollmaker: "You guys are too tough on this family. His grandmother was a Holocaust survivor. So, back off...."

I thought you were joking at first. But you're not. That's scary.

Let me say this as simply as possible: EVERY living Jew is a Holocaust survivor. And that fact has no moral implications for us.

Anonymous said...

That [AA] will be taken advantage of by opportunistic people is an inevitability given the distorted incentives it presents to people.

That's a mutation of the old liberal saw, "there's good and bad in all groups."

Um, yeah, but around here we want to know how much.

Where's the WASP AA? (and by that I don't mean to imply there is none; find it and show it to us)

Anonymous said...

You should file it under 'anti-semitism', consequences of'. Had anti-semitism not forced the Jews into the disarmed ghettos Sailer mentioned, they could have walked around with swords and learned to be as polite as your average European Christian soccer fan.

Sailer's theory doesn't hold water; Middle-Easterners generally display the same traits he attributes to Jews. They brought their baggage with 'em.

And Jews created the ghettos themselves. It's astonishing to me how this isn't obvious to everyone (Israel, anyone?).

As for disarming them, well, that's the price paid by (uninvited) guests; the Israelis don't even let in guests.

Anonymous said...

svigor: I'd say there's something like AA for wealthy, powerful people (networks of connections that get you into jobs/internships/schools, legacy admissions, friends of the family that will make your life easier in some jobs, etc.), and that at one point this was largely benefiting WASPs. But never exclusively, and that group has plenty of Jews, Catholics, Asians, and a fair number of blacks and hispanics and what-have-you now. Obama's kids will have advantages that my kids will never have, by virtue of who their parents are and who they'll grow up knowing.

Anonymous said...

I'd say there's something like AA for wealthy, powerful people (networks of connections that get you into jobs/internships/schools, legacy admissions, friends of the family that will make your life easier in some jobs, etc.), and that at one point this was largely benefiting WASPs.

But all ethnic groups do this, and WASPs seem to do it less than most. But the whole point of AA is that it's state-sponsored; where are the WASPs taking advantage of AA?

After all, "all groups do it (take advantage of AA)," right?

Anonymous said...

A heavily armed soceity where everybody's packing heat is usually going to be a gang society (like Somalia).

You make a decent point, but let's all own up to the fact that blacks in general are not capable of responsible firearms ownership. This is at the heart of the American "gun violence problem."

Anonymous said...

Do Sephardic Jews (which includes Syrian Jews) get affirmative action as well ?! They are by definition descended from Spain. That includes a lot of Jewish Americans.

The extract below is from a link in your post:

Overview of Affirmative Action: Hearing Before the Committee on the ... By Hank Brown

-- Ed Koch's Prepared [written] Statement, [not his oral statement] before Congress 1995. [the 'mend it, don't end it' Clinton era that did neither]

"... My position that affirmative action, with its quotas and exclusionary impact, is wrong and bad for our nation goes back 20 years to my days in the House of Representatives. I would like to recount an incident that occurred there that resonates today.

I was a member of the Banking and Currency Committee. I received mail Chasidic Jews complaining that they were ineligible for funding from the SBA program providing set-asides for blacks, Hispanics, Asians, Aleuts and Eskimos. I thought perhaps they were singled out for discrimination because of their clothes and lifestyle to a greater extent than other Jews. They also pointed out the *** ludicrousness of the SBA regulations, which allowed Sephardic Jews descended from those Jews exiled in 1492 from Spain and still bearing Spanish surnames to be eligible *** under the special program created for blacks, Hispanics and other minorities, while Jews, as a minority, were not.

Initially, I thought I should simply seek to expand the definition of eligibility to include all Jews, not simply Sephardic Jews. I quickly dismissed that approach as unfair to non-Jews.

I decided to challenge the concept of a government program which excluded people on the basis of their race, in this case, excluding whites. In my 1981 book, Mayor, I described what happened: ...?"