I saw Cenk Uygur on The Young Turks talking about Howard Schultz. “To be fair to Starbucks, they are pretty progressive as a company — among the more progressive companies. They do a lot of good in the world including being decent to their farmers. That was why I was excited to see what Howard Schultz was going to bring.” He then goes on to note that Schultz seems only to be running in order to keep his taxes low.
But is Starbucks really progressive? And if it is, should it get credit for it?
Starbucks Is Progressive in Easy Ways
Compared to other corporations, Starbucks is progressive. But this isn’t the way to look at it. Let’s start by looking at how the company is progressive. It isn’t economically progressive. That’s what we are seeing from Howard Schultz. He’s all for being nice to minority groups — as long as it doesn’t cost him anything. And we see that with Starbucks itself.
Much is made of the fact that Starbucks pays above minimum wage. But to a large extent, this is necessary based on the quality they require from their workers. And they don’t pay that well. The average wage of a barista is $9.77 per hour — hardly a living wage. Hell, a store manager makes $17.44 per hour, on average. That’s $35,000 per year — just over the level that would qualify a family of four for Medicaid.
Store manager! Each store nets roughly $100,000 per year. Each store employs roughly 8 people. Just saying.
Progressivism as Branding
We need to think about branding. A big part of Starbucks’ brand is being enlightened. That’s because its consumer base is that vague economically moderate, socially liberal crowd that refuses to shop at Walmart.
Okay, that’s an overstatement. Their customers are generally urban professionals. There are lots of Republicans who go to Starbucks — but generally not the kind who are proud Trump supporters (but many of them doubtless do support him because he’ll keep their taxes down).
Is it any wonder that Starbucks has been what I think of as an MSNBC liberal: socially liberal and economically “I’m against economic inequality as long as we don’t do anything about it!” conservative? So Starbucks’ progressivism is the kind that would never get in the way of profits or the wealth of billionaires.
So Starbucks isn’t very big on the economic liberalism — the kind of liberalism that would actually cost them a lot. And when it comes to social issues, I doubt they lose anything. Call it part of the advertising budget, given how much good media they’ve gotten for it.
Regardless, I’m sure there are smart people at Starbucks who have worked out that every liberal thing the company does pays for itself in customer goodwill.
Starbucks Can Afford to Be “Progressive” — For Now
But none of this matters. Nicole Aschoff explains what’s going on in her great book, The New Prophets of Capital. Companies that don’t have much competition generally play the “socially responsible” role. It actually works great for the rich because when idiots like Howard Schultz decide they should be in charge, they can say, “We don’t need higher taxes! We just need companies like Starbucks and Whole Foods who treat people well!” But that doesn’t work.
Whenever a “liberal” company has faced competition, the first thing they do is to jettison their pretenses of liberalism. They know that branding will only take them so far and if a competitor is charging less, the competitor will win out.
So when a major coffee shop challenges Starbucks, watch as it turns into Walmart. As it is, they are already one of the top companies with employees on food stamps.
The Talk vs the Policy
There is a schizophrenic aspect to this. We have business leaders, on one hand, telling us that all we need is for corporations to be socially responsible and all our problems will vanish. And on the other hand, we have business leaders telling us that the only purpose of a corporation is to make money for shareholders. It doesn’t take much clarity to look at the world and see which side is telling the truth.