Why Starbucks' CEO Wants to Freeze Campaign Contributions

Tuesday, October 04, 2011

Welcome to Politics Bites, where every afternoon at It's A Free Country, we bring you the unmissable quotes from the morning's political conversations on WNYC. Today on the Brian Lehrer Show, Starbucks CEO Howard Schultz urged other corporate execs to stop making campaign donations until Washington starts working together to repair the economy.

Why dry up donations?

Howard Schultz is asking CEOs to take the money they would donate to political campaigns and instead donate it to his Upward Spiral campaign. Upward Spiral would create a fund that provides credit and loans to small businesses hoping to get off the ground, Schultz said.

The idea works on two fronts, the first of which is that withholding from politicians might engender more cooperation in Washington. Schultz said recent events have made it clear that the current state of partisan politics is untenable and destructive.

Most Americans watched with profound disappointment when congress was uanble to reach a bipartisan debt ceiling deal about a month ago. That resulted in a crisis of leadership and a crisis of confidence in America, and as a result of that I just thought, this is a moment in time where we can't rely on government and wait for government; but business leaders and corporations should in some way come together to send a signal to washington that we no longer want to embrace the status quo.

'The lifeblood of small business'

In addition to affecting political change, Schultz's idea is also supposed to work on the job creation front. Instead of contributions to bickering, how about contributions to business? Schultz said the Upward Spiral program would give something to small businesses and start-ups that big banks and the government itself aren't willing or able to provide.

The lifeblood of small businesses is access to credit, and we know that small business is the driving force of employment in this country. With 9.1 percent unemployment and no access to credit, we've got to make a change.

Balancing profits with conscience

Schultz stressed that business could play the kind of humanitarian role that many people want the government to fill. He was optimistic that an economic recovery was possible, but also that a new breed of benevolent corporations could come with it.

The gap between the haves and have-nots is widening. The amount of revenue that state and local municipalities have is going to cut social services in America, and this is why it's so vitally important for corporations to recognize that their pursuit of profitability as a singular goal is quite shallow. It needs to be balanced with a social conscience.


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Comments [29]

This will be buried far down in the list, but I agree with some of the comments here. The Upward Spiral is SUCH A great movement... but the irony of Starbucks touting it as a cause is ridiculous. Perhaps they are saying, we support upstarts and local business, as long as they aren't in our industry.

I am writing from Salt Lake City, Utah... not exactly what people consider the coffee capital of the world, right? It's predominantly Mormon (LDS) here, but the underground that exists is VERY adamant - and surprising for most people. The local coffee shops here have struggled to survive- and close to our home, we literally watched a wonderful shop run by a wonderful gay couple be run out of business as Starbucks opened not 100 yards away with an expensive storefront and stole their business away. It's awful, I don't go to Starbucks, I don't shop at Walmart.

Mar. 27 2012 11:44 AM
Geri Stengel

This is what it takes: People who care and are willing to invest in the future.

Oct. 05 2011 08:55 AM
Jan Riese

I hate your new format for listening on the web. You cannot rewind in case you missed something. You are making an extra step which takes longer. You cannot see the comments other people left. I hate it. I hate it. Why did you make listening on the internet worse!!!

Oct. 04 2011 03:25 PM
JK from USA

I love Starbucks, but if they want to really help the economy, maybe they could contract out with American factories to make all of their mugs. Starbucks sells more than just coffee and I think that for them to sell only American-made products in their stores (mugs, espresso shot glasses, travel cups, etc.) would not only set an example and send an important and strong message, but would actually directly contribute to adding jobs beyond hiring baristas.

Oct. 04 2011 02:51 PM
jgarbuz from Queens

Truth-telling? Nobody in America really wants to hear the truth! Here is the truth. 4% of the world's population cannot forever consume 20% of its resouces, or produce 20% of it production forever either.

The truth is, our standard of living WILL fall, and no protests or bellyaching is going to change that fact one iota!

If people who to blame or scapegoat, let them look in the mirror. Did they borrow money? And if so, did they think about what would happen if they could not pay it back? That's the problem. The country has been living on growing mountain of debt until it came crashing down, and it hasn't finished crashing by a long shot!

IN the past, when countries got poor, many people emigrated to places like the United States. That was one personal solution to poverty back then.

Oct. 04 2011 10:54 AM
Katie from Brooklyn

I'm a fan of the Upward Spiral movement, but I have to speak up for the mom and pop coffee shops that Starbucks did run out of town in the 90's. It is not a myth, as Mr. Schultz claimed. The two I specifically remember were Zopie's and No Borders No Boundaries in Syracuse. Starbucks moved in, and they shut down literally overnight. I remember.

Oct. 04 2011 10:54 AM
Sophie from Poughkeepsie, NY

Yep, it's easy to feel "optimistic" when you're not suffering sleepless nights trying to figure out how to stretch that dollar until next week.

Oct. 04 2011 10:53 AM

Thanks for this segment, Brian. Now I know that it's not the message; it's the messenger. Sorry Schultz, you're just not the right guy.

Oct. 04 2011 10:53 AM
J Reilly

I don't know what Mr. Schultz was into in 1971 but we had little coffee shops all over Long Island and they were places where the community converged and gossip flew. Maybe there weren't any in Seattle. That could be why he thinks there weren't coffeeshops anywhere.

Oct. 04 2011 10:52 AM
daniel from nyc

This just proves our governement is bought by corporate interest, when business activism is cutting off the campaign donations. Why don't they just stop donating to our corrupt politicians all together and let the people have the government back. They have an agenda.

Also, why don't they get active about the obesity problem in america and stop selling 2500 calorie milkshakes under the guise selling coffee

Oct. 04 2011 10:49 AM
Hank from Nyc

How can they fix anything if they cant even make a decent espresso?

Oct. 04 2011 10:49 AM

I love what this guy is saying, but I can't stand the coffee (or tea for that matter), sorry. If, but if they start selling dunkin' donuts coffee at Starbucks, count me in.

Oct. 04 2011 10:49 AM
daniel from nyc

This just proves our governement is bought by corporate interest, when business activism is cutting off the campaign donations. Why don't they just stop donating to our corrupt politicians all together and let the people have the government back. They have an agenda.

Also, why don't they get active about the obesity problem in america and stop selling 2500 calorie milkshakes under the guise selling coffee

Oct. 04 2011 10:48 AM
Sheldon from Brooklyn

Saying Starbucks is driving "Mom and Pop" coffee shops out of business is like saying Apple drove other tablet makers out of business. Heck - they practically created the market for "quality coffee" in North America.

Oct. 04 2011 10:47 AM
Jenna from Hamilton Heights

Does Mr. Schultz see other business CEO's traveling the same path as he is? and if not, why not?

Oct. 04 2011 10:46 AM
Martin Chuzzlewit from Manhattan

This man is a shameless LIAR.....there I said it.

He is trying to dry up funding for any candidates opposed to our anti-business President under the disguise od "bi-partisanship".

What a phony.....small business indeed.....neither he nor Obama care about small businesses. Typical guilty liberal.

Oct. 04 2011 10:46 AM
Leo in NYC from NYC

So to be clear, Starbucks, a company with 11 Billion in revenues last year, is donating 5 Million nationwide to small businesses? And asking corporation to end donations.

Which companies will stop donating? Civic-minded, good-government types — progressive companies. Who won't — the Koch brothers, et al — people who actually want gridlock and dysfunction — Tea Party, Americans for Tax Reform-types.

Even assuming the best intentions, this is nonsense.

Oct. 04 2011 10:46 AM

NASDAQ not part of the problem???

Next, he'll be defending S&P and other ratings agencies.

Can't this man see that he is killing his cause faster than any of us could?

The problem is the very stores he says he's opening. Please stop it!

Oct. 04 2011 10:45 AM
Stan from Montclair, NJ

Schultz wants to cut off any government business regulation. Like Better Business Bureau (set up really to protect businesses from government intervention). Pretend to be socially minded when just worried about manipulating political system so it doesn't effect them. Especially when see uprising beginning to blossom.

Oct. 04 2011 10:44 AM
Michael from Brooklyn, NY

"A myth that isn't true"? Really? So, when they open three Starbucks across the street from each other, keep them open until all the local coffee shops close and then close two of the Starbucks - that's a strategy to encourage small coffee shops to open? Wow.

Oct. 04 2011 10:43 AM
jgarbuz from Queens

So STarbucks now wants to become a bank and lend money to poor people? Good luck with that. I think it's just publicity and another gimmick to take advantage of the present plight.

Oct. 04 2011 10:43 AM

Did he just imply that mom & pops didn't sell coffee before Starbucks came along??? He's losing me fast... even faster.

Oct. 04 2011 10:42 AM
Michael from Brooklyn, NY

I'm not inclined to believe Mr. Schultz is opposed to the status quo when his company has consistently fought against every attempt by his employees to unionize.

I'm open to hearing from him however, on this issue.

Oct. 04 2011 10:39 AM
RL from the bowery

Why a damn Starbucks on every f*ing corner??? Please, please, stop with all the stores!!!

We can not hear your message when you overrun our neighbors with your crappy stores.

Don't you want us to listen to you? We can't! You've ruined any chance of being heard no matter how great the message.

We're not saying go out of business. Just Please, stop with all the Starbucks stores on every corner. Please!

Oct. 04 2011 10:38 AM
Tom from Toronto

Brian - could you please ask Howard Schulz to please comment on the whole issue of Starbucks and the issue of their corporate support (or not) of "Israel".

I am a loyal Starbucks customer, and have found some of my friends bringing up this issue that supposedly Starbucks is an active corporate donor to causes in Israel that hurt the Peace Process.

Oct. 04 2011 10:36 AM
SAMMY from citizen of the world

ask Mr. Schultz how can he justify Starbucks in countries such as Jordan or china pay Starbucks workers similar wages to what they pay in that specific country... such as 1 dollars an hour and charge costumers there the same they charge here such as 5 dollars a drink??!!!

Oct. 04 2011 10:11 AM
Sheldon from Brooklyn

It's about time. I've never understood why Corporations haven't gotten more involved in public policy issues that affect their bottom line like health care.

If it's true that Starbucks spends more on health insurance for their workers than coffee beans, you would think they would be the first in line, lobbying for something like a public option.

Oct. 04 2011 10:09 AM
David from West Hempstead

Has Mr. Schultz considered the possibility that many corporations are paying to effect gridlock? It's to be expected that those invested in maintaining the status quo would make political contributions to keep things as they are.

Oct. 04 2011 10:07 AM
Martin Chuzzlewit from Manhattan

Please ask:
Is Mr. Schultz asking the same of the mega unions? (AFSCME - municipal employees union- was THE SINGLE biggest campaign contributor in 2010.) Or is he just trying to disarm one side, while pretending to be neutral?

Is Starbuck's unionized? If not, is he just doing this to throw a bone to unions and keep them at bay?

Hasn't he been a reliable supporter of Democrats (Patty Murray and others) and wouldn't this pledge of corporations disadvantage Republicans the most?

Warren Buffet Junior anyone?

Oct. 04 2011 09:19 AM

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