The Starbucks Paradox

Kim Fellner looks into the contradictions of coffee, class, and race.

By Kim Fellner Mar 21, 2004

It was November 1999 in Seattle and the U.S. global justice movement had taken to the streets. Suddenly, there was a crash not 20 feet from where I stood, and the Starbucks window collapsed in a hail of glass. “Zowie,” I said to my husband Alec, “I sure hate the WTO and capitalism, but that’s our coffee store.”

I’ve been pondering the contradictions ever since, watching my progressive colleagues devour the latest episode of Friends, gleefully shop for real estate, and sip their lattes. Political ideology notwithstanding, we were avid participants in popular culture and petty capital. How could we so glibly demonize that which we so cheerfully consumed?

And as I went around the country, I couldn’t help notice that both the employees and habitués of Starbucks seemed far more diverse by race and class than the American anti-globalization movement. I wanted to know, was big, by definition, bad? Was Starbucks’ touted commitment to “values” just a cynical ploy to complement

Few people argued that coffee was inherently evil like bombs or SUVs. Rather, Starbucks stood accused of: buying coffee at prices that couldn’t sustain the farmers; purchasing from farms that degraded the environment; causing neighborhoods to gentrify and small cafes to wither; and representing the mega-branding that’s killing small businesses and homogenizing the

I frankly like having Starbucks at the airport, and at strip malls in strange cities. I wouldn’t mind independently-owned coffee shops instead, but Starbucks is usually what’s there. Moreover, progressives have tended to romanticize small businesses; yet many sweatshops in this country have been small, family-owned enterprises, and that didn’t benefit those who worked there. As a rule, racial minorities have fared better in larger institutions. Was Starbucks doing right by race? What

What, specifically, is wrong with this emblematic corporation? And is anything right? It seems to me that the movement is old enough to make some

The View from Headquarters

The mermaid from the Starbucks logo peers coyly from the top of the refurbished Sears warehouse in Seattle that serves as company headquarters. Although one union official claims this is cultishness gone amok, I can’t help seeing it as a humorous and engaging design feature.

The people I meet are also humorous and engaging. They include Paula Boggs, executive vice president, general counsel and secretary; Wanda Herndon, senior VP, Worldwide Public Affairs; David Pace, executive VP, Partner Resources; and Sandra Taylor, senior VP, Corporate Social Responsibility. While they are polished spokespeople for the Starbucks mission and policies, they don’t really strike me as cult material. What does strike me is that three of the four are African American women. Women comprise barely 13 percent of Fortune 500 general counsel and women of color merely 1.6 percent of all corporate officer positions. At Starbucks, more than 34 percent of the top officers (vice president or higher) are women and/or people of color. And although Starbucks is cagey about its statistics, they’re clearly far ahead of the miserable norm. “Certainly, at the top of this company, diversity in the form of race rings loud,” says Boggs, the general counsel. “I would think, fairly, we have some work to do when it comes to middle management, but we’re on the right path. ”

“You will see diversity by age, sex, race, sexual orientation, family status throughout the organization,” David Pace asserts. “It holds an equal place in our guiding principles, just like respect and dignity, just like customer satisfaction.”

Those principles are spelled out in the company’s six-point mission statement, which is central to the way the company defines itself and acculturates its employees. Yet Pace is aware that, “Our guiding statement is probably not that different from people who are involved in scandals. The difference is the commitment to it.”

Making Good on Eighth Street

Tawana Green, a lively 28-year-old African American, Washington, DC native with unruly dreads, believes in the Starbucks mission. She started with the company the same year as the Seattle protests and now, four years later, is the manager of the new Starbucks on SE Eighth Street, two blocks from my home on Capitol

It’s the opportunity Green was looking for. “I’ve been on my own since I was 17,” she relates, “and started work right out of high school. I did the office thing, but found myself sleeping at the computer. So I went into retail where I could work with people.”

She was impressed by the full benefits for anyone working 20 hours or more, almost unheard of in the world of retail. In addition to a generous health, life, and disability insurance package, the company offers: a 401K with a match; Starbucks “bean stock,” which reflects the annual success of the company and is allocated among employees based on hours worked; discounts on Starbucks public stock; and to top it off, a free pound of coffee every

She’s hired a total of 15 workers, and all but one survived the first month. Visiting on different shifts, it’s clear that she’s assembled mostly people of color from the community; they start at $7.50 an hour plus tips, and most of them work enough hours to qualify for the health benefits. Although some Starbucks workers claim they have a difficult time getting those hours, the company says that more than two-thirds of all employees qualify.

As I listen to Green and take in the familiar décor, the comfortable chairs and small merchandise displays, I find myself thinking about what journalist/activist Naomi Klein describes as the branding phenomenon, where what’s on sale is not just a product but an image and a lifestyle: not just coffee, but “The Starbucks Experience.” Klein hates the clone-like nature of the stores and what she sees as the cynical manipulation of the consumer. And I honestly know what she means. Starbucks is putting in a bid to be a Pleasantville version of the village square.

Then I look at Green, her co-workers, and the customers, and it doesn’t look like such a terrible thing. “My goal is to provide a great place to hang out and also give back to the community,” Tawana Green tells me. “I’m not saying it’s easy. But here I am, 28, with a high school education, and I’m a store manager with a piece of the company. Where else could I get this opportunity? It doesn’t get much better than this!”

Uniform Misery

However, for Sandra Evans, an employee at Cintas—the mega-company producing uniforms, laundry, and cleaning supply products with which Starbucks contracts—it doesn’t get much worse. Evans, a 57-year-old African American, works 40 hours a week sorting shirts at the Cintas plant in Aspen, Pennsylvania. She also works 20 hours at the local K-Mart. “I’ve got two jobs, and I’m still struggling,” she wryly notes. “This company is making millions, and people can’t even pay their electric bills.” She loves to walk, entertain, and cook, but “I’m just too busy working.” And while she drinks a cup of coffee a day, she’s never had a Starbucks, “although I hear they’re excellent.”

Driven by grievances of unpaid and forced overtime, discrimination and unsafe working conditions, she and her fellow workers are engaged in a campaign to join UNITE, the Union of Needletrades, Industrial and Textile Employees. Evans is also among a group of workers who recently filed an EEOC class action complaint against Cintas for gender and race discrimination. “When I got hired two years ago, they told me $8.50 was the starting rate. Then they hired an 18-year-old white girl, right out of high school, and started her at $9.50. Recently a Hispanic woman started, and they’re paying her $8.25.” Evans reports there’s only one black supervisor at her plant; at another plant, they do not hire any blacks as drivers, even if they are well-qualified, and some plants are stratified by gender as well.

“It’s a sad situation,” Evans sighs. “I just hope they can be a fair company, hire people at the same rate, and a decent rate, and give people of color a chance to move up. It’s not just about me, and it’s not just about money. It’s about finally treating people with respect.”

Voice vs. Vote

“I’ve met Howard twice,” Tawana Green tells me, easily referring to Starbucks board chair Howard Schultz. At a company leadership conference, “he told us, ‘we take care of the partners, the partners take care of the customers, and the customers take care of the business.’”

Green avoids the word “employees” in favor of the company lexicon, “partners,” and quickly corrects herself the one time the e-word slips in. However, a number of Starbucks workers in Canada and the U.S. have begged to differ on the partner/employee question.

Jef Keighley, a national representative for the Canadian Automobile Workers, is bitter when he describes his experiences organizing Starbucks in British Columbia, where the union is in a drawn-out contract negotiation covering 10 Vancouver stores. “We used to have 12 stores,” he says, “but the company has had a hand in organizing decertifications at two of those stores, even selecting and paying for the lawyer. We’ve been at the Labor Board for a year and a half.”

Keighley admires Starbucks’ tactical and PR sophistication, but dismisses any sincerity around the mission statement as “an absolute crock.” He’s particularly exercised about the bean stock benefit. “Most would be better off with the money in their paychecks,” he asserts. “Our committee knows they’re only getting the sizzle while Starbucks keeps the steak.”

In his own book, Howard Schultz—a Brooklyn boy made good—clearly expresses a belief that benevolent management should make unions superfluous. It’s almost as though the desire to have outside representation is seen as a personal affront that hurts Schultz’s feelings more than his profit margins.

UNITE says it has yet to hear from Starbucks about Cintas. But Starbucks General Counsel Paula Boggs insists that, “We take any allegation regarding our suppliers very seriously. We have instituted a supplier code of conduct, and we do look for partners that share our values. Is it perfect, always? No. But it’s certainly worked in the main for us.”

Bringing It All Back Home

So, what about the most common

A crucial concern on the global level has been the survival of coffee farmers and the environmental sustainability of production. Coffee is second only to petroleum on the world commodities market, and the price is at catastrophic lows of 40 to 50 cents per pound, threatening roughly 250 million small farmers. There seems little question that pressure from human rights and environmental groups in the mid-’90s spurred Starbucks’ commitments in Third World coffee-growing countries. They instituted coffee-sourcing guidelines, and have negotiated long-term contracts and created direct relationships with suppliers to stabilize the income of the farmers. In 2002, they paid an average of $1.20 per pound up to a high of about $1.41. Steve Coats of the US/Labor and Education in the Americas Project (US/LEAP) suggests that, “They don’t move any faster than you push them. They may purchase only 1 percent of the coffee, but they can set the standards and tone.” However, both US/LEAP and Global Exchange acknowledge that Starbucks has made significant changes in its policies and practices.

There is also a pervasive belief that Starbucks is driving out the independents, but evidence is slim. As I recall, in the distant past of 15 years ago, most coffeehouses were near universities and in Italian neighborhoods. Cheap coffee was found at the local diner, and good coffee was an oxymoron. Are we really saying that there should be no coffeehouses in urban communities of color? Are we arguing against a decent latte at the airport? It may be an unnecessary luxury. But a sign of evil conspiracy? I’m not convinced.

Nor is Starbucks equivalent to Wal-Mart; it has not forced a downward spiral in either prices or wages, it is arguably the best employer in its sector, and it has not turned old main streets into ghost towns. However, Starbucks has joined McDonalds and Wal-Mart in hyper-aggressive expansion, especially abroad, thus setting itself up as a symbol of the Americanization of the world.

At the community level, though, it’s often hard for people to understand why the store where they shop and work has been targeted. “I remember being in a demonstration where a McDonalds or Starbucks window, I forget which, was shattered,” says Colin Rajah, a long-time global justice organizer, currently a program associate at the National Network of Immigrant and Refugee Rights. “We could see the staff, people of color, running toward the back of the store and cowering behind the counter, really scared. I was in a group of young global justice activists of color, and we immediately found ourselves identifying with the people inside the store. And we realized that tactic was a mistake.

“Sure we have to look at the larger picture and how the capitalist system works, but if these entities provide a service to the community, and are not abusing their workers, there’s something to be said for that as well. What we should be looking for is the democratization of the process.”

I couldn’t really get an answer at Starbucks headquarters on how big was too big. “I guess too big is all relative,” says Starbucks VP Wanda Herndon, “but big is not necessarily bad if you’re doing good things.” Mostly, she feels misunderstood by the protesters, who have continued to sporadically damage stores around the country. “The way I felt was that the people who were protesting didn’t understand who Starbucks really is, the company, the culture, the people,” she explains. “But because our siren makes good news, we became a symbol of all that went wrong with WTO.

“We’ve always tried to balance profitability with benevolence, and I think that’s a concept that’s hard for people to grasp. You want to be profitable, but you realize you need to give back if you want to be a part of the communities in which you do business.”

As it turns out, Starbucks appears improved on trade, good on race, and a model on health care for part-timers. Amazingly, they have only recently acquired their first government relations staffer, and it remains to be seen whether they will parlay their position into fighting nationally for civil rights, the environment, or national health care.

“People who go into corporate management didn’t sign up to be civil servants,” notes global justice organizer Liz Butler. “But increasingly, the crucial decisions are being made in board rooms, and we need them to take on that role.”

And, at Starbucks, there’s some hope of getting through; after all, some of the top management were the anti-war activists of the ’70s. Meanwhile, I’m certain that Tawana Green would care about the fate of Sandra Evans, though I wonder whether the company VP’s will feel the same. I’m not holding my breath that they’ll ever prefer union representation to benevolence. But I’d like to think that they will not be down with the race and gender discrimination of a Cintas.

As Liz Butler puts it, “McDonald’s never says it’s a good neighbor, but Starbucks does. It’s our job to hold them to it.” Perhaps then Starbucks won’t be doing business with Sandra Evans’ oppressor, and activists won’t be throwing bricks through Tawana Green’s window.