Do you believe that there is room for
a part of the Starbucks workforce to be unionized?
>> I think that will have to happen in collective bargaining.
>> Because previously you've said no, this is not in your vision.
And the unions have said- >> Yeah.
>> That is evidence that you are not gonna bargain with them.
>> Could you ever see doing that embracing the union as part of it?
>> No.
>> Starbucks founder and CEO Howard Schultz sat down with CNN's Poppy Harlow
to share his views on the increasing unionization within the company.
Now, as many as about 268 Starbucks stores have in fact
voted in favor of forming a union.
Now, Howard Schultz came back from retirement specifically to squash these
unionization efforts and luckily he hasn't succeeded.
Keep in mind that 80% of the stores who voted to
unionize did in fact succeed in forming a union.
But that makes up only about 3% of Starbucks stores in the United States.
You have to consider that there are many Starbucks stores in the US.
Now I wanna get to the rest of the interview and some more information about
what Starbucks has been up to in terms of squashing unionization efforts.
And how the National Labor Relations Board has stepped in to protect some of these
workers.
Before I do though, Jake, do you wanna weigh in on this?
Because do you believe in any way that Howard Schultz is gonna be receptive to
this effort to unionize.
Well, so I think it's a little bit complicated.
I think that when he started,
he actually believed the things that he was saying, right?
But people change based on the culture that they're in.
That's just a fact for all of humanity.
And he's been at that executive level and the billionaire level for
a long, long time.
So I watched that whole interview.
And a lot of his assumptions are based on his new values,
not the values he started Starbucks with.
So if it was that Howard Schultz, he might be okay with unionizing or
he might have run a company that didn't need a union.
That's what he keeps saying today.
But if you watch the whole interview, he contradicts himself.
He says, no, these are our values, whether the union came in or not.
And then later in the interview, he says, well, the union made us do this.
Well, which one is it, right?
And so the reality is it's kind of both.
He started with those values in my opinion, okay?
And now whenever he talks, he's always like, hey, I got shareholders value.
And he said in the interview, hey, in the 10 months, I've been back,
our stock has got a $40 billion.
>> I know, but Jake- >> But
wouldn't that tell you that you could then afford a union?
But he thinks no, he's talking to other rich people and telling them,
look at how great I am.
I'm both magnanimous and making tons of money.
>> Yeah, shareholders aren't interested in what Starbucks can afford to spend
money on- >> Yeah.
>> Other than returns on investment for the shareholders, right?
>> Of cource they want maximum return.
>> So his personal values don't really matter.
His actions matter, right?
And his actions have been- >> Yeah what he does-
>> To fire some of
the workers who were unionizing their workplace.
>> No, that's my point.
>> Yeah.
He has new values and doesn't realize it.
Now his values are, and he says it in the interview,
maximizing shareholder value- >> Yeah.
>> Right? No,
values are supposed to be about morality.
They weren't supposed to be about the value of the stock price.
Yeah, it's not like a year end job performance review, okay?
That's not what values are, okay?
So let's go to some more of his video here.
We'll also give you some details on why the workers wanna unionize in a minute.
But let's get to some more video.
>> It's my belief that the efforts of
unionization in America are in many ways
a manifestation of a much bigger problem.
I've talked to thousands of our Starbucks partners in these co-creation sessions.
And I was shocked, stunned to hear the loneliness,
the anxiety, the fracturing of trust in government,
fracturing trust in companies, fracturing of trust in family.
The lack of hope in terms of opportunity.
>> [APPLAUSE] >> The primary reason
that I was interested in trying to run for president was the very
essence of helping people try based on the life that I've led and
where I grew up to create an opportunity to get out of the malaise that they're in.
>> But I think though some of those people are the ones that are pushing for
unionization now and
looking to you as the head of the company- >> Yeah.
>> To come to the table with them.
>> It's interesting that he's looking outward instead of looking inward, right?
But why do you think the workers wanna unionize?
It's because they don't trust politicians, or could it be that they're looking around
in their workplace, they feel powerless, they feel that they're not being
compensated fairly, they don't feel the working conditions are humane.
And so they wanna have a seat at the table and
the ability to collectively bargain with the employer in regard to these issues
that have a very real material impact on their day to day lives.
>> Yeah Anna there's a second disconnect that we don't talk about enough.
We just earlier in the show talked about the culture wars and
how that creates a disconnect in the country between the right wing and
the left wing when we actually share economic interests, right?
In this case, this is the economic disconnect.
So I've talked to people that are in the same culture as Howard Schultz,
let's just put it that way.
And they genuinely don't get it as Howard Schultz showed you in that clip.
He's like, they seem like they've lost faith in the government and companies.
And he's like bewildered as to why.
I can tell you Howard, it's super easy, because those companies pay off those
politicians through campaign contributions and then get deregulations and
lower taxes and every advantage you could possibly imagine.
We can't even negotiate our own drug prices.
Meanwhile people die, cuz they're rationing insulin and other drugs, and
they can't get any higher wages, and were being crushed by those companies that you
value so much that you think are the God's gift to humanity.
No, those are the corporate machines that are steamrolling the American citizens.
And he genuinely doesn't, and by the way, it's not just him,
almost no one in power gets it.
They think, well, what, what, why are you guys losing faith in these great companies
and government that we have?
It's working out great for me.
>> Yeah it's working out great for you >> Yeah, for you.
>> For you, exactly.
So why don't we actually hear from Starbucks workers?
Howard Schultz should maybe sit down and listen to these workers himself.
Because it seems like he doesn't even understand what is motivating them to
wanna unionize in the first place.
So what do the employees say?
Let's hear from a 20 year veteran worker at Starbucks named Daniela.
Let's watch.
>> The communication between higher ups and
our stores started to become non-existent.
They introduced so many new things like components to drinks,
mobile orders, deliveries.
We were never given the tools to make that happen properly.
We were doing all this extra work and we weren't
getting paid for what we think that we were worth.
>> I worked at coffee bean and tea leaf while I was in undergrad.
And it is an incredibly difficult job.
It is fast paced, you're on your feet, the entire shift,
you deal with customers who are incredibly rude, they want their coffee.
I had a hot latte literally thrown on me on my very last day of work, okay?
It is incredibly difficult job and Starbucks,
its profitability is dependent on these workers.
And they're looking at what they're getting paid relative
to what the corporation is making off of their labor.
And they want a bigger piece of that pie, and quite frankly,
they deserve a bigger piece of that pie.
That is why they are unionizing, Jake.
So Howard Schultz gets frustrated.
Look, I run this company as well, so I understand both sides.
And so he says, well, look, they say they wanna sit at the table and
they want more say in what we do, I don't get it.
I don't know what that means.
Well, if they mean, hey, listen,
don't introduce the prop because the grand is working out with the venti, whatever.
Look, you didn't, you weren't part of the market research,
you're not involved in finance or the marketing angle of it.
So I have some sympathy for everybody has a specialty and
I'm not sure that you're gonna, you know all the pieces of the puzzle.
So, okay, fine.
But when they talk about economic seat at the table, but howard you keep bragging
about the $40 billion you just added over the last 10 months.
You can't then turn around and say no,
I can't share a bigger piece of the pie with my workers.
And then tell me that you have these great values that came up within the 1970s,
that you're not at all applying today.
>> In fact, you keep referencing that part of the interview.
And I think that was the telling part.
Because he said the quiet part out loud, right?
>> Yeah. >> So why don't we go to that where
he brags about the profitability of Starbucks and his performance?
>> You've said that unions are contrary to Starbucks vision.
>> Yes. >> And that's your vision?
>> Well, it's not only my vision,
I think the 51 year history of Starbucks is a vision,
a collective group of people that believe- >> Right.
>> In doing everything to create value for our people so that we can create value for
our shareholders.
And we've done that.
>> Value for our shareholders.
Understand that under this model, under this system, that is the first priority.
That is the most important part of running a business in the United States
if it is a publicly publicly traded company as Starbucks is.
Let me just give a few statistics here some numbers,
because you made a really good point Jake about how there's enough wealth here,
enough revenue being generated, enough profit being generated.
That unionizing doesn't necessarily mean that it's gonna hurt the company.
And in fact, with hundreds of these stores now unionized,
it appears that it hasn't hurt the bottom line for Starbucks.
First when the organizing started, Starbucks reported a 31%
annual growth in profits in 2021, the year workers began unionizing,
as well as $8.1 billion just in the fourth quarter of that year.
And guess what?
They're doing even better now.
So Starbucks has pulled in record sales in 2022.
In the latest fiscal quarter,
sales in North America were up 11% compared to the same period in 2021.
Now the sales are up,
because there are workers behind the counter at the cash register,
taking the orders, making the orders and getting the product out to the consumer.
There is no profit in there, there is no revenue without those individuals.
They deserve a bigger piece of the pie.
That's not saying that they deserve a disproportionate piece of the pie,
but they certainly deserve more than they're getting paid now.
And they deserve better working conditions,
including the tools necessary to carry out whatever new initiative Starbucks has, or
new product Starbucks has.
>> The last two things for me, one is $8 billion in a quarter means that in less,
assuming the fourth quarter is a little bit better than the other quarters,
is around $30 billion in not revenue but profits per year, okay?
>> Nuts.
>> Don't tell me that you don't have enough for the workers.
One of our members wrote in KAF flux wrote in, I work for Starbucks for
eight years and the mission statement was always something we prided ourselves on.
The mission statement used to be essentially when we take care of you,
you take care of us.
But if you're making $30 billion in profit, and they've got to unionize to
get better wages and and other benefits, are you really taking care of them?
It certainly doesn't look that way.
And finally the media is so interesting guys.
If you watch this interview,
Poppy Harlow actually asked me about the unionization many times.
So you would actually get the sense of maybe she was a little bit tough on
him, right?
She kept going back to that issue, right?
But the magic is in what you don't see, okay?
So number one,
Howard Schultz wanna do an interview to get his side of the message out.
Because he thought, hey, the union guys are constantly in the press and
we're not answering them.
So I'm gonna pick a place that's gonna give me what I think is
going to be the softest and easiest interview.
In this case it was CNN.
So what is implicit in that interview, given that she's gonna ask about unions,
that's the whole point is to come on to answer these questions.
But not questions that are too aggressive, right?
And the framing matters a lot.
So I noticed in three or four different instance of that interview, you can watch
it for yourself, when Howard Schultz says something, especially something that is
pro-Starbucks and is maybe even a little inspirational in their own mind.
They would then roll tape of wild applause.
>> That's right.
>> And it was leading into the next segment and
there was always an ostensible reason when he ran for president.
He's going on stage and there's applause.
Starbucks workers applauding when the union instead of him, but
he would speak and there would be applause.
Then they went to Brooklyn, his home growing up, and they did like a third
of the interview about how poor he was, and how he worked his way up, and
how he's an average man, just like you guys with those values.
>> It's what the new york post did with their recent puff piece on Ron DeSantis,
painting him as this working class blue collar guy, who went to Yale.
[LAUGH] >> Yeah.
Yeah, and they're sitting in a comfortable
studio, and they're having a genteel conversation back and forth.
And if you watch the whole thing,
you get that you're left with the impression of this is a good guy,
and he's just like us, he's just struggling with this union issue,
right? >> Right.
>> And he keeps saying that their wages
and benefits are great, right? So at the end, you wind up thinking,
I guess the union could be wrong here, right?
If you watch the whole piece.
But by the way, wait a minute,
did you hear from the union at all? >> Nope, nope.
>> Did they do a 10 minute soft piece with
a union leader? >> Nope.
Did they go to their home
that they grew up in and see their poor middle class background, etc?
It's the acts of omission.
It's the acts of framing.
Look, Noam Chomsky taught me this, and
I'm telling you a small part of it, they've been doing this for a long,
long time. Mainstream media's job is not to give
you the news, is to give you theater that makes you go, I think the corporation
might be right after all. So once you see it, you can't unsee it.