CEO of Starbucks, Howard Schultz, Talks About Racism In America

Howard Schultz, president and CEO of Starbucks, speaks at a press conference announcing that Starbucks will partner with Arizona State University to offer full tuition reimbursement for employees to complete a bachelor's degree, on June 16, 2014 in New York City. (Andrew Burton/Getty Images North America)
Howard Schultz, president and CEO of Starbucks, speaks at a press conference announcing that Starbucks will partner with Arizona State University to offer full tuition reimbursement for employees to complete a bachelor’s degree, on June 16, 2014 in New York City. (Andrew Burton/Getty Images North America)

Howard Schultz, the CEO of Starbucks, is well known for taking a stand on political issues, from veterans rights to overcoming political gridlock (remember those Come Together cups during the debt ceiling debacle and government shutdown?). Over the last few days, he’s stepped into the tricky terrain of racial issues and police brutality, with an impromptu Open Forum at the Starbucks Support center in Seattle, in which he offered Starbucks employees a chance to sound off about their own experiences with racism and racial issues. On Tuesday, he released the highly emotional video from that meeting to all 135,000 Starbucks employees in the U.S., along with a letter (below) provided exclusively to TIME in which he outlined his concern about the economic and political effects of racism and increasing social polarization in America. “I’ve watched with a heavy heart as tragic events and unrest have unfolded across America, from Ferguson, Missouri to New York City to Oakland, California,” wrote Schultz. “I’m deeply saddened by what I have seen, and all too aware of the ripple effect.”

Indeed, it’s an issue I’ve spoken about in depth with Schultz. As I wrote several days ago, Starbucks is a perfect retail proxy for the American economy, which is increasingly bifurcated, a nation of latte buyers and those who sell the coffee. The minute-by-minute data that Starbucks gets on consumer spending is perhaps the most sensitive indicator of U.S. consumer confidence around, so it was startling to hear from Schultz that coffee sales took a hit during the riots in Ferguson, which is something that concerns him not only from the point of view of the economy and U.S. consumers — whom he calls “fragile” — but from a political stability point of view as well. “I don’t want to go into specifics,” Schultz told me the day after riots in New York City, following the announcement that a grand jury would not indict a police officer in the chokehold-related death of Eric Garner, “but I can tell you that the volatile situation in Ferguson and the situation in New York had an immediate negative effect on consumer behavior across the country.” What’s more, Schultz says he believes there’s a growing despondency amongst the public that government officials simply aren’t up to the task of dealing with these issues, something that will have an effect on business and the economy, even in the midst of a so-called “recovery.”

“I talk to other people who are running national retail companies,” says Schultz. “We’re at the heart of the holiday season, and there are protests going on throughout the country, but aside from that, the American people have a fractured level of trust and confidence in government today. That’s a fact. Over the last year, if you track the bar graph of where that [trust] was a year ago and where it is today, it has continued to go down,” he adds. “So I think every consumer business, no matter who you are or what you do, is fighting against the cloud that is hanging over the American people, about how they’re feeling about the country, how they’re feeling about their future — and all of that is directly linked to their lack of faith and confidence and trust in the leadership in Washington.”

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SOURCE: TIME
Rana Foroohar

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