Starbucks gets burned by the left

Remember back when Starbucks was about selling coffee? Starbucks Corporation now epitomizes the futility of using political pandering to buy protection from the left. The company has been at the forefront of the “woke capitalist” revolution. When conservative shareholder activist Tom Strohbar confronted Starbucks founder Howard Schultz about using the company’s brand to endorse gay marriage, Schultz retorted that if someone doesn’t agree, they shouldn’t own shares in the company.

This, of course, reveals the sheer arrogance of a CEO who doesn’t understand what a publicly traded company is. To be publicly traded is to no longer get to decide who owns shares. CEOs work for shareholders. Ultimately, shareholders have the authority (through the board) to fire CEOs. CEOs do not have the authority to fire shareholders.

It didn’t stop with gay marriage. Whatever the left orders, Starbucks serves up in venti portions without delay. Endorsements for everything LGBTQ, racial quotas that are impossible to fulfill without reverse discrimination, responding to vague allegations of racial discrimination with the massive overreaction of a public order degrading policy of open bathroom access, and pandering to the riot ideology by support for BLM. And what did all that buy? Nothing.

Actually, it bought less than nothing. It created a liability, a sense from the left that it was owed more than it had received. Like all companies that have gone down this path, Starbucks has found that pandering to the left is not the end of a transaction but a pledge to continue in that direction with no endpoint. Companies that make public pronouncements on the thing of the month find themselves on the receiving end of endless demands for actions that are in “congruency” (a buzzword in shareholder activism) with their stated values.

Say you believe in gender equality? OK, divest from pro-life states despite growing populations and falling taxes. Say you’re concerned about animal welfare? OK, change your pricing structure to entice customers away from cream. (And, yes, some shareholder activists argue that it would be good for a coffee company to get their customers off cream.) Are you committed to human rights? Well, that means opening the doors to unionization.

Unionization is where it’s all going wrong right now. Shareholder proposals on proxy ballots seldom get majority support. Still, a proposal pushing Starbucks towards unionization, backed by the pension assets of the taxpayers of New York, received a slim majority of votes cast. The proposal calls upon the company to hire a third-party firm to document how it falls short of its human rights statement about freedom of association when it opposes the unionization of its own workforce. When it comes to political pronouncements, as with many other things, “Better not to vow than to vow and not pay” (Ecclesiastes 5:5).

Starbucks is now on the wrong end of findings from the National Labor Relations Board, which says the company has violated the rights of its employees to organize a union. One particular issue occurred when the company shut down a store that had recently unionized. The company argues that workers weren’t showing up for work.

Now unions are striking over some store managers’ insufficient enthusiasm for “pride” flair. Again, the congruency weapon is wielded against the company. The company claims to be an enthusiastic supporter of every letter in LGBTQ and every color of the rainbow. Still, when individual store managers are given a bit of autonomy over how (not whether) to support pride, the company faces accusations it has abandoned its open-ended commitment to the politics of sexual identity.

This company needs to pull its burnt fingers back from the fire, to get out of politics and back to business. Despite the high price of Starbucks’ products, margins in that business are tight. The company simply cannot afford a wave of unionization, and it should stop making vague human rights pronouncements that create a sense of obligation that union organizers can exploit.

Starbucks can’t afford to alienate any customers any longer. It can’t afford to turn its bathrooms into magnets for homeless addicts. It can’t afford to treat shareholders as subordinate to its social justice goals. It can’t afford the lawsuit that has come from what appears to be reverse discrimination. It can’t afford to be an advocacy group rather than what it is supposed to be, a profit-seeking company in a highly competitive industry. The company has gotten burned in its deal with the left. It’s time it learned its lesson.