Starbucks, The Tech Sector, And The State Of American "Progressivism"

Something exciting just happened in San Francisco. And it should pose an intellectual challenge for those who call themselves “progressives.”

Starbucks, the Seattle-based coffee beverage giant, announced that they will soon allow mobile telephone purchases in their stores. Get the new app from San Francisco-based Square, Inc. on your smart phone, order your drinks in the store, and – presto! - pay the bill with your iPhone or Android.

Along with this new approach to sales, Starbucks is also investing $25 million in Square Inc., and Starbucks C.E.O. Howard Schultz (a bona fide “food and beverage revolutionary”) will soon join Square’s Board of Directors. This was all quite surprising news- especially the part about a coffee company buying into a tech company -but it was nonetheless a cause for celebration in the City by the Bay. Yet another local “tech start-up” appears to be on its way to big things – and this one will likely make mobile retail a mainstream phenomenon.

In the world of business and technology this is certainly progress – consumers will soon be given more choices and convenience, while retailers will have more opportunity to sell their products and generate revenues. And those who choose to invest their money in either of these companies (both the private equity partners of Square, Inc., and the Starbucks stockholders) will likely reap financial benefits as well. But despite all this additional progress – for consumers, retailers, investors, and for San Francisco’s private sector economy - one nonetheless has to ask: can we really call this development “progressive?”

Along with being an epicenter for business development and economic progress (think Apple, Twitter, Cisco Systems, Facebook – and in a bygone era, Levi Strauss and Co.), the San Francisco Bay Area is also an epicenter of political and cultural “progressivism.” And while “progressivism” began in the U.S. as a humanitarian reaction to the social ills accompanying industrialization, today it has become an anathema to human achievement and private enterprise. The result of this bizarre confluence is simply this: there are lots of self-described “progressives” in the United States who enjoy the benefits of private enterprise and human progress, but who nonetheless support some of the most regressive ideas and attitudes that exist in our society.

Consider further the relationship between Starbucks and “progressives.” Few people in the world question the ethics of Starbucks, as their corporate mission statement has always included a quest for “a balance between profitability and social conscience.” Ensuring that farmers are paid reasonably for their coffee beans, investing in the communities where they operate stores, recycling and conservation initiatives, and extraordinary compensation packages for employees (the company provides health and dental benefits to many of their part time employees) - these and other important agendas comprise the way in which Starbucks has always operated.

Starbucks remained consistent with these virtuous-yet-costly policies during the worst of the “great recession,” even as its stock value was tanking (the company is now headed upward again and many portfolio advisors once again recommend it as a “buy”). Yet when it comes to “progressive” activism, Starbucks is treated like every other for-profit, publicly traded entity – the company is simply presumed to be “greedy” and selfish because it seeks to produce a profit, and thus is vilified and maligned.

For “progressives” who believe that vandalism is appropriate (if you don’t respect people’s rights to own private property- a core tenet of capitalism-then it’s easy to justify destroying somebody else’s property) Starbucks is a prime target. Since the days of the 1999 World Trade Organization conference in Seattle when “progressives” damaged and impugned the company in its hometown, Starbucks has remained on the “progressive” activists’ hit list, and even during the past year’s “occupy” uprisings Starbucks stores were frequently the first to get trashed when violence broke-out. The humanitarian and eco-friendly efforts of Starbucks don’t matter to “progressives” of this sort – all they know is that Starbucks is a successful American corporation with a trans-national footprint, and therefore they are to be hated.

More civil-minded “progressives” likely reject this type of vandalism and violence, and some may even acknowledge and support Starbucks for its socially responsible track record. Yet they also support a President who maligns and vilifies American corporations at every turn, and who has advanced a public policy agenda that has stifled the growth of free enterprise rather than encouraging it.

Other “progressives” may support tech companies like Square, Inc., yet resent the fact that many such companies only design their products in the U.S. and have them manufactured elsewhere. A thoughtful person would at least consider how government policies may have driven labor costs upward and made manufacturing unfeasible in the U.S. – but “progressives” generally prefer to just be angry at American companies and then push for more punitive corporate taxation policies.

And do “progressive” owners of Starbucks stock have any idea what their presidential candidate of choice has in mind for their dividends? Shares of Starbucks many produce nicely over the next several months, but unless the President is stopped in November, taxes on dividend income will skyrocket in 2013.

Self-described “progressives” – in San Francisco and elsewhere – can enjoy the benefits of private enterprise like everyone else. Yet if their deeply-held attitudes and ideas prevail in America long-term, they will successfully bring about a “regression” of things that are important to all of us.

The classical Chinese empire had an interesting concept about the evolution of society, which while it wouldn’t work here, as such, has an element of common sense that we might be able to adapt to our advantage.

It was something of a “cycle of emperors”, based on the seasons of the year. In order, each of four emperors would be raised to perform in their particular mode of operation, to reflect spring, summer, fall and winter.

The first of the four was the “builder” emperor, who would essentially remake China from scratch. All new cities and infrastructure, like roads. Encouragement for new businesses. New social systems and lots of enthusiastic new leaders with new ideas (within the conformity of Confucianism).

The second, after the first emperor died, was the “maintenance” emperor, who would get this new China working, with all the bugs of the new system worked out and everything running efficiently.

After he died, the third emperor would be the “degenerate” emperor, who would pull most of the government into Peking, and let the country fall apart, allowing inefficient businesses to fail, ineffective social systems to collapse, and a general cull of what didn’t work. The only thing they wouldn’t tolerate is someone trying to save what should be allowed to fail.

The last in the series was the “destroyer” or “water” emperor, who set the government to wipe clean all the decayed everything, often at the cost of millions of lives, so that his replacement, the new “builder” emperor, would have a clean slate of a nation to build anew. The “water” emperors were a fairly brutal lot, but this was literally what everyone, from peasant up, expected of them. As to do so was seen as necessary for the health of their nation.

Now obviously, there are some serious flaws in this philosophy, like the “killing of millions of people” part.

But overall, it actually worked in a way, keeping China a vital and functional empire for a very long time, despite foreign invasions at about 200 year intervals. The “Chinese Way” was so integrated into society that while invaders would conquer a given dynasty, in a generation or two, the invaders would be doing things the Chinese Way, and would effectively become Chinese.

As an interesting note, this system was so ingrained into the people that though Mao Tse Tung was a communist, had he been an emperor, he would have been a “water” emperor. So all the vicious brutality of the Cultural Revolution and The Great Leap Forward would have been expected of him, even demanded of him.

Emperors were kept in line to their programming, when they strayed, because if they ordered something not in line with their purpose, it just wouldn’t happen. Everyone ordered to obey would foul up, and things just wouldn’t come to pass. But if he did what he was supposed to do, according to his role, everything happened promptly and efficiently, and his orders were carried out expertly.

In any event, how could America adapt to the basic, underlying concept of an evolution to society, but in a more sensible, less violent, and more corrective way?

The first thing that comes to mind is city management. Some of the modern western (Republican led) cities have taken to doing an infrastructure repair schedule, in which they “rotate” neighborhoods of the city so that repairs and replacements are staggered.

The neighborhood in most disrepair is fixed first, in one big project. Once it is done, with some maintenance, it should last for years in good condition. Since the neighborhood second to worst in disrepair is “in the batter’s box” for a rebuild, it gets little or no maintenance and is allowed to decay.

In this way, a piece at a time, the city is revitalized in its entirety. It accepts that the city will never be either completely pristine, but it will also never be completely falling apart, like Detroit.

But this also works at the national level, with national infrastructure like the Interstate Highway System, dams and waterways, airports, railroads, etc.

To every season, turn, turn, turn.

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