A rare voice on minimum wage
Howard Behar, former president of Starbucks, explains why he supports a referendum campaign that would send Seattle’s minimum-wage ordinance to the ballot.
Times editorial columnist
Seattle’s business community didn’t put up much of a fight when the City Council passed its highest-in-the-country $15 minimum-wage ordinance this month — at least not the united opposition that might be expected in a city of lesser size. But at long last, Howard Behar has had it with that talk of “sticking it to the man.”
“First of all, it’s not just the man anymore,” he says. “It’s the man and the woman. But is that what we think this is about? We’re trying to get somebody?”
If anyone is the man, it is Behar. He is the former president of Starbucks, the Seattle-based coffeehouse chain with more than 20,000 outlets worldwide. Though Starbucks is one of the world’s most recognizable brand names, it was not vilified during the campaign by union organizers and political activists in the same way as favorite corporate targets McDonald’s and Wal-Mart.
The company prides itself on the fact that it pays a bit more than the current minimum wage, provides health insurance for its employees and recently implemented a college tuition benefit. Yet, with a corporate headquarters about a mile from Seattle City Hall, the company is affected by the raised minimum wage as clearly as the smallest espresso hut along Highway 99.
In criticizing the Seattle plan, Behar is not speaking for the chain he helped build from 28 stores before his retirement as president in 2007 — his only direct financial interest in Starbucks is the one share of stock he keeps framed on the wall. A lifetime spent in business tells him the Seattle plan will hurt the low-wage earners it aims to help by raising the cost of living, and driving light manufacturing and distribution jobs beyond the city limits.
That is why he is a major contributor to Forward Seattle, the organization gathering signatures to place a referendum on the November ballot to undo the ordinance. Behar agrees the wage should rise, but says the city ought to phase it in over a much longer period of time, perhaps at twice the rate of inflation until $15 is reached, for businesses of all sizes, uniformly.
Behar’s voice is important because so few in Seattle’s big-business circles have been willing to say a word. In smaller cities, small business dominates the Rotary clubs and the chambers. The silence from many Seattle-based business organizations reflects the fact that this is a regional headquarters city for so many large corporations. Some shrug — they pay more than minimum wage — and by taking a stand in Seattle they could bring picket lines elsewhere in the country.
“Business leaders are scared to death,” Behar says. “Because you know in today’s world what happens when they speak up? They are accused of being greedy, they are accused of not caring about people.”
Behar calls the Seattle plan unjust and immoral — some reasons familiar, others not.
The Seattle plan will require big companies, chains and franchisees to raise wages faster than mom-and-pop operations, the idea being that big corporations can afford it. Franchisees are, of course, small-business owners themselves, a fact the Seattle ordinance ignores. And Behar notes that in a chain, each store is considered a stand-alone business and each is expected to turn a profit.
So, either Seattle chain outletswill raise prices in Seattle, just like mom-and-pop stores will — or, perhaps worse, they might allow that store in Cincinnati to subsidize the one in Seattle, and keep prices low until shakier independent merchants close their doors.
And, while the proposition was sold with the idea of reducing income inequality, the shock on the local economy will mean higher prices for things bought locally — buying power of a higher minimum wage is reduced.
Behar says a proposition with such a dramatic effect on the city ought to bypass a council where special-interest groups hold sway. “The idea this got a fair hearing is garbage. Labor was going out the back door and business was sitting in the lobby.”
The vilification of big business to promote an unworkable economic ideal hits him in the gut: “If we are a just society, we treat everybody the same.”
In a city where no one has spoken for big business on the issue, Behar does seem to be the man.
Erik Smith's column appears regularly on editorial pages of The Times. His email address is firstname.lastname@example.org
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