Former Starbucks CEO Schultz Defends Billionaire Status In Heated Exchange With Bernie Sanders: ‘I Earned It’ - Forbes

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Topline

Former Starbucks CEO Howard Schultz defended his billionaire status against intense criticism by Sen. Bernie Sanders (I-Vt.), with assistance from several Republicans, during a contentious Senate hearing Wednesday on the company’s labor practices.

Key Facts

Sanders repeatedly brought up the wealth discrepancies between company leaders and rank-and-file employees in explaining his support for Starbucks employees’ efforts to unionize, a movement opposed by Schultz: “The fundamental issue we are facing today is whether we have a system of justice that applies to all — or whether billionaires and large corporations can break the law with impunity,” he said in his opening statement on Wednesday.

In response, Schultz told Sanders: “Your [billionaire] moniker constantly is unfair,” adding “yes, I have billions of dollars. I earned it. No one gave it to me. And I’ve shared it constantly with the people of Starbucks.”

Schultz voluntarily testified before the Senate Health, Education, Labor, and Pensions Committee on Wednesday after Sanders, who chairs the committee, threatened to subpoena him in its investigation of whether Starbucks and other corporations violated federal labor laws.

During the hearing, Schultz admitted that some of his conversations with employees seeking to unionize may have been misinterpreted in response to questions from Sanders about whether he has ever intimated workers.

Schultz also denied reports that he once told an employee “if you hate Starbucks so much, why don’t you go work somewhere else?,” telling Sanders, “that’s not exactly what I said,” though Sanders did not allow him to elaborate on the conversation.

Republican senators including Markwayne Mullin (Okla.), Mitt Romney (Utah), Bill Cassidy (La.) and Rand Paul (Ky.) defended Schultz, with Paul calling the Senate probe a “witch hunt,” adding “count me as one who is ecstatic that Starbucks is an American success story, and I’ll have no part in trashing their success.”

Forbes Valuation

We estimate that Schultz is worth $3.7 billion, making him the 753rd wealthiest person on Earth as of Wednesday. Schultz became CEO of Starbucks for the first time in 1986 and helped grow the company from its start in Seattle to the largest coffee chain in the world, and stepped down from his third tenure as CEO last week, nearly two weeks earlier than expected.

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Key Background

Starbucks initially declined to put Schultz before the committee voluntarily, citing his long-planned departure, but ultimately agreed to allow him to testify when Sanders threatened the subpoena. The Starbucks employees’ union, which represents workers in more than 250 stores that have voted to unionize, has filed hundreds of complaints against the company for unfair labor practices since 2021, and in some cases, the National Labor Relations Board has ruled that it illegally fired employees engaged in the union efforts. Sanders said the NLRB has found the company violated labor law more than 100 times in the past 18 months, “far more than any other corporation in America.” Starbucks has denied that it illegally fired employees, and Schultz said Wednesday he is “confident” the allegations against the company “will be proven false.” Schultz has staunchly opposed unionization efforts at Starbucks, claiming the company is better positioned to negotiate with employees—which it refers to as “partners”—without the presence of union representatives. Though he acknowledged employees’ right to unionize on Wednesday, telling Sanders “we respect the right of every partner who wears a green apron whether they choose to join a union or not."

Crucial Quote

“Over the past 18 months, Starbucks has waged the most aggressive and illegal union-busting campaign in the modern history of our country,” Sanders said in his opening statement.

Contra

Schultz defended Starbucks’ interactions with employees seeking to unionize, telling Sanders “Starbucks Coffee Company unequivocally . . . has not broken the law.”

Surprising Fact

Schultz’s feud with Sanders and backing from Republicans stands in opposition to the billionaire’s political leanings. He weighed a run for president on the independent ticket in 2020, but ultimately dropped out of the race, citing concerns his presence in the race could split the Democratic vote and facilitate the re-election of Former President Donald Trump.