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A Corporation Steps In

Howard Schultz announcing a plan to partner with Arizona State University to provide an online college education for company employees.
Howard Schultz announcing a plan to partner with Arizona State University to provide an online college education for company employees.
Photo by Andrew Burton/Getty Images

Good for Starbucks! Sort of.

The coffee giant has announced a program to provide a free online college education to thousands of its workers through a cooperative program with Arizona State University. The offer is available to any of Starbucks’ 135,000 employees in the United States, provided they work at least twenty hours a week and qualify for admission to Arizona State. And Starbucks will not require employees to remain with the company.

“For many of these Starbucks’ employees, an online university education is the only reasonable way they’re going to get a bachelor’s degree,” says Jamie Merisotis of Lumina Foundation, which focuses on education.

Starbucks has a reputation for being generous in a traditionally low-wage service industry, providing health insurance, even for part-time employees, and giving stock options to its workers. So this offer is in line with the company’s past policies.

Yet there are limitations in the fine print. The tuition will be paid as reimbursement after students have spent thousands out of pocket. ASU is charging Starbucks’ employees less than the sticker price, which means it’s subsidizing the company’s employees, and much of the rest of the tuition will be covered by federal aid since Starbucks’ workers are low paid.

But that’s not the real problem with the Starbucks’ college plan, which is better than most companies offer and which will provide a path to a college education for at least some of its baristas.

No, the real problem is that a corporation is stepping in where the federal government has failed to act. Howard Schultz, Starbucks’ founder and chief executive, conceded as much in announcing the plan. “In the past few years, we have seen the fracturing of the American dream,” he said. The question for all of us, should we accept that, or should we try to something about it?”

At least Schultz is trying, which is more than can be said for most other CEOs of most other companies. Look at Walmart, where underpaid workers don’t get benefits and often have to rely on public assistance in the form of food stamps — when the money runs out at the end of the month — and Medicaid. That costs the rest of us — you and me. House Democrats estimate that the average Walmart superstore costs taxpayers $904,000 a year in subsidies, which averages more than $5,000 per worker.

We — the taxpayers — subsidize Walmart and then rely on Starbucks’ tuition plan to provide a service for its workers that most advanced nations provide for their citizens. The United States once did as well: The G.I. Bill helped millions of returning soldiers get a college degree as a means to a better life. That was available to all — not contingent on where a prospective student worked.

Instead of relying on government to provide basic services, we now turn to corporations. It’s great when a corporation steps in, as Starbucks has, but not so great for those millions of low-paid workers stocking shelves at Walmart and slinging hamburgers at fast-food restaurants. They’re not likely to get a college education, which means they’re likely to spend their lives stocking shelves or slinging hamburgers.

For every barista at Starbucks who is lucky enough to work for a company that helps its employees get a college education, there are tens, hundreds, thousands of employees who work for low-wage employers who do not provide a similar benefit.

This is our future, unfortunately. It’s our future because Republicans in Congress refuse to do anything to improve the lot of most Americans. They won’t raise the minimum wage — they won’t even let it come to a vote. Their refusal enables Walmart to pay starvation wages. And Republicans obstruct attempts to provide loan relief for students — which forces the occasional corporation to step in where the federal government won’t go.

Congress could raise the minimum wage and it could make college more affordable. It could make it accessible to all qualified applicants. But these actions run counter to the conservative mantra that the free market solves all problems.

Only it doesn’t. The free market won’t provide a living wage for millions of Americans. The free market won’t provide health care for all workers. And the free market won’t enable millions of qualified young Americans to get a college education.

These are jobs for government — for you and me.

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