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Jon Talton

Analysis and commentary on economic news, trends and issues, with an emphasis on Seattle and the Northwest.

June 16, 2014 at 10:17 AM

A pioneering move by Starbucks

Let’s get this out of the way first: Seattle will never forgive Howard Schultz for betraying us on the Sonics and allowing them to be sold to the Treacherous Okies. That said, Starbucks’ announcement that it will help employees go to college is an important move in fighting the inequality that has reached Gilded Age levels.

One of the prime challenges of the post-industrial economy is creating pathways for service workers into the highly paid creative class. Unions are good and necessary, but they have their limitation. While a service employee union can help ensure better wages and treatment, it will never have the bargaining power of organized labor representing well-compensated manufacturing workers. And in today’s climate, unions are fighting for their lives.

On the other hand, if the tuition reimbursement plan unveiled by Starbucks works, it could allow thousands of employees to move up into better jobs. College-educated Americans still have much greater earnings power than those who don’t get a degree. If students can get a degree with manageable student-loan debt, so much the better.

Starbucks is not partnering with a pricey diploma-mill like the University of Phoenix, but a real institution of higher learning, Arizona State University (my undergraduate alma mater). I have misgivings about online programs because they cheat students of the human interaction of a real university, but I am whistling against the wind. If this works out, Starbucks workers could emerge with real degrees from a quality university.

It’s good for Starbucks, adding another perk to retain employees. It also helps feed the “virtuous cycle” of growing a middle class that can pay for the company’s products.

The partnership between Starbucks and ASU isn’t surprising. ASU’s President Michael Crow is committed to “a New American University” that allows the most number of students access to higher education. Crow is very business savvy in a state whose Legislature is hostile to funding education. Look for him to make more such deals with enlightened employers.

Monday Reading: The nation’s economy this side of the recession | NY Times

Today’s Econ Haiku:

Those Iraq trillions

Could have built America

Mission accomplished

Comments | More in Starbucks

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