Howard Schultz isn’t solving America’s problems. He’s reinforcing them.
Tuesday night, CNN will host a live town hall with former Starbucks CEO, and potential presidential candidate, Howard Schultz. Why is Schultz, a political newcomer who “had the worst numbers of any potential candidate tested” in CNN’s own poll, getting such red-carpet treatment?
The answer, of course, is money. Schultz is a billionaire, and in American politics, money is a shortcut to legitimacy.
“Schultz doesn’t have to do the hard work of building a mass movement or representing a genuine constituency to get attention in our politics, because the media uses ability to spend money as a proxy for seriousness of campaign,” says Lee Drutman, a political scientist at the New American Foundation. “And when the media bestows seriousness on a candidate, the public follows along.”
But just because you can self-fund a presidential campaign into relevancy, doesn’t mean doing so is a good idea — either for you, or the issues you care about.
I have disagreements with some of Schultz’s policy ideas, but that’s not really the point. What I want to show here is that if Schultz believes his own diagnosis of America’s problems, he’s going about this in exactly the wrong way, and demonstrating a disqualifying level of confusion about how the American political system works and what might fix it.
I should note that I tried to schedule an interview with Schultz to discuss these questions to him directly, but after initially agreeing, his team backed out. It’s a conversation I’d still be happy to have if they change their mind.
Howard Schultz’s case for Howard Schultz
Last week, Schultz’s team emailed reporters to tout their candidate’s first official speech, to be delivered at Purdue University. “Schultz will address some of the problems that have been intractable in the broken two party system including the tax code, healthcare, immigration, education, and economic opportunity,” they wrote. “He will focus on laying out an agenda for opportunity and restoring power to the American people.”
To say the speech laid out an agenda for anything, really, is to oversell it. But the speech did lay out Schultz’s basic diagnosis of America’s political problems. “Two-thirds of American voters agree that our two-party system is broken,” he says, “and it’s time for a centrist candidate not affiliated with either party to be president.”
Why would a centrist president help matters? “Being an independent centrist would completely free me from being beholden to special interest groups and extreme party ideologies,” Schultz says. “Leading as an independent would allow me to represent all of the American people, and focus on the best solutions through a new, non-partisan lens.”
The rest of the speech is a litany of policy issues in which Schultz names a problem (immigration, health care), lays out a caricatured version of the “far left” and “far right” solutions, as if that actually represents the debate, then offers a few sentences on what he would do instead.
In every case, Schultz’s solution is either what the mainstream of the Democratic Party is already proposing to do, or is so vague as to be meaningless. Consider, for instance, his solution for education:
We must make our education system more-nimble, more advanced, and driven by innovative new ideas. True reform requires everyone at the table: students, parents, educators, administrators, unions, charters, parochial schools and businesses.
That’s it. Seriously.
The two-party problem
At the core of Schultz’s diagnosis is the idea that America’s two-party duopoly is distorting politics and leaving Americans unrepresented, good ideas unnoticed, and policy problems entrenched. “People lose faith in democracy when they feel their vote doesn’t count, and their voice is not heard,” he says.
Schultz identifies two issues here. One is the way politicians get elected, which is where the two-party system gets constructed, and the other is the way policy gets passed, which is where the two-party system holds back progress. We’ll take them in turn.
In political science, there’s an idea known as Duverger’s Law, which states that winner-take-all election systems lead to two-party political systems and proportional representation systems lead to multiparty political systems.
The reason is simple enough. In a system where the only thing that matters is who gets the most votes, smaller parties will enter into coalitions large enough to win the most votes, or they will die off. In a system of proportional representation, where 15 percent of the vote can get you 15 percent of the seats, smaller parties can survive and even build strength without ever winning the most votes in an election.
Schultz says it is “intellectually dishonest to suggest that either party’s candidate could lose because of a third choice,” which suggests that Schultz either doesn’t know what the term “intellectually dishonest” means, or that he is being intellectually dishonest. But the way a party could lose because of a third-party candidate is perfectly obvious.
On virtually every policy issue, Schultz’s speech reveals himself to be closer to the Democrats than to the Republicans. On immigration, he wants a path to citizenship. On taxes, he says rich guys like him should pay more. On health care, he wants to build on Obamacare’s gains. On gun control, he wants universal background checks. On debt reduction, he wants to balance the budget “while keeping America strong and reinforcing the safety net for the most vulnerable.”
Schultz’s agenda is basically Barack Obama’s agenda, or Chuck Schumer’s agenda and, in theory at least, he can be expected to take votes from the Democrats.
Imagine an election conducted under proportional rules, where Donald Trump gets 40 percent of the votes, the Democratic candidate gets 38 percent of the vote, and Schultz gets 22 percent of the vote. In that election, Schultz and the Democrats get 60 percent of the vote and, given their zones of policy agreement and mutual antipathy towards Trump, can enter into a governing coalition.
In the American system, by contrast, Trump wins the election despite getting fewer votes than the two left-leaning candidates combined (I’m ignoring the Electoral College for simplicity, but you can replace the word “votes” with “electoral college votes” in this analysis, and there’s no difference).
And that, by the way, is roughly what polling Schultz’s own team sent me shows will happen if he enters the election. In head-to-head polls that don’t include Schultz, the various Democrats — including Harris and Warren — lead Trump by significant margins. But according to the memo Schultz’s staff sent reporters, in head-to-head polls that do include Schultz, Trump wins.
This is not to say Schultz is wrong about the problems of two-party political systems. I’d prefer a proportional representation system, for all the reasons my colleague Matt Yglesias outlines here. Since a system like that could threaten both Republicans and Democrats, if it’s going to happen, it’d need something like a committed billionaire funding a massive reform effort over a long period of time.
“In a first-past-the-post system, independents or third parties are destined to be spoilers,” says Drutman. “If Howard Schultz were really concerned about the underrepresentation of independent-centrist voters in our political system, and/or the limited number of choices a two-party system generates, he should use his billions to support growing efforts around the country to bring ranked-choice voting or even proportional representation to America.”
But rather than engaging in the hard, slow work of electoral reform, Schultz is just running his own campaign for the presidency, a project that would likely set the cause of third parties back by reelecting Trump.
In 2000, Ralph Nader ran as a third-party candidate with a much more sophisticated view of the electoral system, and much more party infrastructure backing him, than Schultz has, and his candidacy helped elect George W. Bush. As a result, a generation that might’ve been open to Green Party candidates in a multiparty system grew up blaming them for the outcome of the 2000 election. Nader’s candidacy weakened the Democrats, but it strengthened the two-party system.
The obvious counterargument is that the risk is worth it because Schultz could win the presidency, and if he did that, then he could just pass a bunch of laws reforming our electoral systems himself.
No. No, he couldn’t.
The president is not America’s CEO
In his Purdue speech, Schultz says that an independent president could fix America’s problems because they wouldn’t “beholden to special interest groups and extreme party ideologies.” Elsewhere in the speech, Schultz argues that an independent could break America’s gridlock on key issues by offering the kinds of solutions you just don’t get in a political system dominated by the far left and far right.
I want to make sure I am not accused of caricaturing Schultz’s views, so I’ll quote part of the speech at length. Here is his entire discussion of health care policy:
What other consequences are there of a hyper-partisan Washington DC that we are living through?
Today, millions of American people are living in fear of losing healthcare or going bankrupt if they get sick. The far Left has called for government-run healthcare, even eliminating the private health insurance market. The far Right has called to repeal the Affordable Care Act for nearly a decade, with no clear replacement, which would leave people vulnerable, especially those with pre-existing conditions, and costs would absolutely skyrocket. Once again, neither is a viable solution.
What’s the truth? The truth is that healthcare costs are the biggest driver of unaffordable care. Yet neither side, extreme left, extreme right has offered and developed any kind of credible plan to reduce costs by increasing competition. Or requiring more transparency on prices from hospitals and drug companies. Or investing in preventive care.
This is a problem that can be solved.
We must bring down healthcare costs while increasing choice and access. The American people deserve so much more than the broken two party system is providing them.
This is wrong in a few ways. One way it’s wrong is factually. Washington is thick with plans to reduce health costs by increasing competition, by requiring pricing transparency, by investing in preventive care. A lot of this was actually done in the ACA itself, and there are plenty of plans floating around to build on those elements of the Affordable Care Act without abolishing private insurance.
But the other way it’s wrong is conceptually. Schultz is a successful CEO, and as businesspeople often do, he is looking at politics as if the president is the government’s CEO. His pitch to the American people is the same as it would be if he was pitching to run a company: “What it will take is something sorely missed in Washington D.C. these days: that’s where I started, and that’s leadership.” His view is he’ll come in, get some smart people in the room, propose the kind of moderate ideas currently being drowned out by the ideologues, and solve all the problems.
But the government is not a corporation, the president is not the CEO, and the US Congress doesn’t work for whoever occupies the White House. All the ideas Schultz has offered require legislation to become law. So who is going to introduce his legislation? He can’t do it, because the president doesn’t have the power. Who’s going to vote for his legislation? Legislators from both parties would see him as a critic and a threat.
Even if everything goes exactly as Schultz hopes, he’ll have just won a presidential election by running against both the Democratic and Republican parties and their tired ideas and braindead ideologies; now they’re going to write his bills for him and give him the votes to pass them?
“A president’s fellow partisans in Congress don’t just want to work together because they agree on issues or answer to the same interest groups,” says Frances Lee, a political scientist at the University of Maryland. “They work together because their political fates are tied together. Schultz or any other independent president would lack that vital resource.”
The government isn’t like a company. The people who Schultz would be asking to pass his initiatives wouldn’t be in his employ, they would be in competition with him, and he would have gotten his job by criticizing and defeating them.
Whatever the flaws in Schultz’s theory of the presidency, he has no theory of Congress at all. He isn’t doing the hard work of building a new political party or recruiting congressional candidates to run on his ticket. Schultz also isn’t doing the difficult work of running in the Democratic primary and trying to change the party from within, as Bill Clinton did in 1992, and Bernie Sanders did in 2016.
Schultz may not like the idea of political parties, but they exist for a reason, they play a central role in passing legislation, and a presidency divorced from a theory of how to pass legislation is not going to be a presidency that solves America’s toughest problems.
Howard Schultz is part of America’s political representation problem
“The truth is,” Schultz says, “our representative democracy doesn’t represent us anymore.”
Schultz frames the villain as political parties, but political parties are far more responsive to voters than the problem that Schultz embodies, but doesn’t discuss: money.
Schultz is taking what Mark Schmitt calls “the billionaire express lane,” and it’s at least as poisonous to representative democracy as anything the two parties might do. The political scientist Nick Carnes has done painstaking work looking at the representation of different economic classes in American politics, and what he finds is that there’s arguably no class as badly underrepresented as the working class, or as overrepresented as the rich.
“The exclusion of working-class people from American political institutions isn’t a recent phenomenon,” Carnes writes. “It isn’t a post-decline-of-labor-unions phenomenon, or a post-Citizens United phenomenon. It’s actually a rare historical constant in American politics — even during the past few decades, when social groups that overlap substantially with the working class, like women, are starting to make strides toward equal representation.”
This is a representation problem with real consequence: Carnes’ research shows that political representatives who hail from the working class are markedly different than those who don’t:
The gaps between politicians from working-class and professional backgrounds are often enormous. According to how the AFL-CIO and the Chamber of Commerce rank the voting records of members of Congress, for instance, members from the working class differ by 20 to 40 points (out of 100) from members who were business owners, even in statistical models with controls for partisanship, district characteristics, and other factors. Social class divisions even span the two parties. Among Democratic and Republican members of Congress alike, those from working-class jobs are more likely than their fellow partisans to take progressive or pro-worker positions on major economic issues.
But Schultz, for all his concern about political representation, isn’t talking about the way money distorts representative democracy, or the way his own wealth might influence his ideas. Nor is he proposing solutions to the way money warps representative democracy.
What Schultz is doing is embodying the way money distorts representative democracy. He is America’s money-in-politics problem in human form, and he evinces no self-consciousness about this even as he claims to be running to improve political representation. It’s breathtaking.
What Howard Schultz could do
At Starbucks, Schultz really did build a company that is kinder to its workers than most, and I take him at his word that a similar impulse motivates this effort. But what is clear is that for all Schultz’s public spiritedness, he has not done the work to understand the problems he decries, or to consider where he could do the most good in fighting them. As of now, Schultz’s campaign is long on ego, short on answers, and so confused about the dynamics of American politics that it threatens to worsen every problem he claims to worry about.
Running as a third-party candidate in a first-past-the-post election system is likelier to reinforce the two-party duopoly, and the dangers of third parties, then to open America to multiparty democracy. Governing as a “centrist independent” free of party would generate gridlock and conflict in a system that is organized around political parties. And taking the billionaire’s express lane into presidential politics, just a few years after Donald Trump did the same thing, would be further proof to Americans that they live in an unrepresentative oligarchy, and the socialists arguing the entire system is rotten have a point.
Schultz says the definition of leadership is “making tough choices for unselfish reasons.” He may think that’s what he’s doing, given the blowback he’s experienced, but it isn’t. The tough choice is the slow, difficult, often frustrating work of organizing toward true political change. The unselfish choice is the one that doesn’t posit himself as the answer to all of America’s political problems, that doesn’t pretend American politics was just waiting for a better billionaire to ride in on his magnificent steed, that takes seriously the mechanics of the system he hopes to reform.
There is a cartoon about another billionaire activist that Schultz’s campaign often makes me think of. In it, Bruce Wayne is walking alongside his loyal butler Alfred. “This city is being overrun by criminals,” he says. “I have the power to make a difference.”
Alfred is thrilled. “It’s so wonderful of you to wish to bring your considerable wealth and resources to bear on such a vital issue,” he replies. “Will you go so far as to involve yourself in city government? Or perhaps set up an early childhood education program in poverty-stricken neighborhoods?”
In response, Wayne turns to directly face his butler. “I want to dress in a bat costume and punch individual muggers,” he growls.
This is more or less what Schultz is attempting. The country could use some public-spirited billionaires who believe what Schultz, at least, claims to believe, and are willing to put the time and money into true political reform. What it doesn’t need is more billionaires who just want to jump into politics and break things.