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Starbucks Anti-Bias Training; Race Relations in America; Trump Imposing Tariffs on Chinese Goods; Supreme Court Rejects Arkansas Abortion Case. Aired 9:30-10a ET
Aired May 29, 2018 - 09:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:30:00] POPPY HARLOW, CNN ANCHOR: Today. 8,000 Starbucks stores across the country are going to be closed all afternoon.
HOWARD SCHULTZ, EXECUTIVE CHAIRMAN AND FOUNDER, STARBUCKS: Yes.
HARLOW: You're going to train 175,000 workers on anti-bias training. Some of that is going to be showing them this documentary by the legendary documentary filmmaker Stanley Nelson, which I watched part of it, where you have young black men and women talking about wanting to walk out of a house and feel as safe as any white person would feel. You're going to have the woman, Sherrilyn Ifill, who heads the NAACP Legal Defense Fund, participating in this training.
What will actually happen?
SCHULTZ: Well, first off, I've gone through the training myself, as has the entire leadership team of the company last week. And we did that so that we could experience it first-hand. It's interactive. It's been co-authored by Brian Stephenson, Sherrilyn Ifill, Heather Mcgee and I think we wanted to try and really get professional people to help us understand and walk in the shoes of people of color and understand that racial bias does exist, unconscious bias exists and what can we do as a company to create the reference points to establish empathy and compassion in a welcoming environment for everyone.
HARLOW: For critics who say, this is an afternoon, how on earth can you tackle racial bias and unconscious bias in an afternoon?
SCHULTZ: Well, I think the most important things to do is, we need to have the conversation. We need to start. We realize that four hours of training is not going to solve racial inequity in America or in -- or in anyone coming into our stores that may have a problem, but we have to start the conversation. We've also said that we are deeply committed to this being a long-term journey which we are going to integrate this training not only in every Starbucks store from this point on, but also the onboarding of 100,000 new people a year.
HARLOW: So this is the beginning of more trainings to come.
SCHULTZ: Yes, without question, and we're going to do this around the world.
HARLOW: What was the gut -- Howard, I've interviewed you for, I don't know, almost a decade now, right?
HARLOW: And this company is as ingrained in you arguably as almost as family. You are Starbucks. Starbucks is you in many ways. So can you just tell me your gut, what did you feel when you realized this happen to these two men because of their race?
SCHULTZ: I was personally horrified by it. I -- when you think about the values of Starbucks providing health insurance, free college tuition, the things we've done for opportunity youth, veterans, refugees, all of these things, for this to happen is such an anathema. But, however, it did happen. And we did not blame the manager. We took full responsibility. I took full responsibility. Immediately went to Philadelphia.
But from a personal level, it was hard for me to actually imagine this could happen at Starbucks. And, in a way, because it did happen --
HARLOW: Why is it hard for you to imagine it could happen at Starbucks? You think of sort of on every corner. And you think about race relations in this country. I mean there was a poll last year that showed that 70 percent of Americans feel like race relations have gotten worse in the last decade.
SCHULTZ: Because the culture and values of the company are so steeped in compassion and humanity. Forty percent of our workforce are people of color. We've hired over 100,000 opportunity youth over the last couple of years. So we are steeped in an understanding of inclusion and diversity as part of the history of Starbucks.
HARLOW: So I think some people watching this right now might look and say, what does he, Howard Schultz, a very wealthy, white executive, know about discrimination? What they don't know is that you were born and raised very poor in a very tough part of Brooklyn. You're a Jewish American. Have you lived discrimination?
SCHULTZ: Well, it's interesting you should ask that question because part of the -- of going through the training is for each one of us, in an intimate fashion, to share our personal life experience. It's our personal life experience that has shaped whether or not we have bias.
I grew up in a building with 100 families with one elevator, 100 apartments, of a very diverse group of people, white, black, Italian, Jewish, Puerto Rican, Cuban and we all had to get along. I did not see color as a kid. And I think one of the reasons why this is such an anathema to me is because the entire company's history is based on the fact that we are all in this together and the inclusion of Starbucks is part of the success of the company.
HARLOW: Were you discriminated against?
SCHULTZ: I was not discriminated against as a kid. When I went to school in Michigan, I was the only Jew in my dorm. Kids had never met a Jewish person. But I did not suffer discrimination. HARLOW: In 2015, Starbucks launched the Race Together campaign. This
was after the killings of Michael Brown in Ferguson, Eric Garner here in New York and the ensuing protests. And you have admitted -- I mean it's when they -- people wrote that baristas "Race Together" on the cups.
SCHULTZ: Yes, Race Together.
HARLOW: That program ended. You admitted that it failed and you talked about people, Americans being so uncomfortable talking about race. But you're doing it again. You're talking about race. You're closing your stores to do it. Is corporate America too scared to talk about race overall?
[09:35:12] SCHULTZ: I've -- you know, what I've said publicly, and I've said this consistently. I said, given the polarization in Washington and the political class of dysfunction that we have experienced for years. That corporate -- corporations, businesses and business leaders have a moral obligation today to do much more for their employees and the communities they serve. And race should be a subject that we should be able to talk about, even though it's difficult.
HARLOW: But are they doing it enough overall?
SCHULTZ: I mean, obviously not. And I think -- I mean what we're doing today is historic. There's no company in America that has ever done anything quite like this.
HARLOW: How much will it cost Starbucks?
SCHULTZ: This will be tens of millions of dollars.
HARLOW: Tens of millions.
SCHULTZ: And it's interesting. I -- you know, I got a call from an institutional shareholder complaining that this is an expense that Starbucks should not make.
SCHULTZ: And what I said was, no, this is not an expense, this is an investment in our people and in our community.
HARLOW: It's also a call you got years ago when you started giving health care to more part-time workers, so --
SCHULTZ: Same kind of situation.
HARLOW: Stay here. We have a lot more to talk about. We'll be right back with Chairman Howard Schultz.
[09:40:19] HARLOW: Back with us is Starbucks Chairman Howard Schultz, on the day that Starbucks is closing 8,000 stores for racial bias training.
Thank you for being here.
SCHULTZ: You're welcome.
HARLOW: There's a really interesting opinion piece on cnn.com right now. It was written by Jesse Williams, the actor and activist, and also Judith Browne Dianis, the executive director of advancement of the projects national office.
Here's what it reads. While Starbucks has taken steps to use last month's incident as a teachable moment for countless employees, these occurrences will continue. The rhetoric from the White House has exacerbated the problem, opening the door to increased overt racist behavior.
Are they right?
SCHULTZ: I don't think in -- what they're stating I think has contributed to the problem, but I think the totality of the issue is beyond the White House.
HARLOW: So has President Trump's rhetoric personally on race exacerbated racism is America?
SCHULTZ: I would say, on a personal level, it probably has given license to people to feel as if they can emulate and copy the kind of behavior and language that comes out of this administration. But having said that, the racial divide and the inequities that exist between people of color and Caucasians in America is a problem that has existed for quite some time.
SCHULTZ: And I think we have to ask ourselves a very important question, and that is, what kind of country do we want to live in? And, from my perspective, we want to live in a country in which we love and respect every American. And you have to ask yourself about the promise of America and the American dream. And if it's not available to everybody, if people feel as if the color of their skin or their station in life is not going to provide them the same opportunity as someone who's white and who has a better zip code --
SCHULTZ: Then the country is not going to succeed in terms of its long-term aspiration.
HARLOW: Economic disparity.
HARLOW: The lack of social mobility. The upward dream that so many people lived, that you lived, coming from east New York, Brooklyn.
SCHULTZ: Yes. I mean I'm -- I'm the poster child of the American dream.
HARLOW: Is there anything -- And I know you've been critical of this administration, but I wonder if you think there is anything that the Trump administration can do, Howard, to help? You're doing what Starbucks is doing today. It's going to cost you tens of millions of dollars. What could the White House do to help close the divide?
SCHULTZ: You know, it may sound a little trite, but I -- I mean it in a very heartfelt way. And I would just say, let's put humanity in the center of our conversation. And if the White House and the president would view, through the lens of humanity, the policies that I think are so important to the future of the country, whether it's immigration, whether it's trade, all of these things have such rhetoric to it and the political class is not helping. I mean we're sitting today, as an example, with almost $21 trillion of debt.
SCHULTZ: In addition to that, almost $500 billion of interest expense. We can't function as a country if the environment domestically is such -- is under such pressure.
HARLOW: But so here -- here's what the president points to, right? He'll point to the lowest unemployment rate we've seen in decades. He points specifically to African-American unemployment is now down to 6.6 percent. It's higher than white unemployment. It's the lowest it's been since 1972. Does he deserve credit for that like he claims?
SCHULTZ: I think -- well, I think when you have 5 million young Americans opportunity youth who are not in school, not in work, many of which are people of color, when you have almost 45 percent of households in America that don't have $400 for an emergency, when you have a mental health crisis in America, when you have a homeless crisis in America, let's go a different way. The most respected, trusted institution in the United States today is the United States military. And yet, at the same time, the probably -- the poster child for the worst government agency, which is a $200 billion budget agency, is the VA.
HARLOW: The VA.
SCHULTZ: How do you square that up?
SCHULTZ: And so I really -- let's take a step back from the politics and the rhetoric and let's ask ourselves, how can we be servant leaders and how can we serve the American people in a way in which everyone has a shot at the promise of America?
HARLOW: Let me ask you about trade because China is your second largest market outside of the United States. It's critically important for Starbucks. It's critically important for the U.S. economy and U.S. jobs given the reciprocal trade that we do.
SCHULTZ: Yes. [09:45:07] HARLOW: The White House, just moments ago this morning, has announced a 25 percent tariff on $50 billion worth of Chinese goods.
HARLOW: Are you concerned about that? Are you concerned it will exacerbate what is already the beginning many say of a trade war? What does that mean?
SCHULTZ: Let's take Starbucks out of the equation for the moment.
I think the history of the country, especially over the last 50 years, every time that we have had a conflict of trade, and there have been trade wars, it has resulted in a downturn of the economy in the United States. This is a policy that is not correct. And I would say --
HARLOW: So it doesn't help U.S. jobs?
SCHULTZ: No, it doesn't help U.S. jobs and it is -- it's political rhetoric and kind of metaphorically, and this is what I really believe, the country and America should not be building walls of any kind. We should be building bridges. We should be creating our opportunity of trust and confidence with our allies all over the world and building bridges with all of the countries in which we want to do business with. This is not the approach we should be taking.
HARLOW: Is 2020 out of question for you, Howard Schultz? Is --
SCHULTZ: Are we going to go there again?
HARLOW: As someone who talks about -- in any way, not just as president, is there any way that serving in the government is still in your mind from 2020?
SCHULTZ: What I would say is that I'm as concerned an American citizen as I ever have been. I want to be as involved as I possibly can as a citizen to help the country. I don't know what that's going to mean in the future.
HARLOW: I appreciate you being here.
SCHULTZ: Thank you.
HARLOW: Thank you very much.
SCHULTZ: Thank you.
HARLOW: Thanks, Howard.
SCHULTZ: Thank you.
HARLOW: Thank you.
All right, much more on those new tariffs. That breaking news out of Washington.
We'll be right back.
[09:51:14] BRIANNA KEILAR, CNN ANCHOR: We are following breaking news.
The White House slapping China with 25 percent tariffs on $50 billion worth of goods. It's a major reversal from just a week ago after saying it would hold off on levying tariffs on China while the two countries negotiate a trade deal.
Joining me now, we have CNN Money chief business correspondent Christine Romans.
I mean this is a reversal, Christine.
CHRISTINE ROMANS, CNN MONEY CHIEF BUSINESS CORRESPONDENT: It really is. And this developing just really moments ago, Brianna. You know, you'll recall it was a week ago the Treasury secretary, Steven Mnuchin, says the trade war with China was on hold. That they were pressing the pause button on tariffs while they worked to execute the framework for trade talks overall with China. We know the commerce secretary, Wilbur Ross, will be meeting with European trade negotiators in just a few days. And we know that there have been talks ongoing about what to do about -- about the China situation.
And then this. This statement from the U.S. where it talks about China's discriminatory and burdensome trade practices. The United States will impose a 25 percent tariff on $50 billion of goods imported from China containing industrial, significant technology, including those related to the Made in China 2025 Program. That is a program domestically in China to develop really intense technology sensitive sectors in its economy that other countries have claimed it unfair and they're subsidizing unfairly their own domestic industries.
Also here, the United States is going to list those targeted goods by June 15th. So very quickly here. And then by June 30th, the White House is saying they're going to announce investment restrictions and they're going to strengthen capital controls so China can't buy up -- just buy up industrially significant technology from the U.S.
So this is an effort by the United States to protect United States technology and intellectual property and clearly an important sticking point of what had been negotiations with the Chinese.
You can see stock market is down here. It hasn't (ph) gone (ph) above (ph) 150 point because of concerns about Europe and Italy. Some political upheaval in Italy. But then after this news of these tariffs, 25 -- $50 billion in tariffs, 25 percent tariff on $50 billion of goods, you saw the market hit its fresh lows here, Brianna.
KEILAR: Wow, what a difference a week makes.
Christine Romans, thank you so much for that.
ROMANS: You're welcome.
KEILAR: We also have some breaking news that I want to tell you about coming to us out of the Supreme Court.
The high court just rejected a challenge to a controversial Arkansas abortion law.
Jessica Schneider is there with the very latest.
Tell us what this means, Jessica.
JESSICA SCHNEIDER, CNN JUSTICE CORRESPONDENT: Well, Brianna, as we approach the end of the term here toward the end of June, the Supreme Court today making headlines for something that the court has decided not to do. The court saying today that it will not hear arguments on this controversial Arkansas law that restricts abortions.
So this law was passed in 2015. And Arkansas said that if you were getting an anti-abortion drug that the physician who prescribed it to you had to have contact or had to have a contract with a physician with admitting privileges at a nearby hospital. So, as a result of that law, Planned Parenthood sued, saying this was unconstitutional, it placed an undue burden on women who were seeking abortions, saying that some of the nearest clinics, if this law were to take effect, would just be too far away for these women who needed it.
This all involves an anti-abortion drug that's only prescribed early in a woman's pregnancy. So the Supreme Court today, this has gone through the lower courts here. This has gone through the district court in Arkansas. This has gone through the 8th circuit. The district court actually allowed -- did not allow this law to go into effect. The 8th Circuit then reversed that decision.
So the Supreme Court now saying that this is going to go back to the district court in Arkansas, putting this in the federal court's hands in Arkansas. However, if nothing is done at that lower level, this law could go into effect in Arkansas within 45 days. So we're looking at about July.
[09:55:09] So the Supreme Court here saying, we are not going to act on this. We are going to leave this in the district court's hands in Arkansas. And, again, Brianna, this all pertains to an abortion law. We've seen laws like this in the past where states restrict certain aspects of abortion. In this case, the anti-abortion drug must be prescribed through a physician that is contracted with another physician that has admitting privileges at another hospital. So Planned Parenthood here says this makes it too difficult for women.
So this is all an ongoing, legal battle. But for now, Brianna, the Supreme Court will not be hearing arguments on this.
Back to you.
KEILAR: So the -- is the expectation here, Jessica, that ultimately this is a -- this is going to be a victory for anti-abortion activists, once we see what happens at the lower court and certainly not for Planned Parenthood?
SCHNEIDER: It could be. And that's Planned Parenthood's concern here. They're saying that they wanted the Supreme Court to hear this, because the Supreme Court actually heard a similar case several years ago where they said a Texas law that had restrictions on abortion placed undue burden on the women. So Planned Parenthood was hoping a similar outcome would be reached today at the Supreme Court, or at least that the Supreme Court would agree to hear this case.
But, yes, that's the concern from Planned Parenthood, that if it is sent back to the lower courts in Arkansas, that this law could go into effect as soon as July.
KEILAR: Jessica Schneider, thank you so much for breaking that down for us.
To meet or not to meet, that is the big question right now for President Trump and Kim Jong-un. Now, North Korea's former spy chief is coming to the United States. Could the summit be back on track?
HARLOW: Also, the president tweeting this morning, new, unfounded conspiracy theories about Robert Mueller's team. We're on all of it straight ahead.