Keep The Doggone Latte Jet

Keep The Doggone Latte Jet!

By C. Edmund Wright

As we learned, the Starbucks executives took delivery on a new G5 (45 million dollar Gulfstream Jet) in the same quarter they closed a bunch of stores and laid off a lot of employees.

And then, with the new jet smell still thick in the cockpkit,  they flew the thing to Hawaii  where the execs could spend some more company money - monies obstensibly available in part due to the massive store closings and lay-offs.  Good. All this is very very good for the economy.

Remind me to start going to Starbucks more often. 

Oops.  Hold the Kona.  Now the executives say they are going to cave in to public and governmental pressure and sell the jet. Well doggone it. Bad idea.

This country desparately needs to support the kind of in-your-face capitalism represented by keeping the jet, especially in an economic slow down. This is not to support any actions by the Starbucks execs that runs counter to the welfare of the stockholders of Starbucks (more on that later).  It is simply to point out that our entire culture has turned sour on the whole idea of profitable capitalism it seems. 

The last President who made people proud to own a business and turn a profit was Reagan.  It  seems like all we have these days are wimpy scared business people dashing in front of the winds of political correctness at every opportunity.  Case in point are the Big Three Auto execs all piling into some ridiculous hybrid egg beater to go to Washington to be lectured by a bunch of senators who can't even run a dining room.

But frankly, buying that jet is more than just cowboy capitalism. It is sound economics that is a heckuva lot better stimulus plan than anything coming out of Washington these days.

Consider: by placing the order for the Gulfstream, the Starbucks corporation guaranteed a lot of high tech manufacturing jobs for a considerable period of time -- since these planes have to be special ordered and take many months to build.  Good high paying jobs in fact that allows Gulfstream employees to go buy four dollar coffees for example.

Of course, this order was placed long before Starbucks knew their business would suffer and their stock price would plummet. But you can't walk into a showroom and pick up a Learjet or G5 on a moment's notice afterall, so this uber-toy was ordered in the good times of a few years ago.

However: delivery was taken - and paid for -- in a severe recession. We need more of this going on.

This is economic stimulation that actually works.  There is a lot of comparing our economy now to that of the 1930's.  So much so that our current President elect has promised to do what FDR did in the 30's, which was an abysmal failure. It was not until FDR's military started buying airplanes in the 40's (and tanks and guns and ships) that the economy pulled out of its funk.  Buying airplanes is a good thing for the economy!

Ok, so it might have indirectly cost a few jobs for the latte pushers. Aren't these the kind of "hamburger flipping" jobs that liberals make fun of anyway? Isn't that a small price to pay compared to high paying jet building jobs? Econ 101 says yes indeed.

All of which is beside the point.  People start business ventures for one reason and one reason only; to enrich the stockholders. At the start, the initial stockholder is the person who comes up with a crazy idea that most of his or her buddies think will never work.

If the company grows and becomes a publicly traded one like Starbucks, the company must continue to work in the best interests of the now enlarged stockholder population. And frankly, had the huge push back against the jet come from Starbucks stockholders, I would have no problem with it. That is how it should work. Stockholders, and only stockholders, have any legitimate grip with this purchase.

Stockolders' benefit is why businesses exist for their entire life span, no matter how big they get or how long they last. If they happen to create some jobs and opportunity for other people along the way, that's great. In fact, it is necessary to grow.  And many companies do so while creating thousands of fabulous jobs and providing interesting employment and stock option opportunities for growth and income for those workers. But that is NOT WHY they were started.

They exist for the enrichment and pleasure of the folks who had the idea and took the risks and who likely worked for months or years without pay.  Period.  And this includes having total discretion over how revenues are deployed.   Afterall, if the big pay-out and total control were not possible, nobody would go through the pain and risk and ridicule of starting innovative "outside the box" companies.  I would have been first in line to make fun of the idea of four dollar coffee. I am also first to congratulate Starbucks' founders on knowing what they were doing and on their outstanding execution of that plan for many years.

Thus, it is none of my business what they do with their revenue and how many people they have to fire to preserve that revenue. And it is none of Chuck Schumer's business either. If you don't like it, just get your coffee from Border's or Krispy Kreme. Starbucks did not earn one dollar for that jet through coercive taxation, which is where all of Schumer's money and power comes from.

And this is a distinction most people have lost. We have no choice but to put up with the greed, incompetence and ignorance of the government, but we can easily choose to never contribute one dollar to Starbucks corporation if we don't like how they are running their business. And yet, so many are so fast to support government's increasing say in how business is done.

I tremble for the future of this country is our government insists on removing the end game pay-off for entrepreneurs through high taxation and regulation, not to mention attempting to bring shame to successful folks when they stimulate the jet building economy or yacht building economy or any other high end product. Or perhaps start a plumbing company in Ohio.

The Starbuck's business model was to over charge for overly strong coffee that takes way too long to make and to do so by having a store on almost every block across the country. Yet they were saavy enough to make this "crazy idea" an astounding success. Meanwhile, a bunch of lawyers and bureaucrats who have proven their inability to balance a budget for decades and who have demonstrated ignorance of how enterprise works time and again are going to tell them how they have to spend their money.

Enough is enough. Starbucks stockholders should decide the fate of their jet and tell the senate to leave them alone until they can run their own dining room.  But they won't do it. At root, they are a liberal corporation responsible for supporting the very philosophy that is insisting they sell the jet.

Apparently, the only businesses left in America with the cojones (pun intended) are Girls Gone Wild and Hustler, whose CEO's Larry Flynt and Joe Francis said they would accept some TARP funds but already had a plan and did not need the government having a say in how they runs the businesses.