Everything but the Coffee (32 page)

Starbucks named its fair-trade coffee, a blend of Central American and East African beans, Café Estima. This is another clue to the company’s approach to globalization. In Spanish
estima
means “esteem.” But who gets the esteem? According to José Alvarez, a Venezuelan born-scholar of Cuban literature who runs study abroad programs in Latin America, the farmer pictured on the label could be the one getting the esteem. Just as likely to earn the esteem, he told me, given how Starbucks uses the word, are the customers. Through buying the blend, they get to say something about themselves and how they want to be seen. They say that they are the kind of people who care about the least fortunate and have enough money to spend to give poor farmers in some distant place a boost. But they also get to dissociate themselves, and show their innocence, from the causes of those same farmers’ poverty and the discontent that goes with that situation. By buying fair-trade coffee, they are doing their small part to reduce global inequities
and give, in Starbucks’ words, “farming families a better life and insure coffee farms are protected for the future.”
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For that, Starbucks tells them through the name of its coffee blend, others should hold them in high esteem, or
estima
.

Beginning in 2001, Starbucks made it easier—or so it said—to spread the esteem and do a little something to reduce global inequities. That year the company debuted its own in-house sourcing system. In many ways, it amounted to a corporate takeover of fair trade. According to Starbucks, the company “saw a need for it
”—it
apparently being a system that paid farmers more money that wasn’t the fair-trade system already in place. Developed in tandem with Conservation International and Scientific Certification Systems, Coffee and Farmer Equity Practices, commonly known as CAFE Practices, explains the company Web site, established “guidelines . . . to help us work with farmers to ensure higher quality coffee and
private
[my emphasis] equitable relationships with farmers, workers and communities as well as protect the environment.” Under the plan, growers first had to show that they could produce consistently high-quality coffee. Knowing that some consumers associated fair trade with bad coffee (consumers got this idea, in part, from Starbucks), Starbucks stressed the taste of CAFE Practices beans at every turn. After demonstrating the quality of their products, growers must fill out stacks of paper, showing how they treat their workers, harvest their beans, and interact with the environment. Auditors then come out to the farms to look at how the farmers handle the beans, deal with agrochemicals, house their workers and families, and regulate things like child labor. Based on the reports, Starbucks grades each farm according to twenty-eight separate categories to determine a score from 1 to 100. Growers with the highest marks receive, the company reports, “preferred buying, higher prices, and better contracts.” Starbucks executives are dedicated to their system. While in 2007, only 6 percent of the company’s coffee came from fair-trade-certified farmers, 65 percent of the more than 360 million pounds of green beans Starbucks purchased came from growers enrolled in CAFE Practices.
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According to Starbucks, consumers in the developed world are, of course, the chief beneficiaries of CAFE Practices. Again, the sourcing system ensures quality first, telling creative class customers that they can have it all: richer, deeper, and more complex blends; happier, healthier, better-paid, and politically tamed workers; and a cleaner and more sustainable environment. All you have to do is pick the right product from the right company—“a company doing,” according to its Web site, “business in a different way.” But to get this access—and the esteem that goes with it—you have to pay an added premium, one that isn’t necessarily passed down to the people on the ground.

THE ETHOS OF PAYING TO FEEL GOOD

Commodity prices—how much farmers get for coffee—aren’t the only issues plaguing families in the developing world. Many struggle to find clean, drinkable water. Coffee farmers have it worse than most. The waste from the sticky red coating around just-picked beans can be toxic and if not properly handled pollute the water supply. Just as environmentalists started to point out this problem, health-conscious bobos from Boston to Santa Barbara, places where water remains generally clean, changed—quite conspicuously—their own drinking habits. They started paying for bottles of water and taking them everywhere they went. Writing in the
New York Times Magazine
, Jon Mooallem compared these sixteen-ounce clear plastic bottles to adult security blankets. One person told me that he now feels slightly self-conscious using a water fountain, worried that a drink from there will mark him as lower-class. In 2006, Americans spent fifteen billion dollars on takeaway water.
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Everywhere you go these days there are stacks of individually sized water bottles. Gasoline stations and supermarkets carry water, so do vending machines at airports and hot dog stands at ballparks, and so do dough-nut shops and coffeehouses.

Starbucks customers, of course, demanded their bottles of water, too. In 2005, Starbucks decided to cut out the middleman and boost its prof
its by buying its own supplier. That year it purchased Ethos Water. With the acquisition, Starbucks got its own water source and a product that came in a slick, slender bottle. But what it really got—and really wanted—was the global narrative of Ethos selling water, in the words of one journalist, to “the rich to help the poor.”
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With each purchase of Ethos Water, Starbucks donates five cents to provide “clean water to some of the world’s poorest countries.” “Helping children get clean water,” announced an in-store sign over a wicker basket full of Ethos bottles. Under it, there was a picture of nine-year-old Anita. “Access to sanitation at her school,” it explained, “has helped improve health conditions in her community and dramatically changed her own education.” After visiting Ethiopia, Starbucks’ vice president for social responsibility, Sandra Taylor, told her boss Jim Donald another Ethos success story. For as little as twenty-five hundred dollars, she recounted, Starbucks built a well that “revolutionize[d] the lives of women aged 6 to 16 because they’re the ones who do the carrying of this water now.” With easy access to water, these women would, Starbucks promised, “be able to learn to read and go to school and do things we take for granted.”
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By 2010, the company pledged to contribute ten million dollars to fund water projects around the world.

Just as it does with CAFE Practices, Starbucks promised that consumer action—that is, buying (“what we do, you do”)—can make the world a better place and make the beneficiaries of this largesse like us. It makes customers part of the solution and, even more, not part of the problem. But absolution doesn’t come cheap at Starbucks—it never did.

Typically a bottle of water at a coffee shop costs between $1.20 and $1.50. At Starbucks, you pay $1.80 for Ethos Water—water that is no different in terms of taste or purity than other waters. That means that after making its five-cent donation to the world’s water deprived, the company still gets an extra twenty to fifty cents per bottle of profit. In a sense, then, they charge you to help the least fortunate. So while you get to feel good about yourself for doing your part, Starbucks gets added profits.

The Ethos Water program isn’t the only time Starbucks charged its customers a premium for its blend of esteem and innocence. In the spring of 2007, New England–based reporter Bill Kirk noted that Starbucks charged $3.55 for a large latte, while Dunkin’ Donuts charged $3.05. “However,” he calculated, “the latte at Dunkin’s is bigger—20 ounces compared to 18 at Starbucks.” Kirk asked Starbucks spokesperson Jennifer Guebert why her company charged more for less. She led the journalist to believe that the price the company paid for its beans accounted for the 16 percent cost differential. “The key guiding principle is the relationship we have with farmers and the communities they live in,” Guebert said. “We pay premium prices for that coffee, and we want to make sure it makes a profit for the farmer.”
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What she didn’t say—and what Kirk didn’t seem to know—was that Dunkin’ Donuts used 100 percent fair-trade-certified beans for its espresso-based drinks. Even if Starbucks paid 10 or 20 or even 30 percent more for its coffee than its competitor—and it is doubtful that it did—that would add up to about forty cents a pound, a dime less than the price difference of a single drink. But that’s just one latte. A shot of espresso, the coffee in a latte, uses about fifty beans. Breaking this down, a pound of coffee contains enough beans for roughly fifty shots of espresso.
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That’s quite a multiplier for Starbucks, and to a lesser extent for Dunkin’ Donuts. When you do the math, then, it is clear that Starbucks, not the farmers, is the one raking in the profits on its lattes. But that isn’t the story that Guebert told; she talked about Starbucks serving the needs of the global community.

Charging more while casting itself as a virtuous international actor isn’t new at Starbucks. In 1993, the company offered a “CARE sampler” in its mail-order catalog. “When you purchase this sampler of four distinctive coffees,” the company pledged, “we’ll donate $2 of your purchase price over and above our annual grant”—then a hundred thousand dollars per year—to CARE programs to improve children’s health and battle illiteracy around the world.
Consumer Reports
noticed that the CARE sampler cost exactly two dollars more than the other samplers in
the catalog. A Starbucks spokesperson admitted that the extra money was exactly the money going to charity. In other words, the company didn’t really donate anything out of its own pockets, but people who didn’t read the fine print could easily have mistaken Starbucks for a selfless and different sort of corporation.
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RWANDA

Even in a place like Rwanda, Starbucks claims it can help, but again consumers have to pay a premium. In the mid-1990s, genocidal rage turned the former Belgian and German colony into a killing field. The Western democracies decried the bloodshed and sent some food, but they didn’t do much else. Hundreds of thousands died, in part, as a result of this inaction. Today the violence in Rwanda and the larger region has subsided somewhat, but severe economic, social, and infrastructure problems remain. The country does not have nearly enough roads or bridges or banks or credit. Because of this, it is one of the world’s poorest places. Annual per capita income barely reached a thousand dollars in 2000. The rate of infant mortality is even more startling: a fifth of all babies born alive in Rwanda each year end up dead. Most men cannot expect to live past forty.
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What Rwanda does possess are excellent conditions to grow high-quality, complex-tasting coffee beans. Through much of the 1990s, NGOs and government agencies in the United States and Europe worked with the government there to develop the country’s coffee business and give small farmers a chance to climb out of poverty. They had to start at the very beginning. Rwandans generally don’t drink coffee, so aid workers taught them how to cup and taste beans to check for quality. Agronomists provided information on soil and fertilizers, and others delivered lessons on the export economy. In 2005, Starbucks stepped in to do its part to assist the battered nation when it introduced its Rwanda Blue Bourbon blend as one of its “Black Apron Exclusives.” “Taste a special coffee,” an in-store sign said, “that’s helping transform farmers’
lives.” “A Promising Future in Every Pound,” a company press release heralded.
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“Following the devastating events of 1994,” a store sign explained rather vaguely, alluding to Rwanda’s troubled past, “this new cash crop has given Rwandan farmers hope for a better future and helped them afford better education, medicine, and housing.”

Better lives for farmers, even in Rwanda—that’s what Starbucks’ version of globalization promised. But again, the company asked its customers to foot the bill. Starbucks charged twenty-six dollars a pound for its Rwandan Black Apron coffee. But it didn’t, as Michigan State professor Dan Clay, one of the key government players in the postgenocide redevelopment of the country’s coffee business, told me, “pass this on to the farmers.”
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Dub Hay, Starbucks’ head of coffee procurement, essentially confirmed this point when I met him in his office at the company headquarters. “No, we didn’t pay any more,” he admitted.

Turns out, Starbucks didn’t buy its Rwandan coffee from cooperatives or organized groups of small farmers, even though several existed in the country at the time. Some of the beans, one source told me (who insisted that I don’t use his name because he occasionally does business with Starbucks), came from “plantations.” When I asked him what he meant by this term, he fired back, “Exactly what you think I meant.” Starbucks purchased most of its Rwandan green beans, it seems, from large estate holders and from middlemen who bought coffee from individual small farmers. Many of the beans, then, were nameless and faceless. They couldn’t be tracked back to the exact place they came from—providing information, for instance, about labor conditions and sustainability. What’s more, while the Starbucks’ intermediaries may have paid a decent price for Rwandan beans, they surely didn’t pay as much as several politically progressive smaller U.S.-based roasters, with higher overheads, did.
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•  •  •

“I was perhaps God’s gift to coffee,” Paul Katzeff proclaimed to author and coffee authority Mark Pendergrast. In Katzeff’s eyes, God looked
more like Che Guevara or Daniel Ortega than Jerry Falwell or Ronald Reagan. Frustrated when he couldn’t make an impact fast enough in his job as a social worker, the New Yorker moved to Aspen, Colorado, in 1969 to open a coffee shop. A few years after that, he settled in Northern California and started roasting his own beans and selling them through a mail-order catalog. Launching Thanksgiving Coffee didn’t blunt Katzeff’s left-leaning politics. When the Sandinistas challenged the pro–United States, pro–big business, anticommunist Somoza regime, Katzeff headed to Nicaragua. He imported coffee from the country’s small farmers and donated a portion of the proceeds to the revolutionaries. Several years later, he poured “blood”—red paint—over the dais at a meeting of the specialty coffee association, protesting against the group’s reluctance to sell only “just” coffee.
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