Lattes and Letters

This week Starbucks and Arizona State University announced a joint tuition-degree type-ish plan. I am not sure what to call it because it’s a hybrid of what we consider employee sponsored tuition reimbursement plans, workforce development programs at universities, and some kind of technofuturist vision of higher education access. So, in the way of my people, I’m just adding “-ish” to the term and moving on.

Goldie Blumenstyk did her good reporting thing over at CHE by following the money in the corporate-uni deal. To quote Goldie quoting ASU leaders who should know:

Starbucks also had said that the program would include an upfront “partial tuition scholarship,” thanks to an “investment” from Starbucks and ASU. Ms. Harper on Monday said she was “not able to disclose the specifics of the financial arrangement” of that investment.

But according to Arizona State’s president, Michael M. Crow, “none” of the funding for the upfront scholarships is coming from Starbucks. It’s coming from ASU.

Sara Goldrick-Rab is already on it with a critical interrogation of the ASU online division’s for-profit* profit-generating status as well as the efficacy of online instruction for diverse student groups:

“ASU Online is a profit venture,” said Goldrick-Rab. “And basically, these two businesses have gotten together and created a monopoly on college ventures for Starbucks employees.”

Tweep @MattinToledo offered us a copy of Starbuck’s former tuition reimbursement plan (starting on page 194; yes, 194).

The gist of it all seems to be that ASU gets a captured student-consumer audience in exchange for tuition discounting at its for-profit online division. Starbucks gets to constrain educational choices of employees that choose to use their benefit to a provider that will never conflict with an employee’s work schedule. It’s prognostication, of course, but it seems that lower income employees who qualify for the most need-based student aid will pay less for the online degree program than will those who qualify for less.

And, this is all dependent on student aid access (which pays the bill upfront), persistence (which is complicated by working, class position and other social locations), and keeping your job. My read of that is Starbucks gets to minimize its contribution to tuition assistance by funneling aspirational student-workers into the student aid system and ASU gets to extract profit from student aid on a sliding scale where lower income students are the most profitable human widgets.

What a strange, unique business plan…that was perfected by for-profit colleges thirty years ago.

That plan goes something like this: maximize constrained educational choices that are a function of labor market changes; commodify inequality by organizing for the highest need students; extract guaranteed funds from public coffers; call it access; wash and repeat.

I’ve argued vehemently for progressive taxation of the private sector to fund higher education. This isn’t exactly what I had in mind with increased corporate responsibility.


*Doug Lederman made a good point about the distinction between for-profit (the classification I often work with) as opposed to profit generating. I move between the two analytically in one post. D’oh. It’s one of those fine points that matters most probably to a few people but worth making. So, I’ll call the online division profit generating to be clear.

19 thoughts on “Lattes and Letters

  1. I’m glad someone investigated this. I’m in a rather unique position: I worked for Starbucks for six years and now work at a non-profit online graduate institution, so I questioned everything about it. Both Starbucks and the collegiate culture are about maximizing their bottom line while appearing to seem trustworthy and helpful, when their aims are typically maintaining the status quo while separating folks from their money. I’m glad someone’s asking the right questions about the arrangement. The problem? How can we get Arizona Starbucks employees to ask these questions, too? (Not that they aren’t but when a desperate person hears this, they may think it’s their only/best option)

  2. One of my friends didn’t go to college right out of high school because of family issues, and instead went straight into the workforce as an office assistant. Fifteen years later she finally accepted that she had to go to some kind of school or she would never work her way into any higher-paying employment. She was talked into the University of Phoenix, went to night school and took online classes, graduated with more than $20K in debt, and is still an assistant, four or five years later, worse off than she was because her salary has stagnated and she’s going to be paying off debt basically forever. A for-profit college degree is not worth the paper it’s printed on. Go to the Frontline website archives and watch the series on such schools and how they scam the government for student aid funds. Jack Welch, the former CEO of GE and a royal jerk, has been a huge investor in them, which tells you all you need to know.

  3. Starbucks gets to constrain educational choices of employees that choose to use their benefit to a provider that will never conflict with an employee’s work schedule.

    This, I think, is a key point. The retail and service industries increasingly expect 24/7 availability even from part-time (often c. 29-hour-per-week, to avoid any possibility of having to contribute to health insurance) workers. My students (at a regional state u with a large proportion of first-generation college students, and first-generation Americans) increasingly offer the excuse that they missed class because they “had to go in to work.” I’ve even had the occasional student *leave* class because they were summoned, by text, to work. One can say that they should value their educations more, but they need their jobs to pay for their educations, and their jobs demand availability. I don’t think it’s even necessarily the fault of next-up-the-chain managers unsympathetic to the desire to earn a college degree; increasingly, I suspect, scheduling approaches are dictated by managers (or algorithms) much further up the chain of command. Many students recognize the catch-22 they find themselves in, and those who can afford it may even quit jobs that are interfering with their studies. If and when the economy improves, the number of student-workers making that choice, or at least pushing back against the current scheduling regime, are going to increase. This move allows Starbucks to get ahead of that curve — or at least I’m pretty sure that’s what they hope it will do.

    All in all, I think Temple has a better solution: pay students to work fewer hours ( ). That’s a good solution to the time-to-degree problem, but wouldn’t, of course, benefit Starbucks, which, when push comes to shove, mostly wants reliable — and flexible — workers .

  4. I, too, have many students with on-call work schedules that affect their ability to attend classes. Seems to me this serves the employers by making education even more subordinate to work, and by providing fewer options in the benefit.

    Frankly, the plan also reminded me of that guy in the film _Idiocracy_ who has a law degree from Costco.

  5. Yeah the whole thing smacks of tokenism and self interested parties. Sad. Howard and Oprah could actually do something real. But they are hyping Oprah’s tea to mom’s in “support of moms” and keeping education insular…and not at all progressive. It’s how to keep a cog in the machine. Henry Ford did this type of thing too. Oprah should be book clubbing about LeVar Burton’s Reading Rainbow making a come back and bring it back to public television, not quarantined to online audiences, if she cares at all about literacy and education for all and Howard who kisses Oprah’s feet should link his empire to that kind of sharing. Because it’s about the love of books…and learning to read is freedom…
    I’m glad you are taking this giant on, Tressie.

  6. Prof. Cottom, I’m curious about where you think the Starbucks plan sits among other corporate tuition support programs (like those listed at

    The Starbucks/ASU plan is, as you and other commenters note, an attempt to allow Starbucks to offer a perq that costs them little but provides enough value to employees to help with recruiting and retention. However, this is true of all such corporate tuition support schemes.

    Reading that list of Fortune 500 firms’ tuition support models, the general tradeoff seems to be generosity vs. flexibility. Most firms put fewer restrictions on school (and even the programs with special deals with one school allow less generous terms outside the system.) However, most firms also restrict degree to anything thought to be useful to the firm, which Starbucks does not do, and offer less overall support than Starbucks does (certainly for juniors and seniors, and to a lesser degree for Frosh and Sophomores.)

    So do you think that the Starbucks/ASU plan is just another version of the corporate generosity/flexibility tradeoff, or do you think it is uniquely problematic and troubling in a way that other similar programs are not? (And, of course, troubling in a way that companies that provide no tuition support are not?)

    1. First, I don’t have a job Clay. So, please, just Tressie.

      I think two things. I think this is a version of the typical “life and wellness” benefit plans that are typical of corporate arrangements today. It’s only perverse in the sense that it is more transparent than most. When juxtaposed with the “social good” hype the program *feels* more insidious. I suspect that is why it resonated with so many people. But, I don’t think the plan is too significantly worse than other corporate tuition arrangements. That was actually the point of identifying the parallels with for-profits, which leads me to my other thought on the matter. They’re similar because they are both a function of the macro processes shaping all corporate-worker benefits. It’s just an iteration of shifting responsibility for managing “human capital” to individuals, which in turn shifts responsibility to the State. This program is being subsidized by student aid and a state university (or, in what I suspect would be a minority of the cases it shifts it to family wealth). That’s something but I don’t think I’d call it a corporate benefit. It’s a fancy game of cups that they used to play on 125th street in NY before Giuliani “cleaned” the city up.

  7. This is all about traditional academia being insular and elitist, as it always has been. Anyone coming on to their traditional turf is viewed with great suspicion and often held up to ridicule. If traditional higher education had been meeting the need of all the potential and current students in America well, the for-profit universities would never have come into being. They started because someone saw the need, and millions of students have taken advantage of the opportunity – some successfully and some not so successfully. Some have left those schools with high debt loads and difficulty paying the debts back; others have left with little or no debt or have been able to pay off their debts successfully. Some graduates (about 1/3) are very satisfied with their for-profit educations and the way their education has been received in the working world, another 1/3 aren’t very satisfied, and still another 1/3 are “waiting to see.” That all sounds to me like just about what you would hear from students and alumni at any state college in the country.

    I earned my doctorate from a for-profit university that was an exhausting and grueling 4 1/2-year journey ending with a substantial dissertation that I am very proud of. The only difference from a traditional doctorate was not spending another 3 or 4 years as a lab assistant and TA to some professor working on his or her research project for her. I also have taught for the past 13 years at a for-profit university, a private non-profit university, and a state university’s “profit generation” arm. I can easily tell you the for-profit school has the most rigorous program, the best support for both students and faculty, the best faculty development, the most faculty involvement, and the closest faculty-student interaction. Just remember, for-profit schools are not some giant monolith – they run the gamut from large 4-year institutions with doctoral programs to matchbook art schools. You can’t compare one to the other as equals.

    For the poster whose friend got a degree (2-year or 4-year, I’m not sure) from University of Phoenix and is still an assistant – it’s not the degree that gets promoted, it’s the person. The economy is tough right now, and just having a job is a good thing. But simply getting a degree from anywhere doesn’t mean she deserved a promotion. She needs to prove she’s deserving and capable of handling the promotion, so she needs to look at herself, not at her university, if she’s looking for reasons why she hasn’t been promoted. Introspection is always difficult, but that’s why they call it work. My degree has helped me open many doors, but my success has been because I’ve chosen which doors to walk through (and which not to) and what I’ve done after I walked through them.

    For-profit schools are here to stay, no matter how much the Dept of Education and Tom Harkin would like to get rid of them. Now, state schools are emulating their success by doing the exact same thing, only they are going to stress their existing systems and try to do too much without understanding the resource requirements it takes to do online learning and teaching well. It will be a very expensive lesson for ASU, I suspect. Many other state schools are already either deep into, or dipping their toes into online “profit generation” centers. UMUC has been doing it for years; others are following apace. Soon, you’ll be able to make some real comparisons between online schools and who is doing it well and who isn’t. I guarantee you some for-profit universities will stand head-and-shoulders above many of the state online programs in terms of quality and student satisfaction, and probably in gainful employment and debt measures, too.

  8. Oh, and back to the original story – why do any of you care? Unless you work for Starbucks, are one of the faculty members at ASU that is going to be pushed into teaching more students, at least at first, or an Arizona taxpayer who is footing most of the bill for this, what dog do you have in this fight? If the workers like it and take advantage of it – good for them. If they don’t like it, they won’t take advantage of it. It it turns out well for the company, good for them; if not, too bad. Same for ASU, except any loss for them goes to the taxpayers from their state and the parents of future students who will absorb the next round of tuition hikes.

  9. Seems like an excessive reaction to something that is relatively harmless. I’m more concerned about schools, many of them non-profits, that admit students they know will have little chance of graduating. These students are thus saddled with debt and little hope of paying it off.

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