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CNN LIVE EVENT/SPECIAL

Poppy Harlow Hosts Howard Schultz in a Houston Town Hall. Aired 10-11p ET

Aired February 12, 2019 - 22:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


POPPY HARLOW, CNN HOST: Good evening from Houston, Texas and welcome to a CNN town hall on the 2020 presidential race with Howard Schultz. I'm Poppy Harlow. I'm so happy to be with everyone tonight. An unexpected twist on the road to the White House. The former CEO of Starbucks says he is seriously considering an independent bid for the presidency. Mr. Schultz has already shaken up this race, sparking outrage from the left and taunts from President Trump. Well, tonight, Mr. Schultz comes face to face with you, the voters, participating in his first-ever live televised town hall.

He will take questions from across the political spectrum, from Democrats, from Republicans, of course, from Independents. So let's get started. Please welcome Howard Schultz.

(APPLAUSE)

HOWRD SCHULTZ, FORMER STARBBUCKS CEO, 2020 PRESIDENTIAL CANDIDATE: Thank you. Thank you, thank you.

HARLOW: Thank you. Welcome.

SCHULTZ: Thank you very much. Thank you.

HARLOW: What a great crowd. Thank you, Houston, for having us. Welcome.

SCHULTZ: Thank you, Poppy.

HARLOW: Welcome. All right, so we're going to talk about all the issues, because that's what this is about. It's about the important issues that matter to Americans the most. But before we do that, a lot of Americans don't know you and they don't know your story. So that's where I want to begin tonight. And to do that, I'd like to bring in Joyce Olewe, who is an immigrant from Nigeria. She is now a graduate student in Rice University's global affairs program. Good evening.

QUESTION,: Good evening.

SCHULTZ: Good evening.

QUESTION: Mr. Schultz, you're coming into the 2020 presidential race not having any prior political experience but solely as a successful businessman. That was what Donald Trump ran on as his advantage over other seasoned politicians who were his opponents. How do you differ from him in this regard? Do you think your good business sense qualifies you to do a better job than he? If yes, how so?

SCHULTZ: Well, thank you very much. I really appreciate that. Poppy, thank you, thanks, CNN and thank you all for being here. Thank you for the question. You know, I'm not coming into this thinking about comparing myself to Donald Trump. I think his record and what he has accomplished within the Oval Office speaks for itself. I'm here today and speaking publicly about thinking about running for president because of my concern for the American people. And my love of the country.

I think we can do -- we can be doing so much better than we are. I think we look at the country today, it's very fragile, our standing in the world, and I think what's missing right now is a deep sense of leadership that the American people are longing for and deserve, a sense of character, a sense of morality, a level of civility. My business experience is not qualification to run for president, but it is what I've learned along the way. And if you look at Starbucks, what I've done in the last 36 years, unlike almost any other company in America, is we've provided comprehensive health insurance for every employee, ownership for every employee, free college tuition for every employee, and we did that because of trying to build a different kind of company of balancing profit with responsibility.

And I think that is a model for trying to do things in America that has not been done before. And that is to create the kind of spirit and the kind of confidence that the American people are looking for and leaders that they do not have today.

HARLOW: So let's talk -- it's a good question. Let's talk a little bit more about that. About if your experience to potentially be the next president of the United States is not your experience running Starbucks and building it, what is your qualification to be president?

SCHULTZ: Well I think my qualifications is my life experience. I grew up in public housing in Brooklyn, New York. In the projects. When I was seven years old, my father came home from work injured on the job, lost his health insurance, lost workman's compensation and we were destitute as a family. I lived through the shame and the understanding of what it means to be in fear of no health insurance and no money. I took that experience and it provided me a lens of how I would see the world and how I would try to build my company.

What we're really talking about today is the fact that the country has lost a sense of leadership in both parties, lost a sense of understanding about the values and the conscience of the country. And someone has to stand up and say, I'm going to be accountable. I'm going to look at the results of what we need to do, and we're going to accomplish things on the basis of what the American people need. Both parties today, on the far left and the far right, are more interested in partisan politics, revenge politics, and not doing the people's business.

The reason I'm here tonight and the reason I've stepped up is because I'm concerned about your children, my children, my grandchildren, and the future of the country. I know we can do better than this.

HARLOW: So -- so let's stay on that topic and let's talk a little bit more about your personal experience and what you lived through and what brought you here. With us now is Independent voter Greg Emetaz. He is a video designer working on a production here in Houston. What's your question?

QUESTION: Mr. Schultz, you have touted your own rags to riches story as a reason for your potential run for president. Do you think your success is all because of hard work or are there any advantages that our current system gives people like you after achieving a certain level of wealth? What would you say to the millions of hard-working Americans that are not billionaires? What do you think is holding them back?

SCHULTZ: Well thank you for the question. I mean, if anyone would have told me when I was 10 years old or 15 years old, living in public housing that I would reach this level of success, I honestly would never have believed it. Not possible.

But why was it possible? It's possible because it could only happen in America. Now, when I look at the country today and I -- and I look at a statistic that says 40 percent of the American families don't have $400 in case of a crisis, what it says to me is that the prospects of that level of success that I enjoyed is not as accessible to them as it was to me.

I find that completely unacceptable. And it's unacceptable because the government and Washington is not providing a level of humanity, responsibility, and understanding about the compassion and the empathy necessary to make sure that everyone in America has a chance at that dream.

And I'll just ask a question of all of you. Does anyone in this audience think that the United States government is doing well for you and your family or for the country and the American people? Raise your hand if you think the government is doing well for you.

HARLOW: Not a single hand.

SCHULTZ: So no one in this audience -- just think about this. No one in the entire audience thinks the government is doing well. That is why I'm here.

And I've got good news for you: We can fix it! We can fix it! But we can't fix it under a broken system where the far left and the far right are more engaged every single day and more -- and more interested in self-preservation, self-interest, and not representing you.

HARLOW: So on that point, Mr. Schultz, you say it's not your business experience at Starbucks that has qualified you for this fully. A lot of it is your personal experience, your childhood.

SCHULTZ: Yeah. HARLOW: For everyone who doesn't know, not only did you grow up in poverty, in public housing, you were abused, you were assaulted by your father. And there is a moment that you write about that was formative at 15 years old. What happened? And how did it change the trajectory of your life?

SCHULTZ: In the book that I've just released, for the first time in my life, I have revealed very personal stories that I thought were important for people to know about me and also potentially give other people perhaps the courage or the conviction to tell their story.

I grew up with a father that was in a very tough situation. He had no purpose in life. He didn't make any money. He was a World War II veteran and, unfortunately, never found his way. And he was a bitter man. And as a result of that, there were moments of rage and abuse.

It didn't define me. I didn't hate my father. But it did provide me with a level of vulnerability, insecurity, and scars that I still have today. And that's perhaps why I have such a high degree of sensitivity about so many people in America who are being left behind.

I just think it's unconscionable to live in a country where so many Americans believe that the promise of the country is no longer available to them. And so everything I've done in the last number of years is literally trying to make my parents proud. Unfortunately, they did not get a chance to see my success.

But what I want to do is restore the faith in the country and restore our values and our sense of humanity with one another. That's what I want to do.

HARLOW: So let's get to some of the key issues on the minds of the voters with us now. Let's turn to some of the issues that you would confront...

SCHULTZ: OK.

HARLOW: ... if you decide to run for president, if you become president. As you know, the president, President Trump, was here last night, a rally in El Paso, Texas, calling for money for the border wall. He thinks that's the solution to fight illegal immigration. Let's bring in Republican voter Victor Manjarrez. He served more than 20 years in U.S. Border Patrol. Victor, what's your question tonight?

QUESTION: Mr. Schultz, my question is, our country has long welcomed migrants into the United States, as long as they've entered in a manner that we have deemed acceptable. The estimated 12.5 million people residing in the United States without appropriate immigration documents has not been addressed. My experience as a Border Patrol chief patrol agent tells me it's not practical to round up everyone. What would your policy approach be to addressing this group of individuals?

SCHULTZ: I really appreciate the question, because I have spent a lot of time thinking about this, and I've actually traveled to McAllen, Texas, to see what was going on at the border. The question about immigration today, for me, is not a question about

the wall, it's not a question about ICE, it's not even a question about the Dreamers and the 11 to 12 million people who are here unauthorized. It's a question about humanity.

Now, this is a perfect example of why I'm here tonight. The vast majority of American people -- and I'm talking about 75 percent or so -- have been longing for, asking, and demanding an immigration bill that is sensible and that we pass.

The Republicans on the far right want to do everything they can, which I agree with, in terms of securing the borders. That's the right thing to do.

The Democrats want to abolish ICE, more or less. The Republicans have put people, children in cages and stripped mothers from babies. That is not humane.

The Dreamers, in my view, in terms of the humanity of the country, should be allowed a pathway to citizenship. And the 11 million to 12 million unauthorized people who are here should get in line in a fair way, pay their back taxes, pay a fee, and bring them in.

But the question of humanity is this. Everyone in this room, 95 percent of all of us here, are here because of our ancestors have come here as immigrants. We are a country of immigrants. The United States of America should not be building walls. We should be building bridges and allow people in. It is the foundation of our society.

But we also should do everything we can, at the border, to secure the borders with the best technology available, which we have in this country, and not allow bad people in.

But the politics on both side, the far right and the far left, have used this as a weapon to politicize the situation.

HARLOW: Uh-huh.

SCHULTZ: When the vast majority of all of Americans want a immigration bill that is sensible. This can be fixed, but not with a broken system where the extreme left and the extreme right will not give the people what they want. And that is, again, why I'm here tonight and believe so strongly that the system is so broken.

HARLOW: Let's get to our next question on another key issue that can be very divisive, in terms of how you tackle it, and that's climate change. We have an issue -- we have a voter here who's with us, Joel Phillips, a student at the University of Houston, a Democrat. Your question tonight?

QUESTION: Hello. So my question is, as a lifelong Houstonian, I've seen the damages that hurricanes have caused to my city, and I've watched as Harvey continued in a devastating way that damage. So in the face of a warming climate that leads to more powerful storms, how much of a priority would climate change be to your administration? And what are some plans you have to tackle that issue? SCHULTZ: Thank you for the question. I think the concern that you have I share at the highest level.

I was -- I came to -- here to Houston during Hurricane Harvey. I went to New Orleans during Katrina. And I've seen for myself what is happening in this country and around the world.

But let's maybe bring up the topic of the day, which is the Green New Deal. I read with great interest what they were suggesting. And I think these are well-intentioned people and, like me, are gravely concerned about our planet, climate change, and the things that we have to do. So the first answer to the question is, this would be a top priority. But we have to be sensible about it.

So here we are in Texas, where...

HARLOW: Uh-huh.

SCHULTZ: ... oil and gas is a primary product of -- of this entire state. But yet you lead the nation in wind energy. So it's not an either/or situation. We can do both.

But when I read the proposed bill, in terms of the Green New Deal, and I read that in -- by 2030, they're suggesting that every building in America is -- becomes clean energy, conforms to clean energy, just to put that in perspective, because it's not realistic, that would mean that between 2,000 and 3,000 buildings a day would have to be reconstructed to conform to what they're saying.

HARLOW: So let's...

SCHULTZ: And so let's be sensible about what we're suggesting. Let's not just throw stuff against a wall because it's a good slogan or we get a press release. Let's be truthful.

And if there's one thing that I'm trying to do tonight, more than anything else, is tell you what I believe, tell you what I believe is true, and speak to you from my heart for someone who is -- who loves the country, who has benefited tremendously from the promise of the country, and wants to see that continue.

But when I see politicians start throwing things out that I know is not realistic, that is not being honest with the American people.

HARLOW: Mr. Schultz, on the Green New Deal, it includes a federal jobs guarantee.

SCHULTZ: Yeah.

HARLOW: Are you supportive of that? And you mentioned Democrats throwing up slogans. A number of 2020 contenders support the Green New Deal. It's proposed by Senator Markey and Congresswoman Alexandria Ocasio-Cortez. Do you think that they are being disingenuous with the American people?

SCHULTZ: Uh, what I -- what I -- when I read the Green New Deal and I try and understand what they're suggesting, I don't understand how you're going to give a job for everybody, how you're going to give free college to everybody, how you're going to create clean energy throughout the country in every building of the land, and then tally this thing up with $32 trillion on Medicare for all. That's about $40 trillion, plus we are sitting, ladies and gentlemen, with $22 trillion of debt on the balance sheet of America.

So, once again, I -- not that I'm a business person or I'm -- or I'm an economist. And maybe an economist would disagree with me. But I think it's not -- it's immoral to suggest that we can tally up $20, $30, $40, $50 trillion of debt to solve a problem that could be solved in a different way.

It's not that they're disingenuous. I think they're well intentioned. It's -- this is not personal. I just don't agree this is the right way to approach things.

HARLOW: So let's get to another key question with us. Because you were, until, you know, a matter of months ago, a lifelong Democrat. You've contributed mostly to Democratic candidates.

SCHULTZ: Yeah.

HARLOW: But the party, you've said, has moved too far left for you, so let's go to a Democratic voter who has a question for you, Marica Mukul. Good evening.

SCHULTZ: Hi.

QUESTION: Hi, hello. So you openly opposed Alexandria Ocasio-Cortez's proposal to raise the marginal tax rate to 70 percent on incomes over $10 million. So if you're elected president, and being a member of the group of people who earn over $10 million, what would your proposed tax plan be?

SCHULTZ: Yeah. Thank you for the question. I'm going to try and explain this to you in a very personal way.

First off, I should be -- I -- I should be paying more taxes. And people who are in the bracket of making millions of dollars, or whatever the number might be, should be paying more taxes. But we have to go back a year or so.

I was very vocally against President Trump's corporate tax break of lowering the corporate tax rate from 35 percent to 21 percent. I was against it because corporations should not have been given that sweet deal without any incentive to do anything for their employees or the communities they serve. Education, training, whatever.

There was a tremendous opportunity for the United States to have comprehensive tax reform. And that would have meant higher -- higher rates on individuals like myself. Corporate tax rate of 21 percent should have never happened. And we should have examined, how can we create comprehensive tax reform so that we could lower the taxes for the middle class? But the headline is here, I should be paying more taxes and people who

make this kind of revenue and of -- of means should make -- pay more taxes. But...

HARLOW: So on -- on that point, you've just said twice, I should pay more taxes. And Marica's question, important question, was about personal income tax. How much should the wealthy pay in this country? You're a billionaire.

SCHULTZ: Yeah.

HARLOW: Give me a sense. Are you talking about, you should pay 2 percent higher, 10 percent higher, 20 percent higher federal income tax?

SCHULTZ: I don't -- I -- Poppy, I don't know what the number is. I think what I'm saying is, we need comprehensive tax reform.

HARLOW: But ballpark it for people. Because it makes a difference. Would it go up to, you know, the rate under President Clinton? Or are we talking about significantly higher?

SCHULTZ: I -- I -- what I -- I think is what being proposed at 70 percent is a punitive number. And I think there are better ways to do this.

HARLOW: So what's not punitive?

SCHULTZ: I -- I don't know what the number is, but I -- what I'm suggesting is, I should be paying higher taxes. And I think people across the country are willing to pay more -- higher taxes, but there's a caveat there. And the caveat is this...

HARLOW: But is it higher than 2 percent more, for example?

(CORRECTED COPY: CORRECTS TEXT)

SCHULTZ: I think it is.

HARLOW: OK.

SCHULTZ: But let me -- let me just -- I'd qualify this. That's very important. If you look at the American people and you asked them this following question, do you trust the government? Do you trust Congress? Most people in America say, I've lost trust and confidence in Congress and certainly in the president.

And so when you ask people to pay more taxes, we have to make sure that there is an agreement that your additional tax dollars are going to be spent wisely by the government. And that goes back to the gentleman's question about whether or not we're going to spend $20 or $30 or $40 trillion on a Green New Deal that we can't afford. There are other ways to do it.

And I -- so I think this is a very important point. We need comprehensive tax reform in the United States, where the people who are paying -- who are making more are paying -- paying more taxes, we're lowering the tax for middle-class Americans, and we're doing it in a comprehensive way.

HARLOW: So...

SCHULTZ: In addition to that, there should be infrastructure development. And one of the things I've learned this year which really surprises me is that about 20 percent, 30 percent of people who live in rural America do not have broadband access.

HARLOW: Uh-huh.

SCHULTZ: FDR more than 60 years ago made it a right for every American to have electricity. It should be a right for every American family to have broadband access.

HARLOW: So...

SCHULTZ: We're living in a digital age. We can't leave the American people behind.

HARLOW: That we are. Although I could get off Twitter, from now -- now and then, from time to time.

SCHULTZ: OK.

HARLOW: You said on "60 Minutes," Mr. Schultz, that you would release your tax returns today. Will you commit to releasing your tax returns this week?

SCHULTZ: Well, I'm -- I'm not yet decided to run for president, but if I decide to run for president, I a hundred percent will release my taxes and be completely transparent.

HARLOW: And here's why I ask, because I remember, we all remember May 2014 when now President Trump was mulling a bid for the White House and he said exactly the same thing.

SCHULTZ: Yeah, but I think President Trump, unfortunately, has a habit of not being truthful. And I think...

(LAUGHTER)

I think -- I raise my hand to all of you and I can promise you, not only will I pay my -- will I pay my taxes -- not only will I...

(LAUGHTER)

... will I release my tax...

HARLOW: Well, there you go, he'll pay his taxes.

SCHULTZ: Yeah. But I want -- I want to say something else. What is lacking right now in the country, when we -- when we can't get an immigration bill, when we've got a level of debt that we have, when we've got a failing education system, a health care system that is in crisis, and millions of Americans that no longer have access to the prospects of the American dream, all of this is about one thing, and that is, no one has stood up and said, I am going to be accountable for the results.

If I run for president, I raise my hand, and I'm say, I am accountable to solve these problems. And if we look at all of these issues that I've just gone through, and we can go through them again, the debt, the health care issue, education, all of the issues, immigration, these -- this is not new. This has been with us for years.

HARLOW: And we want...

SCHULTZ: Why?

HARLOW: We want to get to so many issues.

SCHULTZ: Yeah. Yeah.

HARLOW: We have so many great questions.

SCHULTZ: OK.

HARLOW: We're going to get to all of it in just a moment.

SCHULTZ: OK.

HARLOW: Coming up, Howard Schultz will respond to the most-asked question that we received for this town hall. Stay with us. We're back in a moment.

(COMMERCIAL BREAK)

HARLOW: All right, welcome back to CNN's town hall with former Starbucks CEO Howard Schultz. We are live to you tonight from Houston at the Hobby Center for the Performing Arts. Welcome back, everyone.

So, Mr. Schultz, the question that we received the most of, by far, ahead of this town hall was about your potential impact on the 2020 race. So on that topic, let me bring in...

SCHULTZ: Yes.

HARLOW: ... Democrat Alex Lammers from Rice University, a freshman. What's your question?

QUESTION: Hi. I'm not a fan of the two-party system. Your state -- your statements about a widening ideological gap and functional divide between Democrats and Republicans are true. But if you choose to run in 2020, you will have to convince millions of Americans that a vote for you is not a vote for Donald Trump. Why is this the time, with considerable risk of contributing to his re-election, to try something new?

SCHULTZ: Thank you, Alex. Let's go back to the question I asked earlier just to make sure we reset. I asked the audience, does anyone in the entire audience think that things are going well and the U.S. government is representing this audience and the American people well? And there wasn't one hand that goes up.

I think that is primary evidence that the majority of Americans who are not on the extreme left and the extreme right feel as if they are not being represented and that we are losing something. We all know something's not quite right. And so when I look at the situation, I have a strong belief that it's time to disrupt the two-party system that is broken, that is based on revenge politics.

And now people have asked me, how could you win? And I think this is a very important point. I know Poppy wants to get to the next question, is that in the last almost 30 years, every presidential election basically came down to 8 to 10 battleground states. But can you imagine a situation, if I run for president, we will be on the ballot of every state, and then the majority of every state, almost 50 states, a couple of them will not be in play, but let's say 45, for the first time in over 30 years, everyone's vote will matter.

So if you're a Democrat in a red state, your vote doesn't matter, because it's predetermined, and vice versa. But in a three -- three- person race, in almost 50 states, for the first time in over 30 years, American people have a voice and their vote really counts.

And I'm -- I'm here not saying I'm against the Democratic Party. I'm here saying I no longer recognize how far left they've gone. I just don't see myself in the party. And I believe that the majority of Americans feel like I do, the far right and the far left does not represent them, and they're looking for a home.

I also think millions of Republicans -- millions of Republicans who do not want to pull the lever for Donald Trump, if they have a better choice versus a far-left Democrat, will come my way.

HARLOW: So let's dig into this a little bit.

SCHULTZ: Sure.

HARLOW: Yes or no. Is there any world in which you run as a Democrat?

SCHULTZ: No.

HARLOW: OK, there you go.

SCHULTZ: I had no -- I didn't even have to think about that.

HARLOW: OK.

SCHULTZ: No. And I have nothing against the Democratic Party. Just -- I just don't feel represented.

HARLOW: So to -- to that point, you have said -- and you just repeated it -- that you promise that you will not be a spoiler...

SCHULTZ: Yes.

HARLOW: ... that you will not run...

SCHULTZ: Yeah.

HARLOW: ... that you will not continue running if it would mean a second term for President Trump.

SCHULTZ: OK.

HARLOW: If you run, Mr. Schultz...

SCHULTZ: Yes.

HARLOW: ... and if you look at the polls in the fall of 2020, and it looks like you are going to be a spoiler, like you will get President Trump re-elected, will you drop out of the race?

SCHULTZ: OK, a very important question, so let's clarify this right now, right here, on national TV, on CNN. First off, the issue of being a spoiler, how can you spoil a system that is already broken? It's just not working? So it's not -- it's not a -- it's not the right word.

Now, what I've said publicly, and I want to repeat, if the math doesn't tally up when I get to the next three or four months, and I take my message out to the American people, and I continue to talk this way about how concerned I am about the country and how much I think we can do so much better under a different process, if the numbers don't add up, I will not run for president, because I will not do anything whatsoever to re-elect Donald Trump.

HARLOW: But...

SCHULTZ: No one wants to see him fired more than me.

HARLOW: But, Mr. Schultz, the fall...

(LAUGHTER)

The fall of 2020 is what I was asking about. If you do run and the numbers don't add up your way, and it looks like it would mean a second term for the president, would you commit to dropping out?

SCHULTZ: What I've just said is, I -- I am not going to run for president if it looks in any way, shape or form...

HARLOW: But, you know, look at 2016, things change.

SCHULTZ: Yeah. Yeah, well, they do change. But at this point right now, I'm asking a different question. And that is, it's -- it's a lot less about me than giving the American people a voice that they don't have. And what better expression of our democracy than giving the American people a better choice, a new choice?

There's nothing in the Constitution, not one word, that says anything about parties. So why can't I raise my voice and say I'm deeply concerned about where we are as a country? I'm deeply concerned about our standing in the world, which we have not gotten into, and I want to restore a set of values and dignity back into the Oval Office. And I want to see the American people once again feel as if America is

a place for everyone, regardless of your station in life, the color of your skin, your sexual orientation, your gender, that everyone has an opportunity in America, and give the power of our government back to the American people. That is why I'm here.

HARLOW: Alex, you're still with us. Did Mr. Schultz answer your question?

QUESTION: Yes, I think so.

HARLOW: OK. So let's move on to the next question. Thank you for that, Alex. With us now is independent Stephen Preston, a retired U.S. Army officer. Thank you for your service to all of us. What's your question?

QUESTION: Sir, on "60 Minutes," you stated, and I'm quoting, is it in our national interest to have a fight with Mexico, Canada, the E.U., China, NATO? You asked, these are our friends, these are our allies, we're much better as a country being part of the world order.

My question is, in light of their human and labor rights record, ethnic crackdowns, unfair trade practices, and militarism in the South China Sea, are the Chinese our allies and our friends?

SCHULTZ: So when I made -- when I made that statement on "60 Minutes," I incorrectly included China in the sentence about allies. I don't believe China is our ally. But I also do not believe China is our enemy.

What I do believe is that China is a fierce competitor of the United States. I also think there are areas that are in our national interest to cooperate with China. We need China's cooperation to help solve the problem of North Korea. We also need China's cooperation specifically with lots of other nations, with regard to doing everything we can to solve the climate change issue.

What's involved right now, though, in terms of the trade and the tariff war that President Trump has started, which I think is such a strategic mistake, is three things have happened. One is that this trade and tariff war has resulted on a tax on U.S. consumers on lots of goods and services. That's one.

Second, every farmer, everyone within the agricultural industry, everyone in the steel industry has lost markets that will not come back for years.

And the third thing, and most importantly, is that we have damaged, at the highest possible level, an important diplomatic relationship with China, as China is building something very, very important that has not been discussed a great deal about, called One Belt Road, which is a super -- think about it as a super, super infrastructure development that -- and they are investing billions of dollars. That one effort -- and then them taking the long view -- is going to give them an economic advantage in the most important future region of the world, the entire Asia-Pac region. And you know where we are? We're absent. We're not there. We're not talking to them about that, we're not participating. We're not a partner in TPP. We're not doing anything. We've removed ourselves.

So what I said on "60 Minutes," which I repeat, is that this president in less than two years has fractured most relationships with not only every government, but every head of state. For what purpose? To what end?

We have always been a country that has supported our allies. We've always been a country that has built trust and confidence with the rest of the world. The world needs America's leadership. The world needs America's values. And we have removed ourselves.

If I run for president, one of the first things I would do is I would visit every world leader that this president has damaged in terms of our relationship and restore the trust and confidence in America, because we need them to go forward to establish America's leadership, economically and in the world order today.

HARLOW: So let's -- let's talk about China a little bit more, if we could here, because you've been many, many times.

SCHULTZ: Yes.

HARLOW: And I believe Starbucks is opening a new store in China every 15 hours. You own personally more than 33 million shares in Starbucks stock, which closed at a record high yesterday. That's over $2 billion worth. And you've said that the exposure of Starbucks in China will be greater than in the United States, pretty soon.

SCHULTZ: Yes.

HARLOW: If you become president, how is Starbucks' considerable reliance on China not a conflict of interest for you?

SCHULTZ: A very important question. First off, in the last 20 years, Starbucks has built almost 4,000 stores in China and done it in a very successful way, by partnering with the Chinese government, by demonstrating to them American values.

As an example, not only have we given health care to our employees in the U.S., we actually gave critical health care to the parents of our employees in China. The first company, not only Chinese company, first company ever to do anything like that, demonstrating America's values and the humanity of our company.

What I've said publicly is that if I run for president, there will be no conflict of interest of anything that has to do with Starbucks, and certainly with regard to China.

HARLOW: So...

SCHULTZ: I'm running -- if I run for president, I'm running not as an independent, I'm running as an American, wrapping myself in the American flag. My first order of business is to put the American people first in everything I do, and there will be no conflict of interest in anything I have to do legally to separate myself from my financial interests with regard to China will be completely done. I am not Donald Trump.

(LAUGHTER)

HARLOW: To follow up on that.

SCHULTZ: Yes.

HARLOW: April Henshaw, a Democratic voter, has a question for us.

QUESTION: Hi. I, basically -- it's a little history lesson on Jimmy Carter. He set a great example by disclosing and surrendering his investments and business interests that might influence his legislative priorities, like his beloved peanut farm.

SCHULTZ: Yeah.

QUESTION: Trump has changed this precedent. Would you follow Carter or Trump's lead?

SCHULTZ: I think that's the easiest question of the night.

(LAUGHTER)

That is a question I don't even have to think about it. The only thing that I would follow Donald Trump to do is when he made the statement, before the government shutdown, that the buck stops with him. You remember he said that? And then, two or three weeks later, he said, this is not my responsibility.

The answer to the question is, President Carter had a great deal of integrity, a set of values. I would do everything I could to follow his lead with regard to transparency.

HARLOW: If you run for president, if you become president, Mr. Schultz, will you sell all of your shares in Starbucks?

SCHULTZ: Well, I think we're getting way premature.

(LAUGHTER)

This is my -- this is my third week since "60 Minutes."

HARLOW: I think people laugh, but you're seriously considering it.

SCHULTZ: Yes. Yeah.

HARLOW: You have a huge stake, over $2 billion, in Starbucks. The biggest market for Starbucks will soon be China.

SCHULTZ: Yeah.

HARLOW: And we have seen what has happened in this presidency.

(CORRECTED COPY: CORRECTS FORMAT)

SCHULTZ: Yeah. Uh, I think the best way to say that is that I will do nothing whatsoever to have any conflict of interest between my investments overall or my interest in the company that I love, because I will put the role and responsibility and the accountability for results first, if I run for president and I'm fortunate enough to win. And that is a promise I make to the American people.

HARLOW: Have you not decided if you would sell all of your shares?

(LAUGHTER)

SCHULTZ: I don't think that's the question. I think there's multiple ways to do this. No, no, I'm not -- I'm not evading the question. Let's -- there's multiple ways to do this, to set up a blind trust, to do lots of things to remove any conflict of interest.

HARLOW: Let's get...

SCHULTZ: Go ahead.

HARLOW: Let's get to our next question. It's an important one. It comes from a veteran, Nicole Baldwin. She's a U.S. Army combat veteran who served in Iraq and Afghanistan.

SCHULTZ: Wow.

HARLOW: Thank you for that.

QUESTION: No problem. Hi. As a veteran, I have been very disappointed and displeased by both the professionalism and services of the V.A. health care system. We have many outdated hospitals run by non-veteran medical and mental health providers. What are your solutions for modernizing the health care -- the V.A. health care system and giving veterans the opportunity to receive advanced medical and mental health care in state-of-the-art facilities that our veterans most desperately need and deserve?

SCHULTZ: Thank you. With great humility, thank you for all you've done for the country, for you and your family's sacrifice and commitment to the United States of America. Thank you.

QUESTION: No problem.

SCHULTZ: I have spent a great deal of time over the last few years engaged in learning as much as possible about the military, their role in the world, and the responsibility that the V.A. has.

Just as a side note, Starbucks Coffee Company has hired almost 20,000 veterans and/or spouses. We have built 50 Starbucks stores adjacent to military bases. And my wife and I have created an opportunity for 18 transitional training services on military bases.

Just quick story. We were in a meeting and someone who was transitioning out said something I will never forget. And he said, I have more anxiety about going on a job interview than I do going back to Afghanistan. And when I heard that, I knew that we had to do something to solve this problem.

So over 1 million extraordinary young men and women like yourself who have worn the cloth of the nation, have come home, and have had a tough time with transition, specifically the V.A. -- I'm going to give you a number you're not going to believe. Does anyone in the audience know what the annual budget is for the V.A.? You will be shocked. The annual budget for the V.A. is $200 billion. Two hundred billion dollars!

And I asked you a question earlier about the United States government and the left and the right. Is there any more evidence that we need, as a country, that we are not -- the solemn promise to take care of our veterans, when they take off the cloth of the nation, and we have a $200 billion agency that is not serving the men and women properly?

Now, there are good people in the V.A., but there is a level of bureaucracy that is just unbelievable, and now we want to turn over the entire health care industry to the U.S. government? I mean, let's be real about certain things.

The U.S. government does some great things...

HARLOW: Yeah, and we're going to...

SCHULTZ: But the V.A. isn't one of them. And let me just say. If I -- if I run for president, and I'm fortunate enough to be elected president, I raise my hand right now, and I tell you all, I am a businessperson that is results-oriented. I've run a public company for 26 years. I raise my hand and I say, I will fix the V.A. and I will be personally accountable if I run for president and I'm fortunate enough to win. No one in decades has fixed the V.A. with an annual budget of $200 billion. It is criminal.

HARLOW: Mr. Schultz, you have diagnosed a problem. It's a problem we all know exists, and it's a tragedy and a travesty. What would you do to fix it?

SCHULTZ: OK, what -- what I would do to fix it, first off, is diagnose the problem. And diagnosing the problem is that we have layers and layers and layers of government bureaucracy. No one knows who's in charge. There's no transparency of records. Veterans are waiting weeks and months for prescription drugs. There's all kinds of problems.

You have to put the quality people in charge with accountability to the president. The president of the United States is not concerned about the V.A. That is not what he's worried about. He talks a great deal about his support of veterans, but doesn't do much other than when the cameras are on.

I will fix the V.A., because it's about leadership, it's about character, and it's also about the temperament of humility to listen to people who are smarter than you, who have more experience than you, to help solve this problem.

So it's really about leadership. It's about character. And it's about results and accountability. I will be accountable. And I -- if I run for president, I promise you, I will fix the V.A.

HARLOW: Nicole, thank you for question. Thank you for your service. We have many more important questions straight ahead. We will be right back with more from CNN's live town hall here in Houston with Howard Schultz. Stay with us.

(COMMERCIAL BREAK)

HARLOW: Welcome back to CNN's town hall with former Starbucks CEO Howard Schultz.

And I'd like to take a moment to talk about something in your career leaving Starbucks that you call a blow to our soul, and that is the racial profiling and the arrest of two black men recently at a Philadelphia Starbucks. So on that point, Democratic voter Orgena Keener owns the Caffeine Coffee Cafe here in Houston. And you have a question on this issue?

QUESTION: Yes, hello, how are you?

SCHULTZ: Thank you.

QUESTION: Last year, an acute situation developed at a Starbucks store in Pennsylvania. Our nation was divided, and thoughts of racial profiling soared. And unconscious bias training session was implemented, and many moved on. Do you believe the training was effective? And do you anticipate the voters taking their thoughts about this incident to the polls?

SCHULTZ: I thank you so much for this question, because I think of all the things we can talk about tonight, injustice in America of any kind, especially racial injustice which continues, is not something that we should be proud of and we need to resolve.

The situation in Philadelphia that occurred -- I don't know how many people know the exact story, and I'll try and be brief. Two African- American gentlemen walked into the store, they asked to use the bathroom, they were asked to buy something, they didn't. Something happened verbally between them and the manager. The manager decided to call 911. The men were arrested, handcuffed. Thank god they didn't resist and they were put in jail. And it created a tremendous problem for the company.

We immediately went to Philadelphia, we met with the two gentlemen, we met with clergy, we met with the D.A., but most importantly we realized that we had a problem. And it's a problem that I think exists widely in this country. And it's something that I would characterize as unconscious bias that many of us have based on our own life experience.

And as a result of that, we decided that we should close every store at Starbucks, at great expense, not for a PR stunt, not for marketing, but to train 180,000 people, and then we got experts who could help us do it, Sherrilyn Ifill of the NAACP, Bryan Stevenson, Common, Mellody Hobson, a whole host of people who could help us with the curriculum. It was four hours of training, which is not something that's going to

change people's view. And now we're -- and we're training everyone that comes into Starbucks, because we hire almost 50,000 new people a year.

The training is ongoing. The training is deeply a courageous act, because we're doing something that we've realized we fell short on, and we're admitting the fact that we have to get better at this. And I think this is in many ways a proxy for the country. We have to be able to have uncomfortable conversations. We have to talk to people who are different than ourselves. We have to embrace the diversity of the nation.

Starbucks is a diverse organization, and we want to do everything we can. It was a terrible moment for the company. It's not something that we're going to forget. And it's something that we learned a great deal from and we're still learning about.

And I would just say, as somebody who grew up in a very diverse background as a young boy in the projects, I didn't color as a young boy, and I honestly don't see color now. And I want to do everything I can in terms of the character and the dignity of what it means to be the president of the United States, is if I should run and be elected, that the Oval Office represents so much about the character of the nation, the morality of the nation.

And we all know that we've seen things in the last two years that embarrass us, not only at home but around the world, and we need to do everything to restore the humanity of the country. And the president of the United States has a large role to play in that because he sets the agenda on the morality of the nation.

HARLOW: Orgena, thank you very much for that important question. All right, so let's move on to health care. Let me bring in Republican Brielle Corvetti. She's a medical student at Baylor College of Medicine. What's your question tonight?

QUESTION: Hello. So, I'm wondering, what is your view on Medicare for all? More specifically, what is your plan to improve our health care system?

SCHULTZ: Again, thank you for the question. And I think this gives me another opportunity to talk about the extreme left and the extreme right.

And so we have a health care crisis in the country on many levels, not the least of which is the opioid crisis. But the Republicans, for 10 years, 8 years during Obama presidency and the last 2 years, have done everything possible to eradicate the Affordable Care Act. And they've done that without offering any plan -- this is the far right.

The far left is now suggesting Medicare for all. That is a $32 trillion number. And the -- and just like the issue I brought up before about making all the buildings in America energy-free, in terms of -- of clean energy, does anyone here really understand that Medicare for all also means that you will lose the choice of your doctor and your private insurance company? Not many people know that. So that would disrupt the entire system, and it'll cost $32 trillion.

HARLOW: So, Mr. Schultz, to that -- to that question, and because your question, Brielle, was about what's your plan, and many I think wonder is it fair to criticize the left and the right. What is your plan to make sure that every -- if it's not Medicare for all, what is your plan to make sure that every American can get quality, affordable health care?

SCHULTZ: OK, first and foremost, three principles. One, I think everyone in America, every person deserves to have the right for affordable care. Every person.

Second, there needs to be competition in the system. And what I mean by that is, competition so that the American people can get access to prescription drugs at lower prices, because right now the government is not allowed under a federal law to negotiate with pharma.

The third thing is that it has been tested, but not proven yet about interstate commerce among insurance companies. But there's no doubt that once again the health care crisis has been with us for a long time.

The other issue is, I stand by the fact that I supported the Affordable Care Act. It covered 20 million people who did not have good insurance, but premiums have gone up double since the Affordable Care Act. So now we got to go back in and fix the Affordable Care Act and bring premiums down. Competition will do that. But the far right, remove...

HARLOW: How? The question is how?

SCHULTZ: Yeah.

HARLOW: I don't mean to startle you from the back.

SCHULTZ: No, no.

HARLOW: The voice over your shoulder over here. But how specifically? Because I think so many people here hear that, but they say that is what Congress has been trying to do or talking about doing...

SCHULTZ: No, it's not. It's not. You're wrong.

HARLOW: ... for so long.

(CORRECTED COPY: CORRECTS FORMAT)

SCHULTZ: Respectfully, it's not what Congress had been trying to do. What Congress has tried to do is, on the far right, eradicate the Affordable Care Act and now, on the far left, bring up Medicare for all, while prices have gone up. I mean, people are paying $300 for a vial for insulin that 10 years ago cost like less than $100, and the cost of it hasn't gone up. So this -- you're going to -- you're going to chastise...

HARLOW: But lowering the price of prescription drugs doesn't solve the whole problem.

SCHULTZ: It doesn't solve the whole problem, but do we understand the fact that the prescription drugs -- again, I don't know how many people understand this. Prescription drugs in America are priced at a -- that's price X, because we cannot negotiate with the drug companies.

Those same drugs that are manufactured here are available in other countries at a lower price because the drug companies and the -- and the insurance companies are spending $400 million to $500 million a year in lobbying efforts in which both parties are complicit to maintain the status quo.

HARLOW: We have many more issues to talk about. I just want to get to those voters' questions on these issues. So we're going to take a quick break. We will be right back, live from Houston. CNN's town hall with Howard Schultz continues. Stay with us.

(COMMERCIAL BREAK)

HARLOW: All right. Welcome back to CNN's live town hall with former Starbucks CEO Howard Schultz, back to our audience questions. Let me bring in Republican voter Kevin McMachen, a realtor here in Houston. Hi.

QUESTION: Mr. Schultz, you've expressed that you're in favor of taking guns of war out of American people's neighborhoods. Assuming that you're referring to assault-style weapons, can you explain your motivation with this initiative, considering that less than 4 percent of firearm murders, according to FBI statistics, are caused by rifles and other similar weapons? And how is removing assault-style weapons going to benefit the greater good of the country?

SCHULTZ: I thank you for the question. I know this is a very sensitive issue around the country, and certainly in Texas.

I said earlier I want to talk about what I believe in, what's in my heart, and what's true for me. So, first and foremost, I respect and I honor the Second Amendment. And I would do nothing if I was president to in any way approach that in a way that would be dilutive to that amendment, the right to bear arms. I understand it, I respect it.

When I read a story about teenagers in America across the country, who -- in which their number-one fear every single day, going to school, is that there's going to be a school shooting, it breaks my heart. We've had a lot of violence in America. And it's linked to lots of issues, mental health issues, as well as what I characterized as weapons of war.

I think we can agree to disagree on this issue. But what I believe is that there should be some sensible approach to removing the kind of weapons that have no place in common society and pose a threat to those teenagers who every day are in fear of a shooting.

Now, I'm not taking an isolated situation and bringing it all to one issue. But I think we could have more balance and more sensibility around this issue while respecting and honoring the Second Amendment.

I have a hard time understanding why people need to carry an AR-15 around in the streets of where they live. It's hard for me to understand that. I respect without question the issue of sportsmen, of hunting, and all the things that go with gun ownership. But I think anyone who has a criminal record, anyone who has a mental health problem, that there needs to be a lot more jurisdiction on how those people are buying those weapons. And I think we should take a look at this.

Now, the far right, once again, doesn't want to do anything on this issue. And the far left wants to do everything possible to remove guns completely. I am in the middle. I am a centrist. And I think there's a sensible approach to this.

Also, going back to immigration, going back to health care, the majority of Americans want to see a sensible solution to this issue. And those are the people that I'm listening to, and I believe that that is the right approach.

HARLOW: Thank you for your question. And let's get to our next question in the audience. This comes from independent Barik Chaudry. What's your question tonight?

QUESTION: Mr. Schultz, you are known for pioneering Starbucks' partnership with Arizona State, which allows Starbucks employees working more than 20 hours a week to qualify for free tuition through ASU's online courses.

As a student, my question is, how would you make higher education more affordable at a time when most graduates -- most graduates leave college with considerable debt and the cost of tuition is growing much faster than we can keep up with?

SCHULTZ: I am so proud of the fact that Starbucks was the first company in America to offer free college tuition to every employee in a partnership with ASU.

Now, your question is so critically important to the situation right now. And once again, this is a problem that should be able to be solved. We have over a trillion dollars of debt on the backs of students. But the issue at hand is that there hasn't been any accountability on the part of universities and colleges for completion.

And what I would say is that if a college is not completing -- if students are not graduating from their college, those colleges should not get federal aid from the government. And we should look at ways for bringing those kids back into college and figuring out a way to delay the payments so the burden of responsibility is still there, but they can live a life in which they're not burdened every day by the trillion dollar-plus, which is greater than credit card debt, on the backs of students today.

But we have to be a country that invests in education at K-12, through innovation and through practices that are not in place today. And we have to do everything possible to hold universities and colleges accountable for graduation, which they are not today.

HARLOW: Well, what about building on what you did with Starbucks?

SCHULTZ: Yeah.

HARLOW: With ASU. My question to you is, do you believe that there is an onus on American corporations to help fund higher education for their employees? Is there a moral responsibility? And also, is that the future of higher education in this country, to have more go online and more be funded by corporations?

SCHULTZ: Yeah.

HARLOW: Do you think that's...

SCHULTZ: Well, I think -- I've said for the last couple of years that I think the moral obligation for corporations in America is the rules of engagement have changed and we need to do more for our employees and for our communities. And providing -- there's no reason why the program at Starbucks shouldn't -- can't scale to other companies, because it's a unique partnership between Starbucks, ASU, and the United States government through Pell Grants. It's a scalable program. So, yes, the short answer...

HARLOW: Even for companies without the margins that Starbucks enjoys?

SCHULTZ: Yes, it's possible. Yes.

HARLOW: OK. Our next question comes from Madeline. She is an independent, Madeline Monroe, a PhD candidate -- bravo to you -- at Rice University. What's your question?

QUESTION: Hi, Mr. Schultz. If you were to select a single factor that most aptly reflects the overall success of the country, what would it be? A thriving economy? A healthy population? Or something else?

SCHULTZ: I would say it's access to opportunity, is that we're living in a very fragile time right now, where so many American families feel as if they have lost confidence and trust in the promise of the country.

And I know in my heart that we are better than this right now, that this is a moment in time that we can fix, that we cannot allow American families across the country to feel as if the American dream is not accessible to them.

So I think it's opportunity as well as what I said earlier, and that is returning the power of the government back to the people, for the people, of the people. This is something so critically important. The government is not representing the people as the way we should be represented. And I think it's -- the issue here is opportunity and access for everyone.

HARLOW: Let's go to our next question. Paul Belin joins us. He is a Democrat who works in the energy industry. What's your question tonight? QUESTION: Mr. Schultz, if you were to be elected, what would be the

very first thing you did on day one of your term and why?

SCHULTZ: Well, first off, again, I'm three weeks in.

(LAUGHTER)

But I think -- I'm so concerned about our standing in the world and how President Trump has fractured our relationships with our allies that one of the first things I would do is I would be on the phone with every world leader that no longer feels that the America -- that America is standing with them and make sure they understand that they can trust the person in the Oval Office and have confidence that we will stand by them.

And, you know, this speaks to something that the -- that the president did in the last couple of months, with regard to Syria. Do I have time for that or not?

HARLOW: Please.

SCHULTZ: OK, I mean, I disagree completely with how President Trump acted in unilaterally deciding that we were going to pull out of Syria for a whole host of reasons. The first is, he did not inform any of our allies. The second is, the president of the United States has a moral responsibility to listen to the intelligence community and his military advisers. He did not do that.

And not only did he not do that, but he completely obliterated the respect of those people and left Syria. In leaving Syria, announcing that he's leaving Syria, the result is we now have Russia moving in to Syria with Iran. And Russia now has a stranglehold on the Middle East that is going to affect that region for many years to come.

We had a moral obligation to stay in Syria, to make sure ISIS does not get stronger, to protect the Kurds, who are fighting right next to us, and all of that was gone because President Trump woke up one day and decided we were leaving Syria.

The country cannot function by these kinds of hyperbolic decisions. We need a thoughtful, disciplined strategy in all the things we're doing, and it goes back to thoughtful, servant leadership and recognizing the role and responsibility of the commander-in-chief. And one of the roles and responsibility of the commander-in-chief is restraint, is demonstrating the humility of restraint.

HARLOW: Howard Schultz, thank you.

SCHULTZ: Yeah.

HARLOW: Thank all of you very much for being with us tonight. Thank you, as well, to the Hobby Center for the Performing Arts and our audience here in Texas for their very thoughtful questions. Be sure to tune in on Monday for a Democratic presidential town hall with Minnesota Senator Amy Klobuchar, hosted by my friend, Don Lemon. 33333