A Not-So-Hot Feeling Grips the Once Cool Northwest

Maybe the Pacific Northwest, the erstwhile cool capital of the Western Hemisphere, is not going to conquer the world after all. Every day brings another blow to the regional psyche. Long before the tragic school shootings in Oregon on Thursday, once-buoyant reputations were sinking faster than crab pots.

Early last week, software giant Microsoft Corp. was sued by the U.S. Department of Justice and 20 states for alleged violations of antitrust laws. Although this is by far the most visible example, the company is not the sole Northwest icon under attack.

Nike Inc., the Oregon shoe giant, is accused of enslaving workers among the indigenous peoples of the Third World in Dickensian sweatshops.

Starbucks Coffee Co. is said to be a despoiler of tropical ecosystems with its shade-free coffee trees, not to mention cooperating with all sorts of vile dictatorships.

The clothier Nordstrom’s vaunted customer service ethic ran afoul of wage and hour laws when employees complained of being forced to work too long and too hard.

Eddie Bauer, the specialty outdoor-wear retailer, now belongs to a mass market catalog company.

Courtney Love, a specialty item if ever there was one, went from her ratty but hip band Hole to Versace fashion spreads.

Even venerable Boeing Co. fell--both on its balance sheets with billions in losses and literally, with tragic, inexplicable in-flight accidents--casting doubt on its reputation as a place of stolid engineering excellence.

It seems eons have passed, but just two years ago, Business Ethics magazine ranked Microsoft one of the 10 most socially responsible companies in America. Now, Microsoft Chairman Bill Gates is called a robber baron. His wire-rimmed comrades at Microsoft have been transformed from the entrepreneurial slayers of Big Blue into minions of the Evil Empire. Their suburban Seattle campus has the highest influx of Justice Department lawyers outside of independent counsel Kenneth W. Starr’s office. A writer for Microsoft’s online magazine, Slate, complains that strangers these days treat company employees “like we work for Philip Morris.”

When a Times story last month revealed that Microsoft was planning a public relations campaign that included a manufactured show of grass-roots support, company spokesmen responded in part by saying that everybody does things like this.

To which some observers said: Microsoft was not supposed to be like everybody else.

David Brewster, former editor of a Seattle alternative weekly, said Microsoft promises as much itself. Part of the mantra is that they do things differently.

“They lead. They reinvent,” Brewster says. “They have in fact reinvented American business management. So why should they do this other thing like everybody else?”

As one ethics professor told a Seattle newspaper, “They were supposed to be good guys.”

What happened? How did the good guys become the bad guys? Or were they really bad guys in disguise all along?

The Northwest not that long ago was regarded with something approaching awe by outlanders. The place was so hip that the biggest concern locals had was being overrun from back East, a geographic category that stretched to include almost everywhere else.

The cachet of cool attached itself not just to the place but to the things that emerged from here as well, most notably lifestyle exports the region became identified with: coffee, microbrewed beer, sports gear, music, software and clothing.

How things change. Just as it seemed that the trendsetters could do no wrong, suddenly they could do no right.

Some folks here are scratching their head wondering whether the avalanche of troubles says anything about the mountain it fell from. These companies were products of the region. So, was all the praise of the region just so much hype as well? Does the Northwest have unique characteristics, or is it just another place on a map?

Actually, a map is a good place to start. The Northwest is hemmed in--cut off by water on one side, mountains, deserts and thousands of miles on the other. California is too. But California is so immense that its metropolitan centers cannot be ignored. It is commercially and psychologically connected to the rest of the country. Seattle and Portland, on the other hand, until recently, were very small cities with moribund economies.

Maria Eitel, vice president of corporate responsibility at Nike and formerly a Microsoft executive, is among those who think the Northwest’s geographical isolation lent unique characteristics to its home-grown businesses.

“There is something about the physical distance from Washington, New York and even L.A.,” she says. “People like Bill Gates and [Nike CEO] Phil Knight were not, at any point in building their companies, spending time with the government leaders of the country.”

“It’s a long way from anywhere. That remoteness contributed to the slow economic growth,” says Ted Leonhardt, owner of a Seattle marketing and design company. “We were a one-company [Boeing] town up until just a few years ago.”

The isolation functioned as insulation as well, allowing a different social ethic to evolve: the culture of nice. This combined with the physical endowments--snow-capped mountains, fir forests and cool, clear water everywhere--to attract a certain sort of person. A University of Washington academic recruiter once said he had a fail-proof test for job candidates: He looked at their shoes. If they wore tasseled loafers, forget it. “If they came to the job interview in hiking boots, I knew I had them.”

Terry Heckler, a Seattle advertising executive who has worked for Starbucks, says: “I always felt people were here to some degree to get away from everything else, to get into the wilderness. . . . And the ultimate effect of that was, they were less stressful businesspeople.”

Businesses here incorporate this laid-back attitude. They seem to breed a new kind of user-friendly capitalist, more interested in sharing products with you than getting rich.

Gordon Bowker, a founder of Starbucks and Redhook Brewery, says many Northwest giants started naively. Nobody had business plans or global market strategies.

“The companies I was involved with starting, my intent was never to make a lot of money. We just wanted some good coffee,” he says. “The people who did it I don’t think even understood what they were doing. That was almost preoriginal sin. There was a sort of basic idea of quality that preceded the idea of quality as a marketing concept. Now it’s just another way to make money. Something to sell.”

Sen. Slade Gorton (R-Wash.) says he went to the Microsoft campus recently on a sort of diplomatic mission, to give the company some advice on how to handle “the other Washington.”

When he started talking to executives, he found a startling lack of awareness and sophistication with the ways of the world. He says he initially felt like he was teaching Poly Sci 101 to a bunch of college guys in lumberjack shirts. Upon reconsideration, even that seemed too sophisticated. “It was more like high school,” he says.

Gorton says Microsoft’s regional isolation is abetted by a skewed age pyramid. The company grew with an almost total absence of older mentors. It’s as if the lumberjacks lacked adult supervision.

In many ways, what the Northwest’s powerhouses sell are less products than ideas. They’re brands. Marketing practitioners say successful brands are collections of associations. You buy not so much the thing on the shelf as the images it evokes.

Part of what many Northwest companies have sold is the Northwest itself: its casualness, humble craftsmanship, the outdoors--a green glow, one Starbucks executive calls it.

David Harrison, a University of Washington researcher who has studied the growth of the Northwest economy extensively, says of Starbucks: “Do you think they would have been anywhere near as successful if they came from Newark?”

These companies also sell a commitment to what they do. At Nike, some employees tattoo swoosh logos on themselves and talk about drinking the Kool-Aid, by which they mean undergoing what amounts to a conversion experience.

Eitel says Nike and Microsoft share a sense of passion that derives directly from their founders, Gates and Knight.

When true believers are attacked, she suggests, they are shell-shocked and misperceive the nature of the attack. They think that if they can just explain themselves better, everybody will understand, and like them again.

“In defense then, they tend to go back and try to explain; they tend to go back to really granular detail. Well, that’s reacting on the wrong level,” Eitel says. “The critic is out there saying: ‘He doesn’t get it. I’m talking about the whole nature of his business and he’s defending some little detail.’ Instead of making it better, they can make it worse.”

The passion accounts for some of the public relations problems the companies are now experiencing.

“When something starts to grow, it attracts interest and money,” says Bowker, the Starbucks founder. “And what’s the old Bob Dylan line--’Money doesn’t talk, it screams.’ The expectations become mutated. The DNA is still carrying the ‘aw shucks’ gene, but the money is screaming. A dissonance is created.”

This dissonance can make consumers feel betrayed. Some of these companies have succeeded too well, becoming global juggernauts. Now they’re the establishment. It’s hard to be hip when your wealth is measured as a percentage of the gross domestic product. The pop exuberance of Nike’s image is dimmed considerably by the pall of its omnipresence; you end up with a class of New Jersey schoolchildren writing and performing anti-Nike plays.

If you sell yourself as something special, you have a problem when you act like everybody else, says John Eastham, a Seattle marketing executive. One element of a brand is trust, he says, a sort of contract with the customer. And “when an organization has a high level of trust and you start going against it in however small a way, it’s trouble.”

If enough of this happens, it adds up, Brewster, the editor, says. “You see the region losing its virginity. There was a claim to distinction there, but with some slight exceptions, it’s gone.”

It must be said that not everybody here is expressing these worries. They’re not concerned about the Northwest’s demise, mainly because they don’t see it happening.

A more common local explanation is to blame the media hype. A lot of people think the praise the place received over the last decade was so extravagant that there was bound to be a revisionist movement--and now it has arrived in full force. The Northwest was the flavor of the month, they say. The month has ended.