(NYTIMES) “Woke capitalism” has been a steadily growing phenomenon over the past decade. The muscle of the movement was evident as early as 2015 in Indiana and 2016 in North Carolina, when corporate opposition forced Republicans to back off from anti-gay and anti-transgender legislation.
Much to the dismay of the right – a recent Fox News headline read “Corporations fear woke left minority more than silent majority” – the movement has been gaining momentum, obscuring classic partisan allegiances in corporate America.
This drive has a fast-growing list of backers from the ranks of the Fortune 500, prepared to challenge Republican legislators across the United States.
Right now, the focus of chief executives who are attempting to burnish their progressive credentials is on blocking laws in 24 states that curtail access to the ballot box for racial and ethnic minorities – laws that, among other things, reduce the number of days for advance voting, that require photo IDs to accompany absentee ballots and that limit or eliminate ballot drop boxes.
Perhaps most threatening to Republicans, key corporate strategists attempting to woo liberal consumers have come to believe that their support for progressive initiatives will generate sufficient revenue to counter retaliation by hostile white voters and the Republican politicians who represent them.
The corporate embrace of these strategies has generally received favourable press, but there are some doubters.
The Atlantic’s staff writer Adam Serwer argued in “Woke capital doesn’t exist” on April 6 that capital “pursues its financial interests in whatever political or social context it finds itself”.
As Mr Serwer puts it: “For big firms, talk is very cheap. Similarly, the actions of Major League Baseball, Coca-Cola, and Delta reflect the political landscape in Georgia and its interaction with their bottom line, not the result of a deep ideological commitment to racial equality.”
Similarly, Mr Matthew Walther argued in an August 2017 article in The Week magazine that “we should not be looking to corporate America for moral instruction or making exemplars of its leaders or heaping approbation upon their bland, cynical consultant-designed utterances”.
Apple’s chief executive Tim Cook, Mr Walther continued, “tells us that he is against racism. I believe it. Good on him”. As commendable as Mr Cook may be for his anti-racism, Mr Walther wrote, he is the CEO of a corporation that has made profits on a scale hitherto unimaginable in human history by exploiting cheap labour in a poor country ruled by tyrants whose authority is perpetuated in no small part thanks to Apple’s own compliance in its silencing of dissent and hiring the smartest lawyers in the world to make the company’s tax burden negligible.
Companies leading the charge against laws promoted by Republican state legislators include American Airlines, Delta Air Lines, Coca-Cola, Merck, Dell Technologies, Nestle USA, Mars and Unilever.
And this week, 30 chief executives of Michigan’s largest companies, including Ford, General Motors and Quicken Loans, declared their opposition to similar changes in voting rules pending before the legislature.
The headline on an April 10 Wall Street Journal story sums up the situation: “With Georgia voting law, the business of business becomes politics”.
Last week, executives from over 100 companies held a video conference call to explore ways to voice their opposition to pending and enacted election legislation.
For many Republicans, the future of their party’s dominance in such states as Texas, Florida, North Carolina and Georgia rides on their ability to hold back the rising tide of minority voters.
While Republicans are convinced of the effectiveness of their legislative strategies, poll data from last year’s election suggests they may be mistaken. Republicans made inroads last year among black and Hispanic voters, the constituencies they would now suppress, while losing ground among white voters, their traditional base of support.
Growing numbers of Republicans are refusing to buckle under pressure from the corporate establishment.
For Governor Brian Kemp of Georgia, who rejected Mr Donald Trump’s pleas to overturn the state’s presidential election results, the controversy offers the opportunity to claim populist credentials and perhaps to win back the support of Trump loyalists. “I will not be backing down from this fight,” he declared at an April 3 news conference.
In Texas, where American Airlines, Dell Technologies, Microsoft and Southwest Airlines have opposed laws under consideration by Republican state legislators, Republicans have been quick to go on the attack.
“Texans are fed up with corporations that don’t share our values trying to dictate public policy,” Lieutenant-Governor Dan Patrick, a Republican, declared in a news release attacking liberalised voting protocols.
Other Republicans are explicitly warning business that it will pay a price if it goes too far. “Corporations will invite serious consequences if they become a vehicle for far-left mobs to hijack our country from outside the constitutional order,” Mr Mitch McConnell, the Senate Minority Leader, declared at an April 5 news conference. “Our private sector must stop taking cues from the Outrage-Industrial Complex.”
In the past, the corporate community had been one of Mr McConnell’s most steadfast allies and its current adversarial stance is a major loss.
Professor Alma Cohen of Harvard Law School and three of her colleagues analysed campaign contributions made by 3,800 individuals who served as chief executive officer of large companies from 2000 to 2017 in their 2019 paper, The Politics Of CEOs. They found a decisive Republican tilt: “More than 57 per cent of CEOs are Republicans, 19 per cent are Democrats and the rest are neutral.”
I asked University of Virginia’s sociology professor W. Bradford Wilcox, a conservative, for his assessment of the conflict between big business and Republicans. His reply suggested that Mr Kemp’s defiant stance will resonate among Republicans.
The decades-long marriage between the Grand Old Party (GOP) and big business is clearly on the rocks. This is especially true because the GOP is increasingly drawn to a pugnacious and populist cultural style that has more appeal to the working class, while big business is increasingly inclined to support the progressive cultural agenda popular among the highly educated.
Taking on corporate America meshes with the goal of rebranding the Republican Party – from the party of Wall Street to the party of the working class.
The response of the white working class to the leftward shift on social issues by American businesses remains unpredictable.
Democracy Corps, a liberal group, conducted focus groups of white Republicans last month and reached the conclusion that conservative voters are cross-pressured: The Trump loyalists and Trump-aligned were angry, but also despondent, feeling powerless and uncertain they will become more involved in politics.
While anger is a powerful motivator of political engagement, despondency and the feeling of powerlessness often depress turnout and foster the belief that political participation is futile.
How will this play out?
The US will continue to see ugly political battles long into the future, but the culture wars are tilting definitively towards a progressive win and not least because they have a new patron in important corporations.
Ms Malia Lazu, a lecturer at the Massachusetts Institute of Technology’s Sloan School of Management, has argued in an e-mail that the public’s slow but steady shift to the left on racial and social issues is driving corporate decision-making: “Corporations understand consumers want to see their commitment to environmental and social issues.”
She cited studies by Cone, a business consulting firm, “showing that 86 per cent of Americans would support a brand aligned with their values and 75 percent would refuse to buy a product they saw as contrary to their beliefs.”
Ms Lazu contends that “there is a generational shift in America towards increasing justice and collective responsibility” and that as a result, “institutions, including corporations, will make incremental change”.
Professor of public policy Joseph Aldy from Harvard University’s Kennedy School noted in an e-mail that willingness to engage in controversial political issues is most evident in the case of climate change: The climate denial/climate sceptic attitude that characterises many Republican elected officials is increasingly out of step with the majority of the American public and the American business community, he said.
There are several possible scenarios of how these preoccupations and conflicts will evolve.
Insofar as the split between American business and the Republican Party widens and companies begin to cut their campaign contributions, the likely loser is Mr McConnell, the leader of the party’s corporate wing. Any limit on Mr McConnell’s ability to channel business money to campaigns would be a setback.
Such a development would further empower the more extreme members of the Republican Party’s Trump wing and would embolden Republican officials to escalate their conflict with corporate America.
For example, Mr David Ralston, the Speaker of the Georgia House – which has just passed a retaliatory Bill penalising Delta by eliminating a tax break on jet fuel – told reporters: “You don’t feed a dog that bites your hand.”
Finally, for Democrats, the leftward shift of business is a mixed blessing.
On the plus side, Democrats gain an ally in pressing a liberal agenda on social and racial issues.
On the downside, the perception of the party as allied with corporate interests may take root and Democratic officials are very likely to face pressure to make concessions to their new allies on fundamental economic policies – bad for the party, in my view, and bad for the country.