In recent years, a rash of companies suddenly discovered a new “woke” identity, taking sides with the left in America’s ongoing cultural civil war. Now, after a powerful popular backlash, many of those same companies are retreating from the fight. Smart move.
Companies have apparently discovered that Instapundit’s oft-quoted rhyme, “Get woke, go broke,” isn’t a joke. It’s more like an economic truism.
Americans, it seems, don’t like having their cherished cultural, personal, religious and moral beliefs belittled, diminished and ridiculed by the very corporations they do business with.
The latest company to suffer for its wokeness is State Farm, not exactly known for its cutting-edge social activism. And yet, its recent foray into identity politics through a partnership with a group called The Gender Cool Project alarmed even its own employees with its alienating message to customers.
The “partnership” was intended to donate books on transgenderism and gender fluidity to schools in an effort to “increase representation of LGBTQ+ books and support our communities in having challenging, empowering, and important conversations with children Age 5+.”
But “after the CEO reportedly heard from more than 2,000 independent State Farm agents nationwide (and probably a flood of customers), the company announced that it was ending its partnership with The GenderCool Project,” as RedState reported.
So much for Woke Insurance.
Similar things are happening across the country, as companies get woke to a different reality: Americans largely don’t like companies meddling in politics and social issues, and prefer not to be lectured by woke CEOs about raising their children.
The trend has picked up speed following a relentless stock market sell-off in in recent weeks.
“In this lowering tide, woke is revealing itself as a barnacle, and companies are responding accordingly,” RealClearMarkets recently noted.
The turnaround seemed to gather steam after Disney CEO Bob Chapek abandoned the company’s usual political neutrality to publicly butt in on local Florida politics by opposing the popular Parental Rights in Education bill. Now law, it prevents Florida schools from teaching about sexual orientation and gender identity to K-3 students.
That was bad enough. But then a video surfaced showing a Disney official loudly boasting about the “not-so-secret gay agenda” that the company would impose on unwitting families visiting the “Happiest Place On Earth.”
Chapek was surprised when Disney’s LGBTQ activism generated political pushback in the form of Florida Gov. Ron DeSantis asking the state legislature to revoke longstanding tax benefits and company rights that only Disney enjoyed, a move that will cost Disney hundreds of millions of dollars in coming years. Ouch.
Making it worse, financial markets have punished woke Disney shares relentlessly, with the Dow 30 stock losing 33% of its value since the start of the year, roughly $88 billion in total market capitalization. Shareholders, who bore the brunt of the Disney share meltdown, remain furious.
If nothing else, Disney served as a kind of warning to others about the Wages of Woke. In recent weeks, companies as diverse as Netflix, Old Navy, Exxon, and Warner Bros. Discovery, parent of CNN, among others, have all backed off woke policies. Others are doing the same.
Fed up, former McDonald’s CEO Ed Rensi has formed a group called The Boardroom Initiative to encourage companies to focus on the bottom line, not trendy leftist politics. That’s especially important now, with the Commerce Department on Thursday reporting that corporate profits fell by $66.4 billion, or 2.3%, in the first quarter. That’s the first drop in almost two years.
“Corporations have no business being on the right or the left because they represent everybody there and their sole job is to build equity for their investors,” Rensi told Fox Business.
Once upon a time, American corporations understood that their role was to make the highest returns possible for their shareholders. In recent years, companies have broadened that role to include “stakeholders.” That means anybody, really.
That’s where the social activism comes in. Far-left pressure groups have targeted company after company, scaring weak CEOs into backing radical social movements, ranging from BLM to LGBTQ to “Defund the Police.”
It’s time to return to basics. The goal is to get companies to focus on fundamentals, not on changing America into something unrecognizable.
For those old enough to remember, way back in the late 1960s and into 1970s, corporate bigwigs similarly cozied up to the left, giving big money to support spurious causes all in the name of virtue-signaling their “social conscience.”
Those companies quickly ran afoul of economic realities of 1970s-era stagflation.
In a similar way, today’s companies are running up against the hard realities of high inflation and slow growth. Time to pull back on preening political posturing and focus on turning profits by making customers happy.
It’s hard to improve on Nobel-winning economist Milton Friedman’s insight in a now-famous 1970 column in the New York Times Magazine: “There is one and only one social responsibility of business — to use its resources and engage in activities designed to improve its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition, without deception and fraud.”
Woke corporations, now struggling with ruined brands and falling profits, would be wise to return to focusing on their core businesses and leave the extremist poison politics to others.
— Written by the I&I Editorial Board
These CEO’s are using shareholder money to pursue their personal political agendas. Fire them who do.