To many on the right, so-called woke capitalism is a grave threat to Western civilization. Conservatives rightly fear not only that corporate America has forgotten that the key to its current wealth is the free market and liberal-democratic values, but also that corporate leaders now often advance a vision of the world that replaces these values with much more progressive ones.
One can see why some are worried. When Georgia enacted what is mostly commonsense voting reform, dozens of companies — including Delta Airlines, JPMorgan Chase, and Apple — issued terribly misinformed statements against the legislation. Major League Baseball even announced it would pull its All-Star Game from Georgia.
This is one of many examples of what appears to be corporate activism, including Twitter’s banning of former president Trump from its platform, Apple’s and Amazon’s attempt to destroy the social-media app Parler, and Facebook’s recent performance as a political pet that suppresses the posts of anyone linking to stories about the possible genetic engineering of the COVID-19 virus and the likelihood of its escape from the Wuhan Institute of Virology in China. (Facebook did an about-face only after President Biden uttered a kind word about the lab-leak theory.)
Conservatives should tread carefully before using the legislative branch to ban woke behavior. Any provisions that limit the power of woke leftists could and would be used against conservatives as well. Furthermore, it is not clear that limiting companies’ political behaviors, including actions that may cost them their own consumers, would be effective. In fact, banning wokeness would be an excellent means of boosting its popularity.
Fighting my deepest fears, I would like here to make the case for optimism. First, the belief that woke capitalism will destroy everything we hold dear is fueled in part by the assumption that corporations that bow to the cultural Left will be rewarded with consumers and high profits. That theory has yet to be tested rigorously. The few attempts made so far have failed to show that woke capitalism has any positive impact on a company’s share prices. But what we do know is that, from an investor’s perspective, “socially responsible” companies can be a money pit relative to profit-seeking ones. Investing in companies that favor wokeness over profit-seeking will probably present the same kinds of risks to investors.
America’s corporations, always in search of higher profits, cannot afford to ignore the risk of going overly woke, given that many consumers are not progressive. That’s the message basketball star Michael Jordan conveyed when he joked about his reluctance to comment on politics by saying, “Republicans buy sneakers, too.” They do indeed. They also watch football and go to movies, and they can be fast to signal their annoyance, as evidenced by the plunge in ratings for the NBA and the Oscars.
In fact, conservative and Republican consumers aren’t totally helpless when the cancel mob comes after the products they like. An example of right-wing defiance came in 2020, when the Left, led by Democratic congresswoman Alexandria Ocasio-Cortez, organized a boycott of Goya Foods’ products after Robert Unanue, the company’s president, praised then-president Donald Trump. But Trump supporters began stocking up on Goya’s goods, and soon the boycott turned into a buycott, with the company’s sales increasing by 1,000 percent.
In addition, it may be that woke capitalism is nothing more than costless virtue-signaling. For instance, when Delta Airlines decided to end its travel discount for NRA members flying to their annual convention, it received a lot of complaints from Republicans, but it cost the company virtually nothing. The airline must’ve known before announcing its move that the program had sold only 13 tickets and that it was therefore unlikely to face any significant consumer backlash, despite Republicans’ complaints. According to Vincent Harinam, writing for Quillette, Delta’s stock remained unaffected. Moreover, Delta showed no sign of sincere aspirations to newfound wokeness, since it changed absolutely nothing about its business practices. The same analysis applies to Nike’s Colin Kaepernick ad campaign, according to Harinam, which fit to a T the demographic of its consumers; hence Nike faced neither reward nor pain.
Other woke gestures are also likely to fall short of progressives’ political expectations. Corporate America’s enthusiasm for “diversity training,” for instance, will surely line the pockets of diversity consultants, but the training is unlikely to achieve its stated goal. On this front, the work of Iris Bohnet, a public-policy professor at Harvard’s Kennedy School, on “diversity training” is telling. “Sadly enough,” she writes, “I did not find a single study that found that diversity training in fact leads to more diversity.”
The main reason for this finding is probably that diversity training offers a sure way for companies to appear righteous and woke without actually having to make any changes to their preferred way of doing business. We have seen this before. For decades, companies have spent billions of dollars subjecting their employees to anti-sexual-harassment training. While such training might have some indirect benefits, such as decreased victim-blaming, evidence suggests it does not stop sexual harassment. In addition, because it can discourage men in leadership positions from working with junior women, it may reduce women’s ability to move up the corporate ladder.
We should expect the same from woke training. It will be annoying for workers, but it will also be toothless and could even be counterproductive from a woke perspective. This may explain why, while many on the right are terrified by woke capitalism, it is also hated by many on the left. Helen Lewis notes at The Atlantic, “If you care about progressive causes, then woke capitalism is not your friend. It is actively impeding the cause, siphoning off energy, and deluding us into thinking that change is happening faster and deeper than it really is.”
Will companies go on forever signaling their wokeness? I don’t think so, as it has already backfired against some of the signalers. That’s because these companies are following confused principles and traveling on a road with changing traffic signs. Are words violence, or does silence kill? It’s hard to tell, and many companies have tried their best to please with wokeness but failed miserably, only to attract unwanted scrutiny.
Take McDonald’s. In 2018, a California McDonald’s turned its golden arches upside down to become the letter “W,” in recognition of women’s global progress and achievements. Nevertheless, left-wing activists from MoveOn.org and other groups hammered the company for its paid-leave and wage policies. This story isn’t unique. Many other companies — including Starbucks, Reebok, and Pepsico — have endured the wrath of the Left when they have attempted to signal wokeness for perceived commercial gain.
Finally, it is hard to imagine that woke workers make great workers. A few years back, Adam Leitman Bailey, a Manhattan attorney who runs a real-estate firm, explained in the Huffington Post that, while he admired the kids coming out of Ivy League schools, he would not hire them. The Wall Street Journal summarized Bailey as believing that these students had “climbed their way to a law degree without testing their mettle,” and, as a result, that they would not meet his firm’s needs. Can we imagine firms refusing to hire Ivy graduates to avoid the woke demands they may bring to the workplace? I can. If enough firms do, it might create incentives for college campuses to curtail the groupthink and self-righteous behavior, such as the refusal to hear ideas one doesn’t like, that feed cancel culture.
Long ago, Friedrich Hayek challenged freedom lovers to constantly make capitalism and freedom exciting undertakings for the next generation. The cancelers and the woke are now handing us a golden opportunity. We promise optimism, freedom, individual dignity, prosperity, and a society that’s genuinely diverse and inclusive. They promise pessimism, fear, despair, central control, economic stagnation, and a society that is drearily uniform in the poisonous beliefs that it preaches.
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