Leon Trotsky’s dictum that “you may not be interested in the dialectic, but the dialectic is interested in you” applies equally well to the culture wars, as Walt Disney Co.’s chief executive officer Robert Chapek is discovering to his chagrin. Chapek tried to stay neutral on one of the hottest issues in the culture war — sex education for young children — but ended up infuriating both sides. He is now fighting for his future in the Magic Kingdom while fending off brickbats from the Right Nation.
In this case the culture wars have taken the form of Florida’s blandly named Parental Rights in Education Bill, which passed the state legislature on March 8 and awaits the governor’s signature. The bill prohibits instruction on sexual orientation or gender identity for children in kindergarten through third grade, or for older students if not “age-appropriate or developmentally appropriate,” and makes it easier for parents to sue if they judge that the regulations are not being followed. Conservatives regard the bill as a righteous attempt to reclaim parental rights from activist teachers while the left dubs it the “Don’t Say Gay” bill.
Chapek’s silence over the bill led to complaints, protests and walk-outs across the Magic Kingdom. Staff at Disney-owned Pixar Animation Studios said that they were “disappointed, hurt, afraid and angry.” Fund manager Ross Gerber tweeted that Chapek is the “worst” leader of Disney he can remember and called for a “CEO with a moral compass.” A chastened Chapek is now trying to save his leadership with a combination of groveling apologies (“you needed me to be a stronger ally in the fight for equal rights and I let you down. I am sorry.”) and escalating promises to do better in future (“I and the leadership team are determined to use this moment as a catalyst for more meaningful and lasting change”). So far Chapek’s pledges include: fiercely opposing Texas Governor Greg Abbott’s move to ensure that parents who provide gender-transitioning medical care for their young children are investigated for child abuse; putting together a taskforce to ensure that Disney makes more LGBTQ awareness content for children; and reinstating a same-sex kissing scene in the upcoming film “Lightyear.”
But the more Chapek apologizes and pledges, the more he infuriates conservatives. Florida’s governor, Ron DeSantis, lustily lays into the hapless CEO. “The chance that I am going to back down from my commitment to students, and back down from my commitment to parents rights simply because of fraudulent media narratives or pressure from woke corporations, the chances of that are zero,” he said in a recent campaign video. Christina Pushaw, his press secretary, tweeted that “the bill that liberals inaccurately call “Don’t Say Gay” would be more accurately described as an Anti-Grooming Bill. If you’re against the Anti-Grooming Bill, you are probably a groomer or at least you don’t denounce the grooming of 4-8 year old children. Silence is complicity.”
It is all a far cry from the days when corporate politics for the Magic Kingdom meant no more than sprinkling stardust (and cash) around and basking in praise. The opening of the Walt Disney World Resort in October 1971 transformed Florida into a global rather than just an American tourism magnet. Disney is now the biggest employer in Florida with about 75,000 workers before the pandemic struck. The company assiduously contributed to both Republicans and Democrats but naturally lent toward the increasingly dominant Republican Party. The GOP’s passion for low taxes, light regulations and battles with teachers’ unions over school choice suited it better than the high-taxes, persnickety regulations and powerful public-sector unions of its home state, California.
CEOs are now expected, indeed almost required, to speak out on the great social issues of the day, however explosive, as if their job description includes political commentary as well as corporate leadership. In 2015, Marc Benioff, the CEO of Salesforce.com Inc, was highly unusual in the C-suite in publicly condemning Indiana’s new Religious Freedom Restoration Act, earning the unwanted sobriquet of “activist CEO.” In 2020, CEOs queued up to condemn George Floyd’s murder and call for racial justice. In the intervening years corporate tongues had been loosened by a succession of highly emotional events: North Carolina’s 2016 law preventing people from using public bathrooms that do not match the sex on their birth certificates; Donald Trump’s reaction to the 2017 “Unite the Right” rally in Charlottesville, Virginia; a 2018 mass shooting in a high school in Parkland, Florida; and Georgia’s attempt to tighten voting laws after Trump’s election defeat in 2020. An Edelman survey of more than 33,000 people in 28 countries in Jan. 2021 found that 86% of respondents agreed with the statement “I expect CEOs to publicly speak out on one or more of these societal challenges, pandemic impact, job automation, societal issues, local community issues.”
This new job description reflects the rise of what conservatives deride as “the woke corporation” and liberals celebrate as a new iteration of corporate social responsibility. Companies now routinely argue that they are about something more than making profits for their shareholders and products for their customers, trumpeting a lengthening list of socially-conscious aims — tackling climate change; advancing diversity, equity and inclusion; helping the poor; and stabilizing society amid rising inequality and injustice — and employing a swelling army of human resource managers and diversity tsars to put those aims into practice. Management by “feeling people’s pain” is replacing “management by walking around” as the acme of contemporary leadership.
The conservative-dominated Supreme Court inadvertently strengthened the position of corporate activists with its 2010 ruling in the Citizens United case that, as associations of individuals, corporations have first amendment rights and can therefore spend liberally on political causes. Senate Minority Leader Mitch McConnell put his finger on the problem when he warned CEOs to stop acting like a “woke parallel government” and to “stay out of politics” before quickly adding “I’m not talking about political contributions.” Why should companies refrain from talking about sex education in schools if they are legally people who have a right to give unlimited campaign donations?
The war between the GOP and corporate America is likely to intensify. The post-Trump GOP is doubling down on cultural populism. DeSantis, one of the leading GOP candidates for the White House in 2024, is running for re-election for the governorship on a broad program of wrestling back control of the culture from a woke elite that he says is bent on destroying traditional values. Other ambitious Sun Belt Republicans are sounding similar themes in their bid to win the great red MAGA hat of the Supreme Commander of the culture wars.
For their part, corporations are unlikely to downplay woke themes. Successful companies are increasingly dominated by left-leaning knowledge workers who demand emotional fulfilment at work as well as a paycheck, and will move elsewhere if they don’t get it. A 2021 survey by the (newly woke) consultancy McKinsey claims that employees “living their purpose” have four times higher engagement with their work and enjoy five times higher well-being than those who cannot connect their work with “their purpose.”
The next generation of knowledge workers is likely to be even more inclined to social activism than the current generation given the leftward shift in the universities and the squeeze on young people’s living standards. The great division in America is no longer between labor and capital but between credentialed Americans who work in formal institutions such as universities, corporations and government departments and regular Americans who work for smaller companies or live from paycheck to paycheck.
A cohort of GOP politicians and intellectuals is hammering out a “common good” or national conservatism to replace the old pro-corporate orthodoxy, a conservatism that, as well as being anti-woke, is nationalist on trade and borders, catholic in social teaching, pro-family in welfare policy and routinely anti-big business. Senator Marco Rubio pushes for industrial policy to revive American manufacturing. Senator Josh Hawley crusades against “the tyranny of big tech” and laments the destruction of masculinity as a result of the hollowing out of manufacturing. J.D. Vance, who is running for the U.S. Senate in Ohio, decries the twin evils of unregulated capitalism and social liberalism. In the conservative legal world, which has long been defined by pro-corporate jurisprudence, Harvard’s Adrian Vermeule is developing a “common good constitutionalism” that argues “strong rules in favor of the common good” are entirely legitimate.
Yet capitalists cannot rely on the Democratic Party to look after their interests. The ascendant left is just as hostile to globalization as the new right and even more hostile to deregulation. Companies are there to be taxed, lectured and micro-managed, in their view, and the rich to be squeezed until their pips squeak. On March 25, Senator Bernie Sanders introduced an “Ending Corporate Greed Act” proposing that companies that make more than $500 million in annual profits should pay a 95% tax rate on their “windfall profits.” In the Clinton-Bush era the business class had the luxury of choosing between two pro-business parties. Soon it may have to choose between the anti-business devil and the business-hostile deep blue sea.
More from Bloomberg Opinion:
• Wokeism Has Peaked: Tyler Cowen
• Unilever Should Know That Purpose Isn’t Strategy: Chris Hughes
• Kanye West’s Latest Outburst Is a Painful Lesson for Gap: Andrea Felsted
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Adrian Wooldridge is the global business columnist for Bloomberg Opinion. He was previously a writer at the Economist. His latest book is “The Aristocracy of Talent: How Meritocracy Made the Modern World.”
More stories like this are available on bloomberg.com/opinion
©2022 Bloomberg L.P.