The wall is crumbling, but we are not done yet

In June 2019, Sen. Tom Cotton, R-Ark., delivered a prescient speech in which he coined the phrase “the dictatorship of woke capital,” which was picked up by Steve Soukup as the title of his thorough and thoughtful history of the phenomenon. In the speech, Cotton argued that left-wing activists were using corporations to enforce social outcomes that did not get support in the electoral process. For example, corporations threatened to divest from states that passed heartbeat bills to protect unborn children.

He had a point. When people get a government they didn’t consent to, that seems like a good working definition of dictatorship. The ideological capture and weaponization of corporate America represents an appalling breach of fiduciary duty to shareholders and a betrayal of the trust of customers and employees. But for many “conservatives,” this blatant side-taking triggered a wave of hostility, not just to selected corporations but to capitalism itself. Business was seen as somehow necessarily or structurally permanently hostile to the Christian faith and its moral code. Large swaths of the right simply declared defeat and invoked the state to come in and end the dictatorship of woke capital, as if a state big enough to do that would not be at least as dictatorial as the companies we ask it to rein in.

Recent events show how premature their surrender was. In rapid succession, Tractor Supply, John Deere, Harley-Davidson, Polaris, Indian Motorcycles, Lowe’s, Ford, and now Molson Coors have announced some combination of ceasing the sponsorship of gay pride events, ending the subjecting of employees to humiliating diversity training programs and pronoun policies, dumping racial quotas and carbon limits, and (most satisfyingly) scrapping participation in the annual Human Rights Campaign’s Corporate Equality Index. To get a perfect CEI score, a company must continue to cave in to an annual escalation of demands that, as of now, include employers paying for sexual reassignment treatments for the minor children of employees. But companies that formerly annually bragged about their 100 percent score on this servile capitulation to an extremist political faction are now refusing to fill out the paperwork to even participate in the survey. Thanks be to God!

This is happening for a complex series of reasons. Many have been working quietly to turn back the political capture of companies. Red state treasurers at the State Financial Officers Foundation have been holding companies to account. Ditto for red state attorneys general. A network of policy organizations such as Alliance Defending Freedom, the 1792 Exchange, Consumers’ Research, the Free Enterprise Project, the Manhattan Institute, and The Heritage Foundation have been working behind the scenes and sometimes in front of the scenes providing research, advocacy, and legal support. At Bowyer Research, we have worked with financial advisers such as David Bahnsen and ministries such as the American Family Association to place proposals on shareholder ballots and meet with companies to make the case for political neutrality.

Most recently, a filmmaker-journalist named Robby Starbuck has added social media cascades, providing that final force vector that triggered the landslide. Or a better analogy, one used by Soukup, is more apt for the dictator analogy: It is a “preference cascade,” that moment when a critical mass of disapproval and courage is reached and people speak up, which gives other people the courage to speak up, and, then, down comes the wall.

In addition to the ongoing cascade of reversals from consumer-facing firms with conservative employee bases, recent weeks revealed that BlackRock and Vanguard, the two largest asset managers in America, have dropped their support for environmental, social, and governance shareholder proposals to the low single digits. These numbers are somewhat misleading, as they don’t account for pro-fiduciary proposals from conservative groups trying to push back to neutral. They also do not account for pro-ESG proposals from management, nor for direct lobbying of companies. Still, even with those caveats, large sections of the woke wall around corporate America are being torn down. The counsel of despair that saw the dictatorship but could not imagine its collapse was as wrong as those who believed that the Soviet Union would never fall.

But let’s not get ahead of ourselves. This battle is far from over. Tractor Supply and the rest still discriminate against people of faith when it comes to offering employee resource groups. Pride groups are still there, but nothing equivalent for Christians, who gather in unsanctioned informal prayer and Bible study groups in the catacombs of the lunchroom at break time. And BlackRock and Vanguard not voting for any more ESG proposals freezes things where they are instead of reversing them. We’re not done yet.