The Corporate Scolds of Contemporary Capitalism

At the recent National Conservatism conference in the US, Fox News host Tucker Carlson made the startling observation that the biggest threat to personal freedom was now not the State but the Corporation.  Carlson suggested that making this claim was unbelievable, even to him. Similarly, Matthew Crawford in American Affairs talks of “outsized commercial entities that play a quasi-governmental role in our lives”.  US Senator Tom Cotton calls the new corporate reality nothing less than a “dictatorship of woke capital”.

No less a woke oligarch than Mark Zuckerberg himself has stated, “In a lot of ways Facebook is more like a government than a traditional company … We have this large community of people, and more than other technology companies we’re really setting policies.” George Orwell must be spinning in his grave.

Is Carlson’s making this claim, and is it plausible?  Well, yes, it is entirely plausible, and this should chill us all. Many of us, for a long time, have been defending corporations against what might be termed the “old Left”. What Carlson was referring to is not simply the “corporation” as we all once knew it.  No, he is speaking of the emergence of a fundamentally new kind of corporation.  Let me explain.

The modern corporation – ubiquitous, unaccountable, condescending, emboldened, menacing – acts on a very, very broad canvas, with coercive powers and in ways previously unimagined, way beyond the original remit of traditional private sector companies. 

These are corporations that enforce oppressive new rules and protocols for employees, contractors and recipients of sponsorships, rules that are inimical to the exercise of personal freedom, of freedom of speech and of conscience.  They are seeking to set social standards for us all, they are limiting behaviour in the workplace, they are attacking opponents, they are punishing and rewarding governments according to whether their policy decisions meet corporate approval, they are boycotting states (in the US), they are bullying other businesses. In short, corporations are seeking to drive social change and this is constraining individual lives and transforming our culture — all in ways that not so long ago only governments could and did. 

Corporates now seek nothing less than to change society.  They sometimes admit this.  And often these corporations are in monopoly or near-monopoly situations in many markets, beyond the reach of countervailing consumer power.  They are projecting the ideologies of global elites and oligarchs, and wielding the power of governments to do so.  Corporations now make our lives less livable, they threaten our self-government, in so many ways – as employees, as businesses, as customers and as citizens.

As Matthew Crawford says:

For what does Silicon Valley represent, if not a locus of quasi-governmental power untouched by either the democratic process or by those hard-won procedural liberties that are meant to secure us against abuses by the (actual, elected) government? 

Silicon Valley, and the woke corporation more broadly, represent power without authority.  They see themselves, undoubtedly, as a force for progress.  But what if they are merely an instrument of soft(ish) despotism?

This is a new way of doing business for the “firm”, whose core purposes were first defined by the economist Ronald Coase in the 1930s, and whose traditional methods, for example through marketing, advertising and sales, are very familiar.  As Paul Rowan Brian notes:

From Silicon Valley to Wall Street, an increasing number of corporations are choosing to prioritize feel-good progressive slogans and activism over traditional advertising strategies that highlight the value or features of a product or service.

Merely to make profits for firm owners, to provide returns for shareholders, and to create employment for managers and workers is no longer the only game.  Perhaps it is not even the main game. 

Things have also moved way beyond the once fashionable “corporate social responsibility”.  The “woke corporation” (see also “woke capital” and “woke capitalism”) engages in activism-as-marketing, certainly.  But, having already determined that it is its right to define morality and social norms, the woke corporation also seeks to re-educate (employees and customers), to influence (policy makers), to impose conformity within organisations (through the punishment of conscientious objectors, for example through non-promotion), to shape the core values of individuals (by, for example, venue providers non-platforming opponents of woke ideology) and to effect what amounts to massive social change.  Defining what is and isn’t “hate speech” is but one obvious example of the corporation’s assumed power.

This is new, and quite simply, astonishing, the sheer breadth of the activities of the woke corporation breathtaking.  Hence to think that the power of the woke corporation is confined to bullying, even sacking its own employees (a la Israel Folau) would be a mistake, as important as this issue is.  Bullying employees into correct thinking is but one line of activity.  There is a whole society to renovate.  Matthew Schmitz at First Things, writing about the Obergefell case through which the US Supreme Court, in effect, mandated legal same sex marriage across the 50 states, noted that 379 companies issued an amicus brief to the Court, arguing that same sex marriage was in their commercial interests.   

As Schmitz observes:

They argued: “Allowing same-sex ­couples to marry improves employee morale and productivity,” which contributes to “significant returns for our ­shareholders and owners”. 

Schmitz calls this behaviour “cultural realpolitik”.

Corporate wokeness is seemingly so widespread, so all encompassing, that consumers seeking to punish companies that seek to impose or to champion values that are abhorrent to them might not actually have much choice at all in the marketplace.  Alan Joyce, CEO of Qantas and Australia’s Wokemeister-in-Chief, clearly sees this as a good thing.

There is some pushback emerging in the public square.  Former senior Australian politicians such as John Howard and John Anderson have lamented this relatively new phenomenon of the progressive, activist corporation. In a speech to the Knights of Malta, reported in the Catholic Weekly, Howard cautioned against the politicisation of corporations and other organisations in the current religious freedom debate in Australia. “The first, and I think the most unwelcome development, has been the growing disposition of organisations and companies to take positions on social issues,” he told several hundred members of the Order of Malta in Sydney in late July.

He also questioned the right of businesses to make a person’s religious beliefs subject to an employment contract. Mr Howard referred to 2017’s same-sex marriage debate and the recent Folau case as examples. “I think this is a terrible development and I first saw it at the time of the debate on same sex marriage where a large number of well-known companies took a position [in favour of same sex marriage],” he told an audience gathered at the Hilton Hotel. John Anderson has referred disapprovingly to Corporate Australia’s bid to become the country’s “moral arbiter”, in the context of the Folau case.  

Focusing on the UK workplace, Toby Young in The Spectator recently weighed in on the insidiousness of cloying, invasive woke capitalism:

New employees at the British headquarters of Accenture, a global management consultancy, were slightly taken aback during a recent induction morning when the head of human resources encouraged them to wear rainbow-coloured lanyards declaring themselves ‘allies’ — not just at the meeting, but permanently. In addition, they were given the option of adding the word ‘ally’ in the same rainbow pattern to the footers of their company email addresses. Anyone confused by HR language — a reference to the second world war perhaps? — was referred to the company website, where the word ‘ally’ was helpfully defined: ‘An ally is someone who takes action to promote an inclusive and accepting culture regardless of their own identity and demonstrates commitment to an inclusive workplace. We currently have allies programmes for Mental Health, LGBT and People with Disabilities.’

Young continues:

Crackpot ideas that used to be confined to neo-Marxist professors in grievance studies departments have been enthusiastically embraced by the giants of capitalism. Apple, Amazon, Facebook, Goldman Sachs, Coca-Cola are all on board and anyone who publicly challenges this new orthodoxy is not merely endangering their chances of promotion, but at risk of being fired.

Yes, they are crackpot ideas.  But crackpot ideas that are now widely and cravenly accepted and which, all of a sudden, affect many lives, careers and jobs – and therefore pay packets, and as a consequence, personal freedom.  Toby Young himself, of course, was the victim of a social media witch hunt in the UK when forced to resign from a higher education job in the UK earlier in 2018, over politically incorrect past comments.

(LGBT is an acronym that is now familiar to all.  BAME is a new one on me – black, Asian or minority ethnic.  People associated with these ubiquitous acronyms are subject to employment targets, and the rest of us, of course, are subjected to the thought control attempted by the kinds of companies to which Toby Young refers).

The development of woke capital is not confined to Britain or indeed the USA.  It is rife in Australia and, no doubt, in other Western countries.  Many of us have been directly exposed to the ubiquitous diversity training regimes in the workplace, normally associated with having the “right” attitudes to race, gender and sexual preference and the need to eliminate “unconscious bias”.  Public sector workplaces in particular are seedbeds of woke thinking and HR-led policy at all levels of government, including local councils.

Nor is wokeness enforcement confined to the workplace, as we know.  Sickeningly, it is all about in the public square, literally. Councils in both my current place of residence (Lismore NSW) and one of my favourite cities (Wellington NZ) have succumbed to the lure of installing a rainbow pedestrian crossing.  Rainbow flags flutter here and abroad, during the Obama years on the White House, no less. Bombarding the public square, both physical spaces and through the use of media, with wokeness, is a corporate as well as a government activity. 

One recent exponent of using advertising’s megaphone is the McCain’s food company which has taken to promoting the diversity of families, some of which have “two daddies”, featured in the McCain’s “we are family” advert at meal time affectionately kissing.

Here we are witnessing both an appeal to the gay consumer and the woke consumer.  As Schmitz says:

Large corporations donate to LGBT causes, lobby against religious freedom laws, and present gay people as avatars of consumerism.

None of the above will be remotely news to readers of Quadrant.  The instances of woke bullying and woke indoctrination have (predictably) risen exponentially since the same sex marriage plebiscite in 2017, with equally foreseeable consequences for the religiously inclined, and indeed for anyone whose conscience is disturbed by the creeping political correctness that has gone from a trickle to a flood.

Nor will readers need to be convinced as to just how dangerous to our liberty and democracy this new era of woke capitalism is.  Shoshana Zuboff’s bracing book, titled The Age of Surveillance Capitalism: The Fight for a Human Future at the Frontier of Power, is a stark reminder of just how much is at stake.  While Zuboff’s focus is on the role of technology in surveilling us all, it is the combination of technological means and thought control ends that should give us the ultimate cause for worry.  Aggressive wokeness and technology-enabled scrutiny of citizens are clearly overlapping categories, each threatening of our welfare and together potentially lethal.  They form what Matthew Crawford calls “ … a metastasizing grid of surveillance and social control”. Wokeness has been turbo-charged by invasive technology.

Joel Kotkin is another (blue dog Democrat) critic who sees the danger of what he terms “gentry progressivism”.  Indeed, he refers to it as “corporate vigilantism”, noting a recent survey showing that a staggering two-thirds of CEOs believe their role is to “shape society” and also that some of the most activist companies are those having near monopolies in their industries.

Readers might not, however, be aware of just how far things have gone, nor of some of the weird recesses of the market for woke products.  How many of us, for example, know about the company Tuck Buddies which makes underwear that helps trans boys hide their penises?

A larger question than the incidence, extent and the implications of woke capitalism and a question of great interest, though, must be ‘How on earth did we get here?’  When did corporations discover their inner wokeness, and how did all this come about?  If politicians feel safe to “come out” in public displays of rainbow ticking, well there must be a constituency for it, equally for corporations. For the private sector, two things of great significance have happened in our lifetimes.  First, companies have realised the new consumer is prone to make “ethical”, values-based decisions about purchases, and the new shareholder is prone to invest in companies with whose values they identify. And second, they have recognised the emerging market power of millennials (aka Gen Y, born between about 1980 and 2000). 

For “ethical”, we now should read “woke”.  Ethical purchasing is no longer just about avoiding products that involve cruelty to animals or fleecing third world workers.  It is about both punishing some companies and rewarding others.  It extends to energy production (coal disinvestment strategies by banks), pariah countries (Israel), pariah US States (anyone anti-abortion) and pariah companies (Chick-fil-A).

Those of a progressive mindset have come to realise that they can express their policy preferences through far broader mechanisms than just voting or joining a political party.  In fact, given how relatively unimportant parliamentary politics now are in driving social change, and given how combative and all-encompassing the culture wars have become, it would be surprising if this were not the case.  Hence, left leaning “policy consumers” can now signal their virtue and try to effect social change through investments, purchases, choices of organisations for which to work and public displays of new-left virtue.

And since cowed conservatives and traditionalists, never known for public or provocative displays of their tightly and silently held views,  are now even scared to tell pollsters how they feel, it should surprise no one that the public square has been invaded by the woke brigade.

Taking a benign view of corporate wokeness, corporations perhaps are simply trying to keep up with what they perceive to be social trends.  They don’t wish to offend their customers or shareholders in increasingly competitive markets and in an era of instant, and hence powerful, social media shaming and an era too of the newly empowered consumer.  Now it is very easy to switch your consumer allegiances, ditch service providers with the click of a mouse, and dump companies that offend your ethical sensibilities.

Here is Paul Rowan Brian again:

Optimally, the consumer does not merely want what is being sold, but also craves feeling of belonging and social validation that purportedly comes with making that certain buying decision. 

Hence we have “green washing”, “woke washing” and “pink washing”, aka the so-called rainbow tick.

Now, too, just as consumers can very easily and quickly ditch companies which don’t satisfy your inner wokeness, it is equally easy (technologically) for corporations to understand and indeed shape consumer preferences in Zuboff’s “age of surveillance capitalism” noted above.  Companies can and do routinely find out the hidden depths of our consumer behaviour and indeed of our motivations, in order to shape their market offerings.

But corporate behaviour is not just about pleasing customers and shareholders.  It is about pleasing workers as well, in an era of massive employee mobility.  At a time of sluggish productivity gains and stagnant wages and salaries, companies need to find new ways to keep the “talent” in-house.  I think they think they can do this by being woke.

Here is where the millennials come in.  According to Salesforce CEO Marc Benioff:

CEO activism is not a leadership choice, but a modern – and an evolving – expectation. CEOs have to realize that millennials are coming into the organization and expecting the CEO to [publicly] represent the values of that organization.

For a number of reasons, millennials are the most woke generation ever to walk the planet.  Perhaps this results from the coincidence in time of four powerful trends – millennials coming of age when relativism as a ruling ideology hit a take-off point, feel-good funky parenting kicked in, leftists stormed the educational establishment at all levels and content and history were removed from curricula.

Another version of the millennial connection suggests that it is the incoming hordes of millennials joining the workforce who are simply importing the deeply embedded wokeness of the university system they are leaving.  Nowadays up to half the young attend university.  The higher education sector and deluded types all want this percentage to go even higher.  So there is a steady stream of wokeness coming in the corporate door in the form of activist employees, constantly shaping HR thinking and executive behaviour in ways that relentlessly push corporate behaviour in a leftist direction.  This is highly plausible.

William Anderson of the free market website Mises Wire has focused on millennials and the recent Nike kerfuffle related to company’s recall of it shoes which featured the now highly non-PC War of Independence era Betsy Ross flag  with the first whiff of push back, its appointment of a knee-taking footballer Colin Kaepernick and the predisposition of certain market segments (blacks and youth) to support companies which express those “correct” views. Social issues and a brand’s bottom line go hand in hand for millennials. A total of 15,191 investors on Robinhood added Nike to their portfolios when Kaepernick’s ad was released, according to Business Insider. Additionally, Nielsen reported 38 per cent of African-Americans between the ages of 18 and 34, and 41 per cent of those aged 35 or older, said they expect the brands they buy to support social causes.

The New York Times’ Ross Douthat has weighed in as well, with a quite different take on the reasons for the emergence of the woke corporation.  Douthat argues quizzically that corporations are still about the bottom line above all else, and are simply playing the game by (cynically) taking on board a modish leftism in order to keep left-of-centre governments and consumers happy while they plunder the Third World and reap the advantages of free global markets and a borderless world. Says Douthat:

But there are other ways to compromise besides on wages, and at an accelerating pace our corporate class is trying to negotiate a different kind of peace, a different deal from the one they struck with New Deal liberalism and Big Labor. Instead of the Treaty of Detroit we have, if you will, the Peace of Palo Alto, in which a certain kind of virtue-signaling on progressive social causes, a certain degree of performative wokeness, is offered to liberalism and the activist left pre-emptively, in the hopes that having corporate America take their side in the culture wars will blunt efforts to tax or regulate our new monopolies too heavily.

On this view, culture is merely a tool of self-interest.  Joel Kotkin concurs, noting that the woke push “gives street cred to the ultra-rich” and is, in effect, a massive diversionary tactic.

Some on the right question whether corporate wokeness actually helps the bottom line.  The socially aware corporation has moved from a “we are ethical” position to one which says “we are progressive”, assuming that this reflects what the market wants.  Such a strategy is not without risk, of course.  Remembering that 40 per cent of Australians do not support same sex marriage, and using this as a proxy for social/cultural traditionalism, companies hell bent on overturning values and bullying employees in the process might begin to think twice about their relentless push towards a secularist paradise on earth.

Of course, traditionally conservatives tend to abhor activism and endlessly seek the quiet life.  Fighting a culture war involves effort.  So does consumer activism.  The lefty corporates must hope that this continues to be the case, lest their bottom lines suffer from their progressive stances on everything under the sun.  (Of course, as noted above, many of the most woke corporates have near monopoly market power and so a few agitated traditionalist protesters are hardly likely to shake the foundations of their enterprises).

The American writer Rod Dreher has spoken of the sheer nastiness of the woke corporation which, in one recent ghastly intervention, claimed that abortion is good for business while at the same time threatening to boycott pro-life states. Dreher, author of the widely read and much quoted The Benedict Option, is currently working on a book on soft totalitarianism (the present working title, ‘Rules For Everyday Rebels: Twenty Lessons In Resisting The Cultural Revolution‘). Perhaps Dreher’s next book will provide the toolkit needed for traditionalist deplorables to fight back.  In Australia, only Mark Latham among the current crop of right-of-centre leaders appears up for the fight.  If he can build a political movement around him, it might just start the long and painstaking process of the reverse cultural engineering needed to restore sanity to the public square and reassure fogeys young and old there is a place for them in our current world.

We should all be very frightened of the super-woke and of the biggest corporations, who can simply withstand any amount of consumer disquiet since they are virtual monopolies, or as Joel Kotkin notes, somewhat chillingly “states within states”. 

The latest technology will only make things even more Orwellian, it seems.  Google executives talk about “machine learning fairness” —  AI-led decision making about such things as hate speech in the workplace — as an enforcer of cultural norms.   Matthew Crawford terms this phenomenon “algorithmic governance”, and it should be a cause of considerable alarm. And corporate wokeness is not going anywhere, anytime soon.  If the London Daily Telegraph, of all places, can now have a Head of Diversity, Inclusion and Belonging (one Asif Sadiq MBE), then the victory is all but complete. According to Asif:

Diversity is no longer just a HR strand or a stand-alone department that looks after policies that impact people. But rather [it] needs to be in the foundation of every department and team within a company. We must not forget the commercial benefits of diversity, especially when companies are trying to gain momentum in new markets, reach new audiences and diversify their income but unless you understand your potential customers and what they want, you will not be successful. It’s important to always remember that D&I departments can help with this and support your efforts in new markets through utilising their insights, knowledge and experiences of engaging with diverse communities.

… I was speaking to someone recently and we were talking about the fact that, once upon a time, Technology used to be a sub-department within IT and now it’s a whole business area by itself that has reach and impact across an entire organisation. I see D&I in the same way. In the future, more companies will have Chief Diversity Officers and D&I departments that have reach across the business playing a role in all elements of the business. 

This is why we need to start considering D&I as part of the wider business and if we are going to make true change within any organisation we have to embrace D&I as a business imperative not just a HR policy. 

So yes, for the modern corporation diversity is both woke grandstanding and business strategy.  The corporate world has made a call, and the metastasising political correctness this entails will  continue to embed and spread, serving its many corporate purposes, all the while diminishing our freedoms in ways once the privilege of the State.

Meanwhile, back at Fox News, Tucker Carlson himself is (unsurprisingly) a target of a woke social media push, with attempts to have consumers boycott those unwoke companies who advertise on his show.

The war goes on.