The Rise of Woke Capital

Here are two stories about corporate America’s current role in our politics and common life. In one, the country’s biggest companies are growing a conscience, prodded along by shifts in public opinion and Donald Trump’s depredations and their own idealistic young employees, and becoming a vanguard force for social change — with the recent disassociations from the NRA by major airlines and rental car companies just the latest example in a trend that also includes recent high-profile corporate interventions on immigration and gay and transgender rights.

In the other story, corporate America just performed another bait and switch at the common good’s expense — making a show of paying bonuses and raising wages after the passage of the corporate-friendly Republican tax bill, but actually reserving most of the tax savings for big stock buybacks, enriching shareholders rather than employees in an economy where wage growth still disappoints.

These are not two stories, though; they’re different aspects of the same one. Corporate activism on social issues isn’t in tension with corporate self-interest on tax policy and corporate stinginess in paychecks. Rather, the activism increasingly exists to protect the self-interest and the stinginess — to justify the ways of CEOs to cultural power brokers, so that those same power brokers will leave them alone (and forgive their support for Trump’s economic agenda) in realms that matter more to the corporate bottom line.

There was a sincere patriotism woven in to this model, but also a lot of self-interest. The system defined by the so-called Treaty of Detroit, the labor-management agreements struck between Walter Reuther and the Big Three automakers, was well-intentioned but also self-interested, a necessary-seeming concession to political trends that might have threatened corporate independence and profits even more.

Over time, though, free trade and globalization and deindustrialization made that postwar system less economically viable; the decline of labor and the collapse of the New Deal coalition made it less politically necessary; and the cultural revolutions of the 1960s and 1970s made its implicit moral values (heteronormativity for workers, a kind of penny-pinching puritanism for bosses) seem less congenial and more oppressive. And so we entered a period of corporate hegemony in both political parties, with fewer political compromises required for doing business.

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.

Much of this signaling is sincerely motivated. I’m sure that lots of people in the corporate ranks at Delta or Alamo sincerely abhor the NRA, just as most of the people who demanded James Damore’s firing from Google or Brendan Eich’s ejection from Mozilla regarded both men as beyond-the-pale bigots.

But a certain amount of cynicism is also in order. It’s worth noting, for instance, how Tim Cook’s willingness to play the social justice warrior when the target is a few random Indiana restaurants that might not want to host hypothetical same-sex weddings does not extend to reconsidering Apple’s relationship with the many countries around the world where human rights are rather more in jeopardy than they are in the American Midwest. And the sin of Damore’s infamous memo on sex differences was to explicitly defend a reality — the nerdy-boys'-club culture of the tech world — that Silicon Valley’s mostly male bigwigs are quite happy to sustain, even as they use gender-diversity initiatives to toss some incense to egalitarianism.

The interesting question is whether the incense-tossing works. In certain ways the Peace of Palo Alto won’t be fully tested until the next time the Democrats hold real power, when we’ll get to find out whether the left’s anti-monopoly forays have any follow-through, whether more than a token portion of the Trump corporate tax cuts will get rolled back — or whether corporate wokeness will suffice as a concession to the new spirit of liberalism, enabling the easy post-1980s relationship between corporate America and the Democratic Party to endure.

If it does it will offer partial confirmation of an argument that James Poulos proposed in The Hedgehog Review last year — that the hollowing out of all the old communities in American life has left the corporation, however mistrusted and even vilified upon occasion, as one of the last plausible vessels for communitarian yearnings, offering in branding and employment and consumption “a fixity that we struggle to find within ourselves or in the consolations of love, faith or honor.”

“As much as we fear corporations gone wild,” Poulos concludes, “we love corporations that love us.” And in a rich society people may prefer that their #brands prove this love by identifying with favored social causes rather than through the old-fashioned expedient of paying their workers a little bit more money. Or some people may prefer it, at least — the professional classes, blessed with material comfort, and those groups designated as being on the official winning side of history. For others, though, the Peace of Palo Alto has rather less to offer. It confirms the blue-collar suspicion that liberalism is no longer organized around working-class economic interests. And it encourages cultural conservatives in their feeling of general besiegement — their sense that all the major institutions of American life, corporate as well as intellectual and cultural, are arrayed against their mores and values and traditions.

Between them these trends and sentiments will help sustain the Republican Party even as it lurches deeper into demagogy and paranoia — by making a vote for the GOP the only way to protest a corporate-backed liberal politics that seems indifferent to the working man and an ascendant cultural liberalism that has boardrooms as well as Hollywood and academia in its corner.

But of course so long as this same Republican Party remains itself pro-corporate in its economic ideology — as the Trumpified GOP, despite his populist forays, has determinedly remained — the corporate interests themselves stand to lose little from these polarizing trends. Their wokeness buys them cover when liberalism is in power, and any backlash only helps prop up a Republican Party that has their back when it comes time to write our tax laws.

The win-win scenario for woke capitalism can’t last forever. But it might be quite the racket while it lasts.