In the Trump and post-Trump world, politics have increasingly been injected into every aspect of our lives and now we see that the polarization is taking still another turn—this time in the corporate world. Major corporations, such as Coca Cola and Google, for whom political stances are to be avoided at all costs on pain of losing customers, have increasingly been led to take positions on major issues. The results are now being seen in the response of some State Treasurers who are banning “politically unfriendly” corporations from doing business in their states.
At one point Mitch McConnell warned corporations to “stay out of politics” as they aligned themselves with the perceived liberal political stance of their employees and customers. Other Republican politicians, such as Marco Rubio, accused these liberal-leaning corporations of engaging in “woke politics”. That warning seemed to be expedient for McConnell when it worked to the Republicans’ favor, today the Republicans are singing a different tune and they themselves are deeply into corporate politics, trying to push their agendas by controlling business practices.
Recently, adopting a punitive measure, Republican officials stripped Disney of a special tax status because the company opposed a new education law that opponents call “Don’t Say Gay”. However, now the attempt to stymie what Republicans deem to be “woke politics” has taken a different turn.
Last week, Riley Moore, the treasurer of West Virginia, used a new state law to ban five Wall Street firms, including Goldman Sachs and JPMorgan, from doing business with the State because, he said, the companies were engaging in practices inimical to the coal industry. Similar bans are probably on the way elsewhere. Lawmakers in a handful of other states, including Kentucky and Oklahoma, have already passed laws that resemble the one in West Virginia.
Treasurers in three states have also withdrawn a combined $700 million from investment funds managed by BlackRock, the world’s largest asset manager, over objections to its stance on environmental issues.
Penalizing companies for their support of business practices that the Republican Party finds unacceptable is part of a larger strategy by Republican treasurers to promote fossil fuels and prevent climate action at both the federal and state levels. The treasurers are working with a network of conservative groups that have ties to the fossil fuel industry, such as the Heritage Foundation and the Heartland Institute.
State legislators disclaim any charge that they are playing politics, their position is merely that they are promoting the interests of their citizens by protecting their jobs and doing business only with those corporations that further that goal. If a bank does not want to do business with the coal industry, for example and the coal industry is a major employer in their state, then the State Treasurer will simply cut them out by banning them. This is the case in West Virginia.
On the other hand, banks argue that if they consider it a bad investment, they are perfectly free to steer clear of that enterprise. If, for example, they think that investing in gas and oil is a better investment than coal, they should be free to do so, regardless of the political stance that the optics may suggest, and certainly free of political meddling from legislators. What’s more, banks are arguing that their investments should reflect the current reality and given the clear trends of climate change, in their view, everyone will need to adjust their policies and decisions to fit the situation. Coal is on the way out, and therefore it’s a bad investment.
Nevertheless, legislators deciding to target corporations and punishing them for their choices further exacerbates the extreme polarization and partisanship that is roiling this country. It is now also leading to what New York Times contributor David Gelles has called red brand and blue brand corporations. The idea that our national hyper-partisanship is working its tentacles into every aspect of daily life, from religion to civil rights and now to the corporate world, should be worrying.
Some legislators, such as Noah Friend, a Republican lawyer who previously worked for Kentucky’s treasurer, said, “I don’t like the idea that if you’re a Republican, you have to bank with this company, and if you’re a Democrat, you have to bank with that company”.
The trend of polarization and politicization is already a scourge that feeds the division in this country, and Gelles speculates on how far its incursions will have spread by 2041:
“Even clothes have become fully politicized in 2041. As Americans sought for evermore obvious ways to flaunt their tribal allegiances, two brands that were previously middle-of-the-pack retailers — Levi’s and Wrangler — have become corporate juggernauts. At Democratic rallies around the country, the red Levi’s logo is just as ubiquitous as red Make America Great Again hats were during the 2016 presidential campaign. In Republican strongholds, Wrangler jeans are as common as Nike shoes.”
Perhaps I’m more cynical, because while Gelles imagines this as a future scenario, I look around and see that this kind of physical manifestation of our political positions is already here in the most mundane aspects of our lives. The difference is that with this latest initiative, Republican legislators are using the purse strings to ban and punish what has always defined America: “free enterprise”.