Talking Points

The opposite of woke capitalism is still capitalism

It's a sign of how much the Donald Trump era has scrambled our politics that the American right — which not so long ago reflexively and joyfully defended capitalist prerogatives — is now actively considering whether big business has become so powerful that it poses a threat to individual liberty.

Such arguments used to belong almost exclusively to progressives. But at a recent debate hosted by the conservative Federalist Society, attorney Ashley Keller argued that the government should use its antitrust power to crack down on Big Tech corporations that censor conservatives, businesses that subject their employees to diversity training, and companies that put "woke" messages out to the public. "Seemingly overnight corporations have almost uniformly abandoned Milton Friedman's shareholder primacy model of the firm," Keller despaired.

As Keller went on to explain it, Friedman "had this crazy idea that the purpose of a company is to make money, not to take shareholder resources to support social agendas." And while that "doesn't mean that CEOs can't support political causes … they should do it with their own money, not the official infrastructure, brand, and massive treasuries of the companies they run." Otherwise, Keller stressed, "corporate agents can do whatever the hell they want. And what do they want? Why, to virtue signal to the woke, of course."

Friedman's ideas about shareholder primacy dominated corporate thinking for most of the last 50 years, but they have come under recent scrutiny. In 2019, a coalition of nearly 200 CEOs issued a joint statement rejecting Friedman's philosophy in favor of a "stakeholder capitalism" that recognizes corporate responsibilities to workers, their communities, and the environment. "These modernized principles reflect the business community's unwavering commitment to continue to push for an economy that serves all Americans," said Jamie Dimon, the chairman and CEO of J.P. Morgan Chase.

But Keller's argument has some obvious deficiencies. For one, businesses weren't really sitting on the political sidelines before the rise of woke capitalism: They marshaled immense resources to elect politicians and enact policies precisely because they pursued profits. (They continue to do so.) What's more, corporations aren't all that woke — they may pay lip service to racial equality and voting rights, but when it comes to their actual practices, they're rarely progressive. And it's not like the profit motive has gone missing.

Progressives might be tempted to make occasional alliances with "common good" conservatives like those who support union drives, write paeans to the dignity of workers, or advocate cracking down on Big Tech monopolies. But Keller's comments make clear the left and right don't really share the same agenda. A return to the embrace of shareholder primacy wouldn't be very woke, but it would be extremely capitalist.