Corporate Responsibility in a Post-Trump America
In September, I wrote a short piece in the Wall Street Journal about the social responsibility of the American business community. I shared my thoughts on this subject in response to the controversy surrounding Disney’s decision to thank authorities in Xinjiang province in the credits of their film, Mulan.
At that point, it seemed apparent to me that a reckoning loomed for American businesses with operations in China. At some point in the future, I reasoned, inherent conflicts between profit motive and rising geopolitical tensions with China would force American companies to make difficult decisions regarding their operations there. I still believe these decisions are coming in the future. But after last Wednesday’s insurrection at the United States Capitol, inspired by widespread dissemination of the falsehood that President Trump won November’s presidential election, I now believe that the American business community faces a far more fundamental and urgent reckoning caused by political instability in America.
I wrote in September that corporations operating in the United States “benefit from the rule of law, robust protection of property rights and relative social stability.” The insurrection at the Capitol last week struck a blow against these pillars of American society. The extraordinary steps that American businesses have taken in response demonstrate that they understand the implications of last week’s events, perhaps even better than the lawmakers whose personal safety the insurrection threatened.
As of this writing, only private sector actors have taken formal action against the elected officials who played a role inciting Wednesday’s violence. While Congress dithers, big business in America has sprung into action, suspending political donations to members of Congress who objected to certifying the Electoral College results, cutting ties with President Trump’s business and political operations, and removing social media accounts (including the president’s personal accounts) and websites that played a role in inciting last week’s violence.
I have long wondered whether the economic and social pain stemming from our increasingly unstable politics would eventually force the business community to intervene. As others have discussed at greater length, many large American companies seemed satisfied with the Faustian bargain they struck in the Trump era, benefitting from large corporate tax cuts and deregulation while our political system continued to destabilize. In a recent episode of particularly harmful dysfunction, Congress spent months at a standoff before passing a second coronavirus relief bill, despite widespread agreement among economists that further relief was urgently necessary. Nonetheless, large companies were not significantly affected, and thus the business community was not adequately incentivized to take collective action to force Congress to break the gridlock. The stock market reached record highs and corporate profits generally were strong during the standoff. Small businesses and their employees were forced to endure the pain of congressional inaction.
The events of last week should have crossed a line for the business community. No longer can influential private companies stand by quietly while our toxic politics threatens the rule of law and social stability. Political conditions have deteriorated to such a point that businesses have been forced to take on additional social responsibility. In particular, I believe the business community must now take affirmative action to preserve the basic conditions that allow private enterprise to thrive. In an ideal world, private businesses would not be stuck with such a responsibility. But our elected officials have proven themselves too feckless and irresponsible to be solely entrusted with it.
The business community should be clear-eyed about which elected officials are responsible for political instability reaching the boiling point: President Trump and the Republican members of Congress who participated in his efforts to overturn the democratic will of the people expressed in November’s election. Their actions have disrupted the peaceful transition of power, a bedrock principle of our democratic system of government.
Both political parties deserve some blame for the devolving of our politics into a tit-for-tat game of escalatory warfare in recent years. But it is absolutely clear that President Trump and his Republican enablers in Congress deserve the blame for the dangerous and volatile situation in which our country currently finds itself. The difference in the crowds that descended upon Washington, D.C. to protest Donald Trump’s win as opposed to his loss demonstrates how much he and some Republican elected officials have destabilized our politics. On January 21, 2017, hundreds of thousands marched in peace past the Capitol building wearing knitted pink hats to express their displeasure with Donald Trump’s election to the presidency. Just less than four years later, a violent mob was sent by President Trump to the same building to disrupt Congress’s certification of the Electoral College results choosing his successor. Five people are dead as a result.
I believe the business community is now tasked with this additional responsibility not only because of the events that occurred at the Capitol last week, but because of the potential threat of future, even more destabilizing political violence. The prominent Republican pollster Frank Luntz recently shared a series of disturbing polls of Trump voters. The most ominous response: 64% of respondents agreed that “force” may be necessary “to save the traditional American way of life.” Agitations for civil war are all over the fringes of the far-right internet, including plans for a second attack on the U.S. Capitol and state capitol buildings on January 17. Republican members of Congress reported coming home to constituents “cheering on” the storming of the Capitol, rather than condemning it.
Those who committed acts of violence (or who do so in the future) are personally responsible for their actions and should be held accountable by government authorities. This is not the responsibility of the business community. But those who committed acts of violence at the Capitol last week were inspired to do so by their belief in a lie that certain Republican elected officials peddled and amplified for two months. Because the actions of these elected officials threaten the stability that allows private enterprise to flourish in our country, I believe the business community has a responsibility to take affirmative action against them.
What does this affirmative action look like? In the short term, the business community will need to make bold, and sometimes uncomfortable, forays into politics to fulfill this new responsibility. Most large companies have already issued condemnations of the violence at the Capitol last Wednesday and some have gone so far as to formally denounce the politicians responsible for inciting it. Several companies have pledged to halt political donations to members of Congress who objected to electoral certification results. Those companies that haven’t taken both of these steps should immediately do so. They should make clear which elected officials are to blame for last week’s events. They also should make clear that the halt in donations for these particular elected officials is permanent.
Some companies may fear that these bold steps will deny them a competitive edge by costing them access to influential lawmakers. That is why the business community must be united in this effort, to ensure that no single company can gain an advantage over its competitors by remaining ambivalent to elected officials whose actions threaten the stability of our country. A united front also presents a stronger condemnation of these destabilizing actions to the Republican elected officials responsible for last week’s events.
In the long-run, it is my hope that the business community does not need to bear this responsibility. In a well-functioning society, the government should be responsible for creating and maintaining the conditions that allow private enterprise to develop and thrive. That is not the current state of our society. Several Republican elected officials have calculated that it is to their benefit to spread dangerous and destabilizing lies in order to retain political power. The potential cost of these lies is too great for the business community to continue to allow them to spread without taking action. That is why it must take on this new responsibility now and in the future if our politics continues to pose a destabilizing threat.
