Woke capital is destined to become a relic – The Property Chronicle
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Woke capital is destined to become a relic

The Storyteller

In a market economy, consumers vote with their dollars. The survival and growth of a business depends pivotally upon how effectively it convinces customers to buy its products over those of its competitors. But recently, consumers seem to expect a new product in addition to what they were already purchasing from firms: corporate consciousness. In particular, a decidedly left-leaning consciousness.   

But it’s not entirely accurate to claim that consumers have compelled businesses to ‘get with the times’; more precisely, the sensibilities of the public have, mostly through the media and polling, bled into corporate boardrooms. Big businesses have in turn doled out value statements; some are praised, others pilloried. It’s a chicken-or-egg case: did the consumer demand woke capital, or has the corporatist, desperate to maintain market share and boost public perception of their firm, made woke capital the law of the American economy?

A new twist on an old saw

In reality, woke capital is nothing new – though it has undergone many transformations and changes of name over the years. On the individual level, early industrialists like Andrew Carnegie and John D. Rockefeller engaged in corporate philanthropy, donating large shares of their fortunes to charity. In the 1940s, businesses themselves started supporting charitable causes. 

The idea of corporate social responsibility entered the mainstream in the 1970s when the Committee for Economic Development pushed the ‘social contract’ model, stating that businesses function as a result of public ‘consent’, thus leading to an obligation to serve societal needs. (This also ties to the rise and spread of stakeholder theories, which today no MBA programme would dare omit.) That same model outlined three duties of businesses: providing jobs and economic growth, fair and honest treatment of workers and customers, and improving the conditions of the surrounding community. 

It wouldn’t be so unpalatable if it weren’t rife with hypocrisy. This, ultimately, is the cardinal sin of woke capital: lofty moral standards, selectively applied

The present ascendance of woke capital, then, has been less of a rise and more of a continuation – a twist, really – on existing tendencies. The contemporary culture war has only served as a catalyst. A 2020 Spectator piece reads:

“As the Democratic party and cultural elites have lurched left on cultural issues, corporate America has lurched along with them. America’s ‘reckoning with racial injustice’ in the past three months was enthusiastically endorsed by major corporations, often even as their physical outlets were plundered by the ‘mostly peaceful’ activists on the street […] As capital aligns with the cultural left, it is now extracting its concessions.”

It wouldn’t be so unpalatable if it weren’t rife with hypocrisy. This, ultimately, is the cardinal sin of woke capital: lofty moral standards, selectively applied. In one of the earlier discussions of the woke capital phenomenon, which appeared in The New York Times back in 2018, columnist Ross Douthat pointed out the folly in Apple’s value statements: 

The Storyteller

About Peter C. Earle

Peter C. Earle is an economist and writer who joined AIER in 2018 and prior to that spent over 20 years as a trader and analyst in global financial markets on Wall Street. His research focuses on financial markets, monetary issues, and economic history. He has been quoted in the Wall Street Journal, Reuters, NPR, and in numerous other publications.

Articles by Peter C. Earle

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