Conservatives and Corporate Power

In 1994, David Frum laid out the clearest fusionist case for promoting corporate power:

If I am bearded, and I notice that my boss and the last four men in my section to win promotion are clean-shaven, I will find myself slowly nudged toward the barbershop. If the owner of the gas station across the road from mine smiles a lot, and I don’t, I will find myself forcing a cheerful manner myself, no matter how snarly I may inwardly feel. People who do not have to work for a living, however, can indulge themselves in a hundred little peculiarities of behavior – one reason that the English upper class is so famously odd. Millions of Americans now live as free from the pressure to conform as any English lord, thanks either to the direct receipt of welfare or to civil service employment where promotion is by seniority and firing is unheard of. The fact, as much as any fashion change, explains the sudden flaunting of ethnic difference in manner and dress that so distresses Patrick Buchanan in his native city. Relatively few vice presidents at Proctor & Gamble would dare wear a kente cloth or keffiyeh; nobody who intends to earn very much of a living in the polymer business can hope to get away with not learning English; but city hall employees and welfare mothers can do both.

He continues:

The great, overwhelming fact of a capitalist economy is risk. Everyone is at constant risk of the loss of his job, or of the destruction of his business by a competitor, or of the crash of his investment portfolio. Risk makes people circumspect. It disciplines them and teaches them self-control. Without a safety net, people won’t try to vault across the big top. Social security, student loans, and other government programs make it far less catastrophic than it used to be for middle-class people to dissolve their families. Without welfare and food stamps, poor people would cling harder to working-class respectability than they do not.

According to this view, libertarian economic policies like cutting taxes, cutting the welfare state, reducing unionization, and deregulating business will dramatically increase the power corporations have over our lives. And since corporations are led by socially and culturally conservative people, this will result in a more socially and culturally conservative society with much higher economic penalties for alternative lifestyles and personal presentations.

Frum’s conclusions about how corporations would wield their increased power may have been true when he wrote it, but his argument that the logic of the capitalist system would ensure that corporations always enforced social and cultural conservatism was clearly wrong. Corporations operating within budget constraints in competitive capitalism are required to do a variety of profit-seeking things to avoid bankruptcy or takeover, but enforcing any given social and cultural perspective is not one of them.

As Ross Douthat discusses in his latest NYT piece, conservatives nowadays are caught in the unexpected position of having the corporations turn on them, at least when it comes to social and cultural topics. This is naturally putting pressure on the old fusionist arrangement because big business is no longer upholding its end of the bargain. Inequality, precarity, and total dependence on the market no longer means a society where corporations force everyone to act conservatively or starve. Instead, it increasingly means a society where corporations are requiring people to act liberally (culturally and socially though not economically) to avoid economic sanction.

In his piece, Douthat says there are two responses conservatives could have to this new reality. The first is to hope right-wing billionaires retake control over the corporate sector, as with Elon Musk buying Twitter. The other is to use the state to inflict financial blows on corporations that assert themselves too much in the liberal cultural wars, as with DeSantis threatening to eliminate Disney’s special tax status.

But Douthat’s imagination on this is too limited, as are the imaginations of the conservatives he quotes in his piece. If you want to limit the power corporations have over everyone’s lives and the nation’s politics, then you need do the kinds of things that Frum was so against in 1994.

A slew of additional anti-discrimination protections could be added to the nation’s employment code that forbid employers from discriminating against employees due to their political views or activities. Unionization could provide additional protection against personnel decisions motivated in this way and also put in place less discretionary criteria for promotions, like the seniority provisions Frum so loathed.

The welfare state could be beefed up in various ways to lessen workers’ reliance on potentially discriminatory employers. Some conservative states actually did this in a very narrow way recently when they clarified their state UI rules to ensure that people fired for refusing to get a COVID vaccine would be eligible for unemployment benefits. In general, increasing the availability and generosity of unemployments benefits — and of course providing universal health care and family benefits — would somewhat lessen the kind of financial damage corporations can inflict on workers they dislike for cultural, social, or political reasons, as Frum argued.

Corporate funding of (especially state) parties and elections could be replaced with public funding, insulating lawmakers from the financial penalties that corporations usually threaten when they don’t like a particular law.

These kinds of moves would not solve all of your problems of course. Corporations can still throw their weight around by threatening capital strikes, as some have taken to doing in recent years in response to various conservative legislative efforts. So goes the hellscape of capitalism. But restricting their power in the employment relation and in the financing of politics should help some.

Of course, the reason conservatives balk at these much more obvious and well-established approaches is because ultimately they aren’t actually willing to do what it takes to reign in companies. The fusionist idea that libertarian economic governance promotes social conservatism was a decent way to get buy-in among some social conservatives to a libertarian project. But it is the libertarian project, a project motivated mostly by certain beliefs about the appropriate distribution of income, that predominates then and now.