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Sean Speer: After the Bud Light backlash, companies should consider being apolitical

Commentary

One of the biggest stories in the first half of 2023 has been the migration of cultural and political conflict to the corporate world. High-profile cases involving Bud Light, Disney and Target have dominated the news as the latest fronts in the growing politicization of virtually every facet of modern life.

What has made them so notable though isn’t that large companies have weighed into political matters—especially on the side of left-wing causes. As most conservatives will attest, that’s hardly a new development. But what’s different is that there’s been a semi-coordinated and sustained pushback in the form of boycotts and protests.

And it’s working. Bud-Light’s parent company, Anheuser-Busch, has lost more than $15 billion in its market valuation. Target’s share price has fallen by nearly one quarter since mid-May. Both companies have since abandoned the products or marketing campaigns that had precipitated the reaction. The market has seemingly spoken.

There’s been a lot of criticism of these so-called “anti-woke” campaigns. They’ve been characterized as bigoted, reactionary, and far right. As far as California governor Gavin Newsom is concerned, the companies sold out to a group of so-called “extremists.”

Although it’s quite possible that some involved in these campaigns are indeed motivated by objectionable views, the sheer numbers suggest that they cannot be dismissed as a fringe minority. Consider for instance that Bud Light has been supplanted as the top-selling beer in America for the first time in more than two decades. It’s hard to explain such a significant market change as merely the agitation of a small number of hardcore ideologues.

There have been some however who’ve argued that these consumer backlashes to corporate campaigns about identity, sexuality, and trans issues are an improper use of market power. They represent, according to this line of thinking, a “rearguard action…to block corporations from making their own decisions about how to adapt to social change.”

The problem with this argument is that it presumes that companies ought to be able to assume political positions free from any consequences. That they have no accountability to their customers, clients, or the market itself. They ought to be able to reap the upside of entering the political arena but ultimately be protected from the downside. Put more bluntly: these companies assumed that they could increasingly nod to left-wing political preferences on culture and identity and their more right-wing customers would simply acquiesce.

That’s of course not how business or politics or markets work. There are natural feedback mechanisms in a liberal, democratic, and capitalistic society. Customers can vote with their wallets. It’s arguably an even more powerful signal in the corporate world where majoritarian preferences aren’t constrained by constitutional protections for minorities. Companies must contend with the inherent tensions between liberalism, democracy, and market capitalism.

The recent string of high-profile cases suggest that major corporations have come to misread these potential trade-offs. They’ve taken for granted that their creeping politicalization is costless. The market’s definitive reaction in these cases should be viewed therefore as a useful corrective. Markets have done what markets invariably do.

They’ve reminded large companies like Bud Light and Target that their outright politicalization—particularly on contentious and unsettled matters—likely involves internalizing some costs. They can then better judge the actual consequences of their choices. The right response is to retrench from the excesses of what author and business consultant, Joseph Zamia-Lucia, calls “political capitalism.”

I interviewed him about some of these developments and how we ought to interpret them for an episode of Hub Dialogues in April 2022. I asked in particular about the feedback mechanism that would influence corporate decision-making about politics. He said:

“…whenever you take a political position, you will please some and infuriate others. When Nike took a position on Black Lives Matter, it garnered a lot of support from some people, and others were burning Nike shoes in the streets. Businesses have traditionally believed that they shouldn’t upset anybody. When you take political positions, you will inevitably upset some people….”

Markets are competitive things. The beauty about markets, if they are competitive, not monopolistic or oligopolistic, is that different corporations will take different positions that they believe in, or because they believe there are market opportunities. So, as long as we have sufficient diversity in the market, the likelihood is that different companies will take different positions.

Although he’s right that markets can act as important signals for firms judging the benefits and costs of adopting different political positions, Zamia-Lucia is wrong that the trend towards political capitalism is inexorable. There’s a counterintuitive case that the market reaction to these recent instances may actually cause firms to revert to a more apolitical position. That would be a positive development.

One of the great benefits of liberal democracy is to minimize the role of politics in our lives. It establishes democratic processes for selecting representatives and then delegates day-to-day governance to them. The rest of the constitutional model is about preserving space for people to live out their lives mostly free from political interference and even politics itself.

The places where politics pervade daily life, by contrast, tend to be totalitarian. Politics cannot be escaped there. They define how you live, what you say, and what you do. They’re totalizing.

The recent trend of politics manifesting itself in business, sports, and other non-political parts of modern life is unhealthy. It conflicts with the limited aspirations of liberal democracy and pushes us in a far worse direction. We should recommit to a more circumscribed vision of politics such that buying clothes or drinking beer isn’t an expression of one’s deepest political values.

If these recent cases help us to realize such a vision, the controversy and conflict will have ultimately been worth it. The market will have worked and our societies will be better for it.

Renze Nauta: Having a job can help ex-offenders set their life on a better path

Commentary

The last nine months have seen a depressing spate of news stories detailing horrific crimes on Canadian streets. Random stabbings on public transit partly defined the recent Toronto mayoralty byelection and spurred the federal government to introduce a bill to reform the bail system in Canada.

In the midst of this, it is more important than ever for governments and political parties of all stripes to offer a solution that goes beyond tougher bail and sentencing, as much as these policies may be called for under the circumstances. A governing agenda must also address what happens to ex-offenders after they leave prison.

A recent Cardus report investigates how and why crime and unemployment are related. There are a lot of different theories for why some people commit crimes and others don’t. Some researchers have even questioned whether there is much hope for offenders once they have settled into a pattern of crime. But our review of the empirical literature shows that, despite an early “consensus of doubt,” more recent findings have clearly shown that having a job can help ex-offenders set their life on a better path.

This shouldn’t be surprising to anyone. Work is about more than just money. It has all sorts of non-financial benefits, including better physical and mental health, greater life satisfaction, less family conflict and divorce, and lower instances of substance abuse. The inherent dignity of work can provide a greater sense of meaning and direction in a person’s life. That’s why Cardus argues for pro-employment policies for those with disabilities, the poor, and the disadvantaged. There is no reason to think it should be any different for ex-offenders.

As obvious as it might seem that there is a relationship between crime and unemployment, there are some important nuances that policymakers need to be aware of. For one thing, employment has a different effect on someone’s likelihood of committing a crime depending on how old they are. For most people, having a job is associated with avoidance of crime. But for adolescents, too many hours working at a job is actually associated with the opposite: teenagers who work more than 20 hours a week are actually more likely to commit crime than their peers who work less than that. Why? Because working that much might be a sign of a rough home life or a strained relationship with parents.

Herein lies a key message for those concerned about public safety: as important as employment is for reducing crime, it is even more important to have a strong and stable family life. Research shows that these family bonds are crucial for everyone in avoiding crime, but it is especially true for teens.

There is another side to the crime-unemployment relationship, too. Not only can unemployment lead people into committing crimes, but also committing crimes (and having a criminal record) can make it really difficult for people to rebuild their lives and find a job later on. This can lead them further into unemployment. It’s a vicious circle that we need to break.

The issue has several facets.

From an economic perspective, ex-offenders represent an untapped labour pool, which is no small thing in an economy short of workers. Studies show that employers tend to underestimate the value that ex-offenders can bring to a company. This is value that could be captured to improve the overall productivity of our labour force.

From a public safety perspective, we want fewer ex-offenders to become repeat offenders simply because we don’t want more crime. It’s neither realistic nor just to lock up all prisoners forever, and most people in prison today will walk free one day. Giving them the possibility of employment could mean that we have fewer victims of crime in the future.

But most fundamentally, from the perspective of human dignity, we owe it to ex-offenders themselves to ensure that they have a chance at having a job and rebuilding their lives. If we truly believe that all human beings have dignity and that that dignity encompasses our capacity for work, then any tough-on-crime, public safety, or social agenda should reflect this.