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The Moralistic Corporation

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interview

The Moralistic Corporation

City Talk August 26, 2021
The Social Order
Economy, finance, and budgets

Vivek Ramaswamy is a biotech entrepreneur, founder, and executive chairman of Roviant Sciences, and author of Woke, Inc.: Inside Corporate America’s Social Justice Scam. He recently spoke with City Journal associate editor Daniel Kennelly about the origins of the corporate embrace of “social justice” and why he believes there’s no place for politics in business.

How do you define “wokeism” in the book?

Wokeism is a belief system which holds that the social universe is governed by invisible power structures based on genetically inherited characteristics. This belief system makes a moral claim on those “empowered” to wake up to these invisible power structures and to correct injustices arising from them.

Critics often allege that wokeism is a form of Marxism. They have a point, but they’re off the mark. Like wokeism, Marxism was also based on the idea of invisible power structures governing social relationships, but Marxism posits that these power structures are based on economic relationships. By contrast, wokeism replaces economic power structures with genetically inherited ones.

So that’s the long version. In short, being “woke” means obsessing over race, gender, and sexual orientation. Maybe climate change, too. That’s probably the best definition I can give.

When (and why) did corporations begin to adopt this quasi-religion?

The fountainhead was the 2008 financial crisis. After that, corporations were viewed as the “bad guys,” and the old Left wanted to redistribute money from corporate fat cats to poor people. Agree or not, that’s what the old Left had to say.

But a newly ascendant wing of the Left—the new woke Left—had a different theory. To them, the real problem wasn’t economic injustice. It wasn’t poverty. Rather, it was racial injustice—and misogyny, bigotry, and so on.

That presented the opportunity of a generation for Wall Street and big business. If you’re Wall Street, Occupy Wall Street is a tough pill to swallow. But the new woke demands were easy: applaud “diversity and inclusion,” put some token minorities on your boards, and muse about the racially disparate impact of climate change after flying on a private jet to Davos.

They jumped at the opportunity. But they didn’t do it for free: their implicit demand was that the new Left look the other way when it came to leaving their power intact. And it worked for both sides. So in a nutshell, after 2008, a bunch of big banks got in bed with a bunch of woke millennials. Together, they birthed woke capitalism. And they put Occupy Wall Street up for adoption.

Soon, Silicon Valley did the same thing—censoring or “moderating” content that the woke Left didn’t want to see on the Internet. But in return, they expected the woke Left to demur when it came to leaving their monopoly power intact. The rest of corporate America then followed suit.

What is “stakeholder capitalism,” and what role does it play in the corporate embrace of woke politics?

“Stakeholder capitalism” is the idea that corporations should not only serve their shareholders but also advance other social causes. It used to be a challenge to the system. Today, it is the system. Milton Friedman might have worried that the expansion of politics to infect business would make businesses less efficient. I share that concern, but my principal concern is the inverse: that the expansion of business into politics represents a threat to the integrity of American democracy itself. Why? Because it demands that a small group of business elites use their economic power to settle political and moral questions that ought to be settled through the open exchange of ideas in our democracy. That might be how Old World Europe worked, but America represents the rejection of that elitist worldview.

“Stakeholder capitalism” is the intellectual progenitor of corporate wokeism. It was the response to Occupy Wall Street and the old Left: instead of taking the risk that the old Left would defang capitalism through the political process, stakeholder capitalism and corporate wokeism offered to address the concerns of the new Left not as an alternative to capitalism, but through capitalism itself.

The consequences are staggering, and I think we are only beginning to understand some of them. For example, once a corporation becomes a vector for advancing a social agenda, progressives don’t have a monopoly on pulling the strings. Sovereign nations—China, above all—have learned that they, too, can wield power as a nebulous “stakeholder” of a business under the new “stakeholder-centric” model. That’s one of the untold stories that I lay out in the book, and the details are downright frightening.

You write that the corporate dedication to social-justice causes is, for some, cynical and opportunistic—a modern form of “capitalist excess.” Yet you also regard it as one of today’s “defining challenges.” How does it threaten American democracy?

The idea that a small group of elites should settle normative questions behind closed doors is a cultural rejection of democracy. Capitalism works according to a one-dollar, one-vote system. That determines which products get voted to the top of Amazon’s bestseller lists, or which directors are selected to serve on the board of a corporation—and that’s okay. But democracy is supposed to work on a one-person, one-vote system, where each person’s voice and vote is unadjusted by the number of dollars that he or she controls in the marketplace. Stakeholder capitalism violates that principle by conflating market power with power properly exercised in the marketplace of ideas.

And democracy loses in another way. We live in a divided polity right now, and we depend on an apolitical private sector to bridge those divisions—whether we’re Democrat or Republican, black or white. Major League Baseball used to provide one of those apolitical sanctuaries. The NFL used to provide one of those sanctuaries. The workplace used to provide one of those sanctuaries. But as the private sector becomes politicized, we lose the solidarity that is itself a precondition for a thriving democracy.

How can we roll back the tide of corporate wokeism?

There’s no silver bullet. The solution requires a combination of legal solutions, policy solutions, and—most important of all—cultural solutions. In my book, I discuss solutions in all three categories. I view legal and policy solutions as symptomatic therapies, but what we really need in our country is a cultural cure—a revival of a shared American identity that runs so deep that it dilutes wokeism to irrelevance. What does it mean to be an American in the year 2021? I can’t remember a time when we more badly needed an answer to that question. The absence of an answer is the black hole at the center of our nation’s soul, and when you have a void that runs that deep, that’s when bad things start to fill it.

Today, corporations prey on our hunger for purpose and our moral insecurities to make an extra buck, much as a Virginia Slims manufacturer may have preyed on the adolescent insecurities of teenage girls in the 1990s. Banning corporate behaviors isn’t the answer. The real solution is to fill our moral hunger with more substantial fare. That’s really what the book is about.

Photo: akinbostanci/iStock

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