Don’t Confuse GOP’s Spat With Companies as Warfare

(Bloomberg Opinion) -- “Saying that I've thought about it doesn't mean that I'm doing it.” —  Alex Trebek

Corporate America and the Republican Party are at war. Supposedly.

To their credit, some members of the business community have come out against sedition and in favor of voting rights and thus tiptoed into the perilous world of “politics” — or, as we simpler folks call it, “democracy.” The GOP, turned off by all that wild behavior, is promising to punish the miscreants.

“From election law to environmentalism to radical social agendas to the Second Amendment, parts of the private sector keep dabbling in behaving like a woke parallel government,” Senate Minority Leader Mitch McConnell fumed Monday. “Corporations will invite serious consequences if they become a vehicle for far-left mobs to hijack our country from outside the constitutional order.”

Oooooh. “Serious consequences.” Scary.

When push comes to shove, though, what are both sides truly prepared to do?

Business leaders dizzied by unpredictable policy cartwheels but kept pliant by a giant corporate tax cut and targeted deregulation largely stayed on the sidelines during Donald Trump’s presidency. But the violent insurrection Trump incited at the Capitol on Jan. 6 brought some companies out of the woodwork. Dozens said they would stop making political contributions to 147 Republicans in the House and Senate who voted to overturn the results of the 2020 presidential election.

Corporate donations to political action committees run by Republicans also dropped in the wake of the insurrection. Yet some companies that promised to cut back their contributions, including AT&T Corp. and Intel Corp., actually kept their wallets open. At some point in the near future, we’ll know how long other corporations chose to rein in their giving.

McConnell threw down the gauntlet this week after Delta Air Lines Inc., Coca-Cola Co., United Parcel Service Inc., Home Depot Inc., Microsoft Corp., Bank of America Corp., Apple Inc., Merck & Co., JPMorgan Chase & Co. and a group of 72 Black business executives condemned Republican legislators’ efforts to restrict voting rights in Georgia. American Airlines Inc. and Dell Technologies Inc. spoke out against similar proposals in Texas. 

On Tuesday, Major League Baseball went even further by announcing it was shifting the location of its annual All-Star Game to Denver from Atlanta to protest Georgia’s restrictions. That’s a tangible move, with cultural and financial consequences for Republicans. It’s also a tactic that companies such as Delta, Coke, UPS and Home Depot — all of which are based in Atlanta — are unlikely to emulate. I don’t see any of them uprooting their headquarters and workforces to kick the GOP in the head.

That’s not to say that speaking up isn’t meaningful. All of these companies are setting boundaries around social and moral values that shouldn’t be partisan ping-pong balls. They’re also well aware of how some of their primary stakeholders feel about the GOP’s machinations. As Tony Fratto, a Republican strategist, tweeted this week: “Politicians can hate it, but companies are going to reflect their employees, investors, and customers. It’s not even a choice. And companies know their employees, investors, and customers better than politicians.”

In the same vein, the decision by JPMorgan’s chief executive officer, Jamie Dimon, to publish a lengthy and thoughtful annual letter to shareholders that, among other things, called on companies to be “responsible community citizens” is laudable and exemplary.

But in the end, lofty corporate statements of purpose and verbal condemnations are unlikely to matter much to the GOP given the party’s configuration. On the other hand, the GOP can’t really do very much to punch back other than jawbone.

When McConnell warns of serious consequences, what does he mean? Republicans could try passing federal regulations that Big Business abhors but 1) That’s not how they roll and 2) They don’t control the federal regulatory apparatus right now, Democrats do.

Republicans will continue to invoke so-called cancel culture to try shaming the business community and score points with their political base, but so what? Commerce will plow ahead.

The only meaningful break, and one that is likely to have consequences down the road, may be around money. Some Republicans clearly don’t feel intimidated by corporate cutbacks on political contributions because small-dollar donations from individuals have, perhaps temporarily, filled the gap. That cash flow may be disrupted by recent disclosures in the New York Times that Trump and the GOP have been trying to fleece individual donors, but for now a fresh source of funding has given Republicans some attitude.

McConnell can make all of the empty threats he wants to, and corporate America can —  and should — continue trying to take the high road, but I imagine much of this won’t amount to authentic, no-holds-barred warfare. It’s more like a lovers’ quarrel.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Timothy L. O'Brien is a senior columnist for Bloomberg Opinion.

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