American business used to be a common partner of Republicans. But the party claims that corporations have now gone “woke”, endorsing progressive values. Are companies really moving leftward? Eitan Hersh finds that business leaders perceive their companies moving toward Democratic elites and policy priorities, mostly due to internal demands. Soubhik Barari finds that companies are moving leftward in their social media posts and that public messaging is indicative of their internal behavior. They both say the woke capitalism narrative may be incomplete, but commentators are reacting to real change.
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Matt Grossman: Has American business turned left? This week on The Science of Politics. For the Niskanen Center, I am Matt Grossman. American Business used to be a common partner of Republicans advancing lower taxes and regulation, but recent years have witnessed claims that corporations have gone woke as they increasingly endorse progressive values like diversity and sustainability. Are companies really moving leftward, and if so, are they following consumers or employees?
This week I talked to Eitan Hersh at Tufts University about his new paper with Sarang Shah, the Partisan Realignment of American Business. He finds that business leaders perceive their companies as moving leftward, mostly due to internal demands. They even increasingly share Democratic policy priorities. I also talked to Soubhik Barari of Harvard University about his new paper, Political Speech from Corporations Is Sparse, Only Recently Liberal and Moderately Representative. He finds that companies are moving leftward in their social media posts, but it’s not all for show. Their public messaging is somewhat indicative of their internal behavior. They both say the woke capitalism narrative may be incomplete, but commentators are reacting to real change. Let’s start with my interview with Hersh.
So you have been evaluating this common claim that business has been moving away from the Republican Party and toward the Democratic Party. Is that true, and what are the biggest takeaways from your analysis so far?
Eitan Hersh: Sure. So I think it’s a contested claim. Everyone, I think, or not everyone, but a lot of people sense there’s this realignment happening maybe at the mass level, maybe at the elite level. The Republican Party is becoming a more concentrated group of non-college-educated Americans, and the college-educated workforce is becoming more on the Democratic side. And business, particularly big businesses that are staffed and run by college-educated folks, we see news every day that they’re under pressure to take positions on liberal issues or manage stakeholders like employees or customers or activist board members who want to push the company one way or another.
And we see a lot of the activism mostly on the left, that is it feels a long time ago now that when we thought about business leaders, we thought about oil companies or the Koch brothers. If we look at CEO activism over the last decade, it’s overwhelmingly on left-leaning issues, the public stuff. So the question is, how do you know whether a company or a set of companies or business elites, in general, are moving one way or the other? And that’s what our paper is trying to weigh in on.
Matt Grossman: So you do this by taking surveys of American business elites. So how do you define and reach them, and how does your strategy differ from some of the other ones that we’ve seen?
Eitan Hersh: Sure. So just for everyone, it’s probably obvious if you’re in the research world that if you want to survey the mass public, a representative sample of the mass public, that’s pretty straightforward. We know how to do it. It’s not easy because people don’t respond to solicitations anymore, but we roughly know how to do it because we know what the population looks like. Studying elites of all kinds is really hard. I think the most common ways to study business elites or wealthy people in American politics tends to be through campaign finance data.
So I did a survey a while ago with Brian Schaffner, where we surveyed high-dollar donors to political campaigns. And you have a population of high-dollar donors, and you survey them. Other people, including you have used PAC data, there’s a lot of hard data to use. The problem with all of those forms of data is that there’s real limitations, just like with anything. So when we think of donors, for example, who are associated with businesses, we see donor behavior, like rich people who are work for a company, and it seems pretty clear from the data that they are giving donations to political candidates really more based on their own ideological worldview than as a representative of their company.
So you can see that in the fact that almost no one donates to both parties, even among rich business elites. So you get the sense that that’s not necessarily going to give us a sense of where a business is. Our approach was to try to use a creative set of tools that I’ve done in various versions before by using voter file data to target people who are likely to be business elites. So that is, I went to a national voter file vendor. I looked at rich people in rich neighborhoods of working age who are not physicians or hold other licenses that might suggest they’re not business leaders, and I surveyed them. It is a sample that, like any sample, has some advantages and disadvantages over other methods, and we can talk about those if you want.
Matt Grossman: I guess I’ll just ask directly then. So how do we know that these are actually business people or business elites or representatives of the places that they work for?
Eitan Hersh: Sure. So what we know from the people who responded to the survey is that they are overwhelmingly people who fit the characteristics of what we think of as business elites, that is the most common person we interviewed is a COO, a C-suite person. I think 10% or 15% of the sample are CEOs and presidents of companies. They are vice-presidents. They’re nearly all in management roles. They are nearly all very wealthy, and they work for a wide range of industries. And so there’s a whole bunch of people who we know are excluded from this method. And that is, we did not interview people who did not live in single-family homes in very wealthy neighborhoods. And there’s a whole bunch of states that actually don’t even have neighborhoods like that.
So there’s a business elite in Mississippi, for example, that are not in our survey because there are no block groups, census block groups in Mississippi that is concentrated among wealthy people. So it’s very hard using this method to pinpoint, well, who is likely to be a well-to-do business elite in Mississippi. So our survey sample is concentrated on about half of the states where there are these pockets of rich neighborhoods where you have this kind of elite. Now we have Republicans and Democrats in the sample. We know the population of the sampling frame, that is we know how many people are like the people we sampled. That is they live in single-family houses in rich neighborhoods that are of working age between 35 and 65. They don’t have medical licenses. So we know our sample, as it relates to that sampling framework, what we don’t know is well, how many small business owners in Alabama, Mississippi, or places like that are not in our sample, and how do they differ from the ones who are?
Matt Grossman: So you also have a companion survey of the American public, so you’re able to compare how the public as a whole versus business leaders specifically think about these things. And one of the first questions you introduce is just asking them, are businesses moving leftward? And it looks like the business leaders are more convinced of that than the public. What should we make of that?
Eitan Hersh: So this is fascinating because if you ask Democrats or Independents in the mass public, are businesses moving to the left or to the right, they say, “No, they’re not moving really anywhere.” But if you ask Republicans in the mass public, they say, “Yeah, the business community, businesses across the country are moving to the Democratic side.” Only Republicans in the electorate say that. And you might think they say that because some of them are getting messages from news media that there’s this new woke capitalism that’s taken over. And if you’re an observer looking at that, you might think, oh, are they misperceiving reality? Because they’re living in some media bubble, that is the Republicans and the electorate, they’re perceiving something that no one else is perceiving?
And then you ask the same question to the business leaders. And what you see is that they all, that is no matter whether they’re Democrats, Republicans or Independents, all the business leaders in our sample tend to think that yes, their company is moving to the left, national companies are moving to the left, companies in their state are moving to the left. There’s no partisan difference. So that’s an important comparison, because what it shows is that there’s disagreement in the electorate, and that disagreement, I think, is resolved a bit by asking business elites themselves. And they say, “Yeah, the companies are moving to the left.”
Matt Grossman: So you also try to take apart the company and look at different stakeholders that the company might be responding to. And one of the clearest patterns I saw was that a lot of people see employees as being more Democratic, but they see customers as more Republican. That might be responsive to the public debate we’re having about whether these companies are responding to consumers or just internal demands. And does it look like yes, the internal demand story is right?
Eitan Hersh: Yeah, I think the data is consistent with that. The people who are the stakeholders outside of the customers, if you’re of a big company that mostly hires a college-educated workforce, your employees are overwhelmingly Democratic, and the management might be overwhelmingly Democratic. And what we see is when you ask business leaders, “Where do the various stakeholders lean?” they say, “Yeah, the CEOs tend to be Democratic, and the employees tend to be Democratic.” But they don’t say that about the customers, which makes sense, because the customers are Americans mostly, and they’re across the board. So I think you do see evidence to suggesting that the internal stakeholders of the company are the ones who tend to be leaning left and pushing left.
Matt Grossman: So you also asked them about recent movement over the last 10 years, and there you saw more across the board leftward pressure across stakeholders, that more of the stakeholders were moving left and pressuring the company to move left. So why do you think that is that people see executives and board members, for example, as moving leftward, but don’t quite see them as associated with the Democratic Party yet?
Eitan Hersh: That’s exactly right. So just to clarify it. So when you ask executives, these business leaders, “Where does your company stand?” there tend to be all sorts of disagreement, that is the Democratic people, that is the business leaders who identify as Democrats tend to say that their companies are more on the left side. Republicans tend to say they’re more on the right side. But then if you ask, “In the last 10 years, has your company moved to towards Democrats or towards Republicans?” everyone, Democrats, Republicans, Independents, they say that the company has move left, the CEO has moved left, the employees have moved left, the board has moved left. There is no partisan disagreement.
That, by the way, is helpful for us in a methodological way, which is that, getting back to the sampling issues, even if because of our sample, how it’s structured maybe has more Democrats in the business elites than Republicans, because it over-samples people in wealthy states, which tend to be more Democrats, even if that’s not reflective of all business leaders across the country, the fact that there’s no partisan difference in how the business leaders are answering this question is meaningful because it basically says, “Whether you’re a Democratic business leader or Republican business leader, you see your company, on average, moving to the Democratic side.”
Matt Grossman: Now, why exactly is that happening?
Eitan Hersh: I think this is consistent with the broader narrative of realignment that’s happening, which is that these constituencies of big rich companies, they’re not like the golf club Romney Republicans anymore. On social issues, they’re pretty left. They see probably the Republican Party becoming more of a populist party, anti-trade, anti-immigration, in some ways in the tech sector just overtly anti-big business. So it’s not totally shocking that many of these stakeholders see themselves as more aligned with Democrats at this point.
Matt Grossman: And so we’re asking for this retrospective evaluation, but you just mentioned that they might be responding to Trump-ist changes within the Republican Party. And I misstated it. I said they’re moving left, but you actually asked about the parties. So if you had taken the survey 10 years ago, do you think it would reflect this kind of change, where people would now see these groups as closer to the Democrats? Or is this a reaction to what’s happened over the last 10 years?
Eitan Hersh: So it’s a great question. I think it’s useful to separate the things out that predate Trump. A lot of the groundwork for this potential realignment predates Trump, the trade policy, the immigration policy, to some extent foreign policy. There’s been increased demand for a populist party. So if you asked this question 10 years ago, I don’t think you would see the business leaders saying that they’re moving left. I’ve interviewed dozens of business leaders now in one-on-one interviews, and you have this sense that from these interviews, which are extraordinarily helpful and this is fascinating to talk to people all over the country in different kinds of businesses, one business leader gave me the analogy that he’s on a shrinking island.
He’s never been at home with the left. The left is not their people. And it’s just that now they have many fewer allies on the right, and so they feel politically homeless. So I think that probably, again, there’s great research articles about this before Trump was even in the picture. Obviously Trump I think moved it along more. But I can’t imagine asking these questions in the Obama years and hearing a lot of stories about business people being like, “Yeah, we’re now clearly on the Democratic side.”
Matt Grossman: So you also asked about policy priorities of the companies. And to be honest here, I was a little skeptical, because you end up finding more people, for example, say that their company is prioritizing diversity, equity and inclusion than say that their company is prioritizing regulation in terms of their policy issues. So does this signal real changes in what companies are interested in politically? Is this just people picking an issue affiliated with the side that they’ve said the companies are on? Or is this also a sign that maybe the people you interviewed aren’t actually the ones making the PAC donations or the company political activity where it still does seem like there’s a little bit more activity on these traditional economic issues?
Eitan Hersh: Sure. So let me back up a little bit and just articulate a bit more about the theoretical anchors of this paper. So what we’re really interested here is in cross pressure, whereas if you’re a company, do you see your CEO or your board being politically neutral or Republican, but employees pushing you to the left? How is that cross pressure resolved? In policy there is a different cross pressure, which is that clearly companies have different policy issues that might cut different ways, where they might have a regulatory preference that’s consistent with the Republicans, they might have a culture in their company that’s consistent with the Democrats, and we’re interested in that.
So you’re right, about half of the business leaders say that their chief policy for their company is either regulatory or something economic, like inflation, stuff like that, taxes, whatever. And then half point to other stuff, all other stuff. So healthcare is a big one. Education’s a big one. DEI and environment is a big one. So one reading of that, which you didn’t say exactly, but I think I’m implicitly reading into your question, but we can debate about it, is if you say your company’s highest priority is healthcare or the environment or DEI, are you some joker? There’s no way. But I actually think there’s increasing evidence that that’s not true.
Obviously healthcare is a major expense of companies, and there’s a lot of companies that can legitimately claim the healthcare costs are out of control, and it’s bad for our company. There’s a lot of companies that don’t have to care about DEI, diversity, equity, and inclusion, in any moral way, but their attorneys, their general counsels are telling them, “You better prioritize this, and we’re going to have weekly company meetings about it, and we’re going to have a whole new vice-president that’s about this. And by the way, it’s a serious workforce issue. It’s not just that we care about it for fun, our employees will be very mad at us. We won’t be able to hire people if you’re not articulating a certain view about this.” That’s not a symbolic issue anymore if it’s a workforce issue or a legal issue.
So I don’t think we’re surveying the wrong people because, again, the one-on-one interviews of this are reflective of a sense among many business leaders that truly their company’s biggest priorities are these things that are aligned with the left. And I think one fascinating thing which we talk about in the paper a bit is that if a company is culturally tied to the left or culturally targeted to the right, it could be very challenging for them to cross sides. So you can imagine a company easily, or a university for that matter, that even if it had a regulatory preference that the Republicans liked more than the Democrats, the company would pay a serious cost for playing nice with the Republicans.
And I think you can see this increasingly, CEOs saying, “You know what? I would like to donate to a Republican, but this Republican voted against the election certification, has said a bunch of stuff, that if I associate my company in any way with this candidate, this is a major threat to our business.” I think there is increasingly litmus tests around that that I think can make a reasonable person, even in a position of authority in a company like A CEO or a COO or certainly a Chief Counsel say, “Yeah, our biggest priorities are stuff that’s aligned with Democrats.”
Matt Grossman: So let’s go back to the measurement strategy a little bit because it does have to do with this. So we do have this, I guess, longer term association where the association between income and Republican voting has historically been stronger in red states than blue states. You’re interviewing a lot of rich people in rich areas of blue states. These have been places that have been moving Democratic, even in voting patterns. So one story might be it’s not that you’re telling us about something that isn’t happening. It’s just you’ve interviewed people in the places where it’s happening the most. What do you think about that?
Eitan Hersh: I think we’re interviewing people in the places where there’s the most robust economic activity. And we have a lot of Republicans in the sample. I’ve interviewed a lot of the Republicans as well. But a third of the people in our sample work for companies with fewer than 100 employees. Another third work for ones with more than 10,000 employees. And the middle third is between between 100 and 10,000 employees. So most people in the country don’t work for huge companies. And even the rich people in the rich neighborhoods in our sample, which does over-index on California, Texas, New York, a third of them are working for small companies. So I don’t think we’re just looking at people who work for Google and Apple, that’s not the story.
And by the way, the research methods that focus on big donors or any donors, donors over $200, is missing the vast majority of rich business people or any business people. And same with PAC stuff. So I think all research methods that target elites like this are in the same boat where we know we’re missing a huge part of the equation. That said, because that sounds overly defensive, but it’s true. It’s true. You can say, “I’m studying all donors.” And someone would be like, “Yeah, but most people aren’t donors. So get out of here.” You could say that about basically all these research methods.
But there’s something else to say, which is that, and I wrote a piece in The Atlantic about this, which you might want to say too actually about workplace politics. When you talk to people who are in retail, these are rich business people, but they have a chain of retail shops, or they make frozen food that goes to supermarkets or whatever. And they don’t have a college educated workforce, they have a non-college educated workforce. You get wildly different answers, and the answers are basically, “No one in my company gives a crap about politics. It never comes up. Our employees are never talking. There’s no trainings, there’s no workshops, there’s no signaling that we are a left wing or a right wing company. There’s none of that.”
So I do think you see that. And it’s funny, I was talking to some students at Tufts about this paper yesterday, and we were talking about whether companies just see a lot of the progressive stuff as just being more overt. For pride month, there’s decorations all over the office. And they said, “That gives you a Democratic sense.” And I said, “So what would overt conservatism at a company culturally look like?” So we tried to think of Conservatism at a company culturally looked like. And so we tried to think of examples. I said, “Okay, there’s a lot of decorations for Pride Month, like our Christmas decorations.” I mean if you say… We’re not having a holiday party. If you say, “Our company has a Christmas party,” does that track Republican? And so the ones that we came up with as students, this is sort of a sidetrack, but I find it interesting. We went through a lot of, how would Republican company show itself? And one of the students said, “If they said they were celebrating Columbus Day,” was one.
And I said, “What about just American flags or Support Our Troops?” They said, “No,” but so if you say, “We support our police,” that would track Republicans to them. So it’s funny, they can think of a lot of things that companies do that seem to suggest a Democratic alignment, but they couldn’t think of too many that track Republican. And what I would say, just coming back to the sample, is I think a lot of the smaller businesses that are in the sample, they seem like they don’t want to be political at all, that they’re neutral. And by the way, these small businesses, they might be members of the Chamber of Commerce or this or that, but they’re not particularly animated politically. Sorry, there’s a lot there.
Matt Grossman: No problem. So the other paper paired with this one gets at some of these because it looks at corporate political speech on social media and then tries to relate that to other kinds of indicators like PAC spending by those same companies and indicators that might be about employee or consumer politics. And what it finds, which won’t surprise you, is that recently corporate political speech has been more likely to mirror Democratic members of Congress speech than Republican members of Congress speech. Though it’s pretty sparse overall. Most social media discussion isn’t politics.
And it does relate to all of these other indicators, so the companies that are most lefty on their social media are also the most lefty in other activities. So all of that matches, but there still is a gulf between the how Democratic are they in public and how Democratic are they in things like PAC spending or private political behavior. So how would you, I guess, fit those kinds of findings with your story?
Eitan Hersh: Yeah, it’s a good question. Again, I go back to this story that is told about the healthcare debate in the 1990s where you had a bunch of companies that, either for moral reasons or probably for bottom line reasons, wanted to get into healthcare reform and work with Democrats, work with the Clinton administration to do that. And the story is that they were reverse lobbied, that Republican members of Congress said, “If you go work with Democrats on healthcare, never come talk to us again.” And the businesses felt that they were fully in the Republican coalition such that even just negotiating with Democrats on this one policy area posed a threat to their coalition.
I think that we are in a situation, and I don’t know how long it’s going to be, but I think it is actually probably durable given the stakeholder’s perspectives, that companies will increasingly feel like they have to navigate… Some companies, companies with Democratic stakeholders, the kinds of companies that do a lot of Democratic-aligned messaging and all that, they’re going to see that they’re going to pay a cost if they start giving publicly tracked PAC donations to Republicans who… Not just Republicans, but most Republicans are perceived by Democratic activists as basically extremists.
And so the companies are going to pay costs. So is that stuff going to peter out? I don’t know. One possibility is one suggested by Paul Pearson and Jake Grombach, which is that they’re just going to increasingly give through undisclosed ways to advance their interests by using essentially dark money groups or chambers or things like that.
Another possibility suggested by a quote in our paper to Tom Edsall is that Democrats are just going to get better from the perspective of the companies on the regulatory policies so that this won’t be something that divides Democrats and Republicans. And I mean, I think you already see this in the mass public, that is, the appetite for corporate engagement on political issues on the left has just grown at an unbelievable rate. When you ask people on surveys, “Do you think companies should take stances on politics?” Democrats are like, “Hell yeah,” and that’s new.
It’s funny, now that I’m getting old. I taught Citizens United in my elections class when I started teaching. I’ve always taught. It’s a core part of my class on elections. And just watching students over time shift is amazing. That is 10 years ago, 12 years ago, whenever I started teaching, we talk about Citizens United and the idea of corporate free speech was something that the students, who tend to be on the left, really rejected. And now they see so many examples of companies coming to the defense of their position on social issues that they’re like, “Yeah, of course it’s important.” That’s a major change, and when you see that change, I think you do sense that the relationship between companies and the parties are really changing.
So again, the data doesn’t suggest that there’s a whole bunch of companies that are super left in public and then super right in private. But there do seem to be at least some companies where, for example, their public political statements are aligned more with the left and then maybe their actual lobbying behavior is more on the tax bill or their campaign contributions are aligned somewhat with their regulatory strategy.
Matt Grossman: So if that’s true of some companies, how would that show up in your data? And then how should we think about that? Is one of those the true politics of the company? Are they both the true politics of the company? And is it possible that your respondents are, like your students said, more responding to what they see in public and in public relations and less in behind the scenes politics?
Eitan Hersh: Yeah, so I do want to say our sample is mostly very high up people in companies. I don’t think there’s any reason for them to not be reflecting the reality. It’s useful to think about what that cross pressure looks like. I mean, you can imagine a company that installs solar panels and the company is Republican in culture because its staff is Republican. The installers are all conservative. And if you ask them what the company culture, they might say neutral or conservative because the people who work there conservative. And you say, “Okay, on the issue that your company cares most about, are you aligned with Democrats or Republicans?” Say, “Well Democrats because we install solar panels and Democrats seem to solar panels.” You would see that as a cross-pressured company. And you can see many cases in the opposite where a company is Democratic in culture, but on some tax or regulatory policy, they’re more Democratic. So I think you could see banks as like this.
Now, I think you’ll talk to bankers who have no problem saying that, yeah, the people who work for them are sort of center-left, but Dodd-Frank was the most evil thing that’s ever happened to them. And I don’t think they have any problem sitting in that space. But I think what our evidence is showing is that those situations are relatively rare. So it is much more common for the Republicanly aligned company to also feel like it’s policy preferences are Republican Democratic ones.
I think that I’m convincing myself over time that the lefty stuff that companies are doing is not just symbolic. I think a lot of it is symbolic, but I think when you see what happened to a company like Disney, I see the Disney story as one where the company had no choice. It has a really liberal and disproportionately gay workforce, and something came up that was not just a symbolic policy issue but was truly a workforce issue. And the company doesn’t have to want to take a position, but its workforce felt threatened and part of its business model was threatened, so it had to do something.
And so you had a situation prior to the Disney flare up where you had the company having lots of lobbyists in Tallahassee playing nice with Democrats and Republicans, including Republicans who are saying pretty nasty things about LGBT Americans. And the company’s like, “Well, for our purposes here, playing nice is the right strategy.” And then I think when the bill was before the State House and before the governor and Disney finally weighed in, my telling of this story is that they just misunderstood that the gay rights issues were not a symbolic gesture, but they’re actually a serious workforce issue for them. And so I guess what I’m trying to say is that it’s possible that issues that 10 years ago were symbolic, the companies have a stronger stake in them.
Matt Grossman: So you begin the paper with a assumption widely held, but I want to push back a little bit on the idea that business used to be a key constituency of the Republican Party. Now I think there’s pretty good long-running evidence that small business people and small business associations have been a Republican constituency. But when we come to larger businesses I guess, was that ever the case?
So just some counter examples. In some issues that they looked at in the biggest study of lobbying I think, business was on both sides and every single one of them. Individual studies of business lobbying almost always find that there are some issues on which the company sides with Democrats and some issues on which they side with Republicans. So I guess, did we overstate the Republican-ness of business in the before times?
Eitan Hersh: Sure. That’s a great question. So I deal with a lot of this history in this Annual Review of Political science piece I wrote. I think it came officially this year. It’s called the Political Role of Business Leaders. And I tell two versions of this historical narrative. The one that I think is most common among political scientists and honestly among the general public as well, is a story that goes something like this.
In the 1950s in the post-war era, business and everyone was sort of wishy-washy, nonpartisan, and they were very civically engaged and business was super involved at the local and regional level as well as the national level and played nicer to both sides. But a variety of things happened in the 1970s that changed all that, and the things that happened were basically business started feeling competition from other countries, which hadn’t happened during the immediate post-war era. Pro-regulation groups started pushing Democrats to vastly increase the regulatory state. A whole bunch of stuff happened that business gets organized and it becomes fully associated with the right.
And you see this if you read Hacker and Pierson, Bartels, Page, scholars like that, I don’t think I’m misreporting here, I think they’re telling a story that starting in the 1970s, the business community became essentially this stakeholder for the Republican Party. The nationalization of politics started happening as well, and so you have businesses not playing the same kind of civic role at the regional local level that they had, which was, I would say, more non-partisan or bipartisan. But due to companies becoming public, becoming multinational conglomerates, you don’t have the same story of regional elites as kingmakers in regions. So you have a national story and a partisan story emerging.
Now, I think you’re right that that’s a story that hides a lot of details and the details are that obviously if Democrats are in power, which of course Democrats were in power in the House of Representatives for this huge period of time until 1994, of course the companies were also playing nice with Democrats. But I think that the scholarship… And you can tell me if you’re wrong if I’m wrong about this. I think if you were to poll political scientists or the mass public during these periods and after, they would say that it’s business on one side and unions on the other, and the businesses Republicans and the unions are the Democrats. And I don’t think that becomes fully complicated until very recently. But do you think that’s wrong? Come on. [inaudible 00:39:30]
I think it was never true that business was analogous to union’s role in Democratic Party politics. So I don’t buy that story, but it certainly is true. I mean, we have data that looks at business positioning versus party positioning on as all of the bills in the Gillens data set and overwhelmingly they side with Republicans and when they don’t it’s usually… Almost everybody is kind of on one side. So yeah, I would just add that complexity. But I do think it matters for how you think about what does it mean to become a constituency member in this story about if business becomes a constituency of the Democrats, does that mean they’re going to push the Democrats to the right on economic issues? That kind of thing.
Matt Grossman: So one story that you said Tom Edsall and maybe you are subscribing to is that this brings some potential to move the Democrats rightward on economic issues. So walk me through how that might happen, and I guess one alternative would just be to say maybe we’re just seeing the continued rise of cultural issues relative to economic issues among… If even among business cultural issues are now dominant, that might suggest that economic issues are just declining in salience relative to cultural issues rather than that they’re changing positions.
Eitan Hersh: Yeah, I think that’s true for the Democratic public. I do think we’re having a realignment. I mean, you have Tucker Carlson saying we can never let automation come after the trucking industry because truckers are one of the best paying jobs for non-college educated men.
And it’s funny, I teach a class on political conservatism and I show a Tucker Carlson monologue and I ask the students to tell me what about this monologue is left and what about it is right? And the monologue I show them is a 50 minute monologue that almost word for word could be said by Bernie Sanders. It’s a populist appeal that’s mostly anti-corporate and that the companies, the big companies do not care about the little man. It’s really indistinguishable from the Bernie Sanders wing of the party. Obviously, just to be clear, not everything Tucker Carlson says is consistent with what Bernie Sanders says, but on this 50-minute monologue, it’s consistent.
And clearly there is a wing of the Democratic Party, the Elizabeth Warren wing, the Bernie Sanders wing, they care about economic populism, they’re anti-business. In my interviews, I interviewed a fairly prominent business person, a very well-to-do person who’s on the left, and very clearly on the left. And he had no problem telling me in an interview how much he hates Elizabeth Warren. I mean, just, “She’s the devil. She’s the worst,” and he’s on the left. I think there’s a struggle here, but it seems to me as the Democratic Party becomes a more concentrated group of college-educated people, they are going to push aside the demands of labor or the anti-capitalist vibes that are popular on the far left. I see that as a tension, just as it’s a tension on the Republican side. I mean, I think there is a clearly a populist swing of the Republican Party that’s a tension with the elite wing.
The union piece is kind of interesting because the dominant unions seem to be the public sector unions that don’t have the same relationship to business. The business people don’t have to think about public sector unions in the same way they have to think about private sector ones. And those seem to be the loudest voices on the labor side of the left. And by the way, sorry, not to go on a rant, but it is so funny how much of the union organizing that we’ve seen recently has been grad PhD students, and you see labor unions being like, “Here we got another set of PhD students unionized.” Like, okay, that’s a changing market.
Matt Grossman: So you mentioned that your students have perhaps self-servingly changed their opinion on whether companies should be involved in politics when they’re seeing these kind of public stands that they take, but how should we think about that? Should we want companies to be involved in politics and should we want individuals to take their company interests into consideration in determining their own politics?
Eitan Hersh: I will say my view, but it’s not from the paper and I do not speak from my wonderful co-author, Sarang Shah, who might have a different view than I have on this. Maybe he doesn’t, I don’t know. But let me start with some data, which is that the public trusts business leaders a lot more than they trust many other elites in politics, more than politicians by a lot. I think even more than religious leaders. People think their company’s leadership should be involved in conversations of economic issues.
I think there is a view on the far left that basically corporate executives should not be talking to lawmakers, but lawmakers are trying to regulate the economy and they really do want talk to executives and the public wants them to because they know that their jobs are on the line. And so I think it’s really important for companies to be involved in politics because they need to articulate how regulation and economic development and all that stuff affects them because the employees are voters and the politicians care about the voters. And they know that business leaders in a capitalist system have a lot of insights to how politics is going to affect the business.
I think it’s true too with cultural issues. I bring up all these examples when I teach Citizens United about companies taking stances in politics. I talk about how Tic-Tac, the company, Tic-Tac, got involved in politics in a very mild way because there was a video that came out of Trump saying before he molests women, he used a Tic-Tac. And then Tic-Tac sent a tweet saying that, “This doesn’t reflect our corporate values,” or something like that. And so I put that to students. Here’s Tic-Tac, they are paying a social media person. They’re using their financial resources to pay a social media person to weigh in on politics because politics came to them.
And do I think that because they’re a company they shouldn’t be able to say, “Oh, this is a terrible thing that someone used Tic-Tacs in this way”? Yeah, I think that’s totally fair. We bring these examples of a airline company or a hotel companies that do have large gay workforces weighing in on cake bills and bathroom bills and all this stuff and saying, “Hey, we’re part of the economy too. We have a lot of employees who care about this. Voters, don’t go along with politicians who are going to do stuff that’s going to make it harder for us to do business here.”
And by the way, I’m choosing left-wing examples for my students sometimes because I know that those resonate. But it’s the same thing on the right. I mean, if a company says, “Hey voters, you think that…” I mean, here in Massachusetts we now have a is tax surcharge. And company leaders are saying, “Hey, it’s not just us rich people who get taxed by this. If our business leaves the state, that’s really bad for the state.” And I think we just had a Celtics member who left for a different team in part, I guess, because once he calculated the 5% tax surcharge, it was like, put him over the edge. That’s a totally reasonable position to articulate and I think it absolutely makes sense for a company to be able to tell voters that because how else are the voters going to find out?
And so I don’t know. I think that… I mean, my personal view is that Citizens United was rightly decided and companies both should be able to make speech because they do represent voices that people care about, and also for reasons that are unrelated to this conversation, which is it’s very hard now to understand what a media company is and deserves press rights versus not a media company. But you know, you have to take US Elections PS112 to get the whole thing.
Matt Grossman: So where is this going from here? You mentioned you’re doing a lot of interviews, you have these survey data. What’s the long-term plan here?
Eitan Hersh: Sure. Sarong and I have one other paper in the works that’s really focused on not partisanship, but in forms of engagement and topics of engagement. That is, on what topics and in what ways do business leaders think their companies should be involved in politics and what does the public think?
And just to preview those results, business people are very comfortable with their company not just engaging on regulatory issues, but on economic issues, environment, on many issues. Not all. No one wants their company involved in election democracy stuff, but they do want their company involved in economic development. Democrats, in the elites and in the mass public, are always, in our survey, more likely to want their company to engage, including on just the tax and regulatory stuff. That is, the Democratic business elites are much more in favor than the Republican ones.
But, and here’s the interesting thing, there is a widespread hatred of public forms of engagement. We asked, do you think your company should do that stuff that’s customer-facing? No. Get your employees involved in stuff? No. How should a company be involved according to these executives? Through industry groups, through CEOs quietly talking to politicians, in the quiet, traditional ways. And that jives with what I’ve learned in the interviews too, that yeah, a lot of people think their company should… Sometimes because of economic development, sometimes because they’re worried about threats to democracy, they want their company involved, but mostly in very quiet ways. That is interesting for a researcher because the ways that they want are going to be hard for us to track.
So Sarong and I are going to write two papers and then the interviews are going to be coming with data and with some other data and some historical stuff I’m collecting and we’ll probably turn it into a book about what exactly is the role of a business person in American democracy? What does the public want from them? What can they bring to the table that they’re not bringing now? And how should we think about that oftentimes uncomfortable relationship between capital and democracy?
Matt Grossman: While Hirsch has been hearing directly from business leaders about their perceptions, Barari has been investigating what they say and do directly, starting with their social media posts.
So you study posts on Twitter and Instagram, and give us a sense of what each one of those might look like on those platforms, whether there were any differences between the two platforms, and just how you think about the social media feed, given that you’ve selected these two very different platforms.
Soubhik Barari: So I look at both Twitter and Instagram in order to be able to compare messaging across these two somewhat different platforms. So Instagram users, according to what we know, tend to trend younger than Twitter users. And so this is important because you might think that companies might be tailoring their political cues to different audiences on different social media sites, but it actually seems not to be the case. So when I measure political signals separately from companies on these two sites, they actually are largely correlated across the sites. And the findings that I just described about cues being pretty representative of stakeholders and firms’ agendas seem to largely hold across the two sites.
And so there are a few different kinds of political phrases that my measurement strategy picks up. They’re as follows:
So the first is group-based appeals, so think about mentions of the LGBTQ community versus mentions of veterans. Parties make appeals to different groups and this is very apparent in their messaging. The second is mentions of issues. So think gun violence versus gas prices or crime. Parties and partisans are thought to own different issues and focus on different issues altogether. The third is linguistic expressions. So a good example of this is “wear a mask” on the liberal side versus “God bless America” on the conservative side. And the last two are individuals and observances. Think about kind of mentions of George Floyd versus Ronald Reagan or mentions of Pride month versus Christmas.
The idea here is that mere mentions of these different kinds of appeals or phrases signal something about partisanship, and we can sort of talk more about that, but the most common type of political phrase that I see of these categories across Twitter and Instagram from brands is a group appeal. So roughly 37% of all phrases said by brands across these sites are group appeals. Issues are the next biggest category of phrases used. They make up about 30% of phrases. And then linguistic expressions make up about 19% of phrases.
So as you said, this is a comparison with congressional rhetoric, and I know that similar methods have been used to look at media bias and other kinds of analyses. And there, they’ve gotten some critiques along the lines of the assumptions that you make about what members of Congress are doing and why people are using certain language.
Matt Grossman: So how do you think about this as a measure of left-right ideology and how much does it depend on the kinds of phrases that members of Congress are using, not just the kind that brands are using?
Soubhik Barari: Yeah. The methodology in this paper, as you said, builds on previous Text As Data work that’s scales actors based on their speech. And my approach in this paper is to use a reference dictionary where we have a ground truth, so to speak, of what language is associated with “liberal democratic identity” versus more “conservative Republican identity.” And that reference dictionary is posts from members of Congress. In particular, I have a dictionary of a million Twitter and Instagram posts from the members of the 116th Congress spanning the last decade.
And so the key assumption in this approach is that speech can have both explicit and implicit political or partisan cues. There are certain cues that you hear in speech that sort of immediately and explicitly reveal the speaker’s political preference, the most obvious being position taking. So for example, “I oppose the right to abortion” is pretty high-signal about the speaker’s partisanship or ideology. But more than just explicit position taking, there are more subtle cues that this literature argues still signals partisanship and ideology based on the framing of certain phrases. For example, gun rights versus gun control, the classic example of being estate tax versus death tax.
And I think my paper goes a step further and says that there are even more implicit political cues that are associated with lifestyle and culture, all of which we know are sort of highly sorted across partisan lines. So a good example of this is usages of the American flag emoji. I find that Republican members of Congress are much more likely to use that online than are Democratic members of Congress.
And so basically, if I had to define political speech as it’s used in this paper, it’s basically phrases used by a corporate brand that are, first of all, not directly referring to the core business function associated with that brand; and second of all, that are either, as I’ve been defining here, implicitly or explicitly signaling partisanship by mirroring the speech of Democratic or Republican elites.
And so an important part of this approach and one hurdle to avoid here is to make sure that phrases that are not political when they’re said in certain contexts or by certain companies are sort of pruned from the dictionary. An example of this is that Democrats tend to talk a lot about healthcare, usually in reference to the legacy of Obamacare and sort of protecting affordable healthcare options, and they do so much more so than Republicans, and so this signals the importance of healthcare to the Democratic Party platform and the Democratic partisan identity. So apropos of nothing, if somebody talks a lot about healthcare and not a lot about cutting taxes or crime, you could sort of update in your head that person is or that speaker is likely more likely to be a Democrat than a Republican.
Now, corporate brands may also spend a lot of time talking about healthcare, but if that brand is a health insurance company, it is almost impossible to tell if they’re mentioning healthcare in reference to something like Obamacare and the kind of progressive ways that Democrats mention it, or if they’re talking about literally what they do as a corporate brand. On the other hand, if a brand like Harley Davidson mentions healthcare a lot, that probably has nothing to do with what they actually do as a company selling motorcycles, and so that signals partisanship in a meaningful way.
So contextually pruning these otherwise political phrases from non-political context is really important for the validity of this approach and I think the validity of this approach used in other papers and contexts too.
Matt Grossman: You have some comparison measures between how the company speaks and how their stakeholders speak and you find overall alignment, but talk more about those other kinds of speakers and what we should conclude from the fact that they’re roughly similar in their ideological position or at least if they’re correlated across companies.
Soubhik Barari: So I look at a bunch of different stakeholders in this paper, measured a bunch of different ways. When I look at consumers, I have two different measures of consumers’ revealed political preferences. One is using Twitter followership of these brands. So I look at a random sample of 200 followers of each brand and I scale those followers based on who they follow, the kind of ideological makeup of their Twitter followership. I also look at… I have the retail locations of all the brands that I could find and I look at how the geography in those retail locations leans left or right, so whether these retail locations mostly vote Democrat or mostly vote Republican in the last decade. And so this gives you a measure of the political preferences of consumers.
Similarly, I look at representatives of the home districts and home states of these companies. I use DW-NOMINATE to measure the ideological preferences of these elected officials. And then for the various internal stakeholders, the employees, the executives, the managers, employees of various departments, I look at political donations using FEC data.
And so basically what I find is all of these stakeholders across the board are aligned with the message of their employers online, but I would describe it as a weak alignment in absolute terms. So indeed, more liberal stakeholders and internal policies, which I’ll get into, does predict more progressive messaging, but the standard errors, I should say, are pretty high and it doesn’t seem like one stakeholder is represented necessarily more in the speech of these corporate brands online than others. It seems to be sort of generally directionally consistent across the board.
And then looking at internal firm measures of revealed priorities or preferences, I look at things such as their decarbonization strategy disclosures. There are often these companies or trade groups that actually survey companies based on the decisions they’re making around decarbonization. I look at companies’ PAC expenditures, both on candidates and interest groups. I look at companies’ regulatory compliance, so how often they have violations in employee discrimination and labor and environmentalism, all of these things being discussed online. And then I have a set of DEI measures of companies’ priorities. And so these are evaluations made by employees of workplace diversity and inclusion. So for example, the satisfaction of LGBTQ employees or the perceptions of diversity and inclusion by black employees or women employees. And I use specifically Glassdoor, which is a really popular site for disclosing this to measure that.
And again, all of these things, I find, do for the most part predict a consistent online brand image, but it’s still pretty weak. And so on the whole, I think this suggests that firms are not misrepresenting their activities and their agendas, nor are they fully out of step with stakeholders.
One thing to note is that when mismatches do happen between stakeholders and their employer’s messages, it’s usually that messages are too liberal relative to the views of stakeholders. So I guess in this sense, companies are more often “woke” than they are “unwoke” or being left of what stakeholders prefer. So for example, 23% of brands are more left, if you have to compare the scaled measure of their brand signal, are more left than the ideological makeup of their employees, whereas only 12% of brands are more kind of right-leaning.
Matt Grossman: So let’s dive in a little bit more to the other forms of political activity and internal form and activity a little bit because there has been this critique that what, like the billionaires we hear from are liberal, but behind the scenes, they’re funding the most conservative actors. The liberals, the companies might publicly signal that they’re against January 6th, support January 6th members of Congress supporting companies, but then six months later, they start funding those same members of Congress who voted to not accept election results.
So there’s this idea out there that this might be kind of a public face, but that behind the scenes, these folks are still right-wingers, and you could advance it a little bit, I guess less conspiratorial is just that maybe the PR departments of these companies are fairly liberal and they’re trying to gain employees, but their lobbying apparatus still wants low taxes and less regulation.
So to what extent do you find a mismatch between what the measures you do have of this kind of behind-the-scenes political activity and how much should we buy this critique that maybe it’s just a public image versus a private behavior?
Soubhik Barari: Yeah, so what I find in my paper is indeed corporations’ activity and their revealed political preferences based on their PAC expenditures is, most of the time, to the right of their messaging online. So anywhere between 59% to 62% of brands’ PAC expenditures are more conservative or more right-leaning than this scaled measure of their online presence.
That being said, brands’ PAC expenditures do actually predict the direction of their online image. So essentially, on the margins, a more left-leaning PAC strategy still does predict a more left-leaning online presence; it just so happens to be that the kind of intercept is shifted to the right altogether across the board for companies. So on average, companies are more conservative or rather just barely right of center in their campaign finance strategy, but it’s not the case that the most liberal left-leaning online brands are extremely conservative in how they allocate financial resources.
And then this sort of checks out based on what we know about how firms think about campaign finance, which is much more about access and strategic investments, knowing that it may not actually produce or extract the outcome that they’re looking for. On the other hand, public messaging, there’s just a lot more discretion in messaging. It’s maybe a little less clear what the desired desired outcomes are. And as you said, public messaging might reflect the kind of personal partisan proclivities of a different set of employees altogether, employees in marketing and PR as opposed to folks who work in government relations.
So just looking at the distribution of political preferences based on the FEC data, it doesn’t seem like the marketing and PR professionals are way more polarized or way more to the left of folks who work in government relations, so it’s sort of unclear exactly why we see this rightward shift, but I think I would say that it follows closely with this literature that campaign finance is just thought of as a different way to a lot of these companies than their messaging.
Matt Grossman: So as you said, you find that this is a relatively recent, and of course, we always hesitate to draw just one line on a time series, but it does seem pretty clear that the Black Lives Matter protests were very important in changes in corporate political speech, and you might add in the presidency of Donald Trump and kind of moving brands in this direction. So to what extent can we tell that story, that there was a response by companies to these specific events versus a longer term shift?
Soubhik Barari: So I think it was less about Donald Trump, the candidate or the president and more about Donald Trump as a series of extremely salient news generating public events or what we sometimes call in political science activating events. And so some examples of this are the Women’s March, the Paris Accord withdrawal and various statements, very public statements Donald Trump made on election denialism later in his tenure. All of which are things that companies have posted about online. So luxury fashion brands were posting about the Paris Accord withdrawal after Trump publicly decried that.
And so I think what these events did is that they generated a ton of downstream progressive activism that I think manifested in many ways, not just in politics either, but more broadly in culture and entertainment and media and sports, and also made its way into corporate politics. And so my paper doesn’t really get into the mechanisms of how these events pushed companies to speak more progressively. I think there is possibly a story of agenda seeding happening here where media outlets played a prominent role in setting the agenda based on this progressive activism.
So I would speculate that that’s kind of a core mechanism. But I think more than Donald Trump or kind of early Black Lives Matter activism, we really concretely see that George Floyd murder as kind of deactivating event for corporations public messaging on race specifically, which is one of the most kind of dominant group-based appeals that we see on companies social media feeds. So nearly 15% of all posts by all corporations in our sample during the week of George Floyd’s murder used some sort of democratic group or issue based appeal most of the time being Black Lives Matter or some variation of that.
And so 15% may not seem like a lot, but given the baseline of pretty much half of corporations at any time even talking about politics, I think a 15% is actually pretty high number and a high surge. There hasn’t really been a progressive activating event like that since, at least in my data, which goes up until about early 2023. I haven’t seen the Ukraine War, for example, generating much of, well, first of all, generating much of a partisan cleavage and elites language to begin with. And so we haven’t really seen that show up downstream in company’s speech or really much mention of the war at all.
And so we’ll have to watch this closely and see how this changes as we approach the 2024 cycle. But yeah, I would say that these activating events, these kind of new news events have really been, I think, what has pushed companies to go to the left.
Matt Grossman: So you’ve been in some sense kind of minimizing what you’ve been finding in terms of the extent of political speech and the extent to which it moves off to the left or the right, emphasizing that it’s pretty close to the center often and not very political even more. But it does seem like conservative activists would see your data as very consistent with the story that they’ve been telling that companies have been following progressive activists, especially lately. And even to political scientists raised in a literature that saw business as one dominant force on the right against maybe labor on the left, this would seem to be pretty different from the story that we tell.
So are you underselling the potential impact of what may be a small shift, but an important shift to the left by American corporations?
Soubhik Barari: Yeah. So I definitely don’t want to oversell and claim that there’s sort of a complete realignment happening between kind of big business interests and the Democratic Party kind of akin to the big realignments we have seen in the latter half of the 20th century and earlier. I think the fact that lobbying and PAC and campaign finance dimensions of corporate behavior are still appreciably right of center and moreover not really committed in an ideologically left direction, I think is a testament to that.
Furthermore, we really don’t have evidence that companies, as I maybe already mentioned, are further moving to the left. So we do see this dip into kind of liberal group-based appeals and issue appeals after the George Floyd murder. But again, we haven’t really seen the disappearance entirely of appeals to veterans or appeals to observances of Christmas or these other kind of more conservative or moderate or right of center cultural appeals. Those still are very much present in companies online presence.
But okay, so I think one could argue depending on the temporal reference point that any amount of speech on these issues and the fact that said speech is left-leaning even if just a little bit and only sometimes is remarkable. First of all, given the vast array of things that companies could be talking about. And second of all, given the history of companies relative silence on progressive issues going back 30, 40 years. I mean if you went into a time machine and told Reaganites in the 1980s in the heyday of the AIDS epidemic where companies were largely silent about the plights of the gay community.
If you told these people that at least some major corporations were spending an entire month decking out their social media profiles with kind of gay pride paraphernalia and expressing support for the LGBTQ community, I think you’re right that people in political scientists would be shocked. But I do think that we want to be measured in how we describe corporate political speech. Pride Month isn’t indicative of companies engagement year long year round on these issues, nor is it indicative of where they mostly put their money when it comes to marshaling political resources.
Matt Grossman: So you have very recent data and yet some people may sense a turn since you have been collecting the data. In particular, we’ve had a very salient backlash against Bud Light, for example, in response to a social media post by the company, a large one also against Target, though although it was about in-store displays. I think it was mainly spread through social media. And some evidence that at least those two companies and probably more are noticing that there’s a potential for right wing backlash to the kinds of political speech that you’re talking about, or the companies may consider them apolitical speech that has these liberal valence.
So what do you think? Do you think that we reached the peak of this and there’s any sign of a turn, and do you think companies are now going to see these as a potential liability?
Soubhik Barari: So you mentioned Bud Light. So Bud Light, according to the YouGov surveys that I use in my paper mostly has an older audience of consumers, mostly Gen X or Boomer age. But interestingly, according to my data, most employees are left-leaning rather than right-leaning. And most of Bud Light’s Twitter followers are left-leaning at least going up to early 2023. Another thing that’s worth mentioning is that Anheuser-Busch’s headquarters are in St. Louis, which is very much a left-leaning kind of geography. That being said, all of the accounts and the brands associated with Anheuser-Busch were really not political at all leading up to early 2023.
One part of the backlash against Bud Light and Anheuser-Busch might be a departure from otherwise apolitical brand messaging. And so this may be something for companies and corporate brands to keep in mind and think about when you’re going from not really talking about political issues at all to suddenly kind of picking one side and very much making that the focus of your online presence specifically in a way that’s kind of contrary to the preferences of your core stakeholder group. You might expect backlash there.
In terms of how much we can expect this kind of anti-corporate backlash from the right to continue, ordinarily we know that these consumer boycotts don’t typically last super, super long, multiple years. But I think given the fact that these prominent Republican elites, Ron DeSantis obviously coming to mind, given that these elites continue to message against these companies and given the kind of staunch partisan calcification that we see in the electorate today, I think we’re going to continue to see this kind of backlash as long as those two things hold.
On the other hand, we could see something similar to the George Floyd reckoning as I observe it in this paper where companies sort of one by one fall behind Anheuser-Busch and Bud Light. But we haven’t really seen that sort of activating event of that scale, at least when it comes to this issue of trans representation and trans rights. So I think we’ll have to kind of monitor and observe what happens. I’m not particularly optimistic that there will be this kind of big shift, but I would look out for these big kind of activating events that sort of push everybody, not just a single brand to fall behind a certain message.
Matt Grossman: So the other interview for this episode is with Eitan Hersh and he tracks the opinions of business leaders and their perceptions, and he finds that business leaders are perceiving their companies as moving leftward. Even those that don’t perceive them as on the left, that’s the direction they perceive. And to the extent that they separate the parts of the companies, they see employees as moving leftward and consumers really not moving. So I guess how well does that fit with your findings, and do you think that these corporate leaders are perceiving leftward movement because of these public messaging strategies?
Soubhik Barari: Yeah. So I think that finding is also generally born out in my paper. I think my paper finds as this other research that, so sort of “lifestyle polarization” is actually pretty low in the US. So when it comes to consumers and their stated preference for brands, there aren’t really extremely Democratic leaning brands and extremely Republican leaning brands. Like when you need dish soap, you look for other things rather that are not the political messaging of dish soap brands online. So I think that follows.
On the other hand, I do find that there is a more clear leaning in partisan preferences amongst employees. And beyond this paper, I think we have seen increasingly employees of very prominent companies exercise their voice and exercise activism from within these companies. I think activism in the tech industry and the kind of walkouts at Google that we’ve seen is a good example of that. So I think a lot of this has come from the employee side rather than the consumer side. That being said, I do think that consumers are well represented by the brands that they consume.
Even if not on partisanship, things like educational status of brands, consumer base does predict whether that brand is going to lean left or right in its online speech. So I don’t want to say that employees are represented more than consumers’ political preferences are. My data doesn’t really, and my findings don’t really bear that out, but certainly employees are a really important stakeholder and we do see that in how well their preferences predict online political speech.
Matt Grossman: So we also had a conversation about this, kind of what are the company’s true politics. Because the perception seemed to be that these companies are moving leftward kind of across the board, but it’s possible that what you’re seeing is also what they’re seeing. They’re seeing their companies make these public statements that seem leftward and maybe they’re not seeing as much of the behind the scenes political activity where potentially their firms are still lobbying for lower taxes and lower regulations.
So I guess what do you make about that kind of overall potential distinction and is that just a bifurcation that’s going to stick with us or is one kind of the true politics and it’s going to move in that direction? Because at least from the business leaders’ perspective, it does seem like they’re thinking that it’s the left word movement that’s going to stick.
Soubhik Barari: It is true that business leaders more often than not are to the right of their rank and file employees and particularly employees that you would think are involved in the brand decisions, the PR employees, the marketing employees, the legal employees. But it’s really actually the board members that are much more noticeably to the right of pretty much all of the stakeholders. So I don’t know if necessarily it’s the fundamental divide is between leadership and employees and the subsequent online kind of public image that the employees craft.
I think the board members are actually kind of the one group that doesn’t belong when you look at the ideological makeup of these companies. I think a company’s true politics in reality is multidimensional. There’s so many different activities and initiatives that companies engage in. And on top of that, there’s the messaging about these activities and initiatives. And then on top of that, there’s the political preferences of these individuals that make up the institution. Companies at the end of the day are basically just networks of contracts between individuals.
And so I think that a company’s true politics is in some ways unobservable. So many of these decisions are made in an opaque way. Some companies have internal committees that sort of deliberate on how they’re going to respond to these activating events like the George Floyd murder. The criteria they use is opaque even to other employees. These companies are not universally always choosing send tweet on a very progressive tweet on every issue. Much like how voters and the electorate are complicated and split ticket voting exists, I think the committees that make up these PR decisions also do “split ticket.”
But just returning to this point, we do know that lobbying and campaign finance is just seen in a different way. It’s seen much more as an investment vehicle than I think messaging is. I think messaging for a lot of companies may be even seen as a sort of consumption good, a sort of expressive channel, a way for employees to express a voice and a way for employees to be represented when it comes to these kind of thorny events that call for progressive activism. So I think the question of true politics is ultimately unknowable because we can’t observe every single dimension.
And even on the dimensions that we have observed, we don’t actually know which one is more important. So lobbying and campaign finance, even when they’re off diagonal, tend to be risky investments. They don’t always extract their desired outcomes. And this political messaging online is great, but we know that the persuasive effects, for example, of political advertising and even product advertising tend to be pretty minimal even though the persuasion tends to happen in the intended direction. So it’s sort of unclear to me what is the true politics at the end of the day of these companies.
Matt Grossman: So obviously we’ve observed fairly recent data here, and even the kind of social media age of brands is relatively recent. But is it possible that we were just kind of wrong in the first place in placing big companies on the right of American politics? As you say, their lobbying and campaign finance activity has often been access seeking and issue specific. Their general political positioning, if we looked back 30 years ago before it was on social media, it really might have just been kind of with the direction of society and some of what you’re observing might just be that there’s increasing acceptance of LGBT Americans and there’s a general move leftward in acceptance of diversity that companies are just reflecting.
So how much change do you think there really has been here and is it possible that we were kind of just wrong in ever putting business on the Republican side?
Soubhik Barari: So this is a good question. So the kind of focus on these core social groups that make up the Democratic coalition, it’s an interesting question of whether this reflects kind of corporations’ unique kind of priority or interest in these groups or whether this is a kind of broader reflection of cultural norm shifts and acceptance of these groups and prior prioritization of these groups. So if you look at Twitter as a whole, it may very well be the case that there is more of this sort of language than not.
I do think taking the kind of long view of this when it came to securing interests and securing relationships in Washington, it’s true that big business hasn’t always been completely wedded to the Republican Party. As we’ve talked about, a lot of these political vehicles are about access and investment often having to do with the incumbent administration. But I do think that given the Republican Party’s platform going back as early as the 19th century, it has made sense for the GOP to be the main political vehicle for businesses.
This was clear during the New Deal era. This was clear when this round table became this organizing force for a big business in the 1970s, and it was certainly clear in the Reagan revolution. Based on the policy platform alone, the GOP is clearly the right bedfellow for big business. At the same time, that’s not to say that democratic elites weren’t occasionally bedfellows with big business. During the New Deal era, the Democratic unionists did strike deals with corporate leaders. The modern Democrats’ relationship with the tech industry for the last 20, 30 years is a good example of that relationship.
But I do think that in terms of big businesses’ outward presence, public image, branding, what we’re seeing in my paper isn’t necessarily unique. Tobacco companies in the 1940s and ’50s, their branding was all about appealing to feminism. It’s appealing to youths. The Torches of Freedom Campaign was all about associating tobacco smoking and cigarette smoking with feminism and kind of progressive values and virtues associated with being seen with a cigarette. Thomas Frank has a great book that’s called The Conquest of Cool about how in the ’60s and 70s similarly, a lot of liberal kind of hippie youth culture actually made its way into mainstream advertising and marketing practices and formed the basis for what he calls hip consumerism.
So I think this pandering to progressive values even while kind of seeking whatever coalition building and relationship building makes sense given the issues of the time, the administration of the time. I think that’s a much older story than my paper.
Matt Grossman: There’s a lot more to learn. The Science of Politics is available biweekly from the Niskanen Center. I’m your host, Matt Grossmann. If you like this discussion, here are the episodes I recommend you check out next. How the Plutocrats Win from the Populist Right, How Campaign Money Changes Elections Before and After Citizens United, How Conservatives Transformed the States, How the Tea Party Paved the Way for Donald Trump, and Are the Democratic and Republican Parties Becoming More Similar or Different. Thanks to Eitan Hersh and Shubik Bharari for joining me.
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