8 September 2018

What’s wrong with woke capitalism?


Nike could hardly have picked a more controversial sportsperson as the face of their latest advertising campaign, which it unveiled this week. Colin Kaepernick is the American football player who began kneeling during the national anthem at the start of NFL games in 2016 to protest against racial injustice and police brutality.

Mr Kaepernick is currently without a team – a fact he is suing the NFL over – but dozens of active players have followed his lead, kneeling on a weekly basis and invoking the ire of millions – including Donald Trump.

So it is hardly a surprise that, when Nike gave Mr Kaepernick the swoosh of approval and the slogan ‘Believe in something, even if it means sacrificing everything’, the backlash was fierce. Some Trump-supporting Americans filmed themselves burning their Nike trainers and posted the videos online. Mr Trump himself took the bait and sent a tweet.

The market’s immediate reaction was also disapproving: $3.4 billion was wiped off the value of Nike’s stock in the days after the campaign was announced.

It is too soon to say whether the decision will make business sense in the long run. According to one calculation, the furore has generated publicity worth $163 million.

And if the gamble does pay off, it will be thanks to – not in spite of – videos of burning trainers and intemperate Presidential tweets. Two-thirds of Nike’s customers are under 35. Young, affluent, urban consumers who spend their money on trainers are more likely to sympathise with Mr Kaepernick than the average American. The company has long cultivated an image as an anti-establishment outsider and sold a lot of trainers by doing so.

Nike’s campaign is perhaps the best example yet of what has been disparaged as ‘woke capitalism’. The term, coined by conservative New York Times columnist Ross Douthat earlier this year, refers to the emerging tendency of companies to take a stance on social and political issues. It is a trend that has accelerated in the Trump era.

Parts of the left and right have made common cause against this newfound corporate wokeness, dismissing it as cynical, hypocritical and disingenuous.

The main charge is that the likes of Nike don’t mean what they say; and that we shouldn’t be tricked into thinking their political interventions are about anything other than the bottom line. But woke capitalism’s critics miss the point.

Distrusting corporate intentions is nothing new on the left. The right, however, should remember their Adam Smith and know better than dismissing a given action just because it is motivated by profit: ‘It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.’

Woke capitalism is also a moderating force. It marshals political arguments in a way conservative should welcome. Progressive messages are co-opted and recast in less radical terms. Thanks to the democratic nature of the market, it’s also hard for woke capitalism to get out of hand. It may be cynical, but the effect is stabilising.

Nike’s advertisement campaign is a good example of this. It is notably free from the kind of identity politics that pollutes so many debates. Mr Kaepernick, who narrates the advertisement, endorses an individualistic, aspirational message: ‘Don’t believe you have to be like anybody to be somebody.’ It is a liberal, entirely non-revolutionary sentiment.

In a recent defence of business, the always thought-provoking US economist Bryan Caplan described businesspeople as ‘the least-flawed major segment of society’. Given a choice between corporate executives jumping on the anti-Trump bandwagon and leaving ‘the resistance’ to activists, community organisers and academics, I know which I’d prefer.

Woke capitalism therefore manages to be both socially progressive and conservative all at once. It is a mechanism that pushes society forwards but does so incrementally and responsibly, one pair of trainers at a time.

This article is taken from CapX’s Weekly Briefing email. Sign up here.

Oliver Wiseman is Editor of CapX.