With the midterm primaries behind us and early ballots on their way to voters, four trends are emerging as we head into the midterms that are likely to have long-term consequences for corporate America: Polling, partisanship, passion and populism. The first three are making it increasingly difficult to predict with any certainty the outcome of the midterm elections. The fourth, populism, poses great danger to business leaders.
Polling has become increasingly unreliable as it’s become harder to get an accurate sample. Fewer people are willing to be polled and it’s gotten tougher than ever to get people to tell the truth when they are called by a pollster. When two respected polling operations like Trafalgar and the Wall Street Journal report different results on the generic congressional ballot, one or both is likely to be wrong.
Demographics have become more complex are continuing to shift as communities become increasingly diverse, which requires a closer and closer understanding of the subgroups within any given population. Aside from making political predictions more fraught than ever, the lack of good data means corporate America is missing crucial information it needs to prepare for the outcome.
Not only has the bitterness between Republicans and Democrats increased, but so has the bitterness within each party. According to a Washington Post/ABC News survey, 56 percent oof Democrats don’t want Joe Biden to be the candidate in 2024 and a similar number of Republicans don’t want Donald Trump to be.
When an abortion amendment was on the Kansas primary ballot last month, turn out increased 95%, almost double that of four years ago. But 20% of those people – 180,000 ,000 out of 900,000 – voted only on the abortion amendment and did not vote for a single candidate in either primary. That suggests that while the issue helped to get out the vote, it’s not clear what partisan impact it may have, since abortion won’t be on the ballot in most states this November. Roe may turn out Democrats, and revenge is just as likely to turn out Republicans.
The fourth threat to corporate resilience is populism. As Jeff Berkowitz at Delve recently said, there may be a red wave in December, there may be a blue wave. The wave that’s going to flood corporate America is called populism and progressivism.
As corporate America gets caught up in political issues, it faces enormous risk when it crosses the line from corporate social responsibility to corporate social advocacy. And Republicans won’t be there to save them anymore. The pushback from Florida’s governor against Disney and attacks against Delta Airlines for its stance on voting rights are just recent examples.
Back in the 30s, Huey long said, “A corporation is the greatest natural enemy ever given to a politician.” Corporations have to learn how to walk a fine line in every generation. Corporate leaders and other interest groups – labor unions, consumer organizations, minorities, political parties – are all going to have to become more cautious in how they undertake their advocacy. Sometimes an organization’s values demand they take a politician on – and sometimes it’s possible to take a position or engage in social advocacy in a way that doesn’t put the corporate front and center. Unlike Delta, Southern Company has done a good job of handling contentious issues – from its position on voting rights to its willingness to engage in a discussion of climate change at its annual meeting.
In this environment, political crisis planning is just as crucial to an organization’s survival as planning for any other kind of disaster. A corporation may say, “Abortion is a matter to be settled by the courts, the legislature and by individuals.” That’s fine; but then they’d better be ready to navigate questions like “Is your healthcare going to pay for your employees to go out of state, to get an abortion? If not, aren’t you creating two classes of employees — those that can afford it and those who can’t?” Knowing the services and benefits you’re willing to provide and the messaging you’re giving to internal and external constituents takes understanding them stakeholders and planning.
To the extent it’s possible to predict the outcome of the midterms with any accuracy, gridlock in Washington is likely to continue. That offers opportunities for corporations to engage at the state and local level.
Infrastructure projects — whether they are pump storage pipelines, transmission lines, the location of solar and wind facilities – might have national mandates and funding, strong social acceptance and approval by state regulators. But one community can say “not here” and stop it. The solution is creating an environment where policy makers and public officials are comfortable that support exists for their decisions.
Corporations are very good at knowing what they want to say to shareholders, key customers and community leaders. What they do less well is understand what all those constituents care about. In a crisis, it’s the 5 or 10 or 20 or 100 key people and their touch points that make a difference. In a high-tech world, high touch still matters.