Disney attack by Gov. DeSantis is latest GOP threat to Big Business


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Six years ago, then-Indiana Gov. Mike Pence scrambled to change a “religious freedom” bill he had just signed into law because corporate America objected.

Apple and Salesforce opposed the bill, which seemed to allow businesses to discriminate against gay men and lesbians. Eli Lilly, a big employer in the state, called it “bad for Indiana and for business.” Indiana’s Chamber of Commerce said the law was “entirely unnecessary.”

Legislators listened. The Republican-controlled statehouse quickly revised the bill to clarify that it could not be used to deny service based on sexual orientation. Pence signed it. And a fight between two longtime allies — companies and Republicans — was over.

But Pence’s capitulation can feel like a postcard from a distant era as growing numbers of state and federal Republican leaders today seem eager to clash with the country’s biggest corporations over bills on similar hot-button issues.

DeSantis proposes dissolving special tax status for Disney World

Last year, the GOP attacked entities such as Delta Air Lines and Major League Baseball for standing against Georgia’s restrictive voting law. Citigroup was threatened for taking action seen as opposing Texas’s recent abortion law. And Disney’s complaints about Florida’s new law limiting classroom discussion of sexual identity has led to Republicans targeting the Magic Kingdom’s perks. On Thursday, the GOP-controlled Florida legislature passed a bill that would eliminate Disney’s special district status, sending it to the governor. The implications of this major change remain unclear.

Despite the onslaught, companies are not backing down — goaded by heightened expectations from customers and employees. Citigroup did not rescind its offer to help its Texas workers obtain out-of-state abortion services after the new restrictive law there, despite the threat from a state GOP representative to block the financial company from underwriting municipal bonds.

The result is fresh cracks in the once-sturdy relationship between companies and a business-friendly GOP.

This strange new state of play is starkest in the clash between Florida Gov. Ron DeSantis, a Republican with presidential ambitions, and the Walt Disney Co., a theme park and entertainment giant with 80,000 workers in the Sunshine State alone.

In a surprise move this week, DeSantis asked Florida legislators at a special session on congressional redistricting to also look at killing off any self-governing districts created before 1968 — including the one Disney World has benefited from in the Orlando area for nearly six decades.

A governor’s spokesman said this was not about revenge for Disney publicly opposing a bill favored by DeSantis that banned discussions about sexual orientation or gender identity in primary school classrooms.

How Disney fell flat in fight over LGBTQ talk in Florida’s schools

“This is about evening the playing field for businesses in Florida,” Bryan Griffin, a spokesman for the governor, said via email. “Yes, Disney benefits from one of these special districts, but the call is to examine the existence of all special districts.”

Aubrey Jewett wasn’t buying it.

“It’s clear they’re doing it to punish Disney,” said Jewett, an associate professor of political science at the University of Central Florida, noting the fallout from erasing special districts is something legislators would usually want to study before doing.

“In normal political times,” he said, “this would be unthinkable.”

There is little normal about Florida’s governor going after the state’s most powerful company.

The formally titled Parental Rights in Education bill, signed last month by DeSantis, was instantly polarizing.

DeSantis press secretary Christina Pushaw labeled it the “Anti-Grooming Bill.”

Disney was hit for not doing enough to stop the legislation and protect its LGBTQ workers. Disney executives apologized. They promised to halt contributions to Florida politicians while they reexamined priorities. Then the company said the bill “should never have passed and should never have been signed into law” and promised to push for its repeal.

Even after signing the bill, DeSantis kept taking shots at Disney. He said the company had “crossed the line.”

“They do not control this state,” DeSantis added.

Other Republican legislators joined in.

State Rep. Randy Fine tweeted that he was introducing a bill to eliminate Disney’s Reedy Creek Improvement District: “Disney is a guest in Florida. Today, we remind them.” It hasn’t stopped there.

Companies, facing new expectations, struggle with pressure to take stand on Georgia voting bill

A group of 17 Republican Congress members wrote a letter to Disney chief executive Bob Chapek saying they would not support extending copyright protection for Mickey Mouse beyond the 2024 expiration date. The letter, from Reps. Jim Banks (R-Ind.) and Chris Jacobs (R-N.Y.), among others, said Disney “has capitulated to far-left activists through hypocritical, woke corporate actions,” pointing to the company’s opposition to the Florida classroom bill.

Disney did not respond to a request for comment. The Business Roundtable, which includes CEOs of the country’s largest companies, declined to comment.

The U.S. Chamber of Commerce, billed as the world’s largest business organization, indirectly addressed the issue of GOP lawmakers seeking retribution against companies opposing them on social issues.

“It is the Chamber’s long-held position that policymakers should judge policies on the merits of the policy and what is good for increasing prosperity for their constituents and the nation,” Chamber spokesman Tim Doyle said.

Didi Kuo, senior research scholar at Stanford University’s Center on Democracy, Development and the Rule of Law, said, “I think corporate America has been torn about how to proceed.”

Companies would prefer to avoid these issues, Kuo said. But the old rules about how politics and business mix are changing. The Republican Party appears to be staking out less-mainstream views on some cultural issues, Kuo said, making it harder for companies to navigate.

This has shuffled some familiar allegiances. In 2017, Sen. Mitch McConnell (R-Ky.), then the chamber’s majority leader, helped push through one of the largest corporate tax cuts in history, but last April he sent companies a message: “My warning to corporate America is to stay out of politics.”

McConnell’s outburst was in response to corporate America’s opposition to Georgia’s voting bill, passed in March 2021. Opponents said the legislation was aimed at making it harder for some people to cast ballots.

Hundreds of companies — including Target, Microsoft and American Airlines — signed onto a statement that called voting “the lifeblood of our democracy” and said that “we must ensure the right to vote for all of us.”

Major League Baseball decided to yank that summer’s All-Star Game from Georgia.

Ed Bastian, leader of Atlanta-based Delta Air Lines, told employees what he thought of the legislation, including, “The final bill is unacceptable and does not match Delta’s values.”

That did not sit well with some Republicans.

How two Black CEOs got corporate America to pay attention to voting rights

Sens. Ted Cruz (R-Tex.), Marco Rubio (R-Fla.), Josh Hawley (R-Mo.), Marsha Blackburn (R-Tenn.) and Mike Lee (R-Utah) introduced a bill to strip MLB of its antitrust exemption, which classifies the league as a sport rather than a business.

“If Major League Baseball is going to act dishonestly and spread lies about Georgia’s voting rights bill to favor one party against the other, they shouldn’t expect to continue to receive special benefits from Congress,” Cruz said in a statement.

The bill never went anywhere. But their point was made.

And Georgia’s Republican-controlled House voted to revoke a jet fuel tax break used by Delta to save at least $35 million a year. That bill died before full passage.

Georgia legislators passed a similar bill in 2018 after Delta ended a partnership with the National Rifle Association in response to the school shooting in Parkland, Fla. But then-Gov. Nathan Deal, also a Republican, stopped collecting the tax months later.

Jeffrey Sonnenfeld, a Yale management professor with close ties to corporate boardrooms, said companies were not backing down from the fight with what he called “GOP cancel culture grandstanding threats.”

“Companies scoff at this pathetic barking from dogs chained up by their garages,” he wrote in an email to The Washington Post, arguing that the “Trump-oriented GOP” had already lost the mainstream U.S. business world.

Dozens of companies paused or stopped making political donations to the Republicans in Congress who voted against certifying the 2020 election of Joe Biden, he said. At least 600 companies signed petitions against Republican-led restrictions on voting access last year.

One unusual aspect of DeSantis’s threats against Disney is that he has appeared willing to follow through. But it is unclear what the impact will be if Disney World loses its special district privileges.

Disney is more vulnerable to threats of political vengeance because it lacks what is often a corporate trump card: The easy ability to move.

Benjamin Means, a business law professor at the University of South Carolina, has studied what he calls the power of “corporate exit” — whether that is moving headquarters or shifting investments.

“Disney, they really can’t pick up their ball and go home,” Means said. “You can’t relocate Disney World.”

But DeSantis’s tactics could make Disney rethink future investments. California Gov. Gavin Newsom (D) already has asked the company to reconsider moving 2,000 jobs from his state to Florida.

Colorado Gov. Jared Polis (D) used the recent turmoil to make pitches to Disney and Twitter — the tech company also has been criticized by DeSantis for its opposition to a takeover bid from Tesla chief executive Elon Musk.

“Florida’s authoritarian socialist attacks on the private sector are driving businesses away,” Polis tweeted.

Texas GOP politicians have been putting pressure on companies, too. Last year, Lt. Gov. Dan Patrick attacked Fort Worth-based American Airlines for opposing changes to state voting laws.

“Texans are fed up with corporations that don’t share our values trying to dictate public policy,” Patrick said in a long statement.

The politics of revenge are not helpful to running a government, said Jewett, the political science professor. “It’s no way to make good public policy.”





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Sunday April 24, 2022