Abortion could become a business nightmare in 2022
The Supreme Court seems poised to trigger a political earthquake next year, with a ruling that could restrict or overturn nationwide abortion rights enshrined in the 1973 Roe v. Wade decision. If that happens, as many legal analysts expect, the shock waves will emanate in unpredictable directions and probably cause major headaches for American businesses in certain states.
In a Dec. 1 hearing on a restrictive Mississippi anti-abortion law, the court’s six conservative justices signaled a willingness to endorse the Mississippi law and perhaps go further by overturning Roe completely. Either way, such a decision, likely by the summer of 2022, would embolden other states to strengthen anti-abortion laws, which, in turn, would produce a furious backlash by abortion-rights supporters. And one of the first targets of protesters these days is big companies operating in states propagating whatever law the protesters object to.
If the Supreme Court overturns Roe, it wouldn’t mean abortion is banned nationwide; it would mean states can choose for themselves whether to ban the procedure, with no federal law standing in the way. Twelve states have “trigger laws” that would automatically ban abortion if the Supreme Court allows them to: Arkansas, Kentucky, Idaho, Louisiana, Mississippi, Missouri, North Dakota, Oklahoma, South Dakota, Tennessee, Texas and Utah. Another 14 states don’t have trigger laws but might pass bans anyway, including Florida, Georgia, Michigan, Ohio, and Wisconsin.
Abortion bans could become the most explosive political issue in modern times because the Court, if it upholds the Mississippi law, would be setting a precedent starkly contrary to public opinion. Most Americans think abortion should be legal. In Gallup surveys, just 22% of respondents say abortion should be illegal in all circumstances. Fifty-four percent say abortion should be legal in certain circumstances, while 21% say it should be legal under all circumstances. That’s essentially an endorsement of the status quo, since Roe allows abortions up to the point a fetus can survive outside the womb, generally considered 23 to 24 weeks into a pregnancy.
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Statewide abortion bans would also break sharply along partisan lines, since all of the trigger-law states are red states with Republican governors and, in most cases, GOP-controlled legislatures. Blue states, such as those on most of the East and West Coasts, might move in the opposite direction by codifying the right to an abortion and welcoming abortion seekers from states where the practice is banned. This would probably intensify the country’s blue-red divide and a type of polarization that’s now becoming geographic as well as ideological.
Possible protests and boycotts
It could also make targets of big companies based in states banning abortion. Protesters have already called for boycotts of companies based in Georgia, following that state’s passage of a controversial bill that might make it harder to vote. Major League Baseball moved the 2021 All-Star Game out of the state because of the law. In Texas, which passed a similar voter-restriction bill this year, some companies proactively lobbied against the bill, while others stayed silent. In April, Senate Minority Leader Mitch McConnell said, “My warning to corporate America is to stay out of politics.” But that’s impractical when consumers, employees and shareholders demand companies take action, as has been the trend.
So, which companies might be targeted? Texas, a trigger-law state that recently passed its own controversial law restricting abortion, is home to at least 50 Fortune 500 companies, including consumer brands such as ExxonMobil (XOM), AT&T (T), American Airlines (AAL), Southwest Airlines (LUV), USAA (USAGX), D.R. Horton (DHI) and Kimberly Clark (KMB)—plus newcomer Tesla (TSLA). Georgia hosts Home Depot (HD), UPS (UPS), Delta Air Lines (DAL), and Coca-Cola (KO). Tennessee is home to FedEx (FDX), Dollar General (DG), AutoZone (AZO), and Nissan’s U.S. operations.
It’s not clear yet how the powerful and well-funded abortion-rights movement would mobilize if the Supreme Court opened the door for state-level bans. Abortion is an intensely emotional issue, and the response could dwarf the types of protests that followed enactment of the voter-restriction laws in Georgia and Texas earlier this year. It’s also possible the issue could backfire for Republicans if new abortion bans produce a groundswell of support for pro-abortion Democrats in next year’s midterm elections, along with state and local races.
Boycotts, if they do end up as part of the fracas, don’t necessarily work. Business executives have some influence on tax and regulatory policies in their states, but that doesn’t automatically extend to social issues or other matters that aren’t primarily business issues. Sometimes, out-of-state companies have more influence. In 2015, when Indiana passed a “religious freedom” law that many felt discriminated against gays, California-based Salesforce and other organizations threatened to take conventions and other business out of the state. It wasn’t long before Indiana, under Gov. Mike Pence, relented and changed the law.
Companies that come down on one side of a hot-button issue also risking alienating customers on the other side. When Delta, under pressure from gun-control advocates, canceled a discount for members of the National Rifle Association in 2018, gun-rights advocates threatened to boycott. Some voters boycotted Goya Foods because of its CEO’s strident support for President Donald Trump, but that may have prompted other Trump supporters to buy more Goya products. No wonder most CEOs strongly prefer to stay out of politics altogether. That’s increasingly difficult, and 2022 could present more political landmines than businesses have had to navigate in years.
Rick Newman is the author of four books, including "Rebounders: How Winners Pivot from Setback to Success.” Follow him on Twitter: @rickjnewman. You can also send confidential tips.
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