It’s rapidly becoming the received wisdom that an important reason President Trump won the 2024 election was because inflation matters. Too many hard-working families had seen their household budgets shrink, even as the federal government continued to engage in record levels of spending. In doing so, the Biden administration ignored the wisdom of the late Milton Friedman that central bankers always overcorrect at the sign of economic contraction. President Biden even made the connection explicit: “Milton Friedman isn’t running the show anymore.” But it turns out Friedman was right—increasing spending and printing money are a recipe for inflation, and voters hate inflation.

　　Friedman has been on the outs for a while. It’s nothing new for the left to deride him—as a Young Conservative in the UK in the ‘80s I would frequently be attacked as a “monetarist,” by people who had no idea what monetary policy was, such was his perceived influence over Margaret Thatcher. Leftists continue to this day to launch harsh broadsides against his memory. Yet recently, even self-proclaimed conservatives have consigned him to history in terms just as severe as Joe Biden.

　　Senator Josh Hawley, for instance, told the National Conservatism conference this year, “Now we need not the ideology of Rand or Mill or Milton Friedman, but the insight of Augustine.” Rusty Reno, the editor of First Things, criticizes him in his book, Return of the Strong Gods. Yoram Hazony invokes Friedman’s Free to Choose in The Virtue of Nationalism to critique it. And Compact Editor Sohrab Ahmari commented, “Whiney voice: But, but, but, what would Milton Friedman say?” when the Hungarian government instituted price controls, to which Ross Douthat of the New York Times responded, “He would say that this won’t work as intended, presumably.” (Spoiler: they didn’t.)

　　Another piece of Friedman’s advice has also been rejected in recent years by left and right, yet its validation may have contributed to Trump’s victory. It’s known as the Friedman Doctrine, the norm that the social responsibility of business is to increase profits. Friedman expounded his theory in the New York Times Magazine in 1970, in response to a growing number of businessmen who suggested that businesses had responsibilities to the wider community. Friedman responded, “Businessmen who talk this way are unwitting puppets of the intellectual forces that have been undermining the basis of a free society these past decades.”

　　It was an old debate resurrected. In the 1930s, the New Deal exponent A. A. Berle and Harvard Law professor Merrick Dodd had a public back and forth over exactly this question, with Berle seemingly victorious in his claim that shareholder interests should be subordinated to a number of claims by labor, by customers and patrons, by the community” over Dodd’s contention that businesses should only cater to shareholder interest. By 1970, however, there was growing concern that this emphasis on what became known as “stakeholder” interests had led to corporatism, with businesses exerting too much power over public policy.

　　The widespread acceptance of the Friedman Doctrine that followed Friedman’s article changed that for a while, but not for long. By the mid-1990s there was growing pressure on corporations to “do good,” particularly in relation to the environment. What the late economist David Henderson called a sense of “global salvationism” became an important motivator of corporate behavior. This was the idea that it was part of corporate meaning to help change the world.

　　This time the newer professions of management and accounting theorists got in on the act. Concepts like the “triple bottom line” and “corporate social responsibility” infiltrated business training and ethics courses. While under the Friedman Doctrine, simply existing as a business, providing goods or services, jobs, and profit, was seen as the appropriate role of the corporation in the social fabric, it became commonplace to assert that businesses had to “give back” to the community. Businesses had to divert profits to spending on community activities, something Friedman derided as a form of socialism.

　　Indeed, what was different from the New Deal version of stakeholder theory was that the basic conservative ethics of honoring contracts and doing no explicit harm to third parties was replaced by progressive ethics of actively aiding various special interest groups defined by left-wing activists. Stakeholders were no longer groups like employees and vendors, but more nebulous ideas like “the global environment,” which allowed leftist pressure groups to stand up as if they were the Lorax and claim to speak for them.

　　The business of business is business, and that is what helps consumers and civil society thrive, whatever the Harvard Business School says.

　　After the 2008 financial crisis, this gear shift went into overdrive. It was no longer simply corporate spending, but how corporations behaved internally. This evolved into what became known as ESG—environmental, social, governance—that acts as a set of corporate norms over how firms operate. For instance, in describing the social aspect, IBM says the standards refer to “the impact the organization has on people, culture, and communities and looks at the social impact of diversity, inclusivity, human rights, and supply chains.” This clearly goes far beyond local community and instead reflects the principles of global salvationism.

　　And then another controversy erupted in America over what was perceived as racially biased policing. That concern culminated in the Black Lives Matter movement, and another set of principles was widely adopted. Diversity, equity, and inclusion (DEI) was initially aimed at providing more equal opportunities. However, it quickly morphed into language—or even thought—policing and corporate struggle sessions.

　　These twin sets of policies soon went from internal practices to external. Businesses had to be seen to be exporting these values to their customers. So, the National Football League played two national anthems (the actual national anthem and the “black national anthem,” “Lift Every Voice and Sing”) at every game. Disney’s Star Wars explored the idea that the Jedi Knights were evil. Video game characters were rendered less attractive to young men for fear of catering to the “male gaze.” Restaurants stopped providing plastic straws in favor of soggy paper straws. And woke businesses started demanding that suppliers adopt the same woke standards and practices.

　　Meanwhile, government got in on the act. The Securities and Exchange Commission promoted rules for listed companies to enact ESG standards. The Equal Employment Opportunities Commission expanded its existing efforts to promote DEI. Every corporate and government effort, it seemed, was aimed at pushing business activity into political correctness.

　　Unfortunately for them, one group seemed wary of what was happening—consumers. NFL audiences dropped. Disney’s streaming service struggled amid claims of a “woke” agenda. Video games became a cultural battleground. Famously, Bud Light sales crashed following its attempt to use a trans influencer as a spokesperson. Firms like Lowes, John Deere, Ford, and even Meta dropped their political stances in response to consumer pressure.

　　The consumer backlash had a political effect. The weekend before the election, the New York Times admitted of these radical practices that “the brief era of their unquestioned dominance is now coming to an end.” Young men in particular, a group whose preferences were a target of many of these changes, came out to vote Republican in a reversal of previous trends.

　　We don’t yet have the data to demonstrate the electoral effect, but corporate behavior has been a major target of the cultural champions of young men like Ben Shapiro and Jordan Peterson. It should, however, now be obvious that catering to perceived stakeholders (often actually just more special interests, like the environmental movement) over customers is a bad business decision.

　　Corporate leaders made a bad bet by doubling down on ESG/DEI initiatives. It has hurt them financially and reputationally. Now they will face an administration that will do an about-face on these policies, questioning and investigating what once it encouraged.

　　It is time for the Friedman Doctrine to make a return. The business of business is business, and that is what helps consumers and civil society thrive, whatever the Harvard Business School says.