Morning Wire - Sunday Wire: The War Inside Disney

Episode Date: March 27, 2022

While The Walt Disney Company positions itself as a political culture warrior, an internal struggle brews. Employees up and down the corporate hierarchy have spoken to us under the condition of anonymity. They reveal the tribal divide developing as Disney continues its leftward shift. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Corporate activism has become increasingly common in today's politically divisive landscape. It's now commonplace for corporations to weigh in on political or cultural issues, even if doing so affects their bottom line. In this Sunday edition of Morning Wire, we take a closer look at the upheaval within the Disney Corporation over new LGBT laws. I'm Georgia Howe with Daily Wire editor-in-chief John Bickley. It's Sunday, March 27th. And this is your special edition of Morning Wire. This show is brought to you by Good Ranchers.

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Activist employees pressuring their corporate leaders to use influence to impact politics is becoming increasingly common in the corporate world. Perhaps nowhere has this trend been more evident than at Disney Corporation and its subsidiary studios Pixar, Lucasfilm, and Marvel. And now Disney has become an outspoken opponent of a Florida bill titled Parents Rights in Education, which bans public schools from discussing sex and gender identity with children in kindergarten through third grade. Daily Wire Culture reporter Megan Basham has spoken to Disney employees up and down the ranks from engineers to corner office executives. She joins us now to talk about how an entertainment company became so mired in conflict over a state education bill and what that tells us about the state

of politics today. Megan, thanks for being here. Yeah, thanks for having me. So Megan, there seems to be a pattern forming in stories like these. But I want to go back to the beginning. Will you remind our listeners how all this trouble began for Disney and for Disney's CEO, Bob Chapic? Right. So Disney's previous CEO, Bob Iger, was known for being something of a political activist. He willingly spoke out on things like a Georgia abortion bill and former President Trump's restriction of travel visas for some Muslim majority nations. He was also a big Democratic donor, and he was also a big Democratic donor, and he openly signaled that he would be open to a position in the Biden administration. He even flirted with running for president. But when Iger retired and Bob Chapic became CEO in February of

2020, it seemed pretty clear that Chapic wanted to do things differently. Now, sources high up in Disney tell me that Chapic is, in fact, something of a conservative. In fact, he hired a former Bush appointee for one of the highest profile jobs in the company, Chief Corporate Affairs Officer. And he came into the company, as one source told the Hollywood reporter, quoting here, staunchly opposed to bringing Disney into issues he deems irrelevant to the company. So it was no surprise, really, when he said that Disney was not going to take a public position on the Florida bill. The reason he gave employees in a company-wide memo was that corporate statements are, again quoting, weaponized by one side or the other to further divide and inflame.

And he said Disney could better affect the culture change, some of those employees want to see through its films and TV series. But he changed his mind. So what happened? Yeah, he did. And I think essentially, Chepic just came under enormous pressure. So one high-level Disney executive, who of course spoke to me on the condition of anonymity, described it as something like a Disney deep state that was just determined to subvert any attempt to change the culture of the company and move that dial back to a more politically neutral position. So to start with former CEO Iger himself undercut Chapix position.

On February 25th, he retweeted a statement from President Biden that called that bill hateful. And he added his own comment saying, I'm with the president on this. If passed, this bill will put vulnerable young LGBTQ people in jeopardy. Well, after that, a slew of Disney employees and creators began airing their own displeasure with Chapix decision on social media. To give you one example, this is Dana. Tara. She's the creator of Owl House. So that's a Disney Channel cartoon series that features a gay romance at the center of the story and a non-binary character. Well, we got an email. We got a company-wide email this morning basically telling us, in summary, Disney as a company

is not going to change doing any of this. We're not going to not give money to these people. But here are a bunch of flowery and compassionate words to shut you up. And you're saying that she wasn't alone. There was a lot of this on social media. Oh, man, yes. Just a ton. So employees and creators freely and openly criticize the company. Another big example, a group of employees at Pixar, which is owned by Disney, put out an open letter accusing Disney executives of removing gay affection that was their term in their movies against creators will. So I think that that more than anything illustrates the shift that's taken place at Disney in the last. 10 years or so, that the studio is now openly agitating for LGBT content in movies for kids. And there have been some LGBT characters in Disney films in recent years, haven't there?

Right. Yes, there have. So Disney does tend to keep those scenes short and contained, because then they'll be easy to cut for foreign markets that are less amenable to that. But even some movies for the very youngest kids have featured things like lesbian moms, say in Toy Story 4. There was also a gay police officer in 2020's animated children's movie Onward. That starred Chris Pratt. For the tween years, as we said, Disney Channel has that show Owl House. And the network has also introduced gay characters in high school musical in Andy Mack. Just a couple of weeks ago, Pixar released a new animated film Turning Red that's been sparking controversy over some sexual themes, including a 13-year-old character twerking. So I think you have to say that it's a long way from the Disney

of yesteryear. Because back then was when Walt Disney famously said, whatever success I have had in bringing clean and formative entertainment to people of all ages, I attribute in great part to my congregational upbringing and my lifelong habit of prayer. Now, was Pixar the only studio to openly attack its parent company? I would say Pixar employees were certainly the boldest with that letter, but they weren't alone. Lucasfilm also put out a statement, Marvel put one out two, all three of them, basically said the same thing. And I think you can see by all of that what my source meant by a deep state that really seemed determined to undermine Chepic's intention to stay neutral. As you might expect,

those kind of posts were just catnip for the media. And they generated just a massive amount of headlines. One columnist in the Orlando Sentinel said, in other states, businesses have used the political power they purchase to effectively neuter culture wars. And that was something that the Pixar employees echoed in that open letter. And I'm just going to read it because this is really key. In 2016, Disney told the state of Georgia, we will plan to take our business elsewhere should any legislation allowing discriminatory practices be signed into state law in response to the controversial religious liberty bill. By taking a stand, Disney directly affected the legislative outcome in Georgia. It has been proven that Disney's corporate statements can and do make a difference.

So you see here that what was happening was something more than just an emotional grievance. This letter was actually quite savvy in telegraphing a strategic political goal, and that was something that none of the media coverage that I read picked up on. And it worked. At that point, Chepic didn't only apologize and promise to put out a statement on behalf of the company opposing the Florida legislation. He also promised that Disney would donate money to gay activist groups and stop donating any money to politicians who supported the bill. These were his comments at a shareholders meeting on March 9th.

I know that many are upset that we did not speak out against the bill. I called Governor DeSantis this morning to express our disappointment and concern that if legislation becomes law, it could be used to unfairly target gay, lesbian, non-binary, and transgender kids and families. The governor heard our concerns and agreed to meet with me and LGBTQ plus members of our senior team in Florida to discuss ways to address them. Now, in the past, this kind of thing has worked to sway politicians away from legislation that the LGBT lobby doesn't like.

We saw that last year with Christy Noem and South Dakota when she vetoed a bill that would have kept biological males out of women's and girls' sports, reportedly because of pressure from big corporations. But it appears that this gambit was not effective in swelps. dissentis. Here's what he had to say last Tuesday about Disney's opposition to the bill. I would just tell people it's a free country, but understand if you are out protesting this bill, you are by definition putting yourself in favor of injecting sexual instruction to five, six, and seven-year-old kids. I think most people think that's wrong. I think parents especially

think that's wrong. Well, we know DeSantis in particular has a tendency to be fairly unsweigh, weighed by activist pressure. But could we start seeing more of that? What I mean is, do you perceive there's some building pressure for politicians not to capitulate to activist pressure? You know, yeah, I think you could say there's some evidence for that. One, after a lot of criticism, Nome did eventually sign a different bill to prevent males from competing in female sports. And if you look at Texas, there's been a lot of corporate criticism of Republican Governor Greg Abbott over his order that requires state officials to investigate sex change surgeries and other trans treatments on children as abuse. Yet so far, he doesn't appear to be moving either. And I think what

you can say is that it's kind of an escalating game for activist employees at this point. So if you look at how the Disney story has unfolded, another element that's really interesting here as far as strategy is the fact that the employee walkout protest did go on as planned, despite the fact that Chapic had already capitulated nearly two weeks before that. In fact, LGBT activists within Disney have really gotten even more than they asked for in their list of demands. Pixar announced that it was able to reinsert a same-sex kiss into the animated film Lightyear. Disney leaders held a company-wide town hall last week in which the chief human resource officer promised that the company would, quote, take action against that Texas order.

And yet, the walkout went on. Stay gay, say, day, say, day. So the entire writer's room of the Disney Channel show for Twins, Bunked, announced that they were going to be out of the office to participate in the walkout. And there were what appeared to be coordinated social media posts from Disney-owned streaming platforms and networks, ESPN, Hulu, FX.

All of them seemed intended to support the walkout as they all announced some variation on the theme of supporting human rights for LGBT people and standing against legislation that they claim would harm that group. But again, Disney leadership had already acquiesced to pretty much all of the activist demands and then some before that walkout took place. So you have to ask yourself, what was the purpose of it then? Personally, my analysis is that it was less about getting any further response from Disney than it was about continuing to create a media spectacle. So why would they want to continue this saga if they've already gotten what they want?

I think you could say that we're watching optics that are meant to serve as a warning for other big companies that getting involved in political activism is now a price of doing business. We see that, of course, in a wider corporate trend. And when you say the price of doing business, what do you mean by that? Well, let's consider the reaction of the LGBT activist group, the Human Rights Campaign. Chapic pledged to donate $5 million to them in sort of a penance for his initial refusal to get Disney involved. In the past, that was typically the end of the matter. They would just collect their check.

But here, the human rights campaign made a pretty large show of saying they were going to refuse that money until they saw Disney take more action. Now, the HRC didn't define what action is, but let me read you a part of their statement and see if it doesn't sound familiar. The human rights campaign will not accept this money from Disney until we see them build on their public commitment and work with LGBTQ plus advocates to ensure that dangerous proposals like Florida's Trans Bill don't become dangerous laws. And if they do, to work to get them off the books. This should be the beginning of Disney's advocacy efforts rather than the end. So this is an explicit call for Disney to be involved in ongoing political activism.

Correct. And clearly, they're asking for more than just corporate statements about legislation. They're asking Disney to partner with outside activist organizations to ensure that bills the LGBT lobby doesn't like don't become laws. So they're really directly acknowledging that they want to circumvent the old way of defeating legislation through elections. They're intending to also do it now through corporations. Now, to further flesh that out, the best-known LGBT group in the world, Glad, also under underline this strategy. So in direct response to the Disney story, Glad announced on March 10th that it is now monitoring studios campaign donations and will begin issuing report cards, social credit scores, based on which candidates and political action committees the companies give money to.

It's also going to track, quote, public advocacy efforts from a film studio or parent company around pro-LGBQ or anti-LGBQ legislation. And finally, it said it, going to scrutinize how much advertising companies devote to gay and trans promotion, particularly outside of Pride Month. So as one Glad rep said way back in 2005, and I'm quoting here, the old MO was to wait until something bad happened and get pissed off. But we don't protest anymore. Why stand outside the building when with one phone call we can be invited in? So I think you can say that Glad has been incredibly successful with that aim. And what we seem to be seeing now is a new evolution of the group's strategy that's gone from influencing content

to leveraging the power of corporate America to pursue those political aims. So that's obviously an issue for another time. It gets into trends related to stakeholder capitalism and environmental social and governance investing. But for today, suffice it to say, the Disney story illustrates how a really very small number of employees and activists have been so effective at bending one of the most powerful multinational corporations in the world to their will. Megan, thanks for bringing us this deep dive on Disney.

Absolutely, my pleasure. That was Daily Wire Culture reporter, Megan Basham. And this has been a special edition of Morning Wire. We hope you've enjoyed it this morning. We created this show to bring more balance to the national conversation. If you love our show and you stand with our mission, subscribe and tell a friend. That's all the time we've got this morning.

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