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The Right to Choose

Is it wrong for governors to penalize corporations for their political choices?

California Gov. Gavin Newsom. (Photo by Justin Sullivan/Getty Images)

Have you heard about the obnoxious governor who keeps waging culture war against local businesses in hopes of building a national constituency that might elect him president someday?

No, not that one. The other one.

Until this week I hadn’t paid attention to Walgreens’ futile attempt to elegantly navigate America’s byzantine post-Roe legal regime on abortion but was finally awakened to it by—what else?—a Twitter beef. On Monday, California Gov. Gavin Newsom announced on the platform that America’s largest state will no longer do business with its second-largest pharmacy chain.

Oh dear. Facing an intense backlash from furious pro-choicers, Walgreens tried to calm the waters with this delicate statement.

What’s this all about, you ask? It’s complicated.

Dan McLaughlin has covered the ins and outs thoroughly but the simple version is that Walgreens is stuck in a legal no-man’s land on the question of whether it should dispense abortion medication through the mail. In late 2021, Biden’s FDA announced that it would no longer require doctors to administer abortifacients to women in person, insisting that the drugs are safe enough to be taken at home. This year the agency followed up by authorizing mega-pharmacies, not just doctors, to distribute the drugs upon being certified, raising the prospect of a booming national mail-order business in abortion drugs.

Which is tricky in a country where abortion policy is no longer national.

A very old federal law prohibits sending abortion drugs through the mail but a very new interpretation by Biden’s administration contends that that prohibition applies only when the sender intends to do something unlawful. If a pharmacy in a state where abortion is legal sends pills to a consumer in another state where it’s legal, can that be illegal?

Sure can, say numerous Republican state attorneys general. They sent a letter to Walgreens last month warning the company that they’ll enforce the federal statute as it’s written, not as Joe Biden wishes it were written, and of course they’ll enforce their own state bans on sending abortion meds through the mail. Notably, in four states whose AGs signed the letter—Iowa, Montana, Alaska, and Kansas—abortion is still legal. Women there can lawfully terminate their pregnancies, but each state restricts or may soon restrict how those terminations can happen. A doctor performing an abortion? Okay. A pharmacy mailing abortion pills to women? Nope.

How the U.S. Supreme Court might end up cutting through this legal thicket is anyone’s guess, so Walgreens’ lawyers are taking no chances. Recently they informed the Republican attorneys general who signed the letter that the company won’t distribute abortion medication in their states—at all. Not by mail and not at their brick-and-mortar locations, even in the four states where abortion is still allowed. Walgreens is better safe than sorry until John Roberts and the gang sort this out.

Enter Gavin Newsom, who freaked out at the thought of a huge pharmacy chain being cowed into limiting access to abortion in states where the practice remains lawful.

California is pulling back its renewal of a multi-million dollar contract with Walgreens, following the company’s preemptive decision not to dispense the abortion medication Mifepristone in 21 states, including states where abortion remains legal. On Monday, Governor Newsom called for the review of all contracts between the State and Walgreens and today’s announcement is a result of that ongoing review.

“California will not stand by as corporations cave to extremists and cut off critical access to reproductive care and freedom,” said Governor Newsom. “California is on track to be the fourth largest economy in the world and we will leverage our market power to defend the right to choose.”

California had a contract with Walgreens worth $54 million to provide specialty meds to state agencies, primarily the department of corrections. That’s now up in smoke thanks to the governor’s eager culture-war opportunism. And he’s never more eager than on the subject of abortion: This is the same guy who, after Roe fell, proclaimed that his state would become a “sanctuary” for women across the country who want to end their pregnancies, potentially replete with using taxpayer money to pay for their transportation to California. 

Into this legal and moral mess wandered our friend and former (well, still part-time) Dispatch-er David French to make a provocative comparison.

Hmmm. Is Newsom’s gambit analogous to Ron DeSantis’ crusade against Disney in Florida? If so, is it more obnoxious than what DeSantis did or less?

When does a governor cross the line in penalizing a corporation for making choices he disagrees with?

There are meaningful differences between what DeSantis and Newsom have done. Which one you deem worse depends on ….

… I was going to say “depends on how you prioritize different values” but the truth is that for most people it’ll depend on which party they’re registered with.

DeSantis’ retaliation against Disney was a purer act of viewpoint discrimination than Newsom’s retaliation against Walgreens. Disney lost control of its special improvement district in Florida for no grander reason than that it criticized the so-called “Don’t Say Gay” law Republicans passed, the right-wing version of progressive city councils punishing Chick-fil-A for donating to groups that oppose homosexuality and gay marriage. The equivalent in California would be if Walgreens had simply issued a statement supporting the right to life and Newsom had responded by petulantly canceling the state’s business with the company.

In reality, Walgreens’ decision not to sell abortion pills in states that restrict the practice doesn’t reflect a “viewpoint.” It’s a strategy aimed at avoiding criminal liability at a moment of immense legal uncertainty. In that context, I think Newsom’s decision to cancel California’s contract with the company is more strategic than spiteful. He recognizes that, after Roe, both sides of the abortion debate will pressure corporate America to adopt their preferred policies. Newsom saw the needle move toward placating pro-lifers after the Republican state AGs sent their letter, so he’s using financial pressure to move it back toward pro-choicers.

DeSantis was more aggressive than Newsom, too. As one Twitter user said of the two men’s tactics, “One is taking control, the other is walking away.” Americans are used to the idea of declining to do business with a company whose policies one disapproves of; it’s standard practice among consumers and therefore familiar, although dicey when practiced by state actors bound by law to respect free speech. DeSantis, however, went beyond cutting business ties with Disney. By seizing control of the company’s improvement district, he gave his appointed cronies direct authority over some of Disney’s business practices. And not just its theme park: Remember, he said recently that he hopes the new land-use board he’s installed at Disney World will also have input into how family-friendly Disney’s entertainment is.

If Newsom had sought to punish Walgreens by, say, naming a special building inspector who’s answerable only to the governor to police all of the company’s locations in California, that would be closer to the mark.

Finally, there’s a sense of vindictiveness in what DeSantis did that’s absent in Newsom’s case because it was DeSantis’ own policy that Disney had the temerity to criticize. Newsom’s spat with Walgreens over abortion drugs doesn’t directly involve California; he objects in principle to the idea that women should be denied abortifacients at the local pharmacy in states where abortion is legal. An analogous situation in DeSantis’ case would be if gun dealers in blue states had scaled back sales there rather than challenge strict new gun-control laws passed by those states. “Florida doesn’t want to do business with companies that won’t defend their rights,” DeSantis might say before canceling some contract his state has with gun manufacturers.

That would be a principled reply to questionable state action. In the Disney kerfuffle, there’s really no principle at stake larger than “woke corporations aren’t going to criticize my policies and get away with it.” DeSantis got behind the “Don’t Say Gay” law, he felt angry and anxious when Florida’s most influential company took sides against him, so he seized the chance to go on offense and show right-wing populists that he’s willing to abuse state power to own the libs.

So much for why DeSantis is worse. What about Newsom?

That case starts here: Why is the governor of California sticking his nose into an abortion dispute that has nothing to do with California? 

Whatever one thinks of DeSantis vs. Disney, it’s par for the course to have governors and major companies in their own state wrangle over this or that. By intruding into Walgreens’ legal conundrum in red states and throwing around California’s enormous economic weight, Newsom is disrupting the post-Roe paradigm of letting a thousand (well, 50) federalist flowers bloom. Implicitly his message to American businesses is that they can submit to the pro-life policies that govern red states or they can do business with the world’s soon-to-be fourth-biggest economy but they can’t do both.

Er, why not?

McLaughlin remembered how harshly the governor criticized DeSantis last year for punishing Disney and had to laugh at his reversion to form this week. Applying political pressure to companies is par for the course for Newsom.

Did Newsom mean that governments shouldn’t pressure businesses? Of course not — it’s his favorite thing to do. The actual principle at work is consistent, it’s just not what his rhetoric suggests. Liberal and progressive state governments have made an art form out of using their power as regulators, investors, and customers not just to get big corporations to do their bidding, but to weaponize those corporations against other states and the right of the people in those states to govern themselves. For example, the California State Teachers’ Retirement System (CalSTRS), the nation’s second-largest pension fund, has tried to use its leverage as a government entity managing the retirement funds of public employees to pressure retailers to follow California’s gun laws in states other than California regardless of the wishes of those states’ voters. This is a direct assault on democracy, and on the fundamental bargain of our federalist Union that states do not seek to govern other states.

His decision to tear up California’s contract with Walgreens smacks of a so-called “cancellation” campaign aimed at red states that limit distribution of abortifacients within their borders. You can’t cancel a state government but you can certainly use your platform as governor of America’s blue economic behemoth to encourage boycotts, explicit or symbolic, to make them change their policies.

One can view Newsom’s action as a logical continuation of California’s policy of barring public-funded travel by officials to nearly half of the 50 states on grounds that those states “support or finance discrimination against lesbian, gay, bisexual, and transgender people.” Red-state laws that offend progressive cultural sensibilities have been grounds for economic retaliation by California’s government for some time now, in other words; as one Dispatch colleague told me this morning, it sure is rich that he would be offended by Walgreens’ right to choose which states it does business with when California has exercised its own right in that regard so noisily.

The novelty in this case is that he’s targeting a company that’s subject to the state laws he disagrees with rather than targeting the states themselves. And to what end? Does he want Walgreens to pull out of red states entirely in protest? Or does he want the company to stay put, brazenly break local laws, and hope that it doesn’t get indicted? Does he intend to have California indemnify Walgreens for any fines or civil judgments against it? He’s penalizing a business for a position it’s essentially been forced to take, and which every other national pharmacy chain will be forced to take in time. There’s nothing fair, let alone sensible, about that.

What he seems to find intolerable isn’t Walgreens’ actions so much as the underlying reality that conservative state legislatures are now free to limit abortion without legal obstruction. I recognize that he’s broken up by the fact that the rules on abortion are no longer set by nine judges in Washington, but Americans will not co-exist easily if they’re effectively being ruled by Sacramento.

As for the prospect that a national pharmacy might be strong-armed by red states into refusing to carry abortifacients anywhere in the United States, including blue states: Please. There’s zero risk of it happening. Newsom can tell himself that he’s preemptively defending his own residents’ access to abortion drugs by weighing in on this dispute, but Walgreens isn’t about to leave California’s money on the table because it fears losing business in Wyoming instead.

The optimal policy for how states should conduct themselves toward each other’s rules on abortion is “live and let live.” (“Live and let die” in the case of pro-choice states, perhaps?) Respect the laws enacted by the majorities of each jurisdiction, whatever moral qualms one may have about the other. Federalism is the only way to accommodate sharp differences of opinion on this.

Well, the only way besides that other way.

But that’s too glib. The reason abortion pills are an early flashpoint between progressives and conservatives is that they obviously threaten the ability of pro-life states to enforce their own laws. Mere months after Roe was overturned, news stories described underground networks springing up to traffic abortifacients from Mexico into red states where abortion is banned. That problem will get much worse for obvious reasons once mega-pharmacies like Walgreens are certified to begin handing them out in blue states, particularly if the courts side with Team Biden on their right to do so through the mail.

Wherever you land on the question of Newsom vs. DeSantis, then, spare a thought for Walgreens and other companies who are destined to infuriate activists on both sides as they try to adjust their business practices to an America where abortion rules are no longer uniform. Pharmacies that lean too far toward caution in distributing drugs will earn the wrath of Gavin Newsom; those that lean too far toward distributing them freely might draw the scorn of Gov. (President?) DeSantis. A Supreme Court that finally ended one long, agonizing line of abortion jurisprudence with the Dobbs decision last year will soon find another long, agonizing one related to interstate abortion disputes newly in bloom.

And meanwhile both parties will try to exploit their power within the federal government to override state abortion laws they disfavor with national laws that are more to their liking.

But hey. Democracy is supposed to be messy, right?

This is going to be messy.

Nick Catoggio is a staff writer at The Dispatch and is based in Texas. Prior to joining the company in 2022, he spent 16 years gradually alienating a populist readership at Hot Air. When Nick isn’t busy writing a daily newsletter on politics, he’s … probably planning the next day’s newsletter.