Only a few years after “woke capitalism” was touted as the wave of the future, its supporters are getting a wakeup call of their own.

Just ask BlackRock CEO Larry Fink. The tone of his 2022 letter to CEOs is very different from his previous two, both of which pushed Environmental, Social and Governance (ESG) investment criteria and “stakeholder capitalism” relentlessly. As far as Fink was concerned, ESG, “sustainability,” and the agenda for what we have termed “woke capital” would dominate the markets for years, while he and his $10 trillion asset management behemoth would, in turn, dominate them. Fink was to be king of the stakeholder world.

But then something fascinating happened.

Shortly after Fink’s triumphant 2021 letter, Encounter Books published “The Dictatorship of Woke Capital.” The book turned out to be the tip of the proverbial iceberg, heralding a massive backlash that was already building against ESG, woke capital, and the hubris that animates top-down, anti-democratic efforts to undermine free-market capitalism for partisan ideological ends.

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By year’s end, the resistance to ESG and woke capital had increased in size and variety. Everyone from shareholder activists to U.S. senators, state treasurers, legislators, and governors, as well as the former director of “sustainable investing” for BlackRock itself—were charting various forms of pushback against the newly woke masters of the financial universe.

State officials, in particular, have started resisting the notion that unelected and unaccountable functionaries—such as Fink, World Economic Forum executive chairman Klaus Schwab, Federal Reserve Bank Governor Lael Brainard, or SEC Chairman Gary Gensler—can legitimately substitute their progressive beliefs and fixations for the will of the American people.

For example, Texas has enacted legislation banning companies that engage in political vendettas against oil and gas or gun companies from doing business with the state. Lt. Gov. Dan Patrick has asked the state’s comptroller to place BlackRock on this list of banned companies. West Virginia Treasurer Riley Moore announced that the Board of Treasury Investments, which manages the state’s roughly $8 billion operating funds, will cease doing business with BlackRock because it embraces “‘net zero’ investment strategies” that harm the energy sector, “while increasing investments in Chinese companies.”

“[T]o combat woke corporate ideology,” Florida Gov. Ron DeSantis and the trustees for the State Board of Administration voted to “clarify the state’s expectation that all fund managers should act solely in the financial interest of the state’s funds” and revoked “all proxy voting authority of outside fund managers,” including BlackRock. The board also voted to conduct a survey “to determine how many assets the state has in Chinese companies.”

Fink has apparently noticed. Faced with this opposition, he is attempting to reposition his efforts, disingenuously titling his 2022 CEO letter “The Power of Capitalism.” To bolster that attempt at rebranding what he does, Fink now defines “stakeholder capitalism” as “real” capitalism. News flash—it’s not.

Anyone who has ever owned, managed, worked for, or purchased something from a business knows that employees, customers, suppliers, local communities, and other stakeholders matter to success. But with “real” capitalism—traditionally defined—the goal is financial, not ideological, success. The result of that focus on profits is broad-based prosperity and abundance.

Even Fink’s insistence that U.S. corporate managers need his help to understand their stakeholder responsibilities is a ruse designed to empower elites to remake society in their own vision. Fink’s version of “stakeholder capitalism” attempts to redirect management’s focus from financial success to meeting radical environmental and social policy goals.

Fink’s entire “stakeholder capitalism” pitch is transparently political, particularly given BlackRock’s foray into China. Does anyone seriously believe that Chinese companies are less in need of Fink’s sage advice on stakeholder responsibilities than American companies? Does anyone believe they’ll get it?

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Fink’s letter does attempt to make the case for empowering elites. When he writes that the world desperately needs consistency “for sustainability policy, regulation, and disclosure across markets,” he is actually arguing that unaccountable federal bureaucrats—and even less-accountable global economic forums—should provide guidance, that businesses should provide compliance (regardless of the costs), and that the general population should stand aside and accept whatever its betters say is necessary.

It’s certainly a positive development that some states are reacting to this attack on free market capitalism. But while necessary, none of these state actions is ideal. The better idea would be to get politics out of business, not to turn capital markets into a partisan or ideological battleground. Nevertheless, only by imposing real financial costs on Fink and his ilk is it possible to force the changes needed. This has been the culture war’s pattern since the dawn of progressivism.

Convinced that the people are incapable of governing themselves, progressives try to change or hijack a formerly private sphere of life. Then, when the people and their elected representatives turn out to resent this usurpation of their rights, progressives cry out against this opposition, which they deride as “politics.” Despite what he says, Larry Fink does believe he should be the “climate police” (or the “diversity police,” or whatever). Now that he’s been called on it, he advances the fantasy that his crusade is about “stewardship,” not politics.

Thankfully, a full-blown resistance movement is blossoming to make just that case to markets, managers, and governments—on behalf of the American people.