Florida Gov. Ron DeSantis has shown that he's willing to hurt his state in order to make his political points.
The right-wing candidate for the Republican nomination for president has made that very clear in his choice to target Walt Disney (DIS) -), the largest driver of tourism in a state where that's the biggest business.
DeSantis has gone after Disney not because it's unique in its politics but because former Walt Disney (DIS) -) Chief Executive Bob Chapek took a public stand against the governor's so-called Don't Say Gay legislation.
Lots of other companies in Florida -- Starbucks (SBUX) -) and Target (TGT) -) to name two prominent ones -- have been far more openly left-leaning than Disney. But those companies have kept their politics generic and have not specifically gone after DeSantis.
DON'T MISS: Despite DeSantis, Disney and Florida Get Some Very Good News
As part of his efforts to establish his war on woke, the basis of his presidential campaign, DeSantis took over the former Reedy Creek Improvement District, a quasi-government body that governs the land Disney World sits on. That has led to dueling lawsuits over control of the area and it has caused Disney CEO Bob Iger to push back on DeSantis's efforts to target his company.
Iger has said that while Disney can't pull out of Florida, it can choose to spend some of its money elsewhere.
"We have a huge opportunity to continue to invest in Florida. I noted that our plans are to invest $17 billion over the next 10 years, which is what the state should want us to do," he said during the company's second-quarter-earnings call.
Image source: Getty Images.
DeSantis Moves Help California, Gavin Newsom
While Disney will continue to invest in Disney World -- it pretty much has to, given rival Comcast's (CMCSA) -) plan to open a third Florida theme park, Epic Universe, in 2025 -- it does not have to invest as much as it once planned. The company has already canceled a $1 billion headquarters project near Disney World, which would have added more than 2,000 workers currently working in California.
DeSantis has charged that those plans were never real, but Disney had told the California-based employees that they would have to move. Canceling that spending and the workers' move is a blow to Florida and a win for DeSantis's political rival, California Gov. Gavin Newsom.
Newsom, a liberal Democrat, has embraced Disney for the LGBTQ+ values and inclusivity it has supported, which DeSantis has taken issue with. Newsom recently attended Disneyland's Pride Nite and made clear that his rival's open intolerance was making California an attractive place for Disney and other companies to do business.
“In California, we don’t just tolerate our diversity, we celebrate it and all the ways it makes us stronger,” he said in a statement. “Our inclusivity and acceptance attract new talent and ideas that drive our economic growth and make California a hotspot for world-leading companies to grow and prosper.”
Disney Doubles Down on Disneyland
Newsom clearly believes that beyond the headquarters decision, Disney's problems with DeSantis will lead to more investment in California. That's not something the company has openly commented on, but Iger has said that Disney has "more opportunity in California than people are aware.”
There's a real relationship between what's happening in Florida and Disney's investment choices, former Medtronic CEO Bill George told The Guardian.
“DeSantis has done lasting harm to Disney’s investments in Florida," he said.
For Disney, some of its investment choices may simply come down to which state makes it more comfortable to do business. Under the Reedy Creek format, the company essentially governed itself, while in California it has much less land available and has to work with local and state governments.
That's something the company lays out in its "Disneyland Forward" plan, a sort of rolling plan to grow its two California theme parks.
"We want to bring more Disney investment to Anaheim. However, this becomes more challenging under our current approvals and the limited space available in our Parks today. Without updates, new Disney experiences and placemaking, created from our beloved stories, will likely never find their way to the Disneyland Resort as they have to other parks throughout the world," the company said.
Basically, Disney needs zoning changes in order to grow in California, and those seem likely to come from Newsom, who can bring investment to his state at the expense of DeSantis and Florida.
"With DisneylandForward and more flexibility within our existing properties, new lands and adventures like those underway at Tokyo DisneySea and Shanghai Disneyland could inspire new experiences here," the company added.
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