The problem with the "let the market sort it out" argument is essentially this: we don't live in a complete market economy.
Companies that engage in social activism can do so for one of three reasons. The first is that they might get some sort of grant/tax break to do so. The second is that they can make enough money in another area of their business such that they can take a loss in a different area to "do the right thing". Remember when a shareholder of Apple had the audacity to ask the CEO what environmental activism would do to the share price? Tim Cook basically said,
"Fuck of you Neanderthal" and it was like the Second Coming of Christ. The whole reason he can afford to do that is because Apple is rolling in cash. Cynically, we might even say that he doesn't really give a shit about the environment, but knows exactly which buttons to push to get the hipster/Baby Boomer wanker crowd to go out and buy the latest mePhone. That leads into the third reason. From a purely business point of view, it might hurt a company to do X, but if social justice warriors make enough noise, it might hurt the company even more
not to do X. In some sense, that is the market speaking, but in another sense, it's rent-seeking/a shake down that distorts the market.
The other big factor in all of this is that we have many "public goods" that don't actually make money. Your local park would be an example of this. Most people would say that's apolitical. A local arts programme might be somewhat more political. A sociology department at the local university would be even more political. The point is though that if someone can position an issue as being about a "public good" then they can argue that it has value beyond the economics involved. This is exactly what SJWs do when they talk of diversity and representation.
Others have pointed out how cultural Marxists have taken over the institutions (and this was planned decades ago by people like Gramsci). Often, it's really subtle. It's as much about what and how much they put in as it is about what and how much they leave out.
Many years ago, when I was teaching in England, I did a contract for six months where I taught psychology and sociology to students in the last two years of school. I'd previously had no contact with sociology, so the batshit crazy nature of it was somewhat of a surprise to me. Anyway, the curriculum basically involved looking at various things in society (the family, the education system, etc.) through different perspectives. A massive amount of time was devoted to Marxist and feminist perspectives, and then a few others, none of which could even remotely have been considered right wing. Even neo-liberalism, which is not exactly right wing, was literally given two sentences at the end of the book.
The entire curriculum was a crock of shit, pushed down the throats of impressionable students, most of whom actually knew very little about the world and weren't particularly critically minded. The problem with me even beginning to push back against this was twofold. The basic problem I encountered was simply that there was a ton of material to cover, and a lot of it was over the heads of my students. Any time I spent pushing back was time I couldn't devote to covering the material, which would have left my students in a bad position. I believe that was entirely by design. The second issue, of course, is one of an appeal to authority. Sure, you can try to push back, but if the textbook says something else, then to some extent, you're either going to look incompetent or like some sort of kook with an agenda. Again, I believe that's by design.
Later, in Australia, I taught history at what would be junior high school level in the U.S. Previously, history might have been taught as the glories of Western civilisation, rah, rah. I personally think that's a good thing. In that curriculum it wasn't so much ideological on a surface level, but again, I think something was definitely going on there. Kids did a unit on the life of a Roman peasant, a medieval European peasant, a medieval Chinese peasant, etc., and a few things about the structures of those societies, maybe mention of a famous building or invention. It was all presented as some sort of grab bag of this or that. Most kids came out of there none the wiser as to what it all meant, if it formed some sort of continuum, if the past informed the present, etc. Those who might have thought a little more would have come away with the impression that it was all the same. After all, if the book showed three inventions from Culture X and three from Culture Y, then all cultures are the same right? Of course, that is then placed in stark contrast to the units on "modern" history where it's all about white men killing and poisoning the natives, and absolutely no mention of them raising their life expectancies through breakthroughs in science and technology. The end result? At best, kids come out of the education system clueless and with no particular affinity with, or love for, their culture. At worst, they've been primed for all of the shit that comes later, particularly at university.
The cultural Marxists know that this is how you do things. You control the narrative and you control the outcome. If you "educate" the children, you control the future of the society. Anyone who thinks that they're not trying exactly the same strategy that they have been implementing extremely successfully for at least half a century elsewhere is extremely naive. It's not about them having their spaces. They want every space. If you create a new space, they will try to move into that. If you abandon it and create a new space, they will try to move into that. They will pursue you until there is no sanctuary left. You are not allowed your own space because your own space is evil, and they can't allow that, even in private.