What would you do?

Did not read the article's comments section but here are my reactions...(I don't think it will surprise anyone)

1. Interns should be used as "fresh set of eyes" that can question everything. The company should "learn" from the interns as much as the interns are learning from them.
2. The company has exhibited that they cannot accept new ideas (innovate?) or even accept questioning existing norms.
3. The intern program lacks feedback mechanisms. There should have been mechanisms that processes (and deals with) new ideas or questions. If there were feedback mechanisms, the issue (soldier's shoes) could have been explained.
4. The article does NOT indicate the industry. That being said, even JP Morgan (if I remember correctly) who is known for strict dress codes has toned down their dress code. Dress code propriety is changing.
5. The company's reaction was extreme. And could have been dealt with differently. I would have issued a memo/explainer, distributed it to the signatories and at the same time called for the meeting.
6. I am in the camp that dress code (or at least going to the extreme with it) does not result in performance or in this case (internship) learning/experience.
7. It does NOT also say how much they pay their interns (if they even do) or if the company pays for or subsidizes (at least) cost of dress code. If they did, then I would lean with (or side with) the company.

P.S. Having read the few comments, it is clear that there are still a lot with OUTDATED (or have not changed or evolved their) management and business paradigms.

I raised this around the BBQ meal yesterday at home:)

Based on the limited info I would have:
1. read the letter 3x and avoided a response for 24 hours
2. invited the interns to a meeting and open with "I received your letter re our dress code; tell me your rationale about relaxing the code so I can understand it better." Encourage discussion. Try to earn their trust.
3. be open to some ideas that may make sense; avoid belittling them-this is likely their first work experience, so the chances are that they will say things poorly, stumble, be scared of retribution. Try to calm them.
4. Once they have explained their rationale, put forward your rationale for the company policy. Explain that managers sometimes make decisions that are unpopular with some part of the workforce. That’s just life, and I’m not talking about illegal or harassment or discrimination.
5. Conclude the meeting with i)-a thanks for them raising and discussing the issue, ii) listening to both sides and iii) explain your decision to adhere to the policy.

It’s a learning moment for the interns and for managers. Why not use it wisely?
It’s really hard to see how asking about dress code relaxation is a firing matter on its own. Is it really a threat to management's power and authority?

What reputation does that company now have on Glassdoor for example?

I'm sure there are many of us who were taught in business school that what you wear has an influence on how you act. In one class I remember being told that if I had a phone interview, dress as if I were there in person and I would sound more professional over the phone. So, even if the interns didn't meet clients in person, I'm sure they would talk over the phone and how they dressed could influence their interactions.
That said, at one company the dress code became an issue for the workers. They didn't understand the above thinking until I told them about it. Len's thoughts fit this perfectly. We sat down and talked it out. You could physically see the understanding in their faces when I explained the rationale that dress dictates behavior. They went from a little angry over the policy to acceptance in a matter of a minute. I really was a learning moment for all of us involved.

Now if we can only force Mark Zuckerberg to ditch the gray shirt/hoodie...maybe Facebook (or for that matter, the rest of Silicon Valley) would be more successful. (I kid!)

It was JP Morgan...
http://www.wsj.com/articles/j-p-morgan-makes-move-to-business-casual-1464960300

I disagree with the premise that what you wear dictates behaviour (I would even include "ethics"). However, that being said, there is still a certain amount of decorum in the workplace. Management should be able to find the right balance and know what is important and be open to other ideas and change.

As I said....norms are changing.

Page five of my journal of "life-gems" contains the following observations:

1. "The best relationships, whether personal or professional, are those where mutual expectations are clear."

2. "Every environment requires a code of conduct to enter and remain in it."

Ensuring mutual expectations are clear from the outset (e.g. what's negotiable and what's not), can help mitigate these types of issues.

Random Bonus:

2016 entries:

"The difference between successful people and highly successful people is that highly successful people say 'no' to almost everything." -- Warren Buffett

"If you're not at the table, you're on the menu." -- Unknown