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Capitalism Beats Back Bigotry

When Jan Brewer vetoed SB 1062, Arizona's now infamous homophobic "religious-freedom" bill, she kept her state (relatively) safe for gay people and satisfied business interests. The system works!
February 27, 2014, 8:45pm

Jan Brewer just made businesses and gay people very happy. Photo via Flickr user Gage Skidmore

Yesterday, Arizona Governor Jan Brewer vetoed SB 1062, the terrible, no good, very bad bill that would have essentially provided some legal protection to religious people who wanted to use their faith as an excuse to deny goods or services to gay people. There were a lot of issues with SB 1062—it was really broadly worded, for one thing, to the point where one writer at the American Conservative thought it might “legalize polygamy and marriage with underage girls”—but its actual content was less important than what it signaled to the world at large. Had it gone into law, it would have amounted to a giant sign that said, “Hey, everyone! We’re the great state of Arizona, and we’re incredibly intolerant of gay people!”


The sheer moral ugliness of the bill, which was pretty clearly crafted by homophobic bigots, wasn’t enough to stop it from passing narrowly in both houses of Arizona’s legislature. After all, this is a state where Sheriff Joe Arpaio, a racist fearmonger who sucks at his job, keeps getting reelected—Arizona has no shortage of what for a lack of a better term I’ll call “shitty, ignorant bigots” or lawmakers eager to appease that section of the electorate. But what happened after the bill passed the legislature but before Brewer’s veto is pretty interesting: Basically, America’s corporations overruled Arizona’s lawmakers.

Small businesses in Arizona spoke out against the bill, noting that it would allow individual employees to refuse service to paying customers and claim that their religion commanded them to. The tourism industry panicked at the prospect of the state's being known for homophobia—especially since it’s already passed a strict immigration law that resulted in a bunch of boycotts—and 80 businesses and groups signed a letter that said, “When the Legislature passes bills like this, it creates a reputation that Arizona is judgmental and unwelcoming.” Big companies, including Apple and American Airlines, said that if the bill weren’t vetoed it could scare business away. Major sports leagues spoke out as well—the National Football League even hinted it might take away the 2015 Super Bowl from Arizona if SB 1062 went on the books. The pressure got so strong that earlier this week, three Republican state senators who voted for the bill came out against it, saying that they “strongly condemn discrimination in any form.” (If those three guys had voted against the bill in the first place, it never would have made it to Brewer's desk.)


Those three flip-flopping lawmakers were so caught up in scoring political points with the conservative evangelical crowd by supporting SB 1062, they didn’t realize that they were pissing off the GOP’s other major constituency: big business. That corporate America would come into conflict with the vicious anti-gay lobby is no surprise, however. The free market that conservatives are always bloviating about is actually pretty good at squashing bigotry—or it would be if people let it.

People don't like visiting places where there’s a lot of horrifically intolerant stuff going on, which is one reason Iran’s tourism industry has suffered for the past few decades. Businesses, even the ones that don’t think much about ethics or morality, don’t want to deal with a bunch of complicated, discriminatory laws that might result in customers or employees filing lawsuits, or activists organizing boycotts. Then there’s the cost of prejudice on a broader economic scale—capitalism is supposed to force people to get along for the sake of making money, and when individuals and businesses let skin color or gender or religion get in the way, they lose. As an article in Time magazine last year said,

Economists see discrimination as a form of economic inefficiency—a massive, systematic misallocation of human resources. Those in the discriminated-against groups can’t bring their full talents to the table, languishing in jobs that are in many ways "beneath them," while less-talented members of more privileged groups take high-powered, high-paying jobs that are beyond their abilities, dragging down everyone with their relative incompetence.


History abounds with examples of how bigotry isn’t just evil but economically disadvantageous. Jewish scientists fled Nazi Germany in the 1930s, and their research benefited their adopted countries. South Africa spent an enormous amount of money maintaining the Apartheid system. In America, Jim Crow set back the economic progress of the Southern states. All of that was awful for the bottom line. Many companies actually opposed Jim Crow laws in the early 20th century on the grounds that they were bad for business—railway operators even refused to comply with segregationist laws that would force black passengers to ride in different train cars from whites. Similarly, in South Africa during that same era, some mine owners laid off whites to hire cheaper black workers; writes economist Linda Gorman: “Higher-paying jobs were reserved for whites only after white workers successfully persuaded the government to place extreme restrictions on blacks’ ability to work.”

Most businesses don’t want to discriminate against gays or anyone else, even if they were given the opportunity to by hateful laws like SB 1062. How many wedding-cake makers can turn down commissions just because the couple in their store has two penises between them? Bigotry is both pathetic and foolish and bigots generally fail in the marketplace—extensive systems of discrimination like Jim Crow and Apartheid have to be imposed by a racist government in order to stay in place.

That’s not to say that SB 1062 is on par with Nazism or Jim Crow. But it was undoubtedly a law that would have been forced on businesses without their consent by lawmakers overly concerned with pandering to a prejudiced minority. Thankfully, Brewer decided that pandering to powerful business interests was more important than appeasing homophobes. The system works! Arizona escaped its self-created crisis and avoided embarrassing itself even more than it already had!

Meanwhile, other states are considering bills that resemble SB 1062, even after seeing the backlash that hit Arizona. Bigots are stupid.

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