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The economic effects of so-called “religious freedom” laws

On Wednesday, March 23, the North Carolina General Assembly surprised many of us with a truly radical bill, HB2, which bars anti-discrimination bills passed by local governments. Yes, I said that correctly. This is an anti-anti-discrimination bill, and if I remember the transitive property correctly, that would make it a pro-discrimination bill. There is not even a pretense of religious views required for businesses to discriminate on the basis of gender, gender identity, sexual orientation, etc. And to make sure it slipped past any possible opposition, it was introduced in the morning, passed by both houses in an “emergency session” with virtually no Democratic support (Senate Democrats walked out of the session), and signed by Governor Pat McCrory, elected  four years ago as a “moderate” pro-business Republican, that same night. Oh, and while they were at it, they threw in a prohibition on local increases in the minimum wage. Let the backlash begin…

The next day (today), APM’s Marketplace covered a story on a similar, albeit less extreme, version of this type of bill recently passed by the Georgia legislature. This one, like many others recently proposed and/or passed, merely allows businesses to discriminate in their hiring and service provision based on their stated religious views. And now, media companies like Viacom, Disney, Sony and Lionsgate are threatening to stop filming in Georgia if Governor Nathan Deal (R) signs it into law.

This is a big deal, folks. Deal and the Republican lawmakers in the majority have touted the success of their 30% tax incentives for film productions as having brought billions of dollars to the state’s GDP, but by catering to a vocal minority, and of course the American Legislative Exchange Council (ALEC), they threaten to reverse those gains.

And it’s not just those “Hollywood liberals” who are concerned. Opponents also include Coca-Cola, Delta Airlines, and that notoriously left-wing organization, the National Football League, which has threatened to withhold a future Super Bowl if the bill goes into effect. And this lesson goes even further. Georgia has been trying to grow its biotechnology sector, but at the same time passed incredibly restrictive laws regulating various kinds of research and the handling fetal stem cells for that research. How do they possibly hope to have it both ways?

In North Carolina, leading businesses like Dow, Redhat and Biogen have also been outspoken in their opposition to HB2, with tweets like this from Redhat President & CEO Jim Whitehurst: “At we strongly value diversity: http://red.ht/1MCUERn . HB#2 is a clear step backwards. Sad day.

I hope that North Carolina, my current residence, and Georgia, my previous residence, wake up in time to realize that bills fostering bigotry and discrimination aren’t just bad for democracy, they’re bad for business. Times have changed since the Jim Crow era, and businesses know that they lose a huge competitive advantage in hiring if they can’t get top talent to move to as state perceived as bigoted and backward. These regressive laws might help consolidate the base voters (in both senses of that word), but they are most certainly bad for business.

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