The Price of Exclusion Is High—Like, in the Tens of Millions of Dollars, at Least

If the Indiana state flag stands for discrimination, Americans will spend their money elsewhere.

If the Indiana state flag stands for discrimination, Americans will spend their money elsewhere.

As you may recall, last year Indiana passed a law that made it legal to discriminate against gay people on religious grounds. The response to this law was immediate and overpowering: musicians, consumer groups, and tech industry leaders all called for a boycott of Indiana until the law was repealed. One response to Indiana, written by Civic Ventures heads Nick Hanauer and Zach Silk, made an economic case for inclusion:

Here’s the 21st century reality: inclusion strengthens our country, our institutions, and our economy. And politicians in the twenty-one states fighting to keep their discriminatory marriage practices appear to be totally clueless about how modern technological economies work, and how extreme the competition for talented workers that drive innovation has become.

And now we’ve got proof that exclusion comes with a price. Bryan Slodysko writes for the Associated Press:

Indiana may have lost as much as $60 million in hotel profits, tax revenue and other economic benefits when a dozen groups decided against hosting conventions in Indianapolis last year due at least in part to the controversy surrounding the state’s religious objections law.

A document prepared by the tourism group Visit Indy shows that the 12 out-of-state groups were surveyed and all said that the state’s controversial law played a role in their decision to hold their events elsewhere.

And if you recall, Indiana did an about-face on the discriminatory law very quickly; these losses came after just a few weeks in the national spotlight. The bad press that Indiana absorbed during the whole media uproar will continue to mark the state as a discriminatory, exclusionary place for years to come.

The lesson from Indiana is clear: you can’t just carve out a slice of the population and mark them as acceptable objects of discrimination without repercussions. Hatred and exclusion aren’t just morally abhorrent—they’re economically disastrous.

Paul Constant

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