The ink barely dried from Governor Mike Pence’s pen when word came that Indiana is already feeling negative economic impacts of a highly controversial bill that would legalize discrimination in the state.
The bill — known as the Religious Freedom Restoration Act — was signed into law today by Governor Pence. It passed the Republican-dominated Indiana House last week in a 63-31 vote after previously passing the Indiana Senate.
Under the new law, it will be legal for a business to deny service based on a religious belief. Critics warn that the broadly-worded law will be used to deny service to gays and other minority groups, and may have other unforeseen consequences.
The national reaction against the bill has been swift and harsh — with economic consequences for the state.
Salesforce, a $4 billion software company that is part of the prestigious S&P 500, says that it will cancel all of its events in Indiana.
“We’ve made significant investments in Indiana. We run major marketing events and conferences there. We’re a major source of income and revenue to the state of Indiana, but we simply cannot support this kind of legislation,” Salesforce CEO Benioff told tech website re/code.
Salesforce has between 2,000 and 3,000 employees in the state. The company holds an annual event known as “Connections” that draws over 10,000 people and $8 million worth of spending to Indianapolis. Last September, the company announced that Connections would be moving to New York City for 2015, although it was possible that it would return to Indiana in the future.
That does not appear to be the case anymore. All of the company’s other events have also been cancelled as a result of the new law.
“We can’t bring our customers or our employees into a situation where they might be discriminated against,” Benioff says. “We have a large number of employees and customers who would be impacted dramatically by this legislation. … I’m really just advocating on their behalf.”
Salesforce is not the only organization reconsidering its relationship with Indiana. The National Collegiate Athletic Association, more commonly known as the NCAA, says that it is “concerned about how this legislation could affect our student-athletes and employees.”
“The NCAA national office and our members are deeply committed to providing an inclusive environment for all our events,” NCAA president Mark Emmert says.
The NCAA Men’s Basketball Final Four and Championship are scheduled to take place in Indianapolis in the next couple weeks. While that event will move forward as planned, the organization hinted that future events may be affected as a result of the law. NCAA headquarters is also located in Indianapolis. This is the 22nd time since 1940 — and perhaps the last — that Indianapolis hosts the college basketball championship.
Max Levchin, a co-founder of Paypal — the online payment transaction business often associated with eBay — also had critical words for the new law.
“What is happening in Indiana is pretty unbelievable,” Levchin wrote in a Tweet. “However it’s dressed up, it’s a signal that discrimination is welcome in this state.”
GenCon, the largest gaming convention in the United States, threatened this week that it would leave Indiana if the bill becomes law. GenCon is also the single largest convention in Indianapolis. More than 56,000 attendees visited the city last year with an economic impact of more than $50 million.
Leaders of the Christian Church Disciples of Christ have also threatened to move a planned Indianapolis convention that would draw at least 6,000 attendees to the Circle City.
“As a Christian church, we are particularly sensitive to the values of the One we follow — one who sat at table with people from all walks of life, and loved them all. Our church is diverse in point of view, but we share a value for an open Lord’s Table,” the church’s leaders said in a letter sent to Governor Pence on Wednesday.
Local reaction has been equally harsh in its condemnation.
South Bend Mayor Pete Buttigieg called the bill “divisive” earlier this week and said that it sends “exactly the wrong message about Indiana’s openness.”
“No one has explained why the Statehouse is focusing on divisive social issues when we have such pressing needs for action on infrastructure, jobs, child protection, and education,” Buttigieg says.
Now that the bill has become law, the St. Joseph County Democratic Party is calling on citizens to boycott any businesses that choose to discriminate against their patrons.
“Personal beliefs are one thing, state sanctioned discrimination is another. The fight over who gets to sit at the lunch counter was won years ago. We have fought the fight against bigotry and hatred before and we will do it again now. If you believe in justice and equality for all, I call on you to join us in this moral obligation,” the county’s party chairman, Jason Critchlow, said in a news release.
The calls for boycotts have likely just begun — and they could have an outsized impact on the state’s economy.
A boycott in Arizona, which passed an anti-immigrant law in 2010, was highly effective. It resulted in $141 million worth of lost attendee conference spending, and a loss of $253 million in economic output in the first year alone.
Image Credit: Flavio Galvao, flickr