Will religious liberty law ding our economy?

Thomas J. Cunningham

As the General Assembly considers the Religious Freedom Restoration Act next year, legislators should enter this debate with their eyes wide open. Based on the experience in Indiana – which passed a nearly identical bill earlier this year – we can safely predict that Georgia would suffer a significant economic backlash if it passed such a bill into law. The impact could include major sporting events like the Super Bowl, conventions, business and workforce attraction and other negative economic consequences.

The negative reaction to Indiana’s law, which many believed would allow business owners to deny service to certain customers based on the owners’ religious beliefs, instantly exploded across the nation.

Wrong economic assumptions about RFRA

Upon signing by the Indiana governor, the state suffered negative stories in the national media, while #BoycottIndiana went viral through social media. More than 1 billion negative social media impressions were counted in the days following the bill’s enactment, which translates into millions of dollars of negative media coverage.

Major conventions and entertainment events previously scheduled in Indianapolis were canceled. Indiana’s WNDU-TV reported that Indianapolis lost $1.5 billion in meetings and conventions in the week that followed the bill signing. The intense national backlash even jeopardized the city’s hosting of the Final Four, which was scheduled for the next weekend.

Indiana’s leaders tried to stop the bleeding. Within a week, the Indiana bill was “fixed” to include language to clarify that the new law could not be used to discriminate against certain classes of people. The media turmoil died down and public backlash subsided, but the damage was already done. Hoosiers continue to suffer blowback and estimates of losses could be greater because analysts cannot know all the instances where Indiana was removed from consideration for major conventions and events, new business investment and large purchasing decisions from corporate customers and suppliers who took their dollars elsewhere.0

Indiana will further consider this issue in its upcoming legislative session, which coincides with Georgia’s legislative session.

While determining a definitive dollar figure for total losses is difficult, it is clear the economic consequences of a RFRA-styled bill are very real. Even conservative estimates of losses offer eye-popping numbers.

In my analysis, enacting a RFRA law in Georgia without any added nondiscrimination language would produce two major monetary risks.

First, Georgia would lose at least $600 million in convention business. This is based on an outcome scaled to that which occurred in Indiana, assuming a minimum of one week’s time following a passage of a RFRA-style bill. Given the most recent data coming from Indiana, this estimate seems extremely conservative. Convention and meeting planners will ask “why take the risk?” if they have a choice between multiple states to host a major conference or event. Georgia’s tourism industry is responsible for around $50 billion in direct, indirect and induced spending and more than 400,000 jobs. Both of these figures represent slightly more than 10 percent of our state’s total economy.

Second, the state would forfeit $400 million from major sporting events – chief among them the Super Bowl. Atlanta is bidding to host the 2019 or 2020 Super Bowl and the selection process coincides with the 2016 Georgia legislative session. Other major sporting events at risk include sponsor-driven events such as NASCAR races and college football and basketball events.

It’s important to note that both of these numbers are intentionally conservative estimates.

Georgia is a large state. The metro Atlanta area economy alone is actually slightly larger than that of the entire state of Indiana.

With a potential economic loss of more than $1 billion in a scenario where the disruption is as short-lived as that in Indiana, the risks are substantial. Understanding real potential risks is a critical part of the decision-making process and no one can plausibly claim they didn’t know what would happen.

Preserving Georgia’s reputation as a welcoming state promotes economic development and new jobs. Losing that reputation does just the opposite.

Thomas J. Cunningham is the chief economist for the Metro Atlanta Chamber.

Wrong assumptions about RFRA

By Josh McKoon

Like the Saturday Night Live character played by Jon Lovitz — who would tell one false and ridiculous story after another punctuated with the tag line “Yeah, yeah, that’s the ticket,” — opponents of religious freedom have come up with their latest whopper to oppose the Religious Freedom Restoration Act.They now claim that a religious freedom law will retard economic development and discourage tourism.

It helps to understand what the Georgia RFRA is and is not. Senate Bill 129 discriminates against no one; it is an anti-discrimination law. It has nothing to do with bakers or florists or same-sex weddings. It applies only to lawsuits brought by or against the state or a local government, and merely ensures the same safeguards protecting the free exercise of religion that have applied to federal laws since 1993 now extend to state and local laws. Namely, that the government may not substantially burden a person's exercise of religion without a compelling governmental interest, and using the least restrictive means of achieving that interest. It protects people of all faiths, including religious minorities.

Twenty-one states currently have RFRAs, including solidly "blue" states such as Illinois, Connecticut and Rhode Island. Twelve other states, including Georgia, are considering them. Georgia's bill tracks the federal RFRA of 1993, which was passed by a wide bipartisan majority.

The two studies claiming Georgia’s economy will be harmed by passage of RFRA are a classic case of the principle of “garbage in, garbage out.”

First there is the “study” focusing on the impact RFRA will have on convention business conducted by the Atlanta Convention and Visitors Bureau. Some meeting planners were asked, would you be less likely to hold a meeting in a state with a religious freedom law that did not have protections for LGBT individuals? Unsurprisingly many responded that, yes, they would be less likely. On top of being a loaded question, the question assumes that religious freedom laws cause discrimination against LGBT individuals, which has never occurred in the 22-year history of RFRA laws.

Four of the top 10 cities for convention planners, according to meetings management company CVent, are located in states with laws identical to the RFRA statute we are trying to pass in Georgia. Five of the top 10 states for expenditures on tourism in 2015, according to CNBC, have RFRA protection identical to what is proposed here in Georgia.

The Metro Atlanta Chamber has conducted a “study” with a core assumption that the proposal in Georgia is the same as the law passed in Indiana earlier this year. Georgia’s law mirrors the federal RFRA, while Indiana chose to initially pass a bill which went beyond the federal language. It is that difference that opponents latched onto and which caused the media firestorm and subsequent negative publicity. Aside from some conclusory statements about negative economic impacts which don’t seem to be extrapolated from any actual data, the “study” seems to focus on negative social media impressions.

What about the Super Bowl and other big ticket events? Atlanta Mayor Kasim Reed and others have suggested that Georgia will lose out on such events if we pass RFRA. Six of the last nine Super Bowls have been played in states with RFRA laws like the one proposed in Georgia. Six of the last nine NCAA National Football Championships have been played in RFRA states.

Even when companies have chosen to locate manufacturing facilities or headquarters in other states, none of these competitive losses have been because of the “threat” of a RFRA in Georgia. Whether Mercedes-Benz in Alabama, BMW and Volvo in South Carolina, or GE, for now, deciding to remain in Connecticut, all have chosen states with an RFRA.

Religious liberty is not at odds with Georgia’s pro-business environment. Rather, a commitment to the right of free exercise reinforces a commitment to free markets and free minds to create opportunity for all.

Sen. Josh McKoon, who represents Georgia’s 29th senatorial district, is the author of the Religious Freedom Restoration Act.