Dean Barber

The Price of Prejudice Looms Large in Texas

In Corporate Site Selection and Economic Development on July 15, 2017 at 11:49 pm

Newton’s third law is: For every action, there is an equal and opposite reaction. This is a truism in the world of physics.

In the world of business and politics, for every action, there is a reaction, which may get loud, public and ugly. And so it is happening in Texas, where I live.

The Texas Legislature meets on Tuesday, in a 30-day special session called by Gov. Greg Abbott, who has laid out 20 issues that he wants state lawmakers to tackle. Included in the governor’s agenda is a North Carolina-style “bathroom bill,” which would limit which restrooms transgender people can use.

The “bathroom bill” failed to advance in the last regular session, which was marred by a shoving match and threatened gunplay. (In their infinite wisdom, legislators did pass a bill allowing feral hog hunting from hot-air balloons.)

A Full-Page AD

IBM, the tech giant that employs more than 10,000 people in Texas, is taking out full-page advertisements today (Sunday, July 16) in The Dallas Morning NewsSan Antonio Express-News and Austin American-Statesman opposing the legislation which the company says discriminates against transgender Texans.

“As one of the largest technology employers in Texas, IBM firmly opposes any measure that would harm the state’s LGBT+ community and make it difficult for businesses to attract and retain talented Texans,” reads the IBM ads. “We urge Gov. [Greg] Abbott and the state legislature to abandon any discriminatory legislation during this special session and ensure Texas remains a welcoming place to live and work.

“No one should face discrimination for being who they are.”

Tech Companies Take a Stand

IBM is not alone in its opposition. In May, other top leaders in tech companies with a presence in Texas sent a letter to Gov. Greg Abbott urging him not to pass discriminatory legislation.

In addition to IBM Chairman Ginni Rometty, the letter was signed by Facebook founder Mark Zuckerberg, Apple CEO Tim Cook, Amazon CEO Jeff Wilke, Microsoft Corp. President Brad Smith and Google CEO Sundar Pichai. The leaders of Dell Technologies, Hewlett Packard Enterprise, Cisco, Silicon Labs, Celanese Corp., GSD&M, Salesforce and Gearbox Software also signed the letter.

“As large employers in the state, we are gravely concerned that any such legislation would deeply tarnish Texas’ reputation as open and friendly to businesses and families,” the CEOs wrote in a letter dated May 27.

The Fallout Has Already Begun

A recently released report by Texas Competes, a coalition of nearly 1,300 employers and chambers of commerce, shows the “bathroom bill” debate generated $216 million in negative publicity for Texas from Jan. 10, 2016, through May 22, 2017.

“HR executives and business leaders voice concern to us when headlines about discrimination dominate the news about Texas,” said Jessica Shortall, managing director of the organization, in a statement. “We cannot maintain the pipeline of talent needed to fuel this state’s economy in the face of national coverage that tells young workers that Texas is in the business of discrimination.”

No Events For You

Both the NFL and NBA have put Texas on notice that the state will be overlooked for future big events if lawmakers pass the bathroom bill.

The American Association of Law Libraries said it can no longer host events in Texas, “due to recent moves by the Legislature to discriminate against LGBTQ people.” The event, which draws 3,000 attendees, has been held in San Antonio twice and is being held in Austin this week.

In a letter last week to Austin Mayor Steve Adler and Tom Noonan, president and CEO of the Austin Convention and Visitors Bureau, AALL President Ronald E. Wheeler Jr. wrote, “We cannot stand by as Texas enacts legislation that discriminates against this vulnerable community.”

The Chamber Speaks Up

Also last week, the Dallas Regional Chamber sent a letter to Abbott and Lt. Gov. Dan Patrick a letter expressing opposition to the legislation. Business leaders from North Texas plan to rally against the bathroom bill at the Capitol when the special session convenes.

“When the Texas Legislature reconvenes in Austin next week, we will continue to stand firm against any discriminatory legislation during this special session — and beyond — that could seriously hinder our ability to attract more companies, jobs, and talent to the Dallas Region,” stated the letter from Chamber President and CEO Dale Petroskey and board chairwoman Hilda Galvan.

Some of Texas’ biggest cities, including Dallas and Austin, have anti-discrimination ordinances that extend protections to transgender people in public spaces.

Billions at Stake

If the Texas bathroom bill became law, the reductions in travel and tourism activity would cost the state almost $3.3 billion per year as well as the loss of over 35,600 full-time jobs, according to the Perryman Group, an economic and financial analysis firm based in Waco.

In an April 24 report to the San Antonio Area Tourism Council, the Perryman Group also estimated annual losses of $176.4 million in state revenue and $84.3 million in local fiscal resources. Eventually, those numbers would grow, to $5.5 billion in gross product per year, almost 59,600 jobs, $295.2 million in annual lost state revenue and $141.1 million in foregone local fiscal resources.

A Pile of Manure

House Speaker Joe Straus, often credited with keeping the bill from becoming law in the last regular session, took a hard swipe last week at his fellow Republican leaders, comparing Gov. Abbott’s special-session agenda to a “pile of manure.”

Straus says Texas is sending the wrong message about its priorities with proposals such as the bathroom bill championed by Lt. Gov. Dan Patrick.

The World According to Patrick

Heavy on hot-button issues which appeal to his evangelical and tea party base, Patrick rejects any and all warnings about the potential cost to businesses, the economy and the Texas brand.

Last year, Patrick said he would not shop at Target after the retailer announced a policy to let customers use the bathroom that corresponds with their gender identity. Patrick criticized those boycotting North Carolina after it adopted a bathroom bill, writing in a Facebook post on April 24, 2016.

“I’m totally disgusted with the threats from sports teams, entertainers, and some major corporations who want to punish cities and states who want to keep men out of ladies rooms,” Patrick wrote. “The world has gone mad, and we must stand and fight.”

Straus is Disgusted

While Patrick is clearly an ideologue, House Speaker Straus is a traditional Texas Republican in that he is moderate and business-oriented. He has openly criticized fellow Republicans for focusing on a bathroom bill instead of putting more than a billion dollars into public schools.

Not only does Straus believe the bathroom bill is bad for business in Texas, but he also has moral objections.

Author Lawrence Wright wrote in The New Yorker that Straus told him about a senator coming to his office with a proposed compromise just before the bathroom bill collapsed in May.

“I’m not a lawyer, but I am a Texan,” said Straus, according to the magazine. “I’m disgusted by all this. Tell the lieutenant governor I don’t want the suicide of a single Texan on my hands.”

And Now My Take

Texas holds a special place in my heart. The Lone Star State means freedom, unending opportunity, personal liberty and a people who value hard work and enterprise.

Taking away freedom and liberty goes against the very promise of Texas, which is precisely why I choose to live here. As Sam Houston said long ago, “Texas has yet to learn submission to any oppression, come from what source it may.”

I think an editorial from the Houston Chronicle said it best, “No one should mess with Texas. Most especially, its politicians.”

I’ll see you down the road.

Dean Barber is the president/CEO of Barber Business Advisors, LLC, a location advisory and economic development consulting firm based in Dallas. BBA helps companies and communities. Mr. Barber is available as a keynotes speaker and can be reached at dbarber@barberadvisors.com

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