The Reformed Advisor

Economics 101: Discrimination is Fundamental to a Free Market Economy

Posted on January 3, 2018 in Money, Public Policy, Religious Freedom by

Jack PhillipsAt one time I thought the case of a baker refusing to bake a cake for a gay wedding was about religious freedom. Now I know it’s about more than that.

The case known as Masterpeice Cakeshop V. Colorado Civil Rights Commission is, perhaps, the biggest case to appear before the Supreme Court this year. The case is so big that rather than taking only the customary 60 minutes for oral arguments, the case took 90 minutes of the court’s time. That’s not insignificant as it signals, on the part of the court, how important this case is.

In days leading up to the Supreme Court oral arguments, the contention that this is a religious freedom case was made loud and clear. I sympathize with those making this argument, but, must respectfully disagree. If this is a religious freedom case it is misunderstood and its outcome will be limited.

Let’s make sure we are clear on the material facts of the case.

Jack Phillips, owner of the bakery, was asked to bake a cake celebrating a same-sex wedding. He respectfully declined, citing his religious convictions. Phillips was sued and, eventually, found guilty of discrimination. The long appeals process has brought us to the Supreme Court where Jack’s lawyers have argued that Jack is an artist and, like any artist, retains the right to decide what art he will and will not create. Jack’s lawyers have furthermore argued that forcing Jack to bake a cake celebrating something he is convictionally opposed to would be a violation of his religious freedom.

For the most part, Jack’s legal team has maintained that this is a free-speech case with a large dose of religious freedom mixed in. And, while these elements are present and should be considered, this case is, I believe, primarily about private property rights of individuals.

From the beginning Jack Phillips has maintained that he does not discriminate against people (people being the key word). Jack has served people from all walks of life and happily serves them regardless of who they are or what they believe. However, Jack has also maintained that he has – from the very start of his business – refused to bake cakes affirming or supporting messages that violate his convictions. He recently reiterated this fact, saying:

“Though I serve everyone who comes into my shop, like many other creative professionals, I don’t create custom designs for events or messages that conflict with my conscience. I don’t create cakes that celebrate Halloween, promote sexual or anti-American themes, or disparage people, including individuals who identify as LGBT. For me, it’s never about the person making the request. It’s about the message the person wants the cake to communicate.”

There it is again: it’s not about the person, it’s about the message. Once again, this might sound like a free speech case (and there’s an element of that here) but this is about private property rights. So far Jack has proven over many years that he is willing to serve any person. However, he is not willing to promote every message. That is a value every free person holds dear. The Jewish person does not want to be forced to promote Naziism. The African-American does not want to be forced to promote white supremacy. Are you seeing the point? Every person has the right to discriminate based on his or her sincerely held convictions. Yep, you read that right, we all have the right to discriminate.

An article recently pointed out that the only reason this is even a case is because our country has forgotten the “right to discriminate.”

“The legal controversy vexing all these great legal minds is a classic example of what happens when the courts compromise (i.e., abandon) the principles of freedom. When that happens, it produces situations where lawyers are “vexed” and end up doing their best to pound square legal pegs into round legal holes. The fact is that the wedding cake controversy has nothing to do with free speech. Instead, the issue is all about private property and the right to discriminate.”

Ever day we make decisions that are nothing less than discrimination. We support one business because they support a cause we hold dear. We boycott another business because they support (or don’t support) a cause we hold dear. We have just engaged in the best kind of discrimination. Business owners are no different. Just as every individual has the right to discriminate, so too business owners have the same right. This is what creates a healthy economy.

When people discriminate against a business (typically by boycotting it) because it supports a cause we oppose, we are engaging in a free-market exercise that has held true for centuries. We are, furthermore, giving the business owner an opportunity to decide whether he or she wants to make a strategic business decision or not. Does the business owner want to begin supporting our cause and end our boycott, or not? The previously cited article goes on to expound this idea:

“Bakers have the right to bake a cake for whomever they want and for whatever reason they want. It might well be that they hate blacks, Jews, immigrants, and poor people. Motive doesn’t matter. What matters is that under principles of liberty and private property, private business owners have as much right to discriminate as private homeowners. By the same token, consumers have the right to boycott the business that is discriminating against others and to advocate that other people boycott it as well. That’s how the free market deals with businesses that people perceive are wrongfully discriminating against others. It nudges them to change their position through loss of sales revenues rather than force them to do so with the power of a government gun.”

Ron Paul wrote an article explaining this very principle and the fact that even if the baker was a bigot that hated gay people, he has a right to discriminate:

“Some people claim that forcing the bakery to bake the cake is consistent with libertarianism. The reason they make this claim is they view the bakery’s actions as rooted in bigotry toward homosexuals. But even if this were true, it would not justify government intervention. Bigots and others with distasteful views have the right to use their property as they choose. The way to combat bigotry is through boycotts and other means of peaceful persuasion.”

The truth is that if we don’t have the right to discriminate, we aren’t free. There might be the illusion of freedom, but we aren’t really free (and neither is our marketplace). For freedom (and the economy) to thrive, people, including business owners, need the right to discriminate. Consider some of the headlines of the last few years:

Gay baker refuses to make traditional marriage cake.
Designers refusing to dress Melania Trump
Muslim baker refuses to bake gay wedding cake.

Should a gay baker be forced to bake a cake supporting a message he opposes? Should a designer be forced to create clothing for a person (and message) she opposes? Should a Muslim be forced to violate his convictions? You can’t support any of these people without supporting the right of the Christian business owner to refuse service based on his convictions. But even if you take religion out of the equation, by applying the freedom of property rights to this argument we arrive at a conclusion in which every person has the right to live and do business according to their sincerely held convictions (not just Christians).

Thankfully, some of the comments by Supreme Court justices during the oral arguments indicate that they are leaning towards defending the rights of every citizen:

“Justice Alito noted that according to the state of Colorado, a baker who supports same-sex marriage can refuse to create a cake with a message that is opposed to same-sex marriage. ‘But when the tables are turned and you have the baker who opposes same-sex marriage…that baker may be compelled to create a cake that expresses approval of same-sex marriage.’”

“'[T]olerance is essential in a free society,’ said Kennedy, ‘And tolerance is most meaningful when it’s mutual. It seems to me that the state in its position here has been neither tolerant nor respectful of Mr. Phillips’ religious beliefs.’”

Let’s sum this up: no one should be forced to use their private property to support or affirm a message that he or she disagrees with. The motive behind their disagreement doesn’t matter; whether it is religious or person. No person, company, business owner, or citizen should be forced to violate their convictions. I support the right of the Muslim to refuse to serve pork products. I support the right of the black photographer to refuse to photograph the KKK rally. I support the right of the gay baker to refuse to bake a cake opposing same-sex marriage. And I support the right of the Christian baker, florist, and photographer to refuse to violate their convictions.

Property rights. We all have them and, when applied properly, defend the rights of all people and not just a select group.

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