How Likely Is a Boycott in Indiana to Be Effective?

Photo by Chip Somodevilla/Getty Images

Photo by Chip Somodevilla/Getty Images

Indiana’s Governor, Mike Pence, has been on the defensive ever since he signed the Religious Freedom Restoration Act into law. The legislation makes it legal for Indiana businesses to refuse service based on religious motivations and has been taken by critics as an attack on same-sex couples and the LGBT community. Quickly following the law’s passage, an eruption of political and business responses resulted.

Many businesses threatened (or promised) to move investment elsewhere, including Yelp, Salesforce, Lilly, and a number of others. Major sports organizations, including NASCAR, the NBA, the WNBA, and the NCAA all made it clear that they took issue with the law and might consider holding events elsewhere if it proved to be a problem. One enormous annual gaming convention hosted by Gen Con on a yearly basis in Indianapolis may be moved as a result for future years. The one thing that all of these and other companies stress is the financial loss and the investment losses Indiana will be seeing from their companies.

The strategy is similar to that seen in apartheid South Africa and the south before civil rights took hold. Economic punishment can be a very effective deterrent and motivation for change. It can also come from political sources, not just businesses boycotting activity in a state. “Believe me, I am going to rip — try to rip the economic guts out of Indiana,” said Illinois Gov. Bruce Rauner, according to the Indy Star, in perhaps one of the bluntest examples. “I am one of the baddest, you know, enemies anybody can have. And when I set a goal, we do it. I don’t care what the headline is. I want the results. And we’re coming after Indiana big time,” he said. Rauner added that this would be done on Illinois’ “own terms” in the “right way.”

Given the historic effectiveness of an economic strategy, it’s understandable that this is what states, businesses, and people are doing in protest of SB101. But how effective will it really be?

That’s the question that, for those affected by the law, will really count. Gov. Pence called on the state legislature to offer a clarification bill on the law, which he signed, but he has given no indication that he’ll be going back on his decision. “There’ll be some who think bill goes too far, some who think it doesn’t go far enough,” tweeted Pence on the clarifying bill. “As governor, I must always put the interest of IN 1st.” He also re-tweeted the following bit of news about  Illinois-based business headed for Indiana:

So how effective could this boycott be, really? FiveThirtyEight classifies future boycotts as likely being solely dependent on boycott by “proxy” with businesses and sport organizations being the main force, rather than normal citizens as we saw in past boycotts mentioned, like boycotts in South Africa.

It took a look at five boycotts that “Most closely resemble the proposed boycott of Indiana” and found that often they went on for extended periods, but were unable to do enough damage to result in reversals within a reasonable time, with one success in Arizona possibly the result of changing opinions over time, rather than the boycott. That being said, its arguable that the publicity and attention boycotts and businesses, celebrity, and political speech bring to the issue helps to speed along this social change and alteration of public opinion. If business concerns were going to have an effect, it would seem more likely to have had an effect prior to the passage, rather than after — as was the case when Arizona’s governor vetoed a similar law to Indiana’s. There’s also the potential problem of follow-through on the part of businesses that threatened to move their investments elsewhere. Some have committed fully, but others have worded their critical letters to the state more carefully, saying it would be added into their consideration of whether or not to return their business to the state, but not outright guaranteeing the loss of their business.

The Communications Director for Gov. Pence, Christy Denault, also claims that this sort of business loss can be combated in other ways. “We’ll stack Indiana’s low taxes, triple A credit rating, and excellent business climate against those of any other state any time,” said Denault according to the Indy Star. “Our corporate taxes are going down, our workforce has been growing, and we will continue to aggressively recruit new companies and new jobs to our state.” Likely time will give us a better idea of how serious companies are, and how costly these boycotts can be, but for the moment, companies have certainly succeeded in drawing attention to the issue at hand.

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