There’s more than tax breaks to attracting a business to a state. Such as whether that business may have gay employees—even executives—who don’t want to live in a state that treats them as third-class citizens.
That didn’t used to be a problem, when most gay business people were closeted and the same-sex marriage issue was barely on the to-do list of gay rights advocates.
That’s changing now, fast. Seventeen states, including three Midwestern states, recognize same-sex marriage, with more sure to come, possibly this week: a circuit court has stayed until Wednesday the ruling last week by a federal court in Michigan which struck down that state’s constitutional ban on same-sex marriages.
The gay marriage issue points up other problems for more conservative states, including some in the Midwest. How many global companies, especially scientifically-based ones, are anxious to move their operations and employees to states, such as Ohio or Kansas, where the teaching of creationism in schools is still an issue?
Phil Rosenthal, the excellent business columnist for the Chicago Tribune, wrote that Indiana, which brags about its business climate, may be shooting itself in the foot with its attitude toward same-sex marriage.
Indiana already has a law banning same-sex marriages, although challenges to that ban are before courts now. The legislature is debating whether to enshrine that ban into a constitutional amendment, but the state’s rules on amendments make it unlikely that this will pass before 2016. By that time, the issue may be made moot, by court rulings or a surge of common sense among Hoosiers.
The three Midwestern states where same-sex marriage is legal are Iowa, where a state supreme court ruling in 2009 made it the fourth in the nation to legalize these marriages, and Illinois and Minnesota, where legalization passed the legislatures last year.
At least seven Midwestern states have constitutional bans on same-sex marriage—Ohio, Wisconsin, Missouri, and the four Great Plains states of Kansas, Nebraska, and the two Dakotas. The bans in Ohio, Wisconsin, Missouri, and Kansas face court challenges.
A court has ordered Missouri to recognize out-of-state same-sex marriages for tax purposes. In Ohio, a court said that death certificates must list the surviving partner as a spouse, making that Bible-minded state perhaps the only place where the question asked in 1 Corinthians 15:55—“Where, o death, is thy victory?”—is definitively answered.
In the scramble for business investment, this is a new and serious issue. For every Chick-fil-A, there are scores of businesses big and small that take gender discrimination very seriously. For some, no doubt, it’s a matter of conscience. For all, it’s a question of public image, marketing and, not least, keeping employees happy.
For years, Indiana has been campaigning to lure businesses from Illinois next door, comparing its own balanced budget to Illinois’ profligate ways.
But there’s more to life than the bottom line. How many companies will move from Illinois to Indiana, or from Minnesota to South Dakota, if it means that some of their happily-married employees will be living in a legal state of sin?
Corporate America has got the picture. As Phil Rosenthal pointed out, 67 percent of the Fortune 500 companies offer same-sex partner benefits and 61 percent have explicit rules on gender discrimination.
One reason may be that an increasing number of top executives are coming out of the closet. Lord Browne, the former CEO of BP, may have been the first CEO. Tim Cook, the Apple CEO, is often listed among gay executives, a list that includes top executives of Facebook, Google, BP, JPMorgan Chase, HSBC, IBM, and American Express.
For years, CEOs have been moving headquarters from town to town and state to state for purely personal reasons. Would CEOs these days be willing to move their HQ to another state that recognized their marriage as legal? You betcha.
Some states just don’t get it. Apple and Verizon had to lobby Arizona Gov. Jan Brewer hard before she did the right thing and vetoed a law that would have legalized commercial discrimination against gay couples. I’ve talked with Kansas business people who failed to see that the teaching of creationism in schools turns off potential investors whose children would go to those schools.
In Indiana, it’s a struggle. I heard a civic leader in Indianapolis lament that his town wasn’t a “creative city,” as measured by the urban affairs guru Richard Florida, or wasn’t on Florida’s famous “gay index,” which ranks a city’s receptivity to gays. Florida argued that gays themselves aren’t necessarily creative, although many are: rather, he said, creative people like to live in places that actively embrace all lifestyles, and the gay culture is a good way to measure this.
“Indiana just doesn’t have that culture,” my Indianapolis friend said. “He [Florida] says you have to have a culture of embracing difference. Not just a toleration of difference, but rather prizing people because they’re different. Florida’s basis is that you’re excited by the way that people are different from you. You’re glad that some are gay or belong to other races. Indiana isn’t glad. It’s more tolerant than it was when the Ku Klux Klan was here.
“But glad? Not yet.”
It may be getting there. As Rosenthal pointed out, two of Indiana’s biggest companies—Eli Lilly, the pharmaceutical giant, and Cummins, which makes engines—publicly oppose the proposed constitutional ban on same-sex marriage. Both are not only big employers but invaluable corporate citizens and philanthropists, and their voice counts.
Both are basing their argument on hard business principles. As a Cummins executive said, it’s hard to get innovative people to move to intolerant societies. The constitutional ban, she said, tells the world “that Indiana is not a place that welcomes people of all backgrounds and jeopardizes our ability to be competitive in global markets.”