I want to talk about why I am in favour of anti-discrimination laws (some of them, anyway), and how they can be justified given my position that the sole purpose of law should be to make us more free. But first, I'm going to do so by revisiting speed limits, which I've written about before.
On the face of it, a speed limit is an imposition on individual freedom that does not seem to directly protect a greater freedom. True, high speeds might impose a serious liberty-threatening risk on others, but we have tort law for resolving personal wrongs and mandatory vehicle insurance to protect the right of those harmed to compensation. (Not an ideal solution, but a solution that can be refined and improved.) But ignoring for the sake of principle the case of accidents, how does my safely driving at 200 km/h on a public street infringe upon anyone else’s rights, or diminish their freedom?
Well, it doesn't, at least not directly. As I argued before, people driving at excessive speeds use more than their fair share of the road, forcing everyone else to wait longer for a safe opportunity to merge into traffic, make a left turn or otherwise use the road to get where they want to be. But being forced to wait doesn't exactly violate any individual right. You have to wait for a break in traffic anyway, and it's not as if you have a right to have that break miraculously appear when you want it.
No, it's not about you. It's about all of us. Everyone using the road imposes some delays on everyone else, but people who violate traffic rules such as speed limits tend to impose disproportionate delays; for every minute they save themselves, they easily cost the rest of us collectively several minutes or even hours. Hours spent waiting in traffic are hours of constrained liberty, so imposing speed limits is defensible as a liberty-maximizing measure.
Notice that in most places, there is no minimum speed limit. There may occasionally be people who feel like driving slow, but there is nothing inherently to be gained by doing so; you do not save time by going significantly slower than traffic. So while there's an intrinsic incentive to speeding (I can save myself a few minutes), people pay a natural price in time for going slow. Fines for speeding are meant to counteract the incentive to speed with a (hopefully greater) disincentive.
So let's consider discrimination. On the face of it, an employer or merchant who discriminates is making a foolish and self-destructive choice, forgoing an otherwise qualified candidate or customer for an arbitrary and irrelevant reason. It's sort of like someone deliberately choosing to drive very slowly; yes, it imposes inconvenience on others, but there's not a lot we can do about people who willingly impose disadvantages on themselves.
Of course, there’s much more to it than that. If discrimination were just a matter of people making foolish and arbitrary distinctions that go against their own interests, we'd dismiss it without much thought. If you walked into my shop and I refused to do business with you and asked you to leave because my invisible friend is allergic to your shampoo, I'd lose business and you'd go somewhere else, shaking your head at poor silly delusional me. My loss of business would be incentive enough that we wouldn't need to worry about making rules against such silliness.
But the sort of real-world discrimination that we try to pass laws against is different, because left unchecked it can turn into an actual incentive. If I post a sign outside my shop, boasting of my ethnically clean premises, I might actually gain a market advantage if ethnic bigots represent a market segment with any buying power. Worse, even if actual bigots don't make up an appreciable portion of the market, the perception that they do can become self-reinforcing. Even if I'm not a bigot, I might feel obliged to cater to the bigots whose business I might lose if I don't.
Consider, for example, the controversy we had in this city a few years ago when a new anti-smoking ordinance was being proposed for all workplaces. Bar owners, almost unanimously protested loudly that they would lose business if their customers couldn't smoke. Whether this was true or not, it was an almost universally held belief, so much so that smokers expected to be able to smoke in any bar they went into, and bar owners were loath to turn them away. Meanwhile, nonsmokers generally were resigned to the fact that if they went to a bar, they'd have to put up with smoke.
There's an inherent selection bias here. People who wanted to light up a cigarette just would, and people who did not want to didn't light up, but since they were accustomed to other people doing so, they wouldn't say anything. Bar owners rarely heard from potential customers who objected to the smoke enough to stayed away. So there was a powerful perceived incentive to allow smoking, whether or not it was actually in the bar owners' economic interests.
These perceptions take on a life of their own, and can become very hard to displace. It may even be that nobody at all actually agrees with them, but everybody goes along with them because they believe everyone else agrees with them. It's unfortunate that the Invisible Hand of the market is so poor at weeding out these things, but that's actually to be expected; when clever entrepreneurs find a common misperception to exploit, you can be sure they'll invest heavily in promoting and maintaining that misperception for as long as they can milk it.
Will the Invisible Hand persuade the Indiana state legislature to repeal its new Religious Freedom Restoration Act, or at least amend the worst bits? It might. I hope so. If it does, then that might actually be some evidence that we're outgrowing the need for antidiscrimination laws. But the fact that they passed it in the first place leads me to suspect we still need them.