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The Free Market Economics of LGBT Equality in Texas

06/03/2015 12:28 pm ET | Updated Jun 02, 2016

When the 2015 Texas legislative session drew to a close, a small group of people behind a new initiative quietly celebrated their part in the defeat of more-than 20 anti-LGBT legislative proposals. The group, known as Texas Competes, is a pro-equality business initiative housed under the non-profit organization, Equality Texas. And while backers of the discriminatory legislation relied on the premise of what is morally right, Texas Competes silently assembled a coalition of Texas businesses based on what is financially beneficial.

Months before the legislative session began, a small group of Equality Texas members formed an ad hoc committee to figure out a new way to combat LGBT hostile legislation. In the wake of many national LGBT legal victories, members of Equality Texas anticipated an onslaught of anti-LGBT discrimination. In order to attract businesses, Texas Competes showed just how important LGBT equality could be to a company's bottom line.

"We believe that treating all Texans and visitors fairly is essential to maintaining Texas' strong brand as the premier home for talented workers, growing businesses, entrepreneurial innovation, and a thriving travel and tourism industry," as stated on the Texas Competes website.

The initiative focused on four key components: recruiting top talent, attracting new companies to the state, supporting a healthy tourism industry and illustrated and maintaining the integrity of the Texas brand. As a result, over 250 businesses in Texas -- including Dell, Southwest Airlines, Samsung and Dow Chemical -- signed a pledge stating that LGBT equality was critical to the success of their business.

"We believe that treating all Texans and visitors fairly is essential to maintaining Texas' strong brand as the premier home for talented workers, growing businesses, entrepreneurial innovation, and a thriving travel and tourism industry," as stated on the Texas Competes website.

According to Rudy Oeftering, a representative of Texas Competes, this innovative, free market approach to legislative maneuvering caught the proponents of the anti-gay bills completely by surprise.

"For 30 years, reactionary social conservatives have been using LGBT citizens as a political punching bag. This year, the Texas business community has put an end to that."

After the tremendous backlash that the Indiana economy and business community experienced as a result of the passage of the "religious freedom" legislation, Oeftering says business leaders in Texas were even more inclined to sign the pledge.

"We can no longer call ourselves pro-business while being perceived as anti-gay."

According to Texas Competes Executive Jessica Shortall, a key driving point used to enlist businesses was to singularly focus on how legislation could damage the Texas economy. Shortall said that any talk about "the right thing to do" was intentionally left out of the organization's talking points.

For example, Texas Competes emphasized how the passing of HB 4105, a bill that would have prohibited state and local employees from recognizing, granting or enforcing a same-sex marriage license or any funds being used for an activity to license or support these marriages, would show Texas as a staunchly anti-gay state. This national reputation would significantly inhibit the economic livelihood of the state and limit the financial success of Texas businesses.

It was an easy argument to make. States like Indiana and Arizona received an inundation of unwanted attention from similar "religious freedom" laws. As a result, many companies have lost significant revenue opportunities and people from other states have called for a ban on any non-essential business and travel to Indiana.

Business leaders in Texas could see just how damaging anti-LGBT legislation could be, as Indiana Gov. Mike Pence tried to do damage control while doubling down on his decision to pass the "religious freedom" law. Major companies like Apple and Salesforce condemned the state for its practices. The company, Angie's List, which is based in Indiana, cancelled a planned expansion. The NCAA, which is also headquartered in the state, said that it would consider moving its events somewhere else as a result of the law.

These headlines created the perfect climate for Texas Competes to skirt the politicking of lawmakers by assembling an army of businesses that stood for LGBT-inclusive policy. Now that the session is over, the organization will continue to enlist companies of all sizes to sign the pledge.

"Now, it is all about strength in numbers," Shortall said.

The market economics approach to equality paid off. Every one of the 26 LGBT discriminatory bills up for a vote this session failed to pass. Given the staunchly anti-gay track record of Texas legislators in previous sessions, it would appear that where moral arguments have little influence, money still talks.