The Bathroom Bill Might Have Cost Texas 50,000 Jobs
The anti-transgender bathroom bill debate is a strike against any Texas city getting the Amazon HQ2.
Despite all the breathless excitement and competing promotion among cities, attracting the Amazon second headquarters—also known as HQ2—to Texas is a long shot thanks to Lieutenant Governor Dan Patrick and Governor Greg Abbott. They may have already pissed away $5 billion in construction and 50,000 permanent jobs for Texans with this summer’s special legislative session and its marquee issue—the bathroom bill.
Only the most craven cynics still promote the idea that the bathroom bill, which businesses in Texas lined up against last summer, had anything to do with keeping predatory men out of women’s bathrooms. The legislation was solely about whipping up anger against the LGBTQ community within a fundamentalist religious base of voters, who tend to turn out heavily in the Republican primary. It may have been good primary politics for the state’s top two leaders, but now that a grand economic prize is on the table it looks like foolishness at best and gross incompetence at worst.
Amazon, which already had 20,000 fulfillment jobs in Texas, was one of the companies that opposed the bathroom bill. One of the major concerns businesses had about the bill was that it would make employee recruitment and retention a problem—not only for LGBTQ employees, but for a millennial workforce that tends to be more tolerant than previous generations. And though the company’s request for proposal to cities vying to land the new corporate HQ does not specifically mention anti-discrimination ordinances, it does say, “The Project requires a compatible cultural and community environment for its long term success. This includes the presence and support of a diverse population, excellent institutions of higher education, local government structure and elected officials eager and willing to work with the company, among other attributes.”
But if you’re still unsure if the bathroom fight will affect Amazon’s decision on whether to come to Texas, let’s look to recent history for an example. Not so long ago, Texas almost lost an $80 million Apple sales and service center and its 700 jobs over a gay rights issue.
In late 1993, three of the five Williamson County commissioners put Texas in the national spotlight by voting to reject $750,000 in tax breaks for Apple simply because the company had domestic partner benefits insuring that unmarried employees could get health insurance for their partners. Apple’s policy—notably in place before gay couples were granted the legal right to marry—applied to both heterosexual and same-sex couples.
One of the commissioners, David Hays, said he voted against the tax break because he did not want to walk into church with people saying, “There’s the man who brought homosexuality to Williamson County.” Another said he voted for “promoting family values.” The Republican Party of Texas executive committee passed a resolution praising the commissioners who voted against the tax breaks.
Apple immediately said that without a tax incentive it would look at locating elsewhere. “We’re not in the business of defining family values. We’re in the business of selling personal computers,” a company spokeswoman said at the time.
Then-governor Ann Richards was a political friend of the LGBT community, but she also was a top promoter of business coming to Texas. Richards managed to attract businesses without the benefit of the gubernatorial slush fund known as the Texas Enterprise Fund, which governors since 2003 have used as a cash-incentive “deal-closing” kitty to lure companies into expanding or relocating in Texas. So though recent governors have created economic development with money, Richards did it by the power of persuasion. She also used her unique role as the state’s first female governor elected in her own right—jokingly referring to herself as a “two-headed cow” that company CEOs wanted to see—to gain an audience. “Some people are willing to let me into their office and talk to me just because they want to see the genuine article,” she said. But if she got through the door, she usually won the argument.
Exactly what behind-the-scenes work Richards did in Williamson County is unknown, but she became the effective intermediary, negotiating a compromise between Apple and the commissioners. The deal was simple: Instead of getting an up-front break on taxes, Apple would pay its taxes and then get a rebate. Ultimately, the argument became less about gay rights and more about whether government should dictate to business how to conduct itself.
Hays converted from a no to a yes, and the incentives for Apple passed, keeping the computer manufacturer in Texas. Hays had put economic development ahead of fundamentalist politics. After flipping to support the deal, Hays sheepishly left the meeting, only to be confronted by a minister. “I’m very disappointed in you,” the minister said, according to the Austin newspaper. “And there is a swarm of people over there who are very disappointed in you.” The commissioner sighed, “I know.” A young man in the crowd shouted: “Gays are going to be infiltrating the whole county!” But gay rights groups praised the decision, and the head of the Greater Austin Chamber of Commerce said, “We’re happy when Apple’s happy, and Apple’s happy this is behind them.”
That was almost 24 years ago. That service center expanded an Apple toe-hold that originally was established with a Round Rock office in 1991. Over the years, the company shifted its focus from Round Rock to Austin. Today, the company has 8,407 direct employees in the state, another 105,000 jobs in app development, 515 suppliers with thirteen manufacturing facilities, and eighteen retail stores. According to the company’s website, “Apple’s second-largest corporate presence in the world is in Austin, with 6,000 employees from the local area.” Apple’s largest campus—1.1 million square feet—is located in North Austin. It is unlikely any of that would have happened if the Williamson commissioner’s court had refused to accommodate the company in 1993.
And, so far, fire and brimstone has burned neither Round Rock nor Austin off the map as retribution. No one has turned into a pillar of salt. Lot’s wife probably could be a happy homemaker here. Austin is a Democratic stronghold, and Williamson County is reliably Republican.
But yet, Texas finds itself in a similar situation almost two decades later. Sure, business won out in the bathroom bill fight, but Patrick and Abbott have not ruled out the issue coming up again either in the regular legislative session of 2019 or in any other special session.
As state Representative Byron Cook, a Republican from Corsicana, recently wrote in newspaper op-eds: “So will Amazon seriously consider any of the Texas cities competing for Amazon’s second headquarters? Probably not, unless Abbott and Lt. Governor Dan Patrick take the bathroom bill off the table for future legislative sessions.”
In all likelihood, Texas is probably too late to have a viable shot. If Abbott and Patrick are serious about expanding the Texas economy, though, they should tell their supporters they fought a good fight and lost, then take the bathroom bill off the agenda—forever. Even that might not be enough as clergy across Texas continue the fight one city, one school district at a time. Patrick made clear during the debate that the bathroom bill did not apply to private business because he is a “free enterprise” Republican. Amazon is making it equally clear that politicians who regulate community standards of morality also are regulating private business.
Ann Richards put jobs and economic growth ahead of prejudices. When she won the fight in Williamson County, Richards simply said: “This should send a very positive signal to the rest of the country that Texas is serious about bringing industry to this state.” To commit to the economic future of Texas, Abbott and Patrick should do the same.