Damage to Arizona’s Brand Will Have Long-Term Effects

Arizona Iced Tea is not based in Arizona, and now they sure as hell want you to know that. The passage of SB1070 and the resulting backlash in the form of boycotts and outrage have made it a liability to be a business based in the state of Arizona. While most of the calls for boycotts focus on travel, conventions, and businesses currently based in the state, the real long-term economic damage will be from businesses that choose to avoid locating or expanding to Arizona.

Cities and states are constantly trying to provide economic incentives for businesses to set up shop in their communities because of the long-term economic benefits that these businesses will yield through new jobs and tax revenue. However, Arizona’s brand has suffered a critical blow. Association with the state has negative economic consequences that will cause most businesses to go elsewhere with their economic expansion. The economic consequences will not be solely the short-term revenue losses from relocated conventions, but the accumulated losses of the economic development that could have been.

Governor Jan Brewer and her Republican colleagues in the state legislature have turned the state into economic poison. Even if SB1070 is overturned in the courts and calls for boycotts are withdrawn, the risk that they will do once again something similar remains.

Without a dramatic change in political leadership in the state of Arizona, businesses will be wary of potential fallout from political decisions and avoid development in the state. The Republican leadership has cost Arizona jobs and revenue that will be felt for years to come.