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Thursday, August 17, 2017

PayPal Stops Payment Processing For Some "Hate" groups

The news is out today that PayPal will no longer process payments for certain groups described as "hate" groups.  So is that legal?  It's not a silly question, but rather a very serious one.

Let's start with the law.  Absent a special statute or regulation, a person is free to do business with or refuse to do business with anyone.  That's why prior to the Civil Rights laws in the 1960's, it was perfectly legal to refuse to sell a home to an African American or to refuse to hire a Jew or a Hispanic.  Congress passed a law that outlawed discrimination in many areas including discrimination in commerce based on race, color, religion, sex, or national origin.  There are now further anti-discrimination laws which prohibit discrimination based upon sexual orientation, age, and other things in certain places.

How does that work?  Remember that pizza parlor that the media found that said it would not cater a gay wedding?  There was no applicable law that barred discrimination against gays, so the pizza parlor violated no law with the policy. 

But what about internet service providers like PayPal?  Can PayPal refuse service to a group whose politics it does not like?  Is there a law which bars such refusal of service?  That's a difficult question, even more difficult than the pizza parlor case.  After all, if a gay couple wanted to hold a wedding in a pizza place (which would be strange enough), there were many other such places where they could go.  On the other hand, if someone wants to process credit cards for internet transactions, PayPal is a necessary part of that effort.

I haven't done all the research to see if there are applicable laws which would bar PayPal's new position.  Certainly, there are arguments on both sides.  I just don't know the proper answer.  It does not seem to have ever been decided by a court.

There's a second question with which we need to deal, though.  Do we really want PayPal deciding who is and who is not a "hate" group?  What if Pay Pal decides that the local mosque is a hate group because some of the people who pray there were arrested on terrorism charges?  What if Pay Pal decides that a group called "Friends of the Islamic Republic of Iran" which sends food to the needy in that country is actually promoting terrorism and suspends dealing with the group?  What if Pay Pal decides that the Jewish National Fund which works on reforestation in Israel by planting trees there is helping the "occupation" and there constitutes a hate group?  What if Pay Pal decides that the ACLU provides help to criminals and terrorists and that such activities make it a hate group?  Do we really want PayPal deciding who is and who is not a hate group?

Don't get me wrong.  I would like to see the Nazis and the KKK stamped out once and for all.  I just think that we need to be more careful in allowing an organization like PayPal or Google to have the power to destroy a group just because it decides that the group is a hate group.  In today's world of heated rhetoric, being called a hate group is not what it used to be.  There are even organizations like the Southern Poverty Law Center who seem to label everyone with whom they disagree a hate group of some sort.

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