The problem is that the right keeps trying to expand the individual to encompass businesses they own. The problem with this is that a business is not a dirty old pair of sneakers, it is instead a web of contracts with other human beings and organizations. It is essentially public in nature in a way that personal property is not.
This should be obvious but for some reason it is lost on many people. Ponnuru mentions the Religious Freedom Restoration Act (RFRA), which from what I can tell is perfectly intact and doesn't really have anything to do with how businesses interact with their customers. He makes clear, however, that the Arizona bill tries to make the bill apply to businesses as well as individuals, so it's not really clear why he brings up the RFRA at all.
I don't see how this is in any way OK. The right has been trying to push this for far too long with far too little opposition. The interests of the owners of Hobby Lobby or Chik Fil A are not the same as the interests of Hobby Lobby or Chik Fil A. Well functioning markets require that these distinctions remain intact, the owners of these companies should not have any rights to impose their beliefs on their employees, their employees enter into contracts with the organization and identify with the organization's goals, which are not the goals of their owners (even if they pencil it into a values statement, anyone with any experience with a business plan knows that values and missions are linked to what the company actually does, fluffing it up is just distracting and does nothing to change how the business is run).
Whenever an individual forms a business as a separate entity they give up the right to treat their efforts as purely private in exchange for the rights and protections granted to a business entity and take upon themselves a public identity and its accompanying rights and obligations. There is no public interest, or philosophical justification, in further blurring these roles. We have already gone way to far in this direction in the United States and it should be opposed at every turn.
What we should be concerned about is the power that we have granted these powerful organizations to invade the privacy of individual's private selves. While business owners are doing an excellent job obscuring their public selves from private view, for example individual tax returns have not been publicly viewable since 1926 (critical if we are going to really on individuals negotiating wages rather than unions, I feel this is a non-trivial element in modern income inequality), donor's identities to political campaigns are often obscured, and owners can hide their involvement in their company's lobbying efforts, they simultaneously have been incredibly successful in gaining access to information on individual's private lives the first two that come to mind are routine drug testing (this is such an incredibly demeaning practice that I continue to be shocked that it is still legal, where is the outrage?) and credit checks for potential employees (another outrageous practice that there is no good argument for, how can we possibly consider ourselves at liberty when we often have to give up this information to get a job?).
To address a specific one of Ponnuru's points, I hope these concerns make it clear why his assertion of "The advance of gay rights has at best an ambiguous relationship to the older conception of liberty," falls on deaf ears. I don't see this at all. The older conception of liberty is the idea that individuals have a voice in the decisions that concern them. Conservatives are always trying to to confine the discussion of liberty to a discussion of a single institution, the state. But it is clear if you actually read older works on liberty that these thinkers have a much more expansive conception of it. They are focused on the state simply because in their time private concentrations of power were largely broken up, without the modern corporate form private concentrations of power are necessarily limited. Early writers, like Adam Smith, make explicit mention that they see corporate entities, which in their day had to be authorized by a specific act of government, as a threat as well as part of the pernicious influence of the state. Since the 19th century, when laws were passed allowing the corporate form to be adopted without a specific act of government, the relation between the individual and non-state institutions has changed dramatically. To state the obvious, when single corporations give individuals power over 10s or 100s of thousands of their peers we are dealing with a different animal.
So the advance of gay rights is ultimately not so different. While conservatives do their best to dig up cases of a sole-proprietorship suffering from these problems the real issue at hand is whether a business's rights and responsibilities are separate from their owners. Since both use essentially the same form of organization in our market economy* there is neither the means nor a reason to make a distinction between these smaller businesses and larger ones. Like other attempts to advance individual rights and protect liberty this is a case where individuals are being protected against institutional discrimination, there is no reason to give institutional discrimination a pass because it is a business rather than a government. While an individual can have religious beliefs and rights a business that is not formed for a particular religious purpose cannot meaningfully be said to have religious beliefs to be protected.
This is what Conservatives fail to understand. The cause of liberty is about protecting the individual against the powerful, and particularly power imbedded in institutions. This is the root of the thinking behind the gay rights cause. If they understood this they would understand that while liberals will continue to try to curb the power of individuals like the owner of Hobby Lobby (I'm picking on Hobby Lobby since they were in the news fairly recently and I'm not going to pick on a small photography shop) to impose their beliefs on their employees and others while organizations like the Knights of Columbus are clearly religious in purpose and so would not be subject to the same sort of legislation.**
*we aren't hearing cases of part-time wedding photographers claiming self employed income, these people simply wouldn't return a call like many of the vendors we have been trying to contact for our wedding, while it's hard to get details these appear to be formally incorporated businesses whose owners should have realized that they are assuming a set of rights and responsibilities that go with owning a business as opposed to simply being self-employed
** From their respective web pages:
Knights of Columbus:
Charity - Our Catholic faith teaches us to “Love thy neighbor as thyself.” Members of the Knights of Columbus show love for their neighbors by conducting food drives and donating the food to local soup kitchens and food pantries, by volunteering at Special Olympics, and by supporting, both spiritually and materially, mothers who choose life for their babies. Knights recognize that our mission, and our faith in God, compels us to action. There is no better way to experience love and compassion than by helping those in need, a call we answer every day.
At Hobby Lobby, we value our customers and employees and are committed to:
- Honoring the Lord in all we do by operating the company in a manner consistent with biblical principles.
- Offering our customers exceptional selection and value in the crafts and home decor market.
- Serving our employees and their families by establishing a work environment and company policies that build character, strengthen individuals and nurture families.
- Providing a return on the owner's investment, sharing the Lord's blessings with our employees, and investing in our community.
It doesn't take a theology degree or deep study of liberal thought to see how these two things differ. Hobby Lobby seeks to "operate the company in a manner consistent with biblical principles." However, "offering our customers exceptional selection and value in the crafts and home decor market" doesn't flow from biblical principles the same way "the Knights of Columbus show love for their neighbors by conducting food drives and donating the food to local soup kitchens and food pantries, by volunteering at Special Olympics, and by supporting, both spiritually and materially, mothers who choose life for their babies," does. This shouldn't need to be explained and if conservatives understood the meaning of liberty and individual rights they wouldn't be so confused about what liberals were trying to do when they take on corporate overreach in protection of individual rights.