The “Hate Crimes” bill currently moving through Congress involves an unwise, and arguably unconstitutional expansion of federal criminal jurisdiction. But even at the state or local level, hate crimes are a bad idea. The whole debate of whether homosexuals should be included in hate crimes statutes is but one example of how hate crimes statutes undermine the principle of equal protection of the laws, by encouraging fights over whether some groups are or are not deserving of unequal, special protection.
The best argument for hate crimes laws is that a hate crime causes more harm than an ordinary crime, because it causes many other people to fear being victimized. This is true for some hate crimes (e.g., public vandalism of a synagogue), but certainly not all of them (e.g., a dispute between neighbors in which an epithet is used). Moreover, there are plenty of ordinary crimes (such as highly-publicized serial attacks on random victims), which also cause fear in many people besides the immediate victims. I suggest that judicial sentencing discretion allows for appropriate punishment for crimes which have unusually large secondary impacts.
As long as hate crimes statutes stay on the books, every hate crime statute should include a provision providing for extra punishment for hate crime hoaxes. (Above the level of punishment for ordinary hoaxes about non-existent crimes.) Just as a hate crime may cause heightened community fear, so does a hate crime hoax.
He has further thoughts here.