The ControversyI watched the Rachel Maddow segment where Rand Paul stuck his foot in his mouth, up to his hip, about the Civil Rights Act (1964). He expressed "reservations" about one of the Titles of the Act - it turns out to be Title II - that prohibits discrimination by private businesses that were public accommodations. He also seems to have a problem with Title VII, that prohibits discrimination in private company hiring.
The Libertarian ArgumentHe argues that prohibiting discrimination by private businesses is, essentially, a government taking of property from the private sphere into the public sphere, negating the owner's property rights completely. Plus, he sees it as trampling on their free speech and free association rights as well, all by evil government fiat. It's a classic libertarian, Randian worldview - all rights are absolute, or they are worthless.
So back to Title II. In the Randian world, private property and private rights are god above all else. Any infringement on this is a state overreach, and evil. In Randian Libertarianism, all property is private, and this is a Good Thing™. Hence, the labeling of any business that serves the public a "public accommodation" (a commonly used label, by the way) that can not discriminate by law is a horrendous government theft of business and freedom.
I can almost see his logic - but only almost. You see, his logic only works if you see the world in a binary view - either/or - all rights are absolute or nonexistent.
But in the real world, everything is comprised of competing rights. Your right to swing your fist stops where my nose begins. Your right to walk wherever you want stops at my property line. Even the Ayn Rand libertarians have to acknowledge this, but will throw a lot of double talk about personal responsibility and government overreach at you to quickly change the subject.
The Reality ArgumentIn the real United States of America, there are competing rights to everything, and specific private rights, particularly property rights, or even a person's freedom itself, can be abridged if there is a "compelling public interest" - in other words, if the good of the many outweighs the rights of the few - and there is due process in the taking or abridgment.
It is used all the time in criminal cases - people who are convicted of a crime are locked up (denied their freedom) for a compelling public interest (punishment and prevention of further crime.) It is used when they need to build a new freeway - eminent domain is often used by municipalities to put in new roads. (Now, eminent domain is often abused for corporate gain, but that's another rant.)
Research more about "compelling interest test" for determining the constitutionality of a statute that restricts the practice of a fundamental right, and the the Fifth Amendment and takings for the long standing back and forth over just property takings. Google is your friend.
In Title II these were used, with full deliberation and vote of Congress and signed into law by President Lyndon Johnson on July 2, 1964. It has been challenged in court. The right of people not to be discriminated against in public accommodations outweighed the private property rights to discriminate of the owners of such accommodations.
Why are they "public accommodations"? They are designated public accommodations because they are designed, as part of their business model, to attract and provide goods and/or service to members of the public - food, lodging, entertainment, supplies, equipment, etc. They don't require the proprietor to know you by name before you do business with them. You don't have to give your name to buy lunch at a lunch counter or go see a movie - you are just a member of "the public", hence it's public accommodation.
Was there another way? Not that I can think of.
What about private clubs, private houses? One thing to note is that Title II does not require landlords/hoteliers to rent rooms to people if they live in the small dwelling - you can discriminate against people if you actually live in the house you are letting out motel rooms in like a bed and breakfast. It also specifically excludes private clubs, which is why the Boy Scouts can discriminate against Atheists.