The reason this kind of thing is generally illegal is because not only does it normalise hate, but in certain areas like small towns there may be only one hotel or one place to get your hair cut or one hospital. If you go there and they're like "what is this darkie doing in my hospital", you're fucked. The next one isn't for 200 miles.
Libertarian nonsense like this just doesn't fit reality any more than socialism or communism does.