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Employment Division, Department of Human Resources of Oregon vs. Smith determined that the state could deny unemployment benefits to a person fired for violating a state prohibition on the use of peyote, even though the use of the drug was part of a religious ritual. Although states have the power to accommodate otherwise illegal acts done in pursuit of religious beliefs, they are not required to do so.
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It is difficult to have a good balance between having too many exceptions and rights. If the Supreme Court were to allow the use of peyote by Native Americans then they would have a tough time winning cases that fight for other religions freedoms. The same thing goes for letting the Native Americans having a form of separated government.
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