Full disclosure, I'm a white person (I'd also guess that pretty much everyone here is too), and I do fundamentally believe that since all white people benefit from white supremacy, we are all racists. That being said, I've accepted that as my truth, and that the more I become conscious of how I benefit from a white supremacist society, the more I can challenge and unlearn all of the racist garbage I've been taught. I truly believe this is the case for every single white person in America, specifically.
That being said, my stance has changed on this over the years, and I do think it really is a case-by-case basis, based on the show and what the intention is. You may notice some contradicting opinions ahead, and it's something I find myself thinking about sort of constantly, so I'm still trying to navigate the "truth" in what is an inherently subjective medium--especially during this time where I feel it is imperative as white people to be not only not racist, but anti-racist.
First, I think we should collectively abandon the term "colorblind" because none of us are blind to race in the US, specifically (and I am specifically talking about US since that is my lived experience). However, as some people have mentioned, if "colorblind" casting can exist, it can happen in fantastical worlds. Heathcliff Saunders wrote a very powerful essay on this that really hit the nail on the head I recommend anyone interested in this topic read his response hit the nail on the head where he cites the idea of real worlds vs. imagined--among other things. What's interesting here is that even in "imagined worlds", racism can still exist. It really struck me when I recently realized that the only reason Wicked is so popular is because it's a story that talks about racism but in a way that doesn't make white people feel bad, because people with green skin don't exist in the real world. Therefore, it is more palatable to white tourist audiences because the colourism in Wicked only exists in an allegory where white audiences can distance themselves to colourism and racism in their everyday lives--and while shows like Wicked helmed by white creators is allowed to run for 20+ years and not the same can be said for a show about actual racism written by actual non-white writers, that's a problem in and of itself. And yet, a Black actor playing Glinda took so long to happen because the role of Glinda is so closely associated with being a preppy white girl. Even in Oz, race is a thing. We know this because people other Elphaba because her skin is Green. Strangely, we've even had few Black Elphabas, and I suspect the reason for this is that producers are fearful that it hits too close to home for white audiences, and white audiences expressing discomfort = less butts in seats. In the reverse of this, The Wiz boarders on afrofuturism--a world where blackness is the norm, which, especially for its time, was very healing for black audience members I imagine (despite the fact that Glinda descended from a giant watermelon instead of a bubble the OG production, but I digress).
With regards to "historically accurate casting", Bitter Gertrude has written a really helpful piece on what "historically accurate casting" means that I found to be really helpful. For lack of a better phrase, there have always been those in BIPOC* groups who have "slipped through the cracks" and were able to assimilate into mainstream white society. While I'm inclined to agree in Chicago, for instance, that it is unlikely a black woman could run a prison--it doesn't mean it never happened. It was unlikely for women in any variety to be in leadership roles in the 20's, but again, it did happen--which leads to me believe that it is possible that it could've happened. There's also an entire argument to be made that there are many biracial individuals, for instance, Carol Channing, were black but were able to "hide it" and therefore assimilation was more achievable for them--which is why I believe strongly that it could've happened. However, the US has such an ingrained history of racism--it is truly the fabric our nation was founded on--that I think when we don't cast consciously, we run the risk of erasure, which is, currently why so many (including myself) are pushing back against "colorblindness"--and I truly think that erasure is in many instances, just as bad as actual racist depictions of characters.
As Healthcliffe touches on, in the instance of Hamilton (and though he doesn't mention it, and I'm sure he didn't because was in it and didn't want to piss off Dave Malloy, et al) and Natasha, Pierre...those works have caused harm to some extent, because those works are attempting to evoke a world that the creators wish exist but doesn't: which is a postracial world--but retelling through the lens of the past. But every story is different. I won't say the title of the play as it will identify me, but I directed a production based on a true crime story that was the first NYC revival of the piece, which was originally cast with an all-white cast, because the real life figures were all white--and when I directed it, I chose for two of the main characters to be played by a black woman and an asian woman, respectively. I still am not sure if I made the right call or not. My thinking at the time does in some way mirrors how I feel now, which is that it is better to cast inclusively than not, even in historical pieces--because if we completely exclude actors of color, then we are also extremely complicit in blatant, systematic, racism. But I can't help but wonder if I was complicit in erasure. I think both of the actors were very happy in the production, and that it was evident they were cast in the roles they were cast in was because they were talented above all else. However, if I could've done it again, I don't know if I would've made the same choices that I did back then. Especially because while race wasn't talked about in that play--but it's also not talked about because all of the characters were white. However, as others have pointed out, when we are watching a play, we are deciding that we are seeing a dramatization of something--and white audiences in America are often able to overlook gender or age when not cast "appropriately", but race is something we just can't see past. However certain stores have just been done to death, that they almost feel like pageantry--and while I wouldn't leap at the opportunity to cast a woman of color as Rose in Gypsy, at this point, it almost feels so long ago that it's like a legend. Same goes for Hamilton, or even Assassins. But here we are, right where we started: if we just agree to say "f_ck it, this is a dramatization, it's all non-reality anyway--so who cares?" we wind up with erasure.
However, in the context of historical casting--where a story is linked to a certain time and place, and the story focuses on white people--how to you tell the story responsibly and be inclusive? Going back to Bitter Gertrude's point, BIPOC* as I suggested, were in certain instances able to assimilate. But when we do we get to decide what characters were and weren't allowed the same permissions in relation to other white characters within a dramatic context is an entirely different predicament--especially when social class is involved. I think the only guaranteed way to reduce harm for the audiences, actors, and everyone involved is to specifically hire a person of said group and have them be involved in the creative process, and pay them well. You risk tokensim, and not all people of that group exist in a monolith, therefore, you can still create something that has elements of racial tonedeafness or ickiness, for lack of a better word, but I think if a noble attempt is made to include a person of said ethnicity on board and is actively involved in the process, it almost always adds more nuance. It also actively takes work not to tokenize creatives of color in this way, and I think allowing space to be honest about this and not expect creatives of color to be a mouthpiece to "approve" your decisions as a writer or a director is above important, above all else.
This was a long read, and I'm still not really finished saying what I want to say, but if you got this far, good on you. I think at the end of the day, the best resolution is to keep doing what we're currently doing--which is expand the cannon to feature more writers of underrepresented races, and we will run into these ethical clusterf__ks somewhat less.
*I know a few black creators who have taken issue of the use of the term BIPOC, and that the experience of each of these racial groups should not be lumped together. I am inclined to agree with this--although there are certain themes that almost all disenfranchised racial groups tend to experience, it is a disservice to lump them all in together. Especially when colourism is also very prominent in almost all disenfranchised racial groups.