Corporate Personhood

To bring everyone up to speed on the purpose of the title and this article, I was in a recent discussion with a friend on the other side of the political aisle who asked me to define the term “corporate personhood.” The discussion had its genesis around a story that placed the onus of responsibility for the state of the economy on Wall Street. I countered that burdensome regulations and government intervention were to blame. At one point corporations were brought up, and the term “corporate personhood” became the focal point. We decided to do “dueling articles,” and his piece can be found here.

The term comes from the question of whether or not a corporation counts as a person in terms of constitutional rights, so we first have to define a corporation. Merriam-Webster defines a corporation as follows:

1.  a. A group of merchants or traders united in a trade guild; b. The municipal authorities of a town or city.

2. A body formed and authorized by law to act as a single person although constituted by one or more persons and legally endowed with various rights and duties including the capacity of succession.

3. An association of employers and employees in a basic industry or of members of a profession organized as an organ of political representation in a corporative state.

Essentially, a corporation is a single entity made up of a group of individuals. My off-the-cuff response was a bit more simplified:

“It amazes me how people make the leap that a corporation is some supernatural entity that needs to be defeated, like the Balrog or something (YOU SHALL NOT PASS!). It’s not. A corporation is a group of people working together towards a common goal of producing products that people want to buy. The only reason they BECAME corporations, instead of (for example) LLC’s is because they are really good at what they do.”

So let us recap. Thus far, we have established that corporations are made up of individuals, the next step is to ascertain what the law says. USC § 1 defines corporations as:

“the words “person” and “whoever” include corporations, companies, associations, firms, partnerships, societies, and joint stock companies, as well as individuals;”

Friends, it does not get much clearer than that. But since there is still an argument despite the above, we need to press on.

Campaign Finance Reform

This discussion now takes us into the morass of “campaign finance.” While there have been a few attempts throughout our jurisprudence to restrict who can give what to which candidate, the most commonly referred to (modern) law is the aptly-named Bipartisan Reform Act of 2002, which is known as McCain-Feingold (votes can be found here).

Legally speaking, a corporation counts as a person. So now we have to ask ourselves whether or not a corporation is afforded constitutional rights. We can argue this two ways. First, a corporation is simply a group of individuals. Since individuals have constitutionally protected rights, they keep those rights even if they get together with others. Secondly, the law flat out states that corporations are “persons” which are protected under the Constitution.

The Constitution uses the term “Person” and “Citizen” almost interchangeably, using the term “citizen” when discussing location and “person” in general. For example, Article IV Sec. 2 covers Privileges and Immunities of “Citizens,” while at the same time laying out the framework for legal action against “persons” that commit a crime in one state and flee to another.

Furthermore, the Bill of Rights uses the term “people,” which is the plural form of person. A corporation is legally defined as a “person” and specifically defined as a group of people, so it would take a great leap to claim that the bill of rights, specifically the First Amendment, does not apply to them.

What McCain-Feingold did was, in the words of Justice Kennedy speaking for the Supreme Court in Citizens United v. Federal Elections Commission:

 “The law before us is an outright ban, backed by criminal sanctions. Section 441b makes it a felony for all corporations—including nonprofit advocacy corporations—either to expressly advocate the election or defeat of candidates or to broadcast electioneering communications within 30 days of a primary election and 60 days of a general election.”

Legality

The First Amendment was written not just to protect speech, but to protect political speech, and the language is pretty clear: “Congress shall make no law…abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”

While there have been several challenges to the law, including one by Senator Mitch McConnell (R, KY), this decision was by far the most comprehensive in deciding the constitutionality. Essentially, the court decided that barring corporations from participating in political speech during an election was unconstitutional, and went on to cite numerous legal precedents where corporations were defined as persons with First Amendment rights (Section A, 1). Ironically, though I suppose predictably, most supporters of campaign finance laws do not know the history of it in this country.

Philosophy

There is certainly a case to be made for restrictions on campaign finance. We do not want foreign interests, whether it be companies or governments, to fund candidates they want. But to restrict the political speech of Americans is something completely different.

Before we continue, we need to define “money.” I know, it seems a bit strange, but indulge me for a moment. Money is a “tool of exchange” that represents one’s labor. Money cannot exist unless a person expends labor to produce a product or service that someone else values enough to buy with what they produced with their labor. We use paper money because it is not convenient to trade in livestock or large amounts of metals. The amount of money one earns is representative of the amount and value of their labor, which is why a corporate CEO that works 18 hours per day and is in charge of 500 people producing products for millions of individuals while ensuring the stockholders invested their own money wisely earns more money than a union janitor doing the 9-to-5 mopping floors and taking out trash.

This money, in the context of this subject, represents speech in that it is used to produce advertisements and buy ad space in media that speak on certain issues important to the survival and success of the company. Sometimes this involves speaking for or against certain candidates or platforms.

The arguments against allowing corporations to speak during election seasons normally revolve around the fact that they are able to pool money, buy ads, and drown out the voice of the common people. This is a class warfare argument and legislation banning speech by corporations (i.e. groups of people) makes them legally-defined special classes of which it is legal to discriminate against. The irony (and philosophical shortcoming) is that in a nation that legally and philosophically was set up to value the individual, we consistently have to fight political battles to stop certain people from passing laws that group people together so as to both dole out special favors and discriminate against. A fitting analogy is that the people who advocate for special laws against “the rich” are no different than those who supported Jim Crow laws.

There is another ethical argument to be made against this sort of campaign reform law, and we saw this play out up close and personal in 2008. During that election season, we saw speeches by all candidates denigrating corporations. Public sentiment against corporate CEOs reached the point to where people were protesting outside of their private homes. Corporate CEOs are also routinely called before Congress to justify their ability to make money. This is, again, the definition of class warfare, which had its place in 17^th century feudal Europe, but was outmoded by the advancement of free market capitalism and the philosophy that stated all men were created equal.

Essentially, the argument against corporate speech boils down to saying that they should just shut up and take the congressional grill sessions, the protests, the public denigrations, all while the people they are not allowed to speak out against paint them as evil, institute more onerous regulations that make business even harder to conduct, and pass tax laws that take more of their money away from them (yes, corporations do pay taxes, as do CEOs, despite what that bumper sticker on the Prius says). Corporations should just stay on their knees and smile as they are punched, kicked, and made into monsters, then are taxed for the privilege.

How is that ethical? It is not. If politicians are going to spend a year and a half during election season speaking out against the very corporations they depend on to fund their pet projects and keep the nation’s economy going, the corporations, and the people running and working them, should be able to call those politicians on their drivel.

(Originally posted at Federalism Online)