Reject Corporate Personhood

New Justice Sonia Sotomayor proved herself to be a good hire in her first appearance with the Supreme Court when she challenged the idea that corporations have broad First Amendment rights that the court should expand. She suggested that the court should instead reconsider the 19th-century usurpation of constitutional rights on behalf of corporations.

The Supreme Court is considering overturning not only the recent restrictions on electioneering by corporations and labor unions within 60 days of an election, but also restrictions that go back a century to prohibit corporations from contributing to federal political campaigns.

The case involves Citizens United, a non-profit corporation that sought to air a movie attacking Hillary Clinton during the Democratic primary season last year. Citizens United v. Federal Election Commission was originally argued before the Supreme Court in March, but the court ordered a new hearing for constitutional arguments for Sept. 9. The court seemed to be poised for a sweeping affirmation of corporate “personhood,” or the right of corporations to equal protection of the laws.

As John Nichols writes on page 20, Chief Justice John Roberts promised during his confirmation hearings in 2005 to respect judicial precedent — but that was before the balance of power shifted right with the retirement of Sandra Day O’Connor. Now, with Sam Alito on board, he has pressed for a review of campaign finance laws that were upheld by the court as recently as six years ago.

Many court observers think Roberts has the votes of Antonin Scalia, Clarence Thomas, Alito and Anthony Kennedy to overturn at least large sections of the 2002 Bipartisan Campaign Reform Act, a.k.a. McCain-Feingold. They also might overrule previous court decisions that upheld the constitutionality of restrictions on corporate money in politics.

Such a decision would tear away the veneer of citizen control over government and return us to the days of the Robber Barons in the 19th century. The Tillman Act, pushed by Teddy Roosevelt in 1907, banned corporate contributions to federal candidates. Many states have similar laws for state races.

The Founders clearly considered corporations to be artificial beings subject to government charter, as Chief Justice John Marshall wrote in an 1819 case. “It possesses only those properties which the charter of its creation confers upon it,” he noted. But as railroads and other corporations proliferated after the Civil War, they began to flex their muscles and pressed the claim that they were “persons” who should be protected under the 14th Amendment. They hoped to dodge special taxes and regulation.

Thom Hartmann in Unequal Protection: The Rise of Corporate Dominance and the Theft of Human Rights (Rodale, 2002) noted that railroads had lost every Supreme Court case that sought 14th Amendment protections in the decade before the Southern Pacific Railroad challenged Santa Clara County, Calif.’s authority to tax the railroad’s right of way. The court in Santa Clara County v. Southern Pacific Railroad Co., in 1886 ruled that the railroad was not liable for the taxes on a technicality. It explicitly did not rule on the 14th Amendment question, but in “headnotes” commenting on the case, court reporter J. Bancroft Davis, a former railroad executive, quoted Chief Justice Morrison Waite telling attorneys to skip arguments over whether the 14th Amendment’s equal-protection clause applied to corporations, because “we are all of opinion that it does.”

Davis’ commentary was not part of the official court ruling. In fact, Justice Stephen J. Field, a former railroad lawyer, was so upset that the court did not rule on the 14th Amendment issue in the Santa Clara case that he wrote a dissent that argued that railroads were persons entitled to equal protection of the laws. But since then Davis’ note has been accepted as part of the law.

Later decisions expanded corporate rights, Jess Bravin noted in the Wall Street Journal (Sept. 17). In 1928, the court struck down a Pennsylvania tax on transportation corporations that exempted taxicab drivers. Justice Pierce Butler wrote that corporations should get “the same protection of equal laws that natural persons have.”

Justice William O. Douglas attacked corporate personhood in 1973, rejecting Butler’s 1928 opinion as overstepping “the narrow confines of judicial review” by overruling the legislature’s decisions to tax corporations differently than individuals.

At the Sept. 9 hearing, Sotomayor seemed to be up for a fight as she reminded Ted Olson, attorney for Citizens United, that he previously had argued that the case could be decided on narrow, non-constitutional grounds. In a question to Floyd Abrams, also arguing for Citizens United, about overturning previous judicial decisions, Sotomayor noted that courts “created corporations as persons, gave birth to corporations as persons ... There could be an argument made that that was the court’s error to start with ... [imbuing] a creature of state law with human characteristics.”

Justice Ruth Bader Ginsburg seemed to have a taste for the argument, noting that “A corporation, after all, is not endowed by its creator with inalienable rights.”

A group that includes Program on Corporations, Law and Democracy, the Women’s International League for Peace & Freedom, Democracy Unlimited of Humboldt County, Shays2: The Western Massachusetts Committee on Corporations & Democracy and the Clements Foundation filed a brief in Citizens United challenging “corporate personhood” and urging the court not to overturn laws preventing corporations from making political contributions in federal elections (see clementsllc.com).

If the Supreme Court rules that corporations are entitled to all the rights of natural persons, then corporations should be subject to all the responsibilities of natural persons as well. They should be stripped of legal and tax benefits that are not available to private individuals, including special relief that is available under bankruptcy laws. And corporations that are convicted of felonies should be required to shut down during the period when they otherwise would be imprisoned.

The court also should be required to explain how a person, under the 14th Amendment, can be owned, as a corporation is.

A more comprehensive solution to the problem of corporate personhood would be a constitutional amendment clarifying that corporations are not persons under the 14th Amendment. ReclaimDemocracy.org has proposed such an amendment “To Preclude Corporations form Claiming Bill of Rights Protections.” It states that the US Constitution protects only the rights of living human beings; that corporations and other institutions should be subordinate to any and all laws enacted by governments; that corporations and other for-profit institutions are prohibited from attempting to influence the outcome of elections, legislation or government policy; and that Congress should have the power to implement the article.

How a Bill Becomes Sausage

As we go to press, the Senate Finance Committee is chewing through Chairman Max Baucus’ health reform bill which, when he made it public, didn’t please many people on the right, left or middle, though it pleased insurance corporations. The committee was expected to slog through more than 500 amendments and we’ll wait to see what survives the committee process before we get too excited about it, but the Finance bill will still have to be merged with the more liberal bill that came out of the Health, Education, Labor and Pensions Committee in July. And whatever gets through the Senate must be reconciled with the House, which has yet pass a bill. So we still have at least a few more months of hissy fits before the final version gets anywhere near the Oval Office. But that doesn’t mean you should stop pressing your senators and your rep to support universal health coverage with an employer mandate and a strong public option that everybody can participate in from Day 1 — no triggers, co-ops or other tricks to preserve the sanctity of corporate profits. — JMC

From The Progressive Populist, October 15, 2009


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