Corporations Are People, Too

CorporationThere’s been a lot of upset to our left this week over the perception that Citizens United recognized corporations as having the same rights as people. The gist of the complaints seems to be that this notion is deeply offensive – that putting creatures of statute on par with people somehow diminishes the latter.

This has led, unsurprisingly, to some pointed (but accurate) responses. Julian Sanchez made the point yesterday:

[A]s my liberal friends all seem to be indignantly announcing in the aftermath of the Citizens United ruling, corporations aren’t really people! They’re creatures of statute, and “corporate personhood” is just a convenient legal fiction. Which is fair enough, but also seems to miss the point rather spectacularly. As a practical matter, it is hard to imagine any constitutional liberty that could not be reduced to a hollow joke if we refused to count as an infringement any regulation that nominally targeted only the corporate mechanism for coordinating its exercise.

Having dispensed with the repellent doctrine of corporate personhood, we can happily declare that journalists enjoy full freedom of the press … as long as they don’t plan on using the resources of the New York Times Company or Random House or Comcast, which as mere legal fictions can be barred from using their property to circulate unpatriotic ideas. You’re free to practice your religion without interference — but if it’s an unpopular one, well, let’s hope you don’t expect to send your kids to a religious school or build a church or something, because those tend to involve incorporating. A woman’s right to choose is sacrosanct, but since clinics and hospitals are mere corporations with no such protection, she’d better hope she knows a doctor who makes house calls. Fill in your own scenarios, it’s easy.

Ilya Somin makes the same point thusly:

On this view, the government would be free to censor the New York Times, Fox News, the Nation, National Review, and so on. Nearly every newspaper and political journal in the country is a corporation. If the Supreme Court accepted this view, it would have to overturn decisions like New York Times v. Sullivan and the Pentagon Papers case.

They’re both right, of course. The objection is not, of course, new – the movement to reject (or at least profoundly alter) the concept of corporate personhood has been around for some time. We just haven’t often seen it so loudly and frequently expressed as has been the case since Citizens United was handed down.

The impulse to reject corporate personhood has always struck me as arising from superficial analysis. As Messrs. Sanchez and Somin pointed out, if you extend the logic of the anti-corporate rights crowd only a step or two, the argument looks much different. And it isn’t enough to respond that the New York Times won’t be affected by overturning Citizens United because the First Amendment guarantees a free press. Either corporations can have rights or they can’t. If it’s illegitimate to recognize that they have free speech rights, it’s equally illegitimate to extend them the right guaranteed by another clause in the same Amendment. And if they have the right to non-interference with publication, they must perforce also have free speech rights.

At the core, corporations are just human constructs. We invented them to further our own purposes. They exist as concepts rather than physical objects, but have no more or less moral agency than any other human invention. Just as a gun or a piece of paper are, in and of themselves, neither moral nor immoral but can be used either way, so too are corporate entities morally neutral. It suits the purposes of people as individuals to concatenate into corporations. As such, the statutes that created them confered upon them such trappings of personhood as were necessary for them to serve the purposes for which we need them. To strip those away because one finds it distasteful would both short-sighted and profoundly destructive.

FILED UNDER: Economics and Business, Law and the Courts, Politics 101, ,
Dodd Harris
About Dodd Harris
Dodd, who used to run a blog named ipse dixit, is an attorney, a veteran of the United States Navy, and a fairly good poker player. He contributed over 650 pieces to OTB between May 2007 and September 2013. Follow him on Twitter @Amuk3.

Comments

  1. Eric Florack says:

    Dodd;

    It has always struck me as odd that those on the left spend so much of their time catering and kissing the backsides of various favored groupings of individuals, such as a race a gender or a sexual orientation, and yet do consider that corporations… which are in fact groups of individuals just like those they favor… have fewer rights than those they favor. And yes, I consider that groupings based on race a gender or a sexual orientation, are human constructs as well.

    Maybe, just maybe, in the end, it’s just because private corporations do not fit in with the neo-socialist mantra?

  2. Eric Florack says:

    Or, Unions. Hmmm?

  3. sam says:

    Of course, the philosophically interesting exercise is trying to determine which rights–and duties–that accrue to flesh and blood, individual, persons do not accrue to corporate persons–and why. For instance, f&b persons can vote; why cannot a corporate person vote? An f&b person can sit on a jury; why cannot a corporate person sit a jury? And so on. The answers are not obvious.

  4. yetanotherjohn says:

    So the left has a problem with non-persons having free speech. Well let’s shut down the ACLU, unions, ACORN, NOW, green peace, UN and democratic party. All of those are non-persons so why should they be able to talk?
    Of course the notion of personhood is itself a bit of a slippery slope. Why can’t a 20 year old person buy beer? Why can’t osama vote? Why can you kill a baby that is partway out the birth canal but not all the way out?

  5. sam says:

    So the left has a problem with non-persons having free speech.

    Uh, nobody believes that nonpersons have a right to free speech. The argument is over what kind of entities we’re willing to grant personhood–and the limits of that personhood.

  6. sam says:

    As Messrs. Sanchez and Somin pointed out, if you extend the logic of the anti-corporate rights crowd only a step or two, the argument looks much different. And it isn’t enough to respond that the New York Times won’t be affected by overturning Citizens United because the First Amendment guarantees a free press. Either corporations can have rights or they can’t. If it’s illegitimate to recognize that they have free speech rights, it’s equally illegitimate to extend them the right guaranteed by another clause in the same Amendment. And if they have the right to non-interference with publication, they must perforce also have free speech rights.

    But someone might argue, “We’ll only grant personhood to corporations that are formed to advance the individual and specific enumerated rights set out in the Constitution. Thus, publishing companies and incorporated churchs are persons (1st); the NRA (maybe?) is a person (2d); and so on. The Acme Widget Company, though a corporation, is not a person as it was not formed to advance a specific enumerated right in the Constitution.”

    Wonder how a strict constructionist (Abortion is not mentioned in the Constitution!!) would react to this argument?

  7. steve says:

    First, let’s be honest. This is not corporate free speech. It is the right of corporate executives and boards to use corporate money to support their political views.

    As I said below, I think a consistent interpretation of the Constitution means you have to give corporations that right. However, we give corporations, and those same executives special privileges in the corporate structure. The economy benefits (sometimes) from their improved ability to make money. It has been, for the most part, a fair trade. Now, these corporate execs want to use the corporate structure to make money AND influence political discourse. That is a real concentration of power into the hands of very few people.

    Steve

  8. Zelsdorf Ragshaft III says:

    No Sam, you and your ilk are just trying to limit free speech to those with whom you share an opinion. It is like a debating society where only one side gets to present their side. Corporations are owned by the public. If we do not like what they do, we can vote them out. Additionally, why is there outrage over what banks pay their employees, by contract, yet when Conan gets 45 million that is OK. To get a bonus working at a bank, something must have been produced. Conan, not so much. But then Obama is a student of Alinski and one of the rules is to have an enemy. Obama should and will be impeached for willfully violating the constitution. I hope.

  9. PD Shaw says:

    It might be worth quoting Professor Bainbridge on this topic:

    The idea that a corporation is a legal person with constitutional rights is, of course, a controversial one. Some commentators argue that it’s bad policy. In my view, however, it is a well-settled principle of US constitutional law and justifiably so.

    He then runs through the history . . .

  10. Dodd says:

    For instance, f&b persons can vote; why cannot a corporate person vote? An f&b person can sit on a jury; why cannot a corporate person sit a jury? And so on. The answers are not obvious.

    The answers flow from what I said in my post: “the statutes that created them confered upon them such trappings of personhood as were necessary for them to serve the purposes for which we need them.”

    A corporation isn’t an individual, so sitting on a jury isn’t possible (not to mention, that’s not a right, it’s a duty). They do, however, have the right to trial by a jury. That’s one of the rights we need them to have – to protect us as individuals using the corporate entity to further our purposes. Likewise, searches and seizures, Takings, counsel of our choice, and the like. The logic is the same as Sanchez put forward for the First.

    Voting is somewhat less obvious but it’s clearly an inherently individual right that doesn’t further the purposes for which we created corporations. When we coalesce into groups and form corporations, we do so as individuals. Speaking and owning property are things we need to be able to continue to do as that collective entity. But for the collective entity to vote would just be duplicative.

  11. sam says:

    He then runs through the history . . .

    Of course, there’s a textual problem here. The 14th says:

    All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

    I don’t think anyone reading that for the first time would suppose that the word ‘person’ in the first sentence means something different in the second, that, is a person is something that can be born or naturalized–things not possible for a corporation. And, indeed, every use of the word ‘person’ thereafter refers to a flesh and blood individual human. The framers may have wanted to include corporations, but a plain reading of the text doesn’t indicate that. Which is not to say that legal doctrine could not or did not develop to include corporations, but the text of the 14th, as I read it, doesn’t seem to.

  12. steve says:

    Just to put things in perspective, let us look at numbers. (I know, I know. Republicans hate that.)

    These are quickly gathered from the net, so please feel fre to correct.

    ACLU- Yearly budget. $85 million

    ACORN- Yearly budget. $30 million. Seems small. Wonder if they missed a zero? What the heck, make it $300 million.

    Greeen Peace- Yearly budget. $250 million.

    Putting this in perspective let us look at the recent profits for one quarter for everyone’s favorite corporation, Goldman Sachs.

    $5 billion.

    Also, since we are talking Constitution, doesnt it specifically enumerate the press as having special status? Wouldnt that imply that the NYT or WSJ has the right of free speech regardless of what the SCOTUS decides about for-profit corporations?

    Steve

  13. sam says:

    But for the collective entity to vote would just be duplicative.

    And then why wouldn’t the collective entity “speaking” be likewise duplicative?

  14. PD Shaw says:

    sam, the fourteenth amendment identifies three different categories:

    persons born or naturalized
    citizens
    persons

    Corporations aren’t citizens, nor are they “born or naturalized,” but they are persons. So nobody would claim corporations have the right to vote or enjoy the immunities and privileges of citizenship.

    The Professor’s earlier point was that the English law used and familiar to the Founders described corporations as persons, artificial, which would generally enjoy all of the same rights as persons, natural, other than those inconsistent with their character. And there is evidence, albeit slight, that when the Fourteenth Amendment was written, this usage was still in mind in protecting the rights of former slaves to organize corporations.

  15. Mithras says:

    Voting is somewhat less obvious but it’s clearly an inherently individual right that doesn’t further the purposes for which we created corporations. When we coalesce into groups and form corporations, we do so as individuals. Speaking and owning property are things we need to be able to continue to do as that collective entity. But for the collective entity to vote would just be duplicative.

    This is just hand waving. Corporations are formed for whatever purposes are set forth in the corporate charter and are permitted by the corporation law of the state in which it was formed. Couldn’t such statutes forbid corporations from advocating for or against a candidate? After all, we limit the ability of charitable organizations to conduct political activity in exchange for the privilege of not paying income tax. Is the constitutionality of that restriction now in doubt?

    There is no constitutional right to form a corporation, it is purely a privilege granted by state statute. It seems odd that a legislature could repeal its corporation law – effectively putting to death all companies formed under it without any due process at all – yet once a corporation is formed, the state may not take the lesser step of limiting what the corporation may do.

  16. sam says:

    PD, I’m not denying any of that, only that a plain reading of the text of the 14th doesn’t seem to include corporations. Now, that they’ve been brought under its protection, either via some statute or court decision, is established. But I don’t think the 14th on its face does that for the reason I put forward, that the word ‘person’ in the 14th always seems to reference individuals.

    Corporations are created by the state, and the state, according to SCOTUS, has granted them free speech rights. But note that these granted rights are just that, granted. I’m pretty sure Jefferson wouldn’t have included them in the unalienable rights we are endowed with by our Creator (had anyone thought to ask him).

  17. sam says:

    What I’m resisting is the idea the corporations obviously, as a matter of ontology, have rights. That a corporation is the kind of thing that has rights naturally, as we humans do. I don’t deny that corportions have rights. I’m only arguing that such rights as they have are the result of our having given them.

  18. PD Shaw says:

    sam, part of my disagreement lies in the fact that I believe these are also my rights as a listener to hear what there is to say about an election. I am not afeared that Goldman Sachs will tell me that Sarah Palin would be a great president.

  19. yetanotherjohn says:

    So Steve, I’ll trade you Goldman Sachs for all the others on the list. What a deal. Oh, but you only want some not to have free speech.

    Remember what this case was about. A documentary about a political person was censored. That is as core of political speech as you can get.

  20. Dodd says:

    This is just hand waving. Corporations are formed for whatever purposes are set forth in the corporate charter and are permitted by the corporation law of the state in which it was formed. Couldn’t such statutes forbid corporations from advocating for or against a candidate? After all, we limit the ability of charitable organizations to conduct political activity in exchange for the privilege of not paying income tax. Is the constitutionality of that restriction now in doubt?

    No, it is not just handwaving. I made an argument and supported it. I’m sorry you don’t want to agree, but that’s a perfectly rational distinction.

    As for charities, surely you see a distinction between limiting what special corps can do in return for getting tax-free status and the ordinary for-profit, taxed entity…?

    There is no constitutional right to form a corporation, it is purely a privilege granted by state statute. It seems odd that a legislature could repeal its corporation law – effectively putting to death all companies formed under it without any due process at all – yet once a corporation is formed, the state may not take the lesser step of limiting what the corporation may do

    Well, the sun could explode tomorrow rendering this all moot, too, but we don’t make constitutional law based on grotesquely implausible hypotheticals. There is a Constitutional right to freedom of assembly and there’s a right to due process. I’m just speaking off the cuff here, but I daresay I could construct an argument against outright repeal out of those facts, anyway.

  21. Herb says:

    “Either corporations can have rights or they can’t.”

    That’s ridiculous. So if Corporation X can’t buy off politicians, they have no rights at all!

    There are those who think this decision is a huge boon for freedom.

    That’s cool. Opinions can differ.

    But stow the “short-sighted and profoundly destructive” nonsense. The last 60 years have been “short-sighted and profoundly destructive?”

    No, the last 60 years have seen exponential increases in corporate wealth and personal freedom.

  22. steve says:

    “So Steve, I’ll trade you Goldman Sachs for all the others on the list. What a deal. Oh, but you only want some not to have free speech.”

    Nope, I said in my 5:44 comment that I thought this was the correct interpretation of the Constitution. I just think it has bad consequences for us. As you now see, corporations make much, much more than non-profits. I see lots more rent seeking coming up. Corporations, rather the executives who run them, will use their new funding source to further influence political outcomes to their benefit. We will see more Enrons and more subprime debacles. Part of the price of free speech.

    I have offered the partial solution of making those executives who engage in political dialogue with corporate money should lose their limited liability protections. Those are not a constitutional guarantee and are under the control of the legislature AFAIK.

    Are you happy with the idea of having a few thousand people controlling enough money to control our political dialogue?

    Steve

  23. Dodd says:

    That’s ridiculous. So if Corporation X can’t buy off politicians, they have no rights at all! …

    But stow the “short-sighted and profoundly destructive” nonsense. The last 60 years have been “short-sighted and profoundly destructive?”

    Those sentences don’t stand all by themselves. Taking them out of their context and replying to them as if they did doesn’t fly.

    The point of the former is that I anticipated the “the press gets an exception because it’s in the 1st Amendment” argument. Having rights is binary: either they can have them or they can’t; there cannot be some that do and some that don’t.

    As for the second, I was clearly not referring just to this ruling but to the utility of corporate personhood as a concept. That is, after all, what the post is about. So kindly send your strawmen back to the fields.

  24. Herb says:

    Aww, Dodd, c’mon, man. Blaming the reader for the writer’s poor choice of words is never a good strategy. I will agree, however, that those sentences don’t stand by themselves.

    They kneel.

    As for my field crew, perhaps I misunderstood your meaning, and if I did, I apologize. I assumed (perhaps wrongly) that since you’re defending the “utility of personhood” so vigorously, that you’re doing it being you think the Supreme Court’s decision is the bee knees.

    And yet, the same virtues that give corporate personhood “utility” in business are the same virtues that are almost guaranteed to cause havoc with our election results.

  25. Eric Florack says:

    I just think it has bad consequences for us.

    Such as…. what, exactly?

    As you now see, corporations make much, much more than non-profits.

    And you’d have that reversed?

    I see lots more rent seeking coming up. Corporations, rather the executives who run them, will use their new funding source to further influence political outcomes to their benefit. We will see more Enrons and more subprime debacles. Part of the price of free speech.

    The subprime debacles were a product not of private enterprise, but of An overly intrusive government, looking to buy votes from people who couldn’t afford loans. Similarly, putting limits on executive pay, for example, is all very populist, and so on, but do we really want to limit the corporation’s ability to fight for its own interests? That seems rather totalitarian, ala Hugo Chavez, just recently. Are the implications here, seemed to me extraordinarily clear.

    Are you happy with the idea of having a few thousand people controlling enough money to control our political dialogue?

    If that is truly the choice, I would far rather have that few thousand people be those whose interests are centered around growing the economy, creating jobs, and providing services, rather than a few thousand Progressives centered around Washington.

    I’d tend to doubt, however, that that’s really the choice. What we really have is a choice between a few thousand progressives settling the political agenda, the environmental agenda, and the value of free enterprise, versus free enterprise settling all those issues. It seems to me that the latter is what the progressives most fear. The big concern, here, isn’t that the voice of the people won’t be heard in such matters, but rather that the voice of the progressive won’t be heard. Those are two radically different things.

    After seeing for about the last year what progressives in power do to an economy, a government, a foreign policy, a world…. it seems to me we could do with a little limitation n their influence.

  26. Dodd says:

    Aww, Dodd, c’mon, man. Blaming the reader for the writer’s poor choice of words is never a good strategy. I will agree, however, that those sentences don’t stand by themselves.

    They kneel.

    Very droll. Nice attempt at slipperiness, but you knew exactly what you were doing.

  27. curveclimber says:

    @ Eric Florack

    You seriously think that the goals of Corporations align with yours? Or those of the United States? Corporations are about profit, short term, damn the consequences. Yes, we benefit from the economic activity they generate, that is if you don’t mind pollution, if you are careful to regulate how they treat their employees (like your bathroom breaks? those things are costly), and careful about a lot of other things. The jobs we count on them supplying can be shipped to India or Brazil or Mexico in a heart beat.

    So, now we have a system where corporations can spend billions getting politicians they want and laws they want. Are you really going to trust that this will work out well for you, your family and your community?

    I have seen enough of history to know that’s ill advised. Have you already forgotten Enron and and how it was able to affect the whole state of California?

    I suppose it’s all a moot point now because it looks like the only way this will change is a constitutional amendment and that would have to happen in the face of billions of corporate dollars advertising against it.

  28. Eric Florack says:

    You seriously think that the goals of Corporations align with yours?

    More than the leftist controlled government? Of course. And if the polling data is of any consideration, your point abour the rest of American agreeing with me would appear to be answered as well.

    Corporations are about profit, short term, damn the consequences

    Didn’t used to be that way. What’s changed? Governmental regulation, perhaps?

    So, now we have a system where corporations can spend billions getting politicians they want and laws they want. Are you really going to trust that this will work out well for you, your family and your community?

    Well, let’s see. Explain to me how this would be worse than the utter disaster that the left has foisted off on us this past year alone, much less the jobs lost to the left over the last several deacdes. As an example of such:

    Have you already forgotten Enron and and how it was able to affect the whole state of California?

    Perhaps you’ve neglected that the state government retaliated, and their economy is in shambles as a direct result of that and several other less than advisable moves on the part of the left??

  29. curveclimber says:

    Well, I appreciate your reply. But if you seriously believe corporate focus on short term profit is caused by too much government regulation rather than inherent in their formation, I’ll drop this here, because I see this won’t be a rational discussion.

  30. sam says:

    So, now we have a system where corporations can spend billions getting politicians they want and laws they want. Are you really going to trust that this will work out well for you, your family and your community?

    Well, let’s see. Explain to me how this would be worse than the utter disaster that the left has foisted off on us this past year alone, much less the jobs lost to the left over the last several deacdes

    Well, tell me, Bit, what would your reaction be if the corporation in question turned out to be controlled by, oh say, the Chinese? As far as I can see, a foreign-owned American corporation could plump for policies via its political advertising that were of primary benefit to the foreign government and not necessarily to us. What then? You don’t see a problem here?

  31. tom p says:

    Money is speech. We all (most of us anyway) agree on that. Some, me among others, don’t like it. Tuff shit. That is the way the constitution reads.

    So why don’t I like it? Because under this current reading of the Constitution (one which I agree with) some have more speech than others. For instance: I can stand up in front of my small town city council and speak about the “evils” of Wal-Mart 7 meetings in a row and end up spending time in jail for the last 5 of them.

    YET…. 3 Wal-Mart corporate “F’s can stand up at those same 7 meetings speaking of the “virtues” of Wal-Mart and no one would ever think of throwing them in jail.

    What is the difference?

    You got it: Money.

  32. Eric Florack says:

    Well, I appreciate your reply. But if you seriously believe corporate focus on short term profit is caused by too much government regulation rather than inherent in their formation, I’ll drop this here, because I see this won’t be a rational discussion.

    (Chuckle) I knew that, when you opened your editor. Seriously, though, shat has changed, do you suppose?

    Well, tell me, Bit, what would your reaction be if the corporation in question turned out to be controlled by, oh say, the Chinese?

    (Chuckle) I’d say they were about on par with the Clinton administration.

    As far as I can see, a foreign-owned American corporation could plump for policies via its political advertising that were of primary benefit to the foreign government and not necessarily to us. What then?

    Do you seriously consider that the only alternative to that occurrence is governmental intervention? Do you really suppose that there is no intelligence and the American people? That they cannot act in the interests of their country and of themselves absent governmental intervention? No wonder the left has such a problem understanding the American voter.

  33. sam says:

    Do you seriously consider that the only alternative to that occurrence is governmental intervention?

    Will you please get your head out of your ideological ass? Nowhere did I advocate government intervention. I just pointed out what I think is a potential problem for us in the ruling, and asked if you didn’t see it, too. Your one-trick pony mind is really something to behold.