The New York Times Discovers That Corporate Speech Isn’t A Bad Idea After All

New York Times writer Adam Liptak discovers that a Supreme Court decision protecting "corporate speech" might not be a bad thing considering that he works for a corporation.

Ever since it was handed down last year, the Supreme Court’s decision in Citizens United v. FEC has been the subject of unrelenting criticism from the political left ranging from the President of the United States himself (while the Supreme Court sat mere feet away from him) to average political pundits. When the decision was first handed down, for example, the New York Times published this editorial:

With a single, disastrous 5-to-4 ruling, the Supreme Court has thrust politics back to the robber-baron era of the 19th century. Disingenuously waving the flag of the First Amendment, the court’s conservative majority has paved the way for corporations to use their vast treasuries to overwhelm elections and intimidate elected officials into doing their bidding.

(…)

As a result of Thursday’s ruling, corporations have been unleashed from the longstanding ban against their spending directly on political campaigns and will be free to spend as much money as they want to elect and defeat candidates. If a member of Congress tries to stand up to a wealthy special interest, its lobbyists can credibly threaten: We’ll spend whatever it takes to defeat you.

This reaction from the Times’ editors pretty much mirrored what we heard from the political left in the wake of Citizens United, although so far none of their horror tales have come to pass. Now, with the one year anniversary of the decision having just passed, the Times’ legal writer Adam Liptak discovers that maybe the corporate speech doctrine set forth in Citizens United isn’t such a bad idea after all:

[The liberal] critique is incomplete. As Justice John Paul Stevens acknowledged in his dissent, the court had long recognized that “corporations are covered by the First Amendment.” Justice Anthony M. Kennedy, writing for the majority, listed more than 20 precedents saying that.

But an old and established rule can still be wrong, and it may be that the liberal critique is correct. If it is, though, it must confront a very hard question. If corporations have no First Amendment rights, what about newspapers and other news organizations, almost all of which are organized as corporations?

The usual response is that the press is different. The First Amendment, after all, protects “the freedom of speech, or of the press.” Since “the press” is singled out for protection, the argument goes, media corporations enjoy First Amendment rights while other corporations do not.

But the argument is weak. There is little evidence that the drafters of the First Amendment meant to single out a set of businesses for special protection. Nor is there much support for that idea in the Supreme Court’s decisions, which have rejected the argument that the institutional press has rights beyond those of the other speakers.

Moreover, as Justice Scalia noted in his concurrence in Citizens United, the idea that media corporation would somehow be entitled to greater First Amendment protection by virtue of the kind of business they engage in doesn’t make any sense historically:

It is passing strange to interpret the phrase “the freedom of speech, or of the press” to mean, not everyone’s right to speak or publish, but rather everyone’s right to speak or the institutional press’s right to publish. No one thought that is what it meant. Patriot Noah Webster’s 1828 dictionary contains, under the word “press,” the following entry: “Liberty of the press, in civil policy, is the free right of publishing books, pamphlets, or papers without previous restraint; or the unrestrained right which every citizen enjoys of publishing his thoughts and opinions, subject only to punishment for publishing what is pernicious to morals or to the peace of the state.” 2 American Dictionary of the English Language (1828) (reprinted 1970). As the Court’s opinion describes, ante, at 36, our jurisprudence agrees with Noah Webster and contradicts the dissent. “The liberty of the press is not confined to newspapers and periodicals. It necessarily embraces pamphlets and leaflets. . . . The press in its historical connotation comprehends every sort of publication which affords a vehicle of information and opinion.” Lovell v. City of Griffin, 303 U. S. 444, 452 (1938) .

Liptak quotes Eugene Volokh as putting the dilemma that critics of Citizens United face rather bluntly:

“If ordinary business corporations lack First Amendment rights, so do those business corporations that we call media corporations.”

Which brings us to the central issue of Citizens United, the issue of “corporate rights,” an issue that The Cato Institute’s Ilya Shapiro addressed shortly after the decision came out:

[The argument that corporations lack Constitutional rights] demonstrates a fundamental misunderstanding of both the nature of corporations and the freedoms protected by the Constitution, which is exemplified by the facile charge that “corporations aren’t human beings.”

Well of course they aren’t — but that’s constitutionally irrelevant:  Corporations aren’t “real people” in the sense that the Constitution’s protection of sexual privacy or prohibition on slavery make no sense in this context, but that doesn’t mean that corporate entities also lack, say, Fourth Amendment rights.  Or would the “no rights for corporations” crowd be okay with the police storming their employers’ offices and carting off their (employer-owned) computers for no particular reason? — or to chill criticism of some government policy.

Or how about Fifth Amendment rights?  Can the mayor of New York exercise eminent domain over Rockefeller Center by fiat and without compensation if he decides he’d like to move his office there?

So corporations have to have some constitutional rights or nobody would form them in the first place.  The reason they have these rights isn’t because they’re “legal” persons, however — though much of the doctrine builds on that technical point — but instead because corporations are merely one of the ways in which rights-bearing individuals associate to better engage in a whole host of constitutionally protected activity.

That is, the Constitution protects these groups of rights-bearing individuals. The proposition that only human beings, standing alone, with no group affiliation whatsoever, are entitled to First Amendment protection — that “real people” lose some of their rights when they join together in groups of two or ten or fifty or 100,000 — is legally baseless and has no grounding in the Constitution. George Mason law professor Ilya Somin, also a Cato adjunct scholar, discusses this point here.

Corporations don’t have rights because they are corporations. They have rights because they are entities made up of individuals who have Constitutional, and natural, rights. To accept the “no corporate rights” argument, one would also have to accept that individuals lose their rights any time they act as a group toward a common purpose. One would think that this would have come as something of a shock to Martin Luther King, Jr and the Southern Christian Leadership Conference, or the members of the American Civil Liberties Union. However that, and the rather ambiguous question of why a corporation that happens to own a newspaper possesses rights if a corporation that sells toilet paper doesn’t, is the reason that the Court was largely right in Citizens United, and why the critics arguments are so dangerous.

FILED UNDER: Law and the Courts, US Politics
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010. Before joining OTB, he wrote at Below The BeltwayThe Liberty Papers, and United Liberty Follow Doug on Twitter | Facebook

Comments

  1. Herb says:

    “They have rights because they are entities made up of individuals who have Constitutional, and natural, rights. To accept the “no corporate rights” argument, one would also have to accept that individuals lose their rights any time they act as a group toward a common purpose. ”

    No.

    I don’t believe many people are making a “no corporate rights” argument and if you think that’s what the opposition to Citizen’s United is based on, you should educate yourself a bit.

    The opposition is based on the fact that corporate executives can already exercise their free speech rights on their own. Thanks to Citizens United, they can now do it twice. Once in their name, and again in the name of their company.

    You don’t see a problem with that? Fine. Just don’t go making stuff about those of who do.

  2. Davebo says:

    I’ve gotta concur with Herb. My opposition to the ruling isn’t based on the fact that corporations have no rights.

    They have rights that individuals don’t have. Do you really believe that companies incorporate because they just love the state of Delaware?

    If corporations want to relinquish the special rights they have especially regarding limits of liability I’d happily welcome them to the ranks of individuals.

    But somehow I don’t see them making that leap.

  3. sam says:

    “Corporations don’t have rights because they are corporations. They have rights because they are entities made up of individuals who have Constitutional, and natural, rights. ”

    Where do I get my limited liability charter?

  4. MichaelB says:

    Sam, you have limited liability. It doesn’t matter how much you owe, your creditors can’t go after anyone else.

  5. sam says:

    Whew. That’s a relief.

  6. Moosebreath says:

    “Corporations don’t have rights because they are corporations. They have rights because they are entities made up of individuals who have Constitutional, and natural, rights. To accept the “no corporate rights” argument, one would also have to accept that individuals lose their rights any time they act as a group toward a common purpose.”

    Umm, no. Corporations are not just agglomerations of individuals. They have protections that agglomerations of individuals do not have (especially limited liability).

    Further, as Herb pointed out, the executives can exercise their own 1st Amendment rights. What Citizens United allows them to do is involuntarily exercise those of all of their shareholders by compelling the shareholders to support financially the political statements chosen by the executives.

  7. Herb says:

    “Sam, you have limited liability”

    Yeah, but do I have to incorporate in order to donate to my preferred candidate twice? Or can I just do it?

  8. Franklin says:

    There is little evidence that the drafters of the First Amendment meant to single out a set of businesses for special protection.

    I’m no lawyer, but the writer would have to offer alternate interpretations of the “or the press” clause if I’m to believe that the argument is weak. I’ll grant that there’s plenty of precedent against the argument. But the words are RIGHT THERE in the Constitution. Explain them.

    But really, Doug’s last paragraph is food for thought. The only good solution would be publicly funded campaigns, but that will never happen so why waste my breath?

  9. MichaelB says:

    I don’t think you guys understand limited liability. It serves to treat companies more like individuals not less. Both companies and individuals can only be forced to pay out what they have in terms of assets. If either can’t pay, the liability is limited in that there’s no recourse to the assets of anyone else.

    The idea is that I’m lending money to Sam, or GE. If Sam can’t pay, that’s tough for me. If GE can’t pay, again tough for me. In either case, I can push them into bankruptcy I guess, but that’s about all.

  10. Moosebreath says:

    MichaelB,

    Not really. The issue isn’t a corporation vs. an individual, but a corporation vs. a large number of individuals. In a business consisting of an agglomeration of individuals (such as a general partnership), each partner is liable for the entire debt, not just his share of it. That’s not true of a corporation, where each shareholder is liable limited to his contribution.

  11. sam says:

    No, that’s pretty much what I thought. But I think you’re just a bit off on the liability. If I’m an investor in CorpX, and CorpX is sued for some horrendous act of malfeasance, I’m only personally liable to the extent of my investment in CorpX. The creditors cannot reach beyond my investment to other assets (unless I was instrumental in some fraudulent action, etc. that was germane to the malfeasance). To fully analogize the individual’s position, wouldn’t you have to say something like, if I’m involved in an auto accident, recovery could only extend to the price of the automobile? And not to any other assets I may have?

  12. PD Shaw says:

    “I don’t believe many people are making a “no corporate rights” argument . . .”

    I’m pretty sure I’ve read hundreds of comments at OTB complaining that Citizens United made law by giving corporations constitutional rights.

  13. MichaelB says:

    Moosebreath,

    You seem to be agreeing with me. Limited liability is one of the key distinctions between a general partnership (need to be clear about general these days) and a corporation… and it is a distinction that results in the corporation being treated more like an individual in the eyes of the law.

  14. PD Shaw says:

    I agree with Doug on this, but would still go further. I, as an individual listener, am injured when the government restricts the rights of others to speak. My ability to shape my own thoughts and ideas is something that the First Amendment should protect.

  15. MichaelB says:

    Sam,

    I don’t think that’s the right analogy. Take a topical example: The BP Deepwater Horizon oil spill. Anyone harmed by it can sue BP, and they can take anything BP has, right up to the point where BP has nothing left and files for bankruptcy. (At least if they’ve been harmed that much). That’s the same as your car accident: the other driver can sue you for everything you have, if they’ve been harmed that much.

    As an investor in BP, you can only lose what you put in, but BP can lose everything. If you could only be sued for (say) the value of your car, that would be something like only being able to sue BP for the value of the oil rig.

    If we want to stretch out the analogy, as driver of the car you may be responsible for causing the accident. Likewise, if you’re CEO of the company and the explosion was partly a result of your negligence, you can be sued personally. But what if you’re a passenger on a plane? You and your fellow passengers paid the fare, but you’re not really in control. If the pilot runs over a luggage cart at the airport, you’d probably find it unfair to get hit with a lawsuit to fix the cart.

    With a widely held company anyway, you’re more like the passenger than the driver. IMO this is actually a much stronger argument against Citizens United than anything to do with limited liability – what if the “pilot” wants to drive you into spending lots of money on irrelevant elections? (This is just another variation on the principal-agent problem that is ubiquitous anywhere you have principals and agents.)

  16. Davebo says:

    That’s the same as your car accident: the other driver can sue you for everything you have, if they’ve been harmed that much.

    No, they can sue you for everything you have, as well as anything you may have in the future.

    That is the difference. Get a judgement against an individual. You could negotiate it in a bankruptcy, or you could choose not to and continue to attempt collection indefinitely.

    When BP shuts it’s doors, it’s over.

  17. jpe says:

    Thanks to Citizens United, they can now do it twice. Once in their name, and again in the name of their company.

    What? There’s no quantitative limit on free speech, is there? I’m having a hard time seeing how your criticism is even coherent. FYI: you should reply to me tomorrow; I think you’ve already used up your speech limit today.

  18. jpe says:

    I’m no lawyer, but the writer would have to offer alternate interpretations of the “or the press” clause if I’m to believe that the argument is weak.

    Freedom of speech = speech; freedom of press = writing. That’s what the respective terms meant in the day, as any annotated constitution will tell you. (they didn’t even have corporate media back then, I don’t think, so absent recourse to a time machine it’s impossible to read the terms otherwise)

  19. Herb says:

    “I’m pretty sure I’ve read hundreds of comments at OTB complaining that Citizens United made law by giving corporations constitutional rights.”

    Um…..so? An argument that Citizens United changed the interpretation of the law is not the same as an argument that says corporations have no rights.

    “. I, as an individual listener, am injured when the government restricts the rights of others to speak.”

    That may be true, but you don’t seem to understand that you’re also injured when the rich and powerful get a second voice because they control a corporate board.

  20. MichaelB says:

    Davebo,

    Not true. BP can file for bankruptcy and so can an individual. Either way if they can’t pay, they don’t have to.

  21. sam says:

    Ah, OK Michael, I see.

  22. Herb says:

    “they didn’t even have corporate media back then”

    Yeah, they did.

    “There’s no quantitative limit on free speech, is there?”

    When you’re talking campaign contributions, yeah. If you think Corporation X is going to use their new-found “speech” by writing an op-ed and not by flooding their preferred candidate’s campaign with cash, then you’re the type of dude who would say, “they didn’t even have corporate media back then.”

  23. PD Shaw says:

    Herb, I understant that the view that corporations have attributes which give them an “unfair advantage in the political process” and risk “corporate domination of the electoral process,” were expressed and rejected by the SCOTUS over thirty years ago as grounds for treating corporate political speech different from invidivual political speech.

    http://caselaw.lp.findlaw.com/cgi-bin/getcase.pl?court=US&vol=435&invol=765

    These new-found rights emenating from Citizens United are not new.

  24. Moosebreath says:

    MichaelB,

    “You seem to be agreeing with me. Limited liability is one of the key distinctions between a general partnership (need to be clear about general these days) and a corporation…”

    Agreed.

    “and it is a distinction that results in the corporation being treated more like an individual in the eyes of the law.”

    And that’s where the problem sets in. Remember, this all started as a response to Doug’s comment “To accept the “no corporate rights” argument, one would also have to accept that individuals lose their rights any time they act as a group toward a common purpose.” Doug’s statement is more of a statement that the members of a general partnership lose their rights to act together, and fails because of the differences. To the extent we’re saying similar things, it’s a reflection on how far off Doug’s statement is.

  25. Herb says:

    PD, I don’t know much about that First Bank case, but this statement:

    “These new-found rights emenating from Citizens United are not new.”

    is just not accurate. Citizens United was a landmark decision that dates back to 2010.

  26. jpe says:

    When you’re talking campaign contributions, yeah.

    We’re not, though. We’re talking about speech. Independent expenditures, not direct contributions. At any rate, you’ve gone over your limit; no speech for you!

    Yeah, they did.

    No they really didn’t. Publishers were individuals, not corps. Corps as vehicles for general business didn’t come into use until the antebellum era.

  27. MarkedMan says:

    If sole-proprietors had engaged in the shenanigans that went on at virtually every major bank in the US leading to the recent crash they would have gone to jail or at least payed major fines. Because those individuals worked for corporations, these shenanigans will only result in fines on the corporation. The people that made the actual decisions will not be punished in any way (OK, there are a few, very few exceptions to that, but it is true for the most part). So people can use a corporation to shield themselves from their own actions. I think this practical limitation of liability already goes to far. The Citizens United essentially made every major corporation in the world into a super-citizen, one that can engage in any action but no one ever has to pay the consequences of those actions. Not good.

    Follow this through: 100 people get together, form a corporation for selling ice to Eskimos. The officers of this corporation decide to use corporate assets to libel a political opponent. The political opponent sues. The company, having used all its assets in spreading the libel, goes bankrupt. The judge throws the case out of court because there is no one to sue.

    An odd effect of the Citizen United case may be that there is increasing pressure to hold corporate officers personally responsible for their decisions. This would be a good thing.

  28. jpe says:

    Just to preempt Herb’s next ill-considered reply: corps are still prevented by law from making direct contributions to candidates. That ban on contributions was not impacted by Citizens United, and corps still are barred from making those contributions.

  29. Herb says:

    “Independent expenditures, not direct contributions. ”

    You must think I’m dumb enough to think there’s a big difference there. I don’t care how the corporation tries to influence policy. I’d prefer that people make the policy and corporations make the profits.

    As to your understanding about the history of corporate enterprise, well….it seems incomplete. But maybe that’s just because I’m confused by the term “general business.” How is that different from specific business?

  30. jpe says:

    The officers of this corporation decide to use corporate assets to libel a political opponent. The political opponent sues. The company, having used all its assets in spreading the libel, goes bankrupt. The judge throws the case out of court because there is no one to sue.

    In that instance, the officer is personally liable, having personally committed the tort. Additionally, directors and officers are typically liable for the intentional torts committed under their supervision.

  31. Davebo says:

    Davebo,

    Not true. BP can file for bankruptcy and so can an individual. Either way if they can’t pay, they don’t have to.

    Actually, not true is the only phrase to describe your reply. Or have you forgotten about the recent changes to personal bankruptcy law?

    As an individual, you are on the hook… never mind. I thought we were conversing in good faith here.

    Delaware, they just love that state for no other reason……

  32. Davebo says:

    In that instance, the officer is personally liable, having personally committed the tort. Additionally, directors and officers are typically liable for the intentional torts committed under their supervision.

    Yeah, we see that happen every day right. Let’s be serious here. It doesn’t happen.

  33. Franklin says:

    jpe- Thanks for the clarification. Apparently that’s what I get for not owning an annotated Constitution.

  34. MarkedMan says:

    What davebo said. In theory officers are criminally liable. In fact, this happens so rarely as to be major news. Think about all the major criminal cases against the banks and traders. How have they been settled? Fines. But if an individual is criminally charged – they go to jail.

  35. mpw280 says:

    If corps aren’t entities, then neither are unions. I will agree that corps can’t donate when unions can’t extort money from members and then donate. Agreed? If not then you are delusional. mpw

  36. MichaelB says:

    Davebo,

    I am unaware of any recent changes that prevent individuals from filing for bankruptcy. Spare me your tripe about good faith, you’re just making things up now.

    The 2005 changes make it somewhat less pleasant to file for bankruptcy for individuals. But it’s always sucked. It also pretty much always sucks when a corporation files. In both cases they have the right to file, and their prior debts can be wiped away if they can’t pay.

  37. jpe says:

    @ Franklin — the Cornell Legal Institute has a great one, as does Findlaw. I’ve seen this question come up before, so I just happened to have looked it up before.

  38. Wayne says:

    Many of the “media” push their agenda including news organization, shows,movies, singers, writers, etc.

    If MSNBC can spew their stuff for hours on end why shouldn’t other corporation be able to take out some 30 seconds ads?

  39. sam says:

    BTW, I’ve been thinking about Eugene’s

    If ordinary business corporations lack First Amendment rights, so do those business corporations that we call media corporations.

    And it seems to me that he may have it wrong. I think one can point to First Amendment’s free press guarantee as implicitly saying, “Congress can restrict the speech rights of all business entities except for this kind of business entity (press).”

  40. Wayne says:

    Sam why should the corporate press and other media have free speech and not other type of corporations?

    That is about like saying only land owners should have free speech and\or voting rights.

  41. sam says:

    Did I say they others shouldn’t? I’m only asking this question: If the argument is that the right to free speech extends to all companies as a result of the First Amendment’s grant of free speech, why did the Framers feel it necessary to single out one particular kind of business for special note/treatment? And I’m suggesting that it’s possible they thought business in general did not have free speech rights, but wanted to make a constitutional exception for the press.

    How would you explain the explicit reference to the press, and only the press (as a commercial concern), in the First Amendment?

  42. Wayne says:

    Because the “Press” at the time which consists of printed newspaper and pamphlets were known to have been bully and\or shut down by governments who disagree with what they said.

    Anyone including businesses could distribute pamphlets or if they had a press a newspaper. They could stand on a box in the middle of a square and sell snake oil if they wanted to. Our founders wanted to make sure they kept their right to do so. In a way anyone who produced an advertisement or whatnot could be considered “the press”. One doesn’t have to have “news” in their title to deserve that tight.

  43. Wayne says:

    By the way if “Press” was only meant to only mean corporate press which would exclude many private papers at the time, wouldn’t that have been define somewhere?