by hilzoy
Via Brad Plumer and Unfogged comes this fascinating story:
“In 1997, the state of Pennsylvania began enforcing a weak waste-disposal law, passed at the urging of agribusiness lobbyists several years earlier, which explicitly barred townships from passing any more stringent law. It had the effect of repealing the waste-disposal regulations of more than one hundred townships, regulations that had prevented corporations from establishing factory farms in their communities. (…) In Pittsburgh and other large cities, powerful municipal treatment agencies, seeking to avoid costly payments to landfills, began contracting with corporate sewage haulers. Haulers, in turn, relied on rural farmers willing to use the sludge as fertilizer — a practice deemed “safe” by corporate-friendly government environmental agencies.
Pennsylvania required the sewage sludge leaving treatment plants, which contains numerous dangerous microorganisms, to be tested only at three-month intervals, and only for E. coli and heavy metals. Most individual batches arriving at farms were not tested at all. It was clear, from the local vantage, that the state Department of Environmental Protection had failed to protect the townships, turning many rural communities into toxic dumping grounds — with fatal results. In 1995, two local youths, Tony Behun and Danny Pennock, died after being exposed to the material — Behun while riding an all-terrain vehicle, Pennock while hunting.
“People are up in arms all over the place,” said Russell Pennock, Danny’s father, a millwright from Centre County. “They’re considering this a normal agricultural operation. I’ll tell you something right now: If anyone would have seen the way my son suffered and died, they would not even get near this stuff.” After a U.S. Environmental Protection Agency scientist linked the two deaths to a pathogen in the sludge, county supervisors tried to pass ordinances to stop the practice, but found that the state had preempted such local control with its less restrictive law. (…)
[I]n 1999, Rush Township of Centre County became the first in the nation to pass an ordinance to control sludge spreading. Haulers who wanted to apply sewage sludge to farmland would have to test every load at their own expense — and for a wider array of toxic substances than required by the weaker state law. Three dozen townships in seven counties have unanimously passed similar sludge ordinances to date. Citing a township’s mandate to protect its citizens, Licking Township Supervisor Mik Robertson declares, “If the state isn’t going to do the job, we’ll do it for them.” (…)
In 2000, the transnational hauler Synagro-WWT, Inc. sued Rush Township, claiming its antisludge ordinance illegally preempted the weaker state law and violated the company’s constitutional right of due process. It also sued each supervisor personally for one million dollars. In response, Linzey recalls, one township supervisor asked, “What the hell are the constitutional rights of corporations?” A year later, PennAg Industries Association, a statewide agribusiness trade group, funded its own suit against the factory farm ordinance in Fulton County’s Belfast Township on similar constitutional grounds. Rulings on both suits are expected as early as mid-2004.
It was only after those suits had been filed that the two Clarion County townships, Licking and Porter, took the historic step of passing ordinances to decree that within their townships, “Corporations shall not be considered to be ‘persons’ protected by the Constitution of the United States,” a measure that effectively declared their independence from corporate rule. For Mik Robertson, the issue is simple: “Those rights are meant for individuals.” He and his two fellow supervisors later revised their ordinance to also deny corporations the right to invoke the Constitution’s Interstate Commerce Clause; Porter Township is considering a similar amendment. Several other townships are preparing their own versions of the corporate rights ordinance, according to Linzey.
Now, when a corporation claims that an antisludge ordinance violates its rights, the townships can simply say those rights don’t apply here. The corporation would then be forced to defend corporate personhood in a legal battle. That hasn’t happened yet, but Linzey and his allies have energized a statewide coalition that has vowed to fight the issue all the way to the Supreme Court, raising awareness along the way about a basic question of sovereignty: By what authority can a conglomeration of capital and property, whose existence is granted by the public, deny the right of a sovereign people to govern itself democratically? Linzey predicts that such a suit could happen within a decade. That battle, he says, could ignite populist sentiment across the country — even around the world.”
I have to say: I would love to see the Congress preempt these legal debates by simply passing a bill specifying which rights corporations are entitled to, and which they are not. My understanding of the legal basis for corporate personhood is one step up from nonexistent, but as I understand it, it exists because corporations act like persons in some respects — i.e., they can own property — and because their being persons allows them to limit the liability of their shareholders. Corporate ownership of property and limited liability are fine with me. But I don’t see any reason at all why the way we provide for them, legally, should have ramifications like this:
“In 1994, for example, Vermont passed a law requiring the labeling of milk from cows that had received a bioengineered bovine growth hormone; in 1996 the federal courts overthrew that law, saying that the mandated disclosure violated a corporation’s First Amendment right “not to speak.” Four years later, a Pennsylvania township tried to use zoning laws to control the placement of a cell-phone tower; the telecommunications company sued the township and won, citing a nineteenth-century civil rights law designed to protect newly freed slaves.”
My problem here isn’t that I think that corporations shouldn’t have first amendment rights (though I don’t.) It’s that I don’t think they should have first amendment rights as a consequence of a policy decision on another matter entirely, namely, whether or not they should be able to own property, be sued, etc., and whether the liability of their shareholders should be limited. Nor should that policy decision prejudge the question whether a township can regulate their conduct or impose environmental restrictions on them. Those are separate questions, and should be considered separately. Taking them to be “persons” conflates them, makes the question which of the normal rights of individuals corporations have into a legal question to be decided by the courts rather than a political question to be decided by elected officials, and elevates some rights of corporations to Constitutionally protected rights, which is nutty. As Lizardbreath says:
“Rights like the right to equal protection under the law are in the Constitution for moral reasons — it is generally wrong to give one person lesser legal protection than another merely because of who they are, even if you make the judgment that you’d like to for policy reasons. Such rights are Constitutionalized to make it clear that they are not subject to casual change, and that such casual change would be wrong.
That moral reason doesn’t come into play at all with respect to corporations — participation in the corporate form is a privilege granted by the state, allowing investors to evade what would otherwise be their legal obligations. Conditioning that privilege on restricting the capacities or rights of corporations in a manner that differs from the capacities or rights of natural persons is morally neutral; the state didn’t have to create corporations at all, much less corporations with a right to legal equality to natural persons. From a policy point of view, it may be a good or bad idea in any particular circumstance to treat a corporation like a person, and legislatures should be able to decide when it makes sense to do so and when it doesn’t. But using the language of civil rights to talk about how how corporations have a Constitutional right to be treated appears to me to seriously misunderstand the moral underpinning of civil rights law, and the moral status of corporations.”
can a corporation own guns and kill people in self defense ?
can a corporation vote ?
can a corporation practice a religion ?
cleek: most important of all, can troops be quartered in a corporation’s home during peacetime?
A corporation doesn’t gain all the rights of people, it gains the rights that make sense for it acting as a representative of a group of people. So first amendment and contract rights are definitely in I would think.
can corporation A marry another corporation B, spawn baby corporations, then run off to another state, leaving corp B with full responsibilities for the children? can corporation B then re-marry ?
can a corporation be conscripted for service in times of war ?
if corporations are persons, does that include S-corps, too ? if so, does that make me (the Pres and sole shareholder of an S-corp) two people ? can S-corp me kill individual me, run off to Panama with my wife and spend my 401k on hashish and Patron ?
sooo many questions !
BTW, I can’t really understand the objection to the idea that corporations might have the right to due process. Do you think it would be ok to simply seize all the assets the ACLU on executive fiat for instance?
Seb: I’m less bothered by the substantive rights they have than by the idea of making the whole question turn on the judicial interpretation of ‘person’. Though I have to say that any set of substantive corporate rights that provides even a colorable argument that a township cannot ban a practice that has resulted in two of its inhabitants dying for fear of violating those rights seems excessive to me.
How could the supervisors be held personally liable for passing an ordinance? Don’t officials have immunity against being sued for performing their official functions? If not, then no one would ever be able to pass a law that a corporation (or sufficient rich real person) objected to without risking bankruptcy.
In South Dakota some wacko was trying to allow that sort of thing but required a ballot initiative, which fortunately was soundly defeated.
Cleek, corporations can’t be allowed to marry until we can definitively determine their sexes.
BTW, I can’t really understand the objection to the idea that corporations might have the right to due process.
Ah, but what rights are due? After all the township only needs a rational basis for the distinction between corporations and individuals. So even if they fight and win on the entitlement to due process argument they’ll still lose in the end.
So first amendment and contract rights are definitely in I would think.
I don’t see the argument for first amendment rights (or, rather, I strongly see the argument against it). The individuals who make up the corporation have all the first amendment rights they ever had; no one loses any rights through being associated with a corporation. The only question is whether anyone has a civil right to use the corporation’s assets to fund speech.
The argument that there is no such right seems obvious to me. The limited liability form is such a powerful tool for accumulating wealth, that if there were a right to use the assets accumulated within that form to fund speech, the state’s decision to create limited liability corporations would have had the effect of systematically privileging one set of viewpoints — those associated with corporations — against all other viewpoints.
If the individuals who own and work for a corporation want to say anything, they have a First Amendment right to do so, funded by their own assets.
“colorable argument” still makes me think of my kids fighting over the crayons. Even though I kind of know better.
I think the personhood of corporations is pretty silly; as hilzoy is (apparently, anyway) saying: let’s define which rights they do and don’t have. If they’re people, tax them at the upper-bracket rate.
Just kidding with that last. But only just. You can’t have it all.
LizardBreath, the people who use corporations to accumulate wealth often transfer some of that wealth to themselves individually, in which case they’d be free to use it to fund speech even under your analysis, so the corporation would still be privileging them.
On the other hand, what about various consumer organizations, advocacy groups, other nonprofits funded by donations from people who aren’t ultrarich? Should their supporters not have the ability to combine and amplify their voices by having their corporation spending money on speech?
I don’t see this as an easy issue.
The only question is whether anyone has a civil right to use the corporation’s assets to fund speech.
This “anyone”…are you referring to the corporation, or a specific human being?
Me, I’ve got slightly different issues with corporations using their money for politicking, but they’re not much different from my issues with corporations using their money for other things not directly related to the line of business. As I understand it, the BOD basically has discretion in using corporate dollars to do as it pleases, as long as it can build a convincing case.
But acting as if it represents a chorus of individuals exercising their free speech simultaneously, or whatever the current line is…well, I look askance.
Should their supporters not have the ability to combine and amplify their voices by having their corporation spending money on speech?
The ability? Sure, I think they should as a matter of policy. Should they have a Constitutional right to do so through the limited liability form? I don’t see the argument for it.
This “anyone”…are you referring to the corporation, or a specific human being?
Well, in reality, the decision to speak has to be made by a specific human being, at least until we make more progress in AI.
“The limited liability form”
Could someone cast a brief light on my ignorance, esp. on what a “form” is in this context?
“Though I have to say that any set of substantive corporate rights that provides even a colorable argument that a township cannot ban a practice that has resulted in two of its inhabitants dying for fear of violating those rights seems excessive to me.”
That is not the right in question so far as I can tell (without reading the complaint of course). The question is whether or not the township rule is preempted by the state rule, and if it is, it is a violation of the corporation’s rights with respect to the actually effective law. It is a violation of due process to hold it to a rule which is not actually legally effective.
I really think the idea that the First Amendement isn’t involved in corporations is an awful idea. Would you really be ok with the idea that the ACLU as a group could be banned from publically saying things if they pool their money? Forcing such pooling to go only to individuals strikes me as very restrictive to speech. Also, corporations have legitimate political interests. They are going to expressed. Far better to have them expressed publically.
Also, corporations have legitimate political interests.
No, they don’t. They have, in I’ve forgotten whose words, neither a soul to damn nor a body to kick, and they also don’t have any legitimate interests. They are legal fictions.
Their shareholders have political interests, and remain free to express those interests as they wish.
I’m going to go a bit further here and make a distinction between constitutional rights and common law rights. I think we all agree that common law rights are generally applicable to corporations – indeed even necessary to a corporate regime. By this I mean that corporations are entitled to access to the courts, enforcing contract rights, determining property ownership and so forth.
Constitutional rights are a whole other ballgame. These are granted to individuals alone. For example over at unfogged commenters have brought up a number of clauses that corporations supposedly need.
Contracts Clause: This is not what people might think, it merely forbids the state from interfering in contractual relationships. This is different than merely enforcing a contract.
Full Faith and Credit clause: This is a limitation of the power of the state courts and not an individual right.
Commerce Clause: I’m really at a loss to see how interstate commerce is involved in this instance. But I will merely go on to note that this is a constraint on local government and not a grant of rights.
First Amendment: This, as noted above, is a little more tricky but I don’t see any state passing a full-on ban of advertising. But yeah, it could be problematic. “in 1996 the federal courts overthrew that law, saying that the mandated disclosure violated a corporation’s First Amendment right ‘not to speak.'” Wow, can I assert the right not to speak on my 1040? (Just in case you’re wondering, no I can’t)
Equal Protection: This is, as I pointed out above silly, frivolous and doomed to fail. But it does provide me the novel theory in that I, as an individual, do not have limited liability rights of a corporation. I cry foul!
Due Process and Takings Clause: This is the most troublesome that I can think of because there is a real danger of one corporation using its influence to run a competing one out of business though government takings or bills of attainder.
Well, in reality, the decision to speak has to be made by a specific human being, at least until we make more progress in AI.
Hmmm…do you classify the BOD as a specific human being, or do you think the BOD has no power to make or override decisions to speak?
Or is there a third choice that I’ve missed?
“I think we all agree that common law rights are generally applicable to corporations – indeed even necessary to a corporate regime.”
ummm…
i think some dissatisfaction expressed here may have something to do with the very fact that we live under a corporate regime.
No, but I classify the directors as specific human beings, and they make the decisions for the corporation. I do apologize, abjectly, for having been unclear in saying ‘specific human being’ rather than ‘specific human being or beings’, and I’ll try really hard to be more precise in future.
I’m curious, though — was that lighthearted teasing pointing out that I was inexact? Or were you making some substantive point? (I suppose it’s possible that you thought I’d never heard of a board of directors, or was unfamiliar with the concept of arriving at a decision by voting on it. Was that it?) Because if so, I missed it completely, and it would be interesting to know what you meant.
“No, they don’t. They have, in I’ve forgotten whose words, neither a soul to damn nor a body to kick, and they also don’t have any legitimate interests.”
So if the ACLU wants to have a position on something, the only way it can do so is by having an individual solicit money to an individual (himself or someone else) so that individual can act? They can’t lobby against the Patriot act except as indivduals? The NAACP can’t fund attorneys for class action suits? This is far more revolutionary than you are letting on.
I’m curious, though — was that lighthearted teasing pointing out that I was inexact? Or were you making some substantive point?
Neither; just trying to understand what it is you’re saying. Not teasing, just not understanding.
As I’ve noted many, many, many times in the past, IANAL. I do, however, realize that there may be some shorthand of speech that I, not being a lawyer, am unfamiliar with.
And of course there’s always the possibility that I’m intrinsically annoying.
Rephrase: the possibility that my intrinsic annoying-ness is the source of the problem, and not any deliberate attempt to annoy.
rilkefan,
The “form” referred to is a form of business organization. There are several such, including primarily single proprietorship, partnership, corporation, and some variations.
One of the big advantages of the corporate form is limited liability. That is, the owners – the shareholders – have no liability for anything the business does, beyond the risk of losing their investment if it goes broke.
This makes it much easier to raise large amounts of capital. Investors know that there is a limit to what they can lose, and shares are more liquid than otherwise, because the same holds for a buyer in the secondary market. This is obviously a valuable privilege granted by law, and IIRC it is a relatively recent one, as such things go.
Sebastian, the topic under discussion is for-profit business corporations. They are organizationally and legally distinct from nonprofit advocacy organizations.
“In 1994, for example, Vermont passed a law requiring the labeling of milk from cows that had received a bioengineered bovine growth hormone; in 1996 the federal courts overthrew that law, saying that the mandated disclosure violated a corporation’s First Amendment right “not to speak.”
I don’t understand this at all. By the same logic, couldn’t all laws requiring product labeling be invalidated?
For that matter, is the ACLU officially chartered as a corporation at all? I had thought, pace Nell, that its legal status was something different.
So, some kinds of collective speech are good, while other kinds are bad?
Also: I absolutely despise the notion of corporate personhood and have done ever since I first heard of it. It’s always struck me as a heinously classist end-run around the Constitution and it needs to stop, the sooner the better.
“Sebastian, the topic under discussion is for-profit business corporations. They are organizationally and legally distinct from nonprofit advocacy organizations.”
That is a nice distinction to try for, but for the arguments above it isn’t worth much. See for example:
“I don’t see the argument for first amendment rights (or, rather, I strongly see the argument against it). The individuals who make up the corporation have all the first amendment rights they ever had; no one loses any rights through being associated with a corporation.”
and
“If the individuals who own and work for a corporation want to say anything, they have a First Amendment right to do so, funded by their own assets.”
Essentially you want to privilege those who have what you style political interests from those who have business interests. The idea that businesses don’t have ‘political interests’ is silly. We spend all sorts of time arguing that politicians get bought by corporations with no interests? Amazing.
And you want to be the arbiter of legitimate political interests that are allowed a voice and illegitimate political interests whose voice you will make illegal? I’m not on board for that.
You want to be the one who decides which conglomerate interests you will bestow the privilege of speech on and for which ones you will deny it?
Are we going to allow unions a voice? Why?
From the ACLU web page:
American Civil Liberties Union and ACLU Foundation:
What is the Difference?
The ACLU is comprised of two separate corporate entities, the American Civil Liberties Union and the ACLU Foundation. Although both the American Civil Liberties Union and the ACLU Foundation are part of the same overall organization, it is necessary that the ACLU have two separate organizations in order for the ACLU to do a broad range of work in protecting civil liberties. This Web site collectively refers to the two organizations under the name “ACLU.”
Although there is some overlap in the work done by each organization, certain activities the ACLU does to protect civil liberties must be done by one organization and not the other. This is primarily in the area of lobbying. The American Civil Liberties Union engages in legislative lobbying. As an organization that is eligible to receive contributions that are tax-deductible by the contributor, federal law limits the extent to which the ACLU Foundation’s may engage in lobbying activities. Therefore, most of the lobbying activity done by the ACLU and discussed in this Web site is done by the American Civil Liberties Union. By contrast, most of the ACLU’s litigation and communication efforts described in this Web site are done by the ACLU Foundation.
No. People have civil rights, including to right to free speech. They don’t have a civil right to the use of the limited liability form to fund that free speech. Under some circumstances it’s good policy to allow the use of that form to fund speech, under other circumstances it’s not.
See my comment at 3:58 for an earlier statement of the same thesis.
For those having trouble keeping up, suggesting that corporations ought not to have civil rights under the First Amendment is not equivalent to suggesting that corporations should not be allowed to speak under any circumstances.
Seb: “So if the ACLU wants to have a position on something, the only way it can do so is by having an individual solicit money to an individual (himself or someone else) so that individual can act?”
As a matter of policy? Sure, the ACLU (and the NRA, and whoever) should be able to do that. As a matter of constitutional law? No.
(cross-posted with LB making the same point, which gives me a certain amount of confidence, since IANAL and SI.
Although, I am making arguments about what I think the law should be, rather than what it is. So, even though IAAL, I’m not really arguing as such.
So the administration is not Constitutionally barred from silencing the ACLU? Really?
“For those having trouble keeping up, suggesting that corporations ought not to have civil rights under the First Amendment is not equivalent to suggesting that corporations should not be allowed to speak under any circumstances.”
For those who feel the need to snark, I ask: on what apolitical basis do you get to decide that corporations have too much power to have access to free speech? And you are awfully vague about the circumstances. According to you, they aren’t Constitutionally protected, so any legislature could ban them at whatever level they felt ok with. Right?
And corporations don’t have due process rights according to you, so differential treatment is okey-dokey too right? So Ford could get Congress to ban all speech by Japanese automakers doing business in the US, right? Microsoft could legally convince the US Congress to ban the speech of competitors and that would be ok right?
We can ban union speech right? Or are you going to make the perfectly considered apolitical judgment that union speech is a consolidation of speech that is protected based on your non-political judgment?
Bad terminology update. It is possible that you believe corporations have equal protection rights under the Constitution, which would invalidate the fourth paragraph.
Of course it would be interesting explaining why you think they have equal protection but not due process rights if you believe that.
I’d say that the government shouldn’t be constitutionally able to silence the ACLU. But it should be able to make it choose between silence and the limited liability form. I’m not sure why you’re having such trouble understanding this.
Likewise with unions, except that of course they aren’t limited liability corporations.
This really isn’t complex, Sebastian.
As the ACLU information page demonstrates, free speech varies by corporate form. That’s why the ACLU is not one, but two corporations. There does not seem to be an absolute right to free speech for all corporations. I know that a 501-3c cannot endorse a political candidate, for example. This because the legislation restricts it, not constitutional rights.
Correction 501-3c->501(c)(3)
The ACLU, NY Times, NAACP, are always the first organizations that get trotted out in these discussions–I’m never sure whether I ought to be persuaded. I do think they ought to be protected, but they also seem to fall directly into one of the other clauses of the first amendment other than the right to free speech: freedom of the press, the right to peacably assemble and petition, etc.
Commercial speech is one of the areas of law where I’m just not satisfied with any of the possible lines to draw. I don’t know much about it, granted, but learning more just made it worse.
A corporation doesn’t gain all the rights of people, it gains the rights that make sense for it acting as a representative of a group of people.
You understand that this is a very strong argument for giving corporations the right to vote? They do, after all, have a strong collective interest as to who does and does not hold office at every level from the municipal to the federal. This is really a lot more revolutionary than you’re letting on.
There isn’t an absolute right to free speech for anyone. I understand that. But to say that the free speech of corporations is completely not implicated by the 1st amendment seems ridiculous, unless you are willing to restrict all aggregated speech (which is clearly NOT contemplated by the Constitution as suggested by ‘the press’).
See also the Congress outlaws the speech of one company but not its competitor hypothetical. Do you really believe that no Constitutional right is implicated in that kind of case?
I’m frankly shocked.
“Commercial speech is one of the areas of law where I’m just not satisfied with any of the possible lines to draw. I don’t know much about it, granted, but learning more just made it worse.”
We aren’t even talking about commercial speech. I’m talking only about political speech facilitated by corporations. Commercial speech is a whole other ball of wax.
And if you are going to defend the ACLU with “the right to peacably assemble and petition” why wouldn’t any corporation count?
“I’d say that the government shouldn’t be constitutionally able to silence the ACLU. But it should be able to make it choose between silence and the limited liability form.”
What does that mean with respect to the ACLU? They have to take some sort of associative form in order to aggregate their political speech. Avoiding that is impossible without atomizing the venture.
Limited liability corporations are creations of the state, and an incredibly powerful way to amass wealth. It is reasonable to me that, as creatures of the state, they have no rights other than those the state chooses to grant them for policy reasons.
Other forms of voluntary associations, not granted special privileges by the state, are created by agreement among individuals, and the individuals that make them up have all the constitutional rights of individuals.
Where’s the confusion?
I suppose that was overly terse.
Picture the ACLU as a non-corporate voluntary association: Members A, B, and C donate money, and agree that officers X, Y, and Z would be entitled to spend that money and speak on behalf of the association. It has no legal privileges granted by the state — the only powers X, Y, and Z have are those granted by agreement with the membership. X, Y, and Z are exercising their individual rights to speak, and speak for the organization by private agreement. That speech should be fully protected under the First Amendment.
On the other hand, Corp Inc. is an artificial person created by the action of the state. It controls funds far greater than it would have been able to accumulate without the state’s decision to allow its creation and grant it significant legal privileges. It appears perfectly reasonable to me that the state should be able to regulate the manner in which the funds accumulated due to privileges granted by the state are spent on speech.
I don’t see why or how the power to amass wealth has anything to do with what legal rights a corporation might have.
I also don’t see why a partnership — whether under the common law or a partnership statute — is in any different position either with respect to ‘privileges’ of the state, or what constitutionalo rights it has.
Any entity that can own property can and should have protection from a taking of that property by the government without just compensation, whether or not some state corpoate charter says so or not. I regard this as a no-brainer.
Similarly, no property owner — whether human or legal — should have its property taken without due process.
It seems to me that you either have this right, or you have a situation where non-human entities cannot own property.
“It is reasonable to me that, as creatures of the state, they have no rights other than those the state chooses to grant them for policy reasons.
Other forms of voluntary associations, not granted special privileges by the state, are created by agreement among individuals, and the individuals that make them up have all the constitutional rights of individuals.
Where’s the confusion?”
How do they store the money? In a bank? How do the officers exercise control of the money? By voting like a board of directors? Can they save money for 5 days or do they have to spend it the day they get it? If one of the officers spends the money in an unauthorized fashion, are all of the other officers 100% liable? If one of the officers acts illegally can I sue the people who donated money?
It seems to me that you either have this right, or you have a situation where non-human entities cannot own property.
I’d say that’s a practical necessity to make non-human entities an attractive means of owning property by proxy; I just don’t see that that practical necessity should be constructed in terms of a civil right rather than just sensible policy.
Of course it would be interesting explaining why you think they have equal protection but not due process rights if you believe that.
I’ll give this a shot. Due Process, Equal Protection and Substantive Due Process are all different things although often intertwined (I hate con law so my explanation will probably not be the best) but for what’s it’s worth:
Equal Protection – this comes comes up when a law makes a prohibits action for one group of individuals but not another. For example denying felons the right to vote, or people under 21 the right to buy beer. Thing is that unless the classification is based on race, religion or gender (suspect classes) the law will likely be upheld. The law and classification need only have a rational basis founded on a legitimate state interest. And guess who determines what is and is not a legitimate state interest – that’s right, the legislature. So those sorts of laws are never overturned.
Procedural Due Process on the other hand ensures a fair judicial process before depriving someone of life, liberty or property. Yes, that last sentence doesn’t really say a whole lot – that’s what I hate con law. For example a trial where defense was not allowed to make a case.
Substantive Due Process prohibits legislatures from infringing on certain basic rights of individuals without meeting some stringent test that I can’t remember. Roe was partly based on this that laws prohibiting abortion infringed on the right to privacy and/or the right to make one’s own medical decisions.
For a better explanation here’s a wiki on Due Process procedural and substantive.
How do they store the money? In a bank? How do the officers exercise control of the money? By voting like a board of directors? Can they save money for 5 days or do they have to spend it the day they get it? If one of the officers spends the money in an unauthorized fashion, are all of the other officers 100% liable? If one of the officers acts illegally can I sue the people who donated money?
In a bank. Yes. According to the membership agreement. If that’s what the membership agreement says. According to the membership agreement (Say, membership agreement stating that moneys will be held in a separate account by the elected treasurer, and spent by agreement among the officers.) If they’ve acted wrongfully and you’re injured, sure. I can’t think of a basis for it, no.
Is the idea of a non-corporate voluntary association entirely new to you? Honestly, they’ve existed for centuries.
“Is the idea of a non-corporate voluntary association entirely new to you? Honestly, they’ve existed for centuries.”
Honestly, not new to me. New to me is the idea that you want to privilege them with rights not available to corporate voluntary associations. What you are trying to do sounds even worse than trying to censor speech based on the political content of the speech. You are trying to allow censorship based on your subjective political views of the character of the association.
The really odd thing is of course that many people want to privilege non-voluntary associations like unions while denying speech to other voluntary associations.
A corporation doesn’t gain all the rights of people, it gains the rights that make sense for it acting as a representative of a group of people.
I think Slarti has it right at 3:42:
.. acting as if it represents a chorus of individuals exercising their free speech simultaneously, or whatever the current line is…well, I look askance.
A corporation acts as a “representative of a group of people” only for limited business purposes. If I own shares in Microsoft it represents me with respect to how best to sell software, etc. But it certainly does not represent me for political purposes. I don’t think it should engage in political speech even if such speech is deemed to be advantageous to its business. Why not?
First, because political beliefs cut across financial interests. Not everyone just votes their pocketbook. It is overwhelmingly likely that some Microsoft shareholders oppose political ideas or candidates that would benefit Microsoft financially.
Second, financial interests conflict. A policy that helps some company might be broadly harmful enough that it is not even in the financial interest of many shareholders.
Third, individuals are free to act politically on their own. Those whose only concern in some matter is Microsoft’s well-being are free to pursue it, even forming an association for that purpose.
Fourth, when we talk of the power of a corporation we are talking of the power of a small group of people, the board and management, to use vast resources that they control but do not own, for political purposes. It is impossible, in any practical way, to distinguish between political activity that is motivated solely by business objectives and activity that simply reflects those individuals’ personal views.
So I think it is very sensible to restrict corporations free speech rights.
Note that in the case of advocacy groups the contributors – not shareholders – give money specifically to support certain causes, so these problems do not arise.
Honestly, not new to me.
Then what was the point of all of those questions? Surely you knew the answers.
I should just add that the reason I dismissed equal protection arguments is that, regardless of corporate personhood, the EP argument is going to fail.
Lizardbreath, why would you think that I couldn’t sue the donating parties? Agency theory stretches far nowadays.
Bernard:
“Note that in the case of advocacy groups the contributors – not shareholders – give money specifically to support certain causes, so these problems do not arise.”
Unless the cause is super-limited (Fund to purchase 500 copies of “Treasure Island” for the use of Dartmouth Elementary School) some of these problems do arise. And they absolutely arise in the cases of unions which are in many cases non-voluntary and certainly have all of the other problems you outline. Yet almost every freedom of speech theory advocated allows for unions to have a political voice. Most leftish thinkers would be appalled by the idea that unions should have no political voice.
“Then what was the point of all of those questions? Surely you knew the answers.”
No, I still don’t know the answer other than that you have political preferences that make you want to privilege some associative groups and disenfranchise others.
Lizardbreath, why would you think that I couldn’t sue the donating parties? Agency theory stretches far nowadays.
This is an area you practice in? I said I can’t think of a basis, but if you can that’s fascinating — a post on it would be really interesting.
No, silly, what was the point of the actual questions you asked and I answered about things like bank accounts.
Seb: I am amazed that you think this really ought to be a Constitutional right. I mean, what happened to originalism? Or did the people who got the 14th amendment passed really intend to secure the rights of corporations?
And I’m not sure what privilege you think the ACLU, if organized as a voluntary association without the corporate form, would have. Its members and officers would retain their individual rights — that’s all. Same for unions.
Yet almost every freedom of speech theory advocated allows for unions to have a political voice.
Well they have a voice only in as much as their members have individual votes (like corporate shareholders) and can make $$$ contributions to politicians and parties.
Take the money (union, corporate or otherwise) out of elections by way of public financing and I dare say many here would have no problem with first amendment rights for corporations.
That said Seb does make a good point in that it is difficult to distinguish between a non-profit advocacy org and a corporation since both have limited liability. But Bernard makes a good case.
Setting aside the free speech issues for the moment, I would be willing to accept some sort of compromise such as a choice between limited liability and constitutional rights (takings, privileges and immunities and such). You can have one or the other but not both.
Unless the cause is super-limited (Fund to purchase 500 copies of “Treasure Island” for the use of Dartmouth Elementary School) some of these problems do arise.
They arise in a vastly weaker form, so much so that, except in far-fetched hypotheticals, they are not much worth worrying about. We know what types of causes organizations will support, just as we know Microsoft is going to sell software. The NRA is not going to suddenly advocate gun-control measures. The ACLU is not going to argue that the government should subsidize churches.
And they absolutely arise in the cases of unions which are in many cases non-voluntary and certainly have all of the other problems you outline.
And I have serious problems with unions using members’ non-voluntary dues for political purposes, for similar reasons.
One of the most irritating cases I ever litigated included a defense against a claim that my client had caused a major corporation (you’d recognize the name) “emotional distress.” The plaintiff/corporation’s lawyer pled and argued this with a straight face, on the theory that since a corporation was a “person” it was entitled to all protections provided by the law. “Pain and suffering” apparently was to be equated to something like “costs and management burdens.” The caselaw was not clear – not surprisingly, no one had litigated such a thing before – and we settled before summary judgment. But I suppose once you equate a corporation with a natural individual for Constitutional rights purposes there is no clear reason you *shouldn’t* be able to make this kind of equation too. So where *do* we limit corporate rights, as opposed to those of natural individuals, or don’t we?
I have a somewhat passing familiarity with the legal issues involved, but not enough to weight in with any authority. Other folks can, and have, done so.
I’ll just offer the plain English version.
It is a fundamental doctrine of this nation that human beings possess, by virtue of being human beings, absolute and inalienable rights. Endowed by their creator, if you care to go that far.
Corporations possess the rights they are granted by law and by charter, nothing more.
Corporations are legal persons. They can own property, can buy and sell, can enter into contracts. They are not, however, people. They have no inalienable rights. None. Not one. They can do what we, the people, allow them to do. Nothing more.
If corporations are, as it seems clear to me they are, overstepping the boundaries of what is reasonable to grant them, it’s time to yank the leash.
If the law stands in the way of doing this, it’s time to change the law.
Thanks –
from the parallel thread at unfogged:
‘The question is,’ said Humpty Dumpty, `which is to be master – – that’s all.’
currently, we have allowed corporations to be our masters. some people on this thread have found corporations to be very generous masters, and are even paid, handsomely, to advocate their interests.
but as russell says, they have no inalienable rights, and are not the sorts of things to have such rights under the constitution.
and as he says, it’s time to yank the leash.
What Russell Said, with cheers following.
“Seb: I am amazed that you think this really ought to be a Constitutional right. I mean, what happened to originalism?”
I’m not sure what you mean by ‘this’. As far as I’m concerned, the free speech question shouldn’t turn on whether or not a corporation is a person. The first amendment isn’t just for individuals, it is for people in general:
‘Prohibiting the free exercise thereof’ isn’t a right just for individuals, it applies to groups as well. ‘The press’ is interpreted as both singular and plural. ‘Peaceably to assemble, and to petition the Government for a redress of grievances’ is a right of ‘the people’ which is both individuals and groups. I don’t see any reason whatsoever to believe that ‘free speech’ is the only phrase in the whole amendment which is to be applied only to individuals and not to groups.
Oh and I didn’t mean to ignore Phil. Pooling money for speech has an effective multiplicative quality. That is why people do it. You give up money that you could try to spend on speech individually, while pooling it helps focus. Giving up lots of individual votes so that the corporation can have one is a subtractive exercise, so I can’t imagine why anyone would ever bother. Coordinating votes by groups is what all sorts of political organizations try to do, and I suspect you aren’t objecting to that.
‘Prohibiting the free exercise thereof’ isn’t a right just for individuals, it applies to groups as well.
Unless I’m mistaken, the arguments for granting corporations the privileges granted to human persons under the Constitution are not predicated on a corporation being a group of individual human persons. They are predicated on the corporation being, in and of itself, a legal person.
If my understanding is correct, I think your argument here is not to the point.
Thanks –
Sebastian, the article Hilzoy quoted has a corporation rejecting a labeling requirement on First Amendment grounds. Do you support them on that or not?
Russel: “If my understanding is correct, I think your argument here is not to the point.”
Your understanding as to the application is not correct. The question should not turn on personhood so the question of whether or not a Corporation is a person is irrelevant to the apparently important idea that corporations ought not have First Amendment Rights.
Thanks-
“Sebastian, the article Hilzoy quoted has a corporation rejecting a labeling requirement on First Amendment grounds. Do you support them on that or not?”
Whether or not labeling requirements are permissible under the First Amendment ought not turn on whether the label is applied by an individual or a corporation. If labeling rules are appropriate under the First Amendment (I would tend to think so) they are appropriate as applied to individuals, partnerships, and corporations. Commercial speech law applies to entities engaged in commerce. These entities can be individuals, partnerships, corporations and I’m sure other forms as well.
I certainly agree with Russel’s of 9:50. But it seems to be to become a tautology. The state allows (either by statute or common law) an entity to become a legal person. Once it’s a legal person, legal attributes of personhood attach — notwithstanding any positive enactments of law.
I’m just missing the objection, I guess. What harm is a corporation doing that an individual human being can’t/wouldn’t do? If there’s no difference in the injury from any particular conduct, then what’s the rational basis for allowing the conduct on the part of the human individual and not on the part of the legal person?
To anonymous of 9:50, I would pose this question: may an individual (e.g., a business operating as a sole proprietorship) reject a labelling statute as an infringement on the First Amendment? If so, what’s the difference between that and allowing a corporation to do so? Stock ownership?
Okay, I’m in complete agreement with you about the labeling issue, but wasn’t at all clear on that from earlier comments. Thanks for clarifying. 🙂
hey, who started a legal thread without inviting me?
There’s a whole bunch of different things going on here that really need to be untangled.
Preemption — Even in California, where municipalities have constitutional existence, state law can over-rule local law, if it is clear that the intent of the Legislature is to adopt a uniform state-wide law.
This is a tremendously complex area of the law. Some areas of pre-emption are obvious, like traffic codes. Other areas, like the intersection between a regional problem — waste hauling — and the traditional local power over land use are much more problematic.
Corporate rights — Corporations are creations of statute. Absent the protections provided by statute, the owners of corporations (the shareholders) would be liable for the actions of their employees. This is standard agency law. Principals have been held liable for the actions of their agents for a very long time.
Granting constitutional rights to corporations — A truly hard question. A corporation is an intangible; there is still debate today (see Bainbridge’s blog) as to whether a corporation is a existing person or simply a nexus of contracts with particular statutory protections.
Corporations are not mentioned in the Constitution and cannot bear many of the incidences of citizenship. They cannot serve in the military or on juries. They cannot be imprisoned. By statute, corporations have a fiduciary obligation to their shareholders. So corporations cannot be altruistic or empathic except in furtherance of profit. A well-run corporation will, in fact, behave a lot like a sociopath.
The Sup Ct has held that corporations are persons. (Late 1890s if memory serves.) The Sup Ct has also repeatedly held that commercial speech is less protected under the First Amendment than other forms of speech.
What should the law be? I can draw an easy distinction between non-profit corporations and other non-corporate associations formed for non-profit purposes on the one hand and for-profit corporations on the other when it comes to lobbying. I would ban all corporate lobbying and ban corporate donations to non-profits for the purpose of lobbying.
(This was and may still be the law in Texas. Violating the law on corporate lobbying was what got DeLay in trouble.)
There’s more, but I’ve rattled on long enough.
Francis, suppose the statute confers upon a corporation the right to own property in its own name. This necessarily includes a right not to have the property taken without just compensation, and also the right to notice and an opportunity to be heard with respect to zoning (for example). Right? Without any further statutes.
Obviously, not every person is a citizen. One shouldn’t confuse the rights of citizens — natural human beings who meet certain qualifications — with those of persons.
As a personal matter, I’d prefer to call corporations something other than persons. Like, oh, “corporations”. My concern here is a simple one – “person” is an expansive word that connects to all kind of complexities. Once you say something’s a person, there’s a natural drive to treat it like just like real people. But nobody here actually wants to argue that corporations are or can be or even should be exactl the same as individuals in law and custom.
There’s one feature in particular I don’t want corporations to have, and that’s innate rights. I want them to have privileges and responsibilities, assigned by law and subject to modification by law. And I want to be able to talk about the terms of corporate operations without in any way suggesting that people’s basic rights are up for legislative negotiation.
That was me. Not sure where my name went.
What harm is a corporation doing that an individual human being can’t/wouldn’t do? If there’s no difference in the injury from any particular conduct, then what’s the rational basis for allowing the conduct on the part of the human individual and not on the part of the legal person?
Charley,
To me, a non-lawyer, the harm is in the agency problems I cite above. “Corporate speech” is in fact speech by corporate managers – agents – using assets belonging to shareholders. When corporate speech is political it will almost surely be in disagreement with the views of a substantial number of the shareholders, and may well not even be in their financial interests.
I can hear the cry of “sell the shares, then.” This is simply not a realistic solution to the problem, for many practical reasons.
One way to think about this is that while there is no good way for shareholders to operate the business as a group of individuals, there is no problem with them expressing their political views. So depriving the corporation of this right does some good – it prevents abuse of the agency relationship, and no harm, since no one is deprived of the right to speak.
Of course, if corporations have a constitutional right to free speech equal to that of human beings, then all that is irrelevant, but if there is a debate about that then I think the agency problems are important.
IANAL,
But de facto, corporations (at least 501(c)(3) forms) have limitations in speech that real persons do not. There is some argument about whether this is right, but it is undeniable that it is accepted law today. The assertion that a corporation has first amendment rights would surely negate those limits, wouldn’t it? Could an individual trade free speech for tax exemption? Don’t these exceptions prove that says that corporate speech is a privilege and not a right under current legal interpretation?
Editing got in the way of that last sentence:
Don’t these exceptions prove that corporate speech is seen as a privilege and not a right under current legal interpretation.
Typing this while LSU waxes Notre Dame. I can’t cheer for ND even though I grew up within rock-throwing distance of TDJ.
I think Slarti has it right at 3:42
Almost certainly by accident, or for the wrong reasons, or both. I think what I was getting at is not so much that corporations oughtn’t be allowed the same free-speech rights as individuals so much as that they oughtn’t be allowed to be spending corporate dollars on such things that don’t immediately forward the line of business.
One’s a legal argument, and the other’s just an expression of general disagreement. The notion that corporations can simply spend money at will, albeit with the complicity of the BOD, on such things that might not forward general shareholder well-being, but might instead allow them to (to pick a possibly horrible example) manipulate legislation to permit the sheltering of executive salaries or (more annoyingly) permit them to pillage their own pension funds…that’s just wrong.
I have no ideas as to how to legislate counter to the perceived wrong, though.
vocabulary and other issues:
In my professional capacity I represent a fair number of public agencies. Now, in certain obscure statutes, the word “person” includes public agencies. I’d like to strangle the Legislative analyst who first came up with that idea. In my professional writing, even though “person” often includes “public agency”, I use the word “person” to refer to humans; I use “entities” to refer to various corporate forms, and I use “agencies” to refer to various forms of public agencies.
Banning lobbying: Agencies of the state of California (DMV / Regional Water Quality Control Boards) are banned from lobbying. Appropriate? Most certainly. The agencies fall within the oversight of the Governor, as Executive. Constitutional? Why not? These agencies have no constitutional existence.
Nor do corporations. Nor, for that matter, unions. Personally, I’d be willing to require unions to itemize the dues statement, and allow members to opt out of that component of the dues which goes toward lobbying. If the idea is good enough for California attorneys, it’s good enough for union members. But I’d make that concession only if corporations were not allowed to lobby.
Just because we as a society refuse to give corporations the power to lobby doesn’t mean that we can take and revoke other constitutional powers at whim. To the contrary, once we grant a privilege to a corporation, I believe that the constitutional protections associated with that privilege must follow.
For example, corporations are granted the power to own property. But once we grant that power, the 4th and 5th amendments must attach. Once we make corporations subject to criminal laws, the protections of the 4th, 5th, 6th and 8th amendments attach. Etc.
Francis, I don’t get this:
Surely this isn’t true, some corporations can lobby, others cannot. See the ACLU page referenced above. The K street project makes no sense if corporations cannot lobby. As to automatic attachment of constitutional provisions to the artificial corporate entity, it’s simple, but I don’t buy it. We should only define privileges that make sense. These entities exist for our convenience. I don’t see having different property rights for a corporation and a human as intrinsically problematic. It may be practical, and best practice, but it is not a necessary condition for granting some property ownership.
I assume he meant “can refuse to give,” considering his sentence immediately prior to the one you quoted.
A lot of different concepts being jumbled together in the post and comments — my two cents.
Corporations are legal fictions that have the rights that are created by statute. LLCs were recently created to allow a more used friendly version of limited libaility company for closely held businesses. They did not exist 30 years ago. The fallacy is to pretend that once they are created, they become fictional “people” with certain inalienable rights. No — they remain our legal constructs with no inherent rights except that which is bestowed upon them.
Once you give them certain rights, other rights could not be denied. For example, if its OK to own property, then it cannot be taken by the government without just compensation.
Sure they can have free speech — so long as they surrender limited liablity. There is no constitutional right to conduct business in a limited liabilty entity. Sebastian is right as to the many problems with such a policy, but lack of wisdom does not then mean that constitutional rights must be bestowed in order to prevent unwise policies (of all people, Sebastian should recognize that constitutional rights do not arise so as to prevent unwise legislative policies).
Some have discussed above the practice of various advocacy organizations to have two entities. This is a perfect example in which certain legal privileges are withheld based on the exercise of free speech rights. Donations to entities that engage in certain types of advocacy activity are not tax deductible — so two entites are created in order to permit tax deductible giving to the one entity that avoids the type of advocacy that would deny donors a tax deduction. If corporations had free speech guarantees, how could tax treatment be made dependent on the nature of its speech?
Long long ago when corporations were disfavored in the law (pre industrial revolution), it was common for the law to limit their powers. For example, in many jurisdictions, they could not own real estate. REITs arose in that long ago era as a device to pool capital to own real estate.
Modern corporate law developed the idea of a corporation empowered to do anything, which implies that it should have the full spectrum of rights to protect its power to do anything. But nothing legally requires that it be that way — there is no constitutional requirement that if corporations are to be created, they must have full rights.
The sludge case has nothing to do with these questions — its a pre-emption question. A non-corporate waste hauler would have the same right to overturn local laws concerning sludge disposal as a corporate hauler. A crusade against corporate personhood is not going to make any difference in the sludge case.
Pre-emption is frequently an ugly tool used by large corporations to resist unwanted local regulation. Sometimes it makes sense (imagine if every county in your state could enact different laws concerning safety standards for trucks — it becomes unworkable, and we are better off with one state-wide standard, or nationwide in the case of federal pre-emption). Sometimes it is cynically used to permit the abuse as shown in the sludge case (though there are probably civil liabilities for the harm that results even though the practice cannot be banned in the first instance by the local community — there is some rememdy though not the better one).
The bovine growth hormone case link to opinion also does not turn on corporate personhood — non-corporate milk producers would also win that case. The idea of that case is that the State cannot require disclosure in commercial speech when it cannot identify any legitimate reason for compelling disclosure other than “consumer curiousity.” That is a very low standard to satisfy in order to uphold disclosure requirements, and what is notable about this case is the conceit of the majority opinion in finding that it was not met nby Vermont. The case reflects a clear example of conservative judicial activism — the appellate judges just chose to ignore the evidence presented by Vermont as to its reasons why consumers had a legitimate reason to known about use of the hormone in producing milk. They instead looked only to the Federal agencies which had certified the hormone as “safe” which thereby made any alleged concern by Vermont groundless. This is another form of pre-emption at work.
Giving up lots of individual votes so that the corporation can have one is a subtractive exercise, so I can’t imagine why anyone would ever bother.
Wait, wait — who said anything about “giving up lots of individual votes?” Corporate shareholders and officers can and do still speak and spend their own money outside the corporation, no? By your reasoning — [a corporation] gains the rights that make sense for it acting as a representative of a group of people — it should certainly gain the right to cast a vote — as Corporation, Inc. — for candidates friendly to its interests.
Charley: The harm in giving a corporation the rights of a natural person is that there’s a very good chance that the corporation is an immortal sociopath, likely to be wealthier than all but a very few natural persons — immortal and wealthy for obvious reasons, and a sociopath because blindly self-interested motives are the only ones easily conveyed from the owners to the managers.
You’re absolutely right that corporations wouldn’t be able to function usefully without some rights relating to property ownership — what I’ve been arguing against is the idea that those rights should be thought of as those of a natural person, with the same moral standing (and adjusted slightly to account for practical differences between corporations and natural people.) A coporation shouldn’t be able to claim to have a right merely because natural persons have the same right.
I’d prefer it if it were legally clear that corporations function with only the rights and capacities directly granted to them by the corporate law under which they function.
Almost certainly by accident, or for the wrong reasons, or both. I think what I was getting at is not so much that corporations oughtn’t be allowed the same free-speech rights as individuals so much as that they oughtn’t be allowed to be spending corporate dollars on such things that don’t immediately forward the line of business.
Slarti,
That really is very similar to my argument, and more succinct as well. You really have no escape from agreeing with me on this. Sorry.
Drat.
“Once you give them certain rights, other rights could not be denied. For example, if its OK to own property, then it cannot be taken by the government without just compensation.”
What makes you say this? From your framework it sounds like you could just change the law and take their property.
What makes you say this? From your framework it sounds like you could just change the law and take their property.
Why does that logically follow from my remarks?
You could change the law and require corporations to divest themselves of property. We could also outlaw corporations entirely, and require their existing wealth to be distributed to the shareholders.
The fact that these powers exist does not imply a right to expropriate property.
To restate my original point, if you are going to create fictitious entities and empower them with certain rights, you cannot make those rights inherently contradictory. If corporations can own property, then they would have the rights normally incident to property ownership.
And to refer to another example, if you are going to allow corporations to engage in free speech, it would be wrong to censor that speech based on content. But nothing requires in the first instance that these fictitious entities have free speech rights.
It should be emphasized that Texas already does prohibit some corporate free speech by making corporate contributions to state legislative candidates illegal. The power to limit corporate free speech is not an abstract idea, but one already in practice.
Fascinating discussion. It’s an issue I have thought about before, but I keep changing my mind. I see two interests in tension. On the one hand, Francis rightly points to the “sociopathic” nature of a well-run corporation, and suggests that it is nuts to give an entity like that full speech rights, due process rights, etc. And while courts have implicitly recognized that corporations cannot be considered normal persons, by carving out a vaguely-defined commercial-speech zone and allowing targeted restrictions on corporate campaign contributions. But courts have to paint with a broad brush, and the social harm caused by the leveraged speech power of corporate managers is not really the kind of problem courts are authorized to deal with. So it would, as Bruce says, be good to get the whole problem into the legislature, and create analogous speech & due process rights flexibly, by statute.
But there is a real problem with giving corporations only legislative rights: the legislature may arbitrarily treat different corporations differently. For instance, it could ban Greenpeace from speaking at all, while letting Mobil speak. Or vice versa. It could ban speech by any corporation that was a party to litigation against the state — eminent domain proceedings, for instance — so that corporate businesses could not give interviews or publish ads defending themselves. These are real problems.
It seems to me that most of the problems attributed to corporate personhood are actually problems with what the people running corporations choose to do, and which they could do almost as well through agents acting nominally as individuals, whereas the potential for abuse of corporate non-personhood is great. Therefore, I am, uneasily, in favor of the status quo.
Today, anyway.
Whoops, please delete “while” from my last comment.
“Why does that logically follow from my remarks?
You could change the law and require corporations to divest themselves of property. We could also outlaw corporations entirely, and require their existing wealth to be distributed to the shareholders.
The fact that these powers exist does not imply a right to expropriate property.
To restate my original point, if you are going to create fictitious entities and empower them with certain rights, you cannot make those rights inherently contradictory. If corporations can own property, then they would have the rights normally incident to property ownership.”
It isn’t a universal understanding that having property rights means that they can’t be seized by the government without just compensation. And by that I mean that it is only an understanding since we made a Constitutional point about it. But since you are arguing that corporations don’t have Constitutional protections, I don’t see why you get to claim that (and only that) Constitutional norm applies. Why not say, “they can have property rights enforceable against non-government entities but that the government can on whim ignore them”? What you are calling a property ‘right’ is the Constitutional protections of property. People and corporations and other organziations have millions of property-based transactions per day that never implicate the Constitution. The idea that government can’t willy-nilly seize property is not an inherent part of the definition of ‘property’. It is a constitutional protection afforded to property.
“It should be emphasized that Texas already does prohibit some corporate free speech by making corporate contributions to state legislative candidates illegal. The power to limit corporate free speech is not an abstract idea, but one already in practice.”
The really isn’t just a corporate thing. There are all sorts of (in my opinion ridiculously unconstitutional) limits on campaign contributions on people too. The fact that incumbents like to protect their own power isn’t just a corporate issue. It doesn’t turn on the personhood of the corporation. It turns on the odd historical twists which have made obscenity almost impossible to police while leaving the very core of the First Amendment–political speech–strangely open to regulation. (I’m not arguing for obscenity laws, merely noting the oddity of protecting that while chipping away at the core value of the political speech protection. If obscenity is to be protected under the 1st Amendment it is because we value political speech so much, and we find line drawing so difficult, that even obscenity would be protected.)
My lawyer grandfather used to say that a corporation is “an artificial person, created by law.” So maybe the lawyers here can answer this question: If people (i.e., shareholders) own a corporation, do they not then own a person? As such, are they not slave owners? And are they not then in violation of the 13th Amendment?
See, this is why I didn’t go to law school.
On the one hand, Francis rightly points to the “sociopathic” nature of a well-run corporation, and suggests that it is nuts to give an entity like that full speech rights, due process rights, etc.
Sociopaths don’t have rights?
It seems to me that most of the problems attributed to corporate personhood are actually problems with what the people running corporations choose to do, and which they could do almost as well through agents acting nominally as individuals,
But thsi distinction is crucial. To my mind the problems are precisely due to the use of resources belonging to others – an issue that seems to bother Sebastian in the case of unions but not here.
Corporate spech is nothing more than speech by corporate managers paid for by shareholders. “Restricting corporate speech” does not restrict speech at all. It merely prevents the use of other people’s money to pay for it without their approval.
“To my mind the problems are precisely due to the use of resources belonging to others – an issue that seems to bother Sebastian in the case of unions but not here.”
The case of unions is different because membership is not nearly as voluntary as investing in a corporation. The number of alternatives is much larger in the case of corporations. The marginal difference between changing your entire method of making a livelyhood to avoid a union and merely shifting money to another corporation to avoid a particular corporation is very different. But I don’t have a problem with union speech paid for voluntarily by union members. For those who are voluntarily a part of the union, I see no problem.
But since you are arguing that corporations don’t have Constitutional protections, I don’t see why you get to claim that (and only that) Constitutional norm applies.
I’ll say it again for the third time.
You could fashion a corporate law that forbids corporations from owning real property — its been done before.
But if you allow it to own property, then the constitutional rights associated with property ownbership would apply to your fictitious entity. The argument would be that you cannot create an exemption to constitutional protection for property ownership simply because the entity owning it is a fiction created by statute.
The point is that you can fashion the initial ball of rights given to a corporation as you see fit. But if you give it a certain right, you cannot then undermine the constitutional protections associated with those rights.
You are assuming that the protection for a corporation regarding ownership of real property must first evolve from the fact that you create the fictitious person, and either it has constitutional rights or it does not. No — the right stems from the choice made to grant the fictitious person the right to property ownership. That grant comes as a package that cannot be modified by statute to limit property ownership rights ijn violation of constitutional protections of property ownership. But you could still out of the box deny the corporation any rights to own prperty. It has no initial rights to own property.
Same concept applies for free speech. If you give it the right, then normal rules governing the right apply; i.e., no content based discrimination or no prior restraint rules (corporate press releases have to reveive prior approval, for example). But you could instead opt at the outset to simply deny it the right, period. Creating a fictitious person does not require granting it certain constitutional protections.
“Restricting corporate speech” does not restrict speech at all. It merely prevents the use of other people’s money to pay for it without their approval.
Yes, but my point was that even if you restricted corporate speech, a corporation could just have one of its agents make the speech as an individual, and then back him to the hilt if litigation ensued. Restricting corporate speech, or “personal” rights in general, wouldn’t really help. It’s a solution in search of a problem.
“I’ll say it again for the third time.
You could fashion a corporate law that forbids corporations from owning real property — its been done before.
But if you allow it to own property, then the constitutional rights associated with property ownbership would apply to your fictitious entity. The argument would be that you cannot create an exemption to constitutional protection for property ownership simply because the entity owning it is a fiction created by statute.”
You said it again, but you aren’t addressing the issue, you are asserting that ‘property’ means all constitutional property protections. That absolutely does not follow. The Fifth Amendment says: “No person shall… be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.” You claim that corporations are not persons, so the first clause cannot apply–even if you find that just compensation is required, DUE PROCESS OF LAW IS NOT. As for the second clause, if the government can ‘allow’ corporations to hold property or disallow them from holding property, there is nothing to stop them from defining an intermediate set of ‘corporately held property’ which does not count as ‘private property’ for 5th amendment purposes.
The 14th amendment is even worse. “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.” During the discussion of the rights of resident aliens, much notice is given to the fact that ‘person’ as quoted above is NOT “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.” as mentioned earlier in the amendment.
So if corporations are not persons, there is no obvious need for due process of law in taking their property. And it is not at all clear (and in fact I would assert it is false) to say that property owned by corporations MUST be considered ‘private property’ under the “all corporate rights are defined by statute” concept which appears to be advocated in the thread above by you and many others.
“The point is that you can fashion the initial ball of rights given to a corporation as you see fit. But if you give it a certain right, you cannot then undermine the constitutional protections associated with those rights.”
This point makes no sense as you outline it. Just fashion the initial ball of rights and exempt the constitutional protections you don’t like: Corporations can own property that is enforceable in contract against all parties except for the purpose of the takings clause. Corporations can engage in speech as long as it is speech I like. If it is all about initial definitions, there is nothing to stop you from Humpty-Dumptying any way you like.
I was nodding along with dmb all the way to the paragraph, and still may be in agreement with him: it depends on what he means by “right” in if you give it the right . . . If he means right to speak, I’m on board. If he means right of free speech, I can’t agree.
Sociopaths don’t have rights?
Immortal, fictitious ones don’t, in my book, at least not the full suite of rights attendant to an actual person.
The case of unions is different because membership is not nearly as voluntary as investing in a corporation. The number of alternatives is much larger in the case of corporations.
Avoiding investing in corporations whose political opinions you dislike is much harder than you make it sound.
Many investors hold shares through mutual funds or pension plans, so they have no way of even knowing what companies they are invested in. In fact, well over twice as many households own mutual funds as own individual equities.
Selling shares is costly. There are taxes and transaction costs (commissions may be negligible but the buy-sell spread is still there).
There are not so many choices as all that. Corporate political views are relatively uniform, especially within an industry.
Besides, I see no reason why the price of ownership of corporate shares should include subsidizing the managers’ expressions of their political opinions.
I’m sorry to have neen so sporadic. I’ve been on the road.
Count me in the corporations are persons column. I haven’t seen anything above that leads me to think that they should be treated any differently from other business forms, or from individuals, with regard to either due process or takings. Or the First Amendment: when the corporation is speaking, through its agent, it should enjoy all the rights of persons.
Now I’m on board with the concept that a state could create a special kind of corporation with diminished capacities of some sort. (Maybe NY would like to try this: I’m sure the Delaware Secretary of State would appreciate a little additional revenue). It’s not clear to me why someone would choose that form, unless there was some kind of tax advantage. But where the state creates an entity that has powers equivalent to a person, whether to own property, speak, sue and be sued, and the like, I don’t see any compelling reason why the Constitution apply to that person just as to any others. SH is right: ‘They might do things I don’t like’ isn’t how constitutional rights work.
If it is all about initial definitions, there is nothing to stop you from Humpty-Dumptying any way you like.
To which I say: so what? The question thus far hasn’t been, is it a matter of law that corporations are persons, it’s been, what manner of rights should a corporation have and in particular should they be accorded the status of “person” or not?
FWIW, I feel there’s a huge overlap between the arguments “corporations-as-persons” and “foetuses-as-persons” — I’ll give you all a moment to ponder the deft derailing of the thread about to ensue — which is that in both cases we have a class of entities which are demonstrably not “persons” in the usual sense of the term but to whom we would like to attach some measure of rights. [Possibly the full suite of human rights in the latter case, possibly not.] In both cases, the crux of the problem IMO is that people too often try to shoehorn the one category into the other, with disastrous results. The first step to a correct solution, to my eye, would be to explicitly create in the law a separate category for those entities then, and only then, debate about what rights should follow to that category. Otherwise you end with category errors all the hell over the place: does a foetus have the right to freedom of expression? Can the Walt Disney Corporation become a citizen of the United States and hence gaining voting rights?
This latter’s one of my favorites, actually. The Walt Disney Corporation (or pick your favorite American corporation, it works for all of them) was indeed created in the United States. If a corporation is a legal person then it stands to reason that its moment of creation as a legal person was its “birth” (which is, after all, the presumed underlying legal definition of same) and hence, by the Fourteenth Amendment, is a citizen of the United States, with the full suite of rights attendant thereto.
Which is bullshit.
So I’m pretty solidly with both dmbeaster and the anonymous Bruce Baugh on this one. Determine from the outset what rights we’d like corporations to have — and possibly subdivide into several subclass, which is the way things are right now AFAIK — and then refer to them as “corporations” (or “entities”/”agencies” if you want to include actual persons as well) in the law, affording them the protections that we decide, ab initio, we want them to have.
On the content of corporate speech, I find myself completely on the SH side of it, I think. There might be a dozen things I don’t like about how Starbucks is operating, and their support of candidates I don’t like is just one. I have no right as a shareholder (unless the articles give me one) to veto speech by the head of the company. Certainly no statute, and absolutely not the Constitution, provide me with such a power.
I suppose you can try to get the Delaware legislature to amend its corporations act, to give shareholders a veto on something. Good luck with that.
Charley: does a corporation have the (Constitutional) right to bear arms? [Which would be, what, a private arsenal or army?] Does it have the (Constitutional) right to avoid “involuntary servitude”, i.e. ownership, by another person? Does a corporation have the (legal) right not to be forcibly deprived of sustenance — which, for a corporation, would be capital? Etc, etc.
Oh, and here’s another fun one: can someone who sells off the assets of a corporation (similar to the 80s raider-traders) be charged with murder?
Personhood does not mean citizenship. A legal person cannot become a citizen, and incorporation is not birth.
But what if they were, you ask. What if 6 and 15 were the same number, I respond.
I’m not sure what to think about the issue as a whole, and of course IANAL, but I’ve been surprised that in this discussion Sebastian seems to be the one muddying the distinction between “constitutional” and “a good idea” — arguing that corporation’s rights must be constitutionally required because bad things might happen if they weren’t.
I think the second amendment probably does apply to corporations in the same way it does to individuals (ie, not at all). The thirteenth I have to think about — there’s certainly a due process angle.
‘Murder’ — or euthanasia via Chapter 7 — aren’t useful concepts, because they apply to natural persons. How can I tell? The same way I can tell that 6 and 15 are different numbers. Physical death is something well understood, and not the same as discontinuance of a business entity.
KC, I think it’s fair to say that huge and disastrous things would follow from stripping the corporate form legal rights it now is thought to enjoy. What I was responding to, though, is the suggestion that the reason corps don’t have rights under the constitution is that they might be immortal sociopaths.
Immortality isn’t really a problem — while corporations might outlast people, over the last 200 years it’s clear enough that this is just not that gig a deal. Sociopathy, on the other hand, is not limited to corporations. You deal with it the same way.
Immortal, fictitious ones don’t
Ok, but we’re talking about things that actually exist. Unless we’re not, in which case we’re just humping our collective fists.
Said with a smiley, natch. I mean, who wouldn’t be smiling?
Personhood does not mean citizenship. A legal person cannot become a citizen, and incorporation is not birth.
Why not? The Fourteenth Amendment says nothing about “legal persons”, nor is the concept to be found anywhere in the Constitution. It’s not even covered under an emanation or penumbra, since the entire fiction of legal persons is explicitly an attempt to give to non-natural-persons the rights of a natural person, with all the attendant properties thereof. By this logic, then, unless specifically stated otherwise in the definition of a “legal person” — which one cannot do if one wishes to accord to them the full suite of Constitutional rights, as you seem to be stating — all the rights of a natural person adhere to a legal person, since the law sees only the latter category and not the former (under equal protection, if nothing else).
This, in a nutshell, is why I oppose “corporations-as-persons”: because you’re right, it quickly leads to madness if you think about it too hard. The only option is to simply pretend both that corporations are persons when it suits one’s goals, and that they are utterly fictitious entities to which the usual notions of personhood — chief among them “life” — simply don’t obtain.
So, I ask, why bother with this schizophrenic charade? Why not simply declare that corporations are a class of entity unto themselves, to which we grant a certain suite of rights (freedom of speech, the right to property, whatever) and not others (liberty, freedom from servitude, deprivation of “sustenance”, etc)? Why this insistence that they are something that they are manifestly not, so much so that it reduces you to tautologies in defense of the inconsistency?
Added in proof: this question of personhood is fairly central in the SF community, where non-human persons are a matter of course. Consider, for instance, the case of a sentient robot; what constitutes its birth? What constitutes its death? Should someone who terminates it be held liable for murder? And so forth. [Peter Singer et al. also get into this with animals, not that I find his arguments terribly convincing.] The point is, to me, that if you’re going to call something a “person” it had better have notions of life, of death, of sentience and of free will attached to it — and your laws had better treat these as seriously as they do the similar notions amongst human beings — or you’re committing a category error of the gravest kind.
Ok, but we’re talking about things that actually exist.
A corporation is a fictitious person; it is not a fictitious entity. That’s the distinction on which my arguments are turning.
“I’ve been surprised that in this discussion Sebastian seems to be the one muddying the distinction between “constitutional” and “a good idea” — arguing that corporation’s rights must be constitutionally required because bad things might happen if they weren’t.”
I’m not saying any such thing. I’m discussing the way things would be if corporations were not persons to explore commenter’s understanding of what corporations as non-persons would mean. People upthread are making odd statements about what it would mean.
Legally, at this moment corporations are persons. We haven’t even talked about the cases that found it to be so. That status quo is being challenged by people above who seem to be arguing: corporations do things I don’t like, if they weren’t persons, they wouldn’t do the things I don’t like so I want to define them as not persons and try to smack down the things I don’t like. If we want to talk case-logic, research the cases and bring it on. So far as I can tell, I don’t see anything above that explains why, Constitutionally, it is incorrect to have found that corporations are persons. I’m engaging the discussion we are having–with people objecting to corporate things they don’t like and the idea that changing the current Constitutional understanding is a good idea. (Whether or not it is necessary because of some strict interpretational doctrine is an argument that would be rather difficult for many here to make considering their more free-form interpretation rules. But in any case no one has attempted it).
In the discussion there have been two major topics: free speech and property rights. I have argued that free speech has nothing to do with individuals vs. collective groups. The 1st Amendment is not solely about individual rights. It is about actions and conduct which are not to be prohibited. I don’t care what kind of entity is conducting the actions, the right to free speech and the press and the right of the people peaceably to assemble, and to petition the Government for a redress of grievances shouldn’t be messed with.
The private property issue came up from a different angle. It seems to me that it came up in the discussion as a “no Sebastian, this isn’t as radical as you think” kind of defense. But it is. Letting NON-PERSON corporations have control over something sort of like ‘property’ doesn’t mean that it is definitionally “PRIVATE PROPERTY FOR 5TH AMENDMENT PURPOSES”. If it is all definitions created purely by statute it could just as easily be “PRIVATE PROPERTY FOR ALL BUT 5TH AMENMENT PURPOSES”. It also suggests that corporate property could be seized without due process of law.
I say so not as an argument for the currently understood Constitutional principle that corporations are persons. I say so to counter the idea that changing the status quo on the Constitutional issue wouldn’t be a very huge deal.
A corporation is a fictitious person
So? I’m a fictitious car.
I’m thinking this “fictitious person” label doesn’t work, Anarch. And, sure, that’s the whole problem. Tacking on “immortal” and “sociopathic” doesn’t add anything.
If I take one orange, and put it next to five oranges, I’ll have six oranges. Therefore 15 equals 6.
The Constitution doesn’t have to say that corporations can’t be voters. Or slaves. It’s inability to be either is inherent in the nature of these terms. A corporation can speak, though agents, and it can be an owner of property — it’s purpose is to have the ability to act as a person, rather than a pass-through.
If I understand Sebastian and Charley (and I may not) their point is:
Corporations are persons and enjoy all the rights, including free speech, of human persons, even though some rights enjoyed by humans are meaningless as applied to corporations. This is a matter of Constitutional law, not legislation. Hence legislation cannot deprive them of these rights.
Is that more or less correct?
I won’t presume to speak for SH. I’d say that a legal person enjoys the rights that inhere in personhood, to the extent that they are not dependent on natural personhood. The Constitution prevents the state from interfering with certain rights of persons, whether they are legal persons or natural persons. Thus, the ownership of property is protected by both the Takings and Due Process clauses, regardless of which kind of person owns the property.
On the other hand, I think that a state is free to create a species of legal person that has a diminished status. The Constitution does not prevent this. That is, if new Jersey creates something called an LB corporation, that is not allowed to own any property (either real or intangible), that entity could conveivably have its illegal property taken away without compensation.
Having just written this, I’m not sure it would be true unless such a forfeiture is an explicit consequence of acts that are ultra vires. OK, so the legislation creating the LB corp has to say ‘they can’t own property, and if any purports to do so, it becomes property of the state.’
I can’t imagine why anyone would want to have such an entity. What’s it supposed to do? It can’t have inventory, bank accounts, intellectual property. It can’t pay employees, or distribute income to shareholders.
So? I’m a fictitious car.
Precisely; the only difference is that the law doesn’t recognize you as such, whereas it does recognize corporations as such.
wow am I baffled. SH, our resident originalist, is arguing that a particular kind of business relationship created by statute is a “person” for purposes of the Constitution.
You poll all 300 million americans and ask them if the Walt Disney Corporation is a person, and the vast vast majority will simply think you’re nuts. The rest won’t understand the question. Poll the same 300 million asking them whether the government should be able to seize Disneyworld without paying for it and the vast majority will say no (most of the rest won’t understand that question either).
There’s a point here, eventually. As a society, we mostly believe that corporations should have some / most / all of the protections of the Bill of Rights. At the same time, saying that corporations are persons is stretching common language beyond recognition.
So, assuming this is 1890 or so and the question is coming up to the SupCt for the first time, the court can simply assert that the Legislature invested “personhood” on corporations simply by adopting a corporations code.
This would be judicial activism.
Or, the court could say that the various Legislatures must determine the extent to which various corporate forms are entitled to constitutional protections and enshrine those protections in either statute or state constitutions.
or, the court could simply assert, without using the concept of personhood, that when the Legislature gives a corporation the power to do something that natural persons can do by right, then the Constititional protections associated with that right attach to the corporation as a matter of justice.
to tweak SH just a little, this blog and others have debated the term “marriage” at great length. SH has taken the position that “marriage” is so historically tied to the concept of the union of opposite sexes that the courts should not interfere when gays seek to marry.
If state legislatures have to sort out the rights and obligations of gay marriage, it seems to me that the same logic applies with equal force to corporate personhood.
I think it could be easily argued that the concept of marriage has been historically less fluid (and indeed more generally uniform) than the legal concept of personhood.
I’m not particularly impressed with the poll concept. If you polled people today, a large percentage of alleged ‘Roe v. Wade’ supporters think that late term abortions are in fact outlawed except in cases of rape and incest and that such a rule is a good thing. They are wrong on at least one count.
You also may be shocked to find that I think a wiretap is a search.
I’m not particularly invested in the idea of corporate personhood. As I said, I don’t think the free speech question turns on it at all. I’m pointing out that:
a) the ramifications are MUCH greater than people here originally seemed to think;
b) the distinctions people seem to want to make (i.e. inviolate property) make zero sense in the frame they are trying to set up.
c) the distinctions people seem to want to make for protected groupings don’t seem to make sense either.
And Francis, the worm turns both ways, the idea of you worrying about judicial activism based on strict interpretation is well…
Sebastian: So far as I can tell, I don’t see anything above that explains why, Constitutionally, it is incorrect to have found that corporations are persons.
Charley’s putting forth some decent arguments, he just doesn’t realize it yet 😉
Charley: It’s inability to be either is inherent in the nature of these terms.
In what way? A corporation could absolutely be a voter — through its agents, as before — and it can have its agential (? what is the word here?) autonomy revoked.
[And I still like hilzoy’s question at the top of the thread…]
Furthermore, I reiterate: the Constitution doesn’t distinguish between “natural persons” and “legal persons”; there are only persons. The term “legal person” is precisely intended to subvert the distinction to bestow upon corporations some of the status of natural persons without going through the requisite legislative (or Constitutional) process. I have no problem with corporations being granted a suite of rights; I have an enormous problem them being granted the status of personhood.
I’d say that a legal person enjoys the rights that inhere in personhood, to the extent that they are not dependent on natural personhood.
Then “legal person” isn’t a person at all, which is precisely my point.
Seb: “That status quo is being challenged by people above who seem to be arguing: corporations do things I don’t like, if they weren’t persons, they wouldn’t do the things I don’t like so I want to define them as not persons and try to smack down the things I don’t like.”
Well, probably some commenters take this view. But I, and Anarch, and others, are arguing something quite different: that it would be best if we decided what rights corporations ought to have without getting into this business of fictitious persons. (Also the further claim that this should not be a Constitutional question.)
To go all Anarch at the moment: there is a class of entities we call “persons”, of whom a subset are the class of “citizens”. We grant all persons in the class of “persons” a certain set of rights, so long as (CharleyCarp’s modification) those rights can coherently be extended to those persons.
What rights should we grant corporations? There are two ways to go here: (a) decide to call them “persons”, and thereby grant them the whole suite of rights we normally give to persons, unless some right cannot coherently be extended to them. Or (b) decide which rights they should have without dragging the question of personhood into it.
The second is better, I think, since it allows us to come up with whatever set we think best, without having to argue, in the case of a right we want to deny, that either (a) persons (including humans) really don’t have this right after all, or (b) it’s incoherent to extend it to corporations (it might not be), or (c) we have to grant corporations this right, since they are persons and we can;t consistently deny it to them.
(This is also compatible with dmbeaster’s point: that some rights only make sense as a package. Granting some entity the right to own property, but not to sell or use or develop it in any way, would make no sense. OK: then we should decide which packages of rights to extend to corporations without dragging the concept of personhood into it.)
It is not a response to this argument to say: but OMG then someone might stop the ACLU from expressing views! Leaving aside the fact that this is a very odd response to hear from an originalist, it’s also not to the point. My point was not: all the rights of persons should be stripped from corporations. It was: we should decide which to grant to corporations without dragging the status of persons into it. I can perfectly well go on to say: once these various rights are disaggregated, I will of course defend the idea that corporations should have some of them; possibly the exact same set they now enjoy. That’s because the question which rights should corporations have is a different question than: should we have the flexibility to decide which rights they have or be limited to granting them either the set of rights enjoyed by persons or none at all (or perhaps some third set recognized by common law — the rights of animals or enduring trusts or kingdoms or something.)
Shorter me: I’d rather order a la carte, not prix fixe.
In what I wrote above: for “persons in the class of “persons” “, substitute the more coherent “beings in the class of “persons”.
Here is a Wikipedia article on the subject: Corporate Personhood. It provides some history and more context to the discussion. The lawyers here can pick apart the inaccuracies.
Hil, what rights would you not give a corporation, and why? If you’re going to make the rights derive from statute, how are you going to get states to have the same statutes? Or will Maryland corporations have different rights than Virginia corporations? When they’re both acting in Maryland?
Who do you think is going to write the statutes, and why do you think they’re going to limit the rights of corporations?
Jay S, the author of the wiki piece might be shocked, shocked to learn that the 14th Amendment is about more than the rights of former slaves.
If you’re going to make the rights derive from statute, how are you going to get states to have the same statutes? Or will Maryland corporations have different rights than Virginia corporations? When they’re both acting in Maryland?
I can’t speak for hilzoy, any more than you can for Sebastian, but I don’t see why this is a problem. Laws governing corporations already differ across states, and yet the Republic lives.
CharleyCarp: I’d prefer federal legislation governing corporations that engage in interstate commerce. (Isn’t that the situation now? Or were the stories I used to hear, when I lived in LA, about people being inveigled into various schemes for tax avoidance that involved setting themselves up as corporations in Nevada just fictions?)
I’d be fine with granting them the rights they have now, with the exception of free speech (in the case of for-profit corporations.) Possibly I’d say something different if I knew anything at all about corporate law. I just don’t want the move from ‘they’re persons’ to ‘therefore, they must have this further right’ to be available; I want it to be determined by the Congress.
Corporations are chartered by states. Often Delaware, regardless of the location of the company’s operations. People who want to regulate the rights of corporations through their charters are either going to have to have federal chartering of corporations (there are a very few of these, each with its own act of Congress) or get Delaware and your state to agree.
And for what?
Bernard, the Republic can live with differences in state statutes because things like whether the corporation can publish a newspaper, or own property without state interference, are not based on which state they are incorporated in.
Hil, I don’t understand why you think the Washington Post shouldn’t have rights under the First Amendment. Imagine if New York Times v. Sullivan had gone the other way.
with the exception of free speech
How, approximately, would you go about curtailing corporate speech, hilzoy?
I’m not completely against this, mind, just wondering how it could possibly be executed in statute.
I was being imprecise: I don’t think that for profit corporations should have a right to engage in speech. (The WaPo is arguably different, being protected under the first amendment qua press.) I am absolutely fine with things like restrictions on commercial speech, and restrictions on some corporations (I am thinking, now, of (say) General Mills or Bob’s Body Shop) enaging in political speech, though of course the individuals who own or run or are employed by corporations would retain their Constitutionally guaranteed rights.
I don’t particularly want to curtail them at the moment — I might, if I thought more — but I do not think that they should have a right, qua corporation, to engage in political or commercial speech.
To go all Anarch at the moment…
And Anarchitude has never looked so good!
Charley, after reading the discussion page for the wikipedia article, it’s apparent that the original author was trying to shock the reader. A 14th amendment dispute is addressed there. There’s been extensive clean up on the article, but much seems left to go.
The time lines of court cases and the evolution of the view of applicability of rights to corporations seemed helpful though, assuming it’s factual. But it’s Wikipedia.
“I was being imprecise: I don’t think that for profit corporations should have a right to engage in speech.”
I don’t understand this at all. What is it about the first amendment that makes you think it shouldn’t apply to corporations.
What is it about the first amendment that makes you think it shouldn’t apply to corporations.
The text of the First Amendment reads; “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or 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.”
Hard to see why any of those items should apply to a corporation. Can you justify why you think they do?
I already did above. Every single clause in the first amendment is for both individuals and people in aggregate. ‘Free exercise thereof’ is not solely an individual right. ‘Of the press’ is not solely an individual right (and as interpreted in the modern world is rarely an individual right). ‘Right of the people peaceably to assemble, and to petition the Government for a redress of grievances’ is not individual (and sounds to me like it would allow corporate political speech and corporate access to the courts). If every other clause applies to people both individually and in groups, I don’t see why “freedom of speech” should be the only clause with a restrictive individual cast to it.
But where the state creates an entity that has powers equivalent to a person, whether to own property, speak, sue and be sued, and the like, I don’t see any compelling reason why the Constitution apply to that person just as to any others.
I agree with this — the whole point is when creating the fictitious person, is it granted powers equivalent to a person. If that is done, then Constitutional guarantees apply. Sebastian seems to think that if you can define the initial package of rights that corporations are given, then you can also re-define the rights themselves; i.e., you can own property but subject to the right of the government to confiscate it without compensation. I don’t think that problem exists — it is not that hard to distinguish between whether or not a fictitious entity is given basic rights as opposed to someone improperly redefining those rights when allegedly granting the initial package of rights.
I think it is clear that it would be unconstitutional to pass a law indicating that an individual cannot own real property. But it is clear that a corporation can be denied the right to do so. But that concept does not imply that you can allow corps to own property, but subject to taking without government compensation.
_________________________
Thomas Jefferson wrote:
We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.
There is no doctrine that says that all corporations are created equal, that they are endowed by their Creator with certain unalienable rights, etc. Simply saying it points out the silliness of the idea that corporations are inherently somehow the equals of natural persons.
They are literally our robots, created to serve our purposes with no inherent rights once created except those that are created with them. I think if you do create them with certain powers and rights, you undermine the Constitution by saying that they do not have the rights normally associated with those held by natural persons with such rights. But nothing inherently requires that corporations be viewed as the legal equivalent of people simply because they have been created.
As for the utility of fighting back against corporate abuse by restricting their rights, I don’t see much utility in the concept. It is better to regulate the actual problem than trying to undermine corporate abuses by redefining their basic legal status.
I know that there is a populist streak that likes to trace the problem with corporate abuses to the legal concept of treating them like people. But I am not on board with that concern.
“If that is done, then Constitutional guarantees apply. Sebastian seems to think that if you can define the initial package of rights that corporations are given, then you can also re-define the rights themselves; i.e., you can own property but subject to the right of the government to confiscate it without compensation. I don’t think that problem exists — it is not that hard to distinguish between whether or not a fictitious entity is given basic rights as opposed to someone improperly redefining those rights when allegedly granting the initial package of rights.
…
But it is clear that a corporation can be denied the right to do so. But that concept does not imply that you can allow corps to own property, but subject to taking without government compensation.”
I still don’t understand that. Why could you not define the holding of corporate stuff as not full fledged private property, and subject to taking without compensation? Since you are positing that we could deny the right to hold property at all, why could you not deny the right to hold “private property” and just not define what corporations hold as “corporation property” which would not be subject to Constitutional limitations on property?
I don’t see why “freedom of speech” should be the only clause with a restrictive individual cast to it.
I don’t either, but that overstates things. I think the argument is that when the state creates forms of organizations that have special privileges it may also impose restrictions. So some non-profits enjoy tax privileges, for example, but only for specified activities. (Indeed, the very term “non-profit” is misleading. Universities, for example, often make a profit. The issue is what purpose the profits are used for)
Why normal business corporations don’t, or shouldn’t fit into that mold with respect to a restriction on political activity is something I don’t understand.
there are actually two questions here, no?
1. do corps. have a constitutional right to freedom of political speech?
2. is commercial speech less protected by the first amendment than political speech?
I agree with Katherine, and would amplify point 2 by noting that commerical speech rules apply to individuals, partnerships, corporations and any other entity engaged in commerical business communicating with customers. So the question of commercial speech is a question of the limits of free speech as applied to everyone. The fact of commercial speech rules says nothing about the question of whether or not corporations should/do have the right to freedom of political speech.
Though the question of personhood could still be important if a legislature made discriminatory speech rules allowing one company to engage in commercial speech while restricting that of its competitors.
I still don’t understand that. Why could you not define the holding of corporate stuff as not full fledged private property, and subject to taking without compensation?
Because one of those activist judges will look at your proposed scheme, and say it does not legally work as a matter of consitutional law. That it makes no sense as a matter of the constitutional rights in owning property to define a subclass of ownership for corporations that is allegedly exempt from the constitutional protection.
These kind of definition games are basic in the law — a famous area for that is tax law in which the definition is the name of the game.
Another example would be time, place and manner restrictions on free speech, which are proper, that are instead being used to circumvent the basic right to free speech. A classic recent example is “free speech zones.” Someone has to decide whether or not the restrictions are in fact proper time, place and manner restrictions, or are a subterfuge for denying basic speech rights. The legislative body has the power to enact time, place a manner restrictions, but cannot use that power to define “free speech zones” in such a manner so as to eliminate effective use of the right. Courts have forever been punching holes in such rhetorical game playing with definitions.
In other words, the power to make definitions does not imply the power to define away the basic right itself with loopy definitions.
dmbeaster, if the right for corporations you’re talking about is one that’s simply created by legislation, then it’s not a constitutional right (or “basic right”), and I don’t see why it wouldn’t be possible for it to have whatever restrictions the legislators wanted to put on it. You’ve gone back and forth several times with Sebastian on this, but your explanation hasn’t gotten any clearer to me.
Though the question of personhood could still be important if a legislature made discriminatory speech rules allowing one company to engage in commercial speech while restricting that of its competitors.
I don’t think that it makes much sense to deny corporations free speech, but I don’t see that they inherently have the right.
However, I also don’t see Sebastian’s concern as a problem. If they are given the right, then you can’t hinder the right with content based or prior restraint restrictions, which are probably what is implicated by Sebastian’s example.
The question of personhood needs to be put in context. So many of our constitutional provisions were written in an era when no one thought about whether or not corporations had such rights. They were disfavored and not used much, and I doubt that anyone was thinking about corporations being protected when using the word “person” in various provisions of the Constitution.
Now that we have a modern view of corporations with a broad range of powers, the question is whether the “persons” protected include corporations. The debate about personhood has arisen in this context — a problematic one because of the need to adopt old language to new circumstances. A true literalist relying on original intent would probably have to conclude that a corporation is not a “person”. I don’t know how much legal scholarship exists on this question (I do know that 19th century lawyers made that argument unsuccessfully to the US Supreme Court with regard to the 14th amendment).
The fact that we are stuck with this arcane debate about whether modern corporations are “people” as that term is used in various Constitutinal provisions does not mean that the bigger issue is stuck with that debate. The issue only exists for a modern corporation that is authorized under law to do any lawful act, but nothing requires that particular form of corporate power.
I other words, corporations are “persons” for purposes of these rights only to the extent that we chose to make them such, but if we do give them broad powers, they get these rights.
Why could you not define the holding of corporate stuff as not full fledged private property, and subject to taking without compensation
State of California v Disney Corp.
on cert to US Supreme Court, on the question of the applicability of the 5th Amendment to the State’s seizure of Disneyland.
State argues that no just compensation is required on the grounds that Disney Corp is not a “person”. There is no federal law of personhood. State law should govern, and the corporation code nowhere states that corporations are persons.
Disney responds that the Bill of Rights has always protected both individuals and associations of individuals, that Disney is such an association and that taking Disneyland without paying for it directly reduces the share value of Disney Corp., thereby taking the property of individual shareholders.
California counters by saying that the owners of Disney have availed themselves of a particular legal structure that gives them advantages over other owners of other businesses (including limited liability and tax advantages), that by availing themselves of that statutory structure the owners take the bad with the good, that the corporation code did not define a corporation as a “person” for purposes of state or federal constitutional law, and that the remedy is for an amendment to state law or state constitution.
Most critically, the state argues that defining “personhood” for purposes of triggering constitutional protections is a question of state law, because there is no Constitutional guidance on how the Sup Ct. should interpret “person” to be anything other than the normal defintion — i.e., a living human being. If a federal constitutional definition of “person” is needed, the only appropriate way to do it is by amending the Constitution.
persuasive? dunno. It’s at least reasonable.
“Another example would be time, place and manner restrictions on free speech, which are proper, that are instead being used to circumvent the basic right to free speech. A classic recent example is “free speech zones.” Someone has to decide whether or not the restrictions are in fact proper time, place and manner restrictions, or are a subterfuge for denying basic speech rights. The legislative body has the power to enact time, place a manner restrictions, but cannot use that power to define “free speech zones” in such a manner so as to eliminate effective use of the right. Courts have forever been punching holes in such rhetorical game playing with definitions.”
But that is because the people in question have actual CONSTITUTIONAL rights. The legislature tries to subvert the CONSTITUTIONAL right held by the people, and the courts don’t let them because the Constitution says those people have right that the legislature can’t mess with.
Your claim is that corporations do not have such CONSTITUTIONAL rights. See hilzoy, see lizardbreath, see anarch. The claim is that the rights are or ought to be legislative rights. If that is true, where does the CONSTITUTIONAL claim for property come in? You just define the stuff that corporations hold as non-property (in the Constitutional sense) and property in other respects. There is no reason not to be able to do that (in your proposed system) because you are claiming that corporations do not have ‘rights’ accorded to persons given to them by the Constitution, but merely by whatever the legislature says.
KCinDC
if the right for corporations you’re talking about is one that’s simply created by legislation, then it’s not a constitutional right
Under any scenario, corps have constitutional rights only because of the laws that craft them — there are no inherent rights for artifical entities.
So how are corporations people with constitutional rights if they are simply creatures of statute? Your query seems to assume that constitutional rights cannot derive from something created by legislation — but that is always the case for corporations. So what is the source of constitutional rights for corporations? — it is always based on the extent of the powers with which they are endowed in the first instance by the laws that create them.
Clearly the legislature has the power to create corporations with more limited powers — that in fact was the historical origin of corporations. They were disfavored entities created with sharply limited powers. The industrial revolution modernized the concept because they are such useful tools for aggregating capital.
If you read the history of cases on this topic (which I have done only briefly in commenting on this post), it is interesting that the Supreme Court does not explicitly base its analysis on the theoretical question of whether or not a corporation is a person. (a few examples — US V. Morton Salt — 4th amendment, See v. Seattle, similar (pdf)) Its been a case by case analysis based on what makes sense in particular circumstances. The modern corporation with broad powers and rights ends up with a lot of constitutional rights because it makes sense to do so in a lot of different context. But that result seems dependent on the nature of the entity created by statute.
My query is why, if you create rights for corporations through legislation, those rights must suddenly be constitutional rights, which seems to be what you’re claiming. Why couldn’t legislation create more limited rights to something like speech or something like property that were not the same as the constitutional rights that persons have?
If it’s possible for the corporations’ rights to be nonexistent or the same as humans’, why isn’t it possible for them to be somewhere in between?
“Your query seems to assume that constitutional rights cannot derive from something created by legislation — but that is always the case for corporations.”
I echo KCinDC. We both believe that constitutional rights CAN derive from something created by legislation. But we don’t understand why rights created by legislation MUST be constitutional rights.
We both believe that constitutional rights CAN derive from something created by legislation. But we don’t understand why rights created by legislation MUST be constitutional rights.
More or less thirded.
If it’s possible for the corporations’ rights to be nonexistent or the same as humans’, why isn’t it possible for them to be somewhere in between?
…
But we don’t understand why rights created by legislation MUST be constitutional rights.
Sorry for being dense earlier, but I now get the distinction you are driving at.
To respond to the first point, since this is just theory, I assume it could be so. And to respond to the second point in the same spirit, I assume that theory would permit the creation of a class of lesser non-constitutional rights. For example, the legislature could create a special class of limited liability entities that were expressly defined as having only some watered-down rights, but less than those provided by the constitution. And anyone who opts to utilize that entity could be deemed to have consented to this crappier level of rights. A similar logical construct exists in other areas of law (example — implied consent laws for testing for drunk driving if you accept a drivers license; its a crime to refuse to submit to the tests, when normally you would have a constitutional right to refuse to do so).
In practice, I think the legal approach has been to either recognize that a corporation has the same rights as for natural people, or it does not. I think the court’s have trouble with parsing the rights, or creating half-rights. So it MUST be constitutional rights because existing law does not provide for any in between status. Realize that corporate law itself provides essentially no guidance on these questions. You would look in vain through corporate law for provisions indicating what the intent was as to which rights these entities should have.
I think, from scanning a lot of decisions the other day, that there is a practical approach underlying the decisions in this area. Since so much behavior in question could be undertaken by either a corporation or a non-corporate business form, does it really make sense to analyze the question from the point of view of does the right exist for a corporation? For example, for a search and seizure question, why distinguish between two identical businesses operating next door to each other, but one is a corporation and one is not?
Put another way, the logic for whether or not to acknowledge that a right exists in a certain situation rarely seems to depend on the status of the entity in question.
And modern corporate law creates entities with broad powers that look a lot like quasi-people. In deciding what rights they have, the courts are dealing with that pre-existing framework as to the nature of corporations.