'We the People' versus 'We the Corporation': Sentiment Builds for Banning Corporate Personhood, But Tough Road Ahead.
Across the country, momentum has been building for an amendment to the U.S. Constitution declaring that the democratic rights and freedoms granted to people do not apply to corporations and corporate entities.
In November alone, local voters in Colorado, Montana, Maine, Wisconsin and California passed various resolutions to ban corporate personhood. Seven bills have been introduced in the current Congress, including four this month—including amendment proposals. Public interest groups have been gathering petition signatures, all with an eye to the two-year anniversary of a Supreme Court ruling, known as Citizens United, which granted significant new political powers to corporations by ending a century-old prohibition on directly spending money from their corporate treasuries for political campaigns.
A constitutional amendment proposed by Congress must pass House and Senate chambers with two-thirds majorities and then be ratified by three-fourths of the states. The last amendment, passed in 1992, concerned congressional pay and was proposed in 1789. The 26th Amendment, which lowered the voting age to 18, passed in 1971, after tens of thousands of youths that age died in Vietnam but could not vote. Though the political equivalent of climbing Mt. Everest, supporters of an amendment to reverse or reign in corporate constitutional rights are not deterred.
“We are facing a crisis in American democracy today,” said John Bonifaz, co-founder and director of Free Speech for People, who has been involved with various proposals in Congress. “The question is whether it is ‘We the people’ or ‘We the corporations.’ The response to that crisis has to be a bold vision that will restore democracy to the people. Constitutional amendment fights are the very kind of fights that return us to the basic principles of what we are as a nation.”
The effort to restrain the power of corporations by targeting American democracy's foundational document—the Constitution—is not without critics or controversy, even in progressive circles. There are varying proposed amendments, based on smaller and larger reform visions. There are fears that undoing corporate powers entrenched in federal and state law would harm non-profits and labor unions, and cause other unintended effects. However, what is undeniable is there is broad support—not just in Occupy Wall Street protests but among middle-class Americans as evidenced by mainstream media polls—for tangible steps to restoring the balance of power between big business and individual citizens.
“If we were able to get the big money out of politics, what more would you really want to do?” non-profit lawyer Greg Colvin asked.
Which Problem? Which Solution?
There are two threads among the various amendment proposals. The narrower approach, which Colvin embraces, seeks to address two U.S. Supreme Court rulings, 35 years apart. One allowed for unlimited campaign spending and the other granted excessive power to corporate money in elections.
The first of those rulings, Buckley v. Valeo, said spending money in campaigns is speech protected by the First Amendment. Though Buckley said donations to candidates could be regulated, it struck down limits on campaign spending by candidates and by independent groups – limits passed by Congress in the wake of the Watergate scandal.
The second ruling, Citizens United, voided a 2002 reform that was Congress’ most recent effort to address the problems of our campaign finance system, but went much further to grant constitutional rights to corporations. It said that not only can corporations spend unlimited sums in elections, but restricting such spending would create “a disadvantaged person or class.”
In essence, the Supreme Court in Citizens United, said that corporations have explicit First Amendment protections—the same rights and liberties as citizens. And those speech rights do not just apply to political campaigns. There is ongoing litigation in many federal and state courts where corporations are fighting government regulation by saying they are unconstitutionally being forced to speak by putting warnings on their products.
So there are two schools of thought on how broad or narrow a constitutional amendment proposal should be. Some of the earliest ones simply seek to overturn Buckley by saying Congress and the states have the power to regulate the way money is raised and spent in political campaigns. “If people had the upper-hand in our electoral system, would we still think it necessary to abolish all other corporate constitutional rights. Maybe, maybe not,” said Colvin, who suggested language saying that only citizens can donate to campaigns, that states and Congress could regulate the donations and expenditures, and also institute public financing.
But Bonifaz and advocates such as Rep. Jim McGovern, D-MA, who last week introduced amendment legislation to overturn corporate personhood, believe that solely addressing the problem posed by Buckley – of unlimited campaign spending, including, now, unlimited campaign spending by corporations – is not sufficient.
“I am on the same page as those who say we must overturn Buckley and have limits on campaign spending. I have led the fight in the courts for that for years,” Bonifaz said. “We must also have a response to the Citizens United ruling. It cannot solely be within the campaign finance frame. The Citizens United ruling is the most extreme extension of a corporate rights doctrine that has been eroding our democracy and our Constitution for 30 years.”
Intended and Unintended Consequences
The word “corporation” does not appear in the U.S. Constitution. Where corporations enter the law—as has been the case for all of American history—begins at the state level, where businesses are registered, chartered, regulated, taxed, and all manner of activities that constitute doing business in America. The Constitution’s framers were very clear that economic interests did not have the same rights as citizens. After all, the Revolutionary War was fought against unfair and excessive economic exploitation by Great Britain.
As the decades of American history and law unfolded, the use of the terms "corporation" and "persons" and other business entities became blurred and interchangeable, especially when states or Congress adopted new laws. But the Constitution was not amended in a manner granting corporations new rights and freedoms that belonged to people—such as the right to vote, to bear arms and so forth. Instead, corporate litigators going back to the Industrial Revolution began making arguments before the Supreme Court to try to prompt the court to extend to big businesses—such as railroads—the same protections that people were afforded under the Bill of Rights and other amendments.
There has been an ebb and flow of those rights and powers for more than a century. But in the past 30 years, culminating in Citizens United, the balance of power between individuals and corporations has swung away from average citizens to the richest and most powerful institutions. That is because they have found new ways to spend money in campaigns and have been awarded new speech rights in federal court.
What lawyers like Colvin fear about an amendment that seeks to overturn corporate personhood are the unintended consequences. On one hand, he said it would do too little—not stopping wealthy individuals from spending their own money. And it would do too much, he said, saying it could take away the ability for non-profits and unions to participate in politics under the current rules. For example, should the Sierra Club and ACLU have the right to privacy of membership lists? Should Planned Parenthood have the right to a lawyer in court; or protection against self-incrimination or double jeopardy?
"You want to minimize unintended consequences," Colvin said. "Sometimes it is better to figure out how things would be different if you make one change and see what that brings. If you get the big money out of elections, the corporate and wealthy donors would have less impact."
Colvin supports the recent amendment proposal by Rep. Ted Deutch, D-FL, that restricts constitutional rights of for-profit corporations but carves out an exception for non-profits.
But Bonifaz, in contrast, believes that all corporations, whether for-profit or non-profit, should not be awarded the same rights as people under the Constitution.
“Remember, Citizens United was a non-profit,” he said, referring to the advocacy organization that wanted to distribute an anti-Hillary Clinton video before 2008 primaries with financial support of corporate backers. That was not allowed under the federal McCain-Feingold campaign finance law and was challenged, ending up in the Supreme Court.
Bonifaz said it would be risky to carve out exception for some corporations, even non-profits, because that could open up loopholes that would be abused by interests with the means and motives to do so. He countered that non-profits and some unions (not all are organized as corporations) would not be threatened under the broader proposal he and Congressman McGovern supports.
“Individual members of non-profits maintain all of the rights guaranteed to people under the Constitution. They do not need the artificial form of a corporation – for-profit or non-profit – to assert their individual constitutional rights,” he said. “The fundamental question here is whether we elevate corporations to have the same rights of people under the Constitution or whether we restore democracy and our Constitution to the people.”
The Debate Continues
While progressives will continue to debate what constitutional rights corporations should have, it is important to remember what supporters of corporate constitutional rights have said.
Chief Justice John Roberts, during arguments in the Citizens United case before the high court ruled, said, “A large corporation, just like an individual, has many diverse interests.” In the same hearings, Justice Antonin Scalia said corporations are “indistinguishable from the individual that owns them.” And pro-corporate activists, such as Center for Conservative Politics founder and chairman Bradley Smith, said corporations are bodies made up of individual people with “attendant free-speech rights.”
But even the current Supreme Court has issued rulings underscoring that corporations do not have the same constitutional rights as people. In January 2011, it ruled that they do not have the right of personal privacy to evade the federal Freedom of Information Act requests — which AT&T had argued was an invasion of personal privacy.
In other words, beyond the rhetoric that all speech should be embraced in a democracy – even if it is by business entities that are licensed by states, that do not vote, that do not have rights to bear arms, and have no privacy rights under FOIA – this debate will continue.
“We need a constitutional amendment debate,” Bonifaz said. “I think it’s quite vibrant that there are various versions.”