Corporate Personhood

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."

Comments

[cleek]

can a corporation own guns and kill people in self defense ?

can a corporation vote ?

can a corporation practice a religion ?

[hilzoy]

cleek: most important of all, can troops be quartered in a corporation's home during peacetime?

[Sebastian Holsclaw]

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.

[cleek]

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 !

[Sebastian Holsclaw]

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?

[hilzoy]

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.

[KCinDC]

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.

[KCinDC]

Cleek, corporations can't be allowed to marry until we can definitively determine their sexes.

[Fledermaus]

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.

[LizardBreath]

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.

[Slartibartfast]

"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.

[KCinDC]

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.

[Slartibartfast]

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.

[LizardBreath]

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.

[rilkefan]

"The limited liability form"

Could someone cast a brief light on my ignorance, esp. on what a "form" is in this context?

[Sebastian Holsclaw]

"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.

[LizardBreath]

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.

[Fledermaus]

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.

[Slartibartfast]

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?

[kid bitzer]

"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.

[LizardBreath]

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.

[Sebastian Holsclaw]

"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.

[Slartibartfast]

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.

[Slartibartfast]

Rephrase: the possibility that my intrinsic annoying-ness is the source of the problem, and not any deliberate attempt to annoy.

[Bernard Yomtov]

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.

[Nell]

Sebastian, the topic under discussion is for-profit business corporations. They are organizationally and legally distinct from nonprofit advocacy organizations.

[Bernard Yomtov]

"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?

[Anarch]

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.

[Slartibartfast]

So, some kinds of collective speech are good, while other kinds are bad?

[Anarch]

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 Holsclaw]

"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?

[Jay S]

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.

[LizardBreath]

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.

[hilzoy]

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.

[hilzoy]

(cross-posted with LB making the same point, which gives me a certain amount of confidence, since IANAL and SI.

[LizardBreath]

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.

[Sebastian Holsclaw]

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?

[Sebastian Holsclaw]

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.

[LizardBreath]

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.

[Jay S]

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.

[Jay S]

Correction 501-3c->501(c)(3)

[Katherine]

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.

[Phil]

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.

[Sebastian Holsclaw]

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.

[Sebastian Holsclaw]

"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?

[Sebastian Holsclaw]

"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.

[LizardBreath]

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?

[LizardBreath]

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.

[CharleyCarp]

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.

[Sebastian Holsclaw]

"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?

[LizardBreath]

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.

[Fledermaus]

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.

[LizardBreath]

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.

[Sebastian Holsclaw]

"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.

[Sebastian Holsclaw]

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.

[Bernard Yomtov]

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.

[LizardBreath]

Honestly, not new to me.

Then what was the point of all of those questions? Surely you knew the answers.

[Fledermaus]

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.

[Sebastian Holsclaw]

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.

[Sebastian Holsclaw]

"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]

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.

[LizardBreath]

No, silly, what was the point of the actual questions you asked and I answered about things like bank accounts.

[hilzoy]

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?

[LizardBreath]

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.

[Fledermaus]

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.

[Bernard Yomtov]

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.

[John R. Christiansen]

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?

[russell]

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 -

[kid bitzer]

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.

[Sebastian Holsclaw]

"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:

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.

'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.

[Sebastian Holsclaw]

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.

[russell]

'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?

[Sebastian Holsclaw]

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.

[CharleyCarp]

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. :)

[Francis]

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.

[CharleyCarp]

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.

[Bruce Baugh]

That was me. Not sure where my name went.

[Bernard Yomtov]

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.

[Jay S]

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?

[Jay S]

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.

[Slartibartfast]

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.

[Francis]

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.

[Jay S]

Francis, I don't get this:

Just because we as a society refuse to give corporations the power to lobby...

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.

[Steve]

I assume he meant "can refuse to give," considering his sentence immediately prior to the one you quoted.

[dmbeaster]

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.

[Phil]

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.

[LizardBreath]

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.

[Bernard Yomtov]

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.

[Slartibartfast]

Drat.

[Sebastian Holsclaw]

"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.

[dmbeaster]

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.

[trilobite]

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.

[trilobite]

Whoops, please delete "while" from my last comment.

[Sebastian Holsclaw]

"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.)

[Lex]

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.

[Slartibartfast]

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?