A prominent feature of my position, and the position of many of my fellow leftists, on Citizens United is the notion that corporations are not people who are the appropriate object of First Amendment rights. I think it’s worthwhile to try and lay out the basics of this argument here in a hopefully-brief post. (Written a little bit hastily, apologies for any typos/incoherencies.)
The fundamental idea is simple. Corporations are not persons. Corporations are fictional entities created by the state for a specific purpose (to permit certain economic efficiencies), and it makes as much sense to say that they have constitutional rights as it does to say that a dog or a car or the categorical imperative or an estate in land or a trust or a local government has constitutional rights. The management and shareholders of a corporation have constitutional rights, but there’s no reason to think those rights extend to the willy-nilly use of corporate resources, any more than do the constitutional rights of the management and citizens/beneficiaries of a trust or local government.
The details require some fleshing out, obviously.
1. The important differences between a corporation and an aggregate of people..
One immediate objection to the fundamental idea stated above is that a corporation is nothing more than a bunch of people (shareholders) pooling their resources, and if it’s constitutionally protected to get together and aggregate resources to influence the government (which it obviously is), this should protect corporations too.
This objection is completely wrongheaded. Corporations are state-chartered entities given special privileges (limited liability, in particular), for a particular purpose (to promote the economic benefits from efficiencies of scale). Corporations are, at their most basic level, profit-generating machines. By insulating investors from many of the risks of their economic activity, they permit a much faster and larger aggregation of wealth than would be the case if the people involved just got together and formed, say, a massive partnership. And the price for this is some loss of control — the owners of a corporation aren’t allowed, without going through special procedures, to just take money out of the treasury, management and directors have all kinds of funny fiduciary duties, there are numerous rules about how stock is issued, sold, priced, etc. Management and owners who treat corporate resources as their own personal resources (it goes by names like “commingling of funds”) can even lose the limited liability benefit for which the corporation was created.
What this means on a policy level is that if the people who make up a corporation (i.e., shareholders and employees) got together without the benefit of a corporation and decided to try to influence politics, they’d have far fewer resources with which to do so. Corporations, as concentrations of money, distort the political system.
What this means on a constitutional level is that (a) there’s a coherent, meaningful, and legally familiar difference between “my resources” and “the resources of the corporation in which I happen to own a share,” such that it requires an argument (thus far not offered) to go from “I have the right to spend my own money to influence politics” to “I have the right to spend the money of the corporation in which I hold shares/a management position to influence politics.” It also means (b) that we ought to pay due regard to the fact that the state is often permitted to impose conditions on benefits (like a corporate charter) that it gives that it isn’t permitted to impose as regulations on the populace at large. For example, when the state gives you a license to drive, it’s permitted to require you to submit to a breath test, even though if it gave you breath tests while walking down the street it would be a fourth amendment violation. (Or consider a hypothetical. Suppose the state gives you a car in order to achieve some public policy goal, say because it hired you to deliver welfare checks. And you use that car to go canvassing for political candidates. I think we’d agree that the state’s forbidding this behavior wouldn’t constitute a First Amendment violation.)
Just for some historical perspective, at the beginning of the United States, restrictions on corporations were much more severe. Corporations were chartered for a specific purpose, and if they exceeded that purpose they were deemed to be acting ultra vires and subject to a revocation of their charter by a writ of quo warranto. For examples of this, see footnote 30 in “Quo Warranto and Private Corporations” Yale Law Journal 37:2 (1927) pg. 242 (which seems to be unsigned?). And this should matter for originalist (like, ahem, Scalia), since it seems highly unlikely that the founders would have expected corporations to have broad-based constitutional rights to use their money like an ordinary person can, in light of the legal context in which they existed at the founding.
(Incidentally, a vestige of these old restrictions can be seen in local government law. Local governments were among the original models for the corporate form — hence, for example, the government of London is still called the City of London Corporation — and in many U.S. states, local governments have no powers, except those explicitly granted by the state, a restriction that is often enforced quite vigorously by the courts, who happily rule trivial local government actions ultra vires on a daily basis.)
2. But what about other constitutional rights?
On Facebook, the always insightful Jacob Levy offered the following challenge to this position:
I ask others who think “corporations =/=persons–> they lack constitutional rights”: may corporate-owned property be taken without compensation? Can it be searched without a warrant? Must a lawsuit against a corporation be governed by due process rules? Could corporate charters be conditioned on the corporations donating to Protestant churches?
And I’d answer: corporations don’t have constitutional rights against those things either. However, the shareholders of corporations have constitutional rights against some of those things being done to the corporations in which they own shares, and others of those things are barred by general constitutional provisions that don’t require a specific person whose rights were violated.
The general idea here is that the state permits the corporate form to be created for certain economic reasons, and in pursuit of that, gives people certain guarantees, such that their investments in corporations won’t be stolen. I think it would probably violate the property and due process rights of shareholders to seize corporate-owned property without compensation, just like certain kinds of “regulatory takings” (which ought to be a pretty narrow category, but perhaps not nonexistent). Like a “regulatory taking,” the state doesn’t directly seize what the constitutionally cognizable (human) victim owns (i.e., the stock), but it both a) violates the reasonable expectations of the property (stock) owner, and b) basically renders the property (stock) worthless. I think this argument is quite good enough to establish that the state may not take corporate property without compensation or permit lawsuits against corporations to go forward without the guarantees of due process, but without giving corporations constitutional rights that they don’t have.
(Andrew March aptly pointed out on Facebook that corporations don’t have the right to vote. The general principle — that corporations, being artificial entities created for an economic purpose, ought to [indirectly] get economic rights but not political ones — seems totally sound to me.)
The protestant churches example is a different case. The establishment clause forbids the state from subsidizing particular religions regardless of if there’s any particular person who can say her constitutional rights have been violated. So a corporation need not have constitutional rights in order for it to be impermissible for the state to make it give a bunch of money to the protestants.
And finally, I will happily bite the bullet on the search warrant case. There doesn’t seem to be any real constitutional reason to protect the “privacy” of fictional entities. Indeed, we don’t do so in many cases — publicly traded corporations are required to make huge amounts of financial information public that would probably be a fourth amendment violation if imposed on human beings, for example. And individual humans have reasonable expectations of privacy in their spaces on corporate property — saying corporations have no privacy rights doesn’t mean the state is entitled to search the desks of managers or the safe deposit boxes of bank depositors, so denying that corporations have fourth amendment rights on their own behalf won’t usher in a world of total surveillance. (We actually need much stronger fourth amendment protections for individuals.)
For example, the Supreme Court in NAACP v. Alabama aptly held that the constitution prohibited Alabama from by demanding a copy of the organization’s membership list. But not because the corporate entity of the NAACP had any rights. Rather, because it would chill the individual free speech and association rights of NAACP members to require the disclosure. As the Court said:
There is no occasion in this case for us to consider how much survives of the principle that a State can impose such conditions as it chooses on the right of a foreign corporation to do business within the State, or can exclude it from the State altogether. E. g., Crescent Cotton Oil Co. v. Mississippi, 257 U.S. 129, 137 . This case, in truth, involves not the privilege of a corporation to do business in a State, but rather the freedom of individuals to associate for the collective advocacy of ideas. “Freedoms such as . . . [this] are protected not only against heavy-handed frontal attack, but also from being stifled by more subtle governmental interference.” Bates v. City of Little Rock, 361 U.S. 516, 523 .
(emphasis mine) This seems like exactly the right approach.