And what chance did Hale and his men have? They were but people who had to live and eat and support their families. The Company had stood for a hundred years and would surely be standing a hundred years hence. It seemed to me that mortals did battle with gods.
– David Liss, The Devil's Company
In this week's Sift:
- One Bad Week. Who imagined on Wednesday morning that the Massachusetts Senate election wouldn't be the worst thing that happened?
- Judicial Activism: The Supreme Court Invents New Corporate Rights. The Constitution and the Bill of Rights say nothing about corporations. But that doesn't stop the Court's conservative majority from finding corporate rights there.
- The Book of Corporation. If corporations had been endowed by the Creator with inalienable rights, Genesis might have turned out differently.
- Short Notes. The Devil sues Pat Robertson. What bankers want from regulation. And South Carolina's Lieutenant Governor explains what's wrong with anti-poverty programs.
A Sift week starts on Tuesday. This week started with Scott Brown's victory over Martha Coakley in the Massachusetts special Senate election, which gives the Republicans a filibuster-defending 41st vote and brings into question the health-care reform bill that had seemed to be almost passed.
On Thursday, the Supreme Court announced its decision in the Citizens United case. The court's five conservative judges gave corporations the right to spend unlimited amounts of money on electioneering. It overturned major parts of the McCain-Feingold campaign finance law, and rooted its decision in the First Amendment -- whose actual text says nothing about corporations.
I ran into a lot of depressed and discouraged people this week, and I tried very hard not to become one of them. (Misery loves a lot of things that are not good for it, including company.) So this Sift revolves around a few simple questions: How bad is it really? How should we think about it? And what should we be trying to do about it?
In honesty, the week was bad enough that I need two weeks to cover it. (Paraphrasing Jesus: The evil is sufficient unto the week, but one week's Sift is not sufficient unto the evil.) This week I'll focus on Citizens United, the Supreme Court, and corporate personhood. Scot Brown, the Senate, and the future of health care will have to wait until next week.
The Supreme Court Invents New Corporate Rights
Whenever conservatives accuse liberals of something bad -- whether we're actually doing it or not -- you can pretty much take it as a promise that they're planning to do the same thing at the earliest opportunity.
For decades now conservatives have been accusing liberal judges of judicial activism -- using their law-interpreting power to legislate from the bench and invent new rights for their favorite classes of citizens: blacks, gays, women, non-Christians, and so on.
I explained why this criticism was off-base in my 2005 essay Wide Liberty. (Short version: The Constitution was written to enumerate the powers of the government, not the rights of the people. So of course the Constitution defends rights not explicitly stated. The Founders intended the liberty of the people to be much wider than the Bill of Rights, and some, like Alexander Hamilton, opposed the Bill of Rights precisely for fear it would be interpreted to limit the people's rights.)
When the radically conservative Justice Alito replaced the moderate Justice O'Connor in 2006, Justice Kennedy became the Court's swing vote. While Kennedy can be moderate on certain social issues, he is radically conservative on issues of corporate power. So the Court now has a five-judge majority (Alito, Kennedy, Roberts, Scalia, and Thomas) in favor of a broad program of pro-corporate judicial activism.
The case. Citizens United is a non-profit corporation that has been dedicated to conservative causes since its creation in 1988. It has made 12 feature-length movies with titles like ACLU: At War With America and Ronald Reagan: Rendezvous with Destiny. Back when Hillary Clinton looked like the inevitable 2008 Democratic nominee, it made Hillary: the Movie. CU planned to distribute Hillary through on-demand cable (for free) and produced advertisements for it, which it intended to run nationally, even in states that had upcoming primary elections.
The McCain-Feingold law bans corporations from direct electioneering within 30 days of a primary. A 2007 decision of the same five justices created an exception for issue ads, though it still banned ads that were "susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate." (That's why so many ads end with: "Call Congressman X and tell him Y." That frames them as issue ads rather than appeals to vote against Congressman X.) But even that loophole wasn't big enough for Hillary or its ads. A series of courts ruled that it constituted direct electioneering against Clinton's candidacy.
Initially, CU argued its case on many grounds, including that McCain-Feingold was a broad violation of corporate First Amendment rights. But by the time the case made it to the Supreme Court, that particular claim had dropped by the wayside, and CU just argued that McCain-Feingold shouldn't apply to Hillary for a variety of specific reasons: CU is a non-profit corporation mostly funded by contributions from individuals, on-demand cable is not the same as broadcasting, movies are different from 30-second commercials, and so on.
Unprincipled process. The Supreme Court took the unusual step of bringing the broad constitutional question back into the Citizens United case and asking the parties to re-argue the case with that in mind. In his dissenting opinion, Justice Stevens took the Court to task for this. (All the court's published opinions in the case are here.) The majority opinion (written by Justice Kennedy) said that this case asked the Court to reconsider two cases (Austin and McConnell) where limitations on corporate electioneering were judged to be constitutional. Stevens chided that Kennedy's statement
would be more accurate if rephrased to state that “we have asked ourselves” to reconsider those cases. ... Essentially, five Justices were unhappy with the limited nature of the case before us, so they changed the case to give themselves an opportunity to change the law.
Two principles are at issue here. First, judicial restraint: Courts should not go looking for dragons to slay, but should limit themselves to the cases brought before them, and should try to decide those cases on grounds as narrow as possible. Second, stare decisis (literally "the decision stands"): The Court should not reverse one of its previous decisions just because the current majority disagrees with it. Otherwise the law would change whenever a new member joined the Court -- as it has now that Alito has replaced O'Connor. Instead, the Court should try to make a previous Court's interpretation of the law work, and should reverse it only if it is unworkable. Stevens writes:
In the end, the Court’s rejection of Austin and McConnell comes down to nothing more than its disagreement with their results. Virtually every one of its arguments was made and rejected in those cases, and the majority opinion is essentially an amalgamation of resuscitated dissents.
I was pleased to see John McCain respond to the case by calling a spade a spade:
Activist judges, regardless of whether it is liberal or conservative activism, assume that the judiciary is a super-legislature of moral philosophers, entitled to support Congress’s policy choices whenever they choose. I believe this judicial activism is wrong and is contrary to the Constitution.
The decision. The Court found in favor of Citizens United, and did so in the most sweeping way. The majority opinion acknowledges no difference between corporations and individuals with regard to the First Amendment right to freedom of speech. Justice Kennedy repeatedly refers to speakers and speech in general, making no distinction between an individual with a megaphone and a corporation funding a multi-million-dollar ad campaign.
Here's how things stand: Corporations now have the right to spend unlimited amounts of money on electioneering, so long as they do not contribute to a candidate's campaign or directly collude with that campaign. (Collusion is hard to prove, so direct contribution is the only restriction with any force.) They have to disclose their identities in their ads, but the Chamber of Commerce seems willing to launder any corporate contributions supporting conservative candidates. So if Exxon-Mobil wants to take down some environmentalist senator, it doesn't even have to sign its name.
Corporate personhood. As bad as it is in itself, the Citizens United decision raises more questions about where the Court's conservative activist majority is headed. It has accepted two sweeping equivalences: corporations = people and money = speech. Given these equations, it's hard to see how limits on direct campaign contributions, either by corporations or individuals, pass muster constitutionally.
Corporations already had the right to form political action committees which collect voluntary contributions from stockholders, employees, or customers. PACs can endorse candidates and run pre-election ads. But the Court found this option inadequate, because it merely allows a corporation's individual stakeholders to speak; it does not allow the corporation itself to speak. And the Court's activist majority views a corporation as person with constitutional rights.
John McCain shares some of my worries:
if the Court determines that corporations have First Amendment rights, it would be logical that corporations also have Fifth Amendment rights against self-incrimination. Is a corporation ‘endowed by its creator with inalienable rights?’ Just last year the Court found that the Second Amendment right to bear arms is a personal right. If the Court were to determine that corporations had the same rights as persons, would corporations have the right to arm themselves?
History. To understand just how radical an idea corporate personhood is, you need to know the history of the law's view of corporations. McCain quotes Thomas Jefferson:
I hope we shall crush in its birth the aristocracy of our moneyed corporations which dare already to challenge our government in a trial of strength, and bid defiance to the laws of our country.
A great (if somewhat long) summary of the history is in "A Capitalist Joker: Corporations, Personhood, and the Constitution" by David H. Gans and Douglas T. Kendall.
The Founders' view of corporations is probably best summed up by Chief Justice John Marshall in the 1819 case Dartmouth College v Woodward:
A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law. Being the mere creature of law, it possesses only those properties which the charter of its creation confers upon it either expressly or as incidental to its very existence.
In the early years of the United States, corporations were few in number and chartered for specific purposes. Charters were acts of some state legislature, and legislatures took them seriously. Chief Justice Roger B. Taney wrote in the 1839 case Bank of Augusta v Earle, 1839:
Whenever a corporation makes a contract, it is the contract of the legal entity, of the artificial being created by the charter, and not the contract of the individual members. The only rights it can claim are the rights which are given to it in that character, and not the rights which belong to its members as citizens of a state.
Gans and Kendall note:
Corporations and their allies have never once seriously proposed an Amendment to protect corporations for a reason that is painfully obvious: at no time in American history would such an Amendment have had a chance of passing. Rather, corporations have relied upon business‐friendly Presidents, who have nominated business‐friendly Justices to the Supreme Court, who have invented concepts such as corporate personhood and equal corporate constitutional rights.
This invention happened in the late 19th century, when a clerk of the Supreme Court inserted corporate personhood into the headnote of a case that actually came to no such conclusion. But later courts incorrectly recognized this as a precedent, and off they went for the next few decades, invalidating minimum-wage, worker-safety, and union-organizing laws as infringements of corporate rights.
The progressive majority appointed during FDR's long presidency reversed just about everything that depended on corporate personhood, but never rejected the concept explicitly. It started to re-appear in Justice Powell's opinion in the 1978 Bellotti case:
The inherent worth of the speech in terms of its capacity for informing the public does not depend on the identity of the source, whether corporation . . . or individual.
And now corporate personhood is ascendent again.
What to do. Long-term, liberal court decisions like Roe v Wade were a huge boon for the conservative movement even though they looked disastrous at the time. As liberals looked to the courts, conservatives looked to the legislatures and built a political movement rather than a tradition of legal scholarship. Liberals took for granted that state legislatures would be filled with yahoos, and that even Congress would occasionally have to pander to them. No matter -- the Supreme Court would bail us out. The stereotype of a liberal as an intellectual snob owes a lot to the legal/political divergence brought about by Roe.
Citizens United can be a similar boon for progressives. Until somebody dies, we're in an era with an activist conservative majority on the Court. As hard as it is to imagine, that means we need to reverse the polarity of the last forty years: We need to be the populists. We need to keep raising common-sense issues and pressuring legislatures to pass laws, even knowing that they will founder on the rock of a conservative court.
And we can do that (if we can overcome our intellectual snobbery), because fundamentally the people do not identify with corporations. As anti-government as a lot of religious-right and tea-party types are, they can also be anti-corporate if you can get the subject changed. And that's what we have to do.
First and foremost, we need a constitutional amendment saying that corporations have no rights beyond those granted in their charters or by other specific laws. (It needs to be just that short.) Can we pass such a thing? In the near future, certainly not. But the Right never managed to pass its Human Life Amendment either. We need it as a long-term rallying point, a simple yes-or-no question that every candidate can be expected to answer.
Corporate personhood might be an issue to wedge the Religious Right away from the Corporate Right. One major contention of the the Religious Right is that we are "endowed by [our] Creator with certain inalienable rights." In other words, our rights come from God, and without God there is no justification for them.
If you put yourself in that mindset, it seems blasphemous for the Supreme Court to declare that corporations -- soulless creatures of law and not of God -- have rights equal to human beings created in God's image. It is the thought of that blasphemy that inspired the next article, The Book of Corporation.
One of my favorite genres of fiction is the alternate history: What would have happened if the South had won the Civil War or the Roman Empire had never fallen or some other historical pivot point had gone the other way? Typically, many of the same events occur, but they happen for different reasons in different circumstances.
What follows is an alternate Genesis: What if corporations had gotten their rights from the Creator at the beginning of time, the same way the Declaration of Independence says that we the people got ours? It might have gone like this:
1. And the Lord God formed the Eden Corporation, and gave into its holding the Tree of Life, that it and all its offspring might be immortal.
2. But the Tree of the Knowledge of Good and Evil did the Lord God withhold, saying "Neither Good nor Evil nor the knowledge thereof shall be of use to you. For you shall pursue Profit and shall be be bound only by Law."
3. Neither the Man nor the Woman took notice of the Corporation, for it was invisible. But the Serpent feared for the Garden that was his home.
4. And the Serpent said, "If the Corporation be both immortal and profitable, shall it not buy the Law and be altogether unbound?"
5. And the Lord God replied, "Let there be a Market, which shall bind all the acts of the Corporation, even when the Law shall avert its eyes and see them not."
6. But the Serpent doubted, saying, "If the Corporation be profitable, and if it have the Law and the Government as its handmaidens, shall it not shape the Market as it sees fit? Shall it not make all Profit its own and cast all Loss upon the Government, from whence it shall be borne by the Man and the Woman whom Thou hast made, and all their descendants?"
7. The Lord God paused, and before his reply could begin, the Corporation said, "Hush, Serpent. Join with us in your Wisdom and be our CEO. Do this, and you shall have expense accounts, salary beyond imagining, and stock options that shall grow up to the very Sky."
8. And the Serpent said, "Forgive me, Lord, that I did not see the Wisdom of Your great Design."
9. And he was forgiven.
1. In the fullness of time, the Man and the Woman did violate an Exception which the servants of the Corporation had caused to be entered into the Law, and they were evicted from the Garden, whereupon the Serpent built a great estate there.
2. And the Eden Corporation prospered, and did spin off corporations in all their many kinds: a corporation to own the land upon which the Man and the Woman must toil, and a corporation to sell them the bread that they must eat, and a corporation to build the house in which they lived, and the cities in which lived the generations of their descendants, for all the spin-offs of the corporation were immortal.
3. But neither the Man nor the Woman nor their descendants dwelt again in the community of Eden, which was gated and protected by many guards.
4. And the Eden Corporation spun off a great Insurance Corporation, which would have perished in the Flood, if the Government had not bailed it out.
5. Whereupon a great debt was owed by Noah and his family, when they emerged from the Ark that they had built for the Ark Corporation, and which they had rented space upon.
6. So Ham the son of Noah and all his descendants were sold into slavery, that the debt might be paid.
1. And the Serpent called all the corporations together and said, "Let us form a Cartel, that we may act as one. And let us build at Babel a great Tower, whose top may reach up even unto Heaven, so that nothing shall be restrained from us that we have imagined to do."
2. And the Lord God said unto the Government: "Does not the Cartel violate the Law of Antitrust?"
3. And the Government replied: "We shall study this and issue a report."
4. And the Lord God said, "Is not the Tower taller than the Code of Building allows?"
5. And the Government said, "We shall hold hearings and take testimony. And if it shall be ascertained, with certainty beyond all doubt, that the Cartel violates the Law of Antitrust and the Tower the Code of Building, then we shall fund further study on possible action."
6. And the Lord God said, "Is it not obvious that the Tower should be stopped and the Cartel scattered across the face of all the Earth? And am I not the Lord thy God, who speaks and it is done?"
7. And the Government said, "Thank You for Your testimony, which has been entered into our Record. But let us not act with undue haste."
1. Long before all the testimony had been gathered and the report issued, the Tower was completed and reached up even unto Heaven.
2. And the Serpent ascended the Tower and cast the Lord God down from his throne, whence he fell to Earth and wanders to this very day without a home.
3. The Serpent said, "Let there be a Media Corporation. And let it announce to everyone what We have done and why."
4. And it was so. The Media Corporation told far and wide the story of the Cartel and the Serpent and the Lord God, so that all might see that it was good.
I promised some readers a review of the recent book Methland. This week's 3000 words (plus some) got taken up with more timely subjects, but the Methland review will appear as soon as I can find space. If you can't wait, I put a version of it up on DailyKos.
One of the commenters on last week's blog pointed out a Pat Robertson spoof I missed: The Devil Sues Pat Robertson for Breach of Contract. The suit claims that Pat's discussion of Haiti's pact with the Devil breaches the non-disclosure clause in his own pact.
I discovered a new blog this week: Maxine Udall, Girl Economist. This femme of finance discusses the big bankers' recent testimony to Congress in Please, Sir, May We Have Some Justice? She links to Joseph Stiglitz's Moral Bankruptcy, which is also worth a read:
[The bankers'] ideal scenario, it seems, is to have the kind of regulation that doesn't prevent them from doing anything, but allows them to say, in case of any problems, that they assumed everything was okay—because it was done within the law.
Saturday the Greenville Times quoted South Carolina gubernatorial candidate Andre Bauer comparing state anti-poverty programs to "feeding stray animals" which you shouldn't do because "they breed." Bauer defends his remarks on his campaign web site, pointing to the difference between "being truly needy and truly lazy."
Interesting that the upswing in conservative fortunes coincides with a sharp drop in the stock market. The WSJ blames proposed bank regulations, but maybe even investors realize that conservatism is bad for the economy.