Are Corporations People?
One of the Occupy Wall Street slogans was “ corporations are not people.” But what does this mean? People have a variety of rights, including the right to sign (and be obligated by) contracts, the right to free speech, and the right to vote. When the Supreme Court decided that corporations are persons (as it did in 1819), the court meant that corporations have some of these rights (such as the right to sign contracts), but not others (such as the right to vote, which is reserved to “citizens,” not “people”).
When Mitt Romney said, “Corporations are people, my friend,” he didn’t mean it in a legal sense but in the sense that corporations are made up of people and corporate profits eventually end up in the hands of at least some of those people.
The question is: where do we draw the line? If we deny corporations the right to contract, then corporations could not exist, as the whole point of corporations is for investors and managers to contract with one another. While some may think eliminating corporations is a good idea, without corporations most goods would be a lot more expensive and it is likely that wealth would be even more concentrated in the hands of a few because only those with wealth would be able to invest in productive activities that could return large profits.
Occupy Wall Street’s more overt goal is to overturn Citizens United v. FTC, the Supreme Court decision that held that Congress could not limit political spending by corporations. The Supreme Court has already held that the Fifth Amendment right to self-incriminate and the right to privacy do not apply to corporations. So why should the First Amendment right to free speech apply?
First of all, corporations are voluntary associations of people, so to deny rights to corporations is the same as denying those rights to the people in those corporations. Non-profit corporations, including churches, charities, unions, and many universities, are also corporations, so any rights denied to Exxon-Mobil will also be denied to groups such as the Sierra Club and the National Educational Association. (Citizens United was a non-profit corporation.)
If corporations are denied First Amendment rights, would any associations of people be allowed First Amendment rights? For example, would limited partnerships or family-owned companies be allowed such rights? Koch, Bechtel, Hearst, and Publix are all privately held companies that could easily abandon the corporate form, if they haven’t already, so they could express their First Amendment rights. Until a couple of years ago, Goldman Sachs and Morgan Stanley were both privately held, and could easily return to that status if needed. Most of Ford Motor Company’s voting stock is family owned, and it could become privately held without too much pain.
The point is that any scheme to take First Amendment Rights away from some associations of people would require that First Amendment Rights be taken from all associations of people. If that were the case, then the only organizations able to express freedom of speech and freedom of the press would be the government–which would not be a good thing.
“It is truly enough said that a corporation has no conscience,” wrote Henry David Thoreau, “but a corporation of conscientious men is a corporation with a conscience.” Efforts to solve problems by denying First Amendment rights to corporations or anyone are likely to only make those problems worse.
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