Sunday, October 16, 2011

Are Corporations Persons?

In 1886 the US Supreme Court declared that corporationssuch as General Electric or General Motorswere persons for the purposes of the Fourteenth Amendment. In this view, treating corporations as "persons" is a convenient legal fiction that allows corporations to sue and to be sued, that provides a single entity for easier taxation and regulation, that simplifies complex transactions that would otherwise involve, in the case of large corporations, thousands of people, and that protects the rights of the shareholders, including the right of association.

That sounds perfectly reasonable. Corporate personhood is a mere legal fiction for the purpose of court actions and taxation.

Today this fiction has ominous political consequences. Last year in Citizens United v. Federal Election Commission the Supreme Court decided that, being persons, corporations have free speech rights and thus no one may limit corporate political spending. If we tell corporations that they can spend only so much for political campaigns, we are telling them that their ability to speak out on politics is limited andsince they are personthat would contravene one of our most dearly held constitutional principles that all persons are free to speak their mind.

Corporations have a lot more money to spend on political campaigns than you and I. They can engage in a lot more and a lot louder political speech than you and I. In fact this court case may well intensify the corporate ability to drown out citizens' political opinions. Corporations are now the most important “citizens” that get the best hearing because they can yell louder than anyone else. 
It is time to rethink corporate personhood.

Obviously, corporations are not persons. Would you like your daughter to marry one? The fact that corporations will not come to your back yard barbecue to drink beer and talk about the Red Sox is only one indication that this corporate personhood is, indeed, a fiction.

More significant even is that persons are moral beings. We do not always do what is morally right, but the question of morality is always there.

Persons do not only have rights; they have responsibilities. Persons owe gratitude to their benefactors, they have obligations to their parents, and their children. They have civic obligations. They are morally obligated to contribute to the community in which they live, that provided schooling for them, that protects them and their property.

Corporations, typically, are not good citizens. They pollute the environment. In the age of the global corporation, they show no loyalty to their nation or do not hesitate to do business with authoritarian regimes. IBM provided the machinery for Nazi Germany to make list of their Jewish citizens thereby enabling mass killings. General Motors and Ford made trucks and tanks for the US military in the US, and trucks and tanks for Hitler's army in Germany. Anyone with money will find corporations in their corner. During the last two years global corporations like General Electric and Exxon paid no income taxes.

That kind of cold-blooded money-grabbing is not acceptable if people do it. If corporations are persons can we let them be completely oblivious to the moral obligations of persons?

We need to demand that corporations live up to the full implications of their personhood or be stripped of it altogether.