Campaign finance hearing may have ramifications for corporate personhood

Posted on September 10, 2009


2009corpperson-top35According to Fortune Magazine, the largest American company in 2009 was Exxon Mobil Its total revenues were $442.85 billion. Second was Wal-Mart, with total revenues of $405.61 billion. Rounding out the top 10 were Chevron ($263.16 billion), ConocoPhillips ($230.76 billion), General Electric ($183.21 billion), General Motors ($148.98 billion), Ford Motor ($146.28 billion), AT&T ($124.03 billion), Hewlett-Packard ($118.36 billion), and Valero Energy ($118.30 billion).

According to the International Monetary Fund (IMF), the 182 nations of the world had a combined GDP of nearly $60.9 trillion (or $60,900 billion) in 2008. But comparing the GDP data to the Fortune 500 data produces the table at right (click for the top 182 nations and corporations each, in order). If Exxon Mobil were a country, it would rank 25th in the world, right between Norway and Austria. Wal-Mart would rank 27th, sandwiched between Austria and Taiwan. Chevron would rank 28th, ConocoPhillips 42nd, GE 49th, GM 59th, Ford 60th, and AT&T, H-P, and Valero would be ranked 64-66 respectively.

In fact, all of the Fortune 500 would rank above the 40 smallest national economies in the world. And the smallest company on Fortune’s list of the 1000 largest U.S. companies would be larger than the national economies of 28 entire countries. Exxon Mobil’s revenue is greater than the combined GDP of the 78 smallest countries (out of a total of 182) in the world.

And yet the Supreme Court took the unusual step of ordering a hearing during the court’s recess in order to hear legal arguments over whether corporate money could be spent to influence elections and whether the current bans on most such money in politics were constitutional. And indications are that the conservative majority will likely rule to overturn nearly 20 years of precedent and rule that it is constitutional for corporate money to be spent directly to influence local, state, and federal elections.

According to the Constitutional Accountability Center, the four liberal justices were the ones quoting from the U.S. Constitution to support their questions and arguments:

Justice Ginsburg reminded Olson that it is living persons, not corporations, who are “endowed by [their] Creator with unalienable rights.” Justice Sotomayor, too, picked up on this theme, emphasizing how the Supreme Court had rewritten the Constitution to create the fiction that corporations are persons entitled to the same basic rights as human beings. If we are looking to constitutional first principles to topple precedents, she asked, why shouldn’t we also look at the cases that invented corporate constitutional personhood and “imbued a creature of State law with human characteristics”?

Several of the court’s conservatives are supposed to be Originalists, judges who believe that the meaning of the Constitution was fixed at it’s writing (except for amendments, of course) and has not changed since then. Granting state creations the rights guaranteed to flesh and blood people when the Constitution doesn’t mention state creations is hypocrisy of the first order. It’s also an example of the very judicial activism than the Senate Republicans who voted against confirming Justice Sotomayor feared she would bring to the court. Perhaps the most activist judge on the Supreme Court today, defined by being the most willing to overrule Congress, is Antonin Scalia.

At present, corporate profits may not be spent to directly influence elections. This has historically been the case because corporations can live effectively forever and amass financial resources that no individual person could equal, and because legislators and courts have been concerned about corporate influence corrupting the political process. In essence, these are many of the same arguments that federal law uses to ban foreign nationals and governments from donating money to political campaigns. And yet, to the best of my knowledge, there are no foreign governments suing for free speech rights to influence elections.

The problem twofold – corporations are presently considered people, and money is considered speech. Corporations were defined legally as people for the purposes of limiting personal liability in the event of a business failure. But one of the results is that corporations have claimed the rights guaranteed to real people in the Bill of Rights, specifically the First Amendment right to free speech. And because the Supreme Court declared, in Buckley v. Valeo, that spending money equals exercising the right to free speech, corporations are now claiming that their money should be given identical rights to the money of individual citizens.

There are at least two direct solutions to this problem. The first would be to overturn Buckley v. Valeo. This would make money no longer equal to speech and could be an even more significant change in legal precedent than overturning 100 years of campaign limits on corporate donations to candidates. It would also require the conservatives on the court to go against their known personal ideologies.

The second is to redefine corporations so that they are not considered individual people for all situations. This would certainly require federal legislation and would probably require state legislation as well. It would also require that the economic and political powers at the state and federal levels voluntarily relinquish the power that corporate money (via PACs today, possibly via direct contributions in a few months) brings them.

Neither is particularly likely given the composition of the Supreme Court and the major influence of money in politics today.

Eventually, though, if the laws are overturned, enough companies will corrupt enough politicians with direct donations that they’ll overreach, and the public reaction will be swift and unstoppable. And when that happens, Exxon Mobil’s money and Wal-Mart’s money and Chevron’s money will be as untouchable as money from Hugo Chavez of Venezuela or Mahmoud Ahmadinejad of Iran.

Both of which have smaller economies than either Exxon Mobil or Wal-Mart.

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