Barish: The Constitution and Corporations Don’t Mix

Posted April 29, 2010 at 10:03am

Every American, hard-left to tea partyer, should be appalled by Citizens United v. Federal Election Commission, the radical Supreme Court decision that held that limits on corporate political spending violate a corporation’s right to free speech. Thanks to this decision, corporations can spend unlimited funds to promote or oppose candidates, advance or impede legislation, and shape public opinion. If political spending is free speech, corporations now have the loudest voice in American politics.

[IMGCAP(1)]The Roberts court decision is the culmination of 200 years of corporate legal maneuvering aimed at establishing corporate rights without surrendering corporate privileges, which include limited liability, lower tax rates and perpetuity, which, alas, aren’t available to private citizens. But the framers of the Constitution never intended to extend right to free speech to corporations — not because they didn’t know about or couldn’t imagine big corporate interests, but because they could and did. The Founding Fathers frequently expressed concern that powerful corporations could, if unrestrained, “mingle in elections,” manipulate government, dictate laws, and destroy the principle of equality fundamental to democracy.

The founders’ fears were based on experience. The colonies had been exploited and abused not only by the British monarchy, but by British corporations including the Massachusetts Bay Co., the Hudson’s Bay Co., and the British East India Co., on whom they finally unleashed their anger in the Boston Tea Party. The War of Independence was a violent rejection of monarchy, monopoly and corporate power. Early Americans, however, needed corporations to help build public works. The states chartered small corporations, but were careful to maintain control. They granted temporary, revocable and limited charters so that they could keep corporations and what James Madison called “the indefinite accumulation of property” by corporations small, because “the growing wealth acquired by them never fails to be a source of abuses.”

These fears were justified. Almost from the beginning, new corporations sought to expand their power. They appealed to the federal courts in an effort to declare the states’ charters illegal. They hired lawyers to establish their status as “legal persons,” so they could demand civil rights and protections. In a letter to a friend in 1864, President Abraham Lincoln wrote, “Corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed.” The ink was barely dry on the 14th Amendment when, after the Civil War, corporations pounced on the right to due process.

Citizens United opens the gate to “an era of corruption in high places.” In a climate of unlimited corporate political spending, what candidate would dare support campaign finance reform, or clean air and water standards, knowing it would unleash a flood of corporate-financed attack ads? The threat of such ads would probably be sufficient to corrupt the democratic process. Likely and understandable public perception that elections are for sale to the highest (corporate) bidder will lead to cynicism, apathy and anger. It is precisely what the Founding Fathers feared.

In writing for the majority in Citizens United, Justice Anthony Kennedy correctly notes that “transparency enables the electorate to make informed decisions.” But his assumption that current law provides such transparency is sadly mistaken. Corporations are not required to disclose political spending even to shareholders. If you are a shareholder or have a 401(k) invested in stocks, the corporation manager can spend your money to advance his personal political agenda, or to elect a candidate whose views you find repugnant. You won’t know he did it, and if you knew, you would have no recourse.

Congress must act forcefully to undo the harm of Citizens United. Ideally, it should pass a constitutional amendment to redefine the “personhood” of corporations and withdraw their entitlement to our civil rights. At the very least, it should enact “shareholders’ rights” legislation, amending Federal Election Commission regulations and federal securities law to (1) require corporations to disclose political spending to shareholders, (2) require advance authorization from shareholders for political spending, and (3) require that corporate managers who spend political money without authorization be held liable for what they spent. These conditions would provide transparency and a voice for shareholders in deciding how their money is spent.

These changes should draw support across the political spectrum. Every American who thinks, as the founders did, that the rights of citizens should take precedence over the rights of concentrated money interests, should urgently petition Congress to remedy Citizens United before the next election, which is fast approaching this fall.

Leora Barish is a screenwriter.