When I attended an FEC hearing on possible new rules to prevent foreign-owned U.S. subsidiaries from donating to U.S. campaigns, I was struck at how each side was talking past the other.
While the Republicans had a modest proposal to keep foreign money out of U.S. elections and the Democrats had a more comprehensive one, the Commission deadlocked on both. We remain where we started: no new rules on keeping foreign money at bay.
In the spirit of trying to build some common ground, perhaps we can at least agree on the history that led us to the point where we disagree. In my book, Corporate Citizen? An Argument for the Separation of Corporation and State, I explain how corporations have changed over time and how their legal rights have expanded. And why it is so problematic to share a democracy with large corporations.
Having a big corporation in a democracy is like sharing the road with a tractor-trailer. If the tractor-trailer’s driver isn’t thoughtful, they can drift into your lane causing mayhem. And just because of their sheer size, smaller cars (like speakers with smaller budgets) may have to yield to the corporate 18-wheeler barreling down the road. As a way of organizing a business, corporations are older than America. They existed for centuries in Europe before the U.S. was a country. At the founding, corporations were rare. The reason was that a corporation could only be created by an act of a state legislature. Not everyone had the ear of a legislature, and so only a favored few won the privilege of being a corporation.
But things changed and now nearly anyone who can pay a nominal filing fee can set up their own corporation. Early state laws also had limits on how much money a company could have and sometimes how long a corporation could last. Those restrictions also fell by the wayside. Now corporations can grow as large as they wish (subject to antitrust laws) and can last indefinitely.
Corporate lawyers have been greedy for new rights for their clients. They successfully argued to the Supreme Court that corporations should (like their human counterparts) be covered by the Fourteenth Amendment’s Equal Protection Clause. Arguably corporations got more protection from this part of the Constitution for decades than the ex-slaves it was intended to protect. And it’s not difficult to see why. The ex-slaves had few lawyers to expand their rights; the largest corporations of the day, often railroads, had the best representation money could buy.
The immortality and size of corporations are two reasons why I find granting them political rights particularly inappropriate. But this is precisely what the Supreme Court (and many lower courts following the Justices’ lead) have done. In cases like Bellotti which allowed corporations to spend in ballot initiatives and Citizens United which allowed corporations to spend in candidate elections, corporations are accruing rights once enjoyed only by human beings.
Corporations have been chomping at the bit to expand these rights. One case they hope to overturn is called Beaumont. This ruling upholds a long-standing federal ban on corporations giving directly to campaigns of federal candidates. Corporations have built on their First Amendment rights in Citizens United by arguing and winning religious rights in Hobby Lobby. There is potentially no end in sight save for the fact that these rulings are judge-made decisions. Just as judges created Citizens United and Hobby Lobby, a future court can undo this damage slowly, case by case.
Until the Supreme Court changes course, we are stuck with Bellotti, Citizens United and Hobby Lobby. Corporations are now in our elections and they’re empowered to claim religious exemptions from democratically-enacted laws. And so we are the small car driving with corporate big rigs in the next lane. All we can hope is that they drive responsibly and don’t drift dangerously into our lane pushing us off the road as we try to make it safely home.