Corporate Accountability

Gans and Kendall on Corporate Rights in the Constitution


David Gans and Douglas Kendall of the Constitutional Accountability Center have produced yet another excellent study in the text and history of the Constitution, this time arguing against corporate personhood in a Discussion Draft titled “A Capitalist Joker”: Corporations, Corporate Personhood, and the Constitution.  (Gans and Kendall previously combined on The Gem of the Constitution: The Text and History of the Privileges or Immunities Clause of the Fourteenth Amendment, among other work.  More here.)  This is an important paper at a critical time–when the issue of corporations’ rights are pending before the Court in the reargued Citizens United v. FEC.  I highly recommend it.

Gans and Kendall trace the ideas of corporate personhood and corporate constitutional rights from the founding and show how they have ebbed and flowed.  Thus they show that the settled understanding until 1886, in Santa Clara v. Southern Pacific Railroad Co., was that corporations were not citizens–they were mere creatures of the law–and they lacked citizens’ inalienable human rights under the Constitution.  Santa Clara changed this understanding, but not because anything the Court wrote in its opinion.  Instead, Gans and Kendall show, “the court reporter–himself a former railroad man–took it upon himself to insert into his published notes Chief Justice Waite’s oral argument statement that the Fourteenth Amendment protects corporations.”  Cases following Santa Clara ruled that corporations have the same constitutional rights as individuals.

In 1937, with the end of the Lochner era, the Court repudiated corporate constitutional rights, and in 1973 in Lehnhausen v. Lake Shore Auto Parts Co., wrote that the idea was “a relic of a bygone era.”  But corporate rights reappeared in First National Bank v. Bellotti, when a 5-4 Court ruled that limits on a corporation’s ability to oppose a ballot initiative violated the First Amendment.  In 1990, in Austin v. Michigan Chamber of Commerce, and in 2003, in McConnell v. FEC, the Court held that corporations do not have the same rights as citizens to spend money to advocate the election or defeat of candidates for public office.

The issue of corporate constitutional rights is again before the Court in the pending Citizen United, reargued in September, before the Court’s ’09 Term officially began.  The case could have a profound impact on the place of corporations in our constitutional system.  Gans and Kendall:

Last June, in Citizens United v. FEC, the Justices took the rare step of calling for a second oral argument and asking the parties to brief whether the Court should overturn Austin and McConnell.  Citizens United has taken up the Court’s suggestion and is arguing for a sweeping ruling that overrules Austinand McConnell and holds that corporations should have the same First Amendment right as individuals to spend money on elections.  A ruling for Citizens United on these grounds would mean that corporations would have a constitutional right to spend unlimited amounts of money–perhaps millions or even billions of dollars–to elect candidates beholden to their special interests and willing to extend their special privileges.  The case, thus, reopens truly fundamental questions about the place of corporations in our constitutional order.

This Discussion Draft is an excellent addition to the CAC’s outstanding collection of materials on the history of the Constitution.  Take a look.




This post can be found in its original form here.