“A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law. Being the mere creature of law, it possesses only those properties which the charter of creation confers upon it, either expressly, or as incidental to its very existence. These are such as are supposed best calculated to effect the object for which it was created.”
- Chief Justice John Marshall, in Dartmouth College v. Woodward (1819).
Years from now, when the fiction of campaigning for public office is dispensed with and political seats are simply bought, sold and traded on national and local exchanges resembling the stock market where other valuable commodities are negotiated to the highest bidders, we might ask ourselves how our political process came to look like a corporate version of one of those science fiction stories where humans lose control over the ever-sophisticated robots they have built and which end up taking over the earth. (Think, “I, Corporation,” or perhaps, “The Corporator.”)
For the corporations which the U.S. Supreme Court unleashed last month in its landmark campaign finance decision in Citizens United v. Federal Election Commission (NYLJ, Jan. 22) are just that; creatures of the states that beget them, legal fictions that exist only in the mind of the law as vehicles of commerce, protecting shareholders and management from personal liability for bad or unlucky business decisions. The corporate form is an artifice, a construct, for which special tax policies and other incentives are built in order to channel and promote economic growth. Corporations do not exist naturally, but are literally created by law, almost always the law of the particular state in which the corporation is incorporated, and with the powers and limitations that these corporate birthing statutes enumerate.
New York’s incorporation statute is typical. It gives corporations spawned pursuant to New York law certain enumerated powers, such as to acquire and sell property; to sue and be sued; to enter into contracts; to borrow and lend money; to adopt by-laws and elect or appoint officers; to establish a pension plan; and to “make donations, irrespective of corporate benefit, for the public welfare or for community fund, hospital, charitable, educational, scientific, civic or similar purposes, and in time of war or other national emergency in aid thereof.” The latter is clearly a reference to charitable—not political—giving, but the point is a corporation’s powers are only those which are itemized in its state’s incorporating statute. Whatever the corporation can do, it can do only because the state empowers it to do so; this includes its very ability to exist. Indeed, the federal Constitution is completely devoid of any requirement that states facilitate or permit corporate formation within their jurisdictions at all; the notion is almost laughable.
Yet now corporations stand on like footing with people in terms of their ability to participate in the political process. As surely as Citizens United eliminated any restrictions on corporations’ independent expenditures in direct support or opposition to a candidate for office, the remaining distinctions between permissible corporate and citizen election activity will fall one by one under the weight of Citizens United’s reasoning: the prohibition of corporate donations in federal elections; the lower limit on aggregate corporate contributions in New York state elections; etc.
Much has been written and said about the Supreme Court’s Citizens United decision having overturned a hundred years of precedent prohibiting corporations from participating in elections on equal terms with humans, but the notion that we Americans of the flesh-and-blood variety share our political rights with Americans of the books-and-records kind—the essential premise of Citizens United—has its legal antecedent in a 1978 case involving (not surprisingly) corporate efforts to prevent Massachusetts from instituting a graduated income tax. This is really where Dr. Frankenstein first lost control of his creation.
Before that case, First Nat’l Bank v. Bellotti, 435 U.S. 765, the concept of corporations and political rights was a strictly utilitarian one. Those corporations whose very function is the exercise of speech or advocacy, such as publishing corporations like The New York Times or civil rights organizations like the National Association for the Advancement of Colored People, were understood to enjoy the fundamental protections of the First Amendment. To deny them, would be to uniquely deny the protections of the corporate form to those “in the business,” so to speak, of core political activities. But no one would have put every corporation engaged in any kind of business seeking to influence any given political situation on an equal footing, doctrinally, with real, live people when it came to the full force and effect of the first amendment. And as for the rest of the Constitution, some non-political rights enjoyed by people, such as the right to privacy or the right against self-incrimination, have been denied to corporations, while others, such as the prohibition against double jeopardy and unlawful searches and seizures, have been recognized.
Massachusetts believed, sensibly in dissenting Justice William Rehnquist’s view, that what the state giveth, the state can taketh away; or at least withholdeth. That is, the special charters given to corporate entities solely through the grace of state law providing them privileges and immunities not enjoyed by individuals or other associations of people, and which allow for the enormous accumulation of economic power, should in their terms be allowed to limit the ways in which such corporate entities use that enormous economic power to influence the political process of the mere humans who lack such special privileges and immunities.
Seems fair, no?
But five members of the Supreme Court didn’t see it that way in 1978, and the idea of a corporate political soul was born. Massachusetts’ prohibition on corporate political activity, narrowly tailored to political activity not directly affecting the corporate entity’s actual business interests and operations, was stricken.
Thirty years later, the logical consequences of that decision were brought to fruition in Citizens United, giving corporations full equal rights with people in our political process, even as they have exponentially greater power than people due to the special treatment corporations receive from states; states which are no longer able to restrain their creations in any meaningful way.
Science fiction tales of human creations—be they machines or monsters—turning on their creators always describe the moment of epiphany when the creation gains self-awareness, a knowledge of themselves as being separate and apart from—and, upon reflection and consideration, superior to—their human creators. Either for humankind’s own good or simply for the good of our newly sentient creations, the only logical solution in their view is to use their overwhelming power and advantage to shape the future to their own vision of what’s best.
From Bellotti to Citizens United, Mary Shelly, Isaac Asimov and James Cameron would be horrified that facts have caught up with their fictions.
Rory Lancman represents the 25th Assembly district in Queens. He is a member of the Judiciary Committee and appellate counsel to Morelli Ratner.