by Bruce Shields
On Town Meeting Day many Vermont towns will find an article in their warning supporting a “Saving American Democracy” [SAD] amendment to the US Constitution, as proposed by Senator Sanders and Congressman Welch. The stated purpose of SAD is to deny “personhood” to corporations. The real goal is to prevent corporations from speaking out on public issues, especially during elections.
Senator Sanders on his web site argues that the Founding Fathers never intended for corporations to be treated as persons. Sanders (SJR 33) and Welch (HJR 90) propose limiting the scope of the First Amendment to individual private or “natural” persons, as opposed to the “artificial” person created by incorporation.
The SAD effort hopes to overturn a 2010 U.S. Supreme Court case titled Citizens United v. Federal Election Commission, which the Left claims first introduced the idea that corporations are people.
Congress first imposed tight limits on campaign finance in 1974 amendments to the Federal Election Campaign Act [FECA], which capped both total spending and individual contributions to campaigns. In Buckley v. Valeo (1976), the Supreme Court on First Amendment grounds voided caps on total spending by candidates. However it did not address the cap on contributions, even though spending clearly is linked to contributions.
Subsequent courts have not touched Buckley v. Valeo. Despite that case’s partial victory for free speech, the FECA spending limits did achieve a part of their goal. From 1974 onward, the rate of reelection of incumbents has been higher than ever before.
Spending limits manifestly benefit incumbents. Not surprisingly, incumbents overwhelmingly support caps on campaign spending. For candidates who mount attacks upon “giant corporations,” muzzling any potential response from the target simplifies the process.
Two recent cases have clarified the loose ends of Buckley v. Valeo. In March 2010 the DC Circuit Court of Appeals decided Speech Now.org v. Federal Elections Commission. The decision specifically gives First Amendment protection to corporation, union, and individual contributions to advocacy organizations [“Super PACs”] not connected to a candidate’s campaign. The US Supreme Court declined to review Speech Now, effectively affirming its findings.
Earlier that year the Supreme Court ruled in Citizens United that all sorts of organizations possess an inherent free speech right to support independent committees that argue their views about issues and candidates. The longstanding caps on contributions by corporations to candidate committees continue in force, on grounds of minimizing opportunity for political graft.
In attacking the right of groups and associations of citizens to speak out in the election process, the Left is mounting a frontal attack on the principle of free of speech and association.
Corporations have been recognized as persons ever since English courts of law first protected incorporation from Royal prerogative in the 16th century. Incorporation protects the property and the rights of individual persons precisely because it affirms the social utility of a group of people organized to function as one person before the law.
This principle was brilliantly enunciated by Daniel Webster in his famous brief and affirmed by the Supreme Court almost 200 years ago in the pivotal Constitutional case, Trustees of Dartmouth College v. Woodward. Chief Justice John Marshall’s opinion in the Dartmouth College case contains a detailed history and affirmation of corporate personhood, and declares that corporate persons enjoy every right guaranteed in the Constitution.
Curtailment of the scope of the rights of associations as proposed in SAD would ultimately deprive all for-profit business corporations – but not labor unions, the Sierra Club, VPIRG, and other anti-business advocacy groups – of their constitutional right to speak out in support of their interests and views.
Finally, a footnote to the Left: had the 1974 spending limits been in force, anti-war Senator Eugene McCarthy could never have run for President in 1968. The “Saving American Democracy” petition ought to be renamed the “Trash the First Amendment” petition, and rejected.
Bruce Shields is President of the Ethan Allen Institute. (www.ethanallen.org)