How Corporations Became People

Part One of The Great Free Speech Robbery

How did the US media lose their way, ultimately replacing a "free marketplace of ideas" with perception management by a handful of conglomerates? Actually, the danger was there from the start, when the new nation’s “founding fathers” struggled to create a system of government acceptable to semi-autonomous states. During those early debates, one of the main architects, James Madison, expressly warned that, unless specifically protected, individual freedom would be vulnerable. Nevertheless, the resulting US Constitution, as ratified in 1788, provided no explicit protection for basic rights like freedom of speech.

Madison's argument was that establishing a democratic system wasn’t enough by itself to ensure the right of everyone to participate. On the contrary, "the invasion of private rights is chiefly to be apprehended not from acts of government contrary to the sense of its constituents but from acts in which the government is the mere instrument of the major number of the constituents," he explained. Madison had thus come to believe that government "should be disarmed of powers which trench upon those particular rights (of speech, press and religion)." Here lay the basis for his great campaign to add a Bill of Rights to the new Constitution.

Opponents replied that such additions were unnecessary, since the federal government had been given no power to suppress speech or other rights. Noah Webster even suggested that including "inherent" rights such as freedom of speech would be as ludicrous as asserting in the Constitution the right to hunt and catch fish on one's own land, to eat and drink, or to sleep as one chooses. No doubt he would have been shocked to learn that several of these "rights" have since been called into question.

Not having the benefit of hindsight, Madison simply reminded his critics that "freedom of the press and rights of conscience, those choicest privileges of the people" were unguarded in the British constitution, and, as the new Americans knew well, were consistently violated. To avoid repeating Britain's mistakes in the recently liberated colonies, he proposed that certain fundamental rights be placed beyond the reach of government, the assumption being that an overbearing regime was the main threat to freedom. Madison contended that the free exchange of ideas was a personal right, beyond the scope of government authority. He also objected strongly to "majoritarian" control of speech. The greatest danger to liberty, he suggested, was to be found "in the body of the people, operating by the majority against the minority."

Despite those warnings and the protection provided by the First Amendment, however, developments in the 19th and 20th centuries considerably undermined "those choicest privileges of the people." One of the most damaging was the revolutionary Supreme Court ruling, in the 1886 Santa Claria County v. Southern Pacific Railroad case, that corporations were persons within the meaning of the 14th Amendment. The Amendment had been passed after the Civil War to assure that no state could abridge the privileges of citizens or deny equal protection under the law. It was the most significant legal change of the reconstruction era, subsequently serving as a basis for more Supreme Court cases than almost any other constitutional provision.

Ostensibly, the 14th Amendment was designed to protect the newly won freedom of Black Americans and make the first eight amendments to the Constitution applicable to the states. But the ambiguity of its language also allowed the Supreme Court to interpret the law narrowly in terms of citizenship rights, while simultaneously extending "equal protection" to businesses. Ultimately, the 14th Amendment was transformed into an important tool for vested interests. In the heat of the industrial revolution, emerging US trusts and corporations were eager to limit government involvement in their expansion plans. With the help of savvy laissez-fair lawyers, they began by using the new Amendment as a bar against social legislation. Thanks largely to Roscoe Conkling, however, the Santa Claria decision reached even further.

A lawyer and leading stalwart Republican whose presidential aspirations were thwarted in 1876, Conkling was a major force in US politics during this period. His feud with President James Garfield over political appointments was still raging when Garfield was assassinated by one of Conkling's misguided supporters in 1881, putting Conkling protege Chester Arthur in the White House. When the Santa Claria case reached the Supreme Court, Conkling, who had helped write the 14th Amendment more than a decade earlier, persuaded the justices to accept his interpretation of what it meant.

The drafting committee had "conspired" to extend equal protection to corporations, he said, by using the word "person" rather than "citizen." Though this so-called “conspiracy theory” was later exposed as a fraud, the Court accepted his argument and broadened the application accordingly. The impact on subsequent rulings regarding "corporate speech rights" was profound and far-reaching.

Almost a century later, after public pressure forced the US Congress to limit contributions and expenditures for political campaigns in 1971, the Supreme Court used free speech as a basis for striking down limits on spending. Such limits, they argued, would reduce the "quantity" of political speech. Defining the spending of money as a form of speech, the majority ruled that only contributions could be restricted. Despite the emergence of equality as a basic social value, it was not to be applied to speech. Speakers without money might be "leveled up" slightly by limited access requirements, but wealthy speakers could not be "leveled down."

The Court also ruled that, since corporations have speech rights, they can’t be prohibited from spending money to influence the outcome of a vote, whether or not the outcome would directly affect them. In First National Bank of Boston v. Massachusetts, the Supreme Court majority ruled that speech can’t be restricted simply because the source is either a corporation or a union. In his dissent, however, Justice White noted that the self-expression function of the First Amendment "is not at all furthered by corporate speech." If ideas aren't a product of individual choice, he argued, constitutional protection can certainly be limited. He added that, "the restriction of corporate speech concerned with political matters impinges much less severely upon the availability of ideas to the general public than do restrictions upon individual speech."

White believed that corporations are artificial entities created to make money, and acknowledged the widely recognized need "to prevent corporate domination of the political process." As long as freedom of expression was essentially protected, he saw no problem in some "curtailment of the volume of expression."

Justice William Rehnquist, a Nixon appointee, issued his own dissent in the same case. Mentioning that Congress and at least 30 states felt some restrictions on corporate political activities were justified, he argued that business purposes could be fulfilled without the liberties of political expression, and, quoting Justice Marshall, defined the corporation as "an artificial being, invisible, intangible and existing only in contemplation of law."

Part Two: New Players, Same Old Game