Last Wednesday, 9 September 2009, the Supreme Court convened before their October 2009 term begins to rehear a case that was held over from the October 2008 term. Since that case was initially heard, the composition of the Court has been altered by President Obama’s nomination of Justice Sonia Sotomayor to replace retiring Justice David Souter. The case, Citizens United v. Federal Election Commission (FEC) (Docket No. 08-205), goes to the nature of our democracy and what voices should be heard in the electoral process.
There is no question that campaign finance is not the sexiest public policy arena; to many, it is the most esoteric. Citizens United v. FEC challenges the restrictions on corporate speech during elections. Some background: there have been laws regulating spending in elections (and corporations spending money in them) since 1907. It wasn’t until Watergate that Congress developed a comprehensive regulatory scheme, through the Federal Elections Campaign Act of 1973 (Pub.L. 92-225). That law had strict contribution and spending limits for donors and campaigns, respectively. In 1976, the Supreme Court handed down Buckley v. Valeo, 424 U.S. 1 (1976), which invalidated the spending limits, but upheld the contribution limits and restrictions on corporate speech.
Citizens United stems from the FEC’s refusal to allow the corporation to pay to distribute “Hillary: The Movie” prior to the primaries last year, ruling that the film constituted an electioneering communication, which corporations were prohibited from paying for within 30 days of a primary or 60 days of a general election. The plaintiffs argue that it is unconstitutional to limit “corporations’ independent spending during campaigns for the Presidency and Congress.”
This stems from a legal argument that the corporation is a person, and thus entitled to all the rights of a person under the U.S. Constitution. In 1886, the Chief Justice Morrison R. Waite said, prior to the Santa Clara County v. Southern Pacific Railroad Company, 118 U.S. 394 (1886), oral argument,
“The court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws, applies to these corporations. We are all of the opinion that it does.”
The court reporter later included this in the syllabus and case history. This was eventually passed by Congress and codified at 1 U.S.C. §1. On 15 September 2009, Stephen Colbert presented this information in an amusing segment of “The Wørd.”
If the Supreme Court broadly overturns the limitations on corporate speech in elections, it will open the door for millions, if not billions, of dollars to flow into the electoral process, dwarfing the sums that citizens are able to contribute. Today, corporations (and unions) are prohibited from contributing to campaigns from their general treasuries. They can finance ads within strict parameters. If the wall that Congress has attempted to construct between politics and the economy – or to borrow a phrase from Robert Kerr, to “subordinate the economic to the political” – is torn down, we will not like the results.
All of the federal campaign finance laws were drafted and enacted to combat the corrupting influence of corporate money in the political process. Rep. Barney Frank (D-MA) has said “Politicians are the only human beings in the world who are expected to take thousands of dollars from perfect strangers on important matters and not be affected by it.” As it is, money already permeates our elections. Barack Obama decided against seeking public financing of his presidential campaign, and raised (and spent) over $600 million dollars. The entire 2008 election cycle (President, Senate, and House) cost about $5.3 billion dollars.
The Supreme Court stands poised to unleash the beast into the process. In the 2009-2010 election cycle, a citizen is limited to contributing $2,300 per election, $4,600 total (primary + general). Exxon posted a profit of $45.2 billion dollars in 2008. It is time that we recognize that corporations are not people. They should not be legally treated as people. While the legal fiction was useful in the development of the economic framework, which dates to the 19th century, it has outlived its usefulness. A new framework, which preserves the attributes necessary for the economic purpose of the corporation, such as limited liability, but does not equate the corporation to a person, is needed. The myth of corporate personhood exists only in statute. There is no reference to a corporation anywhere in the Constitution and a court should not be able to read such corporate rights into it.
We will not like the election cycles to come if the flood gates are opened. The electoral process will be inundated with money. Corporations have a major stake in the status quo, and would prefer reforms to bend in their direction, often in opposition to the public good. A single corporation, were it to spend all its profits on electioneering activities, would distort the electoral process beyond recognition. While we may not like the election cycles to come, we will like the results of future Congresses even less.
Mike Schillawski is the President of the Cornell Democrats.
