CITIZENS UNITED v FEC: One Year Later

Americans have forgotten about what I believe to be one of the worst Supreme Court decisions since Dred Scott (the name commonly given to the 1857 decision affirming the Fugitive Slave Recover Act), Plessey v Ferguson (the 1896 ³Separate but Equal´ decision) and, least we forget, the 2000 Bush v. Gore decision. Only time will tell whether this characterization is justified. Some feel that it will not make any difference ± it¶s ³no big deal´ ± but this may be only because corporations so dominate public discourse and government policy already that this decision is just a continuation down the slippery slope of corporate dominance of government affairs. There¶s only one more step to the bottom; direct corporation contributions to campaigns. At the heart of the Court¶s (5-4) decision extending First Amendment rights to corporations is the belief that our legislators and leaders are somehow immune from corruption. I¶m relieved to discover that the Court¶s majority finds ³quid pro quo corruption´ ± in other words, verifiable, out-and-out bribery ± objectionable. However, apparently, everything else is just an exercise of free speech²the free, uninhibited flow of ideas. Donations to campaigns (wink, wink) that result in favorable treatment later on, is ³access,´ not corruption. A junket to attend, say, a pharmaceutical sponsored event at Hilton Head, dine with corporate leaders, and play lots of golf is OK. If this looks and smells like corruption, well, that¶s just a misperception the public will have to get over. After all, free speech is absolute²NO exceptions. (More about that later.) Stanley Fish, law professor and New York Times columnist provides an excellent analysis of the conflicting views of the majority and minority Court. Fish points out that the word that best describes the majority view is ³chill´, as in, any restriction of corporate speech has a ³chilling´ effect. The word that best describes the concerns of the minority is ³corrupt´, reflecting a belief that corporate speech and money have a corrupting effect. Therein lies the irreconcilable divide

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t was one year ago this January that the Supreme Court decided the case known as Citizens United v FEC. By now, most

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CITIZENS UNITED v FEC: One Year Later
of the First Amendment ³absolutists,´ on the one hand, and ³consequentialists´ on the other.1 I recommend reading Professor Fish¶s article and many of the almost six hundred online comments logged in response to it. [Note that you can select the ³Highlights´ tab or sort them by clicking the ³Reader¶s recommendations´ tab to read a sampling of comments.] Many are extraordinarily insightful. As for the Supreme Court decision itself, the most persuasive argument comes not from the majority opinion, but from the minority opinion written by Associate Justice John Paul Stevens. This ninety-page dissent is both clear and persuasive reasoning, and brilliant writing. When I read it, the first question I asked myself is, ³why did he put so much effort into this?´ After all, the vote has been taken; it was 5 to 4. He¶s arguing for the minority. At eighty-nine and ready to retire, it seemed a Herculean effort. I¶ve come up with three possible explanations: he thought his dissent itself might persuade one of those who had voted with the majority to change sides (unlikely, since the only likely swing vote, Justice Kennedy, wrote for the majority); that this was his last decision and he wanted it to be memorable (it is); and/or, he felt that he was laying the groundwork for a reversal, at some future date. His dissent provides all the fuel a future Court would need to override this decision; one that disregards over one hundred years of precedent.2 While I don¶t intend to address each of the Courts arguments (Justice Stevens does that best,) here¶s a summary of the most important points. y The assault on common sense and the Constitution: Corporations are not people. (For

the benefit of strict Constitutional constructionists, the word ³corporation´ does not appear even once in the Constitution or its Amendments. Do a word search. Go ahead.) y The ³money equals speech´ argument. Again, most Americans find this an assault on common sense and fairness. The ability of one class of people to so dominate the ³bandwidth´ as to drown out all other voices suppresses rather than advances free speech.

See Stanley Fish Citizens United v FEC article This decision including J.P. Steven¶s dissent can be read by going to this webpage -- Supreme Court 2009-10 Decisions and downloading the .pdf of the ³Citizens United vs. Federal Election Comm¶n´ decision (number 19 in the list).
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CITIZENS UNITED v FEC: One Year Later
Reasonable limits on campaign contributions should be retained to ensure all voices are heard. y Erosion of prohibitions on corporate influence. This is just the latest in a series of decisions expanding corporate political rights. y The myopia of the court as evidenced by the majority statements on corruption. ³What planet are they from?´ Or, what boardroom. y The ³Well, newspapers are corporations aren¶t they?´ argument. Yes, but as a class, they are granted an explicit protection in the first amendment. They are the essential fourth branch of government. y The ³Free speech is absolute and should be unrestrained´ argument. No one is suggesting individuals be muzzled ± that includes corporate leaders; they should just do it on their own dime. y y The Court blithely ignored the international makeup and allegiance of corporate officers. The Court ignored precedents and case law. The text of the decision and the dissent are the best place for this level of analysis. I¶m not a lawyer, but a few landmarks are worth noting (below). y Chief Justice John Roberts made numerous statements regarding ³stare decisis´ (the importance of precedents in law) during his confirmation hearings. I won¶t go into this aspect of the case other than to note here that during the Robert¶s hearings, he emphasized this belief to ³stare decisis´ many, many times. y The Court ignored the inevitable consequences of 1) its decision and 2) the effects of the expansion of corporate influence. In doing so, it also ignored clear evidence that Congress unearthed during many long hours of hearings²evidence that informed the legislation it passed. y Will restricting the speech of Exxon-Mobil, Coke or GE have a ³chilling effect´ on the free exchange of ideas? y Remedies: Just for fun, what would a Constitutional Amendment look like?

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CITIZENS UNITED v FEC: One Year Later
I won¶t be addressing all of these here, but I have included this list as food for thought. Let¶s just examine a few of them.

The Supposed Incorruptibility of Congress
As I mentioned at the outset, at its heart, stripped of all other pretense, the majority decision rests on these two highly questionable assertions: 1) ³« this Court now concludes that independent expenditures, including those made by corporations, do not give rise to corruption or the appearance of corruption. That speakers may have influence over or access to elected officials does not mean that those officials are corrupt. And the appearance of influence or access will not cause the electorate to lose faith in this democracy.´ and, 2) ³The hallmark of corruption is the financial quid pro quo: dollars for political favors.´ (italics are mine.) The first ³don¶t worry, be happy´ statement flies in the face of centuries of evidence to the contrary. Take the clause ³That speakers may have influence over«´ What is corruption if not inappropriate ³influence over´ a government official? I agree, ³access´ does not mean that corruption is afoot. But, financial contributions certainly raise the ³appearance of corruption.´ One must ask, why would corporations donate funds if not to influence or corrupt? Did the Court hold hearings before reaching these conclusions? Is the Courts assertion that ³expenditures « do not give rise to corruption´ based on evidence or academic research? Did it base it on any evidence? Is it based on historical precedent? No and No« it is simply based on five Justices¶ opinion. Maybe they conducted a private poll of legislators: ³Have you ever been swayed by corporate contributions, or the threat of a corporation withholding a contribution?´ ³No sir. Certainly not!´ At the least, you would think that the Court could site studies or evidence to support their opinion« but nothing. Have the justices not noticed what¶s been going on in Washington? Have they never heard of K Street? Faced with criticism of this decision, Clarence Thomas responded that the NY Times and Washington Post are corporations. Assuming that this was a serious response, what does that mean? That the decision was a swipe at these two papers? Certainly this statement reflects the antagonism some members of the Court feel towards the two publications, but it flies in the face of the Constitution and the First Amendment, which extends freedom of speech to the Press, not

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CITIZENS UNITED v FEC: One Year Later
to Exxon-Mobil, Walmart, GE or Wendy¶s. (The decision to allow GE or Disney or whoever to buy media organizations is worth revisiting.) The notion that limiting the speech of corporations somehow limits the free flow of information is absurd ± no one is limiting the speech of the individuals who make up corporations. Within the constraints of the law, they are free to speak. So. One has to ask, from what oxygen-deprived bubble did these five Supreme Court Justices emerge? We can read about the pernicious effects of corruption and the ³appearance´ of corruption practically every day3. Are they so ill informed? Maybe they should spend more time reading the Times or the Post.

© New Yorker Jan 31, 2011

3 One brief example: Ten years ago, private for-profit colleges were minor players. Today, organizations like the University of Phoenix (owned by the Apollo Group) and the Kaplan College Company (owned by the Washington Post Company) garner 91.5% of the sixty-five billion dollars ($65 Billion) of all moneys allocated by the Federal Government to higher education. These companies prey on the least qualified applicants and returning vets. They use deceptive practices to recruit and retain students. How did this come about? One of those organizations (and not the only one), Kaplan Colleges, has increased their political donations and lobbying dramatically over the same period. Coincidence? An oversight? This is just one not-so-small example of how corporate special interests dominate the legislative process and profit from it. Their foot is firmly in the door; don¶t expect them to go away. This is just one example of hundreds of similarly well-financed industries writing the rules in their favor. [To read a series of articles on For-profit Colleges, click here NY Times For-profits College articles] Quid pro quo corruption? You decide. As we witness the debate to bring our National budget in balance, this is something to keep in mind.

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CITIZENS UNITED v FEC: One Year Later The Court¶s Assault in Common Sense and the Constitution
The majority of Americans4 find the notions that ³corporations are people´ and that ³money equals free speech´ offensive. As corporations gain a stranglehold on the popular culture and government policy through advertising, PACs and their lobbyists, common sense suggests something is seriously amiss. The courts decision seems to fly in the face of the widely held perception that corporate influence needs to be restrained, not expanded. As Justice Stevens says in his final paragraph, ³While American democracy is imperfect, few outside the majority of this Court would have thought its flaws included a dearth of corporate money in politics.´ Occasionally, a decision or action violates a universal and deeply held sense of right and wrong. This decision appears to have crossed that line. Polls indicate that 80% of the population thinks this decision was wrong²a majority of Republicans, Democrats and Independents. While I tend to believe common sense is just another ay of saying ³lowest common denominated´, in the case of Citizens United, it is backed up by lots of supporting not-so-common evidence. First, as I noted earlier, the word ³corporation´ does not appear anywhere in the Constitution or its Amendments. Not once. Second, corporations are defined by state statutes and operate under the laws of the various states in which they are registered. They are legal persons, not natural persons. (More about that distinction later.) Third, the Federal role regulating corporations is derived almost exclusively from the ³Commerce Clause´ of the Constitution (Article I, Section 8). Since most corporations operate across national and/or state boundaries, most are subject to federal laws and regulations. While a very few corporations existed in the late 18th Century, corporations grew rapidly in the mid-19th century, spurred on by the Civil War and Reconstruction. Naturally, laws governing their influence lagged behind and corruption became commonplace. For decades, Robber Barons called the shots. Corporations bought and sold legislators. Since legislators were beholden to people like JP Morgan, Jay Gould, John D. Rockefeller, Cornelius Vanderbilt, to name a few, they were reluctant to pass any laws that would upset these oligarchs. Sound familiar? It took Teddy Roosevelt¶s stubborn, aggressive leadership and the trust-busting legislation he championed to curtail their influence and establish a modicum of control.
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See Article on ABC News/Washington Post polling

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CITIZENS UNITED v FEC: One Year Later
Corporations are established by law to fulfill some commercial purpose. The law allows people to join together under a legal framework that subjects the corporation to legal requirements and holds the corporation itself accountable and liable, while shielding the corporate officers from personal liability, except, in rare instances, for gross, personal misconduct.5 Unlike people, corporations are immortal; they can exist in perpetuity. Over time, the corporate governance model was extended to labor unions, non-profit organizations such as charities, and to special interest groups organized to promote a political point of view. While a case can be made for protecting the speech rights of some of these groups, especially those established for a political purpose, in my view, there is room for treating them as separate classes and legislating rules to govern each. (Nonsensically, some are required to disclose their sources of financing while others are not.) For more than one hundred years, the courts seem to have agreed there should be limits. The first crack in the dam appeared in the 1976 decision Buckley vs. Valeo. While it allowed limits on political contributions to stand, for the first time, the Court removed limits on expenditures, allowing an individual candidate to spend as much of his or her own money as he or she wanted6. Another case that same year was ³Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, Inc.´ This decision extended First Amendment protection to commercial speech. Other decisions that expanded corporate influence followed. (Again, I refer you to Justice Steven¶s dissent for a thorough legal analysis.) Since the word ³Corporation´ does not appear in the Constitution, you would think that the Congress would then have the power to define rules concerning corporations, as McCainFeingold gingerly attempts to do. An ³activist judge´ might think otherwise.

Unrestrained Speech

5 The most oft-sited phrase with respect to the relationship of individual officers to their corporation is ³corporate officers should not pierce the corporate veil.´ For example, if the corporation purchased a car that was then used by a corporate officer¶s spouse for personal transportation, that would be a violation. While it is obvious that this rule is routinely ignored, especially at large corporations, it is a standard that most of us would recognize as ethically and legally sound and one that a court would enforce, if challenged to do so. 6 While not debated here, I have seen the effects of a financial imbalance during a gubernatorial race here in New Hampshire. One candidate, Craig Benson (R), spent twelve million dollars or so of his own money. His opponent, Mark Fernald (D) spent less than ten percent of that. Not only did this result in a one-sided media blitz in Benson¶s favor, but the media, itself the recipient of all this campaign cash, went easy on Benson, lobbing softball questions his way, while sending the hard questions Fernald¶s way, or ignoring him completely. When there¶s a resource imbalance, media complicity is a hidden hazard. They are the silent opponents to campaign finance reform.

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CITIZENS UNITED v FEC: One Year Later
The ³absolutist´ interpretation of the Constitution and Bill of Rights subscribes to the notion that there should be no constraints on speech; to do so would have a ³chilling´ effect. Here are some exceptions few would find objectionable: y y y y y y y y y y y y y Yelling Fire in a crowded theatre Divulging troop positions to the enemy Outlawing bribery Criminalizing the solicitation for sex Conspiracy, such as planning a bank heist Communications with terrorist organizations Prohibitions against obscenity, child pornography Laws against slander Privacy protections Copyright and patent law Ordinances against Noise Non-profit 501(c)3 organizations are prohibited from participating in political activities. I¶m sure I¶ve missed a few more.

Oh, Yes. Don¶t even think of joking about having a bomb in your briefcase at the airport. The fact is the Court has recognized many restraints on speech and most of us accept these as being in the public interest. There is no such thing as absolute free speech. That the Court failed to recognize that unrestrained corporate speech is equally pernicious and deserving of restraint is where, in my opinion, justice has come off the rails. When it comes to a closer examination of free speech, the founders punted, and, tragically, the team that picked up the ball ran the wrong way. Certainly, laws that limit speech need to be debated and viewed with suspicion. But, the unrestrained speech of entities created by the states solely for commercial purposes has no place in our polity, whereas individuals who make up corporations have every right to speak and do so freely. Viewed from that vantage point, one has to wonder if this is even a legitimate First Amendment issue.

International Nature of Corporations Ignored by the Court
The largest and most powerful corporations are multinational. For example, GE, one of the largest, derives sixty percent of its revenue from overseas. There is no prohibition in the current law, or mention in the Courts decision, against non-citizens owning or controlling an American
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CITIZENS UNITED v FEC: One Year Later
corporation. No government entity is charged with determining the ³nationality´ of a corporation. It¶s not possible. Many corporations have interests that do not align with our national interests; witness the outsourcing of manufacturing jobs or their pursuit of markets in China. Multinational or not, a corporation¶s goal is maximize profits, period. Granting corporations the ability to sway elections or influence the electorate on critical national issues extends their political influence beyond what is reasonable. Yet, except for Samuel Alito¶s mouthing of ³That¶s Not True´ at the 2010 State of the Union address, the Court does not address this concern or suggest a remedy that would limit the influence of foreign-owned or controlled corporations. If you are a free speech absolutist, your response might be, ³So what? We don¶t care from where the free flow of ideas emanates ± an idea is an idea, right? Chill-out!´ Stanley Fish¶s ³consequentialist´ might disagree, especially in light of the Courts prevailing view that money is speech. Corporate money tilts the playing field; it buys elections. I also find this troubling: If the logic of the court prevails ± that a corporation is a person ± then this decision grants the corporation and the people running it each the right to speak, magnifying the voices of its officers who, incidentally, presume to speak for its stockholders. Does ³one man, one vote´ extend to ³one man, one voice´? Does a corporation officer now have one voice or two? A final thought on corporations. If I own stock in corporations (as I do through mutual funds,) I own part of that corporation. When it expresses an opinion in the political arena, does it speak for me? What gives the board or CEO of a company that right? No one asked me. As for the notion, as some have suggested, that I can always sell my shares (have you ever waded through a mutual fund report?) that reflects the never-never land in a galaxy far-far away from which this decision came.

Does Muzzling Corporations Muzzle People?
No. There are no constraints on people who run corporations. I just don¶t want to give them unlimited license to influence the outcome of elections or dominate public discourse to the extent that they do. The individual members of corporations enjoy unrestrained free speech. One respondent to Stanley Fish¶s NY Times article said it best: referring to corporations, ³«to imply that this necessary and useful entity¶s role can and should be extended to the political realm is
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CITIZENS UNITED v FEC: One Year Later
both ridiculous and injurious. Shareholders who wish to take political stands on issues can and should be able to donate their own money to politicians and political causes. Suggesting that removing the corporate vehicle from the equation somehow infringes on their rights verges on the ludicrous.´ (Comment from ³Zorro´ in Riverside, CA.) So, to those who would argue that freedom of speech is absolute, I would argue that denying a corporation¶s rights does nothing to infringe on freedom of speech, since any individual can exercise his or her free speech rights at any time.

The Court
The Supreme Courts role is to say what the law is, not to make laws. In the absence of Constitutional language governing corporate speech, laws passed by the Congress should prevail. Otherwise, it¶s the Court making policy, not the U.S. Congress. The law in question in this case was the McCain-Feingold Campaign Finance Reform Act7. This is the law that should have governed this decision. The irony is that, were it not for the composition of the present Court, dominated as it is by lawyers more sympathetic to corporate interests than to the public¶s, the prohibitions in the law against corporate meddling in political speech would have been even stronger.

What Can Be Done?
Other than initiation impeachment proceedings or waiting for the composition of the Court to change and rearguing the case, there are few realistic remedies available. But two possibilities ± admittedly remote ± are 1) an act of judicial nullification8 by the Congress and the President, or 2) a Constitutional Amendment. Good luck. There are dozens of Constitutional Amendments submitted every year that never see the light of day, including at least one on this subject submitted by former Representative Paul Hodes (D-NH). Nevertheless, it¶s fun to contemplate what one might look like; so here goes:
7 The role of the Court is also to decide ³cases´ and ³controversies´ brought before it. In this case, the Supreme Court went way beyond the controversy that was at issue. A reasonable person might question if that overreaching itself is Constitutional. 8 While I¶m sure this idea is controversial in the extreme ± a snowball¶s chance in hell ± might not Congress, relying on its powers as defined in Article III, Section 2 paragraph 2 of the Constitution, declare campaign finance or corporate governance out of judicial bounds? ³«with such Exceptions, and under such Regulations as the Congress shall make.´ Hasn¶t Congress done something like this in declaring certain terrorist decisions by the Executive out of bounds? I suppose someone with a contempt for the rule of law, like Dick Cheney, would have no trouble arguing this point, but would the Court then be able to declare the nullification itself unconstitutional?

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Resolved by the Senate and House of Representatives of the United Sates of America in Congress assembled (twothirds of each House concurring therein), that the following article, which may be cited as the ³Governance of Corporate Speech Amendment´ is proposed as an amendment to the Constitution of the United States, which shall be valid to all intents and purposes as part of the Constitution when ratified by the legislatures of three-fourths of the several States within seven years after the date of its submission for ratification: Article Section 1. a) Corporations in any form or variant are legal persons, not natural persons [Corporations are not people] and; b) The Free Speech clause of the First Amendment applies exclusively to natural persons. Section 2. The U.S. Congress is hereby empowered to regulate the activities of legal persons, including proscribing and regulating their financial activities and their political and commercial speech. Section 3. a) The rights of groups of natural persons forming a corporation for the sole purpose of disseminating political opinion or endorsements shall not be abridged, in so far as b) its membership consists exclusively of natural persons; c) its members approve pronouncements by majority vote and d) a individual member be permitted to withhold his or her financial support freely, without prejudice, and; e) its source of funding be published at intervals to be established by Congress.

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