« Bail and Punishment: Many Behind Bars Have Been Convicted of Nothing | Main | LLM in entrepreneurial law »

Friday, January 22, 2010

Speech, politics, and the corporate form

I don't teach or write (or, frankly, know much of anything about) corporations and business organizations. So read this in that light. But Citizens United triggers a number of corporations issues (some of which Matt already touched on).

First, it seems that there is a public and political misconception about what a corporation is. Too often, we only think of GM or IBM or other big-businesses, ignoring smaller corporations and, in particular, not-for-profit corporations, including political advocacy groups. The latter serve, at least in part, as a means for individuals to aggregate their voices (and the resources they can expend on expression) and thus the reach and power of their message; de Tocqueville recognized the importance of voluntary associations as an integral part of American society. Thus the phrase "corporate special interests" that routinely gets thrown around becomes another empty political epithet. GM, Disney, Delmar Contracting, Inc. (they just redid my kitchen), the ACLU, and WRTL all are corporations with political interests--I hardly would group them together. Obviously the target of campaign finance reform is GM; but you cannot necessarily regulate it without regulating other corporate speakers.

Second, the floodgates concerns that many (especially President Obama and congressional Democrats) have been raising seem misplaced. The Court left in place the basic distinction between independent expenditures and contributions and the latter are still more limited than the former, although mitigated by "soft money" to political parties. So this case is not going to create some new level of corporations buying politicians--the connection is not necessarily there between the corporation and the candidate. It will create a new level of corporate-funded ads, movies, and other speech--but that does not strike me as a bad thing. In any event, corporations already get into bed because candidates are so dependent on contributions which, though limited, are still substantial in amount. Citizens United did not make that situation better or worse.

Third, going off something Matt argued: Are businesses (especially large GM/Disney/Eli Lilly types) going to engage in candidate electioneering (as opposed to issue advertising)? I can see Eli Lilly spending money to stop health-care reform (which is in its business interests); I cannot see it spending money regularly to elect anti-reform candidates in multiple congressional races. Especially in the face of objections from shareholders.

Posted by Howard Wasserman on January 22, 2010 at 03:23 PM in First Amendment, Howard Wasserman, Law and Politics | Permalink

TrackBack

TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00d8341c6a7953ef0120a7fe8bc4970b

Listed below are links to weblogs that reference Speech, politics, and the corporate form:

Comments

I don't understand why you are so optimistic about shareholder revolts.
Buying politicians is a FANTASTIC return on money. (look at what a few million dollars to Grassley did for the Insurance companies)

Now it will be even easier to buy state a local politicians and get "better" regulations or protection for your company (meaning greater profits and share prices)

Posted by: D-man | Jan 22, 2010 3:40:26 PM

I've noticed a number of similar posts to yours on several legal blogs. I'm perplexed at the notion that this case is somehow neutral. I have a completely different view of what is likely to happen. It is more than a campaign finance issue; it is a corporate power issue. I posted on it today at www.intheeyesofthelaw.com.

Posted by: Kimberly Houser | Jan 22, 2010 3:43:41 PM

I guess what I'm asking regarding your shareholders point is whether you don't think that there are large profits to be made by influencing politicians to make regulations in your company's favor instead of against your company...

or if you don't think that shareholders realize that it is profitable

Posted by: D-man | Jan 22, 2010 4:19:54 PM

Howard,

I agree strongly with your first two points. The hysteria that has attended this decision has entirely precluded critics from thinking carefully about exactly whom they wish to stifle, and how that "whom" differs meaningfully from other organizations and wealthy individuals.

I'm less certain abut your final point. I agree that companies will probably wish to tread carefully. But it seems to me - and this is another reason why I cannot understand the recent hysteria - that companies are already navigating this terrain with respect to lobbying expenditures, industry organizations, and corporate involvement in PACs ("encouraging" employees to donate). I don't imagine many shareholders will organize to object to further participation because the companies probably know what they're doing: hedge bets, but favor the guy who agrees with you.

Posted by: Adam Scales | Jan 23, 2010 1:43:40 PM

Post a comment