« Two small thoughts on Citizens United | Main | Bail and Punishment: Many Behind Bars Have Been Convicted of Nothing »

Friday, January 22, 2010

Further thoughts on Citizens United

My first significant scholarly work (a senior-research paper, the writing of which convinced me, three weeks before graduation, I wanted to be an academic), published (as co-author) 12 years ago, argued all the ways that Austin was wrong and thoroughly inconsistent with important free-expression principles. So I was delighted, as a matter of First Amendment principle, that the Court finally dumped this precedent.

Some random thoughts.

1) I am not surprised the opinion fell to Justice Kennedy. He wrote a vigorous dissent in Austin itself, so there is some degree of vindication to write the opinion burying it. This also is one of the areas in which Kennedy's First Amendment passions come to the surface.

2) This opinion is broader than his Austin dissent. In the prior case, Kennedy seemed to keep his focus on the effect of a corporation-expenditure ban on non-profit corporations (such as the Chamber of Commerce)--it was Justice Scalia (also dissenting) who went on about the expressive rights of GM. He did some of that in Citizens--emphasizing that most corporations are small corporations and talking a great deal about nonprofit associations. But Kennedy more expressly owned that large corporations, many of which had amassed wealth in the market by virtue of the corporate form, would be able to spend money on speech. He (rightly so, in my view) did not believe it made a difference. He spoke of the potential effects of bans on (for-profit) media companies and the incoherence of a carve-out. And he spoke of corporate democracy as the response to the shareholder-protection argument. And he expressly and strongly rejected the equality/leveling argument that really is what Austin was about (although Austin called it corruption-by-distortion).

3) I am not necessarily bothered by the majority seemingly reaching out to overrule Austin. Of course, I am not a judicial minimalist and do not pretend to be one. And I never have entirely believed that Chief Justice Roberts is one, either. Kennedy did play a bit loose with some of the possible statutory arguments, particularly in treating a 90-minute historical documentary as the functional equivalent of express advocacy for or against a candidate. But the movie does contain enough voice-overs and commentary linking Clinton's past to the specific point of her qualification to be President that calling this a "feature-length negative advertisement" is accurate. I do see the merits to the argument made that the statutory arguments here would have been no less strained than the arguments in last term's Voting Rights Act case.

4) One part of the opinion that might have broad effect is the strong language Kennedy uses to establish the premise that restricting expression because of speaker identity (in this case, corporations) is as constitutionally problematic as restricting expression because of what was said. This has been implicit in many cases, but Kennedy makes explicit (I think for the first time, since he does not cite anything for the proposition) that "restrictions based on the identity of the speaker are all too often simply a means to control content" and the "First Amendment protects speech and speaker, and the ideas that flow from each." Underlying this is the necessary conclusion that the identity of the speaker affects the message, that content of speech takes into account speaker--the speech of a corporate PAC is not the speech of the corporation; and restricting the speech of only one raises First Amendment problems, the message of each is different.

5) Matt makes a few important points on the labor/corporations side of things that I want to latch on to.

5a) First, I found interesting Fisch's argument that corporate political activity is an important part of business activity. I had considered (but ultimately did not make) the argument that the so-called corporate social-responsibility movement should have opened the door to acceptance of broader corporate speech. After all, if we demand that corporations behave in a socially responsible way, corporations should have the liberty to engage in public debate and thus to influence what we mean by social responsibility. But the connection between corporate political speech and corporate business always has seemed obvious to me.

5b) We made the shareholder-control argument in the article. I think the notion of shareholders stepping forward in advance may allow them to wield more power than Justice Stevens suggests they can.

5c) Matt predicts that corporations seen as more ideological may run into some shareholder problems, while corporations that play both sides, quietly, will not. But I wonder whether we also will see some corporations become even more explicitly ideological in their expression, specifically to attract shareholders (not just customers) who share and want to support that ideology and speech in support of that ideology.

5c) The union situation could be interesting. Matt argues that unions benefit from engaging in political speech, just as corporations do. And today's decision frees unions, as much as businesses and the Chamber of Commerce, to spend general funds for electioneering speech, without having to funnel through a PAC. But one anomaly remains that makes corporations free in a way that unions are not. Union dues-payers (and maybe even some union members--I'm not sure) still possess their own First Amendment rights to opt-out of having their dues fund certain not-germaine-to-union-purpose expression, a constitutional right not enjoyed by corporate shareholders (who are not compelled to invest). Thus, as a practical matter, unions still must maintain segregated funds for certain expression, while corporations can run everything through the general treasury. At the very least, unions must create mechanisms for opt-outs, decreasing the money they can collect and use. I wonder if Congress or a state might level the playing field by giving shareholders similar opt-out rights as those enjoyed by union dues-payers and members.

Posted by Howard Wasserman on January 22, 2010 at 08:15 AM in Constitutional thoughts, Current Affairs, First Amendment, Howard Wasserman, Law and Politics | Permalink


TrackBack URL for this entry:

Listed below are links to weblogs that reference Further thoughts on Citizens United:


Thanks for your reply, which makes eminent sense if corporations have the same status as any other "someone." I start from the ontological distinction I mentioned. On that basis, I can accept that in some cases self-interest might be disqualifying for corporate speech. I particularly consider the large resources at the disposal of many corporations and the dangers of their being deployed in furtherance of that self-interest (on behalf of management or shareholders, who may even be non-citizens). Even the smallest Global 500 company has revenues larger than the GDPs of multiple countries. (If I correctly recall checking two or three years ago, #500 had revenues bigger than the GDP of about 90 countries, roughly half those on earth.) I think it reasonable that this disproportionate power weigh against putting corporations on the same footing as individual citizens. Of course, rich individuals may also have staggeringly huge resources at their disposal, and may be no less self-interested than the worst-acting corporation. But since they're natural persons and citizens, I can accept that they should have the same liberties as any other such. Probably our differing views about the fundamental status of corporations will make it hard for us to reconcile our views of the Citizens United decision. We might also differ about whether the power imbalance between large corporations and citizens is another elephant in the room that we're supposed to ignore in discourse of this type, just as in neoclassical economics.

Posted by: A.J. Sutter | Jan 25, 2010 11:43:28 AM

I don't agree that adding another voice (self-interested, but clearly identified) to the public dialogue is bad for public discourse. Unless one starts from the presumption that large corporations are always bad actors, it seems unfair to say they "most often . . . try to confuse citizens," any more than any other speaker trying to put forward his/her/its best position in public debate is trying to confuse people. Self-interest never is treated as disqualifying someone from speaking, so it shouldn't disqualify corporations.

Posted by: Howard Wasserman | Jan 24, 2010 9:21:04 AM

It's striking how much more deference there is in the discourse about corporate free speech to the interests of shareholders than to the public interest. As a practical matter, participation in "corporate democracy" is not open to all citizens. I agree with you that Jill Fisch's point seems obvious; but it's precisely in furtherance of their business objectives that large corporations tend most often to try to confuse citizens. To the extent the Citizens United decision will encourage them in that attempt, it's bad for the public interest.

As for rejecting the argument about corporate social responsibility, doing so was probably a good intuition. Citizens and corporations don't have the same ontological status. Corporations are creatures of statute, and therefore could be said to exist at the sufferance of citizens. So your inference that "if we demand that corporations behave in a socially responsible way, corporations should have the liberty to engage in public debate" doesn't automatically follow.

Posted by: A.J. Sutter | Jan 24, 2010 4:06:36 AM


Interesting. I may take this on in a longer post, but your proposal is a good starting point. I definitely agree that the First Amendment requires an opt-out--that is, the corporation can make use treasury funds to speak *unless* the shareholders vote otherwise.

Posted by: Howard Wasserman | Jan 22, 2010 7:46:51 PM

Seems to me under the "web of contracts" theory of corporations, even now a corporate charter could provide that the corporation is not empowered to spend money on political contributions. That wouldn't be a government restriction on speech; it would be the shareholders agreeing how to spend their money.

So there really only need be a small change in the corporate codes to accommodate this. Either the statute says that unless otherwise provided the corporation may make political contributions, or it says that unless otherwise provided the corporation may not make political contributions. In either case, the statute is simply providing a default rule among the shareholders, which can be changed by agreement. And in either case, it's consistent with what I understand the court to be saying about the "human" constituencies within the corporate structure.

Finally, of the two default rules, I think the one that says the corporation CAN make political contributions unless otherwise agreed stands a better chance of avoiding being unconstitutional as applied. That is, existing charters would have to be amended by shareholder vote to remove the right to make the contributions, and again, the limitation would be by private agreement and not by the operation of a law that restricts speech.

Posted by: Jeff Lipshaw | Jan 22, 2010 6:44:35 PM

Andrew: I am still thinking that through and will write more on it later (if I can figure it out).

Kevin: Nice catch. It may be that the language you quote can be used to undercut an effort to defend a statute that distinguishes among speakers on the ground that some content or viewpoint (speech about "X" or speech supporting "X") still can be heard by other speakers, so the law is OK. This new language says the differential treatment of the speaker is a distinct First Amendment problem. Now, as I said in my post, my argument for why "speaker matters" is that speaker identity affects content and viewpoint--the message changes with the messenger. So it is not enough that other people can speak in support of "X"; I have to be able to speak in support of X as well, because my message in support of X (given my identity) is different from someone else's message in support of X.

Posted by: Howard Wasserman | Jan 22, 2010 2:44:54 PM

Anyone have any thoughts on whether tighter incorporation statutes that are more explicit about the type of activities a corporation might engage in (and which categorically exclude electioneering) would pass constitutional muster after yesterday's decision?

Posted by: Andrew Siegel | Jan 22, 2010 2:27:46 PM

I was struck by the language that appears in the opinion between the two portions quoted above: "Quite apart from the purpose or effect of regulating content , moreover, the Government may commit a constitutional wrong when by law it identifies certain preferred speakers" (emphasis added). The typical line of attack in challenging a statute that treats speakers differently is to use the differential treatment to support an inference of content or viewpoint discrimination. This language seems to enable another line of attack, but what is the best way to develop such an attack "apart from the purpose or effect of regulating content"?

Posted by: Kevin C. Walsh | Jan 22, 2010 2:20:49 PM

I agree that Nike should not have been a commercial speech case because the expression there was not commercial--it was on a social issue, as Lyrissa says. Just as an individual can engage in both commercial and non-commercial speech, so can a corporation. The point, I guess, is that government cannot restrict speech by content *or* by speaker, without potentially having to overcome strict scrutiny.

Posted by: Howard Wasserman | Jan 22, 2010 1:01:33 PM

If speaker identity cannot determine the level of First Amendment protection for speech, what are the implications for a commercial speech case like Nike v. Kasky? In determining whether speech is "commercial" for purposes of First Amendment analysis, are we now forbidden from considering that Nike is speaking on a social issue in order to further its own commercial self-interest? [Frankly, if I were the judge, I would not have treated Nike v. Kasky as a commercial speech case because of this very issue.]

Posted by: Lyrissa | Jan 22, 2010 12:23:50 PM

The comments to this entry are closed.