January 28, 2005
Is Wal-Mart a Person? Thom Hartmann Tells Why It Is--Kind of--But Not Really
A BUZZFLASH INTERVIEW
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Let's start with the basic premise of Unequal
Protection. In essence, what is "corporate personhood"
in terms of current American law?
Prior to the founding of this nation, with the exception of a brief period in Greece, the history of the previous 7000 years of what we called "civilization" was that one of three types of rulers were the sole holders of rights. Society was ruled by either warlord kings; theocratic popes, mullahs or variations thereof; or the very rich. And they ruled both by virtue of their personal wealth, power, or knowledge of a god's will, and because they represented a ruling institution (the kingdom, church, or either land or a corporation).
Largely through the power of their institutions, they were the sole holders of "rights," and all the non-institutional humans -- the serfs, common people, and even the very tiny precursor of the middle class, the mercantilists and guildsmen -- had only "privileges," which could be revoked more-or-less at will by the holders of the rights.
The extraordinary experiment that was the basis of American democracy in a constitutionally limited republic was to flip this pyramid upside down. The Founders of this republic said in the Declaration of Independence, and the Framers of the Constitution proclaimed in the preamble to the Constitution, that humans -- "all men" to quote the Declaration, "We the People" to quote the Constitution -- were the sole holders of rights from that point forward.
This was firmly nailed into the Constitution by the addition of the Bill of Rights, which gave humans a huge club they could use to beat back government if it ever were to become oppressive.
Thus, with the founding of America, for the first time, only humans could hold rights. Institutions -- churches, civic groups, corporations, clubs, even government itself -- held only privileges. Of course, you'd want government -- that is, We the People through our elected representatives -- to control the privileges of institutions like corporations. And that's what we did. For example, to prevent kingdom-like accumulations of wealth that could, as Jefferson noted, "threaten the state" itself, corporations in the first hundred or so years of this nation couldn't exist longer than 40 years, and then had to be dissolved. Their first purpose had to be to serve the public, and their second purpose to make money. Their books and all their activities had to be fully open and available to inspection by We the People. Their officers and directors could be held personally liable for crimes committed by the corporation.
This held as a legal doctrine until the end of the 1800s, and even after that largely held until the Reagan Revolution, when corporations began reaching back to an obscure headnote written by a corrupt Supreme Court clerk in an otherwise obscure railroad tax case in 1886.
But today corporations are asserting that they -- and only they -- should stand side-by-side with humans in having access to the Bill of Rights. Nike asserted before the Supreme Court last year, as Sinclair Broadcasting did in a press release last month, that these corporations have First Amendment rights of free speech. Dow Chemical in a case it took to the Supreme Court asserted it has Fourth Amendment privacy rights and could refuse to allow the EPA to do surprise inspections of its facilities. J.C. Penney asserted before the Supreme Court that it had a Fourteenth Amendment right to be free from discrimination -- the Fourteenth Amendment was passed to free the slaves after the Civil War -- and that communities that were trying to keep out chain stores were practicing illegal discrimination. Tobacco and asbestos companies asserted that they had Fifth Amendment rights to keep secret what they knew about the dangers of their products. With the exception of the Nike case, all of these attempts to obtain human rights for corporations were successful, and now they wield this huge club against government that was meant to protect relatively helpless and fragile human beings.
overturn some interesting misconceptions about the Boston Tea Party. Can
you explain what the Boston Tea Party was really about and what it shows
about the revolutionaries' attitudes toward large multinational commercial
enterprises that were intertwined with the British government?
It wasn't called the Boston Tea Party until
the 1830s, after Jefferson had died. Anyhow, I wanted to know more about
it, so I went off in search of a good book on the topic.
In this book, Hewes, who was a teenager at the time of the Tea Party (which he named in 1834), tells that the whole point of this million-dollar (in today's terms) act of vandalism was to protest a tax cut -- a corporate tax break -- that the British had given to the East India Company, which would allow it to unfairly compete with and wipe out the thousands of small entrepreneurial tea importers and tea shops that dotted the colonies.
I'd thought I remembered from school that the Tea Act of 1773 was a tax increase, so I had to check the Encyclopedia Britannica, which, sure enough, said that the Tea Act was a tax cut. So what the colonists were protesting was the principle of taxation without representation, but what they meant was what today would be termed "tax breaks for multinational corporations while the average person gets screwed."
Anyhow, I was so transfixed by Hewes' account, which had remained hidden since 1834 -- the book was apparently published by a little local press in his hometown -- that I reprinted a good chunk of it, which is still eminently and brilliantly readable, in Unequal Protection.
As Hewes noted:
It was a real shock to me to discover that
the event that kicked over the first domino leading directly to the American
Revolution was a direct-action protest against multinational corporate
power, and that discovery, along with the really incredible discovery
I made when I read that 1886 tax case that supposedly gave corporations
human rights, led me to change the scope and title of the book from one
about Jefferson -- I later wrote that one -- and instead into a book about
the history of corporate power in America.
But government fought back. When Santa Clara County sued the Southern Pacific Railroad, that was the beginning of the end. It was actually a tax case, about whether the railroad had to pay property tax on the fence posts it owned along the right-of-way of its railroad through Santa Clara County, on the terms of the County's assessor or the State of California's assessor. The railroad argued that by having different tax rates in different states, they were being discriminated against under the 14th Amendment. This was, by the way, an argument the railroads had brought before the Supreme Court many times. It had always previously been rebuffed, sometimes in strong terms.
For example, in 1873, one of the first Supreme
Court rulings on the Fourteenth Amendment, which had passed only five
years earlier, Justice Samuel F. Miller minced no words in chastising
the railroads for trying to claim the rights of human beings.
But in the 1886 case, we are told by over a hundred years' worth of history books and law books, the Supreme Court decided that corporations were, in fact, persons, and entitled to human rights, including the right of equal protection under the law -- freedom from discrimination.
What was really amazing to me was that when I went down to the old Vermont State Supreme Court law library here in Vermont, and read an original copy of the Court's proceedings in the 1886 "Santa Clara County v. Southern Pacific Railroad" case, the Justices actually said no such thing. In fact, the decision says, at its end, that because they could find a California state law that covered the case "it is not necessary to consider any other questions" such as the constitutionality of the railroad's claim to personhood.
But in the headnote to the case -- a commentary written by the clerk, which is NOT legally binding, it's just a commentary to help out law students and whatnot, summarizing the case -- the Court's clerk wrote: "The defendant Corporations are persons within the intent of the clause in section 1 of the Fourteenth Amendment to the Constitution of the United States, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws."
That discovery -- that we'd been operating for over 100 years on an incorrect headnote -- led me to discover that the clerk, J.C. Bancroft Davis, was a former corrupt official of the U.S. Grant administration and the former president of a railroad, and in collusion with another corrupt Supreme Court Justice, Stephen Field, who had been told by the railroads that if they'd help him get this through they'd sponsor him for the presidency.
I later discovered that the folks who run
POCLAD -- the Program on Corporations, Law, and Democracy -- had already
figured this out, and that there had been an obscure article written about
it in the 1960s in the Vanderbilt Law Review, but it was, for me, like
running down a detective mystery. So that was when the foundations for
corporate power were laid in the United States, and they were laid on
the basis of a lie.
The business of America, according to most of the founders (Hamilton probably would have disagreed), was human rights for humans, democracy, and limits on BOTH government power and ALL other forms of institutional power, from church power to corporate power.
A corporation today can have an infinite lifespan. It doesn't fear death. It doesn't fear pain or incarceration. It doesn't need fresh water to drink or clean air to breathe. It doesn't need health care or retirement. It can own others of its own kind. It can change citizenship in a day. It can tear off a part of itself and create a new corporation in an hour. It can amass virtually infinite wealth without that wealth ever having to pass through probate or being subject to estate/inheritance taxes.
This is exactly why the Founders, Framers, and early state governments explicitly limited corporate power. And as corporations rose in power, after having corrupted the Supreme Court and then the Congress, and then the Presidency (starting, big time, with Grant), this is why American Presidents began sounding alarm bells.
President Thomas Jefferson said, "I hope we shall crush in its birth the aristocracy of our moneyed corporations which dare already to challenge our government in a trial of strength, and bid defiance to the laws of our country." Jefferson even went so far as to suggest that banning monopolies in commerce should be written into the Bill of Rights. In 1787 when James Madison sent the first draft of the new Constitution to him, Jefferson noted in a letter that he would "insist on annexing a bill of rights to the new Constitution, i.e. a bill wherein the Government shall declare that, 1. Religion shall be free; 2. Printing presses free; 3. Trials by jury preserved in all cases; 4. No monopolies in commerce; 5. No standing army."
President James Madison said, "There is an evil which ought to be guarded against in the indefinite accumulation of property from the capacity of holding it in perpetuity by…corporations. The power of all corporations ought to be limited in this respect. The growing wealth acquired by them never fails to be a source of abuses."
President Andrew Jackson said, "In this point of the case the question is distinctly presented whether the people of the United States are to govern through representatives chosen by their unbiased suffrages or whether the money and power of a great corporation are to be secretly exerted to influence their judgment and control their decisions."
President Martin Van Buren said, "I am more than ever convinced of the dangers to which the free and unbiased exercise of political opinion -- the only sure foundation and safeguard of republican government -- would be exposed by any further increase of the already overgrown influence of corporate authorities."
President Grover Cleveland, after the Santa Clara County case was decided, said, "As we view the achievements of aggregated capital, we discover the existence of trusts, combinations, and monopolies, while the citizen is struggling far in the rear or is trampled to death beneath an iron heel. Corporations, which should be the carefully restrained creatures of the law and the servants of the people, are fast becoming the people's masters."
President Theodore Roosevelt said, "I again recommend a law prohibiting all corporations from contributing to the campaign expenses of any party.… Let individuals contribute as they desire; but let us prohibit in effective fashion all corporations from making contributions for any political purpose, directly or indirectly." Teddy Roosevelt added, "The fortunes amassed through corporate organization are now so large, and vest such power in those that wield them, as to make it a matter of necessity to give to the sovereign -- that is, to the Government, which represents the people as a whole -- some effective power of supervision over their corporate use. In order to insure a healthy social and industrial life, every big corporation should be held responsible by, and be accountable to, some sovereign strong enough to control its conduct." And in April of 1906, Teddy Roosevelt went even further, saying, "Behind the ostensible government sits enthroned an invisible government owing no allegiance and acknowledging no responsibility to the people. To destroy this invisible government, to befoul the unholy alliance between corrupt business and corrupt politics is the first task of the statesmanship of the day."
Theodore Roosevelt could have been speaking for the Founders when he said, "We stand for the rights of property, but we stand even more for the rights of man. …We will protect the rights of the wealthy man, but we maintain that he holds his wealth subject to the general right of the community to regulate its business use as the public welfare requires."
Franklin Roosevelt talked about the corporate "royalty" that had resulted from the changes in corporate law in the late 1800s, adding:
Dwight D. Eisenhower said, "In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist. We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted."
It's not like this battle between democracy
and the cancer of corporate personhood has happened in secret. Presidents
and patriots have been warning us of it -- loudly -- since the very creation
of our nation.
As I mentioned earlier, corporations like Sinclair Broadcasting are asserting their supposed rights as persons, their rights under the Bill of Rights, to fight back against citizens and government efforts to constrain them or force them to serve the public interest before serving themselves.
Ultimately, this is neither good for the media -- which is being increasingly discredited -- nor is it good for our republic and the idea of democracy, which requires an educated and informed citizenry to operate properly. When, for example, about 70 percent of the people who voted for Bush did so because, in part, they thought that Iraq and Hussein had something to do with 9/11 and that weapons of mass destruction were found in that nation -- when neither of these things is true -- speaks volumes to the terrible job the corporate media is doing in fulfilling any obligation to inform Americans.
Over the short term, this works to the profit of media corporations who are embraced by politicians like Bush, and who then return to Bush both approbation and contributions which work to his benefit. But over the long term, if unchecked, it could mean the death of democracy in America.
Of all the forms of concentrated corporate
power in America that are harming our citizens, concentrated corporate
media power is the most pernicious, for this simple reason.
Corporations, by their form, have no social conscience. Because their first obligation is -- by law -- to enhance profit, they are not committed to a community or a nation, or even to the basic humanity of the rest of us. And they can't be held to account by threat of the loss of freedom, as can humans.
This type of situation demonstrates the absurdity of corporate personhood. As Delphin M. Delmas, the man who argued Santa Clara County's side of that case against the Southern Pacific Railroad before the Supreme Court said in his arguments:
The Fourteenth Amendment, Delmas said, was written to free human beings, not corporations.
Delmas, whose other legacy is that he single-handedly
(and without a fee) saved California's last redwood forests, made a brilliant
argument before the Supreme Court. And, in the ultimate irony, the Court
agreed with Delmas, but today we ignore the ruling itself and instead
rely on a non-legal headnote that was published two years later, just
after the Chief Justice had died and could no longer refute it.
It's interesting that in one of the most recent cases decided by the Supreme Court expanding corporate personhood, Chief Justice Rehnquist dissented. The case was First National Bank of Boston versus Bellotti, in 1978, and the bank was asserting that, as a "person," it had the right of "free speech" to interfere in politics. This was the case that kicked wide the door to corporations corrupting our political process in the last twenty-five years, and has led directly to the corporate capture and manipulation of Reagan, Bush Sr., Clinton, and Dubya as well as the majority of both houses of Congress, the Republican Party, and the DLC wing of the Democratic Party.
In opening his dissent, Rehnquist said: "This Court decided at an early date, with neither argument nor discussion, that a business corporation is a "person" entitled to the protection of the Equal Protection Clause of the Fourteenth Amendment. Santa Clara County v. Southern Pacific R. Co., 118 U.S. 394, 396 (1886)."
This makes it pretty clear that neither Rehnquist nor his clerks actually read the Santa Clara case, but, as has been done for over a hundred years, were relying on the headnote. But, to his credit, Rehnquist disagreed with the headnote, saying:
Rehnquist then added, brilliantly in my opinion:
In this dissent, Rehnquist demonstrated the
difference between a classical conservative, as he is, and the new corporatists
who call themselves conservatives. Interestingly, this interview would
probably be just as interesting and agreeable to readers of the website
of William F. Buckley Jr. as it is to the readers of BuzzFlash. This is
an issue on which both classic conservatives and classic liberals agree.
The breakup of AT&T was the last significant enforcement of the Sherman Anti-Trust Act, pushed back in the late 1970s. The result was an explosion of innovation as both the research division of AT&T and the "Baby Bells" became relatively autonomous. It paved the way for competition in the industry, dramatically lowered prices for consumers, and, interestingly, over a relatively short period of time actually increased shareholder value for former AT&T stockholders.
There are only a handful -- probably fewer
than five hundred -- corporations that abuse or assert corporate personhood
in the United States. Yet the harm they do to our economy and our republic
is enormous. If they were denied personhood, we could root corruption
out of government, get corporations out of politics, and make America
safe and hospitable for entrepreneurs and small- and medium-sized businesses
again, leading to an explosion in economic activity. And both the stockholders
and the employees of these mega-corporations would benefit -- along with
the rest of us -- if they were broken back down in size to where they
were before the merger mania that Reagan allowed.
Yet I still believe that we can return America to the ideals of democracy on which it was founded. I believe that because it's burned into our DNA as Americans. Even though we haven't always been true to the ideals of our founding, we've always held those ideals high. And I believe that as more and more Americans find out about this issue -- and the movement to revoke corporate personhood is growing rapidly -- we will rise up and take back our nation.
There are some really great groups working on this, and working on it very hard. There's www.reclaimdemocracy.org, www.celdf.org, www.poclad.org, www.wilpf.org, and www.thealliancefordemocracy.org. There's a pile of information on this topic on my website at http://www.thomhartmann.com/.
Plug "corporate personhood" into a search engine and you'll see that there's a broad movement to roll it back, and this movement is accomplishing many very important goals -- such as over 100 communities in Pennsylvania that have now, with the help of the Community Environmental Legal Defense Fund, passed laws saying that they won't recognize corporations as persons. There are movements in states from Vermont to California to pass resolutions denying corporate personhood. So I have great hope and I'm not willing to lose faith in my ideals, or those of my nation. Because, in spite of everything, I agree with Anne Frank that people -- real, human persons -- are good at heart.
BuzzFlash: Thank you for bringing the issue to us.
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Unequal protection: The Rise of Corporate Dominance and the Theft of Human Rights, by Thom Hartmann (A BuzzFlash Premium)
Thom Hartmann bio: http://www.thomhartmann.com/showbio.shtml