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Unequal Protection

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NEW EDITION, REVISED AND UPDATED Unequal taxes, unequal accountability for crime, unequal influence, unequal control of the media, unequal access to natural resources—corporations have gained these privileges and more by exploiting their legal status as persons. How did something so illogical and unjust become the law of the land? Americans have been struggling with the role of corporations since before the birth of the republic. As Thom Hartmann shows, the Boston Tea Party was actually a protest against the British East India Company—the first modern corporation. Unequal Protection tells the astonishing story of how, after decades of sensible limits on corporate power, an offhand, off-the-record comment by a Supreme Court justice led to the Fourteenth Amendment—originally passed to grant basic rights to freed slaves—becoming the justification for granting corporations the same rights as human beings. And Hartmann proposes specific legal remedies that will finally put an end to the bizarre farce of corporate personhood. This new edition has been thoroughly updated and features Hartmann’s analysis of two recent Supreme Court cases, including Citizens United v. Federal Election Commission, which tossed out corporate campaign finance limits.

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CHAPTER 1 The Deciding Moment?

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The first thing to understand is the difference between the natural person and the fictitious person called a corporation. They differ in the purpose for which they are created, in the strength which they possess, and in the restraints under which they act.

Man is the handiwork of God and was placed upon earth to carry out a Divine purpose; the corporation is the handiwork of man and created to carry out a money-making policy.

There is comparatively little difference in the strength of men; a corporation may be one hundred, one thousand, or even one million times stronger than the average man. Man acts under the restraints of conscience, and is influenced also by a belief in a future life. A corporation has no soul and cares nothing about the hereafter....

—William Jennings Bryan, in his address to the Ohio 1912 Constitutional Convention

PART OF THE AMERICAN REVOLUTION WAS ABOUT TO BE LOST A CENTURY after it had been fought. At the time probably very few of the people involved realized that what they were about to witness could be a counterrevolution that would change life in the United States and, ultimately, the world over the course of the following century.

 

CHAPTER 2 The Corporate Conquest of America

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The legal rights of the...defendant, Loan Company, although it be a corporation, soulless and speechless, rise as high in the scales of law and justice as those of the most obscure and poverty-stricken subject of the state.

—Excerpt from the judge’s ruling in Brannan v. Schartzer, 25 Ohio Dec. 491 (1915)

WHILE CORPORATIONS CAN LIVE FOREVER, EXIST IN SEVERAL DIFFERENT places at the same time, change their identities at will, and even chop off parts of themselves or sprout new parts, the chief justice of the U.S. Supreme Court, according to its reporter, had said that they are “persons” under the Constitution, with constitutional rights and protections as accorded to human beings. Once given this key, corporations began to assert the powers that came with their newfound rights.

First Amendment. Claiming the First Amendment right of all “persons” to free speech, corporate lawsuits against the government successfully struck down laws that prevented corporations from lobbying or giving money to politicians and political candidates.1

 

CHAPTER 3 Banding Together for the Common Good

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A corporation has no rights except those given it by law. It can exercise no power except that conferred upon it by the people through legislation, and the people should be as free to withhold as to give, public interest and not private advantage being the end in view.

—William Jennings Bryan, address to the Ohio 1912 Constitutional Convention

IN THE BEGINNING, THERE WERE PEOPLE.

For thousands of years, it was popular among philosophers, theologians, and social commentators to suggest that the first humans lived as disorganized, disheveled, terrified, cold, hungry, and brutal lone-wolf beasts. But both the anthropological and archeological records prove it a lie.

Even our cousins the apes live in organized societies, and evidence of cooperative and social living is as ancient as the oldest hominid remains. For four hundred thousand years or more, even before the origin of Homo sapiens, around the world we primates have made tools, art, and jewelry and organized ourselves into various social forms, ranging from families to clans to tribes. More recently, we’ve also organized ourselves as nations and empires.1

 

CHAPTER 4 The Boston Tea Party Revealed

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They [those who wrote and signed the Declaration of Independence] meant to set up a standard maxim for free society, which would be familiar to all, and revered by all; constantly looked to, constantly labored for, and even though never perfectly attained, constantly approximated, and thereby constantly spreading and deepening the influence and augmenting the happiness and value of life to all people of all colors everywhere. The assertion that “all men are created equal” was of no practical use in effecting our separation from Great Britain; and it was placed in the Declaration not for that, but for future use. Its authors meant it to be—as, thank God, it is now proving itself—a stumbling block to all those who in after times might seek to turn a free people back into the hateful paths of despotism.

—Abraham Lincoln, speech in Springfield,
June 26, 1857, commenting on the Dred Scott decision of the U.S. Supreme Court

AS ABRAHAM LINCOLN BIOGRAPHER ALBERT J. BEVERIDGE NOTED IN 1928:

Facts when justly arranged interpret themselves. They tell the story. For this purpose a little fact is as important as what is called a big fact. The picture may be well-nigh finished, but it remains vague for want of one more fact. When that missing fact is discovered all others become clear and distinct; it is like turning a light, properly shaded, upon a painting which but a moment before was a blur in the dimness.1

 

CHAPTER 5 Jefferson versus the Corporate Aristocracy

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Let monopolies and all kinds and degrees of oppression be carefully guarded against.

—Samuel Webster, 1777

ALTHOUGH THE FIRST SHOTS WERE FIRED IN 1775 AND THE DECLARATION was signed in 1776, the war against a transnational corporation and the nation that used it to extract wealth from its colonies had just begun. These colonists, facing the biggest empire and military force in the world, fought for five more years—the war didn’t end until General Charles Cornwallis surrendered in October 1781. Even then some resistance remained; the last loyalists and the British left New York starting in April 1782, and the treaty that formally ended the war was signed in Paris in September 1783.

The first form of government, the Articles of Confederation, was written in 1777 and endorsed by the states in 1781. It was subsequently replaced by our current Constitution, as has been documented in many books. In this chapter we take a look at the visions that motivated what Alexis de Tocqueville would later call America’s experiment with democracy in a republic. One of its most conspicuous features was the lack of vast wealth or any sort of corporation that resembled the East India Company—until the early 1800s.

 

CHAPTER 6 The Early Role of Corporations in America

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An effort is being made to build a railroad from Springfield to Alton. A [corporate] charter has been granted by the legislature, and books are now open for subscriptions to the stock. The chief reliance for taking the stock must be on the eastern capitalists; yet, as an inducement to them, we, here must do something. We must stake something of our own in the enterprise, to convince them that we believe it will succeed, and to place ourselves between them and subsequent unfavorable legislation, which, it is supposed, they very much dread.

—Illinois Congressman Abraham Lincoln, addressing the leaders of Sangamon County, Illinois, June 30, 1847

JANE ANNE MORRIS IS A CORPORATE ANTHROPOLOGIST AND WRITER IN Madison, Wisconsin, and she is affiliated with the Program on Corporations, Law, and Democracy (POCLAD), one of the leading organizations doing research and work in illuminating the story of corporate personhood.

Morris discovered that on the eve of his becoming chief justice of Wisconsin’s Supreme Court, Edward G. Ryan said ominously in his 1873 address to the graduating class of the University of Wisconsin Law School,

 

CHAPTER 7 The People’s Masters

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Private capital tends to become concentrated in few hands, partly because of competition among the capitalists, and partly because technological development and the increasing division of labor encourage the formation of larger units of production at the expense of the smaller ones. The result of these developments is an oligarchy of private capital the enormous power of which cannot be effectively checked even by a democratically organized political society.

This is true since the members of legislative bodies are selected by political parties, largely financed or otherwise influenced by private capitalists who, for all practical purposes, separate the electorate from the legislature. The consequence is that the representatives of the people do not in fact sufficiently protect the interests of the underprivileged sections of the population.

Moreover, under existing conditions, private capitalists inevitably control, directly or indirectly, the main sources of information (press, radio, education). It is thus extremely difficult, and indeed in most cases quite impossible, for the individual citizen to come to objective conclusions and to make intelligent use of his political rights.

 

CHAPTER 8 Corporations Go Global

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Curtin, what do you think of those fellows in Wall Street who are gambling in gold at such a time as this?...For my part, I wish every one of them had his devilish head shot off.

—President Abraham Lincoln, personal letter to Pennsylvania Governor Andrew Curtin, April 25, 1864

PEOPLE, AT THE TIME, GENERALLY WEREN’T ALL THAT CONCERNED ABOUT the fate of the world’s dolphins.

It was the last week of June 1944, and the war wasn’t going well for Adolf Hitler. The killing machines of his death camps were running full out, straining his resources and creating consternation as word leaked out across Europe. His forces were falling back before the Soviets, and his generals openly worried about an Allied invasion on the French coast. On Thursday, June 29, almost all of the eighteen hundred Jews of Corfu were murdered upon their arrival at Auschwitz, while twenty thousand Jewish women were relocated to the concentration camp at Stutthof. On Friday, June 30, more than a thousand Parisian Jews arrived at Auschwitz.

 

CHAPTER 9 The Court Takes the Presidency

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“The election is over. We won.”

Reporter’s voice: “How do you know that?”

“It’s all over but the counting. And we’ll take care of the counting.”

—Republican Congressman Peter King on July 4, 2003, speaking of the 2004 presidential election, interviewed by filmmaker Alexandra Pelosi for the HBO documentary Diary of a Political Tourist1

ON DECEMBER 12, 2000, THE U.S. SUPREME COURT GRANTED YET ANOTHER gift to corporate power—and hammered yet another nail into the coffin of democracy in America. They did it in a strikingly dramatic fashion: by stealing the presidency.

In the process five members of the unelected third branch of government made sure that its majority character and nature probably wouldn’t change for a long enough time that the Court could cast a hugely conservative shadow over the American electoral process, guaranteeing that people like themselves and their patrons—wealthy, powerful, and corporate-connected—would continue to have a disproportionate impact on future elections.

Here’s how they did it and what their actions mean for the future of the battle between corporations and citizens for the soul of the nation.

 

CHAPTER 10 Protecting Corporate Liars

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With yearly revenues of over $9 billion, NIKE has the resources to spread their corporate message far and wide. Do they also have the Constitutionally protected right to distort or misrepresent the truth for commercial gain?

Corporations are not people, and the First Amendment should account for their unique motivation: sales.

—Congressman Dennis Kucinich, writing about the Supreme Court case Kasky v. Nike1

THE FIRST DIRECT SHOT ACROSS THE BOW OF THE DOCTRINE OF A CORPORAtion’s “right to lie” by using its “personhood” to claim First Amendment “free speech” rights came in April 1998, when Mark Kasky, a California political activist, noticed that Nike was engaged in what he considered to be a deceptive greenwashing campaign. Kasky had long been a runner and wore Nike shoes, so he was particularly distressed when he saw Nike’s communications director, Lee Weinstein, publish a letter in the San Francisco Examiner in December 1997 that said, in part, “Consider that Nike established the sporting goods industry’s first code of conduct to ensure our workers know and can exercise their rights.”2

 

CHAPTER 11 Corporate Control of Politics

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The government silences a corporate objector, and those corporations may have the most knowledge of this on the subject. Corporations have lots of knowledge about environment, transportation issues, and you are [proposing] silencing them during the election?

—U.S. Supreme Court Justice Anthony Kennedy, speaking from the bench during September 9, 2009, oral arguments in the case Citizens United v. Federal Election Commission

DURING THE BRUISING PRIMARY ELECTION SEASON OF 2008, A RIGHT-WING group put together a ninety-minute hit-job on Hillary Clinton and wanted to run it on TV stations in strategic states. The Federal Election Commission (FEC) ruled that advertisements for the “documentary” were actually “campaign ads” and thus fell under the restrictions on campaign spending of the McCain-Feingold Act and thus stopped them from airing. (Corporate contributions to campaigns have been banned repeatedly and in various ways since 1907 when Republican President Teddy Roosevelt pushed through the Tillman Act.)

 

CHAPTER 12 Unequal Uses for the Bill of Rights

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Of the cases in this court in which the Fourteenth Amendment was applied during its first fifty years after its adoption, less than one half of one percent invoked it in protection of the Negro race, and more than fifty percent asked that its benefits be extended to corporations.

—Justice Hugo Black, 1938

THE STATISTIC IN THIS CHAPTER’S EPIGRAPH IS SOBERING INDEED. IT SAYS corporations sought protection under the Fourteenth Amendment a hundred times more often than did the people it was intended to protect. And this is not a victimless shift—there have been real and substantial consequences. In the years following the Santa Clara decision and the cases that referred to it, companies have used their personhood rights in an amazing variety of ways. What follows in this chapter is a small selection.

Supreme Court Justice Oliver Wendell Holmes Jr. noted in the landmark 1919 Shenck v. United States case that shouting “Fire!” in a crowded theater does not constitute free speech; the Bill of Rights guarantees that a person’s opinion can be expressed, not that there are no limits on what one can do. But consider how this fundamental freedom has been bent by corporations since Santa Clara.

 

CHAPTER 13 Unequal Regulation

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There can be no effective control of corporations while their political activity remains.

—Theodore Roosevelt, speech, August 31, 1910

THERE’S A SIDE TO REGULATION THAT MOST PEOPLE DON’T THINK ABOUT, and it has far-reaching effects if representatives of corporations are writing the rules. Once a regulation is passed saying, “you can emit no more than 10 ppm [parts per million] of mercury,” you can legally emit up to 10 ppm. Before that rule was passed, any amount you emitted might subject you to potential lawsuits from nearby humans made ill by your emissions, by other states, or even by the federal government. The regulatory rule essentially legalizes what a corporation is doing. In the best of worlds, this wouldn’t be a problem. But in practice it means that business interests are often directly involved in writing the regulations that they themselves will have to obey.

During the Reagan administration, Robert Monks and Nell Minow worked with the Presidential Task Force on Regulatory Relief. Monks says, “We found that business representatives continually sought more rather than less regulation, particularly when [the new regulations] would limit their liability or protect them from competition.”

 

CHAPTER 14 Unequal Protection from Risk

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Corporations are neither physical nor metaphysical phenomena. They are socioeconomic ploys—legally enacted game-playing—agreed upon only between overwhelmingly powerful socioeconomic individuals and by them imposed upon human society and its all unwitting members.

—R. Buckminster Fuller, Grunch of Giants

WHEN CORPORATIONS GAINED THE PROTECTIONS THAT HAD BEEN WRITTEN for persons in the United States, a substantial shift began in who bears what risk, resulting in an imbalance that now affects virtually all parts of the world. Most companies handle risk responsibly, but many corporations are legally allowed to avoid responsibility in ways that would never be permitted for an individual.

Risk is a matter of who suffers when something goes wrong. Corporations and their shareholders may risk loss of income or even loss of their investment, but that pales in comparison with the risks that humans share as a result of a corporate activity—such as degradation of the environment, higher rates of cancer and other diseases, job-related disfigurement or death, community and family breakdown after a factory is closed and jobs are shipped overseas, and even a life with no income or health insurance if we choose not to affiliate with a corporation.

 

CHAPTER 15 Unequal Taxes

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You must pay the price if you wish to secure the blessings.

—President Andrew Jackson

IT COSTS MONEY TO RUN A GOVERNMENT, AND THE MORE YOU WANT THE GOVernment to do, the more it usually costs. One point to consider is how much do we want our government to do? Another is, who should pay for it? Tax policy is how government funds its services and also one way it fulfills the will of the people who elect it by providing tax incentives or disincentives for particular types of behaviors. Consider how home mortgage interest deductibility has fueled home buying, for example.

As we have seen, starting well before Santa Clara, some companies have worked hard to get out of paying for anything, including taxes. Some even spent years resisting paying taxes on land the government had given them for free; they then worked the issue to a ludicrous extent. The Santa Clara case involved going to the Supreme Court to fight a tax of one-tenth of 1 percent.

You and I could never afford to do such a thing, but economies of scale mean that for huge property owners such efforts can have very big paybacks. Motivated to pursue the subject, with the means to do so, and in the absence of regulations preventing it, they do the obvious thing, as Adam Smith predicted anyone would: they act in their own self-interest.

 

CHAPTER 16 Unequal Responsibility for Crimen

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A wicked big interest is necessarily more dangerous to the community than a wicked little interest.

—Teddy Roosevelt, Ohio Constitutional Convention, 1912

CONSIDER THIS AUGUST 3, 2001, WHITE HOUSE PRESS BRIEFING, IN WHICH the editor of Corporate Crime Reporter, Russell Mokhiber, asked a question of White House Press Secretary Ari Fleischer:

Mokhiber: Ari, the Federal Communications Commission requires that if you’re going to have a broadcast license you have to be of sound moral character. So when you make the application, you have to answer whether you’ve ever been convicted of a felony. They are now going after a gentleman in Missouri who’s been convicted of a felony—

Fleischer: Be careful, there are many broadcasters in this room.

Mokhiber: I understand, that’s why I’m raising the question. This gentleman was convicted of a felony, child molestation, and they’re trying to strip him of five radio licenses. On the other hand, General Electric, which owns NBC, has been convicted of felonies, and they’re not being stripped of their license. Why the double standard?

 

CHAPTER 17 Unequal Privacy

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The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated...

—Fourth Amendment to the Constitution of the United States, guaranteeing privacy from snooping

WHO READS YOUR MAIL? NOBODY? IT DEPENDS WHAT SYSTEM YOU USE FOR communication.

Paper mail that is delivered by the government-run U.S. Postal Service carries legal protections for the privacy of our communications. Nobody, at least without a court order, can read our letters or track what we send and receive.

But if you send an e-mail, the corporation that provides your Internet access can keep track of who you correspond with, what Web sites you visit, and everything you write, read, and view. Even after the terrorist attacks on the World Trade Center and the Pentagon in September 2001, the FBI needed an act of Congress to get that kind of power, even in limited form. But the corporations who transmit our e-mail have had it from day one.

And not only can multinational media corporations track our individual Internet activity, they do. If I walk around in my local bookstore, Bear Pond Books, nobody is following me and noting every book I pick up and look over. But when I browse the Web, both my Internet provider and the owners of the Web sites I visit may know who I am and what I’ve looked at. In fact, unless we intentionally install or activate security software, it’s highly likely that they do know where we’ve been. That’s because when I click on a Web site, it sends a coded signal through my Internet company and to the Web site host. Both of them can easily record my clicks—at practically no cost to themselves.

 

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