Should corporations enjoy free speech?

By Christopher B. Daly

For no good reason, our laws (both legislative and the common-law, judge-made type) have been moving in a while in the direction of recognizing corporations as “persons” and granting them most of the benefits of being a person, while sparing them most of the downsides (like dying, paying taxes, and feeling inadequate).

The latest flash point in this development involves a petition campaign to try to use the power of government to force corporations to divulge how much the spend on political campaigns and who gets it. Such a move would limit the free-speech rights of corporations — but only to the limit already imposed on us actual living persons. As matters stand, a real live human being who donates to a political campaign has to do so knowing that the donation will be a matter of public record, available for inspection in the records of the Federal Election Commission.

But not corporations. (They’re so sensitive!) No, they are enjoying the “right” to free speech without the responsibility of disclosure. That’s why they were able to spend hundreds of millions of dollars in the last election cycle to influence our politics (translation: to elect Republicans) without having to inform anyone. That includes two very important groups:

1. The shareholders. In theory, the management of every publicly traded corporation has a legal responsibility to maximize shareholder value. Some shareholders may believe that such a duty does not extend to dropping millions of their dollars into the campaign treasuries of political candidates.

2. The customers. In theory, consumers have power that they can exercise over companies who do things they don’t like, but only if they can find out what’s going on. One reason that corporations like to exercise their free-speech “rights” in secret is so that they don’t have to face backlash and boycotts from angry consumers.

All of this can be remedied with a simple change: The Securities & Exchange Commission, the federal agency that oversees U.S. corporations, could simply require corporations to publicly disclose their political donations. That is no more onerous than what is required of you or I as an individual. In fact, the five SEC commissioners have a petition pending before them asking them to do just that. I hope that the three Democrats on the panel will find the gumption to do just that. (I have no hope that either of the two Republicans will do so).

I’m not familiar with SEC rule-making. I found this page that records comments that have already been received. I don’t see any way to comment on-line. So, I would urge you to scroll over the phrase “Type A,” print that out, and send it by snail mail to the SEC. I’m sure that if I were a corporation, I could figure this out.

For the record: I am not convinced that a corporation (a legal fiction created by the state to serve social purposes) has any rights, but I am certain that they do not have more rights than you or I.


Here’s the text of the comment in support of the petition:


The following Letter Type A, or variations thereof, was submitted by individuals or entities.

Letter Type A:

I am deeply concerned about the influence of corporate money on our electoral process.

In particular, I am appalled that, because of the Supreme Court’s ruling in Citizens United v. Federal Election Commission, publicly traded corporations can spend investor’s money on political activity in secret.

I am writing to urge the Securities and Exchange Commission to issue a rule requiring publicly traded corporations to publicly disclose all their political spending.

Both shareholders and the public must be fully informed as to how much the corporation spends on politics and which candidates are being promoted or attacked. Disclosures should be posted promptly on the SEC’s web site.

Thank you for considering my comment.

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Modified: 01/19/2012




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