Corporations and People

People are people so why should it be
You and I should get along so awfully?
--Depeche Mode

Yesterday the Supreme Court ruled on the 'Hobby Lobby' case, saying the Obamacare's contraception mandate does not apply to 'closely held' corporations. Hobby Lobby and other corporate entities claim that it is against religious beliefs of people who own their enterprises to pay for services that support abortion. Thus, the ACA's contraception mandate violates the owners' First Amendment rights.

That the Supreme Court upheld these rights is a positive outcome, insofar as it goes, and is worthy of separate discussion.

Here, though, I wanted to discuss part of the rationale appearing in the ruling opinion written by Justice Alito.

A popular response by people who disagreed with the Citizens United ruling (2010), which held that certain parameters of statutory campaign contribution limits on corporations violated First Amendment rights of free speech, has been that 'corporations aren't people.' Because the Bill of Rights elaborate individual, not corporate, rights, the argument goes, corporations are not subject to those constitutional protections.

Those arguments are misguided. Corporations are owned by individuals. Individuals do not surrender constitutional protections when they own shares of corporations. While a corporation is not a person, it is owned by persons. Individuals who own shares of corporations possess the same inalienable rights as other people. Just as an owner's corporate share cannot be legally stolen, an owner's First Amendment rights cannot be forcibly compromised.

Alito's thoughts in his 'Holly Lobby' opinion reflect similar reasoning:

"A corporation is simply a form of organization used by people to achieve desired ends...When rights, whether constitutional or statutory, are extended to corporations, the purpose is to protect the rights of these people."

The federal government argued the 'corporations are not people' position. Hobby Lobby, as a for-profit corporation, is "separate and apart from" its individual owners. Because the corporation is not a person, they are ineligible for Bill of Rights protections designed to protect a person's "free exercise" of religion.

Nonsense, said Alito. "Corporations, 'separate and apart from' the human beings who own, run, and are employed by them, cannot do anything at all."

While there are many issues with opinion and backdrop of this case, this portion of Alito's argument was well reasoned.