The Problems With the “People’s Rights Amendment”
Corporate personhood is one of the most badly misunderstood concepts in discussions of corporate behaviour and responsibility. It is also one of the most essential tools for promoting human wellbeing and protecting individual human liberties.
People get angry — understandably and often justifiably angry — when they see instances in which corporations have too much power. But the response, the way such anger is directed, is not always constructive. Indeed, sometimes it’s downright counterproductive.
Witness, for example, the recent move in the US to propose a “People’s Rights Amendment.” (It’s a project of citizens group “Free Speech for People”, and the bill was introduced in congress by Congressman Jim McGovern of Massachusetts.) This is a hail-Mary attempt to amend the US Constitution, largely in response to the US Supreme Courth’s controversial Citizens United decision. That decision, rooted in constitutional arguments about free speech, removed certain limits on corporate political donations. Like many people, I worry about the effects of that decision; but I worry even more about the potentially disastrous effects of the proposed remedies.
Now, a lot of people believe that the US Supreme Court, in the Citizens United decision, invented the notion of Corporate Personhood. That belief is both false and wildly US-centric. But aside from getting history wrong, this belief has resulted in a backlash that has included some wrong-headed proposals for shifting the balance of power back to The People. And the People’s Rights Amendment is one of those.
Here are the 3 sections of the proposed “People’s Rights Amendment”:
Section 1. We the people who ordain and establish this Constitution intend the rights protected by this Constitution to be the rights of natural persons.
Section 2. People, person, or persons as used in this Constitution does not include corporations, limited liability companies or other corporate entities established by the laws of any state, the United States, or any foreign state, and such corporate entities are subject to such regulation as the people, through their elected state and federal representatives, deem reasonable and are otherwise consistent with the powers of Congress and the States under this Constitution.
Section 3. Nothing contained herein shall be construed to limit the people’s rights of freedom of speech, freedom of the press, free exercise of religion, and such other rights of the people, which rights are inalienable.
There are two problems here, and they are rooted in Sections 2 and 3 respectively.
Note that Section 2 says that incorporated entities don’t get constitutional rights at all. So that means, for example, no 4th Amendment limits on search and seizure of corporate property. So, under this proposed Amendment, no one’s investments — not your stock portfolio, not your RRSP, not your pension plan — is immune from arbitrary seizure by the state. It also means that a corporation would have no right to due process when charged with a crime. The implications for shareholders and employees, here, are potentially disastrous. Under the People’s Rights Amendment, any corporation you’ve invested in, or where you work, could effectively be seized and shut down without cause, without trial, without explanation. This surely limits corporate power, but at enormous cost — namely an enormous increase in the power of the state. Not the people; the state.
I should also add that this Amendment seems also to apply also to unions, nonprofits, and churches. None of them would, under the People’s Rights Amendment, retain these rights against the state, and all would be enormously vulnerable.
But all of that only matters if Section 3 doesn’t exist, because Section 3, if taken seriously, guts the whole thing. Section 3 reasserts that people, human beings, do have rights, and that nothing in Section 2 can be construed as limiting those rights. So as the owner of a corporation, or as a shareholder in one, Section 3 assures you that your property — including presumably the property of the corporation you own, or the property of the corporation from which you derive dividends — cannot be subject to unreasonable search and seizure, and cannot be confiscated without due process. Whew!
The point here is that people, real flesh-and-blood people, rely on business corporations and other ‘corporate entities’ in a huge number of ways. They are how we make our living. They are the instruments of our collective success. Where the power of those instruments needs to be limited, as it surely sometimes does, it cannot be done by pulling the rug out from under individual, human liberties. And so if corporate power is to be reined in, it will have to be done through a mechanism considerably less clumsy than the People’s Rights Amendment.
The Business Ethics Blog 
Thanks for helping educate us, Chris. Once an opponent of Corporate Personhood, Ive realized A, how naive that position is, and B, just how much a sticky-wicket Corporate Personhood really is. People are reactionary based on incomplete knowledge or mere ignorance and have little patience to separate fact from myth or to consider downstream effects of choices made in haste today, tomorrow.
The problems with the “people’s rights amendment”. Although the people’s rights amendment is to do with American’s civil rights, or constitutional rights if you would prefer, it also has to do with us in New Zealand as our bill of rights give us the same and some similar rights of those that Americans have. As corporations and businesses does business worldwide and in some cases have branches in different countries, American and New Zealand businesses can relate in some practises and that of how they conduct their business are closely connected. Businesses also have rights that apply to them all and their conduct with their customers and the environment. To fix the ideals in the people’s rights amendment has brought to light we need to look into the government and the rules and regulations that they have imposed on business and businesses codes of ethics.
In the blog ‘the problems with the people’s rights amendment’ states that “people get angry when they see instances in which corporations have too much power” and “the anger is not always constructive, sometimes it’s downright counterproductive” this is because human beings feel that the corporation is taking advantage of them due to the liberties that the governments have given the corporations. Corporations and business in general have a different set of rules to which they conduct themselves and to some people this contradicts the people’s rights. The more power that corporations gain the more strongly people feel about them and their practises. Corporations need to be held accountable for their actions, regardless of the situation. If you take away corporations rights then you take away their responsibilities. Rights create duties
Receiving a ‘hefty fine’ is not enough for some corporations, for example the oil companies that cause devastating oil spills in our oceans, need to do more than just clean up the mess made to the environment that the spill has damaged and a fine, they need to correct the issue so that the likely hood of more spills happening becomes extremely minimalistic. Those immediately affected by the explosion would have suffered but other employees of BP probably not at all as BP is still in business, employing people and making profits while individuals outside of BP were hugely effected with businesses lost, quality of life reduced.
It is not just up to us as the end users of the produced oil to clean up after the oil companies, yet we do with the likes of Greenpeace. We don’t see the owners and shareholders of the oil companies getting out into our oceans or on the beaches cleaning up the oil and the wildlife and their environments like they should do, we see volunteers out there and devoting hundreds of hours of their time doing it. That just doesn’t seem fair or right, to me and probably to other people throughout the world too.
In commercial law corporations and businesses have separate legal identities to their owners and shareholder, and it is the corporations that are held accountable in the courts for what they choose to do not the owners or shareholders, although there is also the possibility that the owners and shareholders could be held accountable for their actions inside the corporation or business if the corporation cannot be taken to court. This under section 2 of the people’s rights amendment means that the corporations ‘are subject to regulations as the people’ but as the blog states “incorporated entities don’t get constitutional rights at all”. This means that any and all property could be seized by the government and they wouldn’t have the right to due process, and this goes against the constitutional rights of the people. the Kim Dotcom’s Mega Upload case example we see no one’s rights being respected. the company’s assets were seized before the company was even charged due to bullying by the American FBI. This affected a great number of users of his service, most of them using the services for legitimate, legal reasons. If the state can take action against a corporation that is not fully supported by court rulings, what protection is there for individuals who are in some way stakeholders of that corporation?
The seizer of the entities property and that of the shareholders etc. that they hold could be done for any reason and there is nothing that they can do until the government decides that it can and will be returned to them. It also means that it could be many months or years before they have a fair trial as they don’t have the right to due process and this could cause the corporation to close for business for good and they would not receive and explanation on what it is that they are being charged with. although the peoples right amendment starts to contradict it and all of this would only be relevant if section three did not exist but it does.
If the corporations change their codes of ethics and the governments change the regulations so that the corporations are in line with the constitutional rights, or human rights, of those for citizens then the playing ground would be fair and people would not get angry because a corporation has too much power and take advantage of the environment and the human race, such as in the case of the oil companies and the oil spills that destroy the wildlife and their environments. It would also mean that a corporation could not have its property seized without explanation and held until the government decides that they can have it back. It would also mean that the corporations would have the right to due process and that anything that they are charged with would be dealt with quickly and effectively so that the corporation and the shareholders did not suffer and would know what it is that they have been charged with. This would go a long way in solving the problems with the people’s rights amendments.
I am curious. If, as you suggest, the Lochner-ish Supreme Court did not invent the concept of corporate personhood, where did the concept first originate?
The notion goes back many hundreds of years in Europe and the Middle East. In some sense or another, it goes back to ancient Rome and India. See here: the Corporation.
For a good brief introduction, see also the first chapters of Micklethewait and Wooldridge’s book, The Company: A Short History of a Revolutionary Idea.