Foreign Corporations More Equal Than Foreign Nationals

One of the several burning questions following the Supreme Court's Citizens United decision was touched last night in the State of the Union. President Obama said, "With all due deference to separation of powers, last week the Supreme Court reversed a century of law that I believe will open the floodgates for special interests –- including foreign corporations –- to spend without limit in our elections. I don't think American elections should be bankrolled by America's most powerful interests, or worse, by foreign entities."

In remarks today responding to the president, Sen. Patrick Leahy (D-VT), chair of the Judiciary Committee, adding that not only did the Constitution not recognize corporations as persons in the first place, but that this Supreme Court has recently both limited the speech of actual persons and ruled that very large campaign contributions could create an appearance of corruption that the government has a compelling interest in preventing. Though Leahy included better references, so here's the floor over to him for a moment:

... The same five Justices willing to overturn well-established precedent to create broad new rights for corporations in Citizens United had no trouble severely limiting free speech rights for individuals. In a 2007 case, Morse v. Frederick, Chief Justice Roberts, joined by Justices Scalia, Alito, Thomas and Kennedy, held that the First Amendment did not protect an 18-year-old student from being suspended for holding up a banner across the street from a school during the 2002 Olympic Torch Relay. They held the principal could suspend that student, a legal adult, for displaying the banner, not on school grounds, but across the street from the school. All that was needed was for the school administrator to believe that the banner somehow promoted illegal drug use and was therefore against the school’s policy. Perhaps if that student had incorporated, these five Justices would now find his First Amendment rights protected. These are the same Justices who recently reached out to ban the streaming of public trial proceedings on a matter of public interest, as well, on similarly flimsy grounds in order to impose their own preferences.

It is also difficult to understand the lack of concern in Citizens United for the potential of massive corporate spending to distort elections in light of the Supreme Court’s ruling issued only months ago in Caperton v. Massey. In that case, Justice Kennedy wrote that the possibility of bias due to campaign contributions in a state judicial election meant that the judge was wrong not to recuse himself from deciding a case involving a defendant who had spent $3 million supporting his election campaign to the bench. I agreed with that decision. There, Justice Kennedy who wrote: “We conclude that there is a serious risk of actual bias – based on objective and reasonable perceptions – when a person with a personal stake in a particular case had a significant and disproportionate influence in placing the judge on the case by raising funds or directing the judge’s election campaign when the case was pending or imminent.” What I do not understand is how these same standards and obvious logic were not applied to corporate spending in election campaigns. ...

Leahy and others have also pointed out that US subsidiaries of foreign corporations wouldn't have spending restrictions under this new legal doctrine, they could even pass unlimited contributions to third party corporations for the purpose of altering US law and the results of elections. One way this could affect policy in the US springs immediately to mind: energy.

When Obama said last night that ""the nation that leads the clean energy economy will be the nation that leads the global economy," I think he was onto something. If the US followed up to work towards such leadership and to support the necessary research, it wouldn't be in the best interests of Saudi Arabia. Before, all a wealthy Saudi prince could do to shift the US away from renewable energy is buy a lot of shares in FOX News, which promotes climate denial. Now ... who knows how much the Saudis could spend to elect politicians who oppose the development of solar and wind power or funnel to established efforts to lie about science?

Indeed, the identity of a speaker has been key to several established legal precedents regarding speech, and Lawrence Lessig made good points about the federal benefits extended to corporations and the way this could harm democracy if those advantages are used to influence elections :

... But of course, corporations do receive a gift from the government. The government limits the legal liability of investors in that corporation in exchange for their risking their capital to spur innovation and growth. That benefit is significant. And the First Amendment question is whether in granting that benefit, the state would be free to limit the political advocacy that corporations engage in.

... That, however, is not the only, or the best, justification behind the regulations at issue in Citizens United. Those rules not about suppressing a point of view. They're about avoiding a kind of dependency that undermines trust in our government. The concentrated, and tacitly, coordinated efforts by large and powerful economic entities -- made large and powerful in part because of the gift of immunity given by the state -- could certainly help lead many to believe "money is buying results" in Congress. Avoiding that belief -- just like avoiding the belief that money bought results on the Supreme Court -- has got to be an important and valid interest of the state. ...

It's bad enough that US corporations (which is to say, their executives, boards of directors and controlling investors,) have been acting through their lobbying dollars to get government support for shipping jobs overseas. Now foreign corporations (which is to say, their executives, boards of directors and controlling investors,) can join in the fun.

(Video courtesy The Nation)

Though the worst thing is that while conservatives routinely complain about the potentially negative influence of foreign individuals, often ones who've come to peacefully earn a living in the United States, they're not bothered by the idea that wealthy executives and investors from other countries could influence our domestic politics. Conservatives are afraid of poor immigrants looking for work; Saudi princes buying an election through a corporate sock puppet, not so much.

Which is to say that, once again, this is a decision that puts the interests of the wealthy ahead of the interests of the working class, wherever they live. It's a decision that extends more trust to corporate 'persons' than to actual people, by allowing executives and investors from all over the world to spend pre-tax, corporate money on US elections that ordinary US residents can only spend taxed income to influence.

Anyway, perhaps more popular pressure for public financing of elections will come of this, and that seems like at least one potential benefit.

Views expressed on this page are those of the authors and not necessarily those of Campaign for America's Future or Institute for America's Future