In these days of unctuous interfaith ecumenism we could easily forget how many people died gruesome deaths over the centuries because of disagreements about the nature of the Trinity. There were, you could say, a lot at the stake on the burning issue of whether the son was the same as or similar to the father.
Similar grounding in theology may be necessary to understand modern company law. European lawyers accept that companies are funny creations – artificial legal entities – but in the US they have most of the privileges of human beings and few of the disabilities.
Indeed, corporations have been far and away the most successful litigants – as ‘persons’ – under the 14th Amendment, whose drafters aimed at equal rights for freed slaves. Since segregation lasted a century after the Amendment, the freed corporations got the best part of the deal by abusing it almost from the beginning.
The issue still rankles. In June the Supreme Court sent back to the California courts the case of whether Nike’s assertion of its virtuous sweatshop policies in newspapers was free speech protected by the First Amendment or commercial speech covered by California law. The judges implied that if Nike’s claims were not in pursuit of sales then it could indeed claim constitutional rights.
But what other purpose can a corporation have if not commercial? Can it have ‘opinions’ on matters like who will win the World Series or the legalization of same-sex marriage? We tolerate, probably too much, companies’ involvement in politics, but the underlying rationale is that they are protecting their commercial interests.
If you take this to its illogical end, why not allow companies to vote or run for office? President Enron has a certain ring to it, and some cynics would cite economies in cutting out the middleman.
But if companies are to have such rights, what about legal restraints? Shouldn’t two telecoms companies proposing a merger be subject (outside Canada at least) to prohibitions against same-sex marriage? And when it comes to demergers, why do we mere flesh and blood mortals have to invent excuses for divorce courts?
Indeed, if they are persons, doesn’t the Second Amendment cover companies? And if they have the right to bear arms, it is, says the Second, contingent upon a militia for the common defense. So are they liable to the draft? If a human person can have their career and income stripped from them to risk their life under martial law for the common good, then why not companies, too?
Nationalization seems a logical corollary, although corporations effectively have the privilege to go draft dodging. They can shift domicile at the drop of a resolution. If I told the IRS or Selective Service board I had a name plate on an office door in the Cayman Islands so they couldn’t tax or draft me, how long do you think I’d stay out of prison?
But to return to the First Amendment, if a company has free speech, does it have free will? For the theologically inclined, can it have free will if it has no soul? If I tell a lie as a mere corporeal person, Dante says, I end up in the tenth pit of the eight circle of hell. Does a corporation suffer eternal torments for telling fibs?
We know that in secular law a company’s shareholders have a get-out-of-the-Inferno-free card, since they have only limited liability. But what about management? It seems they too are unlikely to be toasting their muffins on the gridirons of hell anytime soon. In May MCI (aka WorldCom) was fined untold millions because management cheated shareholders. Who pays? Not the human executives but the company; shareholders will pay a fine imposed on management for cheating them. It is indeed very theological. If shareholders take legal action against management, they may have to be prepared for some hefty self-flagellation.
Perhaps it’s just as well. As it kicked the Nike case back to California, the Supreme Court was also striking down all sorts of state laws that had forbidden homosexual practices. Since companies are officially persons, it means that they too can now indulge in sodomy and other sorts of arcane sexual practices hitherto denied them. But then many of the shareholders in the Enrons, WorldComs and Tycos of the world may well suspect that they have been the recipients of this kind of treatment for some time, so the decision just formalizes existing practices.
The Speculator
