Law in the Internet Society
Corporate Law: Protecting Corporations From Us

One of the original purposes for the corporation is that it lives past the existence of its members. They exist in perpetuity and they never die. But we should kill the corporation, at least as we know it today. More importantly, we should realize that our own creation of laws have faced us with the need to kill these non-living things. We don't necessarily learn this in law school but corporate personhood is an oxymoron.

In studying corporate law for the past three years, I have been instructed, on more than one occasion, to believe that the creation of the corporate veil and the advent of limited liability companies are two of the more important creations in the field of corporate law. This may be true. I was never instructed to ask of what, and to whom, are these creations important? In answering this question, I have realized that these are merely tools used by corporate owners (real people) to escape their social responsibilities. These are tools that get dirty for the people who cannot stand taking responsibility for their own actions. They are more like gloves and these gloves have enough blood on them to bring the death penalty upon many of the corporations that exist in today's world.

Let's get some minor things out of the way. For the most part, in American society, the word veil brings to mind weddings and beauty. A quick Google search allows one to see the goodness associated with the word. The corporate veil is not this type of veil. It is a veil as much as Hitler was a leader: it fits the definition but not exactly the first word that comes to mind. When looking beyond the euphemism, one sees the corporate veil more as a protective shield, or for that matter, as an army of protection that fights for personhood but against persons.

For many corporations, the sole purpose of the corporate veil and the limited liability corporate form is to protect the corporation's owners from facing human consequences. The corporate veil provides the necessary distance for corporate owners to escape social responsibilities in the name of profit and as if that weren't enough, the formation of a limited liability company builds a whole new level of defense, allowing owners to commit actions through their corporations without personal repercussion. Those same actions, if committed by a natural person, could be considered criminal actions and clear violations of human rights.

One would think that corporate owners would be content with a veil and limited liability protecting them from most forms of social responsibility but that was not enough to protect their profits. They desired an even stronger weapon to protect their asse[t]s. They wanted the convenience of picking and choosing when they should have the rights of natural persons. These profit-driven, often inhumane organizations have sought personhood in the court system throughout our country's history but only when it would be convenient for their profits to be deemed a natural person in the U.S. legal system.

Early on in our nation's history, courts and government officials were hesitant to give in to these requests. Andrew Jackson was wary, once stating that the problem with corporations is that they have "neither bodies to be kicked nor souls to be damned." But over time, as corporations gained power in American society, they not only attained the rights of natural persons but were also handed the rights of Superman without the expectations of saving the world and protecting society from evils. They were persons when they wanted to be but they were not to be punished as persons unless the courts were capable, and willing, to pierce their veil.

In the U.S. court system, it has been ruled consistently and frequently that corporations are legal persons. In two well-known cases, Buckley v. Valeo (1976) and Citizens United (2010), corporations quietly snatched up rights that took real people centuries of war and violence to attain, gaining the First Amendment's right to free speech, including the right to contribute to political campaigns. Look at those dates a little closer and you will see that just a few moments passed between the time that real people, African-Americans, attained the rights of natural U.S. citizens and the time that corporations attained an even stronger right in the political scheme. Citizens of the United States may have the right to vote but corporations have the right to create the electoral process through financing political campaigns and more or less cherry-picking favorable candidates. The right to make the election is much stronger than the right to vote. Yet again, these corporate owners were greedy, and decided that it was not enough for their corporations to gain the right to free speech, toss our country's democratic system into a flambé dish, and eat up our country's values as if it were just a typical dessert.

Corporations also sought the right "not to speak" as part of their First Amendment rights. In International Dairy Foods Association et al v. Attorney General of Vermont, a Federal Court overturned a district court decision and ruled that a Vermont labeling law was unconstitutional. That law required products containing recombinant bovine growth hormone to be labeled in order to protect consumers from a dangerous genetically engineered product. The Court stated that "because the statute at issue requires appellants to make an involuntary statement whenever they offer their products for sale, we find that the statute causes the dairy manufacturers irreparable harm...he dairy manufacturer's right not to speak is a serious one that was not given proper weight by the district court." Corporations have the right not to speak when they knowingly injured real people. Profit concerns for the multinational corporation involved in the case seemed to outweigh the public health concerns of real people. If that case does not do it for you, check out the court battles between Monsanto and the People of Anniston, Alabama, where the food conglomerate, Monsanto Corporation, in the name of profit, withheld knowledge about poisoning an entire town's worth of people. These are court decisions in the greatest system of justice in the history of the world.

These "natural persons" are slowly sweeping across every inch of our country and our planet, sucking up every power they can possibly find with high human costs. When natural persons have tried this in the past, they have always failed because somebody takes a stand against them. Napoleon tried this and lost at Waterloo. When Hitler tried this, the Allied Powers fought back with nuclear weapons. But when a multinational corporation tries this, we try them in court, place a veil over their head, and even in the instances when we pierce this veil, we only do so to ask for a small amount of money from their ever-deepening pockets in the politest way possible, only to hand the money back to them by purchasing their products in the near future. That is not an efficient market according to capitalism. It is a monetary inertia that exhibits little, if any, human progress.

If they are persons, they are persons that should be spending their lives in prison or at least at a psychiatric institution. There are reported studies concluding that if truly classified as persons, many corporations would fall under the classification of "psychopath." Instead of dealing with them properly, we have allowed them to place us in a panopticon, watching our every move to ensure that we are helpless in defending ourselves. They follow us in supermarkets to the point that they know what aisle our shopping carts are in at all times. They read our emails and know our friends. They "know if you've been bad or good" but they do not act like Santa Claus. Even if we could defend ourselves, corporations have an advantage over humans. They are legally immortal. Remember, they do not die. This is a clear advantage over people because if they want something from us, they can just wait until we die to get their hands on it. They have waited out Alaskan natives to take over entire tribal nation properties for oil-drilling purposes.

Some may argue that they have given us so much and I admit the truth in those statements. Some corporations have helped to alleviate poverty, increase our production, make our lives easier and healthier, etc. but did the corporations and their owners intend these beneficial results or were the results just unintended consequences of their profit schemes? The corporation has come into our lives, taken our property, taken our rights, taken our freedoms, taken our health, paralyzed us with illusory choices, and has recently sucked up all of our savings by convincing us that extreme consumerism and materialism are productive systems of living.

If a truly natural person tried to do all of that to you, how would you react? I would hope that you would find a way to stand up for yourself, whether by a legal battle or a bout of physical violence. But for most of us, it is easier to join them than to beat them, pretending that the possibilities corporatism presents to us at least makes the ride fun for our lives. So we accept all of that and sit back in our corporate clothes, on our corporate couches, watch corporate commercials, view corporate advertisements that try to convince us to consume corporate products and ensure that we stay seated comfortably on our couches.

I do not know if this is just some evolutionary twist that will work itself out but merely observing it is clearly disturbing. It is as if many of us have given up on the human instinct to survive. We have surrendered our freedom and our volition, the exact things that make us living persons, to a group of non-living entities.

After studying corporate law for three years, I have learned that the corporation is well protected. I was never instructed to ask whom they were protected from but the answer is people. It finally struck me why I found corporate law so interesting but wanted no part of it in my career search. Corporate law takes the rights of living things and hands those same rights to entities that are treated like spoiled children. Maybe those fines are sending the corporations to their rooms but they have everything they want in those rooms. There is secrecy, security, prosperity, and profit in those rooms. That is not punishment or deterrence; that is just bad parenting. We give them cause to do whatever they want without caring about the consequences and unlike spoiled children, they have enormous voting power.

There should and could be a middle ground. A legal regime where we can use corporations for the benefit of society, maintaining control over our lives and controlling their choices to ensure that they are responsible to life. We should not give up the great things that they provide but we should minimize the harms that they bring with them. Like the spoiled child, they have to act responsibly and they must mature. Until there is proof that a corporation is a contributing and functioning member of our society, I do not think they should have the rights of real persons.

-- DiegodelaPuente - 15 Nov 2011

 

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r3 - 09 Dec 2011 - 06:00:50 - AlanDavidson
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