The Supreme Court has come up with some unusual meanings for some common words. In the process, they have changed the nature of the American corporation at the expense of average citizens.
Because this has to do with the Court, it gets a little legalistic, but much less than you might expect.
In law, affected parties may be called “persons.” Historically, there have been two kinds of persons – natural and artificial. “Natural persons” are human beings. “Artificial persons” are organizations, like corporations.
The big question raised by the Supreme Court is whether there is any difference between them. This Court seems to be saying there isn’t. In other words, corporations should be treated pretty much like human beings.
In a case decided less than two weeks ago, the Court ruled that, because government cannot force individuals to support contraception, it cannot force corporations, owned by individuals, to provide health insurance coverage paying for contraception.
A lot has been said about this decision applying only to “closely held” corporations, ones owned by a small group of people, not those whose shares are available for purchase in the open market by anybody who’s interested.
The Court said individual rights of human beings applied also to corporations owned by a small group of people.
What about major corporations? The majority opinion says “it seems unlikely that the sort of corporate giants to which [the government] refers will often assert…claims” like those of the small corporations. “Seems unlikely” may not sound like what a major Supreme Court decision should conclude about the law of the land.
It seems unlikely the Supreme Court would decide differently if a majority of any corporation’s shareholders wanted it to be exempt from the contraceptive requirement.
The Court’s decision is based on the belief that a corporation is nothing more than a collection of natural persons, so it should be treated just its individual owners would be.
If that were true, there would be almost no reason for corporations to exist. The main reason they exist is to shield their owners from legal liability. If you want to sue a company for its wrongdoing, the corporate form keeps you from getting at the owners.
In other words, according to the Supreme Court, corporations have more privileges than people, because their owners have the rights of natural persons, but not the same exposure to liability for their actions.
It gets even better. If you commit a crime, you can go to prison. If a corporation commits a crime, it pays a fine that probably comes out of the pockets of shareholders who have no control over corporate actions. In fact, the government probably won’t even bother charging it with a crime, just levy the fine.
If corporations are nothing more than collections of their individual owners, why can’t members of their boards of directors go to jail when their companies break the law? That could be the best way to cut down on corporate lawbreaking.
But, the corporations might argue, we don’t have the most important right of individuals – the right to vote. Individuals have votes, which should give them more power.
In a decision a few years ago, the Supreme Court ruled that corporations have the same freedom of speech as individuals. Almost 40 years ago, in a decision giving a new meaning to common words, the Court ruled that political contributions were a form of speech. Result: corporations can contribute freely to political campaigns.
Corporations may not the vote the way individuals do, but they have a lot more money to contribute. And the record shows that money determines political outcomes.
Getting back to the Court’s decision on contraceptives, the majority said that the decision really would have no effect, because the government had already created an easier method for providing coverage if a company declined to participate. Just use that method, and the decision would not harm employees of companies refusing to pay for contraceptive coverage.
That decision had a shelf life of three days. In a new decision, the Court said that it would have to consider whether that method was legal and, in the meantime, it could not be imposed on an entity that objected.
The three female justices on the Court blew up on that one. They had warned the original decision would lead to an expanded ability for artificial persons to exempt themselves from laws on the grounds of their religious beliefs. The majority had scolded them for overreacting. Then it did just what they had predicted.