Wednesday, December 03, 2008

File This One Under "S" For Stupid

Here's another old post I've had kicking around for some time now, one that is perhaps more relevant in a political climate that's become increasingly fearful of markets.

With that being said, I give you Reclaim Democracy Dot Org, an organization seemingly devoted to crushing corporate power ... or some such thing. And this is their proposal, a Constitutional amendment to limit the rights of corporations and like, restore power to the people.

Here's the proposed Amendment:

SECTION 1. The U.S. Constitution protects only the rights of living human beings.

SECTION 2. Corporations and other institutions granted the privilege to exist shall be subordinate to any and all laws enacted by citizens and their elected governments.

SECTION 3. Corporations and other for-profit institutions are prohibited from attempting to influence the outcome of elections, legislation or government policy through the use of aggregate resources or by rewarding or repaying employees or directors to exert such influence.

SECTION 4. Congress shall have power to implement this article by appropriate legislation.

I think the reason I've had this post kicking around for so long was because I kept wanting to delve into some of the specifics of corporate law, but it's probably not necessary. Perhaps the one legal fact all you non-legal types should know is that the legal concept of the corporation is designed to allow investors (shareholders) to invest some of their money in a business venture without having to risk all of their assets. The liability of shareholders in a corporation is limited to the money they invested. And just about anyone should be able to see why this is desirable- without that protection, why would anyone risk their wealth in an investment which could cost them everything. Keeping that all in mind, each state has it's own corporate law structure, laying out the basic rules of the game and setting up a number of default rules.

Now, back to our proposed amendment, which I'm sure has any number of lefties drooling. Section 2 seems self-apparent- corporations are just as bound by the law as any other group or individual is- And section 4 is merely a Congressional enforcement clause. So the real interesting (and troublesome) pieces here are Section 1, which proclaims that the Constitution only grants rights to human beings, and Section 3, which would basically prohibit corporations from any involvement in government. This amendment encapsulates the desires of the far left, but also reveals some real intellectual bankruptcy. Limiting corporate power is one of those great, feel good ideas in theory that tends not to hold up to any sort of logical, legal scrutiny.

The practical problem, as I indicated before, is that a corporation is made up of individuals, just like any other sort of organization. So when it's said that the Constitution protects only the rights of human beings, what does that exactly mean? Does that mean free speech rights apply only to individuals and not to groups of people? Does that mean that protection from illegal searches and seizures applies only to individuals and not to organizations. I can think of a great number of anti-war groups who wouldn't be too pleased with that interpretation.

And even if you were to include some words here about protections not applying to for-profit corporations, what does that mean for small business? If you run a business out of your home but don't incorporate does the Constitution apply to you, whereas an individual who incorporates and runs a business out of his home wouldn't have any Constitutional protections from searches and seizures?

The third section is even worse in it's attempt to limit speech from for-profit organizations. Again, does that mean the small businessman is simply not allowed to take part in politics? What these anti-corporate activists always forget is that the corporation is merely a structure. I actually agree about the troublesome influence of large corporate institutions, but that's an issue to be dealt with delicately, not with a broad swiping away of rights.

Some folks get all worked up over notions of corporate personhood, but these concepts exist so corporations can be subject to the legal world, not to exempt them from it. We want (or should want) corporations to have Constitutional protections because the government should have to follow legal due process when dealing with corporations and because the government shouldn't be able to storm in and demand to see a corporations records. In fact, I believe that's precisely what the left (and civil libertarians) have been fighting for over the past several years, claiming that without a warrant, the government shouldn't be able to search through Google's and AT&T's records. Without Constitutional protections, that's just what you'd get. The 4th Amendment could be completely subverted without the ability of corporations to protect their records of our personal business. Of course, some folks just don't get that, which is why I filed this one under "S" for stupid.


Anonymous rose said...

How? How can these people be so stupid? How do they not see the hypocrisy here!

In a free-market, a corporation gets money from two sources: investors and consumers. That's it. And in either case the investor and consumer are benefitting (or believe they are) from the value the corporation provides (product, or stock). When the government stays out of the market, there is no need to worry about corporate influence on politics.

Now, let's raise taxes on these dirty corporations and raise money. Then let's re-direct these funds where we, the government, sees fit. Infrastructure. Green energy. GM. Whatever. Which specific companies get the money???

The most politically connected of course. The strongest lobbiers. So in this case, tax payer money is FORCIBLY taken and redistributed to politically connected entities.

How can you hate markets, hate lobbying, decry special interests and support expansion of government in the market place?

By being a moron.

Good piece LL.

2:37 PM  
Anonymous rose said...

Aren't you excited to have your tax dollars finance the continued development of the Chevy Volt! I can't way to buy one for $40,000. Oh but I'll get a $7,500 tax subsidy...wait who's paying for the subsidy??? Wait, the car only get 40 miles per charge??? That's like having a gas tank that fits 2 gallons of gas. This is what is going to save GM...that and our tax dollars.

2:42 PM  
Blogger lonely libertarian said...

Yeah, the "forcing them to go green" is the most insane part of the proposed auto bailouts, as if forcing the automakers to make more cars people don't want will actually solve their financial problems.

2:48 PM  

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