The Supreme Court has long held that corporations have rights under the U.S. Constitution. The question that has been bandied about in recent times, however, is “which ones?” In cases related to campaign finance laws, the Court has held that corporations have a “freedom of speech” right under the First Amendment that allows them to make expenditures on political campaigns. At the same time, it has allowed limits to be placed on those expenditures. In a 2010 ruling, the Court reversed course, and the implications for small business have been profound.
The 2012 Election: Most Expensive, Least Transparent.
In Citizens United v Federal Election Commission, a sharply divided Court struck down laws that placed restrictions on corporate and union spending on political campaigns. The ruling unleashed a torrent of corporate electioneering money. According to publicintegrity.org, the 2012 election was the most expensive and least transparent presidential campaign of the modern era — exceeding all others by over $700 million. The bulk of that increase came from a small group of extremely wealthy donors and very large corporations.
Super PAC’s and Less Than Full Disclosure
Political contributions, which used to go directly to candidates, now end up swelling the coffers of super PACs — independent organizations that can raise money to either endorse or oppose a candidate for office . The fact that super PACs have figured out how to skirt disclosure rules by establishing nonprofit “social welfare” arms, only exacerbates the situation. Not only are donations to super PACs from large corporations and wealthy individuals unlimited, most are anonymous.
Bad for Small Business
In a survey of small business owners conducted by the American Sustainable Business Council, Main Street Alliance and Small Business Majority, 66 percent of respondents stated that the Citizens United ruling had been bad for small business, and fully 88 percent viewed money in politics negatively. The decision substantially increases the influence of large corporations and wealthy individuals in politics. When big business can provide unlimited funds to influence elections, small business loses political clout.
Two aspects of the Court’s decision in particular were highly controversial. First, it effectively said that corporations are people. Because corporations provide a way for individuals to exercise their right to free speech, people acting as a group through a corporation have a legitimate claim to legal protection. Second, it equated money with speech. Because money facilitates speech, laws that limit spending on political speech violate protections provided to persons by the First Amendment.
Efforts to Rewrite the First Amendment
In response to the Citizens United ruling, many grassroots organizations have called for a First Amendment rewrite. Move to Amend is one such group. Comprised of hundreds of state-based affiliates across the country, it has put forth a draft amendment arguing that corporations do not have the same constitutional rights as persons and that restricting corporate spending on elections is, therefore, not an infringement on freedom of speech. The movement has garnered widespread support from the small business community.