National News

How corporations won their own civil rights movement

Posted May 4, 2018 4:48 p.m. EDT

— Procter & Gamble never marched on Washington singing "We Shall Overcome." Google was never blocked from eating in a diner that said, "For People Only." Nobody ever called the Pillsbury Doughboy the N-word.

When people talk about the oppressed, they usually refer to groups like racial minorities or gays and lesbians. But a new book shows how corporations successfully staged their own freedom movement by employing tactics associated with civil rights struggles: civil disobedience, test court cases and portraying themselves as victims of political persecution.

In "We The Corporations: How American Businesses Won Their Civil Rights," UCLA law professor Adam Winkler details how corporations waged a two century-long campaign to win nearly the same rights as ordinary people: freedom of speech, religious liberty and "personhood" -- the notion former Republican presidential candidate Mitt Romney alluded to when he said, "Corporations are people, my friend."

Romney's declaration was part of the rationale that produced Citizens United, a 2010 Supreme Court decision that eased restrictions on spending by corporations and unions in political campaigns.

That decision was widely criticized, but questions over corporate power in politics persist. Facebook has been accused of swaying a presidential election. A recent overhaul of the nation's tax code has been depicted as a corporate giveaway. In another victory for corporations, the Supreme Court said this week that companies could block workers from banding together to fight legal disputes in employment arbitration agreements.

Some even say the US is no longer a democracy but a "corporatocracy."

In an accessible and engaging read, Winkler shows how corporations took their cries for freedom, not to the streets but to the Supreme Court to become "the most powerful players in American politics."

They successfully argued that their equal rights were being violated by unwanted regulations and taxes. And they engaged in civil disobedience by refusing to pay what they considered unlawful taxes, deliberately breaking the law to send test cases to court.

"We think of the Supreme Court as a bulwark to protect minorities," Winkler says, "but it's used that power much more often to protect the rich and powerful."

In one of the most astonishing sections in the book, Winkler recounts how the corporations and the court transformed the 14th Amendment -- designed to protect the basic rights of freed slaves after the Civil War -- into a weapon to boost corporate power.

He writes:

"The 14th Amendment was converted from a shield for the rights of racial minorities -- who found little protection from the Supreme Court for the next half-century -- into a weapon for corporations to use against state laws regulating business activity."

Winkler recently sat down with CNN to talk about the book. This interview has been lightly edited for brevity and clarity:

Q: A lot of people complain about the growing power of corporate money in politics, particularly after the Supreme Court's Citizens United decision. You say that it's difficult for courts to control the power of corporations in politics. Why is that?

A: We think of the courts as being a place of equal justice, of Lady Justice being blind to the relative finances of the parties. But the court system is also uniquely designed for those with money to take advantage. And corporations, unlike civil rights organizations, have had the resources to hire the best, most creative and most experienced lawyers in the country to represent their interests in court.

Corporations have the resources and the willingness to think of litigation as just the cost of doing business. They fight over and over again to challenge nearly any law in court that regulates their activities in ways they don't like. It takes money to bring lawsuits, and they have the money to bring the lawsuits.

Q: How did the 14th Amendment become this weapon to benefit the powerful?

A: It's one of the most remarkable turnarounds in constitutional law. Corporations have been able to turn progressive reforms into reforms that help business and capital.

The perfect example is the 14th Amendment, adopted after the Civil War to protect the rights of the newly freed slaves. But the Southern Pacific Railroad company 15 years later went to the Supreme Court and said this provision protects corporations, too. And eventually the Supreme Court would agree.

In 1913, there was a study of Supreme Court cases under the 14th Amendment, and it discovered that the Supreme Court had, over the past half a century, heard 28 14th Amendment cases on the rights of African-Americans -- most of them ruling against African-Americans. And at the same time the court heard 312 cases on the right of business corporations, with corporations winning many of those cases.

The 14th Amendment was adopted for the dispossessed and the outcast. But it was used more vigorously and successfully by the forces of capital.

Q: Why was the court so deferential to corporate power and less vigorous enforcing the rights of African-Americans?

A: Part of the reason is that we misunderstand the Supreme Court. We think of it in terms of left vs. right -- are they conservative or liberal. But what's united the justices over the course of American history is that they've generally been pro-business, whether they are liberal or conservative. I think that reflects our political process, the influence that corporations have in getting their presidents elected and presidents who support business.

And let's face it, in a capitalist system businesses will always be powerful and influential because they bring the material wealth that everyone depends on. That's why we see cities throwing money and tax breaks at corporations to come move there even when the economic benefits are not really crystal clear. So corporations are by necessity pretty powerful.

Q: What are the potential consequences in America if corporate power continues to grow unchecked?

A: We have such a complicated relationship with corporate politics. We criticize corporations for spending money on elections in the wake of Citizens United. At the same time, we celebrate Dick's Sporting Goods when they announce they're not going to sell guns to people under the age of 21. Or we complement a private company that says we won't do business with North Carolina because they're discriminating against transgender people.

We have a complicated relationship with business and politics. On the one hand, we don't want business to take over our politics. On the other hand, we as consumers often recognize that business can sometimes be more responsive to our demands than elected officials are; especially in this era of partisan gerrymandering when we don't have much influence over who gets elected to office, we do have some choice about what we can do with our spending dollars.

Q: Is it naïve, though, to expect corporations to be a consistent force for social good? You talk in the book about corporations' primary duty, which is to their shareholders.

A: I think it's true that corporations can be a vehicle for public good, but it'll only happen when that public good corresponds with the business interests of that corporation. And so that's the warning sign you have to watch out for.

The same corporate power that can lead a state to say we're not going to pass a transgender bathroom bill because we're afraid of corporate boycotts can lead to a Trump tax bill, which provides massive tax breaks to corporations and hurts ordinary individuals. It's a real problem.

Corporations get involved in politics and assert constitutional rights not because they're seeking dignity and the kind of freedom we're looking for. They're doing it so that they can pursue profit. And profit only. We have to remember when corporations are empowered that they are always going to be directed by that profit motive.

Q: You talk about a time when the courts were more suspicious of corporate power in politics. What's the difference between that time and today? What was happening?

A: There was a huge scandal between 1905 and 1907. It was known as The Great Wall Street Scandal. It showed that Teddy Roosevelt, who had created this public image as a trust buster who was going against corporations, was really in the pocket of big business.

He had won an election in 1904 with a vast majority of financing coming from corporations. This led to a huge scandal. There were investigations into how corporations were getting involved in politics. People asked, how could we stop corporations from exerting this kind of power. And we saw the rise of campaign finance laws in response to this scandal.

So there was the attitude that people recognized that corporations were important, but that they were important for business and making money. But they didn't have the same rights of personal liberty and personal conscience that people have. It's a lesson that today's Supreme Court has seemed to have forgotten.

Q: You make an interesting point near the end of the book when you talk about the Supreme Court's 1976 Buckley v. Valeo decision and the principle of equality that is basic in law.

A: One reason why campaign finance laws keep getting struck down by the Supreme Court is because it says there is no legitimate government interest to promote equality in the political process.

This is a very odd statement about politics. Equality is such an important principle in American politics. Everyone gets one vote. You don't get two votes. It's not like corporate America where shareholders can get as many votes as they can get shares for.

Even the contest of speech around elections, we have a principle of equality. If we have a debate we have two candidates -- they get equal time to argue their positions. For a long time we even had equal time rules for the big three broadcasters. Even in oral arguments in the Supreme Court, each side gets equal time.

Q: If corporate power keeps expanding, where does America end up? I hear people already saying we're not a democracy but a corporatocracy. Is that hyperbole?

A: I can't tell you. It's complicated. Corporations don't rule everything. But they rule in a lot of things. Political scientists often show that in issues of high public salience, like abortion or gun rights, those are issues that are not going to be affected that much by big business because people's views on those are really locked in personally.

But where corporations are most powerful are on regulatory issues and environmental laws, little things that people aren't paying attention to. In those issues, like the [Trump] tax bill, corporations do really well.

I do think we are moving into a world where corporations are gaining more power, and gaining more rights that are troublesome: rights of political speech, rights of religious liberty to give them exemption from generally applicable laws. At the same time, we are seeing people trying to use corporations to do good.

Ultimately, if we are going to make our society a better and more just society, we're not going to end up getting rid of corporations. We have to make corporations serve us better.