Ask an Expert: Corporations are not people, my friend
— -- Q: Are corporations people, my friend? —Mara
A: Now that is what I call a great question! It is, of course, Mitt Romney's famous line from the primaries. The entire exchange went like this:
A voter in Iowa suggested to Romney that taxes should be raised on corporations to help balance the budget. Romney demurred, stating, "Corporations are people, my friend . . . Of course they are. Everything corporations earn ultimately goes to the people. Where do you think it goes? Whose pockets? Whose pockets? People's pockets. Human beings, my friend."
Literally speaking, Romney is correct. A corporation is made up of people. Those people make the corporate decisions, and profits from those corporations eventually flow to employees, management, and shareholders - to people.
So is it more accurate to say, "Corporations are made up of people"? Maybe.
Corporations, for the past 200 years, have increasingly been given rights and privileges reserved for members of the human race:
• In 1819, the Supreme Court ruled that corporations have the same rights as people to enter into, and enforce, contracts (Dartmouth College v. Woodward).
• In 1906, the court ruled that for legal purposes, corporations are "persons" (Northwestern Nat Life Ins. Co. v. Riggs).
• This idea of "corporate personhood" is now written into the United States Code: "In determining the meaning of any Act of Congress, unless the context indicates otherwise . . . the words "person" and "whoever" include corporations, companies, associations, firms, partnerships, societies, and joint stock companies, as well as individuals." (1 U.S.C. section 1).
Most recently and famously, the issue of corporate personhood arose in the Supreme Court's decision in Citizen's United, which held that the First Amendment's free speech clause means unions and corporations should be able to engage fully in the political process and as such, governments are restricted from limiting their political spending.
The four dissenting justices argued that there is in fact a difference between corporate people and natural people, and those difference are enough to warrant a different set of First Amendment rules for corporate persons. Alas.
And, getting back to the Romney quote, while clearly corporations have many attributes of personhood, there are other facts indicating that corporations most certainly are not people.
Can a corporation get married? Well, sure, plenty of people are married to their jobs, but that is not the same thing. And while criminal laws do apply to corporations, white-collar criminals go to jail, while corporations keep chugging along after any guilty verdict.
A corporation cannot run for office. A corporation cannot vote, although they can try to buy elections. A corporation cannot chill out at the beach.
I think most importantly, the interests of corporations are vastly different from the interests of a person, and therein lies the biggest rub.
As we all know, the main, some say sole, purpose of a corporation is to make a profit. Sure, the people in the corporation have other goals - to make a difference, to earn a living, to create something of value - but the corporation has one job: To make money.
As such, the decisions people make are different than the decisions corporations make.
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