Corporate Power, Free Speech, and Democracy

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CORPORATE POWER, FREE SPEECH, AND DEMOCRACY

Although corporations do not enjoy all constitutional rights enjoyed by individuals—for example, neither the right against self-incrimination under the Fifth Amendment nor the right against interstate discrimination under the privileges and immunities clause of Article IV has been extended to corporate entities—they have been held to enjoy the right of freedom of speech under the first amendment. Numerous First Amendment claims have been litigated on behalf of media corporations invoking the freedom of the press as well as free speech. But the free speech clause has also been extended to nonmedia corporations. In first national bank of boston v. bellotti (1978), the Supreme Court invalidated a state law prohibiting any corporation from making contributions or expenditures for the purpose of influencing the vote on any state ballot initiative or referendum question other than one directly affecting its business. And in Pacific Gas & Electric (PG&E) v. Public Utilities Commission (1986), the Court invalidated a requirement that a utility corporation carry unwanted literature in its billing envelope. Each of these cases was decided over a vigorous dissenting opinion objecting that speech rights should be limited to natural persons, and that speech restrictions were a permissible condition upon government's grant of the considerable privileges of the corporate form.

Critics of corporate free-speech rights argue that corporations, which lack souls or personalities, cannot have any right comparable to that of individuals in self-expression. As Justice william h. rehnquist wrote in dissent in PG&E, to ascribe "to such artificial entities an 'intellect' or 'mind' for freedom of conscience purposes is to confuse metaphor with reality." But the majority of the Court, in extending free-speech protection to corporations, has reasoned that the First Amendment protects values beyond speaker autonomy—specifically, the values of ensuring the free flow of information to the public and preventing the government from entrenching itself in power by distorting debate or suppressing dissident views. These systemic values, the Court has concluded, counsel against allowing government to regulate speech even when the speaker is a corporation.

A further reason for the Court's approach may well be the serious line-drawing problems that would attend any attempt to exclude corporations from free-speech protection. A tobacco manufacturer is a corporation, but so is a book publisher, a broadcasting company, a daily newspaper, and a nonprofit advocacy group. Excluding all corporations from the First Amendment would untenably exclude the speech of nonprofit advocacy organizations. But excluding only for-profit corporations would eliminate most newspapers, publishers, and broadcasters—an outcome incompatible with freedom of the press. Any attempt to exempt the institutional media would raise intractable problems of deciding who counts as a member. And although corporations do enjoy certain state-conferred advantages such as limited liability and tax benefits, government confers similar advantages on a range of other collective entities, from labor unions to political parties, that surely would not be disqualified from First Amendment protection on that account.

Still, critics object that corporate enjoyment of free-speech rights may itself distort or dampen debate and diversity in public discourse, so that corporate speech regulation will enhance rather than inhibit the freedom of speech. Such objections rest in part on the disproportionate market power of corporations, and the fear that freedom for corporate speakers will produce public debate dominated by those that are economically powerful. As Justice byron r. white objected in dissent in Bellotti, corporations have acquired "vast amounts of money which may, if not regulated, dominate not only the economy but also the very heart of our democracy, the electoral process." A related but separate objection is that corporations will be able to use wealth aggregated for economic purposes to express political views without regard to whether they reflect the actual opinions of owners, customers, or employees.

The Court has acknowledged the second but not the first of these objections. It has maintained that regulations aimed at the content of speech may not be justified by the goal of equalizing relative speaking power—whether by inhibiting the speech of wealthy corporations or wealthy individuals. But in a narrowly divided 1990 decision, austin v. michigan chamber of commerce, the Court held that for-profit corporations may be required to segregate their expenditures on behalf of political candidates from their corporate treasuries in order to deal with "the corrosive and distorting effects of immense aggregations of wealth that are accumulated with the help of the corporate form and that have little or no correlation to the public's support for the corporation's political ideas." Similar segregation requirements, the Court had previously held in Federal Election Commission v. Massachusetts Citizens for Life (1986), may not constitutionally be imposed on nonprofit advocacy organizations, which present no similar danger of distortion. Thus, Austin stands as a shallow bow to the critics against a general backdrop of constitutional protection for corporate speech.

While the First Amendment has been held to bar most direct regulation of corporate speech through content-based laws, it also has been held to permit a wide range of content-neutral structural regulation of speech markets. For example, in turner broadcasting system v. federal communications commission (1994, 1997), the Court held that Congress may require cable operators to carry broadcast programs they would otherwise drop in order to ensure competition in the video programming market and diversity in the broadcast choices available to households lacking cable television. Nor does current First Amendment law bar enforcement of general antitrust law against media conglomerates found to have excessive market power. All that is required is that the goal of such structural regulation be economic rather than ideological, and that the regulation not be needlessly broad.

Kathleen M. Sullivan
(2000)