Dollarocracy (17 page)

           
American business and the enterprise system have been affected as much by the courts as by the executive and legislative branches of government. Under our constitutional system, especially with an activist-minded Supreme Court, the judiciary may be the most important instrument for social, economic and political change. Other organizations and groups, recognizing this, have been far more astute in exploiting judicial action than American business. Perhaps the most active exploiters of the judicial system have been groups ranging in political orientation from “liberal” to the far left. The American Civil Liberties Union is one example. It initiates or intervenes in scores of cases each year, and it files briefs amicus curiae in the Supreme Court in a number of cases during each term of that court. Labor unions, civil rights groups and now the public interest law firms are extremely active in the judicial arena. Their success, often at business' expense, has not been inconsequential. This is a vast area of opportunity for the Chamber, if it is willing to undertake the role of spokesman for American business and if, in turn, business is willing to provide the funds. As with respect to scholars and speakers, the Chamber would need a highly competent staff of lawyers. In special situations it should be authorized to engage, to appear as counsel amicus in the Supreme Court, lawyers of national standing and reputation. The greatest care should be exercised in selecting the cases in which to participate, or the suits to institute. But the opportunity merits the necessary effort.
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Just think what could happen if the chamber had a friend, a really good friend, on the Court.

On January 6, 1972, less than five months after he explained “the vast area of opportunity for the Chamber” were it to engage more actively with the courts, corporate lawyer Lewis Powell became Justice of the Supreme Court Lewis Powell. Three years later, his votes would begin the shredding of the Federal Election Campaign Act, with the
Buckley v. Valeo
decision, a ruling political philosopher John Rawls, a great defender of political fairness and democracy, warned “runs the risk of endorsing the view that fair representation is representation according to the amount of influence effectively exerted.”
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Powell took that risk in 1978 when he stepped forward to write the opinion in the
First National Bank of Boston v. Bellotti
case, which struck down a Massachusetts law that gave corporations broad leeway to spend money on issues “materially affecting” their own operations, but that limited the ability of corporations to spend freely to achieve political goals. The state's attorney
general, Francis X. Bellotti, used the law to challenge efforts by banks to influence the outcome of a 1976 referendum on establishing a graduated tax on the income of individuals.

Bellotti argued that the banks were overstepping their bounds, and lower courts agreed with him. But Powell led a Supreme Court majority that effectively dismissed any debate about whether corporations enjoy the same rights as citizens. “The proper question therefore is not whether corporations ‘have' First Amendment rights and, if so, whether they are coextensive with those of natural persons,” wrote Powell. “Instead, the question must be whether [the statute] abridges expression that the First Amendment was meant to protect. We hold that it does.”
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Asserting the right of corporations to spend as they choose to achieve political ends, the former corporate lawyer who had encouraged corporations to engage in politics explained that the Court majority could

           
find no support in the First or Fourteenth Amendment, or in the decisions of this Court, for the proposition that speech that otherwise would be within the protection of the First Amendment loses that protection simply because its source is a corporation that cannot prove, to the satisfaction of a court, a material effect on its business or property. The “materially affecting” requirement is not an identification of the boundaries of corporate speech etched by the Constitution itself. Rather, it amounts to an impermissible legislative prohibition of speech based on the identity of the interests that spokesmen may represent in public debate over controversial issues and a requirement that the speaker have a sufficiently great interest in the subject to justify communication.
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Powell was making a case for corporate speech that suggested it was protected at least in part because citizens needed input from multinational corporations when deciding whether to fund after-school programs or repair potholes on Main Street. But what if the corporations, with their access to vast amounts of money, did not merely provide information but instead overwhelmed the electoral process in a way that might dictate results?

Powell had an answer for that concern. “Appellee advances a number of arguments in support of his view that these interests are endangered by corporate participation in discussion of a referendum issue,” the justice wrote.

           
They hinge upon the assumption that such participation would exert an undue influence on the outcome of a referendum vote, and—in the end—destroy the
confidence of the people in the democratic process and the integrity of government. According to appellee, corporations are wealthy and powerful and their views may drown out other points of view. If appellee's arguments were supported by record or legislative findings that corporate advocacy threatened imminently to undermine democratic processes, thereby denigrating rather than serving First Amendment interests, these arguments would merit our consideration. . . . But there has been no showing that the relative voice of corporations has been overwhelming or even significant in influencing referenda in Massachusetts, or that there has been any threat to the confidence of the citizenry in government.
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Three decades later, the people themselves say that they have lost confidence in the democratic process and the integrity of government. This view emerges in poll after poll, in election results that evidence a desperation for fundamental change, and in rapid growth of popular movements on the right and the left. Citizens are taking to the streets to express frustration and fury with a system in which political corruption plays a “major role” in the nation's economic distress, according to 82 percent of Americans surveyed. Long before the rise of the Occupy Wall Street movement, 85 percent of voters surveyed told Hart Research pollsters that corporations have too much influence over the political process. In that same 2010 survey, 93 percent of Americans questioned said average citizens have too little influence.
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Yet far from embracing Powell's suggestion that threats to democracy would merit reconsideration of the role of corporate money in politics, the Supreme Court has moved beyond Powell and far, far beyond William Rehnquist, who in his 1978 dissent from the
Bellotti
decision wrote:

           
The question presented today, whether business corporations have a constitutionally protected liberty to engage in political activities, has never been squarely addressed by any previous decision of this Court. However, the General Court of the Commonwealth of Massachusetts, the Congress of the United States, and the legislatures of 30 other States of this Republic have considered the matter, and have concluded that restrictions upon the political activity of business corporations are both politically desirable and constitutionally permissible. The judgment of such a broad consensus of governmental bodies expressed over a period of many decades is entitled to considerable deference from this Court. I think it quite probable that their judgment may properly be reconciled with our controlling precedents, but I am certain that under my views of the limited application of the
First Amendment to the States, which I share with the two immediately preceding occupants of my seat on the Court, but not with my present colleagues, the judgment of the Supreme Judicial Court of Massachusetts should be affirmed.
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“Early in our history,” noted Rehnquist, “Mr. Chief Justice Marshall described the status of a corporation in the eyes of federal law: ‘A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law. Being the mere creature of law, it possesses only those properties which the charter of creation confers upon it, either expressly, or as incidental to its very existence. These are such as are supposed best calculated to effect the object for which it was created.'”

Rehnquist held to the view that “it cannot be disputed that the mere creation of a corporation does not invest it with all the liberties enjoyed by natural persons,” and he argued further that limiting the role corporations play in politics is a desirable goal. “A State grants to a business corporation the blessings of potentially perpetual life and limited liability to enhance its efficiency as an economic entity. It might reasonably be concluded that those properties, so beneficial in the economic sphere, pose special dangers in the political sphere,” explained Rehnquist.

           
Furthermore, it might be argued that liberties of political expression are not at all necessary to effectuate the purposes for which States permit commercial corporations to exist. So long as the Judicial Branches of the State and Federal Governments remain open to protect the corporation's interest in its property, it has no need, though it may have the desire, to petition the political branches for similar protection. Indeed, the States might reasonably fear that the corporation would use its economic power to obtain further benefits beyond those already bestowed. I would think that any particular form of organization upon which the State confers special privileges or immunities different from those of natural persons would be subject to like regulation, whether the organization is a labor union, a partnership, a trade association, or a corporation.
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Rehnquist was an old-school conservative, as opposed to a corporatist, and we recount his thinking at length because it is vital to recognize that there is no simple liberal-versus-conservative split over campaign-finance issues. The debate over how to control or unleash the Money Power is not a battle of ideas. The calculus, as Texas populist Jim Hightower told us, “isn't about left versus right; it's about top versus bottom.” Rehnquist, with his roots in Barry
Goldwater's Arizona and Barry Goldwater's movement, believed that right-wing ideas would prevail in a fair fight, and we hope there are still many conservatives like him.
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Rehnquist was a flawed champion, to be sure. But after his nomination by Ronald Reagan in 1986 to serve as the sixteenth chief justice of the U.S. Supreme Court, he would maintain an imperfect but real balance when it came to the regulation of campaign spending. Powell, who left the High Court in 1987, had succeeded with the
Bellotti
decision in extending the reach of corporations into the political sphere. But
Bellotti
dealt with a narrow question of spending on referendums, and despite Powell's attempt to define the issue more broadly, there was a caution during the Rehnquist era about reopening the broader question of whether money really equals speech.

With the replacement of Rehnquist in 2005 by John Roberts, the balance was tipped toward Wall Street. Roberts, a corporate lawyer with a background as a hyperideological member of the steering committee of the Washington, DC, chapter of the conservative Federalist Society, was a committed partisan who had traveled to Tallahassee, Florida, following the 2000 election to advise Governor Jeb Bush on how to manage the recount process that would eventually make Jeb's brother the president. Roberts was appointed by George W. Bush first to the District of Columbia Circuit of the United States Court of Appeals in 2003 and then two years later to the most powerful judicial post in the land.
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When it came to questions of corporations and politics, Roberts would not follow in Rehnquist's tradition. Roberts was a Lewis Powell man, and then some. “Almost from the moment Chief Justice John G. Roberts Jr. joined the bench five years ago,” observed the
Washington Post
in 2010, “the court's conservatives have acted systematically on their deep skepticism of campaign spending restrictions. They have repeatedly questioned the ability of Congress to regulate the role of wealth and special interest involvement in elections without offending the First Amendment guarantee of unfettered political speech.”
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Under Roberts's leadership, the High Court would implement what the
Post
described as “game-changing decisions on campaign finance reform.”
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On paper, and in practice, that is true. Roberts's manipulations to position the Court as not merely a defender but also a champion of corporate influence in
politics were every bit as unseemly as Powell's, and far more aggressive. They began immediately with interventions such as the Court's ruling in the 2007 case of
Federal Election Commission v. Wisconsin Right to Life
, which Nate Persily, director of the Center for Law and Politics at Columbia Law School, argues with some validity “opened [the] floodgates” by eliminating restrictions on the airing of so-called issue ads during the peak campaigning seasons before primary and general elections.
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It became clear very early in Roberts's tenure as chief justice that he had his eye out for the case that would give the Court an opportunity to overturn any remaining rules governing advertising by groups that—because they were supposedly commenting on issues rather than campaigns—could steer corporate money into the thick of election fights. And, ultimately, to do a whole lot more.