Corporate What?! You Gotta Be Kidding!

by Al Falafal

In September 2008 I wrote an essay about “The seismic activity rocking World financial markets” as the inevitable outcome of that garden path down which we had been lured nearly three decades prior. 28 years later after we installed Corporate America's Henchman-in-Chief, Ronald Reagan, as President the ultimate promise of “free market” deregulation had been brought fully to term by the outgoing Bush/Cheney Administration.

I had to be fair, noting that the path Corporate America had us treading was actually blazed much earlier than the Reagan Era. In fact, you can trace the rise of corporate domination of American Society to a 19th Century lawsuit taken up by the U.S. Supreme Court which has often been cited - wrongly, but persuasively - as the basis for corporations right to run amok, free of nearly any governmental authority to control them.

It was the 1886 case of Santa Clara County vs. Southern Pacific Railroad that was purported to be a precedent-setting decision that granted "personhood" to American corporations. Reagan's economic and political voodoo was entirely based on the assumed rights and freedoms that they firmly assert were granted to non-human entities for the first time in history by the Court's ruling in that case.

These rights would include the same Constitutional freedoms of speech and association to which only We The People - living, breathing human citizens - were previously entitled.

On the precedent set by the Santa Clara County case, corporate lawyers argue that the Bill of Rights’ protection of free speech, and of redressing the government extend specifically to that speech and money which all “persons” are free to use to influence political campaigns for representative office. As we know, this precedent was upheld again this week in the devastating ruling handed down in Citizens United v Federal Elections Commission.

But don't we all know by now that that precedent was a total shameless lie? Didn't the Supreme Court know that it's a lie?

The truth is that nowhere in the formal Southern Pacific Railroad decision is the concept of “corporate personhood” mentioned. Not a word. Contrary to generally accepted beliefs and lessons still taught in law school Corporate Law Classes today, and obviously taken as fact by the current Supremes, the Court most certainly did NOT establish corporate personhood in that case or any other - up to this day.

The only place where the concept of “personhood” is referenced in that 1886 decision in a court record "headnote" attached to the case. A “headnote” has no precedential status whatsoever. It is far less relevant, binding or persuasive than a judicial dissent, which is at least penned by a bona fide member of the Court.

Rather than any one of the sitting Justices, It was a hired Court reporter, by the name of J.C. Bancroft Davis, who wrote the headnote for the case of Santa Clara County declaring, on the basis of NOTHING that corporations are henceforth entitled to the privileges of "personhood."

And who was this Davis guy? It just so happens that he was a former railroad executive, clerking for the Court at the time of this ruling! A former RAILROAD EXECUTIVE! See any red flags yet?

Davis’ totally non-authoritative, layman’s case summary begins with this sentence: 'The defendant Corporations are persons within the intent of the clause in section 1 of the Fourteen Amendment to the Constitution of the United States, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws.'"

The current Supremes apparently read no further than the headnote in this ruling, which is to say they did not read the ruling at all. Apparently they only read the part that was totally made up by a person with a huge bias and interest in the case - a former RAILROAD EXECUTIVE!

This persuasive revelation was brought to light most famously by author Thom Hartmann in his 2002 book, Unequal Protection: the Rise of Corporate Dominance and the Theft of Human Rights. Hartmann, a prolific author and scholar of the history and textual analysis of the United States Constitution points out that any suggestion that corporate personhood was “provided” by the ruling in Santa Clara County is a gross and deadly mistake that has naturally had devastating consequences, the worst of which we may be experiencing today.

It is vitally important to distinguish what a “headnote” is and is not. What it is is a summary description of a Court decision, written into the casebook by a court reporter. It is not in any way part of the Court’s opinion and holds not an ounce of weight as legal precedent - a fundamental lesson learned on the first day in Paralegal Studies 101.

A “headnote” is similar to an editor’s “abstract” in a scientific journal or a research grant proposal or the executive summary in a business text. Because they are not products of the Court itself, however, headnotes carry no inkling of legal authority; they can never establish precedent in law and should have no real bearing on our lives.

To argue that corporate personhood was supposedly established by the U.S. Supreme Court in 1886, Hartmann says, is simply and unequivocally illegitimate.

John Chandler Bancroft Davis, the Court reporter in question, knew exactly what he was doing. He was a graduate of Harvard Law School. And Thom Hartmann knows of what he speaks: 12 books authored by Davis exist mostly as original editions in his personal library. The books reveal Davis’s close alliance with the railroad industry, and they support Hartmann’s implication that Davis injected the personhood statement deliberately, to achieve by deceit what corporations had tried but failed to achieve in litigation before then. It was a brilliant move - install a corporate mole in the US Supreme Court, preferably in a position where he can re-write any legislation that did not favor the industry! But you don't want to over use this advantage. No. It's best to be strategic. Don't do anything that would draw attention but strike decisively when the opportunity presents itself.

Hartmann admits that we cannot determine what was in Davis’ mind on composing the misleading headnote as he left no direct evidence that would implicate him in the distortion. Through the ensuing decades, however, corporate interests have successfully exploited this erroneous interpretation of the record of that ruling as the basis for consideration of “equality” between individual tax-paying persons and U. S. corporations who, coincidentally, are also subject to taxes. Thankfully corporations have never sought to have a right to vote. This concept was still taught as part of the underlying determination of how taxes are levied when I studied tax law at Wharton in the 1990s and in my Corporate Law classes that were part of my Paralegal Studies degree program.

In the last days of the American Civil War, President Abraham Lincoln wrote to his friend Colonel William F. Elkins, 'We may congratulate ourselves that this cruel war is nearing its end. It has cost a vast amount of treasure and blood. The best blood of the flower of American youth has been freely offered upon our country's altar that the nation might live. It has indeed been a trying hour for the Republic; but I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country.'

'As a result of the war, corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed. I feel at this moment more anxiety than ever before, even in the midst of war. God grant that my suspicions may prove groundless.'

Lincoln's suspicions were prescient. "[Thomas] Jefferson and [James] Madison proposed an 11th Amendment to the Constitution that would 'ban monopolies in commerce,' making it illegal for corporations to own other corporations, banning them from giving money to politicians or trying to influence elections in any way, restricting corporations to a single business purpose, limiting the lifetime of a corporation to something roughly similar to that of productive humans (20 to 40 years back then), and requiring that the first purpose for which all corporations were created be 'to serve the public good.'"

How do you think that worked out? Look around...

Here we are. In the first few weeks of 2010 the fate of our democracy is sealed. Thanks, Surpreme Court. Is this the change we needed? The only thing left is for those huge corporations to bid against each other for absolute control of the government.

If Corporations are persons in this country, would I get the death penalty if I murdered one?



See: Gravel Grab: Impartiality, Accountability and the War over the Courts