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Behind the corporate mask

May 26, 2014

If poems, as W.B. Yeats suggests, are masks–ways to act while wearing a different face than your natural one–then they have something in common with corporations. Perhaps this is why I find this legal argument so fascinating. Well, that, and there’s just something fascinating about legal reasoning in general–it’s half metaphysics, half citation of precedent. The fine details are worth reading through, but here’s the takeaway:

It is true that society treats corporations as legally distinct persons for some purposes, but this is a pragmatic choice rather than a normative judgment that human concerns do not apply to such firms. Corporations are just means by which groups of people pursue common purposes, and acknowledging the exercise of religion by for-profit corporations is by no means a category mistake. Nor, given that corporations can be formed for “any lawful purpose,” do shareholders violate some social compact by accepting the benefits of the corporate form while pursuing both profits and religious values. Of course, granting religious exemptions from otherwise applicable laws raises the risk of opportunism and can undermine important governmental policies. These risks are present with natural persons as well, however. RFRA deals with these concerns not by narrowing the definition of “person,” but instead by scrutinizing only those burdens on religious exercise that are substantial and allowing compelling interests to justify such burdens in appropriate cases. Simply put, corporate law provides no reason for excluding for-profit corporations from RFRA.

From the perspective of an interested layman, this sounds right to me. But from the perspective of a would-be philosopher, and a fan of G.E.M. Anscombe’s book Intention, I think it actually gets something important wrong: while certainly there’s no “normative judgment” involved in corporate personhood, there’s also no reason to insist on the language of “pragmatic choice,” “legal fiction,” “just means,” etc, any more than there’s reason to insist on such language when talking about human beings: after all, the legal personhood of human beings is also just a pragmatic choice, “personhood” being a specific legal mechanism we’ve decided on for enforcing laws governing relations between various kinds of entities, human and non.

If we step out of the legal framework and look at the reality it’s meant to capture, we see, to be sure, that corporations are not natural persons; they are artificial. But this does not make them somehow unreal, any more than such man-made things as tools, poems, friendships, or communities are unreal. The language of reality and unreality serves an honorific purpose, not a philosophical one–that is, it plays no role in the argument, it’s just meant to remind us that corporations are less, well, corporeal than human beings–a fact no one has forgotten, and which is rarely relevant to questions of how they should be treated. It matters when it comes to, for example, murder, because it’s hard to see what it would mean to murder a corporation. It does not matter for theft, not because we’ve specifically determined corporations to be the kinds of things that can be stolen from, but because by calling them “persons,” as it is natural to do, we’ve taken for granted that person-related concepts with clear application to corporations can be so applied.

We can see that “reality” is irrelevant when we render the argument out of legalese into philosophese:

  1. Corporations are called persons. (It is unclear how else we would talk about them.)
  2. “Person” is a genus, of which “human being” is the paradigmatic species. (It is unclear how else we would give the word meaning.)
  3. Human beings are defined as the union of a specific kind of body and a specific kind of intentionality. (They are the religious, political, ethical, rational, language-using, tool-using, laughing, etc, animal.)
  4. So to call a corporation a person is to say that it is like a human being except for certain specified differentia regarding the type of body and the type of intentionality. (From 1, 2, 3)
  5. Corporations, when made up of religiously motivated persons, can have religious intentions. (Incorporated churches and religious schools and universities have such intentions.)
  6. A designation as “for-profit” places no restrictions on a person’s possible intentions. (“For-profit” means nothing more than “has not forsworn profit.”)
  7. So nothing prevents for-profit corporations from having religious intentions just as human beings do. (From  4, 5, 6)
  8. Persons should be granted religious freedom because they can have religious intentions that should not be restricted without good cause. (Government ought to make possible the pursuit of eudaimonia.)
  9. So for-profit corporations should be granted religious freedom. (From 7, 8)

Premises 2, 3, 5, and 8 seem to me quite straightforward, as do inferences 4, 7, and 9; I expect premises 1 and 6 to be the only controversial ones. In a legal context, both are questions of fact, and the linked article does a good job demonstrating them. In a philosophical context, both are questions of grammar.

We should admit 1 because corporations are essentially associations of persons united by common intentional actions, rather than just commons interests (we call such things communities). We have to call them persons because there is nothing else to call them; to refuse to call them persons is to refuse to talk about them. We can, of course, do so, and talk only about individuals and their actions, but if we do so it becomes nonsense to pass laws regulating collective actions. If you want to regulate the actions of a group, you have to talk about the group as the kind of thing that can take action.

We should admit 6 because it’s common sense. It would be bizarre to think that whenever a human being enters into commercial activity he does so without religious intentions, and it would be totalitarian to think that whenever a human being enters into commercial activity he thereby gives up his right to exercise those religious intentions and has to act “as if” he were a profit-seeking robot.

A strange consequence of this argument is the suggestion that corporations can pursue happiness, or at least eudaimonia. I admit that this is not our common way of speaking. But it doesn’t mean that corporations can experience physical pleasure; of course they can’t. Rather it means that there is such a thing as a corporation leading a good life; that the goal of a corporation is to seek that good life; and that a corporation is no more likely than a human being to define the good life in terms of maximizing wealth. Corporate eudaimonia may mean maximizing the eudaimonia of its shareholders, but I am suspicious of this claim also. It is probably no easier to define than the human variety.

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8 Comments leave one →
  1. Nick Olson permalink
    May 27, 2014 12:34 am

    Simmons, you really have a knack for legal argument. It shouldn’t be surprising, as philosophy and law go very hand-in-hand. It’d be cool if you ever pursued a JD, since philosophy and law is a growing academic dual-discipline, especially with respect to contract law.

    I’d only point out that (in my quick read) you seem to gloss over the jump from “person” singular and “persons” plural. E.g. we can probably all accept that a “person” can have religious beliefs. And we can probably all accept that the “persons” in church on any given Sunday, each have individual religious intentions. But that’s not the same as saying the congregation as a whole has a religious intention.

    Since I’m bad at philosophy, it’s maybe comparable to the legal question of whether “Congress” can have “intention” that can be useful in interpreting laws that Congress passes. For example, Chris Dodd can have intentions in voting for the Dodd Frank Act, as can every other senator who voted for it, but that does not mean that the senate, taken as one corpus, had an “intention.” If you ask Antonin Scalia, he would say Congress does not have “intention”; only individual congressmen have intention (but they did not pass the law, thus their comments to the media or congressional notes are worthless in interpreting how a statute should be applied).

    And just as “Congress” may or may not have “intentions,” “Corporations” may or may not have religious intentions, depending on whether you’re referring to the relevant persons who make up the corporation in their individual capacity (e.g. the owners of the company, or relevant decisionmakers, e.g. the NYTimes Editorial Board that votes over which presidential candidate to support) or the corporation as distinct from its stakeholders and constitutents.

    Hopefully that makes some sense and is germane to your original post. And again I’d reiterate that these are the sorts of things you could explore in an academic career should you ever decide a JD is worth the time and effort and money.

  2. May 27, 2014 7:56 am

    You’re completely right. I meant for this to be part of the argument, but it got sort of glossed over. My claim is, insofar as we can talk about collectives, we can talk about collection actions; and insofar as we can talk about collective actions, we can talk about collective intentions. If collective intentions don’t “really” exist, fine, that means collectives don’t either; but it sounds strange, I think, to insist that “collectives don’t actually exist, they’re just collections of actual individuals!” If collectives aren’t real, then don’t talk about them at all, just talk about the individuals.

    Actions and intentions are necessarily linked because without intentions, actions are just events. We could, to be sure, treat the “actions” of corporations as “events,” for legal purposes; but you can’t regulate stand-alone events. You can’t regulate the weather. To regulate corporate events is really to regulate the actions of the persons behind the corporation, just like to regulate the firing of guns is really to regulate the actions of persons who might use guns.

    There’s still an issue I didn’t address regarding what *kind* of intentions groups can have. Perhaps corporations can’t have religious intentions because religious actions are necessarily private, and corporations can only act publicly. But why think religious actions are necessarily private?

    I think the issue about whether Congress can have an intention is potentially misleading. There’s the question of whether Congress passing laws is event-like or action-like; I think it’s action-like. But this has to be separated from the question of whether it attaches a specific intention to the words of the laws it passes. It might be that it does not. Its intention might well be “these words, however future interpreters interpret them, are now law.”

    But note that even when it does this, it intends the marks-on-a-page it puts out to be interpreted as English words. If Congress is the kind of thing that can intend English sentences, rather than just produce marks-on-a-page, it has to be the kind of thing that can perform actions.

  3. May 27, 2014 7:59 am

    Note: on second thought, you actually can regulate stand-alone events; for example, we impound stray dogs because they’re a public nuisance. But if there were a religion whose exercise involved letting stray dogs wander around, and whose exercise the impounding of stray dogs interfered with, then the dog-collection law would have to survive strict scrutiny: does the purpose it serves outweigh the infringement of free religious exercise? As this is true even though the original law did not seem to regulate action at all.

  4. CJ Wolfe permalink
    June 6, 2014 4:06 pm

    Really interesting stuff here. I think you’re completely right when you say “a corporation is no more likely than a human being to define the good life in terms of maximizing wealth.” The corporate personhood issue really is an interesting one for philosophy, but I think less so legally. Although alot of people say the notion of corporate personhood was invented with the recent “Citizens United” case, granting allowing free speech rights to unions and corporations during elections, it has a MUCH older pedigree. It has roots all the way back to British Common law, but one of the first important appearances in our Constitutional law was the Great Chief Justice John Marshall’s ruling in Dartmouth College (1812). In it Marshall said that the properties of a Corporation are determined by the object it pursues (confirming your point that the object of a corporation is not necessarily profit maximization):
    “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 its 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. Among the most important are immortality, and, if the expression may be allowed, individuality — properties by which a perpetual succession of many persons are considered as the same, and may act as a single individual. They enable a corporation to manage its own affairs and to hold property without the perplexing intricacies, the hazardous and endless necessity, of perpetual conveyances for the purpose of transmitting it from hand to hand. It is chiefly for the purpose of clothing bodies of men, in succession, with these qualities and capacities that corporations were invented, and are in use. By these means, a perpetual succession of individuals are capable of acting for the promotion of the particular object like one immortal being. But this being does not share in the civil government of the country, unless that be the purpose for which it was created. Its immortality no more confers on it political power, or a political character, than immortality would confer such power or character on a natural person. It is no more a state instrument than a natural person exercising the same powers would be.”

  5. June 9, 2014 2:20 pm

    I think you’re right that it’s legally not that complicated. What I find strange is how, even though it’s pretty simple legally, it’s so hotly debated politically. It seems like something of a red herring. When people get mad about corporations doing something, they usually would get mad about human persons doing those things through unincorporated partnerships as well.

    Put differently, when people claim to disagree with premise 1 of my above argument, it’s usually because they actually disagree with premise 8, but think it would be easier to mount an argument against the not-entirely-intuitive truth that corporations are persons than against something as highly prized as religious freedom. Same with most other contested issues (corporate free speech, etc).

  6. June 12, 2014 8:55 am

    Incidentally, one legal argument that people seem to find plausible but that makes no sense to me is the following: “The Court could hold that for-profit corporations qualify as persons for purposes of RFRA, but limit its holding to small, privately held firms like Hobby Lobby.” (See http://berkleycenter.georgetown.edu/rfp/blog/hobby-lobby-potential-arguments-from-the-bench-and-their-implications-for-religious-freedom/responses/a-way-out-of-the-for-profit-conundrum).

    People find this solution intuitive but it seems likely clear nonsense. Even if we find a way to cleanly separate religion-capable corporations from non-religion-capable ones on the basis of its shareholder distribution (which seems unlikely–there’s a continuum here), what is the actual reason why large, diffuse corporations can’t have religious intentions?

    Sure, it’s unlikely, for the same reason it’s unlikely that someone who sways like a reed in the face of public opinion actually has any strongly-held religious beliefs. But that doesn’t in principle prevent politicians from actually being religious. There could easily be, for example, a large, diffusely-held corporation with religious intentions written into its charter; since this corporation didn’t seek profit about all else, its shareholders would tend to be limited to people who agreed with its religious intentions, but there would be no rule ensuring that this happened. Now imagine it’s not written into the charter, but everyone–shareholders, employees, outsiders–acts as if it is. Why would the first kind have religious intentions, but the second not?

    This is just another example of how corporations mess with people’s intuitions. The fear seems to be that there would be “no way to tell” whether a large corporation’s declared religious intentions were sincere, and so if we allow they to have such intentions, they’ll immediately take advantage. But corporations present a public face just like everyone else. We would adjudicate whether the intentions were sincere the same way we do when ordinary citizens claim special exemption: look to see whether what they do bears out what they say.

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  1. Congressional intentions | Ironical Coincidings
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