LIBERAL GOVERNMENT AND THE CORPORATE PERSON

Abstract

This article focuses on corporate personhood, the controversial argument, advanced particularly in the United States, that corporations are persons within the scope of the law and are therefore endowed with rights. Though often examined as a causal factor in the development of modern corporate power, in this article I argue that corporate personhood is more useful as a tool for understanding the problematic of liberalism and the transformations associated with the definition of persons under the liberal rule of law. To explain why, I focus on debates about corporate personhood in prominent legal and philosophical texts from the turn of the twentieth century. Highlighting the contingent production of ideas about corporate personhood, I show the ways that writers within the U.S. context rethought corporate personhood, which was traditionally a discourse about sovereign power, in terms of liberal rights as a way of promoting economic forms of government. By focusing on the problematic, we see the ways that corporate capitalism was never simply a set of economic relations, but also a way of organizing, ordering and intervening in life.

Keywords:

• corporations
• personhood
• liberalism
• problematic
• economic government
• sovereignty

ACKNOWLEDGEMENTS

An earlier version of this article was presented at the Hurst Summer Institute in Legal History. I would like to thank the participants of the Institute, Barbara Welke, Vinay Gidwani, Eric Sheppard, and the anonymous reviewers for their comments.

Notes

1. On the British context see Hirst (1979) and Ireland (1996).

2. There is a voluminous literature on CSR and CC. For a useful introduction see Crane et al. (2008). On corporate accountability and international human rights law, see the activities of John Ruggie, who was appointed in 2005 as UN Special Representative on human rights and transnational corporations. Publications are available at http://www.business-humanrights.org/SpecialRepPortal/Home

3. For a critique of these theories see Ireland (2003).

4. Chief Justice John Marshall of the U.S. Supreme Court defined the corporation in the famous case of Dartmouth College v. Woodward (17 U.S. 636) as ‘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.’

5. On corporate opposition of the 1820s see Maier (1993). On general incorporation see Horwitz (1992), ch. 3); Roy (1997); Evans (1948).

6. Bank of United States v . Deveaux 9 U.S. 61 (1809).

7. Rundle v. Delaware and Raritan Canal Co 55 U.S. 80 (1852).

8. Marshall v. Baltimore and Ohio Ry 57 U.S. 314 (1854). For a fuller account of this transition see Henderson (1918), pp. 60–61.

9. Santa Clara was the most prominent of a series of tax cases that came before the Ninth Circuit Court in the aftermath of the Civil War.

10. The interpretation that Santa Clara gave constitutional rights to corporations as autonomous entities was part of a Progressive Era narrative about how the law promoted corporate capitalism. Early twentieth century historians, like Charles and Mary Beard (1927), identified a ‘conspiracy’ in which the drafters of the Fourteenth Amendment used the term ‘persons’ intentionally to protect corporate property. This interpretation was refuted by Howard Jay Graham (1968) and, more recently, by Morton Horwitz (1992), who suggested that Santa Clara was built on ‘aggregate theories’ of corporate personhood. Horwitz argued that it was another quarter century before the natural entity theory, which held that corporations were real people and separate from the property rights of the investors, was recognized by the courts.

11. In addition to the major legal treatises on corporate law, which all considered issues of personhood, a steady flow of books and articles on the subject had begun to appear by the 1890s. Ernst Freund's Legal Nature of Corporations (1897) is commonly cited as an important early text, and Horwitz (1992) argues that John Dewey's aforementioned 1926 piece marked the end of interest in the subject. In fact, corporate personality continued to receive attention through the 1930s with the publication of English language monographs on the topic by Frederick Hallis (1930) and Alexander Nékám (1938).

12. On the German historical context see Maitland's introduction in Gierke (1958) and Harris (2007). On the relation between Gierke and Hegel see George Heiman's essay ‘State and Law’ in Gierke (1977).

13. Railroad Tax Cases; County of San Mateo v. Southern Pacific R. Co 13 F. 744 (C.C.D. Cal. 1882).

14. Foucault (2003) emphasizes this aspect of Sièyes famous pamphlet, ‘What is the third estate?’, in his lecture from 10 March 1976.

15. Foucault (2003) broached this paradox in his lecture on 14 January 1976: ‘We now find ourselves in a situation where the only existing and apparently solid recourse we have against the usurpations of disciplinary mechanics and against the rise of a power that is bound up with scientific knowledge is precisely a recourse or a return to a right that is organized around sovereignty, or that is articulated on that old principle … having recourse to sovereignty against discipline will not enable us to limit the effects of disciplinary power’ (p. 39).