There are no fiscal impacts stemming from the adoption of this resolution.
REASONS FOR RECOMMENDATION
The United States Constitution and the Bill of Rights are intended to protect the rights of human beings, not corporations. While corporations can and do make important contributions to society, it is important to clarify that they are not entitled to the same constitutional rights and protections as natural persons. The traditional and necessary rights and powers of corporations, such as ownership of property, ability to enter into legal transactions, ability of many persons to act as one, limited liability, perpetual life, and many others, are provided for by State law and do not require the creation of corporate rights in the United States Constitution.
The right to free speech is a fundamental freedom and unalienable right. Free and fair elections are essential to democracy and effective self-governance. But our form of governance has become increasingly entangled with corporations influencing public discourse and elections.
Efforts toward building a vibrant democracy that is genuinely accountable to the people, and not corporate interests, are widespread. One leading example is the Move to Amend coalition, which is a non-partisan group of organizations and individuals that are working together to end corporate personhood and demand real democracy, including by encouraging State and local governments to press for a constitutional fix.
This referral is asking the Board to consider adoption of a resolution that demonstrates the County of Santa Clara’s support for an amendment to the United States Constitution establishing that money is not speech, campaign contributions and expenditures may be reasonably limited and regulated by Congress and the States without violating the Constitution, and only natural persons have constitutional rights.
In Buckley v. Valeo, 424 U.S. 1 (1976), the United States Supreme Court held that real or perceived corruption justified limits on contributions to political candidates, but rejected other fundamental interests that the County of Santa Clara finds compelling, such as creating a level playing field for political candidates and ensuring that all citizens, regardless of wealth, have an opportunity to have their political views heard. The Buckley case overturned limits on independent expenditures in part because it found that the corruption or perception of corruption rationale was only applicable to direct contributions to candidates.
In Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990), the United States Supreme Court recognized the threat to a republican form of government posed by “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” and upheld limits on independent expenditures by corporations.
The United States Supreme Court overturned the Austin decision in Citizens United v. Federal Election Commission, 558 U.S. 310 (2010), which recognized and protected the First Amendment political speech rights of corporations, and effectively allows unlimited corporate spending to influence elections, candidate selection, policy decisions, and public debate.
Since then, approximately 20 States and hundreds of local governments throughout the country have passed resolutions or ballot initiatives that call for overturning the Citizens United decision, a constitutional amendment establishing that money is not speech and/or that corporations do not have constitutional rights or similar reforms.
Various district, appellate, and United States Supreme Court cases also highlight that the will of the People has been frustrated by the granting of constitutional rights to corporations:
In First National Bank of Boston v. Bellotti, 435 U.S. 765 (1978), the United States Supreme Court held that corporations have the same First Amendment free speech rights as individuals and struck down a State ban on corporations spending money to influence referendums.
In International Dairy Foods Association v. Amestoy, 92 F.3d 67 (2d Cir. 1996), an appellate court held that a Vermont statute requiring all dairy products from cows given the synthetic growth hormone rBST carry a certain warning label infringed on corporations’ First Amendment free speech right not to speak.
In Lorillard Tobacco Co. v. Reilly, 533 U.S. 525 (2001), the United States Supreme Court held, among other things, that Massachusetts State regulations prohibiting outdoor advertising of smokeless tobacco or cigars within 1,000 feet of a school or playground violated corporations’ First Amendment commercial free speech rights.
In Burwell v. Hobby Lobby Stores, Inc., 573 U.S. 682 (2014), the United Supreme Court held that, because a corporation is a person under the Religious Freedom Restoration Act of 1993, corporations generally can opt out of laws they determine are incompatible with their religious beliefs, such as those requiring the provision of contraceptive services as part of employer health care plans.
DRAFT RESOLUTION – Constitutional Amendment to Address Campaign Spending, Corporate Personhood (DOCX)