Corporate Personality and Human Commodification

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[*100] My purpose in this essay is to explore the doctrine of “corporate personality,” to deconstruct the metaphor of legal “being,” to reveal it “as an intersection of competing discourses… as a point of fracture in which different systems of signs are transposed, translated and articulated” (Goodrich 1986, 220).

The concept that a corporation is a “person” is the legal core of corporate power. When the U.S. Supreme Court overturned New Hampshire’s attempt to turn Dartmouth College into a public institution (Dartmouth College v. Woodward, 17 U.S. Reports 518 [1819]), the Court subordinated a state legislature to an “artificial being”: the college corporation. The Court held that a charter from the British Crown creating the college was a contract protected from legislative impairment by the federal constitution. The Court said that the college corporation provided for the maintenance of property rights by “a perpetual succession of individuals… capable of acting… like one immortal being.” The Court’s comment that “[i]ts immortality no more confers on it political power… than immortality would confer such power… on a natural person” denied human experience as it postulated an artificial world of legal “being.”

Two Approaches to Legal Personality

By the late nineteenth century, corporations had become major institutions. Their legal conceptualization as “artificial” hardly fitted the reality of their power. Large manufacturing corporations and railroads rivaled governments. Corporate legal battles were not limited to preservation of their charters but extended to ever wider attempts to deploy property and exercise coercive force. Assertions of corporate power independent of the state and challenging the terms of corporate legal existence “positively traumatized legal thinking” and created “a crisis of legal imagination” at the turn of the century (Mark 1987, 1445).

Frederic William Maitland pointed out in 1900 that “in the second half of the nineteenth century corporate groups of the most various sorts have been multiplying all the world over at a rate that far outstrips the increase of natural persons, and a large share of all our newest law is law concerning corporations.” He went on to say that “something not unworthy of philosophic discussion would seem to lie in this quarter: either some deep-set truth which is always bearing fruit, or else a surprisingly stable product of mankind’s propensity to feign” (1958, xii).

Maitland’s comments appeared in the introduction to his translation of Otto Gierke’s history of political theory in the Middle Ages. Gierke’s presentation of Germanic concepts of “organic” group life offered the possibility of a “deep-set truth” that corporate entities exist prior to and independent of the state. Far from being “artificial” creatures of the state, corporations might be seen as “real” legal persons deriving their powers and legitimacy from their own internal processes as human “fellowships” or associations.

Maitland suggested that this Germanic concept of “real” corporate personality might legitimize the economic and political reality that was emerging in America and England. It would allow law to take the side of the corporation against the state, [*101] not simply where the state had already provided for specific protections but in a generalized way, on behalf of self-directed corporate autonomy, a form of group sovereignty. As the source of their own legitimacy, “real” legal “persons” would be in a position to negotiate with the state. “Fictional” legal persons, on the other hand, were dependent on state authority for their existence and legitimacy. They were subsumed in state sovereignty. Their existence was entirely “feigned” by the law.

The “fiction” concept of corporate personality claims a Roman pedigree. Gierke refers to a tradition snaking back through the Middle Ages to Pope Innocent IV (pontificate 1243-54) who relied on phrases in Justinian’s Digest to declare that church “bodies” could own property as “persons.” The difference between the Roman and German traditions, as Maitland pointed out, is between an abstract institution existing only in contemplation of law and a “living group” existing as a sovereign expression of its members.

Maitland’s translation brought Gierke’s vision of the “organic” viewpoint of corporate associations to English-speaking jurists, who were looking for an alternative to the “fiction” conception to rationalize the overwhelming economic and political power being marshaled by corporations. This “organic” view, though it did not triumph in its own right in American law, fueled debate about whether corporations depend on the state or are directly legitimized by a human right of free association.

The jurisprudential debate came to its “crisis” as corporate power intensified throughout the last half of the nineteenth century and political opposition emerged from Populist legislatures. Populists enacted a variety of legal obstacles to corporate business. “States’ rights” were asserted against “foreign” corporations, license fees set for doing corporate business within a state, bond requirements established, and other measures taken that, from a national corporate point of view, threatened economic “balkanization” (Graham 1955, 166).

Corporations challenged Populist restrictions with a barrage of litigation claiming equal protection and due process rights under the Fourteenth Amendment. Corporate lawyers aimed at stretching the federal Constitution to create a national market free from state regulation. U.S. Supreme Court Justice Hugo Black once pointed out that “of the cases in this Court in which the Fourteenth Amendment was applied during the first fifty years after its adoption, less than one-half of one percent invoked it in protection of the negro race, and more than fifty percent asked that its benefits be extended to corporations” (Connecticut General Co. v. Johnson, 303 U.S. Reports at 90 [1938]).

The railroad provisions of California’s Constitution of 1879 were a high-water mark of anticorporate Populist law. These included an elected Railroad Commission and State Board of Tax Equalization, and a provision prohibiting deduction of railroad mortgage costs for property tax purposes. This provision aimed at distinguishing between mortgages for personal property (e.g., homes) and mortgages for business capitalization. Targeting of railroad mortgages was explained by reference to the fact that “railroads, unlike other property, were mortgaged for more than cost, yet still paid handsome dividends” (Graham 1955, 180). The activities of the Board [*102] of Tax Equalization applying the mortgage provision led to confrontation in federal court with the Southern Pacific Railroad.

The ensuing litigation, Santa Clara County v. Southern Pacific Railroad (118 U.S. Reports 394 [1886]), resulted in a clear victory for corporate partisans. The U.S. Supreme Court declared the railroad to be a “person” within the meaning of the Fourteenth Amendment, a much broader protection than provided to Dartmouth College. Fourteenth Amendment recognition of corporate personality provided corporations with a generalized freedom to use property in opposition to state government restrictions: “The court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws, applies to these corporations. We are all of opinion that it does” (396).

However satisfying to corporate lawyers, the concept was troubling for jurisprudence. As Maitland suggested, the growing power and increasing recognition of corporate “persons” demanded attention to the philosophical foundation of legal personality itself. Was corporate personality an expression of “some deep-set truth” or simply a “product of mankind’s [read the law’s] propensity to feign”? Was the corporate person “real” or “artificial”? On this question depended the legitimacy of the state, as well as of the corporate entities.

John Dewey argued in 1926 that questions about the nature of corporate personality were not only about corporations and the state but about people. The dilemma that had emerged for jurisprudence spread beyond the dichotomy between “real” and “fictional” legal entities to include the domain of law’s treatment of “natural persons.” The terminology of jurisprudence was betraying its difficulty in coming to terms with human existence as well as human association.

[E]ven if it were true, as it is not, that “natural person” is a wholly unambiguous term, to term a “natural” person a person in the legal sense is to confer upon it a new, additive and distinctive meaning… The root difficulty in present controversies about “natural” and associated bodies may be that while we oppose one to the other, or try to find some combining union of the two, what we really need to do is to overhaul the doctrine of personality which underlies both of them (Dewey 1926, 657-58).

Before midcentury, jurisprudential trauma was resolving into a consensus that corporations and “natural persons” were, insofar as law was concerned, basically the same. The “crisis” of legal imagination in grappling with corporate personality was settling into an agreement no longer to ask difficult questions about the “essence” of personality. In place of a definition of legal personality, jurisprudence moved toward an approach that is dominant as the twentieth century comes to an end: the analysis of “interests” with an eye to “costs” and “benefits.” Dewey’s “plea” resonated in jurisprudential circles and presaged the future. “As far as the historical survey implies a plea for anything, it is a plea for disengaging specific issues and disputes which arise from entanglement with any concept of personality which is other than a re-[*103] statement that such and such rights and duties, benefits and burdens, accrue and are to be maintained and distributed in such and such ways, and in such and such situations” (1926, 669; emphasis in original).

The Supreme Court’s refusal to hear argument in Santa Clara about its extension of Fourteenth Amendment jurisprudence was a prime example of Dewey’s assessment of the law’s lack of need for theory. “There is no general agreement regarding the nature in se of the jural subject; courts and legislators do their work without such agreement, sometimes without any conception or theory at all regarding its nature; it can be shown that recourse to some theory has more than once operated to hinder rather than facilitate the adjudication of a special question of right or obligation” (Dewey 1926, 660).

The circuit court in Santa Clara did not avoid discussion of an underlying jurisprudence. Its opinion confidently presented corporate personality as a legitimate and necessary aspect of economic “leadership” in society, rather than as a form of economic domination as the Populists argued. The decision announced broad constitutional protection for corporate persons within a description of society as a system of market relations.

The circuit court opinion opened with a preliminary statement of the conclusion to be reached: “The principle which justifies… a discrimination in assessment and taxation, where one of the owners is a railroad corporation and the other a natural person, would also sustain it where both owners are natural persons” (Santa Clara County v. Southern Pacific Railroad, 18 Federal Reporter at 396 [1883]).

The court thus asserted, in a converse syllogism, that where law prohibits discrimination between human beings (“natural persons”), no discrimination may be made between human beings and corporations. The court’s justification for this proposition was set out in a series of hypothetical statements describing varieties of discrimination. The text moved from discrimination based on human characteristics to discrimination based on characteristics of human economic behavior to discrimination involving strictly economic categories:

It would be a singular comment upon the weakness and character of our republican institutions if the valuation and consequent taxation of property could vary according as the owner is white, or black, or yellow, or old, or young, or male, or female… Strangely, indeed, would the law sound in case it read that in the assessment and taxation of property a deduction should be made for mortgages thereon if the property be owned by white men or by old men, and not deducted if owned by black men or by young men; deducted if owned by landsmen, not deducted if owned by sailors; deducted if owned by married men, not deducted if owned by bachelors; deducted if owned by men doing business alone, not deducted if owned by men doing business in partnerships or other associations; deducted if owned by trading corporations, not deducted if owned by churches or universities; and so on, making a discrimination whenever there was any difference in the character or pursuit or condition of the owner. To levy taxes upon a valuation of property thus made is of the very essence of tyranny, and has never been done except by bad governments in evil times, exercising arbitrary and despotic power (396).

[*104] Note the semantic structure of the opinion. The distinction between individual economic activity and the activity of economic organizations was smoothly elided. Differences of economic function were neatly equated with human differences. Signs of natural human difference—race, sex, age—were intertwined with signs denoting types of institutions and forms of business organization. In this way the doctrine of legal personality admitted no distinction between humans and human organizations, between biology and politics—one was included within the other. Human existence was subsumed in the abstract realm of political economy. This semantic movement reached its foreordained conclusion: the concept of human equality in the Fourteenth Amendment not only extended to the nonhuman but prohibited any distinction between human and nonhuman, between humans and corporations.

The Santa Clara decision transposed the specific political relationship of the Fourteenth Amendment to the emancipation of black slaves into a generic logic of nondiscrimination. The court’s decision was organized as a panegyric, eulogizing the Fourteenth Amendment (in generic terms) and articulating the activity of law in religious imagery:

With the adoption of the [Fourteenth] amendment the power of the state to oppress any one under any pretense or in any form was forever ended; and henceforth all persons within their jurisdiction could claim equal protection under the laws…. This protection attends every one everywhere, whatever be his position in society or his association with others, either for profit, improvement, or pleasure. It does not leave him because of any social or official position which he may hold, nor because he may belong to a political body, or to a religious society, or be a member of a commercial, manufacturing, or transportation company. It is the shield which the arm of our blessed government holds at all times over every one, man, woman, and child, in all its broad domain, wherever they may go and in whatever relations they may be placed (398).

The opinion described a community in which the mode of belonging was based on legal recognition. “Natural persons” were included in this community only to the extent that human existence was determined to have legal significance. The decision simultaneously excluded the humanity of Populist dissent as an “other,” outside the community, and reinforced the power of corporate economic organization within the community.

The court refused to discuss Populist objections to vast aggregations of wealth. Instead, it simply asserted that these aggregations have a beneficial impact on people’s lives: “the aggregate wealth of all the… companies engaged in business, or formed for religious, educational, or scientific purposes, amounts to billions upon billions of dollars… and furnishes employment, comforts, and luxuries to all classes, and thus promotes civilization and progress… the persons composing them—amounting in the aggregate to nearly half the entire population of the country” (405).

Populist battles against corporate power were derailed in the name of freedom from state tyranny. The corporate person was portrayed as a benevolent Titan, allied with humanity in a struggle for material prosperity and endangered by foolish legislation. There was no acknowledgment in the court’s opinion of any dangers posed to humanity by this alliance.

[*105] The Political Economy of Corporate Personality

The doctrine of full-fledged corporate personality in legal discourse coincided with the historical separation of finance capital from industrial management. Two types of property were presented by an emerging fragmentation of corporate political economy: one, the physical assets of the corporation, operated by its managers; the other, the claim of investors to a share in profits generated by such operation.

The position of investors, so different from the individual proprietors envisioned in classical theories of market society, was exposed by the Populist distinction between property owned for use and property owned for profit. The tax provisions of the 1879 California Constitution, by changing the mode of assessment in order to get at the “going value” of the railroads (as contrasted with the cash value of their assets), levied on the profit-generating capacity of the railroads. This change threatened not only the railroads but the whole system of finance capital which underwrote and depended on the profitability of corporate concentration.

Railroad lawyers seem to have been particularly prescient about the matter: “Property”—heretofore tangible property—had to be equated to “earning power” or “exchange value” or, as one of the pioneer Southern Pacific Railroad briefs put it (in a truly inspired and prophetic typographical error), the phrase in the Fourteenth Amendment had to be read as “deprived of… profit without due process of law” (Graham 1955, 164).

The sensitivity of railroad lawyers to the significance of a conception of property as exchange-value may be traced to the needs of their real clients, that is, not the railroad managers with their inventories of rails and rolling stock but the investors with their shares of stock. Railroad finance had begun to transform investment banking generally (Werner 1981, 1639; Ireland, Griss-Spell, and Kelly 1987, 157-59), and this wider interest was at stake in the corporate battle against populism. The property in profits sought separation from the property in assets to protect the owners of the profits from any claims that might arise by virtue of the management of the corporate assets. (This is the core meaning of the “limited liability” of corporate investors.) Corporate personality provided the legal vehicle for this political-economic distinction, becoming the constitutional basis for judicial protection of both kinds of property, both kinds of owners, both kinds of power—management and investment—from legislative (Populist) interference.

The conservative press of the day was quick to applaud the Santa Clara decision, greeting it with accolades and pressing the legal reasoning to a clear political-economic conclusion: “the law will continue to guarantee to capital invested in partnerships or associations or any form of corporate effort the same rights it would have if managed separately by individual owners” (Graham 1955, 194). Note the comment that the decision protects capital and guarantees its rights. The result of the corporate personality decision was not simply to protect corporate property against the state but to personify capital itself within a general system of market economy. The concept of the corporate person also had the effect of enhancing the power of corpo-[*106] rate managers against stockholders. The corporate “legal person,” doctrinally separated from its owners, required managerial guidance almost as a ward needs a guardian. The diminished role of stockholders in corporate management became the source of concern about “power without property” (Berle and Means 1932) and of various contemporary debates about “corporate social responsibility” (Stone 1975).

American Progressives and Legal Realists approached the displacement of individual by corporate persons as a problem for jurisprudence generally. Maitland had made available Germanic notions of “group will” and suggested a legal framework that would admit groups to the status of real persons, but the fracture of management from ownership left the corporate person with a split personality not amenable to the Germanic concept. United States jurists preferred to rely on the Roman-derived “fictional person” doctrine, and solved the problem of what to do with “natural persons” by dismissing them from law except insofar as they might fit within this fiction. There were to be no “real” legal persons (except the state itself). In Dewey’s words, “for the purposes of law the conception of ‘person’ is a legal conception; put roughly, ‘person’ signifies what law makes it signify” (1926, 655). The only reason there was any confusion about this was that “extraneous influences” had been introduced into legal practice, including “a mass of non-legal considerations: considerations popular, historical, political, moral, philosophical, metaphysical and, in connection with the latter, theological” (655).

Clearly, the “pragmatists” of the day were of a mind to separate law from the rest of life, excluding all discourses not pertaining to “the strictly legal sphere.” The fact that this legal sphere itself carried metaphysical and theological pedigrees was overlooked. After World War II, “the place of the corporation in law had ceased to be controversial, and both theoreticians and practitioners concerned themselves instead with organizational theory and economic analysis of corporate behavior. The corporation as a legal institution ceased to be of interest…. As a result, a modern lawyer knows only that a corporation is considered a legal person but finds that terminology devoid of content” (Mark 1987, 1441).

Legal theory in the United States today is dominated by an “economic analysis of law” premised on the theory that law “uncannily follows economics” (Barzelay and Smith 1987, 84) in pursuit of economic rationalization and efficient wealth maximization. This “cost-benefit” jurisprudence ironically mirrors Karl Marx’s formulation of the relation between law and economy: that law is an ideological “superstructure” on an economic “base” (Marx 1977, 175n). What Marx saw as the domination of society by a ruling class, capitalist theorists celebrate as social progress.

On the one side, “economic analysis of law” provides only an apology for legal personality. On the other side, Marx’s “base-superstructure” image fails to explain the power of legal discourse generally. As Marx acknowledged, “The influence exercised by laws on the preservation of existing conditions of distribution, and the effect they thereby exert on production has to be examined separately.” The manuscript of the originally planned part 7 of volume 1 of Capital, not published until [*107] 1933, breaks off into fragments at precisely the point where Marx states that “the relations of production, are themselves produced” (1977, 1065).

We need to explain both the reflection of economic practice in legal doctrine and the dependence of economic practice on the force of law. We may do this through an approach derived from the “commodity theory” of law and economy (Pashukanis 1978; Balbus 1977).

The doctrine of the “reasonable man” provides a helpful starting point. The “reasonable man” signifies a legal ideal of human cognition and self-control. It serves as a standard by which legal authorities assess the behavior of real persons: “Negligence is the omission to do something which a reasonable man, guided by those considerations which ordinarily regulate the conduct of human affairs, would do, or doing something which a reasonable and prudent man would not do” (Missouri, K & T. Ry. Co. of Texas v. Hannig, 43 Southwest Reports at 509 [1897]).

The “reasonable man” is deployed by law in opposition to existential human behavior. The whole purpose of the legal person is to mask the existential person, to subdue it. A contributory negligence decision from the New Mexico Court of Appeals illustrates this:

The fact that plaintiff subjectively did not consider his actions dangerous is not the issue…. The issue is would a reasonable prudent person anticipate the danger of using his foot to dislodge a clog in an area where there were moving parts of the machine which would cause serious injury…. Plaintiff asserts that there was an issue of fact as to “[w]hat effect the custom of the community had on the standard of care when all the witnesses testified it was the common custom in the community to do what plaintiff did”…. In determining whether the particular acts of a plaintiff constitute negligence, the test is not the frequency with which other men commit such acts but whether the plaintiff at the time of the occurrence, used that degree of care which an ordinarily careful person would have used… Custom in and of itself is not conclusive. It must meet the standard of ordinary care (Karl Cox, Jr. v. Karl Cox v. J. I. Case Company, 89 New Mexico Reports at 556-57 [1976]).

Forcibly (through “law enforcement”) superimposing an abstract realm of legal personality on the existential reality of human beings, law constitutes a society of abstract beings related by abstract rationality, in opposition to real communities of “natural” human beings related by situational, existential rationality. It is not surprising to find that this law is more congenial to corporate persons than to humans on the relevance of “community custom” in defining “reasonableness”:

The “reasonable man” is, of course, a fictional character borrowed from tort law…. Because the reasonable man personifies the community ideal of reasonable behavior, evidence of customary conduct of those similarly situated may be probative in determining his behavior…. Here, the Commission would…assert the authority to decide what a reasonable prudent employer would do under particular circumstances, even though in an industry of multiple employers, not one of them would have followed that course of action…. Where the reasonable man is used to interpolate specific duties from general OSHA regulations, the character and purposes of the Act suggest a [*108] closer identification between the projected behavior of the reasonable man and the customary practice of employers in the industry (B & B Insulation, Inc. v. Occupational Safety and Health Review Commission, 583 Federal Reporter 2d at 1364 [1978]).

We see here the interdependence of law and economy as arenas of thought and action. The doctrines of legal personality reflect economic practices, while these practices in turn rely upon enforcement of the doctrines for their effectivity.

Seventy-seven years after Santa Clara, in Bell v. Maryland, (378 U.S. Reports 226 [1963]) the operation of corporate personality in human affairs came again under scrutiny in the Supreme Court. This time it was not human discrimination against corporations but corporate discrimination among humans that provoked the legal controversy. Civil rights activists had been convicted of “criminal trespass” for their “sit-in” at a segregated restaurant. The Court reversed the convictions and remanded the case to state court for further interpretation of state laws regarding property and public accommodations. Justice Douglas dissented from the Court’s refusal to declare a right of public accommodation under the Fourteenth Amendment. He criticized the argument under criminal trespass law that “a person’s ‘personal prejudices’ may dictate the way in which he uses his property”:

With all respect, that is not the real issue. The corporation that owns this restaurant did not refuse service to these Negroes because “it” did not like Negroes. The reason “it” refused service was because “it” thought “it” could make more money by running a segregated restaurant…. Here, as in most of the sit-in cases before us, the refusal of service did not reflect “personal prejudices” but business reasons…. Moreover, when corporate restaurateurs are involved, whose “personal prejudices” are being protected? The stockholders’? The directors’? The officers’? The managers’? The truth is, I think, that the corporate interest is in making money, not in protecting “personal prejudices” (Bell v. Maryland, 245-46).

One year later, after refusing to declare a constitutional right in Bell, the Supreme Court considered the constitutionality of the federal Civil Rights Act of 1964. The decision in that case, Heart of Atlanta Motel v. United States {379 U.S. Reports 241 [1964]}, noted that a “fundamental object” of the Act was “to vindicate ‘the deprivation of personal dignity that surely accompanies denials of equal access to public establishments” ( 250). But, as in Bell, the Heart of Atlanta Court declined to enter into a Fourteenth Amendment jurisprudence of human rights and dignity. Instead, the Court explored an alternative constitutional basis—the power of Congress to regulate interstate commerce:

[T]he record of [the Act’s] passage through each house is replete with evidence of the burdens that discrimination by race or color places upon interstate commerce…. Negroes in particular have been the subject of discrimination in transient accommodations, having to travel great distances to secure the same…. [O]ften they have been unable to obtain accommodations and have had to call upon friends to put them up overnight…. [T]here was evidence that this uncertainty stemming from racial discrimination had the effect of discouraging travel on the part of a substantial portion of the [*109] Negro community…. This was the conclusion…also of the Administrator of the Federal Aviation Agency who wrote…that it was his “belief that air commerce is adversely affected by the denial to a substantial segment of the traveling public of adequate and desegregated public accommodations” (252-53).

This legislative history, the Court stated, “has brought us to the conclusion that Congress possessed ample power in this regard, and we have therefore not considered the other grounds relied upon…. [S]ince the commerce power is sufficient for our decision here we have considered it alone” (250). In short, Heart of Atlanta upheld the constitutionality of the 1964 Civil Rights Act not because of black people’s status as human persons, but because of their status as objects in commerce.

The Court’s commodified definition of civil rights aimed at equality by virtue of the fact that the market equalizes everything: money is the universal equivalent, through which all things are made fungible. The essence of commodification is the transformation of unique individuality into generic form. In this case, the uniqueness of black people’s historical relation to the Constitution was transformed into the generic form of the consumer in a market economy.

The jurisprudence of Heart of Atlanta was not about value in human terms of the freedom to travel or to eat in public. It was about economic value (in terms of the gross national product) to be derived from an expansion of interstate commerce. This market-based civil rights in the promised land of the “Great Society” translated human values into an abstract context. It rested on and reinforced a system of human relations in which people are subordinated to property and have “rights” and “freedoms” only on the basis of marketability.

Just as the historical “freedom” for medieval peasants to leave the feudal manor involved their introduction into wage labor, so the “freedom” of black people to “move in commerce” involved subjugation to the cost-benefit calculations of market jurisprudence. The commerce clause version of civil rights said no more than that those who have sufficient money to pay for what the market offers must be permitted to participate in that market. This is the “equality” of commodified human relations.

It has been argued that interpretation of the Fourteenth Amendment in terms of an abstract equality actually undermined the struggle of black people to achieve political and economic freedom. On the one hand, the exclusion from legal discourse of the unique historical relation of black people to the Civil War amendments blocked utilization of those amendments as a specific legal reparation for slavery. On the other hand, enforcement of a market-based civil rights “integration” policy has repeatedly destroyed the human community basis for black economic advancement.

Thus, black aspirations are trapped within the ambiguities of the constitutional meaning of the equal protection clause. Continued agitation and leadership confrontations on this issue…are not only fruitless but counterproductive. The traditional civil rights leadership that aims at perpetuating this mode of agitation is detrimental to future development in the political, economic, educational, and cultural dimensions of the black cause (Cruse 1987, 379; emphasis in original).

[*110] It has also been argued that an economistic, commodity definition of freedom undermines human community in general, and not only the community of those who have been specifically oppressed: “this kind of economics [market exchange] has the greatest difficulty in reflecting the reality of human community and the value of communal institutions. Its necessary tendency seems to be to destroy the idea of public action, indeed the idea of community itself” (White 1986, 191).

Political Reflections

Corporate personality is far more than a symbolic device to permit law to deal with associations of people. Corporate personality consists of and depends on a generalized substitution of juridical persons for real people. The doctrines of “legal personality” present social relations as a product of legal institutions, dependent on enforcement of an authoritative (legal) discourse, rather than as inherent in “natural” existence.

These themes are mirrored in mass media where corporate sponsors dictate a normalizing of human anxiety and insecurity, alleviated by the joy and satisfaction of commodity consumption. Advertising promotes the image that life itself is the province of corporate persons: “We bring good things to life,” and “GE restores your faith in your own two hands” (General Electric); “Come home to NBC” (National Broadcasting Company); “Life’s Worth Litton” (Litton Industries). Real human individuality is replaced by a commodified individualism: “Be yourself,” say the ads. “Buy this (mass-produced product).”

Legal personality is the result of a “generative and creative act of meaning” (Goodrich 1986, 221) in a process of political-economic persuasion and seduction. The prospect for achieving a life of “natural sociability” is bound up with how and whether people understand the signs, the rationality, and the metaphysics of the discourses that deny and obscure this possibility. A loss of faith in the conventional meaning of the Fourteenth Amendment does not require abandonment of the idea of a free society; rather, it makes possible a renewed discourse about freedom and equality. “Nihilism in the context of legal studies simply means loss of faith in the community of legal doctrine and refusal to succumb, acquiesce or otherwise believe in the foundational myths of legal doctrine and legal regulation” (Goodrich 1986, 217).

The moment may be ripe for “nihilism as…an affirmative…will to create new values, new modes of organization and of collective belonging” (214). “The very values and assumptions about society upon which corporatism ultimately rests, functional specialization and hierarchical organization, security and prevision, ‘productivism’ and efficiency, economic growth and mass consumption as ends in themselves, are being called into question” (Schmitter 1979,40-41); some may move with the suggestion for “some experimentation with the sort of dispersed, nonspecialized, nonhierarchic, ‘hived-off,’ voluntaristic units, autonomously responsible for allocating their values and resolving their conflicts, an interest system…tentatively identified as syndicalist” (41). Others will notice that “[t]he corporation forms the clos-[*111] est attempt of the white man to socialize his individualism and become a tribal man” (Deloria 1969, 225). Few will still believe with Durkheim that “corporations…provide the answer to overcoming modern man’s moral and spiritual malaise, integrating him into society through new communal bonds” (Schmitter 1979, 32).

Fascism may remain as the most thorough subsumption of “natural persons” into legal personality:

The Fascist State…had to act so as to have in its presence only individuals and groups whose position had been declared legal: individuals thus acquired the character of citizens, and their groups, the character of “juridical persons”—legal associations…. [T]hese recognized syndicalist associations…are…regarded as…active and passive…, that is to say, having both rights and duties…. But those whom the recognized syndicates represent are not mere citizens…. [T]heir position is…more specifically that of passive “juridical persons” (Bottai 1931, 34-35).

The medieval origins of corporation law were an arena of state-building. The emerging nation-states proclaimed themselves “sovereign” over populations of individuals. The states were hostile to corporate associations intermediate between the sovereign and the people. The “intended victim of the would-be sovereign prince was…feudal society itself,” with its “segmenting and parceling process” (Strauss 1986, 243). For their part, such associations asserted traditions anterior to the state and formed regional alliances against the centralizing tendencies promoted by the discourse of Roman law.

Because corporate power in the United States is legally separate from state power (“private” versus “public”), the situation is superficially more akin to the late medieval structure of corporate “estates” as “cobearers of central power” (245) than to twentieth-century fascism’s “corporative conception of the State” (Bottai 1931, 30). However, since the basis of contemporary corporate power is not local, landed traditions as in feudalism but highly centralized market position, the overall result of the situation is actually quite similar to the fascist “inclusion of economy in the State…, the identification of politics with economics” (39) with the qualification that in an increasingly global corporate form it appears that the “state” is included within the “economy.”

A system based on personal property and formal equality of all “persons” produces a corporate managerial class whose plans and desires become the integrating mechanism of society, without explicitly mandating this mechanism. Liberty of ownership becomes de facto the ownership of liberty, while de jure universal freedom prevails. As Justice Douglas remarked in dissent in Bell v. Maryland:

Affirmance [of the lower court decision] would make corporate management the arbiter of one of the deepest conflicts in our society: corporate management could then enlist the aid of state police, state prosecutors, and state courts to force apartheid on the community they served, if apartheid best suited the corporate need; or, if its profits would be better served by lowering the barriers of segregation, it could do so (264, emphasis in original).

[*112] Foucault has said that “the soul is the prison of the body” (1977, 30). Perhaps it is the notion that a corporation has no soul (from Innocent IV, lifted into English law by Sir Edward Coke and Blackstone) that has allowed the corporate person to so far outstrip its human origins that it now threatens to consume the earth in a mad war for global domination. Perhaps the antidote to law’s soulless corporation is human self-awareness and mutual association not for profit. Whatever the merits of these speculations, the fact remains that the subsumption of “natural persons” within “legal personality”—the ruling idea of the ruling institutions in our day—is synonymous with the denial of existence, the sacrifice of life.

References

Peter d’Errico is a consulting attorney on indigenous issues. He was a staff attorney in Dinebeiina Nahiilna Be Agaditahe Navajo Legal Services from 1968 – 1970, and taught Legal Studies at the University of Massachusetts, Amherst, until 2002. You can view all of his teachings HERE.