This opinion piece was first published in the Spring/Summer 2011 issue of Nexus magazine.
In the debate about whether political donations and advertising by corporations should be permitted in a democracy, there are two unhelpful but tenacious myths.
One of them is that “there is no such thing as too much speech,” to quote U.S. Supreme Court Justice Antonin Scalia. The other myth is that corporate political involvement is inherently illegitimate, because corporations are merely “artificial persons,” creatures of the state. The first myth is advanced by the supporters of corporate political speech, while the second is put forward by its opponents. Neither is helpful.
If individuals had unlimited time and attention spans, there would indeed be no such thing as too much information. But in the real world, people’s time and attention are scarce resources, and the relative size of the communication budgets devoted to rival arguments can therefore be expected to have an impact on their reception by citizens. That’s just Advertising 101. So there’s a real question whether especially well-financed messages need to be regulated, so that other messages can be heard too.
As for the second myth, the case for corporate political speech doesn’t in fact depend on thinking of corporations as “persons.” On the contrary, what’s important about corporate speech is that, like everything else the corporation does, it reflects the aggregated preferences and interests of large numbers of real people who transact through corporations. That’s Corporations 101.
To take a concrete example, consider the U.S. Chamber of Commerce’s advocacy of immigration reform to create a “path to legitimacy” for undocumented workers. The most likely explanation for the Chamber’s political stance is that U.S. consumers want stable access to labourintensive goods at lower prices, and corporations increase shareholders’ profits by meeting this demand. The Chamber’s political activities are, in other words, a conduit for the interests of consumers and shareholders.
The aggregating feature of corporate political speech is especially important given that one of the most difficult challenges in a large democracy is how to overcome citizen passivity. A small minority of people, especially at either end of the political spectrum, get involved in grassroots politics. By contrast, the large middle of the spectrum— where many consumers and shareholders in large corporations reside —is often silent and passive.
Freeing ourselves of the two myths does not make debates about campaign financing go away. It does, however, enable us to focus our attention on more substantial aspects of the problem.
For instance, is it desirable to have a ceiling on political donations and communication expenditures by individuals and corporations alike? In Canada, a limit of $188,000 applies to third-party advertising during federal elections, whether by a natural person or a corporation or other group. Donations to a federal party or candidate are capped at $1,100. (Only donations by individuals are allowed.)
The decision whether to have across-the-board limits, and what level they should be set at, obviously involves a trade-off. The higher the limit, the greater the relative influence of wealthy individuals and well-organized groups. But the lower the limit, the less wellinformed is the electorate. Reasonable people can disagree about the point at which one of these impacts begins to outweigh the other.
Another issue is whether the aggregating feature of the corporate form has undesirable consequences, insofar as it may result in the interests of consumers and investors being better served than other interests. As Robert Reich has pointed out, most of us are simultaneously consumers, investors, workers, and citizens, and it may be a worry that corporate behaviour aggregates only a subset of our interests: “the consumer and investor in us is well-represented ... but the citizen in us has almost vanished from politics.”
Reich’s criticism cannot be dismissed out of hand, but it is a tricky matter to try to engineer a balance between our various interests by inhibiting an otherwise legitimate mechanism for facilitating collective action. One can try to reduce the influence of the “consumer and investor in us” by prohibiting corporate political donations and advertising, and this would increase the relative influence of the participants in grassroots politics. But it is not beyond dispute that this makes politics fairer and more democratic. It may instead allow the active few to gain at the expense of the passive many.