The Act (1 U.S.C. Sec. 1) provides helpful guidance that“unless the context indicates otherwise,” words that are plural include the singular, a reference to the masculine gender includes the feminine, and “the words ‘insane’ and ‘insane person’ shall include every idiot, insane person and person non compos mantis,” among other examples.

I think that the person who sent the Dictionary Act to me was trying to make a point in defense of Citizens United and to suggest that my book title (“Corporations Are Not People”) may be off-base. As my correspondent pointed out, Congress itself has defined “person” to include corporations. Here’s the Dictionary Act again:

The words ‘person’ and ‘whoever’ include corporations, companies, associations, firms, partnerships, societies, and joint stock companies, as well as individuals.

The implication sought to be drawn, I think, is that if Congress has defined the word “person” to include corporations for most of our history, the Supreme Court is correct to extend the metaphor into interpretation of the word “person” in the Constitution, and thus to equate corporations with human beings for purposes of protecting Constitutional rights.  Such an analysis would be a mistake.

The key point is the difference between (1) our Constitution, and its proper interpretation, and (2) our laws enacted by legislators, whether in Congress or in the States. State or federal law cannot change the meaning of words in the Constitution. (This point is discussed at more length in Chapter 3 of my book).

The Dictionary Act and many other statutes include corporations within the defined meaning of the word “person.” The Constitution, however, is different. When the Constitution uses the word “person”, “people” or “citizen,” the words refer to human beings not corporations. More on that point in here, especially at p. 10-15, and in Justice Hugo Black’s 1938 dissent in Connecticut Life v. Johnson [“I do not believe the word ‘person’ in the Fourteenth Amendment includes corporations.”].

This seemingly contradictory approach to interpreting the same word (“person”) to have different meanings in different places (i.e. the Constitution versus enacted laws or regulations) makes perfect sense.

First, we should recall that a corporation is a legal structure for doing business, created and defined by state legislatures (and occasionally, Congress) in order to advance what the state deems to be in the public interest. Corporations do not exist without government action; government (laws enacted by legislatures) make incorporation possible, and define what a corporation is and what it can and cannot do.  Unlike other associations or other ways of doing business, a corporation cannot exist by private arrangement.

While it is necessary for government to enact an incorporation law to permit corporations to exist, many good reasons support our modern practice of permitting ready incorporation for business or other activity. The corporate legal entity is supremely effective at bringing together and channeling ideas, capital, and labor to make a productive, growing enterprise. The corporate form streamlines contract making and enforcement; encourages, secures and rewards investment; enables risk-taking as well as sustained operations, expansion and innovation over long periods of time; and can efficiently spread risk (and reward) over many diverse shareholders. All this and more makes incorporation a very useful economic policy tool to encourage and reward investment, innovation, job creation and economic growth.

None of that, however, can turn a corporation into a Constitutional person (as opposed to a “person” as defined by state or federal statutes).

There are lots of good reasons why states and the federal government enact laws that say, in some instances, that the word “person” includes corporations. For example, the Clean Water Act prohibits unpermitted discharge of toxics and pollutants into the waters of the United States by any person. Congress wrote the Clean Water Act to create civil and criminal penalties for “any person” who violated the law, and intended to include corporations.

Similarly, it makes sense as a matter of policy to treat a corporation like a “person” when a corporation makes a contract, or is sued or brings a lawsuit, or engages in any one of many activities that state law may authorize a corporation to do. We do this because we have decided as a matter of state law that the “person” metaphor can help make the corporation better serve as a tool of public policy and economic activity.

The Constitution is different. Our Bill of Rights is not a “policy choice” that government, or even a temporary majority of people or our elected representatives, can decide upon. Rather, the Bill of Rights is the very definition of the relationship between we human beings and our government. The First Amendment and our other rights in the Constitution are the “carve-outs” for the natural human rights that we insist on withholding to ourselves when we consent to the Constitution’s plan of government in America.

When we decide that under our state or federal laws, corporations are “persons” that can be prosecuted (or that can contract, or be sued, and so on), that decision cannot transform corporations into “persons” under the Constitution’s protections of rights, whether rights of “life,” “liberty,” “property” and “equal protection” for all “persons,” or any others. (See, e.g., the Fourteenth Amendment). We can change state laws of incorporation anytime we can muster a majority in the legislature for any particular change.  We do not change the Constitution anytime a legislature, let alone the legislature of Delaware or any other state alone, decides it might be efficient to do so.

The Constitution cannot be changed by state or federal laws or majority vote but only by the process of Constitutional amendment under Article V of the Constitution. The people have never added corporations to the definition of “persons” in the Constitution by using that amendment process (a vote of two-thirds of Congress, ratified by three-quarters of the States, or a Constitutional convention). As the Supreme Court declared in the 1850s when rebuffing early corporate efforts to create corporate rights, “State laws, by combining large masses of men under a corporate name, cannot repeal the Constitution.”

To appreciate the distinction between “person” under state or federal law, and “person” under the Constitution, consider Delaware’s incorporation law. Delaware law, as in other states, declares that corporations can exist for a defined period of years or may have “perpetual existence.” If a majority of the Delaware legislature wanted to delete that last part of the law, and simply declare that corporations may exist for a period of twenty years, they could do so. In contrast, neither Delaware, nor any other state or federal legislature in America can decide that people shall have a limited period of existence. No matter how good the policy justification for such a law, that law obviously would violate the Constitution’s due process clause protecting the life of all persons.

Corporations, then, are policy tools, not people or holders of Constitutional rights. As economic tools, corporations are highly effective. Yet the same traits that make corporations such useful economic policy tools can also make them dangerous to republican government and democracy if people and lawmakers do not watch and restrain abuses. Corporations can aggregate immense power, corrupt government, drive down wages, trash public resources, concentrate markets to squeeze out competitors and more.

The need to maintain this balance, and to maintain the necessary distinction between Constititutional “persons” and legislative “persons”, is captured by one of the Founders of the nation. James Wilson, a Pennsylvanian, had signed the Declaration of Independence, served in the Continental Congress, helped draft the Constitution, and was nominated by George Washington to be one of the first six Justices on the Supreme Court. (That’s him at the top of this post). He well expressed the prevailing view that corporations can be useful tools but must always be carefully controlled by the people:

A corporation is described to be a person in a political capacity created by the law, to endure in perpetual succession…. It must be admitted, however, that, in too many instances, those bodies politick have, in their progress, counteracted the design of their original formation…. This is not mentioned with a view to insinuate, that such establishments ought to be prevented or destroyed: I mean only to intimate, that they should be erected with caution, and inspected with care.

See James Wilson, Collected Works of James Wilson, Vol. 2. Ch. X, Of Corporations, (ed. Kermit L. Hall and Mark David Hall) (http://oll.libertyfund.org/title/2074/166648/2957866, accessed 2009-07-22)