The political court

The Hobby Lobby decision, in case you’ve  been on retreat the last few days, is a recent decision by the US Supreme Court that allows closely-held (non-public) corporations to claim exemption under the Religious Freedom Restoration Act of 1993.

According to Justice Alito, the requirement to provide coverage for contraception imposes a “substantial burden” on the religious liberty of closely-held corporations whose owners object on religious grounds.

Naturally, the decision is a rallying cry for liberals as well as conservatives, but it continues the apparent trend in Court decisions regarding corporations. Not just the trend regarding the “personhood” of legal entities, which is often cited  by talking heads, but the trend of dissolving the wall between the corporation and its shareholders, closely-held or not.

Ironically, this is a wall erected by state business laws, although it goes to the long-established nature of the corporate entity. You have probably heard the term “creature of the state”. A corporation (or any other limited-liability entity) is not just the free association of individuals often depicted by libertarians; it exists by virtue of state laws that shield owners and operators from liability for the obligations of their enterprise. There would be no value otherwise, and no purely private arrangement could achieve the same thing.

But the price for that shield is a wall of separation, and if you fail to maintain that wall, for example by using the corporation as a personal checkbook, a creditor can “pierce the veil”, legalese for asking a judge to set aside the corporation and allow a creditor to proceed against its owners personally.

In other words, the corporation is an entity on its own, established by law. Those who form the entity give up their interest in its assets, even as they escape its liabilities. They may receive a share of corporate proceeds, but creditors have priority. Assets must be held separate. Records must  be kept, the form maintained.

Which brings me to my point. If the corporation has “personhood”, then the wall must be in place. Even a closely-held corporation must not be an alter-ego for its owners, or it is a sham without legal standing.

The personhood is a creation of the state. Unlike a natural person, it exists for the convenience of others. There is no right to life. No right to vote. And since the corporate person is incapable of faith, as it is incapable of emotion, there is no conceivable right to religious liberty.

The owners of Hobby Lobby may decry what they see as sinful or objectionable in society, including the sexual activities of their employees. But the business corporation they asked the state to charter is not an extension of their own persons, and the Hobby Lobby decision is a political one that allows certain owners the privilege of reaching into their corporations in a way rightfully denied to others.

Leave a Comment

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s