Last month, the Supreme Court heard a case in which it will have to decide whether a company enjoys a constitutional guarantee against “cruel and unusual punishment.” The case revolves around a fine for engaging in construction without a licence but the broader moral and economic question is important: Do individual Canadians lose their constitutional rights when they organize themselves in various ways?
The question has been a live issue in the United States since the 2010 Citizens’ United decision, in which the Supreme Court held that individuals retain their free speech rights even when acting as a corporation. That decision has been consistently and energetically attacked from the left. As Kent Greenfield put it in The Atlantic, “The American left is notoriously fractious. But one belief that unites (it) more than most is this: Corporations are not people.”
Morally, the issue is simple and has been settled for over a century. Like a crowd, an organization is a mental representation made up of actual, living humans. Just as it’s illegal to murder a person, it’s illegal to murder a crowd of people. And if that crowd would like to organize and form a political party or a company or any other form of corporate entity, the individuals within it still retain their rights. Merely being part of an organization does not negate their human rights.
This point, that organizations have the same rights as the people who make them up, is important in politics. Because, as we see every day, it is much easier to attack or demonize an organization as if it were some faceless abstraction, ignoring the actual humans who make it up. Fines, corporate taxes, or forced contributions are all paid by actual humans — by shareholders in the first instance, with most of the costs passed on to everyday customers in the form of higher prices.
Economically, the question is important because all of our wealth, from the food we eat to the roads we drive on to the heat in our homes, is built with productive investment. Without factories, storefronts, inventories, R&D, and investments in finding, hiring and training staff, Canada as we know it would be all but uninhabitable. And many of the most productive investments, because of their size and inherent riskiness, are made almost exclusively by companies.
Even government, that other large organization that does numberless things in Canada, is only possible because of the taxes paid by companies, both directly on capital and profits and indirectly via the taxes employees pay on the salaries and wages companies pay them. Without those taxes, there would be literally no money to keep the lights burning on Parliament Hill.
As for regular people, if Canada becomes a place where investors are scared off lest they lose their humans rights as soon as they organize into a company, we will all suffer tremendously. We will lose existing companies and the goods and services we enjoy today. And we will especially lose new investments, along with the jobs, goods and services Canadians would have enjoyed into the future.
The Canadian economy today is impressive both for its ongoing wealth generation and for its substantial upward mobility — one recent study finding that some 83 per cent of Canadians in the bottom fifth of income-earners had moved up to a higher bracket 10 years later. In order for that wealth generation to continue to enrich Canadians, rich and poor alike, the people who are creating the jobs and growing the economy need to continue to enjoy the same protections they have now.
Open season on entrepreneurs and investors will lead to nobody actually producing anything or employing or paying anyone. We should strongly reject any attempt to dehumanize entrepreneurs and investors by pretending they signed away their human rights the day they decided to pitch in and build Canada’s future.
Peter St. Onge est économiste senior à l’IEDM. Il signe ce texte à titre personnel.