A Report by Jamie Raskin, PFAW Foundation Senior Fellow
“[C]orporations have no consciences, no beliefs, no feelings, no thoughts, no desires.”
— Justice John Paul Stevens, dissenting in Citizens United, 558 U.S. 310, 466 (2010)
“We see no reason the Supreme Court would recognize
constitutional protection for a corporation’s political expression but
not its religious expression.”
— Hobby Lobby Stores Inc. v. Sebelius, 723
F.3d 1114 (10th Cir., 2013), Judge Tymkovitch, United States Circuit
Court of Appeals for the Tenth Circuit for the majority
If right-wing America had set out to design a Supreme Court case that
combined all of its political fetishes, it could not have done better
than to come up with
Hobby Lobby Stores Inc. v. Sebelius, a
devilishly complex assault on Obamacare, women’s health care rights in
the workplace, and the embattled idea that the Bill of Rights is for
people, not corporations. The outlandish claims of the company involved
would not have a prayer except for
Citizens United, the miracle gift of 2010 that just keeps giving.
Hobby Lobby is a big business that wants to deny thousands of its
female employees access to certain contraceptives, like Plan B and
certain IUDs, which are supposed to be available to everyone under
Obamacare but which the company says it finds theologically
objectionable. Ironically, Hobby Lobby’s private insurance plan fully
funded these religiously incorrect forms of birth control for several
years before the 2010 passage of the Patient Care and Affordable Care
Act and the Department of Health and Human Services’ issuance of its
“Preventive Services” Rule, which made coverage for them obligatory. So
it was the workings of Obamacare which apparently gave this business
entity its corporate epiphany that these forms of birth control were
sinful and the will to fight the contraceptives it had once been
perfectly content to subsidize. Amazingly, this challenge produced an
off-the-rails decision by the United States Circuit Court of Appeals for
the Tenth Circuit that the company’s “religious” rights had been
violated.
The Supreme Court has now taken up the case, which offers the five conservative Justices in the
Citizens United majority the chance to:
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find that for-profit business corporations enjoy not just the political rights of the people but the religious rights of the people;
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declare that the "Preventive Services" Rule under Obamacare violates
the federal Religious Freedom Restoration Act of 1993 (RFRA), 42 U.S.C.
2000bb et seq., by compelling major business employers to fund religiously offensive contraceptive care for women employees;
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and grant business corporations a sweeping new religious pretext for escaping a wide range of federal laws in the future.
Hobby Lobby has been consolidated with
Conestoga Wood Specialties Corp. v. Sebelius,
724 F.3d 377 (3d Cir., 2013), in which the United States Court of
Appeals for the Third Circuit rejected the same package of arguments,
advanced by a company owned by Mennonites, concluding simply that
“for-profit, secular corporations cannot engage in religious exercise”
and remarking that “we are not aware of any case . . . in which a
for-profit, secular corporation was itself found to have free exercise
rights.”
It is a sign of the times that the Tenth Circuit refused such an
obvious conclusion, one arising out of centuries of American
jurisprudence about the corporation, and instead voted to give Hobby
Lobby the power under RFRA to deny its women employees coverage for
certain contraceptives. It is a sign of the perilous corporatist path
we are on that the Roberts Court now seems poised to take these claims
seriously and to baptize for-profit business corporations as pious
citizens, giving them the selective power to discriminate against
employees who want nothing more than an equal right to comprehensive
health care services.
As we shall see, not only is the Hobby Lobby corporation not being
forced to violate its religious rights here (it doesn’t have any), but
it is not even being forced to pay for the offending contraceptive
coverage at all because it is perfectly free under Obamacare simply to
pay taxes into the general program rather than to purchase insurance
plans for its employees. Payment of the tax would be both a less costly
alternative and one that removes the corporation’s alleged discomfort
about paying for certain kinds of birth control. But the case is
sufficiently complex, as a matter of fact and law, that there are many
opportunities for conservatives to obscure the reality and promote the
brazen claim that corporations are persons and Obamacare is trampling
their religious freedoms.
Citizens United: The Walls of Separation Come Tumbling Down
The American people have built two essential walls to protect the
integrity of political democracy. The original one is Jefferson's "wall
of separation" between church and state, embodied in the First Amendment
religion clauses. This wall fosters and protects religious diversity
and at the same time makes certain that neither secular government nor
individual conscience will be overrun by religious power.
The second one is the wall separating corporate treasury wealth from
campaigns for federal public office. This wall was built in federal and
state law over the course of the twentieth century by progressive
movements to guarantee that democratic process and political leadership
would not be overrun by private corporate wealth and power, the problem
that confronted America in the First Gilded Age.
This wall between corporate wealth and democratic politics was
bulldozed and nearly flattened in 2010 by the Supreme Court in Citizens
United. In that watershed 5-4 decision, the Court granted for-profit
business corporations the political free speech rights of the people
under the First Amendment, wiping out dozens of federal and state laws,
reversing key precedents, transforming corporate treasuries into
campaign slush funds, and unleashing untold billions of dollars in the
political process.
Now, in
Hobby Lobby, conservatives on the Court are on the
verge of taking a ferocious swing at the wall of separation between
church and state, and their sledgehammer is none other than the
Citizens United
decision itself. Although the case is framed as whether corporations
are “persons” under RFRA, the meaning of that important federal statute
is determined with respect to the Supreme Court’s Free Exercise
precedent prior to its decision in
Employment Division v. Smith, 494 U.S. 872 (1990). So the underlying question is necessarily whether corporations have Free Exercise rights.
Hobby Lobby comes from an
en banc ruling of the
United States Court of Appeals for the Tenth Circuit, which has advanced
an extraordinary and dangerous conclusion: that a for-profit
corporation operating more than 500 arts-and-crafts chain stores across
the country and employing about 13,000 workers is actually a “person”
engaged in the “exercise of religion” within the meaning of RFRA and,
therefore, is immune from having to offer certain contraceptive coverage
to its women employees under the Affordable Care Act. The basis for
the ruling is that the five members of the Green family who own and
operate Hobby Lobby have stated their commitment to “honoring the Lord
in all we do by operating the company in a manner consistent with
biblical principles.” 723 F.3d at 1122. The Tenth Circuit found that,
because Hobby Lobby has thus expressed itself “for religious purposes,
the First Amendment logic of
Citizens United, where the Supreme
Court has recognized a First Amendment right of for-profit corporations
to express themselves for political purposes, applies as well.
We
see no reason the Supreme Court would recognize constitutional
protection for a corporation’s political expression but not its
religious expression.” (emphasis added)
The Tenth Circuit thus not only found that this giant corporation was
a “person” practicing its (his? her?) religion but that Obamacare has
forced it to violate its sincerely held religious belief that life
begins at conception. Specifically, it ruled that the law
substantially
burdened the corporation’s “religion” by arguably obligating it, under
its employer-sponsored health plan, to cover several forms of
contraception—including two types of IUDs and the emergency
contraceptives Plan B and Ella—that the corporation considers
religiously objectionable.
Furthermore, in performing the analysis required under RFRA, the
en banc
court found that the United States had no compelling interest in making
Hobby Lobby, a religiously pious and devout corporation, offer such
contraceptives to its female employees against its professed sectarian
principles. The comic dimension of the case is that Hobby Lobby’s
employee insurance policy was already covering the contraceptives it
allegedly deplores when Obamacare became the law. In other words, the
corporation only became exorcised and religiously activated on the
contraceptives when it decided to oppose the new federal policy.
Business Corporations Have Never Had Religious Rights and the Idea Is Absurd
The astounding nature of the decision becomes clear when we focus on
the fact that Hobby Lobby is a regular business corporation, secular in
its operations and devoted to profit-making purposes. It is neither a
church nor a religious organization. It does not hire its workers based
on religious preferences or practices. Under the Affordable Care Act,
if Hobby Lobby
were a church or a non-profit religious
organization that had as its purpose the promotion of religious values,
and if it primarily employed and served people along religious lines, it
would be considered a “religious employer” and it would be
completely
exempted from the contraceptive-coverage requirement. Even if it did
not meet those stringent criteria, the company could still be exempt
under the law if it were a non-profit institution that objected to
contraceptive coverage for religious reasons, as do certain religious
institutions of higher education.
But Hobby Lobby is neither a “religious employer” nor a non-profit
institution. It is a standard for-profit business corporation. That is
why the case is of such surpassing importance. It threatens to carry
over
Citizens United’s transformation of corporations into
“persons” for political spending purposes into the realm of religious
worship and free exercise, with dramatic implications.
This whole business of humanizing and now ensouling corporations is a
radical departure from conventional understandings of what a
corporation is, going all the way back to the beginnings of the
republic. In 1819, in the
Dartmouth College case, Chief
Justice John Marshall declared that “a corporation is an artificial
being, invisible, intangible, and existing only in contemplation of
law.”
17 U.S. (4 Wheat.) 518, 636 (1819). Chief Justice Marshall
thought that, being artificial creatures of the state, corporations had
only the rights expressly or impliedly conferred upon them by the states
chartering them. The Supreme Court proceeded over its history to reject
claims that corporations enjoy many of the personal rights guarantees
contained in the Bill of Rights, like the privilege against compulsory
self-incrimination,
see Wilson v. United States, 221 U.S. 361 (1911), or the right to privacy,
see California Bankers Assn. v. Shultz,
416 U.S. 21 (1974). To be sure, corporations have enjoyed due process
and equal protection property rights ever since the controversial
Santa Clara County v. Southern Pacific Railroad decision of 1886, and ever since the
Citizens United
Court took a giant step to the right by declaring the political free
speech rights of corporations under the First Amendment in 2010.
The question in
Hobby Lobby is whether there is anything in
the history or doctrine of Free Exercise jurisprudence, or the Religious
Freedom Restoration Act, to indicate that corporations are to be
treated as rights-bearing for religious purposes. As the Third Circuit
found in
Conestoga Wood, there is absolutely no history of
courts providing free exercise rights to corporations, and the whole
“purpose of the Free Exercise Clause ‘is to secure religious liberty
in the individual by prohibiting any invasions thereof by civil authority.’” 724 F.3d at 385 (quoting
School District of Abington Township v. Schempp,
374 U.S. 203 (1963) (emphasis added)). The Supreme Court has upheld
the Free Exercise rights of persons and churches, but it has never
upheld the Free Exercise rights of a private business corporation. As
the Oklahoma District Court that was overruled by the Tenth Circuit put
it so cogently: “General business corporations do not, separate and
apart from the actions or belief systems of their individual owners or
employees, exercise religion. They do not pray, worship, observe
sacraments or take other religiously-motivated actions . . .”
Hobby Lobby Stores v. Sebelius, 870 F. Supp. 2d 1278, 1291 (W.D. Okla. 2012).
Corporations Can't Pray — Even If the Court Treats Them Like Gods
This is the crucial point. The author of the First Amendment, James
Madison, argued that religious exercise was a freedom belonging to
individuals,
who have reason, conviction and a relationship with God, and this
freedom could not be tampered with by the state, the church or any other
institutional power. As he put it in his famous Memorial and
Remonstrance Against Religious Taxation, quoting from the Virginia
Declaration of Rights, “we hold it for a fundamental and undeniable
truth ‘that religion, or the duty which we owe to our Creator, and the
manner of discharging it, can be directed only by reason and conviction .
. .’ The Religion then of every man must be left to the conviction and
conscience of every man; and it is the right of every man to exercise
it as these may dictate.”
The Court’s campaign to treat corporations like “persons” for constitutional purposes actually gives corporations the power to
dominate the political and private lives of citizens.
Citizens United
was decided in the name of free speech, but no person’s right to spend
his or her own money on political campaigns was enlarged by it in any
way. The effect of the decision was to give CEOs the power to take
unlimited amounts of money from corporate treasuries and spend it
advancing or defeating political candidates and causes of their
choosing. Its real-world consequence was thus not to expand the
political
freedom of citizens but to reduce the political
power
of citizens vis-à-vis huge corporations with vast fortunes. These
corporations, endowed with limited shareholder liability and perpetual
life, may now freely engage in motivated political spending to enrich
themselves and their executives, leaving workers and other citizens
behind. Adding insult to injury, most of the stock in large
corporations is owned by large entities, like retirement funds, mutual
funds, and foundations, which cannot take positions on political races
but invest the money of real, live citizens in these corporate and
political behemoths.
Similarly,
Hobby Lobby was decided by the Tenth Circuit in
the name of Free Exercise of religion and free individual choice, but
the decision makes a mockery of religion and, in the real world,
destroys the free individual choices of women who are denied their
rights to full contraceptive care under the Affordable Care Act. Anyone
who has the slightest bit of spiritual belief knows that the
religionist’s relationship with God is intensely personal and bound up
in one’s deepest values, beliefs, and ideas about the world. But, as
Justice Stevens observed in dissent in the
Citizens United
case, “corporations have no consciences, no beliefs, no feelings, no
thoughts, no desires.” 558 U.S. at 466. Corporations cannot believe in
God even if they are being treated like Chosen persons by the Supreme
Court. Corporate religiosity is both an unconstitutional idea and a
profoundly impious one.
The real-world effect of giving corporations religious rights under
RFRA or the First Amendment is not to deepen the corporations’ personal
relationship with God, but to give their owners and managers the power
to impose their religious and political beliefs on their employees—in
this case, to deny their women employees free individual choices in
reproductive and contraceptive care.
Hobby Lobby
(conveniently) involves only four contraceptive drugs which are alleged
(falsely according to many experts) to be abortifacients, but if
corporations get the right to deny
certain contraceptives because of their religious beliefs, they will of course have the right to deny their employees access to
all contraceptives
because of religious beliefs. The Court has always emphasized that it
does not police the content or consistency of religious beliefs and
dogmas.
Indeed, it follows logically from the Tenth Circuit decision that
corporations have a presumptive right to get out from under any federal
law considered religiously objectionable, because RFRA provides that the
government “shall not substantially burden a person’s exercise of
religion” unless that burden is the least restrictive means to further a
compelling governmental interest. 42 U.S.C. 2000bb-1(a) and (b).
Thus, a secular corporation owned by Christian Scientists could
presumptively refuse to pay for
any insurance plan involving
doctors or hospital care; a secular corporation owned by Jehovah’s
Witnesses could presumptively refuse to pay for any insurance covering
blood transfusions; a secular hotel chain owned by Fundamentalists could
insist, against the requirements of federal labor and employment law,
that all employees join the church; and any hotel, motel or restaurant
owned by a member of the Aryan Nations’ Church of Jesus Christ
Christian, which forbids “race-mixing” as a matter of church doctrine,
could claim exemption from the Civil Rights Act of 1964.
The fact that Hobby Lobby is a “closely held” family-owned
corporation makes no difference, because all corporations are legally
distinct from their shareholders in all cases, and the rights being
asserted in
Hobby Lobby are the rights of the corporation, not the owners. In any event, as a number of states point out in an
amicus
brief led by California, family-owned or controlled businesses account
for more than 80% of all American businesses, 60% of all U.S.
employment, and one-third of all Fortune 500 companies. The religious
rights that a small or family-owned corporation wins are the religious
rights that a big or publicly held corporation will have.
See Citizens United. There is definitely no constitutional difference between the status of a large corporation and a smaller one.
Saving Grace: The Whole Premise of the Case Is Flawed
It seems quite likely that the
Citizens United five-Justice
majority could vote for Hobby Lobby because the strongest pro-corporate
Justices are also the weakest defenders of the separation of church and
state. As usual, a high burden of hope rests with Justice Kennedy to
pull the Court back from another jarring assault on constitutional
democracy.
But even if the Court, disastrously, gets it wrong on the central
question of whether for-profit business corporations can exercise
religious freedoms, there is another chance for the Court to pull back
from the brink at least on the Obamacare question. The whole premise of
the litigation in
Hobby Lobby is that federal law
(specifically, the HHS “Preventive Services” Rule) compels the company
to furnish employees a health insurance package that covers the
offending contraceptives, thus substantially burdening the company’s
alleged RFRA and Free Exercise rights. But this is a complete
misunderstanding of how the law works because the company is not
compelled to offer its employees
any health insurance package, much less a package with specific contraceptives.
As Marty Lederman has pointed out in great detail in a trenchant blog post
(“Hobby Lobby Part III—There Is No ‘Employer Mandate’”),
federal law and the HHS rule specifying covered contraceptives “do not
impose any obligations at all on employers, such as Hobby Lobby and
Conestoga Wood.” Rather, federal law “requires virtually all
group health-insurance plans, and
insurers of group or individual health insurance,
to include coverage for various preventive services, including 18 forms
of FDA-approved birth control, without ‘cost sharing’ . . . .”
(emphasis added). However, it is true that if a plan or insurer fails
to include the required items in a plan, the government can tax not only
the plan and the insurer but the sponsoring employer as well.
But here is the key point: as Lederman writes, “
federal law does not impose a legal duty on large employers to offer their employees access to a health insurance plan,
or to subsidize such a plan. There is no such ‘employer mandate.’”
(bold in the original). Rather, the Affordable Care Act imposes a tax on
large employers in order to have them share in the cost of paying for
the new national entitlement to health insurance. This is also how
Social Security works: employers pay taxes to the government, which in
turn pays Social Security benefits to individuals. However, unlike
employers in the Social Security system, large employers in the ACA also
have an option to offer a health insurance plan directly to their employees,
which is what Hobby Lobby is doing, and then to escape the new tax
entirely. But the courts that have been examining the issue have
wrongly characterized this tax system as a series of fines or penalties
on employers for not covering their workers. This is plainly wrong. In
fact, the statute calls the direct payment to the government a “tax,”
and the tax payment that Hobby Lobby or any other large business would
pay, for reasons Lederman explains in detail, “is almost certainly far
less
than the employer would spend on insurance premiums and/or outlays if
it offered its employees a health-insurance plan.” (emphasis in the
original)
Thus, as the Fourth Circuit Court of Appeals stated in the
Liberty University case,
the ACA “leaves large employers with a choice for complying with the
law—provide adequate, affordable health coverage to employees” or else
“pay a tax,” a tax under the law which the Fourth Circuit, no liberal
court, described as “proportionate” and not “punitive.”
By explaining how the ACA really works with respect to the employers,
Lederman properly frames the RFRA and constitutional questions. Since
Hobby Lobby can simply pay its tax (and
save money along the
way), it must prove that payment of the ACA tax would itself constitute
an impermissible “substantial burden” on its religious free exercise.
That proposition is, of course, absurd since the company’s tax dollars
already go to support Medicaid and Medicare, and the Supreme Court has
never found, nor could it find, that taxing people (or corporations!) to
provide contraception or abortion services violates their religious
free exercise rights. If that were the case, every Quaker pacifist in
America would be getting a rebate for that portion of his or her tax
dollars going to military spending, every Scientologist would be getting
a rebate for psychiatric services paid for by the military or federal
prisons, and every Christian Scientist would be getting a rebate for
that portion of his or her taxes going to pay for any conventional
medical care at all. It simply does not “substantially burden” anyone’s
religion to pay the government taxes for public services that they
disagree with, such as war and military spending, the draft, Social
Security, psychiatric services, or contraceptive education and coverage.
The Supreme Court in
United States v. Lee, 455 U.S. 252
(1982), rejected an argument by an Amish employer that he should be
exempt from paying Social Security taxes for his employees because it
violated his religious faith, a decision that simply precludes any
effort to assert that the Obamacare tax itself violates RFRA or Free
Exercise. Furthermore, as Lederman observes, “a central component of
plaintiffs’ own RFRA arguments is that a ‘less restrictive’ means for
government to further its
interests without substantially burdening plaintiffs’ religious exercise
would be for the government to use its own revenues to subsidize
contraceptive use by Hobby Lobby and Conestoga Wood employees. Well,
that is exactly what would occur if those employers were to choose to
make a [tax] payment rather than offering their employees access to an
employer plan.” (emphasis in the original)
In short, even if corporations were persons with a religious
conscience, and even if it authentically offended the religious
sentiments of these corporate persons to have to pay a third-party
health insurance provider for making certain contraceptives available to
employees, there would still be no problem under RFRA or the Free
Exercise Clause because the affected corporations can simply pay a tax
instead.
The Religion of Business, the Business of Religion
Hobby Lobby is a case whose major claims would not have a prayer in any other Court at any other time. Yet, the
Citizens United
Court has made a religion out of business, so it is only natural that
some people will now want to make a business out of religion.
But it is time for the Court to restore some reality to the
conversation. Business corporations do not belong to religions and they
do not worship God. We do not protect anyone’s religious free exercise
rights by denying millions of women workers access to contraception.
And, as a matter of fact and law, employers are not being forced to
purchase insurance plans at all for their workers because they can pay a
simple and cheaper tax instead. The
Hobby Lobby case is a tissue of misunderstandings, propaganda, and excruciating extrapolations from the
Citizens United decision. It might be nice if the Court used the occasion of this train wreck of a case to rewind the tape on
Citizens United. But some things may be too much even to pray for.
* * * * * * *
Jamie Raskin is a professor of constitutional law at American
University, a Maryland State Senator, and a Senior Fellow at People for
the American Way Foundation.