US Power Shift Benefits Corporate America: the Hobby Lobby Ruling impact on US and EU US trade negotiations

Last month, as you’ve probably heard, a closely divided Supreme Court ruled that corporations with religious owners cannot be required to pay for insurance coverage of contraception. The so-called Hobby Lobby decision, named for the chain of craft stores that brought the case, has been both praised and condemned for expanding religious rights and constraining Obamacare. 

But beneath the political implications, the ruling has significant economic undertones. It expands the right of corporations to be treated like people, part of a trend that may be contributing to the rise of economic inequality.

The notion that corporations are people is ridiculous on its face, but often true. Although Mitt Romney was mocked for saying it on the campaign trail a few summers ago, the U.S. Code, our national rule book, defines corporations as people in its very first sentence. 

And since the 19th century, the Supreme Court has ruled that corporations are entitled to a wide range of constitutional protections. This was a business decision, and it was a good one. Incorporation encourages risk-taking: Investors are far more likely to put money into a business that can outlast its creators; managers, for their part, are more likely to take risks themselves because they owe nothing to the investors if they fail.

The rise of corporations, which developed more fully in the United States than in other industrializing nations, helped to make it the richest nation on earth. And economic historians have found that states where businesses could incorporate more easily tended to grow more quickly, aiding New York’s rise as a banking center and helping Pennsylvania’s coal industry to outstrip Virginia’s. 

The notion of corporate personhood still sounds weird, but we rely upon it constantly in our everyday lives. The corporation that published this column, for instance, is exercising its constitutional right to speak freely and to make contracts, taking money from some of you and giving a little to me.

Note EU-Digest: the above should be a clear warning to the EU not to sign any major trade agreement with the US wich has laws in place which gives profit based and not democratically run corporations the same legal rights and status as human beings.

Read more: What the Hobby Lobby Ruling Means for America - NYTimes.com