When government officials express intent to disparage or discriminate against a group, the constitutional consequences can be severe, but they are rarely imposed. In this Article, I argue that discriminatory motive is, and should be, enough to declare government acts unconstitutional. Second, I argue that the main reason why is the harm it causes to government legitimacy. While some argue that the concern with intentional discrimination is its harm, such as stigmatizing effect, I argue that the focus should not be on harm, but on how it delegitimizes government. I make the descriptive claim that constitutional doctrine, in its broad outlines, reflects a legitimacy-based view. In the Equal Protection context, courts have set out how discriminatory goals are not legitimate state interests. In the executive action context, courts state that absent a legitimate and bona fide justification, the Executive may not have power delegated from Congress to act. What courts have not done is specified what happens when the hammer falls: how intent disables government policymaking and for how long. The legitimacy-focused approach can neutralize government decisions, even when the government tries to re-do its policy and claim new reasons. Third, I argue that the legitimacy-focused approach toward constitutional intent doctrine that I advance in this Article is normatively preferable. The approach does incentivize insincere reasons for government actions. However, I argue that the advantages outweigh those costs. There are real benefits to even insincere expressions of non-discrimination. Conversely, when the government makes discriminatory statements, this is very strong evidence of discriminatory motive. During a time of nationwide litigation of intentional discrimination claims in areas including immigration rights, voting rights, and religious non-establishment, it has never been more important to set out the doctrine, the costs, and the consequences of unconstitutionally illegitimate intent.
Issue 8
A “Corporate Democracy”? Freedom of Speech and the SEC
In Citizens United, the Supreme Court stated that increased recognition for corporate speech rights is not problematic because corporations are themselves mini-democracies; shareholders have mechanisms to check management control over corporate speech. But due to statutory changes and judicial actions, these checks and balances are no longer effective. Managers have nearly unbridled power over corporations’ expanded speech rights, allowing them to use companies as outsized megaphones for their own personal political and social positions.
An axiom of First Amendment doctrine is that the remedy for speech that some find problematic is “more speech, not enforced silence.” Thus, if the increase in speech rights for corporate managers is an issue, the solution is not to rein in those rights but rather to see how investors’ speech is limited and to remove those barriers, enabling investors to fully participate in the corporate democracy.
Securities and Exchange Commission (“SEC”) regulations prohibit investors from communicating about corporate elections without filing disclosures and providing proxies to every shareholder. These regulations limit investor speech and are slanted in favor of management because they exacerbate the collective-action problem among shareholders who oppose poorly performing managers. Investors should challenge these regulations on First Amendment grounds, and courts should apply some form of exacting scrutiny because speech in corporate elections is as important as political speech in many circumstances. Striking down these regulations would restore balance to the investor–management relationship and allow corporate speech to fully reflect the will of companies’ true owners: their shareholders.
Administrative Rationality Review
Under the familiar rational basis test, a court must uphold a challenged statute if there is any conceivable basis to support it. Courts routinely accept speculative—even far-fetched—justifications that few would describe as “rational” in a colloquial sense. Modern rational basis review typically is justified as a necessary concession to the nature of the legislative process. The puzzle is why courts apply this same deferential standard when reviewing constitutional challenges to administrative agency actions. Neither courts nor scholars have explained why administrative agencies—which share few of the features of democratically accountable legislative bodies—should enjoy the same degree of judicial deference to their decisions. In many states and localities, this permissive rationality standard is all that constrains the decisions that agencies make. This Article argues that there is in fact no justification for the prevailing approach and that as a constitutional matter courts have an obligation to scrutinize agency regulations more closely than they do legislative enactments. Courts must ensure that agencies at all levels of government act on the basis of actual reasons, and there is at least a plausible connection between regulatory means and ends.