Sharp: Hobby Lobby lessonsWritten by Kenneth Sharp | | email@example.com
T he Hobby Lobby opinion announced at the close of the Supreme Court’s term has ignited a firestorm between deeply divided sides. What is missing from the debate is how the decision illuminates how our system works.
The decision pertains to “closely held” corporations — privately held companies that have 50 percent or more of their stock value held by five or fewer individuals (according to the Internal Revenue Service definition). Closely held corporations still employ a great number of people, perhaps as many as 29 million, according to figures from the U.S. Census Bureau (according to the Pew Research Center).
So why do the few shareholders in a privately held corporation get to tell the employees what will be paid for under a government-mandated insurance program? Again, working back from the decision, the grounds were laid by the Affordable Care Act, The Religious Freedom Restoration Act (RFRA) and the Constitution. The main focus was on the RFRA, enacted in 1993, signed by President Bill Clinton and passed by a unanimous House of Representatives and a nearly unanimous Senate (three dissents). As usual, this law was intended to clean up the mess from earlier sweeping legislation including the misguided and horribly costly War on Drugs.
In a particular example (Employment Division v. Smith), two Native Americans were denied federal benefits for the use of peyote (a traditional natural drug) in religious ceremonies. The RFRA was intended to allow, without federal government intrusion, free exercise of one’s legitimate faith. The Hobby Lobby decision wasn’t judicial activism by the Court, as it usually isn’t. Congress has created more than enough laws with more than enough loopholes to allow nearly any opinion by the Court. Also, as usual, a sweeping government answer has created more problems.
Does Hobby Lobby exercise religion? This brings in the thorny issue of corporate personhood. This is not a new issue and has been before the Court numerous times since the 1800s. The government wants to encourage business. It recognizes freedom of assembly and that when people act in concert toward a specific goal certain rights are beneficial
To that end, among the rights afforded, corporations are allowed to sue and be sued, own property and enter into contracts while the shareholders are not liable beyond their investment for debts. In fact, the U.S. Code § 1, states, when determining the meaning of an act of Congress, “the words ‘person’ and ‘whoever’ include corporations, companies, associations, firms, partnerships, societies, and joint stock companies, as well as individuals.”
However corporations have been denied Fifth Amendment privileges against self-incrimination and the right to vote, as these were determined to be strictly individual rights. So the Court has now determined that the free exercise of religion is a collective as well as individual right for some corporations. But what of the employee’s rights when government mandates? Here we go further down the rabbit hole. Hobby Lobby’s owners aren’t denying access, just refusing to pay.
The real question that needs to be asked is: Why are employers involved in employees’ health care at all? Back to government interference — this time during World War II. When the government established wage controls for the war effort, businesses began to incentivize workers with health benefits to attract and retain workers. Eventually this led to the expectation of these benefits and began to include subsidies from the government to corporations for providing them.
What is the Hobby Lobby lesson? That sweeping government answers to problems like wage controls, drugs, religious freedom and health care often create greater harm than the problems they sought to solve. They do so by concentrating power and further reducing the choice of the individual. The result is usually dependence and calls for more government action.
The Court sought a narrow answer to a question that never should have been presented. Corporations are a fiction of government and government is a fiction of the people. Government is also nothing more than force. To answer how we wish to use that force, we must answer how we wish to be used by that force.
Kenneth Sharp can be reached at firstname.lastname@example.org.