The Court held today in Davenport that because a public-employee union possesses nonmember feepayers’ funds only because of special state-conferred privileges, the state can place a content-based condition on the union’s use of those funds — namely, that the union obtain the feepayers’ consent before using the funds for election-related activity.
That is in form exactly the same rationale that the Court has used in the past — most notably, in Austin v. Michigan Chamber of Commerce — to justify upholding laws that require corporations to use segregated funds outside their treasuries (in effect, a shareholder consent requirement) for election-related activity.
And it is precisely that question that is raised anew in the pending Wisconsin Right to Life case — whether Austin remains good law, in which case the Court should uphold Congress’s rule that corporations must use segregated funds to pay for election-related speech. (The plaintiff in WRtL argues that the Austin segregated fund rule should not extend to certain sorts of corporate expenditures that ostensibly are issue- (rather than candidate-) related, at least in part. But the union expenditures in Davenport were entirely issue-related — the elections in question were voter referenda on ballot propositions.)
Indeed, under Austin itself, such a restriction is more constitutionally defensible as applied to corporations than as applied to unions. In Austin, the Chamber of Commerce had argued that the Michigan law was fatally underinclusive because it applied only to corporations and not to unions. The Court rejected that argument, reasoning (494 U.S. at 665):
Whereas unincorporated unions, and indeed individuals, may be able to amass large treasuries, they do so without the significant state-conferred advantages of the corporate structure; corporations are “by far the most prominent example of entities that enjoy legal advantages enhancing their ability to accumulate wealth”. The desire to counterbalance those advantages unique to the corporate form is the State’s compelling interest in this case; thus, excluding from the statute’s coverage unincorporated entities that also have the capacity to accumulate wealth “does not undermine its justification for regulating corporations.â€
The Court further explained that “an employee who objects to a union’s political activities . . . can decline to contribute to those activities, while continuing to enjoy the benefits derived from the union’s performance of its duties as the exclusive representative of the bargaining unit on labor-management issues. As a result, the funds available for a union’s political activities more accurately reflects members’ support for the organization’s political views than does a corporation’s general treasury.” Id. at 665-666.
If a law such as that at issue in Davenport is constitutional, and (as Austin holds), the rationales supporting such a law apply with greater force to corporations, then it does not appear that the Court could invalidate the law in WRtL without turning the union/corporation distinction of Austin completely on its head.
That is to say, Davenport spells doom for the plaintiff in WRtL — unless, of course, this Court takes a very different view than the 1990 Court of the relative state-conferred advantages of unions and corporations . . . something we should find out in the next two weeks.
CLICK HERE FOR FULL VERSION OF THIS STORY