Subject: NEWS - Court to Balance Global Trade Vs. Local Activism
Tuesday, November 30, 1999 |
Court to Balance Global Trade Vs. Local Activism
Human Rights: Justices agree to rule on the
right of cities and states to rebuff companies
linked to repressive regimes.
By DAVID G. SAVAGE, Times Staff Writer
WASHINGTON--In a case that pits American
moral values against
the benefits of global free
trade, the Supreme
Court said Monday it will
decide whether cities
and states can refuse to do
business with firms
that operate under repressive
regimes in such
countries as Myanmar, Cuba or
China.
At issue in the
case from Massachusetts is
whether trade
restrictions imposed by states and
local governments
infringe upon the federal
government's
constitutional role as the nation's
arbiter of foreign
policy.
The case, which
the court will hear early next
year, pits human-rights
activists and many state
and local lawmakers
against American businesses
and some foreign firms.
The court's
decision to hear the case comes
as the World Trade
Organization faces protests
over, among other
things, the WTO's own
resistance to
considering humanitarian and
environmental issues in
setting economic policy.
During the 1980s,
most states and dozens of
cities expressed their
moral outrage at South
Africa's apartheid
regime by boycotting firms that
did business there. In
this decade, the military
regime in Myanmar,
formerly known as Burma,
has been targeted by
similar laws, including
ordinances in Los
Angeles and San Francisco, for
its human-rights
violations. Cuba, China, Nigeria,
Northern Ireland, Sudan
and Switzerland have
been targeted in other
ordinances across the
nation.
Some cities have
also said they will not do
business with global
firms that operate
"sweatshops" or that
fail to pay a "living wage."
Critics in the
business community have
decried these laws as
foreign policy-making by
cities and states. A
coalition of firms, led by the
U.S. Chamber of
Commerce and the National
Assn. of Manufacturers,
challenged
Massachusetts'
so-called Burma law, which
generally barred the
state from buying goods and
services from companies
doing business with
Myanmar unless there
were no other comparable
bids.
The European Union
and Japan also protested
the Massachusetts law
and joined in the legal
attack. They said
companies in Britain, Germany
or Japan should not be
forced to choose between
doing business with
Myanmar or Massachusetts.
In June, the U.S.
Court of Appeals in Boston
agreed and struck down
the state's law.
It agreed that
"human rights conditions in
Burma are deplorable,"
but ruled that only the
federal government can
impose economic
sanctions with
international reach. The U.S.
Constitution says the
nation must "speak with one
voice" in foreign
affairs, wrote Judge Sandra
Lynch, not through
dozens of local and state
governments. By
discriminating against firms that
do business in Myanmar,
"Massachusetts is
attempting to regulate
conduct beyond the borders
of this country," she
said.
Lawyers for
Massachusetts appealed to the
Supreme Court. They
were joined by California
and 14 other states, as
well as a host of
California cities,
including Los Angeles, San
Francisco, Oakland,
Berkeley and Santa Cruz,
which have enacted
similar restrictions.
Congress, Clinton
Support Sanctions
"Nothing in the
federal Constitution denies to
the states the right to
apply a moral standard to
their spending
decisions [or] requires the states to
trade with dictators,"
the state's lawyers said in
the case of Natsios vs.
National Foreign Trade
Council, 99-474. They
also noted that Congress
and the Clinton
administration have supported
sanctions against
Myanmar to protest human
rights violations.
The case will test
the court's conservative
majority and its
willingness to uphold liberal state
laws. In recent years,
the court's conservatives,
led by Chief Justice
William H. Rehnquist, have
steadily strengthened
the powers of the states.
Their states' rights
rulings have struck down
federal laws on guns,
religious liberty and Indian
gaming and freed the
states from paying overtime
to their workers. In
political terms, these laws
were generally
supported by liberals and opposed
by conservatives.
The new case will
turn the tables. Liberals
have championed the
human-rights measures
while big-business
lawyers have opposed the
restrictions.
Hofstra University
law professor Peter Spiro,
who has studied the
anti-Myanmar laws, predicted
the high court will
side with Massachusetts and
uphold its human-rights
measure.
"This could make a
fairly dramatic departure if
the court gives states
and local governments the
green light," Spiro
said.
In the past, the
court has said that any local or
state law that
interferes with foreign trade is
unconstitutional, he
said. But the current court has
been unwilling to read
the Constitution so strictly
as to tie the hands of
state officials, he said.
"In the context of
economic globalization, this
could be very
significant," he said.
The court's ruling
in the case may also affect a
series of environmental
measures.
For example, city
councils in several
cities--including Santa
Monica, San Francisco,
Ventura and Santa
Clarita--have passed
ordinances that forbid
local officials from
purchasing hardwoods
from tropical rain forests.
Many states and cities
also require the purchase
of recycled paper or
clean fuels.
Lawyers said a
broad ruling against local laws
that discriminate
against businesses could leave
such measures
vulnerable.
A ruling can be
expected by next summer.