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Eyes on Trade

Public Citizen's Global Trade Watch blog on globalization and trade


What's New – Global Trade Watch

  • April 18: Trump Buy American Order Good First Step, But Enacting EO’s Goals Will Require Elimination of Trade Pact Buy American Waivers for 59 Nations.
  • March 30: Draft NAFTA Renegotiation Plan in Official Fast Track Notice Letter Would Not Fulfill Trump’s Pledge to Make NAFTA ‘Much Better’ for Working People or Enjoy a Congressional Majority

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Act Now: Save your state from undemocratic trade rules on government procurement!

Act Now: Save your state from undemocratic trade rules on government procurement!

 Memo to State Leaders: Urgent Action Needed to Prevent Preemption of State Procurement Policy by CAFTA Terms

The Bush administration is moving ahead with its underhanded effort to get governors to bind their states to the procurement rules in an array of new trade agreements including the Central American Free Trade Agreement (CAFTA), the proposed Free Trade Area of the Americas (FTAA), and many more. These rules rob state legislatures of their authority to decide how state tax dollars are spent and put an array of common purchasing policies at risk - giving closed-door trade tribunals the final word.

Common state purchasing policies that would be prohibited under these "trade" rules include preferences for recycled content and renewable energy, bans on products made with sweatshop labor, living wage and prevailing wage laws, and preferences for locally-produced goods and services - including the anti-offshoring legislation now pending in more than 30 states.

Here's how you can help ensure that your state is not trapped by the procurement rules!  

  • View your state's profile to find out how your governor responded to the USTR's request.
  • Call your governor's office. If your governor committed your state to the rules, urge that she or he withdraw the state from the list. If your state has not responded, ask the governor's office to turn over the request to the legislature for their consideration.  
  • For more information, sample materials, and additional action ideas, contact Saerom Park at 202-454-5127 or


Earlier this year, a letter from the Bush administration to state governors revealed a sneaky attempt was underway to get governors to "voluntarily" commit their states to comply with draconian constraints on domestic procurement (purchasing) policy included in all new trade pacts under negotiation.  Governors were asked to commit states to comply with whatever procurement rules result from negotiations - effectively to deposit an open signature card for future pacts with unknown requirements. Among the pacts that were listed to be covered were CAFTA, the proposed FTAA, and a slew of bilateral agreements.  

If a state signs up and agrees to comply with the procurement provisions of these agreements, the following policies are prohibited, meaning existing policies that do not conform must be changed, and states are prohibited from establishing such policies in the future:

  • "No off-shoring" and other local development policies aimed at keeping state dollars paying in-state wages and giving preference to locally-produced goods and services;
  • "Green" procurement policies such as those requiring recycled content, fuel efficiency, energy efficiency or renewable energy;
  • Prevailing wage, living wage and project-labor agreements as well as pro-union or pro-public bidding assistance;
  • Policies that prohibit purchases of goods made in sweatshops or goods made with slave labor; and
  • Preferences used to demand corporate responsibility in the face of human rights abuses -- such as those used to help bring an end to apartheid in South Africa and now in place regarding Burma.

Other nations that are party to these agreements are empowered to challenge a nonconforming state policy (no matter when it was established) as a violation of the agreement in a binding dispute resolution system established in the text. State government officials have no standing before these tribunals and thus must rely on the federal government to defend a challenged policy. The tribunals are staffed by trade officials who are empowered to judge if state policy has resulted in a violation. Policies judged to violate the rules must be changed, or trade sanctions can be imposed. As well, the federal government is obliged to use all constitutionally-available powers - for instance preemptive legislation, lawsuits and cutting off funding - to force state compliance with tribunal rulings.

To make matters worse, the process that USTR is using to seek "consent" from states is highly questionable legally. Setting government procurement policy and deciding whether to cede to policy constraints imposed by a trade agreement is within the realm of state legislatures, not the executive branch. A note from the Governor to the USTR on policy matters with such deep and broad implications should not be allowed to override the constitutional authority of state and local elected officials. Yet if a state is listed when an agreement is approved by Congress, that state becomes bound even if the initial sign-on process was not legal!

More and more people are becoming aware of the implications these pacts, and constituents in many states are demanding that their governors communicate to the USTR that their state will not be bound by the rules.  State legislators are demanding notification and consultation regarding trade rules with such significant implications for their policy-making authority.  The USTR has heard these initial rumblings.  Yet, instead of rectifying the shortcomings of the process used to consult with states, it has continued its recruitment effort and is circulating yet more misinformation about what these rules actually mean for state sovereignty.

That's were you come in.  It's a crucial time to make sure your state and local officials know that some "trade" rules negotiated behind closed doors without their input - much less their approval - are about to permanently shut down their right and authority to decide the conditions under which state tax dollars as spent.  












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