Fiscal Note
No expenditure is required.
Title
Establishing that the City of Madison opposes the expansion of the North American Free Trade Agreement (NAFTA) by opposing the ratification of the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA or CAFTA), now pending in the U.S. Congress, as well as the Free Trade Area of the Americas (FTAA), currently under negotiation, as they undermine the sovereignty of the Madison Common Council to legislate in the best interest of the residents of the city of Madison and because NAFTA, the model for these agreements, has proven a human rights and humanitarian disaster for working people, both in the United States and in Mexico.
Body
WHEREAS, the Madison Common Council supports expanding international trade and investment as means to achieving economic and social benefits for Madison, for Wisconsin and for the United States, as well as for our international trading partners; and
WHEREAS, the United States government is negotiating expansion of the North American Free Trade Agreement (NAFTA) with 34 countries in the western hemisphere to create a Free Trade Area of the Americas (FTAA) forming a single set of trade and investment rules among member countries; and
WHEREAS, as a step toward the creation of the FTAA, the United States government has already negotiated a Central American Free Trade Agreement (CAFTA) that will be submitted to Congress for approval in June 2005; and
WHEREAS, the state of Wisconsin has already suffered the loss of thousands of manufacturing jobs under NAFTA, the model for CAFTA and the FTAA; and
WHEREAS, in the decade since NAFTA took effect, the state of Wisconsin has lost nearly half of its family dairy farms and over $200 million in beef exports; and
WHEREAS, without setting enforceable standards for minimum labor and environmental protections, CAFTA and the FTAA could escalate this race to the bottom in which nations compete for foreign investment by offering the lowest wages and weakest labor and environmental protections to the detriment of their populations; and
WHEREAS, the scope of free trade agreements has expanded beyond federally controlled trade related activities, such as customs regulation and establishment of tariff structures, to include areas at the core of traditional state and local government authority; and
WHEREAS, the goal of these trade and investment agreements is the removal of perceived barriers to trade, which oblige the federal government to take all available steps to force compliance from state and local governments including suing state and local governments, enacting preemptive legislation, or withholding federal funds, when state or local laws and regulations are found to be non-compliant with international trade agreements; and
WHEREAS, federal trade obligations may force municipalities to rescind or weaken regulations in areas such as economic development, government purchasing, consumer and environmental protection, wages, and working conditions; and
WHEREAS, investor protection rules in NAFTA (Chapter 11) and CAFTA (Chapter 10) grant foreign corporations the right to sue the U.S. government for anticipated and actual lost profits due to state and local governmental regulations, in contradiction to long-established interpretation of the takings clause of the 5th Amendment of the U.S. Constitution; and
WHEREAS, NAFTA's Chapter 11 has already generated two "regulatory takings" cases against the U.S. for state governments' environmental and public health policies; and
WHEREAS, the investment provisions of CAFTA and FTAA affect state and local powers, including, but not limited to, zoning, protection of groundwater and other natural resources, corporate ownership of land and casinos, law enforcement by courts, public services, and sovereign immunity; and
WHEREAS, CAFTA and FTAA provisions could threaten Madison's Living Wage ordinance and Wisconsin's prevailing wage laws by deeming them impermissible trade barriers; and
WHEREAS, CAFTA and FTAA provisions could jeopardize vital local and state environmental laws, such as Madison's phosphorous lawn fertilizer ban and Wisconsin's stringent groundwater and wetlands protections; and
WHEREAS, CAFTA and FTAA provisions could preclude Madison's ability to establish future procurement policies that favor suppliers based on environmental, human rights, labor rights, minority opportunity or other factors; and
WHEREAS, CAFTA and FTAA include rules on services that could require the privatization of public services, regardless of the will of citizens and elected officials; and
WHEREAS, the City of Madison's regulatory structure and court system may be circumvented in certain cases by international arbitration panels that use international standards, ignoring local laws and preferences; and
WHEREAS, witnessing increasing conflict between international trade obligations and local and state authority, the National League of Cities, the National Association of Counties, the National Association of Attorneys General, and the National Conference of State Legislators, have requested from the United States Trade Representative (USTR) protection from these obligations, as well as greater consultation in the negotiation process;
NOW, THEREFORE, BE IT RESOLVED that the Madison Common Council opposes CAFTA and the FTAA for their provisions that threaten to undermine the Common Council's authority to address the vital public health, economic development, labor, and environmental concerns of its constituents without fear of challenge from foreign corporations, penalty from un-elected international arbitrations panels, or retaliatory federal action; and
BE IT FURTHER RESOLVED that the Madison Common Council urges the Wisconsin Congressional Delegation to oppose adoption of these trade agreements; and
BE IT FINALLY RESOLVED that it is the sense of this body that the Congress of the United States should pass legislation instructing the USTR to fully and formally establish a consultative process with state and local governments regarding procurement, services, investment, or any other trade agreement rules that impact state and local laws and authority before negotiations begin and as they develop, and to seek consent from state and local elected bodies prior to binding them to conform their laws to the terms of international trade agreements.