Boston Phoenix: Supreme Challenge

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The Boston Phoenix
July 15 - 22, 1999
Politics by Ben Geman

Supreme challenge
Attorney General Tom Reilly's defense of the controversial Burma law could
prove he's more than just a tough-on-crime prosecutor

Back up a few months in the life of Attorney General Tom Reilly. He was in
the thick of the election season's muddiest fight, slugging it out with
State Senator Lois Pines of Newton to win the Democratic nomination for the
state AG's job.

Reilly -- who made his reputation as the tough-bordering-on-overzealous
district attorney of Middlesex County -- was being knocked by Pines for
holding what she believed was too narrow a view of the AG's office. The
attorney general, said the Pines campaign, should be more than just a
prosecutor on steroids. Boston Globe columnist Eileen McNamara flogged the
point: "By all appearances," she scolded last September, "Reilly sees the
post as no more than a glorified district attorney."

Well, score a point for the Reilly side. His office announced this week
that it will wade into the foreign-policy arena by petitioning the Supreme
Court to reverse a federal-court decision that struck down a state law
barring Massachusetts from giving contracts to companies that do business
with the country of Burma.

The repressive military junta that rules Burma (renamed Myanmar by the
regime) has been in the crosshairs of human-rights activists for years. In
1990, it ignored the results of an election that would have put the
National League for Democracy in power. Activists say it has wiped out
political expression consistently and sometimes violently, used forced
labor to build its infrastructure, and censored and intimidated the leader
of the democracy movement, Aung San Suu Kyi.

The state law was the project of State Representative Byron Rushing
(D-Boston), human-rights activist Simon Billenness, and others. Since
passing the legislature in 1996, it has been shot down twice by federal
courts after challenges from a coalition of large corporations called the
National Foreign Trade Council (NFTC). Last year, Boston federal-court
judge Joseph Tauro struck down the law, ruling that it improperly allowed
states to set foreign policy. Then-attorney general Scott Harshbarger
appealed, but last month, the First Circuit Court of Appeals upheld the

ruling. According to the appeals court's unanimous decision, "the conduct
of the nation's foreign affairs cannot be effectively managed on behalf of
all the nation's citizens if each of the many state and local governments
pursues its own foreign policy."

But Reilly and other backers of the law say the case is less about foreign
policy and more about the power of cities and states to apply moral
criteria to their purchases -- the way citizens do when they boycott brands
for reasons of politics or principle.

The Supreme Court challenge could end with a whimper instead of a bang: the
court accepts only a small fraction of the cases it is asked to hear. If
the court does hear the case, though, its decision will have implications
not just for Massachusetts, but for any city or state that wants to use its
buying power to pressure repressive governments into reform. Although
Massachusetts is so far the only state to enact selective-purchasing
legislation related to Burma, such laws are pending in several other states
and are already on the books in dozens of cities, including New York, Los
Angeles, and Portland, Oregon.

"It's a high-stakes gamble," says Billenness, a member of the New England
Burma Roundtable and an analyst with Trillium Asset Management, a socially
conscious investment firm. "If they uphold the decision, it nationalizes
the decision, and that would strike down Burma laws across the country. And
also, a range of other laws would be at risk. What's at risk here is the
right of citizens to ensure their tax dollars are spent in accordance with
their moral principles."

"Is it a gamble? Certainly," says Reilly. "Any time you litigate any matter
there is a risk or a gamble, but there are important matters at issue here,
important enough to fight for."

Reilly's actions on Burma, a welcome sign for those who want to see the
Massachusetts law survive, also give hope to those who believe the role of
the attorney general should be an activist one. But this isn't the first
encouraging signal he's given those observers so far in his young term.

Reilly has taken an aggressive stance on the proposed Fleet-BankBoston
megamerger, arguing that, in order to create a strong competitor, one large
out-of-state bank should be granted permission to gobble up the branches
that Fleet and BankBoston would be forced to divest. This bucks the wishes
of many state politicians, who believe smaller community banks should be
allowed to divide the cast-off branches among themselves.

Reilly has also criticized the planned merger between Boston Edison and
Commonwealth Electric, calling a proposed plan to freeze rates for several
years an inadequate gesture to consumers. "The rate freeze deprives
customers of rate decreases, to the enrichment of shareholders," Reilly
told the Boston Globe last month.

"I would say that he is just getting his stride, and we are encouraged by a
few of the early actions he's made," says Rob Sargent, legislative director
of the Massachusetts Public Interest Research Group, which has been
critical of the utility-merger plans. Bruce Marks, executive director of
the Neighborhood Assistance Corporation of America, a community advocacy

and housing group, is also pleasantly surprised by what he's seen so far.
"Certainly the perception was that he would look at just people who rob and
steal with a gun or a knife," he says, commenting on Reilly's bank-merger
position. "But now he has shown he is looking at entities that rob and
steal with a stroke of a pen."

Now, by looking across the ocean, Reilly could make waves not just in
Massachusetts but around the country and even the world. The 1996
Massachusetts law is among those credited with changing the behavior of
several large companies. Apple Computer and Eastman-Kodak, among others,
have cited such laws as reasons for pulling out of Burma.

But these laws have angered many US trading partners, who complain that
such legislation violates free-trade principles. The European Commission
and the government of Japan have complained to the World Trade Organization
that the Massachusetts law runs afoul of an international agreement on
contract bidding.

Mainly, though, the war on selective-purchasing laws, and the Massachusetts
law in particular, is being waged by the NFTC, which has more than 500
member corporations. This represents real muscle -- corporate board members
of the NFTC include Texaco, Monsanto, and General Electric.

The NFTC calls unilateral sanctions bad for business. Selective-purchasing
laws, says NFTC president Frank Kittredge, would hurt companies doing
business with Burma without really influencing the Burmese regime, because
a government can always find other suppliers. "The selective-purchasing
laws," he says, "are feel-good measures that don't work." What's more, he
adds, the laws make US suppliers "unreliable" in the global marketplace.

Although the fight over the Massachusetts law largely pits big business
against human-rights advocates and sympathetic politicians (many members of
Congress expressed their support to the appeals court), even some on the
left share the trade council's opposition to selective purchasing. One
long-time Boston-area progressive activist agrees with Kittredge, arguing
that the Burma law is more about making liberals in Massachusetts feel good
about themselves than about effecting change in Burma. "This is Newton
liberalism," says the activist, who asked for anonymity, arguing that the
Burmese regime's self-isolation limits the impact of outside pressure.

Reilly's office, however, insists that states should have the right to make
decisions based on the human-rights priorities supported by their own
legislatures. Backers of the law point out that the foes of South African
apartheid demonstrated the value of applying moral criteria to investment
and business.

The Burma law "is a decision about how the state wants to spend its own
funds," says Tom Barnico, the assistant attorney general working on the
case. "We say we can apply a moral principle to our spending decisions."

Adds Reilly: "It is really about the rights of a state, the rights of
Massachusetts and other states, to advocate for human rights . . . we feel
very strongly that the state takes positions against regimes that violate
human rights."


Byron Rushing believes there's even more at stake here. Simply put, he
says, it's a decision about whether, in a globalized economy, corporations
have any accountability at all. The NFTC, says Rushing, "doesn't want
popular grassroots democratic actions to affect any of the business they
do, anytime, anywhere, anyplace.

"This is the tyranny of corporate America at work," he adds. "They see this
[the Burma law] as an intrusion on their ability to run their corporations,
and we don't believe American corporations should have unlimited power."

In this case, at least, Reilly doesn't either.

Ben Geman can be reached at bgeman@xxxxxxxx

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