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Introduction
Mr. Chairman and members of this subcommittee, it is an honor and a privilege
to be here today to provide you my perspective on H.R. 382, the Solid Waste
International Transportation Act of 2003, H.R. 411, to direct the Administrator
of the Environmental Protection Agency to carry out certain authorities under an
agreement with Canada respecting the importation of municipal solid waste, and
for other purposes, and H.R. 1730, the Solid Waste Interstate Transportation Act
of 2003. I should state that I am not here representing any client interest on
this matter and the views I am expressing are my own. It is my sincere hope that
my views will provide the subcommittee with information it considers useful in
informing your debate concerning the proposed legislation under consideration.
Please allow me to begin by noting that I spent more than fifteen years in
the Office of the U.S. Trade Representative (USTR) within the Executive Office
of the President (EOP). My last position in USTR, which I left in 2000, was
Assistant U.S. Trade Representative in which one of my principal
responsibilities was to direct U.S. trade relations with Canada and Mexico and
serve as the U.S. coordinator of the North American Free Trade Agreement (NAFTA)
trilateral work program with Canada and Mexico. Prior to that I held a number of
positions in which I was directly involved in the negotiation and implementation
of trade and foreign direct investment agreements and the implementation of U.S.
trade laws and policy.
Please also allow me to note that I appreciate the interest and genuine
concerns in a host of communities surrounding the treatment of municipal waste.
It is something that deserves serious consideration by policymakers and
appropriate measures at all levels of government to ensure that communities have
the means and the proper policies in place to contain and deal safely and in an
environmentally sound manner with such waste. It is quite clear that this has
been a topic of concern in many communities for many years, and the issues
involved are not getting any easier.
International Policy Considerations
My purpose for being here today is to discuss the international policy
considerations surrounding these bills. More specifically, I hope to inform the
subcommittee of considerations that I believe are important as they relate to
the development and implementation of U.S. trade policy and agreements when
considering these bills.
I think it is first germane to note that there is nothing in trade agreements
to which the U.S. is a party that says that federal, state or municipal
authorities cannot pursue policies that are intended to protect the environment
or human health. In fact, on an international level the U.S. is a party to
numerous agreements that are designed to protect the environment and protect
human health. Furthermore, as you well know, there are a myriad of state and
municipal laws designed to pursue these same purposes.
At the same time, the U.S. is also a party to numerous international
agreements designed to facilitate the flow of international trade and
investment, including the agreements under the jurisdiction of the World Trade
Organization (i.e., the General Agreement on Tariffs and Trade (GATT), etc.),
the NAFTA and numerous additional regional and bilateral agreements. These
agreements are instrumental in protecting U.S. commercial interests in the U.S.
market and abroad as we seek opportunities in the global marketplace.
Furthermore, as is the case with our adherence to international environmental
agreements, they tend to help create a world that is more productive and safer
than it would otherwise be in their absence.
So my approach to the bills under consideration today is one in which I
believe it is important to fully consider the consequences of any actions we may
take and to consider the nature and obligations of the agreements for which we
have already entered into with foreign nations. In my view, these are very
serious considerations and I do not subscribe to the view that protecting the
environment and human health in the U.S. is necessarily in conflict with the
maintenance and advancement of an effective U.S. trade policy. Quite the
contrary in some instances, a number of the international trade agreements we
have entered into explicitly encourage governments, ours included, to continue
and even step up efforts to protect the environment and human health.
A Discussion of the Bills in Question
With all this in mind, please allow me to raise some considerations with
regard to the bills in question, turning first to H.R. 382, then H.R. 411 and
then H.R. 1730. I will then conclude with a few general considerations for the
subcommittee to consider.
I think it is evident that there is a rise in concern among citizens in
certain parts of the United States regarding the importation of municipal waste,
principally from Canada. The volume of the international trade, and specifically
imports from Canada, is fueling citizen complaints about a variety of
considerations: the impact on traffic volumes, highway and road conditions, air
pollution, land fills, incinerators and the environment surrounding such sites,
and the potential consequences for human health. Irrespective of where the waste
originates from, all these issues deserve careful consideration and thoughtful
responses.
H.R. 382, H.R. 411 and H.R. 1730 approach these specific concerns from
different angles. H.R. 382 and H.R. 411 more explicitly address the issue with
international trade considerations in mind, although H.R. 1730 does not
eliminate the prospect of international trade obligations considerations.
H.R. 382
H.R. 382 authorizes states to "enact a law or laws prohibiting or
imposing limitations on the receipt and disposal of foreign municipal
waste." Presumably the purpose behind this proposed legislation is to give
states the right to act to shut down or limit imports, and presumably a state or
some states may exercise that right otherwise one has to question the
fundamental purpose of the proposed legislation.
Should a state take action to limit or prohibit the importation of the items
in question, in this case municipal solid waste, a fundamental premise of U.S.
international trade obligations that is reflected both in the GATT and the NAFTA
would be implicated - the so-called "national treatment" principle,
which is enshrined in Article III of the GATT and in Article 301 of the NAFTA.
Furthermore, GATT Article XI and NAFTA Article 309, which prohibit the
implementation of quantitative restrictions, would also be implicated.
Accordingly, the country whose trade was impacted by such action by the U.S.
would be afforded the right to pursue dispute settlement under the terms of
those agreements, including the right to enforce those agreements should they be
found to be breached by a dispute settlement panel.
Should a state take such action as provided for under H.R. 382, one may argue
that such actions were justified on the grounds that they were premised on the
protection of the environment and human health. However, in the absence of
equivalent action to shut down, or limit, the utilization of the relevant
landfills, for example, by all users, including those within the state in
question and the U.S. on environmental and/or human safety grounds, it is highly
questionable that the exceptions available under GATT Article XX and NAFTA
Article 2101 would be viable. Furthermore, the burden of proof falls on the
party taking the discriminatory action to show that the action is not "a
means of arbitrary or unjustifiable discrimination between countries where the
same conditions prevail", is not "a disguised restriction on
international trade" and is "necessary to protect human, animal or
plant life or health." In short, the threshold for these exceptions is
purposely very high.
H.R. 411
This bill attempts to address the concerns that have arisen in a different
manner. Specifically, it chooses to focus on the existing bilateral agreement on
the transboundary movement of hazardous waste - later augmented with respect to
municipal waste - which the U.S. has with Canada and its implementation. Mind
you, that agreement, first signed in 1986, seeks to ensure that the treatment of
waste that flows across our border is "conducted so as to reduce the risks
to public health, property, and environmental quality." Furthermore, the
agreement recognizes that the realities of being neighboring sovereign states
means that the appropriate treatment of this waste "may involve the
transboundary shipment" of such waste. In short, there has been a long
history of trade in waste, both hazardous and non-hazardous, between the U.S.
and Canada. This should not surprise anyone given the depth of the economic
relationship. Furthermore, both countries have officially stated their intent,
through this agreement and other domestic actions, to properly treat such trade
in waste in a manner that is safe and environmentally sound.
Should the U.S. chose to unilaterally re-interpret the provisions of this
agreement in a manner that causes concerns in Canada, Canada could withdraw from
the agreement. Or, Canada could unilaterally re-interpret the agreement in ways
that may implicate U.S. shipments of waste to Canada, which I understand are
significant. In other words, the practical implications of any U.S. effort to
interpret or enforce the agreement in a manner that Canada finds objectionable,
could lead to similar actions on the part of Canada, or Canada's withdrawal from
the agreement altogether. If the agreement were to be, in effect, voided, the
international trade obligations of the United States under the WTO and the NAFTA
would also remain in force, as they do now. A question to consider is whether
unilaterally interpreting the existing agreement on transboundary waste in a
manner that invites "mirror action", or some other adverse
consequence, by Canada is ultimately in the interests of the United States,
particularly when Canada is such a significant destination for U.S. hazardous
waste.
H.R. 1730
This bill is ostensibly designed to empower local communities through new
"host community" agreements with regard to waste management. It
includes language that would encompass foreign waste, although on its face it
does not treat foreign waste differently than it does domestic U.S. waste. As a
result, it does not appear to raise any direct issues that could implicate U.S.
international trade obligations. Although, were such legislation to be enacted
it is conceivable that if the implementation of the legislation by a state were
to succumb to action(s) that discriminates in its treatment of foreign waste it
could have implications for U.S. international obligations.
Additional Policy Considerations
In addition to the issues that I have already raised, another consideration
has to do with the role of individual states in the conduct of U.S. trade
policy. Irrespective of the fact that congress can authorize states to conduct
their own respective foreign and domestic trade policies, the notion that the
congress would authorize individual states to, in effect, conduct their own form
of international trade policy raises some issues, not all of which are likely to
be helpful to U.S. interests in the world. I do not want to overstate the
potential concern, but in my view congress should think very carefully about the
prospect of respective individual states undertaking distinct, and possibly
conflicting, foreign trade policies, even if these policies are very narrowly
focused on specific products. The constitution provides congress the sole
authority to regulate commerce (both domestic and foreign) and the President the
authority to negotiate on behalf of the U.S. with foreign powers. Those
authorities are well considered and have served the U.S. well throughout its
history. I am not convinced that delegating such authority to the states is
necessarily in the nation's interest in the broader global environment. It may
lead to more problems than it is worth, although I am in no way attempting to
denigrate the validity of concerns that surround the treatment of waste in
localities.
Conclusion
I hope my testimony will contribute constructively to the debate the
subcommittee will have with respect to these bills. The issues before you
deserve serious consideration and raise a host of interesting and overlapping
issues that "cross the paths" of local, state and national officials
in addition to having international implications. My own desire is that the
approaches that are eventually adopted at all these levels of government are, in
fact, guided by a fully informed and enlightened debate, and for that I want to
thank the subcommittee for its effort to do just that today.
Thank you Mr. Chairman and members of the committee.
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