Foreign Policy Goes Local ; State Capitals Are Adopting Their Own International Relations and Trade

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In the US Supreme Court, Massachusetts is defending a state law that bans trade with the nation of Burma.

In Arizona, Gov. Jane Hull is hoping to test a new temporary work visa for Mexican laborers.

And here in Texas, state leaders have stepped up regular meetings with officials of the four Mexican states along Texas's border, to turn the border region into a single economic entity.

From one coast to the other, America's states are increasingly acting like the Greek city-states of antiquity, determining their own foreign policy and routes of trade. And like modern-day Spartas, their behavior is being driven by a less-centralized notion of "nation" at home, as well as a broader view of the world and its economic forces.

This new brand of federalism has its detractors, who see a state- by-state approach to trade policies as a hardship for business. But with globalization creating greater competition worldwide, and courts so far endorsing the trend, it's only going to continue, experts say.

In the very long term, "it's now possible to imagine a world where the United States does not exist as it has in the 20th century," says Peter Spiro, a law professor at Hofstra University in Hempstead, N.Y. "States are very intent on pursuing their distinct international interests, and if you're saying international interests, it makes a big difference whether you're sitting in Minnesota or New Mexico."

Nowhere is the growing power of states more obvious than along the US-Mexico border, especially in Texas, which accounts for 80 percent of the surface transportation of products between America and its neighbor to the south. There, under the influence of the North American Free Trade Agreement (NAFTA), state officials are meeting regularly with Mexican counterparts to hammer out the daily details of free trade, from water quality along the Rio Grande to truck emissions.

"The daily interaction along the US-Mexican border dictates some degree of local control, since it is we who are living our lives within the framework of NAFTA," says Eliot Shapleigh, a state senator from El Paso.

These days, Senator Shapleigh says he finds himself working more closely with officials in the Mexican state of Chihuahua than with officials from Arkansas. And new laws are encouraging more cross- border cooperation.

One bill allows state money to pay for environmental projects on either side of the border. To improve air quality, for instance, Texas money can now be used to buy a polluting Mexican brick kiln and put it out of business. …