An affront to states' rights

Published: Monday, March 28, 2005 8:58 p.m. MST
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In many ways, Utah should have seen this coming. More than five years ago, the World Trade Organization interfered with a state law in Massachusetts that discouraged any company with a state contract from doing business with Myanmar. Lawmakers in Massachusetts didn't like the way Myanmar's government trampled on human rights.

After the European Union complained, the WTO ruled that the law contradicted U.S. obligations under the General Agreement of Tariffs and Trade. States' rights didn't matter.

Now the WTO is on the verge of deciding, in effect, whether Utah's prohibition on Internet gambling is a similar violation. The tiny nation of Antigua has brought the case against the United States. Thanks to an earlier WTO agreement, Antigua's banana and sugar industries were wiped out, and its economy now survives primarily on Internet gambling.

If the United States loses this one, Utah's law against Internet gambling could become void. Some say the inevitable, and eventual, outcome would be real-live casinos in the Beehive state, one of only two states that outlaw all forms of gambling.

The culprit here is not necessarily the WTO. It is the U.S. negotiation team that hammered out international trade agreements years ago without any thought for states' rights. Antigua and other nations with disputes against the trade practices of individual states are able to file grievances against the entire United States. That is a gross violation of the unique nature of this country, where each state operates as more or less autonomous under the umbrella of the U.S. Constitution.

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Americans take states' rights seriously. While the concept has eroded steadily since the time of the Civil War, states still see themselves as the preservers of their own unique regional cultures and standards. Utah's liquor laws, for instance, always have struggled to reflect a majority view on the ideal availability and advertising of strong drinks. And, despite anecdotal evidence that many Utahns travel to nearby states to gamble, lawmakers here have always felt it in the state's interests to strictly forbid the practice in Utah, and a majority of voters have agreed.

Regardless of how one feels about gambling, a state's right to pass its own laws regulating such things, without interference from Washington or — worst of all — some foreign nation, should be obvious.

The WTO is an important organization. It has nudged countries such as China and Russia toward democratic reforms in order to enjoy the benefits of membership. It struggles to resolve international disputes and to present a level playing field for international trade.

But for the WTO to prohibit a state from enacting laws on what it considers basic questions of right and wrong is simply unacceptable. If that happens, the Bush administration should tear up the general trade agreement and renegotiate it with states' rights in mind.

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