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

Politics by Ben Geman

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."

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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[a]phx.com.