01 Jan Divesting Federal Foreign Affairs Power? The Sudan Accountability & Divestment Act
It’s a happy new year (of sorts) for U.S. Human Rights Groups concerned about the ongoing humanitarian crisis in Darfur. For the last several years, groups such as the Save Darfur Coalition have pushed state and local governments to divest from companies that invest or do business with Sudan. Their efforts have produced some impressive results –since 2005, 22 U.S. states have divested their assets from Sudan, either along the lines recommended by the grassroots Sudan Divestment Task Force, or through some other model (the movement also has a private sector component, most visible through the 50-plus universities that have agreed to divest, and a transnational aspect, promoting similar divestment campaigns in countries such as Australia, Canada, Italy, Germany and the U.K.). Since its inception, however, the U.S. effort has operated under a constitutional cloud generated by the Supreme Court’s 2000 decision in the Crosby case. In Crosby v. National Foreign Trade Council, the Court held, without dissent, that a Massachusetts law banning state entities from buying goods or services from companies that did business with Burma was unconstitutional under the Supremacy Clause since it was preempted by the federal government’s foreign affairs power. Thus, Darfur activists had to worry about whether their divestment models differed enough from the Burma case, or if they would ultimately be struck down under a similar preemption analysis.
As of 2008, however, concerns about the divestment movements’ constitutionality appear greatly diminished. On New Year’s Eve, President Bush signed into law the Sudan Accountability and Divestment Act (SADA). Section 3 of the Act (available on Thomas as S.2271) contains the key provisions:
(b) Authority to Divest. Notwithstanding any other provision of law, a State or local government may adopt and enforce measures that meet the requirements of subsection (e) to divest the assets of the State or local government from, or prohibit investment of the assets of the State or local government in, persons that the State or local government
determines, using credible information available to the public, are conducting or have direct investments in business operations described in subsection (d).(c) Notice to Department of Justice. Not later than 30 days after adopting a measure pursuant to subsection (b), a State or local government shall submit written notice to the Attorney General describing the measure.
(d) Business Operations Described.
(1) In general. Business operations described in this subsection are business operations in Sudan that include power production activities, mineral extraction activities, oil-related activities, or the production of military equipment.(2) Exceptions. Business operations described in this subsection do not include business operations that the person conducting the business operations can demonstrate–
(A) are conducted under contract directly and exclusively with the regional government of southern Sudan;
(B) are conducted under a license from the Office of Foreign Assets Control, or are expressly exempted under Federal law from the requirement to be conducted under such a license;
(C) consist of providing goods or services to marginalized populations of Sudan;
(D) consist of providing goods or services to an internationally recognized peacekeeping force or humanitarian organization;
(E) consist of providing goods or services that are used only to promote health or education; or
(F) have been voluntarily suspended.(e) Requirements. Any measure taken by a State or local government under subsection (b) shall meet the following requirements:
(1) Notice. The State or local government shall provide written notice and an opportunity to comment in writing to each person to whom a measure is to be applied;
(2) Timing. The measure shall apply to a person not earlier than the date that is 90 days after the date on which written notice is provided to the person under paragraph (1).
(3) Applicability. The measure shall not apply to a person that demonstrates to the State or local government that the person does not conduct or have direct investments in business operations described in subsection (d).
(SADA also restricts federal government contracting with companies doing business in Sudan through a new certification by contractors that they do not engage in any prohibited business with Sudan as defined under section 3(c) above.)
I was a bit surprised that the Bush Administration, which is not known for bowing to popular pressures when it comes to executive power, would go along with a bill that effectively empowers states and local governments to impact U.S. foreign relations. Indeed, if a campaign like this can work for Darfur, why not climate change? But, President Bush did not sign the bill without comment. Indeed, his signing statement, while acknowledging the problem of Darfur, suggests a view of executive foreign affairs power that will continue to override anything to the contrary, even in this Act of Congress:
I share the deep concern of the Congress over the continued violence in Darfur perpetrated by the Government of Sudan and rebel groups. My Administration will continue its efforts to bring about significant improvements in the conditions in Sudan through sanctions against the Government of Sudan and high level diplomatic engagement and by supporting the deployment of peacekeepers in Darfur.
This Act purports to authorize State and local governments to divest from companies doing business in named sectors in Sudan and thus risks being interpreted as insulating from Federal oversight State and local divestment actions that could interfere with implementation of national foreign policy. However, as the Constitution vests the exclusive authority to conduct foreign relations with the Federal Government, the executive branch shall construe and enforce this legislation in a manner that does not conflict with that authority.
Certainly these types of signing statements are nothing new for the Bush Administration. Here, it suggests an Administration that wants to have it both ways—get the political credit for doing something “new” on Sudan where other policies have been less than fully effective, while also preserving a plenary view of executive power as much as possible. Of course, none of this gets at the really important question, which is whether any of these activities—whether sanctions or divestment—will make a difference on the ground in Darfur. Let’s hope they do.
Credit where credit is due: I think SADA is directly attributable to pressure by the Christian right to push for productive change in Darfur. For example, I was flipping channels one evening last year and saw Darfur featured in an episode of 7th Heaven–the writers went into a rather detailed exposition of what is happening in Darfur, why people should care about it, and what they could do to help. This would explain Bush’s uncharacteristic willingness to cede some executive authority on this matter.
But, as you insinuate at the end of the post, ultimately this is unlikely to have much impact absent major structural changes in international politics: a more representative Security Council and UN forces with real capabilities backed by governments actually invested in the missions, for starters. These are not changes that will happen overnight.
As was previously said, credit should be given as it is due, however the statement allowing him to override any actions taken in the name of this law not only gives him the power to override these actions without a chance for congress to strike back, but it also denies the Attorney General’s Office and the Supreme Court from doing anything about it.
As to the previous comment, a more representative Security Council would be meaningless unless the veto powers were taken away, which would spark protest from those nations, and potentially lose their backing, something the UN cannot afford in order to increase it’s legitimacy
Duncan, Thanks for calling attention to SADA and President Bush’s signing statement. Leaving aside the larger debate about signing statements, the signing statement here seems particularly off-base. President Bush said, as you note, “This Act purports to authorize State and local governments to divest from companies doing business in named sectors in Sudan.… However, as the Constitution vests the exclusive authority to conduct foreign relations with the Federal Government, the executive branch shall construe and enforce this legislation in a manner that does not conflict with that authority.” But the Constitution expressly vests in Congress the power to “regulate commerce with foreign nations, and among the several states.” Investing in (or divesting from) a company seems to squarely constitute “commerce.” And Congress has chosen to regulate commerce by specifying the circumstances in which States may make certain decisions about investment and divestment. So – modifying Justice Jackson’s dictum in Youngstown – as long as they act within the scope of SADA’s authority, it is the States that possess here both whatever power they possess themselves under the Constitution plus “all that Congress can delegate.” President Bush could reasonably have issued a signing statement to the effect that “State actions authorized… Read more »