Volume 47, Number 1, Winter 2006 Localism in the New Global Legal Order Yishai Blank* Introduction Local governments are increasingly becoming major actors in the emerging global legal order. The United Nations, the World Bank, the European Union (“EU”), and other international and transnational1 institutions are beginning to view local governments as vehicles for the advancement of policies on a global scale. Local governments are transforming into objects for international regulation and are increasingly used as a means for disseminating and implementing global political programs, ªnancial schemes, and governance strategies. The traditional legal focus on state actors is shifting on to local governments, giving them independent legal status in the new global order. Local governments are obtaining international duties, powers, and rights; enforcing international standards; forming global networks involved in the creation of international standards; and becoming objects of international regulation. It has indeed become impossible to understand globalization and its legal ordering without considering the role of localities: They have become prime vehicles for the dissemination of global capital, goods, work force, and images.2 The evolving global status of local governments manifests itself in international legal documents and institutions, transnational arrangements, and * Buchmann Faculty of Law, Tel-Aviv University; S.J.D., Harvard Law School, 2002; LL.M., Harvard Law School, 1999; LL.B., B.A. (Phil.), Tel-Aviv University, 1997. I thank David Barron, Eyal Benvenisti, Hanoch Dagan, Jerry Frug, Sharon Hannes, David Kennedy, Roy Kreitner, Shai Lavi, John McGinnis, Ariel Porat, and Dori Spivak for their helpful comments and suggestions. I beneªted immensely from Jerry Frug’s and David Barron’s work on similar issues. Nimrod Karin provided excellent research assistance. I wish to thank the participants of the Tel-Aviv Faculty of Law faculty seminar, the American Bar Foundation seminar and the Tel-Aviv-Northwestern Law School Faculty Exchange Workshop for helpful suggestions. 1. This Article shall use the term “international” broadly to encompass both the international and the transnational. The two terms are logically distinguishable: “International” refers generally to all matters involving more than one nation, while “transnational” refers more speciªcally to actions or institutions which cross national borders but are often performed by segments within the state rather than by the state as a uniªed entity and, in addition, they do not necessarily adhere to the formal requirements of international law. The term “international” is thus broad enough that its deªnition can often include “transnational,” and the former is therefore used alone in this Article when both terms might apply. 2. This is particularly the case for large cities which, in the era of globalization, are often called “global cities” or “world cities.” See, e.g., Saskia Sassen, The Global City: New York, London, Tokyo (1991); Peter Hall, The World Cities (1984); World Cities in a World-System (Paul L. Knox & Peter J. Taylor eds., 1995); World Cities Beyond the West: Globalization, Development and Inequality (Josef Gugler ed., 2004). 264 Harvard International Law Journal / Vol. 47 legal regimes within many countries. To date, however, there has been almost no academic account of this signiªcant legal transformation.3 International legal theory has remained captive to the centralist and unitary conception of local governments, according to which they are mere subdivisions of states and thus undeserving of any theoretical analysis. And while international legal theorists have analyzed the extension of international law over nonstate entities such as private persons, non-governmental organizations (“NGOs”), and transnational corporations, those same theorists have ignored the profound transformation of localities into independent actors in the international arena. Likewise, local-government scholars have ignored the impeding global pressures on localities, treating the interaction of localities with global and international norms and institutions only sporadically. In contemporary international legal practice and policy making, however, localities are already being recast as independent semi-private entities, no longer mere state agents subsumed by their national governments. United Nations agencies, the World Bank, and various transnational institutions emphasize both the need to delegate and devolve power to local entities and the potential of localities to act like private corporations or other components of civil society. As such, localities’ ability to generate wealth and economic growth, their need to be ªnancially viable and self-reliant, and their capacity to promote good governance are given prominence over other traits of local governments. With this reshaping of localities comes a new set of ideas about the desirable relationship between state and local governments, including the ideal level of local autonomy, the ideal division of power between national and local levels, and the amount of ºexibility that should exist to adjust that division of power. Many of the legal changes accompanying the new global vision of local entities are only beginning to appear. The activities of a special U.N. agency aimed at formulating a World Charter on local self-government have not yet given rise to a binding international legal document. Regional treatises and transnational agreements such as the North American Free Trade Agreement (“NAFTA”) and membership in the General Agreement on Tariffs and Trade (“GATT,” now the World Trade Organization (“WTO”)) have only started to affect localities and local-government laws, while states’ and local governments’ compliance with emerging international standards is slow and far from complete. Nonetheless, it is possible to predict the results of this transition as well as to analyze its justiªcations and normative ramiªcations. This Article attempts to formulate preliminary lines of investigation into consequences of an emerging global regime that expands the role of localities, while also analyzing the normative underpinnings of the role localities could have in a world governed by a multitude of jurisdictions, some territo3. The work of Jerry Frug and David Barron is a rare and recent exception. See Gerald E. Frug & David J. Barron, International Local Government Law, in The Urban Lawyer (forthcoming 2006); see also Yishai Blank, The City and the World (unpublished manuscript, on ªle with the author, 2005). 2006 / Localism in the New Global Legal Order 265 rial, others less so. Part I traces recent changes that demonstrate the new role of localities in international law. Part II analyzes the normative justiªcations often used to legitimate the transformation of localities into prominent global actors: economic efªciency, democratic potential, and localities’ unique role as normative mediators between communities and states. Finally, Part III sets forth a normative and theoretical analysis of the role localities could and should have in the emerging global legal order. I. The Changing Role of Localities in International Law The Westphalian paradigm of international law is slowly waning.4 States are no longer the sole bearers of rights and duties in the international sphere, nor are they the sole actors in the international arena.5 The more international law extends its reach over nonstate actors, the more they become involved in international relations, transnational dialogue, and conºict. Domestic interest groups, transnational corporations, and global networks of NGOs all take part in the new global, political, and social constellation that deªnes the age of globalization. Alongside the arrival of new actors on the international stage, a multitude of transnational agreements, institutions, and adjudicative tribunals has emerged, reºecting the corresponding move from international to transnational law. Nonstate actors are not the only ones involved in transnational conºict and international norm generation. Homogeneous states still constitute yet another set of actors in a world where private corporations, individuals, and other nonstate actors create, execute, enforce, and interpret the law that affects international relations. Elements that ostensibly belong to the state— judiciaries, parliaments, and governmental agencies—form global networks that replace our old conception of the monolithic central state with a notion of a disaggregated state6 whose internal conºicts and discrete components become active and semi-independent elements in the global arena. The evolution of the new global order therefore means that the advancement of global policies is achieved through an elaborate web of institutions and agencies, both private and public. And while some of these institutions such as the United Nations, the International Monetary Fund (“IMF”), and the WTO are fairly novel, others long predate the age of globalization. Localities are among the oldest such entities and are currently being injected with 4. The Westphalian paradigm, a term offered by various writers in reference to the famous “peace of Westphalia” accord of 1648 (which ended the Thirty Years’ War), denotes the international legal order shaped by the conºicts and interrelationships of sovereign nation-states, conceived as the sole bearers of international rights and duties. See Kanishka Jarasuriya, Globalization, Law, and the Transformation of Sovereignty: The Emergence of Global Regulatory Governance, 6 Ind. J. Global Leg. Stud. 425, 425 (1999). 5. See Eyal Benvenisti, Exit and Voice in the Age of Globalization, 98 Mich. L. Rev. 167, 169–75 (1999) [hereinafter Benvenisti, Exit and Voice]; Eyal Benvenisti, Sharing Transboundary Resources: International Law and Optimal Resource Use 43 (2002) [hereinafter Benvenisti, Sharing Transboundary Resources]. 6. See generally Anne-Marie Slaughter, The Real New World Order, Foreign Aff., Sept./Oct. 1997, 183. 266 Harvard International Law Journal / Vol. 47 new legal meaning in order to fulªll their new function in the emerging global order. Numerous activities are helping to deªne localities’ new place in the global order. The following discussion divides them into four modalities. First, localities become bearers of international rights, duties, and powers. Second, localities become important objects of international and transnational regulation. Third, localities increasingly enforce international norms and standards. Fourth, localities form global networks. A. Localities as Bearers of International Rights, Duties, and Powers Though still short of obtaining the status of full international legal entities, localities have recently acquired both international duties and authority. As state agents, localities must comply with duties states have assumed as signatories to international charters and covenants.7 In other cases, localities have been given domestic authority based either on international obligations their states have assumed or on customary international law.8 Though there is hardly anything new about localities complying with their states’ international responsibilities, the legal context in which localities operate has changed signiªcantly over the past few decades. First, the exploding number of international agreements and the rapid evolution of customary international law mean that localities now exist in a legal surrounding far more complex than before. Where once only domestic law determined localities’ rights, duties, and powers, international rules now also apply. Second, many legal systems are decentralizing, particularly in economic terms.9 States increasingly delegate duties and authority to their localities, viewing them as self-funding autonomous units that can and should tax and spend at will. Yet because local subdivisions are still state agents, they are not absolved from their states’ international duties. The localities thus ªnd themselves in the awkward position of not being able to discern their obligations even as they are required to fund and fulªll them. 7. It is still impossible to sue localities in the International Court of Justice (“ICJ”) for such violations since only states have standing in the ICJ. However, the ability of individuals or other private parties domestically to sue localities that fail to comply with international obligations of their states is a matter of domestic law. For instance, localities might be compelled to provide various services to residents as a result of their states’ obligations under international instruments such as the Convention on the Rights of the Child or the International Covenant on Economic, Social and Cultural Rights (“ICESCR”). 8. Such was the recent City of Hudson case heard by the Supreme Court of Canada, where the Court inferred an authorization of the municipality to act on matters of environmental protection based on the evolution of international environmental law. See Canada Ltee v. Hudson (Ville) [2001] 2 S.C.R. 241. 9. The World Bank, Cities in Transition: World Bank Urban and Local Government Strategy 1, 34 (2000) [hereinafter Cities in Transition], available at http://www.worldbank.org/html/fpd/ urban/publicat/cities_in_transition_full.pdf (last visited Nov. 20, 2005). 2006 / Localism in the New Global Legal Order 267 B. Localities as Important Objects of International Regulation Various international bodies are currently engaged in attempts to regulate localities and their legal relations with their states. Treating localities as objects of international regulation means that physical planning, urban growth and poverty, and suburbanization and sprawl become the business of international institutions.10 In addition, the United Nations Center for Human Settlements (“UNCHS” or “U.N.-Habitat”),11 the World Bank12 and other transnational entities such as the EU.13 have been promoting an agenda of “decentralization” and “subsidiarity,” whereby decisionmaking powers and the provision of public services are to be devolved to the smallest jurisdictions that can efªciently perform them.14 The draft of the World Charter of Local Self-Government goes as far as recognizing a right of local self-rule that, for the ªrst time in modern international law, pierces the veil of sovereign nation-states and requires them to adopt measures that would recognize the unique role of localities and their rights as basic political units.15 Far beyond regulating or limiting the discretion of localities in areas such as planning, taxing, waste management, and environmental protection, these attempts aim to impose a speciªc view of the correct division of powers between central state and local jurisdictions, a view in which localities often have primary responsibility in many areas. This is not without reason; localities may be more efªcient, accountable, and effective at inducing democratic participation. However, I argue this might not always be true. Furthermore, some global decentralization schemes impose certain methods of legal organization, calling for a “clear and transparent” division of powers rather than one decided on a case-by-case basis through an ongoing dialogue between courts and legislatures.16 10. Over the past few decades, the United Nations and the World Bank advanced programs that address such issues in urban and rural areas throughout the world. See, e.g., Philip Kivell, Land and the City: Patterns and Processes of Urban Change 60–62 (1993). 11. UNCHS—later renamed U.N.-Habitat—was established in 1976 under the Vancouver Declaration on Human Settlements. The General Assembly afªrmed the importance of human settlements for the development agenda of the United Nations and agreed that institutional arrangements such as the establishment of dedicated agencies are necessary to promote this agenda. See Institutional Arrangements for International Co-operation in the Field of Human Settlements, G.A. Res. 31/116, at 62, U.N. Doc. A/RES/31/116 (Dec. 16, 1976). 12. Cities in Transition, supra note 9, at 34. 13. The EU has been among the ªrst transnational institutions clearly to advance the principle of subsidiarity. The Draft Constitution of the EU extends the principle of subsidiarity not only to the relations between the member states and the Union but also to the local and regional levels. The Draft Constitution clearly states in Title III, Article 9 that the EU cannot make decisions if they can be made at least as effectively at the national or at the local or regional level. See Draft Treaty establishing a Constitution for Europe, July 18, 2003, 2003 O.J. (C 169) 10. 14. For present purposes, I make no distinction between decentralization and subsidiarity despite important differences between these two key concepts in contemporary governance projects. 15. U.N. Center for Human Settlements (Habitat) and World Association of Cities and Local Authorities Coordination (“WACLAC”), Towards a World Charter of Local Self-Government: The Origins, Aims and Proposed Preparation Process for the World Charter (1998), available at http://www.gdrc.org/ugov/charter.html (last visited Nov. 17, 2005). 16. For a thorough description of this kind of transnational imposition of rigid legal frameworks, see 268 Harvard International Law Journal / Vol. 47 C. Localities Increasingly Enforce International Norms and Standards Local initiatives to enforce international standards have recently become widespread. Throughout the world, localities have adopted international labor standards or otherwise enforced international human rights norms by imposing economic sanctions on states that have violated such rights or on corporations that have done business with those states.17 The growing involvement of localities in foreign affairs and international norm enforcement signiªes that localities, from big cities to small towns, are entangled with the emerging global village. This voluntary enforcement demonstrates that globalization is not only imposed on passive localities by their states or by international institutions—it is also advanced from the ground up by localities themselves. Localities are thus doing their own part to further disaggregate the waning Westphalian concepts of the unitary state.18 D. Localities Form Global Networks and Become Involved in International Norm Generation The networks of institutions, civil society, and ad hoc activities that comprise localities have blossomed on a global scale in recent years.19 The meaning of the burgeoning global association of localities is twofold. It both denotes local divisions’ growing self-awareness of their own importance, and implies a current deªcit in localities’ effective participation in global governance projects—a deªcit that induces localities to cooperate, rather than simply to compete, in order to obtain a greater degree of inºuence. The United Nations20 and the EU.21 have also encouraged this process. generally Frug & Barron, supra note 3. 17. For detailed discussions of such measures taken at the level of states and localities, see Sarah H. Cleveland, Norm Internalization and U.S. Economic Sanctions, 26 Yale J. Int’l L. 1 (2001); Peter L. Fitzgerald, Massachusetts, Burma and the World Trade Organization: A Commentary on Blacklisting, Federalism and Internet Advocacy in the Global Trading Era, 34 Cornell Int’l L.J. 1 (2001); Robert J. Delahunty, Federalism Beyond the Water’s Edge: State Procurement Sanctions and Foreign Affairs, 37 Stan. J. Int’l L. 1 (2001); Peter L. Fitzgerald, Pierre Goes Online: Blacklisting and Secondary Boycotts in U.S. Trade Policy, 31 Vand. J. Transnat’l L. 1 (1998). 18. Cf. Sarah H. Cleveland, Symposium: Crosby and the “One-Voice” Myth in U.S. Foreign Relations, 46 Vill. L. Rev. 975 at 991–98, 1001–06 (2001) (arguing that the United States has never held a monopoly over foreign relations and that states and localities have always been involved in such affairs). 19. Examples include: The World Organization of United Cities and Local Governments; World Association of Cities and Local Authorities Coordination; International Union of Local Authorities; Mayors’ organizations; the World Federation of United Cities; the World Urban Forum; the International Council for Local Environmental Initiatives, and several more. See David Smith & Michael Timberlake, Hierarchies of Dominance Among World Cities: A Network Approach, in Global Networks, Linked Cities 117, 117– 19 (Saskia Sassen ed., 2002). 20. The U.N. Advisory Committee on Local Authorities and the World Organization of United Cities and Local Governments are examples of such supposedly representative bodies currently being constructed in order to foster inter-city and city-state cooperation over various issues and take part in forming U.N. and World Bank local government policies. See generally Cities in Transition, supra note 9. See also U.N. Advisory Committee on Local Authorities, available at http://www.cities-localgovernments.org/uclg/ index.asp?pag=template.asp&L=EN&ID=19 (last visited Nov. 20, 2005). 21. A clear signal of the growing power given to representative bodies of localities is the suggestion to 2006 / Localism in the New Global Legal Order 269 The emerging picture is that of a legal world order in which localities are increasingly becoming important actors, as nation-states are losing their monopoly over matters that many once considered part of nation-states’ exclusive sovereignty.22 This division of sovereignty however, should not be mistaken for the complete disappearance of the nation-state, for it remains quite alive. Nor should the change be understood to empower only formal international institutions at the expense of the mostly defeated nation-state. Unlike in the case of localities, much has been written about the growing importance of nonstate actors to international law and the expansion of laws governing nonstate actors, such as transnational corporations, global networks of private and public entities, domestic interest groups that strategically use international arenas to advance their goals,23 and individuals. Taken together, these four modalities demonstrate that globalization is embedded not only in national territories, laws, and administrations,24 but also in their local counterparts. In other words, globalization takes place in territorial units far smaller than the national territory of the state at large. These geographical units, commonly called local governments, are deªned not merely by economic or social factors but also by national and international laws and institutions. While the literature that deals with the role of cities in the global economy treats them as economic and spatial creatures, they are also legal creatures. II. Why Localities? Efªciency, Democracy, and Normative Mediation This Part contemplates a global legal order in which many jurisdictions— both national and local—are involved. In the abstract, localities are just one type of jurisdiction among many others: provinces, cantons, private corporations, families, and churches. The word “jurisdiction” here captures various legal entities vested with authority to govern individuals and property. Though jurisdictions are quite often territorial, some—like religious groups— can exist independent of physical location, and they all tend to vary in size, membership, wealth, and purpose. Indeed, what marks the new world order is precisely that various elements of domestic civil society—often given the status of a jurisdiction within the nation-state—are transposing themselves to the global sphere, interacting and contracting with other jurisdictions grant the Committee of the Regions locus standi in the European Court of Justice if the Committee thinks that the principle of subsidiarity has been breached. See Protocol on the Application of the Principles of Subsidiarity and Proportionality, Dec. 16, 2004, 2004 O.J. (C 310) 208. 22. A growing body of literature has argued convincingly that the much-celebrated homogeneous and solidiªed sovereignty never really existed, and that both domestic and international entities always shared power with states. See, e.g., Stephen D. Krasner, Sovereignty: Organized Hypocrisy (1999). 23. See generally Benvenisti, Exit and Voice, supra note 5. 24. See Saskia Sassen, The State and Globalization: Denationalized Participation, 25 Mich. J. Int’l L. 1141, 1141 (2004). 270 Harvard International Law Journal / Vol. 47 from all over the world, forming global networks, and becoming involved in transnational and international institutions. Localities function in a similar way. Proponents of local empowerment justify their position through the virtues of localism: economic efªciency and development, more direct and accountable democracy, and normative mediation between communities and governments. It is indeed a fascinating convergence of distinct ideological commitments that gives rise to contemporary support for decentralization (understood as delegating powers to smaller units of government) in general and for vesting powers in local governments in particular. But is this a desirable development? And if localities are legal entities in the global sphere, how may they be constructed to fulªll their normative function? This Part analyzes the virtues of localism as well as the difªculties localism causes when it is uprooted from its usual setting—the nation-state— and transported to a global setting. A paradox ultimately emerges: Legal decentralization and increased local involvement in the global legal order promise to enhance efªciency and democracy but also threaten these same values. This Article argues that the promise might be realized, but only if the threat is ªrst recognized and managed. A. Efªciency Many theories advocating delegation of authority from central to local governments have emphasized economic advantages accompanying the shift. According to the Tieboutian model, viewing localities as commodities organized in a market explains the desirability of a political and legal system that gives local governments signiªcant discretion over local taxation and the provision of public services.25 The model hypothesizes that citizens choose where to live according to their individual preferences, and that localities respond to these demands by competing among themselves, thus creating a variety of service-packages available to consumers. The Tieboutian model presumes that this inter-local competition not only induces localities to improve public services that they provide, but also encourages economic growth. The need to encourage such jurisdictional competition has dominated much of economic theory’s interest in localities.26 25. See generally Charles Tiebout, A Pure Theory of Local Expenditures, 64 J. Pol. Econ. 416 (1956). According to a simpliªcation of Tiebout’s more complicated model, efªcient handling of public goods requires that localities compete with each other in attracting individuals to become their residents by offering those freely moving citizens “packages” of services, such as policing, schools, and sanitation. Different localities would offer varying packages, with varying price tags attached to them, and citizens would be free to choose which package they wish to consume by voting with their feet. The underlying Tieboutian assumptions—free movement, full knowledge of the nature and condition of the commodity, and the lack of externalities in the market—have faced attack by many scholars during the past forty years for both theoretical and realistic reasons. See Gerald E. Frug, City Services, 73 N.Y.U. L. Rev. 23 (1998). In addition, the notion of an efªcient local-government market in which citizens move according to their preferences is obviously an imperfect description of many jurisdictions across the world. 26. For a thorough overview of the dissemination of jurisdictional competition theories, see William 2006 / Localism in the New Global Legal Order 271 Contemporary proponents of the principle of subsidiarity similarly rely on the advantages of jurisdictional competition and, more generally, on the economic efªciency of the devolution of powers to localities. The theory of subsidiarity holds that central governments should occupy only a subsidiary function, performing only those tasks that cannot be performed at a more immediate or local level.27 Subsidiarity has come to dominate international human rights law,28 EU law,29 and conservative jurisprudence in the United States.30 Though its roots lie in Catholic thought,31 and its exact content varies across different legal systems, subsidiarity is currently understood to exemplify libertarian ideals that marry individual freedom with economic efªciency by promoting liberty, experimentation, and healthy competition.32 In response to problems that stymie central governments, such as vulnerability to capture by rent-seeking interest groups,33 the concept of jurisdictional competition has become so attractive that it has effectively created a default rule in favor of delegation of powers to localities.34 Notwithstanding its unquestionable advantages, delegation of powers to lower levels of government creates an array of collective action problems that cause the opposite of the desired outcome: deterioration of public goods and inefªciency. In the case of public goods such as the environment and other natural resources, and of public services such as education and security where cooperation and peer-participation are crucial,35 jurisdictional competition has led to a socalled “race to the bottom” as well as to other collective action failures enabled by uneven exit options36 and by a growing ability of some to externalW. Bratton & Joseph A. McCahery, The New Economics of Jurisdictional Competition: Devolutionary Federalism in a Second-Best World, 86 Geo. L.J. 201 (1997). 27. See George A. Bermann, Taking Subsidiarity Seriously: Federalism in the European Community and the United States, 94 Colum. L. Rev. 332, 336 (1994); Andrew Koppelman, How “Decentralization” Rationalizes Oligarchy: John McGinnis and the Rehnquist Court, 20 Const. Comment 11, 12 (2003). 28. See Paolo G. Carozza, Subsidiarity as a Structural Principle of International Human Rights Law, 97 Am. J. Int’l L. 38, 39 (2003). 29. See Denis J. Edwards, Fearing Federalism’s Failure: Subsidiarity in the EU, 44 Am. J. Comp. L. 537 (1996). 30. See Robert K. Vischer, Subsidiarity as a Principle of Government: Beyond Devolution, 35 Ind. L. Rev. 103, 103–04 (2001). 31. See id. at 108–15; Carozza, supra note 28, at 40–42. 32. See John O. McGinnis, Reviving Tocqueville’s America: The Rehnquist Court’s Jurisprudence of Social Discovery, 90 Cal. L. Rev. 485, 510 (2002). 33. Suspicion of the beneªts conferred by central governments due to the activity of rent-seeking interest groups and politicians who are captured by those groups has been the hallmark of public choice theory for the past ªfty years. See, e.g., Kenneth J. Arrow, Social Choice and Individual Values 46–60 (1951); George J. Stigler, The Theory of Economic Regulation, 2 Bell J. Econ. & Mgmt. Sci. 3, 10– 17 (1971). 34. See Bratton & McCahery, supra note 26, at 203–04. 35. Fennell has demonstrated this point in the context of education and local policing. See Lee Anne Fennell, Beyond Exit and Voice: User Participation in the Production of Local Public Goods, 80 Tex. L. Rev. 1 (2001) [hereinafter Fennel, Beyond Exit and Voice]; see generally Lee Anne Fennell, Homes Rule, 112 Yale L.J. 617 (2002) (book review). 36. For example, more mobile and afºuent people and groups can move out to the next jurisdiction in order to avoid subsidizing the poor or to escape what they experience as unwanted impositions (e.g., integrated schools) by their fellow residents. Moving to another locality might be helpful to such groups 272 Harvard International Law Journal / Vol. 47 ize costs. Well-organized interest groups exert disproportionate power within their states and obtain an equally disproportionate percentage of political and tangible goods, such as lower tax rates, more subsidies, and more favorable legislation.37 Well-organized or well-ªnanced local governments can also obtain disproportionate inºuence using similar means. In both cases, suboptimal resource allocation is the unfortunate, albeit logical, result. In national governments, various legal mechanisms have been proposed to mitigate some of these failures by fostering cooperation among competing jurisdictions or requiring coordination by central agencies.38 Such solutions are context- and issue-speciªc39 and reºect the ability of domestic legal systems to counteract market forces and to prevent interest groups from exerting a disproportionate inºuence. Globalization might exacerbate disproportionate local inºuence, and many solutions available in the domestic arena are irrelevant or impossible to implement on the international level. The inability to muster a uniªed global political will to force jurisdictional cooperation where necessary, for example, is emblematic of globalization. Localities entrusted with more power and burdened with greater international obligations now ªnd themselves competing with one another in the global sphere, encountering the same problems that once perverted local competition in the domestic sphere. The increasingly global arena presents two principal difªculties that make worldwide cooperation among localities much more difªcult than in the Westphalian universe of sovereign nation-states. First, technological innovation has made ºight of capital and production to avoid tax liability much easier, thereby intensifying, not relaxing, jurisdictional competition. Investors and manufacturers can shift their facilities away from localities that become too expensive, driving taxation rates and domestic regulation standards downward.40 Corporations may be able to obtain immunity from national courts and avoid regulation and liability, thus externalizing costs to third parties.41 Given the current nature of immigration laws, the exit option is asymmetrical: Most residents are unable to exit their locality in the same sense that investors and producers can effectively take ºight, and even if the residents if the poor (or other “unwanted” groups) cannot follow them due to those groups’ diminished mobility (caused by some of the following reasons: close family ties, limited resources and reduced work security, or zoning laws that make it harder for them to move to afºuent jurisdictions). 37. Such disproportionate power is made possible in large part by small groups’ better organizational abilities. Mancur Olson, The Logic of Collective Action 22–36 (1965). 38. Such regional mechanisms can be in the form of ad hoc administrative agencies that govern areas of activities across local jurisdictional boundaries, special purpose governments (SPGs) that manage regional resources or services (such as trafªc and planning), or even regional legislative bodies. See Richard Briffault, Our Localism (pts. 1&2), 90 Colum. L. Rev. 1 (1990), 90 Colum. L. Rev. 346 (1990). 39. See generally Fennel, Beyond Exit and Voice, supra note 35 (policing and education); Abraham Bell & Gideon Parchomovsky, The Integration Game, 100 Colum. L. Rev. 1965 (2000) (education and housing); Vicki Been, Locally Undesirable Land Uses in Minority Neighborhoods: Disproportionate Siting or Market Dynamics?, 103 Yale L.J. 1383 (1994) (the environment). 40. Benvenisti, Exit and Voice, supra note 5, at 169–70. 41. Id. 2006 / Localism in the New Global Legal Order 273 are able to move to a neighboring locality—a weak assumption unto itself42— they cannot move across national borders. In fact, despite the assumptions of Tieboutian economic models regarding the free movement of citizens between localities, in many cases, people are unable to move even within their state to another locality. Second, although localities are bound by their states’ international obligations, they have no formal voice in the creation or adjudication of international norms. Despite steps aimed at increasing localities’ participation in international institutions and strengthening localities’ voice in domestic procedures that affect localities’ status,43 there remains a serious deªcit in the universally equal representation of localities’ interests in international decisionmaking bodies. Where localities compete with each other to attract foreign capital in order to survive ªnancially, the above two problems foster ruthless competition that generates both inefªciencies and increased inequality among the competing localities. The ªerce competition to attract huge events such as the Olympic Games and the World Cup offers a particularly accessible example of the negative consequences of jurisdictional competition among localities on a global scale.44 Desperate to renew investments and project a positive image, localities attempt to beautify themselves, often displacing hundreds of thousands of residents in the process.45 Such activities not only cause misery to the more disadvantaged residents but also come at the expense of other localities: State subsidies are diverted to the winning localities46 and negative externalities are inºicted upon the losers. In the long run, global jurisdictional competition grows, and localities fall under pressure to offer investors more attractive tax beneªts, subsidies, and other “perks,” thereby reducing the resources available for other purposes. As Professor Benvenisti argues convincingly, in order to function effectively the solutions to many collective action problems cannot be general and deªnitive in nature; rather, they should lie in case-speciªc transnational institutions that “provide an environment for the evolution of conditional cooperation . . . and respond to the democracy and social justice challenge of this age of globalization.”47 Some institutions are already emerging, especially in the realm of natural resource management, where localities cooper42. Constraints on movement between localities are a result of ªnancial ability, zoning laws, family ties, and employment. See Gerald E. Frug, City Services, 73 N.Y.U. L. Rev. 23 (1998). 43. I refer mainly to U.N. and EU efforts to include representatives of localities in processes that have an impact on them. See supra notes 19–20. 44. See generally Solomon J. Greene, Staged Cities: Mega-Events, Slum Clearance, and Global Capital, 6 Yale Hum. Rts. & Dev. L.J. 161 (2003). 45. Id. at 161–69. 46. Indeed, such mega-events are often a way in which rich and powerful cities manage to obtain state subsidies, demonstrating what Benvenisti describes as the way in which domestic interest groups use the transnational arena to win over other domestic groups. See Benvenisti, Exit and Voice, supra note 5, at 171–75. 47. Id. at 203 (emphasis added). 274 Harvard International Law Journal / Vol. 47 ate, generate norms, enter voluntary agreements, and even establish tribunals.48 These legal mechanisms should be encouraged and enabled by preexisting international institutions and states, and, where localities fail to cooperate, organizations that can referee the conºicts should intervene. The following discussion examines how courts and tribunals foster dialogue between localities, states, and international institutions. B. Democracy The notion that empowering localities will promote democracy is often taken for granted. Local governments can indeed promote some crucial aspects of democracy: Enabling participation in the political process is often much easier and cheaper in local settings, and local politics creates the opportunity for people to participate in decisionmaking and breeds good democratic citizenship.49 Moreover, local politics is by nature closer to the interests of the residents, making voter apathy easier to overcome. Practically speaking, the relative homogeneity of a local population makes consensus easier to reach and allows people to deliberate controversial matters.50 And, perhaps most important, local self-rule enables people to collectively engage political matters in order to become masters of their own fate as a community.51 As one U.S. commentator astutely remarked, however, though “‘decentralization’ sounds wonderfully democratic . . . it can be deployed in order to disguise oligarchic rule by unaccountable elites.”52 Indeed, there is nothing inherently democratic about local governments. They can be appointed by state organs rather than elected by residents, and they can be used by stringpulling state organs to manipulate policy even if the local governments’ initial appointment was free of impropriety. For popular participation and democracy to prosper, therefore, several conditions must be met: Local governments must include elected ofªcials rather than solely appointed bureaucrats; residents must participate in decisionmaking processes rather than simply vote once every few years;53 and local values and local knowledge must be able to inºuence the decisions of local governments. This logic ap48. See Benvenisti, Sharing Transboundary Resources, supra note 5, at 131–231. 49. See generally Roderick M. Hills, Jr., Corruption and Federalism: (When) Do Federal Criminal Prosecutions Improve Non-Federal Democracy?, 6 Theoretical Inquiries L. 113 (2005); Roderick M. Hills, Jr., Romancing the Town: Why We (Still) Need a Democratic Defense of City Power, 113 Harv. L. Rev. 2009 (2000). 50. Some of these claims, though empirical in their nature, have not been sufªciently proven. See Yishai Blank, The Resilience of Participation: A Comment on Prof. Hills, 6 Theoretical Inquiries L. 155 (2005). 51. Frug has developed this point, which he calls “public freedom” in the tradition of Hannah Arendt, extensively. See Gerald E. Frug, The City as a Legal Concept, 93 Harv. L. Rev. 1057 (1980). 52. Koppelman, supra note 27, at 11. 53. Recent research demonstrates the invaluable nature of ªrst-hand experience and participation of ordinary citizens in government. See Archon Fung, Empowered Participation: Reinventing Urban Democracy (2004), 53–89, 99–101. 2006 / Localism in the New Global Legal Order 275 plies equally at the global level: for residents to learn that their participation matters, localities need to be meaningfully represented in global decisionmaking. The current structure of international law and institutions, with their focus on the Westphalian state, does not allow such democratic representation of localities on the global stage. If democracy is to be taken seriously, possessing democratic internal structures is not enough; localities must become equal partners in the formation and adjudication of international norms. Transnational decisionmaking must be regulated or it will otherwise reºect raw power struggles and existing inequalities among localities, further disenfranchising unorganized and disadvantaged communities. Even non-democratic processes aimed at securing the equality of disadvantaged groups form fertile ground for capture of the international process by strong and well-organized interest groups, making transnational negotiations even more open to abuse by powerful domestic players. The arguments offered by the international legal process school to defend international institutions from claims that they are anti-democratic do not reject or even oppose a structural change that will strengthen localities’ representation in the process of international norm generation, interpretation, and adjudication.54 On the contrary, as Catherine Powell argues convincingly, enforcement of international human rights law by localities can and should be understood as the exercise of genuine popular values that infuse international law with legitimacy and democracy.55 Formal and substantive representation of localities’ voice in international entities should thus be seen as another necessary step in the direction of furthering global democracy. Especially disturbing are tendencies to view localities as means of governance rather than as democratic governments in which actual politics takes place.56 “Governance” assumes agreed-upon goals, known priorities, and an established political agenda. And while international agencies and institutions are formed around such rigid principles, vibrant and effective local democracy means that at least some localities necessarily will disagree with international bodies on these same points.57 Democracy, then, like efªciency, cannot be used as a blanket justiªcation for decentralization and empowerment of localities vis-à-vis the state. Merely granting authority, duties, and rights to local governments will not advance 54. See, e.g., Harold Hongju Koh, Transnational Legal Process, 75 Neb. L. Rev. 181 (1996); Harold Hongju Koh, Why Do Nations Obey International Law?, 106 Yale L.J. 2599 (1997). For one of the most recent examples of such a defense, see Anupam Chander, Globalization and Distrust, 114 Yale L.J. 1193 (2005). 55. See Catherine Powell, The Role of Transnational Norm Entrepreneurs in the U.S. “War on Terrorism,” 5 Theoretical Inquiries L. 47, 51–55, 71–80 (2004). 56. See Frug & Barron, supra note 3. 57. For example, as Anupam Chander acutely observes in response to McGinnis and Movesian’s argument that international free trade is substantively democratic since it opposes protectionist interest groups, democracy is also the freedom to choose other values over free trade. See Chander, supra note 54, at 128. 276 Harvard International Law Journal / Vol. 47 this important goal at all if supplementary measures are not taken. Democratically speaking, empowered local governments appointed by central state organs can hardly be seen as an improvement over direct central control. And a global regime that gives voice and “suffrage” (in the international and global organs) to some localities only can hardly be seen as promoting democracy at all. Using localities as vehicles to promote or even achieve democracy worldwide requires them, as an initial matter, to become democratic: to be run by elected ofªcials, to involve their residents in at least some policymaking, to be accountable and responsive to their residents’ wills, and to induce popular involvement in politics. In addition, promoting global democracy through cities requires equal voice—or at least better representation—for all localities that are affected by the various aspects of globalization. Full-ºedged local participation in the global order, however, is fraught with difªculty and uncertainty. Will all existing localities be equally represented in the international “legislature” or in transnational norm-generating institutions, regardless of localities’ respective size and wealth? Should localities be equal to states or should there be a hierarchy among various types of members of the international government? Should localities be represented in adjudicatory bodies in the same way states are represented today in international courts and tribunals? Part III addresses these questions squarely. C. Normative Mediation The role of localities as mediators between local communities and the central government signiªes a connection between the individual and the state, a connection often territorialized in a locality and institutionalized in local governments. Localities are often surrogates for many kinds of cultural communities, and local governments become the means by which these communities negotiate their values, preferences, and normative vision with the larger national polity. Local communities are not always deªned by religion or ethnicity, but occasionally by a unique local knowledge or culture tied to a speciªc location or history. This speciªc “know-how” is inculcated through the intimate shared living environments that localities are uniquely suited to provide, and cannot be easily duplicated by people who are not “local.”58 Because of its unique nature as agent for both the state and the local community, local government must mediate between different normative visions.59 Localities’ jurisdiction over the local budget, business licensing, education, 58. For detailed analysis of the struggle between central state planning and local knowledge, see James C. Scott, Seeing Like a State: How Certain Schemes to Improve the Human Condition Have Failed 11–83, 103–46 (1998). 59. This duality—one that can be found in different levels in all states throughout the world—is the reason this Article does not address city-states (or “micro-states” such as Singapore, Andorra, Monaco, Lichtenstein, etc.), where the duality has collapsed because the state is one and the same as the city, and there is no such normative mediation role between a local community and a national polity. For a discussion of city-states, see Jorri Duursma, Fragmentation and the International Relations of Micro-States: Self-Determination and Statehood (1996). 2006 / Localism in the New Global Legal Order 277 and other aspects of the public sphere enables localities to reºect local knowledge and culture while taking into account their role as state agents. This duality gives rise to constant struggles in courts, legislatures, and executive agencies over the amount of deference that should properly be accorded localities in performing their duties. At the not-so-distant extremes, the locality will become either a tool of domination for national elites over a subservient local community or a tool of domination for local elites over their population, especially unorganized minorities or disempowered majorities.60 Globalization challenges localities’ true allegiances by turning them into mediators not only between the national and the local, but also between the international and the local. Localities are thus faced not only with national concerns but also with international concerns, and must harmonize all such concerns with their own knowledge, culture, and interests. III. How Localities? What Localities Should Become in the Age of Globalization Localities are already assuming a greater role in the emerging global legal order and possess unique traits that make them good candidates to assume even more responsibility and signiªcance in international governance. In order for localities to fulªll their potential and overcome the unique problems caused by globalization, however, several legal reforms must be taken. There are three main legal attributes that localities are already developing: incorporation, legal standing in legislative, executive, and adjudicative bodies, and ability to conduct foreign relations. This Part discusses these changes. One of the most obvious changes is the broadening of the term “locality.” As a legal concept, the term is extremely vague due to the huge variance among localities throughout the world. “Locality” denotes both mega-cities with populations exceeding twenty million as well as small towns of a few families, technologically advanced Western cities as well as rural villages in developing countries, sprawling metropolitan areas as well as tiny, condensed settlements. Under the old national legal order, localities were geographical subdivisions of the national territory as deªned by national laws and institutions.61 Classic recognition of a locality required a license from the state to perform various activities, to provide services, and to obtain some degree of autonomy from state intervention.62 The plurality of localities was a matter for the state to decide, and it could decide to modify this plurality by pro60. The latter danger is what Madison feared when he defended a strong federal government against local factions that might oppress minorities. See Alexander Hamilton, James Madison, John Jay, The Federalist Papers, No. 10, 46–52 (New American Library, 1961). 61. See Richard T. Ford, Law’s Territory: A History of Jurisdiction, 97 Mich. L. Rev. 843, 844 (1999) (arguing that the very concept of “the local” has been invented and made possible only by the evolution of national systems throughout the world). 62. See Gerald E. Frug, The City as a Legal Concept, 93 Harv. L. Rev. 1057, 1062–80 (1980) (offering a comprehensive account of the history of the legal construction of cities and the various mechanisms by which places obtained charters of incorporations, powers, duties, and rights). 278 Harvard International Law Journal / Vol. 47 hibiting incorporations of excessively small localities, forcing annexations of adjacent localities, encouraging suburbanization, or promoting sprawl.63 Under the new global legal order, that area of national articulation is becoming a ªeld of global contestation in which international conºicts emerge. Of course, international laws and regulations do not yet revoke the ability of states to incorporate their own localities, instead taking the existing boundaries for granted and utilizing and transforming what lies within. But the degree of variation of localities within a state is becoming precisely the context in which those very localities assert global status, receive global regulation, and compete with one another on a global scale. If the internationalization of localities continues, the questions as to who will grant them the global “charter” to incorporate, and under what conditions, become crucial. The more international institutions develop vested interests in which communities may become localities, and the more these institutions see localities as allies in their global governance project, the more control these institutions will want over the charter process itself. Already, the World Bank obliquely suggests that not every existing locality will continue to exist as a legally separate, autonomous entity in the new globalized world: Only “bankable” localities that can support themselves ªnancially will.64 Simple deduction leads to the conclusion that some smaller localities will likely need to merge into larger metropolises to survive. Giving localities a major role in the international arena will eventually grant them international legal status and, consequently, radically transform the existing variance of local communities. Local governments do not only manage resources; they also deªne communities, allow various minorities a certain degree of autonomy, and enable a type of politics seldom found at the national and international levels. Given these diverse roles, the total collapse of the legal into the economic—the idea that only economically efªcient localities should be legally recognized—threatens to privilege economic efªciency over other values such as community, local knowledge, pluralism, and diversity. The task of any global charter must therefore be to acknowledge that, in the new global order, localities are uniquely situated, not only as promoters of economic efªciency, but also as protectors of various minorities and of local cultures. In realizing a global charter system, the most important questions are: Who will determine the criteria for granting a locality a global charter of incorporation that will give the locality a legal personality in the global sphere? With which powers will the charter endow localities? What will localities be allowed or mandated to do if they are to be trusted by international insti63. State recognition policies can be complicated and contradictory. For example, Israel can adopt a policy of allowing no new settlements with a population smaller than 10,000 and then build dozens of tiny settlements with only a few hundreds of families each if doing so suits its national interests— populating the Occupied Territories, the Galilee or the Negev desert. 64. The World Bank has emphasized more conditions such as livability, competitiveness, and quality of management. See Cities in Transition, supra note 9, at 48–56. 2006 / Localism in the New Global Legal Order 279 tutions? How will the line between international, national, and local authorizations be drawn? And who will adjudicate the conºicts regarding these questions once they arise? The principle of subsidiarity attempts to give a ªnal, if broad, answer to these questions. It holds that government powers should always reside at the lowest level possible, such that the national level should be involved only if the local is inappropriate, and the international only if the other two fail.65 The contexts in which services, decisions, and goods are handled by different levels of government, however, vary so dramatically that simply authorizing the locality cannot remain the default rule. At every turn, one must identify whether there are externalities or other collective action failures that require invocation of central authority, forced cooperation among localities, or supervision of another kind. In addition, the externalities themselves change as people’s preferences change and as technology improves. Scientiªc ªndings transform our understanding of connectedness or isolation; we now know that some activities have further-reaching consequences than many once imagined. Currently, national courts face similar dilemmas when they adjudicate disputes over line-drawing between local and central authorities’ control over zoning, education, environmental protection, and religion. National and local institutions together with courts are responding to such challenges by adopting laws and regulations that modify local power vis-à-vis the state and affect the meaning of localism in a speciªc time and place.66 No matter how comprehensive and detailed the list of authorities and powers localities possess, conºicts inevitably emerge when localities execute their powers in areas that gain national attention. The balance between the national and the local is in constant ºux, and the need to negotiate and decide related matters will not vanish. But the forum will change as these debates become increasingly international in scope. Ensuring the legal standing of localities in the various institutions that negotiate these matters is therefore imperative. Allowing localities—uniquely situated as they are—to voice their interests, knowledge, and internal plurality is required both by democratic concerns as well as by economic efªciency. Once forced to consider objections and information provided by localities, international institutions will be subsequently compelled to take into account opposing views of the public good, and institutional capture by small interest groups is likely to become more difªcult. 65. See Draft Treaty establishing a Constitution for Europe, supra note 13. 66. Such dynamics are at the heart of local government law and debates regarding localism. In the United States, “home rule” and preemption are linchpin doctrines for the legal management of conºicts over the degree of local autonomy. See David J. Barron, Reclaiming Home Rule, 116 Harv. L. Rev. 2255 (2003). For a description of similar dynamics under a somewhat different legal regime, see Yishai Blank, Local Frontiers: Local Government Law and Its Impact on Space and Society in Israel (2002) (unpublished S.J.D. dissertation, Harvard Law School). 280 Harvard International Law Journal / Vol. 47 Although an important starting point for inquiry, the idea of a charter given to localities by one coherent and uniªed global authority is practically impossible. International conºicts and the multitude of transnational agreements concerning localities demonstrate the limited extent of international law’s reach. Localities achieve international agreements despite lacking ofªcial competence to form international treaties.67 Global charters of incorporation are given to localities on a daily basis by regional entities, or states that contract with one another and allow inter-local coordination.68 These transnational agreements—deprived of central authorization and the concomitant title “treaties”—are the reason localities are becoming involved in foreign affairs.69 International law, however, should not be ruled out as a means to advance ideals and spur change. Even when international conºict and multinational producers and investors stand in the way, for example, turning localities into formal members of the United Nations has the potential to transform the global arena in a positive way, rendering it more reºective of the current international reality. Such radical measures necessitate further probing into the structure of the United Nations, the relationship between states and localities, the need to form effective international entities that lie between the individual and the Westphalian state,70 and the future of international law in general. The seeming preposterousness of such a suggestion underscores the puzzle that current developments present: Fresh changes in the global legal order are undeniable, but their extent and meaning remain unclear. Current developments allow excessive manipulation by small, powerful groups. Protecting disempowered, poorly situated localities requires an institutional arrangement providing for monitoring and the inducement of interlocal cooperation. Bureaucrats and courts are relatively less likely to be captured by small groups, and a well-structured institutional decisionmaking process has better chances of counterbalancing “the relative edge smaller 67. Indeed, international law recognizes states’ competence to delegate treaty-making power to international organizations, but not a similar competence for localities. See generally Vienna Convention on the Law of Treaties, art. 5, May 23, 1969, 1155 UNTS 331, 334. 68. Benvenisti’s research into the mechanisms of natural resource management is a ªne example of such transnational and regional authorization of local competence. See Benvenisti, Sharing Transboundary Resources, supra note 5 at 131–55. 69. See generally Richard B. Bilder, The Role of States and Cities in Foreign Relations, 83 Am. J. Int’l L. 821 (1989). See also Sarah H. Cleveland, Crosby and the “One-Voice” Myth in U.S. Foreign Relations, 46 Vill. L. Rev. 975, 994–98 (2001). 70. The most fascinating example is the Free City of Danzig. Danzig was part of the territories that were transferred from German to Polish sovereignty after World War I, thus turning previously German citizens into Polish ones, while securing their autonomy vis-à-vis the Polish government through the status of Danzig as a Free City. See Treaty of Versailles, June 28, 1919, arts. 102–04, Consol. T.S. 188, 247–48. However, scholars never took seriously the idea of Danzig as “city,” rather than a mere semistate or semi-sovereign, in part because international law scholarship exhibits marked ambivalence toward the conception of so-called “cities” as unique creatures. These old conceptions will need to adapt; if cities once again assume legal personhood in international law, they could very possibly resemble the Free City of Danzig. See Nathaniel Berman, “But the Alternative Is Despair”: European Nationalism and the Modernist Renewal of International Law, 106 Harv. L. Rev. 1792, 1820, 1875–78, 1886–93 (1993). 2006 / Localism in the New Global Legal Order 281 groups have in obtaining information and exerting leverage during the negotiation and ratiªcation process.”71 Direct standing in such a decisionmaking process will help render processes that are currently hidden and opaque more transparent and accountable. Such institutions can and should be designed both in the international arena as well as through transnational agreements. IV. Conclusion The localist turn in international law and global governance is not merely a return to early-twentieth-century experiments, to nineteenth-century citystates, or to medieval independent cities; instead, it is a radical reform of the view of both localities and states. Localities are no longer mere bureaucratic subdivisions of states, regular state agents, or regular public corporations. Rather, localities have become veritable partners in the emerging global legal order, where states still hold sway but where nonstate actors become increasingly inºuential. The process of globalization reºects a novel governance strategy that contemplates localities as vehicles for the dissemination of contemporary ideas and political theories. Within this unique intersection of ideology, political theory, and governance strategy exists the current “turn to the city” in the global sphere. The unique legal structure of localities and their singular traits enable them to capture human imagination like no other entity. Even when big, pluralistic, and multicultural, localities suggest the possibility of imagining a community in a more concrete form than extant at the national level.72 Indeed, if every group identity is always somewhat imaginary, what deªnes the locality as an imagined community is that it is still grounded in daily experience. Unlike other collective identiªcations, however, belonging to a locality is based not on race, religion, gender, ethnicity, or other inherited traits but on shared knowledge and a shared way of life. The era of globalization both threatens to destroy, and promises to rescue, this unique collectivity. 71. Benvenisti, Exit and Voice, supra note 5, at 204. 72. For a discussion of the nation as an imagined community, see generally Benedict Anderson, Imagined Communities: Reºections on the Origin and Spread of Nationalism (1983). Volume 47, Number 1, Winter 2006
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