In the new global economy, states are playing an increasingly important role as global market participants unto themselves. States, with a vested interest in strengthening their own economy, have increasingly sought to ease trade and cultural barriers with foreign powers by reaching across political borders and entering into arrangements with foreign entities. Many such arrangements occur between the states which border Canada and Mexico and involve regional concerns such as the water rights or forest fire control. But a surprising number of these international arrangements focus on strengthening the economic prowess of a particular region, irrespective of political boundaries.

There is a point at which such arrangements between states and foreign entities will run afoul of Art. 1, § 10 of the US Constitution. However, particularly in a post-NAFTA world, the latitude states have in participating as global players without the involvement of the federal government grows increasing unclear. This paper, prepared by Michael L. Maliner for Prof. Peter J. Spiro, is an empirical study of the various mechanisms with which states presently participate in the global market without requiring federal consent.

In an effort to distinguish between federal international activity and state international activity, the terms "subnational" or "transnational" shall be used to refer to state actions.

A. Subnational Agreements and Projects

States have consistently endeavored to interact and confer with foreign entities through means not violative of the compacts clause. Some of this subnational activity has been reduced to actual signed agreements. An alternative form of subnational activity is the regional alliance, a banding together of geographical neighbors irrespective to political boundaries.

1. Agreements

State activity in the way of written agreements falls into three categories: Sister State/Sister City Agreements; Memoranda of Understanding; and Cooperative/Cooperation Agreements. Unless otherwise specified, all of the quotations which follow come directly from the written agreements themselves all of which are included in the Appendix.

a. Sister State/Sister City Agreements

Between December of 1984 and early 1991, the States of South Dakota, Kansas, and Florida enacted identical Sister State agreements with the Province of Taiwan of the Republic of China. The entire text of these agreements follows:

Insofar as these are "Sister State" agreements, it is interesting to note that in each case, the agreement itself was signed by someone other than the governor of the state involved. The South Dakota agreement was sign by an individual identified simply as "Speaker." Conversely, the agreement involving Kansas was singed by the President of the Senate, the Speaker of the House of Representatives, the Senate Minority Leader, and was witnessed by the Lieutenant Governor.

A Sister City agreement of October 4, 1989 between the City of Taejon of the Republic of Korea and the City of Seattle calls for the signing entities to "place faith and trust between the two cities for mutual enhancement of friendship, promotion of cultural exchanges, advancement of trades, and to foster a better environment for education for citizens of the two cities." Likewise, the Sister City Agreement of December 18, 1989 between Olympia, Washington and Samarkand of the former U.S.S.R. states that the affiliation between the two cities "promises valuable exchanges between the sister cities in the areas of education culture and science. Not lacking in ambition, the latter agreement also states that "the growing friendship between the citiznes [sic] of Samarkand and Olympia reflects propitious conditions for political action aimed at promoting mutual understanding and curbing the arms race. . . ." The City of Seattle has a similar Sister City agreement with the City of Galway of the Republic of Ireland, in which, aside from the usual declarations of friendship, business cooperation, and cultural exchange, the signing parties agree

b. Memoranda of Understanding

In addition to the Sister State arrangements to which the Commonwealth of Massachusetts is a signing party, the Massachusetts Executive Office of Economic Affairs and the Secretariat of Industry of the Republic of Argentina jointly signed a Memorandum of Understanding.

Substantively, there is little if any difference between this Memorandum of Understanding and a Sister State agreement. As was generally the case in the latter, in the former the signing parties agree to "facilitate cooperation" in the area of education, and to "assist in the establishment of friendly and cooperative relations and programs to foster opportunities for the creation of joint ventures or direct investment, for Massachusetts and Argentine companies. . . ." In Article Four of the Memorandum, the parties agree

c. Cooperative/Cooperation Agreements

Cooperative/Cooperation Agreements are generally of greater length and substance than Sister State/Sister City Agreements. All Cooperative/Cooperation Agreements received are signed by the Governor of the U.S. state involved.

The State of Washington and the province of British Columbia are parties to an Environmental Cooperation Agreement signed by the Governor of that state and the Premiere of the Province of British Columbia. The agreement, a page in length, establishes a British Columbia/Washington Environmental Initiative whose purpose it is "to promote and coordinate mutual efforts to ensure the protection, preservation and enhancement of our shared environment for the benefit of current and future generations." The agreement goes on to state that "[t]he parties . . . agree to develop an action plan . . . reflecting mutual priorities and to enter into specific arrangements necessary to address environmental problems."

In a cooperative agreement of June 25, 1991 between the State of Texas and the Mexican State of Tamaulipas, signed by the respective governors of each entity, the signing entities agree