Having just mentioned PPMs in WTO law the other day, I was excited to see the same issue arise under U.S. law, in relation to a California law governing egg production. Here's the WSJ explaining the issue in an editorial:
Animal-rights activists have been lobbying Congress for years to adopt costly new food and environmental regulations in the name of more humane conditions for farm animals. Congress has repeatedly declined, and so groups like the Humane Society of the United States took their campaign to California, land of green salads and free-range chickens.
They succeeded in getting California to pass a law in 2010 barring the sale of eggs in the state unless they are laid by chickens housed in cages that are significantly larger than the current industry standard. Any U.S. farmer who wants to sell in California must meet the requirement by 2015, ...
Originally, the law, as passed in a voter initiative, applied only to California eggs, but it was later extended to out-of-state/country eggs:
Proposition 2, passed by 63 percent of voters in 2008, requires that hens should be able to freely lie down, stand up, extend their wings and turn around by 2015. The law essentially bans the use of small cages that cram the animals so tightly they sometimes cannot turn around.
Prop. 2, however, applied only to hens in the state. The bill signed by the governor means that farms outside California will have to abide by the Golden State's humane treatment law if they want to sell eggs here.
The WSJ then notes the domestic trade concerns that were raised in response:
The problem is that this violates the U.S. Constitution's Commerce Clause, which bars states from passing legislation that discriminates against interstate trade. Eggs are already regulated for safety under the Federal Egg Inspection Act. California's law imposes a different standard that threatens the economic health of egg farms nationwide and amounts to rank trade protectionism for California's home-state egg industry.
To deal with these concerns, an Iowa Congressman proposed a federal statute. Here's the WSJ:
With this in mind, Iowa Republican Steve King proposed the Protect Interstate Commerce Act to bar states from enacting restrictions on out-of-state agriculture producers. The amendment won overwhelming bipartisan backing, 33-13, when opponents tried to kill it in the House Agriculture Committee. The King provision passed as part of the House farm bill.
The animal activists are now trying to strip the provision from any House-Senate conference by saying it violates state rights. They're joined by California farmers who want to impose their new higher costs on every out-of-state competitor.
Here's how Rep. King explained his amenment:
The ... amendment prohibits states from enacting laws that place onerous conditions on the means of production for agricultural goods that are sold within its own borders but are produced in other states.
"I am pleased that the Committee passed my amendment, the Protect Interstate Commerce Act (PICA) because states are entering into trade protectionism by requiring cost prohibitive production methods in other states," said King. "PICA blocks states from requiring 'free range' eggs or 'free range' pork but covers all agriculture products listed in section 206 of the Agriculture Marketing Act of 1946. By 2014 California will require only 'free range' eggs be sold and the impact of their large market would compel producers in every other state to invest billions to meet the California standard of "means of production." PICA will ensure that radical organizations like the Humane Society of the United States (HSUS) and PETA are prohibited from establishing a patchwork of restrictive state laws aimed at slowly suffocating production agriculture out of existence."
And here's the provision itself, from the House version of the farm bill (whose status is uncertain at this point):
SEC. 12308. PROHIBITION AGAINST INTERFERENCE BY STATE AND LOCAL GOVERNMENTS WITH PRODUCTION OR MANUFACTURE OF ITEMS IN OTHER STATES.
(a) In General- The government of a State or locality therein shall not impose a standard or condition on the production or manufacture of any agricultural product sold or offered for sale in interstate commerce if--
(1) such production or manufacture occurs in another State; and
(2) the standard or condition is in addition to the standards and conditions applicable to such production or manufacture pursuant to--
(A) Federal law; and
(B) the laws of the State and locality in which such production or manufacture occurs.
(b) Agricultural Product Defined- In this section, the term ‘agricultural product’ has the meaning given such term in section 207 of the Agricultural Marketing Act of 1946 (7 U.S.C. 1626).
It's not clear to me that the federal statute is necessary; the dormant Commerce Clause might already apply here. In fact, there was a reference to this Clause as part of the official explanation put forward during the amendment process:
The King amendment would reinforce the Commerce Clause by asserting the right of a state to trade agricultural products with another state. States that a state cannot deny the trade of an agricultural product from another state based on its means of production.
So this statute "reinforces" the Commerce Clause, but I'm not sure what that means exactly. What would the dormant Commerce Clause say about such a law?
There is a battle here between federalism/subsidiarity, efficiency, and animal welfare goals. Which should win out? Should the states be able to do whatever they want in this area? Should the federal government take control of the situation? Should governments just stay out of it entirely? And furthermore, does the slight increase in cage size make all that much of a difference?
The parallels here with WTO law are interesting, and, in fact, it is possible that this California law could be challenged at the WTO on a similar basis.
It also occurs to me that you could imagine an international trade law provision along the lines of the proposed federal statute. To be clear, I'm not saying I support one! I'm just saying it would be interesting to imagine it. What if WTO law prevented domestic measures that are based on the "means of production"?
Finally, getting away from the legal technicalities and policy dilemmas, here's Stephen Colbert giving this issue his usual treatment: http://www.colbertnation.com/the-colbert-report-videos/427378/june-20-2013/steve-king-on-chicken-cages