||On June 20, 1997 the U.S. tobacco industry,
state attorneys general, representatives of the public health community, and
plaintiffs' attorneys crafted a proposal that would transform the way tobacco products
are regulated, manufactured, marketed, and sold in the United States. Tobacco
companies agreed to pay $368.5 billion and accept extensive federal regulation
over their products and their advertising in exchange for protection from
Soon after the agreed settlement
reached money hungry Washington, politicains began scuttling the agreement and
drafted a classically liberal bill by Senate Commerce Committee Chairman John
McCain (R-AZ) that raised the agreed to price-tag from $368.5 billion to $516
billion to fund new bureaucracies and reneged on the agreement to grant the
industry immunity from lawsuits. It was only after this betrayal and breech of
agreement that the tobacco industry broke off talks on legislation.
They had an agreement with the
tobacco industry a year ago! It was an agreement that presumably fulfilled
their stated desire to "protect the children." But now, because of their greed,
Democrats have blown it. They had an agreement a year ago - now they have
Championed by recent settlements between states and the
tobacco industry, Congress attempted to pushing through one of the largest tax
increases in American history called the
Policy and Youth Smoking Reduction Act.
The bill would:
- Increase cigarette taxes by $1.10 over
five years. Senator Kennedy has proposed even a higher increase of raising
taxes by $1.50 a pack. Those people earning less than $30,000 a year would pay
53% percent of this tax increase and a whopping 97% of the taxes would have
come from people making under $75,000. Section 404 of the bill specifically
forbade the tobacco companies from paying the tax on smokers behalf. This
is not a tax on the tobacco companies ... it's a tax on the American
- Cap the amount of damages the industry
would pay plaintiffs at $6.5 billion a year.
- Limit the cigarette industry's ability to
advertise, with restrictions on billboard advertising.
- Give the Food and Drug Administration the
power to regulate nicotine.
- Impose up to $3.5 billion a year in fines
if youth smoking does not fall by agreed-on goals.
- An $18 billion buyout program for tobacco
The media has largely mischaracterized this bill as a
measure that would punish tobacco companies by having them pay an estimated
$516 billion over the next 25 years. The truth is ... the tobacco companies
don't pay that $516 billion ... consumers pay and the American taxpayer pays!
The McCain bill
required the tobacco companies to make annual payments to the government, and
to pass through the costs to consumers. McCain's bill is not unique in this
respect: All proposed tobacco legislation would, through "pass-throughs" or
direct taxes, raise prices for consumers.
McCain's bill represents
the largest tax increase in American history being disguised as a punitive
action against an evil industry causing millions of deaths of Americans. It is,
in fact, a massive tax increase to fund expansion of the federal bureaucracy.
WAKE UP folks, they are after your wallet! It is going to cost hundreds
of billions of dollars, spent on a myriad of programs, a lot of which don't
have to do with tobacco.
smoking is not the central thrust of what's happening here. This is a massive,
massive tax increase on low income Americans and instead of helping children it
is very likely to end up hurting children and hurting families." - Sen. John
"Everybody that has touched it has made it worse," said
Senate Majority Leader, Trent Lott, R-Miss. "It's become such a massive tax
bill now -- such a massive government program with incredible
In conrast to this huge tax bill, Republicans have
introduced their approach. "The time has come to say no to drugs, no to
teen-age smoking and no to tax hikes on middle Americans," said Rep. Deborah
Pryce, R-Ohio. The Republican plan does not contain the provisions to
dramatically drive up the price of cigarettes, as public health groups favor,
nor the limits on lawsuit liability that the tobacco industry favors. It does
provide for an anti-smoking advertising campaign, restrictions on tobacco
advertising aimed at minors and limited regulation of cigarette manufacturing.
In summary the bill would:
- Deny tobacco companies the legal shields they demand.
- Approve new authority to the Food and Drug Administration to
regulate the manufacture of tobacco products.
- Grant the Federal Trade Commission ``enhanced authority and
penalties to vigorously police tobacco advertising to teenagers.''
- Launch a national advertising campaign, overseen by the White
House's office of national drug control policy to discourage teens from smoking
and taking drugs.
- Create federal guidelines for states to enact laws penalizing
sellers of tobacco to minors.
- Encourage states to penalize minors who possess tobacco by
notifying their parents, suspending their drivers' licenses and requiring them
to perform community service.
- Allow states that cap lawyers' fees to keep proceeds of their
lawsuits against tobacco companies.
Who would have benefited
most from the National Tobacco Policy and Youth Smoking Reduction
The Federal government expects to collect $860 billion from
this tax increase. A large part of the money taken from low income familes will
be spent to pay against the National Debt and fund 17 new bueracracies. The
Food and Drug Administration alone was to get an additional $100 million in its
budget for their Youth Tobacco Prevention Program.
FBI and DEA
The Senate approved a GOP-backed amendment to spend billions
of additional dollars on the war on drugs.
This National Lawyer Enrichment deal will not make attorneys
instant millionaires. . . . Some of them will become BILLIONAIRES! Rather than
spending huge amounts of money on children's health or health in general, a
small group of trial lawyers will be enriched with limitless fees charged
through tobacco related litigation. Provisions of the proposed tax legislation
before Congress allows families to be taxed in order to pay plaintiffs
attorney's as much as $4,000 an hour to pursue tobacco related lawsuits.
Sen. Orrin Hatch (R-Utah) defended
trial lawyers ability to collect huge fees, calling them the "last bastion of
freedom." Republicans have sought to ease this massive enrichment of attorneys
by limiting them to only $1,000 an hour! Yep, that's right, $1,000 an hour!
While that may be a whole lot less than $4,000/hr., it's still a whole lot more
than most people earn in a week.
profit. The vulture mentality of trial lawyers now use the court
system as a legal playground for the purpose of extortion of funds from
targeted defendants. Today it is tobacco, tomorrow will be a different target,
take your choice. They will use the billions of dollars they get from a tobacco
bill to file suits against other industries creating a nightmare in our legal
The states attorney's generals are
looking to the deep pockets of tobacco companies and those who choose to smoke
to pay for their failing medicare systems. A large part of the money raised
through this tax increase would be returned to the states to help pay their
The Centers for Disease Control and Prevention's (CDC) released a
report in 1994 claiming that smoking-related disease in the United States has
an enormous economic impact. In 1993, it was estimated that the direct medical
costs associated with smoking totaled $50 billion. For each of the 24 billion
packs of cigarettes sold in the United States in 1993, about $2.00 was spent on
avoidable medical care costs due to smoking. The study also found that smoking
is responsible for approximately 7 percent of total U.S. health care costs;
Federal and state funds pay more than 43 percent ($0.89 of the $2.06 per pack
expenditure) of all smoking-attributable medical care expenditures; and in
1993, hospital expenditures accounted for 54 percent ($27 billion) of all
smoking-related medical costs. Other costs were for physician expenses (31%),
nursing home expenses (10%), prescription drug charges (4%), and home health
A substantial amount of money ($23
Billion) was earmarked to pay for Hillary's government sponsored child care -
one piece of her failed health care industry takeover. According to a
press release from
the Children's Defense Fund, "Any tobacco legislation this year, with or
without a settlement, ought to make sure that tobacco money is used to ensure
the healthy development of future generations. Quality child care and
after-school activities are cornerstones of our children's healthy
P art of the money is slated for
new anti-smoking advertising. The American taxpayer is expected to pay for the
government's propaganda campaign.
A significant amount of money ($350
million a year) raised by this tax increase would be sent to foreign
governments to help them study smoking in their own countries.
Nearly 1,500 anti-smoking activists attended the 10th World
Conference on "Tobacco or Health" in Beijing where one of the big issues was
how to get some of the dollars from the massive U.S. settlement distributed
worldwide - especially in China, the world's single largest producer of
cigarettes. The conference was organised by the Chinese Association on Smoking
and Health and the Chinese Medical Association under the auspices of several
international bodies, including the World Health Organisation (WHO), the United
Nations Conference on Trade and Development (UNCTAD), the United Nations
Children's Fund (UNICEF), the International Union Against Cancer and the
American Cancer Society. The co-organisers and sponsors are Bionax, the
Australian and Hong Kong-based healthcare company.
from the 10th WCTOH is originally published by
What About Families and
Families don't benefit nor do the
children in those families. Those same families and children this bill is
supposed to help will actually lose. The lions share of the tax burden will be
borne by those families with incomes less than $30,000. Money these familes
could save for their children's education or health care will be collected by
the government in higher taxes.
Raising cigarette taxes was paramount to telling my 80-year-old
Marlboro-smoking mother that "she´s been victimized all her lifetime
because Joe Camel is making her smoke and now we´re going to victimize
you more [with taxes]. - Sen. Phil Gramm (R-TX)
In an effort to placate some opposed to the tobacco bill because of
its high cost to familes, Congress passed an amendment crafted by Sen. Phil
Gramm, to cut taxes and eliminate the Marriage Tax Penalty in exchange for
higher taxes on smokers. What likely was an attempt by Sen. Gramm to kill the
Tobacco Bill with this amendment, turned out to backfire. Democrats and
Republicans both can now focus on the return of an unfair tax in exchange for a
greater tax and say they have done something for families. What a betrayal to
the American taxpayer!
about this Clintoneze stealth tactic to make you feel good about having
your taxes raised.
A Victory for Whom?
Even in defeat, liberals continue
to press their mantra, "Big Tobacco, or your Children." Just prior to the vote
killing the bill, its author, Sen. John McCain (R-Ariz.) said, "If this bill
fails, have no doubt, the tobacco companies win and the children of America
lose." Sen. Tom Harkin, D-Iowa, said, "Joe Camel wins and our children will
It is a win for the
tobacco industry. They have survived being taken over by the federal
It is a win for
the children of America. Their parents will not be taxed the thousands of
dollars a year this bill would have imposed. They can now spend that money for
things their children really need like health care, food, clothing, etc.
It's a defeat for Bill
Clinton. The Clinton White House failed to take over the Health Care industry,
and for now have been held back from pushing through some of the provisions of
their failed health care takeover. The bill would have funded several Clinton
intiatives: $13 billion for anti-smoking programs, $13 billion for cancer
research, and $23 billion for child care.
Moreover, it's a defeat for the
Clinton Whitehouse in taking over yet another American industry: the tobacco
growers. Following his defeat, Bill Clinton said, "I want the tobacco lobby and
its allies on Capitol Hill to know that, from my point of view, this battle is
far from over." "If more members of the Senate would vote like parents rather
than politicians, we could solve this problem and go onto other business of the
country." Yes, Mr. Clinton, if more members of the Senate would vote like
parents, you would be sitting in a jail cell or at least unemployed!
It's a victory for the American
taxpayer. This bill was an attempt to impose the largest tax increase in
American history on American citizens, and for the time being, those taxes will
not be imposed. Senate Majority Leader Trent Lott correctly pointed out the
problem, "We've lost sight of the original noble cause of just dealing with
teenage smoking and drug abuse." Is that any surprise?
Beware... Democrats have promised
to not let this thing die. They will be back attaching amendments to every
piece of major legislation they consider in the hopes of pushing their agenda
through piece by piece.
Maybe now, lawmakers can get back to the real issue of
reducing teen smoking. But, like I've said over and over again in these pages,
"it's not about teen smoking," it's about your
money and their control over you. Don't hold your breath for any good
legislation dealing with teen smoking, but watch for the hands of government
reaching into your wallet.
Bill Clinton is right in one thing: "... this battle is
far from over." With this bills defeat, the issue will become an explosive
political issue for the fall campaign.