Tuesday, November 27, 2012

Campaign for Tobacco-Free Kids Boasts that Master Settlement Agreement Held Tobacco Industry Accountable for Its Deadly Products and Deceptive Actions

In a statement congratulating Senator-elect Heidi Heitkamp (North Dakota) on her election, the Campaign for Tobacco-Free Kids praised her for "protecting her state's kids and health from the tobacco industry" by being a leader in achieving the 1998 Master Settlement Agreement (MSA) between 46 states and the four major tobacco companies.

According to the statement: "In electing Heidi Heitkamp as their next U.S. senator, the voters of North Dakota have chosen a true champion in protecting her state's kids and health from the tobacco industry. The Campaign for Tobacco-Free Kids congratulates Senator-elect Heitkamp on her victory and looks forward to working with her to win the fight against tobacco use, the nation's number one cause of preventable death. As North Dakota's attorney general, Senator-elect Heitkamp was a leader in achieving the 1998 state tobacco settlement, which held the tobacco industry accountable for its deadly products and deceptive actions and restricted some of the industry's most harmful marketing practices."

The Rest of the Story

Far from protecting her state's kids and health from the tobacco industry and holding the tobacco industry accountable for its deadly products and deceptive actions, former Attorney General Heitkamp actually protected the profits of Big Tobacco and released the companies from accountability by leading the efforts to immunize the companies from further lawsuits in return for a hefty monetary payoff.

From the perspective of the tobacco companies, the Master Settlement Agreement was brilliant. The states are now fiscally dependent on a steady stream of cigarette revenues. Any substantial drop in cigarette smoking threatens the state's fiscal situation. Thus, there is no incentive to take any action that will substantially reduce cigarette sales. Perhaps this is why we haven't seen many major anti-tobacco initiatives at the state level since the Master Settlement Agreement was signed. We've seen mostly minor initiatives that dilly dally around the margins, but very few which actually aim to put a major dent in cigarette sales.

Big Tobacco could not have scripted a happier (more favorable) ending to the Master Settlement Agreement saga. If they had sat down and tried to figure out a way to institutionalize tobacco consumption and to find a way to make the states become dependent upon tobacco sales for their economic survival, they could not have come up with a better scheme than this.

Out of their greed for political and economic gain - and under the leadership of Heitkamp - the Attorneys General did a tremendous service for the tobacco companies. They created a financial partnership between their states and Big Tobacco, by which the fiscal solvency of the states depends on continued high levels of cigarette consumption. They have destroyed the incentive for states to take any action that might substantially reduce cigarette use.

This explains why so few states are running effective tobacco control programs, why so few states are allocating their MSA money to anti-tobacco programs, and why Congress (aiming to protect the states they represent) crafted tobacco legislation that does very little to actually make a dent in cigarette consumption

The bottom line is that the tobacco companies have the states coming and going. The MSA scheme was brilliantly concocted by the companies: no matter what the states do, their financial well-being is inextricably tied to that of the major cigarette companies. The partnership between the two is strong and irrevocable, and the risk of states taking any major action to threaten tobacco profits is nil.

This is the ultimate reason why I think that the MSA was such a disaster from a public health perspective. Contrary to what the Attorneys General have boasted, the MSA was about money, not public health. It is a public health disaster by virtue of it providing the states with 100% security - security against the states having any incentive to enact tobacco policies that would threaten their profits.

The MSA is a huge security contract for the tobacco companies. By paying off the politically and economically greedy Attorneys General, the major tobacco companies have succeeded in achieving not only protection of their profits from competition from smaller manufacturers, but also strong partners in protecting their profits from any other threats - including litigation (a.k.a. the Price and Engle bond payments) and substantially declining cigarette consumption.

The major cigarette companies deserve this protection - they earned it by outsmarting the Attorneys General and enticing them by dangling $206 billion in front of them. They are effectively protecting the best interests of their shareholders.

But the American people deserve far better from their elected officials. The Attorneys General are not protecting the best interests of their citizens; far from it - they have sacrificed the public's interest for political and financial gain.

In direct contrast to what the Attorneys General predicted, the Marlboro Man isn't riding into the sunset on Joe Camel. Instead, they're both having a beer and a good laugh together as they enjoy their trip to the bank. And that trip to the bank is possible due to the efforts of former Attorney General Heitkamp.

No comments: