Prominent Anti-Smoking Advocate Embraces Old Tobacco Industry Approach of Considering Social Security Savings from Premature Death in Evaluating Cigarette Tax Policy

Dr. Stan Glantz, on his tobacco blog, has written a commentary in which he applauds the Congressional Budget Office's (CBO) analysis of the effect of a 50 cent federal cigarette tax increase on the federal deficit because it finds that although the tax would increase spending for Social Security and Medicare as many lives are saved from smoking cessation, the net savings from reduced health care spending would outweigh these costs.

Dr. Glantz writes: "The Congressional Budget Office just published an important article, “Cigarette Taxes and the Federal Budget — Report from the CBO,”  in the New England Journal of Medicine on the health and economic effects of a 50 cent increase in the cigarette tax (which is indexed to increase with inflation).  The full report is available from the Congressional Budget Office here.  It is the most comprehensive and careful analysis of the long-term fiscal implications of a tobacco control policy I have ever seen. The CBO prepared a sophisticated demographic analysis that includes people aging into and out of the years that people smoke as well as the effects of quitting smoking on not only health care costs but also time in the workforce when people would be paying taxes as well as effects on living longer. ... As people live longer there would be higher health costs in old age, but these would be offset by taxes on their increased earnings until about 2060."

In response to concerns that the report considers the savings from people dying earlier and therefore not requiring Social Security or Medicare payments, Glantz writes: "I have received several emails from people expressing concern about this article because its summary says “By discouraging people from smoking, the higher excise tax would improve the average health status of the population … [L]ower health care spending per capita would push down fderal spending, but increased longevity would have the opposite effect …” [my emphasis]  As noted above, however, this does not mean that the cigarette tax would have a net effect of raising the federal deficit.  The actual conclusion of the paper is just the opposite:  In every year the federal deficit would be smaller.  It is just that in the out years – after about 2050 -- the net benefit would be less.  But there would still be a benefit."

Dr. Glantz also praises the methodology of the report and argues that it sets an example for analysis of other public health issues: "Another important contribution of this report is that it uses an increased cigarette tax as an example of a tobacco control policy to illustrate the larger methodology.  The same model could be used to assess the effects on the federal government for any tobacco control policy.  It also provides a strong framework for similar analyses at the state level."

The Rest of the Story

As I explained in an earlier piece, the CBO analysis is one of the most perverse policy analyses that I have ever seen. The authors are actually putting forward the argument that a major consideration in public health policy should be the fact that by saving tens of thousands of lives, a policy may result in increased spending for Social Security and Medicare because people will live longer.

By embracing this methodology and praising it as a model to be used in other policy evaluations, Dr. Glantz is unfortunately accepting the argument that savings from Social Security and Medicare from premature deaths is a legitimate factor in evaluating public health policies.

As I have argued, can you imagine the same argument being put forward regarding an analysis of whether the federal government should require health insurance companies to cover mammography? Would anyone in their right mind advance the argument that we should not require coverage for mammography screening because it would save the lives of thousands of younger women, therefore increasing Social Security spending because they will now live to be 65, rather than dying in their 40s or 50s and thus not becoming a drain on the system?

Should we consider that by requiring insurance companies to cover costly treatments for acute leukemia in children, the federal deficit could be affected because large numbers of children who otherwise would have died will now live long enough to enjoy their senior years and have children and grandchildren of their own?

Sadly, this is precisely the type of argument that Glantz is legitimizing.

The reason why Glantz is not disturbed by this argument: because overall, the CBO analysis came out in support of a tax increase. In other words, this perverse policy analysis is legitimate because it turns out that the cigarette tax resulted in a net benefit in terms of reducing the deficit.

Had the analysis shown the opposite, I would be willing to bet that Dr. Glantz would have criticized the report rather than embracing it. And I'm sure his main line of attack would be the following: How could the authors possibly have considered as a benefit of this policy the fact that thousands of people would live longer and thus be eligible for Social Security benefits? Furthermore, I'm confident that he would have been quick to point out that this strategy was used by Philip Morris in arguing against a cigarette tax increase in the Czech Republic, and that the company disavowed its own report and apologized after being attacked in the international media.

Is Dr. Glantz actually suggesting that it is perfectly appropriate to consider as a factor in public health policy analysis the fact that if we save lives, we are going to end up increasing the deficit because people will live long enough to enjoy Social Security and Medicare benefits? Unfortunately, that's precisely the argument that is implied by his embracing of the CBO report and his condoning of this perverse approach to public health policy analysis.

Suppose a similar policy analysis were to come out unfavorably. Suppose that the CBO analyzed the effects of a program to implement anti-smoking programs in the 50 states and determined that so many lives would be saved that the impact on Social Security and Medicare would be immense. Would Dr. Glantz then argue against that policy? Of course not. The point that seems clear to me is that he is supporting this analytic approach solely because it came out favorably.

This is essentially the new method being used in the anti-smoking movement to judge scientific evidence. If the evidence is favorable to our cause, it is good science. If it's not favorable, then it's junk.

Here is what a number of tobacco control groups and practitioners had to say about the idea of considering the effect of avoiding premature death on lowered Social Security costs in policy analysis when Philip Morris proposed the idea:

Senator Dianne Feinstein: "By including a cost-benefit analysis of human lives in its calculations, Phillip
Morris has stepped well-past the lines of decency and demonstrated, once again, that it conducts business in a manner completely disconnected from any sense of right and wrong."

Campaign for Tobacco-Free Kids: "Would a responsible, reformed tobacco company tell foreign governments that dead smokers are a good thing for their budgets?"

INFACT: "Even if it were true that smokers dying young would save money for the economy, it's a real scary logic on which to base policy."

Tobacco Products Liability Project: "The governments role normally is to protect the health and safety and welfare of their citizens so the idea that somehow or another the government or the state could be benefiting by their citizens dying off would strike anybody who has their conscious reasonably intact as being really quite dreadful."

I find it ironic that the anti-smoking movement is now embracing approach that we attacked Philip Morris for taking back in 2001. Eleven years later, what was good for the tobacco industry is good enough for us. When they used the approach, it was despicable because they are bad. But when we use the same approach, it's fine, because we're doing it for a good cause.