IPS on intl tobacco and the states' deal

[Robert Weissman <rob@essential.org>]

HEALTH-U.S.:  TOBACCO DEAL IGNORES GLOBAL PROBLEMS, CRITICS SAY

By Farhan Haq
   NEW YORK, Nov. 17 (IPS) -- A $206-billion settlement unveiled
by major U.S. tobacco companies will go towards paying for the
health costs of smokers in the United States, but critics argue it
will not help the new pool of smokers worldwide.
   Analysts of international tobacco sales contend that the
settlement announced yesterday between four tobacco giants --
R.J.R. Nabisco, Philip Morris, Brown and Williamson and Lorillard
-- and eight U.S. states does little to deal with the main problem:
the huge expansion by those companies in overseas cigarette sales.
   "There is not a single international tobacco-control measure in
this deal," says Robert Weissman, co-director of Essential Action,
a Washington-based group which opposes the big tobacco firms. "The
attorneys-general who are backing this are making a mistake."
   "It is irresponsible of the attorneys-general to let big tobacco
(firms) off the hook," adds Karen Licavoli, associate executive
director of the American Lung Association of San Francisco. "Any
settlement must protect public health both in the United States and
abroad."
   The deal's defenders contend that the settlement will provide
$206 billion to states -- the largest amount given in a civil suit
ever -- to help those states recoup money spent on health care for
people suffering from lung cancer, emphysema and other
smoking-related ailments. More than $12 billion, as well as two
billion spent to build awareness about the dangers of smoking, will
be given in an initial lump payment, with the rest being
distributed between now and 2025.
   President Bill Clinton, who has criticized recent tobacco
dealings with state attorneys-general as insufficient, nevertheless
hailed the deal yesterday as "an important step forward" and urged
Congress to legislate federal regulation of tobacco.
   Attorney-General Christine Gregoire of Washington commented:
"It's time to stop the legal bickering and move the tobacco fight
out of the courthouse and into the streets." Her state is one of
the eight that accept yesterday's settlement, the others being New
York, California, North Carolina, Colorado, Oklahoma, North Dakota
and Pennsylvania.
   Yet although the money may help make up for the cost of
providing health care to afflicted smokers in the United States in
years to come, the new generation of smokers have no recourse,
analysts say.
   "The deal is a setback for international tobacco control,"
argues Ross Hammond, an economist who is the author of "Addicted
to Profit: Big Tobacco's Expanding Global Reach." "Public health
groups completely ignored this issue -- it's the elephant in the
room that nobody sees."
   The United Nations predicts that annual deaths from
tobacco-related disease will rise from 3.5 million today to 10
million by the year 2025, Hammond notes, with much of the current
increase occurring overseas. Big firms like R.J.R. Nabisco and
Philip Morris are expanding operations and joint ventures heavily
in China, India, former Soviet republics, Thailand, Tanzania and
Brazil, Hammond says -- although, he adds, no corner of the globe
is immune.
   "One of the key reasons the industry settled the case is to get
peace at home while it can expand massively abroad," argues
Weissman. Already, overseas cigarette sales account for
approximately half of R.J.R. Nabisco's and Philip Morris's total
tobacco profits, he adds, with newly-prosperous Asian countries
like China a particular target.
   "The problem is that many of their old consumers die, so they
have to keep searching for new consumers," Weissman says.
   In the United States, that has meant targeting teenagers through
catchy advertisements and promotional gimmicks, some anti-smoking
groups -- and President Clinton -- have argued.
   Although tobacco firms deny trying to recruit smokers among the
young, the settlement yesterday promises to prohibit some of the
companies' attention-grabbing manoeuvres, including billboard
advertisements and T-shirts bearing company logos.
   Yet even in the United States, the effects of the deal may be
limited. The Financial Times notes that the cost of the settlement
"will be passed on to smokers in the form of a surcharge -- a tax
in all but name -- on the price of cigarettes." As a result of the
settlement, U.S. cigarette prices are expected to rise from an
average of $2.05 a pack to $2.60.
   That price increase may discourage some U.S. youths from picking
up the smoking habit. But the tobacco firms have been aware for
years that their fortunes in the U.S. market are in decline, says
Hammond. "The trend is that overseas is where the future lies," he
contends.
   Balanced against that threat is the growing awareness by
developing nations that the long-term health costs of smoking might
outweigh any benefits of taxing cigarette sales, Hammond argues.
More countries are trying to restrict cigarette sales now than a
few years ago, he says.
   Similarly, the World Health Organization and U.N. Children's
Fund are beginning to move aggressively against smoking, Hammond
adds. "We can only hope that the pro-tobacco forces in the United
States won't try to hamstring the United Nations from doing the
important work that needs to get done (in tobacco control)," he
says.
   The eight states that signed up for the settlement yesterday may
just be the tip of the iceberg among states wanting to join in the
lucrative deal. Thirty-eight other states may also accept the
settlement this week, which would entitle them to share in the pot
of money as long as they agree to drop any future civil lawsuits
against the tobacco firms. Four states -- Mississippi, Minnesota,
Florida and Texas -- already agreed to an earlier, $40-billion
settlement this year.