TOBACCO SETTLEMENT: $206 Billion Deal To Be Inked Today

      "The largest legal and financial threat to the tobacco industry ended" Friday when 46 states agreed to accept the landmark $206 billion settlement with the tobacco industry. The four major tobacco companies are expected to sign the agreement today (Meier, New York Times, 11/21). The settlement will net California about $23.9 billion over 25 years. In a statement this weekend, state Attorney General Dan Lungren (R) said, "California receives more money in this settlement than it would receive in a trial. Moreover, the tobacco industry will dramatically change its business practices, no longer targeting our youth or misleading the public" (AP/Sacramento Bee, 11/23). NBC's Pete Williams reported, "It's a remarkable legal victory, given that no state has ever won a jury verdict against a tobacco company, a sign of how much the industry thought it had to lose" (NBC "Nightly News," 11/20). The Los Angeles Times reports that the deal effectively ends California's 10-year legal war with tobacco (Levin/Weinstein, 11/21). Christopher Foreman of the Brookings Institute said, "The tobacco industry knows this (deal) is a winner. They get a lot of predictability in their future marketing environment ... they keep the legal process at bay ... and they can say to people that they have done something in the interest of the public." While the public health community continued to criticize the deal, attorneys general involved in the process defended their work as the best the states could have hoped for. Maryland Attorney General J. Joseph Curran Jr. (D) said, "No one -- not Congress, not the public health community --has delivered more than this particular settlement" (Torry/Schwartz, Washington Post, 11/21). Washington Attorney General Christine Gregoire (D), the states' lead negotiator, added, "To those who say it is not enough, I say we simply couldn't afford to come away with nothing" (New York Times, 11/21).

Mine, Mine, Mine!!!
      The Philadelphia Inquirer reports that the deal now shifts the focus "out of state courtrooms and into state capitols, where lawmakers must hash out how to spend the money" (Gibson, 11/21). While "[c]ourts in each state must approve the pact before any money is delivered, a process that could take months," state officials and legislators are already batting about ideas for how the money should be used -- from tax relief to public health initiatives to football stadiums. Connecticut Attorney General Richard Blumenthal (D) said, "There's no question that these tens of millions of dollars will prompt a major grab -- and probably not a very genteel one." The federal government may also attempt to recover a portion of the take on the grounds that its Medicaid dollars were also burned by the tobacco industry. While Gregoire "said states would consider any recommendations from Washington on how to spend the money, [they] wouldn't relinquish any of their hard-won dollars" (Geyelin/Hwang, Wall Street Journal, 11/23). The Clinton administration indicated that it might drop any claims to the money should states agree to use the money for public health and tobacco-control programs. "We're willing and eager to seek a resolution with the states and the Congress," said spokesperson Susan Gegenheimer (Inquirer, 11/21). "Since California already has an anti-smoking program, added funding from the tobacco settlement may prove a hard sell," the Los Angeles Times reports. The Campaign For Tobacco-Free Kids, however, said a nationwide poll showed 84% support for "spending settlement proceeds on efforts to reduce teen smoking" (11/21).

From The Editorial Pages

• C. Everett Koop and David Kessler, writing in Friday's Washington Post: "The public, especially public health experts, once again was specifically excluded from complicated negotiations. ... Some have called this a 'milestone' in the war against tobacco, implying that Congress will take up the issue again. But this agreement would in fact mark one of the last miles in this long war. ... This settlement might be quick, but it is no fix" (11/20).
• Philadelphia Inquirer: "One could wish the deal were better or lament one more time that Congress lacked the gumption last summer to legislate a better deal. But the good news is that the settlement, despite the escape hatches it offers tobacco companies, likely will send Pennsylvania enough money to conduct a strong antismoking program. ... Gov. [Tom] Ridge (R) should provide leadership to make sure that money is spent where it should be: on the needs of children, particularly those who've been left behind even in these good economic times" (11/22).
• Fairfax, VA Journal: "This wasn't really about stopping teenagers from smoking. ... No, this was all about exacting tribute from the most politically incorrect corporate empire, even though no one puts a gun to smoker's heads to light up and they already pay higher taxes that states can use for public health programs" (11/23).
• Sacramento Bee: "[T]he crucial public policy issue here is not paying for the costs of past smoking, but reducing the number of young people who will take up smoking and impose future costs, both on themselves and society. And on that measure, the deal lets the tobacco industry off easy. ... [T]he shortcomings of the deal now leave the job of securing strong youth smoking controls to Congress. And on the record of this year's craven surrender in the Senate, the tobacco industry seems to have little reason for fear, or the public little reason to hope" (11/20).
• St. Petersburg Times: "The national tobacco deal unveiled last week is not nearly as sweeping as the grand settlement Congress bungled last year. But it represents a responsible, if modest, resolution of state lawsuits against cigarette makers, one that might just actually accomplish some good. Instead of grousing about what might have been, federal lawmakers should move quickly to take the next step: Put tobacco under the regulatory control of the Food and Drug Administration" (11/22).