What's more, at least 20 states are currently considering raising their tobacco taxes. In April, New York will increase its per-pack tax to $1.50--the highest rate in the nation. Even legislators in the tobacco-growing state of Kentucky are mulling a tax of 44 cents per pack, which would be a 1,466 percent increase. "There's no doubt and no question that tobacco companies have far less credibility than other corporations and other entities with some people," concedes Tommy Payne, an executive vice president at R.J. Reynolds. "That's just a fact of life."
Yet despite the recent series of public relations and financial blows, the industry still manages to claim a surprising number of victories--or at least successful defense--in the legislative arena.
Over the years, tobacco companies have come to recognize that sometimes the best strategy is to leave the frontline fighting on their issues to others. The ways in which they do this--by forming alliances with other, more popular entities, by spreading campaign cash around and by simple perseverance in argument--offer lessons to any industry in how to curry favor from policy makers.
Tobacco companies, of course, continue to send representatives to testify before legislatures all across the country. They favor hiring lobbyists in capitols who have earned credibility with legislators as former colleagues or by working for other, less controversial clients. They also seek other groups, such as restaurant associations and taxpayers' leagues, to take the lead on a lot of their fights. "We're going to participate in a very upfront way," says Brendan McCormick, spokesman for Philip Morris. "But like any other industry, we're going to look to people who share that point of view on any given issue" to take a role as well.
In an official voter pamphlet last year in Washington State, the argument against a 60-cent-per-pack tobacco tax increase initiative was signed by the Washington Association of Neighborhood Stores, the Korean American Grocers Association and a few individuals. An e-mail version of the statement, however, made it appear that the statement had been generated on McCormick's computer in New York, earning much negative press for the tobacco company. Philip Morris decided not to make much of a financial effort in fighting the Washington initiative after spending $21 million nearly sinking a similar proposition in California in 1998. "They became the biggest reason to vote for the initiative," says Frank Greer, a consultant to both the Washington and California initiative campaigns. "They become the issue when they are as actively involved as they were in California."
Nebraska state Senator Nancy Thompson wasn't very surprised when she started getting calls opposing a restaurant smoking ban she had proposed. She was astonished, however, when she listened carefully to a voice-mail message left at her office and overheard a telemarketer coaching her constituent on what to say. During a big lobbying push, it's not unusual for interest groups to help facilitate constituent contact with legislators, and there's certainly nothing illegal about it. But this kind of active recruitment of constituent complaint is indicative of the tobacco companies' increasing reliance on surrogates to get their arguments heard. Tobacco companies further helped their chances by giving campaign donations to just over half of the senators who voted against Thompson's bill last year.
There will be two smoking-ban initiatives on the Florida ballot this fall. One would make an outright ban on smoking in restaurants and workplaces part of the state constitution. The other one is a countermeasure designed to maintain the status quo. The latter effort is sponsored, in part, by Philip Morris and is a major focus of its political efforts for this year. But no tobacco representatives were present at the February news conference launching the effort. Instead, the stage was given over to restaurateurs and Tom Slade, a Republican National Committee member who is running the initiative campaign. "This is basically a free enterprise, property rights cause that happens to coincide with an issue that would be to the ultimate benefit of tobacco," Slade says.
The desire to frame issues as economic rather than public health- related is a cornerstone of the tobacco lobby's strategy. Rhode Island state Representative Elizabeth Dennigan has tried for five years to pass a bill banning smoking in restaurants in the state. The first year, Dennigan recalls, she concentrated on public health arguments, such as the much higher rate of cancer among waitresses than adult women as a whole. Such an approach, she says, seemed almost beside the point in a fight that soon centered largely on the cost to restaurants. The restaurant and hospitality industry is skilled at presenting anecdotal evidence suggesting that restaurants lose up to 30 percent of their business when smoking bans are imposed. Broader studies indicate less of an impact--or even a positive boost. For her part, Dennigan emphasizes her belief that smoking bans will eventually save restaurants money on fire insurance, cleaning and other costs, skipping the health chat.
"It's hard for tobacco companies to even dispute the health argument," says Melvin Thompson, director of government relations for the Maryland Restaurant Association. The association has been busy this session trying to fend off a legislative proposal to end the restaurant industry's exemption from the state's ban on smoking in workplaces. "We are not fighting it from a health standpoint," Thompson says. "We are fighting it from an economic one." When proponents of smoking restrictions don't have tobacco companies playing a major public role as their enemies on an issue, and when the debate has shifted away from public health concerns to economics, they have lost their most effective weapons.
The Oregon Restaurant Association, working without much public assistance from the tobacco lobby, succeeded last year in pushing for a state law to preempt stricter local smoking bans in bars and taverns. The association had spent nearly $300,000 on the 2000 elections, making it among the top 10 legislative campaign donors in the state. "My impression is that the tobacco companies very much wanted the Oregon Restaurant Association out front," says Oregon state Representative Jeff Merkley. "They see it as a much more palatable force for pushing the legislation than the tobacco companies directly."
Sometimes the tobacco companies go to the trouble of setting up or funding innocuous-sounding interest groups such as the Minnesota Accommodation Coalition, Fairness Matters to Oregonians and the Committee for Responsible Solutions (Slade's group in Florida). Other times, there's an attempt to fit the other side for a black hat. The Minnesota Partnership for Action Against Tobacco (MPAAT), an anti- smoking agency set up by the state's legal settlement with the tobacco industry, was called in front of a state House committee earlier this year to explain why it spent more than $1.5 million pushing for local smoking bans. MPAAT's money, its critics say, should go strictly toward handing out nicotine patches and otherwise helping individuals kick their habits, rather than lobbying. "They have every right to push for those things, they just don't have a right to subsidies from taxpayers," argues state Representative Tim Wilkin, who opposes smoking bans. "They're politicking rather than helping people quit."
Denouncing a group for misappropriations of funds or not concentrating on its central mission is a common tack, one that further removes the debate from the question of saving lives. When their enemies don't present much of a target, the tobacco industry often finds a provision of a bill or initiative to criticize. A proposed smoking ban died in Hawaii this year partially because opponents were able to criticize the legislature itself for allowing smoking within its offices. "The tobacco industry knows it can't beat us on the health issue, whether it be secondhand smoke or smoking in general," says Judy Knapp, executive director of the Minnesota Smoke- Free Coalition. "So the thing they do is kill the messenger--attack our funding."
The public health lobby is sometimes easy to lampoon for its crusading earnestness. A strong case can be made that public health groups torpedoed the attempt to federalize regulation of tobacco products in 1998 by pushing too vindictively to punish tobacco companies. Last November, the council in Montgomery County, Maryland, approved legislation to fine people $750 for smoking in their own homes, if the smoke wafted over and annoyed neighbors. The county executive vetoed the proposal, but not before it had made the county a global laughingstock and added great ammunition to the tobacco company's arguments that smoking bans are overly punitive and interfere with freedom of choice.
But the tobacco companies are careful not to push their luck too far. They either hide behind figurative big brothers to fight their battles for them or adopt a hangdog, defeated attitude as the most-taxed, most-despised industry in the country. Through persistent lobbying and campaign donations, however, they make certain that their arguments are heard--even if their critics complain that they're clouding up the real issue of public health. Forced to play defense on major issues, the tobacco companies have done a pretty decent job of combating smoking bans, if not tax increases, while enjoying better relations with legislators and attorneys general than they did in the pre- settlement days.
"We have a closer working relationship than we had before with certain people," says McCormick, the Philip Morris spokesman. "That doesn't mean that they aren't going to beat us up."
