Senate Should Insist that House Tobacco Buyout Plan Be Excluded from Final FSC Bill

Statement of Matthew L. Myers President, Campaign for Tobacco-Free Kids

Jun. 17 2004

Washington, DC — Now that the U.S. House of Representatives has passed its version of the FSC/ETI corporate tax bill with an irresponsible tobacco buyout proposal included, we call on the U.S. Senate to insist that this proposal be excluded from the final bill.

This $10 billion, taxpayer-funded House buyout plan is a great deal for tobacco companies and a raw deal for everyone else. It does nothing to protect public health and reduce tobacco’s tremendous toll in health, lives and money. It makes taxpayers pay for the buyout instead of the tobacco companies. It adds to the federal budget deficit. It eliminates all price and production controls on tobacco, which would allow tobacco to be grown anywhere in the United States.

This House buyout shortchanges small family farmers and provides an unwarranted windfall to the tobacco companies. Tobacco companies benefit because they do not have to pay for the buyout and they end up with cheaper tobacco. The Congressional Research Service has estimated that tobacco companies will save between half a billion and two billion dollars a year under such a buyout proposal. In contrast, tobacco farmers are left with no economic safety net and at the mercy of tobacco companies. It’s no wonder that four of the leading tobacco-state newspapers - The Raleigh News & Observer, The Lexington Herald-Leader, The Louisville Courier-Journal and The Nashville Tennessean - have editorialized against the House buyout plan. The Lexington Herald-Leader called this plan the “doomsday bill” and wrote, “This really would be the end of the rural tobacco economy as we know it.”

There is a better way to both protect public health and help tobacco growers - pass effective Food and Drug Administration (FDA) authority over tobacco products and a responsible tobacco buyout paid by tobacco companies, not the taxpayers. Identical, bipartisan legislation is pending in both houses of Congress to grant the FDA authority over tobacco products. Legislation to provide growers with a more generous buyout that is funded by the tobacco companies has also been introduced. Congress should quickly agree to exclude the House buyout proposal from the FSC bill and instead pass effective FDA authority and a responsible buyout, independently and on its own merits, rather than as a play to garner voters for an unrelated bill. We remain committed to working with tobacco farmers and tobacco-state lawmakers to achieve these goals.

Voters know that that House buyout plan is a bad deal for them. Today we released the results of a nationwide poll of voters, conducted June 11 through 13, that showed 80 percent are opposed to the House tobacco buyout plan, including 67 percent who are strongly opposed. Republicans, Democrats and Independents alike are strongly opposed. In contrast, 69 percent of voters surveyed favor Congress passing a bill to give the FDA authority to regulate tobacco products. The message to Congress is clear: good public health policies on tobacco also happen to be good politics.

 

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