Where's There's Smoke... Someone's Getting Burned

 

OK, so the big tobacco companies and their lobbyists have cobbled together a backroom deal to save their hides. And now the various state Attorneys General can return to their respective capitals and grandstand the agreement triumphantly.

Neville Chamberlain did the same thing once. Didn’t help.

Yeah, the bad guys have to pour out $368 billion, and they give up billboards, vending machines, Joe Camel, and the Marlboro Man. Cigarette packs will now have scarier warning labels, smoking will be banned from many public places, and manufacturers will fund teen anti-smoking programs.

The headlines sound great, right? Read the fine print.

• Annual tobacco-associated health costs are about $100 billion, but the companies will only be paying about $15 billion a year. We’re settling for 15 cents on the dollar.
• In exchange for the pay out, class action suits will be abolished and individuals will be forbidden from seeking punitive damages. (That’s arguably a violation of the Seventh Amendment guarantee of due process, but nobody cares.) The best you might do is sue for actual losses, minus legal fees. Almost no one will and the bad guys know that. The days of tobacco liability lawsuits are essentially over.
• The tobacco companies won’t pay the settlement; consumers will. The cost of cigarettes will rise to cover the expense. They’ll lose a few smokers, but the loss will be covered by decreased marketing expenses as a result of the new restrictions. End of story.
• Philip Morris, RJR, and the rest are sprawling multinationals with major cash flow outside of cigarettes. Some stock brokers consider RJR’s Nabisco Foods division alone worth more than the parent corporation’s total market cap. Once potential liability suits are removed from the equation, several tobacco analysts anticipate Philip Morris and RJR stocks will rise, possibly as high as 30 percent in the next year. On Wall Street, crime pays. The deal requires companies to pay penalties of up to $2 billion if teen smoking isn’t curbed. So what? That’s loose change to these guys—actually less than the income from addicting new smokers. If the bad guys demonstrate that they took "reasonably available measures," an appeal process already codified puts $1.5 billion back in their pockets.
• A federal court has already ruled that the FDA can regulate nicotine as a drug. This agreement reinforces that, right? Wrong. Actually, the new deal forces the FDA to demonstrate that decreasing nicotine levels won’t create "significant demand for contraband." The FDA has no way to do that. So the new agreement actually obliterates the earlier court ruling and prevents the FDA from regulating nicotine. All five of the majors already make most of their tobacco money overseas, so they’ll just accelerate their marketing into developing countries. By protecting the tobacco industry’s profits here, the deal guarantees millions of future tobacco deaths in the Third World.
• The GATT agreement gives the multinational tobacco firms the right to sue the U.S. government by calling any new regulations in the agreement they don’t like "unfair impediments to trade." Which means that the few useful legal restrictions in the deal probably won’t stick for long.

All isn’t lost, however.

The deal is really just a rough draft, because liability limitations must be passed into law by Congress. Significant public outcry can still stub out the deal.

Rest assured, however, that Speaker Newt will twist arms until they break trying to get this thing passed. Why? For one, the two leading soft money contributors to the GOP were—guess who—Philip Morris and R.J. Reynolds.

For two, as this space also outlined two months back, the $300,000 bribe—er, loan, sorry—that former presidential candidate and current tobacco flack Bob Dole fronted Gingrich last April corresponds with a $300,000 payment from Dole’s employer, tobacco lobbyist Verner Liipfert, just six days earlier. The fix is in. It’s a major scandal in the works that the corporate media has so far ignored.

What’s the alternative? Simple: no deal. Let the existing suits go forward. Let discovery proceed. Let justice be done.

 

Forehead Branding

Ever since the Supreme Court ruled that private campaign financing is protected by the First Amendment, rich corporate donors have been guaranteed unfair influence.

The limited reforms available can’t solve the problem entirely, although current proposals to abolish soft money donations to political parties would be a good start.

In the meantime, however, our only hope is to devise a system that keeps voters fully informed of exactly who is financing each candidate, a method that is undeniable, visual, and permanent.

My suggestion? Forehead Branding. All candidates for public office who accept corporate money should have the company logos of their sponsors burned directly onto their heads, so voters will never forget or confuse their allegiances.

The corporations won’t mind; they’ll be glad for the extra advertising. Since any candidate who won’t surrender the ad space will be replaced by someone who will, politicians will rush to support the measure as well.

The measure would transform American politics instantly. Imagine Bob Dole playing tough on drugs with a big red Marlboro logo right between his eyes, or Newt Gingrich blustering about Family and Flag with Rupert Murdoch’s signature straddling his eyebrows.

How long would liberal faith in Clinton last if he had Goldman Sachs imprinted at the hairline, a Seagrams bottle painted on his lips, and Mickey Mouse ears implanted in his nose?

The free market may finally solve something after all.

 

Budget Busting

The Republican Congress and the Democratic President are all bragging about the new budget, which supposedly balances five years from now. As we should know by now, anything that Clinton and Gingrich both agree on has got to be a bad idea.

The budget balances in 2002, but only if all their estimates are right on target and nothing important changes between now and then. Is the future that easy to predict? Sure, as anyone who bought a Commodore 64 can tell you.

We’ve seen this game before. Last decade, Congress passed a law intended to balance the budget through mandated spending limits. Grab-Rodman-Hollering, it was called, or something like that. Did it accomplish anything? No. By pushing the actual date of balance well into the future, one group of pols took credit for something they were actually asking a later group to do. The media applauded, and nothing happened.

By 2002, most of the current crew will be off collecting fat paychecks for attending board meetings and lobbying the new guys. So if the budget doesn’t balance, they won’t take the heat.

Even if it does, nonpartisan estimates show that from 2003 on, the deficit will increase again rapidly. So what’s the point? The whole thing’s a bigger spin job than Twister.

Fact is, balancing the budget isn’t that urgent a deal. Today’s deficit is less than a quarter of what it was back in the Reagan years, and as a percent of GDP, it’s way smaller than the deficits of most industrialized nations.

The phony rush to balance is really just a fig leaf to cover some pretty skanky priorities.

There are tax cuts in the budget. But non-partisan figures say that 98 percent of the inheritance and capital gains cuts go to the richest 5 percent of us. As usual. The IRA tax break goes to the richest 20 percent. The two tax cuts which go to the middle class aren’t indexed to inflation, so they’ll quietly disappear before long.

As promised, there are also spending cuts: $14 billion from Medicaid (while last year Congress gave the military $12 billion it didn’t even ask for), and over $100 billion from Medicare. Tobacco subsidies and gold-plated stealth bidets in the Pentagon privies remain untouched.

This budget is about as sensibly balanced as Boris Yeltsin on roller skates in an aftershock. They shouldn’t get away with this.

 

Donations

The House Government Reform and Oversight Committee is investigating the thousands of dollars in Asian contributions to the White House. Never mind the millions that Ferdinand Marcos, the dictator of the Philippines, poured into recent GOP administrations.

It turns out, that the guy spearheading the Clinton investigation has some explaining to do as well. Rep. Dan Burton of Indiana has accepted thousands of dollars from foreign lobbyists, and subsequently given those donors access to his office and staff to promote their causes.

Burton’s friends don’t play nice. We’re talking brutal dictatorships and police states—Turkey, Pakistan, Guatemala, Zaire, and apartheid South Africa—using him to buy access to the floor of Congress.

For example, when Turkey’s terrible human rights record (think Midnight Express and the war against the Kurds) posed a threat to its U.S. aid money, Burton recited the Turkish lobbyist’s rebuttal into the record as his own words.

Burton has also spouted propaganda straight from Pakistani flacks, defended the death squad dictatorship of Guatemala, and shared speechwriters with Joseph Mobutu, the deposed dictator who stole $5 billion from what used to be Zaire.

In his defense, the Congressman’s spinmeisters claim that none of the money from Mobutu or the guys who imprisoned Mandela had any effect on his policies, that Burton was always acting his conscience.

Do these guys realize what they’re saying? That Dan Burton has a moral need to defend murderers, thieves, and racists?

 

 

The Forbes Family Friendly Workplace

The Senate is toying around with an idea called the Family Friendly Workplace Act. Sounds festive, doesn’t it? You picture balloons and happy music—sort of an IBM meets Chuck-E-Cheese kind of vibe.

But then, they’re proposing a federal law, so it’s probably more serious than that. Probably.

OK. Maybe it’s about tax credits for day care, or parental leave in the first weeks after birth. Family Friendly, right? Nope. In the guise of providing workers with more flexible hours, the bill permits employers to pay time-and-a-half for overtime in what’s called "comp time." That means if you work ten hours of overtime this week, you get paid for ten hours at your regular rate, with no extra money for the extra work. What you do get is credit later for five extra hours worked some other week.

Sounds okay so far. But unlike real overtime, the extra hours don’t count toward benefits, and you don’t get to choose when the "comp time" gets credited. Your boss does. So the flexibility isn’t for you and your family at all.

What this bill means is you can be worked 70 hours a week when things get busy, and given your "comp time" when things get slow.

Now that the social safety net has been shredded, this bill marks the beginning of an assault on the 40-hour work week.

 

Justice?

Should the government be able to confiscate your money, even if they admit you haven’t done anything wrong? The answer, according to the Justice Department, is yes. Three years ago, a Los Angeles businessperson who owns a couple of gas stations boarded a plane to visit his birthplace in the Middle East. He had with him over $350,000 in cash, which border patrol dogs sniffed out.

The security folks presumed he was some Trainspotting heroin mule, and so they nabbed the guy and the cash. However, it turned out he was clean, and so was the money. The guy was simply going to repay the folks back home who gave him the business loan that got him started. So the Feds let him go. But they kept the cash. How can they do that? Good question.

The Justice Department says that since there’s a limit on how much currency you can take across a U.S. border, then anyone over the limit automatically loses everything. Even if they haven’t committed a crime.

Two federal courts have already ruled that the Justice Department is nuts and has to give back the cash. The Supremes have the final say. Let’s hope they force the Justice Department to live up to its name.