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The Ultimate Hypocrisy — Government Profiting on Killer Tobacco

Posted Nov 30 2012 1:03pm

Bob’s Newheart and our Facebook group Organ Transplant Initiative (OTI) support and encourage organ donation and potential biological and mechanical alternatives we also believe that the best solution for the organ shortage is to reduce the demand.

Tobacco products along with alcohol are two of the greatest contributors to organ damage and the need for transplants.  If we could get people to stop using those substances the demand for transplants would diminish significantly and that could mean that the supply of organs just might catch up to the reduced demand.

The affect of tobacco products on human organs is devastating.  There is almost no part of our bodies that the thousands of chemicals in tobacco and cigarette smoke can’t invade and ultimately destroy.  If you smoke, it likely will kill you!  If you quit your body will begin to recover and the cancers and other diseases will have to find a different host.

Our governments (city, county, state and federal) all tax tobacco often with the intention of using the revenue to finance stop smoking campaigns and most often some of the money collected is used for that purpose but not always.  As is usually the case when there is a pot of money available, lots of good causes want some of it, sometimes not so good causes get it so less than 3% of tobacco tax dollars go into anti smoking or smoking cessation programs.  Furthermore, settlements in and out of court in the 1990s mean that the tobacco industry is paying states nearly $250 billion over 25 years. Under the agreement, those payments to states will continue flowing even beyond 25 years as long as the tobacco industry is healthy. But the payments would phase out as cigarette company profits decline and would ultimately disappear if people stop smoking.  So while government must try to get people to quit smoking, they really don’t want to try too hard.

So, having given you some critical information about smoking  I’m hoping you will do two things,  1) if you smoke…quit.  2) tell your elected officials to get really serious about helping people who use tobacco products to quit using them, I submit this post for your consideration and comment.

There’s an adage that goes, ”If you borrow a hundred dollars from the bank, you owe the bank.  If you borrow a million you own the bank.”  That simply means the bank can’t be too hard on you if they want to get their money back.  That’s the situation governments find themselves in with tobacco.  In a strange twist, tobacco companies own the government.  Let me explain.

Tobacco Kills.  Cigarettes alone kill nearly a half million Americans every year.  That’s just a cold hard fact.  You probably don’t need reminding but I will anyway via the enters for Disease Control in Atlanta, Georgia.  They list these facts: http://tinyurl.com/lblldw

  • The adverse health effects from cigarette smoking account for an estimated 443,000 deaths, or nearly one of every five deaths, each year in the United States.
  • More deaths are caused each year by tobacco use than by all deaths from human immunodeficiency virus (HIV), illegal drug use, alcohol use, motor vehicle injuries, suicides, and murders combined.
  • Smoking causes an estimated 90% of all lung cancer deaths in men and 80% of all lung cancer deaths in women.
  • An estimated 90% of all deaths from chronic obstructive lung disease are caused by smoking.

Smoking and Increased Health Risks

Compared with nonsmokers, smoking is estimated to increase the risk of—

  • coronary heart disease by 2 to 4 times,
  • stroke by 2 to 4 times,
  • men developing lung cancer by 23 times,
  • women developing lung cancer by 13 times, and
  • dying from chronic obstructive lung diseases (such as chronic bronchitis and emphysema) by 12 to 13 times.

If trends continue, one billion people will die from tobacco use and exposure during the 21st century – one person every six seconds. Globally, tobacco-related deaths have nearly tripled in the past decade, and tobacco is responsible for more than 15% of all male deaths and 7% of female deaths. Tobacco is also a risk factor for the four leading noncommunicable diseases (NCDs) – cancer, heart disease, diabetes and chronic respiratory diseases – which account for more than 63% of global deaths according to the World Health Organization.

Tobacco use is the number one killer in China, causing 1.2 million deaths annually; this is expected to rise to 3.5 million deaths annually by the year 2030. Tobacco is also responsible for the greatest proportion of male deaths in Turkey (38%) and Kazakhstan (35%), and the greatest proportion of female deaths in the Maldives (25%) and the United States (23%).

Uniquely among cancer-causing agents, however, tobacco is a man-made problem that is completely preventable through proven public policies. Effective measures include tobacco taxes, advertising bans, smoke-free public places, mass media campaigns and effective health warnings. These cost-effective policies are among those included in the World Health Organization’s Framework Convention on Tobacco Control (WHO FCTC), a global treaty endorsed by more than 174 countries, and recommended by the World Health Organization in its MPOWER policy package.  http://tinyurl.com/bor7897

Our government knows all of this.  All of our elected officials know this and they all publicly support anti-smoking efforts.  They go to great extremes to condemn the use of tobacco while explaining the public health consequences.   Almost no one is pro smoking and yet everyone is pro smoking because we have come to depend on the billions of tax dollars generated by the sale of tobacco products.  It should be pointed out that at least the U.S,. Government no longer subsidizes tobacco farmers.  That program ended several years ago.

As usual the poor are hit the hardest by the addictive nature of tobacco.  In a study conducted on behalf of the New York State Department of Health , it revealed that low-income smokers (those in households making under $30,000), spent an average of 23.6% of their annual household income on cigarettes, compared to 2.2% for smokers in households making over $60,000.

Taxes on tobacco products total billions of dollars a year.  An example — in New York state the federal tax on a package of 20 cigarettes is $1.01, the state tax is $4.35. New York City adds a local tax of $1.50 to the state levy. That brings the combined tax rate on a package of 20 cigarettes in New York City to $6.36.  Tobacco manufacturers add their profit on top of that so depending on where you buy your cigarettes in the city you could pay as much as $12 a pack…twelve dollars for a pack of cigarettes.  By comparison, when I started smoking in 1954 you could buy a pack of “Wings” cigarettes for Ten cents. Major brands like Lucky Strikes or Camels were a quarter (quit smoking in 1991).

Tobacco Industry Profits Greater Than Ever
According to The Tobacco Atlas, estimates of revenues from the global tobacco industry likely approach a half trillion U.S. dollars annually. In 2010, the combined profits of the six leading tobacco companies was U.S. $35.1 billion, equal to the combined profits of Coca-Cola, Microsoft, and McDonald’s in the same year. If Big Tobacco were a country, it would have a gross domestic product (GDP) of countries like Poland, Saudi Arabia, Sweden and Venezuela.

In the meantime, tobacco companies are fighting laws with every weapon in their arsenal because just as their product kills people, restrictive smoking laws can kill the industry, a killing some say, is necessary and justified homicide.

As countries around the world ramp up their campaigns against smoking with tough restrictions on tobacco advertising, the industry is fighting back by invoking international trade agreements to thwart the most stringent rules.

A key battlefront is Australia, which is trying to repel a legal assault on its groundbreaking law requiring cigarettes to be sold in plain packs without distinctive brand logos or colors. Contesting the law, which takes effect Dec. 1, are the top multinational cigarette makers and three countries — Ukraine, Honduras and Dominican Republic — whose legal fees are being paid by the industry.   http://tinyurl.com/chypao4

Tobacco use has diminished considerably in most of the developed countries but not all of them.  The leafy crop is gaining new popularity among U.S. farmers. Cheaper U.S. tobacco has become competitive as an export, and China, Russia and Mexico, where cigarette sales continue to grow, are eager to buy. Since 2005, U.S. tobacco acreage has risen 20 percent. Fields are now filled with it in places like southern Illinois, which hasn’t grown any substantial amounts since the end of World War I.   http://www.freerepublic.com/focus/f-news/1899911/posts

While the price of cigarettes has continuously increased since 1965, the percentage of that price going towards taxes is now half of what it was then. ]While tobacco companies complain about the $1.01 cigarette tax, Phillip Morris , Reynolds American , and Lorillard have all increased their prices by almost $1.00 per pack on their own. Phillip Morris currently lists all taxes, including federal, state, local, and sales taxes, as 56.6% of the total cost of a pack of cigarettes.

One of the reasons for the support of increased cigarette taxes among public health officials is that many studies show that this leads to a decrease in smoking rates . The relationship between smoking rates and cigarette taxes is in fact very elastic ; the greater the amount of the tax increase, the greater the proportion of smokers who stop smoking. This is especially prevalent amongst teenagers. For every ten percent increase in the price of a pack of cigarettes, youth smoking rates overall drop about seven percent. This rate is also true amongst minorities and low income population smokers.  The rates of calls to quitting hot-lines are directly related to cigarette tax hikes. When Wisconsin raised its state cigarette tax to $1.00 per pack, the hot-line received a record of 20,000 calls in a two month time period versus its typical 9,000 calls annually.

According to the New York Times taxes are not the only government revenue from cigarettes. Settlements in the late 1990s to end state lawsuits against tobacco companies mean that the cigarette industry is paying states nearly $250 billion over 25 years. Under the agreement, those payments to states will continue flowing even beyond 25 years as long as the tobacco industry is healthy. But the payments would phase out as cigarette company profits decline and would ultimately disappear if people stop smoking.

So the government has become a financial stakeholder in smoking, some would argue, even as public health officials warn people about its deadly consequences. Smoking declines as cigarette taxes increase, but a core group of smokers hang on to the habit.   http://www.nytimes.com/2008/08/31/weekinreview/31saul.html

Will the government or governments ever really crack down on smoking?  Doubtful, there is too much money in it for them so the tobacco companies and the politicians who seek to eradicate them have come to be bedfellows.  What many politicians fail to see is the savings that could be had if people didn’t smoke.  According to the CDC again, “Smoking is also a major contributor to many chronic diseases that are driving up the nation’s health care costs. Each year, diseases caused by cigarette smoking result in $96 billion in health care costs, much of which is paid by taxpayers through publicly-funded health programs.” http://www.cdc.gov/features/TobaccoControlData/ but the savings go beyond that when you consider the costs to employers and employees in higher premiums and lost work time due to tobacco caused illnesses.

If we truly wanted to wipe out smoking, taxes could be raised even higher than they are and the dollars generated could go a long way toward helping to solve our budget problems.  Unfortunately if everyone quit smoking, the tax revenue would disappear, too and therein lies the dilemma, but it does prove that you can be both for and against something at the same time.


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