Why Anti-Smoking Legislation Will Succeed While Health Care Reform is in Danger

June 15, 2009 at 9:09 pm

This past week the Senate passed an anti-smoking bill that will give regulators new powers in the fight against smoking.

On the surface, passage of this bill seems like a liberal victory. Until you look closer.

Philip Morris (now Altria) has come out in favor of the bill. Now why would Altria support legislation to regulate the tobacco industry unless it somehow benefited them?

Here’s how it benefits them:

  • Many advertising venues and marketing practices are banned – This effectively locks in Marlboro’s 50% share of the market
  • Costs of compliance favor large manufacturers over small – Again, a boost to Altria
  • And, if the FDA approves some cigarettes as “safer,” Altria may benefit first as they have the biggest research pockets

So basically Altria is rolling the dice. They figure they may be better off trying to work with the government than against them. In 1998, the company spent $100 million fighting FDA regulation when John McCain introduced it. This time, they figure that they can come through this legislation in better shape than their competitors.

Now in addition to consumer groups like the American Lung Association, the other huge lobbying force in the fight to regulate cigarettes is health insurers.

Health insurers and the other groups that support the bill say that it can significantly reduce the 400,000 deaths and $100 billion in healthcare costs attributed every year to smoking.

Personally, I believe this bill will help reduce smoking among young people because of the bans on advertising and the ability to place limits on nicotine levels. However, the reason this bill will pass with such broad support is because of the backing of companies like Altria and the health insurance industry.

What is most interesting is that the usual conservative argument of “less government” takes a backseat when the big corporate lobbies get behind the legislation. You will still hear the occasional gripe against regulation, but it won’t be amplified the way it would if these corporations opposed the legislation.

Now consider health care.

Who is for it?

  • The uninsured
  • Americans frustrated with the failure of the current system
  • Small business owners (not all, but I think many favor reform to clamp down on the cost of health insurance)

Who is against it?

  • The American Medical Association (representing 1/3 of US doctors) because they fear it will cut what they can charge (though the AMA in the past has pushed for a form of universal coverage)
  • The health insurance lobby (that fears competing with a government sponsored plan or any form of regulation)
  • The U.S. Chamber of Commerce (representing more than 3 million businesses)

With these large business groups opposing any type of reform because it will cut into their profits, you can bank that we are going to hear the following ad nauseum about any attempts to reform the health care system:

  • It’s socialized medicine
  • The government limits flexibility and innovation
  • We need market-driven reform
  • The private sector can do better than government

Again, setting aside for a moment a discussion of the argument itself, it’s just interesting to look at how and when it is used.

Any of these arguments could be used to fight anti-smoking legislation. But you won’t hear it. At least not as much.

Where you will hear these arguments is to fight any form of health care reform. Even though with escalating costs and 50 million uninsured, some type of reform seems badly needed.

Let’s hope, like the Chamber of Commerce hopes, that some type of compromise can be worked out this year that will move the health care industry in the right direction.