Tobacco Settlement: A Pack a Day to Keep the Bill Collector Away

As the first payments from the $206 billion tobacco settlement are delivered to state governments, it looks like the money will not be used where it could do the most good: to help people who want to quit using tobacco.

State governments for the most part are planning to use the money on pork projects or tax reductions. Only eight states out of the 46 who sued are planning comprehensive smoker education programs, and these programs are aimed more at preventing smoking than helping those already hooked to quit.

There are two reasons why tobacco users are getting no help. First, the states sued the tobacco companies to recover costs from treating tobacco-related illnesses and to punish the companies for years of deceptive tactics. The settlement never really was about the people harmed. The second reason is because people have to keep buying tobacco for the companies to continue paying the settlement.

That’s right, helping people quit smoking means less money for the states. If tobacco sales decline so do the payments. John and Joan Q. Smoker have to keep puffing so state politicians can keep porking.

Advances in treating nicotine addiction could help many people break the habit. One hindrance is the expense. A month on the patch costs more than $100 on average. A prescription like Zyban costs about $120 a month plus a visit to a doctor. It costs more to quit than to smoke for some people in the short run.

State governments could easily subsidize the cost of nicotine treatment with the billions they’re getting from tobacco companies. In the long run helping people quit would save some of the costs of treating tobacco-related illnesses. And with fewer people using tobacco, tobacco companies would slowly be forced out of business.

Sounds like the best punishment to me.

Don’t expect politicians to see past the dollar signs though. Not only would settlement payments be reduced with cigarette users, so would state taxes from the sale of tobacco. A pack of cigarettes costs about a quarter to produce. By the time the cigarettes are sold the cost is about $3 in Ohio, with a majority of the difference going to taxes.

The attorneys general who sued the tobacco companies drummed up public support by promising that a large portion of any settlement would go towards smoking-related programs, but as the money rolls in only eight percent of the first payments have been budgeted for anti-smoking efforts. Turn the card over and it’s not the queen of hearts, it’s the ace of spades, and guess who collects the pot?