Wanted: Tobacco Mea Culpa Admit That You Lied To Congress, Senators Tell Cigarette Executives
If some senators have their way, one price for approval of the landmark $368.5 billion tobacco settlement will be that tobacco executives say publicly they lied to Congress three years ago by denying that they knew nicotine is addictive.
“We need an acknowledgment that you are such crumbs in the way in which you’ve dealt with the American public. It really is despicable,” Sen. Joseph Biden, D-Del., told a tobacco industry representative Thursday at the first congressional hearing on the proposed settlement.
With varying degrees of hostility, members of the Senate Judiciary Committee grilled key players in the deal reached last Friday between tobacco companies and the 40 states suing them to collect tobacco-related health costs related to sick smokers.
Senators questioned numerous details of the 68-page pact but reserved special scorn for past actions by the tobacco industry. The day three years ago when seven tobacco executives denied under oath knowing nicotine was addictive seemed to especially rankle committee members.
If tobacco company executives don’t acknowledge the addictive nature of their products, Biden said, “this settlement goes down the tubes.”
He added: “Time is not on your side. We’ll probably put you out of business - at least we’ll drive you offshore with the cocaine dealers.”
“We are completely sincere” in wanting to resolve 40 years of “fighting everyone everywhere over everything,” said Meyer Koplow, who represented Philip Morris at the settlement negotiations.
Calling herself a “reformed smoker,” Sen. Dianne Feinstein, D-Calif., said that while she has no respect for tobacco companies, she thinks the settlement is “historic, impressive and important.”
Mississippi is due to go to trial against the tobacco companies on July 7 and Florida on Aug. 4. But Mississippi Attorney General Michael Moore said the Florida litigation is uncertain after a judge there on Thursday barred the state from seeking to collect $16 billion in future anticipated damages.
Moore told senators that even if the attorneys general “win all of our cases, we will never get what we have (in the agreement) before you today.”
Matthew Myers, executive vice president of the National Center for Tobacco-Free Kids, said, “This opportunity will occur only once in a lifetime. We need to seize it and get it right.”
Myers noted that the tobacco industry would be required to pay $300 million to the Food and Drug Administration for overseeing the settlement. He contrasted that with the $15 million a House appropriations committee approved Wednesday for the FDA to use to crack down on illegal tobacco sales to minors. The FDA had requested $34 million.
Sen. Charles Grassley, R-Iowa, questioned the tax deductibility of tobacco industry payments into a settlement fund. “This agreement would give the industry a $129 billion break over 25 years,” he said.
Koplow responded that coming up with a $10 billion down payment “would be impossible for some companies if it were not deductible.”
On allowing the industry to deduct as business costs the $60 billion in punitive damages, Moore added, “This money wouldn’t be there were it not for the settlement.”