FOCUS ON THE CORPORATION: 10 MARCH 1998

Truly Retiring the Marlboro Man/h2>


Imagine you were Geoffrey Bible, CEO of Philip Morris. You would have two overriding goals: First, to limit your liability from lawsuits in the United States. Second, to make sure nothing interfered with your plans to expand massively abroad.
In the deal the tobacco industry concluded with 40 state attorneys general last June, Bible and the other tobacco executives achieved both of these aims. The deal gave the industry effective immunity from lawsuits, by precluding class action lawsuits, preventing punitive damage awards to those who sue the industry and setting an annual cap that would assure the industry was required to pay no more than $5 billion a year to victims who successfully sued the tobacco companies. And it did absolutely nothing to curb Big Tobacco's overseas expansion.
The exclusion of international issues from the deal was not a simple oversight. When some of the attorney general negotiators raised it, Big Tobacco dismissed it out of hand. In the face of industry obstinacy, the attorneys general quickly capitulated.
In fact, the June deal would actually make matters worse internationally. The deal specifically denied the Food and Drug Administration authority to regulate tobacco exports. It stated that, in the event of bankruptcy, the tobacco companies would be able to segment profits from overseas sales from their domestic bankruptcy payment obligations. And it denied foreign victims of the U.S. tobacco companies their limited right of access to U.S. courts. Unfortunately, many of these flaws have been replicated in several of the pending tobacco bills under congressional consideration.
What happens to the Tobacco Lords' foreign operations is of tremendous importance both to the health of the tobacco companies and, more importantly, to the health of millions of people around the world. Philip Morris and R.J. Reynolds sell approximately two-thirds of their cigarettes overseas, and make nearly half their profits on foreign sales. These sales do not just displace other companies sales. U.S. tobacco companies' marketing strategies create more smokers. After South Korea opened its market to U.S. companies in 1988, for example, smoking rates among male Korean teens rose from 18.4 percent to 29.8 percent in a single year. The rate among female teens more than quintupled, from 1.6 percent to 8.7 percent. With smoking rates rising in the Third World due to rising incomes, corporate tobacco pushing and other causes, the World Health Organization predicts tobacco-related deaths worldwide will rise from 3 million to 10 million by the 2020s, with 70 percent of those fatalities in the developing world. There is, however, reason to be hopeful that Geoffrey Bible and his associates will not succeed in their scheme to protect industry profits and continue uninhibited addicting millions around the globe. Even as prospects for tobacco company special protections are fading on Capitol Hill, a group of legislators have crafted an international tobacco control package that would begin to address Big Tobacco's international misconduct.
In late February, Senators Richard Durbin, D-Illinois, Frank Lautenberg, D-New Jersey, Paul Wellstone, D-Minnesota, and Ron Wyden, D-Oregon, joined with Representatives Lloyd Doggett, D-Texas, and Frank Pallone, D-New Jersey, to announce a legislative initiative that would require U.S. tobacco companies to adhere to at least as stringent marketing and labeling standards overseas as domestically.
Other provisions of the package would: prohibit the U.S. government from promoting U.S. tobacco interests in foreign markets; impose tough anti-smuggling provisions on tobacco products; and support governmental and non-governmental tobacco control efforts, including television counteradvertisements urging people not to smoke, in developing countries and in Eastern Europe and the former Soviet Union. Some Republican support for at least portions of the package is expected to be forthcoming.
Imagine that instead of Geoffrey Bible, you were a parent of a 15-year-old in Beijing or Seoul, in Nairobi or Sao Paulo, in Moscow or Kiev. In recent years, the U.S. tobacco companies have begun introducing a host of slick marketing techniques -- free cigarette giveaways, sponsorships of rock concerts and sports events, discotheque dance nights, promotional t-shirts, hats and other attire, and many others -- that make smoking seem cool, hip, sophisticated and very, very American. Smoking rates among teens are rising. Wouldn't you hope that the U.S. government would at least ensure that U.S. tobacco companies not expose your child to deceptive marketing strategies that are outlawed or about to be banned in the United States?


Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter.
Robert Weissman is editor of the Washington, D.C.-based
Multinational Monitor.

COPYRIGHT © RUSSELL MOKHIBER AND ROBERT WEISSMAN
"Focus on the Corporation" is a weekly column written by Russell Mokhiber and Robert Weissman. Please feel free to forward the column to friends or repost the column on other lists. If you would like to post the column on a web site or publish it in print format, we ask that you first contact us (russell@essential.org or rob@essential.org).
"Focus on the Corporation" is distributed to individuals via email. To subscribe, send an e-mail message to list-proc@essential.org with the following all in one line: subscribe corp-focus <your name> (no period).