Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Congress Holds Hearing on Buy-Out of Federal Tobacco Program
Newsstream.com ^ | 27 September 2002

Posted on 09/27/2002 6:40:06 AM PDT by SheLion

STORY SUMMARY: Congress is holding hearings on proposals that for the first time would buy-out the Federal Tobacco Program. Tobacco manufacturers would pay for the multi-billion dollar buy-out legislation.

One proposal, the McIntyre-Davis Bill, would eliminate the tobacco quota system and establish an open marketplace. The bill also includes FDA regulation of tobacco products.

The following sound bites are available from Mike Szymanzcyk, chairman and CEO Philip Morris USA.

(Szymanzcyk) The convergence of Federal Legislation and the tobacco quota buyout presents an opportunity for us to work together to insure that these complimentary goals are joined to fashion a comprehensive, thoughtful, and effective national tobacco policy (:15)

(Szymanzcyk) Representatives McIntyre and Davis have proposed a quota buyout that is truly a buyout, not merely a subsidy posing as a buyout. Alternative proposals that would purport to eliminate the existing quota and price control system only to replace them with new ones, are simply not reasonable, equitable or achievable. (:20) ---------------

Produced for Philip Morris U.S.A.

Contact:

Emily Lloyd, 212-980-9090


TOPICS: Activism/Chapters; Culture/Society; Government
KEYWORDS: antismokers; butts; buyout; cigarettes; government; individualliberty; niconazis; phillipmorris; prohibitionists; pufflist; smokingbans; taxes; tobacco
Navigation: use the links below to view more comments.
first 1-2021-29 next last
The bill also includes FDA regulation of tobacco products.

What I can't understand is: why would the tobacco company's agree to the FDA regulation? Why would they "buy-out" just to contribute to their demise?

Thoughts?

1 posted on 09/27/2002 6:40:07 AM PDT by SheLion
[ Post Reply | Private Reply | View Replies]

To: *puff_list; Just another Joe; Great Dane; Max McGarrity; Tumbleweed_Connection; maxwell; ...
PUFF
2 posted on 09/27/2002 6:41:18 AM PDT by SheLion
[ Post Reply | Private Reply | To 1 | View Replies]

To: SheLion
I've never understood any of it myself either.
3 posted on 09/27/2002 6:46:59 AM PDT by Gabz
[ Post Reply | Private Reply | To 1 | View Replies]

To: Gabz
I've never understood any of it myself either.

I just can't figure out why they would buy-out, while letting the FDA regulate. If the FDA regulates, we all know where THAT will go!

4 posted on 09/27/2002 6:49:05 AM PDT by SheLion
[ Post Reply | Private Reply | To 3 | View Replies]

To: SheLion
You misunderstand the buyout. It is not the cigarette companies like Philip Morris which are being "bought out," it is the individual tobacco farmer. Right now, Farmer Brown has a tobacco quota (this program has been in effect since 1938), and he is guaranteed a certain minimum price for his tobacco in exchange for selling up to his quota amount.

The buyout program would compensate Farmer Brown for the economic value of his quota (quotas can be sold or leased by one tobacco farmer to another); in exchange, Farmer Brown can now grow and sell as much tobacco as he wants, however, the USDA will no longer guarantee a minimum price.

And that, folks, is why Philip Morris and the other cigarette companies support this buyout program. Whereas before they had to offer Farmer Brown at least the minimum price guaranteed by the USDA, they will not be in the position of telling Farmer Brown, "Here's what we'll pay you for your tobacco -- take it or leave it."

Farmer Brown will take what he can get, the cigarette companies will get their tobacco for less money, and cigarettes will fall in price.

As for the FDA regulation of tobacco products, it's a small price for the cigarette companies to pay in exchange for lower tobacco prices, and besides, it will serve to inoculate the cigarette companies against future lawsuits brought by plaintiffs who charge that cigarettes are more harmful than the companies let on.
5 posted on 09/27/2002 7:20:08 AM PDT by mg39
[ Post Reply | Private Reply | To 4 | View Replies]

To: All
Doh! Made a small but significant spelling error. When I wrote, Whereas before they had to offer Farmer Brown at least the minimum price guaranteed by the USDA, they will not be in the position of telling Farmer Brown, "Here's what we'll pay you for your tobacco -- take it or leave it." The "not" should read "now." Sorry about the confusion.
6 posted on 09/27/2002 7:23:49 AM PDT by mg39
[ Post Reply | Private Reply | To 5 | View Replies]

To: mg39
As for the FDA regulation of tobacco products, it's a small price for the cigarette companies to pay in exchange for lower tobacco prices, and besides, it will serve to inoculate the cigarette companies against future lawsuits brought by plaintiffs who charge that cigarettes are more harmful than the companies let on.

We all know that if cigarettes are put under the control of the FDA, they would not put their seal of approval on them. Therefore, they would have to ban cigarettes.

7 posted on 09/27/2002 7:44:47 AM PDT by SheLion
[ Post Reply | Private Reply | To 5 | View Replies]

To: mg39
I appreciate your xplanation - I've always had a general idea but have never had it spelled out in such laymen terms. I also agree with everything you say with one exception:

Farmer Brown will take what he can get, the cigarette companies will get their tobacco for less money, and cigarettes will fall in price.

That will NEVER happen.

8 posted on 09/27/2002 7:51:35 AM PDT by Gabz
[ Post Reply | Private Reply | To 5 | View Replies]

To: SheLion
Perhaps, but I tend to think that won't happen. More likely, the cig companies will be forced to list all of their ingredients, and there may be stricter controls on sales to minors. Bear in mind that Jesse Helms is a major supporter of this buyout legislation, and he of all people would never agree to legislation which would lead to the outlawing of cigarettes.
9 posted on 09/27/2002 7:54:33 AM PDT by mg39
[ Post Reply | Private Reply | To 7 | View Replies]

To: Gabz
I wrote: "Farmer Brown will take what he can get, the cigarette companies will get their tobacco for less money, and cigarettes will fall in price."

Regarding falling cigarette prices, you responded, "That will NEVER happen."

You mean you don't trust the cigarette companies to pass along the savings? :)
10 posted on 09/27/2002 7:56:19 AM PDT by mg39
[ Post Reply | Private Reply | To 8 | View Replies]

To: mg39
You mean you don't trust the cigarette companies to pass along the savings? :)

LOL!!! what would ever give you that idea???? ;)

11 posted on 09/27/2002 8:00:15 AM PDT by Gabz
[ Post Reply | Private Reply | To 10 | View Replies]

To: mg39
there may be stricter controls on sales to minors

There always has been a law to when someone could buy cigarettes. In Ohio, it was 18. Maine, the same.

And any store that sells cigarettes to minors deserve all they get! How stupid can anyone be to sell to minors?

Also, a lot of parents buy cigarettes for their underage teens, and this is no one's business.

12 posted on 09/27/2002 8:25:32 AM PDT by SheLion
[ Post Reply | Private Reply | To 9 | View Replies]

To: mg39
You mean you don't trust the cigarette companies to pass along the savings? :)

What savings? It's the TAXES that are forcing people to purchase cigarettes elsewhere. It's the TAXES that are outrageous.

13 posted on 09/27/2002 8:27:28 AM PDT by SheLion
[ Post Reply | Private Reply | To 10 | View Replies]

To: mg39
#5....... Now it makes sense, thank you.
14 posted on 09/27/2002 8:34:57 AM PDT by Great Dane
[ Post Reply | Private Reply | To 5 | View Replies]

To: SheLion
What savings? It's the TAXES that are forcing people to purchase cigarettes elsewhere. It's the TAXES that are outrageous. Taxes are a separate issue. There would obviously be savings to cigarette companies if it cost them less to aquire the tobacco they use in their cigarettes. It is this saving in cost which Philip Morris, et al, could in theory pass along to their customers. Again, that is a separate issue from taxes. By the way, the tax issue is yet another reason you have little to fear in the way of FDA banning cigarettes.
15 posted on 09/27/2002 8:35:38 AM PDT by mg39
[ Post Reply | Private Reply | To 13 | View Replies]

To: mg39
You mean you don't trust the cigarette companies to pass along the savings? :)

LOL, NO.

Even if cigarette prices dropped, the government would raise taxes an equal amount.

16 posted on 09/27/2002 8:38:10 AM PDT by Great Dane
[ Post Reply | Private Reply | To 10 | View Replies]

To: Great Dane
Even if cigarette prices dropped, the government would raise taxes an equal amount.

Exactly.

17 posted on 09/27/2002 8:46:08 AM PDT by SheLion
[ Post Reply | Private Reply | To 16 | View Replies]

To: mg39
Taxes are a separate issue.

Maybe, maybe not. Big tobacco is losing LOTS of money because people are finding ways to avoid the taxes and the cost of their liability settlements. By agreeing to letting the FDA regulate them, it's a cinch that little tobacco will be effectivly outlawed. That's the way the money trail looks to me anyway.

18 posted on 09/27/2002 9:20:15 AM PDT by bjs1779
[ Post Reply | Private Reply | To 15 | View Replies]

To: bjs1779
Little tobacco -- meaning the small cigarette companies? You're right, they're probably doomed. For that matter, the little tobacco farmer is too (like all small farmers). The buyout is a way to cushion the fall for these guys, because prices for unfinished tobacco will plummet once USDA gets out of the quota/marketing loan business.

And that's not even taking into account competition from African, Brazilian, Turkish, and Chinese tobacco producers.

I'll tell you what: if I was a cigarette smoker, I'd want the FDA to keep an eye on the quality of imported tobacco, as some of those foreign countries are pretty slipshod when it comes to things like regulating pesticide/herbicide use.

One way or another, the end is near for the small American tobacco farmer.
19 posted on 09/27/2002 9:31:06 AM PDT by mg39
[ Post Reply | Private Reply | To 18 | View Replies]

To: mg39
As for the FDA regulation of tobacco products, it's a small price for the cigarette companies to pay in exchange for lower tobacco prices

Why the nerve of those evil evil tobacco companies wanting to make more money on their product. Before you know it they might make as much on the sale of their product as, as , as the government!

20 posted on 09/27/2002 9:39:05 AM PDT by N. Theknow
[ Post Reply | Private Reply | To 5 | View Replies]


Navigation: use the links below to view more comments.
first 1-2021-29 next last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson