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‘Tobacco Road’ detours through gold dome

Authors allege ‘smoking gun’ with tobacco industry report

By Leigh E. Rich

The ruckus created by the recent release of an American Lung Association of Colorado report detailing the tobacco industry’s political activities in the state since the 1980s gives new meaning to the quip about laws and sausages. But tobacco control advocates, including report authors Anne Landman and Peter Bialick, emphasize the importance of knowing how tobacco-related policies are being made in Colorado.

According to Landman, an independent tobacco control researcher who based the one-year study on internal industry documents released as a result of the Master Settlement Agreement in 1998, the tobacco industry has a “siege mentality” when it comes to combating smoking control ordinances and laws at both the state and local level.

And, often, the tobacco industry has prevailed.

Take the 1990 tobacco tax initiative that would have increased a tax on cigarettes by 25 cents per pack. According to Landman and Bialick’s report, “Tobacco Industry Involvement in Colorado,” out-of-state tobacco companies spent “$2.08 million to oppose the 1990 tax measure,” including legally challenging the title of the initiative and the validity of initiative signatures. The initiative failed to make the ballot that year by 385 signatures.

The report credits the efforts of The Tobacco Institute’s Colorado Executive Committee, a Denver-based group funded by tobacco magnates Philip Morris, R.J. Reynolds, Lorillard, and Brown and Williamson.

Then there was the 1992 tax effort, which would have raised the state’s cigarette tax by 35 cents. With the infrastructure of the Colorado Executive Committee already in place and the lawsuit over signatures for the 1990 initiative ongoing, the report states, “the amount of time left to coordinate signature gathering before the election was short” and the measure “did not materialize.”

While tobacco companies were prepared to spend as much as $3.5 million, according to internal documents, it seems the industry was not worried. In a letter dated July 20, 1992, Robert S. McAdam, vice president of special projects of The Tobacco Institute, wrote: “With only three weeks remaining for signatures to be gathered, it appears practically impossible for the proponents to gather enough signatures to qualify this initiative for the ballot this year. It appears certain that we will not have to fight an initiative in this state this year.”

The industry was again triumphant in 1994, the report states, spending more than $5.3 million to oppose a 50-cent initiative and, by this time, working mainly via “front groups” to “disguise its involvement in ballot initiative campaigns and hide its opposition to smoking restriction and tax measures by funneling opposition through more credible allies.”

According to the report, the tobacco industry changed its previously overt tactics opposing smoking control measures in the 1990s, working mostly “underground” and behind front groups after several cities in Colorado passed local smoking limitations in workplaces and public places beginning in the late-1980s.

Citing a March 30, 1994 speech given by a senior vice president at Philip Morris, the report quotes Tina Walls as saying, “Instead, we try to provide the media with statements in support of our positions from third party sources, which carry more credibility than our company and have no apparent vested interest.”

Landman and Bialick’s report explicitly names so-called front groups such as The Tobacco Institute, Citizens Against Tax Abuse and Government Waste, the Tobacco Action Network, and the Colorado Indoor Air Coalition as well as Colorado organizations and legislators “friendly” to the industry.

All of this helps to explain Colorado’s comparatively low state tax on tobacco products, tobacco control advocates emphasize. Currently, Colorado collects 20 cents for every pack of cigarettes sold.

“We’re the second lowest state tax in the nation,” says Mike Melanson of Citizens for a Healthier Colorado (CHC), a group sponsoring the most recent ballot initiative that would raise that state’s excise tax on a pack of cigarettes to 84 cents—6 cents above the national average.

The 64-cent increase will be put before voters on the November ballot if the group can collect the 67,820 signatures needed by Aug. 2. The CHC is currently working toward a goal of 110,000, “just to make sure we’ve got that insurance” in case the validity of the signatures is challenged, Melanson says.

And he adds the CHC will be carefully reading Landman and Bialick’s report. “There’s information in there that will be advantageous” and that will help to “prepare us for the tobacco industry’s dirty tactics.”

If the latest initiative comes before Colorado voters later this year, Melanson and other control advocates are optimistic the increased tax will pass.

This fight, Melanson says, differs from the 1994 initiative. “It’s 10 years later, There’s a lot more information out there. … And both smokers and nonsmokers are supportive of the CHC’s goals” of preventing tobacco use among children and creating new funding for health care.

Melanson also cites Centers for Disease Control statistics demonstrating that for every 10 percent increase in tobacco prices, overall cigarette consumption decreases by 3 to 5 percent.

The tobacco industry has a different story to tell, however. Web sites for Philip Morris, R.J. Reynolds and Lorillard, for example, call such tobacco taxes “bad fiscal policy,” “an unfair and selective tax burden on lower and moderate income Americans engaging in legal behavior,” and “a regressive tax on the working class,” respectively. The sites also opine that excise taxes “encourage cross-border smuggling, gray market activity and illegal sales,” and that “[s]tate and local governments have increasingly turned to cigarettes as a means of financing their ever-burgeoning budget shortfalls.”

Melanson disagrees. Colorado’s “meager” tax, he says, is higher only than Kentucky’s tax of 19 cents.

“Colorado is the source of the black market. You can get cheap cigarettes here.”

The ‘friendly’ in-fighting

You also can find a pro-tobacco legislature here, too, Landman and Bialick’s report claims, with several Colorado legislators identified as “friendly” to tobacco interests.

According to the report, internal tobacco company documents boast of the industry’s pull with the Colorado General Assembly, including drafting and influencing pro-tobacco legislation and the ability to derail bills it doesn’t like. A 1991 Tobacco Institute analysis, for example, asserted the “tobacco industry enjoys sufficient support in the (Colorado) Senate and House that such (public smoking restriction) legislation can be controlled.”

“Another Institute document bragged about the industry’s ability to ‘set the agenda in state legislatures,’” Landman says. “I was struck by the fact that most Coloradans are probably completely unaware of the confidence these companies have in their ability to control Colorado’s legislature. You can look at the industry’s goals and strategies and see them played out in the legislature even to the current day.”

Even in the most recent legislative session, Landman claims, failed bills such as HB 1410 and HB 1455 would have, in effect, “decapitated” the proposed 64-cent initiative.

According to Landman, this is a type of bait-and-switch strategy—where the tobacco industry promotes “incremental, intermittent” legislation weaker than that proposed by tobacco-control groups. HB 1410, Landman and Bialick’s report says, would have increased the cigarette tax by 50 cents, instead of the CHC initiative’s 64 cents, and “put the funds toward non-tobacco-related programs.” HB 1455, a securitization bill, would have exchanged Colorado’s Master Settlement Agreement payments “for a one-time payment to the state.”

“That tracks with Philip Morris strategy,” Landman says.

Indirectly supporting weaker tobacco control legislation is a common tactic the tobacco industry uses, the report states. According to Landman, explicit Philip Morris strategy has involved the promotion of statewide preemptive laws in all 50 states that would “make it illegal for a municipality to enact a smoking ordinance stronger than the state law.”

To date, more than half of the states have such umbrella laws.

Efforts to pass a statewide preemptive law have not been successful in Colorado, proving that “when public health advocates are aggressive, they can prevail,” says Stanton A. Glantz, Ph.D., director of the Center for Tobacco Control Research and Education at the University of California-San Francisco and co-author of a 1996 paper, “Tobacco Industry Political Activity in Colorado 1979-1995.”

Tobacco control advocates such as Glantz and Melanson believe public health efforts, which often have considerably less financial resources, can wage a fierce fight even when up against the monetary prowess of the tobacco industry.

Armed with “excellent numbers” from a CHC poll and a Denver Metro Chamber of Commerce poll showing support for the 64-cent tax initiative, Melanson concedes, “I fully expect the tobacco industry to outspend us.”

Political influence might be a different story, however. Similar to Landman and Bialick’s report, Glantz’s 1996 paper, co-authored with Fred M. Monardi and Amanda O’Neill, states the “Colorado General Assembly appears to be anti-tobacco control.” The Glantz paper also demonstrated a statistical relationship between tobacco industry campaign contributions and state legislative behavior.

“The more money a legislator receives,” the 1996 paper states, “the less likely he or she is to support tobacco control efforts.”

The California group also found an additional partisan effect.

“The tobacco industry is much more supportive of the Republican Party,” Glantz says.

While the Glantz paper links tobacco industry campaign contributions with several legislators’ voting records regarding tobacco policy, Landman and Bialick’s report appears to target specific Colorado leaders—in particular, taking to town Sen. Norma Anderson (R-Lakewood), then a state representative, for allegedly backing HB 1163 in 1993.

Titled “Concerning the Regulation of Smoking” and carried by then-Rep. Tom Ratterree (R-El Paso) and then-Sen. Dave Wattenberg (R-District 8), HB 1163 would have overturned several smoking bans in Colorado and instead allowed business owners to set their own policies regarding lighting up. The bill came out of the House State, Veterans and Military Affairs Committee on Jan. 22, 1993, by a vote of 9 to 2, and had a second reading on amendment on Jan. 29. The bill, however, was postponed indefinitely in committee on Feb. 11.

Serving on the House State, Veterans and Military Affairs Committee, then-Rep. Anderson did favor the bill on the first vote but says she voted against it when it came to the House floor.

“I do remember being a ‘no’ vote on the preemption bill,” Anderson says, admonishing the report’s researchers for “getting the wrong information. … I can do better research right here at home.”

The report also states, citing a Rocky Mountain News editorial, “that Philip Morris put on a golf tournament at Red Rocks Country Club to benefit Norma Anderson” in 1997. The Sept. 14, 1997 editorial supposedly quoted the invitation as stating the greens fees would be paid by Philip Morris and requested a $100 campaign contribution to Anderson.

“Philip Morris did not pay the greens fees,” Anderson says, instead explaining that each individual golfer paid his or her own fees of $90 and then, if they so chose, wrote a separate check to Anderson’s campaign.

Anderson admits the invitation wasn’t very clear, but added that the report’s authors “don’t do good research if they use editorials. Good grief!”

Landman and Bialick’s report also accuses Anderson of favoring tobacco interests when she, among others, brought HB 1455 to securitize the state’s Master Settlement Agreement payments. Claiming the bill would have “effectively de-funded tobacco prevention programs,” the report notes that Anderson proposed the bill at Gov. Bill Owens’ suggestion.

Dan Hopkins, a spokesman for Gov. Owens, says securitization would “actually guarantee that we will have the tobacco settlement money to spend” and that many people are “not aware of the fact that these tobacco funds are in serious jeopardy.”

The interest accrued from a one-time tobacco settlement payment would then be used to fund smoking prevention and cessation programs, Hopkins adds.

He also stresses that while millions of dollars of settlement money are being used to fund smoking cessation programs in Colorado, the money also supports programs such as the Ryan White Comprehensive AIDS Resources Emergency Program, the Children’s Health Plan, and the Tony Grampsas Youth Fund.

He asks the American Lung Association of Colorado and other groups critical of the administration, “What do you want to pull the plug on?”

The tobacco settlement payments are adjusted every year, Hopkins adds, and “if the tobacco industry suffers a couple more of these high-level lawsuits, there will be no more money.”

According to Hopkins, other states have opted for securitization, including Alaska, Arkansas, Illinois, Iowa, Louisiana, New Jersey, North Dakota, Oregon, Rhode Island, South Carolina, South Dakota, Washington, Wisconsin, and various counties in California and New York. This past legislative session, 13 additional states considered securitization, including Colorado.

HB 1455 was killed in the House in early May.

The report also names Gov. Owens, who as a state representative was identified in a 1988 Tobacco Institute memo as “a friendly member” of the House Local Government Committee. The memo states that Owens was a “good possibility” to “offer a substitute bill with desirable provisions with a good chance of having it adopted and passed out of committee.”

“Somebody, some lobbyist, thought they knew something,” says Hopkins, deeming the document “a pretty isolated memo that really bears no truth at all.”

Politicians selling out?

Such political lobbying tactics by the tobacco industry are not unique to Colorado, emphasizes Glantz. And neither are the results.

“The tobacco companies, for a relatively modest investment, are able to prevent the implementation of state policies” that better the public’s health, Glantz says. “It’s a great deal from their point of view.”

According to Glantz, when tobacco companies invest money to oppose tobacco control campaigns at state and local levels, they can preserve a permissive sales environment, discourage controls on secondhand smoke, prevent the state from increasing taxes, and kill off state-funded anti-tobacco programs or limit their scope to children and pregnant women.

“I wish I could make as good of an investment,” Glantz sadly laughs. “The really discouraging thing is how cheap the politicians sell out.”

Not everyone agrees.

“The biggest issue is: What is their complaint?” Anderson asks, referring to Landman and Bialick’s report. “The tobacco industry is legal. They’re not illegal entities, number one, and number two, I don’t really understand what they’re trying to prove in their research. Did I do something illegal? I don’t think so.”

Glantz calls this a “ridiculous” argument that “itself has been fed by the tobacco companies. … Pornography’s legal, too. … The fact that it’s legal doesn’t mean that you shouldn’t tax it. The people of Colorado provide a huge subsidy to the tobacco industry—the medical system. (The argument) is just a non sequitur.”

“The report is based on tobacco industry documents,” stresses Bialick, founder and president of the Group to Alleviate Smoking Pollution (GASP) of Colorado. “Certainly, we’ve put two and two together … but the documents speak for themselves.

“If they have issue with what was said,” Bialick half-jokingly tells the report’s critics, “they should call the tobacco industry.”

Anderson, on the other hand, also asks why Landman and Bialick’s report studying legislators was funded by grant money earmarked for tobacco prevention and cessation.

“And they wonder why we don’t want to fund them?” Anderson says. “The Quitline—it works. I’m happy to fund the Quitline. But show me another program that works.”

But this issue of tobacco industry involvement in the Colorado political process is more than mere rhetorical debate to tobacco-control advocates.

“We’ve seen, time and again,” says Chris Sherwin, executive director of the Colorado Tobacco Education and Prevention Alliance, “the people opposed to local ordinances vehemently deny that there is any tobacco industry involvement.”

And Glantz doesn’t mince words. “I think you’re talking about something much more pernicious … a fundamental corruption of the democratic process to protect the interests of an industry that kills people.”

Landman and Bialick’s report, Glantz says, “really shows the underbelly of the process in Colorado. And the politicians don’t like it. … Politicians don’t want to be held accountable for their pro-tobacco activities.”

Authors allege ‘smoking gun’

It is this alleged covert strategy aimed at influencing the Colorado Legislature as well as local ordinance campaigns that has tobacco control advocates most worried.

“This report … connects much of this anti-public health activity in Colorado back to the tobacco industry,” Landman says.

While the industry has failed in its attempts to promote a statewide preemptive law, Landman and Bialick’s report documents the successes it has had at the grassroots level—in particular, derailing or postponing smoking restriction ballot measures in Telluride in 1993, Durango in 1994, Boulder in 1995, and Montrose in 1998.

The report’s authors say they were surprised to find the industry so concerned with local Colorado governments.

“No place in Colorado is too small for the industry’s influence,” Landman says.

Also a big surprise, even for the Colorado Secretary of State’s office, was the failure of the industry to disclose all of its reportable direct or in-kind campaign contributions in the Telluride, Durango and Boulder efforts.

The industry never reported such “behind-the-scenes” involvement as an expenditure, Bialick says.

“Failure to disclose campaign contributions is illegal,” Landman unequivocally states.

Not much can be done now that the barn door is closed, however. In an e-mail statement, Dana Williams of the Secretary of State’s office explained, “Colorado law limits the reporting time of campaign finance violations to 180 days after the alleged incident. Since many of these issues took place several years ago, it will not be possible to move forward with the complaint process.”

With only a staff of 15, Lisa Doran of the Secretary of State’s press office adds, “It’s difficult to know what isn’t reported. It’s often from other sources that we hear of the things.”

Stating that in some cases they must “rely on the vigilance of our electors” in assisting with such violations, Doran says, “Obviously we hope that we have a better reporting mechanism now in place than we had before.”

And perhaps that’s where Landman and Bialick’s report comes in, supporters say.

“We have had opportunities to see here and there how the tobacco industry” has operated in Colorado, Sherwin says. “Never had we had all of it together in one place. … We hope it is a wake-up call to everyone.”

“This report will serve as the Bible … to what the industry does in Colorado,” adds Bialick.

But even armed with insight of internal tobacco industry documents, Bialick says that GASP’s strategy will not change. Reducing the public’s exposure to secondhand smoke and promoting smoke-free policies “will continue to be our goal until statewide legislative measures” protect the public from environmental tobacco smoke.

While the courses of tobacco-control and public health groups may hold steady even in light of Landman and Bialick’s findings, so too will the tobacco industry’s. Landman believes the industry will continue to use front groups, recruiting additional allies and creating new groups as current ones are outed. For example, she says, when the National Smokers Alliance was revealed as a Philip Morris front group in 1999, the Colorado Indoor Air Coalition surfaced.

Landman also expects tobacco companies to continue to promote preemptive and proactive legislation—strategies that enable them to “couch their issues under bills of completely different topics.”

“We have to watch very carefully to see that a preemptive amendment doesn’t get attached to some bill,” she says. “We have to constantly be vigilant.”

Glantz agrees, emphasizing the “lengths the tobacco companies go to stay in the shadows. They know that politicians don’t want to be publicly identified with them. One of the things that the public health people can do is to try to put a very bright light on it.”

“I think we have a nice glimpse,” Landman concludes. “We are now privy to their documents. … We see the evolution of their strategies” and can potentially predict, she says, at least in the coming decade, how the industry will operate. 

Rich, L. E. (2004, July 9). ‘Tobacco Road’ detours through gold dome. The Colorado Statesman, pp. 1, 6–7, 11.

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