REMARKS CONCERNING THE MCCAIN-HOLLINGS BILL (S.1415)

PRESENTED AT THE REQUEST OF THE DEMOCRATIC CAUCUS OF THE SENATE APRIL 20, 1998

C. EVERETT KOOP, M.D.

FOR DISTRIBUTION

THE OPPORTUNITY TO SPEAK BEFORE YOU TODAY CONCERNING THE TOBACCO LEGISLATION SOON TO BE CONSIDERED BY THE SENATE IS VERY MUCH APPRECIATED. MAY I SAY IN A PREAMBULATORY WAY THAT IT IS TIME WE STOOD BACK AND ASSESSED THE INDUSTRY WITH WHICH WE ARE DEALING.

AT FIRST TOBACCO - WITH A CAPITAL T - ENJOYED YEARS OF FAVORABLE TREATMENT BY THE CONGRESS OF THE UNITED STATES. IT WAS ONLY NATURAL TO SO DO BECAUSE TOBACCO INCOME HAD PLAYED SUCH A DECISIVE ROLE IN FUNDING THE REVOLUTIONARY WAR; AND AT THAT TIME NOTHING WAS KNOWN ABOUT THE DELETERIOUS EFFECTS OF TOBACCO USE.

AFTER THE PASSAGE OF THE FOOD, DRUG AND COSMETIC ACT, IT WAS SAID SO OFTEN THAT BECAUSE TOBACCO WAS NOT A FOOD, DRUG, OR COSMETIC, IT WAS NOT REGULATABLE, THAT IT WAS ACCEPTED BY MOST AS GOSPEL TRUTH - AT LEAST UNTIL 1996.

THEN THE FDA SAID IT INDEED HAD THE STATUTORY AUTHORITY TO REGULATE TOBACCO -- AND THAT BELIEF WAS CONFIRMED BY JUDGE OSTEIN IN THE SPRING OF 1997 IN GREENSBORO, NORTH CAROLINA. AN APPEALS PROCESS IN REFERENCE TO THAT DECISION IS UNDERWAY.

SURGEONS GENERAL SINCE 1964 HAVE PROVIDED LEADERSHIP IN THE EDUCATIONAL ENDEAVOR TO INFORM THE PUBLIC AND ITS LEADERS CONCERNING THE HARMFUL EFFECTS OF TOBACCO USE.

IF - AS SURGEON GENERAL FROM 1981 TO 1989 - I ADDED ANYTHING TO THAT HEALTH MESSAGE, IT WAS TO POINT OUT THAT WE WERE DEALING WITH AN INDUSTRY THAT COULD NOT BE TRUSTED TO TELL THE TRUTH AND AN INDUSTRY THAT BLUFFED ITS WAY THROUGH THE MEDIA, LYING TO US ABOUT NOT ONLY THE HARMFUL EFFECTS OF TOBACCO USE BUT THE ADDICTIVENESS OF NICOTINE AS WELL.

I FELT JUSTIFIED IN SO DOING BECAUSE OF DOCUMENTS AND MEMORANDA FILCHED FROM THE DESKS OF CIGARETTE EXECUTIVES, COPIED, AND SENT TO ME PERIODICALLY BY EMPLOYEES OF CIGARETTE COMPANIES CONCERNED ABOUT THE ETHICS OF THEIR COMPANY.

THAT AND THE FACT THAT BY THE MID YEARS OF MY TWO FOUR YEAR TERMS AS SURGEON GENERAL THERE WERE 55,000 ARTICLES IN PEER REVIEWED JOURNALS IN ALMOST EVERY LANGUAGE USED BY THE SCIENTIFIC WORLD WHICH CONFIRMED THE EIGHT REPORTS ON SMOKING AND HEALTH THAT I DELIVERED TO THE CONGRESS.

TWO OF THEM WERE SEMINAL: THE REPORT ON ENVIRONMENTAL TOBACCO SMOKE AND THE 1988 REPORT THAT DECLARED NICOTINE NOT ONLY AN ADDICTIVE DRUG BUT AS ADDICTIVE AS WAS HEROIN OR COCAINE. THE SCIENTIFIC EVIDENCE IN THOSE EIGHT REPORTS HAS NOT BEEN SUCCESSFULLY CHALLENGED AND INDEED HAS BEEN REINFORCED BY FURTHER SCIENTIFIC INVESTIGATION MANY TIMES OVER.

ABUNDANT EVIDENCE HAS ESTABLISHED THE CAUSAL RELATIONSHIP BETWEEN THE USE OF TOBACCO AND CANCER, CARDIOVASCULAR DISEASE, CHRONIC OBSTRUCTIVE LUNG DISEASE, PERIPHERAL VASCULAR DISEASE, STROKE, AND A VARIETY OF SERIOUS PEDIATRIC MALADIES IN CHILDREN EXPOSED TO ENVIRONMENTAL TOBACCO SMOKE.

THESE ILLNESSES ARE SO SEVERE THAT NEARLY ONE OF EVERY 5 DEATHS IN THE U.S. ARE ATTRIBUTED TO TOBACCO.

NOW THE WORLD KNOWS THE AMAZING, CONSISTENT, ANTISOCIAL BEHAVIOR OF THE TOBACCO INDUSTRY -- THAT THE INDUSTRY HAS DECEIVED THE AMERICAN PEOPLE WITH BALD-FACED LIES ABOUT THE HARMFUL EFFECTS OF THEIR PRODUCTS AND THE ADDICTIVENESS OF NICOTINE.

THE ENORMITY OF THE TOLL TOBACCO TAKES IN THE FORM OF DISEASE, DISABILITY, AND DEATH IS IN A PECULIAR WAY MASKED BY THE ENORMITY OF THE NUMBERS. EACH YEAR 430,000 AMERICANS, MOST DEPRIVED OF YEARS OF LIFE, ARE DYING AFTER DECLINING HEALTH AND SUFFERING WITH TOBACCO-RELATED DISEASES AND CONDITIONS.

PLEASE RECALL THAT AS RECENTLY AS 1994 THE SEVEN TOP EXECUTIVES OF THE COUNTRY'S LARGEST TOBACCO MANUFACTURERS STOOD BEFORE A COMMITTEE OF CONGRESS AND TESTIFIED UNDER OATH THAT TOBACCO DOES NOT KILL AND NICOTINE IS NOT ADDICTIVE, WHILE DENYING THAT THEY WERE MARKETING TO KIDS AND CREATING A PHONY CONTROVERSY OVER SMOKING AND HEALTH, THEIR ACTIONS SAID OTHERWISE. WE ALL KNOW ABOUT JOE CAMEL.

SOMETIME BETWEEN THE ANNOUNCEMENT BY THE PRESIDENT THAT HE WOULD GO ALONG WITH DR. KESSLER'S BELIEF THAT THE STATUTORY AUTHORITY EXISTED FOR FDA TO REGULATE TOBACCO AND THE PRONOUNCMENT OF JUDGE OSTEEN AFFIRMING THAT AUTHORITY, SECRET TALKS BEGAN BETWEEN THE ATTORNEYS GENERAL OF THE SEVERAL STATES AND THE TOBACCO INDUSTRY.

ALTHOUGH I TRIED TO BELIEVE THAT THE SO-CALLED ``SETTLEMENT'' MADE AVAILABLE TO THE PUBLIC ON JUNE 16, 1997 MIGHT BE WHAT IT WAS ADVERTISED TO BE - A NEW AND IMPROVED WAY OF THE TOBACCO INDUSTRY DOING BUSINESS - AFTER READING IT I PRONOUNCED IT DEAD ON ARRIVAL BECAUSE IT WAS A SELL OUT TO THE TOBACCO INDUSTRY AND BOUGHT THEM THE SECURITY THEY NEEDED FOR FINANCIAL PLANNING FOR THE NEXT 25 YEARS, WHILE IT DID VERY LITTLE FOR PUBLIC HEALTH.

THERE ARE TWO THINGS NOTABLE ABOUT THE SETTLEMENT: FIRST THE AMOUNT OF MONEY OFFERED OVER A 25 YEAR PERIOD -- 368.2 BILLION DOLLARS -- WAS AND IS SO DAZZLING THAT I THINK IT HAS TAKEN THE ATTENTION OF MANY AWAY FORM THE FUNDAMENTAL ISSUES THAT WERE PRESENTED IN SUCH A FLAWED FASHION.

SECOND AND MORE IMPORTANT, THE SETTLEMENT PROPELLED THIS ARGUMENT DIRECTLY INTO THE LAP OF CONGRESS WHERE IT BELONGS AND YOU NOW HAVE THE OPPORTUNITY TO FORGE A LEGISLATIVE SOLUTION TO THE MANY PROBLEMS PRESENTED BY TOBACCO.

AS SUSAN P. KONIAK, PROFESSOR OF LAW AT BOSTON UNIVERSITY, SAYS ``THE JUNE 20th DEAL WAS NEVER REALLY A SETTLEMENT AT ALL BUT WAS SIMPLY AN AGREEMENT AMONG THE NEGOTIATING PARTIES TO JOIN HANDS AND LOBBY CONGRESS FOR A SPECIFIC LEGISLATIVE PACKAGE THAT NONE OF THE PARTIES HAD THE POWER TO DELIVER.''

RECENTLY THE TOBACCO INDUSTRY HAS MADE CONCESSIONS THAT JUST A FEW YEARS AGO WERE UNTHINKABLE, ACKNOWLEDGING THAT SMOKING AT LEAST PLAYED A PART IN CAUSING LUNG CANCER, THAT NICOTINE MIGHT, IN FACT, BE ADDICTIVE AND THAT SOME MARKETING ACTIVITIES MAY HAVE INFLUENCED KIDS TO START SMOKING.

WHEN I SAY THEY MADE CONCESSIONS, I ACKNOWLEDGE THAT THEY DID SO RELUCTANTLY AND WITH MANY CAVEATS.

ONE OF THE REASONS THAT I AM HERE THIS AFTERNOON IS THAT WHILE THE SECRET TALKS WERE GOING ON BEHIND CLOSED DOORS BETWEEN THE ATTORNEYS GENERAL OF THE SEVERAL STATES AND REPRESENTATIVES OF THE TOBACCO INDUSTRY, A GROUP OF CONGRESSMEN FROM BOTH HOUSES AND ON BOTH SIDES OF THE AISLE ASKED ME AND DR. DAVID KESSLER TO CO-CHAIR AN ADVISORY COMMITTEE ON TOBACCO POLICY AND PUBLIC HEALTH FOR THESE CONGRESSIONAL MEMBERS.

WE ASSEMBLED A GROUP REPRESENTING 23 DISTINGUISHED PUBLIC HEALTH ORGANIZATIONS, SECURED AN EXCELLENT VOLUNTARY STAFF, AND WERE ABLE TO GIVE A REPORT TO CONGRESS AND TO THE WHITE HOUSE 32 DAYS AFTER ACCEPTING THE ASSIGNMENT.

THAT REPORT WAS REMARKABLE IN THAT IT WAS NOT A MAJORITY REPORT OF THOSE PRESENT, BUT IT WAS A CONSENSUS STATEMENT AGREED TO BY ALL REPRESENTATIVES OF THE 23 ORGANIZATIONS.

I HAVE A COPY FOR THE RECORD, MR. CHAIRMAN.

THE DOCUMENT HAS BECOME KNOWN AS THE KOOP-KESSLER REPORT AND HAS BEEN PRESENTED TO THE CONGRESS AS WHAT SHOULD BE THE GOLD STANDARD AGAINST WHICH TO MEASURE ANY TOBACCO LEGISLATION.

WE ARE NOT DEALING HERE WITH AN AUTOMOBILE INDUSTRY WHERE ONE COMPANY THROUGH AN ENGINEERING ERROR PRODUCED A CAR THAT ENDANGERED THE HEALTH AND THE LIVES OF THOSE WHO RODE IN IT.

WE ARE DEALING WITH AN INDUSTRY WHERE ALL OF THE MAJOR TOBACCO COMPANIES KNEW FOR LONGER THAN DID THE GOVERNMENT, AND IN GREATER DEPTH THAN DID THE GOVERNMENT, THE HARMFUL EFFECTS OF THE USE OF TOBACCO AND THE ADDICTIVENESS OF NICOTINE.

THEY ALSO KNEW THAT THEIR PRODUCTS WERE LETHAL TO ABOUT ONE-THIRD OF THEIR CUSTOMERS. THEY DELIBERATELY MARKETED TO CHILDREN AND MINORITIES. THEY UNDERSTOOD THAT NICOTINE WAS AN ADDICTIVE DRUG AND USED THAT KNOWLEDGE TO ALTER THEIR PRODUCTS TO GAIN THE LARGEST NUMBER OF STEADY CUSTOMERS POSSIBLE.

THAT WAS BEHAVIOR EGREGIOUS ENOUGH, BUT TO DENY THIS KNOWLEDGE, TO LIE ABOUT THE KNOWN HEALTH EFFECTS OF THEIR PRODUCTS AND TO MASQUERADE AS AN INDUSTRY FUNCTIONING WITHIN THE ETHICAL AND MORAL NORMS OF OUR SOCIETY, IS UNACCEPTABLE.

WHEN I REFER TO THE TOBACCO INDUSTRY, I AM NOT REFERRING TO THOSE WHO GROW TOBACCO, THOSE WHO TRANSPORT IT, THOSE WHO SELL ITS MANUFACTURED PRODUCTS IN CONVENIENCE STORES - I AM REFERRING TO THE DECISION MAKING EXECUTIVE BODIES OF THE VARIOUS TOBACCO COMPANIES AND THEIR LAWYERS WHO WILLFULLY SET ABOUT A FOUR DECADE COURSE OF DECIEVING THE AMERICAN PEOPLE.

AND YOU KNOW THESE THINGS NOT BECAUSE YOU HEARD THEM FROM C. EVERETT KOOP OR FROM DAVID KESSLER OR FROM THE VOLUNTARY ANTI-SMOKING AGENCIES THAT HAVE BEEN SO HELPFUL IN THE FIGHT AGAINST TOBACCO USE.

YOU KNOW THESE THINGS THROUGH TOBACCO INDUSTRY MEMORANDA AND INTERNAL DOCUMENTS, THROUGH DOCUMENTS FORMERLY THOUGHT TO BE UNOBTAINABLE BECAUSE OF ATTORNEY-CLIENT PRIVILEGE, SOME OF WHICH HAVE NOW ENTERED THE PUBLIC DOMAIN AS THEY HAVE SERVED AS EVIDENCE IN REPEATED TRIALS IN WHICH THE TOBACCO INDUSTRY WAS THE DEFENDENT.

THE AMERICAN PUBLIC IS OUTRAGED AT WHAT THEY HAVE LEARNED WITH THE RELEASE OF SUCH DOCUMENTS AND I REALLY BELIEVE THAT IN HIS OR HER HEART, EVERY MEMBER OF CONGRESS IS EQUALLY OUTRAGED.

WINSTON CHURCHILL ONCE SAID THAT AMERICANS CAN ALWAYS BE COUNTED ON TO DO THE RIGHT THING - AFTER THEY HAVE TRIED EVERYTHING ELSE FIRST. WE HAVE DONE A LOT OF ``OTHER THINGS LET'S GET THIS ONE RIGHT NOW. FIRST''

THIS CONGRESS SHOULD HAVE NO DIFFICULTY IN ACCOMPLISHING SUCH AN OBJECTIVE BECAUSE DOING SO REQUIRES NO MORE THAN LIVING BY THE ETHICAL AND MORAL RESPONSIBILITIES EXPECTED OF EVERY CITIZEN AND THE FAIR APPLICATION OF THE LAWS THAT ALREADY GOVERN THIS NATION.

LAST FALL THE WHITE HOUSE ASKED DR. KESSLER AND ME TO ``REAFFIRM'' PUBLIC HEALTH UNITY. WE DID THAT AND DIFFERENT GROUPS, SOME AS COALITIONS AND SOME AS INDEPENDENT ORGANIZATIONS, DEBATED STRATEGIES, BUT ALL WERE GUIDED BY THE SAME PRINCIPLES OF PUBLIC HEALTH AND SOCIAL RESPONSIBILITY.

WE REAFFIRMED THIS COMMON GROUND PUBLICLY AT A PRESS CONFERENCE ON FEBRUARY 17TH AND ON THAT DAY A LETTER WAS SENT TO THE SENATE AND HOUSE LEADERSHIP. SINCE THEN THE SAVE LIVES COALITION HAS SECURED 75 MORE SIGNATURES FROM PUBLIC HEALTH ORGANIZATIONS AND IN YOUR HANDOUTS YOU HAVE A RESUBMISSION OF THAT FEBRUARY LETTER WITH THE REQUEST THAT IT BE SENT TO ALL MEMBERS OF CONGRESS, NOT ONLY THE LEADERSHIP.

ON THAT SAME DATE, FEBRUARY 17TH, WERE REITERATED IN AN EDITORIAL BY ME, DR. KESSLER, AND THE EDITOR OF THE JOURNAL OF THE AMERICAN MEDICAL ASSOCIATION, DR. GEORGE LUNDBERG.

ON APRIL 2ND, THAT IS, SINCE THAT LETTER WAS PREPARED, THE SURGEONS GENERAL OF THE UNITED STATES NOW LIVING MET ON A SPECIAL OCCASION AT JOHNS HOPKINS SCHOOL OF PUBLIC HEALTH AND HYGIENE.

A STATEMENT ADDRESSED TO THE CONGRESS AND SIGNED BY SURGEONS GENERAL AND ONE ACTING SURGEON GENERAL WHO HELD THIS RESPONSIBILITY OVER THE LAST QUARTER OF A CENTURY SIGNED A SHORT LETTER AGAIN REQUESTING THAT THE CONGRESS DO THE RIGHT THING. A COPY OF THAT LETTER IS ALSO INCLUDED IN YOUR HANDOUTS.

THANK YOU FOR LETTING ME SAY THESE THINGS AS BACKGROUND TO THE BUSINESS OF THE DAY -- TO ADDRESS WHAT WE THINK IS THE TEMPLATE BY WHICH LEGISLATION SHOULD BE MEASURED AND THE BILL WHICH WAS APPROVED BY THE SENATE COMMERCE COMMITTEE BY A VOTE OF 19 TO 1. BILL S-1415, COMMONLY KNOWN AS THE MCCAIN-HOLLINGS BILL.

I WOULD LIKE TO CONGRATULATE SENATORS MCCAIN AND HOLLINGS AND ASSURE THEM OF MY SUPPORT IN COMING THIS FAR WITH A BILL IN SUCH A DIFFICULT LEGISLATIVE AREA. THERE IS PROBABLY NO TOUGHER COMMITTEE IN CONGRESS THAN THE SENATE COMMERCE COMMITTEE WHEN IT COMES TO TOBACCO LEGISLATION.

NOTHING THAT I SAY IN REFERENCE TO THIS PROPOSED LEGISLATION SHOULD BE CONSTRUED OF BEING CRITICAL OF MR. MCCAIN OR MR. HOLLINGS OR DESIGNED TO UNDERMINE THE FUNDAMENTAL PROCESS BY WHICH THIS BILL WAS PRODUCED.

LET NOTHING THAT IS SAID TODAY NOR ANYTHING THAT HAS BEEN QUOTED IN THE PRESS - SOMETIMES OUT OF CONTEXT - AS SAID SEPARATELY BY DR. KESSLER OR ME INDICATE THAT DR. KESSLER AND I ARE NOT OF ONE SOLID MIND ON THE ISSUE OF TOBACCO CONTROL.

WE STAND SOLIDLY BEHIND THE KOOP-KESSLER REPORT AND THE TEN PRINCIPLES EXTRACTED FROM THAT REPORT SHOULD BE PART OF ANY PUBLIC HEALTH MEASURE IN THE CONTROL OF TOBACCO.

WE - DAVID KESSLER AND I - HAVE WORKED CLOSELY WITH THE WHITE HOUSE TO ENSURE THAT WHAT WE THINK SHOULD BE EMBODIED IN ANY LEGISLATION CONFORMS WITH WHITE HOUSE INITIATIVES.

I TRUST THAT AS WE DISCUSS THIS VERY IMPORTANT MOMENT IN THE HISTORY OF THE TOBACCO WARS THAT YOU CONSIDER THAT THIS IS THE TIME WHEN AMERICA, LARGELY THROUGH YOUR DIRECTION, CAN CHOOSE A PATH TOWARD SOCIAL REPAIR OR ONE TOWARD IRREVOCABLE PUBLIC LOSS.

ALTHOUGH I THINK THE PUBLIC HEALTH COMMUNITY CAN BE JUSTLY PROUD OF THE KOOP-KESSLER REPORT, AND ITS 20 PAGES OF CONSENSUS, THERE HAVE BEEN EXTRACTED FROM THAT DOCUMENT TEN ESSENTIAL PUBLIC HEALTH ELEMENTS OF COMPREHENSIVE TOBACCO LEGISLATION. THESE HAVE BEEN PROVIDED TO YOU AS HANDOUTS.

1. FULL AUTHORITY FOR THE FOOD AND DRUG ADMINISTRATION TO REGULATE NICOTINE AS A DRUG AND TOBACCO PRODUCTS AS DEVICES.

2. STRONG CHILDREN'S SMOKING-REDUCTION TARGETS, WITH COMPANY-SPECIFIC PENALTIES HIGH ENOUGH TO STIMULATE ACTION BY MANUFACTURERS.

3. GUARANTEED AND IMMEDIATE PER-PACK PRICE INCREASES SUFFICIENT TO REDUCE CHILDREN'S PURCHASES.

4. STATUTORY RESTRICTIONS ON ADVERTISING AND PROMOTION, AS WELL AS ONGOING FDA AUTHORITY TO RESTRICT ADVERTISING AND PROMOTION IN THE FUTURE.

5. FUNDING FOR TOBACCO PREVENTION AND TREATMENT PROGRAMS, INCLUDING COUNTER-ADVERTISING, PROFESSIONAL AND PUBLIC EDUCATION, AND SCIENTIFICALLY SOUND SMOKING CESSATION SERVICES.

6. FUNDING BIOMEDICAL AND BEHAVIORAL RESEARCH ON PREVENTION AND TREATMENT, AS WELL AS ON ADDICTION AND TOBACCO-RELATED ILLNESSES.

7. ELIMINATION OF EXPOSURE TO SECOND-HAND SMOKE IN THE WORKPLACE AND IN PUBLIC PLACES.

8. NO PREEMPTION OF STRONGER STATE AND LOCAL LAWS.

9. FULL DISCLOSURE OF ALL TOBACCO DOCUMENTS.

10. NO SPECIAL LIABILITY PROTECTIONS FOR THE TOBACCO INDUSTRY.

I INVITE YOU TO KEEP THIS LIST HANDY WHEN EVALUATING SPECIFIC TERMS OF MANY LEGISLATIVE PROPOSAL TO DETERMINE IF THE PUBLIC OR THE TOBACCO INDUSTRY BENEFITS BY THAT LANGUAGE.

THE FIRST PRINCIPLE IS: FULL AUTHORITY FOR THE FOOD AND DRUG ADMINISTRATION TO REGULATE NICOTINE AS A DRUG AND TOBACCO PRODUCTS AS DEVICES. I GIVE SENATORS McCAIN AND HOLLINGS AND SENATOR FRIST FOR GETTING THE FDA AUTHORITY ALMOST EXACTLY RIGHT. BUT IN THE SOUND AND FURY OF GETTING A DEAL PUT TOGETHER THAT COULD SURVIVE THE COMMERCE COMMITTEE SOME OF THE IMPORTANT GOALS GOT LOST. I AM ASKING YOU AS I WILL THE REPUBLICAN CAUCUS AND THE PRESIDENT TO ENSURE THAT THOSE GOALS ARE MET BEFORE THIS PROCESS IS OVER. YOU HAVE TO GET THIS ONE RIGHT.

THE SECOND PRINCIPLE STATES ``STRONG CHILDRENS SMOKING REDUCTION TARGETS, WITH COMPANY-SPECIFIC PENALTIES HIGH ENOUGH TO STIMULATE ACTION BY MANUFACTURERS.''

THE TOBACCO INDUSTRY KNOWS BEST HOW TO REACH CHILDREN AND YOUTH. JUST REMEMBER JOE CAMEL AND MICKEY MOUSE. CHILDREN GO THROUGH A LONG PROCESS OF ``CULTURATION'' WHERE THEY HAVE FEW VALUES EXCEPT THOSE LEARNED BY PARENTS, CHURCHES, SCHOOLS, AND THE COMMUNITY. THE TOBACCO INDUSTRY HAS INFILTRATED THIS PROCESS SO THAT ACCEPTANCE OF THEIR PRODUCTS AND DEMAND FOR THEIR USE IS ESTABLISHED LONG BEFORE THE OPPORTUNITY TO ACQUIRE THOSE PRODUCTS OCCURS.

ADOLESCENTS HAVE THE NEED TO ESTABLISH AN INDEPENDENT IDENTITY AND TO DEVELOP LIFE GOALS AND TO COME TO TERMS WITH THEIR BUDDING SEXUALITY. THE TOBACCO INDUSTRY POSITIONS ITSELF WITH A MESSAGE THAT SEEMS TO SAY THAT THEIR PRODUCTS ARE NECESSARY TO ACHIEVE SUCH A TRANSITION SMOOTHLY. ALTHOUGH UTTERLY FALSE, THIS IS READILY BELIEVED BY INNOCENT, ALMOST DESPERATE YOUTH TRYING TO NAVIGATE THIS DIFFICULT TRANSITION IN GROWING UP.

S.1415 CONTAINS ``LOOK-BACK'' PROVISIONS, WHICH CREATE A SET OF YOUTH SMOKING LEVEL REDUCTION TARGETS AND FINANCIAL PENALTIES TO BE ASSESSED AGAINST THE INDUSTRY IF THE TARGETS ARE NOT MET. THE YOUTH SMOKING LOOK-BACK TARGETS REMAIN BASICALLY THE SAME AS THE JUNE 20th DEAL, ALTHOUGH EARLIER FOR YEAR THREE OF 15% FOR CIGARETTES AND 12.5% REDUCTION FOR SMOKER'S TOBACCO ARE ADDED.

THE PENALTIES ARE INCREASED AND MADE NON-TAX DEDUCTIBLE. THE CAP IS RAISED FROM 2 BILLION TO 3.5 BILLION AND THE ``GOOD FAITH'' REBATE PROVISIONS HAVE BEEN REMOVED. A NEW PROVISION, SECTION 203, MAKES THE ATTEMPT TO TIE THE LIABILITY LIMITS IN THE BILL TO ATTAINING THE LOOK-BACK TARGETS.

THESE ARE IMPROVEMENTS, BUT THE PROVISIONS STILL CONTAIN THE MOST SIGNIFICANT FLAWS WE COMPLAINED ABOUT IN THE JUNE 20th SETTLEMENT PROPOSAL: THE TARGETS ARE NOT AMBITIOUS ENOUGH. EARLIER THIS YEAR THE SENATE LABOR AND HUMAN RESOURCES COMMITTEE APPROVED LOOK-BACK TARGETS OF 80% OVER TEN YEARS.

WE WOULD SUPPORT A 20% REDUCTION IN THE FIRST FEW YEARS AND THEN A SIMILAR PERCENTAGE EVERY SUCCESSIVE YEAR THROUGH YEAR SIX. THE BILL USES A WEIGHTED AVERAGE OF KIDS AT VARIOUS AGE LEVELS WHO USE CIGARETTES ON A DAILY BASIS. THIS IS NOT AS ACCURATE A MEASURE AS THE ALTERNATIVE MEASUREMENT AVAILABLE FROM THE UNIVERSITY OF MICHIGAN SURVEY DATA.

THE ANNUAL CAP EVEN OF 3.5 BILLION IS REALLY NOT A STRONG INCENTIVE TO THE TOBACCO INDUSTRY. THEY COULD STILL AGGRESSIVELY MARKET TO KIDS IF THE PROJECTED PROFITS WERE TO EXCEED THE CAP - THAT WOULD BE ABOUT 15 CENTS A PACK. BUT THE LIABILITY TO THE INDUSTRY IS ``JOINT AND SEVERAL''.

LOOK-BACK PENALTIES SHOULD BE PRIMARILY COMPANY OR BRAND SPECIFIC IF THEY ARE TO BE EFFECTIVE. MANY OF THE OTHER BILLS THAT WERE IN THE PROCESS OR HAD BEEN SUBMITTED BEFORE THE McCAIN-HOLLINGS BILL HAVE BETTER LOOK-BACK PROVISIONS AND SOME SUCH AMENDMENT SHOULD SUPERCEDE McCAIN-HOLLINGS.

THE TOBACCO INDUSTRY COULD BE REQUIRED TO REVEAL WHAT THEY HAVE LEARNED ABOUT THE SECRET OF MARKETING TO CHILDREN SO THAT PUBLIC HEALTH OFFICIALS COULD BETTER PLAN COUNTER-OFFENSIVES.

THE THIRD PRINCIPLE IS: GUARANTEED AND IMMEDIATE PER PACK PRICE INCREASES SUFFICIENT TO REDUCE CHILDREN'S PURCHASES.

THE STUDY BY THE NATIONAL ACADEMY OF SCIENCES SEVERAL YEARS AGO FOUND THAT TWO DOLLARS PER PACK WAS THE BEST INCREASE TO PREVENT CHILDREN FROM SMOKING. PLEASE NOTE THAT IN THE 1960's EXCISE TAXES WERE ABOUT 50% OF THE PRICE FOR A PACK OF CIGARETTES. NOW THEY ARE ONLY A THIRD. A LOT MORE COULD BE HANDLED.

PROPOSALS THAT ADD 15 CENTS TO THE PRICE OF A PACK OF CIGARETTES PER YEAR WILL NOT DETER YOUNGSTERS FROM SMOKING THE INCREASE IN PRICE HAS TO BE SUFFICIENTLY LARGE SO THAT THERE IS NOT AN ADEQUATE CUSHION IN KIDS ALLOWANCES TO ABSORB IT.

IT APPEARS THAT IN THE McCAIN-HOLLINGS BILL MOST OF THE PAYMENT AMOUNTS WOULD COME FROM TAX PAYERS OR FROM CONSUMERS WITH VERY LITTLE RISK TO THE EQUITY AND THE ASSETS OF THE MANUFACTURER.

THE OVERWHELMING MAJORITY OF PUBLIC HEALTH OPINION IS THAT A $1.50 PER PACK PRICE INCREASE IN NO MORE THAN THREE YEARS IS A BETTER TARGET THAN S.1415.

DO NOT BE WORRIED ABOUT THE BANKRUPTCY ISSUE. IT IS FALSE. IN CANADA AND EUROPEAN COUNTRIES WHERE PRICE PER PACK HAS BEEN AND IS MUCH HIGHER THAN THAT PROPOSED IN THE UNITED STATES, NO TOBACCO COMPANY HAS EVER GONE OUT OF BUSINESS.

KNOW TOO THAT THE INDUSTRY TRIES TO SET IT UP AS AN ISSUE BY NARROWING THEIR RISK TO THE SMALLEST POSSIBLE ENTITY AND MOVING PROFITS AND ASSETS OUTSIDE TO THE MULTINATIONAL COMPANY. THIS IS CERTAINLY NOT FAIR AND IS EVASIVE. ALSO, IT HAS COME TO MY ATTENTION THAT PHILIP MORRIS AND BRITISH AMERICAN TOBACCO ARE ALREADY SETTING UP POTENTIAL BLACK MARKET MECHANISMS IN MEXICO BY BUYING OUT MEXICAN TOBACCO COMPANIES.

THE FOURTH PRINCIPLE SAYS ``STATUTORY RESTRICTIONS ON ADVERTISING AND PROMOTION AS WELL AS ONGOING FDA AUTHORITY TO RESTRICT ADVERTISING AND PROMOTION IN THE FUTURE.''

I WOULD RESPOND TO THIS FIRST BY COMMENDING THE PRESENT FDA REGULATIONS AND ASK FOR FULL-FUNDING TO SEE THAT THEIR IMPLEMENTATION IS GUARANTEED.

STUDIES IN THE UNITED KINGDOM, THE NETHERLANDS, AND SCANDINAVIA, AS WELL AS FINLAND, HAVE SHOWN THAT SEVERE RESTRICTIONS ON ADVERTISING CIGARETTES TO YOUTH HAS NOT REDUCED THE PREVALENCE OF SMOKING IN YOUNGSTERS. THEREFORE, TO OBTAIN BANS ON ADVERTISING AT THE EXPENSE OF PROMISING SOME LIABILITY REDUCTION OR LIMITATION TO THE TOBACCO INDUSTRY IS NOT WORTH IT.

THE TOBACCO LOBBYISTS HAVE CONVINCED MOST MEMBERS OF CONGRESS THAT THE ONLY WAY TO HAVE A RESTRICTION ON ADVERTISING IS TO HAVE THE INDUSTRY REWARDED BY SOME KIND OF A TRADE THAT PRODUCES IMMUNITY TO LAWSUITS OR SOME LIMITED LIABILITY ON THAT SCORE.

ALTHOUGH I'M A GREAT BELIEVER OF FREE SPEECH AND THOROUGHLY SUPPORT THE FIRST AMENDMENT, I DO KNOW THAT THE COURTS HAVE TREATED INDIVIDUAL FREE SPEECH DIFFERENTLY THAT THEY HAVE COMMERCIAL FREE SPEECH.

IT IS CLEAR THAT THE COURTS HAVE DECIDED THAT COMMERCIAL SPEECH IS NOT PROTECTED UNDER THE FIRST AMENDMENT IF IT IS LYING SPEECH OR ILLEGAL SPEECH.

A TOBACCO AD THAT SAYS ``ALIVE WITH PLEASURE'' WHEN IT SHOULD BE SAYING ``DYING IN AGONY'' IS LYING SPEECH. IT IMPLIES A HEALTH BENEFIT WHICH IS UNTRUE AND I BELIEVE THE COURTS WOULD UPHOLD A NARROW BAN ON SUCH ADVERTISING WHEN IT IS DIRECTED TO CHILDREN. AND MOST OF THE OBJECTIONABLE ADVERTISING THAT WE BELIEVE IS TARGETED TO CHILDREN IS CERTAINLY TARGETED ILLEGALLY TO THOSE UNDER THE SMOKING AGE.

I THINK EVERYONE WOULD AGREE THAT THE FIRST AMENDMENT PROTECTS THE ADVERTISING OF CIGARETTES IN BARS. I THINK EVERYONE WOULD AGREE ALSO THAT THE FIRST AMENDMENT DOES NOT PROTECT THE ADVERTISING OF CIGARETTES IN THE CORRIDORS OF GRADE SCHOOLS. SOME PLACE BETWEEN THOSE TWO EXTREMES THERE IS A NARROW BAND ON THE BANNING OF ADVERTISING THAT IS DELETERIOUS TO CHILDREN.

ALTHOUGH I AM NO LAWYER, JUDGING BY THE WAY THE COURTS HAVE IN THE PAST TREATED COMMERCIAL SPEECH IN REFERENCE TO ITS DELETERIOUS EFFECTS ON CHILDREN, I THINK THE ADVERTISING RESTRICTIONS ARE SUFFICIENTLY TIED TO THE GOAL OF PREVENTING UNDERAGE YOUNGSTERS FROM SMOKING TO BE UPHELD.

BUT IT ALSO IS OBVIOUS THAT EVEN IF THE INDUSTRY WERE TO HAVE GRANTED WAIVERS, THEY HAVE NO POWER TO WAIVE THOSE RIGHTS FOR OTHER PARTIES SUCH AS THOSE WHO OPERATE BILLBOARD ADVERTISING OR RUN CONVENIENCE STORES THAT SELL CIGARETTES. BEING WARY OF TOBACCO INDUSTRY BEHAVIOR, IT WOULD NOT BE IMPOSSIBLE TO IMAGINE THE TOBACCO INDUSTRY SIGNING A WAIVER WHILE ENCOURAGING THIRD PARTIES TO SUE THE GOVERNMENT USING THE FIRST AMENDMENT AS DEFENSE.

IT IS ALSO POSSIBLE THAT IF THERE WERE NEGOTIATED ADVERTSING BANS IN RETURN FOR LIMITED LIABILITY, THE COURTS COULD FIND THAT SUCH LIMITATION OR A CAP MIGHT BE CONSTRUED TO INTERFERE WITH A PLAINTIFF'S CAUSE OF ACTION AS TAKING AWAY A VESTED RIGHT UNCONSTITUTIONALLY.

THE FIFTH PRINCIPLE IS ``FUNDING FOR TOBACCO PREVENTION AND TREATMENT PROGRAMS, INCLUDING COUNTER-ADVERTISING, PROFESSIONAL AND PUBLIC EDUCATION, AND SCIENTIFICALLY SOUND SMOKING CESSATION SERVICES.''

WE HAVE TOGETHER AND INDIVIDUALLY REFRAINED FROM SUGGESTING HOW ANY MONIES RESULTING FROM LEGISLATION BE SPENT. WE DO BELIEVE HOWEVER IN ONE FIRM PRINCIPLE AND THAT IS BEFORE THOSE MONIES ARE SPENT FOR ANYTHING ELSE, THEY SHOULD BE SPENT TO AID THE VICTIMS OF THE TOBACCO INDUSTRY.

THAT WOULD INCLUDE PROGRAMS OF PREVENTION, COUNTER-ADVERTISING TO YOUNGSTERS, AND SMOKING CESSATION PROGRAMS FOR THE 45 MILLION NICOTINE ADDICTS IN AMERICA - 82% OF WHOM WERE ADDICTED AS CHILDREN AND ALL OF WHOM WERE ADDICTED AT A TIME WHEN THE TOBACCO INDUSTRY SAID THAT THEIR PRODUCTS WERE NOT HARMFUL TO HEALTH AND THAT NICOTINE WAS NOT ADDICTIVE.

SUCH SPENDING SHOULD INCLUDE BEHAVIORAL RESEARCH THAT WOULD HELP US UNDERSTAND JUVENILE USE OF TOBACCO BETTER THAN WE DO AS WELL AS IN FURTHER STUDY OF THE EPIDEMIOLOGY OF ALL OF THE MALADIES CAUSED BY THE USE OF TOBACCO.

I CANNOT AGREE WITH MR. GINGRICH'S STATEMENT WHEN HE SAID, ``I THINK WE OUGHT TO GIVE BACK TO THE TAX PAYERS EVERY PENNY OF NEW REVENUE FROM TOBACCO.'' THAT'S AN OPINION THAT COULD BE DISCUSSED ONLY AFTER THE VICTIMS OF TOBACCO ARE CARED FOR.

THE IDEA OF USING ANTI-TOBACCO MOMENTUM TO ATTACK THE PROBLEM OF THE USE OF ILLEGAL DRUGS IS INAPPROPRIATE AND LOSES SIGHT OF THE COMPARATIVE THREATS OF TOBACCO VERSUS HARD DRUGS.

LOOKING AT MORTALITY STATISTICS ALONE, TOBACCO KILLS 430,000 PEOPLE PER YEAR PREMATURELY WHILE ALL POSSIBLE DEATHS ASSOCIATED WITH ILLEGAL DRUGS ACCOUNT FOR 20,000 DEATHS PER YEAR, A RATIO OF MORE THAN TWENTY TO ONE.

LET ME STRESS THAT NICOTINE DEPENDENCE IS A CHRONIC DISEASE. I AM VERY MUCH CONCERNED ABOUT THE 45 TO 50 MILLION NICOTINE DEPENDENT PEOPLE, 70% OF WHOM WISH TO QUIT, BUT ONLY 3 OR 4% SUCCEED EACH YEAR.

THERE ARE PERMANENT BRAIN CHANGES IN THE CHRONIC SMOKER. THUS, IT IS IMPORTANT TO SUPPORT THE EX-USER AS WELL. CLINICAL SKILLS ARE NEEDED IN THIS SO IT IS NOT ALWAYS A MATTER OF CRISIS MANAGEMENT - THAT IS HELPING SYMPTOMATIC USERS.

NO FUNDS SHOULD BE ALLOCATED TO THE FLY-BY-NIGHT SMOKING CESSATION PROGRAMSN WHICH WILL ERUPT IF MONEY IS AVAILABLE. FUNDS SHOULD BE CONFINED TO SUPPORT FOR SCIENTIFICALLY SOUND AND PROVEN INTERVENTIONS AND SHOULD FUND ONLY THOSE PHARMACEUTICALS APPROVED BY FDA.

OUR SIXTH PRINCIPLE IS ``FUNDING BIOMEDICAL AND BEHAVIORAL RESEARCH ON PRVENTION AND TREATMENT AS WELL AS ON ADDICTION AND TOBACCO-RELATED ILLNESSES.''

THIS IS IN LINE WITH PREVIOUS STATEMENTS THAT THE VICTIMS OF TOBACCO SHOULD BE THOSE FIRST HELPED WITH ANY AVAILABLE FUNDS. BUT IT ALSO MEANS THAT RESEARCH INTO THESE PROBLEMS SHOULD HAVE HIGH PRIORITY AS WELL BEFORE ANYTHING ELSE OF ANY NATURE IS PAID FOR.

WE NEED NOT ONLY BIOMEDICAL RESEARCH, BUT ALSO BEHAVIORAL RESEARCH ON PREVENTION AND TREATMENT, BUT WE ALSO NEED A TREMENDOUS AMOUNT OF WORK ON ADDICTION AND ITS RELATED PROBLEMS AS WELL AS ON THE EPIDEMIOLOGY OF TOBACCO-RELATED ILLNESSES.

THERE ARE MANY KINDS OF RESEARCH AND IT IS ESSENTIAL THAT MONIES BE ALLOTTED TO EITHER CDC OR NIH TO CONTINUE THE ``ASSIST'' PROGRAM (AMERICA STOP SMOKING INTERVENTION STUDY FOR CANCER PREVENTION), WHICH MUST BE VERY EFFECTIVE BECAUSE THE TOBACCO INDUSTRY HATES IT SO MUCH. ALSO, THE AGENCY FOR HEALTHCARE POLICY AND RESEARCH (AHCP&R) REQUIRES SOME HELP AS IT SEEKS TO IMPROVE AND KEEP GUIDELINES UP TO DATE IN REFERENCE TO SMOKING.

OUR SEVENTH PRINCIPLE IS ``ELIMINATION OF EXPOSURE TO SECONDHAND SMOKE IN THE WORKPLACE AND IN PUBLIC PLACES.

EXPOSURE TO ENVIRONMENTAL TOBACCO SMOKE IN THE WORKPLACE IS ONLY ONE OF MANY ENVIRONMENTS THAT ARE ESSENTIAL TO PUBLIC HEALTH.

ONE PUBLIC HEALTH CONCERN IS THE EXPOSURE OF THE DEVELOPING BABY IN UTERO AND THE EXPOSURE OF GROWING CHILDREN TO THE ENVIRONMENTAL TOBACCO SMOKE OF SMOKING PARENTS. EVIDENCE MOUNTS BY THE DAY IN THIS LATTER CATEGORY, ESPECIALLY FOR CHILDREN WHO ALREADY HAVE A RESPIRATORY ILLNESS SUCH AS ASTHMA. TO EXPOSE ASTHMATIC CHILDREN TO ENVIRONMENTAL TOBACCO SMOKE IS NOTHING SHORT OF CHILD ABUSE. BUT EVEN THOSE YOUNGSTERS WHO ARE OTHERWISE PERFECTLY ``NORMAL'' HAVE SEVERE DELETERIOUS EFFECTS FROM EXPOSURE TO SMOKING PARENTS.

S.1415 TAKES A STEP BACKWARD FROM THE ORIGINAL ``SETTLEMENT''. IT WOULD PERMIT STATES TO OPT OUT OF THE FEDERAL ETS STANDARDS. THIS IS UNACCEPTABLE.

S. 1415 ALSO MOVES AWAY FROM THE STANDARDS OSHA ESTABLISHED IN 1994 IN SEVERAL PARTICULARS.

THE INDOOR AIR QUALITY IAQ (A STANDARD UNDER OSHA WOULD COVER RESTAURANTS, BARS, AND HOTELS.) TITLE 5 IN S.1415 WOULD EXEMPT THEM. CERTAINLY RESTAURANTS SHOULD NOT BE EXEMPT, ALTHOUGH WOULD BE DIFFICULT TO ENFORCE NON-SMOKING RULES IN BARS AND HOTELS, CASINOS, BINGO PARLORS, TOBACCO SHOPS AND PRISONS, I QUESTION THESE EXEMPTIONS .

FOR EXAMPLE, I HAVE CONSULTED WITH THE MEDICAL DIRECTOR OF THE MINNESOTA STATE PRISON SYSTEM, WHICH HAS NOW BEEN SMOKE-FREE FOR NINE MONTHS. ALTHOUGH THE TRANSITION WAS DIFFICULT, IT DOES NOT PRODUCE MORE PROBLEMS WITH INMATES THAN DO MANY NON-SMOKING ISSUES. CERTAINLY THE HEALTH OF INMATES HAS BEEN IMPROVED.

THE OSHA IAQ STANDARD REQUIRED ENCLOSED VENTILATED AREAS UNDER NEGATIVE PRESSURE - THAT IS TO SAY SEPARATE ROOMS FOR SMOKING TREATED IN A SPECIAL WAY. THEY ARE ELIMINATED IN S.1415. THE OSHA IAQ STANDARDS APPLIED TO ``ALL INDOOR NON-INDUSTRIAL WORK ENVIRONMENTS INDUSTRIAL WORK ENVIRONMENTS'' WHERE AS S.1415 APPLIES ONLY TO PUBLIC FACILITIES ACCORDING TO A VERY NARROW DEFINITION.

THE EIGHTH PUBLIC HEALTH PRINCIPLE IS NO PREEMPTION OF STRONGER STATE ND LOCAL LAWS. IT IS WELL-KNOWN THAT STATE AND LOCAL LAWS ARE ALWAYS TOUGHER THAN FEDERAL LAWS AND THE TOBACCO INDUSTRY HAS SPENT MILLIONS AT THE GRASS ROOTS LEVEL TRYING TO INTERVENE IN SUCH LEGISLATION BECAUSE IT IS STIFFER THAN A FEDERAL STANDARD.

ABSOLUTE ATTENTION SHOULD BE PAID IN EVERY INSTANCE THAT NOTHING THAT IS STIPULATED IN FEDERAL LEGISLATION PREEMPTS LOCAL OPTIONS IF THEY ARE BETTER FOR THE PROTECTION OF THE PUBLIC'S HEALTH.

THE NINTH PRINCIPLE IS: FULL DISCLOSURE OF ALL TOBACCO DOCUMENTS.

THIS IS ONLY AN APPEAL FOR JUSTICE. CONGRESS SHOULD NOT CONTRIBUTE TO A COVER UP SUCH AS THAT PROVIDED BY S.1415 WHERE A REPOSITORY IS PROVIDED FOR BUT ACCESS BECOMES UNUSUAL AND DIFFICULT, IF NOT IMPOSSIBLE UNDER SOME CIRCUMSTANCES.

THE FINAL PRINCIPLE IS: NO SPECIAL LIABILITY PROTECTIONS FOR THE TOBACCO INDUSTRY.

I SAID EARLIER THAT WE WERE IN CONFORMITY WITH THE PRINCIPLES THAT THE PRESIDENT HAS ESTABLISHED. THAT IS TRUE EXCEPT FOR THE FACT THAT WE HAVE NEVER DISCUSSED LIABILITY WITH THE WHITE HOUSE BECAUSE THEY HAVE ELECTED NOT TO DISCUSS LIABILITY WITH ANYBODY UNTIL ALL OTHER ASPECTS OF THE BILL HAVE BEEN SETTLED.

THE LIABILITY PORTION OF S.1415 IS THE MOST EGREGIOUS TO THE PUBLIC HEALTH COMMUNITY.

INDEED, IF THERE WERE ONE SEGMENT WHICH I THINK MIGHT HAVE BEEN WRITTEN BY THE TOBACCO INDUSTRY, IT IS THIS ONE.

THE FACT THAT THE WHITE HOUSE TAKES POSITION ON THIS UNTIL EVERYTHING ELSE IS SETTLED MAKES IT DIFFICULT TO ADDRESS THIS ISSUE, BUT I CAN TELL YOU THAT IF THERE WERE EVER TO BE AN ISSUE WHICH DID SEPARATE THE PUBLIC HEALTH COMMUNITY, THIS IS IT. AND IF EVER THERE WERE ANYTHING ON WHICH WE FEEL VERY STRONGLY AT THE PRESENT TIME, IT IS THIS.

IN VIEW OF THEIR BEHAVIOR, THERE IS NO REASON IN THE WORLD WHY WE OF THE PUBLIC HEALTH COMMUNITY SHOULD AGREE TO, OR THIS CONGRESS SHOULD FACILITATE, ANYTHING WHICH GRANTS THIS ROGUE INDUSTRY IMMUNITY OR LIMITED LIABILITY.

LET ME SAY THAT AS OF THE DATE THAT I PREPARED THIS PRESENTATION, THE BILL IN QUESTION, S.1415, HAD NOT BEEN FULLY ASSEMBLED IT IS QUITE POSSIBLE THAT SOME OF THE ISSUES THAT I AM CONCERNED ABOUT MIGHT HAVE ALREADY BEEN RESOLVED, BUT IT HAS NOT BEEN POSSIBLE TO GET THE LATEST VERSION OF THE BILL FROM THOSE WHO GUARD ITS SAFEKEEPING AT THE MOMENT.

IT IS THIS PORTION OF THE BILL THAT LED TO THE WELL- ORCHESTRATED DEPARTURE OF MR. GOLDSTONE AND HIS FRIENDS FROM WHAT HE STILL ERRONEOUSLY THOUGHT WERE TOBACCO SETTLEMENT TALKS.

MR. GOLDSTONE'S SPEECH - SOUNDED LIKE A LAST MINUTE, STRAW-THAT-BROKE-THE CAMEL'S BACK BURDEN, NECESSITATING HIS ADDRESSING THE PUBLIC.

IF THIS IS SO, IT'S HARD TO JUSTIFY HIS RESERVING THE PRESS CLUB THREE WEEKS BEFOREHAND, BUT HE HAS TO BE CONGRATULATED FOR A MARVELOUS ORCHESTRATION AND THE ABILITY TO LEAVE THE IMPRESSION BEHIND THAT THIS BILL IS TOUGH ON TOBACCO AND EASY ON PUBLIC HEALTH, ESPECIALLY WHEN JUST THE OPPOSITE IS TRUE.

I THINK THE UNIFORM REACTION TO MR. GOLDSTONE'S SPEECH WAS ``SO WHAT?''

IT DOES MAKE IT EASIER TO TALK ABOUT LIABILITY BECAUSE THERE IS NOW NO TRADE ISSUE, SUCH AS A BAN ON ADVERTISING TO CHILDREN IN RETURN FOR LIMITED LIABILITY.

IN S.1415, THERE SHOULD BE A MORE HONEST AND INCLUSIVE DEFINITION OF WHAT CONSTITUTES A CIGARETTE MANUFACTURING COMPANY. THE PRESENT DEFINITION EXCLUDES CONGLOMERATES, PARENT COMPANIES AND INTERNATIONAL HOLDINGS.

MATTERS THAT DESERVE YOUR ATTENTION ARE:

THE TERMINATION OF EXISTING LAWSUITS. THIS INCLUDES ALL PRESENT ATTORNEYS GENERAL OR OTHER STATE ACTIONS, INCLUDING THE GROUD-BREAKING CASE IN MINNESOTA NOW UNDER TRIAL. IT INCLUDES ALL SIMILAR ACTIONS, INCLUDING SUITS BROUGHT BY LOCAL OR REGIONAL GOVERNMENTS SUCH AS NEW YORK CITY AND CALIFORNIA. IT ALSO INCLUDES ALL COSTANO CIVIL ACTIONS.

THERE ARE RESTRICTIONS ON REMAINING PRESENT LAWSUITS AND ON FUTURE LAWSUITS. JUST LIKE THE SO-CALLED SETTLEMENT OF JUNE 20, THE BILL PROVIDES FOR A SO-CALLED GLOBAL LIABILITY CAP CURRENTLY SET TO BE MAXIMIZED AT 6.5 BILLION ANNUALLY INSTEAD OF 5 BILLION.

EVEN SO, THE PAYMENTS ARE NO LARGER SO THERE IS LITTLE RISK TO SHAREHOLDERS, AND THERE ARE NO FINANCIAL INSURANCE REQUIREMENTS IN REFERENCE TO GUARANTEES BY PARENT CORPORATIONS, ESCROW FUNDS, COLLATERAL AVAILABLE FOR PLEDGE, ET CETERA. THERE IS ALSO NO MECHANISM TO ADJUST THE CAPS IF THE EXPERIENCE WITH LIABILITY SUITS WOULD MAKE THAT A SENSIBLE THING TO DO.

THE BILL STILL PROTECTS THE TOBACCO PRODUCT MANUFACTURERS RELATIONSHIPS WITH PARENT CORPORATIONS, AFFILIATES, FOREIGN PARTNERS, AND SO FORTH. ALL ARE FREE OF LIABILITY. THIS IS ONE OF THE THINGS THE INDUSTRY HAS WANTED MOST OF ALL BECAUSE IT PROTECTS THEIR FOREIGN ASSETS AND ALLOWS THEM TO SHED CROCODILE TEARS OVER THE 8% OF THE GLOBAL TOBACCO ECONOMY WHICH IS REPRESENTED BY THE UNITED STATES.

THERE IS FOR MANY INVOLVED ABSOLUTE IMMUNITY. THIS IS UNACCEPTABLE AND INTOLERABLE.

JUST AS IN THE SETTLEMENT AGREEMENT IN JUNE, THERE IS IMMUNITY FOR INSURANCE COMPANIES UNLESS THE SUITE IS BROUGHT BY TOBACCO MANUFACTURERS.

VERY SERIOUSLY THERE IS PREEMPTION OF STATE CAUSES OF ACTION, WHICH I HAVE ALREADY ALLUDED TO A FEW MOMENTS AGO.

IN SHORT, S.1415 IS A WINDFALL FOR THE TOBACCO INDUSTRY. IT MAY CHOOSE ITS OWN FORM, SUCH AS SHIFTING FROM A STATE COURT TO A FEDERAL COURT. IT ALLOWS THE INDUSTRY TO DICTATE THROUGH LITIGATION ABOUT WHICH STATE LAWS SHOULD APPLY IN A GIVEN INSTANCE. FINALLY, EXISTING FEDERAL CAUSES OF ACTION, SUCH AS ANTITRUST, RICO PROVISIONS ARE PREEMPTED.

THERE IS A BAN ON ALL CLAIMS THAT HAVE TO DO WITH ADDICTIVENESS. WHICH IS REALLY THE BOTTOM LINE OF THE MOST. IT IS THE MOST EGREGIOUS EXCEPTION TO THE TOBACCO INDUSTRY OVER THE YEARS.

THERE ARE PROBLEMS WITH EVIDENCE IN REFERENCE TO EXCLUSION AND NON-DISCOVERABILITY IN REFERENCE TO ANY TOBACCO PRODUCT WHICH HAS A REDUCED RISK.

THERE ARE MANY MORE RELATIVELY SMALL PROBLEMS IN THEMSELVES, BUT IN THE AGGREGATE PLACES SEVERE LIMITATIONS ON WHAT CITIZENS CAN CLAIM BY DUE PROCESS.

AGAIN, I REMIND YOU I HAVE NO IDEA HOW THE WHITE HOUSE FEELS ABOUT ANY OF THIS BECAUSE THEY HAVE NOT DISCUSSED LIABILITY.

MANY PEOPLE WHO ARE PUSHING S.1415 CLAIM THAT IT IS ONLY A BILL THAT DEALS WITH CAPS. BUT THERE ARE STILL A NUMBER OF OTHER LIABILITY PROBLEMS FOR US THAT ARE ADVANTAGEOUS TO THE TOBACCO INDUSTRY THAT I DO NOT BELIEVE ARE FAIR: FEDERALIZATION OF TOBACCO LITIGATION, PREEMPTION OF EXISTING CAUSES OF ACTION, BURDENS OF DISCOVERY FOR THE PLAINTIFF, RESTRICTIONS ON EVIDENCES AVAILABLE TO PLAINTIFFS.

EVEN IF ALL OF THESE MATTERS ARE CARED FOR, THE CAPS THEMSELVES DO PRESENT A PROBLEM. THE INDUSTRY CAN AFFORD TO PAY CONSIDERABLY MORE THAN THE PAYMENT LEVELS. THE PASS THROUGH COST TO CONSUMERS THROUGH PRICE INCREASES ARE STILL THERE, THE ANTITRUST EXEMPTION IS STILL THERE, THE TAX-DEDUCTIBILITY OF ALL COSTS IS STILL THERE, THE WINDFALL TO THE TOBACCO INDUSTRY BECAUSE OF REDUCTIONS IN ADVERTISING AND LEGAL EXPENSES ETC. ALL OF THIS IS SECURITY FOR THE TOBACCO INDUSTY WHICH WILL AFFECT THE STOCK PRICES BENEFICIALLY.

PLEASE REMEMBER THAT WHENEVER TOBACCO STOCKS GO UP, THAT'S BAD FOR PUBLIC HEALTH AND VICE VERSA.

THE CAPS DISCRIMINATE AGAINST FUTURE CLAIMANTS, GIVING THE ADVANTAGE TO PRESENT ONES, THE INDUSTRY CAN SETTLE WITH FAVORITE PLAINTIFFS AND THEIR ATTORNEYS AND THROUGH THE DELIBERATE DELAY OF PAYMENT FOR SMALLER SETTLEMENTS, THE SECURITY WHICH IS PURCHASED BY THE CAPS WILL ALLOW THE CIGARETTE COMPANIES TO SEPARATE THEIR DOMESTIC TOBACCO SUBSIDARARIES WHILE AT THE SAME TIME PROTECTING THE ASSETS OF PARENT CORPORATIONS AGAINST LIABILITIES. THERE ARE ALL SORTS OF WAYS TO PLAY WITH THE BANKRUPTCY ISSUE. ALTHOUGH THERE ARE TRAPS IN THAT FOR THE TOBACCO INDUSTRY INTO WHICH I ONLY WISH THEY MIGHT FALL.

ONE OF THE ETHICAL AND MORAL ISSUES THAT CONTINUES TO PLAGUE ME IS THAT IF CONGRESS LETS TOBACCO NOT ADHERE TO THE NORMAL ETHICAL AND MORAL STANDARDS OF OTHER CORPORATIONS, FOR SUITABLE PAYMENT, THE CONGRESS APPEARS WILLING TO BECOME A PARTNER WITH THIS RENEGADE INDUSTRY.

THE ENTIRE FRAMEWORK OF TOBACCO LEGISLATION HS CHANGED IN THE PAST FEW WEEKS. THE COMPANIES HAVE WALKED AWAY FROM THE TABLE, PROMISING TO OPPOSE EVEN THE COMMERCE COMMITTEE BILL. DON'T BELIEVE THEM WHEN THEY CRY THESE CROCODILE TEARS. IT'S A CLEVER ATTEMPT TO MAKE THE COMMERCE COMMITTEE BILL LOOK STRONG WHEN IT'S NOT.

AND MANY TOBACCO DOCUMENTS RECENTLY HAVE BEEN MADE PUBLIC. THERE WILL BE A STEADY DRUMBEAT OF NEWS STORIES NOW ABOUT SUPPRESSED SCIENCE AND PERJURY.

YOU NEVER NEEDED TOBACCO INDUSTRY PERMISSION TO ACT. BUT BOTH OF THESE EVENTS SHOULD FREE THE CONGRESS TO GET THE STRONGEST POSSIBLE BILL TO PROTECT CHILDREN AND LIMIT THE DAMAGE TO THE HEALTH OF THE NATION.

IN CLOSING, LET ME GIVE A SURGEON GENERAL'S WARNING TO CONGRESS: THIS IS THE BEST CHANCE FOR WINNING THE TOBACCO WARS FOR A GENERATION. THE HEALTH OF FUTURE GENERATIONS DEPENDS ON YOUR EFFORT.

YOU HAVE TO GET THIS ONE RIGHT.