Tobacco industry's TV ad blitz pays off

The bust resembles something out of "NYPD Blue." Squad cars pull over a semi-truck barreling down a roadway. Cops swing open the trailer doors and shine flashlights inside to reveal hundreds of boxes. An officer grabs one, splits it open and out tumbles....

Cigarettes?

A somber-voiced narrator explains: "America's law enforcement officers may soon face another problem -- a black market in cigarettes. Washington has proposed raising cigarette prices to $5 a pack, $50 a carton. Experts say this will create a huge black market."

The TV ad, one of several aimed at Congress by Big Tobacco, represented the industry's latest gambit in its two-fisted campaign to thwart anti-smoking legislation. Running in heavy rotation in 40 to 50 major media markets, including Las Vegas, the commercials carried a price tag of at least $30 million, with more than $535,000 pumped into three local TV stations.

The investment paid off Wednesday when opponents of a controversial Senate proposal to raise the cigarette tax by $1.10 a pack killed the bill on two parliamentary votes. One failed motion would have forced a final vote on the measure; the other would have waived a rule to permit the proposed $516 billion plan to exceed last year's balanced budget agreement.

Sens. Richard Bryan and Harry Reid, both D-Nev., voted with the majority.

Any number of factors, from the tacking on of frivolous amendments to good old-fashioned political favoritism, contributed to the bill's death. But while the cigarette debate has been snuffed out in Congress for now, lingering like so much secondhand smoke is whether the TV ads helped shroud the tobacco bill -- and the truth -- in a public relations haze.

Industry critics charge that predictions of a tax hike leading to cigarettes being hawked in alleyways were as dubious as previous claims made by tobacco companies about nicotine. Days before the final action, Bryan said Big Tobacco's ad campaign had distorted what he described as the true motivations behind a cigarette tax increase: to curb teen-age smoking and boost funding for anti-smoking programs and disease research.

Instead the industry sought to portray the bill, which would have cost tobacco companies $516 billion over 25 years, as another gross example of Washington's tax-and-spend mentality.

The ploy came as no surprise to Bryan, a member of the Commerce Committee that moved tobacco legislation to the Senate floor in April. "This is the same industry that, a few years ago, speaking before a congressional committee, said nicotine was not addictive," he said.

Disingenuous or not, the strategy worked. That much was evident by the bill's snail-like progress in the Senate, where lawmakers saddled it with unrelated add-ons -- such as an amendment to end the marriage tax penalty -- in what proved to be a successful push to kill the legislation. In trenchant postmortems Wednesday, both President Clinton and Sen. John McCain, R-Ariz., sponsor of the bill, faulted the tobacco industry's ad frenzy for the bill's death.

Bill Novelli is president of the Campaign for Tobacco-Free Kids, a Washington, D.C.-based organization backed by the American Cancer Society, American Heart Association and dozens of other health groups. His group mounted a modest, and ultimately futile, counterattack on Big Tobacco, airing TV and radio ads in several markets nationwide.

While careful not to overstate the impact of TV ads on the debate, Novelli said the tobacco industry's message of "this is big government on the loose" resonated with some voters. "It ... turned a smoking issue into a tax issue for a certain segment of the population."

Estimates differ on how much the tobacco industry's biggest hitters -- Brown & Williamson, Lorillard, Philip Morris, R.J. Reynolds and the United States Tobacco Co. -- dumped into their TV, radio and newspaper ad assault. The figures most often cited range from $50 million to $100 million, McCain spokeswoman Nancy Ives said.

Scott Williams, spokesman for BSMG Worldwide, the Washington, D.C., company that worked with the tobacco industry on the ads, refused to confirm the numbers. He also could offer no specifics on the Las Vegas market.

Local network affiliates were more forthcoming. Cigarette companies funneled more than $535,000 to three Las Vegas stations during the two-month campaign that began in mid-April and wound down this week. (A fourth station declined to provide its take.) Two stations garnered roughly $30,000 a week during the blitz, a "sizable" amount by industry standards, said Julie Neil, media director of Outback Media in Las Vegas.

The series of 10 ads was made costlier by tobacco companies running spots during morning, evening and nighttime news programs, coveted slots for advertisers. The commercials, airing four to eight times a day on KVBC Channel 3, KLAS Channel 8 and KTNV Channel 13 and about twice a day on KVVU Channel 5, hammered away at three points: a tax increase would jack up the price of cigarettes, trigger a black market and cause tobacco companies to go belly-up.

When asked about the "$5 a pack, $50 a carton" figures quoted in the industry's ads, Williams said the prices referred to the "huge markups" wholesalers and merchants would have slapped on cigarettes.

The cost increase would have in turn given rise to a black market, with cigarettes trucked up from Mexico or sporadically taken straight to the streets by opportunistic U.S. distributors -- giving minors even easier access to the products, Williams said. In Canada, which hiked its tobacco tax earlier this decade, law enforcement has struggled to control smuggling of cigarettes into the country, he noted.

Moreover, the losses in market share coupled with the additional $516 billion tobacco companies would have ponied up under the Senate bill would have left them wallowing in bankruptcy, Williams said. As a result, both the tax hike proposal and the rejection by Congress and the Clinton administration of the $368 billion settlement reached a year ago between Big Tobacco and states' attorneys general reeked of exploitation, he said.

Williams characterized the failed bill as more about money than youngsters, calling it "an attempt to get an enormous amount of new revenue from an industry that's not popular."

Anti-smoking advocates agreed that, a tax being a tax, the cost of cigarettes would have gone up. But they put the price at closer to $3.25 a pack, an increase of about $1.10 -- an amount in step with the proposed tax hike that to tobacco opponents would have yielded fair recompense for smoking-related health-care costs, which are expected to top $13 billion this year.

In that respect, the industry's markup claims smacked more of scare tactics than reasoned conjecture, according to David Christy, president of the Nevada Tobacco Prevention Coalition.

Christy pointed to California, which in 1988 imposed a 25-cent tax increase on a pack of cigarettes. Tobacco companies fought the price hike proposal using similar doomsday rhetoric, with a forecast of soaring costs and a budding black market. Neither materialized, said Christy, who worked in the Department of Health Services in Tulare County, Calif., at the time.

In addition, it's unlikely that American smokers, hooked on the flavor of Marlboros, Camels and Newports, would suddenly turn to lower-quality Mexican cigarettes, argued Dan Geary, Nevada organizer of the Campaign For Tobacco-Free Kids. For smuggling to occur, U.S. tobacco companies would need to over-export cigarettes to other countries, he said.

As for the claim that a tax increase would have thrown tobacco companies into insolvency, the bill's death might end up costing the industry even more money. Ives noted that the tab for settling pending lawsuits brought by 36 states to recover tobacco-related health-care expenses may run higher than $516 billion. Under the Senate proposal, states could have opted to drop litigation and collect tobacco money deposited in federal coffers.

According to Williams, Big Tobacco chose Las Vegas as one of its advertising battlegrounds because "Nevada has two senators like every other state." His answer revealed only part of the story. Nevada is second behind Kentucky in smokers per capita, with 28 out of every 100 residents lighting up. Not surprisingly, the Silver State boasts the nation's highest rate of death from lung cancer, which claims the lives of 1,100 residents each year.

Despite Nevadans' love of nicotine, local TV affiliates reported scant reaction to the tobacco industry's ads. Channel 13 Sales Manager David Madsen said the station "heard nothing" from viewers. Few calls trickled into the offices of Bryan and Reid, both of whom reported more response from tear-off cards tobacco companies distributed in grocery and convenience stores statewide that urged a "no" vote on the tax increase.

Yet judging from the reaction by the bill's Senate supporters and Clinton, who fingered "$40 million in unanswered advertising" for the proposal's demise, the TV campaign aided the tobacco industry's plight. If nothing else, Novelli said, the commercials provided political cover for lawmakers who wanted to remain friendly with the tobacco lobby under the guise of fighting higher taxes.

One who won't seek such protection is Bryan, who received $16,500 from tobacco political action committees from 1987-1997. After the Senate's latest political clash over cigarettes, Bryan said he will no longer accept tobacco contributions.

Reid, who received $12,000 from tobacco PACs over the same 10-year span and has accepted another $4,000 in 1998, will review future donations "on a case-by-case basis," spokeswoman Jenny Backus said.

archive