by Tracy Robinson

Politically outsmarted by President Clinton once again, Republicans are all over the map on the tobacco settlement. Sen. John McCain got a settlement bill worth $516 million passed nearly unanimously through the Commerce Committee. This past Sunday, Sen. Orrin Hatch, chairman of the Judiciary Committee, said the McCain bill would cause cigarette companies to go bankrupt and encourage a black market in cigarettes. Even so, Hatch doesn't oppose a settlement, but rather is advancing his own $398 billion deal which is closer to the agreement the states worked out last year. Assistant Majority Leader Don Nickles of Oklahoma is advocating a plan that would add more targeted anti-teen smoking and anti-drug legislation to tobacco legislation. In the House, Newt Gingrich called the McCain bill a "very liberal, big government, big bureaucracy bill," but he also supports a settlement, rather than leaving the tobacco companies alone.

Republican governors are behaving just as badly, although they are better organized. They want 55 percent of any final deal passed by Congress, and they're lobbying hard to get it. While in Washington to attend the National Governors' Association's annual meeting in February, the governors were told by Sen. Nickles that money from any tobacco settlement -- which, of course, is only a national issue due to the numerous lawsuits the state attorneys general filed against "Big Tobacco" -- would likely go exclusively to the federal government. After the meeting, NGA Chairman George Voinovich of Ohio, a Republican, was quoted by the Washington Post as saying, "There's a strong feeling that it's our money," and John Engler, the Republican governor of Michigan, said, "The governors are over the top about the White House building all kinds of spending dreams on our tobacco money." Wisconsin's Gov. Tommy Thompson complained, "They're going to take 50 percent of the money... and then take 30 percent and tell us how to spend that and allow us only 20 percent unfettered. That, to me, is not a good idea."

The governors should not be surprised by the proclivity of Congressmen to spend all the money they can get their hands on. After all, the governors have been doing the same thing for years, and tobacco has long been a convenient scapegoat at the state level. Numerous Republican governors -- including Christine Todd Whitman in New Jersey, George W. Bush in Texas, Pete Wilson in California, Mike Leavitt in Utah, and Lincoln Almond in Rhode Island -- have proposed or supported state legislative efforts to raise cigarette taxes to offset tax cuts or fund state spending. Even a reformer like Wisconsin's Thompson, who has generally held the line on other forms of tax increases in his state, recently advocated a tobacco tax increase of 5 cents a pack over the state's current 44 cents -- and let it be known that he could be persuaded by state legislators to go even higher.

Also like Congress and the President are proposing to do, the governors have applied state tobacco taxes to fund all sorts of programs, rather than primarily use the funds for health care for smokers or for anti-teen smoking campaigns. Last year, Arne Carlson, the Republican governor of Minnesota, proposed a ten cents per pack increase to raise a half a billion dollars to subsidize a new stadium for the Twins, renovate the Metrodome for the Vikings, and put the remainder toward a new hockey arena for an NHL team -- at a time when his state has enjoyed budget surpluses five years running. In Michigan, Gov. Engler got a tripling of the state's tobacco tax -- from 25 to 75 cents a pack -- enacted in 1995 to help pay for education. Since then, cigarette smuggling across state lines has skyrocketed, resulting in an estimated loss of $17 million a year in school funding. To combat the revenue shortfall, Engler proposed a measure that required tax stamps to be attached to all cigarettes packs sold in the state. With Michigan's legislators evidently forgetting the cause of the Boston Tea Party, the proposal passed overwhelmingly, with only one state legislator voting against it.

So it seems Republicans on both the state and national level have caved in to the idea of tobacco as an easy fund-raiser. After years of Republicans perfecting this technique in the states, it should not be surprising that no Congressional Republicans are standing up to President Clinton and saying that enough is enough -- tobacco shouldn't be scapegoated and driven out of business with confiscatory taxation.

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