Source: The Nation, July 7, 1997, Page 5, op/ed Contact: Tobacco's Global Reach Could Filipino kids end up paying Mississippi's Medicaid bills? That could be one of the perverse outcomes of ongoing negotiations between state attorneys general, private trial lawyers, some public health advocates and the big tobacco companies, says Greg Connolly, head of the Massachusetts Tobacco Control Program. Under siege on legal, regulatory and public opinion fronts, Big Tobacco's search for a "global settlement" to resolve all present and future U.S. damage claims was still being hotly debated at press time. In broad outline, it appears the tobacco companies are offering to pay approximately $300 billion over twentyfive years; accept domestic marketing and advertising restrictions; perhaps agree not to challenge some degree of Food and Drug Administration regulation of nicotine; and perhaps guarantee some decrease in U.S. children's smoking rates. In exchange, the tobacco companies will receive substantial limitation on their liability for the ghastly harm they have perpetrated. Whatever the exact scheme, the tobacco companies will only agree to a deal that seriously compromises victims' rights and affords the balancesheet predictability they crave. And one more thing seems clear: Big Tobacco's overseas victims and operations will be excluded. This exclusion will enable the tobacco titans to carry out their longstanding global strategy to hold sales relatively steady in the United States and in the industrialized countries, while concentrating on increasing sales and market share in the Third World, Eastern Europe and the former Soviet Union. In the past decade, U.S. tobacco consumption dropped 17 percent but exports skyrocketed 259 percent. Philip Morris and R.J. Reynolds now sell more than twothirds of their cigarettes overseas, and nearly half of their 1996 profits came from foreign sales almost triple the proportion of a decade earlier. When the U.S. companies invade a market in the Third World or Eastern Europe, they not only capture market share from the sleepy national tobacco companies, they attract new smokers. After the Reagan/Bush threat of trade sanctions forced South Korea to open up its cigarette market to U.S. companies in 1988, smoking rates among male Korean teenagers rose from 18.4 percent to 29.8 percent in a single year. The rate among female teens more than quintupled, from 1.6 percent to 8.7 percent. The tobacco lords promote cigarettes in the Third World and Eastern Europe through an array of slick marketing techniques that target children, especially girls, often in ways that would not now be tolerated in the United States: free samples, TV advertising, celebrity spokespersons, sponsorship of youthoriented events like rock concerts and radio shows. Restrictions on sales practices in the United States, in the absence of global controls, may well spur the tobacco titans to intensify still further their marketing and corporate acquisition' strategies abroad. This prospect is what leads Connolly and others to fear that the tobacco companies' reimbursement of past Medicaid costs will come out of the pockets of children in the Philippines and elsewhere in the developing world and Eastern Europe at the expense of those children's health. International tobacco control activists are beginning to sound alarms about the damage a purely U.S. settlement could do to global health efforts. "To avoid doing public health harm," international activists said in a June 17 joint statement, "a settlement must set a worldwide floor on U.S. tobacco company practices, without limiting the ability of countries to require companies to exceed the global minimum standard." Already the World' Health Organization predicts that 10 million people will die annually from tobaccorelated disease by the 2020s, 70 percent of them in the developing world. Five years ago, a tobacco analyst with Sanford Bernstein, an investment management firm, told me that the tobacco multinationals' optimism about Eastern Europe is predicated on people in the region "not being well enough educated to have health concerns about smoking." Perhaps "fifty years from now they will realize that it is bad for you, and consumption will drop then," she added. A settlement that excludes the rest of the world would help condemn Eastern Europe and the Third World to this grim fate. ROBERT WEISSMAN Robert Weissman is editor of the Washinton, D.Cbased Multinational Monitor.