The Tobacco Wars

1982 Excise profits

Congress doubles the excise tax on cigarettes to 16 cents a pack. The tobacco companies enter a lip-service protest–claiming it discriminates against smokers, who are poorer on average than nonsmokers. They then use this cover to boost the price of cigarettes at a rate never before contemplated. Their profit margin soars to well over 20 percent, twice the average return on equity in corporate America.

1984 The Waxman cometh

After a bitter struggle, California Rep. Henry Waxman engineers a bill that forces tobacco companies to list their ingredients and toughen the warning labels on cigarettes. The bill marks a turning point in the industry’s hold on the federal legislative machinery; smoking is no longer an issue that can embarrass a congressperson. A Philip Morris attorney dubs Waxman “a very dangerous adversary.” Nonetheless, the bill does nothing to restrict the manufacture or marketing of cigarettes.


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