Vaping seems like something that anti-smoking advocates would love…right?
If someone offered an anti-smoking advocate something that resembled a cigarette, did not produce cancer-causing smoke, and allowed people to get a similar feeling to smoking – they’d likely be incredibly excited about the prospect.
Vaping offers this solution. Even though vaping offers a promising alternative to smoking, anti-smoking advocates do not seem excited. In many cases, they have done everything in their power to harm the reputation of vaping and eliminate its life-saving potential.
This strange relationship between anti-smoking advocates and vaping puzzles us more and more every day. Why wouldn’t they be in love with vaping?
We decided to take a look at the history of the anti-smoking movement and see why anti-smoking advocates have such an issue with vaping. What we found was both counterintuitive and shocking.
TOBACCO COMPANIES PAY STATES EACH YEAR BASED ON GROSS SALES
In 1998, 46 states signed a contract with the largest tobacco companies in the United States. This contract was known as The Master Settlement Agreement.
Each year, states were suing tobacco companies in huge numbers to recuperate some of the health care costs they were spending on treating smokers. The money received from tobacco companies was intended to create anti-smoking campaigns and smoking education programs.
The total amount the tobacco companies agreed to pay was in the billions. They agreed to pay out a portion of their profits every year to state governments. In theory, this money would be used to pay for health costs associated with smoking and anti-smoking advocacy campaigns.
12 of the states in the agreement did not want to wait to get the money promised to them by the tobacco companies. They purchased bonds and loans using the money guaranteed by tobacco companies as a guarantee.
The money they received was immediately thrown back into their state under the assumption they would be able to pay all of this money back when the bonds came due.
VAPORIZERS CHANGED EVERYTHING
When more and more people started vaping, tobacco sales declined quicker than expected. The states were expecting cigarette sales to drop at a rate of around 2 percent. Since 2000, they have dropped at an annual rate of 3.4%.
Because tobacco companies were making lower profits, states started receiving lower payouts. They had come to expect this money as part of their annual budget.
“If the decline goes to 6 or 7 percent, it will be very quick. I think that the first ones are probably five years away,” said Tom Metzold, a manager at Eaton Vance Investment Managers, referring to the bonds defaulting.
Wells Fargo analyst Bonnie Herzog expects that vaporizer sales will overtake combustible cigarettes within the next 10 years. Wells Fargo Securities predicts that tobacco sales will decline by 68 percent over the next decade while vaporizer sales are expected to increase to more than 13 times where they are now.
New Jersey, Ohio, and Virginia all announced they would be forced to take money from their reserves to cover the bond payments if the trend in smoking continues.
If sales of regular cigarettes do continue to decline at such a drastic pace and the bonds look like they will default…
WHAT ARE THE STATES TO DO?
The first option some states have attempted to implement is to ban vaping altogether or harm its reputation. By banning vaping and creating a stigma around the young industry, states could continue to receive the money they were expecting from traditional tobacco sales.
The California Board of Public Health tried this exact strategy. They launched a massive advertising campaign aimed at harming the reputation of vaping and e-cigarettes. Their ads were intended to make the public believe that vaping was just as harmful as tobacco use.
The second option that seems to be gaining prominence is to categorize vaporizers and e-cigarettes as tobacco products. If states allowed this to happen, they could receive money from vaporizer sales under the Master Settlement Agreement. They would also receive money from the taxes generated by vaporizer sales.
California tried this tactic as well. SB 140 was a bill intended to place vaporizers in the same category as cigarettes. Vapes would have been subject to the same taxes as cigarettes and would have been forced to comply with the Master Settlement Agreement terms.
Fortunately, the public rose up against this bill, and it was defeated. While this bill may have been shut down, more like it will come.
UNDERSTANDING THE RELATIONSHIP BETWEEN ANTI-SMOKING ADVOCATES AND VAPING
The unfortunate truth of the matter is simple. States need the money from big tobacco companies to continue to function properly and pay back the bonds they issued after signing the Master Settlement Agreement.
Most anti-smoking advocacy groups receive their funding from the state. Vaping harms the sales of tobacco and in turn, reduces the money states can earn. The states try to eliminate vaping or tax it like tobacco to recuperate the costs.
It is strange that organizations aimed at finding healthier alternatives to smoking would fight against one of the best alternatives available. Unfortunately, the money that states had to earn from tobacco sales are impairing their ability to see vaporizers as what they have the potential to be.
Do you know any anti-smoking advocates who oppose vaping? What do you make of the Master Settlement Agreement?
Let us know your thoughts over on the Veppo Facebook Page.