Tobacco’s Odds
in November’s Elections

By J. Glynn Loope

While all eyes in the tobacco industry have been on the presidential contenders, the key lies in Congress.

In case you havn't heard, there is a Presidential election coming up, and just as the tobacco sector of the national economy thought it could take a month or so off from SCHIP and related legislative battles, it realizes that it needs to stay on message and be just as ever persistent in keeping the government from ruining businesses, large and small, and from keeping the general public from enjoying a perfectly legal product.

The issue of the day is, “How will tobacco fair under a Barack Obama versus a John McCain administration?” The answer to that can be as confusing as figuring out how Ohio or Florida will vote - this time. Why? Because both national party candidates have a record of hitting tobacco. But elections have a way of affecting policy positions, and that’s where this discussion gets interesting.

Obama has a long and distinguished history with tobacco control legislation. From 2000 to 2005 as an Illinois state senator, he supported numerous pieces of legislation that called for taxes on distributors, taxes on smokeless products, taxes on cigarettes, and legislation calling for restrictions on tobacco advertising. As a US Senator, he supported the State Children’s Health Insurance legislation that would have hampered the growth and future of the premium hand-made cigar industry. But he likes that occasional puff.

McCain offers his own reasons for the tobacco sector to be concerned. He has a deep congressional record of supporting new taxes on tobacco, and he has been an avid supporter of FDA regulation of tobacco. He noted as recently as his September 5 “change is coming” nomination acceptance speech, that he has [singled out and] “fought tobacco companies.” Hmmm…..

But a funny thing happened on the way to the White House. It pushes some candidates to the left, and others to the right.

McCain has been the latter. He went on record stating his opposition to the SCHIP legislation, noting “We are trying to get people not to smoke, and yet we are depending on tobacco to fund a program designed for children’s health? I can’t buy that.” Obama supported the SCHIP legislation. However, McCain also has a deep history with the tobacco settlement legislative battle, especially with Big Tobacco player Philip Morris, when campaign advisor Charlie Black was lobbying for Philip Morris, and was subsequently “kicked out of his office.” The moral of that story is - you never know when that “McCain Maverick” side is going to pop out.

According to the Center for Responsive Politics, both have received tobacco financial support for their Presidential campaigns, but with McCain getting the better of Obama from the industry. As of September 2, McCain had taken in $100,066 from tobacco interests, to Obama’s $30,545.

The real story of this election season, though, is going to be the impact of this election on the composition of Congress. Neither Presidential candidate seems to be having the “coat tail” effect in congressional races, primarily because of the divisions that are still lingering in their respective parties due to the extensive and bitter primaries. “True conservatives” still don’t trust John McCain, and Hillary Clinton’s supporters are not flocking to Obama. When you have two candidates so close to 50 percent, you’re not pulling in Congress with you. The issue here is George W. Bush.

The lack of popularity for Bush will have a resounding impact in Congressional races, and that’s bad for tobacco interests. The two Bush veto actions on the SCHIP legislation saved the day for the premium hand made cigar industry, and the cigar industry is going to need to be diligent in supporting candidates friendly to the cause this fall.

Congress, not the White House, is the battle ground for cigars in 2008. It’s the difference between overriding a veto, and not; It’s the difference between a hostile House and Senate on a daily basis, versus a White House that just thinks about you every now and then.

Two telling commentaries came out just recently before the Presidential election that is indicative of what’s to come with an “unfriendly Congress.” First, the House Democratic majority realized they didn’t have the votes to push for new SCHIP legislation before the Presidential election. They realized they still didn’t have the votes to override a Bush veto. Secondly, the Senate majority gave up on pushing FDA tobacco regulation legislation during this congress. Basically, everything is on hold until January 2009.

On November 4, 2008, the tobacco interests of this nation - manufacturer, retailer, and patron - will each have a good idea as to where they stand on the legislative battles to come, not because of what happens with the new tenant of 1600 Pennsylvania Avenue, but because of the new cast at the other end of that street.

J. Glynn Loope is founder and president of Commonwealth Advance, LLC, a government relations and business development consulting firm in Virginia. He is also the lobbyist for the Cigar Association of Virginia.

SMOKESHOP - October, 2008