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TERRY GROSS, host:

This is FRESH AIR. I'm Terry Gross. Last summer, Congress passed the Tobacco Control Act that will, for the first time, allow the federal government to regulate the tobacco industry. It puts tobacco products under the authority of the Food and Drug Administration. New regulations and restrictions are on their way. Also, cities and states across the country have been enacting indoor smoking bans, so tobacco companies have come up with new smokeless products so people can get their nicotine fix indoors.

One new nicotine product looks and tastes like little candies. Just this week, the Harvard School of Public Health released a report warning that these products pose the risk of serious nicotine poisoning for children who eat them, thinking they're just candies. We'll hear about these new developments in a minute.

Reports about the health dangers of cigarettes first began appearing in the 1950s. Reader's Digest published a widely read article titled "Cancer by the Carton." The following year, cigarettes sales declined for the first time. Cigarette advertising was one of the subjects in the premier episode of "Mad Men," about an ad agency in the early '60s.

Let's hear a scene from that episode. The head of creative for the agency, Don Draper, is designing a new ad campaign for Lucky Strike cigarettes and responds to the health care scare. He's making his pitch to the father and son who own Lucky Strike.

(Soundbite of TV show, "Mad Men")

Mr. JON HAMM (Actor): (as Don Draper) Gentlemen, the Federal Trade Commission and Reader's Digest have done you a favor. They've let you know that any ad that brings up the concept of cigarettes and health together, well, it's just going to make people think of cancer.

Mr. JOHN CULLUM (Actor): (as Lee Garner Sr.) Yes, and we are grateful to them.

Mr. HAMM: (as Jon Draper) But what Lee Jr. said is right. If you can't make those health claims, neither can your competitors.�

Mr. CULLUM: (as Lee Garner Sr.) So, we got a lot of people not saying anything that sells cigarettes.�

Mr. HAMM: (as Jon Draper) Not exactly. This is the greatest advertising opportunity since the invention of cereal. We have six identical companies making six identical products. We can say anything we want. How do you make your cigarettes?

Mr. CULLUM: (as Lee Garner Sr.) We breed insect-repellant tobacco seeds. Plant them in the North Carolina sunshine. Grow it, cut it, cure it, toast it...

Mr. HAMM: (as Jon Draper) There you go.

Mr. DARREN PETTIE (Actor): (as Lee Garner Jr.) But everybody else's tobacco's toasted.

Mr. HAMM: (as Jon Draper) No. Everybody else's tobacco is poisonous. Lucky Strike is toasted.

GROSS: That's Jon Hamm in a scene from the AMC's series "Mad Men."

Our guest, Duff Wilson, covers business and the tobacco industry for The New York Times. He talked about new smokeless tobacco products and new tobacco regulations with FRESH AIR contributor Dave Davies.

DAVE DAVIES: Well Duff Wilson, welcome to FRESH AIR. You know, in June, while all of us were focused on health care reform and other issues, there was actually this very important piece of tobacco legislation enacted by Congress. What does it do?

Mr. DUFF WILSON (Journalist, The New York Times): It regulates cigarette products and tobacco for the first time in history. They've always been totally exempt from regulation basically, as a food or a drug, because of a Supreme Court decision about 10 or 12 years ago. So finally the government can require tobacco companies to disclose what's actually in those cigarettes and it can regulate the contents of them.

DAVIES: Right. And so now the Food and Drug Administration, right, the FDA...

Mr. WILSON: Mm-hmm.

DAVIES: ...will have this under their purview. And you say for the first time, they'll actually have to tell us what's in cigarettes? We haven't known that up tell now?

Mr. WILSON: That's right. We haven't known that. They won't have to tell us. The cigarette companies will have to tell the FDA. And then they may try to protect some of that as trade secrets, but it gives the FDA something to try to regulate. You know, like not only the nicotine levels but all the other additives that they have in cigarettes.

DAVIES: Did this bill have specific provisions regarding say, marketing and advertising of their products?

Mr. WILSON: Yeah it did. It rolls out a few important provisions really. One of the main ones is they can no longer say they're light, mild or low tar cigarettes as of June 22nd this year. It was amazing to me to learn that these light and mild, so-called cigarettes, are just as dangerous as the regular full strength cigarettes, because people tend to inhale them deeper and hold them longer and to take more puffs per cigarette, all to satisfy that nicotine addiction.

DAVIES: Now is there a ban on advertising in color here? I mean is there some specific provision regarding their advertising?

Mr. WILSON: Yes. Their advertising is supposed to be black and white text only. No colors, no images, except inside tobacco stores where kids aren't allowed or in adult reader magazines. So they're really trying to remove the color advertising that can be seen, let say, from the street, outside the, you know, the corner bodega or convenience store.

There's a further provision that would not allow any of those signs within a thousand feet of a school or playground.

DAVIES: There's a much more visible warning label requirement with this new law as well?

Mr. WILSON: Yes. That's one of the major changes we're going to see is cigarette packs, instead of that little warning that the surgeon general says, are going to have to be half covered, half the pack covered with a graphic warning label, including images. So we're probably going to see images of lung cancer and lip cancer and those kind of awful pictures that you see in some advertising nowadays in Canada and other countries. They're supposed to go in effect in 2013, so it's a ways off. And this packaging image, if you will, like the disease pictures on the pack, are going to be fiercely opposed, really, in the courts and we'll see which way the courts go.

DAVIES: Wow. You know, I want to talk about some other provisions and some other trends in the industry. But I have to ask you, first, where did the impetus for these tough new regulations come from? You know, I think a lot of us, you know, and I'm sure, I know they were reported on but a lot of us may not have been paying close attention.

Mr. WILSON: Mm-hmm.

DAVIES: Where did the political momentum for these changes come from?

Mr. WILSON: Politically, I think it kind of came from Henry Waxman in the House and Ted Kennedy in the Senate. It came from 1994 hearings in Congress, when those tobacco executives for the seven large companies testified under oath that tobacco - or that cigarettes - were not addictive, not harmful and that they had not been targeting kids.

And so Henry Waxman, the Chairman of the House Committee, he told me recently -after that whistleblower started coming out and industry documents were leaked out, he said after those executives, you know, lied before the whole American public in a Congressional hearing. A couple of years after that hearing in 1996, the FDA tried to assert its own authority cigarettes and say they were a drug delivery device and that nicotine was a drug. That was appealed, and the Supreme Court knocked that down by a five to four vote saying that they needed special congressional authority. So it's taken from '96 until last year - 13 years - to get that congressional authority.

DAVIES: And how much of a factor was the election of Barack Obama, himself a smoker who has struggled to quit?

(Soundbite of laughter)

Mr. WILSON: You're right, that was a big factor. I think having a Democratic, you know, House and Senate and Obama in the White House. President Bush was not a big supporter of this proposal. In fact, it only passed the Senate by a two-vote margin last year in one of those filibuster votes.

DAVIES: We're speaking with New York Times business reporter Duff Wilson.

We'll take a short break and then we'll talk some more.

This is FRESH AIR.

(Soundbite of music)

DAVIES: If you're just joining us, we're talking about new regulations on tobacco enacted by Congress and soon to come from the Food and Drug Administration. We're speaking with New York Times business reporter Duff Wilson.

I wanted to talk about some of the new products that tobacco industry has come up with. One of them are these products that are called snus. What are they?

Mr. WILSON: Snus is a spit-free, kind of, tobacco-filled pouch. Kind of like a tea bag, but smaller, that the user is supposed put inside their upper lip to get a nicotine hit without, you know, having to spit like they do on the baseball games and the cowboy movies.

DAVIES: And how long have they been around?

Mr. WILSON: Snus is hardly even around now. It's only been test marketed in a few cities and it's supposedly going to national distribution by one or two of the companies now. I don't think you can really find it very easily at stores, but they have hopes that it will grow.

DAVIES: Now the other product that I've heard about are dissolvable tobacco products.

Mr. WILSON: Yes.

DAVIES: Tell us about those.

Mr. WILSON: The major one is from R.J. Reynolds. It's called Camel Orbs. And again, it also comes in a mint flavor as well as regular, and they look kind of like Tic-Tacs. They come in a box kind of that size and they're these little pellets that are dissolvable nicotine. Sorry Dave, I haven't tried one and I don't really want to yet, but...

(Soundbite of laughter)

Mr. WILSON: ...they're what anti-smoking groups for kids are really concerned about. The youth smoking opponents are really concerned that those Camel Orbs and similar dissolvable products are going to be, you know, attractive for kids because they look and sometimes taste a little bit like candy.

DAVIES: Now, I guess one of the big questions about these new smokeless tobacco products is whether they are safer. What do we know about that?

Mr. WILSON: Mm-hmm.

DAVIES: Safer than cigarettes. I mean you don't get it in your lungs, I guess, right?

Mr. WILSON: Oh yes. Yes. Absolutely. The actual product itself is much less harmful than a cigarette, 90 to 99 percent less harmful, I think most people would agree. So the issue on it is whether it encourages more people to start down the path of cigarettes, as this kind of a gateway product or actually helps more cigarette smokers who would otherwise be hurting themselves to hurt themselves less.

DAVIES: But I guess the serious health issue that some are raising is whether they're making this product, which as, you know, in some cases can look awfully appealing and somewhat like candy, they can make it, you know, that much easier for a young person to get started on.

Mr. WILSON: Right. And they can also make it easier for current smokers to continue smoking and get around the fresh air laws so to speak. You know, there's three things that have been proven to help people quit. And smoking in this country has gone done over - since the surgeon general's report in 1964 -from 42 percent of adults to less than half of that under 20 percent. So we're making headways on less smoking but we're still at 20 percent of adults.

Three things are proven to help encourage people to quit. Number one, high prices and so, the governments both state and federal are taxing cigarettes at a very level and the prices have gone up. It's very price sensitive. The second one is these fresh air or indoor air laws, now expanding I guess, to some sidewalks in New York. But that really has encouraged more people to quit because it's kind of stigmatized smoking. And the third one is education and knowledge about the dangers of smoking.

But these new products that we're talking about, the snus and the orbs and the rest of it, are really directly a way around the indoor air laws that's been a very important component of the quit smoking movement.

DAVIES: What do the statistics tell us about how often smokers try to quit and how likely they are to succeed?

Mr. WILSON: Nicotine's really hard to quit. It's really hard to quit smoking especially if you start young. The statistics say that a lot of people try, though. Like 45 percent of smokers try every year - every 12 months. Almost half of smokers try to quit but only two and a half percent succeed per year. So it's very hard to quit and anything that can be done to help people quit, whether it's let's say the carrot of a nicotine replacement product or the stick of a stigma in indoor smoking bans, you know, has encourage more people to quit.

DAVIES: Only two and a half percent succeeding in quitting is a pretty striking number. Which raises a question about the, you know, the future of whether we're really going to get people off of cigarettes. How does the public health community view these smokeless products?

Mr. WILSON: They're sharply divided over smokeless products and the so-called reduced harm products. It's the most divided or divisive issue in the public health community because a lot of scientists and doctors that have battled smoking for decades say hey, these are much safer than cigarettes. Let's encourage these reduced harm products. And others say indoor air laws, for instance, are a good way to get people to quit smoking. And if you give them an alternative like a, you know, a pouch or a, you know, oral tobacco product during the work day, then they'll keep smoking outside of it.

DAVIES: Now there's a major case that could be reviewed by the Supreme Court dealing with the industry's marketing of so-called light cigarettes are healthier. But there's a longstanding action by, I guess, the Justice Department, that they sued the tobacco companies for their past marketing of this. So tell us what that case is about and what the stakes are.

Mr. WILSON: The Justice Department sued nine leading cigarette companies for racketeering, conspiracy, fraud, lying about the risk of cigarettes, lying about marketing to kids, the whole nine yards. They sued all these companies in the Clinton administration, I think. And then, a federal judge convicted the tobacco companies of racketeering for all that activity in 2006. She said some really harsh things about the tobacco company's deceptive marketing and that's been on appeal. It was recently upheld by a court of appeals and now both the tobacco companies and the Department of Justice have appealed this case to the Supreme Court.

The tobacco companies want the racketeering conviction overturned. They don't want to be called racketeers. The Department of Justice wants to have the power to force them to disgorge past profits, over $200 billion in past profits. They're asking for the authority to force the cigarette companies to disgorge it because they were profits from an allegedly racketeering enterprise.

DAVIES: Wow.

Mr. WILSON: So there's high stakes. The Supreme Court hasn't announced yet if it'll take the case, although that announcement may come within the next month or two.

DAVIES: So this would be a criminal conviction of big tobacco?

Mr. WILSON: It is a conviction under the racketeering law that's mostly used for organized crime figures. Yes. It's a criminal conviction and they can be called racketeers, which they don't like. [POST-BROADCAST CORRECTION: Mr. Wilson misspoke when he referred to a government case against American tobacco companies as a criminal conviction. In fact, the tobacco companies were found guilty of violating civil racketeering laws.]

DAVIES: Right. And when this happens to mob bosses they go to prison. No tobacco executives are going to be in the dark, are they?

Mr. WILSON: No. No. There's no prison proposed here at all. It was mostly used as a way to get all this evidence into the public arena about the deceptive marketing and the light cigarettes and then to convict them as corporations. They're not being convicted as, you know, individual executives.

DAVIES: Okay. So that is, the current rulings have upheld the racketeering conviction and the huge fine, and it may or may not be decided ultimately by the Supreme Court.

Mr. WILSON: Yes. The latest appeals court ruling upheld that racketeering conviction. It may or may not be heard by the Supreme Court and while the companies are trying to reverse the racketeering conviction, the Department of Justice is trying to push it even harder than they did years ago and to force them to give back over $200 billion in past profits.

If that happens somehow, it could bankrupt the companies, so business analysts think that's very unlikely that the court would allow all the tobacco companies to be bankrupted and have to give back all their past profits, just from a practical view. Because a lot of this goes back to a practical consideration of do we want to try to ban cigarettes or to have a prohibition on cigarettes? And that didn't work very well with alcohol and few people want to actually do it with cigarettes.

You know, you've got tens of millions of addicted customers and they're going to find some way to satisfy that addiction whether it's with a black market or legally through convenient stores, like they do now.

DAVIES: Well, I'm sure you'll be keeping track of it. Duff Wilson, thanks so much for speaking with us.

Mr. WILSON: Thanks for having me, Dave.

GROSS: Duff Wilson spoke with FRESH AIR contributor Dave Davies. Wilson covers the tobacco industry for The New York Times. You'll find links to all of Wilson's stories about the tobacco industry on our website freshair.npr.org.

Here's an old cigarette song sung by Abbey Lincoln.

(Soundbite of song, "Two Cigarettes in the Dark")

Ms. ABBEY LINCOLN (Jazz vocalist, songwriter, and actress): (Singing) Two, two cigarettes in the dark. He strikes a match 'til the spark, clearly traces one face is my sweetheart. Two, two silhouettes in a room. Almost obscured by the gloom. We were so close yet so far apart. It happened that...

GROSS: Coming up, Ken Tucker reviews Merle Haggard's new album.

This is FRESH AIR.

(Soundbite of music)

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