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House blocks FDA oversight of tobacco

The Senate has approved the most significant corporate tax legislation in nearly 20 years, a sprawling $140 billion measure that closes loopholes, reduces taxes for domestic producers and doles out scores of tax breaks for special interests.
/ Source: a href="" linktype="External" resizable="true" status="true" scrollbars="true">The Washington Post</a

When the Senate voted 78 to 15 in July to give the Food and Drug Administration the power to regulate cigarettes, it seemed that health advocates were on the verge of a major legislative coup.

The Senate amendment was attached to a massive, "must pass" corporate tax bill that Republicans in both houses badly wanted. Supporters strengthened their hand by coupling FDA regulation with a House proposal for a multibillion-dollar buyout of struggling tobacco farmers.

But in the end, a strong-willed group of Republicans in the House outmaneuvered Senate negotiators and pushed through a tax bill that gives corporations billions of dollars in new breaks, and preserves a $10 billion buyout of tobacco farmers, but leaves FDA regulation of cigarettes on the cutting-room floor for this session of Congress.

"We were blocked by a small minority in the House leadership," said Vince Willmore, director of communications for the Campaign for Tobacco-Free Kids.

Some Democratic lawmakers saw the White House's hand in it, as well. Sen. Tom Harkin (D-Iowa), a longtime supporter of FDA regulation, said House Republicans who negotiated with the Senate on a final deal were doing the bidding of the president. "I lay this right at President Bush's door," he said. "He concurred with big tobacco."

A win for business
The outcome enabled Republicans to burnish their anti-regulatory credentials with the business community while providing campaign fodder to party candidates running for election this fall in several key tobacco states. It was a major setback for health care advocates concerned about the widespread use of tobacco by young people.

Proponents of FDA oversight of the tobacco industry have sought the legislative authority since 2000, when the Supreme Court voted 5 to 4 that the agency's earlier claim of authority over tobacco was unconstitutional. Tobacco interests have been lobbying for a federal buyout of their Depression-era quota system for just as long because of the plunging value of their crop. In the end, tobacco interests prevailed over pro-regulatory forces.

In North Carolina, where Rep. Richard Burr (R) is engaged in a close race for the Senate against Democrat Erskine Bowles, each candidate has rushed to take credit for the tobacco buyout while attempting to minimize the role of his opponent.

GOP leaders placed Burr on the House team negotiating the tax bill with the Senate, and they credited him with being one of the main architects of the buyout.

But a spokesman for Bowles noted yesterday that during the final House-Senate bargaining last week, Burr twice voted against amendments that would have restored the FDA regulatory language in return for an additional $2 billion for tobacco farmers — including an extra $790 million for North Carolina growers.

Regulation seen as 'poison pill'
A Burr spokesman defended those votes, saying that FDA regulation in any form would have been a "poison pill" that would have sunk hopes for any buyout.

"The House was not going to pass FDA oversight of tobacco, period. So the question became: Do we have a buyout or not?" said Burr spokesman Doug Heye. "Our opponent had consistently said it [the buyout] could be done without FDA oversight. Richard Burr not only said it could be done, but he did it."

In House-Senate negotiations to reconcile different versions of the tax bill, House Ways and Means Committee Chairman Bill Thomas (R-Calif.), a master of legislative maneuvering and tactics, emerged as the key player, according to lobbyists and fellow lawmakers. Thomas presided over the tax bill negotiations and exercised his prerogative to drop the regulatory provision from his initial draft of a compromise. It would have taken agreement of both House and Senate negotiating teams to add the FDA language, which turned out to be impossible.

Across from Thomas sat Charles E. Grassley (R-Iowa), chairman of the Senate Finance Committee and a shrewd veteran negotiator in his own right. A tax bill without FDA regulatory authority could not have moved forward without a majority of the 23 Senate negotiators. The Senate group was made up of 12 Republicans and 11 Democrats, including Edward M. Kennedy (Mass.) and Harkin, both strong advocates of FDA regulation.

"The only card we had was if we could have demonstrated a united front of all Democrats and one or more Republicans to prevent the [negotiators] from coming back without FDA regulation," said Paul Billings, vice president of national policy for the American Lung Association.

'Big game of chicken'
But Grassley's overriding interest was to get the underlying tax bill through Congress and signed by the president, according to sources. With billions of dollars in tax benefits on the table for agricultural and energy interests and home-state corporations, Democrats wavered.

"There was a big game of chicken going on in terms of who broke first," Willmore said. Despite being "very disappointed" that Grassley had not fought harder for the FDA provision, Willmore noted that the House negotiating team "was rigged to defeat FDA regulatory authority from the start, in our view."

Six of 11 Senate Democrats ultimately supported the compromise tax measure without the FDA provisions: Max Baucus (Mont.), Thomas A. Daschle (S.D.), Kent Conrad (N.D.), John Breaux (La.), Jeff Bingaman (N.M.), and Blanche Lincoln (Ark.). All are from states whose energy producers or farmers will benefit from the bill's far-reaching tax provisions. Daschle is facing a tough reelection campaign.

Health groups, meanwhile, maintained their cause still had advanced. In a voice vote that will have no practical effect, the Senate on Sunday again passed separate legislation establishing FDA regulation of tobacco. The House is not expected to consider the Senate bill before Congress adjourns for the year.

Senate Majority Leader Bill Frist (R-Tenn.), who had supported FDA regulation, said yesterday it was impossible to overcome House opposition to the plan. "There is not a lot of strong support for FDA regulation of tobacco," especially in the House, he said.

Asked if the Senate had been outmaneuvered on this and other issues, Frist said, "I don't know that we got rolled, but the House spoke more loudly there."