This is Chapter 16 of my new book, working title “The Industry Playbook: Corporate Cartels, Corruption and Crimes Against Humanity” that is being published online chapter by chapter.
Thus far, this book has mostly focused on the USA. That’s where most of the Big Tobacco companies were based and where so many events took place. But the USA is not isolated from the world, especially as globalization ramped up after World War II.
While legal, scientific and cultural wars did eventually turn the tide against Big Tobacco within the USA, it is important to understand what happened across the world because of this. A not-often discussed strategy of the industry playbook is to take your money and influence elsewhere.
Burson-Marsteller, PR firm for Philip Morris, stated “despite the lingering tobacco liability cases and the drop in cigarette consumption in the United States, the tobacco companies themselves have never been healthier…foreign consumption of American cigarettes continues to grow dramatically.”
Never been healthier! That’s the result of playing this country arbitrage game. Regulation, lawsuits or other events may dampen your abilities in one country. But there are hundreds of countries that are not equal playing fields. What’s more is that the money of big industry often trumps the money of nation states many times over. This gives you further outsized power.
That’s why exports from Philip Morris, R.J. Reynolds, and Brown & Williamson went from about 50 billion cigarettes to 220 billion between 1975 to 1994. In 2018, cigarette exports from the USA totaled a value of $1.07 billion US dollars.
A tobacco industry executive honestly explained the overall strategy as such: “Demographically, the population explosion in many underdeveloped countries ensures a large potential market for cigarettes. Culturally, demand will increase with the continuing emancipation of women and the linkage in the minds of many consumers of smoking manufactured cigarettes with modernization, sophistication, wealth, and success—a connection encouraged by much of the advertising for cigarettes throughout the world. Politically, increased cigarettes sales can bring benefits to the government of an underdeveloped country that are hard to resist.”
Indeed, we can see that Big Tobacco sought this sort of influence and control outside the USA using all the other strategies already covered, not just locally but globally. Those benefits to government sometimes took the form of bribes to politicians and other influence peddlers as we’ll explore in a later chapter.
In 1981, Philip Morris, R.J. Reynolds and Brown & Williamson joined together to form the Cigarette Export Association (CEA), a non-profit trade association “to improve the competitive position” in foreign markets. The CEA would petition the U.S. Trade Representative to open restricted foreign markets to American cigarettes. It’s no surprise that, pulling political strings with lobbying and funding, they were successful in doing this. And we can see the results of this strategy playing out.
In China, Marlboro was the fourth largest advertiser in 1984. “The rise in smoking in China, where per capita consumption of cigarettes more than doubled between 1965 and 1990, mirrors what happened some forty years earlier in the United States,” wrote Brandt. “The tobacco companies bring a century of marketing savvy, intelligence, and doublespeak to their promotional efforts in these developing nations.”
In other words, the people of these developing nations didn’t stand a chance. The battle-hardened messaging, learning from successes and failures within the states, would be unleashed elsewhere.
That’s what led Surgeon General Koop to say, “I think the most shameful thing this country did was to export disease, disability and death by selling our cigarettes to the world…What the companies did was shocking, but even more appalling was the fact that our government helped make it possible.”
Enter the supranational political body, the World Health Organization. Some of the well-intentioned people there aimed to curb the abuses of Big Tobacco. In 1995, the World Health Assembly, WHO’s governing body, began looking into the possibility of an international treaty regarding tobacco.
Then in May 1996, the World Health Assembly unanimously passed a resolution for the director-general of the WHO to develop a framework convention, a type of treaty for tobacco control.
It wasn’t until 2003 when the 192 member nations of the WHO unanimously adopt the Framework Convention of Tobacco Control (FCTC), which was the WHO’s first ever multilateral treaty.
The WHO to the rescue, except not so much as you might guess by this point. We saw earlier regarding institutions that the WHO was heavily influenced and infiltrated by agents of Big Tobacco. This treaty was no different.
Specifically, Philip Morris hired PR firm Mongoven, Biscoe & Duchin (MBD) to help make sure the FCTC wouldn’t hurt them. Summing up MBD’s strategy Brandt writes that “Philip Morris should remain an engaged participant in the process so as to co-opt and weaken the treaty” and “to inhibit consensus and disrupt the negotiations.”
The final version of the treaty was called “feeble” and “meaningless.” Just one more step in defying and even defining regulation, this time on a global stage. Brandt writes, “While WHO sought to develop transnational regulatory initiatives, the multinational companies insisted that tobacco policies must be handled at the discretion of individual governments.” It’s interesting to see the mirror of “individual” governments responsibilities, much as Big Tobacco talked about individual people’s responsibility. Whatever would ultimately help their bottom line was their talking points.
What are the results of such global action?
Based on recent events, the following line in Brandt’s book really stood out to me. “In this century, in which we have known tobacco’s health effects from the first day, the death toll is predicted to be one billion. This is a pandemic.”
That’s over the course of a century, which means that ten million people every year die from tobacco related diseases.
I know, I know, it was a common tobacco defense that people have individual self-responsibility to smoke or not smoke. Are these kids making a conscious decision?
The marketing, the propaganda, strikes people hard especially at a young age, after all youth is what so much is targeted at. The cultural influence, which is predicated on these things, influences us all.
The latest stat I could find was over 7.1 million deaths in 2016. A whopping 884,000 not from smoking itself, but secondhand smoke. In many paces over 20% of deaths are a result of tobacco related diseases.
Again, do we have our health priorities straight? Or are such priorities really reflective of industry desires and leverage?
More examples of this country arbitrage game are described in the next few chapters.
Key Takeaways on Going Worldwide
- While most of the strategies and their effects described in this book focus on the USA, the playbook is used all across the world.
- The influence, power and money of Big Tobacco ultimately outmatched many countries. You’ve seen how much influence they had in the states, just imagine when a company’s revenue is bigger than the GDP of a country.
- Lobbying and political influence was used to make “free” trade possible across borders, supporting the market growth of Big Tobacco.
- Big Tobacco was able to stall, inhibit and disrupt the WHO from developing a powerful multilateral treaty. What they did pass was called “feeble” and “meaningless”.
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Links to all published chapters of The Industry Playbook can be found here.
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