You know, it's always interesting to run across the sort of story that gave this weblog its name...
CBS News | Cig Settlement Funds: Up In Smoke | December 31, 2002 00:51:30: Mike Moore, Mississippi's attorney general, is one of the angriest men in America. Angry, because he says most states are wasting the $250 billion settlement he helped win from Big Tobacco. [...] North Carolina has spent more than $40 million in tobacco settlement funds -- so far -- buying state-of-the-art equipment for tobacco farmers. Farmers like Robert Boyette got direct grants to upgrade the furnaces in their curing barns. "The industry was basically mandating this," he says. [...] Officials in North Carolina, like House majority leader Phil Baddour, disagree, calling the grants to farmers a necessity. Without them, he says, the economy in the poorest areas of the state would have collapsed. Baddour doesn't see any irony in using funds from a lawsuit that had to do with health care costs, on helping farmers get better at growing tobacco. "The health of the community is dependent on our agricultural economy," he says. "So to the extent that we are spending money to aid those communities economically, we are doing a good thing."
Ah, irony. Big anvil, there.
So, let me get this straight: North Carolina is using money that it received from the tobacco industry for past misdeeds to support the tobacco industry in its state to prevent the current collapse of the agricultural economy. Right. And while it's understandable that North Carolina would wish to do so, one wonders why they don't look longer term. The tobacco industry is likely to collapse in any event, and it would be better to shift those people away from that crop. (Granted, during a recession would have been a particularly bad time in most ways.) Additionally, those 6700 farmers are producing a crop which will be sold, at least in part, to other North Carolina people, who will smoke and become ill and for whom the state may well need to pay significant medical costs. (Leaving aside the social costs, for now.) Surely this use is somewhat ... short-sighted.
While it is true that North Carolina's use of its settlement money could be considered the most egregious misuse, they're certainly not alone. States across the country are using their tobacco money for purposes for which it was never originally intended:
..... The cold realities of budget deficits make the settlement money an attractive option for cash-strapped states. And earlier this week, a federal appeals court here reaffirmed states' right to spend settlement funds at their discretion. But that doesn't make it sound policy, according Mike Moore, Mississippi's attorney general, who spearheaded the settlement. "They think that the money just fell out of heaven, and, 'OK, I have a deficit,' or 'I have a political whim,' or 'I need to build a highway,"' Moore said Thursday in an interview at a national anti-smoking conference here. "I call it moral treason. I call it stupid. It's so shortsighted."
Well, no, they don't really think the money fell from heaven, and calling it "moral treason" is a bit ridiculous. What the state governors think is that they have massive budget deficits and they are already cutting services to the bone. (For example, in 2003, states are facing a cumulative deficit of $60 billion and more, although more than half of that is California's deficit alone. The outgoing governor of Illinois was kind enough to his successor to attempt to make a few budget cuts before he left, so the man wouldn't come into office faced with a budget disaster to be solved immediately, but even doing that, the state will need to cut an additional $2 billion before the end of this fiscal year in July. The money will likely come from services to the poor and from higher education, in significant part.) They're trying desperately to fill the gap with whatever they've got. States are even turning to raising taxes as an option (although generally not the income tax -- like Washington, states have a curious reluctance to tax those most able to pay, perhaps because they have the best paid lobbyists). States are cutting services to the poor just as the need for those services increases sharply. To be sure, some people do recognize the needs at hand: Los Angeles actually voted itself a property tax increase, for the first time in ages, to cope with the public healthcare funding crisis it's having. However, most states and cities are not likely to ask their citizens to do so. We've become addicted to low taxes, as if they were a drug, and we've elected a generation of political cowards that are extremely reluctant to say, "Look, we cut income and other taxes too far in the 90s. We simply cannot sustain minimal services without increasing taxes." (The cowardice being most marked in the previous Congress, of course, where the Democrats could have done what an opposition party is supposed to do and oppose unwise policies, such as the last tax cut, but did not because they were "popular".) Everyone is noting that the federal government will need to help the states, but because of the aforementioned cowardice, the federal government has nothing to help the states with. The projected federal budget over the next 10 years is at least $1.5 trillion.
So really, the issue isn't moral treason; it's just acute cowardice from their side, and shortsightedness from their side and ours that are making things the way they are.
Posted by iain at December 31, 2002 02:34 PMComments
