A little story about Big Tobacco By IRINA SLAV, Big Oil “has been hard at work to make its business as clean as possible and I don’t mean CO2 emissions, I mean spills and leaks, and engine efficiency”
The claim that humankind’s consumption of hydrocarbons is an addiction is utterly ludicrous and no amount of lawsuits and bans can change that. Reality will debunk that claim given half the chance.
A little story about Big Tobacco
APR 24, 2024
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In 1997, U.S. states sued the pants off the four biggest cigarette manufacturers in the country. The size of the settlement was $368.5 billion. It was called the Master Settlement Agreement, punishing the industry for marketing harmful products for decades.
Big Tobacco was also hit with massive regulations and tax hikes as the West fought against the most popular human addiction. At the time the MSA was sealed, I had just switched from Marlboro to Silk Cut because their packs looked very stylish and the advertisements were Something Else.
Public space smoking bans followed, prices soared, and smoker numbers took a plunge although anecdotal evidence had it that smokers from ban-happy countries enjoyed something like cigarette tourism, travelling to ban-free countries and making up for nicotine lost by smoking their heads off.
Like many at the time, I thought Big Tobacco was basically finished. They would never make billions again. People were just not smoking as much and a new generation of healthier individuals was growing up, never to touch the stuff, and good for them and their hearts and lungs. Boy, was I wrong.
This Tuesday, Philip Morris International reported a 23% increase in first-quarter earnings per share, on revenues that beat analyst expectations. The company shipped 33.1 billion heated tobacco devices globally in the period, boasting that Iqos device and, I presume, stick sales now account for over 50% of its net revenues, surpassing the flagship Marlboro brand.
Philip Morris expects further growth in these sales. And it’s not the only one. Big Tobacco is going smokeless and it’s going to make them billions. As I write this, I occasionally pull on my own heated tobacco device and ponder the irony that has certain U.S. states and other jurisdictions frothing at the mouth with the prospect of giving Big Oil the Big Tobacco treatment. Go on, punks, I say to myself. Make them stronger.
The sum of Big Tobacco’s settlement in the U.S. alone back in 1997 was truly enormous, of course. It couldn’t not affect the industry, especially since there was hard proof that their products were indeed harmful for human health, substantially raising various risks for some of the nastiest ways to die featuring not only several types of cancer but debilitating and eventually fatal emphysema and even COPD. COPD might not kill you but it would sure make your old age torture.
The regulation push that followed the lawsuits delivered another massive blow to an industry that had thrived on humans’ tendency to get addicted to various substances. To this day, I believe, nicotine addiction remains the hardest to kick, although I have my doubts regarding some new synthetic pharmaceutical poisons. In any case, Big Tobacco became Big Tobacco because hundreds of millions of people basically had a death wish.
The industry itself, however, did not manifest any signs of having that same death wish. They could have changed. They could have folded and sprung back as something entirely different. But they didn’t. Instead, they took the blows and started working on cleaning up their act quite literally. They started researching alternatives to cigarettes that would reduce the risks while keeping the pleasure we deathwishers derive from inhaling nicotine.
Fast-forward 30 years and there is a whole new market for nicotine delivery systems. Most of it is disgusting crap with nicotine-loaded propylene glycol you inhale like some complete loser because you like the artificial raspberry flavour of the liquid. I’ve tried vaping. Once. It was truly disgusting. And then by force of circumstance, I introduced myself to the heated tobacco product market.
After a single cigarette (they call them sticks, of course, toxic word, etc.) I knew two things. First, I might end up living longer than I previously suspected and, two, Big Tobacco was back. Big time.
It is therefore with much amusement that I see headlines like this one: California's Big Oil Lawsuit Strategy Mirrors Fight Against Big Tobacco, or this one: The Big Tobacco moment comes for Big Oil, or, indeed, this one: A Strategy to Treat Big Tech Like Big Tobacco.
This sort of headlines reminded me of “The Neverending Story”, which has a special place in my heart because it was the very first movie I watched on a big screen. It was years before I learned that the movie only told half of the story. So I read the book. It was one of the few decisions in my life I’ve regretted, not because it was a bad book — of course it wasn’t. It was because the second half was sad, cruel, and depressing despite the happyish end.
The reason that the rush to do to Big Oil what was done to Big Tobacco reminds me of my “Neverending Story” experience is that those chomping at the bit to sue Big Oil into oblivion clearly have not been following the latest news in the tobacco world, which is that the world still smokes. A lot.
And it is going to smoke a whole lot more as it gets its feverish addicted paws on devices that give you all of the nicotine and cigarette-taste experience and none of the tar and other foul by-products of the burning of dry leaves.
You know all those activists gleefully comparing the world’s consumption of hydrocarbons to an addiction? Right. Those have only read the first part of the story, too. Had they read the whole story, it may have dawned on them that true addiction is extremely hard to beat.
It becomes impossible to beat when it’s an “addiction” to something that is vital for the proper functioning of the organism — in this case the global economic organism. Oh, and incidentally, addiction makes a lot of money. I mean, just ask Big Tobacco or a random drug dealer, I guess.
Big Tobacco spent three decades reinventing itself as a responsible drug dealer who took care to make its product a lot less harmful for its users (I won’t hear any arguments. Heated tobacco is measurably [sic] better. My heart and lungs say so.)
Over the same time period, Big Oil has also been hard at work to make its business as clean as possible and I don’t mean CO2 emissions, I mean spills and leaks, and engine efficiency. Yeah, we got Deepwater Horizon but no one’s ever claimed that human stupidity could be eradicated. Disasters, alas, happen. Outside these, Big Oil has become a lot more responsible than it used to be. And just like Big Tobacco, it became more responsible because it was forced to — in part.
Things like drilling efficiency and better infrastructure monitoring to reduce the risk of spills and leaks, and make the most of each well, advance because it is in the financial interest of the companies doing the advancement. Flaring bans and methane tracking and capturing may not be in their interest now but over the longer term, this may well boost gas output — and profits. Why waste the commodity when you can sell it? Big Oil attackers are helping Big Oil improve the sustainability of its business. And make more money.
So, in answer to the question posed by the New York Times last September, Are Fossil Fuels the Next Cigarettes? I’d say “Sure they are. And everyone is going to be smoking more as their producers keep making them better.” Bans and prohibitive pricing, you say? Go ahead but don’t complain when your economy crumbles under the weight of twitchy neurotics, violent alcoholics and hard drug abusers, and useless dopeheads. Oh. Wait.
Now go ahead and give the Big Tobacco treatment to Big Oil. See what happens.
Clarification: I do not condone the uncontrolled use of addictive substances. The idea that addiction can be avoided altogether through forceful means, however, has been repeatedly disproved by history. If you have the tendency, you will get addicted to something or other, be it a substance or behaviour, destructive as they are.
The claim that humankind’s consumption of hydrocarbons is an addiction is utterly ludicrous and no amount of lawsuits and bans can change that. Reality will debunk that claim given half the chance. I suggest we avoid giving reality that half a chance.