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Millions of teenagers would probably not be addicted to nicotine today if the lobbyist-led push in 2015 for flavored e-cigarettes didn’t succeed.
Earlier this week, Elizabeth Warren put out a proposal to tax all lobbying expenses above $500,000 from corporations and trade organizations. The same day, the Los Angeles Times released an investigation that epitomized why such a tax is needed.
In 2015, the Food and Drug Administration drew up plans for a ban on flavored vaping liquids, the kind that have attracted masses of young people to e-cigarettes and reversed a generation of reductions in nicotine use among teens. But, as the L.A. Times reports, over 100 lobbyists descended on Washington in a 46-day period, ultimately persuading the Obama administration to nix the ban in its final rule in 2016.
The final rule also removed 15 pages worth of evidence about how flavors would spur a rise in youth vaping, evidence that turned out to be correct. Millions of teenagers would probably not be addicted to nicotine today if the lobbyist-led push for flavored e-cigarettes didn’t succeed.
There’s lots to say about this episode. First, it shows the incredible power of the Office of Information and Regulatory Affairs (OIRA), an obscure division within the Office of Management and Budget that gets a final say on agency rules. As Jeff Hauser wrote recently for the Prospect, OIRA has become where good ideas go to die in administrations of both parties, using bogus “cost-benefit analysis” to satisfy industry wishes. The L.A. Times article primarily mentions OMB officials, but does note the role of Howard Shelanski, the head of OIRA at the time, and his chief deputy Allison Orris. The decision to kill the flavored vaping ban valued the cost of economic loss from vape shops over the prodigious public health benefits.
“Overreliance on cost-benefit analysis is one of many problems at OIRA that got worse as a result of corporate capture during the previous administration,” wrote Amit Narang, regulatory policy advocate at Public Citizen, in a statement. “OIRA is responsible for making the vaping crisis worse and is responsible for the illnesses and deaths that could have been prevented had the agency allowed public health experts at the FDA to regulate vaping as Congress intended.”
Just as interesting is the identity of the various lobbyists who pushed to preserve flavored e-cigarettes. You would expect the involvement of Juul, the most dominant e-cigarette manufacturer (Juul controls nearly three-quarters of the market and vaping is now often simply called “juuling”), which skyrocketed in particular thanks to flavors like mango and mint. One former OMB policy analyst who lobbied against the rule, Andrew Perraut, ended up as a public policy director for Juul.
But in addition to vape shop owners and e-cigarette companies, Big Tobacco giant Altria showed up at the White House to argue against the rule. On the surface, that doesn’t make any sense; Juul and other e-cigarette makers have premised their businesses on the notion that they serve a public health role by converting smokers to a safer alternative. Cigarette companies theoretically should have welcomed bans on any type of e-cigarette, which would limit competition for their addictive products.
But it would be a mistake to separate vaping and cigarettes as separate concerns, rather than lumping them all into the umbrella category of Big Sin. Altria’s special pleading on behalf of e-cigarettes proves it, and should end the false PR campaign pitting the two industries as rivals. Indeed, just a few years after successfully saving flavored liquids from a ban, Altria bought a 35 percent stake in Juul, the company that benefited most from the lobbying effort.
When it made its investment, Altria highlighted how it would be able to help Juul navigate the Washington regulatory process. Altria CEO Howard Willard bragged in a conference call after the purchase about how well-positioned the company would be to collaborate with Juul on an FDA application required of all e-cigarette makers before 2021 to remain on the market. “We have years of experience” with FDA regulations, Willard argued.
And Juul, we now know, understood plenty about the power of Altria’s lobbying muscle. It was put into action, on behalf of Juul’s core product, in 2015. That is likely to have been a factor in Altria’s investment in Juul; the tobacco giant had already proved the concept.
Today, Juul needs Altria, an established merchant of death, more than ever. In the past month or so, over 1080 people have been sickened, and 18 have thus far died, from a mysterious vaping-related illness. While these illnesses appear to be related to vaping involving THC, which is not present in any Juul products, the epidemic has caused a significant backlash against e-cigarettes more generally. When California issues an edict telling everyone to stop vaping right now, it’s bad for business.
Large retailers like Walmart have stopped stocking e-cigarettes, TV networks have stopped showing ads, cities and states have banned sales, and even President Trump has proposed taking flavored pods off the market. And aside from the latest health scare, e-cigarettes had previously been associated with seizures, potential heart risk and internal scarring of the lungs. There’s enough nicotine in one Juul pod as an entire pack of cigarettes, so the addictive properties are present as well.
Juul, already under federal civil and criminal investigation over marketing to children, saw its CEO step down. But the replacement, K.C. Crosthwaite, was formerly a top Altria executive. A second, former Altria regulatory affairs chief Joe Murillo, is also headed to Juul. The alleged antidote to Big Tobacco has transformed into an adjunct of Big Tobacco overnight. And Juul had already been running the Big Tobacco playbook, hiring a bipartisan all-star team of lobbyists, from former Massachusetts Attorney General Martha Coakley to former Trump administration adviser Johnny DeStefano.
Paradoxically, the crackdown on vaping could wipe out Juul’s retail competition at mom-and-pop vape shops, leaving them as the only distributor able to withstand the blow. The limitless resources and lobbying heft of Altria could rescue an upstart nicotine delivery device from federal attack. Juul has become an escape hatch for an old Big Sin power to buy in on the next Big Sin wave.
This all could have been curtailed four years ago, until the lobbyists poured into Washington, knowing that dressing up nicotine with berry and cotton candy flavors represented a golden ticket they had to preserve. The pain and suffering resulting from that lobbying flood hasn’t yet been fully calculated. But we know this: A tobacco giant had the foresight to protect the alleged existential threat to its business model, knowing it would eventually cash in on that decision.
