EFFORT TO REVIVE TOBACCO BILL FAILS

WASHINGTON - A Democratic effort to attach tobacco legislation to an
appropriations bill was rejected by the Senate today as the minority party
continued to portray Republicans as being in league with cigarette
companies.

"We will not let the issue die," Senate Minority Leader Tom Daschle said
hours after Congress' first national tobacco policy perished on procedural
votes. He tried to revive the legislation this morning by tying it to an
energy appropriations bill but was rebuffed, 54-44.

Sen. Slade Gorton, R-Wash., voted to reject Daschle's measure; Sen. Patty
Murray, D-Wash., voted in favor of it.

President Clinton also pledged to keep the issue alive in Congress and in
this fall's election campaign, declaring, "I don't intend to stop fighting
for this."

Yesterday, Senate Republicans effectively killed tobacco-control
legislation, leaving the challenge of cutting youth smoking and reducing
tobacco-related deaths to state legislatures and courts across the country.

The sponsor of the bill, Sen. John McCain, R-Ariz., blamed the cigarette
makers. "They're the big winners today," he said today on ABC's "Good
Morning America."

$40 Million On Ads

The tobacco industry spent an estimated $40 million on TV, radio and print
ads that painted the bill as a massive tax increase that would benefit
greedy trial lawyers.

The industry began its campaign in April after it became clear the bill
would extract at least $516 billion from it, rather than the $368 billion
it had agreed to in a 1997 settlement with state attorneys general.

The Senate bill would have raised the price of cigarettes by $1.10 per pack
and tightly regulated tobacco. In addition, the bill contained Republican
provisions such as a tax cut, limits on the paychecks of anti-tobacco trial
lawyers, and anti-drug measures.

Still, members of the GOP condemned the bill as a massive liberal
tax-and-spend bill.

"This bill has lost sight of the original noble cause of reducing teenage
smoking," said Majority Leader Trent Lott, R-Miss., who made the decision
to kill the bill. "The Senate in its unique way has reached a consensus: We
have not reached consensus."

Said Assistant Majority Leader Don Nickles, R-Okla.: "It frankly wasn't
fixable. This bill was a crummy effort at raising taxes."

The tobacco bill itself never was voted on. Instead, Republicans objected
to the bill on the grounds that it increased the federal budget too much.
They invoked a procedure that sends the bill back to the legislative
drawing board.

Democrats did not have the 60 votes to block them from doing so, and on a
53-46 vote, the bill was sent back to the Senate Commerce Committee,
effectively killing it. On that vote, Gorton voted to send the bill back to
committee (a "no" vote); Murray voted to keep the bill on the Senate floor
(a "yes" vote).

This followed an attempt by Democrats to cut off debate on the bill. That
attempt failed, 57-42; it was three votes short of the 60 votes needed to
force a vote. (Gorton voted against ending debate and Murray voted in
favor.)

Democrats and the White House vowed to attach the legislation to every
upcoming Republican bill. However, it appears they do not have the votes to
sustain this strategy.

Up To The States

Individual states must now decide whether to challenge the tobacco
companies in court or to settle with them, creating a piecemeal approach to
tobacco policy rather than the national policy envisioned by McCain.

The attorneys general's agreement will give each state a rough blueprint
with which to negotiate, but is not binding.

The strategy that mortally wounded the bill was decided on by Lott, after
he polled GOP senators at a closed-door meeting early yesterday. The merits
of both voting and killing the bill were discussed, as were the political
ramifications of both moves, the attitudes of the public and the expected
reactions in the House.

In the end, it was left to Lott to make the call.

Both public-health groups and tobacco companies put heavy resources into
building support for their sides, but clearly the industry spent more and
was more effective.

What's Ahead

The 4th Circuit Court of Appeals is considering whether the Food and Drug
Administration has the power under existing federal law to restrict or even
ban nicotine in tobacco products. Legislation clearly establishing that
right could have made the ruling moot. But it now appears that the agency's
authority will be decided not by Congress but by the federal courts.

Cigarette makers have put four of the biggest cases behind them, settling
for a total of $36 billion with the states of Mississippi, Florida, Texas
and Minnesota. All those states had sued to recover smoking-related
health-care costs.

The industry still faces suits filed by 36 other state attorneys general -
cases that would have been resolved by the tobacco bill.

About 15 class-action suits on behalf of allegedly addicted smokers - which
also would have been resolved by the legislation - now can go forward as
well.

Moreover, a flood of new claims filed since June (cases that the industry
had hoped to pre-empt through a nationwide settlement) have a green light.
These include suits by Blue Cross and Blue Shield plans in 38 states and
more than 30 class-action suits by union health-care funds seeking recovery
of costs for smoking related ailments.

Another 800 or so lawsuits by individual smokers also are pending.

While many of the cases have been treading water, the millions of industry
documents produced in the recently settled case in Minnesota have endowed
anti-tobacco lawyers with a trove of potentially damaging new evidence.

Compiled from The Associated Press, Knight Ridder Newspapers and the
Los Angeles Times.