CLINTON ENDORSES CIGARETTE PRICE-HIKE BILL

WASHINGTON-Hoping to prod Congress to move ahead on tobacco
legislation, President Clinton gave his blessing Thursday to a bill
that would raise cigarette prices by $1.50 a pack and set an annual
cap on the industry's legal liability.

"It is a good, tough bill," Clinton said in a speech to the National
Association of Attorneys General. "I hope it gets wide support. This
legislation will save lives."

But Senate Majority Leader Trent Lott already has picked a different
bill and set a June 1 deadline for a vote on it, according to that
measure's sponsor, Sen, John McCain, R-Ariz., who chairs the Commerce
Committee.

"There's only gonna be one bill that goes to the floor of the Senate,
and that's what comes out of the Commerce Committee," McCain told the
same group later. "Have no illusions otherwise."

The bills offer the tobacco industry different kinds of protection
from lawsuits.

McCain's bill would grant the industry immunity from class-action
lawsuits in an effort to prevent massive judgments from bankrupting
companies.

The bill endorsed by Clinton, sponsored by Sens. Tom Harkin, D-Iowa,
John Chafee, R-R.I., and Bob Graham, D-Fla., instead would set an $8
billion limit on what tobacco companies could be forced to pay
plaintiffs in any year. That way, the sponsors say, individuals with
limited funds could share costs in class-action lawsuits.

McCain's bill is modeled after the $368 billion settlement reached in
June between state attorneys general and the tobacco industry, which
would settle 40 state lawsuits and shelter companies from future court
action brought by large classes of plaintiffs.

In other developments Thursday:

(Texas Gov. George W. Bush is demanding a full accounting after
learning that the private attorneys who helped Texas fight the Tobacco
industry ran up $1.75 million in expenses in 1996, including a $952
lunch and $1,995 to charter an airplane. Then the real spending started.

The expense accounts for the lawyers and their staffs have ballooned
to nearly $40 million since state Attorney General Dan Morales stopped
requiring itemized reports at the beginning of 1997.

(According to a document introduced Thursday in Minnesota's tobacco
trial, Philip Morris was researching the effects of cigarette smoke on
animals when it criticized a competitor for violating a gentlemen's
agreement not to do such research.

Researchers Alan Rodgman and F.G. Colby of R.J. Reynolds Tobacco Co.
analyzed Philip Morris research dating to the mid-1960s for a company
presentation in 1983. That was the year Philip Morris became the
nation's No. 1 cigarette maker on the popularity of the Marlboro brand.