The Financial Motive of Michigan’s Vape Ban
Michigan’s vaping ban is an issue of tobacco tax revenue, not safety.
Author’s note: Information that came out well past the original date of this post’s publication (September of 2019) has changed my perspective on this slightly.
The punishments.
As a Midwestern critic of prohibition and a children’s health advocate who doesn’t vape…I’m conflicted on the Michigan vape ban.
To be clear, I do think a lot of people’s hearts are in the right place. Despite how minuscule and abrupt this vaping-related illness is, the wellbeing of our youth is paramount.
However, unlike New York and San Francisco, Michigan’s ban of flavored e-cigarettes was not voted on. Instead, Gov. Gretchen Whitmer used her executive power to enforce “emergency rules” on selling the products immediately. Violators of these new rules could face six months in prison.
Why I’m conflicted.
Like many others, I don’t believe this vape ban will address the causes of this mysterious lung ailment. I subscribe to the theory suggesting black market THC cartridges are causing this spate of illnesses.
On the other hand, it’s never a bad idea to ditch your nicotine habit young. And unlike San Francisco, which banned the sale of all e-cigarettes, I doubt a ban on flavored products will turn the youth towards cigarettes.
Despite being conflicted, I can say one thing with confidence: Michigan’s ban is not in the interest of health, but instead a financial solution to severe tobacco settlement debt.
Tobacco Settlements, State Taxes, & CABs.
Following a 1998 legal settlement with Big Tobacco, many states began collecting millions of dollars from tobacco companies to reimburse healthcare costs associated with smoking. These yearly payments took the form of bonds.
The graph below shows how much each state collected in tobacco settlement payments last year in millions. Exact amounts for each state since 1998 can be found here.
Many states decided to collect their money in large lump-sum amounts at once rather than over time. They did so by issuing capital appreciated bonds (CABs). Simply put, the convenience of issuing CABs comes with a price. Governments will have to repay large amounts of money down the road, which is why states are currently in billions of dollars in debt.
These annual payments are adjusted according to inflation and level of cigarette sales. But who in the late 90s would have predicted that cigarette sales would ever decrease, let alone go below a static rate?
Where vaping becomes a threat.
Vaping is turning adults away from cigarettes and becoming the youth’s vice of choice before cigarettes enter the equation. The Pacific Standard reports that “cigarette sales are plummeting twice as fast as predicted when the CABs were sold.”
Less smoking means less payment. Less money to repay the debt piled up on CABs. Less per pack state tax collection.
And for Michigan, a state that’s taken loans against future settlements, this hurts their ability to take out new loans as well.
Why this matters.
Whether you are for or against the ban, there is something to be said about why governments are doing what they do. I don’t believe for a second that the Trump Administration’s plan for a national vaping ban is in the interest of saving children.
In actuality, blaming these flavored e-cigarettes for illnesses in the realm of legislation is puzzling to much of the scientific community. Thomas Eissenberg, the Co-director of the Center for the Study of Tobacco Products at Virginia Commonwealth University, says these regulations are not backed by scientific reasoning.
Michael Siegel, a professor of community health sciences at the Boston University School of Public Health, has good reason to think this legislation is being weaponized.
“Either they’re conflating them unknowingly, or they’re taking advantage of this outbreak to get policies passed that they otherwise wouldn’t be able to,” —Professor Michael Siegel.
As I’ve alluded to in other stories, a society that doesn’t question the FDA’s reporting and its subsequent law enforcement loses its cognitive liberty. The right to choose a vice, or a safer vice alternative, is more than a convenient “plus” of living in the U.S. It’s the right to control your health, consumer habits, and when dealing with psychoactive drugs (which includes nicotine), your state of mind.
Ali Shana is Palestinian-American freelance writer attending graduate school for Clinical Mental Health Counseling. He tends to report on psychopharmacology, drug policy reform, and healthcare-related issues. Follow his Twitter for more stories like this @AliReporting.
