Friday, February 4, 2011

Maryland and the Tobacco Law Suit

Maryland and the Tobacco Law Suit
Al Ritter

In 1997 Tobacco manufacturers made a settlement through the US Attorney General to pay states a specific amount for damages caused by smoking. Now mind you, Maryland is playing both ends against us. What does this mean? Well Maryland knows that smoking costs everyone in healthcare costs, but accepts money from the sales of cigarettes ($1.20 per pack) AND accepts money from the settlement.

How much you ask? Well back in 2008 the amount was $540.8 million, but that amount increases yearly based on a variable scale based on inflation. The amount now is largely contested but the expenditures aren’t. Maryland spends very little, in fact one of the lowest states in the nation on smoking cessation programs.

The original settlement with the tobacco companies stated that these funds would be used exclusively on treatment of smoking related illnesses or smoking cessation programs. Unfortunately this is where state sovereignty takes over, and through Maryland law the general assembly decides how that money will be spent.

For argument sake let’s say that the yearly income is still at $540.8 million a year, and we have NO idea how much Maryland takes in on taxes on cigarette sales, but rest assured it is massive. We are now half way through the original settlement of 25 years, so we only have 13 years left of the $540.8 million per year income left. Maryland has thrown this money into the general slush fund, and spends little (3% at last reporting) on smoking prevention.

My question is this…….Maryland has become increasingly dependent on Federal funding (Stimulus), and earmarks through Senators Mikulski and Cardin. Add that to the tobacco settlement and you can see we have had it pretty easy in Maryland compared to other states.

Political retribution on the ability to secure federal funds has been no secret in the Obama Administration. If the winds of change happen in Washington according to the general consensus in 2012, funds from the federal government will surely dry up. O’Malley has done his best at “making hay” while the opportunity has afforded itself.

O’Malley doesn’t care what happens in the last two years of his reign of terror, he will be gone in 2014. Maryland will receive the tobacco settlement long after he is gone, but certainly not indefinitely.
The General Assembly has been hooked on money, especially money they never earned. When the federal money, and the tobacco money dries up whom do you think will have to make up the difference in income?


barb p said...

Hmmm, don't I just wonder who?

turk182 said...

I'm sure the politicians will get hooked on the money like a drug addict gets hooked on crack, and the citizens will end up paying the difference