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SAIS Review 22.1 (2002) 87-96



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Treating Cigarettes as an Exception to the Trade Rules

Ira S. Shapiro


In the summer of 2000, the annual Tobacco or Health Convention held a debate centered on the international trade in tobacco. Specifically, the debate focused on whether the rules governing international trade inhibit nations from being able to adopt strong tobacco control measures. This question cut close to the central trade issue of the 1990s, namely, whether trade agreements and the World Trade Organization (WTO) system of trade rules overrode other important societal values, such as environmental protection, food safety, and public health. As a participant in the debate, I did not agree with the sweeping condemnation of the trading system, and welcomed the chance to debate the issue and point out what I believed to be the inaccuracies in the critics' views.

The debate paired me with Dr. Douglas Bettcher of the World Health Organization (WHO) against Rob Weissman of the Public Citizen's Essential Action group and Dr. Cynthia Collard, of Physicians for a Smoke-Free Canada. 1 I presented my argument that the WTO rules, particularly Article 20 of the WTO, 2 provided governments with far more latitude to adopt measures to safeguard public health than the WTO critics acknowledged. In my view, the fundamental impediment to tobacco control was not the international trade rules. Rather, it was the failure of governments around the world to find the political will to adopt strong tobacco control policies in the face of powerful tobacco companies. [End Page 87]

To bolster this point, I recounted the experience of the Clinton administration, which had substantially changed the U.S. government's position from that of its predecessors. The Reagan and Bush administrations had forcefully used the pressure of the U.S. government to open foreign markets, particularly in Asia, to U.S. cigarette exports. The Clinton administration stopped that practice and simultaneously sought to increase domestic regulation of tobacco products. This policy reversal precisely illustrated my argument. The nations of the world were not in the grip of forces beyond their control, either because of the trade rules or "globalization." Too many governments were simply failing to put the public health concerns of their people above the commercial interests of the tobacco companies and of those who make their living from growing tobacco.

I still believe that the argument I presented in that debate is valid. Governments are not powerless. Indeed, they do have the latitude necessary to protect their citizens through strong tobacco control measures. But as I listened to my opponents in the debate and reflected on the issue later, it became increasingly clear to me that I had focused too much attention on the workings of WTO provisions, and not enough attention on the actual problem: the unique nature of the product in question. Smoking is the leading preventable cause of death and disease in the world. About half of all long-term smokers die of diseases caused by their addictive habit. The very fact that tobacco products are so lethal, even when they are consumed in a "normal" way, sets them apart from other products in commerce, and requires that they be treated as an exception to ordinary trade rules.

Should Harmful Products be Freely Traded?

It is often said that the only thing that all economists agree on is that free trade is beneficial. The benefits of trade expansion have been repeatedly documented. There is no doubt that trade expansion is an engine of economic growth. Recognizing that reality has prompted virtually all the nations of the world to conclude that the path of open markets and expanded trade provides the best hope for economic growth for their people.

The general benefits of free and open trade are well known. As trade liberalizes, consumers benefit from lower prices, greater competition, more vigorous marketing, and greater economic efficiency. In many cases, freer trade spurs innovation and the adoption [End Page 88] and dissemination of new technologies. All these factors lead to an increase in production and consumption of...

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