Even in flush times, $3 billion isn’t exactly chump change. As states continue to climb out of the hole dug for them by the recession, it’s a huge amount of revenue.
Or rather, lost revenue. Three billion represents the amount states lose because of cigarette smuggling. As The Times-Dispatch’s series on the problem makes clear, cigarette smuggling is a leak in the fiscal bucket states across the country struggle to fill.
But that is just one of the problems it causes. Smuggling also brings with it organized crime, violence — through, e.g., the hijacking of cigarette shipments or simple robbery — and perhaps even the funneling of smuggling revenue to groups with terrorist ties, although so far few of those asserting such a connection have provided the public with much evidence to back it up.
People are also reading…
Cataloging the miseries inflicted by cigarette smuggling, unfortunately, is easier than finding a solution to it. One obvious answer might be to raise tobacco taxes in low-tax states, such as Virginia. But tobacco taxes are highly regressive, since smokers tend to be poor. What’s more, the smuggling problem was created by the decision to raise tobacco taxes to outlandish levels in places such as New York. Why should Virginians have to pay more to fix a problem New York created?
Virginia lawmakers clearly don’t think they should. If they view the tobacco racket with any kind of alarm, it is largely muted. Does that mean they’re “soft on crime”? Not exactly. But it does mean their concern apparently doesn’t match the gravity of the problem. Sometimes it takes a tragedy to capture the attention of the political class. (Think of how the Virginia Tech massacre galvanized action on mental-health reform, for instance.) We hope it doesn’t come to that.
Besides, addressing the issue doesn’t require a domestic version of the Patriot Act, or anything like it. The best hope for combating cigarette trafficking is probably a long-term one: the reduction of smoking rates overall.
In that regard, Virginia could do better. Over the years, Virginia’s tobacco commission, created to oversee funds disbursed through a master settlement agreement between tobacco companies and states attorneys general, has lavished funds on all manner of projects — some of them, no doubt, quite worthy — but precious little on smoking prevention.
According to a 2013 report by the Campaign for Tobacco-Free Kids, Virginia spent just $8.4 million that year on tobacco prevention, compared with nearly $300 million tobacco companies spent here on marketing and more than $2 billion in tobacco-related health expenditures. That’s less than 10 percent of what the Centers for Disease Control and Prevention recommends. Most states, unfortunately, have similarly poor records.
Even if the CDC recommendations are overly ambitious, it’s clear that Virginia and other states could be doing more to discourage young people from lighting up. Of course, discouraging smoking will also deprive states of even more revenue than smuggling does. But as a matter of public policy, it’s far preferable to a focus on smuggling alone.