Posted on Thu, Mar. 26, 2009
last updated: March 27, 2009 11:39:34 AM
WASHINGTON — Tobacco manufacturing jobs, which pay more than twice the average salary of other private industries in North Carolina, are "under siege" by tax increases and other government proposals, growers and their advocates told lawmakers here Thursday.
"The last thing North Carolina, or any state, needs right now is more lost jobs," North Carolina Agriculture Commissioner Steve Troxler said in written remarks to a House agriculture subcommittee.
The North Carolina tobacco crop was worth $686 million last year, and the industry pumped a total of $24 billion into the state's economy with more than 10,000 jobs.
Farmers and tobacco academics from large producing states testified on Capitol Hill about the possible ripple effects that regulating tobacco would have on local farms.
They are hoping to build opposition to legislation, which appears to have the support of a majority of both houses in Congress, that would give the Food and Drug Administration oversight over tobacco.
The farmers are backing an alternative bill, co-sponsored in the House by Rep. Mike McIntyre, D-N.C., who chaired Thursday's hearing, and in the Senate by Sens. Richard Burr, R-N.C., and Kay Hagan, D-N.C. It would set up a separate agency to handle the regulation, and according to McIntyre, is more explicit about keeping regulators off of farms.
"The last thing we want is for government bureaucrats to be coming on the farm," McIntyre said.
Rep. Henry Waxman, D-Calif., and sponsor of the FDA regulation bill, said his version has protections for farmers while giving authority to the agency.
"The bill provides numerous explicit protections for farmers, including language preventing the FDA from entering a farm without the farmer's written consent," he said through a spokeswoman. "Growers will also have a seat at the table in advising the FDA on any new standards that it sets."
A. Blake Brown, an agricultural economist at North Carolina State University, said tobacco companies have already lowered orders from farmers this year, anticipating a decline in demand since Congress increased the federal tax by 61 cents per pack to pay for a children's health insurance plan.
Brown said the price increase is likely to translate into a 6 percent reduction in smoking and a 2-3 percent cut in product demand from farms.
Efforts at “"arm reduction" — reducing the amount of tobacco in each cigarette and shifting demand toward smokeless products — would further lower demand for the types of tobacco grown on North Carolina farms, he added.
Nortrh Carolina Gov. Bev Perdue has proposed a $1 per pack increase to pay for budget shortfalls, and other states have had similar proposals.
Anti-smoking advocates, who didn't testify at the hearing, said reducing tobacco use will save money.
"Tobacco use costs the nation $96 billion a year in health-care costs and another $97 billion in lost productivity," said Matthew Myers, president of Campaign for Tobacco-Free Kids.
North Carolinians employed in tobacco manufacturing earned an average wage of $86,000 a year, compared to $39,000 for other private industry jobs, according to Troxler. The testimony of Troxler, who became ill and remained in North Carolina, was delivered by Graham Boyd, executive vice president of the Tobacco Growers Association of North Carolina.