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OCR Page 1 of 44Reed
Kaqan
THE WHITE HOUSE
scroles
WASHINGTON
April 9, 1998
4.3.48
MEMORANDUM FOR THE PRESIDENT
FROM:
Bruce Reed
Elena Kagan
SUBJECT:
McCain Legislation
With the overwhelming vote in favor of the McCain legislation in the Senate Commerce
Committee and the subsequent announcement of the tobacco industry that it will fight this
legislation, we have entered into a new phase of our effort to procure a comprehensive tobacco
bill to reduce youth smoking. The Commerce Committee vote last week brought new
momentum to this legislative effort. The industry's response should only add to that momentum,
by making it even harder for Members of Congress to block legislation, lest they look as if they
are doing the industry's bidding.
The broad consensus among your advisors is that we should aim for a strong,
comprehensive bill that meets our core public health objectives and that the industry might
reluctantly swallow in the end. Without industry consent, some provisions in comprehensive
legislation (i.e., the most far-reaching advertising restrictions) would be impossible, while other
provisions (e.g., narrower advertising restrictions and lookback penalties) would be in litigation
for years. We should not compromise our objectives to secure that consent, but at the same time
we should not ask for more than we need to achieve our public health goals and in the process
destroy any chance of industry acquiescence. In any event, most of your advisors believe that
efforts to push the price too far would be counterproductive, because tobacco-state Democrats
will join with Republicans to derail a bill that goes as far as some in the public health community
might like. Instead, we should try to address the aspects of the McCain bill that are most
important to us and to securing broad Democratic support.
Your advisors also agree that the best way to get this kind of bill is to engage in
negotiations with Senators Lott, Daschle, McCain, and Hollings that are designed to produce an
agreed-upon bill to go to the Senate floor. The greatest danger we face is chaos on the Senate
floor, in which some amendments roll back what we already have achieved (e.g., on FDA
jurisdiction), while other amendments make the bill essentially unpassable (e.g., by stripping all
liability protections while increasing the overall price of the deal).
We recommend against direct discussions with the industry at this stage; we doubt they
would level with us anyway. Assuming Senator Hollings is in the room, we should have a
decent sense of the industry's concerns, and of course we have more-than-adequate lines of
communication to the public health community.
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