Summary: In June 1997, the nation's largest tobacco companies and 40 state attorneys general who had filed suit against the industry agreed on a settlement that, if implemented, would significantly change the way that tobacco products are manufactured, marketed, and distributed in the United States. Under the proposed agreement, the industry would pay $368.5 billion over 25 years, accept the Food and Drug Administration's authority to regulate tobacco products, restrict the advertising of its products, and release internal research papers. In return, the settlement would resolve the present actions by the 40 state attorneys general, drop all punitive damages claims for past conduct, and grant the tobacco industry immunity from future class-action lawsuits. This report (1) identifies tobacco-related industries and summarizes existing studies that assess the national and regional economic impacts of the tobacco industry, (2) examines smoking trends for U.S. and Canadian youths, (3) estimates the potential effect of a settlement on state revenues from cigarette excise taxes, and (4) investigates the extent of interstate and international cigarette smuggling affecting the United States.
