Chapter

The Financial Costs to the States and the Federal Government

in Smoke-Filled Rooms

Published by University of Chicago Press

Published in print June 2002 | ISBN: 9780226857473
Published online March 2013 | e-ISBN: 9780226857480 | DOI: http://dx.doi.org/10.7208/chicago/9780226857480.003.0005
The Financial Costs to the States and the Federal Government

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The most costly litigation in U.S. history was the series of tobacco-related lawsuits filed by more than forty states and by the federal government. The extent to which one could conclude that the states and the federal government have incurred costs associated with cigarette smoking may depend in part upon which cost components are recognized in calculating the damages amount. This chapter explores the various cost components for the states as well as for the federal government to assess the governmental distribution of the insurance consequences of cigarettes. The courts' assessment of the costs of smoking depends critically on what they choose to recognize as cost components. Smoking affects the states in ways other than medical costs. Pension costs, nursing home expenditures, and other nonmedical components of state allocations are among these other cost effect categories. The net gains to the federal government from cigarette smoking are greater than those to the states. This result illuminates one potential reason why the federal government was not a party to the initial lawsuits against the cigarette industry.

Keywords: financial cost; federal government; cigarette industry; smoking; lawsuits

Chapter.  8459 words.  Illustrated.

Subjects: Company and Commercial Law

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