Page images
PDF
EPUB

Farmer's income

Farmers received $1.3 billion for the sales of tobacco crops, representing 8 percent of the total for all crops in the United States. The income from tobacco crops of the major States was:

North Carolina.......

Kentucky-

South Carolina___.

$564, 015, 000 | Virginia__--

277, 856, 000| Georgia.
116, 249, 000 | Tennessee---

$100, 885, 000

86, 894, 000 84, 043, 000

Other tobacco producing States include Alabama, Connecticut, Florida, Indiana, Louisiana, Maryland, Massachusetts, Missouri, Ohio, Pennsylvania, West Virginia, Wisconsin, and to a minor extent: Kansas, Minnesota, and New York.

Factories

MANUFACTURING

About 550 tobacco products factories, large and small, operate in 30 States. Cigarette production in 1963 is estimated to exceed 550 billion cigarettes.

North Carolina leads in cigarette production with an annual rate of about 325 billion. Virginia produces around 115 billion cigarettes annually, and Kentucky puts out over 90 billion.

Employment and wages

Tobacco manufacturers directly employ more than 96,000 men and women. In 1961, employees of U.S. tobacco manufacturers received $379 million in wages. Assets and stockholders

The net assets of publicly held tobacco companies total over $3 billion and there are over 300,000 stockholders of record of tobacco stocks.

COST AND SERVICES

All figures cited in this section are estimates from various sources.

Number of businesses

About 1.5 million businesses share in the tobacco trade supplying equipment, materials, transportation, and distributing and merchandising services.

Farmer's expense

Tobacco farmers paid about $155 million for hired labor and about half a billion dollars for other expenses such as $45 million for fertilizer and lime, $8 million for tobacco plant bedcloth, $2.5 million for twine used in tying tobacco, $1.5 million for tobacco seed, and $2.5 million for plastic covers used in plant beds.

Other services and supplies

In addition to the amounts paid for tobacco, wages, machinery, precision instruments, electronic equipment, wooden hogsheads, and cases used for shipping, the tobacco industry spent $25 million for cigarette paper and $79 million for transportation, mostly by truck, and annually uses over 40 million pounds of moisture-proof cellophane, more than 71 million pounds of aluminum foil, and nearly 27 billion printed packs and 2.7 billion cartons.

Wholesalers

DISTRIBUTION

Over 4,500 independent wholesalers handle the distribution of tobacco products, buying them directly from the manufacturer.

Retailers

Tobacco products are sold by more than 1.5 million outlets in the United States, including thousands of small retailers.

Exports

Over 28 percent of the tobacco leaf sold in free world markets in 1963 came from the United States-some 505 million pounds, up 36 million pounds from 1962, and valued at $405 million.

In addition, the United States continued to be the world's leading exporter of cigarettes-23.2 billion in 1963, valued at over $105 million, compared with $68 million 6 years ago.

Expenditure

In 1963 the total consumer expediture for tobacco products was $8.08 billion, a $326 million increase over the previous year.

More than $7.1 billion of the total expenditure was for cigarettes, up some $312 million over 1962.

Total excises

TAXES

Federal, State and local excise taxes on tobacco products in 1963 yielded $3.3 billion, more than three times the amount received by tobacco farmers for their crop. Over 98 percent of this came from excises on cigarettes.

In 1962, the $3,232,183,000 collected in excises on tobacco products, chiefly cigarettes, went to: Federal, $2,030,304,000; State, $1,129,879,000; and municipal, $72 million.

[blocks in formation]

Total U.S. cigarette and tobacco full-time workers___.

[blocks in formation]

Full-time cigarette and tobacco workers in North Carolina_.

Source: U.S. Department of Agriculture.

[H. Rept. No. 1135, 88th Cong., 2d sess.]

SMOKING AND HEALTH RESEARCH

The Committee on Agriculture, to whom was referred the joint resolution (H.J. Res. 915) to authorize and direct the Secretary of Agriculture to conduct research into the quality and health factors of tobacco and other ingredients and materials used in the manufacture of cigarettes, having considered the same, report favorably thereon with amendments and recommend that the joint resolution do pass. The amendments are as follows: On page 2, line 7, strike out "cigarette". Amend the title to read: "To authorize and direct the Secretary of Agriculture to conduct research into the quality and health factors of tobacco and other ingredients and materials used in the manufacture of tobacco products."

STATEMENT

House Joint Resolution 915 authorizes and directs the Secretary of Agriculture to conduct research into the quality and health factors of tobacco and other ingredients and materials used in the manufacture of tobacco products.

The resolution is presented to the House by a unanimous report from the Committee on Agriculture.

In public hearings before the Tobacco Subcommittee of the Committee on Agriculture the purposes and objectives of the resolution were supported by the Surgeon General of the Public Health Service, by the Associate Director of the National Cancer Institute, by the Director of Research and Education of the Department of Agriculture, the Governors and heads of departments of agriculture of the tobacco-producing States, by the spokesmen for general farm organi

zations, tobacco producers, and the tobacco industry entirely, by Members of Congress, and others.

The hearings were open to anyone who desired to make a statement and no person opposed the resolution.

On January 11, 1964, the Surgeon General of the Public Health Service issued a report, "Smoking and Health," presenting statistical studies from which an advisory committee formed the judgment that "cigarette smoking contributes substantially to mortality from certain specific diseases and to the overall death rate."

"Cigarette smoking," the report said, "is a health hazard of sufficient importance in the United States to warrant appropriate remedial action."

MILLIONS OF PEOPLE INVOLVED

Seventy million persons in the United States smoke cigarettes.

House Joint Resolution 915 recognizes that, notwithstanding the portentous report issued by the Surgeon General and irrespective of any repressive measures that might ensue, many millions of people will continue to smoke cigarettes. It acknowledges and accepts a Government interest and responsibility in the health of these people. It is appropriate remedial action.

This resolution seeks, through a crash research program, to give maximum assurances of health to these millions of our citizens who, weighing satisfactions against hazards, will make their individual choices to use tobacco.

The Secretary of Agriculture is directed to establish and place into operation at the earliest practicable date a special program of research into the production, handling, manufacture, and use of tobacco designed to ascertain and preserve the desirable quality factors and characteristics of tobacco products and eliminate therefrom factors, properties, or substances which may be detrimental to health. The Secretary is authorized to establish and operate laboratories and field stations.

THE COST OF RESEARCH

The resolution authorizes appropriation of such sums as Congress from time to time determines to be necessary. No limitation is placed upon this authority, but actual expenditures will be determined by the Congress through the control of appropriations.

Discussions during the committee's studies have indicated that the crash program can be launched effectively by an expenditure of $5 to $10 million.

The committee directs the attention of the House to the fact that the Federal Government now collects annually more than $2 billion in taxes upon tobacco products, and State bodies collect another $1 billion in taxes, so that the taxes upon tobacco yield to Federal and other public bodies twice the money each year as our farmers receive from the production of tobacco.

It is the judgment of this committee that the Federal Government which profits so richly from tobacco could use a very small part, a very infinitesimal portion, of its tobacco revenues to no better purpose than in a program, as embraced in this resolution, to protect the health of those who use tobacco.

COORDINATION OF TOBACCO RESEARCH

Mr. NATCHER. The question was raised in the committee as to what the tobacco industry, particularly the manufacturers of cigarettes, will contribute to the research effort that relates so intimately to the economic well-being of his industry. Conversations were held between the committee chairman and a representative of cigarette manufacturers, and it is the expectation of the committee that such manufacturers will contribute substantially, perhaps through the financing of laboratory buildings and facilities which may be staffed and operated in research directed by Federal, State, or educational bodies. While the resolution directs the establishment of adequate laboratory facilities, it makes no precise stipulation as to the location of such facilities. In addition to any new facilities, the Secretary is au

thorized to enter into contracts and agreements with State agencies, to expand or augment research work such as is now underway in Kentucky. He may enter such contracts and agreements with private interests, and he may use, on a reimbursable basis, the available personnel, facilities, and services of other Federal agencies and instrumentalities as he deems necessary.

THE NEED FOR FUNDAMENTAL RESEARCH

The study of smoking and health is in its infancy. We have now only statistical formations and judgments. We simply have counted the incidence of certain diseases among people who do and do not smoke. There are no fundamental research conclusions as to what it is in tobacco itself, if anything, that is injurious to health, and no studies whatever of other ingredients and materials-fruit juices, molasses, honey, etc., and paper-that go into the manufacture of cigarettes and other tobacco products.

Our people will not be satisfied with statistics alone as the guide to their preferences, decisions, and habits. The Surgeon General and the spokesman for the National Cancer Institute have emphasized to us the need for research, as directed in this resolution, to meet the challenge presented by the statistical conclusions and judgments in the report "Smoking and Health."

This resolution recognizes that the health of our people is a proper concern of the Government, and is paramount. (The resolution follows:)

[H.J. Res. 915, 88th Cong., 2d sess.]

JOINT RESOLUTION To authorize and direct the Secretary of Agriculture to conduct research into the quality and health factors of tobacco and other ingredients and materials used in the manufacture of cigarettes

Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That the Secretary of Agriculture is authorized and directed to establish and place into operation at the earliest practicable date a special program of research into the production, handling, manufacture, and use of tobacco designed to ascertain and preserve the desirable quality factors and characteristics of tobacco products and eliminate therefrom factors, properties, or substances which may be detrimental to health. Such special research program shall include authority to establish and operate laboratories and field stations, including the acquisition of land or interest therein, as determined by the Secretary to be necessary, so located as to relate the research studies and findings as closely as possible to typical soil, climatic, and environmental factors in the production and handling of tobacco. There is hereby authorized to be appropriated, without fiscal year limitation, for purposes of such special research program such sums as Congress may from time to time determine to be necessary. For purposes of this resolution, the Secretary of Agriculture may, notwithstanding other provisions of law, (1) use, on a reimbursable basis, the available personnel, facilities, and services of other Federal agencies and instrumentalities as he deems necessary, and such agencies and instrumentalities shall furnish such assistance to the Secretary; (2) enter into contracts and agreements with State agencies and private interests; and (3) accept contributions from non-Federal sources.

Amend the title so as to read: "Joint resolution to authorize and direct the Secretary of Agriculture to conduct research into the quality and health factors of tobacco and other ingredients and materials used in the manufacture of tobacco products."

COORDINATION WITH DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE

Mr. WHITTEN. Dr. Shaw, we realize that, with the problems tobacco has, one of the major things we have to keep in mind is that all agencies pull together. And I would appreciate it if, prior to reporting this bill, you will supply the committee for the record what the possibilities are of joint efforts at meeting these problems on a speededup basis in connection with a joint project with the tobacco companies, and also joint projects with Health, Education, and Welfare. I say here, that we have had a considerable part in providing the authority whereby Congress, if it sees fit each year, can make funds available from section 32 up to $25 million a year, to meet some of these specific problems. I don't bind the committee in this statement, but the provision is there, it is a continuing provision, and with that in sight we certainly hope that you will be able to come up with an approach for immediate attention to this problem over and above your contining research.

So if you would make that effort and check back with us, I think this committee would be willing to recommend financing to the point that you could probably use it. I would appreciate it very much if you will do that.

Dr. SHAW. We will be very glad to, Mr. Chairman.

I would like to point out that we have been in discussion with the Department of Health, Education, and Welfare, particularly their National Cancer Institute, but involving the other institutes as well, in terms of this problem, and we are both of the opinion, both departments, that to have a successful effort, it does require working together.

Mr. WHITTEN. What I am trying to do to strengthen your hand, and you are at liberty now to say you are sure that the House committee will support you with funds, within reason, to carry your share of the load. If you come prepared to finance your part, you will usually find the other fellow a little more receptive. I am sure the committee and Congress will back me in the statement I make to you. So if you do that, it will be helpful to us, because a crash program is needed.

I realize that with some of the manpower limitations that you have some of this will have to be by contract and some by grant. This committee has the means of financing these regular programs. Our purpose in the increases in production research and utilization research last year was to be able to put the money where the job is and get it done. So don't be adding this to the general fund of any general activity. I know you want to carry out the intent of the committee, but I say that for the record. Our intent wasn't to strengthen some overall national program, because there are places where we have done lots of that.

Dr. SHAW. We developed all of our plans on the basis of $10 million, on the nonrecurring bases.

Mr. WHITTEN. That way you control the use of it and you supervise the project and are in control of reporting the results.

Gentlemen of the committee, I believe that our committee would save time if we took the other witneses, Dr. Rodenhiser, Dr. Irving, Mr. Stephens, Dr. Clarkson, and Dr. Hilbert, and let them run through their various activities.

30-087-64-pt. 25

« PreviousContinue »