JIM LEHRER: Reaction now from two key negotiators of the original tobacco deal. Mississippi Attorney General Mike Moore and tobacco industry lawyer Phil Carlton, joined by congressional view, that of Senator Connie Mack of Florida, a member of the Republican leadership. Mr. Moore, can you stay attorneys general, accept the President's proposed changes?
MICHAEL MOORE, Mississippi Attorney General: Well, we were real happy today, Jim, that we've been working 90 days to get the President on board with this; we're glad to have him on our team now. We need him and, of course, we need Congress to get some action going. We worked on this thing for a real long time. I've been in it for four years, and frankly, our main theme is to reduce teenage smoking too. And we think we have a comprehensive plan here to do so. All those things I just heard Sec. Shalala ask for we already have them in the plan, so I was elated today to hear the President to say we like the plan, we want to tweak it a little bit, and make it a little bit tougher. And if he can do that, that's wonderful.
JIM LEHRER: So that's how you interpret this. He's adopting your plan. He just wants to tweak it a little bit?
MICHAEL MOORE: It's not how I see it. I've been at the White House every single day for the last year working with Bruce Lindsey and Bruce Reid in this administration I know exactly what we've been doing and we were working up until this very day, so I know what the penalties are. I know what the President expects. And we've been trying to get these guys to do some of those things. And we're going to get there. There's no question in my mind we're going to get there, and I think with the President's help we will.
JIM LEHRER: Mr. Carlton, do you see this as building on the agreement, or a scuttling of the agreement by the President?
J. PHIL CARLTON, Tobacco Industry Attorney: Well, I surely do. I heard the President say today that he wanted to embrace the June 20 agreement and to go forward from there. We are pleased to hear him say that. We agree with him that the whole goal and purpose here is to reduce the use of tobacco products by underage people. And we agree with him that it's not all about money, as some people would like for it to be. We don't agree with all the changes he has proposed, but we are ready now to work with the administration, with the attorneys general, and with the Congress to see a comprehensive national tobacco plan enacted into law.
JIM LEHRER: What about the basic point that Sec. Shalala just made that what the President wants is your industry held accountable for reducing teen smoking, can you accept that as a premise?
J. PHIL CARLTON: We have accepted that in the agreement of June 20. We have agreed--irrational as it is--unfair as it is--to pay a penalty of $80 million per percentage point that we fall short of reducing underage tobacco products, $80 million per point. Whether it's our fault or not, if we have done everything we've promised to do, as we will, and teenage use still doesn't come down, we are held accountable for that. I think that this industry has stepped up to the plate and accepted responsibility here way beyond the bounds that anybody ever imagined that they would.
JIM LEHRER: Well, Mr. Moore, what then is the President asking in addition, if that's already in your agreement, how do you--you've been there, you said. Interpret for us what he wants.
MICHAEL MOORE: Well, I think what the President is talking about today really is talking about getting the price up for a buck and a half, and I agree with Sec. Shalala. If the price goes up, you'll have some drop in teenage smoking because kids can't afford to pay as much for cigarettes. If the tobacco companies don't meet the goals of 30 percent and 50 percent and 60 percent, we asked them to pay a percentage point, $80 million per percentage point. We had a $2 billion cap. What the President wants to do is increase that. Maybe he wants to change that 80 to 160--maybe he wants to make it not tax deductible; maybe he wants to make it more of a penalty on them than it is now. And that's how the price goes up. So they're paying $15 billion a year. We're going to add another $2 billion in our agreement. And maybe what the President is saying, let's make the $2 billion $4 billion. They have not agreed to do that yet, but we're still working on them. And with the President and the Congress I think we're going to get to an agreement before it's all said and done.
JIM LEHRER: Going to get to you?
J. PHIL CARLTON: We believe that the June 20 agreement braces all that the President stated today in terms of his goal for a national tobacco plan. And we look forward to work with him to get it enacted.
JIM LEHRER: Do you buy the basic concept that if you raise the price, you reduce teen smoking?
J. PHIL CARLTON: That is just one factor out of many. The FDA last year, when it announced the new rules that it wanted to put in progress, said that its plan would reduce teenage smoking by 50 percent in seven years. And it did not have one penny increase in the price of a pack of cigarettes in it. So the FDA didn't think then that that was the only thing or any part of the proposal.
MICHAEL MOORE: Phil makes a good point, though, Jim. I hate to interrupt. But this is a point that nobody seems to get. That is true. And what we did in our agreement is we saw what FDA and the President proposed, a 50 percent reduction in seven years, with just a few restrictions on advertising and marketing. We took all the advertising and marketing away from them, then added a $500 million a year counter-marketing campaign, a national licensing program, and a cessation program, amongst many other things, that ought to do even more than what was earlier proposed. And then we put $80 million penalties on these guys. And I guess our mistake was we said eighty and everybody else wants one sixty, three twenty, or whatever it might be.
JIM LEHRER: All right. Well, let's bring Sen. Mack into this. Senator, you heard what Sec. Shalala has said. You now what heard what the state attorney generals have said and what the industry has said. Is Congress going to buy this?
SEN. CONNIE MACK, Republican Conference Chairman: Well, I think that Congress is going to respond and act on the initiatives that both the administration, the attorneys general, and the tobacco industry has been engaged in. But let me give you a slightly different perspective here. I've heard everyone, in essence, embrace and support the President for having apparently endorsed the plan, which from my perspective he has not endorsed, and let me begin by saying I want to extend credit to the administration for bringing an issue to the American people that should be discussed and should be debated--the importance of reducing tobacco use among our children must be done.
But I think that there are several areas where the administration is falling short. Specifically, I think the President should have come out with a more specific plan. After all, they said they were going to review this for 30 days. They ended up taking 90, and I don't really fault that. It's a very complicated issue. But I would have expected that the administration would have come forward and put a plan on the table. I mean, sure the Congress is going to make suggestions about how that should be changed, but because this is such a complicated issue, with all the different interests that are involved here, for the administration to kind of expect the Congress to act without some leadership on the part of the President I think is a big mistake. And the second point that I would make is I think that this needs to be looked at a little bit more comprehensively. I mean, people are properly focused on the problem of addiction, but what about the millions of Americans that are already addicted to tobacco, what about millions of people who are going to end up with diseases as a result of tobacco use, whether that's cancer, whether that's lung disease, whether that's heart disease, where is there hope for them in this agreement? Why isn't there a greater commitment? Why isn't there more specific commitment from the administration with respect to money going into medical research, and so those two areas I find troubling, and--
JIM LEHRER: No, go ahead. I'm sorry.
SEN. CONNIE MACK: Well, I find those troubling, and it seems to me that we ought to be putting money into research to see if we can't find some better treatment for the various diseases, if we can't find some way to reduce the pain and suffering that people go through as a result of the addiction as a result of tobacco use.
JIM LEHRER: And you believe that should be part of any final solution, in addition to trying to reduce teen smoking, et cetera?
SEN. CONNIE MACK: I believe it should, and I believe it can. As you probably know, Jim, Sen. Harkin and I introduced legislation or we proposed legislation last week, which we hope to introduce tomorrow, that would, in essence, deny deductibility of the payment under this agreement and that those funds should, in essence, be put into a trust fund and used by the National Institutes of Health to do exactly what I said a moment ago. We ought to be focusing on trying to find a cure. After all, I think everybody would agree there will be millions of more Americans in the future who are going to be hooked on tobacco use, and we ought to be trying to find better ways to treat the diseases caused by tobacco use.
MICHAEL MOORE: Sen. Mack makes a terrific point, and the point is that we need some money for research in the attorneys general agreement. We have $25 billion set aside at the request of the White House presidential trust fund just for that.
JIM LEHRER: Where's the money come from?
MICHAEL MOORE: It comes from the tobacco companies. It's in the agreement now. And I agree also with what he's saying; what the attorneys general are concerned about is 90 days did go by from the time that we gave the agreement to the President, and now that he's announced it, we're proud that he's there, but during that period of time, that's 3,000 kids a day, 270,000 kids have started smoking, since we gave this agreement, 90,000 people are going to die horrible deaths because we haven't done anything about the problem. Let me just finish. My point is that we've got to do something. I mean, everybody's talking and posturing and trying to one up the next guy. Kids' lives are at stake here. People's grandmas and grandpas are dying right now--let's do something--let's get together and do something.
JIM LEHRER: Senator.
SEN. CONNIE MACK: My only point to Mike was going to be--and again, I have complimented this administration, I compliment the attorney generals--the attorneys general--but the President is in the best position to bring the Congress together. As you know, there are all kinds of diverse interests up here. And if we just allow those to just kind of play off each other for the next several months, we're not going to get anywhere.
JIM LEHRER: What about Mr. Moore's point, that why can't the Congress just move on this, why does it have to wait till next year, what is the reason, the lack of presidential leadership is the only reason that Congress can't act?
SEN. CONNIE MACK: I think that clearly if the President had put a legislative proposal on the table, we would have been under a tremendous amount of pressure to get that done this year. As you know, Jim, we're still engaged with our own hearings here in the Congress and plus, as I said a moment ago, when you look at the House of Representatives, there's a wide range of interests that are talked about, that are presented in the Congress. We need something that forms a catalyst, and I believe that the best place to do that is with the administration.
JIM LEHRER: Mr. Carlton, what's your view, the industry's view of this as to--are you anxious to get this thing over with, move, get it done?
J. PHIL CARLTON: Anytime you have a proposed resolution that is as lengthy and complex and delicate as this one is negotiated by parties with variant interests it is by definition fragile. And when it is fragile, it runs the risk of unraveling with the passage of time. People's views harden when a new court decision comes down, or Mike makes a statement that upsets me or I make one that upsets him, and faces turn red. So the sooner we get--
JIM LEHRER: He's nodding with you.
J. PHIL CARLTON: The sooner we can get it done, the better.
JIM LEHRER: What do you say, Mr. Moore--I'm going to ask each of you this--what is the alternative to doing it this way? What is the alternative to this deal that you all have had?
MICHAEL MOORE: I appreciate what Sen. Mack and the President and everybody says about the attorneys general in saying we wouldn't be here without 'em. The truth is we wouldn't be here. If we hadn't filed these cases and brought the tobacco industry to justice frankly, we wouldn't be here. What I'm worried about now is we've brought this tremendous settlement, the greatest public health achievement in this century, to the Congress and to the President. I'm worried that so much time is going to pass that it will unravel and we'll miss this opportunity. If it needs to be strengthened, if it needs to be improved, gosh, we always thought Congress and the President, this powerful group of folks, could help us improve it and strengthen it, but let's don't let the opportunity pass.
JIM LEHRER: Senator, are you worried that this opportunity could be lost?
SEN. CONNIE MACK: Yes, I do sense that. And again my concern--and I want to get focused back on it--my concern is that this is an opportunity to see that money is focused in the area of research. Mike referred to a minute ago that there was 25 billion dollars. But that's over a 25 year period. We invest $13 billion a year now in the National Institutes of Health. Our goal is to double that investment over the next five years. Under the proposal that I have we could add about another four or five billion.
JIM LEHRER: But the bottom line, Senator, is, if I understand correctly, is nothing is going to happen on this in Congress until the new year, is that right?
SEN. CONNIE MACK: I think it is fair to draw that conclusion, that there is no legislation that has been put together and--
JIM LEHRER: Anybody working on it, anybody in Congress working on legislation?
SEN. CONNIE MACK: There are committees that are holding hearings that have jurisdiction that eventually will--I believe--would write legislation, but that's not going to happen overnight, and again, the way to kick start that is exactly what the administration did today on fast track. They didn't say you know Congress this is a difficult issue, you guys put it together; they came up here with a specific legislative bill to produce fast track authority for the President. He could have done exactly the same thing with the tobacco legislation.
JIM LEHRER: All right. We have to leave it there. Gentlemen, thank you all three very much.