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Thursday, January 06, 2011

E-Cigarettes

Over on the Lone Wolf blog I posted about e-cigarettes.  You can read there about what they are and how they work.

What interests me here is the reaction to these devices.

Now first off let's be clear.  There is no burning of tobacco - no smoke.  Instead nicotine infused steam or water vapor is created inside the e-cigarette and that's what you breath.

This has been studied in New Zealand (read this).  The report Summary says: "It is very safe relative to cigarettes, and also safe in absolute terms on all measurements we have applied."

As for the US you can download the full PDF here from the Surgeon General's website.  This is a long, tedious read about the hazards of breathing combustible materials.  Even the nicotine addiction section is tied to this.  I would imagine that no one is surprised to read that breathing smoke is bad.  Everyone knows this: smokers and non-smokers alike.  Unfortunately the government has spent a lot of money and time discovering and validating the obvious.

One imagines that, for example, firefighters would find this an important read because most of what is discussed about smoke and breathing smoke is generally true.  Apparently studying the effects on smoke on those people chronically exposed as part of their job is less important.  (As anyone who burns common paper household trash can tell you there is far, far worse involved than mere smoke.)

Then there is the FDA.  They have attempted and failed to have shipments of these products to the US banned or stopped at the boarder.  The FDA contends these are "drug" devices and must be subject to extreme regulation and control by the FDA (as opposed to, say, hypodermic needles, which you can buy by the dozen's in any drug store).

The problem here is really very simple.  All of this is about two things: money and control.

No one believes that smoking is good for you.

However, smoker's are addicted to two elements of smoking: the "hit" of the smoke from the drag and the nicotine.  E-cigarettes offer both - the vapor as the "hit" as well as the nicotine.

Nicotine is, in any significant quantity, a dangerous chemical.  In most of the rest of the world its used as an insecticide.  In small quantities, like those found in both tobacco and cigarettes, its dangers are much less clear.

A quick check of Wikipedia indicates many common elements between nicotine and, say, caffeine.  Both are alkaloids, both affect mood, both are consumed world wide in enormous quantities, both are mildly addictive to some degree, and on and on.

Sales of cigarettes in the US for 2005 was some 378 billion cigarettes which comes out to $180 billion dollars US at a retail price of $5/pack - which is probably around one percent (1%) of the US economy.  Another 1% of the economy covers the cost of treating smoking related health issues.

There are claims that "lack of productivity" caused by smoking costs around $100 billion USD per year but I think that number needs to be compared to the reality of eliminating cigarettes and any associated productivity losses associated with that to be meaningful.

The reason e-cigarettes are so popular is that cigarette prices are highly inflated by taxes.  Cigarettes in other countries where taxes do not play as much of a role is significantly less.  US states like New York can garner as much as $5 - $7 dollars a pack in taxes.

With e-cigarettes you can happily vape away for about $100 a year without paying any US taxes.  In a state like New York that probably means about $5,000 USD less a year per smoker in state tax revenue.  Given New York's tens of billions in budget shortfall you can see one of the reasons government is so interested in stopping e-cigarettes (200,000 smokers = $1 billion in annual cigarette taxes lost).

Then there is the control aspect.

The FDA believes that its role is to ban not only smoking but also the concept of smoking, i.e., its not good enough to control what you do, but you cannot be allowed to even want to smoke.  (Read the Surgeon General's report if you don't believe this).

The problem here is two fold.  First there is tax revenue and corresponding money spent on smoking remedies.  While on the one hand the government claims to want to ban smoking banning smoking successfully will strangle many state budgets because, as hard as it is to imagine, all those big dollar tobacco settlements won over the last decades are not sitting in banks waiting to pay for the cost of smoking related illnesses.  No, like social security, the states have long since spent that money and rely on direct tax collection of tobacco taxes to survive.

Second the FDA needs to control tobacco in order to manage the tobacco market relative to its big-tobacco friends in the industry (after all, their collective $180 billion dollar market is in significant danger if e-cigarettes go off the existing "tobacco control range").

Secondly, without a crusade, like tobacco, there is less for the FDA to do.  With less to do budgets shrink (just look at the hundreds of government funded studies in the Surgeon General's report).  So, though Congress told the FDA it can regulate but not ban tobacco, the FDA struggles to make itself relevant on the e-cigarette front.

All this said let's compare cigarettes to other "drug related" industries.

I would estimate that about 1,000 metric tons of cocaine is produced annual.    A metric ton is 1,000 x 1,000 grams (1,000 kilograms) or one million grams.  With a street price of $100 a gram that $100 million dollars per metric ton (more if the cocaine is cut).  Given 1,000 metric tons that's about $100 billion USD in manufactures cocaine sales - probably two or more times that retail on the street.

Now in the US a 100 billion dollar company is going to employ at least 50,000 workers - probably many more.  So one imagines that the same relationship must be true for cocaine.  Yet while there are lot of small scale arrests there are relatively few large-scale arrests (maybe 5,000 per year for trafficking - but I am having a hard time figuring this out).

At any rate while the FDA would happily shut down any US tobacco company at a moments notice for some trivial reason or other they apparently cannot manage to get their hands around the illegal drug trade's throat no matter how hard they try (I wonder if this is because government is full of baby boomer dopers who really don't want to see recreational drug use actually eliminated?)

Now if you add in cannabis, heroin, meth, etc. and other legal drugs used illicitly you will see that these industries employ a lot of people and are very, very large (like on the order of Mobil-Exxon for each type of drug).

The point of all this is that "clamping down" in terms of the FDA means at least a $100 billion dollars per year in annual sales - so clamping down on e-cigarettes (or cigarettes in general) would probably (actually) be a huge boon for the market.  Not to mention it would cut $100 billion out of state cigarette sales taxes.

The bottom line is that the FDA is grasping at straws: trying to get the cat back into the bag.

But I think its too late.  I have heard, but cannot confirm, as many as 30K people are converting per week to e-cigarettes (I wonder if this is because the FDA told them smoking was bad for them?)

Bottom line for me?

- E-cigarettes are far less dangerous than smoking regular cigarettes.

- Government and big tobacco are going to work very hard to protect their slice of the revenue and control pie.

- The FDA and state tobacco tax collections are going to go head-to-head for you cigarette tax dollars - its unclear to me who will win this battle.

- Banning e-cigarettes in hypocritical nonsense if you believe smoking regular cigarettes is bad.

- The FDA controlling tobacco and/or e-cigarettes to much will simply yield yet another giant criminal industry on the order of Exxon-Mobile.

- FDA regulation = means to tax.

- No one really knows what things like ionophores or genetic engineering might be doing to us and our food supply - but killing off smoking is apparently far more important to the FDA than stopping, or even studying, something that the entire general population has A) no control over, B) is not analyzed in anywhere as much, and C) is in virtually every food product we consume.

At the end of the day illegal drugs, tobacco, and alcohol probably make up a very large portion of the economy - on the order of health care at one sixth.

Perhaps the FDA should simply hire tobacco company execs to work there - after all they do hire big food execs - and magically there is not investigation or problem with genetic engineering or commercial chemicals with very little safety study.

Right or wrong smoking what people choose to do with their money.

(Again, I think that big government workers are liberally minded and see tobacco as evil and smokers are dull thugs unable and unwilling to think for themselves.  On the other hand, they see things like pot and so forth as enlightened recreational activities when properly used - after all, that's what they were told in the 1960's.  As I said - its what people choose to do with their money.)

But big nanny government knows you are too stupid to take care of yourself so they plan to do it for you.

Personally I think that all the tobacco settlement money states sued for should be required by law (or lawsuit) to be held aside for future tobacco health costs.  If the states cannot do this they are simply hypocritical liars who are out to take your money..., erh, ah, profit from your smoking habit.

Its a good thing we have exercised morality from our modern social conscience - otherwise someone might notice what's going on that think it was, gasp, wrong...

2 comments:

jessica robert said...

In Electronic Cigarettes there are no burning of tobacco - no smoke. Instead nicotine infused steam or water vapor is created inside the e-cigarette and that's what you breath.

Fawad Tariq said...

The Vapor King vapor cigarette successfully removes many of the downfalls typically associated with smoking Electronic Cigarettes Say goodbye to smokers breath, yellow teeth and the smell of smoke on your clothes. You can also get rid of all that smoking paraphernalia including lighters, ashtrays and cigarette butts.