The 2017 Tax Cuts and Jobs Act (TCJA) was the biggest accomplishment of the Trump administration and the 115th Congress. As several key provisions of the TCJA have already expired, others are set to sunset in 2025, the Senate must act swiftly to bolster competition and provide needed relief. In January of this year, the House Ways and Means Committee reported the Tax Relief for American Families and Workers Act (TRAFWA) with an overwhelming bipartisan vote of 40-3. When it came to the House floor, 357 members voted in favor of it. The TRAFWA would reinstate research and development (R&D) expensing, a provision responsible for a $2 trillion investment explosion after the passage of the TCJA. It would also provide valuable relief for small businesses by increasing the caps on businesses expensing and the reporting threshold for subcontract labor. Additionally, it will eliminate wasteful, fraud-ridden programs like the COVID-era employee retention tax credit. It is now time to bring this legislation to the Senate floor before Tax Day.
Zynfully Misinformed
In January, Democratic New York Sen. Chuck Schumer, called on the Food and Drug Administration (FDA) to investigate a product called “Zyn,” due to supposed concerns about marketing and health effects. Zyn is a brand of nicotine pouch that resembles a small teabag and contains plant-based fibers infused with nicotine. It isn’t smoked, it does not contain any tobacco, and presents almost none of the known risks of combustible cigarettes. And yet, anti-smoking organizations are still trying to get it taken off shelves. Despite recent data from the FDA and CDC indicating that nicotine pouch use among youth is “exceptionally low,” anti-tobacco hardliners are already raising the specter of youth use in their attempt to create a similar moral panic to the one they created about vaping products. News sites have been awash with scary clickbait articles, eagerly supported by the anti-smoking industry willing to offer prognostications of doom. One example (out of very many) is Health News Florida, which reports that “[h]ealth advocates fear Zyn, like e-cigs, may catch on with teens due to its addictive nicotine.” Kathy Crosby, CEO of the Truth Initiative, a group that claims to be working toward the end of smoking, yet is bitterly opposed to any lower-risk alternatives to smoking, was happy to be the convenient “concerned” spokesperson. It should be noted that Crosby left an executive-level position at the FDA’s Center for Tobacco Products to join Truth, the same agency that has authorized only a handful of reduced risk tobacco products over the past half decade.
Instead of being interested in the potential of novel nicotine products to help transition people who smoke from combustible tobacco (which will likely kill them) onto products that likely won’t, the instinct is always to ban first and ask questions later. This is not a new phenomenon. As The Local Sweden reported recently, “[a]ccording to the [Swedish] government, snus has helped slash the number of smokers from 15 percent of the population in 2005 to 5.2 percent last year, a record low in Europe.” This success is unavailable to other countries in the EU because snus — a product like nicotine pouches but containing pasteurized tobacco purged of carcinogens — was banned in all member states in 1992 following a moral panic led by shroud-waving anti-smoking campaigners. It didn’t matter that it had been used in Sweden for more than 200 years or that there were decades of research showing negligible risk compared to combustible cigarettes. Japan has experienced a staggering 50-percent collapse in cigarette sales since heated tobacco — a vastly less harmful product than combustible tobacco — was introduced to the nicotine market in 2016. This collapse of the market happened despite the Japanese government’s disapproval and attempts by anti-smoking organizations worldwide to stop this new technology.
Zyn has only been on the U.S. market since 2014, but Johns Hopkins University is quick to express certainty that the product “can be addictive and cause cardiovascular issues.” Note the sowing of doubt by the same university when faced with vaping, which has not caused any major health problems anywhere in the world in more than 20 years. In that case, they claimed that “[b]ecause vape products are still relatively new, it’s difficult to ascertain the scope of long-term health effects on users.” None of these anti-smoking voices seem remotely concerned that the FDA has authorized 212 combustible tobacco products to be sold in the U.S. since Aug. 2020. Instead, they are incensed that by the same process (and in the same timeframe) the FDA has authorized just 23 e-cigarettes – from over six million applications — which pose a tiny fraction of the risk of combustible tobacco. Vapes, heated tobacco, snus, and nicotine pouches (including Zyn) all have the potential to significantly reduce harm from smoking by competing with traditional cigarettes. Yet it is anti-smoking organizations that are fighting hard to eradicate them.
It’s still possible to create an America in which most nicotine users get their buzz via reduced-risk options, rather than through smoking, which kills 480,000 people every year. Sadly, the debacle over Zyn has shown it will not happen while anti-smoking advocates continue their strenuous efforts to prevent it.
A Bad Legal Roundup
In the intricate medley making up the American economy, the tort system reigns supreme, wielding significant influence and hefty costs. The U.S. Chamber of Commerce estimates the nation’s tort system cost the U.S. economy $443 billion in 2020, a sum equivalent to more than 2 percent of the entire U.S. GDP, which serves as a stark testament to its economic significance. Far too much of that staggering amount comes not from legitimate suits helping injured parties, but from mass tort litigations engineered by rent-seeking attorneys. These lawsuits (often involving thousands of claimants) are fueled by an insidious cycle of television and internet advertising spending designed to find potential claimants. These flashy and misleading ads promise big payouts for people who think they might have suffered harm from a product, whether it be a pharmaceutical drug, medical device, or other consumer good, even if the link between the targeted product and any real harm is dubious at best. The reality of the litigation generated is that trial attorneys are the only ones who profit from these lawsuits, while often leaving little to no earnings for the victims. Some estimates indicate that unsupportable claims comprise up to half of mass tort litigations.
The scripts of the ads, meticulously written to bring in the maximum number of participants, frequently peddle allegations that are often based on junk science or speculation not backed up by fact. The litigation centered on the weed killer Roundup is a great example of how this broken system operates. Roundup, manufactured by the Monsanto Company (which was acquired by the German conglomerate Bayer AG) is an herbicide widely used by farmers and gardeners. When a branch of the taxpayer-funded World Health Organization (WHO) deemed Roundup’s active ingredient to be possibly carcinogenic to humans, mass tort litigators went to work. They hired firms specializing in lead generation to find cancer victims who might have been exposed to it. Their advertising targeted said victims. Three years later, almost 43,000 potential claimants were involved in lawsuits targeting Bayer, the result of more than 625,000 TV advertisements seeking potential clients. But the connection between Roundup and cancer is debatable at best. Bayer pointed to hundreds of studies and regulatory decisions that didn’t find a link to the disease. Roundup continues to be approved for use in the U.S. and abroad. Bayer contends that plaintiff lawyers cherry-picked company emails and documents pertaining to past research to support their lawsuits. This is not out of the ordinary for the WHO. The organization has a track record of using questionable science to promulgate regulations. For example, the WHO placed bacon and hot dogs in the same category of cancer-risks as smoking cigarettes. Junk science paired with the backing of an internationally recognized organization like WHO, made it a key asset for ambulance-chasing attorneys.
Trial lawyer advertising (often funded by Wall Street investors) has reached epic proportions. One study found that television legal advertising in 2021 compromised more than 15 million commercials, with spending levels topping $1 billion annually. Between 2017 and 2021, $6.8 billion was spent on more than 77 million national and local ads. The more they spend, though, the more they make. Settlement and judgements can be worth billions of dollars, which lawyers and investors split between themselves before the actual plaintiffs, the allegedly injured parties, are paid. It’s not unusual for individual claimants to realize insignificant proceeds from their suits in the end. To rein in profit-motivated mass tort litigation, the American Tort Reform Association recommends multiple legislative and procedural solutions. They believe states should pass reasonable regulations to curb misleading or deceptive legal advertisements. In addition, it needs to be ensured that judges and juries have access to complete and accurate evidence that will help them render sensible judgements, as will strict adherence to Federal Rule of Evidence 702, which requires that theories be based on sound scientific method. Civil tort litigation is an essential part of the American legal system. But it cannot continue to be abused for the benefit of greedy attorneys and their investor partners. The imperative for reform is undeniable, as the integrity of the justice system hangs in the balance.
BLOGS:
Monday: It Is Impossible to Human-Proof AI Models
Tuesday: Texans Get Toasted on new ESG Rules
Wednesday: New Medicare Advantage Rule Threatens Beneficiary Choice and Affordability
Thursday: Commercializing Spectrum Is Crucial to America’s Economic and National Security Interests
Friday: Tax Fact Friday: The Tax Code Is 74,000 Pages Long
Media:
March 18, 2024: WBFF Fox45 (Baltimore, Md.) interviewed me about taxpayer funding for Pimlico Racetrack.
March 18, 2024: The Daily Caller ran TPA’s op-ed, “Zyn Outcry Exposes Anti-Smoking Orgs Fighting To Protect Cigs From Competition.”
March 18, 2024: WBFF Fox45 (Baltimore, Md.) quoted TPA in their article, “Baltimore judge rules Mosby Legal Defense Fund donor names can remain undisclosed.”
March 19, 2024: WBFF Fox45 (Baltimore, Md.) interviewed me about transparency issues with Nick Mosby’s legal defense fund.
March 19, 2024: Townhall.com ran TPA’s op-ed, “The Cautionary Legal Tale of Roundup.”
March 19, 2024: Fox Business quoted TPA in their article, “Elizabeth Warren leads renewed charge for wealth tax on ultrarich.”
March 20, 2024: WBFF Fox45 (Baltimore, Md.) interviewed me about Baltimore County’s public health officer.
March 20, 2024: Russia News Now quoted TPA in their story, “Liz Warren And Socialist Pals Want To Normalize Confiscation Of Assets With ‘Ultrarich’ Tax.”
March 20, 2024: Zero Hedge quoted TPA in their story, “Liz Warren And Socialist Pals Want To Normalize Confiscation Of Assets With ‘Ultrarich’ Tax.”
March 21, 2024: WBFF Fox45 (Baltimore, Md.) interviewed me about the cost overruns with the Purple Line.
March 21, 2024: I appeared on WBOB 600 AM (Jacksonville, Fla.) to talk about the EPA’s new carbon emission rules.
March 21, 2024: Patrick Hedger appeared on American Family News radio to talk about the EPA's new carbon emission rules.
March 21, 2024: American Family News mentioned TPA in their article "Market Realities Remain Ignored."
March 21, 2024: WTCM-AM (Traverse City, Michigan.) quoted TPA in their story about wealth taxes.
March 21, 2024: Issues & Insights ran TPA’s op-ed, “U.S. Postal Service Stonewalls FOIA Requests.”
March 22, 2024: Florida Daily ran TPA's op-ed, "Cutting Waste on Telecommunications Services."
March 22, 2024: Filter Magazine ran TPA's op-ed, "Heated Tobacco Products Can Help the US Make Smoking Obsolete."
Have a great weekend!
Best,
David Williams
President
Taxpayers Protection Alliance
1101 14th Street, NW
Suite 1120
Washington, D.C. xxxxxx
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