Winners and Losers from the FDA’s Vaping and Cigar Crackdown

In the Food and Drug Administration’s crackdown on what is now a thriving market for vaping products (nicotine and flavorings delivered without tobacco through a vaporizing device), Trevor Burrus has identified one group that is likely to emerge as winners from the regulations, namely large tobacco companies, which have lost many smoking customers to the vaping market without being notably successful at playing in it themselves. Another set of winners? Governments whose treasuries are enriched by conventional cigarette sales. Under the 1998 tobacco settlement, which I and others at Cato have criticized at length, a large chunk of revenue from these conventional sales goes to state governments. But this revenue source has been eroded badly as smokers switch to vaping, a trend the new rules are well calculated to slow or reverse.

As often happens with bad regulations, the winners will not be nearly so numerous as the losers, some of which I identify in a new piece at Ricochet. Not to be forgotten are thousands of small businesses; independent vaping shops and small vaping suppliers have both become common in recent years, and face ruin. But the real target of restrictions on consumer choice are consumers, and in this case what is at risk is not flavors and gimmicks but lives and health. While the FDA (and its sister Centers for Disease Control under Obama appointee Thomas Frieden) are dismissive of the benefits of vaping as harm reduction for established smokers, many others in the public health field take it seriously. An evidence review published last year by Public Health England found that “the current best estimate is that e-cigarettes are around 95% less harmful than smoking,” and that while there was plenty of evidence that the vaping option had led to a lot of successful switching away from cigarettes, there was “no evidence so far” to bolster counter-fears that vaping posed a countervailing menace as a gateway for novices destined to graduate into cigarette smoking.  I conclude my piece

If Congress chooses, it can do something about this. An amendment approved by the House Appropriations Committee last month would grandfather in products now available, applying the prohibitive rules only to products introduced in the future. Whether Washington acts on this sensible idea will depend in part on whether it is listening to the voices of ex-smokers and young consumers around the country who feel competent to run their own lives and make their own choices.

As I note at Overlawyered, the FDA at the same time announced stringent regulations restricting the sale of cigars, which former Catoite Jacob Grier writes about here (““The market for cigars is about to become a lot less diverse and a lot more boring.”)