Abstract
This document is a proposal to the Tobacco Institute from a California consultant which discusses a plan to help the industry defeat cigarette tax proposal in California in 1982-83. The consultant discusses mobilizing Libertarians on behalf of the tobacco industry, a technique that the industry has been using increasingly in the late 1990's and into early 2000's:
"Assuming the cooperation of leadership in the Libertarian Party, we can stimulate at least a modest letter writing program among Libertarian activists throughout the state. We recommend some financial assistance directly to the Party to help offset the cost of mailings to their members requesting action on the legislation in question. It would also be wise to employ a key Libertarian leader as a consultant to this effort..."
The proposal also discusses how the industry could clandestinely persuade citizens who are anti-tax (but who may also oppose tobacco on the grounds of their religion) to vote against the proposed tax:
"D. MOBILIZING TAX OPPONENTS
There is a great body of persons in California who are against taxes...period.
...We believe this group is a ripe target for a program which asks them to contact members of the legislature.
The key to success among this group is to stay away from the specific issue of taxes on tobacco products. Many of these persons are fundamental Christians or members of the Church of Jesus Christ Latter Day Saints. Discussing the tobacco aspect of the proposal would be counterproductive.
Therefore, a mailing to this group would attack the waste in government today and the need to cut existing excesses, rather than continue the tax-and-spend syndrome of the past. It would also give examples of how some excise taxes are particularly cruel on the elderly, etc."
Fields
- Quotes
(from Page 8, Bates No. 03676092):
B. MOBILIZING KNOWN ALLIES
Outside of the TAN [Tobacco Action Network} organization there are a number of individuals who are sympathetic to our cause. Among them are the Libertarian Party, which is generally opposed to all taxes, but expecially to excise taxes...
Assuming the cooperation of leadership in the Libertarian
Party, we can stimulate at least a modest letter writing
program among Libertarian activists throughout the state.
We recommend some financial assistance directly to the
Party, to help offset the cost of mailings to their members
requesting action on the legislation in question. It would
also be wise to employ a key Libertarian leader as a
consultant to this effort.
Generally speaking, Libertarian activists are considered to
be out of the mainstream of political activity. Therefore,
we would encourage them to write as consumer/taxpayers, not
as political ideologues...
(From page 12, Bates No. 03676095):
D. MOBILIZING TAX OPPONENTS
There is a great body of persons in California who are
against taxes...period.
...We believe this group is a ripe target for a program which asks them to contact members of the legislature.
The key to success among this group is to stay away from the
specific issue of taxes on tobacco products. Many of these
persons are fundamental Christians or members of the Church
of Jesus Christ Latter Day Saints. Discussing the tobacco
aspect of the proposal would be counterproductive.
Therefore, a mailing to this group would attack the waste in
government today and the need to cut existing excesses,
rather than continue the tax-and-spend syndrome of the past.
It would also give examples of how some excise taxes are
particularly cruel on the elderly, etc.
(From page 12, Bates No. 03676096):
E. STIMULATING FRIENDS IN THE NEWS MEDIA
Much of the California news media is unsympathetic to the
tobacco industry. However, there are also a significant
number of individual reporters, columnists, editors, and
publishers who are viscerally opposed to unfair taxation.
Among them are syndicated columnist Earl Waters, San
Francisco Chronicle columnist Abe Melenkoff, Register
editorial editor Tim Ferguson, and Fred Kline, Executive
Editor of the Capitol News Service.
We can develop several articles favorable to our position by
a quiet program of individually talking with selected
friends in the news media. We would strongly encourage that
any blanket coverage of the press be low key, factual, and
well timed, so that such efforts not stimulate more enmity
than sympathy.
Articles and editorials can be mailed to legislators by TAN
members to remind them that this issue is a matter of
concern to many people. While such articles might not be
compelling in and of themselves, they certainly will help
buttress other aspects of the mobilization program.
It would also be wise to provide low key briefing papers to
newly elected legislators, similar to the kit sent to the
general news media.
- Company
- Lorillard
- Author
- Nelson, R.E.
- Padberg, E.E.
- Recipient
- Kelly, J.
- Region
- California
- Named Organization
- Capitol News Service
- Ca Independent Public Employees Cou
- Church of Jesus Christ Latter Day S
- Group Against Smoking Pollution/Group to Alleviate Smoking Pollution? ("GASP)" (Group Against (or to Alleviate) Smoking Pollution)
A not-for-profit corporation founded in 1976 as the California Group Against Smoking Pollution (GASP). Now there are several state branches of GASP around the country.
- Libertarian Party
- Orange County Employees Assn
- Register
- San Francisco Chronicle
- Senate Finance Comm
- TAN (Tobacco Action Network)
Organization created by the tobacco industry to galvanize "grass roots" political action from among those who work in some capacity for the tobacco industry: growers, manufacturers, retailers of cigarettes, etc.
- Tobacco Institute (Industry Trade Association)
The purpose of the Institute was to defeat legislation unfavorable to the industry, put a positive spin on the tobacco industry, bolster the industry's credibility with legislators and the public, and help maintain the controversy over "the primary issue" (the health issue).
- UPI, United Press International
- Assembly Ways + Means Revenue + Tax
- Litigation
- Stmn/Produced
- Named Person
- Waters, E.
- Brown, Edmund G. - past Governor of California
- Brown, W.
- Caterinicchio, F.
- Cook, J.
- Deukmejian, G.
- Fergusson, T.
- Hayakawa, S.I.
- Kline, F.
- Manter, R.
- Melenkoff, A.
- Moore, G.
- Nelson, R.E.
- Padberg, E.E.
- Reagan, R.
- Roberti, D.
- Type
- REPT, OTHER REPORT
- BUDG, BUDGET/BUDGET REVIEW
- CHAR, CHART/GRAPH
- LETT, LETTER
- Subject
- taxation
- corporate intelligence
- Corporate strategy
- industry activity
- industry front group
- industry influence
Document Images
Page 1: hps40e00
Log in for more options!
c
.
Nelson-Padberg Consulting
PROPOSaL
GRASSROOTS LOBBYING IN CALIFORNIA
FOR
THE TOBACCO INSTITUTE
Page 2: hps40e00
Log in for more options!
NELSON-PADBERG CONSULTING
November 8, 1982
.
Mr. Jack Kelly
Senior Vice President
The Tobacco Institute
1875 I Street, N.W.
Washington, D.C.
Dear Jack:.
Pursuant to your request of November 8, 1982, we are pleased
to offer our services to The Tobacco Institute to help you
oppose unfair excise taxes in California.
You have asked us to evaluate the wisdom of proceeding with
an advertising and public relations effort aimed at
influencing the State Legislature regarding tobacco excise
taxes. You have also asked us to briefly discuss how we
would proceed with such a program; and to identify the costs
and timing of such a project.
In preparing this proposal, we have assumed that an excise
tax is a very'real threat in the early stages of the*next
legislative session. We also assume that such a tax would be
very detrimental to sales. As a result, we have taken a
very aggressive approach in the program we recommend.
If the costs associated with the proposed action plan exceed
your budget, we would be happy to modify the program within
your constraints. Obviously, any reduction in the program
will have a corresponding reduction in the quantity of
communication with legislators.
We were pleased to be a part of the successf ul No on
Proposition 10 campaign in California in 1980; and we would
sincerely welcome an opportunity to work with the tobacco
family once again.
Sincerely,
~
~
obert E. Nelson Eileen E. Padberg ~
rb
C'~
18071 Fftch Irvine, California 92714 (714) 957-1010
Page 3: hps40e00
Log in for more options!
C
Nelson-Padberg Consulting
CONTENTS
: Page
I. Background 1
II. Strategy 2
III. Action Plan 4
A. Mobilizing the TAN Network 4
B. Mobilizing Known Allies 5
C. Mobilizing Tobacco Consumers 6
D. Mobilizing Tax Opponents 8
E. Stimulating Friends in the News Media 9
IV. Project Management 10
V. Proposal 12
VI. Budget Estimate 13
VII. Schedule 14
Page 4: hps40e00
Log in for more options!
Nelson-Padberg Consulting ~ 4 ~ ~
I. BACKGROUND
On November 2, 1982, a new Governor was elected in
California. Republican George Deukmejian will assume the
reins of leadership at a time when California government
faces the greatest fiscal crisis in its history: a looming
$1 Billion deficit in the state budget.
To compound this~problem, local governments are in dire
financial straits. Since voter approval of the Proposition
13 tax limitation measure in 1978, cities and counties have
developed a dependency on state government to bail them out
of revenue shortfalls. Because of the enormous deficit
facing state government, the day of the bail out is over,
unless new revenue sources are created at the state level.
During his campaign for Governor, Mr. Deukmejian pledged he
would not raise taxes in California. He is certainly an
honorable man, and he would no doubt like to keep his word
during his first term...or at least during his first year.
But he is also a realist. As a State Legislator he was
author of the largest tax increase in the state's history,
to prevent insolvency following the fiscal ineptitude of
former Governor Edmund G. Brown, Sr. (It is interesting to
note that both Governor Browns left the state with enormous
pending deficits. In 1966, newly elected Governor Ronald
Reagan faced a $400 million deficit as the legacy of the
elder Brown.)
Thus, it cannot be assumed that Mr. Deukmejian will be able
to honor his word-and reject new taxes. And, even if he
were to veto a tax bill, the Legislature could probably
override the veto.
Governor-elect Deukmejian has said that he will resolve the
deficit by cutting back on existing pro.grams, rather than
enacting new taxes. But there is no way to cut $1 billion
in spending without gutting the state transportation
program, educational system, or welfare system; and there
are insufficient votes in the Legislature to accomplish
radical changes in any of these programs.
We assume there will be some cutbacks in state programs.
But we also assume that there will be some tax increases.
Undoubtedly, the greatest burden of new taxes will fall on
corporations, either through higher corporate income taxes,
excise taxes, separate property tax considerations, or some
combination of all three.
There is no doubt in our mind that a major effort will be
made in January, 1983 to increase excise taxes on tobacco
products as a means of offsetting part of the revenue
shortfall California faces in the immediate future.
Page 5: hps40e00
Log in for more options!
Nelson-Padberg Consulting mr-ft rA t4 tN
II. STRATEGY
(
:
Ultimately, the only way to prevent increased excise taxes
on tobacco products is through an effective lobbying program
early in 1983, aimed at keeping a tobacco tax bill from
reaching the floor of either house.
The Tobacco Institute has already retained one of the finest
lobbying organizations on the West Coast to represent them
on this issue; and it can be expected that they will do an
excellent job in advocating TI's position.
However, lobbying has it's limitations. It is, in effect, a
"sales" approach to advocacy. That is, each legislator must
be personally convinced, one at a time, that our position is
the correct one. And we must accomplish this in the midst
of similar efforts on behalf of all other taxable interests
in the state.
To give the Tobacco Institute an enhanced opportunity for
success in this endeavor, we propose to add a second
dimension to the effort to influence legislators: a
"marketing" approach to encourage large numbers of
individual Californians to contact their legislators to
oppose excise taxes.
Such a program would be multi-faceted. It would include an
effort to convince certain political activists and community
leaders to contact their legislators on our behalf. It
would include an appeal to TAN members to contact key
legislators, particularly members of the Assembly Ways and
Means, Revenue and Taxation, and Senate Finance Committee.
And it would include a relatively low key--though not
inexpensive--effort to convince known tobacco users in the
general public to write members of the legislature and ask
for a vote against new excise taxes.
Each of these aspects will be discussed in greater detail on
the following pages.
We have also evaluated the possibility of using traditional
advertising tools to help implement this project. Af ter
much consideration, we recommend against any kind of public
advertising program other than Point of Sale response cards.
Radio and television advertising would not be accepted by
many (or, perhaps, any) stations; and if they were, they
would generate Fairness Doctrine reply opportunities which C
would work against us. W
~
Even if such advertising were permitted, we believe such a`~
~
call for legislative contact would infuriate many O
legislators who might otherwise be persuadable on the issue.~
Page 6: hps40e00
Log in for more options!
(
(
C
Nelson-Padberg Consulting
It would certainly stimulate the entire GASP network into a
major effort to push for the very taxes we oppose. Based on
the zealousness of their past efforts, we certainly don't
want to fuel the flames of their zeal at this critical time.
For the same reasons, we reject the idea of using newspaper
or regional magazine advertising. Besides stimulating the
GASP-'ers, print advertising would also tend to stimulate
opponents in editorial positions.
We also encourage TI to consider working with advocates for
the beer, wine, and distilled spirits industries, to explore
the possibility of a unified strategy. It might also be
possible to share certain costs of this proposal--such as
letters to tax opponents--with these other industries.
-3-
Page 7: hps40e00
Log in for more options!
Nelson-Padberg Consulting ~ w'~ arm
III. ACTION PLAN
(
C
The basic Action Plan we propose contains five elements.
They are:
Mobilizing the TAN network
- Mobilizing known allies
Mobilizing tobacco consumers
Mobilizing tax opponents
Stimulating friends in the news media
A brief description of our approach to each elenent follows.
A. Mobilizing the TAN Network
As soon as a bill is identified which includes an increase
in tobacco taxes, a letter will be sent to all 6,000 TAN
members in California: The letter will explain how such a
tax would unf airly attack our industry and would have a
detrimental affect on sales. The letter would identify
members of key legislative committees, and would indicate
which legislator lives in an area closest to their own
mailing address. The TAN member would be asked to send a
short note or mailgram, or make a telephone call to the
designated member. The mail package would also include a
response card to TAN headquarters with pre-paid postage, by
which the TAN member would notify us that he or she had
contacted a legislator, the method of contact, and the
name/s of the legislators contacted.
About three days after letters are received by TAN members,
a telephone bank would be used to call about 2,000 TAN
members who are known to be active in the California TAN
network. This phone bank would remind the TAN members about
the importance of contacting legislators immediately; and
phoners would be prepared to give names and addresses of
legislators over the phone, in the event the TAN member had
already discarded the mailing. This effort can be
coordinated by existing TAN staff in California making use
of company sales personnel. Alternatively, Nelson-Padberg
can develop such a telephone bank operation as an additional
cost item to this proposal.
The names of all respondents will be captured and
immediately entered into a data processing system. Thus,
the bill gets out of one committee or house, we can
immediately contact known respondents and ask them to
contact a new set of legislators.
if
Additionally, at the discretion of TI's California
lobbyists, some TAN members may be asked to actually make a
visit to key legislators. This contact would probably only
be appropriate if the TAN member is personally known to the
legislator, is a major employer in the legislator's
district, or is a known political activist in the
legislator's same political party.
Page 8: hps40e00
Log in for more options!
Nelson-Padberg Consulting ~ ~ ~
B. MOBILIZING KNOWN ALLIES
c
Outside of the TAN organization there are a number of
individuals who are sympathetic to our cause. Among them
are the Libertarian Party, which is generally opposed to.all
taxes, but expecially to excise taxes; bar owners, who will
suffer revenue losses tied to decreased purchase of
cigarettes in vending machines; and may include friends in
ethnic communities, who will bear an unf air burden of
taxation with increased excisg taxes.
Assuming the cooperation of leadership in the Libertarian
Party, we can stimulate at least a modest letter writing
program among Libertarian activists throughout the state.
We recommend some financial assistance directly to the
Party, to help offset the cost of mailings to their members
requesting action on the legislation in question. It would
also be wise to employ a key Libertarian leader as a
consultant to this effort.
Generally speaking, Libertarian activists are considered to'
be out of the mainstream of political activity. Therefore,
we would encourage them to write as consumer/taxpayers, not
as political ideologues.
Tavern owners share in the revenues from vending machines in
their establishments. It seems likely that a substantial
increase in taxes on cigarettes will cause an even greater
increase in the price of product in machines. It can'be
expected, therefore, the vend~ng sales will decline. It is
possible to obtain lists of tavern owners through list
brokerages; and it is probable that tavern owner
associations in California would also cooperate in
contacting their members on this issue. Additionally,
California tobacco distributors could provide lists of their
on-sale accounts, or could distribute an information
package/request f or action during the routine servicing of
their accounts.
There are several Hispanic and black organizations in
California, most of which have reached an organizational
peak as a result of activities in the November election. We
propose to retain a consultant from each of these
communities charged with responsibility for obtaining
letters from black and Hispanic groups and individuals,
protesting the unfairness and regressive nature of excise
taxes. These letters might be especially helpful with
persons such as Assembly Speaker Willie Brown and Senate W
President Pro-tem David Roberti, who are both responsive to 0~
these constituencies. `1
O
~
?V
-5-
Page 9: hps40e00
Log in for more options!
Nelson-Padberg Consulting ~ ~ ~
C. MOBILIZING TOBACCO CONSUMERS
L
c
We are aware of two ways to reach persons who are known to
be tobacco consumers: mailing to persons who have returned
coupons for premiums, purchased cigaret logo products, etc.;
and direct contact with the consumer at the point of sale.
For purposes of this proposal, we assume that TI members
maintain computerized lists which contain about 300,000
names of direct mail or premium coupon respondents. We
propose to obtain these lists from each company in a machine
readable fosmat (magnetic tapes, as opposed to printouts).
While protecting the confidentiality and proprietary nature
of these lists, we would produce a list of about 250,000
unique California residents.
.This list would be matched against a zip code list or other
means of segregating legislative districts.
A mailing would then be sent to these persons, asking them
to write or call their legislator, whose name, address, and
telephone number would be computer imprinted on the mailer.
To encourage this effort, we would pre-print the
legislator's name and address on a post card, so the
consumer would only have to hand write a personal message
and attach the required postage. We would also enclose a
pre-paid card to TAN headquarters with the respondent's name
preprinted, so they can indicate they have responded to our
request. These names will then be entered into a data
processing system for later retrieval on this issue or
future issues of concern.
A Point of Sale (POS) program can also be implemented. Such
a program should not include public display of the issue
through counter tents and the like, as this will tend to
stimulate our opponents--and may anger legislators--as they
are shoppers, too. Therefore, we recommend that a POS
program be confined to that which can be enclosed in or
attached to cigarette cartons prior to distribution to
retail outlets.
If the mechanics of the manufacturing/packaging/distribution
system perm its, we recommend an enclosure to all cartons
which would explain the issue and invite the consumer to
send a prepaid reply card to TAN headquarters authorizing us
to send a mailgram to the legislator on their behalf
protesting the proposed excise tax.
C
It is very difficult to estimate how successful these two tj
programs would be. TI may be aware of similar programs on ~
tobacco issues in the past, and we would welcome your ~
experience in developing more exact estimates. For purposes ~
of this proposal, however, we have estimated that there are
about four million tobacco consumers in California. If .005 w
Page 10: hps40e00
Log in for more options!
Nelson-Padberg Consulting ~ U~
(one half of one percent) of them were to respond to the POS
message, it would produce 20,000 mailgrams; or an average of
250 messages to each of Cali_fornia's Members of the
Assembly.
In 1980 we sent a letter of behalf of the No on Proposition
10 cainpaign to about 175,000 premium respondents, requesting
a cash contribution to the campaign. This mailing produced
about 2,000 responses, equivalent to .011 of the universe
contacted.
If we assume a similar level of response to the mailing
described in this proposal, we could generate about 2,800
cards to 'the legislature. As these cards would be targeted
to a group of perhaps 40 key legislators, each would receive
an average of 70 cards. (There is also reason to believe
the response rate might be higher, as this mailing does not
ask for money, and would have a direct bearing on the price
of product to them.)
