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DRAFT ONLY DRAFT THE EPA AND THE SCIENCE OF ENVIRONMENTAL TOBACCO SMOKE by Dr. S. Fred Singer Professor of Environmental Sciences (on leave) University of Virginia and Senior Fellow Alexis de Tocqueville Institution and Mr. Kent Jeffreys Adjunct Scholar Alexis de Tocqueville Institution CONFIDENTIAL: TICT 0002555 TOBACCO LITIGATION

About this study... "The EPA and the Science of Environmental Tobacco Smoke" is the first in a series of evaluations of the science that forms the basis of the Federal government's environmental regulatory decisions. Given the growing costs of compliance for environmental regulation on individuals, businesses, and state and local governments, it is extremely important that the public be made aware of the precise degree of potential health and ecological risks based on sound scientific principles. This in turn would result in more rational -- and perhaps less costly -- environmental regulation. The final report entitled "Science and Environmentalism" -- scheduled to be completed in mid-June -- will evaluate the science behind several of the most current environmental questions. The goal of the report is to provide policy-makers, the media and the general public with information that will help improve and rationalize environmental policy decisions. The Center on Regulation and omic Growth, a research project of the non- profit, non-partisan Alexis de Toquevill tution, was established to conduct research on the costs and benefits of regulation, rther information, contact Cesar V. Conda, executive director of the Alexis de ~q~eville Institution: Phone No: (703) 351- 4969. Address: 2000 15th Street North, S. 5d~','>~ington, Va. 22201 Note: Nothing written here should be construed as necessarily reflecting the views of the Alexis de Tocqueville Institution or its co-chairmen and directors, or as an attempt to aid or hinder legislation before Congress. CONFIDENTIAL: TICT 0002556 TOBACCO LITIGATION

DRAFT ONLY The EPA and the Science of Environmental Tobacco Smoke Introduction I The downward trend of cigarette b~g in America has been going on for many years. Whereas almost half of all adults on'c~`e~*ed, now fewer than three out of every ten American adults smoke, and th s rate~'~s Atinuing to decline.' This downward trend is the result of a combination~of factors: greater knowledge of the health risks associated with smoking, increased federal and state taxes, and a general reduction of tolerance for smoking on the part of nonsmokers, among other things. Ironically, as smoking has declined, the federal government has increased its campaign against smoking. Undoubtedly, many view this effort as beneficial to society. However, it now appears that the federal government has gone beyond its traditional anti-smoking efforts, consisting mainly of education and health warnings, and is now moving toward a (de facto) ban on smoking. The vehicle by which this ban may take effect is an Environmental Protection Agency (EPA) study which allegedly found harmfull effects on non-smokers from environmental tobacco smoke, ETS, which is also called "second-hand smoke" and "passive smoking." If this were the case, it would be difficult to stop the government from banning smoking in the name of protecting innocent non-smokers. Unfortunately, in its zeal to abolish smoking, science has been sacrificed. The EPA's finding that second-hand smoke is harmful to human health is based on a lower threshold of risk assessment than what the agency normally uses for other substances. In short, the EPA study relied on methodologies different from those which have been historically used in such analyses. Scientific standards were seriously violated in order to produce a report to justify a political agenda, namely to ban smoking. Before the government takes action to ban some substance on the basis of its ' W. Kip Viscusi, Smoking: Making The Risky Decision, (New York: Oxford University Press, 1992), p.1. 1 TICT 0002557 CONFIDENTIAL: TOBACCO LITIGATION

danger to health, it is extremely important that we know the precise degree of danger based on generally accepted scientific principles. If science is debased in an effort to "do good," society ultimately may be left worse off. There are two reasons for this. First, if we debase the scientific method in pursuit of a political agenda, we are opening a Pandora's Box. Second, the number of dangers everyone encounters in everyday life are so numerous that if we do not carefully delineate the government's role in regulating such dangers there is essentially no limit to•how much government can ultimately control our lives. The health risk from smoking is -*Joe focus of this paper. Instead, this paper explores the EPA's analysis of ETS or~seco~id smoke. By any name, it is a complex and highly variable mixture of substances which ~fuse through the air. And ETS has elicited a complex and highly variable political reaction: The Environmental Protection Agency has compiled several studies and reports which examine various aspects of the ETS issue. Two in particular are considered at length in this paper; one examined the respiratory health effects of ETS2 and the other examined the economic consequences of a proposed restriction on smoking.3 In brief, EPA makes certain assumptions about ETS which are then used to buttress EPA's scientific and economic conclusions. Moreover, the science as presented is insufficient and the economic claims are similarly unsupportable. They will be dealt with in turn. First, we will examine EPA's use of the scientific research surrounding ETS. EPA and the Science of ETS There are certain things about smoking which sound science can demonstrate. 2 U.S. EPA, Office of Health and Environmental Assessment, Office of Research and Development "Respiratory Health Effects of Passive Smoking: Lung Cancer and Other Disorders" Washington, D.C., December 1992. Hereinafter cited as "U.S. EPA, Report." 3 U.S. EPA, Indoor Air Division 6607J, Office of Radiation and Indoor Air, "The Costs and Benefits of Smoking Restrictions: An Assessment of the Smoke-Free Environment Act of 1993 (H.R. 3434), Washington, D.C., April 1994. Hereinafter cited as "U.S. EPA, Costs and Benefits." 2 CONFIDENTIAL: TICT 0002558 TOBACCO LITIGATION

For example, active smoking may be detrimental to the health of millions of smokers. Nevertheless, EPA has no official role when it comes to regulating smoking. Yet, EPA lately has taken the leading role in publicizing the potential health risks from smoking. According to EPA Administrator Carol M. Browner, "Although EPA has no regulatory authority over tobacco products, it does have a responsibility to inform the public about dangers it finds in the environment."` In particular, EPA has gone far beyond its authority in making ETS an "environmental" issue within its regulatory jurisdiction. In the process, it has engaged in both scientific overreach and regulatory overreach. Admittedly, trying to prove that second-hand smoke carries a measurable risk of lung cancer and determining precisely wha that,risk is are difficult tasks. It is accepted that smoking is linked to several forms o r, particularly of the lungs, and also to heart disease. Similar conclusions about pa ' oking, or ETS, should be based upon equally strong scientific evidence. To that end, e~t'A has undertaken a review of the scientific literature to determine the effects of ETS on the lungs of nonsmokers. The EPA's major finding was that "ETS is a human lunggcarcinogen, responsible for approximately 3000 lung cancer deaths annually in U.S. nonsmokers."s The question addressed by this section is whether or not that statement is justified. Crossing the Threshold It is well-established that "the dose makes the poison." That is, almost any chemical substance will harm a person's health if administered in sufficiently large quantities. Even substances which are necessary for life itself become deadly at high doses. Unfortunately, the EPA ignores this fact in most of its risk assessments by applying a "linear no-threshold" theory of environmental harm. In essence, the linear no-threshold theory holds that high-dose effects can be extrapolated back to a zero dose 4 Carol M. Browner, Letter to the Editor, Washington Post (May 6, 1994). 5 U.S. EPA, Report, at page 1-1. CONFIDENTIAL: TOBACCO LITIGATION 3 TICT 0002559

without searching for a threshold below which no health effect will be elicited.b In other words, if it were found that exposure to a given level of some chemical substance caused one death per 100,000 population, then half the exposure would therefore cause one death per 200,000 population, one fourth the exposure would cause one death per 400,000 population, etc. This flawed assumption underpins almost all of the EPA's work on environmental exposures, from the Superfund program to radon in homes to, especially, ETS. I The EPA claims to discern an " arent non-threshold nature of the dose- response response relationship observed betwee e smo_king and lung cancer."' Even if this were true for active smoking (and, as quesho s that statement is, it is beyond the scope of this paper), it is not automatically valid o reject 'the possibility of a threshold effect for ETS. For environmental tobacco smoke is/not just a lower dose of the substances inhaled by a smoker, important, if poorly researched, chemical changes occur as tobacco smoke is diluted and cooled in the open air. Researchers recognize three principal types of tobacco smoke. "Mainstream smoke" is produced when the smoker draws air through a cigarette, thereby "fanning" the temperature as high as 900 degrees centigrade. Most of the compounds in smoke change as they cool and as they react with the smoker's mouth, throat and lungs. "Exhaled smoke" is not the same as the smoke that was inhaled. "Sidestream smoke" is that which is produced by the smoldering cigarette between puffs. Because the temperature is significantly lower (perhaps 500 to 600 degrees centigrade), different chemical compounds (or different amounts) are produced. Together, mainstream smoke, exhaled smoke and sidestream smoke produce environmental tobacco smoke, 8 See, for example, Elizabeth M. Whelan, Toxic Terror: The Truth Behind the Cancer Scares, Prometheus Books, Buffalo, NY, 1993. ' U.S. EPA, Report, at page 5-1. 4 TICT 0002560 CONFIDENTIAL: TOBACCO LITIGATION

with sidestream smoke accounting for 85 to 90 percent.8 The EPA notes that some potentially carcinogenic compounds are present at much higher levels in sidestream smoke than in mainstream smoke. This is a function of the respective temperatures at which various compounds form. Regardless of the composition of sidestream smoke when it is produced, it rapidly undergoes changes, both chemical and in terms of concentration per liter of air. EPA's report recites several distinctions between ETS and mainstream, or even sidestream smoke. The most important distinction arises from the significant dilution of the ETS. In addition, the composition and concentration of ETS is dependent on the number of smokers, their smoking styles, and the number of cigare smoked in a given period of time. According to the EPA, for active "A clear dose-response relationship exists between lung cancer and amount of exp~ without any evidence of a threshold level."9 Of course, a strong dose-response relatio;'hip does not rule out the existence of some minimum dose below which there will be zero response. Yet the EPA almost never looks for a threshold for any potentially harmful substance. In fact, it is essentially an unofficial EPA policy to deny that thresholds exist for any potentially hazardous substance. As examples, consider EPA's stance on dioxins, radon gas, or pesticide residues in the food supply.10 What is more, the fact that tens of millions of smokers survive their habit without developing lung cancer seems to suggest that a threshold exists for each individual, regardless of EPA's assumptions concerning aggregate data. Tbus, the statement that no evidence for a threshold exists could easily confuse members of the public. e Gary L. Huber, Robert E. Brockie, and Vijay K. Mahajan, "Smoke and Mirrors: The EPA's Flawed Study of Environmental Tobacco Smoke and Lung Cancer" Requlation (No. 3, 1993), p. 46. 9 U.S. EPA, Report, at page 4-1. 10 See, for example, Michael Gough, "Reevaluating the Risks From Dioxin," Journal of Regulation and Social Costs, January, 1991, pages 5-23; Bruce N. Ames and Lois S. Gold, "Chemical !'arri nn-r~r+cci c• Trn M~nar Dn~nnt (`arni nnncnc ~~ Drnn~a~in~'tc !~ t'}1? National Academy of Science, 87: 7772-76, 1990. 5 CONFIDENTIAL: -rICT 00025b1 TOBACCO LITIGATION

As mentioned earlier, essentially every substance to which humans are exposed is potentially harmful. Many ordinary substances -- common table salt, for instance -- are fatal if ingested in sufficiently large amounts. In addition, hundreds of foods in the human diet contain enormous quantities of "natural carcinogens."11 Because the human species has evolved the ability to self-repair the damage caused by these naturally occurring substances, we are also able to repair the similar damage caused by small amounts of other carcinogens, including the ones found in ETS. In the face of this assertion by EPA that no safe threshold exists for active smoking, it becomes important to examine how closely EPA links ETS with mainstream smoke. The EPA's Guidelines for Carcin emRisk Assessment (U.S. EPA, 1986) sets out "three criteria that must be met befo usal association can be inferred between exposure and cancer in humans: r 1. There is no identified bias that couldn explttin the association. 2. The possibility of confounding has been considered and ruled out as explaining the association. 3. The association is unlikely to be due to chance."`Z Under these criteria, one could conclude that mainstream smoke (MS) easily qualifies as a lung carcinogen. However, the EPA asserts that because sidestream smoke is chemically similar to MS and because sidestream smoke is the major constituent of ETS, then by inference ETS is also a Group A carcinogen under the EPA test However, EPA is well aware that ETS is not identical to mainstream smoke, either qualitatively (chemical makeup) or quantitatively (dose). Nevertheless, EPA seems to adopt the old cliche': "Close enough for government work." It should be borne in mind that even if ETS is legitimately considered a "known human carcinogen," that does not prove that, at actual environmental exposures, it can or does cause lung cancer. In fact, most U.S. studies conducted on ETS and lung cancer " Lois S. Gold, et al., "Rodent Carcinogens: Setting Priorities," 258 Science 261, October 9, 1992. 12 U.S. EPA, Report, at page 4-28. 6 CONFIDENTIAL: -rICT 0002562 TOBACCO LITIGATION

have found no statistically significant indications of carcinogenicity. Many observers have questioned whether EPA's conclusions are justified.13 If this were limited to the question of an internal EPA categorization, it would not be excessively controversial. However, much more is riding on this classification than mere bookkeeping entries. Declaring ETS to be a Group A carcinogen has set in motion a chain of policy events which must ultimately result in widespread federal bans on smoking. To quote the EPA's expressed reasoning in full: 'Me conclusive evidence of the dose-related lung carcinogenicity of MS [mainstream smoke] in active smokers, coupled with information on the chemical similarities of MS and ETS and evidence of ETS uptake in nonsmokers, is sufficient by itself to establish ETS as a known human lung carcinogen, or "Group A" carcinogen under U.S. EPA's carcinogen classification system."" ,~ . Similarly simplistic reasoning has' allowyd'ihe EPA to publicly fret over almost every suggested cancer risk, from electromagne~(4ation to artificial sweeteners.'s Despite the EPA's conclusion that ETS is a~A carcinogen, it is at the very least arguable that ETS would flunk each separate step of the three-prong test. And it is the EPA's effort to cross the final hurdle that has produced the harshest criticism. When its review discovered that existing U.S. studies of lung cancer and ETS did not support its position, the EPA arbitrarily reduced the traditional standard of proof, or "confidence interval." Only by this manipulation could the EPA claim that its analysis was statistically significant. Why is the concept of statistical significance so important to epidemiological studies? As valuable as these studies can be, there are well-recognized limitations. For instance, no matter how well designed, epidemiological studies can only show 13 See, for example, Michael Fumento, "Is EPA Blowing Its Own Smoke?" Investor's Business Daily, January 28, 1993, page A- 1. 14 U.S. EPA, Report, at page 1-2, 1-3. 15 For a general discussion, see Michael Fumento, Science Under Siege, (William Morrow and Company, Inc., New York: 1993) 7 CONFIDENTIAL: TICT 0002563 TOBACCO LITIGATION

correlation, not causation. Only after many studies have found strong correlations covering large populations (as is the case with active smoking and lung cancer) are researchers on firmer ground in asserting direct causation. (Yet even then they may not know the precise mechanism.) Most individual studies, which are expensive and time- consuming, involve only a small number of individuals (or sample size). This reduces the confidence that researchers place in how well the sample population reflects the characteristics of the general population. Epidemiologic studies can test the specific hypothesis, for example, whether ETS is a risk factor for lung cancer. While even well designed studies cannot prove beyond any doubt that a particular substance is the cause of cancer, they can indicate that a particular substance is a potential risk factor. In this case, the EPA assumed -- before it even began its investigation -- that ETS is a risk factor for lung cancer; the very question supposedly being asked. However, the fOlhat most studies of ETS and lung cancer do not support this assumption is not entirely /orid by~EPA. Why else did the EPA adopt unique manipulations of the data which~,so cle~arly designed to cover up this embarrassing fact? Furthermore, the EPA does not utilize the appropriate "two-tailed" analysis of whether ETS causes lung cancer. In a two-tailed test, a specific assumption is made, for example, that ETS has an effect on human health. (The two "tails" refer to the fact that the hypothesized effect may be harmful or beneficial: the evidence may point in either direction.) In addition, if ETS were found to have no measurable effect either way, that would be called the "null hypothesis." In its examination of ETS, however, the EPA utilizes a "one-tailed" test. That is, the EPA makes the assumption that ETS cannot stimulate the human immune response and thereby produce lower rates of lung cancer than would exist in the absence of exposure. However, several American studies examined by the EPA leave open this very point. Indeed, of the 30 studies considered for inclusion in the EPA report, "six found a statistically significant (but small) effect, 24 found no statistically significant effect, and 8 CONFIDENTIAL: TICT 0002564 TOBACCO LITIGATION