In a country, far, far away, tobacco is just the beginning

På tisdag, den 31 maj, uppmärksammar WHO ”World no Tobacco day” och i år är temat ”Get ready for plain packaging”. Därför publicerar vi idag en text av Australiensiska Skattebetalarnas VD Tim Andrews. En text från en land långt, långt borta där plain packaging för tobaksprodukter redan är verklighet, och lagstiftarna sneglar girigt på alkoholen, skräpmaten och mycket annat de hoppas reglera näst. Ett land mycket lik vårt.

Private property is at the heart of the successful modern economy. The protection of property rights has enabled us to flourish and created unprecedented prosperity, while secure property rights have been identified as the key difference between successful and failing economies. So critical is the right to own and enjoy property that it is considered a fundamental right in the United Declaration of Human Rights.

This is not limited to physical property. Property of the mind – intellectual property – is equally vital, and has been responsible for innovation and today’s creative, vibrant knowledge-based economy. Thus protection of property, both physical and intellectual, is critical to economic development, and one of the most important guarantees of freedom we have.
Yet in 2012 the Australian government announced an unprecedented attack on intellectual property rights through mandating every detail of the “plain packaging” of tobacco products, and forbidding companies from displaying their trademarks or differentiating their products. Other countries are set to follow suit, and well funded multi-million dollar campaigns are underway to extend the stripping of private property rights from other industries, particularly alcohol and food products.

The extinguishing of private property rights, and the precedent it sets for other industries, is bad enough. However to make matters worse, the evaluation of the policy’s effects has been just as bad as the policy itself. No matter the Olympic-gymnast-worthy statistical contortions of the public health lobby, three years of data from the Australian experiment has demonstrated conclusively that plain packaging has completely failed to have any impact whatsoever on smoking rates in Australia or to have any positive impact on public health.

While the public health lobby will stop at nothing to portray this unprecedented departure from established principles of good public policy as a success that can be extended to other industries, the evidence has clearly shown that plain packaging has failed. As noted by Professor Sinclair Davidson of RMIT University: “Despite our econometric efforts, the [ABS Household Survey] data refused to yield any indication this policy has been successful; there is no empirical evidence to support the notion that the plain packaging policy has resulted in lower household expenditure on tobacco than there otherwise would have been. There is some faint evidence to suggest, ceteris paribus, household expenditure on tobacco increased.”

Indeed, the intellectual bankruptcy of the public health lobby is demonstrated through their entire defence of plain packaging. Initially it was claimed that tobacco clearances fell 3.4% in the year after implementation. Only after Freedom of Information applications was it revealed that this was caused by retailers purchasing new plain pack stock in 2012 and receiving refunds on surplus non-saleable stock in 2013. The claim of a 3.4% decline in clearances was a lie.

Similarly, the government’s implementation report was found to have “trend lines” inserted with little correlation to the underlying data, deliberately engineered to obfuscate the fact the data revealed the decline in smoking prevalence remained on trend. Accepting the underlying data provided by the government, it is clear that if anything, in four of the five Australian mainland states smoking prevalence increased in 2013 compared to 2012. Yet the report sought to mask this through graphical manipulation.

Other ethically dubious actions included the government giving more than $3million of taxpayer funds without tender to one of the chief architects of the plain packaging experiment, Melanie Wakefield, to assess the effectiveness of the laws. It is little surprise that the architect of these laws decided they were effective. More telling, however, is the fact that after intensive questioning by a Senate Committee, the Health Department has now retreated from claiming the Wakefield tracking survey has reduced smoking prevalence, and instead simply relies on it for the lame truism that surveys have found that people find less attractive packs packs less attractive.

This is not to say that plain packaging has had no impact. While it has not affected smoking prevalence or achieved any public health outcomes, plain packaging legislation has had two demonstrated effects on the Australian economy. Firstly, with products unable to compete on the basis of their trademarks, brand substitution has occurred as price became the only determinant of competition. KPMG has found that the use of low-cost tobacco has skyrocketed from a quarter of the market prior to the legislation to over 50%. Secondly, without the protections and security features that sophisticated packaging allows, black market tobacco smuggled by criminal syndicates has increased to almost 15% of the market, increasing 30% from 2013-14. Not only has this provided a lucrative and low-risk revenue stream for groups associated with terrorist activities, it has also led to a loss of billions of dollars in excise revenue for the government.

The statistical abuses and desperation of the public health lobby to prove plain packaging’s effectiveness is understandable in the context of their long term goals. Plain packaging of tobacco represents the first serious assault on intellectual property by governments in decades, and it is this precedent that they are determined to protect. If a government is allowed to effectively nationalise the intellectual property of one industry, there is nothing to prevent it doing the same for others. Plans for graphic health warning and plain packaging for alcohol and “junk food” are well under way, with the public health lobby freely admitting tobacco products were simply the thin end of the wedge. While other proposals to further restrict tobacco products include limiting the number of retailers in an area, allowing smoking only through prescription, smoker licenses, a price floor, recorded messages in cigarette packs and the “deliberate addition” of faeces -smelling material to cigarettes”, it is the ramifications of this regulatory cascade to other industries that is most troubling.

This is most evident in alcohol, where in Australia, New Zealand and the the United Kingdom it is openly argued that “food should be regulated like tobacco”. The McCabe Centre for Law and Cancer has been campaigning for years for plain packaging of alcohol, with public health lobbyists open about their desire to apply the tactics “used to demonise the tobacco industry” to alcohol. In the UK also, the head of Science and Ethics for the British Medical Association argued in support of plain packaging of alcohol that “we have to start demoralising alcohol”.

Even more troubling is the move beyond alcohol to food. Australian public health lobbyists have already argued for the banning of “imaginative marketing techniques” in supermarkets to “create a neutral environment for consumers”. The former head of the Australian Medical Association, Professor Kerryn Phelps, has argued that “ protecting children from junk food and obesity is a fundamental human rights issue”. The idea of stripping trademarks as a move to foster human rights is so brazen it is difficult to see how it could be taken seriously, yet apparently this is already the case.

Plain packaging has also been raised in the context of gambling and slot (poker) machines, as well as casino architecture, while South Africa already has plain packaging for baby formula. Graphic health warnings for food are also under discussion in Canada, California, New Zealand, and the” while Chile has mandated a “STOP’ sign on junk food. To make matters even more galling, almost all of these campaigns are funded by taxpayers, a shocking and blatant case of government lobbying itself through sock puppet organisations and astroturfing, at a cost of millions of dollars a year.

The continued popularity of plain packaging amongst the public health lobby, despite its failure to have any impact on smoking prevalence, demonstrates that this legislation is not about public health outcomes. It is about one thing only – control. At its core is the thoroughly debunked socialist ideology that distrusts intellectual property, marketing and consumers, and wishes to return to the failed system of top down central planning and government control of provision of goods and services. As is always the case with socialist and other utopian schemes, it begins with an attack on private property and, left unchecked, this erosion of intellectual property rights would spell disaster for any liberal economy.

Such proposals flounder, however, when faced with both the evidence of their failures, as well as against the principles of the importance of property rights. It is this defence of intellectual property that is so vital, and one that must always be remembered and stressed. As unpopular as it may be to publicly defend the intellectual property of tobacco companies, unless the assault on trademarks is checked now, it will be too late. On every objective measure, plain packaging has failed to achieve any of its aims. In stripping trademarks, it has achieved nothing other than setting a very damaging precedent. The same shall occur in Sweden as elsewhere.

It is time the international community wakes up and defends the fundamental human right of intellectual property, before we become a dystopia of plain packages as far as the eye can see.

Tim Andrews är VD för Australian Taxpayers Association.