Smoking monkeys

Interesting Forbes article on what would happen if the US tobacco firms lost the government’s $280 billion lawsuit. Short answer: the government would end up as Altria (once Philip Morris), Reynolds American and BAT USA’s controlling shareholder.

It might sound odd that, like much of Evil Socialist Europe [*] until recently, ‘free market’ America would end up with a state tobacco monopoly. Well, until you remember that the business-minded libertarianism of the people who refused to pay tax on tea has always jostled with the puritanism of the country’s original settlers (remember, these were the people who left Britain because it was illegal to be a religious fanatic here).

"It’s the fresh new morality crusade that also reduces the unpleasant taste of deficit…"

One thing I don’t understand. At the moment, Altria stands to lose not only its Philip Morris USA business, but also its international cig brands, Kraft Foods and its 20% stake in brewer SABMiller. But (like Reynolds, which sold its food business to, err, Kraft, and its foreign cigs business to Japan Tobacco), it has a duty to its shareholders to minimise non-tobacco assets ahead of any trial.

I can see a fire-sale could be a problem – perhaps it should instead split its stock into PM USA shares, PM International shares, Kraft shares, and SABMiller shares, so that the greedy Feds can’t steal all the shareholders’ money? Obviously you’d neeed to list PMI and Kraft abroad to stop retroactive asset-theft, but this shouldn’t be a major problem.

(via Vice Squad)

[*] Copyright Arnold Schwartzenegger, who knows what it’s like to live under communistical Social Democratic government.

This entry was posted in Uncategorized by John B. Bookmark the permalink.