Driving a truck through free trade

This story caught my eye on Friday:

The former head of the World Trade Organisation has indicated Australia is well placed to win its fight for plain packaging against the objections of tobacco-producing countries, saying nations had a right to put public safety over trade.

Pascal Lamy, who left the WTO after seven years in the role last year, said Australia was embroiled in a “classical fight” between public health on the one hand and intellectual property on the other.

“The basic doctrine of the WTO is that you’re entitled to take measures that have trade consequences to protect the health of your citizens,” Mr Lamy told The ­Australian Financial Review.

I can imagine scenarios where public health concerns might trump free trade – although I’m not convinced overall. But this becomes a massive loophole where governments and their public health lobbies can manufacture any story from any orifice and constrain trade and/or appropriate private property.

Let’s accept for argument sake that public health issues should trump free trade – when should this occur? Who has the burden of proof? Surely it cannot be enough to simply allege a public health benefit; the benefit needs to be demonstrated. There is little evidence to demonstrate that plain packaging is having a health benefit. For example, here is Chris Snowden:

here’s what’s happening in New South Wales where a third of the entire Australian population lives…

The 2013 NSW Population Health Survey shows that 16.4% of all adults in NSW smoke. While this is higher than the 14.7% rate in 2011, the difference is not statistically significant and most likely reflects the change in survey methodology. In 2012, NSW Health implemented a new survey design that included mobile phones for the first time.

A smoking prevalence survey that can’t statistically distinguish between 14.7% and 16.4% isn’t much use, but the figures certainly doesn’t imply that plain packaging has been a roaring success, to put it mildly.

Then there is this rather amusing letter from Julie Soderlund to the Cancer Council Victoria.

Four years ago, in April 2011, Professor David Hill, Director of Cancer Council Victoria made bold predictions about the impact of plain packaging.  Writing in the Sydney Morning Herald, he claimed that “plain packaging will slash smoking rates … make significant inroads into reducing rates of smoking initiation and consumption … [and] has enormous potential to cut smoking rates.”[i]  In February 2013, barely two months after trademarks had been removed from the Australian tobacco market, you quoted Fiona Sharkie of Quit Victoria who claimed that “plain packaging is already having an effect.”[ii]

Yet, in your critique of a recent analysis of adolescent smoking prevalence conducted by researchers from the University of Saarland and the University of Zurich,[iii] you appear to have changed your view.  You now claim that plain packaging could not “be expected to immediately lead to a detectable reduction in adolescent smoking prevalence” and that this was not the “expectation of governments or any credible researcher.”[iv]  Similarly, in your critique of an analysis of adult smoking prevalence conducted by London Economics,[v] your position was, “it is likely to be many years before an impact on the decline in prevalence can be accurately assessed.”[vi]

We are confused.  Will plain packaging “slash smoking rates” or will it have no measurable effect for years to come?  Was there an effect already in February of 2013 but no effect a year later?

Do you indeed say now that one cannot expect plain packaging to have any impact on smoking rates one year after its full implementation?  If that is the case, after how many years should governments expect to see the measurable effect you promise, and with what magnitude and probability?  How many years is “many:” three, five, ten or more years?

We are also struck by your statement that no “credible researcher” would expect an impact within the first year (particularly as this is what Professor Hill enthusiastically proclaimed in 2011).  This is at odds with the findings of the expert elicitation exercise conducted by Pechey et al. in 2012, in which renowned tobacco control experts provided best guess estimates of the impact of plain packaging on adolescent smoking.[vii]  Ultimately, the experts guessed that the number of youth trying smoking would decrease by 3% within two years.

Our question to you:  If the “best guess estimate” is a reduction of 3% within two years, would you not expect some effect within the first 13 months of implementation?  Or, in the alternative, is it your view that neither these experts nor this study are credible?

Finally, is it not a double standard that you would be happy to portray studies that count whether people display their packs in cafes and bars as evidence that plain packaging is working,[viii] but dismiss out of hand a thorough statistical analysis of more than 41,000 data points on actual smoking behavior?

We look forward to your answers.  As the World Health Organization International Agency for Research on Cancer wrote,

As tobacco control policies are formulated and implemented, it is important that they undergo rigorous evaluation  … [W]e need to not only consider the size and nature of effects, we also need to consider the possibility that there is no meaningful effect. (…) We recognize that science cannot prove the null hypothesis, but it can and should make statements about interventions where there is a consistent failure to find evidence of any meaningful effect.[ix]

 

With our warmest regards,

Julie Soderlund, Vice President Communications, Philip Morris International

Bottom line is this: By all means claim that Australia is exempt from it free trade obligations under the WTO on public health grounds, but at the very least produce evidence that the public health grounds are valid. Otherwise it becomes open season on dismantling free trade.

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54 Responses to Driving a truck through free trade

  1. hammy

    public health issues should trump free trade

    Free trade is just a religious belief by the far right. It certainly can’t be allowed to adversely public health. To argue that it should is grossly irresponsible – which is a characteristic of the far right I guess.

  2. I tell ya what!?!? I smoke, and have done for years. Give me back all that friggin money I’ve handed over to Medicare, by force, and I’ll look after my damn self. Hell I might even be able fire up my own cancer research!?!?!? Get out of my life you authoritarian, parasites!

    At worse I’ll have bloody good funeral, and be able to provide for those surviving me! Gimme my money back and go the F away!

    Anyone got a light? ;-) I’ll meet ya behind the shelter sheds! :-)

  3. Infidel Tiger

    I’m sure the Liberals will fight the good fight and stand up for property rights and free markets.

  4. ABW

    Of course plain packaging will slash smoking rates. Pot comes in plain plastic bags and no one ever smokes that do they?

  5. Notafan

    Why is Australia still involved in this, what a waste of money, millions in taxpayers money during a budget crisis.

  6. Hammy, “Free Trade” is a natural right.
    A natural right to negotiate and exchange, either for currency or a negotiated medium, for the mutual benefit of the particpants.
    It’s called Natural Rights! It’s got nothing to do with ideology!, nothing to do with religion! It’s got everything to do with what you were born with and cannot be taken away.
    Just because some wanker says you can’t do it, doesn’t render it non existant. It stills exists. It’s just some tosser, with an over-abundance of power, usually supported by a monopoly or overwhelming force, has come along and corrupted it or banned it!
    Marx came along and called it capitalism, the moron! And all the other morons bought into his invention of labeling something that is completely normal and natural so he could keep leaching off Engels, who was his Moron in Moronics! Is that a collective of Morons? :-) Anyway… Anything other than people being free to negotiate and trade amongst themselves is a corruption of a completely natural process!

  7. Infidel Tiger has the joke of the day LMAO :-)

  8. Alfonso

    Free trade doesn’t exist….. but naive, fact blind, colonial bunny, laughed at by Europe, unilateral free traders like Australia are regarded as the one Alan Bond you get in a lifetime.

  9. ar

    Otherwise it becomes open season on dismantling free trade.

    Well, duh! Everything leftists do is to move us inexorably leftward…

  10. wreckage

    naive, fact blind, colonial bunny, laughed at by Europe

    Yeah, because we should be taking economic lessons from Portugal, Spain, Ireland, Italy, Greece, or even France.

    Thanks to being “colonial bunnies” our upper middle class and political class are a lot less inbred than theirs, to our great advantage.

  11. Rabz

    Wasn’t one of the original political pardees in Oz known as “the Free Trade Pardee“?

  12. Rabz

    My, how far we have fallen in this once mighty land.

  13. Sally Moore

    Yes, Infidel Tiger. Just like the Coalition has stood up for free trade and founding laws on hard facts and evidence of effectiveness, with regards to the Illegal Logging Law! Ha! Same old Nanny State, same old authoritarian “Big Brother knows best”, same old catering to special interests.

  14. .

    The former head of the World Trade Organisation has indicated Australia is well placed to win its fight for plain packaging against the objections of tobacco-producing countries, saying nations had a right to put public safety over trade.

    My personal sovereignty overrules what a monstrous fuckwit like Nikki Roxon thinks.

  15. .

    Hammy – the one area of agreement economists have is on free trade.

    There is no benefit in restricting trade. It can only impoverish you.

  16. Free trade is just a religious belief by the far right. It certainly can’t be allowed to adversely public health. To argue that it should is grossly irresponsible – which is a characteristic of the far right I guess.

    Now, now, Hammy. Smokers do a great service to society by enriching the tax coffers.

    Also, everyone in Stalinist Russia used to smoke, including Uncle Joe himself. So it must be a good thing.

  17. Gavin R Putland

    Well, if plain packaging made no difference to smoking rates, then the tobacco companies’ most sacred “intellectual property” was worth nothing and they shouldn’t get any compensation for its expropriation, if indeed it has been expropriated.

  18. Joe Goodacre

    I hope Australia does win.

    Right or wrong it’s an Australian law and therefore a question of sovereignty. Australia should determine what laws govern Australians.

  19. Rob MW

    I caught the interview with Pascal Lamy on the ABC the other night. He is nothing more than an outspoken enemy of free enterprise and an advocate of ‘Collectivism’ and one of the brain dead so called experts (Socialist’s) who believe that the European Union with its unelected and all powerful system of rule by Commissionars should be adopted as a World Government system. He portrayed the sovereignty of countries and their elected Governments that make up this world of ours as been nothing more than trade barriers to the ideals contained in the notion of collectivism as the ultimate trading initiative for the 21st century.

    He, in the first instance, appeared oblivious to the fact that the E.U of itself and in its creation is the biggest trade barrier ever to see the light of day. If he ever decided to look in the mirror he would see looking back at him a failed Trotskyist fool.

  20. Robert O.

    There is enough evidence around now to show that smoking kills you, albeit slowly. If people are stupid enough to start smoking, then let them suffer the consequences without Nanny state intervention. I remember some publicity years ago; a surgeon had two sets of lungs on meat trays, one was grey and the other rosy in colour. He was asked how many lung operations had he performed on non smokers, the answer was none out of 200 or so operations. If that doesn’t convince anybody that smoking is bad nothing will.

  21. JC

    There is enough evidence around now to show that smoking kills you, albeit slowly.

    That’s a very silly statement. What sort of smoking….? 2 packs a day, 1 pack per day, 1 cig per day…. you need to specific eggsactly what that statement means. I cig a day, 1 a week won’t kill anyone.

  22. Senile Old Guy

    Right or wrong it’s an Australian law and therefore a question of sovereignty. Australia should determine what laws govern Australians.

    Right. So “Australia” decides to have a law that all Red-Heads should have one leg amputated on birth. But, hey, it’s an Australian law so “right or wrong” it is a “question of sovereignty”.

  23. Senile Old Guy

    Well, if plain packaging made no difference to smoking rates, then the tobacco companies’ most sacred “intellectual property” was worth nothing and they shouldn’t get any compensation for its expropriation, if indeed it has been expropriated.

    Bzzzzzzzzzzt! Wrong. It’s all about market share and brad recognition. And the fact that, since plain packeting and tax increases, sales of black market tobacco have greatly increased.

  24. nerblnob

    Wotsername’s letter does illustrate one paradox of the health activist mendicants:

    one the one hand – they have to insist that whatever interventionists tax/prohibition they advocated is working just great, commissioning many studies to say just that.

    while on the other hand – they have to insist that The Problem is scarier and worse than ever ( commissioning many studies to say just that) so they can continue to press for more taxpayer funding.

    Curiously, I noted on my recent trip to Australia that small tobacconist shops appear to be flourishing once again. Perhaps the statisticians will tell me that I was seeing things.

  25. Yohan

    It would be great to push back against the PC left and get rid of the smoke packaging ulcer pictures altogether.

    I would even re-allow cigarette advertising, like the old Camel and Marlboro adverts in girly magazines from the 80′s.

  26. Sinclair,

    You’ll be pleased to learn that the WTO legal system agrees with you that there must be a sound basis to the public policy and it must be administered in a non-discriminatory way to justify an exemption from WTO rules. There have been few cases where WTO has denied an exemption on the basis of a policy that was not sound but they indicate that a measure that justifies an exemption must be actually directed at the public health problem and applied to domestic as well as imported products.

    They do not suggest that the policy must be known in advance to be effective. I’m not uncomfortable with that since most regulation is basically an experiment. But the claime that the laws do seem to be, in fact, effective does not mean that the policy was an unsound basis for a WTO exception. Well, that’s my view… (we’ll see what the WTO Appellate Body says).

    But saying the plain packaging measure is an attack on “free trade” is off the mark. It exaggerates the potential harm of this measure by making it look like a general policy failure/reversal. But it’s not. It is not essentially a trade measure at all (although it works only when it affects imports as well as domestic product).

    What has happened in Plain Packaging is not a reversal of a “free trade” policy (accepting for the sake of the argument that we have such a policy) but the withdrawal of a license. The license (to exploit a trade mark) was freely given by government because in most cases there is a public benefit in granting such licenses. In this case (the Plain Packaging measure indicates) there is no longer a public benefit in granting that license and the govenment has withdrawn it. The opponenents of the measure say that the withdrawal should be compensated (as if it had been a ‘property’) and that the withdrawal infringes freedoms of expression (I’m more sympathetic to that argument…). But none of them can say that this is about free trade since the product continues to flow into Australia on the same terms as before. Imports conform now to the trademark laws in place now as they did before the Plain Packaging law.

    Best wishes,

    Peter

  27. nerblnob

    Without my reading glasses on, or from a distance, they just looked like pretty colours.

    “Plain” packaging, it ain’t.

  28. nerblnob

    Peter, I would have thought that a government deliberately interfering with trademark licences is a distortion of free trade. You may think that’s a good thing, and it may be a good thing, but it’s the opposite of free trade.

  29. Joe Goodacre

    Right. So “Australia” decides to have a law that all Red-Heads should have one leg amputated on birth. But, hey, it’s an Australian law so “right or wrong” it is a “question of sovereignty”.

    So the WTO decides that all Red-Heads should have one leg amputated on birth. But hey, it’s a WTO order so ‘right or wrong’ it is a question of sovereignty.

    Pointless answer because it cuts both ways, the only difference being that the WTO is further removed from Australian citizens than the Austalian government.

  30. Aristogeiton

    Senile Old Guy
    #1329142, posted on June 2, 2014 at 5:53 am
    Right or wrong it’s an Australian law and therefore a question of sovereignty. Australia should determine what laws govern Australians.

    Right. So “Australia” decides to have a law that all Red-Heads should have one leg amputated on birth. But, hey, it’s an Australian law so “right or wrong” it is a “question of sovereignty”.

    Of course such a law has been seriously proposed from time to time, so this is a very real threat. Better to have some all-powerful judge or UN bureaucrat decide which laws of ours are valid and to what extent. “We the people” cannot be trusted.

  31. Rabz

    most regulation is basically an experiment

    This experiment in plain packaging has failed.

    Time it was ended, before taxpayers get screwed, yet again.

  32. Demosthenes

    Peter, I would have thought that a government deliberately interfering with trademark licences is a distortion of free trade.

    Licences are the distortions of free trade, as Peter points out.

  33. Mr McGoo

    Ban absolutely the sale or supply of tobacco products to any person born on or after 1 January 2000, and put the burden of proof on the seller or supplier. Within a year or two the rate of growth of new smokers will be zero.

  34. Aristogeiton

    Mr McGoo
    #1329218, posted on June 2, 2014 at 8:37 am
    Ban absolutely the sale or supply of tobacco products to any person born on or after 1 January 2000, and put the burden of proof on the seller or supplier. Within a year or two the rate of growth of new smokers will be zero.

    Lol; because they will have no way of getting smokes otherwise, particularly when others can purchase them or the market for chop-chop explodes. No cigars for millennials either because fuck them.

  35. Aristogeiton

    Demosthenes
    #1329207, posted on June 2, 2014 at 8:27 am
    Peter, I would have thought that a government deliberately interfering with trademark licences is a distortion of free trade.

    Licences are the distortions of free trade, as Peter points out.

    Enough with your ivory tower libertarianism. The LDP will make themselves irrelevant if they don’t come out in support of crony capitalism.

  36. Mr McGoo

    “because they will have no way of getting smokes otherwise, particularly when others can purchase them”

    It is a bit subtle, but “supply” would include others purchasing and providing to anyone currently under 14 years of age.

  37. .

    Joe Goodacre
    #1328841, posted on June 1, 2014 at 10:58 pm
    I hope Australia does win.

    Right or wrong it’s an Australian law and therefore a question of sovereignty. Australia should determine what laws govern Australians.

    No.

    My sovereignty is all that matters, other than god’s if he/she exists.

    Australian sovereignty that doesn’t treat me as a sovereign citizen for which it is merely acting as an agent for can go to hell.

  38. Aristogeiton

    Mr McGoo
    #1329231, posted on June 2, 2014 at 8:53 am
    “because they will have no way of getting smokes otherwise, particularly when others can purchase them”

    It is a bit subtle, but “supply” would include others purchasing and providing to anyone currently under 14 years of age.

    Easy to enforce. Illicit drugs are illegal to supply and possess, and nobody uses them, right?

  39. Aristogeiton

    .
    #1329234, posted on June 2, 2014 at 8:54 am
    Joe Goodacre
    #1328841, posted on June 1, 2014 at 10:58 pm
    I hope Australia does win.

    Right or wrong it’s an Australian law and therefore a question of sovereignty. Australia should determine what laws govern Australians.

    No.

    My sovereignty is all that matters, other than god’s if he/she exists.

    Australian sovereignty that doesn’t treat me as a sovereign citizen for which it is merely acting as an agent for can go to hell.

    The LDP will make themselves irrelevant if they don’t abandon the notion that individual citizens are rational actors with their own moral agency. Typical ivory tower libertarianism!

  40. Joe Goodacre


    My sovereignty is all that matters, other than god’s if he/she exists.

    Australian sovereignty that doesn’t treat me as a sovereign citizen for which it is merely acting as an agent for can go to hell.

    This is a leftist answer – the ends justify the means.

    Except that what invariably happens is that the WTO comes out with some requirement you won’t like and then you’ll be complaining about your individual sovereignty being violated again, except this time it will be by bureaucrats that you don’t vote for.

    We won’t get to pick the bits we like – the whole package and consequences of laws being made elsewhere get’s rammed down our throat. The Brits have recently shown with the success of UKip how much fun that is.

  41. Aristogeiton

    Joe Goodacre
    #1329250, posted on June 2, 2014 at 9:08 am

    My sovereignty is all that matters, other than god’s if he/she exists.

    Australian sovereignty that doesn’t treat me as a sovereign citizen for which it is merely acting as an agent for can go to hell.

    This is a leftist answer – the ends justify the means.

    Joe Goodacre accusing others of leftism. Now I’ve heard it all!

  42. Token

    …but at the very least produce evidence that the public health grounds are valid. Otherwise it becomes open season on dismantling free trade.

    Why are you not assuming that the left identify a desired outcome – dismantling free trade – and then found a convenient excuse to enable that outcome to be achieved?

  43. Gavin R Putland

    Senile Old Guy wrote:

    Bzzzzzzzzzzt! Wrong. It’s all about market share and brad recognition.

    Where have I heard that before? Oh, yeah, decades ago, during the debate over tobacco advertising. The tobacco companies claimed that they advertised solely in order to take business from each other. And in their efforts to keep taking business from each other, they united with one voice.

    And the fact that, since plain packeting and tax increases, sales of black market tobacco have greatly increased.

    Concerning excise taxes on undesirable products, I concede that you can only tighten the screw so far before you strip the thread.

  44. Aristogeiton

    Commence wowserism; I’ll get the popcorn.

  45. Wolf

    How long until plain packaging on fast food is “in the interest of public health”. And then plain packaging on all food to curb irresponsible nutritional advertising. We know where it goes from there.

  46. The LDP will make themselves irrelevant if they don’t abandon the notion that individual citizens are rational actors with their own moral agency. Typical ivory tower libertarianism!

    Bonehead, if individuals are irrational, how can groups made up of individuals possibly be rational?! Logic fail, my boy!

  47. Damn! Just saw that I accidentally dropped a “not” from my comment above. It SHOULD read

    “But the claim that the laws do not seem to be in fact effective, does not mean that the policy was an unsound basis for a WTO exemption.”

    An ugly sentence in any case. I agree that it looks like plain packaging doesn’t work and (because it is only an experiment) should be revised/reversed. But I don’t think its vulnerable in WTO because of that.

  48. .

    Beery – I believe Aristo was taking the piss.

    Joe Goodacre – you are the living end. Calling me a leftist because I believe in individual sovereignty?

    You are off your tree, pal.

  49. The Internet can be a poor medium for sarcasm. I also agree, dot, that Joe is off his tree. Unless of course he was being sarcastic.

  50. Tiddly Pom

    At least in the terms posited by the initial post (“driving a truck through free trade”), Peter Gallagher makes by far the most sense in this thread.

    Plain packaging is imposed on imports and domestic supplies alike. As it is non-discriminatory, it does not fall foul of WTO disciplines. Lamy, however odious he is (and I agree he is), is on this occasion far more correct than Sinclair Davidson. The issue is trademarks and brands, not free trade. If the tobacco companies have persuaded a small government or two to lob in a complaint to the WTO, this is merely in the interests of interests of periodic publicity for the cause during the several years it takes for any complaint, however half-baked, to wend its way through the WTO complaints process, not the expectation of success.

    Don’t get me wrong – there are plenty of valid reasons to oppose the plain packaging legislation, as others have pointed out. Free trade is not, however, amongst them.

    And I don’t think that attacking plain packaging on the basis of such a fundamentally flawed premise does anything to advance the cause of getting it removed on the basis of its real flaws. Quite the opposite.

  51. Richard Bender

    Peter Gallagher, sorry, your argument is based on a false premise. Withdrawal of an exclusive licence to use a trademark would mean that British American could market Winfield as Malboro and Phillip Morris could sell Malboro as Winfield, as neither company could claim an exclusive legal right to use a particular branding. What the government has done here is dictate to both British American and Phillip Morris how they must brand their products.

    On the original topic, how is this even a public health issue? Public health issues have to have some element of involuntary risk, e.g. contagious disease. With smoking, the risk is completely voluntary.

  52. johanna

    PG, you seem to be saying that a brand name is property of the government, to be allowed or withdrawn at a whim.

    Get thee to a nunnery.

  53. nerblnob

    Peter Gallagher, sorry, your argument is based on a false premise. Withdrawal of an exclusive licence to use a trademark would mean that British American could market Winfield as Malboro and Phillip Morris could sell Malboro as Winfield, as neither company could claim an exclusive legal right to use a particular branding. What the government has done here is dictate to both British American and Phillip Morris how they must brand their products.

    That was my point in my first reply to Peter. Trademark protection is part of the legislative framework that allows free trade to flourish.

    Public health issues have to have some element of involuntary risk, e.g. contagious disease. With smoking, the risk is completely voluntary.

    Correct, but universal public funding of health care allows the taxgatherers to claim ownership of many things under the “public health” umbrella.

  54. Aristogeiton

    The Beer Whisperer
    #1329424, posted on June 2, 2014 at 11:44 am
    The LDP will make themselves irrelevant if they don’t abandon the notion that individual citizens are rational actors with their own moral agency. Typical ivory tower libertarianism!

    Bonehead, if individuals are irrational, how can groups made up of individuals possibly be rational?! Logic fail, my boy!

    Sarcasm in response to Joe Goodacre’s bloviation. I really should attend to Poe’s law; particularly here where people seriously argue that ‘there is no such thing as a moderate Muslim’ and ‘the majority of immigrants are practically retarded’.

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