Gov. Jim Doyle was the man in white, the crusader against cancer, as he delivered his State of the State speech in January. “I helped lead the national effort to take on Big Tobacco,” he bragged. “I’ve devoted much of my public career to this fight.”
Perhaps, but the governor wasn’t very anti-vice in his first term. He had repeatedly killed any effort to raise the tax on cigarettes. Now he was suddenly an anti-tobacco zealot, proposing a huge $1.25 hike in the cigarette tax, moving Wisconsin from 30th-lowest state for this tax to fourth-highest. Adding insult to injury, he proposed a statewide ban on smoking in public places.
It was a remarkable turnabout, and Doyle told the press that everywhere he goes in the state, people applauded his approach. After all, the vast majority of voters are nonsmokers who find secondhand smoke irritating. And all these fine citizens won’t have to pay the cigarette tax, so why should they care if it’s raised? This is as close as a governor gets to free money.
A higher cigarette tax will reduce consumption of an infamous product, one that kills people and increases medical costs for the entire state. Meanwhile, the tax will raise scads of money, at least $400 million annually, which can be used to fund a sweeping new program of health care coverage that Doyle favors.
“I have never witnessed such spending greed in my 16 years in the state Assembly,” fumed state Rep. Steve Nass (R-Whitewater). Many frustrated Republicans assailed the increased tax, knowing full well most voters were unlikely to be bothered by it.
Indeed, the entire anti-smoking package is so practical and attractive, has so many benefits and makes Doyle look so heroic, you wonder why it wasn’t proposed years ago. Were Doyle and other politicians unaware of the terrible toll taken by tobacco, and the huge benefits to be gained from taxing it? Hardly.
No, the story of how Joe Camel suddenly got targeted by state leaders is an insider tale of backroom deal-making and campaign contributions, of politics and more politics. Just a year ago, pro-smoking forces seemed well-placed and plenty powerful in Madison, but the November elections helped create a vastly different political climate. Big Tobacco is suddenly facing a Big Freeze.
Vice had always been good for former acting governor Marty Schreiber. Written off as a political has-been after his defeat in the 1978 race for governor and the 1988 race for Milwaukee mayor, Schreiber had trouble finding his footing.
“I decided to open up a law office and become everyone’s favorite family lawyer,” he reflects. “The law practice wasn’t going so well. Miller Brewing Company was looking for a lobbyist. At that point, I decided to represent these companies.”
Schreiber became a key operative for tobacco, beer and gambling interests, emerging as one of the state’s top-paid lobbyists. He was the classic insider, one who served on the transition team of former Republican governor Scott McCallum, but he’s also an old friend of fellow Democrat Jim Doyle. Schreiber has told the media he talks with Gov. Doyle frequently about a range of issues and provides advice on campaign fundraising.
Martin Schreiber & Associates, the lobbying company he owns, earned $1.1 million in the 2005-2006 period, ranking sixth in the state among all such firms. His company placed fifth in the prior biennium, 2003-2004, earning $1.3 million in fees.
Schreiber says it’s all about providing information: “It is important that decision-makers have an understanding of the ramifica-tions of their decisions.” State Rep. Jon Richards (D-Milwaukee) agrees, declaring that “Martin Schreiber is respected because his lobbying is credible and factual.”
So Schreiber has become wealthy by doing good research? Capital insiders scoff at this, saying lobbyists like him thrive by fun-neling campaign donations from interests they represent to politicians. “Marty Schreiber is a poster boy for that kind of activity,” says Mike McCabe, director of the Wisconsin Democracy Campaign. “It has nothing to do with Schreiber’s persuasiveness on an issue. It has to do with the money his clients bring to the table.”
The money flows from cigarette manufacturers like Philip Morris as well as a company like Miller Brewing, the Milwaukee beer maker that is still connected to Philip Morris (it owned 28 percent of Miller’s stock as of February). It flows from the Wisconsin Tavern League, which fears a smoking ban will cause a loss of customers. It flows from the Wisconsin Restaurants Association, which until recently opposed a smoking ban. It flows from operators of gas stations and convenience stores, which sell lots of ciga-rettes.
And it flows to both political parties. The Wisconsin Democracy Campaign looked at campaign contributions from groups af-fected by tobacco legislation and found former governor Tommy Thompson gained more than $180,000 from these interests during the four years leading up to his last re-election in 1998.
The WDC did the same analysis of Doyle’s first term and found he garnered more than $213,000 from these groups. This, how-ever, did not include the crucial, final reporting period for the 2006 election, covering late August through early November, so the grand total is likely to be a good deal higher.
Doyle also got charitable donations from some of these groups to help pay for his 2002 inauguration ceremony. Among those paying $25,000 each were Philip Morris, Miller Brewing and Forest County Potawatomi, all represented by Schreiber & Associates.
Thompson was a great friend of tobacco, judging from a national survey of the media conducted by Philip Morris in 1998. The company found Thompson was the third-most favorable news source on tobacco-related issues, surpassed only by Philip Morris and the Tobacco Institute. Thompson, in fact, rated more favorably than the director of the Tobacco Institute.
Doyle wasn’t that good a friend, but he ran for governor in 2002 as an avowed opponent of an increased cigarette tax. As governor, he threatened to veto any such tax increase in May 2003 and again in April 2005. Wisconsin’s current 77-cent tax on cigarettes is far below the top state, New Jersey, which has a tax of $2.58, and even further below Chicago, where the combined state and local tax on cigarettes is $3.66.
“The tobacco industry in Wisconsin has played a dominant role in shaping public policy … through the use of its economic and political power and strategic alliances with influential industries,” concluded a 2002 study by the University of Wisconsin Compre-hensive Cancer Center.
Maureen Busalacchi, director of SmokeFree Wisconsin, has been frustrated by the power of the opposition.
“The tobacco industry is very smart,” she says. “They hire all kinds of people.” And their work is usually invisible. “They lobby very stealthily. It’s hard to see who’s doing what for whom.”
Joey Handrick, who served six terms as a Republican state representative, lobbied for SmokeFree Wisconsin for a year, but felt outnumbered. “The tobacco lobby has so many lobbyists that you’ll see these people, and you have no idea which client they’re rep-resenting.”
In fact, there are also many anti-tobacco lobbyists. Groups like SmokeFree Wisconsin, the American Cancer Society and Wisconsin Medical Society spent more than $800,000 on lobbying the legislature in the last biennium, nearly as much as pro-tobacco forces like Philip Morris spent. The difference is that groups like the Cancer Society are nonprofits that can’t make campaign donations to candidates. And those dona-tions are the key to the persuasion process, as McCabe notes.
Another help for the tobacco lobby was the Republicans’ four-year effort to paint Gov. Doyle as someone who wanted to raise taxes. Doyle was wary of any tax hike, even on the minority of voters who smoked.
“There was a very anti-tax atmosphere, an anti-tax fever,” Busalacchi recalls. “We were running against a brick wall.”
For years, companies like Miller Brewing and Philip Morris have also paid special attention to African-Americans, both because they provided a solid base of customers, and because they could be counted on to oppose anti-tobacco legislation.
For more than a decade, state Sen. Gary George, an African-American Democrat from Milwaukee, worked to kill any anti-tobacco measure. George, in turn, was the recipient of generous campaign donations from companies like Miller and Philip Morris. These companies also spent charitable dollars strategically on African-American causes.
“It wasn’t just the black politicians; it was also the community-based organizations, the churches. They threw a lot of money at a lot of the organizations,” says Patricia McManus, Executive Director of The Black Health Coalition of Wisconsin. “The NAACP took big bucks from them.”
It was a partnership made in hell, given that blacks suffer disproportionately from the negative impact of tobacco. “The five lead-ing causes of death among African-Americans are all tied to tobacco,” McManus notes. Wisconsin has the sixth-highest rate of smoking for African-Americans in the nation. Tobacco’s impact on the community, McManus says, is “devastating.”
Led by McManus, local African-American leaders began to shift on the smoking issue. Soon, they were joined by others.
• • •
A crowd of more than a hundred gathered at Miss Katie’s Diner on a Sunday in March 2006. You might call this Milwaukee’s pro-smoking lobby, led by many tavern owners. They had waited for the rally to begin for more than an hour, some since 10:30 a.m., so they lined the bar, two and three deep, nursing bottles of beer and breakfast Bloody Marys, their cigarette smoke choking the air.
“If the city of Milwaukee falls, the whole state is going to go tumbling down the road,” Barb Mercer, president of the Madison Tavern League, warned the crowd, referring to Milwaukee Ald. Joe Davis’ proposal to ban smoking in all public places.
“None of us are going to dispute the fact that secondhand smoke is a health issue,” Mercer continued. “We’re here to talk about you, as a business owner, that you bought your bar or restaurant or bowling alley, and how dare they come in and tell you what to do.”
The crowd’s champion was Ald. Bob Donovan, a smoker, who portrayed himself as the defender of freedom and protector of small-business owners. Donovan also was chair of the Common Council’s Public Safety Commission, through which Davis’ smoke-free ordinance had to run the gauntlet.
Surveys had shown substantial local support for such a ban. As Donovan’s committee met to consider the issue on March 2, 2006, a crowd of tavern owners, women wearing anti-smoking blue T-shirts, children who drew colorful posters about the evils of tobacco, asthmatics, cancer survivors, and pack-a-day smokers filled the City Hall hearing room. They overflowed into two other rooms where television sets broadcast the hearing.
Tavern owners conjured a vision of businesses destroyed by the loss of smoking customers, of workers thrown onto the streets without a job. Parents told of rushing asthmatic children from smoke-filled restaurants into the open air to let them breathe. But more important than the arguments was Donovan’s command of the committee. He limited Davis to just five minutes, the same as other speakers, even though Davis was the ordinance’s author and wanted to explain its basic provisions.
Davis ultimately tried modifications of the proposal to assure passage, but fought a losing battle. In the battle between smoke-free and free-to-smoke forces, you might say beer won.
Why did passage fail in Milwaukee when a city like Lexington, Ky., in the heart of tobacco country, has a smoking ban? Perhaps because Milwaukee has at least three times more taverns than the entire state of Kentucky.
“You can tax milk before you can tax beer in Wisconsin,” observes one politician. In fact, Wisconsin’s beer tax, at 6.5 cents a gallon, is third-lowest in the nation.
In cities that have imposed smoking bans, like Appleton, Madison and Wauwatosa, bars have gone out of business, tavern own-ers note. But anti-tobacco advocates cite figures showing the number of establishments with liquor licenses went up in both Madi-son and Appleton after the ban. These two scenarios are not in contradiction. Nonsmokers may be more likely to patronize smoke-free restaurants. But on the fringes of the city, bars lost business to taverns in an adjoining municipality where smoking is still allowed.
Sharon Ward is a vice president of the Tavern League and owner of Wardski’s, a tavern at 15th and Rodgers on Milwaukee’s South Side. She says 85 percent of her patrons are smokers and will stop coming if a smoking ban is instituted. Many of these bars attract an older crowd. Young adults are more likely to find romance via the Internet or at a hipper Downtown bar.
“Most of these bars were family-owned, generation after generation,” Ward says. “Grandpa had it and passed it down to the son who passed it on down.” But many are closing. The tavern business is tough, Ward adds.
Sallie Ferguson is the African-American tavern owner of Fhaze II on North 27th Street. Her business is already down because street violence has scared some people from going out at night. If customers have to walk outside to smoke, she will have traffic in and out of her bar that’s harder to control. “If we have a smoking ban, I don’t know what the future is going to bring.” She might be forced out of business, Ferguson adds.
Ward sees the fight over smoking as a class struggle between working-class bar patrons and upper-income, North Shore types. “They don’t go out to bars. They go to eat. They have their glass of wine. And they go home.”
Restaurants were once allies of bars. The Wisconsin Restaurant Association co-sponsored the rally at Miss Katie’s, but its execu-tive director, Ed Lump, was already fatalistic about the future of this issue in Wisconsin. “Ultimately we are going to be smoke-free,” he predicted.
One year later, responding to Doyle’s call for a statewide ban, the association announced a flip-flop: by a 36-to-1 vote, its board decided to support the ban. “We’re disappointed,” says Peter Madland, director of the Tavern League of Wisconsin.
The Restaurant Association noted that some 30 municipalities in Wisconsin (the biggest being Madison) now had smoking bans, creating a situation where one restaurant can lose business to a neighboring establishment in a smoking-friendly municipality.
“There are only two paths to a level playing field,” Lump declares. “One is no regulation and the other is a complete ban. Any-thing in between creates winners and losers, with government regulations determining which businesses survive.”
But uniformity will help restaurants more than bars. A year after Minneapolis instituted a smoking ban, surveys showed most res-taurants were doing better but some taverns were doing worse. The trend is similar in smoke-free communities across the country. “Maybe it’s true what those skinny women who live on Marlboros have always maintained – if you quit smoking, you’ll start eat-ing,” mused the St. Paul Pioneer Press.
Black leaders are another convert to the smoke-free cause. Many supported Davis’ attempt to impose a ban in Milwaukee. Tradi-tional anti-tobacco organizations were so shocked they didn’t know how to react. “[They] blew up at first because they were so used to taking the lead. They actually got mad at us,” says McManus. “Now we are all friends.”
The issue cuts a couple ways for African-Americans, McManus says. Black nonprofits could lose contributions from tobacco companies, and black-owned taverns could be hurt. But African-Americans suffer disproportionately from cigarette use and “tend to work in jobs that allow smoking,” she says, where nonsmokers get exposed to secondhand smoke.
As more people line up in favor of Doyle’s proposals, the friends of smoking are increasingly outraged. “They feel like someone somehow has decided that it’s OK to step all over smokers,” Donovan complains. “If smoking is and has been such a big public issue in Wisconsin, then what has taken the governor so long to bring this proposal forward, and why didn’t he raise it prior to the election in November?”
• • •
This has not been a good time for Marty Schreiber. Known as a nonsmoker who always worked out and stayed in shape, Schreiber, who turns 68 this month, was diagnosed with cancer last year. He had to undergo chemotherapy and lost his hair last fall. Now he faces a nightmare package of anti-smoking proposals, a mighty test of his clout with Jim Doyle.
Schreiber, capital observers say, had already irritated the governor during the previous legislative session. The Potawatomi Indian Tribe, one of Schreiber’s key clients, wanted legislators to override the governor’s veto of a bill giving the legislature some control over the establishment of Indian gaming compacts. The Potawatomi, well-entrenched with their own casino, hoped legislative oversight would make it harder for other tribes to get similar compacts. Of particular concern was a possible Menomonee Indian casino in Kenosha, which could draw those Chicago-area gamblers who now travel to the
Milwaukee casino.
Schreiber worked to find enough Democratic votes to override a veto. Milwaukee legislators were the main target because they would support the Potawatomi cause over that of a Kenosha casino. Schreiber got his start as a legislator from Milwaukee, but still felt he needed to hire two former Milwaukee police union officials, Bill Ward and Bradley DeBraska, to lobby white Milwaukee lawmakers. Former alderman and acting Milwaukee mayor, Marvin Pratt, was given the assignment of winning over local black lawmakers.
The effort was a complete bust. Schreiber could not secure a single Milwaukee Democratic vote. One political insider called this “probably the greatest defeat in the last couple of sessions.”
Some Democrats believe Schreiber has lost effectiveness with Democratic lawmakers because he lobbied with such ferocity, straining his longtime friendship with Gov. Doyle. “He has burned a lot of that relationship,” says a Democrat who is well-connected with the Doyle administration.
But Rep. Richards calls such talk nonsense. Everyone understood Schreiber had a role to play for his client, Richards says, and Schreiber had an uphill battle in this veto override.
But will Schreiber or any of the pro-tobacco forces be able to forge a compromise that might lower the proposed hike in the cigarette tax or make the smoking ban less sweeping?
“The governor lives in the real world and understands sometimes compromises have to be made,” says Matt Canter, Doyle’s spokesperson. But Canter doesn’t seem to expect a major compromise. “If the governor can get 95 percent of what he wants, he’s not going to walk away,” Canter adds.
State Sen. Scott Fitzgerald (R-Juneau) predicts Doyle will encounter opposition from legislators in his own party because the tax hike is so steep. He believes the proposed $1.25 increase will get whittled down significantly.
“We are taxing our citizens to death, and this is not the solution,” Fitzgerald contends.
But the very intensity of some Republicans’ outrage broadcasts their frustration over a proposal that seems so attractive to so many people.
State Sen. Glenn Grothman (R-West Bend) fiercely opposes the anti-smoking package but is realistic about its broad appeal. “It’s a political winner for Doyle,” Grothman concedes.
Some observers believe Doyle sees this term as his chance to secure his legacy, to take bold actions for which history will remem-ber him. And what’s better than a proposal only a small minority of voters is likely to oppose? The governor’s comments to the me-dia made clear his confidence that prevailing political winds were behind him, that the tobacco lobby was an evil empire the people would gladly watch him smite.
“We’re taking it all on,” he declared. “We know which direction history is going on this issue.”
Terrence Falk and Matthew Hrodey are frequent contributors to Milwaukee Magazine.
