Experts say that calculation wipes out most of the economic benefits from the regulations and could make them far more vulnerable to legal challenges from the tobacco industry. And it could have a perverse effect, experts said. The more successful regulators are at reducing smoking, the more it hurts them in the final economic accounting.
This threatens the FDAs ability to take strong actions against tobacco, Frank J Chaloupka, an economist at the University of Illinois at Chicago, said of the Food and Drug Administration. If they cant demonstrate that there is a significant economic benefit to doing it, then it makes their job much harder.
On Wednesday, Professor Chaloupka and other prominent economists, including a Nobel Prize winner, publicly took issue with the analysis. In a paper submitted to the FDA as the period for public comment on the regulations neared its end on Friday, the group said the happiness quotient was way too high and should be changed before the regulations take effect.
Theres reason to believe that number is much too big, said Jonathan Gruber, an economist at the Massachusetts Institute of Technology who was an author of the paper. In his view, the agencys analysis cited his past work erroneously.
The idea of lost happiness is new for health regulation. But it has surfaced as part of a longstanding requirement first codified under President Bill Clinton that every set of federal regulations with more than a $100 million effect on the economy needs an analysis to prevent the adoption of regulations with high costs and low benefits.
The cost-benefit analysis is embedded in a proposal from April that would extend the FDAs authority, for the first time, to electronic cigarettes and other tobacco products such as cigars and pipe tobacco, with potentially large consequences for the multibillion-dollar tobacco industry.
The FDA released a statement on Wednesday detailing the economics behind its analysis, but the explanation did not address the central assertion made by the economists. An FDA spokeswoman, Jennifer Haliski, said that there was still a great deal of uncertainty surrounding the calculation.
If the formula for assessing costs and benefits remains unchanged in the final version of the regulations, it could set a dangerous precedent that would constrain public-policy making for years to come, experts and advocates warned.
This approach to cost-benefit analysis could also have broader implications for regulations of the food and beverage industries, which could likewise point to lost pleasure from consumption of sugar, salt or other substances regulators seek to limit.
The economists assessment of the agencys approach is part of a flood of public comments more than 69,000 as of Wednesday submitted to the FDA on the tobacco regulations. The rules are supposed to become final by next summer, and experts anticipate that legal challenges will soon follow.
Economists speaking out on Wednesday said a basic assumption consistent with traditional economic theory lay at the heart of the federal governments miscalculation on the costs and benefits of the regulations: that most people were rational, well-informed market participants making decisions they would not later regret.
But smokers, they said, were different. A vast majority began smoking before age 18, when judgment is impaired. And many want to quit, but are addicted, and forgo the long-term satisfaction of better health for short-term pleasure.
It would be ridiculous to suggest that a 16-year-old who has no idea what addiction means and feels immortal is a rational decision-maker when it comes to smoking, said Kenneth E Warner, one of the papers authors and a professor of public health at the University of Michigan.
Pleasure was not the only problem with the FDAs economic analysis, the economists said. For example, it did not count the benefits to non-smokers of less secondhand smoke, or of reductions in infant mortality were fewer pregnant women to smoke, they said.
The only previous application of the happiness loss by the FDA to the proposal of graphic warning labels on cigarette packaging went largely unnoticed, but the current one is drawing attention because of how much the lost happiness counts.
- SABRINA TAVERNISE