India’s Real and Deadly Tobacco Problem A Retreat for Hollande And a Loss for France
Leaf-wrapped and string-tied bidis— not cigarettes—are the way locals light up Labor unions have again flexed their muscles— and the government has once more caved
Starting in April, the government of India will require that cigarette packs be largely covered in graphic warning labels. That’s smart; in other countries, such warnings have effectively pushed smokers to quit. The trouble is that cigarettes aren’t India’s biggest tobacco problem.
Most Indians who smoke light up a much cheaper, unfiltered product called a bidi: shredded tobacco wrapped in a tendu, or ebony, leaf and tied with a string. Popular among the poor—a pack can cost as little as 10¢—bidis in 2009 accounted for 85 percent of smoked tobacco in India. They have lower tobacco content than cigarettes, but more nicotine, tar, and carbon monoxide. Stick for stick, they’re deadlier.
Yet successive governments have shied away from discouraging bidi smoking. The new law requires warning labels on only one side of bidi packs. And bidis are barely taxed. As of 2013, the excise burden on bidis barely topped 5 percent; the World Health Organization recommends 70 percent. (National excise taxes on cigarettes, at less than 40 percent of the retail price, could stand to be somewhat higher, too.) Handmade bidis are taxed even less than machine-made ones, and those made by the smallest producers are exempt altogether. This encourages a sprawling rural industry in which women roll bidis at home for little pay.
Defenders say higher taxes would make bidis unaffordable to the poorest Indians. But that’s precisely how a tax would benefit public health. India has the world’s second-largest population of smokers after China—more than 100 million people —and more than a million tobacco-related deaths each year. In 2011 the Ministry of Health and Family Welfare estimated that the economic cost attributable to tobacco use had reached $22.4 billion, more than the central and local governments spent on health care that year.
Yet in India, unlike in the U. S. and Europe, the number of smokers continues to grow. And fewer than 5 percent French President François Hollande recently came up with some good proposals for reforming the country’s notoriously rigid labor laws. Most of them never made it into the bill presented to his cabinet on March 24. It’s a lost opportunity his country will have cause to regret.
The original plan, strongly supported by Finance Minister Emmanuel Macron, wouldn’t have scrapped the totemic 35-hour workweek law entirely, but it would have made life much easier for France’s beleaguered employers—loosening the rules on working hours, restricting union powers, and making it easier for companies to dismiss workers they don’t need. Lightening these burdens would have boosted employment and lifted the economy.
The retreat was unnecessary. French voters aren’t implacably opposed to economic reform. Macron is the government’s most popular politician by far. And ever since Nicolas Sarkozy was elected president in 2007 with a mandate to reform, it’s been clear that there’s a constituency for change. Yet protests by unions and students were enough to make the government back down.
Sooner or later, these reforms will have to be taken up again. Unions represent only about 8 percent of French employees, but their statutory role as co-managers of France’s health and social security system, and as representatives of French employees (whether they’re union members or not), gives them grossly disproportionate power. Layoffs, office moves, and petty management decisions are subject to their review. The rules bind companies with 50 or more workers: No wonder so many stop hiring at 49.
Hollande’s earlier proposal was moderate, even to a fault. In diluting it almost to nothing, he’s denied France its best chance to create jobs and boost growth. <BW>