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Tobacco Companies, 36 States Draw Close to a $200 Billion Deal

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RALEIGH — Renewed hopes for a national tobacco settlement are burning brightly. Eight Attorneys General, including North Carolina's Mike Easley, are reportedly close to a $200 billion deal with cigarette makers.

The settlement would bring billions of dollars to North Carolina to treat sick smokers. But the industry would pay for the $200 billion dollar settlement by raising cigarette prices 35 cents per pack.

The deal also bans certain types of advertising. Easley says it may be next week before everyone signs off on all the documents, which solidify the complex deal.

"You see everything's written in the reverse, and I don't know why they do that," said Easley. "I'll show you some language in here that'll run you absolutely crazy."

Farmers are concerned that if the deal does go through, the price increase will lower demand for cigarettes.

"This is something that we didn't ask for and that we should be compensated for our losses and what may occur to us in the future," said Keith Parrish of the National Tobacco Growers Association.

Some smokers said another 35 cents a pack just might convince them to kick the habit.

"For one thing, the economic reason. The other would be I'm trying to quit anyway, so it would be that push over the line," said one smoker.

"It's over the edge for me, because it's not worth it," another smoker added.

That is why tobacco farmers want a piece of any settlement.

"The farmers have to be addressed in this issue, and we have our own problems already with our program and cuts that we've had. This just multiplies that," said Parrish.

There are a number of other forces that could lower demand for cigarettes and hurt tobacco growers.

In California, for example, a measure just passed will raise the tax on cigarettes another 50 cents per pack on top of the 35 cents extra from this tobacco deal.


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