A July 14 article on the tobacco grower buyout plan in Congress incorrectly reported that a bloc of 40 House members from tobacco-growing states would oppose corporate tax legislation if it provides for Food and Drug Administration regulation of tobacco. The members would oppose the legislation only if it omitted the buyout. Some of those lawmakers have indicated willingness to accept FDA regulation. (Published 7/15/04)

The House yesterday dealt a sharp blow to a proposed $9.6 billion buyout of tobacco growers, voting to prohibit the use of any government funds for the plan.

House Republican leaders, who support the use of taxpayer money to finance the buyout, conceded they did not have sufficient support to prevail over a coalition of Democrats, fiscal conservatives and tobacco control advocates in both parties. Rather than insist on a roll call of members, they allowed the amendment containing the buyout provision to pass on a voice vote.

The House later voted 389 to 31 to approve the underlying legislation, a $16.8 billion bill funding the operations of the Department of Agriculture, Forest Service, Food and Drug Administration and other agencies in 2005.

The House action throws into doubt the future of buyout legislation that GOP leaders pushed through the House earlier this year as a rider on a major corporate tax bill. Republicans used procedural devices then to prevent a separate vote on the provision, a top political priority in tobacco-growing states.

It would phase out the government-run quota system dating to the 1930s, and pay for the crop quotas buyout over five years, financed by $9.6 billion in tax revenue. But a Senate version of the corporate tax bill does not include the House rider.

Yesterday's House action denying taxpayer funding for the buyout plan appeared to strengthen the hand of moderates in Congress who favor a compromise. One proposal would involve industry financing of a phaseout of the old quota system, and would allow the FDA to regulate tobacco.

A number of senators in both parties favor such a compromise, as do tobacco-control advocates and some segments of the tobacco industry. However, a bloc of 40 tobacco-state House members has indicated it will oppose a final House-Senate version of the corporate tax legislation if the bill provides for FDA regulation of tobacco.

Spirited attacks on the original House-passed provision came thick and fast from both sides of the aisle yesterday.

"Some call it a buyout; I call it a sellout of the American taxpayers," said Rep. Chris Van Hollen (D-Md.).

Rep. Jeff Flake (R-Ariz.), a fiscal conservative who co-sponsored the amendment, said it was wrong to give the tobacco industry a nearly $10 billion payment in the midst of a war.

The buyout of tobacco growers and holders of government quota rights to market tobacco would provide at least $1 million to 463 companies, individuals or estates, according to a recent report by the Washington-based Environmental Working Group. Meanwhile, 354,000 of the 437,000 eligible for transition assistance would get $1,000 or less, the report said.

Although the impact of a phasing-out of the quota system is uncertain, some have suggested that it could end controls on production, increase output and lower prices -- a boon to tobacco companies and smokers.

But a parade of tobacco-state lawmakers, mainly from Kentucky, Virginia, Tennessee and North Carolina, took to the House floor yesterday to plead for relief for tobacco farmers.

In several major political races, such as the Senate campaign in North Carolina, the tobacco issue is emerging as a major point of disagreement between Republicans and Democrats. After initially indicating that he did not believe a buyout was necessary, President Bush backs the plan pushed by the House GOP leadership.

The underlying agricultural spending bill provides money for new agricultural research, food safety, food aid and other programs in 2005. Yesterday the White House budget office issued a statement saying the administration is "strongly opposed" to a provision allowing individuals to import pharmaceutical products from abroad because there is no assurance that the drugs meet FDA approval.

The pharmaceutical industry, a major contributor to the Republican Party, has made preventing legal drug importation a top priority, arguing that it would undercut profits needed to support research on new medicines. But the provision reflects strong support for drug importation from rank-and-file House members.