Case study/Cigarette Regulation: Who Is Responsible

do a powerpoint based on the infromation posted 10-15 slides Case Study Cigarette Regulation: Who Is Responsible for What? By Ruth T. Norman Ruth T. Norman is an assistant professor and director of the Doctor of Business Administration program at Wilmington University in Delaware. Her research interests include business policy, business ethics, and media coverage of science and business issues. Contact: [email protected] Corporations have responsibilities to customers, employees, COmmUnities, and other stakeholders. Stakeholders also have obligations as well as rights. What is the appropriate balance between the rights and duties of the various parties? As a society, how do we decide where to draw the line? Do our ideas change over time, and, if so, what are the processes by which they change? This case study examines a complicated arena of corporate social responsibilitycigarettes. It looks at a number of ethical or normative issues, including uncertainty of risk, manipulation of science, free speech, free markets, adult free choice, marketing practices, protection of children and vulnerable populations, and responsibility for physical and financial harm. In doing so, the case examines actions taken by the cigarette companies, smokers, antismoking activists, regulatory bodies, and the courts in the United States over the past 60 years. Marketing Unhealthy Products Although smoking has declined in the United States, millions of current and former smokers still continue to be at risk for smoking-related disease, and a number of parties still reap significant financial benefits from the industry, including state and federal governments (settlement payments and excise taxes), members of Congress (campaign contributions), retailers, and employees. Taking a global perspective, despite an antismoking treaty brokered by the World Health Organization, cigarette smoking is increasing in developing countries. J The World Health Organization reports that 5 million people die annually from tobacco consumption and that 80 percent of the world's 1 billion smokers live in low- and middle-income countries.2 Activists are using the cigarette case as a template for other corporate social responsibility campaigns. Similar rhetoric, norms, and tactics are used in other areas, such as the antiobesity campaign. To what extent is Coca Cola or McDonald's responsible for making people fat? Or, are parents responsible for ensuring that their children have good eating habits? Legal precedents established in cigarette litigation set the stage for future litigation relating to other products, just as asbestos precedents (and tort revenues) set the stage for cigarette suits. This is the dynamic ethical and legal arena in which all organizations operate today. Marketing and other activities that may have been tolerated in the past are increasingly under scrutiny, and legal damages can run into many billions of dollars. History of Tobacco and Cigarettes in the United States The history of tobacco in the United States goes back to colonial days when it was a key export commodity. In that era, health concerns relating to smoking were minor compared to disease, accidents, and other causes of deaths. However, some people did voice ethical concerns about the slave labor that was integral to the cultivation of tobacco and other plantation crops. Whereas tobacco has been consumed for centuries in pipes, cigars, and snuff, smoking cigarettes is a relatively recent phenomenon, emerging commercially around 1870. The U.S. government helped establish the habit by supplying cigarettes to World War I and World War II soldiers. By the early 1960s, 42 percent of adults smoked cigarettes-52 percent of men and 34 percent of women.3 People had long suspected some negative health impacts from smoking (hence the slang term "coffin nails" for cigarettes), but it was also believed that there were physiological benefits such as relaxation, alertness, virility, and protection against colds. Such positive health claims were often incorporated in cigarette advertising. It was difficult to establish a statistically significant relationship between smoking and disease, in part because the effect is delayed, with cancer and other diseases often occurring more than 20 years after smoking begins. Some members of the medical community thought that industrial pollution was responsible for the rising prevalence of lung cancer, and no proven physiological mechanism could explain how smoking might cause cancer. However, by the mid-twentieth century, several factors combined to increase the suspected, though not yet proven, significance of smoking as a public health problem. First, since antibiotics and improved hygiene reduced premature mortality caused by infectious diseases, other causes of premature death were becoming relatively more important. Second, due to the rise in cigarette smoking following World War I, large numbers of people had been smoking long enough to experience the consequences. During the early 1950s, more sophisticated medical research techniques started to be used, and evidence that smoking caused disease was building. Cancer scare articles were carried by popular publications. In response, cigarette companies, which had previously operated in a highly competitive fashion, banded together to conduct a public relations counterattack. The industry maintained that scientific findings on the health hazards of smoking were inconclusive and pledged to do research to ensure that its products were safe.4 The industry responded to customer health concerns by offering new products with filters, menthol additives, and reduced tar and nicotine. These new products became very popular, and cigarette consumption resumed its growth pattern. Both the Federal Trade Commission (FTC) and the public believed that lower tar and nicotine cigarettes were safer than traditional products. However, independent studies subsequently showed that smokers compensate for reduced nicotine content and filters by inhaling more deeply, blocking ventilation holes, or smoking more cigarettes, hence largely neutralizing any risk reduction. Based on this new information, cigarette companies ceased promoting reduced nicotine and tar products as being safer, but they continued to use the terms "light" and "mild" in reference to flavor. Smoking May Be Harmful to Your Health u.s. As epidemiological evidence was becoming more convincing, the surgeon general commissioned a review by 10 medical experts. Their report, issued in January 1964, identified a strong association between cigarette smoking and substantially higher death rates in men. They concluded that the data supported a judgment of causality and called for remedial action. The tobacco industry countered that the scientific evidence was indeterminate. In support of this position, the industry's research arm sponsored its own carefully designed studies. The industry's sponsorship was not always revealed when these studies were published. As negative medical evidence started to mount, the percentage of the public viewing tobacco as a relatively harmless pleasure declined. However, there was not a groundswell of support for regulation because adult smoking was perceived to be a matter of personal choice. As a result of the power of Southern representatives in Congress, who were highly influenced by tobacco lobbyists and their campaign contributions, policy development proceeded with difficulty. The FTC proposed warning statements on packages and advertisements. Congress responded by ruling that the FTC did not have jurisdiction. Although the industry lobbied for self-regulation, Congress remained under pressure to formally take remedial measures. The resultant legislation was a highly compromised measure. The bill did mandate warning labels on the side of cigarette packs and cartons but did not require warning statements in advertisements. Furthermore, the mandated package warning, "Caution: Cigarette Smoking May Be Hazardous to Your Health," implied that there was some doubt. Congress declared that its bill preempted the FTC (for five years) and the states (for an indeterminate period) from requiring additional or more stringent tobacco warnings. Although the FTC was temporarily preempted from action, other federal agencies were not prevented from stepping into the fray. In 1967, the Federal Communications Commission applied the fairness doctrine of public broadcasting, previously employed to ensure that both sides of controversial political issues were presented, to provide free airtime for antismoking announcements. Smoking declined during this counteradvertising period, so the industry may have actually benefited when Congress banned television and radio advertising in 1971, thus ending free antismoking announcements. Congress strengthened the wording and prominence of the package warning statement in 1969 and again in 1984. In 1971, after the congressional preemption expired, the FTC mandated warning statements in cigarette print advertisements. Marketing Regulation Regulatory interference in marketing practices and product design tends to meet public resistance in the United States. Government, however, is perceived as having an obligation to protect children and other vulnerable populations. This obligation outweighs the free market and free speech rights of businesses. Many smokers start when they are teens; hence, government may have a legitimate role in regulating access and marketing practices. Similar to other manufacturers of consumer products, cigarette companies have spent large amounts of money on marketing. Sophisticated advertising campaigns created glamorous images for smoking and smokers. Establishing numerous retail outlets, including ubiquitous vending machines, and promoting multipack cartons helped ensure that smokers would always have convenient access to cigarettes. King-size cigarettes were promoted to increase the amount of tobacco consumed per cigarette. Antismoking proponents maintained that children were exposed to and strongly influenced by cigarette advertising even if it was targeted at adults. They claimed that children were vulnerable to the glamorous images portrayed and were too young to make informed choices about health risk. Products such as Virginia Slims were developed to appeal to females. Target marketing programs are common in many consumer products. In the case of cigarettes, however, marketing to specific segments, such as women or blacks, started to be viewed as manipulative and unacceptable. Regulation of youth access to cigarettes occurred at the state and local levels, where grassroots political activity was more effective and the industry's lobbying power was reduced. As a result of advocacy by various groups, all states have passed laws restricting minors' access to cigarettes. In 1971, Congress banned cigarette advertising on television and radio. Despite this ban, the industry was able to market effectively through other avenues. It continued to walk a thin line, however, on whether its promotional activities were targeted solely to adults. In 1987, R.]. Reynolds stepped over the line when it started a $75 million marketing campaign featuring Joe Camel, a hip cartoon character. The campaign included branded items such as T-shirts and beach sandals. The campaign garnered considerable criticism because of its apparent orientation toward children. California filed a lawsuit against the Joe Camel campaign citing unfair competition, and the company was forced to discontinue the Joe Camel promotions there. Product Regulation Although consumer protection laws from the 1960s and 1970s specifically excluded tobacco from Food and Drug Administration (FDA) regulation, a number of antismoking advocates continued to believe that cigarettes should be regulated by the agency. In February 1994, FDA Commissioner David Kessler resurfaced the issue by announcing his intention to regulate the nicotine in cigarettes. The agency moved forward with an exhaustive investigation of industry conduct. Its efforts were assisted by whistle-blowers and legal discovery. Four thousand pages of incriminating, internal Brown & Williamson (B & W) documents were stolen by a contract paralegal SlgJ sur Ari and made public. The investigations documented that B & W was purposely using Y-l, a nicotine-rich, hybrid tobacco, in some of its brands. It was also revealed that ammonia was commonly added to cigarettes to enhance the release of nicotine. Integrating addiction with the ever-popular theme of protecting children, FDA Commissioner Kessler labeled smoking as a "pediatric disease." In response, the industry filed a lawsuit against the FDA. The action eventually worked its way up to the U.S. Supreme Court, where, in March 2000, it ruled by a 5-4 margin that the FDA did not have jurisdiction over tobacco unless congressional legislation was enacted to grant the power. Such legislation did pass in the House in 2004 but failed in the Senate. In 2009, however, a bill authorizing FDA to regulate (but not to ban) cigarettes was finally passed. The reasons the bill passed this time include the declining power and image of the tobacco industry and support by Philip Morris USA, the largest U.S. cigarette company. The bill specifies a number of marketing restrictions but does not provide any protection against litigation even if a company is in compliance with all FDA content and labeling requirements. The new advertising and promotion restrictions will make it more difficult for the smaller cigarette companies to increase market share. Hence, it is not surprising that plaintiffs including Reynolds American and Lorillard filed a suit in federal court to block some of the marketing restrictions because they abridge their First Amendment rights to free speech. In addition to helping Philip Morris lock in its dominant market share, the restrictions make it difficult to provide information about smokeless products, which might be safer alternatives for current adult smokers of cigarettes. A federal district court judge ruled that the FDA cannot block the use of color and graphics in cigarette advertisements but upheld the constitutionality of other parts of the bill including requirement of warnings graphically showing health risks covering the top half of packages and bans on sponsorships and branded merchandise. Nonsmoker Rights A key element to the success of the antismoking campaign has been the advancement of a new concept, "nonsmoker rights." In this view, smokers are at fault because they put innocent people at risk. This campaign benefitted from previous public consciousness-raising by environmentalists, who had successfully framed pollution as a public policy issue in the 1960s and established the concept of a right to clean air and water.s Although environmental tobacco smoke health risks are lower than those encountered by smokers themselves, the concept of protecting innocent and vulnerable people from unpleasant and unhealthy tobacco smoke has had strong resonance with nonsmokers.6 The industry has attempted to undercut the scientific basis of this campaign by claiming that the evidence of health risks from secondhand smoke is inconclusive. It has argued against policy initiatives by maintaining that this is a social rather than a regulatory issue, and that the desires of both parties can be amicably addressed through courtesy and tolerance. Although the cigarette industry's financial and lobbying power continued to be significant at the congressional level, nonsmoker rights policies advanced slowly but surely at the state and local levels and through federal agency action. For example, Arizona, Connecticut, and Minnesota passed laws in the 1970s restricting smoking in public places. Early federal agency regulation involved no smoking zones in public transportation. In 1988, Congress banned smoking on domestic flights that were less than two hours in duration. In 1990, this ban was extended to most domestic flights. Government facilities and private employers, often voluntarily, started to restrict smoking to certain areas. State and local governments started to pass laws for nosmoking areas in public and commercial facilities, such as restaurants. Gradually, public opinions changed. There is now less tolerance for smokers, and policy is switching from no-smoking zones to complete smoking bans in commercial buildings, including restaurants and bars. A factor contributing to privileging nonsmoker rights is the decline in smokers' political influence. This decline has occurred for three reasons. First, the voting power of smokers has been cut in half, as the percentage of adults who smoke cigarettes has shrunk from 42 percent to 21 percent. Second, people who continue to smoke are disproportionately in lower socioeconomic groups and are thus less politically influential. Third, smokers have been increasingly viewed in a negative light. They are perceived as lacking the will power to quit and as being inconsiderate to nonsmokers. As a result of viewing smokers more negatively, some employers, such as the states of Alabama and North Carolina and General Electric, charge smokers a higher health insurance co-pay. Some states or local jurisdictions allow employers to refuse to hire smokers. For example, in Ohio, where such employment policies are allowed, the Cleveland Clinic, Summa Health, Scotts Miracle-Gro, and USI Financial Services do not hire smokers.7 Corporate Liability The basic premise supporting corporate liability is that cigarette companies have failed to behave responsibly, so the legal system should force them to pay for the social costs (externalities) of smoking. Early attempts to establish corporate liability occurred through a series of personal injury lawsuits. For nearly 40 years, the U.S. tobacco industry was able to outspend and outlast litigants, despite steadily increasing knowledge about the health effects of smoking. From 1954 until 1992, 813 cases were filed against cigarette companies, but only 23 went to trial. During this period, the companies never settled out of court and never paid a penny to plaintiffs, although their legal expenses were large. The early suits claimed that tobacco companies were negligent in not warning customers or that there was an implied warranty of safety. The industry's initial defense was that the scientific studies were inconclusive. Although this defense may have been legitimate early on, it became increasingly unviable as both public and concealed in-house information mounted. Starting in 1983, plaintiffs changed their arguments to focus on strict liability. At this time, the industry switched its defense to a position that the health risks were common knowledge, and the defendant should have been aware of these risks and therefore had assumed responsibility for his or her health outcomes. The package warning labels that had been mandated since 1966 buttressed the industry's defense. Comparative fault principles were beginning to be applied to product liability cases in this period, with many states disallowing damages unless more than 50 percent of the responsibility could be assigned to the defendant. Although many juries did believe that the companies were partly at fault, they overwhelmingly believed that individual smokers bore more than 50 percent of the responsibility for their own health outcomes. Starting in the 1990s, antismoking advocates focused on a new tool for corporate liability framing: intentional nicotine addiction. It had long been recognized that quitting smoking was difficult. In fact, some members of the 1964 surgeon general's committee wanted to label cigarettes and nicotine as addictive, but the decision was that the evidence was insufficient. Instead, the report indicated that tobacco was habituating. This was the official position until the 1988 Surgeon General's Report, which declared that nicotine exhibited addictive properties similar to hard drugs. Flush with money from asbestos litigation, tort lawyers viewed nicotine addiction as an opportunity for profitable class-action personal injury lawsuits. Such suits accused cigarette companies of manipulating nicotine to enhance addiction, intentional misrepresentation, concealment, and failure to disclose information. Other class-action suits accused cigarette companies of defrauding current and former smokers of "light" brands by suggesting that these were less hazardous than higher tar cigarettes. It was not necessary that the plaintiffs had experienced negative health outcomes, but merely that they were deceived and hence suffered economic damages. Light cigarette and other litigation continue to take place in both state and federal courts. Notably, a large number of personal injury suits in Florida have been spun off from a disallowed class action suit. Decisions in the initial trials have largely been going against the tobacco industry, but these and many other decisions are being appealed.8 State Government Litigation Following the lead of the attorneys general from Florida, Minnesota, Mississippi, and Texas, in June 1997, attorneys general from 39 states (supported by a battery of contingency fee-based tort lawyers) sued for penalties, punitive damages, and recovery of Medicaid costs associated with smoker illnesses. They cited a conspiracy to mislead smokers and the public. In particular, they claimed that the companies had violated antitrust and consumer fraud laws by withholding information, had manipulated nicotine levels to maximize addiction, and had conspired to prevent introduction of lower risk products. Interestingly, some expert analyses show that state expenditures for smokers are actually lower than for nonsmokers because reduced life expectancy decreases nursing home and pension expenses, and this more than offsets other costs. This is clearly an ethically unsustainable argument, and the industry's ethical and legal positions were already rapidly deteriorating. Many incriminating internal documents were now available to the public, and millions more pages became available during the states' litigation. The stonewalling strategy that had enabled the industry to weather more than 30 years of attacks was now crumbling. Considerable uncertainty remained relative to the ultimate outcome of the states' suits. Juries still tended to support the industry, laws in most of the states were not favorable to this type of suit, and many of the attorneys general were lukewarm to the approach. Nonetheless, the industry was likely to lose in at least some of the states. Given the considerable resources of the states and the impressive war chests of tort lawyers, it was questionable whether the industry could afford to go the distance. Accordingly, the industry decided to pursue a negotiated settlement with the states for the purpose of managing its liabilities. Four states settled individual lawsuits for a total of $40 billion. The remaining states, most of which had weak cases, banded together to negotiate the Master Settlement Agreement of 1998 (MSA).9 The MSA required payments of $206 billion over 25 years to the participating states in exchange for protection from suits by the state governments. This still left them vulnerable to federal suits and private class actions, as well as individual suits. The settlement also contained marketing restrictions and required the industry to disband its lobbying and research organizations. 10 11 they ~ prod, pellet ing. I the p duet disso findil ( thai Federal Litigation Soon after the dust settled on the MSA, the federal government filed its own lawsuit, charging fraud and concealment and seeking reimbursement of its health care costs. The health care cost actions were dismissed, but the Justice Department was permitted to proceed with its "unlawful conduct" case under the Racketeer Influenced and Corrupt Organizations Act (RICO). The federal government sought equitable relief via disgorgement of $280 billion in allegedly ill-gotten gains. The government's economic consultants claimed that this was the invested value of $76 billion they calculated that the industry earned between 1971 and 2001 from smokers who were lured into nicotine addiction before age 21 because they were manipulated by tobacco advertising. Prosecution arguments attempted to establish an ingrained pattern of fraudulent behavior by demonstrating that the industry concealed information about cancer and addiction, manipulated nicotine delivery, marketed to children, and misled people into thinking that "light" cigarettes were safer. In 2006, a federal judge ruled that the cigarette companies had violated racketeering laws by deceiving the public about the harm caused by cigarettes but stated that she did not have the authority to order major financial remedies. The companies were ordered to stop using terms such as "light" and "low tar" and to put additional warning labels on cigarette packs. The Justice Department petitioned for Supreme Court review of the decision but was turned down. I 1 In addition to ongoing litigation and appeals at federal and state levels, a number of current activities relate to cigarettes. For example, recently considerable focus has been placed on raising both state and federal excise taxes on cigarettes. The most frequent justification offered by antismoking advocates for higher taxes is that higher retail prices discourage youth smoking. There is also some rhetoric that the higher retail prices provide more incentive for adult smokers to quit. The inference here is that excise taxes are needed to send pricing signals to "protect" people who are apparently not sufficiently rational to respond to medical evidence. Occasionally, it is inferred that smokers should help pay for the medical cost burdens they impose on government and society. The bottom line is, however, that both state and the federal government are becoming increasingly dependent on cigarette-related revenues. Cigarette companies are shifting their focus to smokeless tobacco products, asserting that they are safer because they have lower levels of carcinogens and are not absorbed in the lungs. In addition to traditional snuff, these products include snus (spit-free tobacco in pouches) and flavored, dissolvable pellets and strips.12 Men es te Arne to fe tot panl still po Phi and A number of public debates concern smokeless products. The first is whether they are, in fact, safer. Even if they are safer, a second debate is whether any tobacco product is sufficiently safe. A third concern is whether the mint- or cinnamon-flavored pellets, which look rather like Tic Tacs, are designed to lure young people into smoking. Even though the containers have child-proof designs, another concern is whether the pellets should be illegal because the products could be poisonous to small children due to the high level of absorbable nicotine. The FDA is working on a policy regarding dissolvable nicotine products and has asked Reynolds to provide its market research findings. One of the most sensitive issues facing the FDA is establishing a policy on menthol flavoring. Menthol products make up around 70 percent of the U.S. market. Menthol masks the harsh taste of tobacco, and critics claim that menthol increases teen smoking. Because menthol products are particularly popular with African Americans, charges of predatory marketing have been raised. Congress was not able to resolve the menthol issue in its legislation and passed this political hot potato on to the FDA, requiring it to develop a policy by 2012. Because smoking has been on the decline in the United States, cigarette companies increasingly are looking toward other countries where growth opportunities still exist, particularly developing countries. In order to focus on these growth opportunities, Philip Morris International (PMI) has been completely split off from Philip Morris USA. This allows PMI to pursue growth strategies free of political and litigation problems. Antismoking activists, however, are gaining strength in the international arena, supported by an antismoking treaty brokered by the World Health Organization. The treaty requires the 168 signatory countries to implement excise taxes, warning labels, and marketing restrictions. Consequently, PMI is moving quickly to gain share before marketing restrictions are fully phased in. The company claims that it is not wooing new smokers, but rather encouraging existing smokers to switch to higher-quality cigarettes. Other international cigarette companies are also seeking to grow their businesses before more marketing restrictions are implemented. u.s. 1. Who is primarily responsible for a teenager's decision to smoke-the individual teen, peers, parents, school, church, government, cigarette companies, or retailers? Why? marketing constraints should be in place? Should these be voluntary or regulated? Should some consumer segments receive more protection? 2. Should cigarettes be illegal? Which stakeholders would be impacted by such a law? Which rights must be weighed? 5. Should governments levy excise taxes on other products that can have negative health impacts, such as soft drinks? Why? If so, what products should be taxed and how high should the tax be? 3. How ethical or unethical are the actions and behaviors of the following parties in this case study: cigarette companies, antismoking activists, smokers, politicians, retailers? Provide examples to support your position. 4. Identify a consumer physical, economic, product that can cause or social harm. What 6. What should be done flavored cigarettes? Why? about menthol- 7. What policies should be enacted concerning flavored tobacco pellets? 1 2 3 4 WHO Report on the Global Tobacco Epidemic, 2009 (Geneva, Switzerland: World Health Organization, 2009), available at http://whqlibdoc.who .int/publications/200919789241563918_eng _full.pdf, accessed 8/31/10. http://www. who.intlmediacentre/factsheets/fs3391 enlindex.html, accessed 8/31/10. Centers for Disease Control and Prevention, "Surveillance for Selected Tobacco-Use BehaviorUnited States, 1900-1994," CDC Surveillance Summaries, MMWR 1994; 43, No. SS-3 (Washington, DC: U.S. Government Printing Office, 1994). Excellent sources for historical information on the cigarette industry include Martha A. Derthick, Up in Smoke: From Legislation to Litigation in Tobacco Politics, 2nd ed. (Washington, DC: CQ Press, 2005); A. Lee Fritschler, Smoking and Politics: Policy Making and the Federal Bureaucracy, 4th ed. (Englewood Cliffs, NJ: Prentice Hall, 1989); Richard Kluger, Ashes to Ashes: America's Hundred- Year Cigarette War, the Public Health, and the Unabashed Triumph of Philip Morris (New York: Vintage Books, 1997); Fred C. Pampel, Tobacco Industry and Smoking (New York: Facts on File, Inc., 2004); and Robert L. Rabin and Stephen D. Sugarman (Eds.), Regulating Tobacco (New York: Oxford University Press, 2001). Ronald Bayer and James Colgrove, "Children and Bystanders First: The Ethics and Politics of Tobacco Control in the United States," in Eric A. Feldman and Ronal Bayer (Eds.), Unfiltered (Cambridge, MA: Harvard University Press, 2004), pp. 8-37. 6 Maia Szalavitz, Secondhand Smoke: Nuisance or Menace? Statistical Assessment Service, June 2, 2003, available at http://stats.org!storiesI2003/ secondhand_smokejun3_03.htm, accessed 8/31/10. 7 Jim DeBrosse, "Ohio Employers Saying No to Smokers to Reduce Costs," Dayton Daily News, February 22, 2010. 8 Bob Van Voris, "Big Tobacco Gets Its Many Days in Court," Bloomberg Businessweek, May 24, 2010. 9 The Master Settlement Agreement is available at http://www.ag.ca.govltobacco/pdf/lmsa.pdf.accessed 8/31/10. 10 W. Kip Viscusi, Smoke-Filled Rooms: A Post-Mortem on the Tobacco Deal (Chicago, IL: University of Chicago Press, 2002). II Duff Wilson, "Supreme Court Rejects Appeals of Tobacco Ruling," New York Times, July 29, 2010. 12 Duff Wilson, "Tobacco," New York Times, May 4,2010; and David Kesmodel, "In Tobacco Giant's Makeover, No Smoke, But Plenty of Fire," Wall Street Journal, March 26, 2010. 5