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Big Payday For Tobacco Chiefs

Last week cigarette makers saturated not only television and radio with the commercials, but also major newspapers.

All tried to address the same question about the soon-to-be announced tobacco bill, "What's in it for you and what's in it for us?"

What's the ads don't reveal, however, is what's in it for them, the senior officers of the leading tobacco firms. According to the latest records, those officers now stand to make well over $200 million from stock options if the deal goes through.

Company reports filed with the Securities and Exchange Commission reveal 15 tobacco executives now hold options to buy more than 12 million tobacco company shares at prices well below market value.

That means that if the price of tobacco stocks goes up when a deal is struck (as every analyst on Wall Street predicts), then the men holding those options become even richer.

"If you're holding a million options, you're going to make $20 or $30 million in a day or two," said market researcher Jonathan Crane.

Revealing exactly who gets how much out of the tobacco deal should be a major consideration in negotiations, argues Sarah Anderson of theInstitute for Policy Studies which initially tracked the stock options.

"They're trying to convince the American public that this settlement is a bitter pill, that they will suffer, when actually they stand to gain a tremendous windfall," said Anderson.

Company CEOs are supposed to make money for their stockholders, and if they make a bundle for themselves in the process that ordinarily doesn't raise many eyebrows.

The problem here is that this isn't any ordinary deal. It is the biggest public health package in history, which now stands to become the biggest payday in history as well for a handful of cigarette makers.

For Jim Stewart's full report, click above.

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