In 1612, Englishmen in Virginia found the importance of Tobacco in the economy. It quickly became the staple of the Chesapeake colonies, selling profitably in England. As gold and silver became scarce, the colonies began to rely on tobacco as means of currency because of the safety, stability, and value that the product brings in exchange for gold. Tobacco currency was also used to pay fines and taxes and laws were made to protect it and maintain it. Overall, tobacco provided the colonial governments one of their principal sources of revenue. In 1680, Virginia yielded 3,000 pounds of tobacco, equivalent to $4,541 and between the years of 1758 to 1762, revenue grew to 6,000 pounds worth $9,082. From 1700, proceeds remained steady at 2,500 pounds or $3,784.

 

Throughout the 1800’s and 1900’s, tobacco production and revenue continued to grow steadily, giving support to the states. In 1839, tobacco production reached 219 million pounds and by 1898 it reached over 900 million pounds. 

In the 1900’s, the United States became the world’s leading tobacco exporter and the second largest tobacco produce with over 2.12 million acres available to plant in 1930. In the mid 1900’s, the introduction of cigarettes quickly became the primary product made from tobacco, with a consumption peak at 640 billion cigarettes in 1981, accounting for about 85% of tobacco use. Total expenditures for cigarettes increased about 900% in 1950-1986, from $3.6 billion to $31.8 billion and federal tax collections from cigarette sales rose 367%. In 1985, tobacco production amounted to over $2.6 billion and the US consumers spent about $34 billion on tobacco products.

 

Now, entering the 2000’s, due to the Master Settlement act of 1998, when the four major cigarette manufacturers were sued and told to recover Medicaid and other costs the states incurred in treating sick and dying cigarette smokers, the desire to smoke has decreased dramatically. Smoking is now directly related to economic health care issues and is attributable to expenditures of $96 billion in early 2000s. It is proven that lifetime health care costs for smokers are significantly higher than those of non smokers, creating a different stigma around the idea of tobacco compared to the views in the 1600’s.