seeking help concerning a SENTENCE and a WORD

I am now puzzled by the two questions below:
1) How to interpret this sentence?
Quitting a nervous habit such as smoking can be a vicious circle.

The meaning of the sentence seems puzzling to me. How to understand the word “nervous”? Does it mean “un-relaxed, fidgety” or “something relating to the system of nerves in one’s body”? And then how can “quitting a nervous habit such as smoking” be “a vicious circle”? where does the connection lie?

2) How is the word “all” understood in this sentence?
The board vetoed all the wage increases.

In this sentence, how should the word “all” be understood? Does it modify the verb “vetoed” or the phrase “the wage increases”?

Tons of thanks for yr help in advance!

1)
Here, a nervous habit is something you do one you are nervous (“un-relaxed, fidgety”). Some people smoke when they are nervous in order to calm down - that's why smoking is a nervous habit. Quitting smoking is a vicious circle because when you stop smoking, you become more and more nervous, and you end up wanting to smoke (in order to calm down) even more than usual.

2)
Hm...I guess it modifies "the wage increases". Basically, the board did not approve a single wage increase - I guess nobody gets a raise this year. The meaning of the sentence is not "the board completely vetoed the wage increases"- vetoing is not something you can do halfway.

Aha I see. I truly appreciate yr simple but clear explanation, Mary!:)