craft brew

Colorado Governor Hickenlooper Overturns Low-Alcohol Ban

by Michelle Minton on May 18, 2011

in Personal Liberty, Politics as Usual

On Friday the 13th, just before happy hour, Colorado’s Governor John Hickenlooper signed into law a bill that reversed the only victory in years for those fighting to get full-strength beer in grocery and convenience stores.

Governor Hickenlooper’s intentions aren’t malicious. A former brewer, Hickenlooper is simply trying to preserve the system that his craft brewing constituents assert creates the best environment for craft beer. That system divides beer into two categories: low-alcohol or 3.2 beer, which grocery stores and convenience stores may sell, and high-alcohol beer, anything above 3.2, which liquor stores, bars, and restaurants may sell.

As I have written before, the craft brewers are mistaken in their assumption that grocery store sales would have a negative impact on craft beer in Colorado. And even the liquor stores, who assert that grocery store sales of beer would put them out of business, could thrive in a liberated market.

Grocery and convenience stores backed by consumers who want cheaper more convenient options have asking year after year for the state to have one definition for beer and to allow beer to be sold, regardless of the alcohol content, in grocery, liquor, and convenience stores, as well as bars and restaurants. Yet, for at least four years running, all the bills introduced in the state legislature to change the beer regulations have been knocked down. Until last year.

Frustrated with yet another failed attempt, proponents of “real beer” in grocery stores had an ally in the state legislature attach an amendment to another bill, which passed, forcing the state to begin enforcing all of its liquor laws to the letter. What this meant, in effect, was that bars, restaurants, and taverns were banned from selling low-alcohol beer. Though the rule had been on the books for a long time, the state had never enforced it.

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New “stimulus plan” brewing in Congress

by Michelle Minton on July 8, 2010 · 1 comment

in Culture, Deregulate to Stimulate, Economy, Employment, Odds & Ends

It is actually less of a “stimulus” plan and more of a “get government out of the way and stop inhibiting growth” plan. A bi-partisan group of Senators led by John Kerry (D-Mass) introduced S. 3339 in mid-may, a bill that would, among other things, reduce the federal excise tax that small brewers must pay per barrel they produce.

For the congressmen and Senators selling this proposition, it probably wasn’t the brightest idea to associate the tax-cutting-proposal with the word “stimulus” which now evokes memories of massive taxpayer-funded bailouts to government favored businesses that probably should have failed years ago due to inefficiency and sheer ineptitude.

Unlike the auto, construction, and real estate industries, small brewers in the US have made great strides in the last decade despite heavy taxes, discriminatory regulations, layovers from prohibition, and a recession. Craft beer is more popular among US drinkers than ever before. Given the opportunity in a free market, small The Three Beersbrewers could collectively take a large chunk of the market away from the monolithic “big beer” companies like Anheuser, Coors, Budweiser, etc. They could lower prices, increase production and distribution, hire more workers and contribute more in tax revenue. But there’s a built in disincentive for small brewers to grow–if they get too big they loose the one advantage they have over bigger brewers: the tax benefit.

So yes, cutting taxes will help small breweries stay afloat and grow, but it isn’t enough for true stimulation of the beverage industry. To create jobs, increase the number of small brewers, increase competition, and massively reduce the cost of purchasing beer, congress should eliminate the tax on beer.

Consider that brewers not only pay the federal excise tax, but also a state excise tax in addition to all the other fees and costs. In 2004 the Beer Institute estimated that taxes represented over 40% of the retail cost of beer. Imagine that! Without the tax burden on producers your craft brew would cost just $3.50 instead of $6, your Budweiser would cost $1.50 and a miller high life would only cost you your dignity (just kidding, I drink high life).sam-of-dogfish-head

And for some states protecting the small brew business is especially vital. Take Oregon, for example, which has more microbreweries per capita than almost any other state. Small brewers alone provide the state with nearly 5,000 jobs and over $2 million in revenue. In fact Oregon has more small breweries. While some legislators hear those numbers and can only see ways to leech off that success (as I wrote about back in February 2009) it is good that other legislators seem to understand the principle that if you get government out of the way of business, there are more jobs, more money, and more stuff. Perhaps if they could just apply that logic to all other businesses, including big brewing companies, we’d be a lot better off.

LibertyWeek 32: FCC Don’t Tread on Me

by Richard Morrison on March 5, 2009

in CEI Projects, Podcast

Your hosts Richard Morrison and Cord Blomquist bring you Episode 32 of the LibertyWeek podcast with special guest Sam Kazman and surprise guest co-host Jeremy Lott. We start by looking into the possible future of the Federal Communications Commission with nominee Julius Genachowski about to ascend to the chairmanship, and then take another stroll through the New Great Depression with high-level financial talks between unpopular British Prime Minister Gordon Brown and über-popular President Barack Obama. Oregonian brewers fight a proposed fifteen cents a pint tax in Beer News, and the Lady Madoff tries to stash away tens of millions from the feds in this edition of Scandal Watch. We hit our stride with an interview with CEI General Counsel Sam Kazman and his tales of the icy global warming rally staged earlier this week here in Washington, D.C. Finally, a little belt-tightening Olympic News from the USOC.

Listen here!