In the Doghouse

In the Doghouse: 'Tis the Season for Deregulation: 2014 Alcohol Legislative Snapshot

 February 20, 2014

Big Alcohol spends millions each year on political contributions and lobbying to dismantle alcohol regulation.
Just 6 weeks into the new year, legislative proposals to decrease or eliminate alcohol regulation abound:

  • Multiple bills in 5 states (Connecticut, Hawaii, Michigan, New Jersey, Washington) would reduce current excise tax rates
  • Ohio Rep. Dan Ramos is sponsoring a bill to increase the allowable ABV in beer from 12% to 21%, and keep the associated minimal tax rate
  • The New Hampshire State Senate gave preliminary approval for the Finance Committee to review a bill that would strike down a ban on alcohol billboard advertising
  • Bills that would expand access to alcohol have been proposed in 3 states (Kansas, Tennessee, Missouri)
  • In Oregon, the Northwest Grocers Association (read Costco, Walmart and Safeway) is the sponsor of a voter initiative that will be on the November ballot to allow sales of spirits and wine in grocery stores, undermining the state monopoly on sales.

  • Each of these proposals dismantles effective, evidence-based policies to reduce alcohol-related harm: decreased access to alcohol; state control over wholesale, distribution, and/or retail sales; and increased prices through taxation. Who wouldn't want evidence-based alcohol policy? Who would influence legislators to support proposals that will contribute to alcohol-related harms?

    Big Alcohol, that's who. Alcohol producers have an inefficiency problem, according to economists. Having exhausted corporate reach into production by buying one another out of market share, the easiest way producers can expand their ever-increasing profits is to make alcohol cheaper and more easily accessible. How can they do that? By controlling as much of the distribution and retail sales as possible. Big Alcohol fights tirelessly to chip away the 3-tier system that was designed to check its political power. Big Grocery, knowing that the cheaper the alcohol, the more customers in the stores, has joined the alcohol deregulation fray.

    Big Alcohol and its industry trade groups exerts hefty influence on legislators, adept at flying under the public radar. Alcohol lobbyists haunt the halls of both Congress and state legislatures, spending big bucks on lobbying and political contributions. A quick look at its Congressional lobby spending in 2013 provides some telling examples:

  • Anheuser-Busch InBev, the world's largest beer producer, is known by the Center for Responsive Politics as a heavy hitter, one of the top 140 biggest overall donors to federal elections since 1990. A-B InBev's pet bill in the 113th Congress was the Brewers Excise and Economic Relief Act of 2013, a giant beer tax cut for beer producers.
  • Diageo, the #1 distilled spirits producer, ranks in the top 5% of all political contributions and 7% of all lobbying money spent.
  • The Distilled Spirits Council of the United States (DISCUS) spent over $5 million on lobbying and almost $77,000 on political contributions last year.

  • The influence bought by these lobbying activities has effectively thwarted billions in potential government revenue in tax increases, undermined state trade regulations provided by the 21st Amendment, and dismantled laws intended to protect public health by limiting access and availability to alcohol. Big Alcohol's legislative battles are not only about privatizing state control; the constant chipping away at regulations endangers public health and safety as well.