06 Jan 2013 @ 11:27 PM 

This is a very late entry into this debate, and there’s a good reason why: I’ve been having a hard time articulating to myself just why I think the debate has been so… well.. wrong. I tried recording a podcast about it, but I was just a rambling mess (more so than usual) and so I felt like the best way to approach this was through writing.

To cover the backstory: Back on December 13th, a few high ranking members of the BA wrote an article in the St. Louis Dispatch titled Craft or crafty? Consumers deserve to know the truth in which the authors attempt to call attention to the problem of “faux craft” beer being made by the large international conglomerate breweries, namely Anheuser Busch-InBev (ABI) and MillerCoors, henceforth to be referred to this in this article as The Duopoly (because that’s what they are). It was timed to coincide with a press release by the Brewers Association titled The Beer Drinker’s Right to Know, which seemed to be a response to this insane interview on Forbes/CNN titled Big beer’s response to craft: If you can’t beat ’em, join ’em which contains some crazypants quotes from the Executive Chairman of SABMiller like

“There’s a huge debate in the craft world about us, all big brewers, because we’re like the enemy. We’re the other guys. They think we’re stealing their authenticity. What we say is, “Let the consumer decide.” If we’re authentic enough for the consumer, that’s authentic enough for anyone.”

and

“I don’t think the craft movement in its current guise will continue to grow indefinitely. I don’t think it can. It’s not economic. Too many people won’t make any money. Too many of them will go out of business. And I think it will become less fashionable. These things are fashion to some extent.”

Though if I had to guess, what the BA was really responding to is this:

“We have our own craft brands. We also look selectively to acquire, or form partnerships with, or cozy up to people who have incubated good businesses. It’s difficult for big companies to incubate small brands. That, at its heart, is the dilemma. To start a small brand in a credible, consistent, sticking-to-it kind of way is hard for big companies. That’s what small entrepreneurs do best.”

because that is, in reality, the heart of the matter. By the by, that article was actually a followup article to one that came out back in November titled Big Beer dresses up in craft brewers’ clothing, which nobody seemed to take issue with.

Unfortunately, the BA press release and article was taken as an attack and was received with vitriol by some of the country’s smaller brewers that happened to land on this list of Domestic Non-Craft Brewers. They pissed some people off and, frankly, I don’t blame them for being pissed. At least one of those brewers – D.G. Yuengling & Sons – was welcomed warmly during the keynote address at the Craft Brewers Conference a couple of years ago in a we’ve-expanded-our-definition-so-you-can-be-craft-now moment. Throwing them under the bus on this chart is.. well.. kinda crazy. Until this chart, I didn’t realize that the BA didn’t consider them craft anymore.

I won’t summarize the response that the BA received from August Schell. I think it sums up the sentiment that was expressed out and around the internet quite well. You can read it here: August Schell’s response to Craft vs. Crafty on Facebook

Now, here’s my thought on the whole thing:

Faux-craft can be a threat, but not – I think – in the way that this concerted press release and chart make it out to be. It’s not because consumers might be confused into thinking that some shit Shocktop Wheat IPA is craft. It’s because consumers might not have the chance to have a choice in the matter.

One of the biggest warning shots that craft has had fired across its bow in the past 30 years was the AB-InBev purchase of Goose Island. There are a million and one reactions to that purchase and most of them are ridiculous because they’re either about whether or not the beer is going to suck now or whether or not it should still be counted as craft.

I’ll tell you: No, the beer will not suck. No, it is not craft. Done. Happy now?

The problem, I think, is a far more complicated one than it appears on the surface. Here’s why the Goose Island purchase is a threat:

Because Goose Island is good beer with a good reputation that people like and have heard of.

Why is that a problem? Because AB-InBev has a program that it runs with its distributors whereupon you can become an “aligned distributor”. That means that you purposefully exclude products not from the AB-InBev catalog from your sales. In return, you receive excellent lines of credit, better pricing on your products, and all kinds of interesting incentives that give you a competitive advantage in the market. Here’s a quote from the Wholesaler Family 2011 Consolidation Guide (lifted from The Washington Monthly: Last Call):

We ask all wholesalers to use the guide’s self assessment tool to objectively consider their capabilities and goals. Wholesalers who aspire to be an Anchor Wholesaler can identify any gaps they have in these qualities and build a plan to address them. Some wholesalers might remain committed to their current market, but realize further acquisitions are not right for their business. Others might decide now is the best time to consider whether a sale is in their best interest.

There are many aspects of an aligned wholesaler, and an explicit focus on our portfolio of brands is paramount. Those who are aligned with us only acquire brands that compete in segments underserved by our current portfolio and that bring incremental sales, not brands that have a negative impact on the A-B portfolio.

In a nutshell: our brands are your priority.

Okay, fine, you say. So craft doesn’t sign on with a Bud distributor. Big deal. Except that the country doesn’t have very many distributors with the same kind of reach and network that the two big houses do. To not sign on with those distributors – in most markets – is to put yourself at a significant competitive disadvantage. Unfortunately, to sign on with those distributors – in most markets – seems to now put yourself at a significant competitive disadvantage. Because now, when a bar says, “Hey – my customers keep asking me for a Pale Ale – can I get one of those?” The Bud guys can say, “Sure – Goose Island Honkers Pale Ale coming right up.”

Not that they wouldn’t say that anyway, but now they have incentive to push it harder. It doesn’t seem like much. Alone, it’s not.

Education is key

Part 2 of the problem is that there is awful – and by awful, I mean fucking TERRIBLE – education about beer in the bar and restaurant market. Here’s the thing I find the most embarrassing in restaurants: when they’ve put time into crafting the most beautiful wine list in the world, and the beer they offer is Heineken or Amstel Light or something because that’s imported fancy beer. There is a really large emphasis on wine education in culinary institutes, but unless a chef has a personal preference for beer it is basically ignored. This goes doubly when it comes to management and server training. So, unless you’ve gone out of your way to hire a huge beer geek at your restaurant to run your beer list, an IPA is an IPA and Honkers or Shocktop Wheat IPA or Leinenkugel Big Gig is just as good as Pliny the Younger. I mean.. hey – is it cheap? Then, cool, get it.

That’s why faux-craft is a threat: not because craft drinkers might be somehow duped into thinking that some other beer is a craft beer, but because new craft drinkers might never get the chance to have anything else. It’s not an awareness problem, it’s a market share problem. Nobody doing purchasing at Wal-Mart is going to be a big enough beer nerd to call out a distributor on pushing a faux craft instead of a craft, so nobody who shops at Wal-Mart gets to see anything else. Not a big deal, right? Except that that’s the single largest retail outlet in the country.

(Alternate argument says, “But those people are learning about craft and might eventually move onto other brands,” which is legitimate. My argument to that says, “People are lazy and if they can buy a six pack with the rest of their groceries, they will. It takes education and affluence to go to a beer-only store.)

The BA has posted articles about the need for more education in bars and restaurants before, but it didn’t receive the same kind of attention that last press release did. I guess it’s easy to write off Garret Oliver as an elitist jerk, which might be one of the single wrongest sentences I’ve ever written. He’s right.

The Definition of Craft is Misguided and Outdated

Part 3 of the problem is the definition of craft. The basis of the definition is written around tax guidelines – or worse, proposed tax guidelines written in legislation that hasn’t passed yet. If you’re anywhere near the craft industry at all, you’ve seen this definition before:

Small: Annual production of 6 million barrels of beer or less. Beer production is attributed to a brewer according to the rules of alternating proprietorships. Flavored malt beverages are not considered beer for purposes of this definition.

Independent: Less than 25% of the craft brewery is owned or controlled (or equivalent economic interest) by an alcoholic beverage industry member who is not themselves a craft brewer.

Traditional: A brewer who has either an all malt flagship (the beer which represents the greatest volume among that brewers brands) or has at least 50% of its volume in either all malt beers or in beers which use adjuncts to enhance rather than lighten flavor.

This summary might better explain what a craft brewer is: Not The Duopoly.

In the grand scheme of things, the definition here isn’t that bad. Small and Independent I can get behind (except for the definition of 6 million barrels as small – that is complete bullshit), what makes the definition wonky here is “Traditional”. Everything about this definition is about taxes and business size and that Traditional part of the definition means that you’re making a quality call in the middle of the definition.

I’ve thought about this a lot, and it goes against what I’ve said for years, but here’s what I think should be the definition of a craft brewer: A brewery that isn’t publicly traded on the stock market.

Because when you put quality into the definition of what a craft brewery is, you run into another problem.

Craft beer does not mean “good beer”

Part 4 of the problem is that people are confused about what is craft beer and what is good beer.

Craft beer does not mean good beer. There’s a lot of shitty craft beer out there. Sorry to say. Just because you’re small doesn’t mean you know what the hell you’re doing. It doesn’t mean you know how to build a recipe or package without an infection. It just means you’re small. If you want to say small breweries are craft breweries, then cool – that’s a craft brewery. But if you start making quality calls in the definition then there are a lot of breweries that are going to need to turn in their “craft” badge.

So what does that mean? It means that Utica Club and Yuengling and August Schell and Genessee and all that light beer with corn in it is probably craft. You might not like it, but you don’t stay open for 150 years because your beer is shitty, so deal with it. It also means that Sam Adams (SAM) isn’t, nor is the Craft Brew Alliance (BREW) or Mendocino (MENB), Sackets Harber Brewing Company (HBWO), Big Rock (BRBMF) or, of course The Duopoly (BUD, TAP) or any of the other international conglomerate breweries.

So, if I can sum all of this up: Craft vs. crafty. Is it an issue?

Yes, but not in the way it’s made out to be. Faux-craft is a problem because the big breweries control an unreasonable share of the market (80+%!) and, thus, have a stranglehold on the distribution system, meaning that they can control the flow of product in many markets. If they can give the mid-level suppliers – who are often poorly educated about the product they’re buying – an easy alternative to a higher priced product, regardless of how “cool” local is, they’ll control the market share and, thus, put small breweries out of business.

The BA’s position statement was, by all means, appropriate (somebody has to be a watchdog for the craft industry and call out the big guys, because craft brewers are so stupidly apologetic about The Duopoly). But, it is clouded by the fact that their own self-made definition of what craft is has a (recent!) history of changing to suit their priorities and contains a basically unenforceable criteria – quality – that they insist on enforcing based, it would appear to most outsiders, on beer color.

Drinkers are confused about what to do with this position statement because they’re being told that beer that they consider “good” (Goose Island, Ommegang, Magic Hat, Pyramid, Red Hook, Leinenkugel, etc.) is apparently “bad” because they falsely associate “craft” with “good”. In reality, those breweries are NOT craft, based on taxation definitions alone and it is not – and should not be – a measure of how good their beer is, merely whether or not they can join the Brewers Association.

Final word. Support your local brewery. If the big guys get their way, your local brewery will go away and the BA or anybody will be powerless to stop it because so many craft drinkers can’t be bothered to draw a line in the sand. The number of conversations that I have with craft beer drinkers that have an element of, “Yeah, but a Miller High Life on a hot day is awesome!” is astounding. No it’s not. It’s gross, just like it is on any other day. It’s not a good beer. (Oh, the apologetic craft brewer in me says, “But it’s a well made beer!” Sure. Your McDonalds hamburger is a well-made hamburger but it’s still a shitty goddamned hamburger.) You know what’s good on a hot day? A wit. A hefeweissen. A craft pilsner. A foreign extra stout. A really crisp IPA. I can keep going FOR HOURS about what beer is good on a hot day instead of a Miller High Life, and I will no longer compromise.

And you shouldn’t either. Here’s why you shouldn’t support faux-craft – and that includes everything from Blue Moon and Shock Top to (yes, I’m deeply sorry to say this) Goose Island and all the others: Because you’re feeding the machine that is working to remove choice from your life. The Duopoly is a consolidation machine that will, if given the chance, wipe out all competition possible.

Don’t let it.

Additional reading/listening just for fun:

The Street: 10 Craft Beers That Aren’t

Beer Advocate Thread: Craft vs. Crafty

Another definition of, well, not ‘craft’ beer

WUNC: The State of Things – Brewing Beer Battle

Last Call: Industry giants are threatening to swallow up America’s carefully regulated alcohol industry, and remake America in the image of booze-soaked Britain.

The Plot to Destroy America’s Beer

Random Thoughts from Littleton (about the Wholesaler Family 2011 Consolidation Guide)

Share
 09 Sep 2011 @ 3:31 PM 

A brief editorial piece on the website “AshVegas” caught my eye this morning, asking Should Asheville officials offer tax breaks for a [New Belgium] brewery?

I find myself roiling with thoughts and light rage, and so I’m doing what I always do in these situations: write.

Let’s set the stage to begin: New Belgium is working on opening an East Coast plant to cut down on shipping costs on their quest for country-wide domination distribution. There are lots of rumors about Asheville being on their short list of cities to open the plant in and, of course, New Belgium has neither confirmed nor denied these reports (to my meager knowledge).

I have really conflicting feelings about New Belgium. On one hand, they are some of the early pioneers in the craft industry and the industry as a whole has a lot to thank them for. They are leaders in brewing science and innovation. They produce high quality beer and are responsible for a whole LOT of craft beer lovers finding their way to industry in general. They are known as an excellent place to work and they have a strong commitment to being environmentally friendly and generally pretty awesome.

They also have some of the most invasive marketing and distribution tactics I’ve seen in craft. When New Belgium pushes into markets (as they recently did in North Carolina) with multi-million dollar marketing campaigns and sponsorship deals, small, local breweries cannot possibly hope to compete with them. Who sponsors the “local beer, local band” night around the corner from me? New Belgium. Who sells beer at the “Best of the Indy” parties? New Belgium. Who has been at every freakin’ local event before almost every local craft brewery? New Belgium. Why? Because in a morally dubious pay-to-play environment, they have the cash to pay – and pay a LOT – where small local breweries do not.

Is New Belgium the only brewery who does this? No. Good heavens, no. But in North Carolina, they were nowhere one day and everywhere the next, forcefully filling the niche I would have expected a lot of local breweries to fill. While most of that is their distribution partner, New Belgium also doesn’t seem to be in any sort of rush to stop those practices, either.

So, now maybe they’ll actually be a local brewery and that makes me a little sad and a little angry. They feel like a threat to our growing and thriving local beer industry, primarily because they have the ability and the apparent lack of scruples to muscle small business out of the way where they need to.

But that’s not what I really want to talk about. What I want to talk about is the ludicrous idea of offering them tax breaks to move in. The fact that it’s New Belgium makes no difference. My position would be the same for any large brewery moving in; however, the fact that it’s New Belgium in this case does feel a little like insult upon injury.

Tax breaks designed to entice big business is the kind of topic that drives me nuts regardless of industry, but in this specific case – and in MY industry – it seems even more ridiculous than usual. The idea, of course, is that Asheville would give tax breaks to New Belgium to entice them to open a brewery in the area, thereby creating jobs (and tax revenue).

Asheville, look around. You already have 9 breweries in you including the largest craft brewery in the state. Are you giving them tax breaks? Can you imagine how many jobs you could create by easing the tax burden on the businesses that are already there, already a part of your community, and already employing your local population? Instead of throwing money at a business coming in from another state (where most of that money will go), giving a large company with deep pockets even deeper pockets and an advantageous position over your local businesses, why not reward your local businesses for the excellent job that they’ve already done for you?

The local breweries in Asheville, along with its craft-beer-loving populace, have already brought country-wide attention and recognition to the area. Asheville has earned the moniker “Beer City USA” not because of its tax breaks, but because of its (stay with me here, this might get complex) beer. Why on earth would you, as a city council, make it easier to bring a small-business-crushing competitor to town? Sure, you might create jobs in the short term, but in the long run how is that one brewery opening going to effect the already existing breweries in your city and the already existing jobs? How many jobs could you create by reducing the tax burden on the businesses that already exist and thrive in your city, helping them open up new distribution channels, and grow enough to be able to stand up to the largest of breweries?

Tax breaks for incoming industries only make sense when you’re enticing an industry that doesn’t already exist into an area that economically depressed. Neither of these conditions seem true in Asheville.

Here’s the thing: If New Belgium is going to open a brewery in North Carolina, they’ll do it whether or not there’s a tax incentive thrown at them. They’re coming, and the best thing that we can possibly do is fortify our local industry so that we can welcome them as an equal level competitor, an enrichment of the local market. Giving them tax breaks that our local businesses do not enjoy is just inviting a fox into the hen house.

Share
Tags Tags: , ,
Categories: brewery, distribution, industry, NC Beer, news, op-ed, taxation
Posted By: erik
Last Edit: 09 Sep 2011 @ 03 44 PM

EmailPermalinkComments (7)

Sure, you might have been expecting a nice wrapup from the Craft Brewers Conference and trust me, it’s coming. I need a little more time to work on it so that it can be in proper overly verbose form. However, I just returned to my computer and saw a little news item and had to share.

The article is this: Washington House OKs tax plan. That’s the state, not D.C., by the way.

In it, I found this gem, emphasis mine:

The proposal would raise taxes on candy and gum, soda, bottled water and mass-production beer.

[…]

Republicans were united against the bill, contending it wouldn’t treat people equally. Rep. Doug Ericksen, R-Ferndale, noted that beer from large out-of-state breweries is taxed an extra 50 cents a gallon, or about a nickel for a 12-ounce can, but more expensive beer from microbreweries is exempt from the tax.

Hey – that sounds pretty awesome for small brewers, right? Woo! That’s great! Go Washington State! Now check out what followed it up:

“This Legislature couldn’t even be fair on how it raises the tax on beer,” he said. “You stick it to the working man and give the high-fallutin’, high-paid guy in Seattle a break.”

You have got to be fucking kidding me.

Dear Doug Ericksen, R-Ferndale,

Please spend some time with the people who run both types of these businesses and then come back and tell me who is the working man and who is the high-fallutin’, high-paid guy.

Oh, I know you’re talking about the consumer, but these beers – along with gum, soda, etc – are luxury items, not necessities. Nobody needs to buy beer. The consumer can choose to not buy a luxury item that they deem too expensive, that means by raising taxes on these items the person that you are ultimately sticking it to is the producer, not the consumer.

Go back to my first sentence, wash, rinse, repeat.

Sincerely,
Me

P.S. – Asshat.

Share
Tags Tags: , , ,
Categories: op-ed, taxation
Posted By: erik
Last Edit: 11 Apr 2010 @ 12 18 PM

EmailPermalinkComments (3)

Hey! Happy Oktoberfest! Prost! It started on Saturday. I’m sure you know that.

I’m not here to talk about Oktoberfest, but every year Oktoberfest brings the same thing to mind for me: Reinheitsgebot

If you know me in person, and have talked to me about beer, you have probably heard me rail on about Reinheitsgebot at least once. A little story a friend of mine likes to tell involves me ranting on in the kitchen to him over a beer. My wife enters the room a few minutes into the conversation – barely hears any of it – and says:

“Are you ranting about the Reinheitsgebot, again?”

“Yes, dear.”

Fact is this: I respect what people are trying to get at with the Reinheitsgebot. I do. But sometimes I feel like we have some sort of weird misguided loyalty to it. It’s a trade restriction, for crissakes, not a holy writ.

Here’s a translation of it, taken from brewery.org:

“We hereby proclaim and decree, by Authority of our Province, that henceforth in the Duchy of Bavaria, in the country as well as in the cities and marketplaces, the following rules apply to the sale of beer:

“From Michaelmas to Georgi, the price for one Mass [Bavarian Liter 1,069] or one Kopf [bowl-shaped container for fluids, not quite one Mass], is not to exceed one Pfennig Munich value, and

“From Georgi to Michaelmas, the Mass shall not be sold for more than two Pfennig of the same value, the Kopf not more than three Heller [Heller usually one-half Pfennig].

“If this not be adhered to, the punishment stated below shall be administered.

“Should any person brew, or otherwise have, other beer than March beer, it is not to be sold any higher than one Pfennig per Mass.

“Furthermore, we wish to emphasize that in future in all cities, markets and in the country, the only ingredients used for the brewing of beer must be Barley, Hops and Water. Whosoever knowingly disregards or transgresses upon this ordinance, shall be punished by the Court authorities’ confiscating such barrels of beer, without fail.

“Should, however, an innkeeper in the country, city or markets buy two or three pails of beer (containing 60 Mass) and sell it again to the common peasantry, he alone shall be permitted to charge one Heller more for the Mass of the Kopf, than mentioned above. Furthermore, should there arise a scarcity and subsequent price increase of the barley (also considering that the times of harvest differ, due to location), WE, the Bavarian Duchy, shall have the right to order curtailments for the good of all concerned.”

So, mostly it’s price fixing. It’s “don’t charge more than X amount per Mass.” It’s also a grain restriction. It’s not a law decreeing the all-holy purity of beer, it’s a law saying “don’t use wheat or rye.” You’ll also note that it only applies to “all cities, markets and in the country” the Duchy could make beer out of whatever the hell they wanted. They’re restricting commercial breweries.

Why? Well, probably to stop the price of wheat and rye from going up to keep the cost of making bread reasonable. Fair, right? Okay. Fine. In 1871, when Bavaria joined Germany, they insisted on the Reinheitsgebot as a precondition in order to prevent competition from beers made with a wider range of ingredients. In fact, it was even written into Germany’s beer taxation laws in the 1950s, at first only to lagers, but eventually to all ales as well.

Fortunately, the EU had the wisdom to suspend the Reinheitsgebot, saying that it was unfair for trade (because it is) and that anything allowed in other foods may be allowed in beer. However, beer brewed under Reinheitsgebot is still protected as a “traditional food” which seems a little ridiculous. I’ll get back to that.

As it happens, the British had an Ale Purity law, as well. They outlawed the “doctoring of ale, with hops” because of its “psycho-active properties” in 1484, just a few short years before the Reinheitsgebot was proposed in 1487 (it was put into law in 1516). You don’t see people clamoring to stick by that one, do you? Maybe that’s because hops are such a perfect addition to beer… but you know? A lot of other things are good additions to beer, as well. Imagine a summer without wheat beers. Sad.

Myself? I believe, firmly, that the Reinheitsgebot heralded the rise of the bland commercial crap that currently dominates our marketplace. You see, when Reinheitsgebot was enforced in Germany it put an end to a good chunk of old brewing traditions. I’ve read references of spiced ales and cherry ales, and of course even wheat beers don’t jive under Reinheitsgebot, either. In my imagination, Ye Olde Westerne Germanye has a brewing tradition a lot like that of Belgium (which it borders) until somebody slapped this trade restriction in place.

In fact, the rise of Pilsener is directly related to folks in other places mimicking the brewing traditions of Bavaria – it’s even noted in the company timeline of Plzensky Prazdroj, maker of the most famous Pilsener Urquell.

5 October 1842 First brew of Bavarian type beer, bottom-fermented beer, so-called pale lager.

What they don’t mention there is that this happened after the recruitment of Bavarian brewer Josef Groll, the father of Pilsener, who would have been brewing under the restrictions of the Reinheitsgebot his entire life. Why change a good thing, eh?

Pilsener, we all know, is the cultural precursor to Milwaukee’s Best Light Ice. It’s enough to make a man weep.

So, aside from the Reinheitsgebot being the origin of everything that’s wrong with the world of macrobrewing, what else do I have against it?

It’s old and it’s over. It’s marketing talk, at this point. It reduces beer to three components, one of which is technically incorrect. A lot of people like to say that the Reinheitsgebot restricts beer to being made with water, malt, hops, and yeast. Take a gander up there. No malt, no yeast. Sure, yeah. Technicalities. They say “barley” which is then made into malt, yes. And yeast wouldn’t be isolated as an organism for another 2-300 years. Who cares?

I care.

Fact: water, malt, hops, and yeast are the essential ingredients for making beer. They are simply the most efficient ingredients (unless you apply Science to help convert starches into sugars in another, more artificial, “I’m adding a bucket of unrelated enzymes to my mash” way). MOST beers are made out of water, malt, hops, and yeast. Throwing up some fancy-pants label about how “This FINE beverage is made under the restrictions of the Bavarian Beer Purity Law” seems almost somewhat akin to saying that your beer is “Triple-Hops Brewed” or “Cold Filtered.” What you’re saying applies to many, many, many, MANY beers. Why don’t you tell me what makes your beer different, instead?

Giving weight to the Reinheitsgebot also seems to imply that beers made with adjuncts – like many Belgian beers and Abbey ales, for example – are somehow inferior. In fact, many of those adjunct-laced beers are recognized as some of the finest beers in the world. You’re saying they’re not “pure?” Whoop-dee-doo. They’re awesome. That’s what counts.

Finally, I sometimes feel that the weight of the Reinheitsgebot gives us pause when experimenting with German beer styles. Certainly, Americans have (wonderfully) bastardized wheat beers in almost every way imaginable, but for some reason when we talk about a lot of the traditional German beer styles there seems to be somewhat of an effort to get them as close to their Reinheitsgeboty heritage as possible.

By this point, I think that American Craft Brewers have shown that there’s still a lot of new ground to be covered in beer. Let’s not get tied down to this archaic trade restriction as some sort of arbitrary measure of quality. Let’s let the taste buds do the talking, break out of this 400-year-old box, leave the marketing lingo behind, and put the Reinheitsgebot to bed as a historical curiosity.

Share
Tags Tags: , , , , ,
Categories: history, marketing, op-ed, taxation
Posted By: erik
Last Edit: 21 Sep 2009 @ 09 50 PM

EmailPermalinkComments (9)
 08 Jul 2009 @ 2:27 PM 

Local issue today, friends. I think this can probably apply to most places if it has to, but my focus today is the great state of North Carolina.

Dear North Carolina Legislators and Gov. Bev Perdue,

Please stop. There’s been a lot of talk about how to fix the state budget. In fact, we’re a week overdue on a budget, anyway, so this seems like a pressing issue. People keep talking about what to tax to fix this budget shortfall. I’d prefer that the answer be “not beer.” I think I’d also like to say, “Don’t furlough me again.” but really? This is about beer.

I know. Sin Taxes are popular and easy: Tax the things that Portion A of the population fervently believes is bad for Portion B of the population. In doing so, not only will you make money on people who are not Portion A, but it will act as a deterrent for Portion B to buy those evil products. Portion A loves it, and they’re very vocal and often have money, which kind of makes me wonder why we aren’t taxing them.

Just a couple of things:

1) If you’re only taxing a portion of the population, it’s not a very effective tax in terms of income.
2) If you’re using tax as a deterrent on consumption, you’re not planning on making any money in the long run, as the less people buy the evil products, the less money you will make.

Sin Tax seems silly. I’d much rather see a Fat Tax. We know that our health care system is in financial crisis. We know that there’s an obesity epidemic. We know that obesity is a predictor in heart disease, arthritis, diabetes, and early mortality across the board. We know what makes people fat (sugar and (amazingly) fat), so tax that if you want a tax deterrent. I’ve mentioned before that I think that a tax on products containing High Fructose Corn Syrup would be much smarter than a tax on beer, and I still do. But I’m not here to argue that.

No, I’m going to assume, that despite the wonderful efforts of the good people behind Stop the NC Beer Tax (dot com) that you’re going to throw your better judgment to the wind and raise taxes on beer and wine. So instead, I’m going to tell you how to do it.

Consider for a moment that a city in your fair state was recently voted co-Beer City, USA in a poll run by President of the Brewers Association. Consider that, as of this summer, there are ~40 craft breweries either in operation or in the middle of starting up. These are all small businesses contributing to your local economy. They’re creating jobs in communities across the state. Consider that a rise in beer tax will hurt these small businesses – especially the startups – the most.

But hey.. you’re going to tax beer. Portion A must be satisfied. Please consider the following two-part plan:

1) Increase tax per barrel of beer manufactured inside the state of North Carolina by any brewery manufacturing over 15,000 barrels of beer annually (ie – Regional Breweries and larger). Leave the small business out of it.

2) Increase tax per case of any beer imported to the state of North Carolina by any brewery manufacturing over 15,000 barrels of beer annually. Leave your neighbors’ small business out of it, too.

Fact is this: Something like 99% of the beer consumed inside the state of North Carolina is manufactured by a regional brewery or larger – a significant portion of that beer is imported IN to the state of North Carolina. Those breweries are making money in states Other Than Yours – especially the macrobreweries – but most of the small breweries in the state aren’t. They’re distributing locally, often by-hand, in their own communities. They’re getting the tax pinch on every purchase of their product, not just the ones that happen in-state. So how are these small breweries going to deal with the fact that they have a significantly higher cost of operation and, if the Sin Tax works, poorer sales? Will they lay off workers? Will they close doors altogether? In Beer City, USA?

The way to turn the corner on this economic downturn begins and ends with the small business. Don’t hurt them more just because Sin Tax is easy. Help them, and reap the benefits. Maybe take yourself out for a good local beer to celebrate a good deed done for the day, and then ask yourself:

Why are we taxing beer in the first place? Sin Tax is cheap and misguided. There are a million better ways to save money and generate revenue that don’t actively hurt small businesses in our state while at the same time, allowing us all to continue to treat ourselves to a an occasional affordable luxury.

Cheers,
Erik L. Myers,
Self-Righteous Beer Evangelist

If you’re inside North Carolina, please take the time to go Stop the Beer Tax.

Share
Tags Tags: ,
Categories: distribution, industry, RDU, taxation
Posted By: erik
Last Edit: 08 Jul 2009 @ 02 31 PM

EmailPermalinkComments (7)
\/ More Options ...
Change Theme...
  • Users » 130203
  • Posts/Pages » 204
  • Comments » 2,674
Change Theme...
  • HopsHops « Default
  • BarleyBarley

About



    No Child Pages.

Shirts



    No Child Pages.

Tour



    No Child Pages.