HR 5034: The Prohibition/Monopoly Legislation

For more than six months I have been made crazy by the concept that 151 of our Congressman feel that the wine, beer and spirit wholesale companies need protection from the big, bad small producers and the consumer!

The idea that a legislation is needed to protect big business is silly. As they saying goes in politics, just follow the money. And there is plenty to follow in this battle, the NBWA (National Beer Wholesalers Association) is the 4th largest political contributor. They have contributed 2.6 million in the most recent election cycle.

In Long Island, we have an expanding wine industry with more than 40 wineries. Tim Bishop is one of the sponsors of the HR 5034 Bill, which makes no sense at all as it is anti-winery. Alas, Mr. Bishop has taken as much as $30,000 in campaign contributions from the NBWA. Oops, that seems to have back-fired as he is in a major race to stay the Congressman. Right now there is a recount happening that shows his opponent about 400 votes in the lead. Very interesting as there are 40ish wineries...hmm, 10 votes per winery going against Bishop!?! I just wonder.

Wine in New York Grocery Stores & Chains

New York is the third largest wine producing state, behind California and Washington State. Both of those states have wine in grocery stores and thriving (though currently suffering from a weak economy) wine industries. So why should New York be different? First and foremost is because, the New York SLA (State Liquor Authority) has had laws in place that have made the small wine and liquor retail establishments stay that way. The laws in place make it illegal to have multiple stores, illegal to have buying co-ops with other stores and many other laws that have made it difficult to do business for wine stores. To change all that overnight so that the Governor can add a couple of percentages to the budget is anti small business, but to keep the laws the same is anti free-trade. SO there must be some kind of a compromise, and the little added nuggets to placate the small wine stores owners is not enough.

If this law is changed without more adjustments to it, there will be a ripple affect that will start with wine & liquor stores and bounce all through the New York wine industry and when that happens it will come back to haunt the government. As of now there are many attacks on this legislation from within the wine industry and many advocates that want in. What's best for the consumer and the small businesses and employment? I personally don't believe passing this as is will be good for those and will mostly benefit big corporate america. Hurray, wasn't it big corporate america that caused the economic downturn that means Governor Paterson needs to find more revenue for the state? So giant corporations broke it, lets give big corporate america a payoff so the Governor can add a few million (less than $100M) to a multi-billion dollar problem.

Don't get me wrong, I am not anti-trade or anti-competition, but lets not do this without any thought for small business while giving big business a wind-fall. And don't kid yourself about prices changing drastically - the New York Wine Retail industry competes now with California and their big Supermarket Chains due to internet wine sales.