For Real Change, Beer Advocates Turn to the States

Across the country, states are advocating for crisp, thirst-quenching laws.

Samples of Lagunitas Brewing Company beers sit on a tray during a brewery tour at Lagunitas Brewing Company on February 21, 2014 in Petaluma, California.
National Journal
Emma Roller
March 12, 2014, 11:36 a.m.

State law­makers are look­ing to spur busi­ness wherever they can, but one in­dustry hopes to change loc­al pal­ates as well as loc­al eco­nom­ies: brew­er­ies.

While they haven’t had much luck in Wash­ing­ton, beer ad­voc­ates are hav­ing more suc­cess at the state level. Last year, Alabama be­came the last state to leg­al­ize home brew­ing. A bill wend­ing its way through the state Le­gis­lature this week would al­low lar­ger Alabama brew­ers to open res­taur­ants at their brew­er­ies. The only hitch: No brew­ery in Alabama is big enough to qual­i­fy for the law.

Alabama is work­ing to change that. The state is now try­ing to lure high-pro­file brew­er­ies from out of state, like Stone Brew­ing in Cali­for­nia. In 2012, Alabama ranked 49th in brew­er­ies per cap­ita. But with re­cent laws like the Alabama Brew­ery Mod­ern­iz­a­tion Act, which al­lows craft brew­ers to sell their wares where they’re brewed, Alabama is hop­ing to raise its pro­file as a des­tin­a­tion for brew­ers and beer afi­cion­ados alike.

Still, com­pared with oth­er booze, the beer in­dustry is strug­gling to keep its brand re­cog­ni­tion. Un­like years ago, more people today say they prefer drink­ing wine or li­quor in­stead of beer. Des­pite the re­l­at­ive de­cline of beer’s pop­ular­ity, there has been an ex­plo­sion of craft brew­er­ies around the coun­try — in 2012, the craft-brew­ing in­dustry saw 15 per­cent growth. Lar­ger main­stream products like Blue Moon and Pabst Blue Rib­bon are en­joy­ing rap­id growth. There are al­most 2,000 craft brew­er­ies in the U.S. There’s even a con­gres­sion­al Small Brew­ers Caucus.

And the beer in­dustry has eco­nom­ic ripple ef­fects. Ac­cord­ing to the Beer In­sti­tute, the in­dustry em­ploys roughly 2 mil­lion Amer­ic­ans, dir­ectly and in­dir­ectly, for a com­bined $79 bil­lion in wages and be­ne­fits.

Beer ad­voc­ates have been fight­ing for years to de­crease the fed­er­al ex­cise tax on beer. In 1991, the fed­er­al beer tax was doubled from $9.00 to $18.00 per bar­rel as part of an ef­fort to bal­ance the fed­er­al budget. Taxes were also raised on se­lect lux­ury goods, but were even­tu­ally re­pealed or phased out. Now, beer ad­voc­ates want to roll back the fed­er­al beer tax to pre-1991 levels, ar­guing that it would cor­rect for years of over­tax­ing and bring back lost jobs.

Beer-in­dustry lob­by­ists ar­gue that the beer tax is un­fair, since it un­duly bur­dens the lower- and middle-in­come work­ers who prefer a cheap, cold brewski over a glass of single-malt whisky. “The tax on beer is thus one of the most dis­crim­in­at­ory of all taxes in the fed­er­al and states’ tax codes,” ac­cord­ing to the Beer In­sti­tute.

And Alabama isn’t the only state wrest­ling to ex­pand beer busi­ness and the eco­nom­ic be­ne­fits that come with it:

“¢ Min­nesota beer act­iv­ists are agit­at­ing to re­in­state Sunday sales.

“¢ New Hamp­shire law­makers may re­verse a state ban on ad­vert­ising al­co­hol on bill­boards, and could even vote to al­low res­taur­ants to sell beer to go.

“¢ Con­necti­c­ut may do away with ex­cise taxes on beer, wine, and li­quor, as the state has been los­ing busi­ness across the bor­der to Rhode Is­land, which has lower al­co­hol taxes.

“¢ An In­di­ana law­suit is chal­len­ging the state’s ban on selling re­fri­ger­ated beer in gas sta­tions, gro­cer­ies, and phar­ma­cies, though the law is un­likely to be over­turned.

Still, the fed­er­al beer tax isn’t likely to de­crease any time soon, as Na­tion­al Journ­al‘s Sarah Mimms wrote last month:

The Con­gres­sion­al Budget Of­fice has ar­gued in fa­vor of rais­ing the ex­cise tax, not­ing that the costs of al­co­hol­ism and al­co­hol-re­lated in­cid­ents far ex­ceed the rev­en­ue brought in by taxes on beer, wine, and spir­its. “When ad­jus­ted for in­fla­tion, cur­rent ex­cise-tax rates on al­co­hol are far lower than his­tor­ic levels,” CBO ar­gues. “In the 1950s, ex­cise taxes ac­coun­ted for nearly half of the pretax price of al­co­hol; they now ac­count for between 10 and 20 per­cent of the pretax price.”

While beer ad­voc­ates may be fight­ing a quix­ot­ic battle, law­makers should re­cog­nize the eco­nom­ic good the craft brew­ing in­dustry can bring to their states — or just shut up and drink.

What We're Following See More »
WILL ANNOUNCE PICK BEFORE CONVENTION
Trump to Name VP Search Committee
42 minutes ago
THE LATEST

"Donald J. Trump said on Wednesday that he expected to reveal his vice presidential pick sometime in July—before the Republican National Convention in Cleveland—but added that he would soon announce a committee to handle the selection process, which would include Dr. Ben Carson." He said he's inclined to name a traditional political figure, unlike himself.

Source:
AFFECTS WORKERS EARNING MORE THAN $50K
Business, Nonprofits Panicking Over Labor’s New Overtime Rules
45 minutes ago
THE LATEST

"Groups have flocked to the White House Office of Information and Regulatory Affairs to ask for last-minute changes" to the Department of Labor's new overtime rules, which would require that businesses pay overtime to any salaried employee making more than $50,440 per year, up from the current $23,660. Business interests, as well as some nonprofits, say the move could lead to mass change in workers' statuses, from salaried to hourly. "The White House office held 22 meetings on the proposal in April, according to its calendar, and groups say more meetings are planned this week." Last month, National Journal's Alex Brown reported on how the change might affect Washington.

Source:
KAUFMAN, HUNTSMAN ALSO MAY JUMP ON BOARD
Ed Rollins Joins Pro-Trump Super PAC
50 minutes ago
THE LATEST

Republican gun-for-hire Ed Rollins is hopping on the bandwagon, er, the Great America PAC, "an outside group that’s supporting Trump. ... Rollins isn’t the only GOP mainstay coming around to Trump. In recent days, Republican veterans including Republican National Committeeman Ron Kaufman and former Utah Gov. Jon Huntsman have expressed an openness to him."

Source:
PRESSER IN OHIO THIS AFTERNOON
Report: Kasich Is Bowing Out
1 hours ago
THE LATEST

John Kasich is apparently the last domino to fall on the GOP side. NBC is reporting he's suspending his presidential campaign. His path to the Republican nomination seemed all but impossible—even at a contested convention—but he may have finally given up. The Washington Examiner reports Kasich has canceled a press conference at Dulles Airport, "and will instead hold one in Columbus, Ohio, at 5 p.m."

Source:
CNN/ORC
Clinton Ahead by 13 in Early Going
2 hours ago
THE LATEST

"As Donald Trump captures the mantle of presumptive Republican nominee, a new poll finds he begins his general election campaign well behind Democratic front-runner Hillary Clinton. The new CNN/ORC Poll, completed ahead of Trump's victory last night, found Clinton leads 54% to 41%, a 13-point edge over the New York businessman, her largest lead since last July. Clinton is also more trusted than Trump on many issues voters rank as critically important, with one big exception. By a 50% to 45% margin, voters say Trump would do a better job handling the economy than Clinton would."

Source:
×