What would you think H.R. 5034, the CARE Act of 2010, pertains to? Health care, perhaps? Wounded veterans? Nursing homes?
Nope. The Comprehensive Alcohol Regulatory Effectiveness Act of 2010 deals with who gets the money for putting wine, beer and spirits into the stores where you buy it. The CARE Act seeks to make sure it will it continue to be beer, wine and liquor wholesalers, who since the end of Prohibition generally have been the middlemen in a three-tiered system of manufacturers, wholesalers and retailers.
Or will producers be allowed to chip away at the process? Anheuser-Busch InBev and SAB Miller, which control 80 percent of the beer market in the United States, are trying to consolidate distributorships and mounting expensive legal challenges to existing state liquor control laws.
This bill pits one well-funded interest group against another. Breweries and wineries argue that eliminating the middleman will make their products cheaper. The wholesalers warn that the secret agenda of the alcoholic beverage industry — in league with mega-retailers like Costco and Wal-Mart — is to “deregulate” alcohol by gutting the power of state liquor laws.
The CARE bill is a case study of your Congress at work. It still hasn’t been heard by the Judiciary subcommittee to which it was assigned, and hasn’t popped up very high on the public radar screen.
But out of public view, the two sides are working it hard. Billions of dollars and the future of an entire industry — wine and beer wholesaling — depend on it. You’d like to think that the bill would be decided on its merits — where does the public good lie? But the winner probably will be the side that spends the most money cultivating support.
There are some potential problems with that.
On Aug. 2, The Washington Post reported some amazing coincidences. The CARE Act was introduced on April 15 by Rep. Bill Delahunt, D-Mass., and referred to the House Judiciary Committee.
Over the next two weeks, the National Beer Wholesalers Association contributed $45,000 to the various campaign committees of Judiciary Committee Chairman John Conyers Jr., D-Mich. The wholesalers group also hired Julian Epstein, Mr. Conyers’ former chief of staff, to help run strategy.
The Post reported that the wholesalers group also has donated nearly $300,000 to more than 100 other House members, Democrats and Republicans alike, who agreed to co-sponsor the CARE Act, often within days of their agreements to sign on as co-sponsors.
Because each congressional district has at least one, and often several, liquor, beer and wine distributorships, wholesalers are a very powerful lobby. In the 2010 election cycle, the association has contributed $2.2 million to federal candidates and parties, according to the authoritative Center for Responsive Politics. The Wine and Spirits Wholesalers of America have contributed another $634,000.
But breweries, wineries and distillers are no slouches themselves. A-B InBev has contributed $626,650 all by itself to federal candidates and parties this year, according to CRP. Molson Coors, SAB Miller, Gallo Winery and other familiar names also are major contributors.
On other issues, producers and wholesalers often lobby on the same side. But this time two very powerful lobbies are going head-to-head.
Effective liquor control laws are important. Fostering competition in an increasingly concentrated industry is important. This issue should be decided on the merits, not the money.
