The John Lennon School of Wine Politics—IMAGINE!

ImagineOne would have to admit to experiencing a spell of brute naïveté to imagine, even for brief moment, that the business and politics of wine might be organized around something other than a powerful, moneyed, manipulative class of interests. Reason, reality and history blunt that idea.

So, let’s not think it.

Instead, let’s imagine a business and politics of wine organized around a different powerful, moneyed, manipulative class of interests than currently dominates the wine marketplace.

Let’s imagine the consumer, instead of producers, retailers and wholesalers, wielding the power and the money in wine and doing the manipulating of the marketplace.

The same authority that organizes and regulates the current marketplace structure for wine would necessarily create the basis for this imaginary world in which the consumer, rather than the trade, is in charge of the wine marketplace: That is, the state and its regulatory levers. But to fully understand how this now-imaginary wine marketplace might be put in place, it’s required that we understand how the current system of regulating and governing the alcohol market came into being.

The simple premises that still govern the structure of today’s regulated marketplace in wine were set in place more than 80 years ago when national Prohibition—an historic failure to understand the fundamental nature of the American character—was coming to an end. The challenge then for social scientists and policymakers was to devise an alcohol regulatory system that could mitigate the ill effects of alcohol over-consumption as well as the corrupting force that resultS when vices need a vendor.

Put another way, policy makers in every state determined that the goals of a post-Prohibition marketplace in alcohol must 1) promote the temperate use of alcohol rather than its abuse and 2) prevent the natural tendency of profit-motivated vendors (criminal or legitimate) to pursue sales strategies that might undercut the first goal.

Because the pursuit of the first goal required the success of the second, nearly every single state choose to focus its post-Prohibition regulatory system on the vendors of alcohol: producers, wholesalers and retailers. Notice who is missing here. The consumer. But we’ll get back them.

First, let’s consider the world as it was when policymakers of the 1930s went about trying to devise a way to create a marketplace that could mitigate the evil of the temptation toward intemperance.

Beer and spirits were the national drinks, while wine was really little more than something certain ethnic groups indulged in to any degree. Most brands of alcohol were locally or regionally distributed. Transportation of goods was slow, undertaken primarily by a system of rails and ships. There was no comprehensive system of highways to allow efficient ground transportation of goods, let alone overnight delivery of goods beyond a few miles from their source. Information about wine was distributed via a slim number of books and through local retailers. Advertising of wine products was localized, not national. California wine, to the extent that it was thought about at all, was considered to be a source of sweet, Port-like creations. French, German and Italian wine was the standard. Compared to the ongoing flood of hundreds of thousands of wines now in the American marketplace, the number of wines sold in America following repeal of Prohibition was miniscule.

Equally important, these policymakers lived in a social environment that had just witnessed 14 years of brash and unconcealed criminal activity born of the ban on alcohol consumption in a country of people that had no intention of stopping their alcohol consumption. They had just witnessed the futility and expense of governments committing millions of man-hours to policing the thugs, criminals and famous masterminds that took advantage of Prohibition—and all to no avail. They also remember the pre-Prohibition days when families and urban areas were pockmarked by the disaster of alcohol abuse and abusive marketing of alcohol to the abusers.

To put it fairly, the policymakers who crafted the regulatory structure of an immediate post-Prohibition wine marketplace could no more imagine the economic or social structure of the 21st century than they could imagine a 25th century economic and social order. This is not their fault. As the adage goes, generals always prepare to fight the previous war. The post-Prohibition policymakers went about preparing to fight the previous conditions underlying alcohol abuse.

What they learned from their immediate experiences was that attempting to regulate the behavior of the individual didn’t work when the vice of intemperance was at issue. The response was to regulate the behavior of the business that produced, delivered and sold the vice.

Between 1933 and 1935 the various states all went about creating alcohol regulatory structures that had the primary impact of determining who could sell wine, how wine could be sold, where wine could be sold, what wine could be sold, in what quantity wine could be sold, who could produce wine, who could distribute wine, how wine could be distributed, in what format it could be produced and distributed, and the price that producers, distributors and vendors of wine would have to pay in the form of taxes and fees for the privilege of producing, distributing and selling wine.

The goal of these regulations was to assure as much as possible that the profit motive driving the producers, distributors and sellers of wine would not corrupt the primary goal of promoting temperance among the drinkers (consumers) of wine.

And so it was that the goals underlying the then and now system of alcohol regulation were pursued by focusing legislative and regulatory efforts on the alcohol industry. It should be no surprise that in turn the focus of those being regulated—the producers, distributors and sellers of wine—would be the regulators and the lawmakers making the policies that regulated their actions. The goal of the trade was quite different: create the most favorable conditions as possible for the profitable sale and distribution of wine.

Note now something very important: that the interests of the consumer—access to wine and convenience in accessing wine—was not a primary goal of either the regulators or the producers, distributors or sellers of wine.

In the ensuing 80 years since the creation of the post-Prohibition alcohol regulatory systems and since the memory of Prohibition’s abuses and the abuse of the marketplace in pre-Prohibition era has faded, the alcohol trade has won the battle for domination and control of the regulatory system. The regulators and regulations have become the tools of industry, rather than the tools of temperance.

In the interest of commerce rather than temperance, the States and their regulatory apparatus been pushed to work with producers, distributors and vendors to create and maintain a government regulated marketplace for wine that is gamed to keep archaic, 1930s distribution and sales mechanisms in place that protect profits in the way that inertia protects against deviation.

Interestingly, the very people who provided the intellectual foundation for the post-Prohibition regulatory framework predicted this industry domination of the state regulatory regimes.

In 1933, Raymond Fosdick and Albert Scott published a little study entitled, “Toward Liquor Control”. According to Daniel Okrent, author of the bestselling “Last Call: The Rise and Fall of Prohibition”, this study in how to re-regulate alcohol after repeal of Prohibition “was one of the key documents influencing how the nation would deal with alcoholic beverages going forward.”

“Toward Liquor Control” was the primary document that imagined, outlined and gave authoritative voice to the state licensing and regulatory schemes that most states adopted. But in describing this new system of liquor control, authors Fosdick and Scott warned of the following:

“The establishment of a licensed-liquor trade means the deep entrenchment of a far-flung proprietary interest. This interest would have a large capital investment to be protected at all costs. Buildings, leases, fixtures, inventories, stocks and bonds—representing millions of dollars—would require defense against those who in the public interest might threaten curb or reduction…Moreover, such a vested interest is bound to employ aggressive tactics in its own defense. Liquor trade associations, open and disguised, would continuously oppose every restriction of opportunities to sell.”

And this is exactly what has happened.

Today, the trade associations of alcohol distributors and wholesalers as well as the companies that provide membership to these associations invest millions of dollars annually in campaign contributions to assure that lawmakers don’t fiddle too much with the archaic laws that originally set them up in business and that eventually came to be embraced by the trade as protections from change and competition.

And so today, 80 years after the end of Prohibition, when wine has become a national pastime and when consumers have embraced the tools of information to govern the ways in which nearly every other product is sold, we still have the business and politics of wine organized around a powerful, moneyed, manipulative class of interests that have avoided the influence of the consumer.

And so, it is time to ask the question again: What if a different powerful, moneyed, manipulative class of interests dominated the wine marketplace. What if the consumer, instead of producers, retailers and wholesalers, wielded the power and the money to control and manipulate the marketplace in wine toward their own interests?

The thing is, they do.

This is where the idea of a formal organization of wine consumers comes in. This is where the idea that the voice of the consumer, spoken loudly and in unison, can overwhelm the unchallenged influence wielded by groups that have proven over and over again they have no concern for the interests of wine consumers.

And what are those interests?

1. The promotion of moderate and responsible consumption of wine
2. Free and legal access to any wines sold in the American marketplace
3. Convenience of access to wine without arbitrary restrictions on where wine can be purchased.
4. Control of consumers private inventory of wine

In practice, what does this mean? It ought to mean that wine consumers are not burdened by state based restrictions on the importation of wines they purchase in other states. It ought to mean that the convenience of buying wine in the most obvious places (such as grocery stores) is not restricted. It ought to mean that a free market in wine is cultivated so that the benefits of that economic philosophy might accrue to consumers in the form of greater local selection, better prices and alternatives to local purchasing. It ought to mean a system of laws that punish those who inflict harm on others or put themselves in a position likely to result in harm of others while under the influence of abusive consumption.  It ought to mean the imposition of an alcohol tax structure sufficient to promote moderate consumption and the funding of the regulatory apparatus.

Despite the reasonableness of this outline of interests, it comes nowhere near to matching the legal and regulatory system that currently exists under the influence of the trade and their compatriot lawmakers. Restrictions abound in every state on allowing consumers to access the wines they want, on interstate delivery of wine, on the convenient local access to wines and on the embrace of a free market approach to the wine marketplace.

The only question that remains for wine consumers is what levers of power they retain that would allow them to rest control of the alcohol regulatory system from the forces currently dismiss the consumers’ interests? The answer is obvious: Money and Votes.

It should be lost on no one, particularly the wine trade, the regulatory community and lawmakers, that without the consumer, there is no wine industry, no system to manipulate and no taxes to collect. Consumers banding together to pool their resources in any effort to reform the current system by which they pursue their love of wine will produce millions of dollars to devote to a campaign of reform. In 2012 American wine consumer spent $34 Billion on wine. One half of one percent of that total is $170 million. With just one-tenth of this amount devoted to politicking, communications and lobbying, consumers would see restrictive laws fall in a number of states.

Then there are votes. Votes are voice. To this point, lawmakers and regulators have become accustomed to hearing only a tiny few voices whispering wishes and desires in their ears. The whisperers have been the trade. But imagine if a coalition thousands or tens of thousands consumers started doing the whispering; better yet, doing the talking at every opportunity where the lawmakers and regulators gathered to determine the future of consumer access to wine.

Imagine 100 consumers showing up for government hearings on laws concerning the consumer access to wine. Imagine 1,000 consumers in a state gathering on the steps of a capital to recite their grievances. Imagine 10,000 wine consumers in a state issuing emails, letters and phone calls to their representatives urging they vote to advance consumer rights. The impact would be a tidal wave of pro-consumer reforms.

The first step toward consumer control of the wine marketplace is not collective. It is individual. It is the decision of individual wine lovers and wine consumers to join a movement to advance their rights. It is the decision taken by wine lovers across the country, on their own, to join with wine lovers in other states to create a coalition that can voice their interests. Then, when this national coalition of consumers is so large as to dispel the belief among the current owners of the regulatory system that consumers won’t make any noise, that’s when voices get raised and the regulatory system that disregards consumer interests is reformed and placed under new ownership.



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