I recently had the good fortune of being interviewed by ReasonTV on the subject of laws that harm wine consumers. In the brief interview, I outline many of the ways in which various state laws, supported by various actors in the wine industry, harm consumer choice and consumer access to wines.
However, what I did not do is address the most common ways these laws are defended and justified by those that benefit from them. In the interest of thoroughness, I want to outline a few of those justifications and address them as succinctly as possible.
1. The state-mandated use of a wholesaler promotes competition in the wine market.
HOGWASH. IT DIMINISHES COMPETITION
2. The state-mandated three-tier system prevents producers from dominating a market as they did prior to Prohibition.
HOGWASH. THE STATE-MANDATED SEPARATION OF THE TIERS DOES NOTHING TO PREVENT VERTICAL INTEGRATION AND NEVER HAS.
3. State-mandated use of a wholesaler assures tainted products can be easily detected and pulled from the market.
HOGWASH. PAPER TRAILS CAN EASILY BE KEPT INTACT WITHOUT OR WITHOUT WHOLESALER INVOLVEMENT.
4. The three-tier system is responsible for the explosion of craft and artisan products available in the marketplace today.
HOGWASH. PRODUCERS AND CONSUMERS ARE RESPONSIBLE FOR THE PROLIFERATION OF PRODUCTS. WHOLESALERS ARE NOTHING MORE THAN BOX DELIVERY PEOPLE
5. Direct shipment of wine from retailers and producers to the consumer threatens the three-tier system.
HOGWASH. IT ONLY THREATENS THE ILLEGITIMATE PROTECTION WHOLESALERS HAVE BOUGHT AND PAID FOR
The best advice I can give anyone who wants to understand the debate over the three-tier system is this: Never believe a word a wholesaler or wholesalers’ representatives say when they address the utility of the three-tier system or anything having to do with what’s good or what’s bad for consumers. It’s HOGWASH.