Alabama Wine Regulators Were Taken Over By Special Interests

Posted by Tom Wark on Sep 30, 2021

Not long ago I wrote about the corrupt circumstances of “Regulatory Capture”. In that article, Regulatory Capture was described this way:

“Regulatory capture is an economic theory that says regulatory agencies may come to be dominated by the industries or interests they are charged with regulating. The result is that an agency, charged with acting in the public interest, instead acts in ways that benefit incumbent firms in the industry it is supposed to be regulating.”

It’s never difficult to find examples of this sort of thing, particularly in the alcohol industry. However, it is unusual to see a regulatory come right out and declare they have been ceded their authority to industry actors the way Mac Gipson, administrator of the Alabama Alcoholic Beverage Control Board, recently did in an article concerning Alabama’s recently passed alcohol delivery bill:

In commenting on the various restrictions in SB 126 that legalized delivery of wine, beer and spirits locally, Gibson says:

“Frankly, we did not want out-of-state retailers competing with in-state retailers.”

It’s important to appreciate just who Mac Gibson is to understand the corruption here. Gibson is the chief administrator of the Alabama Alcoholic Beverage Control Board, which oversees all alcohol regulations, licensing and liquor sales in the state. His job is to implement the laws of the state as passed by the Alabama legislature. The mission of his agency is this: “to protect and support the public’s health, safety, and welfare by regulating the distribution, import, manufacture, and sale of alcoholic beverages demonstrated by professionalism, integrity, education, and transparency.” Nowhere in the stated mission of the Alabama Alcoholic Beverage Control Board does it say that the board shall protect licensees from competition.

Yet, here is Mr. Gibson working on behalf of the state’s retailers to protect them from competition. This only happens when his agency has been “captured” by the very entities he is supposed to be regulating.

Earlier this year, in May, Administrator Gibson failed to mention his work to protect private businesses from competition in an article he wrote for the Alabama Daily News in which he attempted to explain the difference between the state wine shipping law and local alcohol delivery law. In that article Gibson writes:

“I must point out that the ABC Board does not take a political position on the wisdom of these bills. In our regulatory capacity, our primary concern is to ensure there are adequate and enforceable safeguards in place to protect public safety and public health, including keeping alcohol out of the hands of those under age 21 and those who are already intoxicated.”

In this earnest declaration of the ABC Board’s lack of political involvement, he fails to add that part of what he and his Board do is protect private interests from competition. That’s political. That’s putting your fingers on the scale. That is advancing an agenda that sits well outside the mission of the ABC board.

I can’t say if the industry capture of the Alabama Alcoholic Beverage Control Board happened slowly over time or if it happened when Mr. Gibson came to work there in 2011. However, I do know that when an entire ABC board has been captured by and is in the control of the folks that it is tasked with regulating, it is the consumer that is harmed. Gibson’s attempt to protect Alabama retailers from competition from out-of-state retailers means consumers in that state will only have access to the very pitiful collection of wines that are brought into the state. This is bad for the Alabama wine industry, for the state’s consumers and for the integrity of and reputation of the Alcoholic Beverage Control board run by Mr. Gibson.