Wine & Spirits Wholesalers Lie For Profit — Again

My position is a simple one: 

When you publicly lie to consumers and lawmakers in pursuit of profit and at the expense of consumers and competitors, you should be publicly branded a liar.

Case in point: The Wine & Spirit Wholesalers of America, The Wine & Spirit Wholesalers of California, and the Teamsters.

Each of these liars is telling lies about California Senate Bill 620, legislation that would legalize direct-to-consumer shipments of spirits from distillers in California. Or, put another way: SB 620 would no longer require distillers in California or elsewhere to give away half their profits to wholesalers in order for consumers to buy their whisky, gin, rum, and other craft spirits.

Tomorrow, the California Senate Government Organizations Committee will hold a hearing and presumably vote on whether to advance SB 620 for a vote of the full Senate. If the committee does not vote in favor of the bill, the chances for California consumers to finally have real access to the explosion of craft spirits will die. Because make no mistake…the selection of craft spirits that are distributed by California wholesalers to the state’s retailers is pitiful.

In a last-minute desperate move to kill the chances of direct-to-consumer shipment of spirits to Californians, the Wine & Spirit Wholesalers of California, in league with the Wine & Spirit Wholesalers of America and the Teamsters have launched an effort to motivate consumers to write to members of the Government Organization committee urging them to kill spirits direct shipping. No one is going to use the system set up by these wholesalers to write to committee members except family members of wholesalers and teamsters. The reason is, no consumers support the current system of distribution that restricts access to legal products delivered in a proven safe and effective manner.

Still, I urge you to take a look at the lies that are being rolled out by wholesalers in the service of restricting free trade and expanded access to craft spirits:




The primary claims being made by the lying wholesalers and teamsters can be found in this document and are specifically these:

Moving to an interstate DTC model for distilled spirits will:

-Decrease revenues to the state by causing difficulties in tax collection.
This is a lie. In fact, Direct to consumer shipments of wine has in no way decreased state revenue derived from wine sales. Neither will direct shipment of spirits. In fact, it’s more likely that CA will see increased tax revenue as a result of direct shipping of spirits.

-Eliminate jobs. Alcohol beverage taxes are paid for by wholesalers and under a DTC system, wholesalers are bypassed, leading to a loss of up to 5,000 jobs.
This is a lie. In fact, the wholesalers have absolutely nothing to substantiate this claim of lost jobs and this is why they offer nothing in the way of proof. Not a single job loss has been documented as a result of winery direct to consumers shipping and there is no reason to think that wholesalers or retailers will need to lay off any employees if a consumer can buy and have shipped to them a bottle of craft spirits.

Overwhelm the existing regulatory system, adding major costs to the state for compliance and enforcement.
This is a lie. Given the fact there are far more wineries than distillers in America you would expect that direct shipment of wine would have overwhelmed the existing regulatory structure already. It hasn’t.

Increase the unregulated market and lead to growth in the underground economy. According to a 2019 national survey by the Center of Alcohol Policy, 86% of respondents agree that alcohol is a product that needs to be regulated, and 82% agree that alcohol is different than other products and should be regulated differently.
This is a lie. In fact, SB 620 throws up numerous NEW REGULATIONS to support the safe and efficient direct shipment of spirits to Californians. This includes regular reports on who shipped what spirit to whom. It includes distillers obtaining permits to ship. It includes the remittance of both sales and excise taxes to the state. And let’s not forget, the “Center for Alcohol Policy” is funded by wholesalers.

Undercut legal, compliant, in-state businesses that make up local communities.
This is a big lie. In fact, if passed SB 620 will HELP local businesses, particularly California distillers. The Wholesalers want you to think that this bill only helps big, out-of-state distillers, but in fact, the bill is written primarily to help California distillers, who will benefit significantly from direct shipping.

The important question isn’t why are these wholesalers lying. Lying is what wholesalers do for a living, particularly when it comes to questions of direct shipping. The real reason the wholesalers are making such a push on SB 620 is that in California a distiller, no matter their size, may only see their products sold to CA consumers if they sell the product out of their tasting room (where the consumer may only walk out with the product and not have it shipped to themselves) or by selling their spirits to wholesalers who then sell it to retailers.

This last item is important. If a California distiller can’t get a wholesaler to represent its brand and products and to sell it to retailers where consumers can find it, then there is no other way for a distiller to get on the shelves of a retail outlet. The wholesalers’ lies on SB 620 are in the service of keeping a stranglehold on California distillers.

Here is the truth: Consumers in every state ought to have the right to purchase and have shipped to them any legal beer, wine, or spirit they want from any producer or retailer. The onlyt possible reason to oppose this truth is if you oppose free trade, oppose consumer rights and want to line your own pockets, and don’t care about the impact on others.

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3 Responses

  1. Tone Kelly - January 10, 2022

    It is getting to the point that one easily tell when the wholesalers are lying— their lips move!!

  2. Bill St. Croix - January 12, 2022

    Far to honest and logical, Tom. The unfortunate reality is that the politicians pockets continue to be lined by these groups and that will continue to throw logic and consumers rights, out the window. It’s sad, but it’s the reality we face.

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