Albany courtesy Ryan Mori
When it comes to regulations, special interest is never “at rest”.
Recently there has been a lot of discussion about regulations in reference to the US economy. The logic is that regulations in just about any form hurt business, reduce jobs, and cost the nation dearly as a result. Now the reality is that Capitalism without any regulation doesn’t work very well. Corporations are in the business of building wealth for their shareholders (and in so doing often build tremendous wealth for their corporate managers).
Now … nothing wrong here – that’s what Capitalism is all about. However, if there is no regulation at all than the focus on wealth becomes the driving force to the exclusion of responsible citizenship; that is, anything goes just as long as the company is optimising profits. There are numerous examples of corporate greed that cause enourmous harm from the catastrophe in the New York garment industry in 1911 to the recent banking fiasco that contributed to a worldwide recession.
So you would think that government would focus on strong regulations where certain protections for the public are warranted, but do their best to eliminate regulations where they are not needed.
OK…. someone help me here! If regulations are so detrimental to our nation, why do lawmakers in Washington, D.C. and in the States continue to avoid regulations that are needed (one example: the current rush to drill for natural gas called “fracking” is exempt from the Clean Air and Clean Water Acts – it may be safe, but how can we know if no one is watching out for the general public?), while focusing on special interest legislation that is not?
I have written before regarding Bills HR 1161 as well as its predessor, HR 5034. Both bills are backed by special interests in an effort to reverse past Supreme Court rulings that pit the Interstate Commerce Clause against a State’s ability to discriminate between in and out of state alcohol interests. Here supporters of 3-tiered distribution are working hard to ensure that the monopoly they have enjoyed since the 21ist Amendment was passed continues.
In this blog I’d like to highlight a new special interest effort in the State of New York called “at rest“. First some background.
The New York City is currently served by two major wine distributors and dozens of smaller distributors. The major distributors warehouse their wine inventory in New York. The smaller distributors typcially warehouse the wine in New Jersey where the cost of storage is cheaper. Irrespective of where the wine is held, it is available for immediate purchase and delivery to New York customers. Because there are numerous distributors in the area, New York enjoys a much larger choice in the wines it purchases and can do so at better pricing. You know … that element in Capitalism called competition?
So how best to reduce competition? Simply have the large distributors use their influence to get law makers to change the playing field. How you may ask? Elementary … by requiring all wine sold in New York City to be warehoused in New York for a minimum of 48 hours. Yes … you guessed it! The major distributors can comply but all of the smaller distributors will not be able to sell their wares – many will no longer be able to service New York.
Well you say that there must be benefit to the citizens or the State of New York, right? No .. this change will not have any beneficial effect on the citizens of New York. Actually it will likely result in price increases, less choice, and loss of jobs. However, it will setup a great monopoly for the two largest distributors!
If you are a citizen of New York I urge you to sign a petition saying no to “at rest”.
To read more about this special interest wine legislation, visit Jancis Robinson.com and read “Protest against NY’s ‘at rest’ move”.
And while your at it … let’s all focus on getting money out of politics. Its time our lawmakers focused on building a strong nation instead of supporting the will of those that finance elections.
There are many great wine blogs on the net. One of my favorites is Dr. Vino. Tyler Coleman not only holds a Ph.D., he is also the author of several books, and very importantly, his blog often delves in some rather contraversial subjects. Case in point, his recent blog entitled “Wine Shops in states with supermarket sales – three views”, in which he has initiated a rather, some times stormy “conversation” between various intersted parties regarding allowing sales of wine in grocery stores in the State of New York.
This is a fairly heated issue at the moment. Here’s a view on the subject from the retailers perspective from the Queens Chronicle – Liquor Store Owners Face Grocery Clash.
This actually is a second attempt to allow wine sales in grocery stores after a first attempt failed about a year ago.
What’s at issue?
There are actually five competing perspectives on the matter:
1. The State of New York wants to increase revenues
2. Grocery stores want to sell wine to increase sales
3. New York State wineries would like to see more shelves dedicated to selling their wines
4. Consumers would like to be able to shop in one place for their food and wine
5. Current liquor stores want to keep the status quo, and/or are concerned over what this might do to their business.
All the markings of a great debate! As of 2/12 at 12:28 there were about 71 responses. Now this does not reflect 71 individuals. Rather, it represents a much smaller number of people who are either dead set for or dead set against the enactment of this law. (The count is up to 77 as of 2/20)
As I peruse the responses, it is clear that there are passionate arguments for and against enactment. The current store owners do have reasonable concerns particularly where current law includes many restrictions on their business. Namely, dozens of laws enacted before and after Prohibition that likely make little sense in 2010. On the other side are those that are passionate about changing things for the better (their perception) and are arguing strongly in favor of moving away from the laws set as a result of the lifting of Prohibition in 1933 to more reflect the realities of 2010.
Debate is good. No one is completely right or wrong, even if some of the arguments are either protectionist, in error, or simply self serving.
Tempus fugit. Some laws are timeless, but many need review and change over time. For instance, there is a law in Massachusetts that does not allow financial support to parochial schools. Now, I do believe in a separation of church and state. However, the reason for this law goes back to the 1900s when a group (Know Nothing Party) were determined to do whatever needed to stymie those emigrating from Ireland. There is debate now that the law is getting in the way of providing children a better education.
So laws do need to be reviewed, and lively debate is needed to ensure the best results are achieved. Business also must evolve. It wasn’t that long ago that General Motors fought for years against regulations that required safety glass in cars, only to find the Japanese and others investing in engineering instead of lawyers. Times change and require laws and businesses to adapt.
I simply can’t help believe that if each of the concerned parties took a position that said “let’s make things better for the citizens of New York”, a compromise could be identified that:
- Helped increase revenues for the State of NY
- Allowed consumers to do one stop shopping
- Allowed grocery stores to sell wine
- Increased the shelf space dedicated to wines produced in the State of NY (3rd largest wine producing state)
- Changed or did away with laws that restrict current liquor store owners from evolving their business to exist profitably in spite of wines sales in grocery stores (where in 35 other states grocery stores and liquor seem to be able to co-exist)
The only thing I can hope for is that after pondering the stupidity and inability of our current legislative bodies in Washington to work together for the betterment of the American people, that the interested parties in the State of New York will reflect on what is before them, see this as an opportunity – not a win or lose situation – and act responsibly for the sake of all concerned.
OK .. with that said, don’t forget to bookmark Dr. Vino. Kimchi anyone?