Today, more than 12,000 U.S. wine shops have a presence on the web. But just 14 states allow consumers to order wine from out-of-state retailers.
Eleven states prohibit residents from ordering wine from out-of-state wineries. Four states ban the sale of wine on Sundays. The overwhelming majority of Americans support supermarket wine sales, but 15 states force consumers to purchase their wine in a dedicated liquor store. In another 15 states, it’s illegal to bring your own bottle of wine into a restaurant — even if the restaurant owner is okay with it. Like virtually all America’s liquor laws, these restrictions trace their origins to Prohibition. Today, these laws simply harm consumers and enrich special interests.
Fortunately, there’s a new organization that’s fighting these anti-consumer wine laws. Called the American Wine Consumer Coalition, the group deserves every wine lover’s support.
When Prohibition was repealed 80 years ago, states were given the authority to regulate the “transportation or importation” of liquor within their borders. At the insistence of a motley crew of interest groups, states imposed an assortment of rules.
A top priority was weakening producers, because before prohibition, teetotalers and law enforcement alike believed they wielded too much power. Temperance advocates blamed producers for the ills of drunkenness; police officers associated producers with organized crime.
Lawmakers answered this call in one of two ways. They either took control of the sale and/or distribution of alcohol or created a “wholesaler tier” to sit between producers and retailers.
Today, just Pennsylvania and Utah maintain total control on alcohol sales. In those two states, government officials decide which liquor brands are sold, how much is charged, and where those products can be purchased.
Virtually every other state depends on a wholesale tier through which most alcohol must pass. This is essentially a state-mandated middleman.
As one might guess, wholesaling is big business. Together, the nation’s two largest wholesalers had revenues of more than $14 billion last year. So it’s no surprise that the wholesaling industry fights hard against efforts to undermine its presence.
Consider direct-to-consumer wine sales.
About 20 years ago, Americans started developing a taste for high-end wines, typically from California. Many consumers started ordering directly from producers.
Such transactions cut out wholesalers, so they spearheaded a campaign to prohibit winery-to-consumer shipping. Consumers responded with lawsuits, and in 2005, the Supreme Court ruled that state lawmakers could only prohibit direct shipping from out-of-state wineries if they blocked wineries in their states from shipping out of state. The 11 states that still prohibit direct-to-consumer wine sales hardly produce any wine of their own.
The wholesaling industry has also fought to block online retailer-to-consumer wine sales — and remains successful in 36 states. So if you live in Pennsylvania and desperately want a bottle of wine that can only be found at a store in Washington, D.C., you’re out of luck.
Wine retailers obstruct supermarket wine sales. After all, if consumers could pick up a bottle of Merlot while shopping for dinner, they might skip the trip to the liquor store. And while bans on Sunday sales were originally promoted to keep the Sabbath holy, they’re now pushed by retailers who hate the thought of increased competition.
Laws against bringing your own bottle of wine into a restaurant are pushed by the restaurant lobby. The reason? Restaurants profit handsomely from wine sales, typically tripling the retail price. Plus, it’s easy to imagine an upstart restaurant gaining traction by encouraging patrons to bring in their own booze — and established restaurants don’t enjoy competition.
America’s liquor laws are designed to protect and serve special interests — not consumers. That’s why the time has come for the American Wine Consumer Coalition.