Be Careful What They Wish For:
Brewers & Government Restrictions

With a slew of bills, the Michigan Legislature is moving slightly in the direction of more freedom for beer drinkers. But, with the backing of some Michigan brewers, the Senate voted to codify ridiculous rules that try to pick winners and losers in the marketplace.

When politicians are considering a bill that would criminalize bars and restaurants receiving products with logos on them, it is easy to understand the cynicism of politics.

For example, a Michigan Liquor Control Commission rule from the Prohibition Era prevents bars and restaurants from having glasses or napkins with logos on them. The MLCC is repealing the rule, but Senate Bill 505 — which passed the Senate and now sits in the House — ensures that alcohol manufacturers, sellers and distributors could not give bars and restaurants items that promote their brands. The bill is causing a hang-up since it is “tie-barred” to other legislation — meaning all or none become law — and many House members are not ready to accept the restrictions.

The Michigan Beer and Wine Wholesalers Association, which represents many craft brewers, supports the rule. The group believes competing manufacturers could provide free items, possibly in exchange for prime tap space, and crowd out craft brewers.

Here’s why that’s silly: if people weren’t able to freely enter into whatever types of agreements they wanted, Sam’s Club couldn’t offer free samples of food from manufacturers’ products; diners couldn’t develop brand loyalty to Pepsi or Coca Cola; stores couldn’t offer coupons for certain products and no one would get free merchandise on New Year’s Eve.

If craft brewers want to work out their own deals, they should do so. That’s how competition in the marketplace works, and it means cheaper and better products for consumers.

Michigan has the strongest prohibitions on logoed items in the nation, which upsets some restaurants and bars.

“Apparently free market principles and the elimination of frivolous government intrusion are no longer priorities of Senate Republicans,” Brian DeBano, president and CEO of the Michigan Restaurant Association, told the AP. “I will be sure to consult with the caucus the next time my members want to change ketchup brands to make sure they approve.”

It’s particularly disappointing to see the beer and wine wholesalers association working for select restrictions on their competitors, considering they have long been the losers in Michigan’s complicated and unnecessary alcohol regulation regime.

Brewers and establishments of all sizes should be aware of one of former Mackinac Center President Larry Reed’s Seven Principles of Sound Public Policy: “[A] government that’s big enough to give you everything you want is big enough to take away everything you’ve got.”