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Jay R. Brooks on Beer

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If Bud Tasted Like Goose Island Honkers Ale

May 21, 2009 By Jay Brooks

The following video was sent to me by a Bulletin reader and fellow blogger (thanks Dave). He writes at Deadpan, Inc., where he creates and produces lots of videos like this one on a variety of topics. It’s pretty funny, I imagine especially so for brewers Will and Greg at Goose Island Brewing.
 

 
I spoke to a friend I know on the inside at A-B who told me it’s actually only weekly that these tastings are done. It’s known as the “Corporate Taste Panel” and is apparently a huge deal for the individual breweries who are essentially pitted against one another. How well a specific location’s beer does effects employee promotions and raises. He told me it can’t be overstated how important these tastings are. Each quarter one brewery is awarded the “Brewmaster’s Cup” based primarily on how well their Bud and Bud Light did in these taste panels. The scores are tabulated using only the group known as the “Key Tasters,” which consists of the VP of Brewing and roughly another half dozen members of the Brewing Senior Management Group. Brands other than the two flagships are tasted by a different group on “Junior Panels.” It is so important that after the “weekly standard package” tasting, brewery employees usually stay well past quitting time to learn the results of the tastings.

That’s an interesting peek into the corporate culture at Anheuser-Busch. Given that their goal is to produce products that taste the same regardless of where they’re made, it certainly seems like this would be an effective way to do that. Still, that video made me laugh out loud.

 

Filed Under: Uncategorized Tagged With: Video

Dismissing Beer

May 20, 2009 By Jay Brooks

The SFoodie, Tamara Palmer, at SF Weekly just released her choices for the 10 Coolest Specialty Food and Drink Magazines. I have no real quibble with her choices, even considering I don’t know a number of the food magazines that made the list. Two publications that write about beer are there. The first, Imbibe, usually has something about beer in every issue though its focus is on all beverages. It came in at #3. The other one, DRAFT, is the only beer-only magazine to make the list, and it is #5. As I said, I have no quibble with either choice, a prety good showing for both rags. I’ve written for DRAFT, though not Imbibe (I have spoken to their editor about pitching something, but haven’t done anything about it yet).

Anyway, I should disclose that I’m probably overly sensitive about these sorts of things, but it definitely ruffles my feathers when other writers, and especially food or wine writers, write uncharitably about beer in somewhat dismissive tones, even when they’re trying not to, as if they can’t help themselves. That seems to be the case here, as Palmer writes in her description of DRAFT magazine. “Beer is not usually something you think of as classy.” Really, why was that qualification necessary? She lives in San Francisco, the birthplace of the modern craft beer movement. There are countless good beer bars, and most here have at least an okay selection that includes more than just the macros. Then there are more than a few restaurants starting to embrace beer. Slanted Door, Millennium, and, of course, the Cathedral Hill Hotel, to name just a few. And look at the great job 21st Amendment, Magnolia, Thirsty Bear and Alembic have done with their menus. How could a food writer miss entirely SF Beer Week? With 155 events over ten days, including over two dozen beer dinners and another 25 or so beer and food pairing events at such places as Oliveto and Chez Panisse, for chrissakes. Surely, she couldn’t have missed the giant beer tent at Slow Food Nation last August at Fort Mason. San Francisco isn’t just some podunk town when it comes to beer, but everywhere you look you see local and better craft and imported beers. So how do you inhabit that space and not be touched by it, dismissing it at the stroke of a pen. I find it just so incredibly frustrating. I see so many people committed to raising the status of beer beyond mere commodity, pouring their life’s blood into it to no apparent effect whatsoever. I mean what exactly do the craft beer brewers, the better beer bars, and the beer savvy chefs at restaurants embracing beer have to do to attract the notice of someone whose very job is about food and drinks?

In the end, Palmer does admit “Draft gives the craft its due as a refined art,” but then why was it so necessary to first dismiss beer as being perceived as unrefined. I understand that many people do see it that way, but haven’t we or can’t we move past that yet, especially among the class of people charged with telling people what are the best things to eat and drink and where one can have the best experiences doing both? I have. Most beer aficionados, wine makers, and a growing number of chefs have moved beyond such antiquated thinking. Why is parity so damn difficult? I think I’ve been working too much lately. I’m getting crabbier than usual, and for me that’s saying something. I need a nap.

 

Filed Under: Uncategorized Tagged With: Uncategorized

Stupid Is As Stupid Does

May 20, 2009 By Jay Brooks

Today, the Senate Finance Committee released a 41-page report entitled Financing Comprehensive Health Care Reform: Proposed Health System Savings and Revenue Options.

When looking it over, one can’t help being reminded of the aphorism so often spouted by Forest Gump in Winston Groom’s wonderful anti-war novel of the same name: “stupid is as stupid does.” Essentially it’s a variation of similar sayings stretching back to at least the 14th century, where “x’ is as “x” does. What it means is simply that appearances don’t matter as much as deed and actions. In the example “beauty is as beauty does” it means that a person blessed with good looks is not beautiful unless the person’s beautiful inside, that is their actions make them a beautiful person. In Groom’s aphorism, he means that if someone does something incredibly stupid, then they’re a stupid person. In the case of the novel, Groom was seemingly an idiot, but in reality his actions belied that impression. [For the record, the film sucked, but the book is a work of genius; wonderful language, a dark comedy with a strong antiwar message that was neutered by the feel good film.] In the case of the Senate’s stupid actions today, they’ve shown that appearing to do something is far more important than actually doing anything effective or meaningful. Again, as I wrote last week, it comes down to what’s the best strategy for staying in office.

So what might lead me to so emphatically call the U.S. Senate’s actions stupid? In their proposal they’re advising that the federal excise tax on beer, currently $18 per barrel, be raised to $45, nearly tripling it. This came out of suggestions made at the Senate round table which I discussed last week. Here’s the language of the proposal, which begins at page 34:

SECTION IV: Lifestyle Related Revenue Raisers

Impose a Uniform Alcohol Excise Tax

Current Law

An excise tax is imposed on all distilled spirits, wine, and beer produced in, or imported into, the United States. The tax liability legally comes into existence the moment the alcohol is produced or imported but payment of the tax is not required until a subsequent withdrawal or removal from the distillery, winery, brewery, or, in the case of an imported product, from customs custody or bond.

Both the tax rates and the volumetric measures on which the taxes are imposed differ depending on the type of beverage. Taxes are lower on the alcohol content of beer and still wines than on the alcohol content of distilled spirits and naturally sparkling wines. Distilled spirits, wine, and beer produced or imported into the United States are taxed at the
following rates per specified volumetric measure:

On a per ounce basis, distilled spirits are taxed at roughly 21 cents per ounce of alcohol, still wines at 8 cents per ounce of alcohol (assuming an average alcohol content of 11 percent), and beer at 10 cents per ounce of alcohol (assuming an average alcohol content of 4.5 percent).

Proposed Option

This policy option contemplates imposing a uniform tax based on the alcohol content contained in the product. The excise tax under the proposal is imposed at a rate of $16 per proof gallon on all alcoholic beverages.62

As under present law, domestic wineries having aggregate annual production not exceeding 250,000 gallons would be entitled to a tax credit on the first 100,000 gallons of wine (other than champagne and other sparkling wines) removed in a calendar year. In a manner similar to present law, for domestic brewers producing less than two million barrels of beer during the calendar year, the proposal imposes a reduced rate of tax on the first 60,000 barrels of beer removed each year.


56 A “proof gallon” is a U.S. liquid gallon of proof spirits, or the alcoholic equivalent thereof. Generally a proof gallon is a U.S. liquid gallon consisting of 50 percent alcohol. On lesser quantities, the tax is paid proportionately. Credits are allowed for wine content and flavors content of distilled spirits. Sec. 5010.

57 Small domestic wine producers (i.e., those producing not more than 250,000 wine gallons in a calendar year) are allowed a credit of $0.90 per wine gallon ($0.056 per wine gallon in the case of hard cider) on the first 100,000 wine gallons (other than champagne and other sparkling wines) removed. The credit is reduced by one percent for each 1,000 wine gallons produced in excess of 150,000 wine gallons per calendar year.

58 A “wine gallon” is a U.S. gallon of liquid measure equivalent to the volume of 231 cubic inches. On lesser quantities, the tax is paid proportionately.

59 Sec. 5001(a)(4).

60 A small domestic brewer (one who produces not more than 2 million barrels in a calendar year) is subject to a per barrel rate of $7.00 on the first 60,000 barrels produced in that year.

61 A “barrel” contains not more than 31 gallons, each gallon equivalent to the volume of 231 cubic inches. On lesser quantities, the tax is paid proportionately.

62 Because the rate of tax will not depend on the source of the alcohol, the section 5010 credit based on wine content and flavors content of distilled spirits is not necessary and would be eliminated under the proposal.

Because spirits would have its taxation changed the least, prices of wine and beer would skyrocket while liquor would remain almost the same. This would undoubtedly lead to increased sales for spirits and a disastrous sales drop off of wine, but especially beer, whose taxes would be raised the most.

The last time the federal excise tax on beer was raised, in 1991, when we in the midst of another recession, the economy bounced back but it took many years for the taxes collected on beer to return to the levels that were collected before 1991. And that was during the boom years of the Clinton administration, when we had a budget surplus. Remember those days? It makes a soiled dress seem positively quaint compared with what we’re facing today.

In Beer Business Daily’s newsletter this morning, “Jeff Becker of the Beer Institute points out that this increase would ‘threaten jobs, increase consumer costs for those least able to pay and jeopardize brewers, wholesalers, retailers, suppliers and related businesses that rely heavily on the beer industry. In 2008, members of the beer industry paid more than $41 billion in taxes at all levels of government and provided jobs to 1.9 million Americans. Any proposed tax increase would severely offset this important economic contribution.'”

And as Harry points out, even the Distilled Spirits Council of the United States (DISCUS), who in a sense has the most to gain (and has in the past supported tax equalization) should this proposal be enacted, is against it because “it would actually decrease tax revenue. ‘When the federal excise tax on spirits was raised in 1991,’ writes DISCUS, ‘tax revenues actually fell and it took 10 years before they regained their pre-1991 levels. If the tax revenue history is any guide, and the end result is hundreds of thousands more unemployed workers, you have to ask yourself what is the point?'”

Indeed, that is the question, what’s the point? Why would the Senate propose to essentially wipe out an industry to raise 0.008% of the funds needed for a $1.5 trillion health care initiative? Why would they ignore history? Why would they knowingly put forth a proposal that so obviously would lead to more unemployment, to a reduction in tax revenues (instead of raising more) and would regressively effect the poorest Americans.

I also have to laugh at the doublespeak of calling this “Lifestyle Related Revenue,” which is, one supposes, the new less politically charged way of calling it a sin tax. But it’s the same thing. If your “lifestyle” includes enjoying alcoholic beverages, then you will be punished with additional taxes, never mind that moderate consumption has been shown time and time again to have health benefits. You can’t call it lifestyle based, impose more taxation, and not have it have negative associations. It just sounds nicer, and confuses people into thinking it’s not as nasty as it is in reality.

I know this is just still a proposal, but last week we said it was just a round table and here we are only a few days later and now it’s a proposal. Who knows how fast this will move. Politicians tend to reflexively act in knee-jerk ways that give the appearance of action but with little thought to long term consequences. It’s how they — as Mel Brooks so eloquently put it in Blazing Saddles — protect their phony baloney jobs. And in this case, the long term consequences seem very dire indeed. There’s very little pay off, almost none really, and it seems obvious to anyone paying attention that the possibility of a chain reaction that would decimate the industry is very, very real. If that’s not just plain stupid, I don’t know what is.

 

Thanks again to Harry Schumacher and his Beer Business Daily. If you don’t already subscribe, and beer is your business, you should consider subscribing to Harry’s daily e-mail newsletter.

 

Filed Under: Uncategorized Tagged With: Uncategorized

Cap Dog Art

May 19, 2009 By Jay Brooks

Finally back after a day of being locked out of the Bulletin due to a combination of a weird glitch and slow customer support, and this fun piece of art just in from Sea Dog Brewing in Maine. Robert Cochrane, presumably a local artist, created a large piece of art depicting Barney, the Sea Dog logo and mascot, using only crowns, or bottle caps. Here are photos of it, which are posted on Sea Dog’s Facebook page. Apparently the original is at their newest location in South Portland, Maine. I’ve featured art here before using crowns, but never one done specifically for a brewery. Pretty cool.

 

Barney as Cap Dog.

Artist Robert Cochrane.

A close-up of the artwork.

 

Filed Under: Art & Beer

Beer In Art #28: Jos Van De Ven’s Still Life With Beer Bottle

May 17, 2009 By Jay Brooks

Today’s work of art, while thoroughly modern, is painted in a style reminiscent of the old masters by Dutch artist Jos Van De Ven. Van De Ven’s work featured today is entitled Still Life With Beer Bottle and Book.

 

The work is done in oil, and measures 61 x 46 cm, roughly 18 x 24 in. The artist himself describes the painting:

When I was in Lithuania, I found the little painting you can see on the wall in the background. It is a typical landscape of that area. The cup in the foreground is a Russian antique and the old handmade beer bottle is French. In order to see the shadows on the wall, I used a light background. Here again, I had to use a white cloth on the shelf in order to create a balance with the light wall.

So Van De Ven paints in the style of old Dutch masters, and here’s why:

Technique for the sake of technique and for showing off a kind of virtuosity may create some “wow”, but to my mind it has no real value. A painting has to be an illusion with a soul, not an exact replica of reality. Photography can do that much better.

That’s why I like the art of painting. The artist can create something, using reality as a tool, that a photographer may never be able to do. They can create their own light, mix colours that may not really exist, or forms that would be difficult to find in the real world. A painting is the product of an artist’s fantasy or imagination, giving them the opportunity to create their own universe. The artist can make a painting “come alive”.

As much as I enjoy painting classical still lifes, I strive to give them a contemporary touch. For instance, in the 17th century, the interior of houses were dark because of all the wood paneling on the walls and the small windows. That’s often reflected in the still lifes of the time, particularly in the dark brown colour schemes and sparse lighting. But I want my still lifes to he fresh, full of life and light, with vivid colours I want them to be alive, to show that simple things in life have a right to exist, too. As such, I use many of the best classical techniques but with a modern day spin.

And here’s a biography of the artist, from his website:

Jos Van De Ven is a modern artist with a classically inspired style who considers painting to be an adventure and a search for conceptual communication. Currently he likes to express a peaceful state of mind using objects in a timeless setting. At the heart of his work is the play and poetry of light and color. His work may be “still”, but it is alive.
“The richness of life lies within sincerity, elegance and a bit of mystery: I like my paintings to reflect states of being and my quest towards a better comprehension of man and his nobility, and that they open a window for those who know how to look beyond appearances”, says Jos Van De Ven.

His artistic journey has taken many twists and turns. In his younger days, he was devotee of the French Impressionists until he met Salvador Dali at his home in Spain. Jos was only 23 at the time. He continued with surrealism until he felt the need to break loose, painting in a totally abstract way, wild, uncontrolled, very colourful. Still not happy with his work, Jos studied art in Spain after which he felt revitalised. Unfortunately, due to various circumstances in his life at the time, he stopped painting for a while.

Years later, Jos picked up his paint brushes again, but did not know what to paint. He had changed and was looking for something that would allow him to express what he wanted say with his art. He became interested in the techniques of the Old Masters and turned to Dutch painter, Cornelis LeMair, for guidance. Under his tutelage, Jos experimented with a variety of traditional materials and approaches. His work took on another form. He liked the traditional techniques but wanted to give his paintings a more contemporary look. Now he has a definite signature and is very much appreciated.

Jos shows regularly at galleries throughout the Netherlands, France, the USA and elsewhere. His work is included in numerous collections and he regularly receives commissions from an international clientele.

His sister, Monique Van De Ven, is a well-known actress in The Netherlands and his daughter, Nadia Van De Ven, is an actress who recently started working in Hollywood. She’s been on Days of Our Lives and an episode of “ER.” She even has a MySpace page.

If you want to learn more about the artist, you’re on your own, unfortunately. Apart from his own website, there’s not much else out there about his work.

 

Filed Under: Art & Beer

48 Million Still Drunk

May 17, 2009 By Jay Brooks

Back in March, I mentioned a statistic I ran across in Maxim magazine, that 46,948,952 people in the world are drunk at any given time. That was the specific number given in the factoid, which I figured was approximately 0.68% of the population of the world. The current Playboy magazine for June 2009 has the same statistic listed on it’s “Raw Data” page, but expressed as “An estimated 0.7% of the world’s population is drunk at any given time.” There’s still no citation for the source of the factoid, but using the current world population, which as I write this is 6,910,026,951, that works out to 48,370,189 drunk souls. That makes it fairly consistent with the previous figure, so the two probably share the same source, if only they’d be so kind as to actually include it. I’d really like to know how they arrived at that figure, the criteria used, etc. You can find this statistic all over trivia sites, but no one cites its origin. Still, it’s an interesting tidbit.

 

Filed Under: Uncategorized Tagged With: Uncategorized

World’s Worst Beers

May 16, 2009 By Jay Brooks

worst
Well, at least according to Rate Beer these are the world’s fifty worst beers as rated by their members. Here’s the introduction to RateBeer’s list:

Below is a list of worst beers in the world as rated by the thousands of beer enthusiasts at RateBeer.com. Dare to try them? We don’t advise it. We provide this list in the name of beer education. We aren’t picking on the fat kid as much as we’re making a few big brewers accountable for their products that are more about beer hype and marketing than substance.

So one has to assume that by worst they mean ones that people generally don’t like drinking, worst in the sense of their popularity among beer geeks, worst in the sense of having very little flavor or worst in the sense of being made by very large companies with bad reputations among the fans of small breweries and specifically not in the sense that they aren’t well made. Because like it or not, most of the beers made by the big breweries are technically very well made, it’s just that a majority of people who are passionate enough about beer to go to RateBeer and rate the beers that they try tend not to like American-style light lagers and similar styles.

And most, if not all, of these beers were not sampled blind, meaning there was more than likely strong bias against them in rating them. Because also, like or not, many of the beers on this list are also some of the most popular beers in the world. No. 36, Bud Light, for example, is the highest ranked brand in the world according to the 2009 Millward Brown Optimor Top 100 and the second most popular beer brand in the world according to Plato Logic. I’m no fan of these beers personally and I’m certainly not trying to champion any of the ones on this list, but I do want to put this into perspective.

The World’s Worst Beers

  1. Halsnæs Poulsen / Halsnæs Bryghus (Denmark)
  2. Busch NA / Anheuser-Busch InBev
  3. O’Douls / Anheuser-Busch InBev
  4. Gluek Stite Light Lager / Cold Spring Brewery
  5. Olde English 800 3.2 / Miller Brewing Company (MillerCoors)
  6. Pabst NA / Miller Brewing Company (MillerCoors)
  7. Hurricane Ice / Anheuser-Busch InBev
  8. Sleeman Clear / Sleeman Brewing & Malting Co. (Canada) (Sapporo; Japan)
  9. Black Label 11-11 Malt Liquor / Miller Brewing Company (MillerCoors)
  10. Natural Light / Anheuser-Busch InBev
  11. Natural Ice / Anheuser-Busch InBev
  12. Tooheys Blue Ice / Tooheys (Lion Nathan Co.; New Zealand)
  13. Michelob Ultra / Anheuser-Busch InBev
  14. Milwaukee’s Best / Miller Brewing Company (MillerCoors)
  15. Coors Non-Alcoholic / Coors Brewing Company (MillerCoors)
  16. Diamond White Cider / Matthew Clark Cider (England)
  17. Miller Sharps / Miller Brewing Company (MillerCoors)
  18. Tuborg T-Beer / Carlsberg Brewery (Denmark)
  19. PC 2.5 g Low Carb / Brick Brewing Company (Canada)
  20. Jacob Best Ice / Miller Brewing Company (MillerCoors)
  21. Coors Aspen Edge / Coors Brewing Company (MillerCoors)
  22. Bud Light Chelada / Anheuser-Busch InBev
  23. Molson Kick / Molson Breweries (MolsonCoors; Canada)
  24. Bud Ice Light / Anheuser-Busch InBev
  25. Genesee NA / High Falls Brewing Company
  26. Busch Ice / Anheuser-Busch InBev
  27. Rockman High Gravity Lager / Sleeman Brewing & Malting Co. (Canada) (Sapporo; Japan)
  28. Molson Ex Light / Molson Breweries (MolsonCoors; Canada)
  29. Old Milwaukee Ice / Miller Brewing Company (MillerCoors)
  30. Labatt Sterling / Labatt Breweries (InBev; Canada)
  31. Blue Ice Beer / San Miguel Brewery (Hong Kong)
  32. Hek Original Lager Blonde Beer (Blue label) / Groupe Geloso (Canada)
  33. Pabst Ice / Pabst Brewing Company
  34. Tooheys Blue Bitter / Tooheys (Lion Nathan Co.; New Zealand)
  35. Fosters Light / Fosters Brewing (Australia)
  36. Bud Light / Anheuser-Busch InBev
  37. Busch Light / Anheuser-Busch InBev
  38. Camo Silver Ice High Gravity Lager / City Brewery (Melanie Brewing Co)
  39. Tooheys Extra Dry Platinum / Tooheys (Lion Nathan Co.; New Zealand)
  40. Milwaukee’s Best Light / Miller Brewing Company (MillerCoors)
  41. Pabst Extra Light / Pabst Brewing Company
  42. Molson Ultra / Molson Breweries (MolsonCoors; Canada)
  43. Camo 900 High Gravity Lager / City Brewery (Melanie Brewing Co)
  44. Matt Accel / Matt Brewing Company
  45. Adelskronen Mix Alsterwasser/ Radler / Feldschlößchen Braunschweig (Carlsberg; Denmark)
  46. Lucky Lager Force 10 / Labatt Breweries (InBev)
  47. Busch Beer / Anheuser-Busch InBev
  48. Schlitz Red Bull / Miller Brewing Company (MillerCoors)
  49. Molson Exel / Molson Breweries (MolsonCoors; Canada)
  50. Fosters Light Ice / Fosters Brewing (Australia)

There are some obvious problems with the list. For example, six of the beers are non-alcoholic (I marked them in blue). I know they’re trying to duplicate the taste of beer, but with less than 0.5% alcohol, I’m not sure they should be a part of this list. They’re designed for a very specific purpose, that is for people who can’t tolerate alcohol for whatever reason. A casual drinker would never choose one of these beers absent some specific need. For that same reason I’d argue that gluten-free beers should also not be on such a list, but there aren’t any on the list surprisingly enough. Also one of the items on the list, No. 16, is hard cider, not a beer at all. In the original list, Nos. 33 and 41, Pabst Ice and Pabst Extra Light, respectively, are attributed to MillerCoors, though they only brew them under license for Pabst, who owns the labels.

 
Also, just as a matter of curiosity, here’s some additional interesting data I gleaned from the list:
 

Company Distribution

  1. Anheuser-Busch In Bev = 12 (24%)
  2. MillerCoors = 11 (22%)
  3. MolsonCoors = 4 (8%)
  4. Carlsberg = 2 (4%)
  5. Fosters = 2 (4%)
  6. Labatt/InBev = 2 (4%)
  7. Pabst = 2 (4%)
  8. Sleeman/Sapporo = 2 (4%)
  9. Toohey’s/Lion Nathan = 2 (4%)

Country of Origin Distribution

  1. United States = 31 (62%)
  2. Canada = 9 (18%)
  3. Denmark = 3 (6%)
  4. New Zealand = 3 (6%)
  5. Australia = 2 (4%)
  6. England = 1 (2%)
  7. Hong Kong = 1 (2%)

Style Distribution

  1. Light Lagers = 28 (56%)
  2. Ice Beer = 11 (22%)
  3. Malt Liquor = 7 (14%)
  4. Non-Alcoholic = 6 (12%)
  5. Spice/Herb/Vegetable Beer = 3 (6%)

Filed Under: Beers, Editorial, Related Pleasures Tagged With: RateBeer, Statistics

Alabama Frees the Hops … Almost

May 14, 2009 By Jay Brooks

I heard from the folks at Free the Hops earlier today (thanks Casey) that their efforts have almost paid off. The Alabama State Senate today passed HB373, which would allow beer that’s above 6% a.b.v. to be sold in Alabama. That’s terrific news for the beer lovers of the state. There’s now only one remaining step for the bill to become law, and that’s for the Governor to sign it.

If you live in the state of Alabama, you can help “encourage the Governor to sign [the] bill.” From the Free the Hops blog:

That’s why we’re asking everyone in the state who values personal freedom and who thinks the Alabama government should stop telling us which beers are ok to drink and which ones we can’t handle to contact Governor Riley immediately. By phone, fax, or email, whatever works best for you.

If you can help, see how at the Free the Hops blog, where there are specific instructions on how to reach the Governor’s office by phone, fax or e-mail.

 
If you want to know what they were up against, here’s a representative example by Democrat Alvin Holmes who is in the state house, representing the 78th District, which is Montgomery (the state capital).

 

 

Filed Under: Uncategorized Tagged With: Video

Action Alert: Contact Your Representative Re: Beer Taxes

May 14, 2009 By Jay Brooks

If you read my previous post about the Senate Finance Committee round table on Tuesday, where three of the thirteen people called on to testify about how to pay for Obama’s $1.5 trillion universal health case initiative suggested that the excise tax on beer should be increased by between 50% and 400%, then you won’t be at all surprised that the Beer Institute’s Legislative Action Network has issued an Action Alert for people in favor of keeping good beer affordable. They’re asking that people, if so motivated, please “call your member of Congress and your Senators, especially if they are on the Senate Finance Committee and weigh-in on the devastating impact ANY increase on the federal excise tax on beer would have on your business. The following two links can help you determine your member of Congress and Senators. And below is a table of the members of the Senate Finance Committee with a link to each member. Public comments can also be made at the committee’s website.

 

DEMOCRATSREPUBLICANS
MAX BAUCUS, MT
JOHN D. ROCKEFELLER IV, WV
KENT CONRAD, ND
JEFF BINGAMAN, NM
JOHN F. KERRY, MA
BLANCHE L. LINCOLN, AR
RON WYDEN, OR
CHARLES E. SCHUMER, NY
DEBBIE STABENOW, MI
MARIA CANTWELL, WA
BILL NELSON, FL
ROBERT MENENDEZ, NJ
THOMAS CARPER, DE

CHUCK GRASSLEY, IA
ORRIN G. HATCH, UT
OLYMPIA J. SNOWE, ME
JON KYL, AZ
JIM BUNNING, KY
MIKE CRAPO, ID
PAT ROBERTS, KS
JOHN ENSIGN, NV
MIKE ENZI, WY
JOHN CORNYN, TX

 

Below is additional analysis of the impact of raising the excise tax on beer from the Beer Institute.
 

Raising Alcohol Taxes Will Have a Severe Economic Impact,
Offsetting Any Revenue Generated by the Tax

Directly and indirectly, the beer industry employs approximately 1.9 million Americans, paying them almost $62 billion in wages and benefits and generating more than $198 billion in economic output. Proposals to triple or quadruple the excise tax will have severe economic impacts on the industry. Just tripling the current beer tax to $20.25/proof gallon will cost the country jobs at a time when the national unemployment rate is the highest it has been since 1983. Beer Institute estimates that a 300% increase in the excise tax on beer will result in 179,000 lost jobs, $5.9 billion in lost wages, $18.9 billion in lost economic output, and $2.7 billion in lost federal, state, and local revenues from decreased production and consumption. The impacts of these tax increases may be even greater for small businesses as microbreweries and brewpubs will be hit with significantly larger tax bills. Many of these smaller companies may be forced to close.

An excise tax is designed to collect additional monies as volumes increase over time. The growth in beer industry volumes have added more than $800 million in additional federal revenue since 1991 when the beer excise tax was doubled. Excise taxes are hidden taxes on consumers who pay them in the final retail price of a product. In 2008, taxes on the beer industry at all levels of government added up to more than $41 billion dollars. The total tax burden of federal, state, and local taxes on beer are more than 41 percent of the retail price paid by consumers.

Beer Taxes Disproportionately Affect
Lower Income Consumers

Approximately 50 percent of all beer purchased in the United States is by consumers with household incomes of $50,000 per year or less. That means the relative impact of beer excise taxes on households in the lowest income brackets is 6.5 times greater than those with the highest incomes.

The vast majority of our consumers are hardworking Americans who do not abuse alcohol products (Source: Harris Interactive, 2008). By levying an even higher tax on this segment of the population, Congress will make it even more difficult for them to enjoy a simple pleasure during these difficult economic times. These are exactly the people who should not be penalized in a misguided attempt to deter the small percentage of the public that abuses these products. Furthermore, during the fall 2008 campaigns, many candidates called for providing tax relief to this portion of the population. Brewers and beer importers agree, which is why they have supported measures such as the Brewers Excise and Economic Relief (B.E.E.R.) Act of 2009, which already has 174 cosponsors in the U.S. House of Representatives. The BEER Act (H.R. 836) hopes to return the federal beer excise tax back to its pre-1991 level of $9 per barrel for large brewers and $3.50 for small brewers.

 

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U.S. Senate Told To Raise Beer Taxes

May 14, 2009 By Jay Brooks

As reported by Harry Schumacher in his Beer Business Daily (subscription required), at a Senate Finance Committee round table on Tuesday, three of the thirteen people called on to testify about how to pay for Obama’s $1.5 trillion universal health case initiative suggested that the excise tax on beer should be increased by between 50% and 400%. They also suggested — finally — that excise taxes be applied to soda pop (although I think perhaps it should be anything with high fructose corn syrup) among much else, such as trans fat and sodium levels in packaged and restaurant foods (though why not remove all the sugar in packaged foods, too?). Even though I disagree with the concept of excise taxes, at least people are finally suggesting taxing products which in my opinion are more harmful to society as a whole than alcohol.

Here’s what Mike Jacobson, the director of the horribly misnamed Center for Science in the Public Interest (CSPI) told the Senate Committee:

Because alcohol beverages are a “major cause of illness, addiction, death, injury, and psychosocial problems, Congress should raise alcohol excise taxes, tax all products equally on the basis of their alcohol content, and index tax rates for inflation. Boosting the tax on distilled spirits by 50 percent and equalizing the beer and wine rates would generate $12 billion in new revenues annually. Simply adjusting tax rates for the inflation that has eroded revenues since the last increase (in 1991) would raise $5 billion in new revenues per year. Higher taxes and prices would dampen alcohol consumption and lead to additional health-care and other cost savings to the federal government and to the economy generally.”

Jacobson’s arguments are typical of modern prohibitionists, full of scary statistics that prove to be wrong or inflated at best, propaganda, and selective reasoning (when they’re reasoning at all). When he says that “[h]igher taxes and prices would dampen alcohol consumption” does he not get that it would reduce the tax benefits, as well? Putting an entire industry out of business removes personal income tax, business tax and wipes out the excise taxes completely. And that helps raise more revenue how? And then of course there’s the numbers. Even if we accept his $12 billion in new revenues figure, that means his idea of burdening an entire industry would raise 0.008% of the $1.5 trillion total needed to fund the President’s health care initiative. It’s kind of ironic that’s it’s point-0-0-8 percent. Now how rational a suggestion is that? Let’s kill an industry that’s actually keeping people employed to raise a tiny fraction of the money needed.

But one of his arguments is especially laced with error and a false conclusion. Here’s the argument:

Some parties (usually industry) express concern about the regressivity of alcohol taxes, but the actual problem is much exaggerated. In fact, compared to upper-income consumers, lower income families buy much less alcoholic beverages. People in the lowest quintile of incomes consume only 8 percent of alcoholic beverages; those in the top quintile consume 38 percent. Overall, only 1 percent of Americans’ total expenditures are for alcohol, regardless of income. Most people would be little affected by higher alcohol taxes. More than one-third of adults do not drink at all, and half of all drinkers drink sparingly. For instance, using the highest-increase scenario discussed above, half of all beer drinkers would pay less than $10 per year—under three cents a day—in new taxes. Because alcohol consumption is heavily concentrated among the top 20 percent of drinkers who consume 85 percent of all the alcohol, most of the tax increases would be paid by those who drink excessively. Using some of the revenues for alcoholism treatment, prevention, and public education would further reduce the toll of alcohol problems and would probably disproportionately benefit low-income problem drinkers.

Is it at all surprising that the top 20% (which is a “quintile”) income households (who have lots more money) buy a disproportionally larger amount of alcohol? I suspect they also buy a higher percentage of food, soda, and every other conceivable consumer product or service too. The bottom 20%, with far fewer resources can’t afford to buy as much. So WTF? That somehow makes it fair because people with more money can afford to buy more and thus can pay higher prices? And that also somehow means it’s not regressive after all? What a nutter. The lower income bracket would also be more burdened since they’re already heavily burdened by virtue of their limited buying power. They could only afford less, but that’s not regressive?

And why is it okay if “most of the tax increases would be paid by those who drink excessively?” Why punish people who choose to drink more? It’s people like Jacobson that actually make me want to drink more. But what that tacitly means is that he’s characterizing the tax in moral terms as a sin tax. He’s suggesting, not very subtly, that people who drink more deserve to be punished. And see here I thought the point of the discussion was to fund health care for all Americans, not target certain ones that the CSPI disagrees with and punish them.

And then there’s the tired argument that the higher taxes could fund “alcoholism treatment, prevention, and public education” which further reduces the amount available for the initiative. Just suggesting that funds be diverted for such specific programs makes clear in my mind that he doesn’t really understand why the Senate asked for his testimony.

But according to Harry it gets worse. Here’s what Robert Greenstein of the supposedly liberal Center on Budget and Policy Priorities thinks should be done:

After pointing out that alcohol taxes are lower today than when they were last raised in 1991 due to inflation, he recommends one of three options, each worse than the one before:

  1. The first option would be to raise tax rates back to where Congress set them in 1990 — i.e., to put them at the 1991 level, but adjusted for inflation since that time. Under this option, taxes would increase by nearly a buck a case, to $2.16 a case in federal taxes alone.
  2. Behind door number two is an option that is apparently put forward by the Congressional Budget Office, which is to set alcohol taxes at a uniform $16 per proof gallon, which means equalizing beer, wine, and spirits taxes. The current tax on spirits is $13.50 proof per gallon. This CBO option would raise that to $16 per proof gallon and also apply it to beer and wine. This would nearly triple the federal excise tax on beer, raising it by $2.16 a case, for a total federal tax of $3.36 per case, while simultaneously increasing spirits taxes by a lesser multiple.
  3. The final option Dr. Greenstein proposes, which almost makes me sick to even write about, would be to combine the first two options in a sort of alcohol Armageddon. Under such an approach, alcohol would be taxed across the board at the level that distilled spirits were taxed in 1991, when Congress last acted, with that level adjusted for inflation since 1991 and going forward. Under this option, the tax on a case of beer would quadruple to about $4.32 a case.

First let’s address the inflation argument. If that’s true, then isn’t practically every thing in the world cheaper now due to inflation, isn’t every unadjusted tax in the same situation? And if so, then why aren’t we talking about adjusting all taxes for inflation? Why are we only talking about alcohol?

He acknowledges that “moderate alcohol consumption can be neutral or even beneficial for health,” but seems to believe that it’s still acceptable to punish all alcohol consumers because of the supposed high costs imposed by “excess alcohol consumption.” Even if true, why is this an acceptable line of reasoning, that everyone should be punished for the excesses of a small minority? How did we get to a point in our social evolution where that seems like a good idea?

He goes on to cite the similarly spurious arguments that “the National Academy of Sciences has recommended raising alcohol excise tax rates to discourage underage drinking” and “a 2007 report issued by the Surgeon General noted that increasing the costs of alcohol use (i.e., raising the tax on alcohol) could influence teenagers to drink less.” How does anyone read that and not see the flawed logic? Not only is that not what he was asked to testify about, but we should raise taxes (and prices) on all alcohol because it “could” make people who are already forbidden from drinking it consume less? That just makes no earthly sense whatsoever.

Then there’s the idea of making taxes on alcohol uniform — a kind of “flat tax” — by proof per gallon. Forget all the math, this simply ignores the costs of making the very different alcoholic beverages, their pricing and how they’re consumed. Spirits, of course, cost much more than beer and wine is likewise often much more expensive then beer, too. While both could conceivably withstand a tax increase because of the higher price they command in the marketplace, beer would be absolutely decimated by such a taxing structure.

He concludes with more nonsense about moderate drinkers not being unduly burdened since they drink less already. That therefore the increased taxes would mean the price of their alcohol would only rise a little bit, ignoring, of course, the reality that if the taxes on a glass of wine increased 10 cents that the price would not go up merely 10 cents, too, but by far more. This is the same argument that Jacobson made, just in a slightly different form, and its just as ridiculous an argument here, too.

The third person to bring up alcohol was Jonathan Gruber, a Professor of Economics at M.I.T.

Sin Taxes: The second is increased taxation of “sin good” whose use raises the cost of health care for all Americans. This would include cigarettes, alcohol, and high sugar or fat foods that cause obesity. There is a strong public policy argument for raising taxes on all of these goods. In particular, the tax rate on alcohol is well below the level that would account for the damage that drinking does to society, in particular through drunk driving. Yet it is difficult to raise sufficient revenues from these sources, and these revenues will not rise at the rate of health care spending; indeed, they are likely to fall over time if we move the population towards healthier lifestyles.

Gruber at least concedes that raising these taxes would not only raise very little money but that the amount would decrease over time, as well. So you have to wonder why he brought it up at all. What I find perhaps most troubling is that he refers to taxing these particular items as “sin taxes.” That just seems like such antiquated thinking. I don’t think an economics professor gets to decide what is and isn’t a sin. He may consider alcohol to be a sin, but millions of other Americans believe it’s perfectly acceptable to drink an alcoholic beverage. And both positions are equally valid because deciding what’s a sin is a personal decision based on one’s religion or moral compass, which still was — last time I checked — a freedom we all enjoy as citizens of the United States thanks to the Bill of Rights. So I think Gruber is more than a little presumptuous when he tries to decide what’s a sin for all Americans.

Here’s Harry’s take on the whole proceedings:

It’s clear that these and other groups’ alcohol tax agenda — which they’ve been peddling for years — is only gaining an audience now with the powers in Washington because the federal treasury is in desperate need of funds. It’s clear to me that they are presenting more public policy arguments than fund raising. After, even the most draconian measure above only raises about $30 billion over five years, and that’s if consumption doesn’t fall off a cliff (which we know it does when looking back at the 1990 doubling of taxes). That’s a fraction of the trillions needed to fund this program. Plus it’s a highly regressive tax, and the resulting job losses will reduce income tax revenue, something I’m quite sure is not figured into their numbers. Jonathan Gruber, PhD, professor of economics at MIT pointed out the paradox of it to the good senators in attendance: “It is difficult to raise sufficient revenues from these sources, and these revenues will not rise at the rate of health care spending; indeed, they are likely to fall over time if we move the population towards healthier lifestyles.” In other words, higher taxes reduces consumption, which in turn reduces taxes. Not a great business model, even for the government.

We must keep this all in perspective. This was only a round table (not even a formal hearing) of a bunch of propellerheads with letters behind their names, policy wonks who’ve never run a small business or had to scrounge to make payroll (I mean that with the utmost respect, of course). We knew what they were going to say before the said it. Having said that, it’s clear this isn’t going away because of the desperate money grab going on in Washington right now. Now we must band together and fight this the smart way. If you haven’t had your senator or congressman to your brewery or distributorship lately, this summer break is the perfect time.

Harry’s right, of course, about keeping this in perspective. I guess I should be pleased that only three of the thirteen targeted alcohol. But I’m also quite worried that we’re seeing only the tip of the iceberg in a more concerted effort by neo-prohibitionist groups like the CSPI, and others, to use our present economic crisis to their advantage to further an unrelated agenda. The number one priority of most, if not all, politicians is to stay in office. Using alcohol as a bogeyman can be an attractive alternative from having to face the real causes and consequences of our current economic situation. As a result, I feel quite confident in saying this is not the last time we’ll find alcohol squarely in the crosshairs. At this point as the economy continues its downward slide, the politicians and the New Drys whispering in their ear about demon alcohol will continue to find common ground to the potential detriment of the millions of Americans who enjoy a drink now and again, not to mention the millions more whose livelihood depends on alcohol to feed their own families and pay their taxes. It shouldn’t be an us vs. them world, but it sure seems increasingly that way.

 

Portions from Beer Business Daily reprinted with permission. If you don’t already subscribe, and beer is your business, you should consider subscribing to Harry’s daily (and sometimes more frequent) e-mail newsletter.

 

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