Newspaper article St Louis Post-Dispatch (MO)

Editorial: Lawmakers Should Keep Out-of-State Booze Business Poachers at Bay

Newspaper article St Louis Post-Dispatch (MO)

Editorial: Lawmakers Should Keep Out-of-State Booze Business Poachers at Bay

Article excerpt

If you watch the HBO drama "Boardwalk Empire," you know there are not a whole lot of sympathetic characters in the show about Atlantic City during the Prohibition era.

The television drama is ostensibly about how a bunch of crooks divide up the booze business during a time in which alcohol sales were illegal. The main character, played by actor Steve Buscemi, is Enoch "Nucky" Thompson, the kingpin of organized crime in this Jersey Shore town, who spends much of his time buying off politicians or fighting with other crime syndicates wanting a piece of the booze and casino action in Atlantic City.

Minus the gratuitous killing and sex, Missouri's own version of the plot is playing out this year in the Missouri Legislature.

At issue is a debate over Senate Bill 365 and House Bill 759, two relatively innocuous pieces of legislation that will say a lot about who makes money in the liquor trade in the Show-Me State for years to come.

Both bills would return Missouri's franchise liquor laws to the status quo that was in place for 40 years. The basic structure of liquor sales law is even older, going back to 1934 when the Legislature established a three-tier system of alcohol regulation following adoption of the 21st Amendment, which ended Prohibition. That system, creating separate state-based roles and responsibilities for suppliers (like Anheuser-Busch InBev), wholesalers (such as St. Louis-based Major Brands), and retailers (supermarkets, package stores, etc.), protects consumers from one player in the liquor business exercising too much control over price or competition.

It works like this: The companies that make the beer, wine, rum or vodka make deals with wholesalers to distribute their booze in the state. Those wholesalers, in turn, sell to retail outlets. The added layer of middlemen assures that one player can't prevent its wholesaler from carrying competing products, for instance, making it next to impossible for a craft beer company such as Schlafly to get its product to market.

A good comparison is the Justice Department's recent negotiation with Anheuser-Busch InBev over its purchase of Mexican beer company Modelo, maker of Corona. …

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