A populist cold beer rebellion is brewing

If there’s been a curve ball in this waning session of the Indiana General Assembly, it’s been the Ricker’s cold beer controversy. If key players aren’t careful, this could signal a populist uprising in the age of Amazon, Trump and the anti-regulation fervor that has swept Indiana and the nation.

There is significant danger for the package liquor store industry and their lobby. As they attempt to defend the status quo, they risk an array of collateral damage. For instance, in their attempts to thwart Ricker’s in their legally obtained licenses at two convenience stores in Columbus and Sheridan, they took aim at the Indiana Alcohol Tobacco Commission, and drew in Gov. Eric Holcomb, who up until this past month had been “laser focused” on his five-point agenda that didn’t include cold beer. Instead, he stepped in to defend the conduct of this commission which granted the permits per state law.

Speaking at Indiana University last month, Holcomb had another message: If you resist change, you risk irrelevance. “If you’re not growing, you’re dying,” he said.

Ricker’s created headlines over the past month and drew populist sentiments. Look no further than Democrat Gary Snyder of Huntington, who will challenge freshman state Sen. Andy Zay. Snyder posted on Facebook, “As your next state senator, I will not vote to regulate the temperature of the beer you buy or what days you can buy it.”

That could be the beginning of a 2018 cycle trend as Democrats attempt to claw back into relevance.

Bring the topic up in a room of average Hoosier Joe Sixpacks, and the notion that you can only buy cold beer at a package liquor store and not on Sunday brings derision. This is the age of Amazon, where people can order and buy just about anything, any time, anywhere. We have witnessed the dramatic transformation of commerce via the internet and Amazon, impacting the news media, higher education, state taxation, mobility, power and transportation.

Over the past 15 years or so, not only has the Amazonization of America occurred, there has been an explosion of vineyards, craft breweries and the transformation of grocery stores (and their pharmacies) that have opened up the sale of liquor and wine while perpetrating…warm beer.

Add in the anti-regulation environment that began here under Gov. Mitch Daniels, continued under Gov. Mike Pence, and has been embraced by President Trump, and what’s transpired is a perfect storm of consumer demand and an assault on rules and regulations. Throw in cunning lawyers who found and exploited loopholes the package liquor store industry knew existed years ago, and there’s controversy.

When it comes to the three-tiered alcohol system put in place overnight eight decades ago, these special interests now find themselves defending a status quo that seems absurd to the man on the street. The Average Joe can go to the Broad Ripple Brew Pub or Big Woods and quaff a couple of pints of beer on a Sunday afternoon, then take home a couple of growlers, but our friend Joe can’t go to the Village Pantry and pick up a six of cold Budweiser.

While Marsh, Kroger and Martins have become literal package liquor stores, Joe can’t go in and buy a cold 12-pack. On Sundays, he has to find a brewery or commercial vineyard, or cross into Michigan, Ohio or Illinois to buy cold bottled beer. Joe doesn’t always plan ahead for that Sunday barbecue and this cold suds denial mocks and irritates him.

The 80-year-old three-tier system was thrust into place in 1933, with lessons learned decades earlier, when brewers sold directly to taverns creating rampant consumption. Prohibition brought about Al Capone and gangsterism, and when the epic social experiment ended with the 21st Amendment, the three-tier system was created to buffer the flow of alcohol, create a level of consumption control that promoted (to some degree) moderation, and taxation points.

There are some 12,000 points of access for alcohol in Indiana, and tens of thousands of suppliers worldwide. The three-tier system has been enduring because it allows the state to control access points, regulate and tax. Without it, the excise policing would become a vastly larger force than is in place today.

The dilemma for the package store industry is that changing the temperature and Sunday restrictions will put them in direct competition with the big box stores.

What’s the solution? Legislation by House Majority Leader Matt Lehman last year created a two-year study committee of the entire Title 7.1 three-tier system. The key players also include state Sen. Ron Alting and House Public Policy Chairman Ben Smaltz. That study is expected to be completed in 2018, an election year.

Speaker Brian Bosma, Senate President David Long and others have described the evolved three-tier system as archaic and “antiquated,” but the Hoosier consumer must be wary of the special interests who seek to preserve the status quo.

The dilemma is that in this populist environment, and in a new age of consumerism that has put entities like HHGregg, Payless Shoes, and Sears on the endangered species list, there could be a political cost to those who simply seek to defend that status quo.

— Brian Howey is publisher of the Howey Political Report, a weekly briefing on Indiana politics. Contact him at (317) 506-0883 or at: howeypolitics.com

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