Happy Prohibition Repeal Day! Or so you may think.
Wednesday, Dec. 5, marks the 85th anniversary of Prohibition being officially repealed, ending our nation’s failed experiment in banning alcohol. Booze enthusiasts around the country will likely head out to their nearest watering hole tonight and raise their glasses in a toast, celebrating the fact that our government no longer micromanages our booze.
But is this true? You may take it as a truism that our alcohol markets have operated free and clear in the decades since Prohibition, but sadly the reality is far more complex. Across the country, all levels of government continue to have woefully outdated and restrictive laws on their books concerning alcohol. Worst of all, many of these laws do little to protect public health and safety, but rather operate mainly to help vested economic interests.
Few Americans appreciate the history of the immediate post-Prohibition era and how it continues to affect alcohol markets today. When the 21st Amendment repealed Prohibition in 1933, it devolved control over alcohol to the states. Crucially, the language of the 21st Amendment largely mirrors the language of the 18th Amendment, which originally instituted Prohibition, with the exception that it gives state governments, rather than the feds, near total control over alcohol.
The result was a “rush to regulate” among state and local governments during Prohibition’s aftermath. Many states established a control system, in which the government itself controlled all sales of alcohol. In 2018, more than a dozen states still control alcohol sales at the retail level, forcing consumers to shop at government-run liquor stores. Other states opted for a three-tiered system of alcohol distribution that requires producers, wholesalers, and retailers of alcohol to be legally separate entities — a requirement that is not present in nearly any other industry.
We continue to live with these outdated regulatory systems. States like Virginia strictly control all sales of distilled spirits and charge ludicrous markups that accrue to government coffers, while three-tiered states like Maryland require brewers to buy back a portion of their own beer from wholesalers before they can sell it in their own taprooms. The examples of post-Prohibition legal relics don’t stop there.
Indiana has a ridiculous prohibition on selling refrigerated beer in gas stations and convenience stores. Utah’s “Zion Curtain” mandates that bartenders mix cocktails behind partitions or other barrier zones so as to not allow minors to see a drink being made. D.C. forbids customers who order bottle service from carrying the bottles around the bar on the grounds that “large containers may be used as weapons during altercations.” Louisiana continues to ban airplane mini bottles.
The examples of insane alcohol regulations are so plentiful that we at the R Street Institute recently compiled a whole report on “America’s Dumbest Drinks Laws.”
Nearly all of these laws, in one form or another, are vestiges of the post-Prohibition system of alcohol regulation that we continue to labor under. Rather than updating our drinking laws in accordance with modern understandings of morality and markets, state and local governments continue to insist that alcohol is a dangerous product that the citizenry must be protected from.
While some laws governing alcohol are important to prevent things like drunken driving and other harmful behavior, the lion’s share of alcohol laws have nothing to do with health or safety. Bad alcohol laws ultimately mean less choice for consumers and fewer jobs created by craft alcohol producers.
Is anyone really being kept safer by being forced to buy warm six-packs in Indiana? Are kids really less likely to drink thanks to Ohio’s law banning booze ads that reference Santa Claus?
The answer, of course, is no. So, by all means, when you head down to the local bar to celebrate Repeal Day, be grateful for how far we have come. But also remember that we’ve got a long way to go.
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