State Lawmakers Dump Consumer-Friendly Booze Reforms for Liquor Store Protectionism

Michigan and Indiana lawmakers cave to liquor store owners' protectionist demands.



State lawmakers in Michigan and Indiana have fumbled opportunities to loosen longstanding laws limiting alcohol sales, leaving consumers with lukewarm brews and longer booze runs.

In other words, liquor store owners got exactly what they wanted.

Indiana lawmakers killed a proposal to abandon the state's bizarre "warm beer law," which says only liquor stores are allowed to see "cold or iced" brews. Other retailers—grocery stores, convenience stores, pharmacies, and the like—can only sell room-temperature beer. It is the only state in the country to regulate the sale of beer based on temperature.

A proposal to do away with that nonsensical restriction died in committee last week, The Indianapolis Star reports.

Like many weird state laws about alcohol sales, Indiana's warm beer law is a remnant of Prohibition. After the federal ban on selling alcohol was lifted in 1933, Indiana created different types of licenses for selling booze, and those licenses have evolved over time so that the same bottle of beer can be sold cold in one location but has to be warm in the store next door.

In Michigan, meanwhile, you won't find two next-door stores selling the same liquor at any temperature. Under the so-called "half mile rule," Michigan liquor stores must be located at least 2,640 feet from one another. The Michigan Liquor Control Commission struck down that protectionist rule earlier this year, but state lawmakers moved to resurrect it at the behest of liquor store owners, The Detroit News reports.

"You have families that have invested their life savings in a store, now suddenly they can have a store right across the street, right next to them?" state Sen. Rick Jones (R–Grand Ledge) told the newspaper.

If you think Jones' argument makes sense, try putting it in any other context. It would be ridiculous to suggest that McDonald's can stop Burger King from opening a new location "right across the street," no matter how much the existing franchisee might have invested. There's nothing inherently different about liquor stores, except that they sell booze instead of burgers.

The same is true of Indiana's warm beer rule. Imagine if Starbucks pushed through a law saying that Dunkin' Donuts could only sell lukewarm coffee. Everyone would recognize that as a ridiculous abuse of government power. Doing the same with beer has nothing to do with protecting consumers; it's just a special benefit bestowed on one business at the expense of the others.