September 11, 18 years later

This is a post from ten years ago. That fall we were spending a month in New York City. This fall I am at home. In the past ten years, a lot has happened to both me and the country.

What is very surprising to me is that we are still involved in both Afghanistan and Iraq. We also have a president who has no clue how to run foreign policy. I fervently hope Trump will be a one-term President and then we can try to undo all the harm he has done.

My sympathy goes out to all who suffered a loss on that terrible day. May all of their memories be for a blessing.

September 11, 8 Years Later

Today is the eighth anniversary of the terrible events of September 11 2001. This is a particularly poignant day because we are in New York. Eight years ago, I had been in New York the day before, September 10, and woke up, at home. on the morning of the 11th to hear my husband’s voice on the answering machine, ” I don’t know if you have heard what happened in New York but my parents are okay.” As everyone knows, September 11 2001 was a picture perfect New York fall day and the 10th was as well. I felt very steeped in my New York roots because I had spent the evening of the 9th reading about the  pending city elections while I waited for my friend who I was visiting to come home.

Today, September 11, 2009, is not a beautiful day. The weather is  very bad, with high winds and heavy downpours. Because of these bad conditions, we have been unable to attend any commemorative event. Many of them were outdoors.

Despite that, since 2001, I have felt that this day should not be like every other day.  Apparently President  Obama and Congress agree with me. In March the federal government designated September 11th as a National Day of Service and Remembrance.  I really hope that this takes root and becomes how  people commemorate September 11th in future years.

My thoughts are with all the people who suffered a loss on that fateful day and it is my sincerest wish that nothing like that will ever happen to any person or country again.

Re-post: The Road from Repeal: The Three Tier System

As a followup to last week’s post about the impending tax legislation and it’s effect on the brewing industry, I am re-posting a blog from December 2008. At that time, in honor of the seventy-fifth anniversary of the Repeal of Prohibition, I wrote a series of posts about  Repeal and it’s aftermath. This one was about the three-tier system. It is relevant to what I wrote last week because I discussed Cindy McCain and her family’s wholesale liquor business. I wrote about that in the context of John McCain’s run for president. As I mentioned last week, you can probably draw a straight line from Hensley & Company to McCain’s support of the tax legislation.

The Road from Reform: The Three Tier System.

Prior to Prohibition distribution and sales of beer took place in variety of ways. Many brewers owned saloons which functioned as retail operations. The brewers supplied their beer to the saloon keeper.  Shipping brewers who operated on a national level maintained distribution outlets at various railroad stops. Although there were different federal fees for wholesale and retail dealers as well as excise taxes on brewers there was a lot of blurring of the lines between these different areas of the beer industry. Brewer ownership of saloons was the most problematic example.

As the federal government contemplated the return of legal liquor in 1932 and early 1933, alcohol advocates argued for a very distinct separation of production, wholesale distribution and retail sale of alcoholic beverages. Thus they established the three-tier system. Under federal law a brewer can not be the wholesale distributor of their product or the retail seller. Some aspects of this 1933 legislation had to be altered to allow the opening of brew pubs.

One outcome of this legislation was the development of a large group of beer wholesalers. Since 1938 they have had a national organization, the National Beer Wholesalers Association (NBWA). There are 2,750 wholesalers. This year the focus of the organization has been celebrating the 75th anniversary of Repeal as well as continuing to pursue permanent repeal of the estate tax, a rollback of beer excise taxes, prevent alcoholic equivalency labeling and avoid paying for public service announcement against under-age drinking. In the past leaders of the NWBA have advocated a reduction in the minimum drinking age.

Cindy McCain, wife of recent presidential candidate John McCain, is heir to one of the largest beer distributors in the country. A New York Times article in August 2008 examined the role of her family business in Arizona politics. Hensley & Company is the third largest Budweiser distributorship in the country. The mega breweries, Anheuser-Busch, Miller and Coors, have all achieved their dominance partly through creating deep and wide-spread distribution networks. Budweiser’s are the deepest of course. It is this distribution capacity and its resulting shelf space that InBev desired to purchase. It will be interesting to see if they use it to continue to sell Bud or to attempt to place some of their other beers on the same shelves.

Cindy McCain is an absentee owner and does not directly run any aspect of Hensley and Company. All of her children hold shares in the company. Her stepson, Andy McCain is a top executive and also president of the Phoenix Chamber of Commerce. Hensley & Company makes significant contributions to local politicians and contributes money to fight any potential increases in state excise taxes. The last increase was in 1984, only the third increase since Prohibition and, at sixteen cents a gallon is below the national median of nineteen cents. Hensley & Company, of course, belongs to the NBWA and supports its federal legislative agenda. Thus some observers wondered if John McCain as president would be able to be neutral on issues that related to the beer industry. Luckily we will never have to find out. As a senator he has received more money from the beer lobby than almost any other politician.

On the state level Hensley & Company have been successful in preventing taxes increase even when they have been proposed to help finance early childhood education or pediatric hospitals. The company is now supporting legislation that would make any tax increase more difficult to enact because passage would require a majority  of all registered voters not just those who vote.*

The role that Hensley and Company plays in Arizona as well as the role the NBWA plays on the national scene illustrates the changed political landscape for the brewing industry in the past seventy-five years. As the brewing industry consolidated there were fewer and fewer brewers and the larger numbers of wholesalers began to play a larger role in politics. There are many more wholesalers than there are brewers, even counting craft brewers, so they are likely to be a larger political force.

* For more information on beer and Arizona politics see the Phoenix Business Journal.

 

The Art of the Deal

I consider myself a fairly astute political observer but I will confess I am extremely puzzled and concerned by the deal Trump and Democrats struck over raising the debt ceiling. Failure to raise the debt ceiling would result in the country defaulting; the deadline was looming. Since defaulting would obviously have very negative consequences for our economy, I assume the longer we could go before having to raise it again the better.

Apparently Steve Mnuchin, Secretary of the Treasury, and the Republicans wanted eighteen months. Although that seems like a good idea, I don’t trust the Republicans so I assume they had ulterior motives or a hidden agenda, The Democrats counter offer was three months and they didn’t budge. Since there was no back and forth of offers and no compromise in the middle you can’t really call it a deal. It is more like Trump caved.

However the media seems to be spinning it as an example of Trump’s deal making. Trump sees it as a win and is ecstatic about positive press coverage. This is one of the things that concerns me about the deal. I think independents may look at it and think Trump is being bipartisan, something Obama couldn’t achieve. Of course, the reality is that Democrats generally care more about governing and it is therefore easier for a Republican president to be bipartisan. Republicans revel in being in the opposition, don’t really care about governing and are usually really bad at it. All of that made it very hard for Obama who wanted bipartisanship to achieve it.

I don’t want this to improve Trump’s approval level in polls and increase his chances for reelection. I don’t know why the Democrats are helping him to get a win. Apparently they wanted the short time frame to maintain or increase leverage on DACA and other key issues.This feels like a gamble to me since there is no guarantee that in December there will be enough Republicans to form a coalition with Democrats to pass the Dream Act in the House. The extreme political nature of this is upsetting. The short time period before the debt ceiling has to be raised again and Trump getting a win are both bad for the country which is my bottom line.

Beer and Taxes

At the end of January Congress introduced the Craft Beverage Modernization and Tax Reform Act. The bill would reduce the tax rate for large and small brewers. Both the Beer Institute which primarily represents mega brewers such as Anheuser Busch InBev and the Brewers Association which is the trade organization for craft brewers support the legislation. Similar legislation was proposed in the last Congress but did not pass. The prior bill had bipartisan support as does the current legislation.

Small brewers who produce less than two million barrels (a barrel is thirty-one gallons) annually would have a reduced rate of $3.50 a barrel for the first 60,000 barrels. All other would have a reduced rate of $16 per barrel for the first six million. The current rate of $18 a barrel would remain for companies that produce more than six million barrels a year.

The beer industry has been trying to reduce their taxes since 1991 when the rate of $9 a barrel, in effect since 1951, doubled to $18. The small brewers differential, enacted in 1976,  defines small brewers as those who produce less than two million barrels. These producers currently pay a reduced rate on their first 60,000 barrels.

The proposed legislation keeps that definition but creates another tier for brewers who produce between two and six million. Thus there is something for everyone in the bill. Mega brewers get some tax relief, small brewers who represent the vast majority of the 4,269 American breweries keep their differential  and some craft brewers like Boston Beer who have outgrown the current small brewer definition also get some relief and more importantly  get to maintain the cachet that goes along with being a craft brewer rather than a large brewer, It is not an accident that the name of the legislation includes the phrase “Craft”.

Although brewers are hopeful that the proposed legislation will succeed in the  current Congressional term, it is not clear that , after twenty-six years, they will finally achieve their goal of tax reduction. The current President is a teetotaler and he will need revenue for some of his deficit enlarging schemes such as a massive tax cut for the rich, the border wall and infrastructure projects.

Excise taxes are a very stable source of revenue that the federal government has relied on to supplement internal revenue since the 1930s. Time and again from the Civil War on, when the state has faced a shortfall they have  looked to the liquor industry to make up the gap. If the bill was not successful during the Obama administration I  don’t see why it will be any more likely in 2017.

A Time To Break Silence

I have been doing research on Anne Bennett, wife of John Bennett, president of Union Theological Seminary from 1963-1970. Anne was a committed anti-Vietnam War activist. Her husband was a founding member of Clergy and Laity Concerned. Martin Luther King, Jr. was also a founding member.

In 1967 he gave this speech to a meeting of the group at Riverside Church, New York City. The speech is amazing and makes me realize, once again, what a great man he was and what a loss his assassination was.

King showed tremendous courage in speaking out against the Vietnam War. I wonder where such a leader is today. We deeply need someone who can connect the issues of militarism and imperialism to issues of social justice.

Martin Luther King, Jr.

Bad Deal

I just watched this video from the Obama campaign about the debt ceiling deal and wrote this email in response.

I am sorry but I am not buying it. The Republicans got every thing and the American people got nothing. The President should have insisted on a clean up or down vote on the debt ceiling and if that failed used the 14th Amendment. I am seriously considering withdrawing my support. I worked very hard for his election in 2008 and donated more money than I ever have to anyone. I am very disappointed.

Past, Present, Future

Today we took a very long walk, going all the way to the lake front and then down much of the Midway. The Museum of Science and Industry was one of the buildings of the Columbian Exposition of 1893; the Midway and Jackson Park were where exhibits, the Ferris wheel, and other attraction were. It felt like we had been to the Exposition as we walked along that route.

We stared from Valois, which is supposedly President Obama’s favorite restaurant. It is a cafeteria and it had a sign about President Obama’s favorite breakfasts. There were two: steak and eggs, hash browns and toast and the other: egg whites, bacon or sausage, hash browns and toast. I am guessing the steak is really his favorite and the egg whites are his healthy choice.

Along the midway, we also passed the Law School. When I think about Obama being president, it fills me with a certain delight because he will be a historical figure. Just as I visited Rutherford B. Hayes’ home last week, future generations will visit sites associated with Obama. That’s cool.

We tried to get as close as we could to his house but the security is intense. The guard said it was against the rules even to tell me which house was his. Since you can find out the address on the Internet, I don’t get that restriction.

Of course, I support keeping the President safe and understand why they do not want to let people get close. There is a synagogue right next to his house. It must be quite a hassle to attend services. Never mind being one of the neighbors.

We had a lovely day exploring both the past of Chicago and the present and future of our country.

Chicago via Indiana

We have arrived in Chicago. We are staying in a one-bedroom apartment near the University of Chicago. The neighborhood seems vey rice with shops and restaurants. We are very tired from three days of driving, so we made dinner and are watching the Yankees- Red Sox game.

Most of the drive today was in Indiana. It was very rainy and the temperature dropped by thirty degrees. Indiana seems flat, certainly flatter than Western Massachusetts. We drove past Elkhart, which is the city that President Obama talks about in a public service announcement. As we were driving, I remembered that Indiana was the center of Klu Klux Klan activity in the 1920’s.

There were several signs for casinos. One appeared to be for a resort, similar to Foxwoods. The gaming center in Batavia left a lot to be desired. It reminded me of a video game arcade in Lake Winnipesaukee, New Hampshire. The place in Batavia did not have any gaming tables, just rows and rows of video slots, poker, and other games. Monday was senior day; it was definitely an older, retired crowd. I do not see how something like that does anything to increase tourism or help the economy of the town.

This is What Change Looks Like

House passes health care
House passes health care

About a half hour ago, I took part in an Organizing for America conference call. It was for people who had worked to get the health care bill passed.  I am very proud that I played a small part in reforming the health care system. I am also thrilled that I was on a phone call with President Obama.

President Obama said that he “hoped everyone on the phone is savoring this and that this is your victory. You did this despite being counted out time and time again. You were steadfast. You bucked up some weak knees. You made a difference. Stand strong. Enjoy the victory but our work is not done.”

He was asked what we have learned from this process. He replied, “We learned that the legislative process is painfully long and confusing. I wish I could change it – nothing is going to be as complicated as health care – went on forever. Because of filibuster, anything we do is going to go through some contortions. Important to remember this and be patient and don’t get discouraged.

If we just have persistence and don’t lose sight of ultimate goal, the daily twists and turns are not as important. It requires some fortitude.

He also said, “I learned that it is important to boil down message to two or three talking points.  I learned change is possible – if something is not exactly perfect, important to stay focused. In the big picture history of social change – if you get a basic framework then refinement will happen to move in the direction of progress.”

“Stay hopeful, positive, focused on big picture, stay with it, and be dogged. The reason I don’t quit is because you don’t quit. I draw inspiration from you.”

Federal Beer Tax Decrease Unlikely

Every day I get Google alerts about the brewing industry. Today I got one that linked to a Northern Michigan TV news story about a possible decrease in federal beer taxes. Apparently the proposed legislation would cut the small brewers tax in half and reduce what large brewers pay by one-ninth.

The video showed an earnest craft brewer, at his plant, indicating how he could use the extra money to grow his business. It also showed an appealing pint of beer.

Craft Brewer
Craft Brewer

I thought I should see if anyone else was talking about this so I typed into Google “federal beer tax decrease.” Google responded, “Did you mean to search for: federal beer tax increase.”

I think that tells the whole story. It is very unlikely, in this economic climate, that beer taxes will go down. It remains more likely that beer and other “sin” taxes would go up to help finance health care reform and other projects of the Obama administration.