Friday, March 7, 2008

A Reply to a Response

A few months back (in December) I was invited to write an op-ed piece for the Capital Region Business Journal regarding the self-serving Senate Bill 224, aka The Great Dane Bill. I thought my article took a reasoned stance against the bill. I essentially argued that this was specialty legislation of the worst kind: passed with hardly a debate and appended to a budget bill in a manner that could only generously be considered questionable.

In March, the Capital Region Business Journal published a response to my article by Mr. Eliot Butler, president of The Great Dane. It takes him no less than two sentences to attack: "Unfortunately, the article ignores the merits of the bill and the growth opportunity it provides for Wisconsin brewpubs and instead reports inaccurate information based on insincere rhetoric spread by opponents of the bill." As for the first point, it was an editorial - by its very nature it only took one side of the issue - that was my assignment; if you would like a full, bipartisan discussion of this issue you can see the numerous posts published here. However, while I generally welcome healthy debate - for there is much to debate about this (despite the lack of debate by our legislators in actually PASSING this bill) - I do not welcome being called "insincere" or my hard work in researching this issue passed off as "inaccurate."

Unfortunately, it appears that Mr. Butler is too quickly dismissive of his opposition:

1) "The December article that ran in this publication (which, is sort of like being referred to as "that guy" when you are standing in the room and is rudely dismissive, thank you very much) reported the popular myth that the new law would rob traditional, non-brewpub breweries in the state of their ability to sell food at retail to visiting guests if they produce more than 10,000 barrels annually."

I'm somewhat concerned by the phrase "popular myth" because this is exactly what the legislation does. No brewery producing over 10,000 barrels of beer annually, under the new law, can sell food at retail. It's that simple.

"The new law has absolutely no impact on traditional breweries currently operating in Wisconsin." (emphasis mine) 

Ah, well. That's something entirely different and takes my entire article completely out of context and shows a gross misunderstanding of my arguments. I never once said it would impact Wisconsin breweries as they currently exist. My arguments are entirely future looking (admittedly, I used Ale Asylum as an example, but only for point of reference of a "traditional brewery" that actively leverages its pub facilities).

But there is some pause here, as we consider Mr. Butler's statement, because even it is not entirely forthright. For example, yes, there is to be a "grandfather clause" included in this legislation so that any brewery currently in existence will continue to operate under the old rules (if it chooses). But the scope of this grandfather clause is very much in dispute. It has been suggested by some that merely changing corporate structure, or being bought out, or buying out another brewery would negate the grandfather clause and thus pull a current brewery within the aegis of the new law.

Second, Mr. Butler entirely misses the point: the legislation prohibits this business model for future breweries looking to open in the state of Wisconsin. If someone were considering opening a brewery and brewpub, one in the vein of Great Lakes Brewing Company, Goose Island, Two Brothers, Bear Republic, or scores of other world-renown breweries and brewpubs that compete for sales in the state of Wisconsin, it would not be possible. There is an active disincentive to invest in world-class (or even best-in-region) food service. Of course this is convenient for Mr. Butler, but seriously hampers the options of future brewers in this state and negatively impacts the abilities of future breweries to compete with breweries in just our own region, let alone nationally or globally. In fact, given this strong disincentive, why not just open your brewery/brewpub in Rockford, Illinois or Dubuque, Iowa and ignore the question entirely; such a brewery could advertise to consumers in Wisconsin and distribute here without having to deal with the hassles of our protectionist legislation. This is the alternative that Mr. Butler's legislation provides. 

2) As for sincerity, let's ask the ambitious Mr. Butler a question. Mr. Butler, at your current rate of growth (2000+ barrels per location) you will reach the 10,000 barrel limit before you reach a sixth location. What will you do then?

Well, his answer must one of two, he must say either:

     a) Sir, I promise that I will stay within the letter of the law and I will be content to have my five locations in the state of Wisconsin and call it a day; or,

     b) Sir, this situation is entirely temporary, and I fully intend to keep working with the brewing community to develop a solution that will allow reasonable expansion of brewpubs and yet allow flexibility to our more traditional brewing industry. In the next few years we will be working with the Brewers Guild to propose new legislation that will remove these hard caps and/or permit traditional breweries to allow some form of food service in their breweries, regardless of size.

While pondering which of these you think most closely matches Mr. Butler's "sincere" response, keep in mind that the obvious consequence of (A) is that Mr. Butler looks to continue growing outside of the state of Wisconsin and thereby removes potential tax dollars and employment from this state. Is this really in the best interests of the breweries and consumers in the state of Wisconsin? (maybe, if one were to have a negative opinion of Mr. Butler's beer, it would be). And, in considering (B) look at the need Mr. Butler has for changing the law he spent so much time and money to develop (i.e., none).

Look. I am in no way saying that the old law was good; it was crap. But the new law isn't any better (for anyone other than the Great Dane) and seriously impedes the ability to create a truly workable and reasonable solution. Really, I wouldn't have a problem with this law, if it had been the result of a legitimate legislative process; but it was hastily attached to an overdue budget in the hopes of sneaking it in so that Hilldale could be up and brewing in time for the busy holiday season. And, really, I wouldn't even have a problem with that, if Mr. Butler would call a spade a spade and just say "Hey! We didn't care about the future impact of this bill to anyone other than ourselves. We presented a bill that is in our best interests and sucks to be you." I'm OK with that - it is the legitimate marriage of capitalism and modern politics - but only if he admits to it instead passing off his insincere rhetoric as being in the best interests of the Wisconsin brewing industry and the Wisconsin consumers. Nobody is going to begrudge modern business a selfish self-interest; but it seems insincere and inaccurate to deny it.

By the way, you can read my interview with Mr. Butler about this very issue, here.


  1. Miller is a traditional brewery currently operating in Wisconsin.

  2. The new law absolutely impacts existing breweries. Ask Lake Louie if they can open a brewpub?

  3. Since you mentioned this law in your newest post...what about Fox River Brewing Co.? They were blocked by the old law from serving their own beer at 2 or 3 locations.


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