While it was touched on a bit in last week's class, I left wondering how the laws of wine production, distribution and sale differ from that of other types of alcohol. Specifically, I wanted more clarity around what powers the federal government and states have to monitor distribution of other alcoholic beverages and take action when they deem something unsafe or anti-consumer.
After trying to come up with an example of this I've seen in the past, I thought of the well-known (and often mocked) anecdote around the once-popular alcoholic drink Four Loko (and most people who read this post will start laughing and stop reading right about here). Four Loko is a very sweet, sparkling alcoholic beverage probably best known by younger drinkers and often purchased in convenience stores. It received quite a bit of press for mixing high quantities of alcohol with caffeine and taurine. This mixture was so problematic and dangerous that the beverage was banned by the FDA in 2010. Soon after modifying the recipe to remove caffeine and taurine, Four Lokos were available again but saw their sales numbers diminished greatly.
While a ban of this sort is made out of safety concerns which don't directly compare with the type of free speech or monopoly concerns we discussed last week, the Four Loko history is worth remembering. While I myself have never had a Four Loko, I can understand why many consumers were angry over the ban of the old recipe. They argued that this ban was anti-consumer and that they should be allowed to willingly choose what type of alcoholic beverages to enjoy. Additionally, one could argue that the same effects as the old Four Loko can easily be achieved by drinking the new Four Loko with any energy drink bought at the same convenience stores. Therefore, there's an argument to be made that the FDA's ban does not necessarily increase general consumer safety but also violates consumers' right to choose.
Obviously Four Loko doesn't compare great with wine, but in light of the conversations we had last week I think that this sort of federal oversight and regulation is an interesting anecdote to keep in mind when surveying the wine industry today.
https://newyork.cbslocal.com/2010/11/16/schumer-feds-may-move-to-ban-alcoholic-energy-drinks/
http://www.cnn.com/2010/HEALTH/11/17/alcohol.caffeine.drinks/index.html?hpt=C1
https://www.chicagotribune.com/news/ct-xpm-2009-08-24-0908230370-story.html
Wednesday, January 23, 2019
Pisco's True Origin
I have a personal issue with origin appellations since there is a big dispute over the origin of Pisco. If you talk to any Peruvian person (like myself), you will notice pride in our voices when we call Pisco our flagship drink. However, if you ask a Chilean, you might hear them say that Pisco is theirs. After reading the case on Domain Barons de Rothschild, it left me thinking what is the difference between Bordeaux and Pisco, and why there is no doubt about Bordeaux Origin Appellation unlike Peruvian Pisco. After all, we also have a region called Pisco where the grapes to make it grow.
I still haven't found the answer. I think we were slow in the global scene to claim Pisco as our own - maybe we didn't think we needed to do it. Only in some regions like EU and recently India, Peru has the Origin Appellation for Pisco and Chilean drinks aren't legally allowed to be called with that name. This article details how after a 9 year dispute, we recently got the Origin Appellation in India: https://elcomercio.pe/economia/peru/chile-podra-denominacion-origen-pisco-india-litigio-peru-noticia-596331
If you are curious about the topic, here is a more unbiased article that mentions a dispute in Australia about Pisco where we don't have the Origin Appellation:
https://www.abc.net.au/news/2018-08-19/winemaker-in-battle-with-peru-over-use-of-the-name-pisco/10133394
Barriers to Entry
In college, there was a craze known as "Sweet Tea Vodka." Created by a liquor salesman and a part-time vintner in South Carolina, Firefly tasted liked sweet tea - it went down easily. However, it also had the same alcohol content as its vodka base - it took you down easily. Many people fell prey to the sweet, almost syrupy charm, of this ingenious concoction that was as friendly to your face as its southern roots would imply and as dangerous as a Myrtle Beach firecracker stand on the Fourth of July.
I interned for Firefly. Up until that point, the only industries I had been exposed to had been the law, finance and the travel company my mom worked for. I had never seen the liquor industry. It was much to my surprise (and delight) when my first meeting with my new boss involved the tasting of the new flavors of Firefly. Men dressed in jeans swapped stories about golf and family while tasting the new Raspberry, Peach and Mint flavors. There was little talk of actual business.
On my first tag along sales call, I realized that business talk was still noticeably absent. As I shadowed my boss across the bars of downtown Nashville, we took shots (before noon) with the bartenders on Broadway and swapped more stories about golf and family and drinking.
I did notice a pitch that was subtly delivered, about the same time I noticed that we were the only group authorized to sell Firefly in the region. At the time I didn't grasp how unique it was that the distributor I was working with had no competition in selling a product that they didn't create. They also had very little competition in selling alcohol at all. There were some other groups that they "competed" with, but their hardest sell wasn't convincing the bartenders to place an order for alcohol from them. It was simply to convince them of new products that they were licensed to sell. They were effectively operating in a competition-free market.
As we listened to the problems with regulation of alcohol in class, I remembered my internship and immediately understood why incumbents would be so loathed to open up these regional monopolies. If I'm on the only lemonade stand in town, why would I want to you buy lemonade through the internet, even if it might be more what you want? I also realized why having strong legal representation would be so crucial for this fight, along with having the proper allies in the statehouse.
I believe that disruption will occur, the same way Uber was able to change the paradigm in the taxi monopolies. However, I also understand that it will not be solely on the desirability of the wine being sold, but rather through the clever business plans and aggressively creative legal and political actions of disruptors.
I interned for Firefly. Up until that point, the only industries I had been exposed to had been the law, finance and the travel company my mom worked for. I had never seen the liquor industry. It was much to my surprise (and delight) when my first meeting with my new boss involved the tasting of the new flavors of Firefly. Men dressed in jeans swapped stories about golf and family while tasting the new Raspberry, Peach and Mint flavors. There was little talk of actual business.
On my first tag along sales call, I realized that business talk was still noticeably absent. As I shadowed my boss across the bars of downtown Nashville, we took shots (before noon) with the bartenders on Broadway and swapped more stories about golf and family and drinking.
I did notice a pitch that was subtly delivered, about the same time I noticed that we were the only group authorized to sell Firefly in the region. At the time I didn't grasp how unique it was that the distributor I was working with had no competition in selling a product that they didn't create. They also had very little competition in selling alcohol at all. There were some other groups that they "competed" with, but their hardest sell wasn't convincing the bartenders to place an order for alcohol from them. It was simply to convince them of new products that they were licensed to sell. They were effectively operating in a competition-free market.
As we listened to the problems with regulation of alcohol in class, I remembered my internship and immediately understood why incumbents would be so loathed to open up these regional monopolies. If I'm on the only lemonade stand in town, why would I want to you buy lemonade through the internet, even if it might be more what you want? I also realized why having strong legal representation would be so crucial for this fight, along with having the proper allies in the statehouse.
I believe that disruption will occur, the same way Uber was able to change the paradigm in the taxi monopolies. However, I also understand that it will not be solely on the desirability of the wine being sold, but rather through the clever business plans and aggressively creative legal and political actions of disruptors.
Tuesday, January 22, 2019
For Better or For Worse
“One raw jalapeño and a PBR tallboy, please.”
That was my recent order at Davanza’s, a “laid back bar and eatery” in downtown Park City. Or at least, my order as dictated to me by the helpful Davanza server.
This past weekend’s ski trip provided an impeccable opportunity to do some very thorough first-hand, real-world research into Utah’s quirky alcohol laws that we discussed last class.
As I discovered, Davanza’s has a “Limited-Service Restaurant” alcohol license - which, among other restrictions, requires there to be food on the table before alcohol can be served. Hence one jalapeño.
Fortunately for Davanza’s, we proceeded to order very much pizza - as their LSR license also requires 70% of their revenue to come through the sale of food.
Unfortunately for me, my PBR was no typical PBR. This PBR, as indicated in fine print on the top of the can, was a lowly 4.0% ABV, a far cry from its usual 4.7%. According to Utah law, “beer” must have less than 3.2% alcohol-by-weight, or 4% ABV, and anything higher is even more strictly regulated. In the case of PBR, this means drinking 6 Utah beers for every 5 “standard” beers to achieve the intended effect, a challenge I readily accepted in the name of science.
Utah liquor laws have rapidly liberalized in the past few years. If we had visited prior to 2017, our drinks at restaurants like Davanza’s would have been prepared behind a “Zion curtain” - a 7-foot-high sheet of frosted glass that hides the ever-tempting alcohol from our debaucherous view.
This Zion curtain law was repealed in 2017, but replaced with a new law requiring establishments with a bar and restaurant in the same building to have them in different “rooms” - begging a definition of “room,” and prompting the awkward floor plans that we found at the High West “Distillery & Saloon” and Collie’s “Bar & Grill.”
Utah liquor laws are a Byzantine quagmire of prohibitions and comical loopholes. But they are hardly unique.
Walk through a Las Vegas casino, and you’ll find a wide walkway of colored carpet guiding you from one end of the casino floor to the other. Under-21-year-olds must remain on this carpet and cannot wander between the rows of tables and slot machines, and if they linger a bit too long they’ll be told to get a move on by a security guard.
Try to buy cigarettes in San Francisco, and you’ll find they’re locked up behind the counter, requiring a clerk’s help to access them.
Buy a 12-oz can of Coke in Berkeley, and you’re contributing an extra 12 cents to the general fund of the City of Berkeley, thanks to the “soda tax.”
Regulation in the name of public health is hardly unique to Utah, or to the alcohol industry. We know gambling is addictive. We know smoking causes cancer. We know sugary drinks lead to obesity and diabetes. And so we create regulations, some more misguided than others, to curb these harms for the greater good.
We have known of the negative effects of alcohol, or gambling, or tobacco for decades, if not millenia. But more recent inventions call into question our government’s role and ability to react to threats to public health.
As of recently, we now know Facebook usage leads to depression. We now know mobile game addiction is real, and can lead to significant costs for those afflicted. We now know that phone notifications trigger a dopamine feedback loop not unlike that created by the flashing lights of a slot machine, causing us to crave more.
Tech companies explicitly design their products to be addictive - or in tech terminology, to “maximize user engagement.” Indeed, there are only two types of product-sellers that refer to their customers as “users” - tech companies, and drug dealers.
Yet unlike drug dealers, or alcohol companies, or tobacco companies, these tech giants can run thousands of experiments a day, tweaking features in real-time to maximize this addiction, and personalize the appeal of their product to each individual user. The power of A/B tests and machine learning to create addiction far outstrips the ability of our human brain to adapt to and discount these new stimuli. Where gambling may take our wallets, alcohol may take our livers, smoking may take our lungs - consumer tech may be taking our minds.
There is a lot we can learn from effective - and ineffective - regulation of the alcohol industry to apply to emerging new industries that pose a threat to public health. Will we see small-but-steady curbs to the worst excesses, designed by knowledgeable insiders? Or will we see a sea-change backlash to tech’s influence on life and democracy, followed by a tech version of Prohibition?
I vote, at the very least, that you should have to eat a raw jalapeño before you can send your spicy take of a Tweet.
That was my recent order at Davanza’s, a “laid back bar and eatery” in downtown Park City. Or at least, my order as dictated to me by the helpful Davanza server.
This past weekend’s ski trip provided an impeccable opportunity to do some very thorough first-hand, real-world research into Utah’s quirky alcohol laws that we discussed last class.
As I discovered, Davanza’s has a “Limited-Service Restaurant” alcohol license - which, among other restrictions, requires there to be food on the table before alcohol can be served. Hence one jalapeño.
Fortunately for Davanza’s, we proceeded to order very much pizza - as their LSR license also requires 70% of their revenue to come through the sale of food.
Unfortunately for me, my PBR was no typical PBR. This PBR, as indicated in fine print on the top of the can, was a lowly 4.0% ABV, a far cry from its usual 4.7%. According to Utah law, “beer” must have less than 3.2% alcohol-by-weight, or 4% ABV, and anything higher is even more strictly regulated. In the case of PBR, this means drinking 6 Utah beers for every 5 “standard” beers to achieve the intended effect, a challenge I readily accepted in the name of science.
Utah liquor laws have rapidly liberalized in the past few years. If we had visited prior to 2017, our drinks at restaurants like Davanza’s would have been prepared behind a “Zion curtain” - a 7-foot-high sheet of frosted glass that hides the ever-tempting alcohol from our debaucherous view.
This Zion curtain law was repealed in 2017, but replaced with a new law requiring establishments with a bar and restaurant in the same building to have them in different “rooms” - begging a definition of “room,” and prompting the awkward floor plans that we found at the High West “Distillery & Saloon” and Collie’s “Bar & Grill.”
Utah liquor laws are a Byzantine quagmire of prohibitions and comical loopholes. But they are hardly unique.
Walk through a Las Vegas casino, and you’ll find a wide walkway of colored carpet guiding you from one end of the casino floor to the other. Under-21-year-olds must remain on this carpet and cannot wander between the rows of tables and slot machines, and if they linger a bit too long they’ll be told to get a move on by a security guard.
Try to buy cigarettes in San Francisco, and you’ll find they’re locked up behind the counter, requiring a clerk’s help to access them.
Buy a 12-oz can of Coke in Berkeley, and you’re contributing an extra 12 cents to the general fund of the City of Berkeley, thanks to the “soda tax.”
Regulation in the name of public health is hardly unique to Utah, or to the alcohol industry. We know gambling is addictive. We know smoking causes cancer. We know sugary drinks lead to obesity and diabetes. And so we create regulations, some more misguided than others, to curb these harms for the greater good.
We have known of the negative effects of alcohol, or gambling, or tobacco for decades, if not millenia. But more recent inventions call into question our government’s role and ability to react to threats to public health.
As of recently, we now know Facebook usage leads to depression. We now know mobile game addiction is real, and can lead to significant costs for those afflicted. We now know that phone notifications trigger a dopamine feedback loop not unlike that created by the flashing lights of a slot machine, causing us to crave more.
Tech companies explicitly design their products to be addictive - or in tech terminology, to “maximize user engagement.” Indeed, there are only two types of product-sellers that refer to their customers as “users” - tech companies, and drug dealers.
Yet unlike drug dealers, or alcohol companies, or tobacco companies, these tech giants can run thousands of experiments a day, tweaking features in real-time to maximize this addiction, and personalize the appeal of their product to each individual user. The power of A/B tests and machine learning to create addiction far outstrips the ability of our human brain to adapt to and discount these new stimuli. Where gambling may take our wallets, alcohol may take our livers, smoking may take our lungs - consumer tech may be taking our minds.
There is a lot we can learn from effective - and ineffective - regulation of the alcohol industry to apply to emerging new industries that pose a threat to public health. Will we see small-but-steady curbs to the worst excesses, designed by knowledgeable insiders? Or will we see a sea-change backlash to tech’s influence on life and democracy, followed by a tech version of Prohibition?
I vote, at the very least, that you should have to eat a raw jalapeño before you can send your spicy take of a Tweet.
Bizarre drinking laws in the US
Our discussion in class of the stringent wine regulation in Utah got me thinking that there must be some other peculiar laws out there, and with a quick Google - there are a ton! Some of them make you wonder what must have happened for the law to have to be written in the first place (Missouri / North Dakota / Ohio)! Here are a select few standouts:
Alaska - It is illegal to be drunk in a bar (either upon entering or exiting)
Arkansas - If you are caught with alcohol between the ages of 18 and 21, you must write a themed essay on liquor, wine or beer as part of the punishment
Hawaii - It is illegal to have more than one alcoholic beverage in front of you
Indiana - It is illegal for grocery stores and convenience stores to sell cold beer (only liquor stores can)
Missouri - It is illegal in one part of the state to provide beer to elephants and it is illegal in St. Louis to sit on the curb of any city street and drink beer from a bucket
Nebraska - It is illegal to have any physical contact or PDA with a bartender
New Jersey - If you get a DUI, you are not allowed to get a vanity license plate
North Carolina - NO HAPPY HOURS!
North Dakota - It is illegal to serve beer and pretzels at the same time
Ohio - It is illegal to give alcohol to a fish
Texas - If you are standing up, you can legally only take three sips in a row before having to sit back down
Be careful out there, it's a minefield!
Source: https://craftbeerclub.com/blog/post/weird-drinking-laws-in-our-50-states
Alaska - It is illegal to be drunk in a bar (either upon entering or exiting)
Arkansas - If you are caught with alcohol between the ages of 18 and 21, you must write a themed essay on liquor, wine or beer as part of the punishment
Hawaii - It is illegal to have more than one alcoholic beverage in front of you
Indiana - It is illegal for grocery stores and convenience stores to sell cold beer (only liquor stores can)
Missouri - It is illegal in one part of the state to provide beer to elephants and it is illegal in St. Louis to sit on the curb of any city street and drink beer from a bucket
Nebraska - It is illegal to have any physical contact or PDA with a bartender
New Jersey - If you get a DUI, you are not allowed to get a vanity license plate
North Carolina - NO HAPPY HOURS!
North Dakota - It is illegal to serve beer and pretzels at the same time
Ohio - It is illegal to give alcohol to a fish
Texas - If you are standing up, you can legally only take three sips in a row before having to sit back down
Be careful out there, it's a minefield!
Source: https://craftbeerclub.com/blog/post/weird-drinking-laws-in-our-50-states
Monday, January 21, 2019
When Anna Karenina drinks
Our Domaines Barons de Rothschild case's Appendix A note on Russia as an emerging area of consumption caught my interest. The case states: "One commonality in areas of growing consumption was the association of wine with status."
As of 2017, wine is a nearly $700M market in Russia. I'm curious as to how wine evolved alongside culture and status in Russia's storied history. As a literary enthusiast, I thought a prime lens through which to analyze this topic was literature, and where better start than Tolstoy's Anna Karenina, published in 1877, a crown jewel of Russian -- and world -- literature. (Also definitely not coincidentally one of my most beloved classics).
Anna Karenina depicts the downfall of Karenina, a countess in Imperial Russia, as she delves into an extramarital affair that challenges the boundaries of high Russian society and ultimately leads to her suicide. One of the most famous passages in Anna Karenina evokes wine's intersection with both high class in Russia and romantic enchantment.
Upon meeting the man with whom she will eventually have an affair, "Anna was drunk with the wine of the rapture she inspired... the tremulous, flashing light in her eyes, the smile of happiness and excitement that involuntarily curved her lips, and the precise gracefulness, assurance, and lightness of her movements... 'No, it's not the admiration of the crowd she's drunk with, but the rapture of one man'" (Tolstoy 176).
Tolstoy wields wine as an immensely powerful metaphor in this timeless excerpt. At the high society event where Anna meets her lover, she is drink with wine and the rapture of her extramarital suitor. Here, Tolstoy strikes an unflinching parallel between wine and raw romanticism.
There is something fearlessly tangible about this connection between wine and desire, suggestive of a greater historical high Russian societal association of wine with pleasure, status, and privilege.
As of 2017, wine is a nearly $700M market in Russia. I'm curious as to how wine evolved alongside culture and status in Russia's storied history. As a literary enthusiast, I thought a prime lens through which to analyze this topic was literature, and where better start than Tolstoy's Anna Karenina, published in 1877, a crown jewel of Russian -- and world -- literature. (Also definitely not coincidentally one of my most beloved classics).
Anna Karenina depicts the downfall of Karenina, a countess in Imperial Russia, as she delves into an extramarital affair that challenges the boundaries of high Russian society and ultimately leads to her suicide. One of the most famous passages in Anna Karenina evokes wine's intersection with both high class in Russia and romantic enchantment.
Upon meeting the man with whom she will eventually have an affair, "Anna was drunk with the wine of the rapture she inspired... the tremulous, flashing light in her eyes, the smile of happiness and excitement that involuntarily curved her lips, and the precise gracefulness, assurance, and lightness of her movements... 'No, it's not the admiration of the crowd she's drunk with, but the rapture of one man'" (Tolstoy 176).
Tolstoy wields wine as an immensely powerful metaphor in this timeless excerpt. At the high society event where Anna meets her lover, she is drink with wine and the rapture of her extramarital suitor. Here, Tolstoy strikes an unflinching parallel between wine and raw romanticism.
There is something fearlessly tangible about this connection between wine and desire, suggestive of a greater historical high Russian societal association of wine with pleasure, status, and privilege.
Can We Stop Worrying About Sulfites?
As someone who spends way too much time scrolling through the feeds of Instagram wellness bloggers, has more than one friend who rotates between the trendiest elimination diets, and who adopts a fringe diet herself, I've come across a fair share of people avoiding sulfites. This left me to wonder, what are sulfites and should I actually be worried about them?
Sulfites (sulphur dioxide, SO2, a compound made up of sulfur and oxygen) are a naturally-occurring compound found in wine. In addition to being naturally occurring, sulfites are produced in labs and added as a preservative in many foods. Winemakers use sulfites in this way; sulfites preserve the flavor of a wine, allowing it to age without turning to vinegar.
Sulfites are naturally created during fermentation, so even wines labeled as "sulfite-free" have sulfites. Any bottle of wine containing more than 10 parts per million (ppm) of SO2 must be affixed with a "contains sulfites" label, so you can effectively consider the "sulfite-free" label to mean "no added sulfites." In the United States the legal limit for sulfites is 350 ppm, with most wines ranging between 30-120 ppm. The maximum for US organic certified wines is 100 ppm.
Sulfites are anecdotally accused of causing headaches, but there haven't been scientific studies that back this up. One 2014 study did not find a decreased prevalence of headaches in those who drank organic low-sulfite wines when compared to those who drank traditional wines. If you get a headache from wine, it most likely has to do with dehydration or the quantity of wine consumed, not the sulfite content.
Lastly, the level of sulfites in other common foods far exceeds those in wine. Dried fruits sometimes reach sulfite levels of over 1,000 ppm. Other foods with higher sulfite content include chips, french fries, and pickles.
If you're really worried about sulfites, instead of buying an $80 sulfite remover, just choose a chocolate chip cookie over an oatmeal raisin one.
Sources:
https://www.bonappetit.com/drinks/wine/article/sulfite-free-wine
https://www.scientificamerican.com/article/myths-about-sulfites-and-wine/
https://www.wired.com/2015/06/wine-sulfites-fine-heres-remove-anyway/
https://www.decanter.com/learn/wine-terminology/sulfites-in-wine-friend-or-foe-295931/
https://www.thekitchn.com/the-truth-about-sulfites-in-wine-myths-of-red-wine-headaches-100878
https://www.shape.com/healthy-eating/healthy-drinks/are-sulfites-wine-bad-your-health
Sulfites (sulphur dioxide, SO2, a compound made up of sulfur and oxygen) are a naturally-occurring compound found in wine. In addition to being naturally occurring, sulfites are produced in labs and added as a preservative in many foods. Winemakers use sulfites in this way; sulfites preserve the flavor of a wine, allowing it to age without turning to vinegar.
Sulfites are naturally created during fermentation, so even wines labeled as "sulfite-free" have sulfites. Any bottle of wine containing more than 10 parts per million (ppm) of SO2 must be affixed with a "contains sulfites" label, so you can effectively consider the "sulfite-free" label to mean "no added sulfites." In the United States the legal limit for sulfites is 350 ppm, with most wines ranging between 30-120 ppm. The maximum for US organic certified wines is 100 ppm.
Sulfites are anecdotally accused of causing headaches, but there haven't been scientific studies that back this up. One 2014 study did not find a decreased prevalence of headaches in those who drank organic low-sulfite wines when compared to those who drank traditional wines. If you get a headache from wine, it most likely has to do with dehydration or the quantity of wine consumed, not the sulfite content.
Lastly, the level of sulfites in other common foods far exceeds those in wine. Dried fruits sometimes reach sulfite levels of over 1,000 ppm. Other foods with higher sulfite content include chips, french fries, and pickles.
If you're really worried about sulfites, instead of buying an $80 sulfite remover, just choose a chocolate chip cookie over an oatmeal raisin one.
Sources:
https://www.bonappetit.com/drinks/wine/article/sulfite-free-wine
https://www.scientificamerican.com/article/myths-about-sulfites-and-wine/
https://www.wired.com/2015/06/wine-sulfites-fine-heres-remove-anyway/
https://www.decanter.com/learn/wine-terminology/sulfites-in-wine-friend-or-foe-295931/
https://www.thekitchn.com/the-truth-about-sulfites-in-wine-myths-of-red-wine-headaches-100878
https://www.shape.com/healthy-eating/healthy-drinks/are-sulfites-wine-bad-your-health
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