Craft Beer and the Human Economy
Tom Philpott observes that not all alcohol regulations need necessarily be a bad thing:
It’s true that Carter’s move on behalf of home brewers helped push along the craft-brew revolution, as did the state-by-state unwinding of rules preventing the opening of brew pubs, which largely happened in the 1980s and ’90s. But in both cases, the regulations in question were clearly misguided in the first place—they were remnants of Prohibition, designed to keep people from drinking at all. I join my libertarian friends in opposing clearly misguided, archaic regulations.
But even archaic regulations have their place. The most famous beer regulation of all is Germany’s illustrious Reinheitsgebot, or Purity Law, which governed that country’s beer production from 1516 until a slightly more expansive version came into effect in 1993. The Reinheitsgebot decreed that products marketed as beer could contain only the following ingredients: water, malted barley and hops. (Yeast was originally omitted, because in the 16th century, the role of microbiota in the fermentation process wasn’t understood.)
Granted, the Reinheitsgebot was always problematic. It prevented German beer makers from engaging in the kind of experimentation that took place in Belgium, home of delightful fruit-flavored beers that would have run afoul of the purity law.
But it saved German drinkers from the truly bad beer that plagues most of the globe. A 2006BBC story listed additives typically found in corporate beer, none of which you’ll find in the stuff brewed in Germany: betaglucanase, ammonia caramel, rhoiso-alpha acids, sulphur dioxide, protease, amyloglucosidase, propylene glycol alginate, and silicone. Nor will German beers ever be dumbed down with cheap filler grains like corn and rice, which are part of the reason American brews like Bud and Miller taste so insipid.
When we talk about regulation, I think it’s important to dissect the nature of the regulation itself. A regulation that simply requires beer to adhere to specific quality standards is pretty benign. Regulations that grant monopoly distribution rights, prohibit grocery stores from selling alcohol, and make it impossible for new entrants to make and/or sell their beer are harmful and stupid. Just saying regulation good! or regulation bad! won’t do. You have to explain why a regulation is useful, or why it causes harm.
Tom also comments on Yglesias’s piece on the union aspect of the big brewers versus the craft brewers. I think he misses the point Matt’s trying to make a bit. I don’t think Matt is cheering on the craft brewers because they don’t have unions. Rather he’s pointing out that unions are not necessarily an opposing force to big corporations, and supporting corporations just because they have a unionized labor force is not an inherently progressive thing to do. I would add to that point simply that small brewers tend to provide more options for workers in a more human, less industrialized setting. If workers at craft breweries wanted or needed to organize, more power to them.
Speaking of the “more human” aspect, I wrote yesterday at Forbes about something I’m tentatively calling the ‘Human Economy’. Here’s what I said:
Jobs are great, but welfare should be used to thwart the inherent economic uncertainty of a capitalistic, global society. People should not lose their insurance just because they’ve lost their job. Universal healthcare would go a long way toward allowing people to be more independent, more entrepreneurial, and less risk-averse in their private ambitions. I think that in the emerging service economy – with more and more people working outside of the normal constraints of office and industry jobs, as freelancers and contractors – this will become even more important. Far from discouraging work, the right kind of welfare can do just the opposite.
I’ll call it the Human Economy for lack of a better term, but I envision a world where the old status quo relationship between boss and worker is largely a thing of the past, where free markets and smart welfare programs and a green infrastructure combined with personal technology and peer-to-peer interactions create a truly vibrant, innovative economic future.
John Quiggin has an interesting post up on ‘feasible Utopias’ and he uses socialized healthcare as an example of such:
The big question is whether this model can be replicated more broadly. Health care has the special characteristics that, on the one hand, there isn’t a big issue of consumer preferences (mostly, people want the treatment that has the best chance of a cure, though there is sometimes a risk-return trade-off) and, on the other hand, markets perform very badly.
The public provision model wouldn’t work for, say, motor cars. Still, it seems that it ought to be possible to limit the domain of inequality in such a way that no one was left without the basic requirements for a decent life and social participation while, at the same time, those who chose to work harder, or worked more productively, could still enjoy higher consumption of discretionary items like expensive cars and granite benchtops.
I think some form of single-payer healthcare would go a long way toward freeing employees from the boss/worker relationship we now have, but it would also mean unions could focus more directly on wages and working conditions instead of bartering over benefits. Since health benefits are so expensive, this would lower the overall cost of running a union shop, making unions more viable in small outfits like craft brewers, but also less necessary. Maybe the unions wouldn’t do as much, but they could at least give those workers some agency and voice they might not otherwise have.
Which finally brings me to this comment that Benjamin Daniels left to a recent post of mine. Benjamin wrote:
Views like yours (which are quite close to mine) are what I like to describe as ‘market socialist’, the key features being:
1) Market mechanisms as effective allocation calculators, _if_ distortions and failures are removed. (Pigouvian neoliberalism when taken alone.)
2) Social/collective preferences as the highest goal of policy, _given_ that individual ‘revealed’ preferences are often incompatible with collective preferences. (ie, many of us would prefer not to have health insurance, but we are collectively better off if we all do – so a reduction in freedom on one hand increases freedom greatly on the other). This point also means that questions of distribution are at least equal to questions of total output; that employment is at least equal to profit, and other social preferences that are not reflected in market mechanisms are often more important than those that are.
Altogether the philosophical flow is the opposite of neoliberalism. There, what the market produces is proper _because it is said to reveal our preferences_; here, we reject that assumption, state our preferences first, and use markets to acquire the necessary information and enact those preferences.
Personally I have found that Post-Keynesian economics makes good use of these foundations – it has built a number of models where the key outputs are distribution and employment (instead of output and profit), and so illustrates how we can make the market mechanism produce the outputs we truly desire.