Rules and policies should encourage competition in the American alcoholic beverage market, according to a new report issued by the U.S. Treasury Department.
The report is part of an executive order issued by President Biden in July, seeking greater competitiveness in different aspects of American commerce. Beer brewing in particular has seen a high degree of concentration, with almost two-thirds of sales coming from Anheuser Busch InBev and Molson Coors.
The Treasury report cited state and federal laws and regulations regarding the distribution and sale of alcohol that it says inhibit competition. One of these is the so-called “post and hold” law prevalent in several states, whereby wholesalers must make their prices publicly available. These were designed, in many cases, after the end of Prohibition by lawmakers who were hostile to alcohol consumption, to ensure that alcohol wouldn’t become too cheap. The report says these laws make consumers pay $487 million a year more for beer than they could, and drive up the price of a bottle of liquor by more than 30%.
"American consumers, small business owners, entrepreneurs, and workers should not have to suffer under the thumb of a highly concentrated beer industry," Assistant Attorney General Jonathan Kanter said in remarks quoted by Reuters.
The report suggested increased federal scrutiny of large proposed mergers, and a review by the states of the effects their regulations have on smaller producers.