Blagnet.net

Michigan government tries to fix problems it caused

In recent months I have heard about two economic developments in Michigan that have been facilitated by the Michigan state legislature, to benefit the state’s struggling economy, which had been in its own mini-recession for years before the rest of the U.S. caught up. The legislature passed movie-filming tax breaks and loan incentives and revised liquor licenses for distilleries to help those industries out.

About the movie-making incentives:

Lawmakers seeking to give Michigan’s film business a boost could begin voting this week on a bipartisan package of lucrative tax and loan incentives backers say could quickly draw a dozen movie projects to the state.
[My understanding is that this already passed months ago. —JTP]

About the relaxed restrictions on liquor distilleries:

The new class of license would cost distilleries only $100 a year and is part of a larger proposal that would also allow distilleries to sell their products onsite and offer samples to visitors.

Currently distiller-only companies must pay $1,000 a year to distill liquor and sell their products through a third party. Wineries and breweries can obtain a more limited distillers’ license to produce fruit brandies and other spirits.

Ken Wozniak, director of executive services for the Liquor Control Commission, said Michigan is a “control state,” meaning the government acts as a wholesaler for distilleries. They must meet mandatory standards and sales quotas to sell to retailers and restaurateurs.

A distillery that doesn’t meet its quotas can sell only through the tasting rooms of its own wineries or breweries.

In other words, State restrictions are what limited the growth of these industries to begin with. Obviously getting rid of the original laws would help the companies more than passing wiser, more-tempered legislation would. At least these bills come close to reversing the original, harmful legislation.

Consider how many thousands of laws similar to these have been passed by every state and by Congress that hinder the growth of every single industry under the sun. Tax restrictions, distribution restrictions, wholesaling restrictions, quality/content restrictions, legal fees, and barriers to entry. All kinds of things you and I don’t even know about. These things all favor businesses that were good, lucky, and/or corrupt enough to become big and rich, and hurt small businesses and individuals. Furthermore, THEY DON’T BENEFIT ANYBODY! NO ONE IS PROTECTED BY SUCH IDIOTIC LEGISLATION! Well, okay, the politicians and their rich, well-connected supporters benefit. I guess that’s all that matters to our elected criminal class.

Hear what Lee Lutes, “a winemaker and winery manager at Black Star Farms in Suttons Bay,” has to say about the state’s restrictions on his and other distilleries:

Our biggest issue is that we are so small. This is primarily due to the types of products we make, which are 100 percent derived from fruit…. We initially asked the state to allow us to distill fruit, in conjunction with a winery license, to further support the fruit industry in Michigan.

We figured we could process enough fruit to, at least, support the industry, and who knows where it may have led? Now the state has basically cut the legs out from under us by creating minimum volumes of our products that must be sold to keep our place in the distribution channels—minimums that we will never meet because of our size.

This bill represents some positive developments to help turn this situation around.

In other words, the state never should have passed the original legislation to begin with, because it increased costs, decreased investment, provided barriers to entry for new, small businesses, and prevented companies from simply selling their customers what they wanted at prices they both agreed on.

Hat tip to Jacob Grier, guest-blagging at The Agitator, who prompted me to finally write about this and gave me some links to base my post around.