WEEK 7 PDF - Business of Alcohol

Business of Alcohol - Alcohol, spirits, have traditionally been a business, found everywhere, society, civilization, fermenting into wine, beer etc, and exchanging it, and over broader territory - Also been political, exchange of the goods, use of the goods , and impact of th...

Business of Alcohol - Alcohol, spirits, have traditionally been a business, found everywhere, society, civilization, fermenting into wine, beer etc, and exchanging it, and over broader territory - Also been political, exchange of the goods, use of the goods , and impact of them The policies of spirits: two examples (political impact) - Gin was an early example of the impact of trade policy and unintended consequences in alcohol policy (control consumption) - Rum’s history and development has always been influential on politics Gin Craze - For many years, alcohol had been mixed with juniper berries and other herbs, both for flavouring and medicinal purposes - As people began to distil things into a purer spirit or alcohol they were used to add more flavorful and palatable - In the 16th century (1700) the dutch created the genever (gin), which combined wine and alcohol with not just juniper berries but other herbs, gaining popularity - Inexpensive to make and popular, but also political - William the third, King of England, from Holland (brings a taste for gin into the british market), placed large tariffs on French Brandy and wine (disturbed him, fighting with french all the time, people in england loved this, french make lots of money, even in wars, need to stop giving money and need domestic production), he also gave tax breaks to British distillers. - What else do they drink? Ale, beer, however, he introduces gin, makes it easy to produce gin - England is a wash in Gin, but don’t know how to drink it - They drank it like beer, so there was a lot of drunken people - Gin lane, lithograph (mother, mary, spends much of her money, baby falls, and dies, arrest and hang her) - Situation develops all over the country - Gin became very inexpensive (cheaper than beer) and was regularly abused - This led to backlash that included temperance movements (shouldn’t produce alcohol, prohibition) and new government licensing to control production - The gin act of 1751 is an example (make it hard to get a licence, become more expensive, go back to beer). - In the 1800’s gin recovered as a popular drink. In part because it was mixed with quinine water (bark of a tree) as an anti-malaria potion, to create a seltzer. This became gin and tonic. - British apart of the colonial system in hotter countries got malaria - Army navy service, need to take quinine all the time, but taste is trash, so they dumped it into gin. Convinced them - Became big in markets - Came from colonialism - Gin trap image Rum - Rum is distilled from malaysis, a by product of sugar manufacturing. Rose to popularity in the late 1600’s and especially in the 1700’s - Distilled it into rum - Large sugar plantations were created in both French and British colonies in the carribeans - These required cheap plentiful labour, which led to a dramatic increase in the importation of African slaves. Sugar and rum - New france Canada Louisbourg cape of breton, big french fortress, waste station in the colony - Parks canada took over the fortress and brought in a lot of rum and bottled it and shows the colonial system - Starting in 1731, if you were in the British navy, you were entitled to receive a daily pint of Jamaican rum for each man and a half (2 pints, 3 guys). - Americans couldn't drink on the ships - The sailor rum ration decreased over time, but the tradition lasted until the 1970’s. This was also true for the Canadian Navy - Caribbean islands - lots of rum - american colonies to produce rum - says no. very political - Rum remained political for much of its history - American producers were discouraged by the British and turned to whisky. Cuba - spanish colony (the political story, sugar plantations) - Bacardi had been a supplier of rum to spanish royalty from the 1880’s from facilities in cuba - Official rum of the spanish royal family - 20th century - tens, twenty, and thirties doing a lot of business with americans - Rum and coke called Cuba Libre which took on a different twist after the Cuban revolution (1950’s communist revolution, fedel castro takes over the government, overthrows the batista government) - After the revolution castro seized the distilleries (nationalized) - They have lost all their property in Cuba - The family fled to establish new facilities in Puerto Rico (American protected, diversified transfer their global operations) and other locations. they grew to become a huge Global producer of rum. - They have thrived but continue to seek compensation from Cuba (never forget, large cuban community US - Florida, NJ, have big influence) - Bacardi founder - facundo bacardi - No lessening of the embargo until they get the rum back (beef with cuba) Part 2 (restraint on trade) - Prohibition is the act of practice of forbidding by law the manufacturer, storage (weather in barrels or in bottles), transportation, sale, possession, and consumption of alcoholic beverages - Protecting Society of the evils of alcohol - danger to society  - Largely based on Protestant Church moral beliefs ( England the United States and Canada) but also an economic argument - drains away economic benefit (spend money on other things than booze) - Movement in Canada influenced by British and American examples - Largely a phenomenon of the Protestant movement in Quebec - Two major Canadian organisations in the 1800s, the dominance alliance, the total suppression of the liquor traffic, and the Woman's Christian Temperance Union (WCTU) - Prominent role for women tied to the suffrage movement (prohibition and women to vote in elections) - Negative effects of alcohol were put on women, husbands spending all their money, , only way to settle the problem, give women the vote to remove booze - Scott Act and Local Option - John A McDonald was not interested at all - Reformers liberals tended to be for this issue - In 1896 Wilfred Laurier's government had a large temperance segment. became the first French Canadian Prime Minister, the first liberal prime minister in quite some time did this by building a coalition between the English and Protestants and the French Canadian supporters. Had a large following in quebec. - However the French community completely opposed the prohibition - Laurier decided to hold a non-binding referendum - the results were close: 278,380 (51.3%) were in favor of prohibition 264,693 (48.7%) were against. every Province except Quebec saw a Yes vote but Quebec was over 80% against. - Only 43%/44% of people voted. - His first choice was to do nothing, but that wouldn’t hold, so he held a referendum and did nothing since the numbers showed that people didn’t care. - Seagrams, weizers employee great number of canadians WW1 in the role of the prohibition - In 1901 Prince Edward Island introduced the prohibition which would last until 1948. - The other provinces began to do so in World War 1. It was seen as patriotic and conserving food. Shouldn’t be wasting all the money on alcohol and wheat - Only Quebec did not - In March 1918 the federal government stopped the manufacturing and importation of liquor reforms to win the war - Loopholes for medicinal purposes - convince doctors - Na poo was soldier slang for no more Demon rum alcohol in the trenches - Most Canadian soldiers received the daily rum ration - loved it - Considered essential as a morale booster for men that were faced with death and living in horrendous conditions - Used for medicine all purposes - Ralph Bell The only consolation comes in rum jars - Introducing prohibition - however the soldiers are living it up with rum - Press the government of Robert Borden - Make them stop with the rum  - British government said no, workers saw no, they all said no - TIM COOK (best historian ww1) - New kernel - no alcohol - instead tea. - If they’re not having rum - won’t go in the trenches - Mutiny - death penalty - After the war the lack of success and eliminating alcohol and the idea that the enforcement was unbalanced and often unfair began to take hold. For some the idea that the state limited this right was an issue. - Criminal distribution also came to be seen as a problem (black market) - Less stealing and stuff - White people - nothing happens - Working class - people of colour - jail - Right to drink - soldiers can’t no more - Bootlegging idea - alcohol in sketchy bars, and sales. The americans - Prohibitions were successful in passing the 18th Amendment to the US Constitution in 1920. alcohol remained illegal until 1933 when the 21st amendment repealed the 18th, made it legal - Ken Burns in a PBS documentary said - On the whole the initial economic effects of the prohibition were largely negative. The closing of breweries distilleries and saloons led to the elimination of thousands of jobs and in turn thousands of more jobs were eliminated for Barrel makers truckers waiters and other related trades - Economic displacement - redistribution after - Big beer companies - soft drinks - History of labatt's Brewery (london brewery) notes that in Canada the impact on businesses were severe - The doors of 35 Ontario breweries had gone dark. across the nation, prohibition had a similarly devastating effect on the vibrant industry. the personal fortunes of many Brewers were lost, legacies vanished in hundreds of well-paying jobs disappeared - this was accentuated by the fact that the business of alcohol was simply driven underground into a black market and open the door to crime End of the prohibition: - In 1927 Ontario ended prohibition replacing it with government control - Overtime the laws became more liberal - For some years prohibition remained in the US making Canada tourist destination for American drinkers in the US a market for Smugglers from Canada - As we read in the bus kill article the solution Ontario was to create a Government monopoly on a distribution under the tight controls - The premier of Ontario Howard Ferguson stated that the Liquor Control Act was to allow people to exercise a god-given freedom under reasonable restrictions. - Ferguson was further quoted as seeing the purpose of the LCBO was to promote temperance, sobriety, personal liberty and above all to restore respect for the law - Evolution of LCBO  1947 cocktail bars 1958 the end of passports 1962 the end of passed cards Wine displays were allowed in the later 60s Marketing Brands and control in the alcohol industry - The global market controlled by small number of Multinational Enterprises - the largest, AB InBev had annual revenue of 45.6 billion US in 2017 - Forty Creek became part of an international conglomerate - Sea Groups also a leading MNE - Perfectly legal but overconsumption is a problem - In 2004, inBev was created through a merger of AMbev and interbrew, in amalgam of Latin American, Canadian, and European Brewery interests. - In 2008, Anheuer-Busch was acquired, and Acquisitions of Grupo Modela in 2012 in South Korea - Oriental brewing in 2014 helped International penetration. - In 2016 a merger was negotiated with African rival Sab Miller to create AB InBev. The AB InBev merger was the third largest in corporate history, establishing a dominant Market position out an estimated 1/3 of all beer sold worldwide - Sell beer and sweetened beer into the african market for women - Unlike many multinationals the growth of alcohol major companies is often driven by Heritage Brands and familiar names (budweiser, made in the Us, integrated in the British) - technology can be a factor but name recognition and tradition is more important - tensions between health and profit - The fact that alcohol is clear health implications - Governments want to control levels of consumption, mitigating the damage, but companies' profits rely on increased consumption. Selling to heavy drinkers. - Companies want to sell, but don’t want markets to get restricted - This is meant some level restriction on advertising in most countries - MNE’s can control some markets - most western countries and islamic countries can’t promote too much. - Restricted advertising - there are two methods countries can employ to limit advertising of alcohol - Voluntary codes of conduct from producers are one (drink responsibility, don’t drink and drive) - can go beyond voluntary - Restrictions by law or regulation is the other (what you may do or may not do to advertise your product) - Voluntary are much less effective than regulatory - Loi Evin: Frances regulation of alcohol marketing (Early 1990’s to control smoking and alcohol consumption - leaving things to voluntary creates a great deal of concern, health hazards) - High level of community and medical concern led to the adoption of legislation to prohibit advertising on television in cinemas and all sponsorship (like sports events or uniforms) - The advertising that is allowed in print media for adults and on some radio channels and billboards is restricted to information about the product, production, where it was made etc, no images of people of Lifestyle - No advertising should be targeted at Young people, no advertising is allowed on television and cinemas, and no sponsorship of cultural or sporting events is permitted - When advertising is permitted it is controlled. messages and images to refer only to the qualities of the products such as degree or composition means of production and patterns of consumption - A Health message must be included on each advertisement to the effect that alcohol abuses dangerous to health, must be posted at where you buy the drinks and smokes and on the bottle. - Law is still on the books - It was much more successful with Tobacco Control - because - Producers have lobbied to roll back some of the limitations - Multinationals and regulation 1. tensions between health concerns and drive for profits 2. smaller jurisdictions (non western) can find it hard to impose regulation due to the power of the MNE 3. even in larger restrictions lobbying can limit regulatory success - producers want to sell, big drinkers want to buy.