NCPA - National Center for Policy Analysis

Special Interest at Heart of CARE Act

July 28, 2011

The Competitive Enterprise Institute (CEI) recently released a report on the federal alcohol legislation --the so-called CARE Act -- that reveals the special interest nature of this legislation.  Rep. Jason Chaffetz (R-UT) offered the Community Alcohol Regulatory Effectiveness (CARE) Act (H.R. 1161) to reinforce a government-enforced three-tier system for distributing alcoholic beverages.  CEI's report explains in detail why the Act will harm consumers and alcoholic beverage producers, says Lee Doren, CEI's communications coordinator.

  • Through the CARE Act, wholesalers seek to reverse the pro-competitive effects of the U.S. Supreme Court's Granholm v. Heald decision.
  • That case struck down state laws that discriminate against out-of-state wineries for violating the Commerce Clause of the Constitution.
  • The CARE Act would allow states to pass laws restricting out-of-state alcoholic beverage sales as long as those laws do not "intentionally" discriminate against out-of-state producers.
  • In effect, it would allow state protectionist legislation as long as it is passed under some other pretext.

Source: Lee Doren, "CARE Act Undermines the Free Market and Constitutional Principles," Competitive Enterprise Institute, July 25, 2011.

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