I mean, there's more to it than that. A friend of mine is a prominent head brewer in the Denver area, and a couple weekends ago we cranked the numbers and figured out that the cans for hard seltzer are more expensive than the contents (aka the actual drink) from a BoM perspective. A labeled can is something like 14 cents, and the contents were something 10 cents. For a can of beer, the contents are closer to 50 cents.
The margins are just stupid good. Apparently Upslope brewing here already makes more profit on their seltzer than all of their beer.
The same type of margins apply to vodka and gin vs aged spirits like whiskey, whisky, and to a lesser extent tequila and rum. No warehousing, no barrels, no forecasting demand a decade out, etc.
If you love booze, you make beer/whiskey/tequila. If you love money you make vodka.
What's crazy to me (also in the Denver area) is that the national brands (White Claw, Truly) are the same price as the local craft brewer's offerings (Upslope's Spiked Snowmelt, Oskar Blue's Wild Basin).
The national brands have to be making an absolutely massive profit on these.
There are commercial scale providers of bulk alcohol that is taxably considered beer. It's not quite as cheap as neutral grain spirits, but ours definitely a lot cheaper then brewing it.
> Because White Claw is brewed like beer, it’s taxed like beer, which is important because beer is taxed in the U.S. at a much lower rate than spirits. If you made a product similar to White Claw by mixing vodka with seltzer and putting it in a can, a six-pack would be subject to almost $2 in additional taxes when sold in New York City.
Important takeaway from the article. This also answers my own question as to why drinks like Mike's Hard, Smirnoff Ice, etc are malt beverages. Hopefully the sugar base instead of a grain base catches on for new drinks.
IIRC this tax law pretty much single handedly ended the Zima and wine cooler fad in the nineties, since it made those products financially unviable. They were popular for a reason, so I share NYT’s sentiment on the white claw craze being practically overdue and your expectation it’s only the first of many packaged drinks like this.
That doesn't sound right. I believe spirits have been higher-taxed than beer/wine, in most places, since long before the 90s. And, Zima, as a "malt beverage", would seem to have qualified for the same beer-like treatment as White Claw today.
I cant find an exact answer, but combining the ideas that: the metabolic pathways for ethanol take precedence over the metabolism of other food components, leading to fat conversion and storage of higher-kcal foods than would be expected if the energy for metabolism was not diverted to the alcohol; the extra energy needed to metabolize alcohol should become a net drain on energy reserves; and alcohol is almost never fully metabolized, but rather excreted as acetic acid - I think it is safe to assume that an ethanol calorie actually provides the body very little energy AND if youre not eating while you are drinking there isnt a way for the body to store the energy as fat for later.
If you add up the average consumption of alcohol for an American in a year, the difference between 100 calories per unit and 145 calories per unit amounts to something like an additional 45-60 minutes of exercise per week to offset. There’s a lot of variables there, so it could potentially be more or less, but it’s non-trivial.
Rhum agricole and cachaça are made from sugar-cane juice. That's not as pure as refined sugar, but it makes a much cleaner spirit than molasses.
The bigger difference between White Claw and rum, i would say, is that rum is distilled, whereas White Claw is only fermented. I'm not sure there are any traditional non-distilled drinks made from sugar, and Wikipedia is down so i basically have no way to fake being well-informed as i usually do.
I'm not a liquor expert by any means, but I believe cachaça is made with sugar cane juice and is considered a type of rum. Or maybe a close relative of rum.
One thing that seems to be often overlooked is that yeast do not simply convert sugar into ethanol. They require nutrients and will produce different compounds(Google tryptophol) if a nutrient runs out and prevents complete metabolism.
> A problem with malternatives has been the need to find ways to mask the beer-like flavor that results from brewing. To that end, these drinks have added sugar and strong citrus flavors, which a lot of consumers like.
Nice! Our tax laws encourage companies to make less palatable goods that then require more added sugar to compensate thus upping everyone's carbohydrate intake without it actually tasting as good as those carbs would be in a cake or some such. How wonderful! /s
Cheap carbohydrates keep us fed and happy. What if I told you that not everyone needs to look like a fitness model to live a reasonably content existence?
>Nice! Our tax laws encourage companies to make less palatable goods....
If we were talking about California compliant semi-auto rifles everyone here would be all happy that the law makes them suck. I'm sure some "religion enthusiast" in North Carolina is happy that the law makes malt beverages suck.
Not just taxes, but being "beer" allows it to be sold in grocery stores and corner stores where a drink made from distilled spirits(even if watered down to the 5% alcohol) would have to be sold in a liquor stores in many states.
South Carolina, in an unexpected bit of rationality, repealed their mini-bottle law a few years ago. The law originally came about because the Southern Baptists in the state felt that limiting hard liquor to being sold in small 1.7 oz (50 ml) bottles was the way to prevent the sin of drunkenness. A peculiarity in the law meant that the bottle had to be opened in front of you, and the entire contents used to make your drink (to prevent bootlegging and watered-down drinks). So if you wanted a drink that had 2 or 3 ingredients, you were getting a pretty stiff drink.
Someone eventually pointed out that they were the last state in the Union serving drinks this way (other than the airlines) and all those tiny glass bottles ended up in the landfill. So in 2010 the state went free-pour.
I was thinking along the same lines; but there's a potential problem in that this provides an incentive to mislabel a beverage's ABV to get a lower tax rate.
That's probably solvable-ish by fining companies found to have an ABV off by more than 1% or so, but that's a lot more work to monitor, especially with the number of different products on the market.
You can't (well, shouldn't) mislabel your beverage's ABV. It's trivial to test and thus determine that you're lying, and the result would be a hugely costly recall of all product.
The accuracy requirements are very strict on this. It's already not a problem; intentionally lying about ABV on the label would be a foolish thing to do that would get you in lots of trouble.
Sure, but which industry specifically? Spirits makers would benefit. Who loses? Those who are hellbent on only every using malt to produce these kinds of beverage?
There can't be too many states where the liquor lobby has a strong hold. Pretty much every liquor store I've encountered is a hole in the wall. How could they possibly stand in the way of the producer lobby?
In some states the industry of state government loses because distilled beverages are sold only through state owned stores. I live in VA and in 2018 sales at state ABC stores were $1 billion dollars. This generated $196.7 million dollars in net profit. In addition the state generated another $302 million in taxes on sales at these stores.
VA has quite a few distilleries you can visit. You can purchase bottles at these distilleries but the distillery is acting as an agent for the state. Bottles are sold at the same price state stores sell them at, the distillery deposits all sales in a state bank account each night and the distillery is later paid by the state their negotiated wholesale price.
In NY at least small and medium liquor stores would disappear quickly if their legal mandate disappeared. There's usually one right next to every supermarket, who would love to sell wine.
So many strange laws on alcohol. No sales on Sundays in certain areas. Liqour store might have to be in it's own enclosed space (weird little room in the grocery store with a separate cashier), or it's ran by the state itself. Closing time at bars.
We are over a lifetime from the temperance movement but we are still affected by it for who knows why.
Nobody goes out and specifically votes for the pol who drops one particular liquor tax by a few %. People do go out and vote against the pol who encouraged "public degeneracy" or however their opponent frames it.
People have said such things. Sometimes these things change. But for the most part it achieves its original goal (which varies by jurisdiction), and hurts no one, so it continues.
I've never been so hard up for a drink that I need to buy liquor and beer in the same store. And if I was, I hope that I'd have the sense to check myself into rehab.
That is a silly justification for a silly rule. They idea that you have to go to a state run store to by booze is soviet-like. Really, that's stupid. When I'm in California one can shop around and get selection and price. In North Carolina or Virginia one is limited to a soviet style market. To make a stretch from a working free market to rehab is fallacious and simple minded.
I meant the part about "these two drinks are treated differently because of how they were produced even though it's the same % alcohol", not the liquor/grocery store separation.
Amusingly tax policy also allegedly gave us brandy. When you're taxed by volume (such as by the cask or barrel of wine) you may wish to dodge some taxes by distilling your wine product into brandy ("burned wine") to concentrate the volume, with the aim of re-constituting it with water for consumption, later.
Then of course you find out the reconstitution tastes nothing like the original wine, and you also may discover that leaving it in the wooden casks makes a pleasant drink on its own...
This is also a reason not to drink cask-strength whiskey straight: to wit, you're not meant to; you buy cask-strength so you're paying for less water, since you can provide that yourself.
I believe addition of water (especially at higher proofs) also creates short term reactions with the alcohol and amphipathic molecules (such as guaiacol for Islas) in suspension, before finding a new equilibrium -- bringing them to the surface of the liquid and creating more flavor/aroma.
Unless you enjoy the strong flavor. I don't drink alcohol but I do drink espresso: ristretto, no adulterants (except the occasional mandarin peel -- I'm not above a little variety). I dislike americanos almost as much as I hate long pulls. The intensity is a significant component of my enjoyment (same with blue cheese, hot sauce, etc.) and if I drank, I'm positive that I'd find cask strength to be the best strength.
An expert argument against drinking cask straight, one I'm not qualified to evaluate but can repeat here, is that high-proof alcohol actually impedes your ability to perceive the characteristics of the spirit itself. If you just like the taste of very strong alcohol, dilute some Everclear down; don't waste money on cask whiskey (for the most part, the only whiskeys sold at cask strength are expensive, premium expressions).
I sometimes drink Four Roses cask-strength straight, because I'm lazy, but also cask-strength Four Roses is not all that high-proof. But I wouldn't drink Thomas Handy straight; it would be a waste.
To build on what tptacek said. If the flavor you are going for is "burn", then high proof will certainly get you there. However if you want more nuanced flavors, at high proofs some the taste buds actually become numb (or overloaded) and you will taste some flavors less, not to mention that at very high proofs many of the molecules that provide taste are "locked up" by the alcohol, and the addition of some water can free them for you to actually taste them more.
I believe it is common practice for masters blenders, such as when selecting casks for blending, actually dilute things down quite a bit, so their taste buds don't become "exhausted" and they can pick out more nuance.
>As a gay man in New York with a well-stocked bar, I am used to my friends coming to my apartment and asking for vodka sodas.
meh. As a gay man in a midwestern rust belt town with a used fridge that makes exorcist noises, I am used to my friends assuming I drink vodka soda. I got a six pack of "white claws" from a female friend and couldnt choke down more than a few sips.
If youre going to drink a vodka soda, for god sake avoid this landfill fodder and pour one yourself. vodka comes everything from cotton candy to bacon, so theres really no excuse.
There are better hard seltzers than White Claw for sure, without that artificial, off flavor. Oscar Blues in Texas produces a brand called "Wild Basin" that is by far my favorite, but not sure how wide distribution is. I've seen Trader Joes carry a brand that's pretty good as well, though the name escapes me.
I don't understand why this comment should have been downvoted. I disagree because I like White Claw, but downvoting someone due to drink preferences seems rather hostile.
Midwestern humor isn't for everyone. It has a bit of a sour aftertaste.
Non-Midwesterners may mistake it for hostility, in the same way that non-New Yorkers might mistake an offhanded cultural observation--or anything the New Yorker says, really--for being a rude, arrogant prick.
(Edit: Not you. The author of the article is the New Yorker.)
(Edit 2: If you are a Midwesterner, then you're not a non-Midwesterner, by definition.)
(Edit 3: Let's not even go into how someone with a used Exorcist fridge is snooty for dumping on Keurigs. That's some Midwestern humor right there.)
In Finland, the difference between fermented and distilled products was not taxes, but that until very recently it was illegal for anyone but Alko (the local alcohol monopoly) to sell anything that was distilled.
The law was changed like a year ago and now only the alcohol content matters, anything with less than 5.5% vol can be sold in stores. Fermented beverages used to enjoy strong sales, but it seems like tastes are rapidly shifting towards distilled ones. IMO they generally taste better.
Sounds similar to Norway, where only there is a max alcohol % (5%, IIRC) can be sold in supermarkets, and anything stronger is only available through the state monopoly, Vinmonopolet.
In Western countries outwith the Nordics, this may sound awful, but I've come to appreciate it. Vinmonopolet stores sell a curated stock of high quality alcohol drinks, and their staff are invariably both passionate and highly knowledgeable. In short, the ethos is "quality over quantity" - and I like it.
For some context, I live in the UK, but work for the Norwegian division of a megacorp, and have travelled to Norway frequently for decades.
in the us, we also have 'good liquor stores' and 'regular ones', the market is lucrative enough to support such things without a mandated government monopoly. same should go for UK as well I presume..
I would have thought so too. And yet, most of the "decent" alcohol stores (e.g. Oddbins) died a death several years ago.
Depending on where you live, you might find niche shops if you look hard enough, but they are far from ubiquitous. It seems the market has decided, and they want the cheapest swill they can buy.
The stigma is mostly due to how shitty every malt beverage tastes, aside from drinks like white claw that fly under the radar. You make a tasty malt liquor and it will sell like a bota box (or white claw). In college, we only bought 40ozs to duct tape to our hands, so there's that image about the product as well.
In addition to the taxes mentioned in the article, It's also important to note that in many states in the US distilled beverages are only permitted to be sold in certain licensed stores. (Oregon for example has liquor stores, and you can't buy distilled things at a regular grocery store)
I was confused by another commenter's post saying Smirnoff's ice and Mike's hard were made with malt liquor, both are made with vodka here. But, booze can only be sold in licensed stores here so there's not much incentive to make them different and I imagine mixing vodka with carbonated sugar water is cheaper than using malt liquor.
In Japan, the tax for beer is insanely high. "Free beer" doesn't happen in Japan because beer is expensive. It makes most major beer companies R&D beer-taste products which is by definition of the tax law, not a beer. On the other hand, the canned vodka soda so cheap.
"It doesn’t contain vodka or any other distilled spirits. Instead it is made through fermentation, like beer, but starting from a base of sugar instead of cereal grains like barley."
This is a roundabout way of saying it's undistilled vodka. All spirits are fermented before distillation (or else what is there to distill?), and some vodkas already start with pure sugar instead of grains, potatoes, or fruit.
> This is a roundabout way of saying it's undistilled vodka.
Not really. Since you can make vodka from the same cereal grains that beer is made from, you could also describe beer as undistilled vodka, but that wouldn't make a ton of sense. Its major similarity to vodka is its neutral taste, not its base ingredients.
* poof! - Constitutional amendments are passed in every state requiring sales tax to apply to all items at an equal rate. Politicians suddenly have less power to punish or privilege individual sectors and industries, and so there is less reason to lobby and corrupt them. Sin taxes go away, so constituents are nudged and nannied and pandered to less. Much labor to track and charge differential taxes is disappeared. *
In general, it seems to make sense to have different taxes for items with substantially-different negative externalities, e.g. a carbon tax or cigarette tax.
I'm not answering for hirundo as I suspect our views are different.
But generally speaking it has been recognized that broad based sales taxes across all products is more stable when it comes to various economic downturns and etc. Same goes for just say property taxes that cover X, but not Y property.
Some sin taxes that get tagged to be used for "good things" often have bad results if usage drops and the "good things" that we previously wanted to fun suddenly have no (or a dramatic drop) in funding.
I'm not saying anyone shouldn't / can't do such things but there are reasons to avoid tax policies where things are taxes dramatically differently. How much "dramatically" is obviously up for endless debate.
That doesn't mean "tax should be the same for all items" but keeping close to that concept is not a bad idea.
That’s more of an argument for not using sin taxes to fund anything other than public health measures to combat the effects of consuming the thing that’s being taxed.
I don't really think it is the government's role to police private behavior choices.
It would also cause the personally responsible poor to have more money because sales taxes are regressive. God forbid a blue collar worker wants to have a couple of beers after work.
You don't have to believe it's the government's role to police private choices to support sin taxes; another coherent way to look at them is that they internalize market externalities.
Sales taxes are in some sense fungible, in that vendors could eat the cost to consumers by reducing their prices, in the same sense as a direct tax on those vendors would also be fungible, in that vendors would raise their prices to account for the taxes. Arguably, consumer-facing sin taxes are cheaper and simpler to administrate, and are the superior solution.
Is any government calculating the net cost between tax dollars spent because of cigarette smoking and tax dollars gathered from tobacco products and setting the tax in that manner?
Has any government put a lower or higher tax rate on any tobacco product based on risk or cost profile?
It is not that the arguments you are making aren't viable, I'm just not so sure that anyone is actually doing those things.
But that's not a complete engagement with the argument, right? Fuel taxes pay for more than just the carbon and pollution externalities of driving, but also of the cost of maintaining safe roads.
You can obviously disagree with the argument, but it's not incoherent and is in keeping with the underlying notion of a Pigovian tax.
But most of us do feel like the government should police behavior that negatively impacts us all. I want to dissuade people from smoking or excess drinking because it makes health insurance for me and my family more expensive while tying up hospital resources treating people for preventable diseases.
Not only that, but cigarette companies target youths with an addictive substance that people eventually want to stop using but have a very difficult time doing so.
> I want to dissuade people from smoking or excess drinking because it makes health insurance for me and my family more expensive while tying up hospital resources treating people for preventable diseases.
If smoking reduced total health expenditure (because those who die early from smoking-related illnesses avoid the costliest years of their lives), would you advocate for the government to encourage smoking?
I considered multiple facets when making this decision: 1) people are harmed by it, 2) even though people willfully start doing it, they can't always willfully stop doing it, 3) it negatively impacts them and their family's health/finances, 4) it negatively impacts society in a variety of ways.
I believe that impacts to society is what gives society (read: government) the right or obligation to intervene. Taxes are an effective mechanism of softly encouraging good behavior and they have much less risk of unintended consequences than total bans do.
This works so long as you don't think it's unethical for hospitals to turn away people that can't pay. Otherwise other people's negative health choices cost me money.
Are you somehow supporting the hospitals separately from the taxes that everyone else pays? All of our stupid pointless wars cost me money, as well as being deeply evil, but that argument hasn't stopped them yet... in the meantime keep your hands off my consumption of beverages.
> Are you somehow supporting the hospitals separately from the taxes that everyone else pays?
Yes. The cost of my health insurance is based off of the cost to hospitals; hospitals need to charge paying customers more if they have to write off their non-paying customers.
> All of our stupid pointless wars cost me money, as well as being deeply evil, but that argument hasn't stopped them yet...
Our stupid pointless wars are indeed one of the biggest breakdowns in democracy. Bush promised to stay out of foreign entanglements and Obama promised to leave Iraq and Afghanistan. As CiC, the president does not need any help from congress to withdraw (or refrain from sending) troops, so these are much easier promises to follow through on those that require congressional approval.
> in the meantime keep your hands off my consumption of beverages.
If you're going to wait for politicians to act with high standards of ethics before they pass any regulations, you are, for all practical purposes, arguing for anarcho-libertarianism.
Yet other people also pay for health insurance... I don't see how your situation is unique.
The thing that the system does, continuously, for decades, is not a "big breakdown". It is obviously the purpose of the system, intended by those who control the system. The system is not waiting for a good person to come along. That candidates lie about everything all the time has been a commonplace assumption throughout my lifetime. Yet still they are elected...
Since I am an anarchist, I often argue against arbitrary authority and its capricious and unjust actions. I contrast my position with those of people like yourself who believe that their own economic decisions entitle them to subvert the autonomy of others.
As with most things, it's a little of both, not binary. Your decisions effects others, others decisions effect you. You can spend your entire life not making a dent into how complicated that particular equation is..or...you can just not be a dick and either try to help other folks or at least not go out of your way to make their lives worse.
We have this technology called representative democracy which allows us to make that determination. Other societies have other technology. It all boils down to might makes right in the end though.
Probably the same answer to "how do people form beliefs?"
Off the top of my head, I'd say a combination of genetics (studies show political leaning has a genetic component) and input (from social circles and reading).
As long as I don't get assaulted by a drunk dude or get cancer from second hand smoke I agree - but a lot of these sin taxes are on items that effect others through their usage.
Other than the arguments about negative externalities, it seems more ethical (or fair, if you will) to have less or no tax on items that are necessary for life (food, shelter), vs items that are more of a luxury (big screen tv, party supplies). Not so much to curb certain behaviors and encourage others, but it would really suck to be taxed based on the oxygen your body consumes, for example. Or taxed on the vegetables you grow in your garden.
Barro means that it gave us White Claw in the sense that we don't instead have canned vodka tonics (in effect: alcoholic seltzer), because vodka is distilled, and White Claw's cane-sugar-brewed alcohol is a tax workaround.
We have the product category itself --- alcoholic seltzer --- on its own merits, according to Barro. There's no escaping it.
Slightly related: I tried to buy an expensive used camera from one of my favorite online retailers from New York and discovered that used electronics were now being taxed. They lost a big sale yesterday.
I've been mixing a shot of whiskey, bitters, and club soda with a splash to a few glugs of ginger ale/beer, still playing with the mix. Would be nice to start seeing better ready-to-drink options.
For real. I was in UK for a week, the mixed drinks over there are amazing. Had something called wkd, which is apparently regarded as a pretty trashy drink, but it tasted like fizzy gatorade, couldn't even tell it had alcohol in it.
WKD tastes good because there's a ton of sugar in it. There's plenty of sugary alcopops in America already (Smirnoff Ice, Mike's Hard Lemonade, Four Loko, etc.).
honestly, the taste of alcohol is repulsive to me, but I enjoy drinking with friends. I find myself physically unable to drink hard liquor, and beer becomes tough after a couple drinks.
I've seen them at Hazel's in Boulder, but I don't know the brand. To be totally honest I've been a bit sloshy every time I've been offered one and decided it was a good idea to crack it.
There are some interesting tidbits (tax laws between beer vs distilled spirits), the reason everyone I know drinks it is it's a low carb alcoholic beverage. You can bring it ready made to a party, which is easier than mixing a drink of seltzer and vodka at your friends house.
which is easier than mixing a drink of seltzer and vodka at your friends house
When I was a very young child (six or seven), it was my job at my parent's parties to mix the gin and tonics. If mixing seltzer and vodka at a party is too hard, it's time to stop drinking.
Personally I've just started drinking (very occasionally) low calorie beer. My favorite is Corona Premier. 90 calories + 2.6g carbs (4% ABV) vs 100 calories + 2g for a White Claw (5% ABV).
Less alcohol, more refreshing, tastes pretty much like regular Corona, and something about drinking Mexican beer always reminds me of sitting on a beach.
The margins are just stupid good. Apparently Upslope brewing here already makes more profit on their seltzer than all of their beer.