If there’s one thing that isn’t up for debate, it’s that Americans certainly love beer. In 2018 alone, drinking-age adults in the United States consumed about 26.2 gallons of the fermented alcoholic beverage, or an estimated 6.3 billion gallons in total. And while Americans spend on average over $1,200 per year on beer, there’s one price we aren’t willing to pay—and that’s the collapse of the free market.
But beer manufacturers, it would seem, haven’t gotten that memo. Instead, Big Beer is actively working to subvert the very free market system through which their industry has flourished.
Peter Coors, the vice-chairman of the Molson Coors board, just recently admitted that his company has effectively abandoned its market-based approach. Coors now views government interference within the industry as “necessary,” with federally-mandated price controls deemed the proper tool for controlling costs.
Unfortunately, Coors’ admission serves as a bellwether for Big Beer as a whole. Rather than compete to offer consumers the lowest price and the highest quality beverage, these beer companies are more interested in appealing to the federal government for protection and support. The industry has embraced full-scale cronyism, substituting political favors for market forces, and harming consumers in the process.
It’s no wonder, then, why Big Beer is lobbying hard for the passage of the Aluminum Pricing Examination (APEX) Act. The bill was introduced in the House by Colorado Republican Congressman Ken Buck and represents the pinnacle of corporate cronyism and anti-free market deck rigging for Big Beer itself.
The APEX Act would provide the government with enormous control over the price of aluminum. The legislation would grant the federal regulators sole jurisdiction over aluminum’s reference prices. And given that these reference prices reflect the cost at which aluminum sells, the bill effectively institutes a price control, which will undoubtedly amount to an artificial price cap, over the entire industry.
But how could the government justify such a massive takeover of a functioning free market? Only through an extensive disinformation campaign—promoted by Big Beer itself. APEX supporters, Big Beer included, have consistently repeated the false notion that aluminum’s reference prices are subject to unfair adjustment from greedy industry insiders. Due to these unseen, unproven market manipulations, the government must intervene—so the argument goes.
Only, the existence of any such manipulation has already been refuted by the Christopher Giancarlo, then the Chairman of the Commodity Futures Trading Commission. During his May 2019 testimony before Congress, the Chairman laid bare the truth: “we have not found manipulation in the [aluminum] market.” But that fact hasn’t stopped Big Beer from repeating the falsehood to push the APEX Act through Congress.
The reason behind the Big Beer’s support for the bill is as obvious as it is self-serving. Aluminum cans are one of beer manufacturers’ primary expenditures, and through the use of government force, the APEX Act would cause the price of aluminum to decline. Big Beer may claim to desire fairness and transparency, but in actuality, these beer manufacturers are seeking leverage. They want greater control over the market for aluminum prices. And they believe the government can give it to them.
Through the passage of the APEX Act, the beer industry would cement its crony relationship with the federal government. If Big Beer had its way, it would strip the aluminum industry of its ability to determine prices, merely to pad the beer businesses’ bottom lines. As Americans, we cannot allow that to happen.
Corporate cronyism has no home in America’s proud beverage industry. The cost of a beer mustn’t be the abandonment of free-market principles or the livelihood of the already-struggling American metalworking industry.
Andrew F. Quinlan is the president of the Center for Freedom & Prosperity