Across the Great Divide

The Alcohol Tax Glass is More than Half Empty.

The latest debate over Sunday liquor sales in Minnesota has featured claims that Minnesota is somehow missing out on $10 million in tax revenues.

Puhlease.

I've debunked parts of this claim via twitter and comments sections, but thought it worth a post because this shows how interest groups can use data to mislead the public and policy makers. I wrote about this when it came up last session and won't repeat myself here.

Let's focus on this commentary by the Distilled Spirits Council published in the Strib with the subhead: "The Sunday ban on liquor sales costs state an estimated $10 million." The author says:

Colorado, the most recent state to enact Sunday sales, even saw its 2008 alcohol excise tax revenue collection increase by 6 percent despite the toll of the recession.

Well, not quite. Colorado's 2008 alcohol tax revenue, according to the state's annual report, only increased by 1.5 percent over 2007. But since Sunday sales took effect July 1, 2008, perhaps the author meant the 2009 fiscal year ending July, 2009. A Denver news report says:

Colorado State Treasury’s data shows that liquor, beer and wine tax revenues increased by $2,056,858 in the 12 months following July 1, 2008, when the bill allowing Sunday liquor sales went into effect.

Now, there may be various reasons why Colorado saw a bump in 2009, but why should we suppose the growth in FY 2009 was due to Sunday sales? Especially when Minnesota's alcohol tax revenues increased almost $3 million between FY 2008 and 09 [PDF], without benefit of adding Sunday sales?

Another claim made in the piece:

A national analysis of states that allowed Sunday sales between 2002 and 2005 (12 states) showed that in 2006 each state saw an average 5 to 7 percent increase in tax revenues.

I have no doubt that's true, since during the same period, Sunday-deprived Colorado saw a 10.3 percent gain and Minnesota saw a 3.3 percent gain.

In other words, revenue from alcohol sales slides around from year to year, and depending on the period you select, you can make the numbers dance your dance.

But the most troubling thing to me is the takeaway the Strib opinion piece is allowed to leave. Even by the Distilled Spirit Council's own estimate, only about half of Colorado's $2 million gain in one year could be attributed to higher liquor store sales. (Two percent of the 6 percent gain was the national average gain and about 75 percent of the alcohol taxes collected come from package liquor stores, according to the Council,)

Allowing for Minnesota's higher alcohol tax rate overall (it takes in roughly double what Colorado does), how do we get to $10 million more in tax revenue with Sunday sales?

We don't.

And if you think the difference is coming from recaptured sales lost to Wisconsin, please comment here so I can debunk that one, too.

UPDATE:

For the real tax nuts, I've added a couple analytical footnotes to his post over at the Growth & Justice Blog.

Can Economics Explain Hot Tomato Cafe?

We biked out to Fruita, a small town west of Grand Junction, for the reopening of a local pizza cafe that had moved into a new building after failing to come to terms with its former landlord.

The Hot Tomato Cafe renovated an empty building around the corner once occupied by a dry cleaners. (Around the corner is about as far as you can go in Fruita and still be downtown.)

We arrived sometime around 1:00 and the line stretched from the order counter to the door. It was the same way when we left, and the festivities involving bands in the street hadn't even begun to take shape yet.

You can see the improvements the two women owners have made to the building — adding a spacious outdoor seating area along the side. Landscaping is still in process, and the bike parking might need a little work, but no one was complaining.

Less apparent than the paint job and the cheery interior is the role a unique and beloved business can play in a community. The pizza and beer at Hot Tomato are good, and cycling is part of the vibe, but it was clear that most of the people showing up today were there because they wanted this little institution to exist in their lives.

I get really tired of hearing about how the market is all-important, and how economic principles (are you listening, Craig Westover?) should determine how governments and societies make decisions. The adherents to this thinking would have us believe that we have made the choice when we have a Domino's instead of a Hot Tomato in our neighborhoods. And that if a Pizza Hut franchise can come up with the financing where a Hot Tomato can't, well, that's as it should be.

You could try that line of thought in this pizza joint this afternoon, but I don't think you'd get any takers.

The Stuff You Learn Riding a Bike.

Bicycling magazine named Minneapolis the number-one bike friendly city in the U.S. True? Hard to say, but we have a bike friendly mayor who may someday make Minnesota the most bike-friendly state.

*****

I used to play golf with a sweet man who had Parkinson's. It killed him a few years ago.

He wasn't quite as shaky as the man in this story, who had severe Parkinson's yet was able to ride a bicycle, but he could make putts that gave healthy men the shakes.

In case the "what's the point of this post" guy is reading: Don't assume — try.

*****

Decided at the last minute to do #30daysofbiking and document the rides with a photo a day. The cool thing about this is bringing together the hardcore riders with people just starting to realize what a bicycle can do for them.

Today, I didn't have any need to get out of the house. Had plenty of food, beer and writing work, but not much in the way of exercise, so I invented an errand to head down to my favorite beer store to load up on bombers from Avery and Great Divide.

Almost no matter where I am heading, I start downhill first, with a pretty spectacular view. I shot this one from the saddle on my way into town yesterday. (I mistakenly labeled it as day 1, but my day 1 ride was in the dark.)

You can follow the photostream here.

*****

Yesterday, I tried to locate a homeless man who had lost his entire camp to fire. I had a tent to give him, and I rode around town with it strapped on the back of my bike. I took a side trip along the Colorado River where some homeless men camp, riding a footpath past several camps, but not finding him. 

You can see how dry the area is now with the winter-killed vegetation. Not a good place for a warming fire.

I did manage a flat tire. I'd unloaded my repair kit to more easily transport the tent, so I had a good long walk back to town for a fix.

Karma is not always what it's cracked up to be.

*****

On today's ride, I got to see three Suburbans zip behind me in formation as I rode along a river trail. I'd seen their vehicles several times at the airport and assumed they were either a charter service or the bus service for some kind of religious cult.

But today, they rolled into a parking lot where men were standing around like parking ushers. I stopped to watch as they circled the lot, stopped, and men jumped out of the doors simultaneously and struck paramilitary positions around the vehicles.

Turns out Grand Junction is home to an executive security school.

The stuff you learn riding a bike...

Also, here's the photo from today's ride. The guys standing at attention around SUVs just weren't that cool.

Hopslam on Ice.

Yes, it's still icy out, but there are still rewards for being in Minnesota in January.

The Other Man Behind Gumby.

Gumby's creator, Art Clokey, passed away this week. The story of his abandonment as a child and subsequent adoption has a wonderful outcome.

There's a local angle to the Gumby story, connected to another interesting character behind its success.

It appears that Gumby was one of the pioneers in marketing kids' toys through TV shows, though in this case, the show came before the toy.

TV stations broadcasting the Gumby films that introduced the claytoon character to the nation typically didn't pay for the program. For Clokey to make any money, he had to use the free air time as promotion for a product he could sell — a Gumby toy.

But Clokey was a film maker, not a toymaker, so eventually he licensed Gumby to a Minneapolis-based company, Lakeside Industries, and worked with an inventor named Jim Becker. (The story of the arrangement can be read in this Court of Appeals case dealing with a tax issue.)

In addition to manufacturing and selling Gumby, Lakeside marketed all kinds of cheesy toys and games. Some, like Barrel of Monkeys, Tub Town and the Big Wheel predecessor The Cheetah, still have their fans. Others, like American Heroes and the examples collected here, are largely lost, moldering in cabins or languishing on ebay.

I ran into Lakeside years ago when the company called looking for someone to write instructions for a new family card game called Sequence, a variation on Concentration that has rightly passed into oblivion.

After showing up at the company headquarters in a nondescript New Hope light industrial building, I was ushered into the office of owner Zom Levine.

Zom was a minute 80-something who dressed impeccably in tailored suits and custom, collarless shirts with studs instead of buttons. I suppose in New York City there are still buildings full of these old gentlemen, who make very good money from running  obscure businesses — ladies shoulder pad manufacturers, button stampers and safety pin distributors — but here in Minnesota, Zom was pretty exotic.

I have been in many offices of men who ran giant enterprises, but Zom's was the most impressive — and most secure. It was locked, with him inside, and I had to be buzzed in.

Unlike the concrete block and fluorescent ambiance of the rest of the building, his large office was dark paneled and mood-lit with a six-foot-long NASCAR racer Budweiser beer light hung over a pool table.

It turned out Zom was not just in the toy business (and the flex-film electronic control pad business). He was also a promotional beer sign mogul.

You have seen his company's work, dating back to the Hamm's Beer signs, lamps and prized Scenorama motorized displays, neon baseball signs for Miller or palm trees for Corona, and this Clydesdale under glass.  

The beer sign business, I learned, had a handful of regional companies like Lakeside that came up with new sign ideas for the dominant buyers, Miller and Budweiser. The brewers would accept certain designs, then take the drawings and bid out the manufacturing. The originators hoped their familiarity with the design would give them an advantage pricing  the job, but if they didn't match the low bid, they got nothing for their effort.

The brewers exploited this system for years. The neon sign shops grumbled but played the game because beer was the main industry still using neon for new promotions.

I worked with Zom as he tried to come up with new ways to break the hammerlock Lakeside and the other small companies were in. But the companies were nervous about losing all their business if the big boys decided they weren't being sufficiently subservient.

A couple years later, for his efforts organizing the suppliers against the abusive bidding system, Zom was indicted and convicted of price-fixing.

 I find it hard to believe these neon benders had any power to hurt the giant companies, but maybe it just shows Zom's competitors were right. They could not control their own destinies in the beer sign business. If they fought the system, they'd be ruined one way or the other.

Art Clokey found a way around the TV system to make his films and make a nice living. But he couldn't have done it without Zom Levine.

 

Beer and Karma.

After going on a field trip with the shelter kids to Underwater World at Mall of America this morning and knocking off some work for a nonprofit all afternoon, tonight I enjoyed a beer tasting sponsored by my favorite retailer comparing Oktoberfest brews. (My choices: Surlyfest, Avery The Kaiser Imperial Oktoberfest, Summit Oktoberfest, New Belgium Hoptoberfest and Flying Dog Dogtoberfest.)

In a raffle that benefited the local food shelf, we avoided winning all the beer paraphernalia and came home with the $40 liquor store gift certificate, thus indicating my karma is still in force. Of course, it helps to have purchased a fistful of tickets.

I ran into an old business acquaintance there who I hadn't seen for about five years. When we owned our businesses, we served as board members for each other's companies. He had recently returned from three years in India with his family, where his wife made India safe for Target, and he worked as a volunteer with India's marginal non-profits, trying to help them get funding.

We also learned they had a fecund pear tree in the yard that was disgorging fruit at an alarming rate. We were invited to stop by later and take home one of several five-gallon buckets  sitting on their porch, filled with water to keep away the wasps.

So we did. Reaching home, I made the rounds of the neighbors. It says something about our neighborhood that everyone answered the door on a dark Thursday night and welcomed a man in a windbreaker with a plastic bucket in one hand and Oktoberfest fumes on his breath.

Earlier this week, I made a beet, pear and feta salad that required me to purchase one Bartlett pear at the grocery store. Out of the hundreds of regular shaped pears, I found one that was almost suitably ripe.

Tonight, I came home with half a bucket of less perfectly formed fruit. In fact, you couldn't sell a one of them.

The photo shows less than half a bucket because some have already been devoured before bedtime. Had I tasted them first, I'm not sure I would have made the neighborhood circuit.

I suspect there are many lessons embedded in all this, and I am confident my readers are capable of extracting them. However, you will have to do it without tasting any of my pears.

Finding the Lost Beer Mine.

This story about a lost beer mine ran in the local news last week.

Verne Anderson and Dick Beye were rabbit hunting north of the Highline Canal in the fall of 1950 when they opted for a little target practice, aiming their .22 rifles at a shiny object in on the bank of an arroyo.

Much to their surprise, fluid erupted – and on further investigation the fluid was found to be beer from a well-perforated can of Schlitz.

Digging into the hillside, the boys found row upon row of Schlitz beer, the cardboard containers beginning to deteriorate.

Now, a witness/co-conspirator has come forward, with two cold cans of 60-year-old Schlitz to fill in some gaps in the story. [Photo by Lynn Lickers]

Beer Summit Run into the Ground.

The over-staged "Beer Summit" has been over-covered, though not very well, so I hesitate to spend another pixel on it here.

But it did represent a quintessential Across the Great Divide moment, and it concerned beer, politics and stupid media tricks — all favorites here.

Let's start with beer marketing.

“Enjoying a beer is a great way to bring people together,” said [the president of Anheuser-Busch, trying not at all to talk like a regular person.] “Anheuser-Busch and its distributors have more than 70,000 U.S. employees who brew, market and distribute our beers, and we are all proud to have Bud Light chosen for the White House meeting. Bud Light is the No. 1 selling beer in the country, the favorite beer of millions of Americans.”

Neil Cavuto of Fox News was just one Fox personality deriding the Beer Summit, bringing on the president of Yuengling, America's oldest brewery, and trying to get him to complain about Obama drinking that "foreign" beer, Budweiser.

Fox & Friends picked up the same thread. Steve Doocy hyped Coors Light as an American beer (Molson Coors is at least half-Canadian, but still pours money to right wing think tanks), while Gretchen Carlson trilled "This would be a good time to promote 'buy American.'" Presumably, that includes Corona, the other tasteless non-U.S. brand on display.  

Hannity devoted seven minutes to the topic, blathering about how Sgt. Crowley "risked his life to save [Gates's] property" and "Obama is far more radical than anyone will admit." Even if you know how vile Fox is, it's stunning to follow one topic through its various broadcasts and watch the propaganda laid down.

There was plenty of talk about the semiotics of beer choices, but not much in the way of suggested alternatives that might express a point of view more directly, while promoting America's small brewers. Obama, for example, might've chosen Ale to the Chief, Restoration or even Summit, but probably would pass on Dark Lord. Gates had a lot of options, ranging from Minnesota beers Furious and Not Guilty to Sublimely Self Righteous and The Devil Made Me Do It, depending on what tone he wanted to convey. If Crowley was still looking for an apology, he could've gone for The Unforgiven; a little humor, Blind Pig; mea culpa, Out of Bounds.

Oh, yeah. Biden had few choices. Old Peculiar doesn't make an NA version.

Maybe I'll save the rest for a more serious post.

Stop... in Crosswalk.

This crosswalk is in front of a middle school in America's No. 1 Small City.

But, hey, school's out, there's no evidence of blood.

I went in search of a Virgin Mary "caution" sign I saw over the weekend, but neglected to shoot when I had the chance. Unfortunately, it had been taken in or stolen.

However, I did get this shot a block away.

In March, I wrote about the closing of Sam's Wine Shop.

But last month, the store front had filled up again, with the old sign still in place. Now, it has a new name and a much better beer selection.

Things I Learned Tonight.

"Public Enemies": Waste of talent. Waste. of. Time.

There's a liquor store in Crystal that sells a no-name brand of beer for $2.99 a six pack and $4.99 a twelve, but if you're looking for Surly, you're out of luck.

The New Hope Cinema and Grill, on the other hand, has Surly on tap.