Tell the Government to Leave Distilling to the Distillers

The main problem with having regulatory agencies is that they employ a lot of people who, sooner or later, are going to try to regulate something. And while it would be infinitely preferable to pay these people to do nothing all day, it turns out that there are in fact limits to the depths of human laziness. Even government employees eventually feel obligated to justify their paychecks by actually working. What this means in practice is that we have an army of regulators proposing solutions for problems that don’t exist, problems such as, oh I don’t know, the size and shape of whiskey barrels.

Whiskey has been distilled, sold, and eagerly drunk by Americans even before there was an America. Heck, even George Washington made a sizeable chunk of his fortune from providing the good people of the fledgling nation with spirits. The system has worked pretty well for the last 300 years, and even the speedbump of alcohol prohibition in the 1920s didn’t put a dent in Americans’ love for sweet brown hooch.

Now in 2019, all of a sudden, the Alcohol and Tobacco Tax and Trade Bureau (TTB) has decided that it knows better than three centuries of tradition and hundreds of distillers all over the country, and is proposing a rule to restrict the types and sizes of barrels acceptable for aging whiskey.

Specifically, TTB is trying to define the term “oak barrel” to mean a “cylindrical oak drum of approximately 50 gallons capacity used to age bulk spirits.” Why does this matter? Because, due to previous regulatory interference, distillers are only allowed to call their products “whiskey” if they are stored in oak barrels, so the redefinition of what exactly constitutes an oak barrel can potentially have quite an impact (curiously, TTB uses the Scottish/Canadian spelling “whisky” throughout its regulations, which can presumably be attributed to latent communist and/or anti-American sentiment among its employees.)

The reason all this is important is that many small distillers store their whiskey in barrels that are smaller than the 50 gallons specified by TTB. This is useful for experimenting with new recipes, creating limited releases, or simply when larger barrels become more expensive or difficult to come by. For a start up with limited capital, it may be easier to use smaller barrels to begin with until revenue reaches a point where it makes sense to expand output. Additionally, America is home to some cooperages (barrel makers) which specialize in smaller sizes. The proposed redefinition of the word “barrel” would make these firms’ products essentially unusable.

Apart from the practical implications for small distillers and coopers, it’s always important to ask, what business is it of the Feds how a company wants to store their whiskey? There are no safety implications for using smaller barrels, nor is there any impact on the quality and flavor of the product. A distiller who uses 30-gallon barrels is not committing fraud or misrepresenting his wares to the public. In fact, there is no consumer protection justification for the prosed rule at all. The only thing it accomplishes is limiting the flexibility of small or start up distilleries to compete with more well-established firms.

If you want to protect the rights of American whiskey distillers, you can leave a comment on the proposed regulation here, explaining that these types of business decisions are best left up to the individual business, and should not be broadly proscribed by sweeping regulation. If you do choose to comment, be sure to list any relevant experience you have in the industry, and be clear and concise about your concerns. If the objections are numerous and well-argued, the agency may well back down on its efforts to crack down of craft distillers.