Huzzah for the Institute for Justice for challenging yet another state sponsored protection scheme. The Supreme Court ruled Monday that it is unconstitutional for a state (in this case, New York and Michigan) to allow in-state wineries to ship directly to customers while prohibiting out of state wineries from shipping their product directly to the consumer. States, like New York, - citing their right to regulate alcohol sales - have required wineries to sell only to in-state wholesalers, claiming that states have an interest in regulating alcohol sales.
States do have an interest in regulating alcohol sales - money. States are loathe to forfeit the millions in extra tax revenue they earn by regulating the alcohol trade. Additionally, native wineries (no matter how low quality their product) benefit from the state's protectionist restrictions. So how will states respond to the Supreme Court's ruling? They may decide to scrap the restrictions altogether and allow all wineries equal access to the citizens. On the other hand, they may decide instead to restrict the sell of any alcohol and prohibit all wineries - in or out of state - from shipping to any state resident - giving the state complete control over the sale and distribution of alcohol. But kudos to the Institute for Justice and to Juanita Swedenburg for taking on the state of New York and fighting for unfettered competition.
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