Shipping now?

The Supreme Court has spoken. It is unconstitutional for a state to allow shipping by in-state wineries while forbidding shipments from out-of-state. States that meet that description will have to make a choice. From my perspective (that of a wine-loving free-market supporter) the choice is not hard. But of course real legislatures don’t necessarily love wine and they rarely see it their duty to promote free markets when there are donors and constituents who would rather make money without competing. So the coming political battle is between wholesalers, who make tons of money providing “services” that are required by law whether you want them or not, and consumers, who want to choose for themselves what to buy and want to look around for the best price. Consumers have the vote and wholesalers have the well-funded lobby. What makes me a little optimistic is that, in Indiana, for example, the farm lobby looks on wineries as a kind of farm – so consumers won’t be in this by themselves. I am also hopeful that responsible state officials will see legalizing direct interstate commerce in wine as a good tax move. I don’t know how many Indiana residents buy wine in person out of state and bring it back themselves. But I do know that none of them, not a single one, pays any Indiana tax on that transaction – because they are not allowed to. Legalizing shipment would mean that Hoosiers who buy wine in Chicago, say, and have it shipped, could be required to pay to Indiana the sales taxes that now go to Illinois. Legislators who turn down this revenue source should be held to explain why. But there is another twist to the tale in Indiana. A state statute (7.1-5-11-1.5) now provides:“(a) It is unlawful for a person in the business of selling alcoholic beverages in another state or country to ship or cause to be shipped an alcoholic beverage directly to an Indiana resident who does not hold a valid wholesaler permit under this title.” This appears to me to be a clear violation of the Supreme Court’s decision. Yet the state alcohol commission argues that other statutory provisions implicitly prohibit instate wineries from shipping as well, because they don't mention it either way. The Indiana statute allows instate wineries to sell their product but doesn't mention that they can ship it to the purchaser (or that they can hand it to the purchaser, or that they can put it in a paper bag). We used to joke that the distinguishing factor of a totalitarian state was that all was prohibited which the government has not specifically allowed, whereas under the principle of legality, everything is permitted unless it has been forbidden. Pretty clear which school the alcohol commission comes from. As one would ask a student in the first year of law school, what statute would one violate by shipping wine instate -- the answer is, the statute that isn't there. I guess this is what courts are for, which is why a group of us, including two out-of-state wineries, have filed suit in Indianapolis Federal Court. See the account in IndyStar