Redefining beer money

When our ministers' campaigns are paid for by foreign brew interests, it's easy to see why The Beer Store reigns supreme


As the owner of Indie Ale House once told me, Buffalo gas stations have better beer selection than The Beer Store in Ontario. “Azerbaijan has a better fucking liquor system,” says Jason Fisher, and he’s not exaggerating. Chinese State Television interviewed him once about our “oppressive” liquor distribution system.

Despite polls showing more than 50 per cent of respondents want alcohol sold in convenience stores, another May Two-Four long weekend has come and gone, reminding consumers that if they want anything from outside the foreign-owned brewopoly, their only option is the underwhelming aisles at the LCBO.

The government-protected oligopoly that is The Beer Store is nearly fully owned by Colorado’s Molson Coors and Belgian-led Labatt (a division of Anheuser-Busch InBev).

Why is the government against competition for The Beer Store?

In Ontario we like to think we’re more righteous – that our politicos aren’t quite so easily influenced by money as they are in the U.S. We have no American-style Super PACS (political action committees), and our lobby groups are less aggressive and well-funded on this side of the Great Lakes. We enjoy relative transparency in reporting election spending. All campaign donations over $100 dollars and their deposit dates are available at Elections Ontario’s real-time reporting website.

However, we do have loopholes that let foreign firms buy influence.

In this province, two of the more cunning ways are in party leadership campaign regulations (or the lack thereof).

One loophole neglects to set a limit on how much a corporation – any firm in the world that conducts business in Ontario – can donate to a candidate. The other allows donations to be made up to 20 months after the leadership vote.

Here’s how that played out during the race to replace outgoing Liberal premier Dalton McGuinty:

The media announced that Sandra Pupatello was the front-runner to replace McGuinty, based on the fact that she had 27 per cent of confirmed first-ballot delegates on January 14, 2013, 12 days before the leadership convention. The same day, Molson deposited $5,000 into the former Windsor MPP’s leadership fund.

Two days later, Molson deposited the same amount into the campaigns of Gerard Kennedy (whom Forum Research had consistently trumpeted as the favourite among the public generally and declared Liberal supporters in particular) and Eric Hoskins. Charles Sousa, who like Hoskins would soon become a senior member of cabinet, got his 5 grand one day later.

Molson finally made a $5,000 drop into Kathleen Wynne’s campaign on January 21.

Labatt took a more prudent approach. The makers of Blue waited until January 23 – just three days before the ballot, when polls were clear and contestants properly vetted – to make a generous $10,000 deposit in Hoskins’s coffers. The Toronto MPP, after being eliminated from the race, threw his support behind Wynne and ultimately became minister of economic development, trade and employment.

One day later, Labatt gave $17,500 to Wynne, the fifth-largest donation to her campaign.

Sousa, who became her minister of finance, overseeing the LCBO, received $10,000 from Labatt the next day.

Of course, the NDP and Ontario PCs also receive sizable donations from the owners of The Beer Store, which is why it’s no surprise that party leader Tim Hudak recently withdrew his plan to liberalize beer sales and deregulate all alcohol distribution.

The financing quirk that allows leadership contestants to receive donations long after the fact means that a cabinet minister can have his “failed” bid subsidized by a group he now has the power to reward with taxpayer dollars.

In June 2013, for instance, Hoskins’s campaign received $1,500 from the Ontario Small Brewers’ Association. That, coincidentally, was one month to the day before the minister announced a $1.2-million annual extension of the Ontario Microbrewery Strategy, which, as you may have guessed, is overseen by the OSBA (operating as Ontario Craft Brewers).

Incidentally, the OSBA threw another $5,000 into Hoskins’s campaign in December 2013, more than 10 months after the Toronto MPP’s leadership hopes were flattened on the first ballot.

When I attended the Ontario Microbrewery Strategy announcement last July, I asked the minister flat out why the government was so hostile to competition for The Beer Store despite polls showing that the public wants to be able to buy alcohol at convenience stores.

His reply acknowledged the need to grow distribution, but primarily through the LCBO.

“My understanding is that we’re not currently looking at expansion through retail outlets…. That’s an is-sue the minister of finance was looking closely at,” he says.

This, of course, is the same minister of finance who received a total of $15,000 in leadership campaign donations from the honchos at The Beer Store.

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