Laws passed to hand power to market incumbents and suppress competition usually aren't named "The Incumbent Protection and Consumer Price-Gouging Act of 2010". Instead, they're passed under the guise of remedying some terrible wrong in the marketplace. We get elaborate and expensive certification regimes . . . into which existing providers are grandfathered, belying the justification that the certification is needed to ensure that consumers aren't badly hurt by unregulated manicurists and interior decorators. Or elaborate regulatory schemes that are expensive to comply with--giving large incumbents a significant advantage over upstart competitors. Always, always the argument is that this is for the consumers, those benighted fools who would otherwise be helpless fodder for quacks and charlatans.
This anti-competitive, revenue-reductive bill, No. A06884, is being introduced by the New York State Committee on Economic Development. You can view the particulars here.As social problems go, "really, really rich people spending too much on fake wine" ranks somewhere below "people who pretend they can't see you so they don't have to hold the elevator". We don't need a new law to fix this. We need psychiatrists to examine the heads of the legislators who are thinking about voting for this monstrosity.
For those who don't have the time to read the fine print, let me summarize. Basically, under the guise of protecting you from counterfeit wine, New York is about to turn over control of an already heavily regulated market to a few powerful wholesalers. Counterfeit wine is only a problem at the highest end of the fine and rare wine market, and the auction houses and the top domains are developing strategies to deal with the issue. A few wealthy collectors buy questionable '45 Mouton every year, but this hardly seems a reason to overhaul the entire market.
Econ 101 tells us what happens when competition is restricted; prices go up and consumer choice goes down. No longer will New York restaurants be able to source wines from auctions and private collectors to bring you a wide variety of the world's finest and rarest wine.
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