Haunted by Spirits

John McCain derived his wealth from his marriage to Cindy Hensley McCain, whose father started his road to riches as a bootlegger. As a politician, the senator has remained beholden to the liquor industry and the family business

And since McCain was elected chairman of the committee in January 1997, that's exactly what has happened.

In the summer of 1996, Joseph E. Seagram & Sons rocked the alcohol and broadcasting industries by announcing it would take to the airwaves, in violation of a longtime voluntary ban on broadcast advertising of distilled spirits.

The McCains' central Phoenix house  --  Cindy's 
childhood home  --  is a fortress.
The McCains' central Phoenix house -- Cindy's childhood home -- is a fortress.
The boys off the bus: John McCain takes questions in 
Concord, New Hampshire.
Ilkka Uimonen
The boys off the bus: John McCain takes questions in Concord, New Hampshire.

For decades, there'd been an uneasy truce between the distilled spirits lobby and those who want to ban alcohol advertising entirely: Print ads were okay, but broadcast was out. When Seagram reneged on the agreement, the liquor community took note. It wasn't just the distilled spirits lobby that was concerned. Seagram's unilateral actions could result in a severe backlash for all alcohol-related industries.

Beer and wine interests, whose products are advertised on the airwaves, feared that Seagram had opened a Pandora's box that could lead to tougher restrictions on beer and wine broadcast advertising as well.

In late 1996, members of the Senate Commerce Committee decided to hold hearings. A date was chosen, February 11, 1997, before Republican Senator Conrad Burns' communications subcommittee. (Burns' press office did not return calls.)

But before the hearings could be held, two important events occurred. First, the beer and wine industries mounted a strong lobbying effort to scuttle any committee action that might address liquor advertising.

Second, Senator John McCain was elected chairman of the Commerce Committee in January 1997 after former chairman Larry Pressler of South Dakota lost his November 1996 reelection bid.

Even before McCain's ascension, Pandora's box was flung open -- the beer and wine lobbyists could see that this wasn't just about hard liquor ads on TV. The distilled spirits folks also were jockeying for parity with the beer and wine industry, including equal excise taxes (taxes currently are based on the percentage of alcohol in a beverage) and the ability to advertise during sports broadcasts, the most lucrative shows.

The beer and wine lobbies don't want any of that.

The hearings portended a showdown between a divided liquor industry -- with the beer and wine industries trying to maintain the status quo while some hard liquor producers were trying to make inroads not only in broadcast advertising, but taxing issues as well. Another hot-button issue was alcohol advertising aimed at teens. The hearings likely would have broached that volatile topic.

The stakes were high and so were the campaign contributions. The Christian Science Monitor reported that hard liquor and beer and wine industry contributions doubled during that session of Congress.

Mounting contributions and intense lobbying paralyzed the committee as the hearings were postponed a couple of weeks.

Then, in mid-February, the committee announced it would not delve into the beer and wine industry's role in alcohol advertising. News of the committee's capitulation to special interests made the trade journal Advertising Age in a February 17, 1997, article.

The beer and wine lobbies had prevailed.

By mid-spring, it was evident the hearings wouldn't take place at all.

Clearly, the pressure the beer and wine lobby brought to bear on many members of Congress had something to do with the decision, but observers also wonder about the coincidental timing of John McCain's ascent to the chairmanship of the Senate Commerce Committee.

George Hacker was particularly disappointed that the hearings were derailed. Off and on since 1982, Hacker has run the alcohol policies project of the Center for Science in the Public Interest. He says it's very hard to get alcohol-related legislation heard in Congress, and more difficult since McCain took the helm of the Senate Commerce Committee.

"Having someone with no interest and who really refuses to take an interest in alcohol is a serious problem in the Commerce Committee," Hacker says.

But does mere indifference actually benefit the liquor industry?

"Well, sure," Hacker replies. "If the chairman has a problem dealing with these issues, he'll go on to something else."

In fact, three alcohol-related bills have been assigned to McCain's committee since he became chairman, and none has been taken up. All three were sponsored by Senator Strom Thurmond, a South Carolina Republican.

Thurmond has fought for alcohol industry reforms for decades. He first introduced legislation to require health warnings on alcoholic beverages in 1967. He was finally successful in 1988, although he's still not satisfied. Ironically, Thurmond's daughter was killed in a drunken-driving accident in 1993 -- prompting the Senate Commerce Committee to hold hearings that year; that's the last time such hearings were held.

The three Thurmond bills that have been before McCain's Commerce Committee all deal with alcoholic beverage labeling. They would transfer authority for the labeling from the Bureau of Alcohol, Tobacco and Firearms to the Department of Health and Human Services. Another measure would prohibit the alcohol industry -- particularly the wine industry -- from claiming benefits from its products on labels. (This bill has been introduced twice while McCain has been chairman.)

John DeCrosta, Thurmond's press secretary, says the alcohol industry doesn't want to be in the legislative spotlight.

"The...industry looks at what's happening with the gun industry, tobacco industry, the lead-paint industry, and they know they have a problem," he says. "This is something people consume, they get behind the wheel of a car, they cause deaths. They develop cirrhosis of the liver. They develop breast cancer. They develop hypertension. How long before somebody goes after them?"

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