LOUISVILLE, Ky. (WDRB) – If Mitch McConnell has any moves up his sleeve to cool President Trump’s trade wars and curtail European whiskey tariffs that bourbon makers call “devastating,” the Senate majority leader didn’t tip his hand on Tuesday.
Speaking to whiskey industry players at the U.S. Distilled Spirits Council’s inaugural conference in Louisville, McConnell offered a broad defense of Republican economic policies but no specifics about potential relief to the tariffs that the distilling trade group blames for a 27% drop in U.S. spirits exports to the European Union last year.
“I am not much of a fan of the trade wars and I know you’re not either,” McConnell told the audience, compromised of employees of distillers like Beam Suntory, Brown-Forman Corp., Heaven Hill and Diageo. “But without exception, this has been an administration, I think, in conjunction with the Republican congress, the first two years, that has made significant progress as a country.”
The Republican leader also warned the audience that Democrats are “coming after you” with tax increases if they “make any effort to pay for all this free stuff” the party’s presidential contenders have been promising on the campaign trail.
The European Union, a key export market for Kentucky bourbon, Jack Daniels and other American whiskeys, imposed 25% tariffs on U.S. whiskey in 2018 in response to U.S. tariffs Trump enacted on imported steel and aluminum.
While the American whiskey industry continues to grow, capturing market share from beer and wine, the additional tax on European product has subtracted from that growth, Distilled Spirits Council chief economist David Ozgo said.
Late last year, the U.S. slapped a 25% tariff on imports of single-malt Irish and scotch whiskeys and liqueurs, affecting global companies like Brown-Forman and Diageo that import those products to U.S.
Speaking to WDRB following his remarks, McConnell acknowledged that he has “had very little impact on the president” who is “a big fan of tariffs.”
Asked about relief for the bourbon industry, McConnell said, “It’s been kind of an ongoing battle, but the discussions are still underway, and I think there’s some level of optimism.
“I’ve made every effort to try to acquaint the administration with the unique bourbon industry. It’s not on everybody’s mind when they get into these big trade talks. But I’m thinking -- I’m hoping – it’s going to have a good ending.”
More than 300 distilling industry professionals are attending the spirit council’s first conference this week at the Omni Hotel downtown.
A common refrain on Tuesday is that the U.S. whiskey industry has been “collateral damage” in Trump’s trade disputes.
Chris Swonger, president and CEO of the spirits council, called DISCUS, said the industry hasn’t lost hope the levies will be removed.
“We are hoping both the E.U. and the U.S. will stay at the negotiating table ... It’s complex, it’s frustrating. To some degree it feels a little helpless,” Swonger told reporters during a briefing Tuesday. “I hate to say that, because we are somewhat dependent on the political winds, on things not related to our industry.”
