She said.......
It's about the beer
                          He said........

Gina Miller            and                Bill Keeper

Hey Bill, well here I am back from my beer vacation to the Czech Republic.  I have to admit I
was surprised that In most restaurants and pubs across there a mug of beer is, literally,
cheaper than water. You gotta love it!  The down side was the government was trying to
change that.  Maybe they know our Mayor Bloomberg and his fight against large soft drinks.
Let's hope they'll have a harder time than the Mayor did here.  After all, it's the birthplace of
pilsner, beer, "liquid bread." It's a country where per capita beer consumption is37 gallons, the
highest in the world and more than double U.S. levels.

Pub patrons go through the sudsy amber liquid so fast that the nation's largest brewer,
SABMiller SAB  maker of famed Pilsner Urquell, delivers beer with the kind of tank trucks used
to haul gasoline, and pumps it into bars' storage vats.  Beer there is like mother's milk for
adults.  It's like wine for a Frenchman or vodka for a Russian.  

The government wants to require restaurants and bars to offer at least one nonalcoholic
beverage at a price lower than that of the same amount of beer.  They claim it's primarily
directed to offer teens, who can legally drink at 18, an alternative. If that's the case why don't
they just offer patrons pitchers of tap water?  Something doesn't seem right here.  There has
to be more pressing issues for the government to worry about, don't you think?  Most of the
Czechs I spoke to seem to agree with me in their dislike of government regulation in general.  
Maybe it's a legacy of the country's decades under repressive communist rule or simply a case
of let supply and demand determine price, not some bureaucracy.

Beer is really widespread there with very deep roots…It's a well-anchored, important part of
everyday life.  It's been that way. Since the Middle Ages when people there made beer their
primary drink due to polluted water.  The country is serious about beer. Its native hops are
world renowned for being aromatic and bitter. St. Wenceslas, a martyred 10th-century Czech
nobleman, is a patron saint of brewing and malting, in addition to being the patron saint of the
nation. I got a chance to stay in the city of Plzen, about 60 miles southwest of Prague.  They
got a charter in 1295 giving their people the right to brew beer, helping ensure the settlement's
prosperity.  So the history of the county is in a way the history of beer.

At a typical local pub, a pint pint—500 milliliters, actually, in this metric-measuring country—
costs about $1. A similar portion of water, juice or soda generally costs twice as much. Offering
free tap water as at U.S. eateries is extremely rare.  It's market forces at work they way they
should be - independent from excessive government social engineering.  

Of course if the government here would like to make a gallon of beer more expensive than a
gallon of gas then I wouldn't mind their intervention.

That's it from me, chug-a-lug, Bill.....see you next month.

Hey Gina, glad you had such a good trip.  After reading your comments I can now understand
why any change in regulations affecting beer is a very sensitive subject in the Czech Republic.  
Last year my cousin Pavel from Prague visited me and he explained how beer is at the center of
Czech social life. He told me it is common for people to head to a pub after work to relax and
socialize with friends. Barkeeps often don't ask customers what they would like to drink. Instead,
they just plop down a glass of lager and start a tab.  Sort of like bartenders here do for you Gina!

I can appreciate the view that the government risks over-regulating a struggling industry at the
most inopportune time, with the country in the midst of a recession. A wave of new regulations,
there or here for that matter, always runs the risk of being suffocating.  Still,I'm concerned that
relatively low beer prices encourage consumption and contribute to underage drinking, since it
makes beer more affordable for youngsters.

Czechs have the highest rate of alcohol consumption among children aged 13 to 15 , a rate that
is the highest in Europe and higher than that in the U.S. and Canada, according to the World
Health Organization.

There's also something puzzling about the pricing you mentioned.  Water, as you know, is the
major ingredient in beer.  To that other ingredients and extensive labor is added.  It should
therefore be impossible for beer to be cheaper than water.  My guess is the reason for that is
government subsidies to breweries.  Beer is a major Czech export so it makes sense.  

When I visited England a few years ago it is possible to buy beer cheaper than water there too.
Specifically, you could do it at grocery store chains like  Tesco, Asda, Morrisons, and Sainsbury’s.
And guess what Gina, beer is cheaper than water here in the USA too.  I just saw a bad macro
brew selling for  around $6 a 12 pack, which comes out to around 65 cents a pint while one pint
of spring water was priced at $1.25!  

By the way, thanks to the alcohol excise duty I paid nearly $9 for a pint of Budvar in a central
London pub (don't ask why Budvar)  but I did get a fee glass of water with dinner.    

Here's looking at you, kid!   See you next month.
Round 24