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Despite Republicans controlling both chambers of the Texas Legislature, two major assaults on the free market made their way through this session. Now, Gov. Greg Abbott will have to decide if he will allow them to pass or use his veto pen to defend taxpayers.

On Abbott’s desk are a pair of particularly troublesome bills—House Bill 3287 by State Rep. Craig Goldman (R–Fort Worth) and Senate Bill 1289 by State Sen. Brandon Creighton (R–Conroe).

Goldman’s HB 3287 largely amounts to legalizing extortion of craft breweries by politically connected and legally protected beer distributors. In short, the legislation would re-criminalize brewers’ ability to sell the beer they produce at their own facility if they exceed relatively meager production limits.

Instead, brewers would be forced to sell a keg of beer they produce in their back room to a distributor who could then charge them a hefty markup for the simple act of moving the beer to their taproom—a mere twenty or thirty feet at most breweries.

If the bill becomes law it would not only be a major defeat for the free market, it would also put a major damper on Texas’ growing craft beer industry. The Texas Craft Brewers Guild and a number of citizen groups are calling on Abbott to veto the measure and claim to have delivered 15,000 petitions in opposition to the legislation already.

Source: Brewers Association

Meanwhile the other bill, Creighton’s SB 1289, is equally egregious, requiring state agencies to use iron and steel produced in the United States in construction projects—unless the preference would increase the total cost of the project by more than 20 percent.

Note that the exception isn’t if the iron and steel products cost 20 percent more, but rather the entire project which is comprised of concrete, labor, equipment rentals, and other items.

As a result, domestic iron and steel manufacturers will be allowed to charge potentially several times more than their competitors and still obtain the supply contracts. And as the costs of construction projects are allowed to rise significantly, taxpayers will be on the hook. The proposed law is also threatening to spark disruptions in existing supply chains, such as those with Canada, where three government representatives wrote a letter to the Texas legislature urging an exemption for Canadian steel and citing pressure to respond, likely in ways that would harm the Texas economy.

Such a change in the law runs counter to Republicans’ commitment to limited government and free markets and would place a heavy burden on taxpayers.

The Texas Constitution gives Abbott twenty days after the Texas Legislature adjourns during which he can sign or veto legislation. This year that deadline falls on June 18 and Texans will be keeping close watch on the governor until then.

 

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