Bourbon Industry

Barr: No, governor, you're wrong and bourbon's too important for trade games

U.S. Rep. Andy Barr, R-Lexington, got a pat on the back from Treasury Secretary Steven Mnuchin during a live TV interview. Barr met with Mnuchin to express Kentucky distillers' concerns about the effect of President Trump's trade war on exports of bourbon.
U.S. Rep. Andy Barr, R-Lexington, got a pat on the back from Treasury Secretary Steven Mnuchin during a live TV interview. Barr met with Mnuchin to express Kentucky distillers' concerns about the effect of President Trump's trade war on exports of bourbon.

A day after Gov. Matt Bevin dismissed European tariffs on Kentucky bourbon as harmless, U.S. Rep. Andy Barr, R-Lexington, met with Treasury Secretary Steve Mnuchin to share distillers' concerns over exports.

"I conveyed in very proactive terms the concerns that the Kentucky Distillers' Association has with respect to the threats of retaliation from the EU," Barr said.

On Thursday, after Bevin announced on CNBC's "Squawk Box" and on Bloomberg that a 25 percent European tariff on bourbon wouldn't have "tremendous impact" on the state's $8.5 billion bourbon industry, the distillers trade group issued a statement saying that a trade war will do "significant" harm to distillers, farms, tourism and ancillary businesses.

Barr said Friday that Bevin is wrong about the lack of impact.

"I respect the governor a lot but on this particular issue I disagree," Barr said.

Bourbon, manufacturing and agriculture benefited from Republican-passed tax cuts, Barr said, and these "are three signature industries that could see disruptions that wipe out the gains from the tax cut."

Barr told Mnuchin "I'd like to see a quick and expedited resolution of these trade issues so that we don't have any disruption to our exports."

Kentucky, which makes about 95 percent of all bourbon, exported nearly $200 million to EU countries last year and more than $450 million worldwide. Louisville-based Brown-Forman also makes Jack Daniel's, which is Tennessee whiskey but considered bourbon by foreign countries who are adding tariffs in retaliation for President Trump's protectionist tariff on steel and aluminum.

Senate Majority Leader Mitch McConnell has said he opposes the tariffs but hasn't swayed Trump so far.

Jack Daniel's is by far the biggest selling American whiskey in the world. Jim Beam, the best-selling bourbon, is made in Kentucky as are other top-selling global brands including Evan Williams, Wild Turkey, Four Roses and Bulleit.

The sixth district congressman, who is in a tight race against Democratic challenger Amy McGrath, said he shared with the Treasury secretary how "economically important the bourbon distilling industry is for our economy, for jobs."

Mnuchin was receptive to Kentucky's position, he said. Bourbon, produced in McConnell's home state, has been targeted by Europe, China, Mexico and, soon, Canada to create political pressure on Trump to drop the tariffs.

"I told (Mnuchin) I share the objective of reciprocal, free trade but in the meantime, this is creating a lot of concern that there could be some serious disruption over our export opportunities," Barr said.

As chairman of the House Committee on Financial Services' subcommittee on Monetary Police and Trade, Barr is pushing for a hearing in the full committee to provide some oversight over the administration's trade policies, he said.

Will Barr's meeting have any effect on Kentucky's bourbon exports? It's hard to tell. But Mnuchin stopped to give Barr a literal pat on the back and thumbs' up during a TV interview.



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