I’ll be honest, mates – numbers and figures make my head hurt. But take a gander at Cap’n Jimbo’s writeup about massive rum subsidies that provide an unfair competitive advantage to three huge rum producers at the expense of the little guys and I think you’ll agree it looks a right mess. An excerpt:
Then things got much, much worse when the USVI instituted a “rum war” against Puerto Rico last year. What happened is almost unthinkable. The USVI gave Diageo nearly $3 Billion – not million, billion! – in subsidies. These subsidies were so rich that they amount to more than double the cost of actually producing rum! Diageo is actually being paid to produce rum. The USVI also gifted Fortune Brands (Cruzan) $1 Billion, yes billion – for all manner of free improvements and facilities, including a guarantee that Cruzan can buy molasses for just 16 cents/gallon – far under the market price of $2.00/gallon that the Caribbean producers must pay.
The risk is that we lose the small rums we all love, and are left with naught but a few mega-rums, one of which is Bacardi of all things (crikey, I might have to go back to drinking water instead.)
You can read the full article over at CanadianWhisky.org, and then consider signing the petition. But whats more, keep buying your favorite rums, mates – they need our support, now and always!
At first this sounds unfair to other rum producers ,but i lived in the US Virgin islands since 1983 and have a dog in this race .
The Island of St Croix where Captain Morgan rum is located as well as Cruzan Rum is a god send to our island .
Our economy was just delt a major blow when the Hess oil refinery closed over a year ago …….
We also have pay 4 to 5 times then state side for our electricity because we use oil to produce it which makes it also hard on businesses and people in general (Dumb).
If it wasn’t for this rum tax program , my island of St Croix would have extreme hardships . It really scares me to even think how bad it would be.
We don’t really have a tourist oriented economy here on St Croix , nor the cruise ships of the other islands !
Remember that this benefits The US Virgin Islands as well as Puerto Rico which is also US which should always come first , Period !
Thanks for the additional perspective on this subject – whenever I come across these sort of issues I always wonder how much more there might be to the story. Oftentimes things are a might bit more complicated than they first appear, which can be a comfort in its own odd way.
What Mike said. And it’s good to recall that the USVI did not start the rum war. Captain Morgan’s had already planned to announce they were leaving Puerto Rico and were looking at sites in Guatemala and, if memory services, Panama, when the VI stepped in. Puerto Rico got pissed off because they would have reaped more in rum revenue if Capt. Morgan’s was produced in another country than in a U.S. territory.
I’m sure that all of us appreciate the issues of poverty, both here in the US and in the Caribbean. But let us not be fooled. The billions given to Diageo is expected to create no more than 40 jobs in the USVI!
What we really have here are two humongous corporations fighting over billions in free money for which a few hundred jobs may be lost or created.
We must not be distracted from the really big picture: that by subsidizing two hugely profitable foreign corporations, we threaten the entire Caribbean rum industry and the relatively small producers of Barbados, Jamaica, the DR, Cuba, Haiti and many more – none of whom can compete against these rapacious megacorporations whose lobbying and payoffs have, well, paid off.
Don’t be fooled. No less than Dave Broom, among many other experts in spirits, well understand the problem and issues, and who agree these subsidies threaten Caribbean rum.