Few things are more difficult to eradicate in our system of modern governance than a government-sanctioned monopoly or oligopoly. A recently passed bill in Tennessee, which will allow the state's alcohol wholesalers to take over hemp distribution in the state, shows that these monopolies are not only difficult to eliminate but also often attempt to expand their reach.
The new law sets up a distribution system for hemp—which was legalized at the federal level in the 2018 Farm Bill—that mirrors the notorious three-tier system for alcohol distribution, which requires producers, wholesalers, and retailers to be legally separate entities. The three-tier system restricts producers and suppliers from selling directly to their customers and mandates that they work through a wholesaler to reach the market. This allows wholesalers to operate as functional monopolies or oligopolies in certain parts of states where only one or two wholesalers operate.
