Vodka, Gay Rights, and the New Cold War
Stolichnaya vodka has been a trademark product of Russia since 1950. It’s as Russian a symbol as Jim Beam Bourbon is to the U.S. (disregarding the fact that the Japanese firm Santory now owns Jim Beam).
But Valdimir Putin and even Donald Trump have to realize you can’t stop globalization. And Stoli now says it’s Latvian.
Ever since the breakup of the Soviet Union there has been an ongoing vodka war. It involves threats from Vladimir Putin: charges of theft of state assets, corruption, gay rights, boycotts, international intrigue, and tax evasion. And Latvia, the little Baltic country once known as a captive republic within the Soviet Union, is right in the thick of it.
During the Soviet era, Latvians and other Baltics would boycott Stoli and lead protests against Stalin in front of liquor stores. More recently gays in the U.S. urged a boycott of Stoli to protest Russian President Vladimir Putin’s policies against gays in Russia. According to the New York Times, Stoli went out to the gay community in the U.S. and “mounted a vigorous campaign to show that it is not Russian, that it does not see the Kremlin’s take on homosexuality and is a fervent supporter of those who are lesbian, gay, bisexual or transgender.”
But here’s the rub. Stoli is no longer solely Russian, but produced in Latvia, an adversary of Putin and a member of NATO. NATO recently placed U.S. tanks, a squadron of F-22s, and Predator drones in Latvia to protect its borders from Putin.
Actually Stoli is now a global company like many others. This is how the New York Times described Stoli’s nationality in a 2013 story:
The exact nationality of Stolichnaya like many global brands is hard to pin down as it is simply bottled in Latvia. The water (vodka is merely the Russian word for little water) is Latvian but it’s main ingredient raw alcohol distilled from grain still comes from Russia, operates a distillery near the Russian town of Tambov to produce the raw alcohol for shipment, its bottles are from Poland and Estonia, and caps from Italy and the company is chartered in Luxembourg.
The short version is that Putin wants to take the company over for himself from Yury Shefler who bought the company in 1992. Putin claims it was stolen. Shefler got the deal of a lifetime when he bought the name in 1992 for just $300,000. According to Bloomberg News, Stoli’s worldwide sales today are around $2.5 billion and U.S. sales around $500 million; it’s the third most popular vodka after U.S.-made Smirnoff and Sweden’s ABSOLUT.
Putin regards Shefler as a thief and he will be arrested if he sets foot in Russia. But since 2006 a U.S. court ruled that only Shefler’s company, S.P.I., can use the Stolichnaya name in the U.S. You never knew all the international intrigue going on in the liquor aisle at grocery stores.
John Freivalds is principal of JFA, Inc., an international communications firm based in Wayzata, Minnesota.
The Shifting US-China Trade Landscape