Alcohol Reform and Wages

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I really do not understand why some people think that directly paying a couple thousand people higher-than-market wages puts us on track to achieve any progressive goals at all. There is no strategic win that I can see.

For instance, you’re never going to nationalize all the retail businesses, so it’s not like you can universalize this strategy to get retail workers higher wages.

And it’s not like there is an opportunity to raise private sector wages the normal union way. If there were some competition between public liquor stores and private liquor stores, and the higher public store wages put upward pressure on the private employee wages, that could work. But it’s a monopoly, there is no wage competition between companies!

Best I can tell, there is no theory of change here as to how to win higher wages for all retail workers. It’s really just about protecting the nice deal that these specific incumbent workers have. Which is fine. You’d expect the incumbent workers and the unions that represent them to want that.

But there’s just no persuasive way to situate this into the larger progressive project of rising living standards for all workers. There’s no lesson to derive from it, no strategy, no nothing except protecting incumbents.

On the other side, look at what you could potentially get if you liberalize this market:

– Higher craft beer wages/profits. This is a fast-growing sector, especially in PA. These are the “manufacturing” jobs people say they want. Expanding the market for craft beer by letting grocery stores sell beer will create demand for more of these jobs.

– Expanding the number of tavern liquor licenses would raise restaurant industry wages

– Expanding the number of bars and restaurants helps you (granted, slowly) turn around some older downtowns and mid-sized cities that are starting to come back. More growth in the Act 47 cities (almost all older core downtowns) helps you prevent more layoffs of workers doing the real key public services.

– Supermarkets and some other retailers get some new high-markup items. Who gets the windfall profits? That opens up a nice new argument for the minimum wage battles. Some of the companies crying poverty – your Wal-marts, your 7-11s, the mom and pop convenience stores – are going to be making some more money and won’t have a good excuse for not sharing it with their employees.

To me all these other wins, combined with the solid arguments for greater consumer choice and convenience, make alcohol market liberalization an easily more progressive position than protecting incumbents and retaining the state monopoly.

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