The Booze Market We Need

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This Letter to the Editor of the Tribune-Review sums it up:

Here’s the deal: Anyone with a simple retail business license can buy liquor in bulk and sell it at retail for whatever price the market will bear. No special deals for beer distributors. No more special deal for state employees. No big fees for licenses, no buddy-buddy arrangements. Just straight business. Sell to minors, go to jail. The market will determine which stores will prosper and which will not.

I chopped out the paragraphs bookending it that equate Americanness with free enterprise so as not to alienate my lefty friends, but there’s nothing in here that’s in contradiction with being a liberal Democrat.

Liberals like Big Government because they support the big social insurance programs, want more economic power for lower and middle income people, want less unfair exercise of political power by businesses, want protections from pollution and other externalities, and are more comfortable using paternalistic regulation and taxes to achieve these policies. That’s what distinguishes us from conservatives and libertarians.

Our endgame is not for the government to directly own or run businesses. It is not for us to centrally plan how many jobs selling alcohol the economy should have, any more than it would be to centrally plan how many grocery store jobs or yoga instructor jobs the economy should have. That’s what distinguishes liberal Democrats from Marxists.

Our interest in the liquor market is in making sure that the public harms of alcohol abuse are tightly controlled. It’s not unthinkable in theory that state control might be the best way to control the public harms of alcohol, but in practice, we know that restricting private alcohol sales hasn’t gotten us better safety outcomes than other states, minors don’t have a harder time getting alcohol than in other states, and alcoholism isn’t less prominent than in other states with private sales.

It’s time for Democrats to admit that this isn’t buying us any extra harm reduction, and shift the focus to regulating alcohol on the demand side, through taxes and penalties, rather than restricting who’s allowed to sell alcohol and how much.

This entry was posted in Economic Development, Economy, Health, Labor and Unions.

4 Responses to The Booze Market We Need

  1. Girondin says:

    If the impetus to privatization is, in part, retaining alcohol sales as a revenue source for the state, is the outlook all that rosy?

    http://keystoneresearch.org/publications/research/PFM-beware-free-lunch

    If this study still applies, variety and ease of accessibility will have to outweigh cost, for consumption to remain as high as it currently is. If sales decline, though, I don’t necessarily put that in the “con” column.

    Seeing as the studies show state alcohol revenue as declining under privatization, this pairs nicely with cuts in education funding.

    If there are more recent studies, I’d love to read them. Until then, I remain progressively skeptical.

  2. Albert Brooks says:

    The PFM study does not apply to any plan currently in the house or senate. There are no new studies that I am aware of.

    I don’t believe the impetus for privatization is to keep or retain state revenue it is to increase the selection, service and convenience not provided by the current system and on an ideological front, to get government out of retail and decrease its size. That said, there is evidence that a private system will return the same if not more to the state although maybe not all in direct liquor revenue. It has nothing to do with education funding.

  3. Shellie says:

    I know this statement is going to make my husband and me sound like major boozers…
    We are from MD. We like our alcohol just as much as the next “drinker”. We go back to buy our booze. What we are saving way out weighs what we spend in gas. I don’t see any reason not to privatize the liquor stores. Did someone say funding education? The answer is so simple. Tax clothes and shoes 2%. Continue to have tax free shopping for seniors and at the beginning of the school year. Our border states will still come her to shop. I don’t understand why this is such a difficult issue to grasp.

    • Lew Bryson says:

      Agreed, Shellie: every time we make a booze run to New Jersey (about every 6 weeks), I find that what we saved over buying in PA more than makes up for the fuel we burned getting there (even more so when we take the opportunity to fuel up in NJ, where diesel wasn’t overtaxed like it just was in PA); we’re often ahead by $20-50, depending on how much we buy. It’s illegal, it’s somewhat inconvenient, and it costs Pennsylvania tax revenue…and if the Legislature would privatize the State Store System, we’d happily stop doing it. Until then, if they won’t give us privatization of liquor stores, we’ll just keep crossing the Delaware into New Jersey and grab hold of it ourselves.