Later this month, Pennsylvania lawmakers will return to debate privatizing state-owned liquor stores. Yes, for our friends in California, Texas, Florida or any of the 30 states that have never seen a government-run liquor store, Pennsylvania state government remains in the business of selling alcohol to its residents. Pennsylvania is one of only two states in the nation (Utah being the other) with complete government control of wine and spirits sales.
The Pennsylvania Liquor Control Board’s (PLCB) recent failures help demonstrate why government in the booze business is a lose business. In a notable example, the agency tried its own form of Perestroika, allowing wine to be sold in grocery stores through wine kiosks: Rube Goldberg-like contraptions in which consumers would blow into a breathalyzer and show ID through video to a state worker sitting in the PLCB’s central office.
The program was a catastrophe from the start, as many – including the PLCB’s own advisory committee – predicted. The machines broke down during the Christmas rush and the kiosk contractor now reportedly owes the state $1 million (a cynic might point out the contractor has deep ties to former Governor Ed Rendell). Wegman’s, one of the state’s largest grocery chains, dropped all wine kiosks in June. This week, state Auditor General Jack Wagner released a report declaring the program a failure. The Philadelphia Inquirer said of the fiasco, “Rarely before has any government agency so succinctly, thoroughly, and convincingly made the case for its own elimination.”
Although Pennsylvania and Utah are the only states with a complete government monopoly on liquor sales, other states continue to fight for libation liberation. State liquor store privatization remains a hot issue in Washington and Virginia where, although private stores are permitted to carry wine, government control still remains.
The latest effort to get government out of the booze business is spearheaded by House Majority Leader Mike Turzai (R-Pittsburgh). His proposal calls for auctioning off 1,250 liquor store licenses (up from Pennsylvania’s current 650 stores), divesting the wholesale operations, and selling off the state store inventory. With Republicans controlling both the state House and Senate, and Gov. Tom Corbett supporting privatization, momentum is building to enact liquor liberty this year.
A well-funded counter effort is mounting by those with vested interests in preserving the status quo . Already, the United Food and Commercial Workers union (the union representing government liquor store clerks) has launched radio attack ads against legislators supporting privatization.
Such an effort would be against the will of Pennsylvania voters who, having seen the prices and selection at private retailers in other states, overwhelmingly support introducing competition at home. A taxpayer-funded study commissioned by the PLCB found that 45 percent of drinkers in the Philadelphia region shop for wine and liquor in other states – even though it is illegal to bring alcohol back across state lines. The latest poll – which echoes previous results – shows that 69 percent of Pennsylvania voters support liquor store privatization.
While many subscribe to the belief that government control of liquor is necessary for safety, the facts just don’t add up. Pennsylvania has a higher rate of alcohol-related traffic fatalities and total alcohol-related deaths than neighboring states Ohio, New York, Maryland, and New Jersey. Moreover, the Keystone State has higher rates of underage drinking and binge drinking than the nation as a whole, and a 2009 study by John Pulito and Antony Davies shows no connection between state-run liquor businesses and negative social impacts.
It may be now or never for lawmakers to let loose liquor liberty in the State of Independence.
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