May 16, 2017
Beth Anne Mumford
The season of backyard barbecues is upon us. In Pennsylvania, that means numerous trips to the store: one place to pick up the food, another shop to grab the beer and daiquiri fixings, and still another place for wine.
Talk about a buzz kill.
But now, state lawmakers can take steps toward ending the ridiculous rigmarole. Legislation recently passed by the Pennsylvania House would at least end Harrisburg’s control over the wine and spirits market, which benefits a few powerful special interests at the expense of ordinary Pennsylvanians. Unfortunately, beer distribution would remain unchanged; it will continue to be sold only at the beer distributor and a few select grocery stores.
Currently, through the Pennsylvania Liquor Control Board (PLCB), government bureaucrats decide what you drink and how much you pay — a situation that has remained largely unchanged since the end of Prohibition.
“As you might expect, consumers often face higher prices and less selection as a result,” noted Case Western University Law School professor Jonathan Adler in The Washington Post. The average bottle of wine costs more in Pennsylvania than in all six of our neighboring states, and the price of a six pack of beer can run higher than in five of our neighboring states.
And there are fewer places to purchase our more expensive beer, wine, and spirits. For example, a typical state has three liquor stores per 10,000 adults; Pennsylvania has one. When it comes to wine, we have just one wine store per 15,365 adults over 21. Compare that with Ohio, which boasts one wine outlet per 998 adults; Maryland, one per 2,602 adults; or New York, one per 5,841 adults. The lack of competition in Pennsylvania means these stores can charge us higher prices. Competition among stores in other states drives down prices and encourages them to carry a wider selection of beer, wine, and other libations — a win-win for those consumers.
Price and selection aren’t the only things we miss out on. Our economy loses more than $92 million as smart Pennsylvania shoppers take advantage of the lower prices and better selection outside of our borders.
Even worse, the government monopoly robs entrepreneurs of the opportunity to open mom ‘n pop stores that can best serve the needs of our unique communities and create local jobs. In fact, when previous attempts to privatize spirits sales in Pennsylvania failed, taxpayers lost out on $200 million in potential state revenues in just the first year.
Missed opportunities are just the beginning of expenses taxpayers incur as a result of Harrisburg’s monopoly. In 2014, the State Ethics Commission found “rampant corruption and abuse” at the PLCB, where “three former senior PLCB officials … were accused of using their government positions for personal gain and ordered to repay the commonwealth,” as the Harrisburg-based Commonwealth Foundation reports.
Blatant incompetence has also cost taxpayers a pretty penny.
In 2011, the PLCB spent more than $66 million in taxpayer dollars on an inventory system that resulted in “widespread shortages and surpluses at PLCB distribution centers, crippling commerce, and costing 2.5 times the original plans…with estimates nearing $100 million,” according to the Commonwealth Foundation.
In a bungled attempt to correct their error, the PLCB told purchasers to order more inventory to fill in the shortages, which led to a surplus. The surplus items were then stored in non-temperature controlled trailers “at a cost to taxpayers of more than $500,000.”
Government bureaucrats just cannot anticipate the needs of shoppers as well as private store owners who know their customers and understand the market.
More than two-thirds of Pennsylvania voters agree that there is no compelling reason to leave the PLCB in control. In the 48 states that do not have a government monopoly on liquor sales, debauchery and chaos have not ensued. Instead, responsible adults can conveniently purchase their drinks of choice at a variety of stores — large wholesale markets, grocery chains, and small stores catering to enthusiasts. We deserve the same options here in Pennsylvania.
Politicians in Harrisburg must stop putting the special interests who profit from the status quo ahead of Pennsylvania consumers and taxpayers. State senators should swiftly pass legislation to free our spirits and urge the governor to sign these bills when they arrive on his desk.
— Beth Anne Mumford is the Pennsylvania state director of Americans for Prosperity.