The views expressed in Guest Opinions represent only those of the author and are in no way endorsed by Richmond BizSense or any BizSense staff member.
Virginia keeps changing its plan for how its residents can buy booze. First Gov. Bob McDonnell wanted to privatize the stores. Now that plan has slowed. And just this week, the state wants to prevent the sale of caffeinated malt liquor, which apparently causes people to turn crazy.
To anyone who seriously thinks that the state should stay in the liquor business, ask yourself: How did we get into it in the first place?
Privatization represents a radical change to the status quo, so this question should be asked by proponents and opponents alike.
I was surprised to learn that the system can be traced to a special election in which the citizens of Virginia voted almost 2 to 1 to create state control of alcoholic beverages.
The vote was taken in a special election called for the purpose of ratifying the 21st Amendment (repealing federal prohibition). But the people did not vote to put the state in the booze business. They voted to authorize a system of state control.
The General Assembly took it from there. A committee was created, a study ensued, and it was decided that the best system for Virginia was a hybrid. The state would have a monopoly on the hard stuff, but beer and wine would be sold by licensed retailers, modeled on the system of — get this — Quebec. I kid you not. It’s on the ABC website. And it’s not as if Quebec’s system had a long history, either. It was created in the wake of the repeal of Canadian Prohibition, just a few years before. So when you debate the virtues or evils of the ABC system, it’s worth remembering that it was not ordained by Mr. Jefferson, debated by James Madison and George Mason, or even denounced by Patrick Henry. It’s from Canada, courtesy of the Byrd Machine. And it’s a safe bet that the potential for profit did not escape the committee members.
So here we are in 2010, and to read most of the coverage, it’s all about the money. Will the sale of the ABC store system be a good thing or a bad thing from a fiscal perspective? How many licenses should be sold? For how much? Who should control the prices?
Philosophically, I think this is all beside the point. I fundamentally oppose any system that puts the government in the business of selling products with such polarizing moral dimensions, no matter how profitable. Few would suggest that the state should create a monopoly on prostitution or crystal meth, but the revenue possibilities are potentially staggering. Is alcohol so different? For the same reason, I disdain the state lottery system, and I don’t care how much money it generates for education. How ironic that we fund our educational systems with a game that preys on the mathematically challenged. But I digress.
Discussions of ABC privatization will no doubt be further fueled by the furor over caffeinated malt beverage drinks, which the state now wants to prohibit. (You can read more about that in a news story here.) Proponents of privatization will properly posit the lack of a rational basis for a distinction between grain punch in a colorful can from the C-store versus the convenient pocket sized “airline bottles” of spirits you can buy at the ABC. You know, the ones they put up front, next to the cash register, where they no doubt generate extra profit from impulse purchases, just like candy in the checkout line at Martin’s. But then opponents of privatization might say concoctions such as Four Loko should be in the state stores, too.
I say let’s be done with it. Get the government out of the booze biz and focus more on the proper functions of modern government: the protection of personal rights and freedoms, and the defense of those who cannot defend themselves.
The views expressed in Guest Opinions represent only those of the author and are in no way endorsed by Richmond BizSense or any BizSense staff member.
Virginia keeps changing its plan for how its residents can buy booze. First Gov. Bob McDonnell wanted to privatize the stores. Now that plan has slowed. And just this week, the state wants to prevent the sale of caffeinated malt liquor, which apparently causes people to turn crazy.
To anyone who seriously thinks that the state should stay in the liquor business, ask yourself: How did we get into it in the first place?
Privatization represents a radical change to the status quo, so this question should be asked by proponents and opponents alike.
I was surprised to learn that the system can be traced to a special election in which the citizens of Virginia voted almost 2 to 1 to create state control of alcoholic beverages.
The vote was taken in a special election called for the purpose of ratifying the 21st Amendment (repealing federal prohibition). But the people did not vote to put the state in the booze business. They voted to authorize a system of state control.
The General Assembly took it from there. A committee was created, a study ensued, and it was decided that the best system for Virginia was a hybrid. The state would have a monopoly on the hard stuff, but beer and wine would be sold by licensed retailers, modeled on the system of — get this — Quebec. I kid you not. It’s on the ABC website. And it’s not as if Quebec’s system had a long history, either. It was created in the wake of the repeal of Canadian Prohibition, just a few years before. So when you debate the virtues or evils of the ABC system, it’s worth remembering that it was not ordained by Mr. Jefferson, debated by James Madison and George Mason, or even denounced by Patrick Henry. It’s from Canada, courtesy of the Byrd Machine. And it’s a safe bet that the potential for profit did not escape the committee members.
So here we are in 2010, and to read most of the coverage, it’s all about the money. Will the sale of the ABC store system be a good thing or a bad thing from a fiscal perspective? How many licenses should be sold? For how much? Who should control the prices?
Philosophically, I think this is all beside the point. I fundamentally oppose any system that puts the government in the business of selling products with such polarizing moral dimensions, no matter how profitable. Few would suggest that the state should create a monopoly on prostitution or crystal meth, but the revenue possibilities are potentially staggering. Is alcohol so different? For the same reason, I disdain the state lottery system, and I don’t care how much money it generates for education. How ironic that we fund our educational systems with a game that preys on the mathematically challenged. But I digress.
Discussions of ABC privatization will no doubt be further fueled by the furor over caffeinated malt beverage drinks, which the state now wants to prohibit. (You can read more about that in a news story here.) Proponents of privatization will properly posit the lack of a rational basis for a distinction between grain punch in a colorful can from the C-store versus the convenient pocket sized “airline bottles” of spirits you can buy at the ABC. You know, the ones they put up front, next to the cash register, where they no doubt generate extra profit from impulse purchases, just like candy in the checkout line at Martin’s. But then opponents of privatization might say concoctions such as Four Loko should be in the state stores, too.
I say let’s be done with it. Get the government out of the booze biz and focus more on the proper functions of modern government: the protection of personal rights and freedoms, and the defense of those who cannot defend themselves.
Very informative and well-done.
It is hard for me to identify examples of successful enterprise operated by the government….State ,Federal or local for that matter—-
The VA ABC system is “successful” because it is a legal monopoly. Losing monopoly profits is what politicians opposing privatizing liquor sales are upset about. Privatization is tantamount to a repeal of a tax and the politicians know that they either must raise other taxes or reduce spending.
Well put, Tom. And glad you didn’t reference this as an elitist operation. I, personally have no problem with the state being in the booze biz, but am not wedded to it, either. however, if we are going to get out of the business of selling “the hard stuff,” I propose the following: Sell as many licenses as the market will bear. The fee should be based on the sq ftage of the store, including storage areas. So, for example, if the yearly fee were $1/sf, then a place like lombardy market would pay something less than $1,000/yr, whereas a… Read more »
Virginia is so backwards on this issue it is simply ridiculous. You have the Baptists decrying the government getting out otf the liquor business because they claim we will all become alcoholics when the state gets out of the business and one can drive 2 miles to a store instead of 5 miles. You have those who have never seen anything they could not tax shouting over the revenue they may lose when the state abdicates its wrongful position as a retail purveyor of liquor. The heck with them all. Drive to DC. It is a pleasant 1.5 hour drive… Read more »
Nice Tom!!!
Agreed, the gov’t at any level should not be in the business of selling anything to consumers nor businesses. Alcohol, lottery, insurance, etc….none of it. That’s not core function of gov’t. Get back to basics and gov’t will likely be A LOT more effective and efficient, as well as less wasteful.
I love local privately-owned liquor stores. When I lived in Charleston, S.C. during college, one of my favorite shops was my neighborhood liquor store. Besides cheap booze, I liked it because it was run by a little old lady and the wall behind the counter was covered with pictures of her grandchildren and messy Crayon drawings from them and other children in the community (she was a notorious free candy dealer too.) She was very sweet and would ask about your grades, where you’d been (if you hadn’t shown up in a while), etc. However, she wasn’t nice enough to… Read more »