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Privatize Booze

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Whoever says that state budget crises are all bad doesn’t know what they are talking about. Now, I know that schools suffer, social services for the poor get tight, and everything from state parks to public hospitals cut back on services, but good can come out of it as well. Take for example the many states that are currently looking for ways to increase revenue and decrease costs by privatizing the sale of alcoholic beverages. It is a move that is way past due.

Nineteen states still maintain Prohibition era laws in which the state retains the sole right to distribute wine and spirits. As Prohibition died a justified death about 77 years ago, many state leaders justify the archaic state control laws with the rationale that without tight government control of booze underage drinking, driving while intoxicated, and domestic abuse cases would skyrocket. Well, on the surface that doesn’t seem to be the case in those 31 states where a private system of distribution exists. Additionally, it is not like state regulation of the behaviors associated with alcohol consumption will go away if states divest from the booze distribution business. You will still be dealt with harshly if you drink and drive. No, state control advocates have no legs to stand on here.

Now, I grew up in Pennsylvania which is a liquor control state. Pennsylvania’s system is a total joke. In the Keystone State you buy beer through a licensed private beer distributor. Go to one to buy just a six-pack and you will be told that under state law you must buy a whole case. Wines and spirits can only be purchased at state run stores. Naturally, the service is awful, the hours are short, and the selection is limited. What would you expect from a state run business?

The biggest issue, at least with Pennsylvania’s control system, is expense to the consumer and Pennsylvanian’s have no way to legally circumvent the law. If Joe Six-Pack from Northeast Philly decides he wants to save a few bucks on a bottle of Southern Comfort by driving over the Tacony Bridge into southern New Jersey he better think again. The way the law is written buying his hooch in a neighboring state could land him in jail for 90 days. Usually though, the officer in the unmarked Pennsylvania police car that waited for folks with PA tags to buy liquor at the New Jersey store just fines the driver per bottle purchased.

I could never understand how the Pennsylvania law was not a violation of the interstate commerce clause of the Constitution. Taken in its original meaning, the clause allowed Congress to remove obstructions to trade between states. As a Pennsylvanian I could go to Jersey to buy a car, but I better not buy alcohol because the state owns the monopoly on that business. This is clearly one of those rare yet constitutional instances where it is totally within the jurisdiction of Congress to step in and regulate Pennsylvania’s anti-consumer and anti-free trade laws away.

The bottom line is that selling alcoholic beverages is a retail activity not meant to be done by any government. The moralists can say that state control is necessary in order to prevent the decay of society. Many would even argue that the system works well and there is no need for change. With so many other problems facing the states in this depression who sells alcohol is of little consequence. But, remember the point of this article was that state budget crises are not all bad. If antiquated state liquor control systems like the one in Pennsylvania are terminated then some good has come out of it.


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About Kenn Jacobine

  • Dave Nalle

    Kenn, my college roommate who is now a very successful writer and editor in the area of beer and liquor runs a blog about exactly this subject which you (and others) ought to check out – NoPLCB.