Just because the GOP is calling it a liquor privatization bill doesn’t actually mean that they are doing away with a government monopoly, cutting costs, or leading the fight for a remotely smaller government.
No, in fact, the leader of the new “amended” bill here in Pennsylvania that would end the complete control of all wine & liquor sales by the government is bragging about how he made certain to cut the private markets out of the picture by pricing the licenses to compete out of the range they were willing to accept. That’s right, the GOP lawmakers are bragging about trying to shut out the free market.
The current proposal will allow places that currently sell beer to sell wine, but only after they pay $50,000, plus an additional $15,000 every year after that. Oh, and if it’s a grocery store, we have to keep the same inconvenient current model of going to buy groceries from one part of the store, checking out, buying alcohol (beer only, for now) from another part of the store, and checking out yet again. Explain to me how this is an improvement.
Effectively, the state will still control prices and selection. While there is a wholesaler license available, GOP Rep. John Taylor from Philly purposefully priced it out of what he believes the market will pay at $100 million:
Taylor said he arrived at that figure by asking several groups what they would pay for a license to sell wine to retailers and then adding a few million. (emphasis added)
So, what we get is the perfect example crony capitalism. The prices are set based on private conversations that a lawmaker won’t reveal to potentially favor or disfavor anyone he chooses.
I also see this as potential burden for taxpayers. Sebastian and I sketched out this possible scenario last night while talking about the unbelievably stupid bill:
Continue reading “Republicans Sell Out the Free Market – Again”