From an op/ed by an Oregon liquor store agent on why we shouldn’t privatize liquor sales:
A net revenue of $163.5 million (fiscal 2008-2009) just from liquor sales was returned to the citizens of Oregon. What retail business can generate net profit revenues of 40 percent of sales? I’d sure like to invest in such a company. Even a wildly successful company like Apple posted only a 19.9 percent net profit margin for 2009, which is far less than what OLCC liquor revenue generated for Oregonians.
And in the same article:
If the citizens of Oregon think that getting the state out of liquor distribution and retailing will reduce the price of alcohol at the checkout counter, think again. I’ve compared retail prices in California and Arizona to ours in Oregon, and except for the best-sellers (less than 10 percent of the inventory) the prices are the same or higher in those states.
So his arguments are that 1) monopoly liquor distribution yields enormous excess profits for the state and 2) introducing competition will increase prices for consumers. If this is the best the anti-privatization side can come up with, I think it’s safe to say the pro-privatization side wins the economic argument.
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Though the previous post mentions one relic of Prohibition falling away in Oregon, plenty of others live on. Here’s the latest asinine ruling from the Oregon DOJ and OLCC:
Law enforcement officials are putting a stop to the home-brew and home-wine-making competitions at this year’s Oregon State Fair.
KATU reported on the glitch in state law that at the time put the home-brewing competition in jeopardy. Late Friday, Oregon State Fair Manager Connie Bradley learned from the Department of Justice that the law requires both its beer and wine competitions to be shut down.
“The issue has to do with the judging,” Bradley said Monday. “Judges are considered the public, and we cannot have the public tasting amateur wine or beer.”
The competitions have been going on for 30 years under existing law. The agencies have just now decided to interpret the rule to mean that allowing judges to taste homemade beers and wine counts as serving to the public.
People actually get paid with tax dollars to enforce these stupid rules. With the state budget in a mess and OLCC privatization an issue in upcoming elections, hopefully this will be one more nail in the coffin of one of our least useful agencies.
[Via Beervana.]
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Republican candidate for governor Chris Dudley has added Oregon to the list of control states considering privatization of their liquor markets. Elizabeth Hovde explains:
Some people want the state to monopolize the liquor business because they feel safer with it in charge. They believe that with limited access and price controls, the social problems associated with overconsumption are limited as well. But it’s hard to argue that a state monopoly on liquor helps curb alcoholism when distilled spirits are available at more than 200 liquor outlets, and wine and beer are already sold in grocery stores.
Dudley and others pushing privatization in Oregon need to make clear that current safety measures on alcohol sales would not be sacrificed, that the OLCC would keep its public safety functions and that any change in sales would be revenue-neutral to state, city and county budgets. Once that’s handled, the philosophical argument against a liquor monopoly is easy to sell.
Previously covered: OLCC’s “secret happy hour” requirement and anti-consumer special order policies.
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Patrick Emerson notes that the Oregon Liquor Control Commission is considering getting rid of one its more pointless regulations: the ban on bars and restaurants advertising their happy hour specials. As Patrick notes, the ban prevents customers from getting useful information about prices and availability. It’s an archaic rule that’s long overdue for repeal.
Eventually I’d like to see the OLCC abolished altogether, but for now I’ll be happy with baby steps.
Previously:
Caleb Brown and Austin Bragg take on the Virginia ABC, one of the few state agencies that make the OLCC look good by comparison.
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The good news: Oregon may have a marijuana legalization measure on the ballot soon. The bad news: It would give the state a monopoly on cannabis sales:
[Legalization advocates] plan to put the issue on the 2010 ballot with an initiative called the Oregon Cannabis Tax Act.
If they can gather 87,000 signatures to put it on the ballot, and voters then approved the initiative, the act would set up the Oregon Cannabis Control Commission. The new agency would sell pot to buyers 21 and over, with 90 percent of the profit going to the state’s general fund and 10 percent for drug treatment.
Activists last put a legalization measure on the ballot in 1986. It got just 26 percent support. But after decades fighting to legalize pot in Oregon, they believe the public has come around.
Have we learned nothing from the Oregon Liquor Control Commission? If we do this, it will take us forever to get new, artisinal brands of pot on the market, “coffeehouse” owners will lose money for months while they wait for licenses, and all the coolest cafes will open in California.
Here’s my idea for a compromise measure: Attach a rider eliminating the OLCC, transferring all its employees to the OCCC. Pot smokers are more relaxed than drinkers anyway, making them much better equipped to deal with lazy agency bureaucrats.
For a glimpse of what happens when the government is the sole distributor of a good, be sure to check out Doug’s write-up of the current state of liquor sales in Washington state. It’s hard to find stories that make the OLCC look good in comparison, but this is one of them.
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The Oregon Liquor Control Commission has started publishing an amusing blog. Many of the posts consists of the author explaining how, contrary to popular opinion, the OLCC is not actually a totally archaic government agency that taxes bartenders for the right to work and annoys everyone with their petty regulations. For example:
Did you know that you can special order virtually any item that is not normally carried in the OLCC’s product line? As long as it is available from a source in the U.S., we can probably get it.
Oh, that’s nice. How do I place an order?
You can go to any liquor store to place your special order. The store will write up your request, and submit it to the OLCC for processing. Your order is then placed to the distillery. The distiller will ship your order to OLCC’s warehouse, where it will be transferred to the liquor store. The liquor store will notify you when your items arrive. Special orders generally take about six to eight weeks.
Six to eight weeks? Wow, that’s really fast! OK, anything else I should know?
One thing to note - you must buy this item by the case. This is necessary since suppliers will not ship in less than whole case quantities.
Fantastic! When I’m trying out new, obscure liquors, I need at least a dozen bottles to give them a fair assessment.
(As a point of contrast, my DC liquor store would deliver special orders in less than two weeks, set a bottle aside for me, and put the rest of the case on sale to the public. Even direct mail shipments from Europe arrive in just a few days.)
[Via Things About Portland that Suck, of which the OLCC is definitely one.]
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Jacob Grier is a freelance writer, barista, mixologist, and magician in Portland, OR. He writes, eats, and drinks a lot. His articles have appeared in The Washington Post, Reason Online, The Oregonian, and other publications.
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