Privatizing Liquor Stores

There’s a measure afoot here in Washington State to privatize liquor sales here.

OLYMPIA, WA (KPLU) – A mysterious group called Modernize Washington has filed two initiatives to privatize liquor sales in the state. The move comes just days after the Washington legislature adjourned without acting on proposals to end the state’s decades old liquor monopoly.

Bainbridge Island political consultant Sharon Gilpin sent out a press release on behalf of Modernize Washington. That’s the group behind the liquor store privatization initiatives filed with Washington’s Secretary of State.

I’m going to ignore the anonymity surrounding the backers and focus instead on the issue itself – is privatizing liquor sales a good thing?

The end result will be dependent upon how the separation of the state from liquor retailing is implemented. While I believe that much good can come out of private industry taking the lead in sales, there will be those who seek to sell liquor nearly everywhere in order to make an extra buck or two, and that is the sort of attitude we don’t need. The fact that the measure is sponsored by a person who owns a few convenience stores doesn’t bode well in this regard.

My concern is for the social landscape. Right now, The State allows minimal retail locations. As of this writing, there are a grand total of twenty locations in greater metropolitan Seattle that sell bottles of booze. We could probably double that amount with no huge ill effects. But there is some number of locations that would be ‘too much’.

I got to see privatized retail liquor sales in action on a recent trip to Alberta, and there were good things and bad things to note. The good things? There were shops where the owners clearly had a passion for liquor, and great efforts were made to provide a multitude of liquors, each with their own multitude of brands. The people behind the counter were knowledgeable, helpful, and, most importantly, committed to selling good liquor.

The dark side were the cheap liquor stores that peppered the poorer neighborhoods, the way that payday loan stops and pawn shops do here in the States.

This is the direct result of privatization. To get the good, one has to deal with the bad. My own Utopian ideal would be to put one great liquor store in every neighborhood, but I realize that this will not happen. Merchants become merchants to make money, not to proselytize about great Scotch Whisky.

Many people against privatization head to the most obvious argument first – But what about the children? This argument doesn’t hold out once you explore the statistics. Most underage drinkers migrate towards beer first, mostly because it’s more cost effective. Most underage drinkers are so in a social atmosphere, and beer tends to lend itself to reaching more consumers at a lower price. There are exceptions of course, but this is primarily the case.

Additionally, there are no studies that demonstrate the adequacy of the state system over a private one in preventing underage drinkers getting their hands on liquor. Such arguments fall apart rather quickly under scrutiny.

So the question really boils down to the following: How many liquor stores do you want in your neighborhood? Privatization will mean more liquor stores in the state, and quality of said liquor stores will also become greater. We will have better liquor stores, and likely have worse as well.

More stores will also mean greater availability of liquor, which, if statistics in Alberta bear out, mean more liquor consumption, and alcohol-related crime (public consumption, drinking while driving, illegal possession, etc., etc.).

So, is privatization worth it? I’m not so sure. I’d love to see better liquor stores in Washington, and certainly better varieties of liquor. But if it means access to liquor on every corner, I’m not sure the cost is worth the benefit.

Note: If you’re really interested in Privatization, check out a report entitled Sobering Result: The Alberta Liquor Retailing Industry Ten Years after Privatization. As Alberta is the only region in Canada and the United States which can claim to have a privatized liquor retailing industry, these notes are worth looking at.

(h/t Frank G.)