Alcohol

Fearing 'Monsters' Like Total Wine, Liquor Sellers Want the State to Keep Prices High

Connecticut is the only state that sets minimum prices for wine and spirits.

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Office of the Governor

In 2012 Connecticut Gov. Dannel Malloy persuaded state legislators to allow Sunday liquor sales, and last year he won approval of a law that allows liquor stores to stay open an additional hour. Now he is urging legislators to abolish a state-backed price fixing scheme that he says forces Connecticut drinkers to pay an extra $4 to $12 per bottle. In my latest Forbes column, I note that the debate over Malloy's proposal pits free-market Democrats against protectionist Republicans:

Last summer, when Pennsylvania's governor vetoed a bill that would have privatized liquor and wine sales in that state, he argued that inviting private businesses to compete for drinkers' dollars would raise prices. This week, as Connecticut legislators considered a bill that would eliminate minimum legal prices for liquor and wine, opponents argued that consumers would end up paying more as a result.

Alcohol sure makes people say funny things. In Connecticut's case, the liquor merchants who benefit from a 35-year-old protectionist scheme that discourages price competition want legislators to believe that system is good for consumers. And even though Connecticut is the only state in the country that sets minimum prices for liquor and wine, supporters of that policy act as if the alternative—allowing the market to set prices—is unthinkable.

"The whole purpose here, the whole result would be to give business to the box store who is trying to take over everybody's business in Connecticut," Carroll Hughes, chief lobbyist for the Connecticut Package Store Association, told the Associated Press. The trade group warns that abolishing minimum prices will drive half of the state's 1,150 liquor stores out of business, eliminating 2,100 jobs. "If we had a 2,100-employee company going belly up in Connecticut," Hughes said, "we'd be falling all over ourselves trying to help them survive." 

Unlike Pennsylvania Gov. Tom Wolf, who parrots the self-interested talking points of privatization opponents, Connecticut Gov. Dannel Malloy is standing up for drinkers. "Why would government force residents to pay artificially high prices?" he asked in an interview with the Hartford Courant. "It's illogical and backwards. We need to be competitive with surrounding states, who have lower prices—and we need to let the market work instead of allowing backwards laws to remain on the books."

Read the whole thing.

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  1. I think Pennsylvania technically sets a minimum price for spirits; as far as I know they’re the only legal seller within the state.

    1. Also, Fist….er first.

      1. Forbes doesn’t let me have my ad blocker so Sullum is deprived of my commentary.

    2. Plenty of other states are like that too, especially on the east coast.

      1. Yeah. This article is off. According to the Mackinac Center, 18 states have minimum pricing.

    3. No, there’s a flat bottle charge that applies equally, though.

  2. I’m not sure about “the only state that sets minimum prices” – Georgia prohibits selling below cost so the clearance sale dusty old bottles of wine at Publix has a sign on it saying by law that’s as low as the price can go. That may be a different kind of minimum price.

    “If we had a 2,100-employee company going belly up in Connecticut,” Hughes said, “we’d be falling all over ourselves trying to help them survive.”

    Yes indeed we would. And that’s the whole damn problem, interfering with the efficient working of the free market for political purposes. That’s 2100 people who are getting paid for doing jobs that don’t need to be done and you thik that’s a fine idea to waste their labor.

    1. “If we had a 2,100-employee company going belly up in Connecticut,” Hughes said, “we’d be falling all over ourselves trying to help them survive.”

      Of course there’s no way another company could come along to fill that gap with better products and services and employing many of the same people. Nah, that bit of the market will just go empty and all those experienced employees will just go on welfare. Why not just come right out and say that the trade group paid for protection during his last campaign, so they’re going to get it?

  3. the debate over Malloy’s proposal pits free-market Democrats against protectionist Republicans:

    Let it never be said that either party is principled. They are tribes seeking to enrich their members at the expense of other tribes. They are raiders and barbarians, nothing more.

    1. The only thing that gives me hope is most people don’t vote. I use to buy into the propaganda that if you’re not voting you don’t get to complain. Now I think non-voters are the people who get it, “it” being the average joe has effectively no influence on what the government does.

      1. I dunno. It looks to me like a whole bunch of average (well, ok, maybe below average) Joes are about to nominate Trump for president. That certainly has the potential to influence what the government does.

        1. That’s my point. You think trump is a clown, what can you do to stop it? Not much except vote Rubio, Hiliary, Cruz or sanders. I’m not convinced any of those are really any different in the grand scheme.

          1. The difference between a Cirque du Soleil clown, a rodeo clown, a Barnum and Bailey clown and a drunken birthday party clown?

            1. Nicely done.

              *tosses franc into tin cup*

              That’s Swiss money, right?

      2. 3,000 average joes who work at PA liquor stores have stymied privatization for decades.

  4. Connecticut Gov. Dannel Malloy is standing up for drinkers. “Why would government force residents to pay artificially high prices?” he asked in an interview with the Hartford Courant. “It’s illogical and backwards. We need to be competitive with surrounding states, who have lower prices?and we need to let the market work instead of allowing backwards laws to remain on the books.”

    I bet ole Dannel has no issue with Connecticut’s cigarette tax. Fuck Gov. Malloy and his selectively applied principles

  5. Michigan has minimum prices for beer/wine/liquor.

    1. My bad, it’s liquor only.

      1. But they limit price changes to beer and wine which essentially let’s state set pricing.

  6. Pennsylvania update: Democratic governor would gnaw his foot off before he will sign privatization and screw the union liquor store clerks who helped elect him.

    But that’s not the real problem. The real problem is the GOP Senate, who have union and liquor store beholden senators from southeast PA who want “modernization” instead of privatization. Those rat bastards. The GOP House passed privatization and are holding tough on it being part of the budget. Which is one of the reasons why we don’t have a passed budget.

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