Alcohol

Pennsylvania's Liquor Control Board Will Ration Booze Sales Because It Won't Admit That Prices Work

Price controls fail for other products, and liquor is no different.

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Liquor stores in Pennsylvania will begin rationing limited supplies of dozens of varieties of booze this weekend—leaving not only consumers but also bars and restaurants hung out to dry.

The Pennsylvania Liquor Control Board (PLCB), which has monopoly control over the wholesale and retail of liquor in the state, announced Friday that it would impose a two-bottle-per-day limit on 43 varieties of alcohol—mostly champagnes, whiskeys, and bourbons. In a message to license holders, the PLCB blamed "sustained supply chain disruptions and product shortages" beyond the agency's control for the new rationing rules, which will remain in place "for the foreseeable future," according to Lehigh Valley Live.

It's true that high demand and ongoing pandemic-related supply chain issues have crimped the availability of some brands of alcohol in ways that are not unique to Pennsylvania. But the real culprit here is the PLCB itself, which sets prices for products via an arcane and bureaucratic process that does not allow for abrupt changes when the market shifts in unexpected ways.

One of the amazing things about prices is that they ration goods all by themselves in response to rising demand and limited supply. In New Jersey, for example, where independent liquor stores are reporting similar supply issues, The Philadelphia Inquirer reports that "some buyers are flipping their purchases [of alcohol] at high markups."

Good! Those higher prices will deter some buyers, leaving supplies available for those who are willing to pay.

Back in Pennsylvania, however, the state's top-down pricing schemes leave no room for such adjustments. As a result, buyers are rushing to buy as much as they can at relatively lower prices. "Some places are over-ordering bottles, which leaves us with none to purchase," Teddy Sourias, who owns a company that runs six Philadelphia bars, tells the Inquirer. Without being able to rely on prices to fix this mess, the PLCB is left with few alternatives but to ration purchases.

With almost any other product, this sort of bureaucrat-controlled pricing structure would be obviously absurd. Imagine if the state decided how much retailers must charge for groceries. (Actually, you don't have to imagine it, since there are plenty of examples for how that turns out.)

There's nothing magical about alcohol that makes it immune to the basic system of supply and demand that determines the price for any other product. But until states relinquish control, you can expect to see these same problems cropping up elsewhere.

Like in North Carolina, where a similar situation unfolded in July. Liquor stores there are run at the county level, but state laws impose "a uniform pricing structure to protect against price gouging and untimely price hikes," The Charlotte Observer reported at the time. State officials in charge of the monopolistic system once again blamed supply chain issues and surging demand in the months after COVID-19 restrictions on bars and restaurants were lifted. "We all are experiencing the supply and demand shortage," Zander Guy Jr., chairman of the North Carolina Alcoholic Beverage Control Commission, told the paper.

But across the border in South Carolina, where liquor stores are privately owned and free to adjust prices as necessary to keep their shelves stocked, the Observer found products that weren't available at the time in North Carolina. And, unsurprisingly, liquor store owners said they saw an uptick in buyers coming in from out of state.

In Pennsylvania, leaving the state to buy booze is a time-honored tradition—there's a massive Total Wine within spitting distance of the Pennsylvania-Delaware border in the Philadelphia suburbs. That's because the PLCB has never been particularly good at serving customers. Indeed, the governor who created the agency in the wake of Prohibition once claimed its mission was to make it "as inconvenient and expensive as possible" to buy liquor. Mission accomplished, I guess?

Alcohol rationing in Pennsylvania is bad news for bars, restaurants, and consumers in the state—but the power of markets transcends state lines, and that's probably good news for anyone who owns a liquor store just beyond the PLCB's reach.

NEXT: Toddler-Masking Biden Says Governors Are 'Playing Politics With the Lives of…Children'

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80 responses to “Pennsylvania's Liquor Control Board Will Ration Booze Sales Because It Won't Admit That Prices Work

  1. Central planning works!

    1. Ask anyone from Soviet Russia.

      1. My Russian friends (grew up in the USSR) are remarkably pessimistic from the experience. They tell me in Russia, a pessimist says “It couldn’t get any worse” and an optimist says “Yes, it can.”

        1. In Europe, people use military time. In Soviet Russia, military use the people time.

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      3. State governments are mostly fascist, that is, you do what they want or face fines or jail or both. We need government for two things: roads and electricity and not much else. If we really were living in a free country this would not have happened. Federal government should be eliminated, and state government should have a part in only the following: Electricity/roads, and policing.

    2. Towards what is always the question.

    3. Yep, we can be sure the connected political class will have all the booze they want.

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  2. “there’s a massive Total Wine within spitting distance of the Pennsylvania-Delaware border in the Philadelphia suburbs”

    Kudos to the free market there, and it’s about the distance Senile Joe traveled from Wilmington during the entire 2020 election campaign. When he wasn’t sniffing hair.

    1. Sniffing hair of the dog.

      1. Kamala is a bitch, yes.

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    3. No DE sales tax also a thing.

      1. Maybe they will start putting up check points at the border to search for DE liquor purchases. Around 25 years ago they did that in WA for cigarettes because the taxes in ID are so much lower. The WA State Patrol would have an undercover unit at the store on the ID side sending vehicle info to cruisers on the WA side of the border telling them who to pull over.

        Basically, the bluer WA gets, the more this bullshit tends to happen.

  3. Well, Governor Wolf, the exceptional idiot, did cite as the reason for vetoing the idea when it almost made headway in the commonwealth was that privatization would bring higher prices for consumers. So, here we are, no higher prices, just no product. Breadlines are always preferable to a certain class of politician.

    1. Power is especially fun when you can lord it over the masses. The Democratic Party way.

      1. It’s hard to feel like you’re in a better caste than the great unwashed if they are allowed the same luxuries and finery as the political caste.

    2. Depends on if you define no availability as zero price or infinite price.

    3. Wolf has his head so far up the asses of the Unions, he tastes their food before they do. That’s all he is about. Supporting the unions that support him.

    4. Higher prices also leads to higher supply. But don’t try to explain that to a statist. Or a crony
      capitalist.

  4. Nobody needs 27 kinds of liquor.

    1. The government employees in the state stores love it when they only need to sell unpopular brands. Much easier day.

      1. When WA privatized liquor sales they jacked liquor taxes up by about 30% even though the state’s overhead largely disappeared.

    2. Tell that to someone who is running a bar -_-
      So are you happy so long as there is some food, and have no preference over which food is there?

      Guess it’s a tub of crisco and saltines for dinner, but who needs more than 2 types of food?

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    3. You didn’t distill that!

    4. 23, Sir.

    5. That’s the most ill informed statement ever.
      It’s not about wanting 27 different kinds but the choice between 27 different kinds.
      Free markets

  5. Some places are over-ordering bottles, which leaves us with none to purchase,”
    Wreckers.

  6. No chance at all that the ‘supply chain disruptions’ were caused by, and are aggravated by, the various emergency rules that claim the Communist Chinese Virus as their justification?

    1. That, and everyone is dead

    2. Next phase of shop local planning.

    3. Rules issued by Communist Yankee Democrats.

  7. What I especially like about prices is that you don’t need to inquire into the reason prices rise. If the price of oranges doubles, but not apples, it doesn’t matter whether it’s because of a freeze in Florida, because the oranges come from farther away and gas prices went up, because Minute Maid suddenly decided to put more concentrate in each can of frozen juice, or some mucky muck burrocrat decided oranges need a higher carbon tax (Orange Man bad!).

    I put prices and currency as the most important invention ever. They did more to improve markets than any central planner could dream of.

    1. Not to mention the ability for them to compare drastically different items. Do I want to spend more on oranges, or go to a concert, or save up for a sports car.

      And the freedom that comes from being able to choose your employer. You are not beholden to any specific person or group, but free to choose any of people who want the skills you have.

  8. I was born in Pennsylvania and only return to see family. Who all wished they had moved out too. Blue states are good places to be away from.

    1. You can’t even buy a case of Beer in Pennsylvania. Too much alcohol, something, something… On the bright side, Yeungling Beer!

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  10. I’ve never been in a state run liquor store that had anything I wanted to drink. Shit selection.

  11. NH doesn’t have these problems. There’s always a better way to run a bureaucracy. NH’s only real issue is lack of distribution nodes due to the centralization. Price and availability and ability to generate profit? Not a problem.

    Standard libertarian caveat…I’d prefer a free unregulated market. But NH runs a good liquor model.

    1. That’s always possible that they do a good job. Private businesses can also suck, but they don’t survive.

  12. “Indeed, the governor who created the agency in the wake of Prohibition once claimed its mission was to make it “as inconvenient and expensive as possible” to buy liquor. Mission accomplished, I guess?”

    Yes, that was one aim of regulating liquor in the wake of prohibition – yes, I suppose you can have it, but that doesn’t mean it has to be easy!

  13. From the link:

    “When Prohibition was shoveled into the ashbin of history in 1933, Pennsylvania Gov. Gifford Pinchot was not a fan. An outspoken teetotaler and progressive Republican who thought liquor contributed to political corruption, Pinchot believed that “Prohibition at its worst has been better than booze at its best,” and he wasn’t afraid to keep imposing his beliefs on the people of Pennsylvania.

    “There wasn’t political support for a continued state-level ban on alcohol after the passage of the 21st Amendment, so Pinchot negotiated what he saw as the next best thing: a state-run liquor system that would be both wholesaler and distributor. During a special session of the state legislature called by the governor after it became obvious Prohibition’s days were numbered, he convinced lawmakers to approve a state liquor system that would discourage the purchase of alcoholic beverages “by making it as inconvenient and expensive as possible.””

    I think I heard about him in school based on him being a conservationist who tried to protect Bambi and Thumper from evil tophatted developers allied with the Taft administration – thus sparking the split between Taft and Teddy Roosevelt and paving the way for Woody Wilson.

    How unsurprising that he should be an all-round reformer, not just a conservationist.

  14. This is a dumb example.

    There is a shortage. Higher retail prices don’t change that. They just change which bars get the bottles.

    If the suppliers raise their prices then so will PA, according to their bureaucratic process.

    What this article is really suggesting is that the state capture some short term profits by selling the bottles to different bars.

    And that’s just not very important.

    1. Higher prices attract more supply.

    2. Why shouldn’t the taxpayers (the “state”) benefit from higher market prices instead of having Lucky Bar No. 3 benefit from taxpayer-subsidized low prices?

  15. The residents of Pennsylvania, lacking a free market for alcohol, are being bamboozeled.

    1. Whoever dreamed up alcohol rationing needs to be in a drunk tank.

      1. Or decomposing in a nearby landfill.

        1. Have you ever considered that you might have antisocial tendencies?

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  17. Funny…here ins California, our CostCo has a full liquor and wine section.

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  19. Stay away from any state with “Commonwealth” in front of its name…

    1. How about “Nietzschean” or “Magog?”

    2. I’m partial to the “Dens of,” at least for vacationing.

  20. As a transplant from NC it’s pretty funny that the article notes NC had the same problem. Actually they didn’t, because unlike PA, residents of NC are free to purchase alcohol online from anywhere they please and can thus avoid dealing with the state’s supposed supply issues.

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  21. You gotta love ignorant commies

  22. Why on earth would anyone care about “price gouging” in the liquor market, of all things? It’s like the perfect example of something you would want to discourage consumption of, if you cared at all. I mean, they call them “sin taxes” for a reason. Is there some concern that poor people people might not be able to get immediate access to bourbon if prices go up to the point where only rich people think it’s worthwhile to buy?

    1. Only authoritarians want government to discourage/manipulate consumption of products.

      Either you believe people ought to be free or you don’t. Pick one.

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  24. I can think of a dozen ways that the simplistic libertarian (and, amazingly, orthodox) economic models go haywire in this product category alone.

    Everyone knows the booze industry depends on alcohol addicts. Like 90% of the business. Addiction is by definition the absence of rational market choice, and that entails all sorts of policy implications, deliberate or otherwise (a price hike is a tax on alcohol addicts).

    Or maybe you want to ensure your three-martini lunches are protected as sacrosanct, again, a policy choice.

    The choice to sit with your thumb in your asshole as you watch the market evolve is an expression of some exasperating nerd culture, not a policy portfolio. Supply and demand determine prices. That’s an observation about an ideal system. What does it have to do with any normative goals?

    Grown-up economics surprise even grownups economists every day by how the real world doesn’t work anything like “rational market actor” models suggest, not least because there is no such creature as a rational market actor.

    1. The fact that people make choices that you would rather they didn’t is what freedom is all about.

      And bad choices having their own negative consequences is the most rational thing in the world.

      1. You’re again describing an ideal system that has nothing to do with real humans in the real world.

        Very few of the choices you make have only consequences for you alone. Once you set foot outside your masturbatorium, you start breathing the same air as other people, and sometimes that air contains viruses. You use the roads other people use, so you have to restrict your freedom there. You’re not even to your kitchen sink before you start making choices that affect other people.

        So I don’t know what you’re even talking about. Also, people making choices has very little to do with freedom. People’s brains make choices for them with no conscious action, most or all of the time. The choices you think you’re making are mostly or always after-the-fact rationalizations.

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  27. My brother handles all the liquor ordering for the store he works for. It’s a little convenience store but they sell a lot of beer, wine and liquor.
    Right now, because of the lock downs which resulted in supply chains to be affected, certain brands of liquor have become difficult to obtain and some not at all.
    Michigan, thankfully does not, as of yet, have any such restriction on purchases. I give Witchmer another week or two……

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