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If you live in Oregon, for now, you can't just walk down the street to the corner grocery store every time you run out of tequila. Of course, if you live in Oregon, you might not do that anyway, since, if Portlandia is to be believed, you probably just ride your fixed-gear bike around to locally-sourced mixology enclaves within a couple mile radius of your community art loft.
Anyhow, let me explain.
Oregon is one of 17 states where liquor sales are entirely in the purview of state government. The state buys the alcohol in bulk, stores it in government-owned warehouses, and then sells the alcohol to Oregon residents through a number of privately-owned state liquor stores. But with growing demand for easy-to-obtain booze, some legislators in Oregon are considering opening up the process, privatizing liquor sales (or at least, making them more private than they are now) and making liquor widely available at more convenient locations for Oregon residents.
"We're getting very serious about doing something for 2014," said Joe Gilliam, who represents the Northwest Grocery Association. A decision on whether to go forward could come by the end of August, Gilliam said.
A key lawmaker said he would hold hearings during the Legislature's off season to look into "modernizing" the way the state deals with liquor, but wants the state to maintain control. "I'm in search of a middle ground," said Sen. Lee Beyer, D-Springfield, chairman of the Senate Business and Transportation Committee.
There are a few problems with privatizing liquor from the state's perspective. Booze sales generate huge revenues for local governments because, while state-sold liquor might be slightly cheaper than liquor sold over the Washington border in privately-owned grocery and convenience stores, whatever profit is made off liquor sales goes straight into the state's and cities' coffers. This revenue funds lots of government programs to the tune of millions of dollars per year. And while Oregon's taste in liquor has grown (and now encompasses more expensive brands, including lots of "craft" and "local" beer options), the state has made more revenue last year than ever before.
To be fair, the state made this money because it doesn't allow anyone else to make money. Washington state, though, which privatized liquor last year, saw an increase in tax revenue after they privatized as small businesses were making more money selling liquor, reaping greater profits, and paying more in taxes. When states control prices and availability, it may be a great deal for liquor buyers (because states can set prices below average prices at private stores), but it's a terrible deal for potential liquor sellers. Grocery stores, convenience stores and restaurants, where bottles of alcohol could be sold, lose out on profits and consumers lose out on choice. Whatever the state buys is whatever the public can purchase. In some ways, this has helped Oregon's local "boutique" distillers, beer crafters and wine-makers, but it's prevented brands that exist outside Oregon's borders for effectively competing for Oregon consumers. And who is to say that Oregon's local distillers are any better than Kentucky's? Or Mexico's? And who is to say that encouraging competition would necessarily increase prices in Oregon? By allowing wholesale stores like CostCo to sell beer, wine and spirits, consumers may actually find their liquor budgets will shrink.
Oregon's legislators also point to their own control of state liquor consumption, under the nanny-state notion that when the government controls the availability of a vice, somehow people will magically consume less. We know, with cigarette taxes and bans on giant sodas, this simply isn't true because for all of humanity's flaws, it isn't dumb when it comes to doing things people tell humanity not to do. We seek out better prices, black markets and ways around nanny state laws. And when it comes to privately-sold liquor, we don't actually consume more liquor when more is readily available. And more importantly, we don't act with reckless abandon: even though Washington state legislators predicted that an explosion in liquor stores would doom citizens to legions of boozy drivers and drunken neighbors. Incidents of drunken driving -and DUI arrests -actually declined.
It turns out that when you get the government out of a business it didn't necessarily belong in originally, people don't perish en masse. But most of us knew that already.