Monday, July 29, 2013

I am sick and tired of the characterization of privatization supporters as "lazy drunks"

I've been reading the letters to the editors from people who think the world will end if liquor sales are privatized, or if beer is sold at gas stations, or if beer and wine are sold in the same place. What's worse, I've been reading the comments people leave on the web versions of those letters and stories. I shouldn't, I know, because they just drive me crazy...and here's why. 

I am sick and tired of hearing people who are just asking for the same kind of convenience they see in other states being called "lazy," or "alcoholics." We're "lazy" because we'd rather make one stop to buy our groceries...which in most other states includes the beer and wine? Am I supposed to believe that the people who call us lazy never stop at a convenience store for a bag of ice or a cold drink, instead of going to the grocery store? Man, that's lazy! Are we "alcoholics" because we'd like to buy our booze on a Sunday, or at the grocery store/drugstore/gas normal people do in other states? Are they all alcoholics? I don't think so.

We aren't lazy, we aren't alcoholics, though it's easier to try to smear us like that rather than address what we're really saying. This is what we want:
  • We want rid of Pennsylvania's antiquated alcohol laws.
  • Get rid of the case law. ANY restrictions on how little or how much beer a person can buy in a single purchase should go. 
  • End the State Stores, AND the state's monopoly on wholesale wine and liquor, which limits what wine and spirits we're "allowed" to buy to those selected by a committee in Harrisburg, without any input from the customers: us!
  • We'd like to see an end to the strange limits on what beer distributors can and cannot sell: it's okay to sell soda, tobacco, snacks, and beer paraphernalia (like glassware), but they can't sell sandwiches, or more substantial food, or much else of anything, really. Why not? 
  • We'd like to see an end to the bizarre requirement that a supermarket must have a cafe in order to sell beer
  • We'd like to see the state have a normal number of retail wine outlets; that would be about 6,000, comparing our population and geographic size to those of other states. 
  • We'd like to have a choice in where we buy our booze, not just one store that's the same store all across the state.
  • We'd like to see an end to the police-enforced monopoly, and be able to buy wine and liquor in other states if we want to. For many of us in southeast PA, there are lots of great stores not far away, but buying there and bringing it home is illegal...which is insultingly unAmerican. 
We're not lazy; we're disgusted. We're not alcoholics; alcoholics don't care about inconvenience, they just do whatever's needed to get their drink. We don't want "alcohol," we want better selections of wines and spirits, we want a real choice on where to get them, and we want better service where we shop. We just want things to be normal in Pennsylvania.

And what we really for the Legislature to take this up and get it done in September. Finish it.

Monday, July 15, 2013

"I am a producer of fine wine..."

I just got this comment on another story I posted today, and I thought it deserved fuller treatment, so I'm putting it up as a post. Unfortunately -- but understandably -- it was an anonymous post, but I've heard similar stories from other importers and producers. They've all warned me that they must remain anonymous, because the bureaucrats at the PLCB are vindictive. I know this from personal experience; I've seen them retaliate against producers who have talked to me. name, even though that diminishes somewhat the poster's credibility.

Their credibility is, however, enhanced by their clear passion about this issue. This is a point we've tried to make a number of times: this is NOT about killing union jobs, this is NOT about making it easier to get cheap buzzbooze, this is NOT about beer in supermarkets. What this is choice, and how the PLCB denies it to Pennsylvanians. At least, to those of us who don't live close to the border. Many of us simply cross that border and take privatization, since the Legislature won't see fit to give it to us.

The winemaker has the floor.

I am a producer of fine wine. I sell wine in 35 states. We sometimes are able to sell wine in PA, but there is no other state I work in that operates like PA. We have to get through the PLCB, regardless of whether or not our wine is wanted by citizens. Unlike every other state I work with, PA has an organization that can limit access to our wine because they don't want to buy it, don't like the price I have assigned to it, or for whatever reason, they simply don't want to work with me.

I don't think that most Pennsylvanians realize how their access to fine wine is severely limited by the PLCB. Even when I know for a fact that I could be selling wine in PA, because people have contacted me and specifically said so, I am sometimes unable to do so because the PLCB refuses to purchase. The PLCB arrangement in PA consolidates power in the hands of one org, and many times in the hands of ONE individual. If I have a good relationship with this individual, I'm able to sell wine just fine in PA. If for some reason this individual doesn't like something I've done, like raise prices, then he/she can simply not buy. And he/she (the PLCB representative) is my ONLY option for selling wine into PA at the retail level. (There are exceptions for restaurants, but it is nominal, and honestly, a huge hassle.)

In most states, if a distributor is willing to take you on, that distributor then purchases your product and goes out into the market and sells it. Maybe it sells. Maybe it doesn't. That responsibility falls on the distributor and me. And if that distributor decides to decline to purchase your product or starts to perform poorly, then you have other distributors to choose from.

In PA, you can't even sell your wine to people who want it, unless you schmooze with the PLCB and give them their cut. So, in effect, PA citizens get taxed twice by their state government. I can think of no other example other than a mafia that works like this.

And the only producers of wine that are okay with an arrangement like this are massive producers of wine like Gallo and Constellation, who make millions and millions of cases of wine and grease the skids with the PLCB and lobby the state government and have so much low end wine that people want that the PLCB can't really say no to them. In the eyes of these massive producers, leaving the choice up to one individual who simply can't say no to them is a huge victory. They love an arrangement like this. It keeps producers like me out of the market and all it is is competition between their own brands. False competition, given that all the wines are ultimately made by the same company.

Lastly, the idea that a bunch of jobs would be lost or a bunch of deaths would all of a sudden occur is simply preposterous. If that was the case, the rest of America would be mayhem, as PA is one of the few states that inserts the state government into the selling of wine to this degree. And other states are not mayhem. They operate just fine, and there are plenty of jobs. The real difference between PA and most other states is that in most other states you have a much better and broader selection of wines to choose from when you go to a wine shop.

UFCW member admits privatization WILL make buying wine cheaper and more convenient!

John Rzodkiewicz, long-time PLCB clerk and now an employee of the UFCW (the main union for State Store clerks), made a surprising admission on a PennLive page yesterday, showing that he realizes that privatization will indeed make it more convenient to buy wine and spirits in Pennsylvania, and at lower prices. Here's how it happened.

PennLive published a letter from David L. Faust, of Selinsgrove, who said there were "six questions to ponder" about privatization. They're, well, you should probably go read them, because they range from Prohibitionist to pro-beer distributor to socialist to...internally contradictory, so much so that they're kind of funny.

Then down in the comments, 'fancysmom' asked "Will a change in how alcohol is sold in PA make a difference to alcoholics? NO", to which 'Chuck' responded, "Just less future alcoholics. Or maybe you should ask Alberta Brooks or maybe even Lewser Bryson. They seem to be the expert lackeys of Corbett, Cawley, TurDzai, Adolph, Taylor, etc...." (Chuck's quite a wit, as you can see; ho ho, haven't heard "Lewser" since high school, Chuckie.) 'fancysmom' responds, asking, "Please explain how maintaining state stores will result in fewer future alcoholics. A statement that definitive should have some support."

That's when 'JohnRz' responds with this amazingly candid observation: "Alcohol is a drug. Ask any cop if you have a bigger crack problem when crack becomes cheaper and more available."

Excellent! Sure, John makes a ridiculous equivalency between a bottle of chardonnay and a pipe full of crack cocaine, but that's the kind of neo-Prohibitionist cant we've come to expect from the PLCB and their ilk. The point is, John's owning up to the simple fact that wine and spirits will be cheaper and easier to buy if the State Stores are replace by private stores. We've known that all along, but this slip of the fingers shows that the pro-PLCB partisans know it too, and they're fighting against it to keep the status quo, and keep the crappy State Stores as the only choice for Pennsylvanians. 

Thanks, John Rzodkiewicz! Your honesty is appreciated! (Not sure how Wendell W. Young IV is going to feel about it...)

Don't Forget: it's not just the State Stores and the Case Law

I don't want to lose focus on privatization, because we've all got to keep letting our representatives and senators know over the summer that we want them to use the September legislative session to get this done: no linkage to the Transportation bill, no linkage to Corbett, just "linkage" to what their constituents have wanted for 40 years... We hear about "package reform," which is Legislaturese for "fixing the case law," but their idea of "package reform" is just another set of stupidly arbitrary limits on how much we can buy and where we can buy it. It's really simple: no limits on how much or how little beer we can buy in one transaction at one store. Fix it.

But there are other problems. I was reminded of one of them while I was reading this Washington Post article on how the beer scene is growing in Washington, DC. Washington beer bars have -- have always had -- a regulatory edge on their competition in Maryland and Virginia: no registration laws, no wholesaler exclusivity laws. The reporter explains how that works by comparing the two situations:
Suppose a Maryland or Virginia beer bar wants to sell a hot new release. The beer bars have to make sure it’s approved for sale in the state, call a distributor to see if it’s available in the warehouse, then arrange delivery to the bar. (This is what’s known as the three-tier system.) If a D.C. beer bar wants to bring in the same beer, it just calls the brewery or the local beer rep, orders the beer, has it delivered and pays D.C. sales tax on the purchase price of kegs or bottles. Any beer, from anywhere, can be sold here.
The article goes on to point out that enterprising retailers have driven hundreds of miles to purchase rare beers and bring them back. And...what would be so horrible about that? Well, for one thing, the Pennsylvania beer excise tax would have to be paid. It's not much, one of the lowest in the country (which means one of the lowest in the world, hallelujah), but it does have to be paid. Luckily, it's based on something very simple: volume, which means a standard table could be whipped up pretty quickly for 24-bottle 12 oz. cases, sixtel kegs, 12-bottle 22 oz. cases, and so on.

The major difference for the State? The bar would be responsible for paying that tax rather than a wholesaler, and would, presumably, be responsible for keeping a paper trail. Still...most bars would continue to buy the same old stuff from the same old wholesalers; that's where wholesalers in other retail markets make their money, off convenience and service, rather than laws that force retailers to buy from them at whatever price the wholesaler happens to set (or is allowed to set; some states have maximum markup laws).

Getting rid of beer registration would be ridiculously simple. It was obvious during the Beer Registration Raids Hearings that no one could give a straight answer on why beer registration even existed. It's likely that the reason it does is closely linked to wholesaler exclusivity; beer registration involves the brand, the producer/importer...and what wholesalers have the rights to sell that beer in the state.

So the two are linked. Well...maybe it's time to take a serious look at this anti-competitive combine of laws, and determine whether it's really serving the Commonwealth and its citizens, or if it's only serving a small number of businesses at the expense of the Commonwealth's beer drinkers.

Thursday, July 11, 2013

Why the PLCB's "Modernization" plan is misleading

The PLCB keeps telling us that they want to "modernize" their stores; the unions involved (the UFCW and ISSU) tell us the same thing; the Democratic legislators who dance merrily (in lockstep) to their tune put forth "modernization" proposals. But take a look at what they tell you, and wonder...if this stuff is so great...why aren't they already doing it?

What do we want? More convenience.
The PLCB Partisans offer this:

We can open more stores.
The PLCB already controls how many stores are open. There were 692 in 2000, there are 596 now. Neither the house or the senate had to vote to change that. They can open more stores any time they want to. They haven't, they've closed stores. Why? Probably because of their bulging overhead costs and mismanagement.

We can make shopping more convenient by putting more "stores in stores," State Stores in or beside grocery stores and beer distributors.
Not one of the new Fine Wine and Good Spirits Stores are "in a store" and none being built at this moment are either. Once again: if they can do it...why aren't they doing it now?

We can increase the hours.
Except for Sunday sales, which would require an act of the Legislature, the PLCB can set the hours for all stores now. If they wanted to be open 8AM-11PM, they could be. They obviously don't.

What does the Legislature want from the PLCB? More MONEY.
The PLCB Partisans offer this:

We can and have reduced costs to make more money for the state.
In the free market, reduced costs mean lower prices for the consumer; see Walmart as an example. I haven't seen it at the State Stores, have you? You come last at the PLCB.

We will turn in a record amount of money to the general fund this year.
It's juggling. Next year, when they bring inventory back up to normal, hire the 400 people that they purposely didn't hire this year to make the numbers look good and pay for new stores at a faster rate than the current 100 year completion schedule, it will go back down to historical percentages or lower. But by then the privatization scare will be over, so they don't care about next year.

What do we really want? A chance to buy in great stores like they have in other states: a choice.
The PLCB Partisans tell us: The PLCB is "a world-class shopping experience...akin to Williams-Sonoma."
 You don't become "world class" simply by saying you are "world class." You do it by working hard, exceeding expectations in selection, customer service, and meeting customers needs and wants...and then being judged "world class" by independent experts in your field. Even the ISSU, the Independent State Store Union, which represents the stores' managers, calls it "their delusional effort as a wannabe 'world class retailer'".(ISSU press release, Dec. 9, 2011)

As we saw with the wine kiosks, the PLCB knows nothing about "modernization." In fact, expecting an agency that came up with such a clunky idea as the wine kiosks to offer sound ideas on "modernization" is like asking your dog for advice on how to fix your car.

Remember, folks: Privatization IS Modernization. We don't need to "modernize" the PLCB; we need to put it out to pasture where it belongs.

Thanks to Albert Brooks for the core ideas of this post.

Tuesday, July 9, 2013

Just to remind you what the Senate is protecting you from...

Thanks to the gutless chumps in the state Senate who couldn't pass a privatization bill (because it would interfere with their campaign cash nom-noms), we don't have to worry about this happening in Pennsylvania!

"Total Wine and More is set to open its sixth Washington state location in Olympia on July 18. The 21,000-square-foot space will stock more than 8,000 wines, 3,000 spirits and 2,500 beers, including 1,500 Washington wines, 80 spirits distilled in Washington or Oregon and 550 beers from the Pacific Northwest region. The outpost will also feature a “Brewery District” beer-tasting bar and growler station, offering 12 rotating taps of local craft brews. Total Wine and More’s seventh Washington store is slated to open in Spokane later this year."

Just imagine if we had passed a similar privatization law in Pennsylvania (without the stupidly greedy tax increase Washingtonians got stuck with, of course). We'd be faced with greater choices, lower prices, more jobs, and diminished border bleed within a year. Thank God the Senate is a spineless special-interest pool that can't bring itself to be a body that reflects the will of the people!

Monday, July 1, 2013

On Hold

So, before the "PLCB is the bestest we won!!!!" crowd starts to wonder where I am... I'm really busy. I know, my anonymous "friends" have been telling me I'm obsessed about this, but the truth is, I spent the weekend with my family, celebrated a birthday, and went to the Jazz Festival in Rochester, NY (Trombone Shorty, GREAT show). And I'm in deadline mode on a whiskey book AND wrapping up an issue of Whisky Advocate. Got a lot on my plate.

To be brief, then: we ran out of time, for which I say, WELL DONE, SENATOR CHUCK MCILHINNEY, your plan worked! Your hearings really wasted time, and made it impossible to get a liquor privatization bill passed before the June 30 deadline. So you're down as having tried, but you're not on the hook with your beer and union donors for having actually passed a bill. Be careful that fence doesn't split you right in half, now. And Senator Tomlinson? One word for you, fella: primary.

And it's not over. Things don't usually get done in the Fall session, but there IS a Fall session, and that Transportation bill needs to be passed. Let's push on this. Liquor privatization has never come this far before; don't let it fall on the floor.