Thursday, February 5, 2015

Wanna Talk Washington? Fine, Let's Talk Washington

The latest claim by some union members and supporters is that Washington state is making less money this year than when they had a state run system, and the implication is that it's because they privatized. The truth is that they are about $46 million ahead of the last year of state-run stores.  Even though I explained and pointed out where to find all the numbers in "Why Johnny can't read or do math Part 3", they seem to still have difficulty with addition.

One more time, then: the Washington State Department of Revenue collects liquor taxes. The total for Fiscal Year 2014 was $267,374,563. The Washington State Liquor Control Board collects spirit fees, license fees and beer and wine taxes. That was $227,320,000 for Fiscal year 2014. That means the total state booze-related revenue collected in FY 2014 was $494,7 million. In the last year of state-run liquor stores (FY2012), the total returned was $448.7 million (including store "profit") which also included the one-time $31 million income from the sale of the old state stores and was still $46 million less than this year.

Now, here's the crucial part that brings all the crowing about the State Store System's "record sales" into perspective. Compare what the PLCB, with control of both wine and liquor and twice the population and over twice the total sales of Washington State, did over that same period. They didn't even come close to  increasing the contribution to the state by that amount. Their increase was only $33 million, and yes, that includes the so-called "profit" and taxes, too. Washington does not charge regular state sales taxes on liquor, but includes a Spirit Sales Tax in the price, the same way PA includes the Johnstown Flood Tax in the retail price. I did include PA sales tax in the above comparison; it's revenue from booze sales. But still...they couldn't match the increase Washington saw when it privatized (and remember; Washington only privatized liquor!).

Freedom of choice, free enterprise, free interstate commerce...those are things the country was founded on, and these are the things denied the citizens of Pennsylvania by the State Store System. Washington State now has greater selection, more convenience, more taxes collected, and lower DUI fatalities. Looks to me like Washington is winning. We can be winners too. Privatize.

Privatization Is Modernization.


Anonymous said...

What do you think of the renewed call for a ban on all alcohol advertising in the US? The advertising ban on cigs did put a dent in teen smoking, which has greatly reduced the number of adult addicts over the years. Would this work with alcohol, or do you think it's grip on our society is too strong?

Lew Bryson said...

Well, first off, that's got nothing to do with this post. That's what comments are for, to talk about the post in question.
Second, bans on alcohol advertising don't appear to do much. Here's a summation of the arguments that appeared recently in the Philly Inquirer, written by an academic from UTex Austin:
He essentially points out that alcohol consumption has remained constant despite advertising (I'd also point out that youth consumption is at historically low levels in the U.S.; did that come from the ban on cigarette ads also?), indicating that advertising doesn't do much as far as increasing consumption, but rather influences brand selection. After all, car ads might lead you to buy a faster car, a bigger car, a more expensive car...but they don't usually lead you to buy TWO cars.
So thirdly, I'd say your concluding question is an attempt to force a bad answer. I reject your question, and simply say that advertising has been shown to have little effect on consumption of alcohol.

Albert Brooks said...

Renewed call? They must be using their inside voice because there really isn't much call here in the states. There has been some rumblings in the UK and NZ but except for the LA ban on most city property (except sports, concerts and restaurants....and those with existing contracts - is that a tough law or what?) not much else is happening that I am aware of.

The PLCB certainly isn't leading the way since they spend more on advertizing then on education.

Now that you have that out of your system do you have any questions about the subject at hand?

Lew Bryson said...

More posting about alcohol advertising is not going to be approved. Way off topic. Like I always say: if you want to start your own blog, Blogger is free, have at it. I didn't build traffic here for you to hijack posts and spread your message.
We're done here. Back to talking about Washington State's privatization of liquor sales.

Geno Washington said...

According to Wikipedia, WA has a 10,000 square foot minimum for stores selling spirits (which doesn't necessarily mean liquor stores). Most of the "big" PLCB stores are in the 10,000-12,000 square foot range, and I hope eventually those stores will be "small" by PLCB standards. Ideally we'll get privatization sometime in this century, but until then, we at least can hope the state stores continue to grow in size.

It isn't too unrealistic: Jo-Ann Fabrics stores were once almost all 10,000-12,000 square feet, but most are now at least twice that. Acme Markets have gone through a similar transformation (and a VERY remarkable one considering that in 1945, most of their stores had counter service, not unlike the PLCB did at the time).

Lew Bryson said...

Geno? (Whatever your name is) Could we just be honest here; I don't think you're really in favor of privatization at all. All your posts talk about how the PLCB's doing this, and their number of stores makes know what?

No. The PLCB's changing their stores and expanding their online selection for ONE REASON: because of the threat of privatization. If that goes do any improvements. It's no coincidence that the first major improvements in YEARS at the PLCB came since 2008, when legislators started talking seriously about privatization for the first time since the early 1990s. And if something happens that talk of privatization goes will all the improvements, and any move toward change. I guarantee that 100%.

So let's just be honest. Can we do that? You're not really in favor of privatization. You're one of those "modernization" guys, and that just ain't the same thing. We want privatization, and we want it NOW. Are you for that? Or not?

Albert Brooks said...

OK folks, this is how it is going to work. If you have a comment that pertains to the subject then post here. If you wander off about Jo-Ann Fabric or Advertising or anything else that vaguely falls under PLCB privatization but not the subject at hand post on the FB page.

It is not that difficult to grasp so I'm sure you can handle it.

Geno Washington said...

I am for privatization, NOT modernization. What other state in this country (except for Utah perhaps) only has one store every THREE MILES to buy any kind of wine or spirits? And even then flip a coin and it's a tiny store? In rural areas that kind of arrangement might make sense, but southeastern PA is stuck with it... ugh!

Lew Bryson said...

Well, okay. You just sound like a PLCB apologist sometimes. Sorry!

Anonymous said...

The infiltrators are everywhere paranoia is easily relieved when you take into account how very few read this. Relax.

Lew Bryson said...

Always a chuckle when people take the time to read your blog, and the comments, and then tell you no one reads the blog.
"Nobody goes there anymore. It's too crowded." - Yogi Berra

Anonymous said...

Washington's Office of Financial Management says there was $387 million collected from liquor sales in fiscal 2014, which ended June 2014, compared to $447 million in fiscal 2012.

Then there is that pesky 15% average retail price increase. And they DO have a big problem with shoplifting among minors. And Oregon border stores sales ARE up 30% since 2012.

And Washington's retiring liquor board chairman DID say privatizing was the "dumbest thing they ever did."

This is why nobody believes you. Everyone can check these facts.

Lew Bryson said...

First, links, or it didn't happen. Albert provides links to his data (as noted, it's in another post: ), you don't. Show it.

Second, the retail price increase is largely due to new fees imposed with privatization (as was widely reported); there MAY have been a big problem with shoplifting (there's no actual evidence, as liquor thefts are not reported separately, just anecdotes, and as scientists say, "The plural of 'anecdote' is not 'data.'" On top of that, recent 'anecdotes' indicate that the problem, if it existed, has largely been solved), and if Oregon liquor store sales are up, well, that's hardly a surprise, since Washington's liquor taxes are, post-privatization, BY FAR the highest in the country, and as such represent a government subsidy for smuggling. Kinda like PA's costs and crap retail monopoly drive people over the borders (in MUCH larger numbers than in Washington, so things must really suck here).

As for the statement of the retiring board chairman...well, it may be a "fact" that he said that, but it's only his opinion; it's not a fact.

Meanwhile, let's have a look at something Washington State's Office of Financial Management actually DID say, and is a fact, a whole series of facts:
"Sales of liquor have
increased by approximately 13 percent; revenue collections have increased by approximately 18
percent; the number of liquor stores has increased by approximately 327 percent; and one proxy
for liquor store employment (employment in NAICS 445310) has increased by approximately 91
Some of this growth might have happened without privatization of liquor sales." (emphasis added, because, well, it might NOT have happened, too) That's from "Washington State
The Impact of Initiative 1183", a January 2015 report from OFM, and you can find it here:

Your ball.

Albert Brooks said...

Yes, everybody can check.Start here with the tax numbers from the Department of Revenue: and click on the Summery 2014 tab. Add the two columns of "Total Taxes Paid"

Go to the Washington State Liquor Control Board Annual report for 2014 which you can find here:

Turn to page 17 add the line that says "Total Liquor Related Income" to the number you got from Total Taxes Paid and you will have the total of collected liquor income. I know that addition is not your strong point but somebody should be able to do it for you.

Using the Washington's Office of Financial Management report on I-1183 ( Does not show a 15% price increase (page 7) and does not show a decrease in revenue collected (numerous pages throughout the report)

Border bleed has increased, and using the numbers reported by Oregon and Idaho it is now about 15% of the bleed reported by the PLCB 2011 report.

This is why everyone thinks you are a shill because you never check your "facts"

Oh, don't forget to mention the increase in employment in Washington (it is in the OFM study) or the increase in ancillary employment in distribution centers (also in the OFM report)

Nice try John but you lose again.

Anonymous said...

Link for Washington's retiring liquor board chairman's comments.

Link for data on Washington's Office of Financial Management's revenue report.

For more data - just google "Washington liquor privatization", or Washington "spirits revenue."

Lew Bryson said...

Yeah? I don't contest that she said it, what? That's her opinion. You expect her to be proud of her agency's monopoly stores being so crappy that the voters referendumed them out of existence? Meaningless noise.

And the OFM numbers? Albert provides links to the agency's own site, the actual collection numbers. You give us a newspaper article with a graph.

Thanks for playing.

Anonymous said...

You are counting the same revenue numbers twice. Go with the Washington OFM’s figures.

Yep, you admit retail liquor prices are up 15%. So is border bleed into Oregon, as you say. Shoplifting is way up to. Been in the papers for the last two years.

You admit unit sales are up 13%. Pathetic increase, as the number of retail outlets is up 450%.

Harrisburg update: Turzai has been calling for sponsors for his liquor bill for a month now. Sent out a pleading email on Monday 2 February, promising release by 5:00 PM. Can’t help but think that if his ducks were in a row, they’d be quacking.

Senate has a contingent of moderate Republicans determined to work with Governor Wolf, who campaigned and decisively won on modernizing PLCB’s retail operations. Nobody really cared about that during the campaign, but he made his position clear.

John is in Harrisburg today, at a conference, rubbing elbows with the great and near-great. And you two – are not.

Lew Bryson said...

You don't get the revenue figures. Saying stupid twice doesn't make it smart.

Prices are up because of imposed fees. I'm not "admitting" 15%, you've pulled that number out of the air. Already addressed border bleed, AND the alleged shoplifting. You're just repeating yourself, and this is the last time you'll get to do that.

Funny you find an increase of 13% pathetic given the huge increase in number of stores, since one of the major arguments for "control" is to limit number of outlets, since otherwise consumption would go up. Looks like that's false; thanks.

As for Harrisburg...wait a bit. Things are just getting started. And the Senate is much less "moderate" in its Republicanism than the last one: everyone knows that.

Of course John's in Harrisburg; that's his job. It's not mine. Lunch break's over, I'm going back to my job.

Albert Brooks said...

Easy way to solve this. What EXACTLY are we counting twice? Department of Revenue collects liquor taxes. WALCB collects fees. Show where the double counting is.

If you can't then you are just blowing smoke.

Albert Brooks said...

Jeez, I didn't even make you read just look at a picture and you still can't get it right. The OFM graph on page 7 of their report doesn't show a 15% increase in price. The graph doesn't even go up to 15%. I don't know why I would expect any rational thought from someone who can't read a graph.

Albert Brooks said...

While we wait for our number crunching friend to figure out where I double counted (which will be a really long wait since I didn't) I thought I would give him a hint and tell him to make sure to read and more importantly understand the numbers in the Seattle Times story he is basing this statements on. It is one thing to parrot without understanding but it is another to be able to come up with a logical reason why those numbers pertain.....or not. I don't expect anything since he hasn't shown himself to be very good with logic and research but I'll wait.

Albert Brooks said...

I'm guessing that 9 days should be enough time even if he had to take off his socks. You see what happens when you believe the newspaper that references the incomplete OFM numbers or actually go to the OFM itself and look at the complete numbers.

Oh well someday somebody who can read and do math (like simple addition) will come along on the opposition side and we can have a real intellectual conversation about the subject. I don't see that happening soon.