A Look Back At The Wine Kiosks

We have a guest post today. A member of our Facebook group -- Abolish the PLCB -- Rewrite the Code! -- Wende Phifer Mate, wrote a remembrance of the wine kiosks. It was so good, we decided to run it here (with permission, of course).

Great moments in PLCB history. 

Did anyone ever try to purchase wine from one these kiosks? I lamented the passing of them because they provoked more laughter than most comedians do.

Among the highlights:

• The instructions - not bad if you had an hour to kill.
• The ID checker - you had to put your drivers license into a slot, then look into a camera in order to pass on to the next test. Hard to do with a straight face.
• The breathalyzer - yes, you had to breathe into a weird tube before the machine would allow you to proceed. It did not always register that it had been breathed into until you were about to pass out from trying.
• Choosing your wine - you had to wade though the whole list of available wines on the touchscreen. There was no other way to make a selection. Needless to say, it took some people FOR...EV...ER to get through this part. 
• The delivery system - It was like those candy machines that push the item forward until it drops. Has there ever been a more stupid idea! I watched one of my bottles crash to the floor inside the machine before it got to the collection window. I read later that this was a very common occurrence.
• The bags - Plastic bottle bags were provided but three that I pulled out had slits in the bottom. Bottle goes in, bottle goes right out the bottom. (That's another sale!)

In short, they worked just as you'd expect they would, coming from the masterminds running the PLCB.


We miss them too, Wende, but like some of Joe "Da CEO" Conti's best moments, they are a gift that keeps on giving. Whenever the PLCB starts to seem reasonable, just remember: they're only one brain-fart away from another great idea like the Wine Robot Army. That's why we say:

Privatize.

Great Minds, Great Quotes...and the PLCB

Apply great wisdom to the situation of the PLCB...and you realize how badly this has all turned out.

"Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery." - Winston Churchill 

     What organization does that sound like?

“The only real mistake is the one from which we learn nothing.” - Henry Ford

“Failure isn’t fatal, but failure to change might be.” - John Wooden

“Don’t bury your failures, let them inspire you.” - Robert Kiyosaki

“It’s fine to celebrate success, but it is more important to heed the lessons of failure.” - Bill Gates

"It certainly wasn't a failure." 

- Joe Conti, about the failed wine kiosk program.

“Success is stumbling from failure to failure with no loss of enthusiasm.” - Winston Churchill

     Then the PLCB must be an immeasurable success; 

that's all they ever do!

"Failure is simply the opportunity to begin again, this time more intelligently." - Henry Ford

     "Intelligently" being the key word here. Of course, you have to have a Board that has some intelligence for this to work.

"Honesty is the fastest way to prevent a mistake from turning into a failure." - James Altucher

Graft, collusion, nepotism, lost paperwork, lying & 

destroying evidence are probably not what he's talking about.

"You have to be able to accept failure to get better." - LeBron James

Joe Conti, again: "It certainly wasn't a failure." Yeah, Joe: it was.

"Complacency breeds failure. Only the paranoid survive." - Andy Grove

Isn't that right, Charlie "40 Years At The PLCB" Mooney?

"Inability to make decisions is one of the principal reasons executives fail. Deficiency in decision-making ranks much higher than lack of specific knowledge or technical know-how as an indicator of leadership failure." - John C. Maxwell

And when you have all of the above -- plus $1.9 billion in liabilities -- 
you have the PLCB.

Tragedy in life normally comes with betrayal and compromise, and trading on your integrity and not having dignity in life. That's really where failure comes. Tom Cochrane
Read more at: https://www.brainyquote.com/topics/failure

"Failure is not a single, cataclysmic event. You don't fail overnight. Instead, failure is a few errors in judgement, repeated every day." - Jim Rohn

"If you can't admit a failure, you're not an entrepreneur. You are not a good business person. There's nothing brilliant about what you are doing." - Mark Cuban

Failure comes only when we forget our ideals and objectives and principles. Jawaharlal Nehru
Read more at: https://www.brainyquote.com/topics/failure

One more time: "It certainly wasn't a failure."

Honesty is the fastest way to prevent a mistake from turning into a failure. James Altucher
Read more at: https://www.brainyquote.com/topics/failure

There are no secrets to success. It is the result of preparation, hard work, and learning from failure. Colin Powell
Read more at: https://www.brainyquote.com/topics/failure

There are no secrets to success. It is the result of preparation, hard work, and learning from failure. Colin Powell
Read more at: https://www.brainyquote.com/quotes/colin_powell_121363?src=t_failure

There are no secrets to success. It is the result of preparation, hard work, and learning from failure. Colin Powell
Read more at: https://www.brainyquote.com/topics/failure

There are no secrets to success. It is the result of preparation, hard work, and learning from failure. Colin Powell
Read more at: https://www.brainyquote.com/topics/failure

There are no secrets to success. It is the result of preparation, hard work, and learning from failure. Colin Powell
Read more at: https://www.brainyquote.com/topics/failure

Not Quite 10 Years Ago...

It's not quite ten years since I started this blog with this post. It was on April 22, 2008, and I should probably do the 10th anniversary post next month, but...it's snowing like mad out there right now, and I'm not going to be able to go do brewery visits like I planned, so I'm doing it now. What's a month?

Ten years ago things were pretty bad; they were worse than they are today. The State Stores were not under any kind of real scrutiny, they didn't have a useful website, and there hadn't been a serious push for privatization in 20 years. Beer was sold at distributors -- by the case and keg only -- or at taverns -- only 2 sixers at a time, and at a stiff markup -- and that was it...except for the occasional weird exception. The Legislature was in a long period of inactivity on the Almighty Liquor Code. And I was losing my mind after seeing how booze was sold all over the country.

So I started this blog...and things changed. I don't take any credit for this. Much like the success of my other crusade, the Session Beer Project, I don't feel that I caused any change. I just had a very sensitive ear to the ground, and caught the rumors and mumblings before almost anyone else did. At the most, I may have suggested lines of inquiry to reporters (who picked up on the blog fairly early; as did a suspicious number of IP addresses in downtown Harrisburg), and if that worked, well, that's always been the main aim and hoped-for audience of the blog. (A big hat-tip and thanks to my co-writer, the pseudonymous Albert Brooks, who picked up the pen while I was sidelined for over two years and has done a GREAT job feeding facts to that audience.)

What happened in the past ten years? Here's the dumb stuff.

• The PLCB spent $3.6 million on public image, advertising, and store layout, paid to a California-based marketing firm. They come up with a new name for the State Stores: "Table Leaf." In a rare rush of smarts, the PLCB realized that's idiotic (though they did keep an option on it; see below), and decided to go with the basic stupid rename: Fine Wine and Good Spirits Store. Governor Rendell was furious...and the PLCB blatantly didn't care. Your money wasted: it's a monopoly (a police-enforced monopoly, as we would point out many times), there's no need for marketing.
• The aptly-named Special Liquor Order (and they call it SLO, you can't make this up) system broke down again, and again, and again...
• The PLCB so badly screwed up their new inventory system in 2011 that store managers over-ordered so much wine that they had to store almost 100,000 cases of it in tractor-trailers...un-air conditioned trailers, in the summer. Renting the trailers and hiring security guards cost about $500,000. (Numbers are from an Auditor General report.) Good job, morons!
• Around 20 State Stores closed. A bunch more were moved for arbitrary reasons without input from local communities. And of course, we revealed that ten counties in Pennsylvania have only ONE State Store. There are ten others with only two.
• The Courtesy Contract. The PLCB spent $173,820 on training State Store System clerks "how to greet someone, where to stand, and how to read a customer's cues." And the company doing the training belonged to a PLCB regional manager's spouse. Real nice. 
• We saw several ethics investigations of the PLCB (one of which struck paydirt) and several harshly worded audits. The marketing director was found guilty of fraud...back in 2015, and he still has not been sentenced. Speculation is that he is cooperating in further federal investigations. Conti must be spooked. 
• We saw again and again that the PLCB often actively made it harder for licensees and wholesalers and brewers to sell beer. You know...their only competition in the booze biz. Not bad, when you make the rules. This included the harassment of three Philly bars and a major Philly beer wholesaler for selling "unregistered" beer, carried out by the BLCE and supported by the PLCB (and their soon-to-be-exposed flawed database). After armed raids, seizures of beer, disruption of private (beer) business, and a full-blown legislative hearing...the result was a warning letter. Harassment, and they should have been sued. 
• The Saga of Joe "Da CEO" Conti, from his disappearance, to his greatest failure, to his ignominious end, to his unlikely (and lucrative) return. We miss his shenanigans; his constantly wrong-footed instincts were the best thing that ever happened to privatization. 
• The Wine Kiosks. Nothing more need be said. Possibly their biggest failure in the last 40 years, and that's saying something. 
• Table Leaf: the brand. As mentioned above, they'd already (over)paid for this branding, so they used it for a house brand of wine. And then they decided to wield it as a weapon against their biggest suppliers...and Pennsylvania wineries. Who brought it to the Legislature's attention, and that was the end of another PLCB fiasco.
• Privatization was repeatedly brought up by the House, and squashed in the Senate, mainly thanks to the efforts of Senator Chuck McIlhinney.
• But in all the past ten years, the very worst thing that happened was that the Legislature let the PLCB have the one thing that they never should have: so-called "flexible pricing." This is the idea that the PLCB should not be forced to use the same set mark-up on every item; when they got a deal, they could pass it on (which is bullshit: they could always have done that). What it really means is that they charge more; we told you that for years, and golly, it was true. We're stuck with it, too.

  

  Ah, the wine kiosk. The Best Worst Thing.

Wow. I know I'm missing stuff, but those are the big ones. Yet somehow, these ding-dongs are still in business, still the sole wholesaler of wine and spirits in the state despite continual screw-ups.

Meanwhile, we did get some things, although almost all of them were mixed blessings. 

All right, break it up!

• The case law is finally gone! That was one of the big ones. We no longer have to buy an entire case of beer at the distributor. That'd be great, except we still can only buy a 12-pack at bars and grocery stores (more on that shortly), then walk out the door and walk back in and buy another...What kind of bullshit is that?
• We can buy beer and wine in grocery stores and convenience stores!! HOT DAMN! Whoa there, hoss. We can buy beer and wine in places that hold a restaurant license; that's always been true, but now these stores can buy those licenses (for as much as $500,000!), and put in a 'cafe' that seats at least 30, and sell sixpacks. About 450-odd stores have done so, out of the thousands in the state. So don't wet yourself with glee. And remember: a 12-pack of beer, or four bottles of wine, and it's out the door you go. 
• Direct wine shipment (and beer...but not liquor) is now a thing. That's a big deal for a small number of people. 
• The PLCB had to start telling the truth about their financials; specifically, their deep pension debt. And just like that, they were no longer making money, net of taxes. They still are paying money into the General Fund, because they have to, but they're doing it out of reserve assets. The day of reckoning is coming. 
• We got some really cool stuff: Pennsylvania booze producers can cross-sell their products. A winery can sell PA-produced beer, cider, spirits, mead...and, what, kvass, I guess? Any of that. And they can have satellite stores off their main production premises, which can also sell those other products, which has led to Pennsylvania Libations, the first privately-owned liquor store in Pennsylvania in almost 100 years. And that's cool. 
• About a thousand (I think) liquor licenses were blown out of escrow and auctioned off. Mostly picked up by grocery stores. So that's kind of good, but...all those grocery stores buying bar licenses is making the price of a license go up, a lot in some places, and that's putting the squeeze on indie mom-and-pop bars and groceries. This is going to give us a lot more chain groceries and chain restaurants, and that, my friends, ain't optimal. 

That's all I can think of right now. There have been some other side effects. One, the PLCB is running scared, and the selection is about as good as it's been in a while. (You're a fool if you think that will continue if the privatization talk dies down, so let's keep 'em scared.) Two, the BLCE has been scared to do any enforcement of the monopoly, so we can buy out of state with impunity. Three, people have a lower opinion of the PLCB these days after the corruption charges, and that's good. Four, McIlhinney's retiring, and maybe we can get someone who really gets it in there.

OTOH...The GOP has, overall, been a huge friend to privatization of the PLCB in the past 40 years, despite numerous missteps. The unpopularity of the Trump administration may lead to a loss of the solid GOP majority in the General Assembly. Overall, that's how things go, but for this issue? If the Democrats gain a majority, or cut the GOP majority, you can kiss further progress good-bye. Because the Dems have made it crystal-clear that they are opposed to any further privatization of the State Store System. We'll just have to wait and see.

Overall, though? Good progress at the 10-year mark. We got rid of the case law, and the PLCB's sales are suffering from the wine sales at groceries. This is what union boss Wendell W. "Windy Wendy" Young IV referred to as "the death of a thousand cuts." Here's hoping he's right about that, and that "flexible pricing" doesn't bleed us to death in the meantime.

I feel for you folks who are far from a border. If Philly were where State College is, away from the liquor stores of Jersey and Delaware, the PLCB would have been long gone. Let's keep the pressure on.

Great New Profit-maker for the PLCB!

Great news! As reported here on Philly.com, and in more detail here from the Justice Department's own website, four companies have been ordered to pay a total of $9 million in fines for their role in the unethical practices of three PLCB officials: P.J. "PJ" Stapleton, Joe "Da CEO" Conti, and James "Fall Guy" Short. It took over four years, but they're paying, and even when you're selling booze to a monopoly that doesn't care about its customers, that ain't chump change.

We were glad to see this, since we fully support telling the truth and stating facts, even if they don't necessarily make the PLCB look bad. That's not our main mission: our main mission is proving that the current system is outdated, not good for customers, and yes, naturally prone to corruption and abuses like this. We were also glad to see that our friend (no, he doesn't know it, but he is, just like Joe "Da CEO" Conti was) James "Fall Guy" Short still hasn't been sentenced almost two years after his conviction on fraud charges. Hmmmm...wonder why that is? Bet a lot of current and former PLCB employees are wondering too.

Dat's a right: Malocchio!

Anyway, the Philly.com comments gang — usually a heap of steaming crap; angry steaming crap — managed to come up with a great idea related to this! Check this out from a genius calling themselves Malocchio: "Maybe this can be a new revenue generator for them... entrap their vendors into giving gifts, then assess confiscatory fines against them... instant profit!"

Brilliant. In fact, too smart for the PLCB. It would all fall apart shortly after the gifts were received...and the employees spent them and asked for more. Hey guys! Remember the "entrapment" part? The trap's gotta spring! Guys? Guys?

End the corruption. Privatize now. Not after more "studies," not after more "hearings," not with all the states where privatization works to look at. 

PRIVATIZE NOW. In fact, right now would be a GREAT time: swap the Democrats a fracking tax for full and immediate privatization. Get what we want, balance the budget, and chances are good no one would really even notice the frack tax. Let's do this, PA Legislature, the citizens are waiting.

New Positions, Old Positions

The PLCB says, over and over, they want to run like a business. I did a comparison of how they attempt to go about that in my "Run Like A Business - Really?" post at the beginning of this year.

One of the things businesses do, one of the most important things, is hiring personnel to do the work and run the operations. The PLCB way is not so much to hire qualified people in 99% of those occasions, as it is to prefer the policy of promoting from within. In general, though, those people know nothing about how real retail is run, because all they know is the Socialist Monopoly PLCB retail model, which has little to do being "run like a business." Governor Wolf continues the tradition of hiring hacks, people with no liquor retail experience, with his latest addition to the board.

Who runs the "business"? The Board seems to have abdicated that responsibility, reserving to itself the job of rubber-stamping license applications (and reading letters from the Governor), testifying to the Legislature about how wonderful things are (despite how they look), and hiring people to actually run the "business." People like Joe "Da CEO" Conti and John Metzger and whoever Metzger's replacement will be when he retires at the end of September.. Nice work, boys.

Now we have the new made-up position of COO (Chief Operation Officer), which you usually find in businesses with more than one thing going on. Maybe he is in charge of the liquor testing lounge too. Just another $120+K slot that didn't exist before this year, filled by another born and bred PLCB insider, the former Director of Retail Operations Charles Mooney.

Besides getting paid every two weeks, just what has Mooney done? Not much so far, that we can see. But that's not surprising, considering that he was the guy who took years to replace Renovo's store, a year to move the Mountaintop store 50 feet (give or take), and pulled the State Stores out of downtown Lewisburg and Lock Haven against the wishes of the community, the local Representative, and their state Senator. You can read some other consumer friendly (I'm kidding) things he's had his hands in here. I don't expect much to change in the new position. Charlie's replacement is another brainwashed 30 year PLCB vet, Carl Jolly, so you know there won't be any innovation happening, just like during Charlie's tenure. Same old, same old, that's the way we've always done it here at the good old State Store System.

I'm not sure how this is going to work. In a real business, all the "Chief" officers are higher up the food chain than Directors. But at the PLCB we now have a COO and have had CIO (Chief Information Officer), both ostensibly under the Executive Director, at least according to the PLCB's own wire diagram in their Fiscal Year In Review (page 9 if you are following along). Just like every business you've never seen.

It is a typical PLCB answer to a PLCB problem. Throw money (or in this case, Mooney) at it and see if that fixes it. Adding more bureaucrats to an already top-heavy, incompetent organization is not the fix that is needed. Neither is keeping and promoting the old guard who only know the PLCB way. PLCB lifers have no real business experience, because the PLCB isn't a real business.

But if the PLCB is intent on creating high-paying positions that they don't have anybody qualified to fill, I'll offer these suggestions so they can fully mimic what a real business does.

CXO - Chief experience officer - A chief experience officer is the officer responsible for the overall user experience (UX) of an organization. This executive is ultimately responsible for the strategy and user interface design to connect the consumer to the organization's products and services, and may further oversee marketing communications, community relations, internal relations and HR relations. This would then supply someone convenient to blame for the millions of customers who have and continue to have poor experiences with the PLCB. Very handy for the Board to deflect criticism; this should be someone especially expendable.

CFO - Chief Financial Officer - This person manages the corporation’s financial risk.  They deal with data analysis, financial planning and record keeping. Being $240 million in the hole might require somebody to blame, so who better than the CFO?

CHRO - Chief Human Resources Officer - With all the new hires, the PLCB will need to be open longer hours and Sundays, and deliver products. That's gonna take a CHRO to combat the likely 40% turnover rate for new employees (and to blame for it).

CMO - Chief Marketing Officer - Somebody has to be in charge of the new, exciting coupons (and take the blame for their inevitable failure to meet revenue expectations).

CRO - Chief Revenue Officer - You really need this guy to explain to the unions and other PLCB supporters (and maybe even the Democrats in the Legislature) that "revenue" is not "profit". 

CSO - Chief Strategy Officer - Somebody has to be the point of focus to fight every pro-consumer initiative, every threat to the status quo, and any changes that weren't approved by Gifford Pinchot himself. (This position is unique in that it doesn't accept blame, it creates it. Very useful.)

How a real dysfunctional business works. Maybe the PLCB's not that far off...

Of course, all of these people need to report to a CEO, which they haven't had since Conti smeared crap all over title like an incontinent monkey, so you can add that salary to the total. You should be able to waste at least a few million on these folks and their staff  in addition to your new COO position. To make sure you expend the maximum amount, remember to only hire people with no experience in real life retail or liquor — just like was done over the past 80 years.

The only way the liquor and wine business in this state will ever "run like a business"...is if it is a business. Even better: lots of businesses.

Privatize. Accept nothing less.

PLCB - The Avis Of PA Corruption

Pennsylvania Liquor Control Board Celebrates the First Federal Charges of the decade!

 

Harrisburg: The Pennsylvania Liquor Control Board today welcomed local officials and the public to the grand sentencing of the former Fine Wine and Good Spirits Premium Collection Store Marketing Director Jim Short. After the guilty plea, refreshments selected by Mr, Short himself will be available at many State Stores.

Jim's new address offers a warm, welcoming atmosphere for convicts to browse the extensive selection of PLCB Wine and Spirits magazines. The focal point of his new residence is a large center table in the mess hall, where convicts can always find staff to answer questions or provide recommendations. Jim is looking forward to seeing his old friends, Joe "Water Heater" Conti and Pat "PJ" Stapleton soon. Perhaps even Jerry "Muddy" Waters will stop in too.

The PLCB only has us in Liquor Jail, we have them in REAL Jail
Rotten at the top, rotten at the core..

Just like the old AVIS commercial that said they try harder, the PLCB is shooting to be the most corrupt agency in PA, displacing the Turnpike Commission, which held that distinction for years.

This is the brain trust that started "modernization," wine kiosks, spent millions to come up with "Fine Wine And Good Spirits," went into competition against Pennsylvania's wineries in their own state (though strangely all the paperwork has gone missing and nobody can remember who came up with that idea). Did I mention the wine kiosks?

This is what the PLCB has been like for decades, a good ol' boy network of political hacks and has-beens doing favors, taking bribes, arranging sweetheart deals, swimming in nepotism, and generally not giving a crap (until their position is threatened, that is).

Is this what Pennsylvania needs? Or would we be better off with the free market that is proven to work in the 42 other states that don't sell alcohol to their citizens?  What do we really get for this system? Are we safer? Not if you look at the national statistics. Are we better served? Let's ask the people who spend upwards of $300 million out of state: regularly. Are we satisfied? In 40 years of scientific polling there has never been one in favor of the state stores over private retail. I guess the citizens know what works since private retail is how you buy everything else in the state!

This isn't the time for new paint and baskets, this is the time for real change. Change to something that works and has worked since the founding of the state: the free market. The time for 1930's thinking is past and has been for a long time. It is time for the PLCB to be tossed on the junkpile.

END IT, DON'T MEND IT

Read Orwell, understand the PLCB

We all know some of the Orwellian things the PLCB does.* One can see Big Brother gone rampant in ideas like wine kiosks, or after 80 years wanting to get the "right people" (by getting out from under those pesky Civil Service rules). The Ministry of Love is all too apparent in the BLCE with anonymous tips to the beer registry control section. Then there is the Ministry of Truth, hard at work trying to put a positive spin on everything no matter how banal or counter-intuitive it is.

Of course, there is the PLCB's greatest fear...rats. People in the system who are not happy with the rewriting of history (Kiosks were innovative!) who talk to people like me. They send the Thought Police out in the guise of Business Managers to stalk them, and when they are found they are "reintegrated" before their release and ultimate execution - or so they wish. Firing is the best they can do. If a person somehow survives, the powers that be know that his heart is now filled with love for the Party PLCB, and will gladly make any statement to protect them.

They even have their own catchy little phrases:

MONOPOLY IS COMPETITION

CONTROL IS FREEDOM

IGNORANCE IS STRENGTH

LESS CONVENIENCE IS MORE

COMPETITION RAISES PRICES

TAXES ARE PROFIT

It didn't start with Wolf and the Ministry of Truth, of course. Recall Governor " Old Major" Pinchot saying they have to rebel against the evils of the Twenty-first Amendment and run the state their way, making liquor as difficult to procure as possible.** He knows FDR is a drunk and not doing a good job of running things. The three Drys in the state put together a plan where the people live under PLCBism. Where all clerks are equal (except for those that are more equal than others) and they will be looked upon with admiration for the job they do.

One pig man is appointed to lead the people from chronic alcohol use (more than one drink a month), having proclaimed all power over wine and liquor. He uses his private PLCB army to control those who don't believe his power, and crush them. Life at the Pennsylvania Farm gets worse and worse. They don't play well with other states, and punish the animals citizens for wanting better things. They don't want improvement, but control. "Boxer" Newman was a great believer in improving the lot of the citizens, working with great zeal toward the prosperity of the Farm with careful Selections. But the PLCB sees the threat to their control, and sends "Boxer" Newman to his untimely fate as "Napoleon" Conti takes over and begins his plan to build a windmill kiosk at great expense and labor by all. 

When the citizens rebel against this idea, and years of other false promises and schemes, Napoleon aligns himself with powerful forces who like things as they are, to work against the citizens. The citizens notice the free sports outings, strip clubs, booze, golf trips, gifts, bribes, and nepotism at the top. They begin to demand the simple freedoms they see in other states. The PLCB, to counter this new threat to control, puts forth all of its power into "modernizing" its message, saying there will be prosperity for all, not just the "more equal," if they are just given one more chance. Of course, if given that chance, they'll hold onto power for decades to come. Spoiler alert: that's not a happy ending for the animals citizens.

It doesn't have to be that way.
No more lipstick on the PLCB pig!
No more doing things the pig's way!
No more false "modernization"!

END IT, DON'T MEND IT!


*A quick 1984 study guide is here if you need it.
** A quick Animal Farm study guide is here if you need it. 

Ethics questions still percolating at the PLCB

No matter how many pieces of paper the PLCB has to sign, it hasn't changed anything as of yet.

As I reported a year ago today, Jerry Waters, the Executive Director of Regulatory Affairs still has an ongoing ethics investigation and may also be part of the Federal investigation into graft at the PLCB.  If you remember, it took almost two years for the Ethics committee to reach a slap-on-the-wrist decisions for ex-CEO Joe "Water Heater" Conti, ex-Chairman P.J. Stapleton, ex-Director of Marketing James Short, and ex-Director of  Product Selection Matthew Schwenk, all of whom are now being investigated by the FBI.

Nice to know the more things stay the same, the more you can count on the PLCB to do their part to continue be the second-most corrupt agency in PA. Rotten at the top, rotten at the core as the saying goes.

My question is, how long will it be before the next round makes an appearance? If we privatize, there won't be a next round.

News Flash! More ethics problems at the PLCB

In the "Hardly Shocking" Department...

On February 21st, an ethics complaint was filed against PLCB Director of Regulatory Affairs Jerry Waters. It is not the position of this blog to say if he is guilty or not but to report that the violation has been filed. The complaint is listed below (without the numerous pages of supporting documents).

This is yet another ethics complaint filed over the past few years on senior PLCB members, like former CEO Joe Conti, Director of Marketing Jim Short, former Board Chairman PJ Stapleton, and others.  We, the public, have been waiting for the Attorney General to release her decision for some time. Requests are met with the standard "We cannot discuss ongoing investigations" statement. There is some backroom chatter that the the violations have been referred to federal authorities; now wouldn't that be sweet?

I'm gonna miss Joe "Water Heater" Conti

Acting CEO Joe Conti has finally left the PLCB after collecting about $67,000 for 6 months of "emergency" part-time work.  I say acting because he never really was a CEO. He never took responsibility for anything. Never made a sound business decision and never did anything that improved things for the public or even the store workers. Wine kiosks were "innovative"  so much so that he doesn't care if it takes 20 years to settle the lawsuits. "We may have had an error in judgment, and this may be played out over years or decades in litigation, but this was not a faulty fiscal decision.” . Vodka for Mother's Day went over so well that the ISSU, the union of state store managers, called the CEO and the LCB "You are collectively the number one drug pushers in Pennsylvania.".  Obviously that was $142,000 not well spent.

Then there is the $33 million extra that the new computer system cost.  Why?  The AG says it is because the PLCB basically didn't read and understand the contract.. You can read even more background about the events leading up to this in the 2009 Audit. This lead to the double ordering and storing wine in trailers.

That alone would cause the board or the shareholders (US) to remove the CEO but not old Joe he kept chuggin' along with sweetheart deals for Jose Garces giving him a state store within his restaurant - the only one in the state and never repeated.  That lawsuit by other Philly restaurateurs was settled after Jose Garces actually got a license.  Since that was looking like it would work out for awhile Joe tried to get his daughter a job with Stephen Starr by offering him the same special treatment - or at least that is what the AG says.  That investigation for nepotism and graft is still ongoing but it didn't stop the PLCB from bringing Joe back after he resigned. Supposedly for the emergency reason to find his own replacement even though the Governor said he wasn't going to fill the position. Then there was the questionable contract with the husband of a regional manager to teach the clerks how to say please and thank you. Commonly known as "Smile" training it compared the stress of working a register with the stress President Kennedy felt during the Cuban Missile Crisis.  This went over so well that he approved a second year of it even though customer complaints INCREASED after the training. The Auditor General said: "Although this contract was awarded according to the letter of the law, there are several incidents that occurred that raise serious concerns and put the PLCB's procurement procedures in question." And that isn't the first or second or third time the AG has commented on the PLCB procurement or implementation process. (Audits 1992, 2000, 2007, 2009. 2010, 2012)

There is more, so much more but it all is just repeats of his hubris and lack of business sense and of how out of touch the PLCB system is with the wants and needs of the citizens. "The state alcohol system is a Fortune 1000 company", Conti once said and he was a guy who once helped run a restaurant for a while in charge of it.  He said: "At the end of the day, you want convenience,” and to that end he closed 45 stores, gave us wine kiosks and admitted the state still had 30 unprofitable stores in rural areas, but that they lose less than $1 million annually combined (I guess that makes it OK).  If you can't make money in a liquor store with a complete monopoly then something has to be wrong with the system.

I'm gonna miss you Joe, you were the best friend privatization had but I have faith that whomever they find to replace you or any of the board members will be just as incompetent, inexperienced in business and out of touch with the desires of the public and that gives me hope that privatization will take hold here in Pennsylvania.

How can you hate a guy who's lasting legacy will be making the clerks wear "world -class" aprons like Williams Sonoma?

Privatization IS Modernization - Accept Nothing Less

The Circle Game

The Tribune-Review ran this piece today with this stunning headline (be prepared for a shocker):

Reform at Liquor Control Board awash in politics 

Say it ain't so!


"A lot of people like that reform. Maybe we should get us some."

Thanx for the bux, suckers!

And where there's liquor, and politics, and a notable need for reform...there must be Joe "Da ex-CEO" Conti. In this case, it's his job: CEO of the PLCB. Given that the PLCB doesn't even have the required three members on the board (another ethics-challenged blast from the past: it's PJ "Call Me PJ" Stapleton's empty slot that hasn't been filled), and it doesn't look like they're going to be filled anytime soon (since the dysfunctional Senate is now ignoring the Governor's second nominee for the position), really? Why the hell do we need to start paying another political hack $156,700 a year? 

Without it, supporters say, the agency loses a level of professional management and efficiency only possible with a full-time chief executive.

It is to weep. Joe Conti, the embodiment of "professional management and efficiency." Well, look, if I have to remind you...just read the Litany of Conti here. Wow, just can't wait to get someone else in there to get things popping again!

Eventually, the piece comes around to privatization. "A proposal by Senate Majority Leader Dominic Pileggi, R-Delaware County, to phase out state stores and expand where beer, wine and liquor could be sold would recast the chief executive position as an “executive director."" I must have missed this proposal, but that doesn't surprise me; there was a lot going on behind the scenes.

Hey, Norm! What's up with that?

So is this proposal still in play for the September session? It must be, since Senator Jim "Sheetz-Damning" Ferlo is still bad-mouthing it.

“I think the Pileggi model was to micromanage,” Ferlo said. “There's a way for the... Legislature to have oversight, and that's through our appropriations.”

Yeah, except you don't make appropriations for the PLCB, Senator; they have their own sources of revenue (and their own cops, and their own courts, and their own grievance system (it's on page 8)). They don't need you, which is why they ignore you and all of us...until we want privatization. And then they prostrate themselves and suddenly service and selection gets better...until the threat of privatization goes away.

Mark my words: if privatization fails in this legislative session, the State Stores will slowly slide back to Suckville. And then in 10 or 15 years, we'll go through this whole charade again, and someone will call for privatization, and service and selection at the State Stores will remarkably improve...till the proposal fails, and around it goes again. How long do you want to keep playing this stupid game?

PRIVATIZATION IS MODERNIZATION. Accept no substitutes.

Tell your Senator everything the PLCB's doing!

I copied this from a Facebook post; I don't think the original poster will mind. The idea is that while the Senators fiddle and diddle and talk about "modernizing" the PLCB instead of privatizing it -- privatization that the majority of Pennsylvanians continue to support -- we should remind the Senate what a great job the PLCB is doing. So...get on the phone, send an email, and let your Senator know that the PLCB deserves credit for all the things they're doing!

• Tell them that you really thought the wine kiosks were innovative 
• that you thought the date-rape ads were on target 
• that your mother liked the vodka 
• that you didn't mind that your wine sat in an non-air conditioned trailer in the summer 
• that you think the PLCB didn't have anything better to spend the now $35 million+ in computer cost overruns on 
• that bringing back the CEO under investigation for graft is a great idea 
• that TableLeaf is the best thing since the PLCB spent over $4 million to rename Wine and Spirits to Fine Wine and Good Spirits
• that you're impressed with the string of record annual sales figures (and the bookkeeping skills needed to explain why the net assets of the PLCB are negative)
• that thy have an amazing jobs program going that has more employees now with 601 stores then there were with 692 stores in 2000
• that it's great that the PLCB spend more on advertising than on education
• that they're saving money as the 3rd largest purchaser of wine in the world by not bothering to have a trained sommelier on staff?
• that smile training should be mandatory for all state workers (especially when you can keep it "all in the family")
• that you really appreciate having 90 stores less than there were in 2000 so there wouldn't be a liquor store on every corner. 

Pretty amazing when you add it all up, isn't it? Remember: call your senator today...and then call them again next week. And the following week. And so on, till you get a good reason why they'd rather vote against what the citizens want than for it.

Conti's Gone, But Still Lyi -- Getting His Numbers Wrong

I'm 95% opposed to privatization!

We've seen how Joe Da Ex-CEO Conti has consistently misrepresented the facts. He said that privatization would end tax revenues; we all know they wouldn't. He said that border bleed was minimal, less than 2% of total sales; the PLCB's own report on border bleed showed it was greater. He said that the PLCB's own review committee approved the wine kiosk program; the PLCB's press secretary had to admit (the same day) that they had, in fact, advised rejecting the program. He fulminated against privatization as PLCB CEO, exclaiming what a bad idea it was; yet as a Pennsylvania legislator he co-sponsored a bill to privatize the state liquor stores...and now denies it.

So when I saw this 2012 interview quoted today in the Shanken News Daily e-letter, I suspected something might be...Contified about it. Here's what Conti said last January about privatization:

In polls, 50%-60% of Pennsylvanians favor deregulation. Back in the ’80s and ’90s, there was much more public support—around 95%—for deregulation. So there’s not the enthusiasm we saw 20 or 30 years ago. That’s thanks to the PLCB’s various initiatives over the years.

As someone just emailed me, I should have been suspicious when I saw "95%". Politicians didn't get numbers like that in Soviet Russia. Sure enough...Joe's lying again. Oh, hell, okay, he's misremembering, whatever you want to call it. Because here's one poll result (an exit poll of 3,223 primary voters) I found from 1986, in an article in the Philadelphia Inquirer, and it doesn't even come close to 95%:

By slim margins, voters who answered exit polls in Tuesday's primary election said they favored replacing the state-run system of liquor stores with privately operated stores, but they were opposed to legalizing casino gambling in Pennsylvania.
...
The Teichner poll showed that 54 percent of voters shared Scranton's viewpoint and 46 percent wanted to preserve State Stores. That split was reflected along party lines, with most Democrats favoring the status quo and most Republicans supporting change.

Just to cover both decades...here's another one that's quite a bit shy of "95%", from a 1995 Inquirer article:

According to surveys of more than 1,700 people by Mansfield University, two out of three Pennsylvanians - and even more Philadelphians - would rather switch to a free-market liquor system.

Damn, Joe! You did it again! Nice to know the guy's consistent, but holy crap, lying that boldly in a nationally-published interview? I mean, 95% in favor, and the Legislature voted it down? Were we supposed to believe that? So really, support for privatization has been pretty damned consistent for the last 30 years -- and the Legislature has done nothing about it.

By the way..."thanks to the PLCB's various initiatives over the years" takes on a whole new meaning in this light, right? Because the numbers in favor of privatization are higher now, hey, Joe? Rockin' that wine kiosk thing, baby! I'm keeping it real, because you know Joe won't...even as the Ex-CEO. Man, he's gonna kick it when he's back to handle the PLCB emergency!

Why do I bother posting this? Because the anti-privatization groups have no compunction about telling whoppers like this...and no one ever questions them. Don't buy the bullshit!

Joe Conti's Greatest Hits

Joe Da CEO - 12/13/06 -- 2/2/13

Joe Conti's gone, and we're somewhat sorry to see him go. He was, as the alliteration-happy Commonwealth Foundation might put it, The Autocrat of Arrogance, King of The Kiosks, notorious Nabob of Nepotism, and the Duke of (Tone) Deafness. He will be back as a consultant, of course -- he is also the Prince of the Public Trough -- so we have hope that he'll still deliver us a final Endowment of Embarrassment!

In the meantime, here are our most fond memories of Joe Da CEO, and what he did to further the cause of privatization of the State Store System, along with a range of 1-20 points for each incident's CONTI score (that's Corruption, Oblivious-to-Consequences, Nepotism, Thick-Wittedness, and Insider-itis). Plenty of links to the blogposts that describe them too, and I have to say, they're some of my favorites. It was so much fun to rant about Joe Da CEO.

Joe's Job. Conti's CEO position was created out of whole cloth by Governor Ed Rendell, and apparently filled without advertising, without any other candidates being interviewed, and without any real clue on why it was needed. Here's the story. That might explain why Conti seemed to do nothing for the first two years he was in the position (though we were told he spent that time..."planning").
Score: 4. More about Joe, than it is Joe...but the shape of things to come.

Dr. Rendellstein's Monster. This was a minor incident, but one of my favorites, because it illustrated just how overly-independent the PLCB is. Rendell hears about the original TableLeaf "rebranding" idea, and has Conti in to talk about it. "The governor expressed his opinion that the PLCB stores as currently named were recognizable and had a brand value of their own and he strongly discouraged PLCB from attempting to change the names of the stores... The governor was vocal in making his opinion known." Conti recalled the meeting differently. "[Conti] described the meeting with Mr. Rendell as "more a directional discussion" covering a wide range of topics. "The governor was delighted with everything he saw," said Mr. Conti." Just amazing.
Score: 8. A small gem of Continess.

Playing Restaurant Favorites. On Conti's watch: the PLCB opened a mini-winestore inside Garces Trading Company, Jose Garces deli/grocery. Really kind of cool...and really kind of unfair to all the other BYOs in Philly who would love to have a little winestore in-house, but never got asked (except when Conti allegedly offered one to Stephen Starr...see below). No more have opened, and Garces has distanced himself from the concept.
Score: 9. Tone-deaf, but Conti was not too publicly vocal about it. 

TableLeaf. He spent a lot of money on it for no understandable reason: rebranding a legal, police-enforced monopoly? When that got too ugly, he changed his mind and taped it on the front of a PLCB-created "house" wine brand. And then, when people got pissed off that the house brand was deliberately undercutting private winemakers...he lied about it.
Score: 10. Classic Conti characteristics, but a fairly small affair; an extra point for some bold lying. 

Fighting Privatization. Despite noting several times that it wasn't his job to fight privatization -- that was all up to the Legislature! -- Conti spent a lot of public time doing just that. One of the best was during this Legislative hearing, where he did what he does so well. He lied (about how much money privatization would "lose" the State, and about the results of the PLCB's internal review of the wine kiosks), he blustered, he threatened, and he obfuscated...all of it while fighting the idea of privatization, which he said he wasn't there to do.
Score: 11. No corruption, just doing his job. Wait...he said it wasn't his job. It's confusing.  

How many wine kiosks did you want?

The Death of the Wine Kiosks. Almost as much fun as the spectacle of the Wine Kiosks themselves was Conti's complete loss of reality-grip when the The Invincible Wine Robot Army (see below) was finally defeated at the Battle of Wegmans. Faced with total annihilation of his cherished idea, and the utter commercial failure of the misbegotten wine automata, what was Conti's reaction? "It certainly wasn't a failure." "I still think there is merit to the program." "It didn't end up successful, but we learned a lot and we will end up better for it."
Score: 13. Would have been higher, but no nepotism or (detectable) corruption. Just arrogance and stupidity. 

The Courtesy Contract. If you've forgotten...the PLCB let a contract (on a low-ball bid) for "Improving basic customer service skills" to a company run by the husband of a PLCB regional manager. Conti's watch, and he loved it: "This is a vast adventure, and it's one we have to take," he said And the training was ridiculous, probably unnecessary (there was a customer complaint once every 288,000 transactions...), and ineffective: customer complaints actually went up after the training. And Conti decided to continue it. The Auditor General said: "Although this contract was awarded according to the letter of the law, there are several incidents that occurred that raise serious concerns and put the PLCB's procurement procedures in question." Conti's reaction? Vindication. Classic.
Score: 14. No obvious personal corruption. And the nepotism was someone else's... 

The Wine Kiosks (AKA The Invincible Wine Robot Army). The most amazing idea that could never work. Here's a video of just how ridiculous they were in case you'd forgotten:



Conti oversaw this Carnival of FAIL from the initial flawed idea, through the single-bidder contract (to the completely inexperienced company that was heavy with contributors to Gov. Rendell's campaign), through overriding the advice of a PLCB internal review to reject the idea (which he then lied about to a Legislative hearing) to the bloated execution (which hid costs) and the eventual disaster that was the implementation. You can see most of that here.
Score: 18. Close to perfect, but no obvious nepotism.

Contigate. According to the state Inspector General, Conti accepted Phillies and Union tickets from PLCB vendors and "lobbied" vendors and restaurateur Stephen Starr for a job for his daughter; Conti may also have hinted in the same conversation with Starr that maybe Starr could get one of the sweet in-store PLCB "winebox" pop-up stores like Jose Garces got (and NO ONE ELSE seems to be able to get). And...he was dumb enough (or arrogant enough; your pick) to use his State-issued Blackberry to do the business.  Score: 20. Doesn't get much more Conti than this.


Ah, Joe, Joe...it was great to have you around. It kept the fight interesting, and kept it fair, too. I mean, it was just 2/3 of the citizens of the Commonwealth vs. the UFCW and the Legislature! But you and your great ideas like the wine kiosks kept us going!

Too bad the PLCB's dumb enough to hire you back at $80 an hour as a consultant. Yeah, really, they are...on an official "emergency" basis. That's a move so dumb you'd almost think it was Joe's... Score: 22.

Is Privatization Dead? Not at all!

The Legislative session is effectively over, and the privatization bill has died with it. No one's doing anything till after the election, at which point privatization would have to be re-introduced. Mike Turzai, the vocal champion of privatization in the State House, damaged himself badly with a gaffe about voter ID, and by failing to bring privatization to a vote. Governor Corbett has said recently that privatization is still a top priority, and that he will present a proposal next year, but the Legislature may change hands, and his approval ratings are low.

We're screwed, it appears.

Oh, shut up. That's just what the PLCB partisans want you to believe! The truth is that the PLCB's incompetence is the gift that keeps on giving. As long as they keep screwing up, privatization is going to be in the Legislature's face, and the Internet makes it even easier to keep up the pressure.

Don't believe me? Take a look at this recent Philadelphia Inquirer poll. "The poll found that 55 percent of respondents supported privatization, 28 percent opposed it, and 17 percent either did not know or did not answer." That's almost 2 to 1 in favor among those who have an opinion. It gets better: "61 percent of respondents in the bipartisan survey said they supported allowing grocery stores to sell beer and wine." Even the clueless Legislature can't ignore numbers like that forever (except they will, because the unions that represent the State Store workers continue to get right in their faces and remind them that they vote and that they give lots of juicy campaign donations).

The PLCB stepped in it again during Sandy last week, when they shut down the entire State Store System for two days. Now, some of the stores were without power, and some were in areas where it was dangerous to drive...but the PLCB drove home the problem with a stupid state-wide monopoly by shutting down every single store, regardless of local conditions. Even some of the employees admitted it was a stupid thing to do.

Want more? How about even more bad press for the goofballs who run the PLCB and the State Store System? That's right, Joe Da CEO was in the news again, and it wasn't because he's a great humanitarian. It's about that dopey Tableleaf in-house wine brand they shoved down the throats of Pennsylvanians. The Legislature wanted to know how and why this lowball wine brand came to be on the State Store System Shelves in (unfair) competition with other brands, and Conti told them that vendors approached the PLCB with wine samples. But that's not the story PLCB marketing director Jim Short tells: he says he went to the wine companies looking for cheap wine to put under the Tableleaf label. Hmmm...a falling out between two of the people at the PLCB under investigation for corruption with vendors? 

It gets worse, according to a story on the TribLive website:

Conti told the House committee that the Wine and Spirits Advisory Council, a group of consumers and liquor license holders empaneled by the LCB, tasted samples of wine submitted for consideration by a number of vendors competing for the TableLeaf brand, transcripts show. But those council members deny being involved.

...

In later interviews with the Trib, Conti changed his story again, stating that an LCB wine educator and outside sommelier tasted samples submitted by vendors.

But Judy Carroll, a wine educator for the central region of the state, said educators don’t play a role in choosing products. “I do classes and seminars with the people who work in the (state) stores,” Carroll said.She said her six counterparts elsewhere in the state all do the same thing: conduct classes to educate state store workers.

And Melissa Monosoff, the sommelier under contract with the LCB from December 2007 through November 2011, said she was not involved in the development or selection of TableLeaf wines “in the slightest” and had “no idea who was.”

Conti, once again, has apparently misspoken. That's the arrogance of the PLCB for you.

Want more? How about this: The LCB, the Board itself, is making a dumb show of its obligation to meet publicly. Check this out, again from the TribLive website:

A Tribune-Review analysis of nearly three years of LCB meeting records, along with attendance at meetings, shows many of the board’s twice-monthly meetings lasted just 15 to 20 minutes with little or no public discussion before votes. Critics speculate the lack of discussion means the bulk of the agency’s decision-making occurs out of public view.

“It appears that ... the staff and the board members have developed a way of doing business that is difficult, if not impossible, for an average citizen to follow,” said Senate Majority Leader Dominic Pileggi, R-Delaware County, an advocate for increased government openness.

“Certainly, these issues of how the board operates will be given a fresh look as we work through the legislation for changing the way citizens are able to buy alcohol,” Pileggi said.

Unfortunately, what Pileggi means here is that the Legislature is still considering the ill-advised "Modernization" program that the PLCB is advising! Does this make sense? Here's an agency that is crippled by incompetency, riddled with corruption, consumed with its own arrogance...and you think it's a good idea to let them tell you what's needed to fix their problems?! 

We have a big job ahead of us in 2013. We need to remind Governor Corbett of his promises. We need to remind the Legislature and Senator Pileggi that we want privatization, not some crappy "modernization." We need to get a good, fair bill that gives us privatization that makes sense, not the cock-eyed greedfest that got passed in Washington (that people still seem to prefer to the old state store system). And we need to get serious about it. 

Get started now. If you're in the Philadelphia area, please come out this Thursday to Yards brewing for our second beer laws forum: if you WANT it to cover privatization, I'm willing to expand the conversation. We had 100 people at the last one, I'd love to have an overflow crowd. We're going to be talking about how to take action. It's time to get rolling.

How to 'save' the State Stores and make privatization go away

All this time we've been talking about privatizing, and the union and the social conservatives and the beer retailers have been railing about it, and yet the talk continues...wanna know a secret?

It would be really easy to get Pennsylvanians to accept the State Store System forever.

Really. Here's all you have to do.

1. Change the name of the Johnstown Flood Emergency Tax. Just change the name. Call it the Pennsylvania Alcohol Excise Tax, and most people will never say another word about it. It's the idea that the tax was for the Johnstown Flood and we're still paying it that drives them crazy.
2. Get rid of Joe Conti and the CEO position. The man's a disaster: the wine kiosks alone would prove that, but the constant ethics investigations are a drag as well. The CEO position is such an obvious patronage job that it's painful.
3. End the police-enforced monopoly. Just give up. It's rarely enforced, and it's galling to Pennsylvanians. Accept you're going to have to compete with businesses over the border...just like every other retailer does (and consider lowering the PA Alcohol Excise Tax to be more competitive...and watch sales go up, and overall revenues go up as people have fewer reasons to buy booze -- and food, and gas, and everything else -- outside of PA).
4. Kill the case law. It's not part of the State Store embroglio, but it's a thorn in our sides, and taking it away will calm us down. 
5. Link advancement of product knowledge to retention and promotion in the work force. If the union wants to keep their jobs, have them make this major concession: their retail jobs will actually depend on them selling products. 
6. Double the number of stores, kill the stock requirements, and allow local control of stocking. Do we really need 2500 SKUs in Clarks Summit, when you can -- supposedly -- easily order something through the stores? Cut the operational costs of running State Stores. Allow local control of ordering, not one plan put in place in all stores by a committee in Harrisburg.
7. Put the BLCE back under the PLCB. The PLCB and their enforcement arm don't work together. The BLCE used to be part of the PLCB; put them back together.
8. Make the PLCB answerable to the State Government. A lot of the arrogance and crap we've seen out of the PLCB over the past five years stems directly from the agency's independence. There's no reason it should be so independent. The easiest way would be to make it part of the Department of Revenue.

Do those things, and Pennsylvanians will be satisfied enough that privatization will never pass. Not in my lifetime.

Why do I lay this out, when I dearly want privatization to pass? Simple. I know the Legislature and the PLCB will never get their shit together enough to do any of this, even though none of it would hurt state revenues.