Why Not Leave Them Closed?

We have a tremendous opportunity before us. We must not waver. We must not hesitate.

The State Stores could easily be closed by June.

Let me explain. 

I have a tremendous idea!!

By now, you all must know that Governor Wolf has declared that the State Store System of Stores is CLOSED, nominally because of the COVID-19 pandemic. Shut down as of 9 PM on St. Patrick's Day, of all inane coincidences. What's more, the PLCB's FWGS website is no longer delivering booze to your door (you know, because they never really wanted to anyway), AND the licensee "service centers" are also closed (all the bars are closed anyway, except for takeout food and beer, two things with which the PLCB is entirely uninterested).

Wow. And as I was writing this earlier, Wolf issued a proclamation (link will download a PDF of the letter) shutting down ALL licensee operations that involve selling food or drink (of any kind) for consumption on premises. Take-out/to-go is still allowed, but one wonders for how long (see below). The only exception is for hotel room service.

Note: licensee operations only. Restaurants, lunch counters, etc. that are NOT licensed are still asked to voluntarily limit operation to take-out only. Wolf is doing this under the authority of The Almighty Liquor Code: "The PLCB, upon authorization from the Governor, has the authority under the Liquor Code (47 P.S. §4-462) to mandate the closure of licensed establishments in times of emergency."

Here's what you see when you go to Ye Olde Fine Wine Et Goode Spyrites site of Web:

Reaction has been mixed. There was an insane rush to the stores, people standing in line for half an hour, as if they were Fine Bottled Water and Good Toilet Paper Shops. People say, oh, you don't need booze (idiots). Or they say, booze is as necessary as groceries and medicine, which, if you really think that, then why didn't you tell your state rep that years ago and get it out of the state's incompetent control? Eh, another missed opportunity.

Back to today. Why did the governor close the State Stores, and not close beer distributors, not close the sales rooms of wineries, distilleries, or breweries (yes, and meaderies and cideries and kvasserei)? Simply because he could, most likely, and possibly because of union pressure. Naturally enough, why is not a question that's been asked of Wolf directly. It's much more important that we do 'flatten the curve' and get this damned virus under control. Believe me, that's absolutely true. Retail operations, particularly small ones, are going to take a whupping here, and that's going to be disastrous for the economy.

But that's not what we're here to talk about. It's about the opportunity to finally put an end to the ridiculous State Store System of Stores. 

Rahm Emanuel's famous quote was about the 2008 recession. He followed the famous part with this:

"This is an opportunity, what used to be long-term problems, be they in the health care area, energy area, education area, fiscal area, tax area, regulatory reform area, things that we have postponed for too long, that were long-term, are now immediate and must be dealt with."

Are the State Stores an immediate problem? Are they one that "must be dealt with"? Of course not. I'm not a fool. No one's livelihood or survival is threatened by the continued existence of this Relic of Repeal, this Fossil of Prohibition.

But it is definitely falls under "thing that we have postponed for too long," making this is a unique opportunity to deal with it. The State Stores will be closed for at least two weeks, probably more. And the Governor, a Democratic governor, has openly admitted that the State Stores are not necessary to serve the needs of the citizens of the state. 

He did? When did he say that? In the letter to Pennsylvania businesses (dated March 14) from Wolf's Secretaries of Health, and Community and Economic Development, there is a list of descriptions of "non-essential businesses" that are asked to close. At the end of that list, there are these bullet points:

NOTE: Liquor stores will begin an orderly closure. Individuals can still buy wine and beer at grocery stores with PLCB licenses
NOTE: Restaurants should stay open for carry-out and delivery only

You see? The State Stores can close because people can still buy wine at grocery stores and restaurants. Of course they can, and they do, in huge, growing amounts.

If the State would allow grocery stores (and beer distributors, and restaurants, and deli licenses, and private clubs) to sell spirits by the bottle -- and really, why not? It's all the same alcohol! -- we could just leave the State Stores closed. Never open them again.

It's not that hard. Have an auction, sell off the inventory, and have time for new businesses to get licenses and open with former State Store employees at the register (or at the helm, why not?).

At the very least, the Legislature should immediately adjust The Almighty Liquor Code to allow licensees -- grocery stores, bars, and beer distributors to add off-premise, take-out spirits sales. End this ridiculous prejudice against spirits. Let mom pick up a bottle of Bailey's at the Giant Eagle.

And do away with the stupid cafe requirements (because...we're only doing take-out now, and the world hasn't ended), and the childish "buy four bottles and step outside the door" limit. What ridiculous bullshit is that, anyway?

We could do this. It's just waiting to happen.

"...it's an opportunity to do things you think you could not do before." Clearly Governor Wolf is ready.

PRIVATIZE. And if we can't do that, take the spirits monopoly away from the State Stores. The grocery stores have earned it, beer distributors have earned it by staying open during the crisis...something the State Stores weren't prepared to do. 

"Just give me something"

I was talking to a licensee (that's PLCB-speak for a bar owner) the other day about this whole thing. What do you guys think about the movements towards privatization, I asked her.*

"What kind of chances do you think it has?" she asked in response. "Is this really going to happen?" I said that I'd heard G. Terry Madonna, the Pennsylvania politics maven at Franklin & Marshall College (full disclosure: I am a proud F&M grad, class of 1981, and if you have high school age children, you should consider this excellent college.) discussing it; his opinion was that it was the best shot we'd had at privatization since Repeal...and he gave it a 40% shot. That was back in the spring, though, and things had moved forward since then; insiders tell me that the votes are there in the House, and the Senate's swinging our way (and there may yet be some action from a Marcellus Shale tax deal; a 'you vote for my bill, I'll vote for yours' kinda thing). So again, I said...what do the licensees think about this?

"I'll tell you," he* said, and paused. "The Tavern Owners don't know what to do. You know, it would be great; in other states, the Absolut rep would come to you and say, 'I got a deal on this week; you buy two cases, I give you this price,' and I could say, well, what can you give me if I buy four cases, and he'd say...ooookay, and he'd give me another price, and then, then I could pass that on to the customers, do a special that week." And, I said, not only that, they'd deliver it to you. "Right!" they both* said, beaming.

"But you know," he* continued, and got right in my face: "The prices we have to pay are crazy. We don't get a good discount. And the beer sales thing? [meaning the six-pack sale monopoly taverns currently have] We know the beer stores are going to get into wine and liquor sales if this goes private; they've got the money, they're already set up. We're going to lose a lot of takeout sales [we'd already guessed that wine and spirits in the distributors would mean sixpack sales there as well], I know that, but no one's putting anything for us in the privatization [bill]. Just give me something! Ease up some of the regulations, cut back on the fees; just give me something."

Why don't you say something, I asked. They* shook their heads, and she* said, "We don't know if it's going through." The implication was clear: no one wants to piss off the PLCB by being openly pro-privatization...and then face the bureaucrats if it fails.

My advice to the 'privateers' (as Hereditary Union President For Life Wendell W. Young IV has wittily tagged the pro-privatization forces): give them something. Put something in the bill that acknowledges licensees are getting a raw deal; level the playing field by putting no exclusivity on suppliers -- let licensees buy from whatever source they want -- or take off that ridiculous 'happy hour' restriction, or let all bars sell packaged goods (to-go wine, liquor, and beer) and don't tell them how they have to do it. You'll get a powerful ally...and be a giant step closer to getting privatization.


*Might have been a woman, might have been a guy, might have been a husband and wife; might have been around here, might have been up in Clinton County where I was vacationing...I ain't saying, for obvious reasons.

Wegmans to PLCB: get these lemons out of our store

Ah, it's sweet when another dopey plan by the PLCB is a complete failure. WGAL-TV in Lancaster is reporting that the Wegmans grocery store chain has requested the PLCB to remove the wine kiosks from their stores. Check out the story here; and you can read the actual letter here. It's wonderful to be so right about something; the wine kiosks have been an unadulterated disaster. They were unwieldy, they were insulting, they were the result of graft and crap, they were another desperate and obvious attempt to stave off privatization, but worst of all, they didn't even work. Permit me a little gloating; it is so good to have been so right about this.


Enjoy this video from two Californians baffled and bemused by The Wonderful Wink Kiosk!

What's next? Well, it's not good, unfortunately. Because Senator John Pippy is apparently losing the guts to push for privatization. He's wimping out and talking about settling for some of the alternatives the PLCB is suggesting. I've got a better idea, Senator Pippy; how about you listen to the citizens of Pennsylvania, who continue to support privatization at a ratio of 2:1 or better? How about you consider that instead of the pleas of a bunch of entrenched bureaucrats who don't give a damn about anything but their jobs, their budgets, their secure power? Why keep this fossil, reeking of 70+ years of patronage and patronization? Cui bono, Senator?

Privatization chances handicapped by experts

See that quote over to the right, from former PLCB chairman (1995-2002) John Jones? He's talking about Tom Ridge's attempt to privatize the PLCB in 1997, and why it didn't work: lack of support in the legislature and the public. Read it again:

"...there was [in 1997] no overarching passion within the General Assembly, or in the public at large, for privatization. Unless and until there is a general hue and cry, it is very unlikely there will be a privatization initiative that succeeds."

Jones and other former PLCB members are quoted at length in today's Scranton Times-Tribune, giving their impressions on the chances of privatization succeeding this time around. I found these quotes by Jones's predecessor, James A. Goodman, who served from 1987 to May 1995, to speak directly to Jones's previous statement.

"Since the system has been in existence, there have been bills in the Legislature" to privatize state-run liquor stores, Mr. Goodman told Times-Shamrock Newspapers on Monday. "But I would consider this to be the most serious threat for it to happen. You have the governor and you have the majority leader (state House Republican Majority Leader Mike Turzai, R-28, Pittsburgh) as the prime sponsor of the bill. That's a lot of juice. And you have newspapers ... editorializing in favor of it all over the state."

Don't think that means Goodman is in favor of privatization. He said he opposes it, apparently (the paper didn't quote him directly) because the system funds alcohol education and enforcement efforts. Well...given the problems we've had with enforcement efforts, maybe they could use some shaking up.

Here's something I just don't get. One of the arguments against privatization is brought up by John Reiley, who was the PLCB secretary for 29 years (WTF? Really?!): "One driving force behind the effort is "big business trying to latch onto those profits" that the state now sees through its monopoly on liquor sales, Mr. Reiley said." Well...yeah! That's what retail business does. It's called capitalism, and the profit motive, and that's the reigning model in the United States, has been since 1776. Supporting the PLCB against privatization is anti-business, plain and simple...which smacks of anti-Americanism.

One of the biggest balls of bull that's being batted around (on both sides of the debate) is the number on what the State might net by auctioning off liquor store and wholesale licenses (and real estate, and stock, and fixtures, and all that jazz). It's all either pie in the sky numbers from those in favor, or lowballs from those opposed (mostly the union, but also religious groups and anti-booze groups, who are really drinking the "control" Kool-Aid). We need real numbers; and the paper also has a report on a possiblity that the House will contract for an independent study on that. Good. We need real numbers.

Because this is important. Turzai is pushing to have a bill through the legislature by Memorial Day. To move that fast, we need real information, and we need real alternatives. My major issues with Turzai's legislation? Not enough licenses (we really ought to have at least 1,200, not 750), and not enough limits on who gets them (I really like the idea of no company getting more than three, but 10% is too many; and I'd really like to keep any current or former legislators out of ownership). And maybe some other stuff. Discuss!!!