Newly-elected Pennsylvania Gov. Tom Wolf, however, does not support liquor privatization and has stated that he will veto any bill wishing to abolish the PLCB.
This statement flies into the face of one of America’s most championed values: the trust in the free market to keep business efficient and prices lower for consumers. But Wolf is right. Keeping the liquor business under state control is the right move for Pennsylvanians.
Largely voted for by House Republicans – only four House Republicans voted against the bill – the abolishment of the PLCB has been a contentious issue in Pennsylvania politics for quite some time. The PLCB currently runs all of Pennsylvania’s wine and liquor stores and lends itself to the reasoning of Pennsylvania’s strict liquor laws, which doesn’t allow sale of beer or liquor in local corner and grocery stores. Pennsylvania State House Majority Leader Mike Turzai, a Republican, summarized the bill on his website:
“We have an opportunity to move Pennsylvania into the 21st century by allowing the private sector to sell wine and spirits. This approach will result in better selection, cheaper prices and more convenience for consumers.”
A lot of Temple students agree with these sentiments, especially when it comes to convenience.
“To throw a party in Pennsylvania you have to go to the grocery store for food, beer distributor to get enough beer, and then go to the liquor store,” senior management information systems major Charlie Cappelli said. “That’s a lot of driving around.”
Senior finance major Ellis Holmes agrees.
“Coming from New York, I find it the oddest thing that I cannot roll up into a 7-Eleven … and not buy liquor,” he said. “I go back home and sure enough, I can buy a six-pack right at the nearest Walgreens.”
But entrusting Pennsylvania’s liquor business to the free market would do more harm than good. Privatization of the liquor industry would do the opposite of what Turzai says, hurting both consumer pricing and selection, while eliminating jobs of those employed by liquor stores run by the PLCB and the business of popular local breweries across the city.
An article published by the Pittsburgh Post-Gazette in July 2014 compared prices for a range of different liquors in Pennsylvania state stores to those in neighboring states Ohio and West Virginia. According to the article, “the LCB was cheaper half the time and more expensive half the time.” Pennsylvania liquor prices are already competitive despite not being set by the free market.
And since the PLCB has the buying power to buy liquor wholesale for the retail stores it runs, relinquishing control from the PLCB could result in higher prices for consumers. Smaller liquor stores would not be able to purchase the volume that the PLCB does for its retail stores, or necessarily be able to carry the stock that PLCB stores can, leading to less selection, higher prices and less people employed due to lower profit margins.
According to the PLCB’s website, the PLCB currently employs over 3,000 people statewide – 2,220 of those being retail clerks. Should the liquor business be privatized and these retail stores be closed, jobs could suffer a major bout of uncertainty.
Wendell Young IV, president of the United Food and Commercial Workers Local 1776 union, which represents many PLCB employees said in a statement, “The PLCB is a profitable asset that continues to set records in total sales and profits. Last year alone, the agency returned more than $565 million in profits, transfers and taxes to this commonwealth. It makes no sense to sell it off to the big chain retailers and put 5,000 Pennsylvanians out of work in the bargain.”
These profits from state ownership of the PLCB retail liquor stores generates income for the state. According to the PLCB website, in 2013, 4 percent – or $80 Million dollars of the PLCB’s revenue – was transferred to the Pennsylvania Treasury’s General Fund. Privatizing the liquor industry in Pennsylvania could cause a budget shortfall, and politicians could sell this as a reason for a tax increase.
Pricing aside, Temple students seem to lean towards privatization because of convenience and availability.
The laws have led to a shortage of beer and liquor stores around Main Campus, causing an inconvenience for some students.
“The closest liquor store is way down Diamond [Street],” Cappelli said. “Most Temple students aren’t comfortable walking there. Everyone I talk to either goes to 20th and Fairmount … or one of the ones in Center City. If you consider the campus [as] the Temple police boundaries, they end right at the only beer distributor [at 18th and Montgomery], and there’s no liquor store.”
While the current Pennsylvania liquor laws may come as an inconvenience for some consumers due to the lack of retail stores and more limited hours, this is just a small price to pay for benefits and jobs created from liquor stores being stated owned.
Christian Matozzo can be reached email@example.com.