Beer Distributors Plead for Continuing Their Special Privilege

When someone’s ox is about to be gored, that person can be expected to protest loudly. Certainly spokespersons for Pennsylvania’s beer distributors, who have a virtual monopoly on retail sales, were in full throated condemnation of legislation that would strip them of that monopoly. Claims that thousands of people would lose their jobs were front in center of the argument-the typical, predictable assertion of almost everyone opposed to any action that promises to eliminate a government created monopoly.

Bottom line: jobs supported by monopoly power granted by the government that are over and above what the free market provision of a good or service would create must be the result of transferring income from consumers to the monopoly providers that is above what a market provided good or service would be. In other words, if the number of full time equivalent employees involved in retailing beer in the current "distributor" regime is higher than will be needed in a free market regime, their income represents an unnecessary transfer of income from consumers. Income that could be used to purchases other goods and services and create other jobs. And it is a virtual certainty that the non-money value of convenience for retail consumers who will be able to buy beer while shopping for groceries or for convenience store items will be enormous. Not to mention the time and gasoline saved not having to make a special trip to a "distributor" store.

Finally, the claim that consumers will have fewer choices of product is laughable. A visit to a major super market chain store in states where beer is sold in grocery stores will reveal a mind numbing array of beers, ales, and other low alcohol beverages available in six packs, quart bottles, in single bottle sales and so on. The variety and choice argument is another indication of just how deeply ingrained the anti-free market mentality has become in Pennsylvania, even among people who are engaged in business activities.

Pennsylvania Staggers into the Twentieth Century

The State Liquor Control Board has approved licenses for two local grocery stores to begin beer sales. While this is certainly a positive step for the Commonwealth, it does not exactly shatter the beer distributor system or bring this state on par with others who allow beer sales in supermarkets.

The licenses come with strict stipulations. The stores are only allowed to sell the equivalent of two six packs and the sales must come from café style areas separated from the rest of the store. It amounts to allowing a beer store to operate within a store and does not offer the complete freedom and convenience customers in other states enjoy. But it is a step in the right direction.

Of course this decision is not without its opposition. The Malt Beverage Distributors Association has challenged a similar license granted to a supermarket elsewhere in the state. This challenge has reached the state Supreme Court and is expected to be heard in the spring. Whether or not Pennsylvania’s beer and liquor sales are allowed to enter the twentieth century will hinge on their decision.