Published: Sunday, October 17, 2010
Herald endorsement / The liquor initiatives
Yes on I-1100, no on I-1105
We’ve argued repeatedly in this space that state government must refocus on providing core services that the private sector can’t do as well. The distribution and sale of liquor is clearly not among them.
With the Legislature showing little interest in abandoning the state’s monopoly on hard liquor sales, two initiatives surfaced this year that would get the state out of the booze business.
We recommend a yes vote on Initiative 1100, which would close all state liquor stores, including those run under contract, and require the state to sell its huge liquor distribution center in Seattle. It also would clear away many archaic rules that were established after the repeal of Prohibition, rules that haven’t made sense for years. Among other things, they ban direct sales from manufacturers to retailers, the extension of credit for liquor sales to retailers, and discounts on bulk purchases.
We encourage a no vote on Initiative 1105, which also would get the state out of the liquor business, but hold onto unnecessary requirements that favor distributors and keep prices artificially high. Retailers would have to buy liquor through a middleman.
Opponents of both initiatives make two main arguments: that opening hard liquor sales to retail stores that currently sell beer and wine presents a public safety problem, and that both initiatives would leave the state with less revenue at a time when it can least afford it.
In truth, it’s impossible to know the effect I-1100 would have on state and local revenue, because the market will determine liquor pricing and sales volume. I-1100 does keep current liquor taxes in place. I-1105, on the other hand, eliminates current taxes on hard liquor. It directs the Legislature to replace lost revenues with a new tax, but that might prove diffucult. If Tim Eyman’s Initiative 1053 passes, passing a new tax would require a hard-to-get, two-thirds legislative majority.
As for public safety, a study last year by the Commonwealth Foundation, which examined data from 48 states over a 36-year period, found no link between privatization of liquor sales and increased alcohol consumption or traffic fatalities involving impaired drivers.
It’s also worth noting that much of the funding for the “no” campaign comes from the beer industry, which would seem more interested in market share than state revenue or public safety.
The state Liquor Control Board has an important role to play in licensing and enforcement, but not in sales and distribution. The private sector can handle that just fine, even without artificial restrictions that keep retailers from offering consumers the best value possible.
With the Legislature showing little interest in abandoning the state’s monopoly on hard liquor sales, two initiatives surfaced this year that would get the state out of the booze business.
We recommend a yes vote on Initiative 1100, which would close all state liquor stores, including those run under contract, and require the state to sell its huge liquor distribution center in Seattle. It also would clear away many archaic rules that were established after the repeal of Prohibition, rules that haven’t made sense for years. Among other things, they ban direct sales from manufacturers to retailers, the extension of credit for liquor sales to retailers, and discounts on bulk purchases.
We encourage a no vote on Initiative 1105, which also would get the state out of the liquor business, but hold onto unnecessary requirements that favor distributors and keep prices artificially high. Retailers would have to buy liquor through a middleman.
Opponents of both initiatives make two main arguments: that opening hard liquor sales to retail stores that currently sell beer and wine presents a public safety problem, and that both initiatives would leave the state with less revenue at a time when it can least afford it.
In truth, it’s impossible to know the effect I-1100 would have on state and local revenue, because the market will determine liquor pricing and sales volume. I-1100 does keep current liquor taxes in place. I-1105, on the other hand, eliminates current taxes on hard liquor. It directs the Legislature to replace lost revenues with a new tax, but that might prove diffucult. If Tim Eyman’s Initiative 1053 passes, passing a new tax would require a hard-to-get, two-thirds legislative majority.
As for public safety, a study last year by the Commonwealth Foundation, which examined data from 48 states over a 36-year period, found no link between privatization of liquor sales and increased alcohol consumption or traffic fatalities involving impaired drivers.
It’s also worth noting that much of the funding for the “no” campaign comes from the beer industry, which would seem more interested in market share than state revenue or public safety.
The state Liquor Control Board has an important role to play in licensing and enforcement, but not in sales and distribution. The private sector can handle that just fine, even without artificial restrictions that keep retailers from offering consumers the best value possible.
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