Wither the State Store?

Since the end of Prohibition in the early 1930’s, Pennsylvanians have been able to purchase liquor and wines only in the State Stores (more recently, the “Wine and Spirit Shoppes”). The State has created a monopoly which has as its original purpose the regulation and control of alcoholic beverages. (Beer and other malt beverages are sold through private distributors and a limited number of delicatessens.)

It is said that the state monopoly is the largest single wholesaler of liquor and wines in the world. It is also a system which has been under attack from its inception by those who maintain that the state has no business in this business; in fact Senator Stewart Greenleaf of Montgomery County has announced that he plans to introduce – for the ninth consecutive session of the legislature – a bill which would privatize the system.

Detractors of the system maintain that it has spawned yet one more bloated bureaucracy; that the Pennsylvania prices for most items are much higher than those in neighboring states where competitve pressures are at work; that the State Stores are unattractive and not accommodating; that the selections available are severely limited particularly in regard to wines where the level of sophistication throughout the country has increased; and finally they argue that given the enormous gross revenues of the system, the profits are woefully inadequate.

Supporters of the system maintain that the volatile nature of alcohol more than justifies tight regulation; that the transformation of the stores into “shoppes” has brought with it a whole new range of products (particularly wines), enhanced aesthetics, and a much improved attitude of the employees; and that the system has become much more sensitive to competitive pricing (special promotions throughout the stores are common now).

This may be the year in which Senator Greenleaf’s bill is adopted. The Governor has declared his unalloyed support for the bill and has coupled it with a promise to apply the “profits” from the sale of the system to support proposed new stadiums in Philadelphia and Pittsburgh, a not too carefully disguised effort to win the support of the sports-minded couch-potatoes. Since both Houses in the Legislature and the Governor are Republican, and surveys show public support in the range of 70% for the bill, the monopoly may be facing its demise.

If the bill does become law a number of questions arise. Who will be the new licensees? How will they parcel the licenses out, by lottery, auction? How regulated will they be? What will become of the existing stores and employees? Will we be able to buy wine in the grocery stores and supermarkets?

Bears watching.
– Ken Butera

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