"And so the whole point of taxing liquor - because it's cheap to make - is to keep it artifically scarce by the tax and thereby having less people using it."
1) The primary purpose of taxing liquor is that the gov't has a legal way of taking money from you and redistributing same as it sees fit. (Given the expanded choices, anyone want to bet that the net taxes accruing to the gov't have increased?)
2) Don't ya just love it when some arrogant pinko wag decides for you what's in your best interest?
3) The primary purpose of the union's whining is that it doesn't dig the idea that expanded consumer freedom and improved service comes at its expense. Why, it's as if the unions weren't a net benefit in the economy either. (Imagine that!)
4) Fewer people. Fewer problems. Artificially. Is there a union rule about spell-check or grammar-check? (Don't even bother asking for reality-check.)
Here in Quebec, where the SAQ union has been on strike for months, I still think the solution is privatizing the sale of liquor.
I mean, most of the SAQ stores have been sitting boarded up, and the few scattered ones that are open are staffed by manangement. And yet the stores still took in 85% of last year's net revenue for the holiday season quarter. Overstaffing, anyone?
The union members make more than twice minimum-wage for a job that would be paid minimum anywhere else. They're striking because they're upset that they can't be guaranteed a minimum number of hours a week - even during slow periods. And they won't negotiate, preferring petty acts of vandalism and thuggery.
The government could still tax the hell out of liquor if it were so inclined. Just get out of the business of actually selling the stuff. Privatize it, give us more efficiency and better selection, and something tells me that the government's revenues would actually increase.
Yeah, the SAQ, Segacs! Where the english language is an obscenity, and where the friendly, smiling staff greet you with a blunt and SOBER "What-the-fuck-do-you-want-asshole" attitude! A rigid doctinare state monopoly with a publicity campaign based on the motto (and I'm not joking!) "it's a pleasure to choose".
Think of those old GUMM department stores in Moscow!
I don't see any problem with the existing distribution system for liquor and beer in Ontario. I can get what I want, when I want. Beer is $24 /case and liquor is $20 /bottle. This seems a fair price when you compare what you pay for it at establishments.
Here's a couple of things that bother me about privatization. First off, the recycling system in place for beer in Ontario is the most efficent environmental measure I've ever come across. Your empty cases get palletized and sent back to the brewer where they wash them and fill them up again. Everyone involved benefits, the brewery gets cheap glass, the consumer doesn't have to do much extra since they have a financial incentive and they're going to be at the Beer Store anyway. If you dilute the system, the Beer Store would lose it's market share but still be expected to handle returns. The breweries who own it would then be forced, by their shareholders, to pass the incresed cost of recycling on to consumers. So unless the corner stores selling beer will take returns, the recycling system will be needlessly hampered.
Enough about beer stores, on to liquor. Privatizing this industry makes so little sense it boggles my mind. Liquor is cheap and readily available, I repeat, cheap and readily available. It is also served responsibly, i.e. not to underagers and not to people who are drunk. You can walk into an LCBO and ask for recommendations for wine with dinner and get a knowledgeable response. In doing this, the government has finally found a business that it can run profitably. Now the government wants to sell off these future earnings for a one time sum. This is as dumb as the US lottery provisions where the financially inept can cash out their $10 million jackpot paid over 20 years for $200,000 cash in hand. I'm going to have to pay taxes for the next several decades, so I'd like that yearly, inflation and economy neutral, revenue to remain to take that burden off of me rather than distribute it to corner store owners.
Having lived for years in both Ontario and Alberta (and I'd love to hear from anyone else who's in the same boat), I stand categorically behind the latter's system; better choice, more stores, more hours. Consider this: Who in Alberta wants to go back to the old ways, besides a few government-union deadenders?
Posted at 2005-01-31 12:16:25 [PermaLink]Ahhh, Dara, it's all about you, isn't it?
Where's mine?
you're not from Chicago, are you?
Econ 101 - the store owners can hire more people.
What kind of taxes and fees do the store owners pay to start and keep their businesses?
Sandy, yes it is.
BTW, Dara has never tried to buy a decent red wine at an upscale LCBO outlet in TO. (I have.) Even corner wine shops in NYC have better selections. For a lark, check a mainstream shop like Sherry-Lehmann. It's like wine heaven!!
"wine heaven" that's redundant, Ran. Besides this IS 'Whine heaven'...
Posted at 2005-01-31 14:21:28 [PermaLink]No Sandy, I'm not from Chicago, I'm from Ontario. Since I'm from, and pay taxes in, Ontario, the Ontario government works for me. So yes, this about me, an Ontario resident, and the money which I hand over to my government.
Yes you could hire more people if you distributed the distibution, so to speak. They would be paid less and have less responsibility to serve in accordance to the law since their employer is profit driven. That's Econ 102, where business owners do what they can to make money. For corollary coursework see Nortel, Enron, and every other company that broke accounting rules for the love of money. Selling 6 packs to minors leaves less of a paper trail and I don't feel like employing police to check up on the hundreds of distributors that would pop up under deregulation. Nor do I think that buying booze underage should be made as simple as buying cigarettes underage.
As for selection, I decided to have a look at the link you provided Ran. It only had 2 ice wines listed. Why I could walk down to my corner LCBO and pick from amongst at least 8 varieties. If I went to a Vintages store, where they will order you bottles from a large catalogue of world wines, you would be sure to find at least a dozen varieties on the shelf and you would be able to order in one of the 244 varieties available to LCBO customers with no additonal charges. A perfunctory search for reds revealed that I have access to 6105 different bottles. Damn, I hope someday someone offers me some variety.
Dara: Down here in the states it's illegal for someone to sell liquor to a minor or someone who's visibly intoxicated (or at least it is in every state whose laws I know, both those with and without a state liquor monopoly).
I find it difficult to believe that the rate of illegal sales is going to change because the "owner" of the establishment is the Provincial government's liquor board rather than an individual owner or corporation. (Especially since a privatisation scheme would presumeably change the penalty for selling illegally from "lose your job with the state liquor monopoly and get fined" to "get charged with a crime and get fined", or another appropriate set of disincentives.)
(The government can run ANY business profitably if it makes competition illegal, you know.)
(PS. My only experience with Canadian liquor monopolies is with the BC system, which still keeps the beer more expensive than in the 'states. Is the LCBO similar?)
Dara:the government has finally found a business that it can run profitablyIt does this by keeping prices artificially high and maintaining its monopoly by law. If it were a private enterprise, it would have been clobbered by anti-trust laws years ago.Privatizing this industry makes so little sense it boggles my mind.What boggles my mind is that the Tories are the ones who refused to privatize it, ran screaming from privatizing Ontario Hydro, and put price controls on electricity, while the Liberals removed price controls and may sell the LCBO.
I guess it's true that only Nixon can go to China.
According to the man who wrote the book on public finance in Alberta, literally, Bev Dhalby, privatisation has been a mixed bag:
-Stores: Trebled
-Crime Per Store: Increased
-Selection: Increased
-Selection Per Store: Halved
-Price: More or less constant based on a fixed basket, but if more people are buying subsitutes and you say a beer's a beer's a beer, you could claim that prices have dropped, but you'd be disingenuous
-Wages: Down by 2/3rds
Good to know how highly you think of ensuring that people have an incentive to get off the dole that you'd applaud a policy that did worse than halve one of the deadliest jobs in Canada while depriving the people of Alberta of revenue.