Wednesday, January 28, 2009

Full strength beer sales in grocery stores

On occasion, there are bills that come up which represent a clear choice between right and wrong, good and evil.

This is not one of those cases. Tweaking the State’s liquor laws is really just a fight in the Capitol for market share on Main Street. The existing system is convoluted to be sure, and with the exception of last year’s bill to allow sales of alcohol on Sunday by liquor stores, very stable.

While this isn’t a clear case of right vs. wrong, I do think that the argument does represent a case where one side is marginally more right than the other. In this case I place the value on the scale of right and wrong at 65 to 35 in favor of the liquor stores over the convenience stores and grocery stores.

To fully understand the issue, you need to understand some background information.

Under current law, grocery stores and convenience stores can only sell beer and some other drinks where the alcohol content is 3.2% by volume or less. This has been the case for many decades. Until last year, they had an absolute monopoly on alcohol sales for carryout on Sundays. Of course, they can also sell all kinds of other items including gasoline – just envision a Super Wal-Mart and you get the picture.

Liquor stores operate under a completely different set of rules. An individual, and no corporation, can get a liquor license to sell in only one location. That’s why you don’t see chain liquor stores in Colorado. The only way around that is where you see a couple where one person has a license to sell for one location and the other in another location. You occasionally see a grocery store with a full liquor license; they can obtain that license if they have a pharmacy in store and get a combo pharmacy/liquor license.

Are you confused yet?

There are plenty of examples of smart people working their way around this problem of licensing.

I guess it is an example of what you get when you allow government to write the rules and interfere with the market down the minutia of who can sell what. This is proof that socialism is a bad idea.

But here is the kicker:

Real people risked their hard earned money and time to start a business under a given set of rules established by the government.

If the government changes those rules and that change eliminates the investment of those real people, government would be making a mistake.

To be fair to the convenience store and grocery store owners, last year’s change to allow Sunday sales of all liquor in liquor stores did hurt their business in a trade off for convenience for consumers. No one can ignore that, but it pales in comparison to the damage that would be done to liquor stores by the change to allow sales in 7-11 and Safeway. That’s why I place the balance of the scales at 65-35.

Dang it, it is hard to unwind socialism, which is why we should resist any other move in that direction.

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