Free markets are often times the best policy. But so far (and yes, it’s early days) with liquor privatization, prices have gone up. Now if you think that markets are inherently good philosophically in all cases (or in this case) then the prices being up may be fine. And in the long run, maybe they start high but eventually go down or in the long run they won’t go up as much as if the state controlled distribution.
But I think if you’d told people a bottle of Jameson will go up couple bucks, and that’s generally true the initiative would have a lot less support. I mean whenever I was in Costco during the signature gathering and the campaign there were signs saying how much cheaper alcohol was in California. And attributing all of that to market forces over the big bad state government.
But market forces haven’t worked that way, at least not yet. And so while Costco will probably make a profit, the people who supported it at the ballot box may rightly be upset that they didn’t get the result they wanted. It may feel like more freedom to ideologues and people who make a greater profit. But for people who pay more, it’s just paying more.
We were told capitalism would bring down prices, and so far capitalism failed at that. I hope the next time we have a discussion of how to have markets in Washington, the proponents of more market solutions (and I may be one of them) will have the decency to use better logic than trust the market.
What used to be a transaction between you, the state, and the liquor companies is now a transaction between you, Costco, the state, and the liquor companies.
Capitalism doesn’t make money by passing it through more hands. It makes money by cutting those hands off. (The only time businesses introduce middlemen is for a liability shield.)
Watch for an initiative next year to drastically cut the state fees. They will also point out how cheap California prices are when collecting signatures.
And in this state that initiative will pass too.
Oh those pesky facts.
@1. That’s a nasty scenario. I hope it doesn’t come to pass.
And in this state that initiative will pass too.
Why? what’s wrong with our character that we feel we must get something for nothing?
The problem is the state has demanded a monopoly on the distributorships. Yes Costco cannot sell more that two cases to anyone let alone any business. When they are forced to open up to a nonmonopolized distributorship model, prices will subside, alss the insane taxes will be an issue in upcoming initiatives. There is no reason in hell the state should be getting 1/3 of the cost of a bottle of hootch
@1 Your prediction is 100% correct.
@3 Have you not been paying attention?
@4 Where else are necessary revenues (police, infrastructure, schools) going to come from?
We’ve now got liquor stores on every street corner. Next comes cheap liquor. After that, a lot more of these …
http://www.car-accidents.com/d.....dents.html
The bright side for employment is that liquor privatization will create jobs for a new generation of lawyers, insurance adjusters, and undertakers.
I supported this initiative even with the expectation that prices could go up. Not necessarily a failure of capitalism, just the reality of having to put together an initiative that wouldn’t cost the state money. It’s the taxes established by the initiative that lead more to the higher cost.
The Seattle Times has certainly gained from this initiative’s passing. Check out all the liquor ads in the daily paper.
@8 “It’s the taxes established by the initiative that lead more to the higher cost.”
How do you figure that, Lee? The taxes are the same as when state stores sold liquor. So how can you blame taxes for higher prices? Something else has to have gone up: Distribution costs, retail overhead, or retailer’s profit. The latter is the prime suspect. After all, Costco has to get its $20 million back. Did anyone think Costco would eat its initiative expenses? Like every other business expense, that gets passed through to customers.
Well, liquor was expensive before, and now that it’s more expensive, maybe that will offset easier availability to keep excessive drinking in check.
THe Higher prices are intentional payback by the state who didn’t want to give up the precious monopoly that they never should have been involved with to begin with. The state should not be running businesses competing with the private sector, they will always lose, because the private sector can do them just as well and cheaper.
@12 “THe Higher prices are intentional payback by the state …”
I didn’t realize the state is telling Costco, Safeway, and QFC what they have to charge. Thx for the heads up.
@12 Government usually gets stuck with jobs the private sector won’t do because there’s no profit in them, such as providing ferry service across Puget Sound, paved roads in counties where the population density is 3 people per square mile, rural mail service, subsidized irrigation water to farmers, free parks and libraries, etc.
@12 Not only does the state not set the retail prices, but in this case the state legislature didn’t set the tax rates. The initiative itself altered the liquor taxes, which means the voters did it directly. The mindless assumption by folks like you that “gub’ment is out ta git ya” is directly responsible for government being less able to do things — even things that most everyone agrees it should do — efficiently and effectively.
@12 You do know that even FedEx and UPS use the Postal Service to deliver packages to the hinterlands. If those private companies can do it better and cheaper, why are they not competing in rural package delivery?
16. And the Postal System is ? How Bankrupt? Last year Billions in the hole and they are closing facilities all over America
15.
They never should be in a retail business of any type, because government was not put in place to compete with private business, as they will always lose because their overhead is too expensive. Case in point. I rode a ferry and walked into one of the tiny food stops on board, and their was a help wanted sign. State employee, Holidays, vacation, retirement, $17 an hour, free meals, child care and mileage to name a few. This type job is what I did when I was 17, for 4 bucks and hour and a meal if I was lucky.
No question on that one at all.
2.
17. The Post Office is having money troubles because Republicans in Congress forced it to fund its pension system for –75 years– in advance. The PO is not failing, it’s being deliberately murdered.
We as gluttens are whatching thee implossion of the democrat party and all that is attatched to it, unions, service personel and news cradentials…..sad really. I would like to honor Scott Walker in saying this Madison Mother will (This time around) be voting for Rational!!! A vote for Walker is a Vote for our States credabilty and our childs Future. We have to face the music whether we dance to it or not….Election Mr. Scott Walker is the Right Choice for me as a new middle of the road political travler. Elect Scott Walker Please!!!
The state should not be running businesses competing with the private sector, they will always lose, because the private sector can do them just as well and cheaper.
Where is the private sector version of DSHS? Where’s the profit margin in that?
Did you even bother to read the article??
It says the difference is all the new TAXES.
To blame taxpayers for a costly, bloated, money gouging State Government is laughable.
Read the article.
Oh and Nancy..AMEN to that. Wisconsin will turn the tide against the Obama Regime today
@21–
Profit margin?? It’s about efficiency. DSHS is a Union Dumping ground for incompetence. Look at the record. There is so much bureaucracy that produces absolutely nothing for taxpayers.
How tax man Batman!
Seems #22 is spot on!
Am I the only one who doesnt care if the prices go up? The price is irrelevant. The fact of the matter is that the state has no business selling booze.
If you all want the state to sell booze, then why not snickers bars, soap, and lettuce too? Hell, lets have the state sell everything!
You fools totally miss the point.
Leave it to No Time For Communists to compare dshs to retail sales…
Fail.
All you anti-government types are forgetting one thing. Several actually.
1) The State Liquor Control Board was a leftover from ending prohibition. Establishing the Board was the only way to convince the Conservatives in this State to agree to ratifying the 21st Amendment. It was the Conservatives that wanted to preserve alcohol prohibition.
2) The taxes levied by this bill ending the State monopoly on alcohol sales were printed and passed by the Initiative. All that has changed is now there are several layers of middlemen to deal with; wholesalers, warehouses, trucking and distribution. The prices are now set by the free market.
3) Thus far, the State has had it’s ability to raise necessary revenue to maintain itself drastically reduced. Programs that are absolutely essential to maintain our basic civilization have been cut to the bone, and in the case of our public schools, even deeper. We are now seeing real structural damage to the schools being done by the reductions in their budgets. It is the obligation of the State to fully fund schools under the State Constitution. So the Conservatives try to shift the focus onto private schools, run by Corporations. What that creates is another group of middlemen that are going to chisel off as much as they can while minimizing services they are contracted for. The same goes for Prisons.
Conservatives, knowing the price of everything, and the value of nothing. It isn’t about reducing costs, it’s about reducing law enforcement.
Am I the only one who doesnt care if the prices go up? The price is irrelevant. The fact of the matter is that the state has no business selling booze.
I actually agree with him, however I want the taxes KEPT on the booze. Services cost money!
@10
How do you figure that, Lee? The taxes are the same as when state stores sold liquor.
No, they’re not. This is just wrong.
@10
http://seattletimes.nwsource.c.....cmpid=2628
The new law imposes 27 percent in fees on wholesalers and retailers to compensate the state for closing its lucrative liquor business. (While the wholesalers’ fee drops to 5 percent from 10 percent in 2014, the retailers’ fee stays at 17 percent.)
One little positive note in all this…
There was some concern expressed that the big change would result in retailers concentrating on moving lots of 1.75 liter bottles of cheap vodka and our fledgeling industry of local craft distilleries would be left to wither and die. So far, it’s been the opposite–I dropped by the Sand Point Met Market on Sunday and saw there were two rows in the “spirts” shelves for bottles of Woodinville Whiskey–empty. The wine-and-liquor manager happened to be standing nearby and I asked him about that. He said they’d sold the last bottle they had around 10:00 in the morning. They called the distillery and learned that aside from a little held back for “family and friends”, they were completely sold out and wouldn’t be shipping any more until the next batch finishes aging.
Wouldn’t it be nice if more small businesses had that kind of “problem” to deal with?
@31 Metro Market (thankfully) is carrying local craft distilleries on purpose, hoping to find a niche.
– – – –
Rural areas will see less competition, and therefore higher prices and less selection. As usual, they were subsidized by the cities without appreciating it. Now they can deal with the (not so) free market.
yd,
“And the Postal System is ?”
Do you hate America as much as you hate the Constitution?
Do you believe in magic … ?
I’m old enough to remember when the majority of citizens, shoppers and voters had intelligence.
First off, despite being “early” prices are not higher for spirits. You’re getting more. All that convenience!
Second [@30], that fee is not an additional “tax” it’s the cost of entering the business.
Third, all of this was in the privately [not state government sponsored or legislated] crafted and voter approved initiative.
And as an aside, you gotta love the way that Costco played it. Manufacturing Consent!!
Fourth, [and this is why direct democracy has always been a poor way to legislate] demand for liquor ain’t like demand for “widgets”. It’s called price elasticity and liquor don’t got it. That’s why “criminals” quickly got in and made a fortune during prohibition. There’s not ever going to be a price war for your liquor dollar. Sure, there’ll be bargains from time to time, but there were bargains and sales when the evil marxist-soshulist state of Washington ran it too.
Now, if you live in urban WA you’ll have the ability to purchase bottom shelf liquor at a lower price from near-by Costco, Walmart and other big box retailers. You’ll even have a fair shot at finding the good stuff nearby at a competitive price. But, like phil @32 said, if you live in rural WA (you know, the place where they like to vote for the GOP) the cost of your liquor is going up. You’re either going to pay out the ass or drive your car consuming $4+/gallon gas to save a couple of bucks.
Costco ain’t a f*cking charity people. The next time you go to vote for/against a privately funded business sponsored initiative, if you can’t spot the sucker in that proposal, then you ARE the sucker.
Full disclosure: Large shareholder of Costco stock.
A buddy of mine in Olympia say his whisky of choice double in price overnight. And as long as we’re on this point…..
I’m in Nevada right now, anyone who wants me to get liquor for them cheap can follow the link to my blog and email me, and we can discuss terms. I’ll be heading back to western Washington on the 17th, so act now!
Everything I said was going to happen has happened.
The taxes were kept high by I-1183 so the initiative would PASS. (Bellingham Herald got it right.) They didn’t have to say the price would go down because the ideology is so thick in the air right now they didn’t have to. EVERYBODY though they’d go down. And now we’re sooooo confused! That’s why you have people clogging the liquor aisles in safeway right now like schools of stunned carp.
The prices are high because you took a no-tiered system with maximum economy of scale and split it up 17 ways (not to mention taking a finite retail market shared by 360 outlets which is now split up by 1400 outlets) and you expect to contain all that cost in the 30% of the old prices that made up cost? Can wingnuts just not do math?
Blaming Costco is just too damn convenient. The fact is we have too damn many people rendered idiotic by ideology.
I just solved the whole dang problem
http://www.morewines.com
Click on Spirits, search for your favorite hard liquor and SCREW this state.
Cheaper even with shipping, and here in 2 days
I love the internet, it solves idiot politician’s greedy fists
37 – I thought the initiative solved all the “problems” birfer boy.. Guess you were wrong..
As you are about everything else.
@37 typical, yet another teabagger who doesn’t want to pay his fair share of his taxes.
Fair Share…Now that is funny! 51% of america are now on the giverment dole. Sounds Like Russia!
Err, if you’re talking about the Republican talking point about Income Tax and ‘broadening the base’, not paying income tax does not translate into being on welfare or unemployment or other forms of ‘the dole’. It just means the available credits (you know, ‘tax cuts’) cancel out their liability because THEY MAKE SO LITTLE.
The right wingers argued that opening up the electricity market in California to competition would lead to lower prices. Instead Aunt Millie got raped by Enron and we had the west coast power crisis. Luckily the state legislature exempted municipally owned utilities from the law. LA Department of Water & Power kept the lights on and the prices down while the rest of the state was falling apart. Yet as we have seen in this liquor initiative, this private enterprise is better than state run companies (or regulated monopolies) keeps getting made without any serious argument about its merits.
@37, screwing Washington State is what motivates you.
The comments are interesting
http://www.getrichslowly.org/b.....omethings/
@27,
It was the Progressives who wanted Prohibitionin the first place. The Progressives of the day teamed-up with the Women’s Christian Temperance Movement and other anti-alcohol loonies to get Prohibition passed.
Prohibition was doomed from the start. Americans came from a drinking culture, so there was no way they were going to stop having a drink when they felt like it.
The funny thing about the end of Prohibition was that it was harder to get a drink after Prohibition ended than during Prohibition itself. Even Ken Burns recognized and acknowledged this in this documentary on Prohibition.
Today, we have the prohibition against cannabis, which is just as loony and un-workable as the prohibition againat alcohol. When are were ever going to develop some common sense and realize that, sometimes, people enjoy using drugs, be those drugs alcohol or cannabis?
43 – Yes Screwing washington state is what motivates me, and I do it on everthing I buy. I pay little to no sales tax on anything.
@36 Paddy
Just for giggles, I’d love to see some examples of where privatization lowered costs to consumers.
@17 yd re: bankrupt USPS
Citation please.
@4 yd
So what you’re saying is that The State forced Costco to underwrite an initiative and then forced everyone to vote for it?
@27 Deathfrogg
Methinks that number is significantly higher than one.