Liquor privatization seems a solution in search of problem
Oregon has been in the retail liquor business for 80 years — operations likely jeopardized by an upcoming initiative vote.
While there is plenty to nitpick about Oregon’s system of handling distilled spirits, the proposal to privatize liquor sales and distribution seems like a solution in search of a problem.
A vote to end Oregon’s control over liquor is all but guaranteed, as the Northwest Grocery Association is expected to qualify one of five similar initiatives it submitted for the November 2014 ballot.
Before voters get a chance to weigh in, the Oregon Liquor Control Commission will attempt to modernize itself in a hurry, trying to get in front of any initiative vote that would disband its monopoly on liquor sales in the state. The OLCC is expected to introduce legislation allowing grocers to sell distilled spirits while keeping the state’s wholesale and distribution system intact.
Disbanding OLCC’s reign would be done in the name of consumer convenience, proponents argue, and the belief that Oregon’s system is an outdated relic of Prohibition times.
Opponents argue giving control to corporate grocers would squeeze out the mom-and-pop shops and create more challenges for the state’s growing micro-distillery industry.
In Washington, state voters opted in 2011 to privatize its liquor industry, with mixed results. Prices skyrocketed because of new state taxes, and the state has actually received more money from liquor sales. Arrests and collisions related to driving under the influence were down last year, but shoplifting of spirits by organized crime rings has become an issue.
To the south, California’s unrestricted market has led to cheaper liquor prices.
Ken Skinner, contract agent for McMinnville’s lone liquor store, one of 242 retail outlets in the state, told the News-Register he could “compete with the big boys” if the liquor market does become unrestricted. He said, however, he doesn’t expect the privatization movement to win.
We will hear convincing cases from both sides of this debate. But there doesn’t seem to be enough wrong with the current system to implement wholesale changes, especially without knowing exactly what the fallout would be. The current system may be slightly inconvenient, perhaps even more expensive for consumers, but that actually is fine by us.
Either way, we recommend careful study of any privatization law sent to voters. Privatizing liquor based on theory alone could become a major loss for Oregon.