CT News Junkie | OP-ED | Malloy’s Quixotic Quest For Liquor Justice

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OP-ED | Malloy’s Quixotic Quest For Liquor Justice

by | Feb 19, 2015 3:53pm
() Comments | Commenting has expired
Posted to: Business, Opinion, State Capitol

I may not be Gov. Dan Malloy’s biggest fan, but every time he tilts at windmills in an effort to reform the state’s outrageous liquor laws, I want to hug that little porcupine.

For the uninitiated, Connecticut has the most oppressive and anti-competitive laws governing the sale and distribution of alcohol in the country. It punishes the consumer in the name of protecting an entire class of retailers from meaningful competition. If any other retailer in the state enjoys these kinds of protections from pricing competition, I’m not aware of it.

Despite predictions of the apocalypse, the Connecticut Package Store Association and its chief henchman, Carroll Hughes, failed to stave off the passage of a law in 2012 allowing Sunday openings. Malloy also wanted to eliminate so-called above-cost minimum pricing for each bottle of wine and liquor sold.

Of course, the mom-and-pop package store owners love minimum pricing because the system doesn’t require them to compete with one another. Consumers, however, are getting ripped off.

The loudmouths on the comment threads complain that Malloy’s real intention is to stimulate sales to generate more revenue to pay more state employees and grow the government, as every Democrat likes to do. And they point to the fact that Sunday sales have generated little extra sales volume.

I can’t read Malloy’s mind, but even if his motive is to get his greedy hands on more of my money, then I don’t really care. You see, even if the elimination of minimum pricing brings more money into the state treasury, I still come out ahead because I’ll pay 20 percent less for my wine when I buy in my home state.

Fortunately, I work in Massachusetts and can buy there, so Connecticut’s outrageous laws rarely affect me. Be that as it may, this is really a simple matter of fairness to consumers and freedom for the business community. And those who are opposed to the elimination of minimum pricing are either package store owners or people close to them who think they’ll get a raw deal if they have to compete against larger stores.

And they’re probably right that some smaller stores will go out of business if the the state-mandated price fixing ends. Hughes is predicting the sky will fall. In dire tones, Hughes warns that more than half the state’s 1,150 package stores would close if they had to compete with Total Wine, which opened a 35,000-square-foot superstore in Norwalk two years ago, but under existing laws will reach its maximum number of stores when it opens new outlets in Manchester and Milford.

But why should package store owners be protected from the big guys when your local hardware store has to compete with Home Depot, the corner drug store with CVS and the one-chair barber with the army of haircutters at the mall? The answer is the package stores should not be protected and any sane, disinterested observer should know it.

“People who don’t support this support Connecticut consumers being gouged,” Malloy said. “That’s what this is about, giving Connecticut consumers the lowest possible price.”

Package store owners and their apologists in the legislature have always tried to change the subject from minimum pricing to Connecticut’s liquor taxes relative to other nearby states such as Massachusetts. Yes, it’s true that the Bay State has no sales tax on alcohol and a lower excise tax than Connecticut.

But that doesn’t even begin to make up for the pricing chasm between us and neighboring states. The invocation of the tax difference by the package store owners and their lobbyists was nothing more than an attempt to distract attention away a price-fixing scheme that would be considered illegal in almost every other retail sector.

For obvious reasons, Malloy chose to go to WPLR-FM’s Chaz and AJ radio show to announce his policy push last week. He figured he would get a friendly reception at the wacky morning show. And he was right. The hosts gave him hugs and high-fives when he presented them with a six-pack of Connecticut-brewed craft beer.

So why go after the package store cartel when there are so many other problems facing the state? Yes, we’re staring at projected budget deficits in each of the next two years of $1.3 billion and $1.4 billion. We have enormous transportation challenges and education funding has reached a critical stage.

But Connecticut also is an extraordinarily expensive place in which to live and do business, in part because of absurd laws that protect certain classes of businesses at the expense of the rest of us. And the fact that a relative handful of business owners have a stranglehold on the legislature and can force us to pay 20 to 30 percent more than we need to for a product is an outrage that must be stopped. It’s enough to drive me to drink — and stroke my pet porcupine.

Contributing op-ed columnist Terry Cowgill lives in Lakeville, blogs at ctdevilsadvocate.com and is news editor of The Berkshire Record in Great Barrington, Mass. Follow him on Twitter @terrycowgill.

DISCLAIMER: The views, opinions, positions, or strategies expressed by the author are theirs alone, and do not necessarily reflect the views, opinions, or positions of CTNewsJunkie.com.

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(33) Archived Comments

posted by: art vandelay | February 19, 2015  7:09pm

art vandelay

I totally agree with the writers comments.  Problem is the Liquor Control Authority & the Package Store Owners Lobby have more power than the Governor and Legislature combined.

posted by: DrHunterSThompson | February 19, 2015  11:04pm

Terry! Agreed!

This is way way overdue.  I can’t tell you how fed up I am about getting ripped off by minimum pricing. I buy wine, lots of wine (a hearty red goes great on a cold winters night with a bit of homegrown) everytime I travel out of state. Not fair to me, not fare to the local packy, not phair to Connectict.

HST

posted by: Terry Cowgill | February 20, 2015  4:53pm

Terry Cowgill

HST, I buy my alcohol almost exclusively out of state (fortunately I live close enough to the border to do so). So my objection to the package store cartel isn’t borne out of self-interest.

I just hate crony capitalism and rent-seeking at the Capitol. It makes me sick, so I turn to alcohol bought out of state. :-)

posted by: Politijoe | February 20, 2015  8:42pm

Politijoe

Terry, I don’t usually agree with you but I’m pleased to say on this issue were in complete agreement. You summarized the draconian liquor laws and protected interests perfectly. This change is long overdue.

posted by: art vandelay | February 20, 2015  9:17pm

art vandelay

@Politijoe,
Even I agree with you on this issue.

posted by: SocialButterfly | February 21, 2015  10:57am

This is historic. It’s the first time I can agree with Politijoe.

posted by: Politijoe | February 22, 2015  8:14am

Politijoe

I’m equally as surprised we have agreement, but as I always say, even a broken clock gets it right twice a day. Maybe this gets our foot in the or to a broader discussion regarding moderate policy legislation and market equality and what that would look like. Our state liquor laws are a good illustration of where we fundamentally agree that no one segment or demographic should be provided advantages or protections at the expense of the greater good. I believe this same thinking can be applied to our federal tax legislation, healthcare and energy policies. Moderate policies that are fiscally sound and serve the greater good.

posted by: SocialButterfly | February 22, 2015  2:58pm

@Politijoe;  Let’s see if Malloy’s suggested liquor sales pitch goes into fruition before you “go overboard.” There are many package store owners who are already vehemently opposed to the plan.

posted by: art vandelay | February 22, 2015  4:56pm

art vandelay

If the state is looking to make some SERIOUS revenue, it has the power completely take over the industry.  It can easily establish stores like in New Hampshire and reap all the profits.  Yes I know it would put the “mom & pops” out of business, but it could make a serious impact on the deficit.

Knowing our illustrious legislature, they will find a way to spend it instead of reducing debt.

posted by: SocialButterfly | February 22, 2015  7:34pm

@art vandelay: Connecticut cannot compete with New Hampshire and other states unless we drastically cut liquor taxes to compete, which isn’t Malloy’s plan by a long-shot.

posted by: dano860 | February 23, 2015  7:31am

I don’t believe that it’s anyone’s intention to be in competition with N.H. or Mass. This will allow a slight margin of lifestyle improvement through savings for residents as it aims to at improving the economy that may, in conjunction with any other little benefits we can muster, provide a salient point for a business to locate in Connecticut. Of course his tax on those same businesses may chase more away before it can draw any.
They must look at the overall picture and ramifications of spotty pop-up laws that are not true stand alone capable policy.
Vet these things better, please!

posted by: CtGasGuy | February 23, 2015  1:26pm

Terry - I have read many of your articles and on this one you are dead wrong.

Just for the record, cigarettes have a state minimum selling price and it might be a coincidence but they also have a very large State and Federal Tax on them like liquor.

Many who though Home Depot, Wal Mart etc. were good for local neighborhoods, soon found out that once the small business owners who live and have serve local communities for years are gone, so are the cheap prices at those big box stores.

Terry you know what is going on all over the US trying to block big box from putting locals out of business.

Second, it is a proven fact that small business is the life blood of this country.  To protect that life blood should and must be paramount to economic revival for our State. 

I am in the Gasoline Retailer Business and Yes, we would like to sell beer and wine and that should be fixed because local liquor stores now sell items we sell rather than just liquor. Sunday sales has done nothing for the State or the liquor industry - another legislative failure.

NO one is being forced to pay anything - we all make choices - as you point out you live in Mass and get your liquor there.  What burns me up, is when our local legislators pass laws and then they break those laws by making purchased out of State that are illegal under current State law.

Terry your too smart - Let’s work on fixing the big issues instead of taking up valuable space and time with what you know is a waster.

If Carroll Hughes a big pain, Yep I have gone up against him many times, but he is just doing his job.  I may have issues with how he does it, but he does represent the liquor industry and they demand results. Let’s look at lowering the power levels of lobbyist to a job of setting up appointments for clients and clients doing all the talking to legislators.  I was forced to register as a lobbyist due to the amount of time I spent in Hartford.  What a joke.  We need to fix the important stuff and guys like you can really help bring these issue to light.  Don’t waste your time on the small stuff.

posted by: art vandelay | February 23, 2015  2:20pm

art vandelay

To me it does not matter if liquor is sold through mom & pops big boxes or ABC’s like Virginia & New Hampshire.  All I care about is liquor being sold in Connecticut at the same price it’s sold in Massachusetts and New Hampshire.  Too bad the two casinos wern’t able to sell liquor & cigarettes tax free with no minimum pricing, they’d have a gold mine.  I’ll bet the Liquor Control Authority had something to do with that.  The tribes are a sovereign nation.  They should be able to sell anything they so desire tax free.

posted by: CtGasGuy | February 23, 2015  3:16pm

We would all like things to cost exactly the same from one State to another, but the cost of doing business in Connecticut is much higher and minimum pricing is a very small portion of that.

If minimum pricing goes away, I would bet you taxes go up, not the exact amount of the minimum pricing but very close.  You need to care about the business owners who serve you the customer and stop being so naïve that it is all the greedy small business owners.

posted by: art vandelay | February 23, 2015  4:16pm

art vandelay

I detest cartels being protected by unfair business practices be they package stores or car dealers at the expense of the consumer.

posted by: SocialButterfly | February 23, 2015  4:48pm

Connecticut is already being paid off by he tribes handsomely, and their selling liquor and cigarettes at reduced prices would jeopardize that arrangement. It won’t happen.

posted by: art vandelay | February 23, 2015  8:46pm

art vandelay

@SocialButterfly,
If memory serves me correct, the pact orchestrated by the Tribes & Governor Weicker was strictly slot revenue. The Tribes were allowed a monopoly in exchange for 25% of the revenue generated.  It said nothing about liquor or cigarettes sales.  Maybe it’s time for the tribes to test the waters.

posted by: Politijoe | February 23, 2015  9:07pm

Politijoe

Ct Gas Guy does provide a valid point on this issue. Although minimum pricing doesnt directly benefit competition in consumer pricing it does help to sustain a thriving small business environment. Once the big box retailers gain substantial market share utilizing volume pricing the small mom and pops can’t compete and the big box retailers ultimately increase their prices. With the current minimum pricing retailers compete on the wholesale end and that ability to control wholesale costs is sometimes reflected in the retail price at minimum plus.

posted by: art vandelay | February 23, 2015  11:03pm

art vandelay

@Politijoe,
I’m sorry.  What minimum pricing does is protect one industry.  That’s wrong.  Did the government protect Caldor’s & Bradlee’s against Wal-Mart?  NO!  Why should government protect mom & pop package stores at the expense of the consumer.  It shouldn’t.  Let’s level the playing field in the favor of the consumer.

posted by: SocialButterfly | February 24, 2015  9:27am

@art vandelay:  Because there was no provision for liquor or cigarette sales between the tribes and the state in the original contract agreements, new contracts would have to be written to provide for this option, which would void the original agreements, but I don’t think anyone wants to void their original contracts at this stage of a poor economic environment.

posted by: CtGasGuy | February 24, 2015  10:29am

Art Vandelay- its called learning from your mistakes.  Because something did not happen in the past does not mean we should not do it now.

Again, you are just moaning about an issue that bugs you but not addressing the real problem - high unfair taxes.  While you have ever right to spout off, try to come up with solutions other wise your just another person crying but no solutions are offered.

posted by: art vandelay | February 24, 2015  10:41am

art vandelay

Our economy survived when Caldor’s, Bradlee’s & Ames, closed their doors.  It will do the same if mom & pop liquor stores close too.

posted by: CtGasGuy | February 24, 2015  11:43am

Survive is not the issue - one could argue much better times then now back then so are we really better off today then the past.

I think most will disagree with you. If your answer is keep closing up the small business owners all across this great country of our, then your position is clear and I am so glad I do not agree with you.

posted by: SocialButterfly | February 24, 2015  12:22pm

@CtGasGuy: Our solutions are to cut spending and continued increased taxation, but our problem is that we are electing the wrong politicians oriented on Democratic deficit prosperity that is burying our state and country.  We have a real problem with the low quality of our voters, many of whom have been bought off by Obama benefits paid for by our massive, bankruptcy-drive federal deficit.

posted by: Politijoe | February 24, 2015  1:51pm

Politijoe

Art: The fundamental issue is the same regardless whether were discussing healthcare, taxation, wealth, unions, education, military, Wall street or Main street. The question is what kind of society do you want to live in ?

posted by: art vandelay | February 24, 2015  4:29pm

art vandelay

@Politijoe,
Not a society in which you would like us all to live in.

posted by: SocialButterfly | February 24, 2015  5:21pm

@Politijoe:  You answer a question with another question which offers no solution, other than keeping in touch with Art.

posted by: Politijoe | February 25, 2015  10:10am

Politijoe

Socialbutterfly: I apologize if you feel left you out of the conversation, however when I stated that regardless of the subject: healthcare, military, taxation, wealth, unions, education, Wall street or Main street. The fundamental question remains…”what kind of society do you want to live in?” in typical fashion you both respond with nonsensical answers. The reality is that almost every important issue from the individual mandate and immigration amnesty to unions and environmental legislation requires a massive rewriting of history from what conservatives once stood for just a couple of decades ago to what they vehemently oppose today. I’m hard pressed to find a Conservative who doesn’t oppose healthcare reform in spite of the insurance industries long history of denying treatment and the fact our national healthcare costs are the highest in the industrialized world. Similarly is their strong opposition to banking regulations, in spite of rampant consumer credit abuses and Wall Street practices that led to a global economic collapse with no accountability and enormous profits reaped at the expense of American taxpayers. Conservatives claim to support a stronger middle class economy but oppose modest tax increases for the wealthiest and living wage increases for the working poor. They demand spending reductions to social programs but oppose cuts to a military budget that is higher than the next seventeen nations combined. And even the stalwart of conservatism, the support of small business, appears malleable and suitable for sacrifice for the endless pursuit of wealth and corporate profit. Conservative voters who remain silent to these types of abstract notions, inconsistencies, contradictions and misinformation are complicit in the exploitation of their own fears of social progress. Therefore, the simple question remains what sort of country do you want? Based on your responses and the incarnation of the modern conservative party it appears conservatives have set their sights on a Dickensian society and you think it looks pretty good. I guess Eisenhower, JFK, FDR and Martin Luther King had their dreams and you have yours…. separate and extremely unequal.

posted by: SocialButterfly | February 25, 2015  7:37pm

@Politijoe: You attack the conervatives, the rich, corporate business and millionaires in the same fashion that Barack Obama does in promoting his liberal, slanted press releases paid for by the U.S.taxpayer. I can never agree with you as I do not believe in the failed policies of Obamaism that you appear to accept as your political gospel.

posted by: Politijoe | February 25, 2015  9:25pm

Politijoe

socialbutterfly: your statement “I can never agree with you as I do not believe in the failed policies of Obamaism that you appear to accept as your political gospel.”..... unfortunately, this says absolutely nothing. It’s empty rhetoric that doesn’t begin to articulate anything about your positions or data which might support your conclusions. Furthermore, not surprisingly you didn’t address a single point regarding the conservative contradictions I highlighted. I don’t believe its in anyones interest, certainly not mine to continue to engage you with any expectation of rational dialog. I find the experience of presenting facts to you much like trying to feed a dog a pill….. you can wrap it in bologna, force it down his throat, and just when you think he swallowed it he spits it back out on the floor. Your incomplete thinking is simply too predictable and sophomoric to take seriously. For what its worth, do some homework, get some facts and if your interested in an informed conversation i’ll be interested.

posted by: SocialButterfly | February 26, 2015  11:18am

@Politijoe: The homework that you brag about has only reflected in your skewed interpretation of a failed achievement outlook based on the failures of the policies of Pres. Barack Obama that have been adopted by Gov. Dannel Malloy, which are the reasons for our national and state fiscal demise. You fail to supply any facts to back up your support of our failed Democratic-led leadership as you have evidently been brought up “to be as stubborn as a donkey” and therefore continue to be steadfast in your way.

posted by: Politijoe | February 26, 2015  4:39pm

Politijoe

Socialbutterfly: Against my better judgement I’m going to allow myself one last opportunity to engage you in a rational dialog.
You stated that the information I’ve provided is merely a skewed interpretation based on the failures
of the Obama policies. Unfortunately this is empty rhetoric, for instance WHAT are the predominant Obama policies that you are referring to?  How do you support the definition of “failed” ?

More importantly, when I highlighted the conservative contradictions that reflect most of the important issues of the day, from Wall street to Main Street you predictably side-stepped that critical and central point and responded with an indirect, unarticulated shallow response regarding my lack of facts. The reality is the facts are self-evident- either the contradictions exist or they do not.

Having said that, please refrain from further sophomoric, dead-end responses and share substantial thoughts on the issues presented. Otherwise, I for one simply cannot continue to engage you in any future dialog that is intellectually lazy and circular in nature.

posted by: SocialButterfly | February 27, 2015  9:44am

@Politijoe: Your last attempt at a rational dialogue appears to be a plsy of words, but no concrete facts.  You say “The reality of the facts are self evident, either the exist or they do not?”
If you like the way that Obama is running this country, or Malloy is manipulating this state, that’s your choice.  The massive tri-trillion-dollar deficit spending power of Obama, followed by a copy-cat deficit spending of Malloy can’t be excused by your factless dialogue.
this only proves that “the blind are comfortable with being led by the blind.”