Current Liquor Privatization Plan Unworthy

Current Liquor Privatization Plan Unworthy

“I don’t know…he’s either very smart or very dumb.”

– Quint, in ‘Jaws,’ trying to figure out the shark.

famous line perfectly sums up both Gov. Tom Corbett and the
Republican-controlled House as they push their liquor privatization
bill. They’re either very smart, trying to pull a fast one on
Pennsylvanians who expect better selection and lower prices (which they
know cannot happen with this bill). Or they’re very dumb, actually
believing the bill they’re peddling will actually accomplish those

Here’s betting on the latter.

No offense to Chris Christie, but anytime Jersey can do something better, you know you have problems.

clearly, buying wine and liquor is better there. Of course, that’s not
saying much, as 48 states have markedly better ways to buy liquor and
beer than Pennsylvania. Only Mormon-heavy Utah is also state-controlled.
Gee, what great company.

So huge numbers of Pennsylvanians
continue to stock up in other states, especially tax-free Delaware, to
the detriment of state coffers.

The fact that Corbett and the
House Republicans think that situation will change with the current bill
(which passed the House on Party lines) makes you wonder if they were
drunk while crafting such bad legislation.

Let’s review:

Despite being overwhelmingly
elected in 2010, in large part by promising to privatize liquor, Tom
Corbett did nothing in his first two years. Actually, that’s not true.
His big foray into that issue was commissioning yet another blue-ribbon
panel to – ready for this? – study liquor privatization.

Just thinking about that gives you a hangover.

now that they are officially on board with privatization – which is the
right thing to do – they vomit a bill that will neither increase
selection, nor, most significantly, reduce prices.

Only in Pennsylvania.

bill is a non-starter, and should it pass the Senate in its current
form – far from certain, since Majority Leader Dominic Pileggi, R-9, of
Chester,  is lukewarm and the GOP lost 10 percent of its seats in the
last election – the people will be vastly disappointed upon realizing
that prices will be the same, or even higher.

Here’s why:

whopping 18 percent Johnstown Flood tax (established to rebuild that
city after its 1936 flood) remains in place, on top of which is the
state sales tax. End of story for lower prices.

Being hamstrung
by such an onerous tax gives the wholesalers and retailers absolutely no
wiggle room, forcing them to keep prices substantially higher than
stores in neighboring states.

There are only a few players in the
nation with the capital to buy in at the wholesale level, which will
cost tens of millions just to get a seat at the table. And that’s just
the beginning.

Funny thing about liquor – it’s bulky and very
heavy. Transporting it across 45,000 square miles will take one hell of
a lot of trucks and drivers, neither of which come cheaply. There
will be the need for huge warehousing space in multiple locations.
Personnel requirements will be substantial, and the costs associated
with distribution networks and other ancillary logistical issues will be
considerable. And last we checked, fuel costs were near record highs.

These companies are not in business
to break even or lose money. Translation: you won’t be buying liquor
any cheaper than you can today.

Making this bill even less than
gin-dandy are the pie-in-the-sky revenue projections related to
licensing. Beer distributors would be able to sell wine and liquor, but
for a substantially priced initial license fee (and subsequent
renewals). Great, except for three big problems:

1) Most beer
distributors are small, undercapitalized mom-and-pop operations. They
have a hard enough time making ends meet, so where exactly are they
coming up with the cash required for a license? With so many licenses
up for grabs, most banks will balk at loaning the necessary funds to
acquire a license, as it is will be seen as far too risky.

Assuming a distributor could get a license, the capital outlay would
jump again, as they would have to add considerably more square footage
to their existing stores, or lease/buy a much larger space altogether.
Wine and liquor take up a lot of space, and recession notwithstanding,
that space isn’t cheap.

3) Distributors know nothing about wine,
so, in order to compete, they would have to hire additional staff with
knowledge of vino.

One of two things will occur. Many
distributors can’t or won’t apply for licenses, and for those who do,
their prices will increase to make up for their additional costs. When
you add in the mandated Flood Tax, it becomes obvious that overall costs
have to rise, perhaps dramatically. Distributors would also have to
compensate for the loss of revenue associated with the widespread
availability of six-packs and the elimination of the
buy-beer-by-the-case law.

Granted, many politicians are
slow, but this one should be a no-brainer. Eliminate the 18 percent tax,
and you eliminate the need to cross the border and give other states
Pennsylvanian’s money.

Some will ask where the revenue shortfall
would be made up should the tax be rescinded. That’s easy. First, you
don’t keep a tax that is wrong just because you happen to rely on the
revenue it provides. You fix it. Second, that’s the Legislature’s job
every budget: decide how much money goes where. If there’s a shortfall,
other slices of the pie get smaller. Tighten the belt like families do.

important, there wouldn’t be a shortfall. If the incentive is taken
away to go to other states, untold millions – which would be “new
revenue” – would find their way into Pennsylvania because of the massive
volume in liquor sales that would occur. Remember, as it stands now,
the state is getting zero from the millions currently flowing to other

Corbett and the Republicans need to
put down the bottle and either rectify their error of pushing a bill
they think is good, or stop the political expediency of rushing a bill
they know is bad but can deceivingly trumpet as a success purely for
re-election purposes.

Do liquor privatization right, or not at all. And you don’t have to be blitzed to know that.


Current Liquor Privatization Plan Unworthy

Letter To Toomey

I sent this about an hour and a half ago to Sen. Toomey:

Dear Sen. Toomey

I’m sure you are getting a lot of grief for the proposal by Sen. Manchin and yourself to expand background checks for firearm purchases.

And you deserve it.

Still, I don’t hate you and you can continue to chalk me up as a supporter albeit with concerns that you are catching Potomac fever.

I do wish that you and other Republicans would stop playing defense and take the offense. How about you start making the case about the benefits of private firearm ownership. Our murder rate, for instance, is at a near low for my lifetime despite (because?) the number of states allowing concealed carry rose from 10 to 41 since 1980.

Philadelphia is a less dangerous city that it was in the ’80s & ’90s. Really. How about pointing things like that out?

Regarding mass school shootings it would also be nice if someone noted that  they didn’t occur — the first was the Grover Cleveland School shootings in 1979 that inspired the song “I Don’t Like Mondays — when the children started the day with a prayer and looked at the Golden Rule on classroom wall.

And, of course, when our society recognized that helpless life was something to be protected and not defined away for the sake of convenience.

I don’t think that is a coincidence.


Letter To Toomey


Letter To Toomey

Man Steals Obama’s Brain, Gets 7 Years

Man Steals Obama’s Brain, Gets 7 Years — Eric Brown, a career criminal from Richmond, Va.,  was given a seven-year sentence, yesterday, for stealing a truck containing President Obama’s brain.

“The theft of government property is a serious offense,” Assistant U.S. Attorney Roderick Young said, who outlined Brown’s “nightmarishly long” criminal record.

The truck had no White House markings, but inside it was
loaded with speakers, microphones, Obama’s brain, a laptop computer,
podiums and other items used in presidential appearances. The van was
empty when it was recovered on the other side of town the next day, and
some of the items were later recovered at Maryland pawn shops.

Authorities declined to speculate as to whether this was the reason for the President’s recent lengthy “vacation.”

Pundits note that stealing a brain from Vice President Biden would not be possible.

Man Steals Obama’s Brain, Gets 7 Years

Man Steals Obama's Brain, Gets 7 Years

Ex-Californians Like Texas

Ex-Californians Like Texas  — In the last five years, 150,000 Californians have moved to Texas.  Of course, a lot more Mexicans than that have moved to California some wag might note. Still, Texas has gained 400,000 jobs while California has lost 640,000, and the Lone Star State was responsible for 47 percent of national job growth.

By the way, Louisiana, which despite having had a conservative reputation was in the Democratic pocket at the state-level until Katrina, has since the hurricane and the ensuing fiscal conservative Republican — note the fiscal conservative part, Gov. Corbett — takeover has dropped from 47th to 13th in the Chief Executive rankings as to best states in which to do business.

For the record, Pennsylvania ranks 43rd on the list. Hey, look at the bright side: it beats New Jersey (45th) and New York (49th)

Hat tip Chuck Martini


Ex-Californians Like Texas


By William W. Lawrence Sr

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Answer to yesterday’s puzzle: Who is richer? The man who is seen, but cannot see? Or the man who is not being seen, but can see?
Babe Ruth

Toomey Gives Response On Gun Bill

James J. Fitzpatrick, the Southeast Pa. regional manager for Sen. Pat Toomey,  has sent the following response to Mary Ellen Jones of the Delaware County Patriots regarding proposed firearm background check legislation that Toomey and Joe Manchin (D-W. Va.) are supporting.

On the gun issue, first I think we have come a long way. When it started out they were talking about bans, registries, and magazine limits. When the back and forth debate is whether or not to slightly expand background checks I think it is a win either way with this President.

Second, on the background check issue. We were approached by Sen. Machin’s office to potentially broker a deal on certain private sales and transfers. Right now in PA if you wanted to sell me a handgun/pistol, I would need to go to a federally licensed dealer to receive a background check. If, however, you wanted to sell me a rifle, or any other type of long gun, I would not need to do that. We think there is a potential room for a deal in that space given that many gun owners already require individuals to whom they are selling long guns or rifles to go through a background check. I think Pat’s thinking on it is at the very least on these transactions, the check would reduce the likelihood that someone would be selling to a felon, someone with a past of substance abuse, or someone that has a past of mental illness. It would also in turn protect the seller from liability on the back end if anything were to happen with the gun they sold.

With that said, these are simply conversations at this point between Manchin and Pat. No bill has been written and one will not be on the floor until next week at the earliest.

Ed note: The above message was sent April 9. A vote to start debate on the measure passed cloture in the U.S. Senate the afternoon of April 11 by a 68-31 margin preventing a filibuster. The Toomey-Manchin amendment has yet to be added.

Toomey Gives Response On Gun Bill

Toomey Gives Response On Gun Bill

Delco Pats Hear Matt Brouillette

Matt Brouillette of Commonwealth Foundation gave an upbeat but realistic talk to the Delaware County Patriots, this evening, April 10 about solving Pennsylvania’s and the nation’s problems.

Brouillette said that it wasn’t a matter of Republicans versus Democrats but rather of David versus Goliath that was pushing us to fiscal disaster and poverty. Pennsylvania, he said, had a State House in which the GOP held the largest majority either party has had in decades and that the Republicans controlled the state Senate here by a greater margin than their counterparts in Texas.

Unlike in Texas, though, it is Goliath that rules. Many of the state Republican legislators have joined against the taxpayer who is David.

He noted though that one uses a slingshot to beat Goliath and not another giant. In Texas, where the union dues of state workers are voluntary, state unions dump about $12 million in political campaigns. In Pennsylvania, they spend $50 million. Pennsylvania, remember, has half the population.

He said the stones for the slingshot are new laws to allow union workers to pay their dues voluntarily. He cited Wisconsin, Michigan and Indiana as having gotten very positive results for average citizens with such laws. He said that in 2012 when Obama was handily winning Michigan an amendment was overwhelmingly voted down — which obviously required the support of a lot of Obama voters — that would have made the mandatory collection of union wages part of the state constitution. It was that, he said, that set things up for the entire state going right-to-work, an event the possibility of which would have been laughed at just a few short months ago.

He noted that unlike Michigan Gov. Rick Snyder, who initially said he would not sign a right-to-work bill, our own Tom Corbett has expressed a willingness to do so from the beginning if one would reach his desk.

Brouillette had generally nice things to say about Corbett, albeit he slammed his unwillingness to get before the public and said he would fire a lot of staffers, who he thought to be encouraging this, if he were running things.

He said the privatization of Pennsylvania’s state store system is not  a done deal and is being held up by Sen. Chuck McIlhinney, the Bucks County Republican with strong ties to the existing system, who chairs the Senate’s Law and Justice Committee. He noted that privatizing the state stores would cut about $1.5 million from union political contributions.

Brouillette, a former history teacher, said that the conventional Tea Party message is compassion-based. He noted that each of his four children is going to start his or her working lives with $60,000 government debt. He said that one of his neighbors, a retiree, has to work an extra job selling tickets to pay his property tax. He said another neighbor has laid off his seven employees from his small building company and has become a one-man business. All this suffering is related to existing governmental policies.

The next meeting of the Delaware County Patriots is tentatively scheduled for May 20. The topic will be Common Core Standards in Education.

Delco Pats Hear Matt Brouillette

Delco Pats Hear Matt Brouillette