Washington Initiative 1183

I find the stark differences between the distribution and retailing of alcohol on the one hand, and almost any other consumer product on the other hand, to offer a fascinating commentary about US society. No doubt the contemporary wine and spirits industry remains a potentially interesting, if unwritten, chapter in the history of the Protestant ethic and the spirit of capitalism.

In a previous post, I discussed the bizarre shipping prohibitions that still encumber many wine buyers. Today, my attention was drawn to a Wall Street Journal article on a ballot initiative in Washington state aimed at replacing “hundreds of state-run liquor stores with private retail outlets” while also allowing “retailers to buy liquor directly from distillers and negotiate volume discounts.”

To add to the intrigue, rather than an instance of grassroots mobilization, the initiative is being sponsored primarily by corporate interests. Costco has funded almost the entire “Yes” effort, while the Wine and Spirits Wholesalers of America have funded almost the entire “No” effort. The State is involved too, seeing privatization as a chance to generate more revenue. As a result, “[i]t isn’t clear whether a consumer buying a bottle of whiskey would see prices go down.”

In other words, no matter who wins the initiative, consumers may not come out ahead, even though their “interests” are allegedly at the heart of the matter. Instead, what appears to be at stake is simply how the liquor pie gets divided. Costco and Washington state want a bigger piece, while the existing wholesalers and retailers are reluctant to give up what they have had since the end of prohibition. How’s that for reform?