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20 Mar 2011

Private profits over public good – misguided principles

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March 20, 2011 Category: Local Posted by:

By W. David Wanamaker

President, Independent State Store Union


At a time when Pennsylvania is still reeling from the devastating fiscal impact of the national recession, we question the logic and motivation of Governor Corbett in calling for a task force on the privatization of the state store system.


The dramatic reductions to program funding contained in his budget address illustrates the need for every public dollar to be spent more wisely. The Governor reaffirmed this need when he said the state must reinvent how we spend other people’s money.


Given the Governor’s call for smarter spending, we have to question why he would propose spending even one penny of taxpayer dollars on a task force to study a system that has not cost the state one penny in over 77 years. While the Governor stated that “government will never be cost free,” our current alcohol control and distribution system is exactly that – cost free.


In fact, the current system is not only totally self-supporting, the system has generated over $481.5 million in revenue to the state budget during last year alone and provided an additional $32.3 million in funding for alcohol enforcement, drug and alcohol programs and municipal budgets.


At a time when every elected official throughout this commonwealth is concerned with decreasing revenue and financial support necessary to maintain programs and services, it makes no sense to target for elimination an income producing system solely for the purpose of making government smaller.


We would respectfully suggest that privatization of the state store system should not be a priority of the Corbett administration. The recurring revenue provided by the current system – as opposed to a one time infusion of revenue that might be provided by a sell-off- goes further in accomplishing the Governor’s call to be better stewards of the cash that farmers and clerks and mill hands and nurses earn dollar-by-dollar than privatization would ever achieve.


If the Governor is serious about stopping “the one-time fixes and gimmicks that have barely held the machine of government together” then he and the General Assembly should focus their time and attention on other revenue generating priorities – not eliminating reliable and substantial funding sources.


We also strongly disagree with the Governor’s assessment and statement that we should get out of a business that we should never have entered – the liquor business.


First, and foremost, the state store system is not a business – it is a government agency charged with the responsible control and distribution of alcohol to promote and protect the health, safety and welfare of the public.


The control of the sale of alcoholic beverages is a legitimate function of state government in serving the public good and the free-market assertion regarding privatization should be secondary to the public good.


It is imperative to remember that alcohol is the most widely abused drug in the nation. Studies have consistently concluded that a state controlled alcohol distribution system – such as the system Pennsylvania currently has in place – reduces the harms associated with alcohol abuse by promoting the responsible distribution and consumption of alcohol. We believe Pennsylvania has the most responsible and effective alcohol distribution system in the world and is far superior in curbing and reducing the harms associated with the irresponsible use and abuse of alcohol that occur under privatized distribution systems.


In his address, the Governor drew an interesting comparison between liquor stores, gas stations and pharmacies. We do not believe the state should be operating gas stations; nor do we believe that gas stations should be operating liquor stores.


Alcohol is not an ordinary commodity and should not be treated as such. It is the number one abused drug in the nation. And, like pharmacies, it is reasonable to expect that the sale and distribution of this potentially dangerous drug be conducted in a reasonable and safe manner. The current system of well-trained civil servants – tested, hired, and held responsible to Civil Service rules for continued employment – provides the reasonable assurances necessary to protect the public interest.


The Governor and other politicians should stop attacking reasonable alcohol regulation in their call for smaller government; alcohol is strictly regulated because it is potentially harmful. We see no public benefit to a system that provides for the purchase of a bottle of Captain Morgan liquor and a box of Captain Crunch cereal in the same grocery aisle.


We agree with the Governor’s assessment and proclamation that “business and its opportunities belong to the people.” However, the sale of a potentially dangerous drug is not an opportunity – it is a public policy principle.


If, as the Governor claims, “it’s about the principle” and “it’s time to give an account of our stewardship” then we urge Governor Corbett to reject the selfish motives of the privatization profiteers in favor of the Common Good for the Commonwealth.

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