Saturday, Dec 20, 2014

Spirit of crony capitalism still alive

By
Published:   |   Updated: June 10, 2014 at 03:37 PM

View allPage 1 of 2

Page 2 of 2 | View all Previous page

Last year my Publix supermarket underwent extensive renovation, even closing its pharmacy for about a month. When it was all finished, there was a new deli, a coffee bar and a liquor store next door.

I asked one of the managers why they didn't put the liquor in the main store along with the expanded wine selection. He looked at me somewhat puzzled and said, “Because it's against the law.”

Silly me. I have noticed at places like Sam's Club that a separate liquor store exists right next door, but I never gave it much thought. And imagine my shock when I found out that the law requiring this goes back to 1935 when each state was allowed to enact statutes to deal with the repeal of Prohibition.

The Republican philosophy since the Reagan years has been that government is too big and that federal, state and local regulations burden businesses and stifle competition. I can't think of a better example of this than the liquor-separation law. If stores like Publix and Wal-Mart want to sell liquor, they have to build a smaller, separate shop next door. Additionally, they have to pay for a clerk or two to operate it, whereas employees in the main store could do the stocking and checking out of purchases.

❖ ❖ ❖

So I was happy to see state lawmakers propose legislation that would allow consumers to purchase distilled spirits in the same store where they can buy wine and beer, something already allowed in 34 other states. I figured repealing it would be a no-brainer, like last year when the Legislature abolished regulatory burdens such as the law mandating a 10 percent ethanol blend in gasoline, and the one requiring foreign visitors to have an international driving permit.

Last week, however, one of the sponsors of the bill, Sen. Bill Galvano, R-Bradenton, announced the legislation was dead, killed by intense lobbying from liquor-store chains and convenience-store interests that like things just as they are. So much for free enterprise.

The excuse given by opponents was that the law needs to stay in place to keep underage drinkers from having access to the hard stuff. Really?

According to a 2011 study by the Centers for Disease Control, the majority of underage drinkers reported getting their alcohol from adults. It would also seem that the same safeguards that grocery chains and big-box stores use to keep wine and beer out of the hands of teens would apply to the hard stuff.

Meanwhile, retailers will continue to be burdened by this costly, outdated law, and consumers still will be inconvenienced by having to do in two stores what they could have done in one.

How did this happen? Former state Sen. Paul Dockery, who served 16 years in Tallahassee, summed it up best in a column that appeared in the April 6 Tribune: “One lesson I learned from many years in the Florida Legislature is that regulatory reform is easier said than done; it is never-ending and difficult to quantify.”

❖ ❖ ❖

She is so right, and this liquor-separation law is a good example of how smaller-government rhetoric loses out to big-lobbyist reality.

There's a term for this kind of selective regulation: crony capitalism. The website www.businessdictionary.com defines it as: An economy that is nominally free-market, but allows for preferential regulation and other favorable government intervention based on personal relationships. In such a system, the false appearance of “pure” capitalism is publicly maintained to preserve the exclusive influence of well-connected individuals.

That's why the wall between vodka and veggies will remain in Florida.

View allPage 1 of 2

Page 2 of 2 | View all Previous page

Subscribe to The St. Petersburg Tribune

Comments