Albany Mulls Sale of Wine in Groceries NEW YORK, NY, July 28, 2010 -- We often complain about laws or conditions that we believe are wrong or unjustified. Sometimes we ask how these conditions are allowed to continue, when the injustice of the situation is relatively apparent.Budget Deadlock - Day 119
The answer to that question is often simple: the forces that benefit from the injustice have more influence in the legislature than those who suffer because of it. There are numerous situations in which a law or a regulation benefits a small number of people or businesses at the expense or to the detriment of the general public. Those with a specific interest in particular situations hire other people, known as lobbyists, to influence the legislature on their behalf.
Now lobbying is a legitimate industry, protected to some extent by the First Amendment rights of individuals and now, of corporations. It also professionalizes contact with lawmakers, which many people just do not know how to do.
The problem is that lobbyists have a tendency to monopolize access to legislators. Ordinary people, without the time or resources of a lobbying firm, often have a hard time getting through the door. They find it necessary to hire a professional in order to be heard. Also, lobbyists bring money, in the form of campaign contributions from their clients, which create a general feeling of good will in the recipient toward the donor. That is human nature, and if a legislator did not appreciate contributions he would be considered arrogant, indifferent and ungrateful. If he responded only to contributions, he would be corrupt, but that is a difficult matter to prove.
It is true that both sides to a controversy can hire lobbyists, and equal contributions by people with opposite interests can level the playing field for legislators' favor. Unhappily, the general public interest is less likely to organize itself than a specific commercial group, which is likely to have a direct financial interest in the particular piece of legislation.
This issue is clearly presented in Governor Paterson's proposal to allow the sale of wine in liquor stores, on payment of a licensing fee to the state. The governor sees this as a way to increase revenue, and he estimates that the tax will raise between $147 and $300 million in the next two years. The fee would rise for stores with larger total sales, so large supermarkets would have to pay more. Thirty-five states currently allow the sale of wine in supermarkets, and according to a February 22, 2010 poll conducted by the Siena Research Institute, New Yorkers support making our state the 36th to do so by a margin of 58 per cent to 39 per cent.
As even the most casual sommelier knows, New York State is a producer of wine, particularly in the Finger Lakes area. If wine could be sold in more places that would presumably help the agricultural portion of the New York State economy. Upstate needs all the economic stimulus it can get, and the increase in the sale of wine would benefit vineyards in the Finger Lakes region, among others.
The people who would lose under the governor's proposal are the owners of liquor stores, which now have a monopoly on the sale of liquor, although they can, and do, also sell wine. There are over a thousand independent liquor stores in New York State, many of which are so-called "mom and pop" stores, although we do not see too many moms selling liquor.
Opponents of the bill say it will hurt their business, and it probably will. If people can buy wine at supermarkets, they will have the advantage of convenience as well as a lower markup.
At least one union objects, as well. According to a press release from the United Food and Commercial Workers International Union (UFCW), circulated on the New York State Liquor Store Association's website, "This bad idea will force more than 1,000 stores to close across New York State - and that will mean the loss of hundreds of jobs for union members who sell and deliver to these stores. Fewer stores mean fewer delivery jobs and fewer sales jobs for our union members, both upstate and in the New York City region, since Big Box stores have their own networks already."
A winery owner makes a different argument against the bill. He says that liquor stores are not allowed to be open 24 hours, must pay their bills within 30 days and are subject to State Liquor Authority inspections. He sees teenage supermarket clerks selling wine to teenage drivers late at night, a scenario where car crashes and fatalities are predictable. The force of those objections is weakened by the fact that supermarkets are already allowed to sell beer on payment of a license fee to the state. Teenagers can get drunk on beer, and often do.
Wine has a far higher alcohol content than beer, although the percentage of alcohol in each product varies from band to brand. During the ProhibitionEra in the United States, 1920 to 1933, the sale of beverages with over .5 per cent (half of 1 %) alcohol was forbidden. Prohibition was adopted by the 18th Amendment to the Constitution in 1920, and repealed by the 21st Amendment in 1933.
Constitutional amendments require ratification by three quarters of the state legislatures. New York State was the 43rd to ratify prohibition (it had taken effect at the 36th ratification, since there were 48 states in the Union from 1912 to 1959). New York was the 9th to ratify repeal, which indicates greater enthusiasm for the wets than there was for the drys. Even today, some Midwestern and Southern counties prohibit the sale of alcoholic beverages. Thirty-three states have laws permitting local option on this issue.
Another example of competition between business interests was the law forbidding the sale of yellow margarine in New York State. In 1886 New York and New Jersey prohibited the manufacture and sale of yellow colored margarine. That law remained on the books in New York until 1952, with consumer advocates supporting its repeal and upstate Senators resisting.
Wisconsin and Minnesota, both agricultural states with numerous cows, were the last to repeal their laws preventing the sale of yellow margarine, Minnesota in 1963 and Wisconsin, The Dairy State, in 1967.
The general public interest, it seems to us, would be furthered by the availability for sale of wine in supermarkets. That is the law in 35 states. Trader Joe's sells wine in its New York stores; it is apparently not considered a supermarket.
Red wine is now considered healthful because it contains resveratrol, and observers point to a relatively low rate of heart attacks in France, where a great deal of wine is consumed. The health argument has not, as yet, been seen as influencing the decision on the issue.
The margarine war is a historic example of commercial interest using the law to injure their rivals and promote their own interests. The wine in supermarkets issue is current. Legislators will make their decision on the basis of political and economic considerations. Unfortunately, many will decide on the basis of how these factors affect them personally, rather than on how they affect the general public. That is Albany dealing with a substantive issue.
Henry J. Stern writes as StarQuest. Direct email to him atStarQuest@NYCivic.org. Peruse Mr. Stern’s writing at New York Civic.
