Government policy on booze is enough to drive you to drink

HOW COULD IT BE summer without taking issue with the high prices of a refreshing adult beverage? Along with the endless string of provincial price increases – part fiscal incompetence, part nanny state – we now have Ottawa angling for an escalator tax on booze, guaranteeing automatic annual increases without oversight or accountability.

On the upside, the province reached a deal with unionized workers to avoid a strike at the LCBO this week.

That might be the only positive of sorts in the government handling of booze, which is a go-to taxation spot for spendthrift politicians. One could argue they should lower taxes to serve as a diversion from the colossal failures of government. Instead, they continually hike taxes knowing we’ll continue to drink, in part due to the colossal failures of government, including unwarranted tax hikes and massive amounts of waste.

Irony, thy name is I need a drink.

Beer, wine and spirits are always being swept up in the move to separate Ontarians from their money.

That’s the reason there’s ongoing contempt for the government in general and, specifically, with a longstanding dissatisfaction with the handling of alcohol sales in the province, from absurd pricing to rigged sales restrictions.

Much of the ire is simply a reflection of our inherent dissatisfaction with the LCBO and paternalistic liquor laws, coupled with our distrust of pretty much anything overseen by bureaucrats and politicians. Tax increases are seen as another reason to privatize the operation, stripping government of its outdated controls of alcohol.

Yes, the stores themselves have come a long way over the years. They’re much nicer places to shop, especially compared with the Beer Store, that even more antiquated government-sanctioned cartel selling us our suds. The hours have been extended, but there’s nothing like the convenience found in other jurisdictions. Nor the selection. And, most gallingly given that the LCBO is the world’s largest buyer of spirits, nothing like the much better prices found elsewhere.

If the LCBO really wants to be accepted, cut the prices significantly, offer a much better selection (something akin to a grocery store in Buffalo would be a start) and offer more convenience.

The province, of course, has no interest in any of that.

With alcohol, as with cigarettes, governments suffer from multiple personality disorder. On the one hand, they’re addicted to the revenues, on the other they want to discourage consumption. The nanny state prevails, but they do love the money. (There’s a similar issue with gasoline, electricity and water, where government preach conservation, but decry the losses when we actually cut back.)

The nanny state is never more apparent when it comes to booze. Ontarians apparently would become hardened alcoholics without a floor on prices and fettered access. All we have to do is look at the problems in nearby provinces and states to see that. Oh, wait, that’s not what you’ll find. And the government doesn’t want you to look elsewhere, lest you become even more upset about the poor state of things here. Disillusionment is bad for the business of re-election.

With its modernization efforts, the LCBO is trying to suck and blow. If the goal is about marketing to boost sales, then that runs completely contrary to a host of regulations (nanny state, remember?) to make alcohol more expensive and less convenient to obtain.

Privatization is not the cure-all, however. As we’ve seen elsewhere, that can and often does lead to higher prices, less selection and, over time, control concentrated in fewer hands.

What’s really needed is a cultural shift to something more European in flavour when it comes to booze: treating adults like, well, adults. Lower prices would be a start, as would allowing some competition in the form of specialized stores that could offer up some of the huge list of products the LCBO seems disinclined to stock (see the craft beer or whisk(e)y selections of some small U.S. shops, for instance).

Touching on the longstanding debate, if beer and wine were sold more widely in grocery and convenience stores (the government is trying this as a PR stunt, rather than an actual change), it would benefit smaller breweries, which are now dependent on a retail channel owned and controlled by their much larger competitors, despite some efforts to be more inclusive.

Pricing is a big issue. In parts of Europe, you can find very drinkable wines for under $3 a bottle. Imports from Australia and the U.S. that run $15 to $20 here can be had for a third of that price. That tells you it’s all about markup and taxes – as noted, successive profligate governments are addicted to the LCBO profits, not to mention the tax revenues.

Where we might be inclined to drop a few bucks on a new Ontario wine or craft beer, the government’s pricing often precludes that option. Backwards policies make it even more difficult for upstarts to reach consumers. As a consequence, the industry suffers.

The province has no interest in consumers or small producers. Next time you’re in the U.S. seeing what real options are like and fuming over the onebottle limit at the border, keep in mind that pricing in Europe, though varied, is mitigated by an EU customs agreement that allows each person to transport 110 litres of beer and 90 litres of wine and 10 litres of liquor from one member country to another on every trip.

That’s a fact that’ll leave you crying in your (overpriced) beer... or wine, should it still be in your budget.