I read this morning that the president of The Beer Store is warning Ontario beer drinkers of higher prices if the province allows convenience stores to sell beer, breaking his company’s long-held monopoly.
Ted Moroz on Monday was apparently responding to the Ontario Tory proposal to allow convenience and grocery stores to sell beer.
Currently, the distribution and retail sales of beer is regulated by the province, giving The Beer Store a de facto monopoly. Curiously, The Beer Store is owned jointly by foreign-controlled brewers: Molson, Labatt and Sleeman. Moroz claims that, should the province open up beer sales to other retail outlets, beer prices will go up, with a 24-carton costing $10 more.
What a load of rancid hops! This ranks right down there with the head guy over at Canada Post telling us that seniors were in favour of the discontinuance of home delivery because they wanted more exercise. Both men, it seems to me, believe we are idiots, or perhaps just chumps.
I studied economics as a young adult and have read widely on the subject since then, and I cannot remember claims that monopolies keep prices down. When monopolies—or near-monopolies—are busted, prices go down because of the added competition. That’s the norm.
Granted, some government-owned monopolies do offer lower prices, but that’s because of government subsidies. And, as we all know, the Ontario government does not subsidize the price of beer.
I cannot for the life of me understand why the Ontario government persists in giving three beer companies control of the marketplace. These three set the retail price as well as the wholesale/transfer price, and they mark up their products as they will. The mystery only deepens when one considers the three favoured companies are foreign-owned.
Will, I wonder, this province ever grow up when it comes to selling alcohol and allow a free-market? Probably not—at least, not in my lifetime.
Tim Hudak, the leader of the Progressive Conservative party, is reported to be in favour of convenience stores being allowed to sell beer. I’d not count too heavily on this ever happening though, because we’ve heard promises like this before and they’ve come to naught. It’s probably just another election thing.
As to Kathleen Wynne’s Liberal government: they have pretty well told us they favour the status quo. There is no way whatsoever the Grits will allow those overpaid-underworked union jobs to be subject to the vagaries of a free-market economy. Trade union support is, after all, a corner stone of the Liberals’ election strategy.
Here are three news stories of Ted Moroz’s rather lame attempt to scare away any thoughts about a free beer market: Star, Financial Post and Sun. And here’s a must-read for those who are wondering what the fuss is all about.
Decide for yourselves.