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Virginia ponders losing ABC stores; studies conflict on privatizing liquor sales

Gov. Robert F. McDonnell is pushing for privatization.
Gov. Robert F. McDonnell is pushing for privatization. (Bob Brown - AP)
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By Rosalind S. Helderman
Washington Post Staff Writer
Sunday, August 29, 2010

RICHMOND -- As Gov. Robert F. McDonnell pushes a proposal to privatize state-owned liquor stores, he has reassured the public that problems associated with drinking would be unlikely to worsen if the state government relinquished control over distilled spirits.

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"All the data shows there is no difference in drunken driving or crime whatsoever between control states and between privatized states," McDonnell said in a recent radio appearance.

The governor can point to several studies that found little difference in binge drinking, alcohol-related fatalities or drunken-driving deaths between the 18 states that retain some control over the sale of alcohol and the other 32 states and the District, which do not.

But McDonnell did not acknowledge other studies, completed by researchers across the country, that found public health differences between the two situations.

"If you make it easier to drink, people drink more. And if people drink more, we have more alcohol-related problems. It's as simple and basic as that," said Alexander C. Wagenaar, an epidemiologist at the University of Florida's medical school who has conducted studies that found consumption rose after privatization in Iowa and West Virginia.

McDonnell is traveling the state conducting town hall meetings, including a stop in Herndon on Wednesday night, to sell Virginians on his plan. He is expected to unveil a detailed proposal Sept. 8 for breaking up the state's 76-year monopoly on the wholesale and retail distribution of distilled spirits.

Philosophically, the Republican governor believes that selling liquor shouldn't be a government enterprise. He contends that the state could reap an upfront windfall of $300 million to $800 million that could go to fixing roads. He also contends that privatization would result in more conveniently located stores with better selections for consumers.

McDonnell plans to call a special session of the General Assembly this year to consider the plan. To prevail, he will probably have to win a debate about the public health and safety implications of the change.

To address the concerns, McDonnell and his aides have pointed to studies concluding that states with private systems don't experience greater alcohol problems.

One such study, written by a George Mason University economist and published in June by the Virginia Institute for Public Policy -- a think tank that advocates limited government -- found that the number of alcohol-related deaths per 100,000 residents is virtually identical in control states and private states. It also showed little difference in binge drinking or drunken-driving fatalities.

A much broader study in Pennsylvania examined 36 years of data from 48 states with varying degrees of alcohol control. It found that private states have lower per-capita alcohol consumption and lower drunken-driving fatalities than states where government controls segments of the industry. It found no significant difference in underage drinking between the two models.

Like the recent Virginia report, it was funded by a foundation that advocates smaller government. But its author has submitted the findings to an academic journal for review, and he defended the results as unbiased.


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