C. Jarrett Dieterle is a senior fellow at the R Street Institute and the author of “Give Me Liberty and Give Me a Drink!”
In fact, both are so unwilling to loosen their antiquated booze laws that they risk hamstringing recovering bars and restaurants and keeping employment down in their respective states.
Other states and local governments around the country are permanently changing their alcohol laws to help businesses grow and reap more tax revenue during the pandemic — and yes, giving their residents a little liquid relief in these stressful times — but Maryland and Virginia are falling behind.
Although both states are allowing to-go cocktails during the pandemic, they have not made these reforms permanent as have numerous other states. Doing so would help badly struggling restaurants and bars stay afloat and allow them to rehire furloughed staff at a higher rate. It’s also a freedom that feels distinctly American in a pandemic occurring simultaneously with the 100th anniversary of Prohibition.
But these issues run deeper than just to-go booze.
Modernizing alcohol laws can have economy-wide effects. The drinks sector has shown promising job growth in recent years, including producing some of the most manufacturing job gains of any industry. These jobs will be at a particular premium in the months ahead as increasing numbers of Americans find themselves displaced from work. Allowing craft producers additional opportunities to sell their products will grow their businesses and enable them to hire new employees.
The craft alcohol boom has also generated record amounts of tax revenue for state and local government coffers over the past decade, and the more the drinks sector grows, the more tax revenue it is able to produce. Updating burdensome alcohol laws could help states plug impending budget gaps caused by the recent economic downturn.
Something even simpler is at play for consumers here, too: Maryland is one of only a handful of states that effectively forbids grocery stores from selling beer and wine. Under state law, alcohol retailing licenses are limited to Maryland residents and are not obtainable by chain grocery stores. The result is that things that are an everyday occurrence in D.C. — such as purchasing a six-pack or even sipping a beer while shopping — are unheard of in Maryland.
Prohibiting grocery stores from selling alcohol mostly hurts customers, who are forced to add an extra stop to their weekly shopping routines. And unsurprisingly, more than two-thirds of Marylanders would prefer that their state allow grocery stores alcohol sales.
Permitting these alcohol sales is also good public policy during the pandemic. When we should be encouraging residents to stay at home, grocery stores are often the entities best equipped to deliver alcohol to our doors — if legally permitted to do so — given that they already have procedures in place for delivering food.
Maryland’s alcohol system is also convoluted because it devolves substantial regulatory power to counties. This has allowed locales such as Montgomery County to permit liquor sales only at county-operated stores. Not only are government-run stores a Prohibition-era relic totally at odds with the 21st century, but also the Montgomery County network of liquor stores has become notorious for mishandling orders and losing money.
For its part, Virginia maintains its own system of government-run ABC stores that operate in a similar fashion to Montgomery County’s network but on a statewide level. Also similar to Montgomery County’s operation, Virginia ABC stores have remained stubbornly insulated from reform.
At a time when consumers can order virtually anything online, it makes little sense that private retailers are not allowed to sell distilled spirits alongside these government stores. Again, private retailers are more likely to be adept at delivering alcohol during a pandemic than government-operated agencies, which usually take much longer to develop new protocols and procedures.
Virginia ABC could also pursue other helpful reforms in the short term. During the pandemic, the state has granted craft distilleries the temporary ability to ship to consumers’ homes, but it has refused to make this reform permanent — despite the fact that liquor delivery has long been allowed in nearby D.C.
To be sure, Virginia and Maryland lawmakers will have a lot on their plates when they return to session in 2021, but they would be wise to add alcohol reform to the agenda. If they don’t, both states risk missing a rare opportunity to help small businesses and make people happy.