Last month, Justin Logan blogged about the socialist alcohol controls in Montgomery County, Maryland. For those of you not in the DC area, Montgomery County is a very wealthy, very liberal Washington suburb with our nation’s only completely government‐run alcohol distribution system.
Yesterday, the Washington Post ran an excellent article that describes how this system is an absolute nightmare for the county’s restaurants.
Here’s an overview of the wine distribution process:
Let’s say the restaurant orders the wine from a private distributor on Thursday. The distributor then faxes or hand‐delivers the order to the Department of Liquor Control. A county employee writes up a purchase order and faxes it back to the distributor. On Monday or Tuesday, the distributor delivers the wine to the county warehouse. On Wednesday, a white or navy blue box truck bearing Montgomery’s “Gardez Bien” county seal delivers it to the restaurant.
Now contrast that with the privately‐run distribution system for restaurants in neighboring jurisdictions:
Restaurants in the District and Virginia buy wine from private distributors at wholesale prices, which includes the distributors’ markup. Placing an order is as easy as making a phone call. If an order comes up short or a large party unexpectedly drinks all the Diamond Creek cabernet, the distributor can make a delivery by the next day.
The system results in major headaches for restaurants, limited wine options for oenophiles, and, of course, greater costs for consumers:
A bottle that wholesales for $100 in the District costs Montgomery restaurants $125. If a restaurant tries to double or triple the purchase price — a standard practice — a bottle priced at $200 or $300 in a District restaurant ends up on a Montgomery wine list at $250 or $375.
You might ask why a county would subject itself to such an inefficient and expensive scheme. Well…
“We benefit financially from it,” [Montgomery County Executive Isiah] Leggett Leggett said. “But more importantly, you don’t see liquor stores all over Montgomery County like you might see in other jurisdictions, and I think citizens like that.”
Call me crazy, but I’d prefer a few liquor stores in my neighborhood over outrageously priced, government‐controlled wine.