Home Virginia Politics New Study: “Big Alcohol” Driving McDonnell’s Liquor Privatization Plans

New Study: “Big Alcohol” Driving McDonnell’s Liquor Privatization Plans


What’s really driving Bob McDonnell’s liquor privatization plans? According to a new study by the alcohol industry watchdog Marin Institute, it’s very simple:

With Big Alcohol seeking to increase profit margins, across the U.S. powerful corporations and misguided politicians are promoting plans to eliminate state control of alcohol sales, promising better prices and selection in return for less alcohol regulation. As states become more desperate for revenue, a booming alcohol business could overshadow the protection of public health and economic stability.

Here in Virginia, according to the report, McDonnell’s plan would cause “spirits sales” to increase 21 percent, while “total alcohol consumption would increase as much as 7 percent.” This will “cause an estimated $50 million per year in harm paid from state coffers (mostly criminal justice costs), and $1 billion per year in total harm costs.” Privatization also “will decrease annual state alcohol revenue by $200-$300 million,” lead to a tripling – from 332 to 1,000 – in “the number of stores selling spirits,” and even lead to “220 more alcohol-related deaths…each year.”

In other words, this is an absolutely horrendous idea on just about all counts.  But wait, you ask, if it’s such a horrible idea, why would Bob McDonnell go this route? Other than being “misguided” and “desperate for revenue,” perhaps the fact that “McDonnell received $448,407 from Big Alcohol, including Anheuser-Busch, InBev, Diageo, and Associated Distributors,” between 2008 and 2010, might help explain it? But wait, there’s more:

Various corporations and trade groups with an interest in the sale of alcohol are influencing the governor’s inner circle. For example, Costco and Wal-Mart, along with Kroger, Safeway, and Food Lion, are among the major retail chains that formed an alliance called the “ABC Privatization Coalition” to support deregulation efforts.

In addition, five lobbyists from the lobbying firm Eckert Seamans are working on the campaign. Since July 2010, Eckert Seamans has made three $10,000 political contributions to the Republicans’ Virginia House Campaign Committee, the Democrats’ Commonwealth Victory Fund, and the governor’s Opportunity Virginia political action committee.

Large alcoholic beverage producers also have an interest in bolstering their bottom lines through deregulation. Though suppliers and trade organizations officially profess neutrality on privatization, the governor’s office has met numerous times with powerful industry players such as Diageo, MillerCoors, and the Distilled Spirits Council of the United States (DISCUS), the lobbying arm of the spirits industry. Big Alcohol is a constant presence in Virginia state politics, spending thousands of dollars lobbying the state General Assembly.

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