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July 19, 2012

Let’s modernize state wine sales laws

NORMAN — Thanks to a recent Oklahoma Supreme Court ruling, Oklahomans may soon have the opportunity to partially remove outmoded laws that prevent adults from purchasing wine in grocery stores, as our fellow Americans in most other states are allowed to do. One group, Oklahomans for Modern Laws, is trying to give us that option by circulating a petition to put the issue to a vote of the people. If given the opportunity, we should take it.

The current regulatory regime governing wine purchases, in which government seeks to prevent adults from acting like adults, is primarily the result of state paternalism and economic protectionism, a dangerous combination most often deployed to benefit special interests, subvert the free market, and harm consumers.

In this particular case, retail liquor store owners have banded together to protect their near-monopoly on wine sales in Oklahoma. They claim their sales will suffer and they will go out of business if consumers are given the choice to buy wine elsewhere, particularly in grocery stores.

Evidence from other states that allow wine purchases in grocery stores, however, indicates liquor stores are doing just fine. Go to Indiana, Nebraska, Iowa, Idaho, Florida, California, or any of the 32 states that allow wine sales in grocery stores and you will see liquor stores, many of which are set up adjacent to their grocery store competitors, are thriving.

How can this be? For the same reason fast food restaurants, bakeries, pizzerias, florists, book stores, Hallmarks, pet supply stores, and dozens of other businesses survive even though grocery stores may sell the products each of those businesses sell. Logistically, grocery stores are unable to offer the product selection and specialization that those businesses do. Likewise, liquor stores thrive in states where competition exists because they specialize in wine, beer, and liquor products that consumers want to buy; grocery stores do not (when they sell wine, grocery stores primarily sell the most common and least expensive wines).

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