ABC History?

Brent Finnegan -- November 7th, 2009

A column in this weekend’s Washington Post makes reference to Sen. Obenshain’s (rejected) bill to privatize Virginia’s ABC, and suggests that a similar bill might have more momentum after McDonnell takes office.

The story’s author, Garrett Peck, sums up the post-Prohibition chapter of Virginia history.

The ABC system was established in 1934 after Prohibition. There was a huge distrust of alcohol, especially distilled spirits. If you recall, bootleggers had mostly produced spirits, which had a higher profit margin than beer and wine, so the rationale for state distribution was that John Barleycorn had to be controlled. As a result, Virginia developed an awkward hybrid system: Residents could buy liquor at state-run stores, while wine and beer would be sold at any licensed supermarket or specialty retailer, or even convenience stores.

But Peck, author of The Prohibition Hangover, hints that Obenshain’s bill might not have gone far enough.

Obenshain offered a privatization plan that would permit one retail liquor license per 10,000 people. That is actually a rather low ratio: Most states have a licensee rate of one per 2,500 to 3,000 residents. Virginia would hardly be awash in liquor stores.

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13 Responses to “ABC History?”

  1. Gene Hart says:

    This was an area where I have much agreement with many Republican friends and I had hoped to work with them. Alas, not to be. The marketing and sale of alcohol is not a core function of government and the state should divest itself of the ABC stores. Understand however that selling the stores and future licenses will not raise $500 million for transportation; but, the stores should be sold anyways for whatever they will bring. Understand also that we will only “lose” the $100 million in annual revenue that the stores bring (a complaint made by many Democrats) only if the General Assembly sells the stores but refuses to tax alcohol sales at the level necessary to recoup that amount (or more). My greatest fear is that the Republicans in their taxophobia state will privatize the stores and then refuse to properly tax spirits. THAT would be a disaster. Remember, if the ABC store raises the price of Jack Daniels today they may call it increased profit but it is in reality an increased tax on a bottle of Jack. Not saying that is bad, just that it is the proper way to look at it.

    I also hope that any ABC reforms will go beyond ABC store privatization and move towards real deregulation of the alcohol industries. More store licenses than 1:10,000 should be allowed with localities making zoning decisions regarding placement of businesses rather than Richmond. The 55%/45% rule should be abolished so that current restraurants are freed from unnecessarily burdensome regulatory requirements and new entrepreneurs can open up new small businesses. The monopolistic power of the large distributers must be ended to allow direct marketing by producers to customers. Why should Cally’s have to send a keg of their fine beer thru a distributor in order to sell it to their neighbor, The Artful Dodger?

    Done right ABC privatization/deregulation can be a chance for bipartisanship, progress and business growth. Let’s hope it happens and they do it right.

  2. Well put, Gene.

    There are currently only two ABC stores in the city, and none in the county. That’s less than two stores per 100,000 people. Ridiculous. Is the Prohibition over, or not?

  3. Gene Hart says:

    Brent, there are at least 2 ABC stores in Rockingham County: one near Elkton and one in the Wal-Mart shopping center off of 42 before Dayton.

    The free market and profit-motives determine how many fast-food restaurants there are, they determine how many grocery stores there are, why would anyone be afraid for the free enterprise system to determine how many, where and what kind of alcohol stores there will be?

  4. JGFitzgerald says:

    Whether privatized alcohol sales can be adequately taxed probably depends on whether alcohol turns out to be a “right,” like AK-47s and Hummers.

  5. Jamie Smith says:

    One to 10,000 would leave a lot of small towns in SW Va without local stores and a drive to reach one. That’s the way it was with the ABC stores in the ’50’s.

  6. JGFitzgerald says:

    Yeah, but SW Va needs fewer. Coal to Newcastle.

  7. Joe, the 2nd Amendment places no restriction on the type of weapons people may own….like our forefathers intended, we should be allowed to own and possess any weapon our government has, since the intent was to allow us to repel our government, if necessary.

  8. Jamie Smith says:

    Joe, what you said about SWVA was just plain ugly! And now you’ve got Briggman talking about the second amendment!

  9. MF says:

    Hate to get off topic but………. Dave, your suggesting that a person should be able to own a triton 2 rocket system? Do we really want people keeping long range howitzers and tanks in their back yards?

  10. MB Green says:

    Oh! Oh! I want an M-16! Can I have one? The second ammendment says I can!

  11. Nicholas Detweiler-Stoddard says:

    Unfortunately, shameful portions of our tax dollars get spent on militarizing our nation… and I don’t even get to own any of those rockets I paid for.

    Dave I hope you don’t really think you could (or should) fend off a disagreeable US government with your own 2nd Amendment allowed arms. You, like many other residents of our globe, would get the s..t kicked out of you. Armaments and violence have never been an acceptable answer.

  12. Nicholas Detweiler-Stoddard says:

    This thread is about liquor stores, not drunk vigilantes. Apologies.

  13. JGFitzgerald says:


    Granted, I shouldn’t brag about what was once a family business. But there are those in Tazewell who still complain about the quality of what the ABC sells. I don’t know if the stats support the generalization, but it’s more than a Snuffy Smith characterization. And on the other off-thread topic, I invite all the readers to think of any 2nd amendment absolutist, then picture him or her driving a tank. Or does that belong on the parking thread?

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