Temperance Smokescreen and HR 5034

Various parties—from distributors to retailers in states where supermarket sales are banned—claim that alcohol regulations safeguard public health and protect children by limiting access to these products.

A bill before Congress–H.R. 5034–supposedly would promote “temperance and orderly markets” by empowering states to increase regulations. “Easy and cheap access to alcohol isn’t the answer” noted Craig Wolf, president of the Wine and Spirits Wholesalers of America (WSWA) at congressional hearings earlier this year related to a draft of this bill. The WSWA apparently thinks that such access is a problem: [W]e know this from the many social ills that deregulation has brought on in the United Kingdom,” explained Wolf. In addition, government officials also make these arguments when fighting proposed privatization of government liquor stores.

But the “temperance” argument appears to be little more than a smokescreen. A study soon to be published by the Virginia Public Policy Institute by Donald J. Boudreaux and Julia C. Williams found that increased consumer access to alcohol via private versus public stores has no relationship to binge drinking or alcohol-related deaths.

The study compares states where at least some kinds of alcohol (often simply spirits) are sold only in government stores (so-called “control states”) to states where all alcohol is sold in private establishments (so-called “license states”).

Their data strongly question the “temperance” arguments used to justify government controls. A summary appears in the Richmond Times Dispatch that is worth quoting here at length:

[W]e compared the 18 states that “control” alcohol distribution by directly running retail or wholesale establishments with the 32 states and the District of Columbia that simply license private retailers and wholesalers. Our goal is to see if the “control” states do in fact suffer fewer alcohol-related health and social problems than do the “license” states.

The answer is no.

In control states, for the years 2001-2005, an average of 33.79 persons per 100,000 population died each year from alcohol-related causes. In license states this figure is 34.64. The figure for the U.S. as a whole is 34.34.
Clearly, states that directly run alcohol-distribution operations suffer as many alcohol-related deaths as do states that do not run any such operations.

What about more narrowly defined alcohol-related problems, such as binge drinking? (Binge drinking is defined, rather vaguely, by the National Institute on Alcoholism and Alcohol Abuse as the consumption of five or more drinks for a male, or four or more drinks for a female, during a single “occasion.”) Even here, the data lend no support to those who assert that liberalizing alcohol distribution will cause more problems.

In control states, 9.95 percent of 12-17 year olds binge drink. In license states the figure is 10.17. The national average is 10.09 percent. For 18-25 year olds, binge-drinking rates average 42.77 percent in control states and 44.02 in license states. The national average for this age group is 43.58 percent.

As with total alcohol-related deaths, there is no statistically significant difference between the averages of these figures for control states and those for license states.

What about drunk-driving fatalities? Here, too, there is no difference between control states and license states. The average annual number of drunk-driving fatalities for control states was 31.06 per 100 driving fatalities in 2008; the average annual number of drunk-driving fatalities for license states in 2008 was 31.85. The national average was 31.57.

Boudreaux and Williams conclude that public health and safety are not valid grounds to deny privatization and liberalization of alcohol markets, actions that would benefit consumers and local economies. Indeed, nor do such arguments justify H.R. 5034, which could lead to regulations on direct shipping to consumers and possibly many other foolish laws. For more background on HR 5034, see StopHR5034.