Sunday, August 08, 2010

My Interview with Virginia Governor Bob McDonnell

Nearly 15 years ago, syndicated columnist Deroy Murdock wrote an article that appeared in the Washington Times (February 26, 1996; not available on the Web) with the headline, "Prohibition, alive in Virginia."

Murdock focused particularly on a then-pending lawsuit concerning the Commonwealth of Virginia that had been brought by a wine distributor, in a case known as Brown-Forman Corporation vs. Sims Wholesale Company.  He also took broader aim, however, at Virginia's post-Prohibition system of controls over the sale and distribution of beer, wine, and spirits, including a government-owned and -operated monopoly on the wholesale and retail sales of distilled spirits (that is, liquor).

Murdock quoted a libertarian political activist who at the time lived in Arlington County, across the Potomac River from Washington, D.C.:
Stiff limits on the importation of alcohol lift this 80-proof trade wall even higher. It is against state law to bring more than one gallon of wine, beer or spirits into Virginia. Despite the fact that "you could reasonably say that the prices in Washington, D.C. are lower than in Virginia," as Mr. [Curtis] Coleburn states, anyone who bought a case of beer in Georgetown and drove it to a barbeque in Fairfax would be a lawbreaker.

All of this limits consumer choice. "In Arlington County, with a population of 200,000, there are only four ABC stores I am aware of," says writer and policy analyst Richard Sincere. "In a four-block radius of my office in downtown Washington, D.C., there are six or eight liquor stores." Mr. Sincere also sees far more variety in District stores than in Virginia's. Washington retailers "sell more than liquor." "They have cheese, wine glasses, potato chips and newspapers. The Virginia ABC stores have all the personality of a DMV office. They're plain cinderblock structures with plain walls. There are no advertising posters, no color. They remind me of my trip to the Soviet Union in 1987. There were stores there that just were called `Milk' or `Bread.' In Virginia, they say `ABC Store' in big block letters. This is the last vestige of socialism in Virginia."
In a suggestion aimed at then-Governor George F. Allen and the still-Democratic-majority General Assembly, Murdock said that privatization was overdue:
The Elliott Ness-era moonshine still that is Virginia's alcohol policy should be streamlined for the 21st Century. Wine and spirits manufacturers should be free to hire and fire distributors as swiftly as law firms can pick and choose among FedEx, UPS and Airborne. State liquor stores should be privatized, perhaps with their public-sector employees given the first crack at buying the means of alcohol distribution at a fair market price. Virginia's alcohol consumers should be free to shop in Washington. and surrounding states to satisfy their wallets and taste buds. And if they drink what they buy on the drive home, they should be arrested and stripped of their drivers' licenses.
Fast forward a decade and a half, and we can see that this issue is still on Virginia's agenda.  Governors since George Allen have urged consideration of privatization proposals, but there has been no movement.  Now, however, a window of opportunity may exist for Virginia's political leaders to make a decision that modernizes and liberalizes the ABC system, acknowledging that the free market is better than socialism.  This time, ABC privatization is a top priority for Virginia's governor.

On Wednesday evening in Roanoke, Governor Bob McDonnell hosted a town hall meeting to discuss his government reform proposals with constituents, some of whom came from as far away as Craig County.

While McDonnell insists (see video below) that there are "hundreds" of suggestions for government reform -- making government more effective, more efficient, and less costly -- the centerpiece and most popular (and most controversial) of those suggestions is the one he made during last year's gubernatorial campaign.  That is, to privatize the state's monopoly on liquor sales, turn it over to the private sector, and use the hundreds of millions of dollars in proceeds to pay for improving Virginia's transportation network.

About an hour before the town hall meeting began in the chamber of the Roanoke County Board of Supervisors in front of a standing-room-only audience, Governor McDonnell sat down with me for a one-on-one interview on the specific issue of ABC privatization.

An edited transcript of our conversation can now be seen in two parts on  You can read Part 1 here, and Part 2 here.

The complete conversation can be seen on this video, taken by Steven C. Latimer.

Other articles I have written on the topic of ABC privatization include an interview with Garrett Peck, author of The Prohibition Hangover: Alcohol in America from Demon Rum to Cult Cabernet; another with's Nick Gillespie, who calls Virginia's monopoly control of distilled spirits "mind numbing"; and a third with Antony Davies, an economist affiliated with the Mercatus Center at GMU who teaches at Duquesne University, who has studied the differences between control- and free-market states over a 36-year period.

I have some other interviews on this topic "in the can," so look for them on soon.
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