Originally published Thursday, October 27, 2011 at 3:46 PM

One more reason to vote 'yes' on Initiative 1183

The Seattle Times editorial board argues against ESSB 5942, the law that allows Washington to lease its wholesale liquor monopoly to a private investor, and for Initiative 1183, which would privatize liquor at wholesale and retail.

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ONE of the best reasons to vote for Initiative 1183, which would end the state liquor monopoly, has been little mentioned in the debate so far. If I-1183 fails, the state will likely subject itself to a private liquor monopoly — a dubious adventure in crony capitalism.

The bill to do this is already law: Engrossed Substitute Senate Bill 5942, quietly signed by Gov. Chris Gregoire months ago. Under this law, the state would turn over all liquor wholesaling in Washington to one private monopolist. This company would be the exclusive supplier to the state liquor stores, probably for 10 years.

Why would the state create a private monopoly to sell to itself? For money. For lots of money, up front, to help the state with an immediate problem. The original proposal, from political operative Tom Luce of Tacoma, suggested that investors would be willing to pay the state $300 million for such a concession. In return, state and local governments would have to live with sharply lower liquor revenues for the following decade.

We do not know the actual proposals because the state has not disclosed them. Would it be $300 million, and would local governments get any of it? We do know the state has accepted two bids, one is from Luce's group and one from a cabal of liquor wholesalers. The state plans to announce a winner, if any, on Wednesday.

That is six days before Election Day. The timing is no accident. It is designed to confuse voters, with the idea the confused voters will say "no."

If voters see through this confusion and approve I-1183, the private-monopoly law would be repealed and consigned to the garbage dump of bad ideas, where it belongs. But if voters want to keep the state liquor stores, thinking they are preserving a valuable public asset, they will be in for a surprise. The ball is already rolling to lease part of that asset — the wholesale monopoly — to private investors from outside of Washington.

The cost of taking their money now will be sharp reduction in liquor revenue for state and local government for 10 years. This is a kind of disguised deficit spending, much like the "securitizing" of tobacco revenues in the past decade. It is borrowing from the future.

The best way to kill this doubly bad idea is to vote yes on Initiative 1183.


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