Editing Official Position on the Beer Store & LCBO

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===Bring the Competition:LCBO & The Beer Store===
The LCBO is the Ontario government alcoholic beverage monopoly. It was established in 1927 after a brief attempt at alcohol prohibition.

The supporters of the LCBO monopoly do so, because they claim (based on government and union sources) that it brings in revenue for the province. That's reassuring, even the government can't screw this up. It is no surprise that the government can sell beer, wine, and liquor to the exclusion of most competition and they make a profit! It's a classic case of looking at just one side of the economic equation. The citizens of Ontario are taxed heavily for alcoholic beverages, and the government also fixes the price and eliminates competition, and they make profit. How hard is that? Of course they do.

A run-of-the-mill case of 24 beer cans in Niagara Falls Ontario will cost about $40 at the LCBO, and across the imaginary line in Niagara Falls,New York, at the Walmart, it costs $18.

The LCBO is one of the largest bulk buyers of alcohol in the world, so why don’t Ontarians get a better price? Several reasons. 
*It’s for our own good : As part of Ontario’s nanny-state-syndrome, our politicians don't think the good people of Ontario are smart enough to handle their liquor. So we get a guilt message each time we purchase. High price is part of the social engineering or as they call it "social responsibility."
*Unionized work force : The Ontario government has a monopoly agreement with the LCBO workers through their union OPSEU.  Imagine a mom-and-pop variety store selling beer and liquor in the United States. They make a living if they compete with other retail outlets, but there is no guarantee of salary. It depends on their ability to provide value.  Not true at the LCBO. A store manager makes over $61,000 annually in a 40 hour week with great benefits (see page 90 of the OPSEU collective agreement). I have nothing against unions, but the Ontario Libertarian Party believes that paying a cashier $55,000 plus benefits is outrageous. 
*Backwards Operating Logic : The LCBO also competes for “share of wallet”, that is, discretionary spending.  Discretionary spending is money that consumers may decide to allocate towards other retailers for things like Christmas gifts, luxury food, or movies, instead of a bottle of wine with dinner. However, to paraphrase the LCBO, “it’s important that customers visit our stores because they want to, not because they have to. Unlike other retailers, however, we can’t offer deep price discounts. That would not be socially responsible.”  
*Low competition : The LCBO claims it has competition. Their own data sources shows that more than 77% of liquor sales are from the government monopoly.  See the figure on the next table for a visual breakdown of the monopolistic LCBO accounting for 50% of the total liquor sales in Ontario, and The Beer Store, albeit a private monopoly sanctioned by the government, to sell beer.  T
*Hidden Costs : The third reason why Ontario has to pay so much for liquor is the ridiculous product mark-ups ranging from 38% to 52%, that’s before the “behind the sticker” 12% to 25% tax rates.  $0.11 of every dollar the LCBO takes in as revenue, goes towards their stores or marketing.  The Ontario Libertarian Party questions why a state own monopoly needs to spend any money at all, on advertising.  We hypothesize that changing the line item name on their report from marketing, to propaganda, would be a better representation of where some of the hidden costs go at the LCBO.
[[File:LiquorSalesInOntario2010.png]]

===Corrupt Reporting Methods: Making Up Numbers & Changing the Units===
In between annual reports, the LCBO manipulated the numbers to attempt to make themselves appear like a smaller market participant.  In past reports they reported channel data using their own sales contrasted against the derived sales based on volume for their ‘competition’.  They used the average retail rate in the LCBO stores, to calculate the estimated sales of illegal options.   The Ontario Libertarian Party is highly skeptical that the illegal options cost the same amount as the legal options.  We hypothesize that the average price of illegal options is lower than the price of legal ones.  Using their calculation method, it produced the pie chart shown in the previous section, with what we believe is likely understated total amount of monopolistic sales.  When this data was released, the Ontario Libertarian Party is on record pointing out how skewed the numbers seemed.
In more recent annual reports (2011), pg 88, they admit there numbers were inflated.  The government actually admitted their own incompetence. However, now, they report the volume sold by each channel.  This new data set allows the LCBO to point to the Beer Store as the largest channel.  Now, the data shows that monopolistic government liquor sales are 89.5% - by volume.  
===Our Plan===
The Ontario Libertarian Party would quickly and simply legalize competition.  Convenience stores, groceries stores, would all quickly become competitors with the LCBO.  It’s our belief that the people of Ontario would quickly be given more choices, convenience and quality at a lower price.
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