Why Does the GOP Legislature Fear the Free Market?

Why Does the GOP Legislature Fear the Free Market?

The operator of a large chain of beer and liquor stores says an effort to cap new retail licenses is an effort to stamp out competition in Tennessee.

The main focus of the bill that advanced out of the House State Government Committee on Tuesday is to let supermarkets stock up ahead of when a law allows them to begin selling wine July 1. But the bill would also create a two-license limit for new liquor stores.

“This anti-free trade, anti-competitive provision targets squarely at Total Wine & More,” wrote Kevin Peters, the CEO of the Bethesda, Maryland-based company that operates 131 stores in 18 states.

Peters said the bill would “deprive Tennessee communities of jobs, benefits and consumer choice”

Tennessee lawmakers lifted the cap on licenses as a concession to liquor stores owners who largely opposed the wine-in-supermarkets bill in 2014.

But Rep. Jon Lundberg, R-Bristol and an original sponsor of the supermarket wine bill, said he has “real issues” with reinstating a cap on liquor store licenses.

“What liquor store owners wanted before was the ability to open multiple locations,” Lundberg said. “We gave them that, and now they’re concerned that — oh, my gosh — they could have competition.
“Well, the competition is among themselves,” Lundberg said. “Frankly, that’s how business works.”

David McMahan, a lobbyist for Tennessee Wine and Spirits Retailers Association, said liquor store owners had originally thought that lifting the cap would help them compete with grocery store chains that can sell wine. But now they worry about being squashed by larger competitors.

“We think that would be the one-two punch that would essentially end that industry,” McMahan said. “It would be like Wal-Mart did to downtown squares. There wouldn’t be many liquor stores left.” (continue reading)

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