PA Liquor Privatization: King Corbett Pitting State Liquor Store Employees vs. Public School Teachers

PrinceTomCIn the 2013/2014 budget, Governor Tom Corbett is expected to flat fund education, which means that we shouldn’t expect proposed draconian cuts to public education for the third year in a row.  In fact, the message coming from Governor Corbett and his Budget Secretary Charles Zogby – who strikingly resembles Bill Lumbergh from “Office Space” –  is that we should be on our knees and kissing their feet because they have reigned in “wasteful spending” through gutting the education, higher education, the General Fund, welfare, tourism, disability and other budgets.   While at the same time, they’ve dolled out tax breaks to the Natural Gas Industry and your potential employer who gets to keep 95% of your state income taxes if he, she or them hire 250 people in 5 years.

Under Corbett’s disastrous tenure, unemployment has hovered around 8% while tens of thousands of public sector workers have lost their jobs due to prior budget cuts. Now the Governor is risking the jobs of three thousand more public sector employees- this time those working in the state liquor stores – so teachers and education advocates can kiss the feet of King Corbett for restoring education funding with what equates to 40 pieces of silver.  Grant it, the outdated liquor and beer laws in Pennsylvania need to be modernized, but that is not the heart of the issue.  The heart of the issue is trying to force a union that will benefit from this privatization process against the union representing the thousands of workers that have just been put on layoff notice.

In Orwellian fashion, the King’s plan to fund education through the wholesale of the state stores is aptly named the “Passport for Learning.”  “The Plan” will generate 1 billion dollars over 4 years through selling wholesale licenses, auctioning off the wine and spirits stores, selling wine and beer licenses and selling “enhanced” licenses to beer distributors.  Then the money will be distributed through  “block grant” programs, which means there will be strings attached to the distribution of these funds.  This also creates a problem because these “strings” will probably be performance based initiatives which could ultimately leave out school districts that need the money the most – say Philadelphia, Reading, Harrisburg, Allentown and Chester Upland to name a few.  The money will go towards “school safety, early learning, and science, technology, engineering and mathematics courses programming.”  Before I get into where we should be really getting this money, let me diverge for a quick moment because  the first item on the agenda is an interesting item.  With Pennsylvania Republicans trying to ban any federal gun control legislation in the wake of the Newtown tragedy, is Governor Corbett trying to pander to the hard right and have more “good guys with guns” so they would be able to stop the “bad guys with guns?”  If Corbett keeps to his record, the people of Pennsylvania won’t know because his administration likes to release sexy talking points while keeping his horrid plans under lock and key – IE) the privatization of the Lottery System.

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With Right To Work legislation waiting to be debated in the House, will the King get his kicks watching two different public sector unions squabbling with each other over the idea that we should fund education – for only 4 years – on the backs of thousands of middle class workers who essentially got their layoff notices or will “the Plan” spark an actual debate on how we should be funding education in this Commonwealth?  The answer is obvious, we shouldn’t rely on the selling of state assets to fund education when our government has allowed those making the most over the past 4 years to share no sacrifice whatsoever during this time.


Sean Kitchen is an Assistant Editor and Social Media Organizer for Raging Chicken Press. He is student at Kutztown University.  You can follow him on twitter @RCPress_Sean.

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About Sean Kitchen 681 Articles
Contributor and Assistant Editor for the Raging Chicken Press. Stationed in Harrisburg covering politics in the capitol. You can send tips to or reach me on twitter at @RCPress_Sean!
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2 Comments on PA Liquor Privatization: King Corbett Pitting State Liquor Store Employees vs. Public School Teachers

  1. Here are the last four states that privatized elements of their liquor sales.

    Iowa went private with retail operations of wine in 1985, and liquor in 1987.

    West Virginia privatized liquor retail operations in 1991.

    Both states earned less than $20 million each. Operational costs were greatly reduced, but the expected windfalls never materialized.

    In 1986, $71.6 million net profit was sent to Iowa coffers. In 1987 – $43.6 million. Cash flow did not return to pre-privatization levels until 2004. They chose to retain wholesale operations, because they would have lost $60-70 million/year.

    In 2004, Maine picked up a quick $125 million for a 10 year lease of their wholesale operations, but since, has lost over $100 million in profits due to revenue sharing with the wholesale distributor.

    In 2012, we know that Washington was also dreaming billions. They only earned $150 million for wholesale rights, $30.8 million for their existing stores, and a new liquor/wine/beer license only costs $166.00.

    Last month, the governor’s windfall estimate was $1.6 billion. Today it is $1.0 billion. He is going in the right direction. But ironically, the governor’s billion dollar number and the real market comparables are both deal killers.

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