World

A Canada Day lament for the homey, private liquor store

Neil Macdonald on the advantages of mom-and-pop liquor outlets.

My local wine and liquor shop here in Washington is Pearson's, an old, cramped joint that started out as a pharmacy 76 years ago. Back then, it sold booze by prescription, which was the only legal way during Prohibition.

Steve Silver, who took it over in 1976, advertises as "Plain Old Pearson's," a dig at his competitors, some of which feature real sommeliers and stupendous cellars. But I haven't found anybody more willing to joust for my dollar than Silver, so he gets it.

Buy a whole case at Pearson's, you get 25 per cent off. Buy his wine regularly and you get access to a stash of stuff in the back at an even better price. Want something special? Silver will negotiate.

The near-empty shelves at an LCBO outlet in Toronto in June 2009, just hours before a strike that was averted. (Canadian Press) ((Canadian Press) )

Plus, you can usually taste before you buy, gratis, "from nice glasses, not plastic cups." Silver also accepts returns, no questions asked. At Pearson's, it feels good to be a customer.

Lobster trap

Buying wine at Pearson's is the real American experience and a Canadian transplant can't help but love it.

So, evidently, do thousands of Silver's other customers, which is something he keenly understands. When he sold the shop recently, he sent out a message promising the new owners won't change a thing.

"The customer's needs come first," he declared. "Flexibility is supreme."

Well, good, I thought irritably, glancing at the TV monitor in my office. It is permanently tuned to CBC Newsworld and, as I read Silver's reassurances, images of panic-buying at Ontario's state-run wine and liquor outlets flickered across the screen.

If you tried to come up with the exact opposite of Pearson's, you'd inevitably design the Liquor Control Board of Ontario.

Last week, with a strike deadline approaching, the LCBO made off with its best one-day haul in history — $60 million in sales.

Until the strike was called off, Ontarians, with no more options than lobsters in a trap, had to stand patiently in line, carts piled with bottles, waiting their turn to pay whatever the LCBO felt like charging them.

Apologies, Canada

Watching from here, on my free-market perch, my sense of consumerism burned even hotter than usual. In fact, I get annoyed just thinking about the LCBO and its state-run Quebec sister, the SAQ.

Now, I admit, these are profoundly un-Canadian thoughts. But I plead human nature. I spent years shopping for wine and liquor in Canada and it was about as enjoyable as filling up a tank of gas.

When I came of age in Ottawa in the 1970s, the local LCBO outlet looked like a Soviet drug dispensary: a long counter manned by clerks who wouldn't deal with you until you filled out an LCBO form (using one of the LCBO pencils that dangled from the counter on strings) and marked down your selections from long, boring columns of listings.

There wasn't an actual bottle in sight. You'd pay (cash, of course), then wait to be handed your purchases in brown paper bags, packaged so as not to clink scandalously in public.

I am not making this up.

A tax machine

The LCBO has changed much since then, I acknowledge. For one, it doesn't try to make you feel ashamed anymore of buying booze.

And like its Quebec counterpart, it has added an upscale "Vintages" section, with a lively website that prattles on about how to pair food and wine.

But there are no bargains, as I was pointedly reminded during a chat with LCBO spokesman Chris Layton. Quite the opposite. Like most monopolies, Ontario practises blatant price-fixing.

"We have floor pricing," Layton told me. "Whether it's wine, spirits or beer, there is a minimum retail price. The idea is to discourage deep discounting."

That's because discounting is a business activity and the LCBO is not primarily a business. It's a tax collection machine — one that sent almost $2 billion to the Ontario government in the last fiscal year.

Understandable, I guess. Canada's social services are so expensive they cannot be funded by income tax alone, even at some of the highest income tax rates in the world. That is where the booze machine kicks in.

No Pinot for you

But the LCBO goes much further. It's a creature of big, paternal government and it's not until you move somewhere else that you realize just how overbearing it can be.

The liquor board blithely dictates Ontarians' drinking choices. A few years ago, it decided for a time to deny its customers almost all the excellent California and Oregon Pinot Noir wine being enjoyed by the rest of the world.

Asked about that, the LCBO's Layton in effect blamed the winemakers.

With demand for their product at an all-time high, suppliers weren't willing to knuckle under to the LCBO's demands for its usual volume discount. (The less the board pays for a bottle, the more taxes, markups and fees it can pile into the retail price).

So the LCBO simply refused to stock any of these wines, regardless of what its customers might have wanted.

Would you like a taste? Steve Silver in his now former wine and liquor store in Washington, D.C. (Louis Deguise/CBC)

Where the consumer is king

Layton, though, kept returning to the fact that his employer helps fund government services, which, in his opinion, makes Canada a better place than America.

He acknowledges wine and liquor can be much cheaper in the U.S., but "when I've been down there I've never felt as safe as I do here. A lot of people here look at it like that."

Further, said the LCBO man, the liquor board is protecting Ontarians from themselves.

"Basically the premise is — and there are studies to show this — that the cheaper the alcohol, the higher the irresponsible use is."

Then, he argued, there is selection. Ontarians enjoy knowing that "I've got a store that I can walk to that isn't just a mom-and-pop or convenience operation, but that is going to offer me 2,500 different products."

In the U.S., Layton said, "you have to go to three or four different stores to get a half-decent selection of products."

Well, that certainly hasn't been my experience here, but it's as good a PR spin as any.

I talked to Steve Silver, too, to wish him a happy retirement. He doesn't see any problem with mom-and-pop operations, being a pop himself. He also manages to offer about 2,000 brands.

But he concedes he's never been much interested funding the public treasury or obliging Washingtonians to drink less.

"We just tried to be right with our customers and hoped they'd love us, and I guess they did."

Now, some readers might find this column a bit rich. My employer, after all, relies on taxpayer support, although the CBC is hardly a monopoly.

But my job is to write about the differences down here and the difference between the LCBO and Pearson's is one of the big ones.

The LCBO is there, as its name suggests, to control something people enjoy. Pearson's is there to sell it.

The LCBO wants to protect you from bargains. Pearson's wants to offer you one.

At the LCBO, you're a taxpayer who has to be prevented from drinking too much. At Pearson's, you're king. And that's that.

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