Re: Re: Re: Election soon in Ontario - alien kitten eater looking better
Thanz said:
Just regarding the LCBO - I think that the LCBO kicks some serious @$$ and there is no way it should be sold off for some quick cash to make a government's books look good for a year.
Shouldn't you wait and see what deal was made before you complain about it being sold off for 'quick cash'?
Right now, LCBO profits go back into govenrment coffers. However, if its sold (for a decent price), the money can be used to pay down part of the debt (or, if its sold after the debt is removed, the money can go into investments, etc.) So, not only would the sale make the government's books look good now, it would have a longer term impact. (That's assuming the government doesn't blow it on day-care programs, or short term frivilous projects.)
Thanz said:
The service that I get at the LCBO is second to none. They will order in to any location any product that is in its listing at no additional charge. The new stores have great services and programs (like cooking classes and wine tastings) that further enhance the experience.
Glad to hear that you're so happy with LCBO services. (Remember, it was only a few short years ago that they didn't even open on Sunday.)
Glad to hear that you're so happy with their service. But, not everyone is so pleased. Many wine growers in Ontario are upset because they can't get their products listed with the LCBO.
Now, you pointed out their special programs. Guess what? You're paying for those programs out of the higher prices that you pay at the LCBO. (So people who don't use them subsidize those who do.) And why do you think that those programs will disappear once its privatized? (2 stores that I use regularly... PetSmart and Home Depot, have courses at them too, and they aren't run by the government.)
Thanz said:
The LCBO makes money for the province - it is not a fiscal drain in any way.
I never said it was a drain. But, the markups mean that booze costs more than it should. (more on that below)
Thanz said:
As for prices, most of the price of beverage alcohol is tax. That will not change in a new regime. And any new private regime will not have the same sort of purchasing power as the LCBO - which is the single largest purchaser of beverage alcohol in the world. If they can't get a "volume discount" from alcohol manufacturers, no one can.
Lets look at some figures here...
- In 2001-2002, the LCBO had 2.9billion in sales, and had 900million profit.
That's a profit of around 30%. Hey, maybe taxes account for the remainder of the 70%. But a 30% rate of profit in any other industry would cause a lot of complaints. (Remember, you are paying for that when you go to the LCBO)
- Now, that's just profits. There are some very high costs associated with There are a lot of people earning a lot more money than they should from the LCBO... Many beaurcrats earn over 100k per year, the 'regular' employees are unionized and earn much more than a regular retail employee would, and they've spent a lot more money renevating stores when they didn't need to.
Now, you mentioned the LCBO has this 'purchasing power' because it buys in large quantities. However, there is no reason to believe that a privatized LCBO (whether it is kept as a large scale corporate entity or set up as smaller chains) cannot also get bulk discounts. (Whether you buy 1 million or 10 million bottles, you'll probably get the same discount.) In fact, depending on the terms of sale, you could still have the province buying the booze, but relying on privatized companies to sell it.
(Even if there were "volume savings", they'd have to be pretty remarkable to make up for the 30% profit markup. Especially if, as you said, most of the price is taxes.)
Thanz said:
In terms of "why alcohol? why not groceries?" the answer is simple. Alcohol is a legal product, but only to non-intoxicated adults. The LCBO, as a government run entity, has no profit motive that may cause them to sell to these individuals. A private retailer would have such an incentive.
I suggested groceries (actually I could have suggested any product) as a counter to the argument "why sell of something that makes money". (Legal restrictions were not a concern in this argument.)
Now, lets look at your claims...
- "The LCBO (as a government entity) has no profit motive". Have to disagree here... There is a profit motive. If the LCBO looses money, there is a greater chance that the government will sell it off. That is the profit motive.
- Even if there was a "profit motive" for a private LCBO to sell to people it shouldn't, there is a strong dis-incentive... namely, the government could impose fines and/or remove liscences for selling illegally
- And lets face it, the people running it are not the ones responsible for the actual sales, it is the rank-and-file clerks, who get their paycheck whether they sell or not; they don't work under any profit motive.
Thanz said:
Basically, I see many reasons for Ontario holding on to the LCBO and no reasons for selling it.
Now, frankly, I don't know if its a good idea or not. Guess what? I would want to wait until I saw the terms of the sale before I came to a conclusion.
For more information, see:
http://www.grapegrowersofontario.com/thepress/news_views/0902_milklcbo_cashcow.html
http://www.canadiangrassroots.ca/sections.php?op=printpage&artid=2885
(I just found these in a quick google search.)