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October 07, 2006

Public Drunkenness

Public drunkenness
Why the NB Liquor Corporation is a good model for other firms.
www.herenb.com

The recent record profit posting by the New Brunswick Liquor Corporation indicates more than the province is full of winos; it should be a sign to politicians and economists that public ownership of key industries is a sensible and efficient strategy.

In 2005-2006, the public enterprise generated $344 million in sales, a $13 million increase over the previous year. Positive growth in booze sales, especially wine, combined with internal savings resulted in transfers to the province of over $123 million, not including taxes. This money is used for various social programs and other public goods.

"There has been a big change in how the corporation has been run over the past eight years," said Brian Buckley, President of Canadian Union of Public Employees (CUPE) local 963 who represent around 290 liquor store employees across the province. "The look of the stores has become a lot more professional, we have classier uniforms and the staff are better trained than ever," said Buckley a 28 year veteran of liquor store life.

"We have to be efficient," said Buckley, during an 11 p.m. interview after putting in a 14 hour day. "Otherwise, they'd turn us over to private enterprise."

New Brunswick's new government, like its predecessor, has no plans to privatize the company: why mess with a good thing, especially when it's heaping cash into government coffers?

"We have found new efficiency in our organization," says Paul Harpelle, public relations director for the liquor commission and - in classic small world New Brunswick fashion - Brian Buckley's former boss. "We are saving money on issues like shipping, so expenses won't chew into our profit margin," said Harpelle.

Currently, there are 51 corporate NB liquor commission stores and 71 smaller agency outlets operated by private businesses.

Larger entities like the liquor commission can purchase products in bulk, and create economies of scale in their shipping and distribution networks making them more profitable than smaller dispersed private stores. Unlike private business, the profit from the liquor stores benefits the many, not just the few.

And, in other good booze news, red wine from Australia, France, Spain and - this writer's personal favourite - Italy, is leading sales growth, increasing by 6.9 per cent, showcasing that good taste and a bit of romanticism haven't passed New Brunswick by.

Bar-room know-nothings of the 'every man for himself' variety and their intellectual backers might wonder why full-time unionized liquor store employees ought to earn around $16 per hour when folks flipping burgers or working regular retail are paid minimum wage or close to it?

Well, there are two reasons: firstly an issue of basic human dignity, no one should have to work full-time and live in poverty, the ever present reality for many low wage service sector and retail workers. Secondly, and this one should be of interest to the Conservatives out there, paying people better and providing stable work environments generally results in better service and increased efficiency.

If something as important as booze can be publicly administered, why not run other activities in similar fashion? "Things that we need, like insurance, could run publicly," said Buckley. Insurance is an especially good example and not just because of profit gouging by an increasingly greedy industry. The majority of profit in insurance doesn't come directly from the premiums people pay, but from investing those premiums. If this investment capital was controlled collectively, it could be used for profitable projects that also operate in the public good, or at least outside the auspices of private tyranny.

On the insurance file, even the Gordon Campbell's BC Liberal government, free-market extremists who follow reactionary economic doctrine with the same fundamentalism the Taliban use to interpret the Koran, have backed away from Privatizing ICBC, the Province's public insurance provider.

As insurance costs in other provinces spiral out of control, B.C.'s (neo)-Liberals decided privatizing insurance wasn't worth the political backlash.

Despite the best rhetoric and fear-mongering from the right, arguing for public ownership of key industries isn't a call to rebuild the Berlin wall.

The old model of socialism has fallen: along with liberalism, fascism, old school colonialism, free-market industrial capitalism and the other grand twentieth century narrative.

Countries and communities around the world are experimenting with new models of ownership: factories controlled by the people who work in them, forests managed by local residents and unique mixes of public and private ownership, based on practical efficiency and decency, not long dead stagnant-ideologies.

On the themes of decency and efficiency, may I propose a toast: to public control over booze supply. Drink up New Brunswick, the money you spend on fine wine will come back to you in the long run.


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