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by amscanne
1485 days ago
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I suspect that for every well-run public corporation, there are a dozen that are bloated and wasteful, and should have died long ago. SaskTel seems like one of the good ones, but it’s not that way because it’s a public corporation. This doesn’t happen because people involved are less competent, it’s just that if they make some bad decisions or have some bad luck, they won’t be forced to answer to reality by the market by e.g. running out of money or being beaten by competition. Public corporations are too easy to keep going by continuing to fund through state coffers; to shut them down suggests that leaders made a mistake, so instead we throw good money after bad. It may not have been a mistake to attempt a public option, however even good ideas can fail for lots of reasons, and incentives just make it too hard to fail when it should. To me the LCBO is the shining example of this: any reasonable analysis that compares with private competition for alcohol sales (e.g. Alberta, BC) would find Ontario has much worse store coverage, worse selection and lower net revenue per unit of alcohol .. yet, no politician would dare visit such an idea, since it suggests government (and its leaders) and ineffective. The best thing would be to do a Yozma-style funding program. The government offers to match investment and provides clear buy-out terms for successful cases. If you lower the downside risk, you’ll get the competition you want in the space. |
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I grew up in Alberta. Privatization of liquor there happened just around when I turned 18. LCBO vs the typical Alberta "liquor barn" type operation is no contest: the LCBO wins. On selection, on service, on presentation.
There are just a handful of decent wine shops in Edmonton when I visit. Their selection is meh. Almost every decent sized LCBO has a "Vintages" selection with a decently currated selection of wines. They are actually the superior retail experience, and they treat their employees far better on the whole.
The LCBO is also the single biggest importer of liquor in North America last I looked. Many European producers actually produce special labels and product just for the LCBO, because it buys in quantity for all of Ontario.
Politicians don't dare visit privatizing it not because of the suggestion it might make them look ineffective but because the LCBO brings in an obscene amount of revenue.
(The wine industry in Ontario is actually something I know a lot about. The real problem here is the regulatory side of things, and also the regulatory capture that what I call the "Niagara VQA Mafia" has over the domestic wine market. Becoming a wine producer in this province is stupid, it's been locked down to the same handful of meh grapes in an essentially locked in set of growing regions with no room for innovation, and the gov't totally destroys you on excise taxes, etc. not to mention the cut the LCBO takes from you)