Grocers Challenge Alko’s Legality
This is some of the best news I’ve heard in a while – From YLE…
The Finnish Food Marketing Association has challenged the authority of Finland’s state alcohol monopoly Alko. It has taken its case to the European Union, saying that the monopoly is illegal.
The newspaper Aamulehti reports that the Association has demanded that the European Commission investigate the legality of Alko’s hold over the wine and spirits market.
The Association also suspects that Alko has unfairly used its position as the only liquor retailer. In addition, the organisation challenges the logic of the monopoly, saying that consolidating alcohol in the hands of state retailers has not prevented the rise of alcohol-related social ills.
Just wondering, do any of you actually believe that Alko should be able to keep its monopoly? Why on earth wouldn’t anyone want 1) cheaper prices 2) wider selection 3) wider availability?
Mr. X has commented about this before, have a look…
I am not for monopolies in general, but would like to tell you Phil one good reason why f.ex. drugs arent legal and why there are gambling and alcohol monopolies in Finland.
The reason is that the cost of the treating people with problems related to the things just mentioned are paid (in Finland style welfare state) by the state (all the tax payers). As long as this is the case, there is a reason to limit the use of alcohol etc. If everybody who has a problem would pay for the reatment etc themself, there wouldnt be a problem.
Comment by Lauri — Thu, Feb 3rd, 2005 @ 11:19 am
But does Alko really limit the use of alcohol??
Comment by Phil — Thu, Feb 3rd, 2005 @ 11:31 am
No it does not and that’s why this marketing association has good case, I think. I hope. I always found it curious that the state monopoly could be kept by pointing out the problems in Finland and that it was defended (in Brussels) through statistics showing that the average use per capita in Finland is quite low. Is there a problem or not? Well, I know. I can see it with my own eyes. Alko has not and never will prevent that. As long as it is ok for the majority to see drunks on the street and kids with bottles, Finland will keep it’s problem. Society needs to change attitudes. Alko obviously doesn’t.
Comment by Beaver — Thu, Feb 3rd, 2005 @ 11:54 am
Well this one is very simple. As you said Phil, competition would lower the prices. And as the prices fall, the consumption (and mostly the non-wanted consumption) goes up..as we have seen after the alcohol tax cuts last year.
Of course attitudes etc need to change, but still, as long as the state keeps financing all the extra treatment, extra police needs, etc, the state has a very good reason to try to limit the use of alcohol.
Comment by Lauri — Thu, Feb 3rd, 2005 @ 12:20 pm
No, that’s not correct. You could tax the alcohol as well. There’s no other reason for a monopoly, except the fact that the state gets huge profits from it.
And the cultural aspect is screwed exactly because of paternalism. Or tell me, Lauri, why is it that exactly all the health-fascist countries that have alcohol monopolies are exactly the ones with the most problems?
You don’t think people have ways of coming up with moral and reason if the choice is left up to them? I say the numbers are against you.
Comment by Toni — Thu, Feb 3rd, 2005 @ 12:39 pm
Some try to blame it on the cold weather and dark days, but I don’t buy that. It should turn me into a heavy drinker and that never happened.
Furterhmore, what Lauri says (that the state has a good reason) might be true, but they have had this reason for decades and Alko was their solution. They failed. Time for something else. Can’t you see that?
Comment by Beaver — Thu, Feb 3rd, 2005 @ 1:01 pm
Of course you can tax the alcohol, but that doesnt help with problems regarding supply, (too easy) accessibility, etc. factors, which contribute to the (wrong) use of alcohol.
Of course you can regulate those thing also, but the costs of monitoring and developing the control system are higher than the benefits from competition.
And as I said, one reason for the monopoly is to collect the profit to the state’s pocket.. exatly for the reasons mentioned earlier: the state has to take care of the problems.
Its very much the same problem like with slot machines: Norway liberated the market and tried to regulate it, while Finland stayed with its monopolies. The outcome: the problems relating to gambling in Norway have risen so high the state is trying to monopolize the system all over again. And with the peoples backing.
And regards to “why is it that exactly all the health-fascist countries that have alcohol monopolies are exactly the ones with the most problems?” there is a simple answer also: the countries with the most problems have become health-fascistic.. so its a consequence of the problem, not the other way around.
Comment by Lauri — Thu, Feb 3rd, 2005 @ 1:23 pm
Remember though that the left will be completely oblivious any facts presented – they’re going to want the government to control Alko (and just about everything else) no matter what.
Comment by Phil — Thu, Feb 3rd, 2005 @ 1:25 pm
Beaver, ok, alcohol policies in Finland have not worked like planned, but i just cant see how competition in the alcohol market would solve anything. Look at Denmark for example, they have much more liberal laws and the problem drinking has risen to new top levels.
Comment by Lauri — Thu, Feb 3rd, 2005 @ 1:26 pm
Phil, i just cant see why you feel like the government would like to do anything more than it thinks its best for the country? Still you know that the government represents more or less the people. And the people want monopolies in gambling and in alcohol supply, why cant you respect that? I think you should if you believe in the “free choice of the people” (which has chosen not not give freedom for everybody to drink everywhere at any time at market prices)
Comment by Lauri — Thu, Feb 3rd, 2005 @ 1:30 pm
C’mon man, don’t be so naive.
Yeah, that’s what they teach you in high school civics class but you quickly learn that this isn’t true.
Is this true? Do the people want monopolies? I’ll believe it after the people actually get to vote specifically about the issue.
Like I said, I’d like to see the citizens of Finland vote on this issue. I’ll be sure to bring up your reasoning when someone complains to me about George Bush. Americans have spoken and they chose Bush, so I guess the rest of the world should shut-up about it??
Comment by Phil — Thu, Feb 3rd, 2005 @ 3:12 pm
Well i really think that the people in our government really want to make right decissions (which the people like). Because there arent many influental interest groups here in Finland, the country is least corrupt in the world, and the ministers etc dont get any big salaries from politics, and so forth, i really do feel it is possible that the ministers try to act “as good as they can”.
And yes, its true. About 75 % want RAY and Veikkaus to keep their monopolies because of two things: the money goes to good purposes and the negative side effects can be dealt with more effectively. With regards to Alko I dont have the numbers, but to my recollection people also want to keep the monopoly going.
With regards to USA, yes and no. I feel that so many people in the US are so bad informed about things, its hard for them to make the choices they “really” prefer. So i cant be mad at the US citizens because they havent been thought thing about the world. You werent angry towards the iraqi people when they gave 100 % (or was it 102%) of the votes to Mr. Hussein.
Its very much a spplitted country, the US, and i really feel that there is an awful lot of goodness there, so i couldnt be angry with the whole nation.
Comment by Lauri — Thu, Feb 3rd, 2005 @ 3:42 pm
..and naturally i didnt want to compare us and iraq, but still: 25 % of college stundents thought in 1996 that Bob Dole was the owner of Dole Pineapples and didnt have a clue about him beeing the presidental candidate.
Comment by Lauri — Thu, Feb 3rd, 2005 @ 3:46 pm
I think you’re mixing two things up, Lauri. I also feel that many, perhaps a majority wants to keep gambling and liquor stores in the way it is. But not because of the reasons you say. I think it’s because they all are afraid of changes and like all things the way they are. Just imagine if we would be talking about education, public health care, infrastructure, etc. Nobody wants change, everything is fine, even when in fact it’s not.
And sure, now there are dedicated funds to help those with an addiction, but to me it’s like the fire department starting their own fires.
For the moment I think that the (high)taxes on alcohol should be used to help those with a problem. I see no need for a state monopolist store and the principle is just wrong. Otherwise: where are the state harddrug stores?
Comment by Beaver — Thu, Feb 3rd, 2005 @ 4:33 pm
Please note Ladies and Gentlemen, the USA (and Canada) has alcohol monopolies called ABCs.
Comment by Philip — Thu, Feb 3rd, 2005 @ 4:48 pm
It seems i think more of the finnish people tha you do, Beaver. I fell that vast majority of the finnish people have an own opinion about why hte gaming and alcohol monopolies should stay in place. (btw. the support percentage for Alko was 80) .. People want chance, thats what everybody talks about when it comes to taxation, health care, etc. So i dont think its just rejecting any chance, i think its really about picking the best (or the least) worst) model. And it really seems that people (wisely) see that in some areas state ownership isnt such a bad thing all aspects considered.
Comment by Lauri — Thu, Feb 3rd, 2005 @ 5:29 pm
ok, sorry for all the spelling errors, i am little bit tired
Comment by Lauri — Thu, Feb 3rd, 2005 @ 5:31 pm
Philip, what are ABCs?
Comment by Phil — Thu, Feb 3rd, 2005 @ 6:08 pm
There are other concerns though, if and when Alko would lose it’s status. I am just afraid that it would do no good to both the pricing and even the range of products. Supermarkets are never going to import a nice range of beers, they will only make place for the same brands of hiher alcohol percentage. I also don’t see suddenly all kinds of nice small liquor store with their own unique range of products. Perhaps I also say that ’cause I live in Lahti, where there isn’t any “nice small” shop…
Don’t worry about spelling and grammar here. Ususally I need to write down things a second time to make myself clear
Comment by Beaver — Thu, Feb 3rd, 2005 @ 7:56 pm
“Supermarkets are never going to import a nice range of beers”
Why not? They import a nice range of beers now. Unfortunately most of the “good beers” are about this 4.7% limit – they’ll replace some of their crappy >4.7% beers with “better beers” and expand.
Comment by Phil — Thu, Feb 3rd, 2005 @ 8:09 pm
I strongly disagree. We cant have all the things at once (low prices, wide selection and high availibility) unless alcohol consumption grows to fund the evolving. Increasing consumption increases cost to the state and to compensate the costs its nessessary to raise taxes.
Comment by Pekka — Fri, Feb 4th, 2005 @ 9:29 am
Exactly right, Pekka.
Comment by Lauri — Fri, Feb 4th, 2005 @ 12:30 pm
In Finland, back in the 70′s, you weren’t able to by any beer in normal shops, right? Did all hell break loose once they allowed the typical shops to sell beer?
Comment by Phil — Fri, Feb 4th, 2005 @ 1:23 pm
No because they waited long enough for people to be enlightened.. =)
Comment by Lauri — Fri, Feb 4th, 2005 @ 1:48 pm
“We cant have all the things at once (low prices, wide selection and high availibility) unless alcohol consumption grows to fund the evolving.”
Well, “wide selection” and “high availability” would definitely happen by de-monopolizing Alko. You’ll see alcohol speciality stores popping up around Finland where you can get finer wines, beers, and spirits. We have a ton of these types of stores in the states, even with beer and wine sold in the normal shops of many states.
…this will have no effect on the consumption of alcohol in Finland. It’s only the “low prices” that could spark a temporary increase in alcohol consumption. But like last year’s tax breaks, the spike in drinking calms down. Even if there is a few percentage points raise in the consumption, big deal. Why should 99% of the population be punished with high prices just because 1% of the population might drink too much??
Comment by Phil — Fri, Feb 4th, 2005 @ 2:58 pm
“..high availability??¦this will have no effect on the consumption of alcohol in Finland” –> not true, all the research papers concerning this matter suggest that after price, availability is the second biggest factor in the demand for alcohol. ALKOs presence always add to the consumption level in remote areas.
“Even if there is a few percentage points raise in the consumption, big deal. Why should 99% of the population be punished with high prices just because 1% of the population might drink too much??”
This is a good question. I think nobody has the answer because we all have different views about how much we should take other peoples possible problems into consideration when making this kind of decissions.
Comment by Lauri — Fri, Feb 4th, 2005 @ 4:02 pm
Phil, you said: “You???ll see alcohol speciality stores popping up around Finland where you can get finer wines, beers, and spirits.” I don’t believe that at all. Think of the taxes that went down for the imports of second hand cars. Who is importing and selling them now? New, small businesses? No. Bigger, already existing car dealers. That’s how this will go as well (if it will happen at all). It’s a shame we have no countries to look at for comparison? Or do we?
Comment by Beaver — Fri, Feb 4th, 2005 @ 5:11 pm
The reason is that the cost of the treating people with problems related to the things just mentioned are paid (in Finland style welfare state) by the state (all the tax payers). As long as this is the case, there is a reason to limit the use of alcohol etc. If everybody who has a problem would pay for the reatment etc themself, there wouldnt be a problem.
Comment by Lauri ??? 3.2.2005 @ 11:19 am
But this doesn’t make any sense. I’ve lived here for nearly 5 years and I haven’t seen very many sincere attempts from the government to reduce alcohol consumption. In fact, even responsible Finnish adults with families and careers put a lot of pressure on people to drink during camping trips, sauna, etc., and if you refuse you’re considered rude and wierd. From what I can see, alcoholism here is simply viewed as a reality that can’t be changed.
“Well this one is very simple. As you said Phil, competition would lower the prices. And as the prices fall, the consumption (and mostly the non-wanted consumption) goes up..as we have seen after the alcohol tax cuts last year.
Of course attitudes etc need to change, but still, as long as the state keeps financing all the extra treatment, extra police needs, etc, the state has a very good reason to try to limit the use of alcohol.”
Comment by Lauri ??? 3.2.2005 @ 12:20 pm
But if Finland really wanted to reduce alcohol consumption, wouldn’t they just make it illegal? (haha I know that’s impossible- it is maybe the only thing that would ever cause a revolution here)….but seriously….the logic of your points seems to be that the Finnish state is raising money from the sale of products (booze) that funds welfare state services used to treat problems caused by those products. It’s a vicious circle.
Comment by a reader — Thu, Feb 10th, 2005 @ 10:14 pm
Or better yet – do the people who oppose lower-prices of alcohol and the de-monolopization of Alko believe that the current situation is PERFECT? I mean, they don’t want the prices lowered, but they don’t want them raised either – so I guess everything is just *PERFECT* the way it is now….right?
Comment by Phil — Thu, Feb 10th, 2005 @ 10:38 pm
No situation is not perfect. As I said before:
“Beaver, ok, alcohol policies in Finland have not worked like planned, but i just cant see how competition in the alcohol market would solve anything. Look at Denmark for example, they have much more liberal laws and the problem drinking has risen to new top levels.
Comment by Lauri ??? 3.2.2005 @ 1:26 pm ”
I know its tempting to find a simple solution like “lets make it illegal” or “let the markets do it all”..but the fact is that it is more complex (people want to be able to drink alcohol AND people know that it must be controlled in some way or another to avoid problems)
.. sorry if this is news to you.
Comment by Lauri — Fri, Feb 11th, 2005 @ 12:47 pm
Take your time to take a look at the pages dedicated to…
Comment by store — Wed, Oct 5th, 2005 @ 1:47 pm