It has been almost two weeks since the Liquor Control Board of Ontario (LCBO) workers have gone on strike. Their union, the Ontario Public Service Employees Union (OPSEU) is demanding job security for its workers (70 percent of which are casual) and greater assurances against the privatization of alcohol sales.
As privatization looms, many of the typical corporate talking points are being used to explain why opening the alcohol market would benefit all Ontarians. These generic talking points are frequently disseminated by journalists like Robyn Urback. In a recent opinion piece for the Globe and Mail, Urback references many of these tired talking points. As socialists, it behooves us to address the talking points and strategies frequently utilized-sometimes tacitly- by reactionaries.
Don’t mention healthcare
Urback begins the article by delving into the history of the LCBO. She waxes on about how the LCBO’s intended purpose, as a state control on alcohol because of concerns arising from the temperance movement, is no longer required. I bring this up as an example of the lengths reactionaries will go to divert around issues that do not support their cause. In framing the article in this way, Urback ignores one of the main reasons OPSEU is striking: privatization. She frames the issue as the workers trying to maintain their monopoly. By using this tactic, she conveniently ignores how Ontarians benefit from the LCBO versus other options. In framing the issue in this way corporations are trying to negate the benefit of the LCBO revenues to Ontarians. The LCBO generates $2.5 billion in yearly revenue that goes to the public coffers. This money is used to fund services such as health care, education, and infrastructure.
In a manner of speaking, every time you purchase something from the LCBO there is a kickback that is returned to workers. Urback and her ilk focus on the monopoly to incite fear of universal public services, painting them as inefficient and socialistic.. The LCBO is far from a Bolshevik beer store or a Wobbly wine dispensary. Yet, Urback fears this because the reality is that the LCBO has a core efficiency that comes from a centralized, state-run operation that cannot be replicated by the free market.
The cost of competition
Policies emphasizing markets are always based in language emphasizing the benefit of competition. Urback rejoices at the thought that the public has gotten a taste of the free market and therefore OPSEU will not have the sway to strike in the future. Free market ideology relies on an idealizes version of competition. The reality is that privatization would not reduce prices, nor increase selection. It would result in less choice and diverting public revenues to private pockets. Privatization would also come with a big upfront cost to the public . Doug Ford released his plan to open sales to more than 8,000 grocers. Additionally, the plan will allow these other stores to have a 10 percent discount off the LCBO retail price and a rebate on the LCBO’s “cost of service fees” for wholesale beer sales. Noting that workers benefit from LCBO revenues, what is the cost for a taste of freeing up the market. This Tory plan will cost, if you believe the Premier’s office, as little as $100 million; if you believe Bonnie Crombie, it may cost as much as $1 Billion. Rob Ferguson and Robert Benzie, writing in the Toronto Star, estimated that the total cost will be around $600 million.
Not included in these figures are the losses that the LCBO will face from lost sales. Unsurprisingly, the vast majority, about 80 percent, of the LCBO’s revenue comes from the retail stores. Ford’s plan will directly attack these sales. Urback, indicated that the desire is for the LCBO to be a wholesaler for the benefactors of this privatization campaign. In that scenario, a large portion of that 80 percent—if not all of it—will disappear, drastically reducing what goes towards infrastructure and healthcare.
Free market utopia
Ford argues that increased privatization will bring more convenience and lower costs for everyone through competition. Urback alludes to this by pointing to the fact that citizens can simply bypass the strike by popping by a grocery store. Although it may bring some convenience, by providing more places to purchase alcohol, the benefit of convenience does not make up for all the negatives. At first buying alcohol from places besides the LCBO may appear more accessible and in some cases cheaper (although probably not). Over time the reality is that all workers will lose out, having to shoulder the cost of lost revenue going to the private retailers. Even the appearance of a cheaper price will not last long as a result of capitalism’s trend toward monopoly. In this case, the corporations that will be included in this process already have the market cornered as an oligopoly. In 2022, Loblaws, Sobeys, Costco, Metro and Walmart controlled approximately 80 percent of the total Canadian Grocer retailer market. The top three (Loblaws, Sobeys and Costco) control 61 percent of the total market. In the first quarter of 2024, amid claims of price gouging, Loblaws alone made $9.4 billion from the company’s grocery sales.
Why would it be any different now that alcohol sales are going to be included? The answer is, it won’t. If anything, as these companies grab shares of different markets, this will only get worse. Unfortunately, unlike LCBO, much of this revenue went to shareholders.
These ships won’t be sunk by iron alone
Of course, these efforts are primarily aimed at the workers themselves. Again,Urback hopes that with the government’s efforts, this will be the last LCBO strike. As the mouthpiece of the corporations, her concern is not monopoly, but an industry where workers have the power to stop production. By making the alcohol market more “competitive” the hope is that OPSEU’s ability to fight will be diluted. The concern about the monopoly that Urback references is one where workers have more means to accessing the profit that they have producing. They hope that OPSEU’s strike will be undermined otherwise it may cause the tides to rise.
They hope our ships are all sunk under the iron law of wages. This fear is warranted because OPSEU has the support to win all their demands. Whether it be at picket lines, postering or in everyday conversations, we should take every opportunity to support these workers and take the opportunity to combat tired conservative talking points.
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