Do we need antitrust action against “big alcohol”?

The argument here will be familiar to many MR readers, and it now appears in a Bloomberg column of mine.  Excerpt:

I say this as a longtime advocate of abstention, so make of it what you will, but: If Southern Glazer’s actions are limiting the supply of alcohol and boosting its price, then so much the better.

There is an overwhelming body of evidence that drinking alcohol leads to more traffic fatalitiesreduced productivity and higher rates of violence, not to mention the unquantifiable cost in ruined lives. Legal prohibition of alcohol proved unworkable, but some of the benefits of reduced consumption can be gained by allowing prices to rise and to stay high. One NIH investigation estimated the costs of alcohol use amounted to 2.6% of US GDP.

If a monopoly has some positive social consequences, all the more reason to let it persist. I would also be pleased, for example, by a monopoly in non-medical marijuana.

There are many instances of unlawful monopoly power in market economies, and most of them are best ignored. The FTC, like most parts of the government, does not have unlimited resources.

There are numerous other arguments in the piece.



Add Comment