Big Alcohol’s Monopoly Isn’t Worth Breaking Up
If higher prices for wine and spirits mean that fewer people will drink, then society will reap the benefits.
So what if it costs a lot?
Photographer: Brandon Bell/Getty Images North AmericaSometimes monopolies are best left alone. That’s often the case when they aren’t harming consumers, but it can also be true when they are — for example, if their product is unhealthy, for customers and society, and higher prices mean people will use less of it.
The Federal Trade Commission is said to be preparing a lawsuit against Southern Glazer’s Wine and Spirits, on the grounds of price discrimination under the Robinson-Patman Act. The premise would be that the company, which is based in Florida and distributes alcohol in 44 states, is charging higher prices to small retailers than to large chain stores, which may be keeping small retailers out of the market and limiting supply. The investigation has been going on since at least last year.