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Brudesandwich OP t1_j3u55k0 wrote

Reply to comment by Blakkaman in Gov. Murphy proposes ending NJ's cap on liquor licenses. by Brudesandwich

There is a proposed tax credit for people with "old" licenses to make it somewhat fair.

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kevshea t1_j3v0spp wrote

Also, he's proposed relaxing the license cap over time, which will stop current ones from becoming worthless. You can imagine that if anyone paid a million for one today and tomorrow they said "lol actually anyone can sell booze", it'd immediately be worthless and they'd be out the full amount.

But its value is essentially in government-mandated lack of competition, driving up prices for all of us, and if competition is allowed to ramp up slowly then they'll still capture benefits of having the license, slowly decreasing each year. It'll be worth less than they anticipated, but not necessarily by a ton (if it were phased out over, say, 30 years). The tax credit could hopefully make up the difference relatively cheaply.

That said, yeah it's pretty terrible and causing a great deal more loss for the whole state to maintain this system than it would cause to the restaurateurs or whoever to tear it down. I'm for moving fast, breaking things, and maybe offering partial compensation to the current cartel beneficiaries.

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SyndicalistCPA t1_j3w4kxq wrote

On top of that, they've enjoyed years of limited competition.

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Jahooodie t1_j3wjbp1 wrote

In before this sub's capitalist fat cat apologists come to this thread with "well the market is the market"

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Blecher_onthe_Hudson t1_j3xpciq wrote

Big difference between Capitalism and 'rent seeking', though the rent seekers spend a lot of effort trying to blur it.

My favorite podcast episode ever is 2 academic Libertarians arguing about whether Capitalism is inevitably corrupt and devolves into crony capitalism, and after an hour they basically gave up and conceded. They said any corporation that grows large enough reaches a point where the next dollar is better invested in "rent seeking", (e.g. buying influence, market protection and subsidies), rather than just growing their business. Any CEO who didn't do it would be replaced by the shareholders, or the company would be bought by investors recognizing it was "underperforming". Of course being Libertarians, their only solution is having a government so small that it can't hand out goodies. https://www.econtalk.org/michael-munger-on-crony-capitalism/

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