When small business uses the regulatory cudgel 

Big Government typically serves to protect Big Business from smaller competitives. I've written dozens of columns and two books about this. But sometimes the opposite is true: government intervention benefits the small guys.

Today's example: Blue Laws in Connecticut.

One lobbyist for small liquor stores, Carroll Hughes, has been fighting for decades to preserve the state's restrictive laws on alcohol sales. You can't buy beer, wine, or liquor after 9 pm or on Sunday (I remember visiting friends at Wesleyan during college, and the limit was 8 pm). Or as the Connecticut Mirror describes Hughes's work on behalf of the package stores: "Hughes is trying to get them another year of not facing pressure to open on Sundays."

Here's the meat of the fight:

Sen. Andrew Maynard, D-Stonington, an opponent of Sunday sales in years past, is ready to vote in favor.

He said he understands that opening on Sundays is a burden for small package stores, who will lose beer sales to supermarkets if they choose not open for a seventh day.

But Maynard said he no longer can accept the argument that small package stores deserve protection that is not afforded to small sporting goods stores, who compete with big-box retailers.

Got that? Supermarkets are already open on Sundays and late at night. Selling booze during those hours has very little marginal cost for them. Staying open longer has much greater marginal costs for the package stores. If you consider that many of these package stores are family owned and run, adding new man hours can mean significant new labor costs. The alternative is ceding Sunday and late-night hours to Stop & Shop -- which could permanently alter shoppers' habits.

Some other interesting details from this piece: The blue laws are "supported by the unionized drivers for the region's beer wholesalers. More package stores mean more driving routes, and that means more jobs."

Finally, there's this bit of regulatory robbery by the small guys that has since ended: "The minimum-markup law, which limited competition on price, was repealed in 1981 after a five-year fight by Hughes."

Another recent example where small guys benefit from undue government involvement: the cap on economic damages for spills from Gulf oil rigs.

I'm all for small business, but not when we have to take away people's freedom in order to prop them up.

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Timothy P. Carney

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