Gas, Booze and Feral Swine

Member Group : Lincoln Institute

State government is facing another difficult budget, a critical junction in the liquor privatization debate, a looming pension crisis along with crumbling roads and bridges. So it provided a bit of comic relief at a recent gathering of the Pennsylvania Press Club when Senate President Pro Tempore Joe Scarnati was asked to comment on state regulations regarding feral swine. This had nothing to do with the public’s apparent view of government, but rather the concerns of agri-business in the senator’s rural home district.

For his part, the top senate Republican sought to deflect attention from current pressing issues by talking about the past. In his prepared remarks Senator Scarnati lauded the success of the state’s approach to acquiring more revenue from drillers in the Marcellus Shale gas region. A new law requiring an impact fee (a euphemism for additional taxes) seems to have struck a delicate balance between obtaining that revenue while not making continued development of the resource unprofitable.

To some degree the senator is correct about the success of the legislation. Nobody is really happy about the law, but everyone can live with it. Energy companies are now paying a tax not required of other businesses in the state, but there is a general feeling within the industry that it could have been much worse. The spending interests got additional revenue, although they feel the energy companies should pay more. Townships got financial help in dealing with the impact on infrastructure of gas development, but ceded – perhaps unconstitutionally – some of their zoning power to the state.

Senator Scarnati told the assembled media that it took two years for the state to "get it right" on Marcellus Shale, and that it shouldn’t be expected to do the same on liquor privatization in just a few weeks. He was referring to Governor Tom Corbett’s desire to accomplish reform of the state’s Soviet-style liquor system by the end of June. The senator, however, was engaged in spin. The current liquor debate began years ago when House Republican Leader Mike Turzai assumed his leadership post and pronounced it his top goal. Incoming Governor Corbett stated the same. Thus, the senate has had two and a half years to gear up for a vote on the issue.

Turzai accomplished one of the greatest legislative feats in recent state history by getting a reasonable liquor reform bill through the House. It has landed in the lap of senate Republicans who view it as the political equivalent of Kryptonite. And they have good reason to be wary. Liquor privatization has overwhelming public support and is a top priority of a governor badly in need of a political win. If Senate Republicans kill the bill, they will – despite Senator Scarnati’s assertion to the contrary – seriously wound the governor politically, alienate House leaders who they need to pass their own legislative agenda, and – worst of all – offend a large section of the electorate.

Adding to the political significance of the situation is the fact Republicans lost three state senate seats in 2012 and now hold just 27 seats in a 50-seat chamber. With all southeastern Pennsylvania GOP senators except Majority Leader Dominic Pileggi up for re-election next year the long standing senate Republican majority is in jeopardy.

The counterweight to liquor reform is, of course, the public sector labor unions. Many of the senators up for re-election next year have been heavily supported by those unions. Thus, on this issue, they find themselves torn among their constituencies. Nobody is on the hot seat more than Senator Charles McIlhinney of Bucks County. He chairs the Law and Justice Committee which is holding hearings on the bill. As such, he wields considerable influence over the outcome of the liquor debate. Internal Bucks County politics, including the fact one of the senator’s biggest supporters owns a major beer distributorship, has complicated the situation further.

This much is clear: liquor privatization will be a career defining – perhaps career ending – vote for some Republican senators. A failure to pass a bill that tops the legislative agenda of both the Governor and the House Republican Leader could be the equivalent of pulling the bottom card out of a house of cards. Failure on liquor reform will hurt the governor’s re-election chances; poison the well for legislative cooperation on other issues; alienate voters and perhaps bring about a crushing GOP defeat at the polls next November.

There could hardly be more riding on the outcome of this debate. Not just for senate Republicans, but for Governor Tom Corbett, the Republican Party and for the people of Pennsylvania who would like to see their prohibition-era system of wine & spirits sales finally brought into the 21st Century.

(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly Lincoln Radio Journal. His e-mail address is [email protected].)

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