Prohibition or the 18th amendment was an act that was implemented on January 16, 1920, in the United States of America according to which any business related to intoxicating liquor such as import, export, transport, selling, buying, and manufacturing were declared legally prohibited. The basic purpose behind the implementation of this Act was to reduce the rate of alcohol consumption which would further improve the quality of life and economy and would reduce the increasing rate of crime, death due to alcohol, and poverty (Bowen, 1969). Thornton (1998) stated that the Act failed to achieve its intended purpose. Instead, it further aggravated the situation which it wanted to solve.
Historians have reviewed the Prohibition Act and have declared it ineffective since it was unenforceable. The Act led to the rise of several social problems, such as a massive increase in the rate of organized crime, alcohol consumption, murder, and corruption among city officials. Economically the country suffered under prohibition because the government did not collect any tax from the multi-billion dollar industry. In this paper, I aim to highlight the social and economic aspects of the prohibition, which shall be discussed in detail.
Social Aspects of the Prohibition
The prohibition led to the rise of alcohol smuggling. Bowen (1969) writes that the prohibition failed because the government could not control the massive flow of illegal liquor from different countries, including Canada. Illegal alcohol was smuggled from overseas, government warehouses, and was produced privately. There were only 1550 agents of the newly established Federal Prohibition Bureau, which was not sufficient for the 18,700 miles coastline, which made it easy for the bootleggers to smuggle alcohol into the country. The success of the bootleggers is evident from the fact that the government could not capture even 5% of the smuggled alcohol (Wenburn, 1991). Alcohol was smuggled in hip flasks, empty canes, or anything that could be found. There was an increase in illegal speakeasies, and by 1925, New York City had 100,000 speakeasies. Not only New York but all the major cities had speakeasies. In fact, under prohibition, the number of speakeasies grew twice the number of saloons closed due to the Act. The situation made bootlegging a very attractive and competitive market (Bowen, 1969).
Prohibition led to the rise in bribery. Wenburn (1991) states that the lucrative market of illegal alcohol fell in the hands of gangsters related to organized crimes. According to Bowen (1969), the gangsters secured their business by bribing high city officials. Many government officials and people holding important political posts such as mayors, judges, senators, governors, and Police Chiefs had their names written on the payrolls of the organized crime dealers.
Laws were violated under prohibition. Bowen (1969) states that it has been studied that alcohol consumption during the Prohibition period was higher than the pre Prohibition period. Not only laws related to alcohol consumption were violated, but its manufacturing, transport, import, and export continued. The price of beer rose since it had to be transported in large barrels. This change led Americans to drink less beer, but at the same time, they started consuming more potent alcohol, which was cheap and easy to transport. Thus the Americans got more drunk by drinking less. In 1920 the recorded number of deaths due to potent alcohol was 1064, and in 1925 the number was 4154. Arrests due to drunkenness and disorderly conduct increased by 41%, and drunken driving increased by 81%.
During prohibition, the products were made illegally and had absolutely no standard of quality. Since all the purchases and dealing of illegal products were made through the black market, there was no fear of lawsuits or publically defamation. Thus prohibition gave a free hand to the profiteers who produced sub-standard items and made money out of them (Morgan, 1982).
Another negative aspect related to prohibition was the rise of organized crime. Organized crime dealers such as Al Capone took charge of the illegal alcohol smuggling business. Since alcohol was prohibited, so people had to turn to organized crime dealers for alcohol. Under prohibition, Al Capone earned about 100 million dollars annually. The organized crime dealers had secured their business by bribing influential people of the city. Thornton (1998) states that the number of speakeasies increased during prohibition. Speakeasies made it easy for any man to obtain alcohol from any street. They were actually present in the basements of office buildings and allowed only members to enter. Rival gangs were set up to gain profit from the bootlegging industry. The “profit motive” led the organized crime dealers to 400 murders annually in Chicago alone. Gang warfare became very common (Bowen, 1969).
Thornton (1998) adds that other criminal activities such as homicide increased by 78% during prohibition. Other serious crimes, including assault and battery, increased by 13%, and crimes related to victims increased by 9%. Between 1920 and 1921, the major crime rate increased to 24%. During prohibition, the number of federal convicts increased by 561%. Many legal jobs were destroyed, which resulted in increased crime, and prices were raised since the people had to pay for the prohibited items. Prohibition did reduce some minor crimes such as vagrancy, mischief, and swearing by 50%.
There was an increase in alcohol consumption under prohibition. The good point was that initially, alcohol consumption decreased. Policymakers felt that the Act was working. The years between 192-21 saw the lowest rate of alcohol consumption (Thornton, 1991). However, the decline was for a little period. People spent their hard-earned money to obtain alcohol by hook or by crook. Bowen (1969) states that alcohol produced for medicinal purposes was technically legal, but there were several rules about its dosage. A person was not allowed to consume more than one pint in ten days period. However, these laws were violated. Many advocates of the Prohibition Act are of the view that it actually helped in minimizing the rate of deaths due to alcohol consumption. According to Thornton (1998), the medicinal alcohol had 95% pure alcohol, and its sale grew to 400 percent between 1923 and 1931. For this reason, there was a rise in the deaths and arrests due to drunkenness during prohibition.
Economic Aspect of Prohibition
Not only had the Prohibition Act affected the country socially but economically. Also, it had its severe drawbacks. One of the major economic set back due to prohibition was the fact that the government was not taxing the multi-billion dollar per annum industry. Miron (2001) touches upon the economic aspects of prohibition in his article “The Economics of Drug Prohibition and Drug Legalization.” All the money that the bootleggers earned fell in their own pockets, which were further used to strengthen their business by bribing the high city officials and the members of their own gangs. Not a single penny was retrieved by the American government. Instead, the policymakers were found busy spending the money collected through taxes on implementing policies to enforce the Act of Prohibition. A task force called the Federal Prohibition Bureau was set up whose job was to enforce the Prohibition Act. Many officials of the Bureau were found on the payroll of the organized crime dealers. The officers spent the money of the taxpayers into prosecuting the bootleggers who got arrested. Once again, millions were spent on convicting and keeping the prisoners in jail. Thornton (1991) states that the annual budget of the Bureau of Prohibition rose from $4.4 million to $13.4 million. Employment at customs and coast guard increased by 45% and 123%, and likewise, their budget increased by 500%.
Miron (2001) writes that another economic setback caused by the prohibition was the wastage of public money on alcohol consumption. Since alcohol was not easily available, so the people had to pay more to get it. Thus the Americans found themselves in the middle of an economic crisis where their hard-earned wages were spent on getting drunk. Drunkenness affected their ability to work attentively and resulted in continued absenteeism.
This situation created a severe economic crisis for the American government who did not collect enough money which it could have collected. At the same time, the money collected through taxes was spent on useless policies that would help in making the Prohibition Act successful.
To conclude, the Prohibition Act was a great failure because it failed to achieve the goals it intended to achieve. Instead, the country found itself in the middle of economic and social crises. There was an increase in the rate of crime, murders, alcohol consumption, and deaths due to drunkenness. At the same time, corruption made its roots deep in the city, and many high officials found themselves involved in the bribery. Laws were also violated. Based on these facts, the American government finally abolished the Act after thirteen years which were declared as the years that destroyed the country to the maximum.
References
Bowen, E. “This Fabulous Century.”Vol. 6. New York: Time-Life Books, (1969). Pg. 154-175.
Miron, J.A. “The Economics of Drug Prohibition and Drug Legalization”. Social Research. (2001). Pg. 4. Web.
Morgan, J. P. “The Jamaica Ginger Paralysis”. Journal of the American Medical Association. 245:15 (1982): pg. 1864-1867.
Thornton, M. “Policy Analysis: Alcohol Prohibition Was a Failure.” CATO Institute (1991). Web.
Winburn, N. “The USA: A Chronicle of Pictures”. New York: Smithmark Publishers Inc., (1991). Pg. 234.