Last week I put up a link to a discussion on prohibition on EconTalk. The programme featured Daniel Okrent talking about his latest book called Last Call: The Rise and Fall of Prohibition. I haven’t read the book but it sounds like a fascinating anecdote-rich social history of a policy that would have disastrous consequences. I thought it would be a good idea in this week’s article to look back at this period.
At midnight, on January 16, 1920, the United States went dry as breweries, distilleries, and bars were all shut down. What caused freedom-loving Americans to go down this path? Ever since the Pilgrim Fathers had landed on Plymouth Rock America had been swimming in alcohol. There may have been no cranberry sauce, mashed potatoes or pumpkin pie at the first Thanksgiving, but there was plenty of beer, brandy, gin, and wine. The ship which brought John Winthrop along with other wealthy Puritans to form the Massachusetts Bay Company in 1630 had more beer in its holds than water. And these were the puritans! One of Harvard College’s first construction projects was a brewery to supply America’s best and brightest with a steady supply of beer. In the War of Independence George Washington decreed that every member of the Continental Army would get a daily ration of 4 ounces of whisky. The distillation of whisky led to the first test of federal power, the so-called Whisky Rebellion when Alexander Hamilton introduced an excise tax on whisky. In 1830 the average American drank 26.5 litres of alcohol a year. Considering that there were a lot of teetotallers, those who were drinking were drinking a hell of a lot. America had a serious problem with booze. But fear not, there were some citizens who believed they had the solution.
Politics makes strange bedfellows and the two sides that lined up against each other in the battle over prohibition illustrate this perfectly. Those in favour of prohibition included women’s suffragists, some Protestants especially Baptists and Methodists, and the Ku Klux Klan. Opposing them were alcohol producers, Catholics and Jews and millions of drinkers. The fact that most of the brewers were of German origin did not help the anti-prohibition case. Names such as Anheuser, Busch, Schlitz, and Coors made it easy for them to be portrayed as a fifth column undermining the strength of the American fighting man. Economists often talk about bootleggers and Baptists. This concept was described by the economist Bruce Yandle; preachers campaign to make alcohol illegal while the criminal bootlegger also wants it to stay illegal because it gives him a business opportunity.
You can see exactly how this all plays out in this description taken from Willie Morris’s memoir North Toward Home
Every so often there would be a vote to determine whether liquor should be made legal. Then, for weeks before, the town would be filled with feverish campaign activity. People would quote the old saying, “As long as the people of Mississippi can stagger to the polls, they’ll vote dry.” A handful of people would come right and say that liquor should be made legal, so that the bootleggers and the sheriffs would not be able to make all the money, and because the state legislature’s “black-market tax” on whiskey, a pittance of a tax that actually contradicted the state constitution, was a shameful deceit. But these voices were few, and most of the campaigning was done by the preachers and the church groups. In their sermons the preachers would talk about the dangers of alcoholism, and the shame of all the liquor ads along the highways in Tennessee and Louisiana, and the temptations this offered the young people. Two or three weeks before the vote, the churches would hand out bumper stickers to put on cars; in big red letters they said, “For the sake of my family, vote dry.” An older boy, the son of one of the most prosperous bootleggers, drove around town in a new Buick, with three of those bumper stickers plastered on front and back: “For the sake of my family, vote dry.”
Prohibition was created by the passing of the 18th amendment and the Volstead Act. The Eighteenth Amendment to the United States Constitution, which was ratified on January 16, 1919, prohibited the production, of “intoxicating liquors.” However, it did not define exactly what “intoxicating liquors” were. The Volstead act, passed on October 28, 1919, filled this void. Any beverage containing more than 0.5% alcohol was considered intoxicating. With these two measures America began its 13-year flirtation with universal sobriety.
What actually happened when prohibition came into force? Not what its proponents had in mind. The rise of gangsters is very well known and I’m not going to go into it here. In fact, it would be wrong to focus exclusively on Al Capone and his ilk. Prohibition was flouted by a much larger part of society. What I really love are all those anecdotes that Okrent provides. One of the stars must be Jorge de la Torre, who had an ecclesiastical approbation from the archbishop of Northern California to sell altar wines to Catholic dioceses throughout the country. Within a couple of years he was making 14 different varieties – including Tokay, Riesling and Cabernet. And I haven’t been able to confirm the following story that I found on the internet but it’s just too good to leave out. It’s about a jury in California that was put on trial after it drank all the evidence in a case against a bootlegger. In their defence the jurors argued that they had been sampling the evidence to determine whether it contained alcohol or not. With all the evidence gone, the alleged bootlegger was acquitted. Religion did not provide the only exceptions; there were also exemptions for medicinal purposes and for farmers enabling them to preserve fruit. Alcohol, then, was not so difficult to find. And many people began making their own alcoholic beverages at home, using bricks of wine. These blocks of wine came with a helpful warning: “After dissolving the brick in a gallon of water, do not place the liquid in a jug away in the cupboard for twenty days, because then it would turn into wine.”
What are the lessons of the failure of prohibition? Okrent’s conclusion is clear:
“In almost every respect imaginable, Prohibition was a failure. It encouraged criminality and institutionalized hypocrisy. It deprived the government of revenue, stripped the gears of the political system, and imposed profound limitations on individual rights.”
The most fundamental conclusion is that laws cannot abolish human nature. We should always distinguish between the intentions of governments and the final results, which are often very different. We have the idea that you just pass legislation and you have solved societal problem. The concept of bootleggers and Baptists can be applied to many fields. When some new environmental regulation is brought in, there will be companies who make a lot of money out of this situation allying themselves with greens. And now there will be banking legislation following the recent financial debacle. But we must not forget the ability of humans to get round such laws. The history of prohibition is indeed a sobering one.