Sunday’s expectations of Prohibition were never realized. He and other champions of Prohibition expected it to reduce crime and solve a host of social problems by eliminating the Demon Rum. Early temperance reformers claimed that alcohol was responsible for everything from disease to broken homes. High on their list of evils were the crime and poverty associated with intemperance. They felt that the burden of taxes could be reduced if prisons and poorhouses could be emptied by abstinence. That perspective was largely based on interviews of inmates of prisons and poorhouses who claimed that their crimes and poverty were the result of alcohol.40 Social “scientists” later used those correlations as propaganda “to persuade many people to turn to saloon suppression and prohibition.“41
America had experienced a gradual decline in the rate of serious crimes over much of the 19th and early 20th centuries. That trend was unintentionally reversed by the efforts of the Prohibition movement. The homicide rate in large cities increased from 5.6 per 100,000 population during the first decade of the century to 8.4 during the second decade when the Harrison Narcotics Act, a wave of state alcohol prohibitions, and World War I alcohol restrictions were enacted. The homicide rate increased to 10 per 100,000 population during the 1920s, a 78 percent increase over the pre‐Prohibition period.
The Volstead Act, passed to enforce the Eighteenth Amendment, had an immediate impact on crime. According to a study of 30 major U.S. cities, the number of crimes increased 24 percent between 1920 and 1921. The study revealed that during that period more money was spent on police (11.4+ percent) and more people were arrested for violating Prohibition laws (102+ percent). But increased law enforcement efforts did not appear to reduce drinking: arrests for drunkenness and disorderly conduct increased 41 percent, and arrests of drunken drivers increased 81 percent. Among crimes with victims, thefts and burglaries increased 9 percent, while homicides and incidents of assault and battery increased 13 percent.42 More crimes were committed because prohibition destroys legal jobs, creates black‐market violence, diverts resources from enforcement of other laws, and greatly increases the prices people have to pay for the prohibited goods.
Instead of emptying the prisons as its supporters had hoped it would, Prohibition quickly filled the prisons to capacity. Those convicted of additional crimes with victims (burglaries, robberies, and murders), which were due to Prohibition and the black market, were incarcerated largely in city and county jails and state prisons. According to Towne, “The Sing Sing prison deported no less than sixty prisoners to Auburn in May 1922 because of overcrowding.” Figure 3 shows the tremendous increase in the prison population at Sing Sing in the early years of Prohibition.43
Figure 3: Inmates at Sing Sing Prison: 1917–22
Source: Charles Hanson Towne, The Rise and Fall of Prohibition (New York: Macmillan, 1923) p. 162.
Before Prohibition and the Harrison Narcotics Act (1914), there had been 4,000 federal convicts, fewer than 3,000 of whom were housed in federal prisons. By 1932 the number of federal convicts had increased 561 percent, to 26,589, and the federal prison population had increased 366 percent.44 Much of the increase was due to violations of the Volstead Act and other Prohibition laws. The number of people convicted of Prohibition violations increased 1,000 percent between 1925 and 1930, and fully half of all prisoners received in 1930 had been convicted of such violations. Two‐thirds of all prisoners received in 1930 had been convicted of alcohol and drug offenses, and that figure rises to 75 percent of violators if other commercial prohibitions are included.45
The explosion in the prison population greatly increased spending on prisons and led to severe overcrowding. Total federal expenditures on penal institutions increased more than 1,000 percent between 1915 and 1932. Despite those expenditures and new prison space, prisons were severely overcrowded. In 1929 the normal capacity of Atlanta Penitentiary and Leavenworth Prison was approximately 1,500 each, but their actual population exceeded 3,700 each.46
To some the crime wave of the 1920s remained a mere “state of mind” due mostly to media hype. For example, Dr. Fabian Franklin noted that according to one measure, crime had decreased 37.7 percent between 1910 and 1923. However, the apparent contradiction between the media hype and Franklin’s declining crime statistic is resolved by the realization that violent and serious crime had increased (hence the media hype), while less serious crime had decreased. For example, theft of property increased 13.2 percent, homicide increased 16.1 percent, and robbery rose 83.3 percent between 1910 and 1923, while minor crimes (which were large in number) such as vagrancy, malicious mischief, and public swearing decreased over 50 percent.47 Even Franklin had to admit that the increased homicides may have been related to the “illegal traffic.”
The number of violations of Prohibition laws and violent crimes against persons and property continued to increase throughout Prohibition. Figure 4 shows an undeniable relationship between Prohibition and an increase in the homicide rate. The homicide rate increased from 6 per 100,000 population in the pre‐Prohibition period to nearly 10 per 100,000 in 1933. That rising trend was reversed by the repeal of Prohibition in 1933, and the rate continued to decline throughout the 1930s and early 1940s.48
Figure 4: Homicide Rate: 1910–44
Source: Source: U.S. Bureau of the Census, Historical Statistics of the United States, Colonial Times to 1970 (Washington: Government Printing Office, 1975), part 1, p. 414.
Not only did the number of serious crimes increase, but crime became organized. Criminal groups organize around the steady source of income provided by laws against victimless crimes such as consuming alcohol or drugs, gambling, and prostitution. In the process of providing goods and services, those criminal organizations resort to real crimes in defense of sales territories, brand names, and labor contracts. That is true of extensive crime syndicates (the Mafia) as well as street gangs, a criminal element that first surfaced during Prohibition.49
The most telling sign of the relationship between serious crime and Prohibition was the dramatic reversal in the rates for robbery, burglary, murder, and assault when Prohibition was repealed in 1933. That dramatic reversal has Marxist and business‐cycle crime theorists puzzled to this day. For example, sociologist John Pandiani noted that “a major wave of crime appears to have begun as early as the mid 1920s [and] increased continually until 1933 … when it mysteriously reversed itself.“50 Theodore Ferdinand also found a “mysterious” decline that began in 1933 and lasted throughout the 1930s.51 How could they miss the significance of the fact that the crime rate dropped in 1933? Prohibition Caused Corruption
It was hoped that Prohibition would eliminate corrupting influences in society; instead, Prohibition itself became a major source of corruption. Everyone from major politicians to the cop on the beat took bribes from bootleggers, moonshiners, crime bosses, and owners of speakeasies. The Bureau of Prohibition was particularly susceptible and had to be reorganized to reduce corruption. According to Assistant Secretary of the Treasury Lincoln C. Andrews, “conspiracies are nation wide in extent, in great numbers, organized, well‐financed, and cleverly conducted.“52 Despite additional resources and reorganization, corruption continued within the bureau. Commissioner of Prohibition Henry Anderson concluded that “the fruitless efforts at enforcement are creating public disregard not only for this law but for all laws. Public corruption through the purchase of official protection for this illegal traffic is widespread and notorious. The courts are cluttered with prohibition cases to an extent which seriously affects the entire administration of justice.“53
Prohibition not only created the Bureau of Prohibition, it gave rise to a dramatic increase in the size and power of other government agencies as well. Between 1920 and 1930 employment at the Customs Service increased 45 percent, and the service’s annual budget increased 123 percent. Personnel of the Coast Guard increased 188 percent during the 1920s, and its budget increased more than 500 percent between 1915 and 1932. Those increases were primarily due to the Coast Guard’s and the Customs Service’s role in enforcing Prohibition.54
Conclusion: Lessons for Today
Prohibition, which failed to improve health and virtue in America, can afford some invaluable lessons. First, it can provide some perspective on the current crisis in drug prohibition — a 75‐year effort that is increasingly viewed as a failure.
Repeal of Prohibition dramatically reduced crime, including organized crime, and corruption. Jobs were created, and new voluntary efforts, such as Alcoholics Anonymous, which was begun in 1934, succeeded in helping alcoholics. Those lessons can be applied to the current crisis in drug prohibition and the problems of drug abuse. Second, the lessons of Prohibition should be used to curb the urge to prohibit. Neoprohibition of alcohol and prohibition of tobacco would result in more crime, corruption, and dangerous products and increased government control over the average citizen’s life. Finally, Prohibition provides a general lesson that society can no more be successfully engineered in the United States than in the Soviet Union.
Prohibition was supposed to be an economic and moral bonanza. Prisons and poorhouses were to be emptied, taxes cut, and social problems eliminated. Productivity was to skyrocket and absenteeism disappear. The economy was to enter a never‐ending boom. That utopian outlook was shattered by the stock market crash of 1929. Prohibition did not improve productivity or reduce absenteeism.55 In contrast, private regulation of employees’ drinking improved productivity, reduced absenteeism, and reduced industrial accidents wherever it was tried before, during, and after Prohibition.56
In summary, Prohibition did not achieve its goals. Instead, it added to the problems it was intended to solve and supplanted other ways of addressing problems. The only beneficiaries of Prohibition were bootleggers, crime bosses, and the forces of big government. Carroll Wooddy concluded that the “Eighteenth Amendment … contributed substantially to the growth of government and of government costs in this period [1915–32].“57
In the aftermath of Prohibition, economist Ludwig von Mises wrote, “Once the principle is admitted that it is the duty of government to protect the individual against his own foolishness, no serious objections can be advanced against further encroachments.“58 The repeal of all prohibition of voluntary exchange is as important to the restoration of liberty now as its enactment was to the cause of big government in the Progressive Era.
1 The “Koop doctrine,” for example, calls for a smoke‐free America by the year 2000. For a description of the antialcohol movement, see Jacob Sullum, “Invasion of the Bottle Snatchers,” Reason 21, no. 9 (February 1990): 26–32. For a description of that movement’s subversive measures against alcohol, see recent issues of Moderation Reader, which is published by Citizens for Moderation, Seattle, Washington.
The federal bureaucracies charged with reducing access to purportedly harmful substances will resort to almost any means to achieve their goal. One example of their propa‐ganda campaign is the recent report on smoking in America, dubbed the “Sullivan Report,” that claims that 390,000 deaths per year are caused by smoking. That figure is very misleading. The estimate is based on a faulty sample and methodology; the deaths do not represent “named, individual persons”; and most of those “deaths” are of people over 65 years of age. For a critique of Sullivan’s estimate of the number of deaths and the “cost” of smoking, see Richard Ault, “The Economic Costs of Smoking: A Critique of Conven tional Wisdom” (Paper presented to the Southern Economic Association, November 1990). It should also be noted that prohibition of tobacco products was attempted at the state level during the 1920s and was a miserable failure. See Mark Thornton, “The War on Tobacco,” Free Market, November 1990, pp. 7–8. For further insight into the character of bureaucrats, see the sympathetic interview with Secretary of Health and Human Services Louis Sullivan in the Saturday Evening Post, September 1990.
2 See Mark Thornton, The Economics of Prohibition (Salt Lake City: University of Utah Press, 1991, forthcoming).
3 Clark Warburton, The Economic Results of Prohibition (New York: Columbia University Press, 1932); Irving Fisher, Prohibition at Its Worst (New York: Alcohol Information Committee, 1927). For a recent estimate of consumption of alcohol during Prohibition that concurs with earlier estimates, see Jeffrey A. Miron and Jeffrey Zwiebel, “Alcohol Consumption during Prohibition,” American Economic Review: Papers and Proceedings 81, no. 2 (May 1991): 242–47.
4 See Mark Thornton, The Economics of Prohibition (Ph.D. diss., Auburn University, 1989), pp. 174–80.
5 Warburton’s estimates are the most reliable, although he felt that he might have underestimated the sales of the most potent products — spirits. Warburton, pp. 104–8.
6 According to Warburton, from 1921 to 1929 the apparent per capita consumption of beer increased 463 percent, that of wine increased 100 percent, and that of spirits increased 520 percent. While per capita beer consumption in 1929 was only one‐third the 1909 level, per capita consumption of wine and spirits was above 1909 levels. If that trend had continued, total per capita consumption of alcohol would have surpassed pre‐Prohibition levels during the mid‐1930s. Warburton, p. 174.
7 As noted above, Warburton found that production of beer, wine, and spirits rapidly expanded during the 1920s. It should be remembered that illegal sources of alcohol were just organizing in 1920–21 and that large inventories could still be relied on during those early years.
8 Bureau of Prohibition, Statistics Concerning Intoxicating Liquors (Washington: Government Printing Office, December 1930), p. 2.
9 Richard Cowan, “How the Narcs Created Crack,” National Review, December 5, 1986, pp. 30–31.
10 See Mark Thornton, “The Potency of Illegal Drugs,” Auburn University working paper, 1986; and Thornton, The Eco nomics of Prohibition.
11 See Thornton, The Economics of Prohibition, pp. 176–79.
12 Alcohol produced for industrial, medical, and ceremonial purposes, although illegally consumed, could not be eliminated.
13 Data from Warburton, pp. 114–15; and Licensed Beverage Industry, Facts about the Licensed Beverage Industry (New York: LBI, 1961), pp. 54–55.
14 The same effect can be seen at most college football games where alcoholic beverages are prohibited. Football fans are normally beer drinkers. However, they typically become brandy, bourbon, and rum smugglers at football games. It is easier to smuggle any given quantity of alcohol in the form of more potent beverages.
15 Fisher, p. 91. His support for Prohibition may have blinded him to the importance of the change in relative prices. Certainly others have made a similar mistake, such as Tun Yuan Hu, The Liquor Tax in the United States: 1791–1947 (New York: Columbia University Graduate School of Business, 1947), p. 54, who found it “difficult to agree with him Warburton] that prohibition had not curtailed but, on the contrary, increased the consumption of spirits.”
16 Henry Lee, How Dry We Were (Englewood Cliffs, N.J.: Prentice‐Hall, 1963). Lee refers to 38‐proof (100 proof equals 50 percent ethyl alcohol by volume) beer (p. 76), which would have been five times the strength of legal beer, and to 170‐proof spirits (p. 202) that were produced on a large scale and had roughly twice the potency of legal spirits.
17 Fisher, pp. 28–29. Fisher was not describing an unfortunate consequence of Prohibition; he was trying to explain “distortions” in the statistics on arrests for drunkenness. According to Fisher, people were drinking less but getting drunker.
18 Thomas M. Coffey, The Long Thirst: Prohibition in America, 1920–1933 (New York: W.W. Norton & Co., 1975), pp. 19698.
19 Quoted in Lawrence W. Reed, “Would Legalization Increase Drug Use?” Free Market, February 1990.
20 Warburton, p. 206.
21 Clarence Darrow and Victor S. Yarros, The Prohibition Mania: A Reply to Professor Irving Fisher and Others (New York: Boni and Liveright, 1927).
22 Warburton, p. 222.
23 Physician F. E. Oliver reported in 1872 on several studies that showed that consumption of opiates and other nar cotics increased dramatically when the price of alcohol rose or when prohibitions were enforced. The use of narcotics was also common among the membership of total abstinence societies. Wayne H. Morgan, Yesterday’s Addicts: American Society and Drug Abuse, 1865–1920 (Norman: University of Oklahoma Press, 1974), pp. 49–50.
25 R. Norton, R. Bartez, T. Dwyer, and S. MacMahoney, “Alcohol Consumption and the Risk of Alcohol‐Related Cirrhosis in Women,” British Medical Journal 295 (1987): 80–82.
25 See, for example, Warburton, p. 73, and Gene Ford, Drinking and Health (San Francisco: Wine Appreciation Guild, 1990), p. 79.
26 Wine Institute, Wine and Medical Practice, 10th ed. (San Francisco: Wine Institute, 1979); cited in Ford, p. 79.
27New York Times, March 26, 1931, p. 1.
28 The death rate due to alcoholism and cirrhosis began to decrease after 1916, before the wartime restrictions began. The tax rate on a gallon of distilled spirits increased from $1.10 to $3.20 in October 1917 and to $6.40 in February 1919. The War Prohibition Act did not become effective until July 1, 1919. Taking into account massive immigration and the impact of World War I, the alcohol‐related death rate may have begun to decline much earlier. It should also be noted that death due to alcoholism and cirrhosis is thought to be the result of a long, cumulative process; therefore, the decrease in death rates must, in part, be at tributed to factors at work before the wartime restrictions on alcohol and Prohibition.
29 Warburton, p. 90.
30 Ibid., pp. 78–90.
31 Darrow and Yarros, p. 40.
32 Warburton concludes that “there is thus no statistical evidence, at least so far as these death rates are concerned, that prohibition has had a measurable influence upon the general public health, either directly or indirectly through the living standard” (p. 221).
33 Darrow and Yarros, pp. 139–46.
34 Hugo Mnsterberg, American Problems from the Point of View of a Psychologist (1910; Freeport, N.Y.: Books for Libraries Press, 1969); quoted in Darrow and Yarros, pp. 135–36.
35 Gene Ford, The Benefits of Moderate Drinking: Alcohol, Health and Society (San Francisco: Wine Appreciation Guild, 1988), pp. 18–26. It may be more appropriate in some cases to say that the problems are with the consumers rather than with the goods themselves.
36 Ibid., pp. 27–30.
37 American Heart Association, “Report of Inter‐Society Commission for Heart Disease Resources,” 1984; quoted in Ford, pp. 30–31.
38 Thomas Nixon Carver, Government Control of the Liquor Business in Great Britain and the United States (New York: Oxford University Press, 1919), chap. 6.
39 Quoted in Michael Woodiwiss, Crimes, Crusades and Corruption: Prohibitions in the United States, 1900–1987 (London: Pinter Publishers, 1988), p. 6.
40 John A. Krout, The Origins of Prohibition (New York: Alfred A. Knopf, 1925), pp. 234–35.
41 James H. Timberlake, Prohibition and the Progressive Movement: 1900–1920 (Cambridge, Mass.: Harvard University Press, 1963), p. 60. Timberlake notes that such correlations were a key element in turning social science away from the concept of free will and toward acceptance of environmental determinism.
42 Charles Hanson Towne, The Rise and Fall of Prohibition: The Human Side of What the Eighteenth Amendment Has Done to the United States (New York: Macmillan, 1923), pp. 156–61. The 30 cities examined had a total population of more than 10 million. A closer examination of the cities studied indicates that the greatest increases in crime occurred in those that were previously wet; the only cities to experience a decline in arrests were already dry when Prohibition was enacted.
43 Ibid., p. 162.
44 Carroll H. Wooddy, The Growth of the Federal Government, 1915–1932 (New York: McGraw‐Hill, 1934), p. 95.
45 Ibid., p. 94.
46 Ibid., p. 75.
47 Fisher, pp. 75–80.
48 Figure 4 is a revised table first suggested by James Ostrowski, “Thinking about Drug Legalization,” Cato Institute Policy Analysis no. 121, May 28, 1989.
49 Thornton, The Economics of Prohibition, chap. 5.
50 John A. Pandiani, “The Crime Control Corps: An Invisible New Deal Program,” British Journal of Sociology 33 (Septem ber 1982): 348–58.
51 Theodore N. Ferdinand, “The Criminal Patterns of Boston since 1849,” American Journal of Sociology 73 (1967): 84–99.
52 U.S. Department of the Treasury, Prohibition Enforcement (Washington: Government Printing Office, 1927), p. 2.
53 National Commission on Law Observance and Enforcement, Enforcement of the Prohibition Laws of the United States (Washington: Government Printing Office, 1931), p. 90.
54 Ibid., p. 215. The additional resources greatly expanded the enforcement of Prohibition. The annual number of liquor seizures by Customs doubled between 1927 and 1931.
55 Ibid.; Warburton, pp. 203–06.
56 Thornton, The Economics of Prohibition, chap. 1.
57 Ibid.; Wooddy, p. 104.
58 Ludwig von Mises, Human Action, 3d revised ed. (Chicago: Henry Regnery, 1966), p. 733.