Prohibition (1919-1933)

The long-term effect of Prohibition for the Americans at large was a degeneration of beer culture which has only cautiously been reversed since the first microbreweries opened in the 1980s. The Germans were among the immigrant groups that suffered most from the onslaught of the temperance movement and from the enactment of National Prohibition. Although the role of brewers of German descent in the self-inflicted saloon crises was considerable and their attempts to defend themselves clumsy and self-defeating, they had to sustain severe losses when the beer trade became illegal, driving a part of the brewery owners to the brink of illegality themselves—or beyond.

Updated: March 17, 2015

The Prohibition era denotes the thirteen years of National Prohibition which was in effect from January 16, 1920, to December 5, 1933. During this time, alcohol was banned by the U.S. Constitution, as provided for by the 18th Amendment. This constitutional amendment, approved by the U.S. Congress on December 18, 1917, declared the manufacture, transportation, and sale—but not the consumption as such—of “intoxicating liquors,” that is alcohol for beverage purposes, illegal. The obligatory ratification of the amendment by three-fourths of the forty-eight states proceeded with unprecedented rapidity and was accomplished by January 16, 1919, when the Nebraska legislature voted yes. Prohibition was to commence one year later. In order to make Prohibition enforceable by the executive branch of government, Congress passed a statutory law, the National Prohibition Act, called the Volstead Act after the Minnesota congressman who had drafted it, on October 28, 1919, overriding President Wilson’s veto. This law specified the content of ethanol by volume that made a drink “intoxicating” to be 0.5 percent—the least taxable amount as defined by the Internal Revenue Service in collaboration with the liquor industry long before (one proof). 0.5 percent meant “bone dry,” and this explicitly included lighter beers and wines in the gallery of outlawed refreshments.

National Prohibition in the U.S. was a daring venture in social engineering by a constitutional legislature. This “great social and economic experiment, noble in motive and far-reaching in purpose,” as Herbert C. Hoover would famously canonize it in 1928, was singular not only in United States but in world history.[1] Equally unprecedented was the fact that the 18th Amendment would be repealed in 1933—the first time ever or since that a part of the constitution would be revoked in the United States. After the landslide victory of Franklin D. Roosevelt in the presidential elections of November 1932, it was the old, lame-duck Congress that put together the two-thirds vote necessary to adopt the 21st Amendment whose only purpose was to declare the 18th Amendment void and give back to the states complete authority over liquor regulation. The 21st Amendment was passed on February 20, 1933, and sent on its ratification journey through the states. It beat its predecessor by four months when Utah became the thirty-sixth state to consent to the 21st Amendment on December 5, 1933. The 21st Amendment went into effect immediately. National Prohibition was history.

When we talk about “Prohibition” in this article we focus on this salient era of National Prohibition in the United States. This is not to play down the long prologue of the temperance movement in the U.S. and the long history of local and state prohibitions of alcohol. Restrictive alcohol regulations also have not vanished with the demise of National Prohibition, as Sunday “blue laws,” local options, the continued existence of “dry counties” and strict age restrictions indicate. The relationship of Americans with alcohol—even compared with other drugs—has remained uptight.

The Ascent and Eventual Triumph of the Prohibition Movement

The American temperance movement originated in the revivals of the Second Great Awakening during the 1820s and 1830s, with predecessors dating back as far as 1808. This may explain its traction and energy. The religious upheaval can be interpreted as a reaction against the widely felt disintegration of the post-revolutionary American village and small-town society. Creeping commercialism, with its tendency to increase social inequality and the absence of institutions able to integrate larger sections of a regional population, contributed to a loosening of social ties that translated into a growing experience of insecurity and alienation in everyday traffic and communication. Reports of the unbelievable amounts of alcohol colonial and post-revolutionary Americans digested may sound more credible if read as describing drink as a therapeutic supplement to overcome these feelings of insecurity. That the United States would degenerate into an “alcoholic republic” in the process constituted a major problem the Christian crusaders attacked alongside social disintegration, as the flipside of the same coin.[2] In a certain sense, the Awakenings proposed an alternative to the fleeting connections created by temporary drinking camaraderie of lasting social bonds grounded within religious communities. The evangelical movement envisioned a social cosmos of small, face-to-face communities bound together by ties to charismatic belief and effervescent religious practices. In the eyes of the temperance crusaders, drinking culture not only failed to create lasting bonds but, indeed, deepened social cleavages instead of bridging them. It should be no surprise, therefore, that temperance in the United States very soon came to mean total abstinence.

The religious temperance movement also became a cradle of the feminist movement. From its beginnings as a strictly conservative and spiritual mechanism for women to gather together for socially-sanctioned activism it quickly turned into an amalgamation of women complete with all the assets and traits of a forceful social movement. This development was epitomized by the formation of the National Woman’s Christian Temperance Union (WCTU) in 1874. The WCTU soon replaced religious martyr figures such as the hatchet-swinging Carry A. Nation, who had drawn nationwide curiosity by single-handedly smashing saloon interiors and intimidating saloonkeepers, with slick female proto-politicians who gained rhetorical experience in speaking about temperance to meetings of their church groups or at bazaars, picnics and other charitable events. The temperance movement was a vehicle for women to gain access to the public sphere, and modern interpretations read its radical policies as a conservative proxy for the “unspeakable” direct discussion of traditional gender relations. Despite representing a most conservative worldview of womanhood and placing family values above all else, the WCTU was one of the most vital forces behind the mounting pressure for the enfranchisement of women. This was accomplished in 1920 when the 19th Amendment was adopted establishing woman suffrage. The support of male temperance forces for female suffrage was built on the presumption that all American women would speak with one voice and stand firmly behind the fight against alcohol and the saloon. The 19th Amendment, spokeswomen of the movement declared, would insure that the 18th Amendment would remain in force eternally. By 1920, the WCTU, with many international ties by that time, was, with a membership topping a million, the strongest female organization in the world.

The temperance movement, then, was simultaneously a religious movement and a movement for social reform. It gained its first successes by building up a mass followership as long as the spectacular practices of the revivals remained in vogue. Street processions of activists who tried to persuade their drinking contemporaries to abstain by collective prayer and the chanting of hymns were common and almost as popular as the public meetings held by the secular Washingtonian movement at which individuals from working-class backgrounds gave emotional confessions of their dependence on alcohol and made solemn, heartbreaking pledges to be abstinent. During the following decades temperance became an issue around which a broad spectrum of fraternal lodges crystallized—interestingly enough with alcohol at the center of their social life, but not as a means of bonding but rather as an enemy against which they could rally. Many such lodges instituted petition campaigns to state legislatures and, beginning with Maine in 1851, succeeded in bringing about thirteen state prohibitions which suffered from sluggish enforcement and soon petered out.

The fight against alcohol seemed to have become a stopgap in the American political discourse in the nineteenth century during times when nothing more important, such as abolitionism, the integrity of the Union, or the Civil War, was at stake. Thus after being virtually non-existent for ten years, the temperance lodges accumulated half a million members within the five years after the war. They became the force behind the formation of the Prohibition Party in 1869 which assembled a broad political platform with alcohol restriction accounting for only one of its planks. The Prohibition Party proved particularly innovative in developing anti-alcohol and pro-prohibition propaganda, and we owe to it a plethora of colorful cartoons as well as poems and hymns of more doubtful quality. Yet in electoral politics the movement was dramatically unsuccessful and, in the 1880s, it was the Populist Party’s reformist platform that found appeal among many working-class people and small farmers who probably indulged in a drink or two a week. Some Republicans in the South rediscovered alcohol as a political issue in the 1880s when they used it to assail the hegemonic Democrats with accusations that by failing to wholeheartedly embrace temperance they were allegedly enabling criminality among African-American men, and in particular violence against white women. In the following years both parties developed a heightened sensitivity to anti-alcohol propaganda in order not to miss a political opportunity. The Prohibition Party is the third-oldest party organization in the United States, but the co-opting of the alcohol issue by the two big parties meant the party failed to gain traction—a situation which lasts to today.[3]

Upon the initiative of Republican Party operatives, the Anti-Saloon League (ASL) was established and, by 1895, was a nationwide organization. This was a groundbreaking political innovation. The Anti-Saloon League, in contrast to the Prohibition Party, was one of the first single issue-organizations in history, and it operated on a strictly bipartisan basis. The Anti-Saloon League declared the prohibition of alcohol and the legal ban of the saloon its only political goals. In order to pursue these goals as a nonpartisan organization the ASL developed a two-fold strategy: first, it reached out to the thousands of evangelical church communities in the country, provided them with skilled and entertaining speakers, knit together a close network of sympathetic ministers, and thus sparked community life toward a common purpose: the fight against alcohol. The ASL paid for expenses such as setting up meeting halls and paying ministers, thus in many cases helping to build up an independent community life from scratch. These investments proved profitable, however, since the ASL raked in large sums of money in the form of donations by community members which they were invited to pledge by providing pre-printed checks in pre-addressed envelopes when one of the ASL’s famed orators visited. This financial grass-roots support made up the bulk—about eighty percent—of the material strength of the ASL, although large donors such as John D. Rockefeller, who was said to have handed over $5,000 after being impressed by a speech by Wayne B. Wheeler on a winter Sunday in 1918 (or $72,400 in 2010 dollars), were certainly welcome.[4]

Second, the ASL utilized these lavish funds to support “friendly” political candidates or to oppose adversaries in elections. The ASL was not picky as to principles: candidates it supported did not have to be “dry personally” as long as they pledged to vote along its lines.[5] In this way, many political careers were made—and small fortunes—since the ASL used to send political hopefuls on tour through the evangelical communities for a while to polish their rhetorical skills, and political veterans able to draw big and munificent crowds were awarded up to $50,000 per annum during the critical years of 1919–1920 (or $544,000 in 2010 dollars). The self-made man and small-town lawyer Wayne B. Wheeler—officially only the ASL’s legal counsel, until 1916 when he became general secretary—established headquarters in Washington, D.C., from which he lobbied on the ASL’s behalf and controlled the voting behavior of the congressmen and senators who were on the ASL’s payroll. T. Justin Steuart, Wheeler’s personal publicity representative, who later broke with him and then became his unauthorized biographer, wrote that he “controlled six Congresses, dictated to two Presidents of the United States, directed legislation for the most important elective state and federal offices, held the balance of power in both Republican and Democratic parties, distributed more patronage than any other dozen men, supervised a federal bureau from outside without official authority, and was recognized by friend and foe alike as the most masterful and powerful single individual in the United States.”[6] Local and state chapters of the ASL, often studded with members of the town’s or region’s elites, likewise monitored elected and appointed officials to ensure they abided by the pledges they had given to support the ASL’s agenda. The overarching long-term success of these policies was anchored in the bipartisan approach the ASL took before the 1920s. The Prohibition Amendment was adopted by a two-thirds majority in both parties, and whereas the Republicans were the driving force behind it in the North, the Democratic Party pushed it through in the South.

Strategically, the ASL followed a cumulative procedure, pursuing local options or the demarcation of alcohol-free zones around churches, schools, or more exclusive residential quarters on the local level, then building up to county- and state-level prohibition to—as the final goal—national prohibition. During the 1890s the ASL was successful in establishing a whole sequence of state prohibitions, most of them in the “Old South,” thanks to a renewed propaganda offensive denouncing alleged black violence against white women due to alcohol consumption. By 1919, thirty-two states had enacted some form of prohibition statute and another fourteen had consented to local options; of the 2,543 counties in the nation, only 305 had not yet declared themselves “dry,” as protagonists of the movement habitually noted in public speeches.[7] But numbers alone were misleading: the thirteen states where the alcohol industry was concentrated contained roughly half of the nation’s population, and furthermore these citizens were clustered in big cities with lively drinking cultures and were unwilling to surrender their right to drink to the demands of religious zealots whose base was the rural and small-town Midwest.

The ASL would never have been successful if it had been limited to a movement of evangelicals in the Protestant church communities of the country. Indeed, the very professional leadership of the ASL was anything but pious in its outlook and habits. The ASL’s elaborate and extensive community work can rather be seen as a cynical instrument to drain financial resources from the church members as cash cows. The religious side of the movement and even the well-organized WCTU never gained any influence on the ASL’s policies. The ASL did form alliances with diverse reform movements as Progressivism spread from the 1890s on. It must be clear that there was no strict separation between the Protestant churches and the reformers. Many of their protagonists had a religious history and remained active community members even if they came to embrace Darwinism and other modernist theories. Most reformers, as diverse and locally-oriented as they were, shared a middle-class background and were trained in the modern professions as architects, civil engineers, psychologists, or medical doctors. Frequently they used their engagement in the reform movement as a vehicle for further professionalization and for starting up their careers. This explains the expertise-centered approach and hands-on attitude they often displayed when confronting urban problems. As inhabitants of the growing suburbs in the expanding metropolises of the East Coast and the industrial Midwest they championed urban reforms, and one of the most crucial projects for them was to wrestle political control from the “bosses” and “political machines” who dominated the inner cities overcrowded by immigrants and determined municipal and state politics. Many of these middle-class reformers were college graduates and adhered to modernist concepts of municipal socialism and social engineering. Among them were the first eugenicists in the United States, founders of a forceful movement in the 1920s and rather strange bedfellows for the “creationists” in the evangelical church communities who made up the ASL’s mass membership. Yet since the political headquarters of “bosses” and “machines” such as Tammany Hall in New York City were the notorious saloons, all these groups shared a common stereotype of their enemy.[8]

The urban reformers remained locked in a minority position, and so their demands to ban alcohol and the saloon had no realistic chance against the dominance of the “political machines” and the “wet” majorities these produced on the local and state level on the East Coast and the industrial Midwest. This was the reason why the ASL eventually strove for constitutional prohibition. Enshrining the ban on alcohol in the Constitution appeared as the only way both to force policies upon states that had resisted the ASL’s attacks so far and to make prohibition irreversible—at least in theory, since no constitutional amendment had been revoked, while any “normal” statutory law could be overturned by a simple majority vote or invalidated by a judicial decision. Although the ASL fell short of assembling margins to pass Prohibition in both houses of Congress in 1913, it expressed a heightened sense of urgency to make the ban on alcohol a constitutional issue. First, public sentiment seemed favorable as never before, and, second, the imminent reapportionment of electoral districts after the 1920 Census was anticipated to benefit urban areas with immigrant populations fiercely opposed to National Prohibition.[9] Thus the congressional elections of 1918, which resulted in solid pro-prohibition majorities in both houses, were already seen as the last chance to bring about National Prohibition.

German Beer Culture, German Resistance against Prohibition, and Wartime Defeat

World War I and ambient anti-German hysteria played into the hands of the ASL. The beer brewing industry in the United States had long been identified with the industrious German immigrant community which had succeeded so well as a whole in the United States. Eberhard Anheuser of Anheuser Busch in St. Louis came from Bad Kreuznach, in the Palatinate; his business associate and son-in-law Adolphus Busch was from Hesse. Their enterprise first flourished under the name of Bavarian Brewery, a gesture that put German folklore to use for marketing purposes, as did the even more elaborate undertakings of Pabst, Miller, and Schlitz of Milwaukee who founded hotel chains and resorts all over the country, set up German-style beer gardens in places like New York City, sponsored theatres and movie houses, and eventually left a highly visible German imprint on not only Milwaukee but other Midwestern centers. Joseph Schlitz, son of a Mainz-born cellarman, led the enterprise of his former employer, whose widow he married, to the leading position worldwide among all breweries in 1902. Michael Sieben, also from Mainz, founded the Sieben Brewery in Chicago in 1865, which later earned infamy as a wildcat establishment in the illicit beer market in the 1920s when it was owned by a conglomerate of formerly well-renowned brewers and gangsters such as John Torrio, then the criminal overlord of the Windy City.[10]

The German-led breweries soon expanded their lager trade and invaded the established saloon culture with products which had been shaped by the English and Irish tradition of patrons drinking both beer and hard liquor while standing alongside a long bar in an all-male environment. But their ventures to set up German-style beer gardens and other entertainment facilities were an attempt to import and spread a different kind of beer culture in the United States. Unlike saloons, beer gardens—in most cases not gardens proper but large beer halls—were commodious and well-lit, sometimes with folksy artwork on whitewashed walls and unsoiled sand rather than soggy sawdust on the floor. Patrons sat at long tables and almost always enjoyed a hearty meal along with drinking lager beer. Beer garden visits were family affairs, and even all-male drinking parties appeared to first-time visitors as remarkably calm. The largest beer gardens included shooting galleries and bowling alleys and often featured a wide variety of live music performances ranging from German folk music to classical pieces. Beer gardens were not without the occasional brawl among drunken patrons, but these incidents seem to have occurred more rarely than in the saloon, and often later in the evening when families were less likely to be present.[11]

When Pabst, Schlitz, and Miller marketed beer gardens as a family-friendly role model for an alternative drinking culture, sponsored cultural activities on a large scale, and advertised their lager beer as a “healthy” drink compared with other alcoholic beverages and especially with hard liquor, they actually attempted to infuse their American environment with a distinct German spirit. This is not to say that they carved out an ethnic niche for an autonomous German subculture; their ambition seems to have been to improve mainstream American culture, which they fully embraced, by introducing elements of German tradition. This led to a cultural clash with Progressive reformers, for whom Americanism had to be “100-percent pure,” and with the temperance movement that adapted the Progressive viewpoint to argue that prohibiting beer consumption was the central necessity in order to achieve a “100-percent pure” American culture.

The creeping decline of the saloons even before the national ban on alcohol was mainly a result of the economic structures and balance of power in the brewing business. The dominance of the breweries over saloons had a fatal effect. On the eve of Prohibition, brewery interests owned or controlled more than eighty percent of all saloons in the United States. Since the last third of the nineteenth century a cutthroat competition had begun in the strongly expanding brewery trade. In 1907, in Chicago alone more than forty enterprises ran fifty production sites. A full third of the capital invested in this overcapitalized industry did not produce any dividends. In their struggle for their own survival the breweries accepted consequences which were fatal in the long run, even if their “short-sighted business policy” succeeded in increasing their sales. Falling prices had to be balanced by growing production. Under these circumstances the brewery owners accepted “every means to violently increase sales.”[12]

The most important tool for this was the extension of the saloon network. In order to pump ever more beer into a hopelessly saturated market the breweries, by taking over or founding new bars and saloons, attempted to sweep into additional territory. They were less interested in the survival of the establishments set up by them or on their initiative than in selling their beer by forcing the barkeeps to do so. By way of adhesion contracts the saloon owners were tied to exclusively selling a single firm’s product. “Tied houses”—as they became known—were an invention of Chicago. The large and highly capitalized breweries in the more agricultural Midwest, which were located in medium-sized cities such as Milwaukee or St. Louis, including well-known brands like Miller, Pabst and Schlitz or Anheuser-Busch, had long exceeded the capacity of their thirsty local immigrant clientele. To utilize economies of scale they were forced to attempt, by means of aggressive marketing strategies, to create and conquer a national market. This meant lavishly outfitting saloons that sold their product with advertisements in a distinct corporate design and with lots of merchandising. In most cases this established a dependency of the saloons on the breweries. Being only medium-sized in comparison, breweries in urban agglomerations such as Chicago or New York City retaliated by formally binding saloons to the exclusive sale of their product in order to shield them against the invasion of their Milwaukee and St. Louis competitors.[13]

The brewery owners long denied their responsibility for the crisis of the “old-time saloon” which had become a topic of concern for muckraking journalists and a host of reform publications. It did not help their cause that they defended themselves in a heavy-handed and cumbersome way—for example opposing female suffrage as a threat to their business—and usually made their case most aggressively in German-language newspapers rather than engaging with English-language media. Their cultural activities and beer garden culture, while actually signifying a specific model of successful Americanization, became stigmatized as subversive attempts to undermine American identity. When they were selected as the main target of the ASL’s attack the brewers started a belated and foredoomed attempt to publicly disassociate themselves from the producers of hard liquor. Instead they became more and more identified with the evil liquor interests as such. The engagement of the United States Brewers’ Association in the National German-American Alliance, a political wing of the ethnic community which spent the first three years of World War I advocating for American neutrality, finally made the brewers traitors in the ASL’s propaganda. Wheeler managed to have Congressional hearings on their activities initiated and published unofficial reports about their alleged findings. Although the Busch family donated $500,000 in 1917 ($8.5 million in 2010 dollars) to the U.S. war effort and a consortium of Milwaukee brewers subscribed to $2 million dollars’ worth of war bonds ($34 million in 2010 dollars), the conflation of liquor interests, Germanness, and acting as the “fifth column” for the Kaiser marked the final breakthrough for pro-prohibition sentiment.[14] The popular wellness guru J.H. Kellogg paid for a full-page advertisement attacking brewers in the New York Times on November 3, 1918, with a slogan declaring: “Booze is the worst non-essential—Stop it!” and repeating David Lloyd George’s declaration that “We are fighting three enemies – Germany, Austria, and Drink.”[15]

The Economics of National Prohibition

For the legal alcohol-producing industry and most of all the distribution system of bars and restaurants, the introduction of National Prohibition meant a considerable annihilation of capital. In the industrial sector, breweries were more affected than distilleries. Between 1919 and 1928 the capitalized value of the Pabst Brewery in Milwaukee, for example, was reduced from $9 to $2.5 million (or from $113 million to $31.8 million in 2010 dollars), a drop of more than two-thirds. For this the losses from operational business between 1920 and 1925 are not even taken into account. The total market value of Anheuser Busch in St. Louis, by then the biggest lager producer in the world, was reduced from $50 million before the ban on alcohol, with $3 million net profit a year (that is, $544 million and $32.6 million in 2010 dollars), to $20 million in the year 1930 (or $261 million in 2010 dollars), “despite regained profitability and a simultaneous rise in real estate value.”[16]

This money was actually lost. In contrast to claims by world-famous statistics professor Irving Fisher of Yale University and other Prohibition enthusiasts, these sums were not directed into other, more productive channels. As Clark Warburton, an economist at Columbia University, found in 1932, in the 1920s, with a lower level of consumption, Americans spent about the same total amount of money on alcohol as if there had been no National Prohibition. With a slight increase in 1929, the last year before the sharp decline in consumer spending caused by the Great Depression started to take effect, he estimated these expenditures on alcohol at four to five billion dollars a year (or $50.9 to $63.6 billion in 2010 dollars).[17] However, it was not the legal alcohol business which benefitted from this relatively stable level of spending. Rather, the illegal black market had swallowed the biggest piece of the cake—tax-free.[18] Nicholas Murray Butler, president of Columbia University and declared opponent of Prohibition, called “illegal alcohol supplies” the “third-biggest industry in the United States,” coming “just behind the steel and oil industries.”[19]

It is not true that Americans never drank more than during the thirteen years of National Prohibition. It was also by no means one great, endless party as nostalgic folklore would have it. On average, from 1920 to 1933, alcohol consumption in the U.S.—as measured in 100 proof by volume per capita—dropped by about a third. Whether this decline was really caused by the constitutional ban is still open to debate. The first years of Prohibition, until 1922, witnessed an all-time low never experienced again, but this may have been the late effect of wartime prohibition and its precursors which denied the alcohol industry foodstuffs such as grain or sugar as resources for its manufacturing. An illicit alcohol business did not reach notable dimensions until 1924, after which it rapidly expanded and almost reached prewar levels around 1928 and 1929. The rather sluggish build-up of the alcohol shadow economy points to the fact that markets only thrive when and where there is well-funded demand. We lack the data but there cannot be any doubt that large sections of the nation—especially rural parts of the Midwest, Pacific Northwest, and the literally arid Southwest—truly were “dry,” at least as far as the black market was concerned. Bootlegging as well as the illicit production of alcohol not surprisingly developed first and foremost in the urban metropolises of the nation, with the cities on the East Coast, Chicago and Detroit, New Orleans and (at a far smaller level) San Francisco blazing the trail. Alcohol consumption would have surpassed prewar levels in 1930 had it not been for the onset of the Great Depression. Instead, illegal sales dropped sharply again without experiencing a real recovery until Prohibition was repealed in 1933. This might give room to the argument that, after all, relative prices exert a more powerful influence on any market than legal restrictions can do.

In this sense it is no surprise that Prohibition aggravated social inequality. If the measure was—in the eyes of the prohibitionists—successful at all it was because it kept the working-class and the poorer elements of society from drinking. Working-class consumption dropped by half, thanks to the drop in the beer supply and the prohibitive prices for spirits offered in the illicit establishments which clustered in working-class or in “disreputable” neighborhoods. The young and modern members of the urban middle class, on the other hand, experienced the frisson of illegal drinking as a kind of emotional liberation. These middle-class Americans drank the same amount of “pure” alcohol they would have under legal conditions but they could afford—and were willing—to pay “an extra billion a year” that amounted to the costs incident to the system of illegal procurement and distribution. “The working class found beer hard to get, drank more spirits and wine, but did without nearly half the alcohol it had been accustomed to, and so diverted a billion a year elsewhere. However, year by year more beer came onto the market—up to the Depression.”[20]

Yet the recovery of the beer market was very slow. The black market for alcohol had hard liquor as its staple—not beer or wine. The reason for this was simply that distilled spirits were a much more suitable product for illicit manufacture and smuggling. It was compact by volume and had a high content of the outlawed ingredient per unit. Spirits were rather simple to produce, particularly after 1924 when the shadow economy could process corn sugar as the sole precursor for all of the items of its portfolio, be it gin—the most widespread and popular liquor of the time—whiskey, or rum. Corn sugar became the base substance for the fabrication of “neutral” or “pure” industrial alcohol and was produced in ever larger quantities as legitimate demand, especially by the automobile and the chemical industries, expanded tenfold and more during the 1920s. The pattern of alcohol consumption among Americans changed dramatically under Prohibition. Before 1914, immigration and a more elaborate taste for gourmet gastronomy had turned the U.S. into a nation of beer drinkers and increasingly of wine connoisseurs, with beer and wine covering about eighty percent of the pure alcohol by volume consumed per capita. National Prohibition would completely reverse these proportions: “The drinking of hard liquor has increased until the country has lost its taste for good beer and wine.”[21]

The nature of supply met with certain needs of the black market clientele. Spirits promised “quicker action” and a more thorough “kick” than beer or wine—qualities prized highly by drinkers paying high prices for a glass of dubious substances in speakeasies or night clubs. For men, to get visibly drunk became a habitual asset for a gentleman who showed that he was able to afford such debaucheries, or for teenage boys a signal of their passage into manhood: “The art of modern American drinking is in everything the reverse of genteel, urbane or even pleasurable. It is conceived in spiritual violence and calculated to evoke in its practitioners their baser and more violent parts. It is, in a sense, a necessity, not only from boredom or desperation, but as the natural expression of a generation. Habitual drinkers today do not return to the bottle because they cannot resist the taste of it. In that sense their drinking is ascetic and non-sensuous. It is to a degree almost a masochistic rite, a castigation of the flesh, a ceremony akin to that which once made a saint of a man… It is better to make a virtue of a necessity and to realize that the fine drinker in America, 1929, is that one who reproduces most accurately the spirit of grain alcohol.”[22]

The quality of drink matched the degradation of drinking culture—or vice versa. Although Prohibition folklore, complete with a whole movie genre, highlights and romanticizes smuggling across the American borders, its actual significance for the amount of illegal alcohol consumed in the United States was surprisingly low. Smuggled spirits never accounted for more than two percent of consumption. The rest was produced within the United States. The diversion of industrial alcohol likewise never contributed more than up to eight percent of what made it to the market as a beverage, except for 1921 when the slow start of “moonshine” production made its share slightly more than twenty percent. Denatured industrial alcohol, that is alcohol made unfit for drinking by adding obnoxious substances such as kerosene, nicotine or, much more dangerous, wood alcohol, only served as a surrogate when the “moonshine” supply ran momentarily low. Scandalous rumors about epidemics of wood alcohol poisonings or about the murderous role of the Bureau of Prohibition in purposefully poisoning poor gin guzzlers did not have any solid statistical backing.

In a very similar vein, “medicinal alcohol” was a profitable side business for doctors and drugstore owners only in the very first years of Prohibition. American whiskey producers were required to place their existing inventory in bonded government warehouses at the onset of Prohibition, but withdrawals were permissible if whiskey was prescribed for medical purposes. It never accounted for more than one percent of all sales, and after bureaucratic regulations and dwindling supplies made dealings more difficult, it became an elite privilege for well-off gentlemen and elderly ladies who appreciated their “bootlegger” holding a medical diploma. Restrictions were tightened after the George Remus scandal in the early 1920s. Remus, a business lawyer of German descent and a licensed pharmacist, set up a (mostly bogus) chain of drugstores based in Cincinnati. This allowed him to sell liquor legally to medical doctors upon prescription. In turn, he was entitled to write withdrawal forms for the prewar stock of top-quality whiskey secured away in the bonded warehouses. Remus had appropriated huge quantities of the stuff by the acquisition of shares of distilleries such as Jack Daniel’s in St. Louis which basically were little more than entitlements to the goods stored. By utilizing a loophole in the law, Remus thus managed to bring the otherwise immobilized flood of good spirits into circulation—for his profits. These profits were even more inflated when Remus had his own delivery trucks hijacked and the cargo diverted to big bootleggers, thus evading sales taxes. Remus was sentenced to a short prison term, however, when his organization grew too big to be covered up by bribes.[23] The Remus case illustrates the limits of “freelancers” in the illicit trades who lacked the network of relationships the big city organized crime gangs could mobilize once they established the shadow economy under their own management. It also points to the fact that the German immigrants played barely any role in organized crime, most likely because they had been too successful in blending into the American mainstream and, especially, moving out of the ghetto. Finally, the idea that “sacramental wine” converted a considerable number of Irish redheads into Jewish rabbis belongs in the realm of urban legends rather than in a serious consideration of the sources of illegal alcohol under National Prohibition.[24]

The bulk of distilled spirits was produced in a myriad of establishments ranging from the congested one-room apartments of Italian immigrants in Chicago’s Little Sicily to backroom laboratories to medium-sized industrial plants with a license to manufacture industrial alcohol but without any notable deliveries to denaturing sites which would have been obligatory. Production became much easier when corn sugar was made available in large quantities by a specialized refinery industry. Almost the entire trade then switched to fabricating synthetic spirits—that is, colorless, “neutral,” “pure,” 100-proof alcohol—and to turning this into the desired product by adding colorants and aromatic flavorings. This went hand-in-hand with a concentration of production in makeshift facilities camouflaged as gas stations, chemical plants, or soft drink drumming stations. The crucial fact was that the growth of the alcohol shadow economy to truly industrial dimensions was only possible on the basis of a legal industry providing it with the essential precursors.

This was especially true for beer. The surviving brewery owners quickly adopted a strategy of using their established production methods and facilities to test the limitations set by the law as far as authorities and courts would allow. This meant supplying bootleggers with legal intermediate products for their illegal activities and thus becoming tacit accomplices of the black economy. Prohibition, with its predecessors of wartime restrictions and Wartime Prohibition after June 1, 1919, hit the brewing industry in the midst of a process of rapid concentration. At the peak of its development, in 1914, almost 1,400 breweries with a capital of $800 million dollars ($18 billion in 2010 dollars) had directly employed 88,000 people and another 300,000 people in dependent branches. In 1918, 1,100 of these plants were still producing. In 1917, the number of U.S. states where a total of 60.8 million barrels of beer was brewed had already been reduced to eighteen, yet these states contained 59 percent of the nation’s total population. Only in the immediate vicinity of industrial centers was the trade a profitable business. It is no use speculating how far this process of concentration would have been driven by the expected collapse of the saloon system even without Prohibition. Under the circumstances, by 1920 almost half of the 1,243 breweries existing in 1916 had completely withdrawn from the business.

By 1923, 662 American breweries had switched their plants to the production of a drink which legally contained up to 0.5 per cent alcohol, went under the official name of “cereal beverage” (the Volstead Act prohibited the use of the word “beer”) and was sold under the trademark of “near beer.” This name was an insult to any beer lover. Near beer was produced by extracting the alcohol from conventionally brewed beer in the course of a boiling process of several hours. The problem of this production method was that in the course of long heating, not only the alcohol but the “aromatic substance” was removed and the beer became “an almost unpotable kind of lemonade.” Even the refinement of production methods could not reverse the widespread rejection of the drink. In 1928 the production of near beer, which in 1920 had started with 9.2 million barrels—compared with 60.3 million barrels of conventional beer two years earlier—went down to only 4.2 million barrels.[25]

A move towards illegal production was impossible for big, well-known enterprises such as Anheuser Busch, Miller or Pabst. Smaller, unknown companies, which under ordinary circumstances would have been marginal suppliers, such as the Sieben Brewery in Chicago, were often bought by gangsters. Then, under cover of the legal production of “near beer,” at certain times the owners filled the barrels with fully-brewed beer before the alcohol had been extracted from it. A second method consisted of re-adding the previously extracted alcohol to finished near beer behind the backs of the supervising officials after it had been declared and labeled alcohol-free, a practice called “shooting.” Often the ownership structures of such enterprises which actually belonged to the black economy were so complicated that the people who were really behind them could not be identified behind the cover of a “legally respectable group of strawmen” who had formally founded the enterprise, hired managers, issued shares and bought the respective brewery “on paper.” Many less visible breweries—also often owned by gangsters—stayed in the near beer business only because the production and owning of intermediate and semi-finished products containing the normal level of alcohol of about six per cent was legal. Only the finished product was not allowed to contain more than 0.5 percent of alcohol. At any step of the previous production process, however, considerable amounts of beer could be withdrawn from the legal process and fed into illegal channels. The law courts tried to remedy the situation by banning the storage of real beer “in bottles and barrels” on the premises of a brewery without permission, with the exception of laboratory purposes. Thus, finding “high power” beer ready for delivery was the “smoking gun” for Prohibition authorities, providing evidence for a breach of the law. However, the smarter ones among the politically more influential “shooters” were seldom caught because usually their diverted and “shot” deliveries left the breweries immediately.[26]

As the “honest” breweries, which were constantly supervised, could not choose this strategy, they reoriented their unused production facilities towards brewing wort and other intermediate products usually prepared in the process of making real beer. The main product was concentrated malt syrup which, produced at the breweries in the traditional manner, was stabilized with preservatives and canned. Allegedly, this malt syrup was meant for baking purposes. However, malt syrup which had already been boiled with a certain percentage of hops had to be supposed to be completely unsuitable for a bakery, but when dried yeast and water were added, after a short period of fermentation it made a kind of beer. Although the packages included “warnings” informing about the dangers of accidentally started fermentation processes — which of course could also be read as covert instructions — the marketing of these products left no doubts about their actual purpose.

The finished product of the highest value, however, was ready-made wort. No wonder, as “wort” was real beer in a preliminary stage, needing only fermentation to make it actual beer. By producing wort the legal breweries had tested the limits of the law to the utmost, by dividing the production process into a part which was as legal as possible and a second, illegal part that was as simple as possible. Although marketing was completely oriented towards the do-it-yourself needs of private households, the real significance of the production of corn sugar, malt syrup and wort was in their wholesale distribution to professional black-market breweries. Technically, only the supply of these raw products through legal means made large-scale illegal brewing possible at all. The semi-finished products reached the black economy plants in compact, easily transportable form, and there they could be changed into the finished product without expensive machinery and technologically demanding piping systems, in the shortest period of time—which was important—and without any expert knowledge. Only on the basis of this division of labor could the illegal breweries, which had found accommodation at “deserted slaughterhouses, factory buildings, barns, sheds or even residential buildings,” achieve professional production capacities which came close “to medium-sized breweries of the pre-Prohibition period.”[27]

For the breweries, any production step which could somehow be legally incorporated into their own production meant a bigger piece of the demand produced from the criminal black economy. In the 1920s the production of corn sugar, dried yeast, malt syrup and wort became their actual economic basis. In 1922 Anheuser-Busch started a malt syrup business and, like all of its big competitors, switched over to producing “hops-flavored malt essence” in 1926. In 1930 its plants processed the same amount of malt as for the production of beer before the ban on alcohol. With a factory for corn sugar and glucose (1923) and its own yeast production (1927) it also became active in the field of intermediate products for winemaking and illegal distilling.

The shifting of the activities of the big legal breweries towards the production of malt syrup and wort as well as their upswing after the mid-1920s correlated conspicuously with the speed and the size to which the black economy at least partly re-established the beer market which had completely collapsed at the beginning of the 1920s. Only after 1925 may we speak of a black-economy beer market of a size worth mentioning. Until its peak in 1929, according to different estimations, beer sales on the black market were not higher, but also no less than one-third of sales in the pre-Prohibition era.[28]

The Mechanics of the Bootleg Economy and the Role of Organized Crime

Given that imported alcohol smuggled across the thousands of miles of land and sea borders accounted for only a miniscule proportion of illegal liquor consumed in the U.S. during Prohibition, the question must be asked why bootleggers engaged in this sophisticated and risky business at all—at least after notable production capacities for “moonshine” had been set up inland. Smuggling was an elaborate and bloody business. Canada was by far the most important “partner” in this bilateral business, with most of the illegal product crossing the border at the Detroit River separating Detroit, Michigan, and Windsor, Ontario, or in the adjacent regions. It helped to nurture a Canadian distilled-spirits industry despite regional alcohol prohibitions in Canada itself, because the exportation of the commodity into the United States was legal under Canadian law—if the duties were paid up properly. Meanwhile, directly outside of the three-mile limit demarcating American sovereign territory, the nickname “Rum Row” developed to describe the long stretch of waters along the northeastern seaboard where ships anchored with payloads of barrels and cases of liquor, mostly from Canada, but also including product from Europe and later Cuba and the Bahamas. New York criminal syndicates even chartered their own ships for trips to and from Great Britain, until they were, according to Meyer Lansky, “running the most efficient international shipping business in the world.”[29] Out of reach of the U.S. Coast Guard, these ships waited to be visited by flotillas of small speedboats hiding, for instance, in the secluded little bays of Long Island, which landed the contraband by night to be transported by trucks to the metropolitan centers of the alcohol shadow economy. The armed conflicts between bootleggers and U.S. Customs (and Prohibition agents) on the Canadian border and between “rumrunners” and the U.S. Coast Guard on the East Coast escalated to casualties en masse, especially when delicate transports like these became a major object for hijackings by rival gangs who seldom left potential witnesses on the scene. The situation escalated into an actual arms race as the Coast Guard’s fleet was updated with the fastest World War I destroyers by the U.S. Navy while the bootleggers made use of state-of-the-art boat-racing technology.

The smuggled stuff never reached the glasses of even the most affluent customers in an undiluted form, even though much of it was marketed as “right off the boat” and priced accordingly. In many cases it was used as an aromatizing substance for an otherwise dull “moonshine” product: “Good whiskey to-day is used more as an essence than as a beverage.”[30] Yet this points exactly to the logic behind the material battle of smuggling: in an non-transparent market the activities of “rumrunners,” widely publicized by the authorities—as were their alleged successes in chasing them down—deluded the customers that large (if undisclosed) amounts of good liquor was being brought into the country and was available for those with a fat purse. In truth, almost all “imports” were at least diluted, or else domestic products sold in forged bottles with counterfeit labels from famous European or Canadian brands. This way, Clark Warburton calculated, the amount of illegal spirits that could be sold at exorbitant “import” prices was about ten times as much as what actually crossed the American borders.[31]

This worked well because distribution and sales in the shadow economy were organized into territorial monopolies, each very soon controlled by an organized crime syndicate. Within their territories, the syndicates exercised exclusive control over the marketing of their products, if necessary by force. Competition, therefore, was not decided by relative prices but by—often violently—rounding off one’s turf. From a businessman’s point of view, territorial monopolies allowed each syndicate to have in stock a whole portfolio of illegal liquors of different “brands” and very diverse qualities. The habitual drinker personifying “perfectly inelastic demand” would swallow dirty “bathtub gin” made on the roof of his tenement building for a dollar a pint, whereas the affluent night club flâneur might order French champagne “right off the boat” for fifty dollars which actually was fermented grape juice aerated with carbon dioxide and siphoned into fancy bottles in the backroom of a Chinese laundry right around the corner.[32] The portfolio approach enabled the gangster businessman to juggle a wide spectrum of different prices for allegedly very different products and qualities, disguising the fact that all the items were grossly overpriced and most of them only shams of high-quality liquor. Economically this meant that the sale of illegal alcohol in non-transparent monopoly markets was not an entrepreneurial but a rent-seeking activity.[33]

Most of all the establishment of illegal beer supplies was profitable only on the basis of territorial monopolies, and accordingly only in the “wet” big cities where the gangs had established their strongest structures was there a supply of “real” beer. Beer was unsuitable for smuggling; per unit it contained too little of the demanded illegal substance to balance the risks; the production process was sophisticated and conspicuous, and sales were profitable only in huge amounts because the profit margin per sales unit—despite beer prices having risen tenfold under Prohibition—was low. On the other hand, the beer business required enormous corruption efforts, as with the best will in the world it could not be hidden. Thus it caused considerable overhead expenses which could only be recouped by mass distribution. Accordingly, the syndicates used their territorial power to ram their beer barrels into the cellars of speakeasy owners, just as the breweries had done to the saloons before Prohibition

This connection between the degree of organization of organized crime and the mechanics of the illegal beer business did not stay hidden from the experts of the Wickersham Commission, officially known as the National Commission on Law Observance and Enforcement, which President Hoover installed after his election. The commission, named for the former Republican attorney general who led it, was mandated to thoroughly investigate the current conditions and shortcomings of National Prohibition. Its January 1931 report declared: “When conspiracies are discovered from time to time, they disclose combinations of illicit distributors, illicit producers, local politicians, corrupt police and other enforcement agencies, making lavish payments for protection and conducting an elaborate system of individual producers and distributors. How extensive such systems may be is illustrated by some of the conspiracies recently unearthed in which 219 [persons] in one case, 156 in another, and 102 in another were indicted and prosecuted… These things,” the commission noted, “have been particularly evident in the distribution of beer.” The commission concluded: “Organized distribution has outstripped organized enforcement.”[34]

Thus, at the local level the effective control of one’s own territory and securing sales by violently enforcing the territorial monopoly were the same. The competition for distribution at the borders of different syndicates’ spheres of influence which, in the case of a shaken or debated superior authority, made conflicts particularly bloody, such as the Chicago “beer wars” that raged between 1925 and 1929. Although the big New York syndicate under Meyer Lansky, “Lucky” Luciano, and, upon his return from Italy, John Torrio, was more successful than Al Capone in establishing a territorial superiority over the city, the metropolis proved too vast for the monopoly of a single organization. In the course of the New York gang wars of the 1920s more than one thousand gangsters were killed.[35]

The shadow economy during National Prohibition was larger than the criminal syndicates, however. Thousands upon thousands of individuals—such as George Remus—and small groups entered the different branches of this lucrative if illegal business as “civilian” outsiders. Even when organized crime took over control of the trade, most of the executive and professional functions and all of the menial work were performed by “freelancers” and employees outside the ranks of the gangs and syndicates. Speakeasies and night clubs were run by professional managers who sometimes owned their joints and paid a protection or license fee as high as sixty percent of sales to the mob that controlled the local territory. There was no question that they had to exclusively sell the products of their superiors—or else. “Filling stations” like these would also be given to up-and-coming gangsters as a reward for good services, or to seasoned ones if they lived long enough to enjoy a type of old-age pension. They then would act as absentee owners employing professional barkeeps in the style of a franchise. Large establishments such as the Hawthorne Smoke Club, Capone’s gambling headquarters in Cicero near Chicago, belonged to partnerships of top gangsters like Al and Ralph Capone, Frank Nitti, and Jack Guzik directly, but ownership was camouflaged by a sophisticated arrangement of straw men and stand-ins. The main economic goal for organized crime was to get control over the production and distribution facilities of the alcohol shadow economy but not to manage day-to-day operations. Their revenue, therefore, was a rent rather than a profit, as excessive as it was.

National Prohibition made it both easy and inevitable that organized crime would take personal charge of the illicit alcohol trade. Gangsters first “muscled in” to wholesale traffic by hijacking transports, often killing the accompanying personnel in the move. They then offered their services of protection to the parties harmed—as an insurance against a risk they themselves embodied. Most crucial, however, they had at their command armed authority over urban territories—defended with deadly violence by their youth branches of “street-corner gangs.” Just as useful was that they cultivated friendly relations with politicians at the municipal and state levels, and with legal officials such as sheriffs and judges. In several instances gangsters and politicians had grown up together as buddies in the immigrant neighborhoods of the big cities, and so a lifelong friendship, bolstered by reciprocal services and stalwart loyalties, stabilized the syndicates’ control over territory.[36]

National Prohibition as a financial bonanza propelled organized crime in the U.S. to unprecedented levels of organization and standing. Organized crime had its roots in the nineteenth century when neighborhood gangs sprang up in the poor immigrant ghettoes of the port cities for ethnic self-defense. Activities in the protection racket, loansharking, gambling and prostitution very soon financed the establishment of senior gangs whose patrons often assumed informal leadership over a particular quarter, dealing out favors such as jobs, rental places, or memberships in organizations such as labor unions, for political votes, various services or the recruitment of talents to the associated neighborhood gangs. Prohibition caused a financial tsunami that at first made the gangs much more lethal—it provided the means to buy handheld firearms instead of batons and blackjacks, and later  submachine guns (Tommy guns), shotguns and fast automobiles. It further motivated the extension of networks of senior gangsters above the level of ethnic youth gangs, and the overcoming of ethnic cleavages among the syndicates. Contrary to the folklore (especially since the 1950s), only about 25 percent of all gang members were of Italian origin, with another 25 percent being Irish, and the remaining fifty percent divided between Jewish and non-Jewish immigrants with an Eastern European background. During the 1920s, commercial partnerships developed among networks of gangsters following specific projects that could be pursued even outside of their respective territories.[37]

Prohibition did not turn gangsters into (rather harmless) alcohol salesmen, however. The bootleg business just provided a generous and mostly effortless income on the basis of which one could diversify into other criminal activities. Parallel to alcohol, the narcotics market boomed, fired up by unused World War I supplies of morphine and followed by the rise of cocaine and heroin, stylish elite drugs. Alongside booze, gambling and prostitution thrived as never before; burglary and larceny were elevated to a new kind of art; and finally kidnapping became the most fancy crime of the 1920s, starting with the mutual abduction of leading crime figures and leading to the widespread capture of prominent people to be returned home on a cash-on-delivery basis. In the late 1920s, the labor racket became established which would turn out to be the most lucrative business of organized crime in the U.S. in the 1940s and 1950s. The elaborate syndicates of the 1920s did not, however, learn the art of money laundering, and as inconspicuous businessmen who had learned to melt into mainstream society, they proved inferior to the much more sophisticated generation of American gangsters that followed in the 1950s and 1960s.[38]

A Culture of “Going Blank”

The shadow economy of alcohol irrigated a popular party culture which had become the pastime of the young urban business classes shortly before and then after World War I. This culture revolved around public amenities such as the movies, theatres, the new spectator sports (boxing in particular), cabarets, revues, and night clubs, with jazz as the soundtrack of the era. Private dinner parties, on the other hand, only now became a widespread form of the social call and replaced the more formal afternoon tea of Victorian times.

The illicit stuff available deeply imprinted its rough and incalculable qualities on these new forms of sociability. As prohibitionists and the more sober celebrity writers lamented, social life was virtually mesmerized by Prohibition, alcohol, and discussions and gossip related to all forms of psychoactive liquids. Drinking to get drunk as quickly—and as visibly—as possible spilled over from youth culture to the habitual self-celebration of big-city Bohemians. Sometimes parties of young adults rented hotel suites where casks of bootleg alcohol were downed to the sound of a phonograph or a radio. Critics maliciously noted that the enthusiasm of women’s groups like the WCTU for prohibition had resulted in young women joining their male companions in developing a taste for high-powered drink. Most drinking took place, however, in speakeasies, most of which were rather prosaic “filling stations” without any comfort or adornments. These clandestine joints operated under the protection of organized crime gangs and usually were shielded from interference by bribing local politicians and the police. Yet there was always the danger of being raided by zealous new county or state attorneys or by a squad of Prohibition agents who would smash up the interior. This was the reason why most speakeasy proprietors did not care to invest into a lavish décor; on average, a newly opened watering hole had to be operative for no longer than three days to become profitable. As for consumption this meant that most customers did not take their time to be seated but lined up at the long bar, foot on the brass rail, and downed their drinks hastily, other patrons impatiently waiting behind them.

The growing harshness of the trade had swept away all remnants of German-style beer garden culture by the late 1920s. The sobering conditions of illicit drinking for effect under the supervision of the underworld had spread everywhere, as F. Scott Fitzgerald observed in his melancholy reminiscences of 1920s New York City: “Instead there were the speakeasies—the moving from luxurious bars, which advertised in the campus publications of Yale and Princeton, to the beer gardens where the snarling face of the underworld peered through the German good nature of the entertainment, then on to strange and even more sinister localities where one was eyed on by granite-faced boys and there was nothing left of joviality but only a brutishness that corrupted the new day into which one presently went out.”[39]

These somewhat unpolished table manners must be seen in light of the cultural function the pit stops at the speakeasies fulfilled. As wine was hard to get in restaurants or prohibitively priced, and as drinks in night clubs and similar establishments were likewise overly expensive even for well-salaried businessmen, a typical Saturday night “on the town” would consist of a call at a nearby speakeasy to start off with a quick drink, then a visit to a diner or restaurant, followed by another brief stop in the speakeasy as a prelude to the movies, then another stint at the speakeasy before topping off the night in a steaming jazz club. Residents of the low-reputation neighborhoods where illicit drinking establishments clustered complained to social workers that they frequently found helpless society ladies in fur coats and feather boas on their doorsteps in the morning or gentlemen with tilted fedora hats and peed-on gaiters hugging the lampposts. The police were kept busy removing automobiles left behind on Sunday mornings parked queer to the curb.

While the close atmosphere of the night clubs provided a stage for the upcoming jazz—although the gangsters as proprietors were not the most considerate of bosses and did everything to maintain a clear divide between the races—other forms of music suffered. The night clubs themselves were no places to be romanticized. The interior of the top places—such as in midtown Manhattan or in Harlem—was sometimes spectacular but contemporaries described even these as somewhat cheap in taste and a little too loud. The mood not infrequently boiled over as the night went on and blood alcohol levels rose. Fights and spontaneous shootings added a little thrill to the effects of inebriation, especially when gangsters were on the premises as patrons of their own joints. Critics wrote that the night club atmosphere could only be appreciated by someone drunk enough to gloss over all that misery and more than ready to get immersed in the stomping, steaming rhythm of the jazz.[40]

Mission Impossible: Prohibition Enforcement

The Volstead Act was a statutory law designed to punish and not to educate. This was reason enough for opponents when questioned about the origins of National Prohibition’s failure. This absolutely restrictive approach to Prohibition was the more problematic as section 2 of the 18th Amendment decreed that “Congress and the several states shall have concurrent power to enforce this article by appropriate legislation.” The debates about the meaning of the “concurrent” clause soon filled volumes in law libraries, but it was at best a decidedly “un-American” constitutional arrangement in a system which normally clearly separated federal and state rights and vested the federal government only with powers explicitly granted by the Constitution. Disputes about infringement on states’rights accompanied National Prohibition to its very end. In practice, it came down to two legal consequences which contributed to a growing animosity against the 18th Amendment: first, the states were forced to adopt state prohibition codes of their own which might be considerably tougher than the Volstead Act but could not be “softer.” Second, the states did not necessarily have to cooperate with federal agencies in enforcement activities but they could not prevent interventions of these agencies on their territory, much like nations occupied by a foreign military force.

The immediate effect was that a wide cleavage opened up between states which continued enforcing harsh regulations from pre-Prohibition times or adopted rigid new state laws and those which obstructed the amendment. Whereas already the possession of a pint of whiskey could result in lifelong imprisonment in states such as Michigan, New York revoked its state prohibition law after it was declared unconstitutional in 1921 and never drafted a new one. Nevada, Montana, and Wisconsin followed suit later in the 1920s while Rhode Island, never having ratified the 18th Amendment, refused to enact requisite legislation. Kansas and Michigan, on the other end of the spectrum, introduced a “three-strike rule” which meant a life sentence after the third violation of the state code.[41]

The U.S. Supreme Court and the states’ highest courts upheld even the most drastic decisions and did their share to let the legal pendulum swing towards repression where the rights of the individual were concerned. The Supreme Court effectively suspended the “due process” clause, the protection against “unreasonable search and seizure,” and the interdiction of “double jeopardy” in the Bill of Rights when it declared legal that a person could be charged and sentenced by both a federal and a state court for one and the same violation. The Supreme Court defined a garden as not belonging to the home of a person and alcohol found there was, consequently, illegal. The tapping of telephone lines was no infringement on the private sphere of citizens, according to the judges, because they considered the network a part of the public sphere. A car likewise was public space, and keeping a hip flask on the passenger seat to have it handy when traffic got heavy constituted “transportation” and violated the Volstead Act. Only towards the end of the 1920s, when the ineffectiveness of enforcement had become obvious and scandals about the abuses of Prohibition agents accumulated, did the Supreme Court backpedal and resume strengthening the rights of the individual against an enforcement regime gone wild.[42]

Most states pointed to the “concurrent power” clause when charged with their lack of cooperation in day-to-day enforcement on the state level. Even the driest states preferred to shift responsibility to the federal agencies and shied away from the potential expenditures for a state liquor police. This does not mean that in these often militantly prohibitionist states the ban on alcohol was not enforced. Yet it was more a matter of local police, drawing on city ordinances as much as on the state and federal laws, and this turned into a very nit-picking, rancorous form of enforcement imbued with longstanding ethnic or racist resentments.

The federal government commissioned the U.S. Customs Service and the U.S. Coast Guard with sealing off the nation’s borders against the illegal importation of alcohol. Although the budget for Customs increased tenfold between 1921 and 1927, the agency became so overburdened with Prohibition issues that it neglected its usual duties. The Coast Guard mutated from a naval life-saving organization into a veritable “liquor navy” with (in 1929) an armada of 25 destroyers, 33 cruisers, and 346 pieces of naval artillery. Nevertheless, this proud fleet did not succeed in curbing the inflow of contraband when “Rum Row” shifted location and confiscations decreased by two-thirds between 1925 and 1927.[43]

To tackle the main task of federal enforcement the government at first established a modest Prohibition Unit inside the Bureau of Internal Revenue that was subsequently shifted over, in 1930, to the Department of Justice. Originally the agency was conceived as a propaganda and coordinating force whose activities were supposed to focus on the cooperation with state enforcement and local authorities. Since this cooperation was virtually non-existent, the Bureau of Prohibition shifted to pursuing ordinary police work. This was an impossible undertaking, given that the number of active agents in the field never exceeded roughly 2,800 for the whole of the United States. Since pay was lousy and the positions exempt from civil service provisions, the jobs attracted mostly political protégés, odd jobbers, and entrepreneurial minds eager to exploit the bonanza of bribery which beckoned along the borders of this vaguely-defined profession. The agency very soon earned a reputation for ignorance and incompetence. Regional subunits were very active, repeatedly raiding zones and establishments the local police had ignored or refused to attack. They quickly brought the federal courts to a choking halt by flooding them with mostly minor Prohibition cases. Yet enforcement of this kind remained erratic, imbalanced, biased, disproportionate, and unsustainable. Ill-trained and badly equipped, Prohibition agents lacked the adequate procedures and clear objectives of their performance. Soon the public regarded them as “trigger happy.”[44] When the Hearst newspaper empire switched sides in 1929 and aligned with the anti-Prohibitionists, gloomy cartoons by Winsor McKay and editorials by William Randolph Hearst himself charged the Prohibition agents with the murder of more than 1,360 innocent bystanders. The Prohibition agency increasingly became identified with “shotgun enforcement.” Public blame for the agency and its scandals contributed much to the turn of sentiment against Prohibition after 1928.

The Swing towards Repeal

When National Prohibition became the law of the land, the Prohibitionist position, as embodied by the Anti-Saloon League and the Woman’s Christian Temperance Union, totally dominated the public discourse. “Personal liberty” arguments against the ban had become unspeakable. Even the remaining “wet” press kept a low profile. Jumping onto the Prohibitionist bandwagon served many journalists as a way to display moral qualification in order to make a career. Criticism first popped up in the guise of concerned citizens bringing up the painful shortcomings of enforcement or other concrete aspects of Prohibition with the insinuated intention to improve these matters. In the mid-1920s, a more satirical treatment of Prohibition issues gained ground, especially in the sophisticated glossy East Coast magazines that aspired to entertain a readership most likely mingling in Prohibition culture. The accumulating scandals and stories about the grotesque absurdity of many Prohibition affairs provided the “stuff from which news is made,” but even more important was the obsession and intensity with which the American public debated Prohibition: “In every newspaper every day of the year, on every street corner where people stop to talk, at every afternoon tea party, in every social gathering of any kind involving any class of society, one subject recurs time after time and is of universal interest: Prohibition,” Mabel Walker Willebrandt, the assistant attorney general responsible for the legal handling of Prohibition until 1929, lamented. “No political, economic or moral issue has so engrossed and divided all the people of America as the prohibition problem, except the issue of slavery.”[45]

The Anti-Saloon League tried everything possible to keep the Prohibition debate out of politics—and sometimes a little more. At the same time its leaders, Wheeler and F. Scott McBride, showed the utmost intransigence when confronted with proposals to modify the Volstead Act slightly to permit light beers and wine, pointing to the constitutional enactment of the ban as if it were cast in concrete for eternity. The American public, on the other hand, did consider Prohibition a political issue, and the anti-Prohibitionists continually protested that the American people had had no say in the question of its implementation.[46] From 1922 on, the highbrow general-interest magazine Literary Digest conducted unofficial and non-representative public opinion surveys, so-called “straw polls,” on the question of Prohibition. Five “straw polls” between 1922 and 1932 gave the American public the opportunity to express its sentiment on the “wet” and “dry” issue, asking millions of American households by written ballot whether they favored “enforcement,” “modification,” or outright “repeal” of the 18th Amendment. Not surprisingly, the 1922 straw poll produced majorities for “enforcement” in all but the “wettest” regions of the nation—yet it also signaled that there was an opposition in even the most “arid” parts of the country and that, taken together, in such places small majorities, splitting votes between “modification” and “repeal,” were at least not willing to consent to the status quo. Surprisingly large numbers of returns indicated, furthermore, that Prohibition indeed was a hot political issue.

 The Literary Digest “straw polls” were correctly seen as an informal plebiscite on Prohibition. This divisive issue propelled the complete rearrangement of the political parties in the U.S. Whereas the ASL succeeded in largely subduing it as a campaign issue in the presidential elections of 1924, the 1928 candidacy of Democratic New York Governor Alfred E. Smith, Irish, Catholic, and self-proclaimed “wet,” signaled that the Democratic Party was drifting towards the anti-Prohibitionist camp. The politicization of second-generation, working-class immigrants in the big cities of the East Coast and the industrial Midwest—mostly over the issue of Prohibition—profoundly changed the structure and profile of the Democrats. The 1928 elections were clearly a matter of “wet” or “dry” since the Republican candidate Herbert C. Hoover, in contrast to his predecessors Harding and Coolidge, left no doubt about his “dry” convictions. A cartoon aptly boiled the Presidential race of 1928 down to the alternative “H2Oover” or “A.L.E. Smith.”[47] Smith lost in the election because he was too Irish, too Catholic, and too “wet” for the taste of the traditionally Democratic “solid South.” Yet the overall figures disguised that Smith stood for the far-reaching reconfiguration the Democratic Party was undergoing on its way to becoming a more Northern, working-class, minority, and “wet” party: “Governor Smith demonstrated his strength as a vote-getter by winning a larger popular vote, as the losing candidate, than any other Democratic Presidential candidate, successful or unsuccessful,” Literary Digest noted.[48] The German minority was among those ethnic groups responsible for the big city swing towards the Democrats which was foremost an act of opposition against National Prohibition. In certain New York voting districts citizens of German descent supported Smith in 1928 with 73 percent of their votes (the trend is clear: 1920 = 28 percent, 1924 = 46 percent, 1932 = 80 percent). In Chicago, shifts of votes of similar proportions were registered.[49]

Printed public opinion followed the changing tide. The Hearst press, for long years staunch supporters of Prohibition, which Hearst himself had welcomed in 1920 as “heaven sent,” defected to the “repeal” camp after the St. Valentine’s Day Massacre on February 14, 1929—the mass execution of Chicago North Side gangsters by St. Louis–based killers hired by the Capone syndicate. The straw poll in 1930 surpassed everything in terms of returns that was known in public opinion polling so far. The number of incoming ballots totaled 4.8 million—considerably more than for the poll before the Presidential elections in 1928. Now—with typical regional variations—a majority of 40.4 percent advocated outright “repeal” with 30.5 percent still sticking to “enforcement.” Another wave of Americans defected after the publication of the report of the Wickersham Commission in January 1931. Following a long and highly publicized research process, covering all corners of the nation, the commission had come up with lukewarm conclusions and its members polarized over suggested recommendations. Hoover involuntarily triggered a decisive outcry of public indignation against Prohibition, however, when he declared the report as an expression of outright support for his rigid course of enforcement. By 1932 the preponderance of the “repeal” vote had grown to overwhelming proportions in Literary Digest’s straw poll, in part because the category “modification” had been stricken from the ballot in a reaction to the intransigence of the ASL and the Hoover administration.[50]

Hoover quickly became one of the most unpopular presidents in U.S. history. A self-declared expert in economic matters, he displayed a “hands-off” approach to the Great Depression which the swelling ranks of the bankrupt, unemployed, and homeless found disturbing. Compared to this detachment the passionate, highly ideological way Hoover threw himself into the breach for Prohibition appeared even more unacceptable. Hoover became more and more isolated even in his own party as he sided with the most radical “dry” wing, still fired up by an Anti-Saloon League whose stubborn militancy more and more sounded simply shrill and hysterical. Prohibition in practice caused the ASL to lose all legitimacy for its position that had once drawn bipartisan support. Now competent and well-financed interest groups, much better suited to fulfill the requirements of the modern media culture, lobbied for “repeal.” The Association Against the Prohibition Amendment soon outdistanced the League in media attention, as did the Women’s Organization for National Prohibition Reform (WONPR) whose leading personalities, such as the urbane and glamorous Pauline Morton Sabin contrasted favorably with the dry and sanctimonious spokeswomen of the WCTU. These organizations pushed the argument that the presidential elections of 1932 would be a referendum on National Prohibition. Despite the horrors of the Great Depression, Prohibition remained the most important and decisive campaign issue—even if Franklin D. Roosevelt was rather late to embrace the “wet” plank of his party platform wholeheartedly.[51]

Prohibition and the German-American Experience

The long-term effect of Prohibition for the Americans at large was a degeneration of beer culture which has only cautiously been reversed since the first microbreweries opened in the 1980s. Yet Americans’ relationship to alcohol has remained uptight until today. It is not too much to say that the Germans were among the immigrant groups that suffered most from the onslaught of the temperance movement and from the enactment of National Prohibition. Although the role of brewers of German descent in the self-inflicted saloon crises was considerable and their attempts to defend themselves clumsy and self-defeating, they had to sustain severe losses when the beer trade became illegal, driving a part of the brewery owners to the brink of illegality themselves—or beyond. The big breweries such as Anheuser-Busch, Miller, and Schlitz, barely survived the thirteen “dry” years.

Yet there was more at stake for the German minority under the reign of Prohibition. German immigrants had been particularly successful in becoming part of the American mainstream while nevertheless maintaining a quantum of “Germanness” before World War I. The owners of the big breweries who also left a visible architectural and organizational imprint on cities such as Milwaukee—see, for instance, the Milwaukee City Hall—had self-consciously attempted to spread a measure of German civic culture and actually make the American mainstream a little more Germanic. Part and parcel of this endeavor had been the establishment of beer gardens and a civilized, convivial drinking culture that was an alternative to the raucous and violent saloon. The Prohibitionist movement, in turn, ostracized the Germans precisely on account of their “Germanness”—and turned them back into an ethnic minority. Prohibition completely wiped out the beer-garden culture and paved the way for cheap speakeasies even worse than the most degenerate saloons.

It is said that the ascent of the bootlegging industry and the creative role of organized crime in this project contributed to the upward mobility of second-generation Italians, Irish, Eastern Europeans, and Jews who made a career as gangsters well-respected by a largely sympathetic public—until the mood changed dramatically after the St. Valentine’s Day Massacre in February, 1929. These second-generation immigrants gained access to the American mainstream profiting from Prohibition precisely when the Germans were being driven to the margins of the mainstream on account of the Prohibitionist movement. The Germans had no visible part in gangland, with rare individual exceptions like Dutch Schultz—a signal of their success in assimilation the decades before the dry era. Their best chance to rescue some of their German-American culture was to maintain a low profile and orient their lives around small community circles.

The tide against Prohibition turned late but thoroughly. Roosevelt’s election dealt it the final blow—whether the new President wanted to be inaugurated as a “wet” or not. One of his first bills he signed, the Beer and Wine Revenue Act, modified the Volstead Act to re-legalize beer with an alcohol content of 3.2 percent and re-established federal excise taxes on alcohol that were much needed in the times of the Great Depression. On midnight, April 7, 1933, Americans could enjoy their first legitimate “schooner” of beer again after thirteen years of scarce, expensive, and horrible black-market stuff.

Notes

[1] Hoover campaign speech, August 11, 1928, quoted in Public Papers of the Presidents of the United States: Herbert Hoover, 1929 (Washington, D.C.: Government Printing Office, 1974), 511.

[2] William J. Rorabaugh, The Alcoholic Republic: An American Tradition (New York: Oxford University Press, 1979).

[3] See the Prohibition Party web site (accessed Feb. 1, 2013).

[4] All financial comparisons are made using the U.S. Purchasing Power Calculator, available at MeasuringWorth.

[5] Thomas Welskopp, Amerikas große Ernüchterung: Eine Kulturgeschichte der Prohibition (Paderborn: Schöningh, 2010), 408.

[6] Quoted in John Kobler, Ardent Spirits: The Rise and Fall of Prohibition (New York: Da Capo Press, 1993), 182.

[7] Welskopp, Amerikas große Ernüchterung, 59.

[8] Ibid., 33–50.

[9] As it happened, this reapportionment did not end up occurring, a unique incident in American history.

[10] Ute Engelen, “Auswanderung von Mainzer Bierbrauern in die USA,” in Frisch vom Fass – Geschichte des Bierbrauens in Mainz, ed. Hedwig Brüchert and Ute Engelen (Mainz: Stadthistorisches Museum Mainz, 2012), 84–85.

[11] Christine Sismondo, America Walks into a Bar: A Spirited History of Taverns and Saloons, Speakeasies and Grog Shops (Oxford, Eng.: Oxford University Press, 2011), 128–29.

[12] Günter Schmölders, Die Prohibition in den Vereinigten Staaten: Triebkräfte und Auswirkungen des amerikanischen Alkoholverbots (Leipzig: Kohlhammer, 1931), 60.

[13] Amy Mittelman, Brewing Battles: A History of American Beer (New York: Algora Publishing, 2008), 48–50; Sismondo, America Walks into a Bar, 103–5.

[14] Daniel Okrent, Last Call: The Rise and Fall of Prohibition (New York: Scribner, 2010), 102–103.

[15] Quoted in James Morone, Hellfire Nation: The Politics of Sin in American History (New Haven, Conn.: Yale University Press, 2003), 309.

[16] Schmölders, Prohibition, 223–25.

[17] Clark Warburton, The Economic Results of Prohibition (New York: Columbia University Press, 1932), 93.

[18] Jeffrey A. Miron and Jeffrey Zwiebel, “Alcohol Consumption During Prohibition,” American Economic Review 81 (1991): 242–47, here 242.

[19] Quoted in Schmölders, Prohibition, 208.

[20] Carl Raushenbush, review of The Economic Results of Prohibition, by Clark Warburton, American Economic Review 23 (1933), 356–57.

[21] Rufus S. Lusk, “The Drinking Habit,” in Prohibition: A National Experiment, ed. James H.S. Bossard and Thorsten Sellin, Annals of the American Academy of Political and Social Science 163 (1932): 46–52, here 52.

[22] David Cort, “Mother Volstead’s Chickens: A Sympathetic Inquiry Into Why Drinking Americans Broach the Synthetic Vintages of 1929,” Vanity Fair, Sep. 1929, 92, 128.

[23] Okrent, Last Call, 198–99.

[24] Welskopp, Amerikas große Ernüchterung, 158.

[25] Schmölders, Prohibition, 224–25.

[26] William J. McFadden, The Law of Prohibition. Volstead Act Annotated: Rules of Law Governing Practice and Procedure in the Federal Courts and Practice Forms (Chicago: Callahan & Co., 1925), 768.

[27] Schmölders, Prohibition, 184–85; Mabel Walker Willebrandt, The Inside of Prohibition (Indianapolis: Bobbs-Merrill, 1929), 85.

[28] Warburton, The Economic Results of Prohibition, 33, 71–72.

[29] Quoted in Okrent, Last Call, 170.

[30] Cort, “Mother Volstead’s Chickens,” 92.

[31] Welskopp, Amerikas große Ernüchterung, 150–52.

[32] Lemar T. Beman, Selected Articles on Prohibition: Modification of the Volstead Law (New York, 1924), 153.

[33] Thomas Welskopp, “‘Die im Dunkeln sieht man nicht’: Systematische Überlegungen zu Netzwerken der Organisierten Kriminalität am Beispiel der amerikanischen Alkoholsyndikate der Prohibitionszeit,” in Unternehmerische Netzwerke. Eine historische Organisationsform mit Zukunft?, ed. Hartmut Berghoff and Jörg Sydow (Stuttgart: Kohlhammer, 2007), 291–317.

[34] National Commission on Law Observance and Enforcement, Report on the Enforcement of the Prohibition Law of the United States (Washington, D.C.: Government Printing Office, 1931), 37.

[35] Humbert S. Nelli, The Business of Crime: Italians and Syndicate Crime in the United States (New York: Oxford University Press, 1976), 173.

[36] For a Chicago example, see Welskopp, Amerikas große Ernüchterung, 373–375; these relationships were also found in many other eastern cities from Boston to Baltimore as well as in the industrial Midwest from St. Louis to Pittsburgh.

[37] Mark H. Haller, “Illegal Enterprise: A Theoretical and Historical Interpretation,” Criminology 28.2 (1990): 207–35, esp. 229.

[38] Graham Nown, The English Godfather (London: Ward Lock, 1987), 10; Gus Russo, The Outfit: The Role of Chicago’s Underworld in the Shaping of Modern America (New York: Bloomsbury, 2001), 67–69.

[39] F. Scott Fitzgerald, “My Lost City (1935/1940),” in F. Scott Fitzgerald, My Lost City: Personal Essays, 1920–1940, ed. James L.W. West III (Cambridge, Eng.: Cambridge University Press): 106–15, here 113.

[40] Bruno W. Peretti, Nightclub City: Politics and Amusement in Manhattan (Philadelphia: University of Pennsylvania Press, 2007), 140–67.

[41] Welskopp, Amerikas große Ernüchterung, 92–94.

[42] Ibid., 73–5.

[43] Ibid., 528–9.

[44] Laurence F. Schmeckebier, The Bureau of Prohibition: Its History, Activities, and Organization (Washington, D.C.: Brookings Institution, 1929), 53.

[45] Willebrandt, The Inside of Prohibition, 15–17.

[46] Howard Lee McBain, Prohibition Legal and Illegal (New York: Macmillan, 1928), 14.

[47] Welskopp, Amerikas große Ernüchterung, 552–56.

[48] “What Hoover’s Smashing Victory Means,” Literary Digest, Nov. 17, 1932, 6.

[49] Welskopp, Amerikas große Ernüchterung, 555.

[50] Ibid., 461–75.

[51] Ibid., 568–80.

 

Cite this Entry

APA Style

"Prohibition." (2017) In Immigrant Entrepreneurship, Retrieved April 24, 2017, from Immigrant Entrepreneurship: http://www.immigrantentrepreneurship.org/entry.php?rec=87

Chicago Style

Welskopp, Thomas. "Prohibition." In Immigrant Entrepreneurship: German-American Business Biographies, 1720 to the Present, vol. 4, edited by Jeffrey Fear. German Historical Institute. Last modified March 17, 2015. http://www.immigrantentrepreneurship.org/entry.php?rec=87

MLA Style

"Prohibition," Immigrant Entrepreneurship, 2017, Immigrant Entrepreneurship. 24 Apr 2017 <http://www.immigrantentrepreneurship.org/entry.php?rec=87>

New York City Deputy Police Commissioner John A. Leach, right, watching agents pour liquor into sewer following a raid during the height of prohibition

  • Prohibition officers raiding the lunch room of 922 Pa. Ave., Washington, DC
  • Man Pouring Wine into Sewer, 1933
  • Wayne B. Wheeler, 1920
  • Pabst Park beer garden, Milwaukee, 1903

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