It has long been the belief of policymakers that it is the role of government to ensure the general health of the public in order to head off moral hazard. As great as that may sound on the surface, preventive policies, especially prohibition laws which criminalize victimless actions, often have the opposite effect. By this, I mean that they are, in fact, responsible for creating public health crises and engendering moral hazard. The intent of the Eighteenth Amendment was to mitigate poor health due to alcohol consumption, prevent the disintegration of American nuclear family units, reduce crime and public corruption, and to reduce the burden borne by taxpayers to fund the increasing populations of prisons and public poorhouses.
Of course, history tells us that Prohibition was nothing less than an epic failure. Not only did illegal alcohol consumption approximate pre-Prohibition levels, the quality control inherent in a legal, private marketplace did not exist, resulting in wide divergences in potency and quality. Home distilleries arose, as did the amount of alcohol produced by pharmacies and religious organizations, both of whom enjoyed legal exceptions. A favorite ploy of bootleggers was to establish or partner with established pharmacies to produce “medicinal” alcoholic products. In addition to the “normal” run of alcohol related deaths, roughly 1000 Americans died each year during Prohibition from tainted and poisoned alcohol. As the pace of enforcement under the Volstead Act increased, it became ever more lucrative to bring alcoholic beverage to the market by any means necessary, increasing the spread of tainted liquor throughout society.
Moreover, the criminalization of alcohol created a market for even more dangerous substitutes. Consumption of substances such as cocaine and opioids increased; while these substances had been rendered virtually illegal by the Harrison Narcotics Tax Act of 1914 (which required non-prescribed possession of subject to taxation and licensure), they were not terribly difficult to obtain. In essence, the Eighteenth Amendment succeeded in increasing two concurrent black markets. As a quick aside, increases in the acquisition and usage of illicit drugs still shows a positive correlation with State and local alcohol prohibition today. This is, perhaps somewhat predictably, a case of misguided public policy causing two problems for the price of one.
Not only did Prohibition fail, over the long-run, to decrease the overall consumption of liquor, it also failed to decrease taxpayer burden, the prison population, and public corruption. As a matter of course, all of these things increased under the scope of the Eighteenth Amendment. According to Mark Thornton of Cato and Auburn University, crime in general increased some 24% in the 30 largest cities between 1920 and 1921, while the homicide rate during the Prohibition Era was 78% higher than in the decade preceding it. Naturally, an increase in the rate of crime corresponded with an increase in money spent on enforcement, and an increase in the number of inmates processed throughout the prison system.
Between the passage of the Harrison Act in 1914 and the repeal of the Eighteenth Amendment in 1933, the number of individuals convicted of a federal crime rose from 4,000 to 26,589, an increase of 566%. A clear majority of these individuals were not housed in federal prisons, but in state or local facilities, increasing the burden of taxpayers not only as a function of cost, but community as well. During this period, federal expenditures on prisoners alone rose some 1000%, as state and local prisons were remunerated and new facilities were built. Additionally, expenditures on policing increased by more than 11% during this period. Clearly, there was no easement on the burden of taxpayers in regard to decreasing the prison population.
Because of the large profit margins enjoyed by the most organized black-market cartels, public corruption also increased during this era. Politicians, policemen, and policymakers were all known to accept bribes and gifts from bootleggers, speakeasy owners and crime lords. Ironically, the entity most susceptible to corruption was the federal Bureau of Prohibition, the agency specifically created to enforce the provisions of the Volstead Act. Graft within the Bureau was widespread enough that its own commissioner, Henry Anderson deemed the whole program a fruitless exercise that created public disregard for the law.
Ironically, both alcohol consumption and crime had significantly decreased on their own in the decade immediate preceding passage of the Eighteenth Amendment. Not surprisingly, they decreased in the decade following its repeal. Tragically, current public policy seems to have gathered nothing from the mistakes of this well-publicized era in our history, and has taken us down this same path with the prohibition of drugs.
This is meant to be the first in a series highlighting the problems of our current drug policy. Next, we will look at some of the parallels between the Eighteenth Amendment and the War on Drugs, as well as its negative social costs.