Why did Prohibition end?

While most accounts trace prohibition’s demise to widespread noncompliance and the graft it generated, we argue that elite congressional support for prohibition gave way when civil service reforms removed federal prohibition agents as patronage resources. We also argue that by giving states control of designing state conventions, and thereby risking state malapportionment of conventions, Democrats succeeded in overcoming the traditional fissures that divided their southern and northern wings.

That is from a new paper by Aaron J. Ley and Cornell W. Clayton.  Maybe I got this from somewhere on Twitter?


You can always frame a narrative in a strange way, as in the knife victim 'backed into' the knife rather than was stabbed.

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"most accounts trace prohibition’s demise to widespread noncompliance and the graft it generated": that's a strange argument. Are they suggesting that Congressmen were jealous of graft that did not adhere to them?

Graft may not be the best term - criminal gangs using violent means as part of their business model is probably a bit more accurate in the sense of what was influencing politicians.

Or the fact that most of them drank too - 'In October 1930, just two weeks before the congressional midterm elections, bootlegger George Cassiday—"the man in the green hat"—came forward and told members of Congress how he had bootlegged for ten years. One of the few bootleggers ever to tell his story, Cassiday wrote five front-page articles for The Washington Post, in which he estimated that 80% of congressmen and senators drank. The Democrats in the North were mostly wets, and in the 1932 election, they made major gains. The wets argued that prohibition was not stopping crime, and was actually causing the creation of large-scale, well-funded and well-armed criminal syndicates.' <a href="https://en.wikipedia.org/wiki/Prohibition_in_the_United_States#Bootlegging_and_hoarding_old_supplies"https://en.wikipedia.org/wiki/Prohibition_in_the_United_States#Bootlegging_and_hoarding_old_supplies

More interesting are rules adopted by the states as part of the end to prohibition that continue in effect today. Some are obvious (no Sunday sales), but some are not. For example, the three-tier distribution system: distiller (producer, importer), wholesaler (distributor), and retailer. Why the mandatory wholesaler? After all, it just adds a layer of markup. The stated purpose of the three-tier system is that it gives the state greater control over the distribution and sale of alcohol. But it also serves a very basic function: it facilitates the imposition and collection of taxes. Indeed, in many states, the wholesaler (distributor) is the state itself, and in some cases the state is both exclusive distributor and exclusive retailer. Not surprisingly, the distributor trade organization opposes initiatives to alter the three-tier system. Of course, what this means is that the retail customer pays a higher price for alcohol. That may not be such a bad thing, but that's not the purpose of the three-tier system.

You can just tax the sales at the retail layer.

I believe the concern was bootlegging - states cannot collect tax on sales that are never reported. By controlling distribution (indeed, by being the distributor in many cases), it reduced the risk of bootlegging. On a broader level, why would government wish to have a monopoly on the issuance of currencies. To control "bootlegging". Cryptocurrencies, anyone? The combination of "bootlegging" (in alcohol, drugs, weapons) and cryptocurrencies is a libertarian's dream.

An estimate $8.7 trillion in assets is held by the ultra-wealthy in hidden (offshore) accounts on which they pay no taxes. Gabriel Zucman, The Hidden Wealth of Nations. Poor Al Capone never had it so easy.

Bootlegged spirits likely weren't going to travel through taxable channels anyway, so I'm not sure why this would be a rationale for government distribution.

Because anyone retailing liquor will have to buy from the favored distributors, this means only a few or even a single source. This makes it very easy to check on retailers, if you find any product or transactions not from or with the approved distriutors you have bootleg liquor.

Unless that retail layer is entirely owned by the state, as is the case in Alabama, Idaho, New Hampshire, North Carolina, Pennsylvania, Utah and Virginia. Then there's no need for a retail tax, as the state gets all the retail profit anyway.

And the state liquor stores usually are profitable even when their prices are at or below what's available over the state line at a for-profit store. For with no in-state competition, there's no need to make the stores attractive or offer extended hours. Let alone waste money on advertising.

More interesting for purposes of the study is that before national prohibition, a majority of the states had enacted prohibition. Repealing national prohibition, didn't repeal any state laws, though that would follow independently over time.

Attributing repeal to "elite congressional support" seems to overlook the difficulties of both passing an Amendment with broad federal and state support, as well as independently getting states to repeal their own state prohibition laws. To me this all points to broad popular support for repeal, not elite contrivance, though there could be both!

It's interesting that "widespread noncompliance and the graft it generate[s]" has not yet ended immigration prohibition either. Of course, immigration prohibition and alcohol prohibition are somewhat different. Immigration, otherwise known as working and living, are considered unambiguously good when natives do it. In contrast, alcohol does have some negative effects. Still, it's worth considering whether the ending of alcohol prohibition provides some clues about how we might transform black market and bootlegged immigration into free market immigration.

"civil service reforms removed federal agents as patronage resources"

Can anyone elaborate on this?

Chicken Or Egg question?

of course the 18th/21st Amendments were totally unnecessary from a de facto federal legal standpoint -- Congress can prohibit/control whatever it chooses, for any or no reason.

Current tyrannical federal controls on weed/opiates/etc and thousands of chemicals/drugs ... required no Constitutional amendments at all -- Congress simply assumed that authority.

Congress could "legally" prohibit peanuts & door-knobs tomorrow, if it felt like it. The precedent for vast arbitrary federal powers has been well established now.

The Ken Burns film isn't reference-grade but it's a good outline. One Wayne Wheeler was a master political operator; the "pro" faction was a lot rual "real Americans" against the more-immigrant cities and the tide swept the freshly Suffraged woman vote ( and not for no reason ) .

One watermark was the St. Valentine's Day Massacre. People aren't stupid. They put two and two together. It wasn't hard to see that Al Capone "ran" Chicago.

It’s very simple.

The Feds wanted the tax revenue.


If it's that simple, can you explain why prohibition was passed in the first place? Or why so many taxable goods (like marijuana) remain banned, federally? Did the Feds not want tax revenue in 1917? Do they want some of it now but not all of it?

People got tired of being shot because they sold the wrong beer company's products.

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