18 Jun Cost Of Sobriety
When out-of-towners descend upon Chicago for a night out on the town, they are generally surprised at the cost of a drink. It helps, though, if you think about what it cost Chicago to be sober (allegedly) during Prohibition. Sobriety took a far tougher toll on the economy than a night out in Chicago on your wallet.
There’s really nothing sexy about economics, but the impact of Prohibition on the nation’s economy gets pretty damn close. Of course, the elected officials and dry-law supporters didn’t have the benefit of the hindsight we have. So, let’s start where Prohibition ends…
1932—Constituents that had been largely indifferent to Prohibition began writing their elected officials begging for relief. Farmers that had once grown barley, rye, and hops are drowning in debt with no relief in sight. Families are starving, the nation’s great experiment has failed and Prohibition has cost the nation billions of dollars it now desperately needs just to keep people alive.
October 29, 1929—The Roaring Twenties come to a disastrous end, the stock market utterly collapses and the Great Depression begins. Sure would be nice to have a drink now, wouldn’t it? Alas, the nation is still dry while people jump out of windows on Wall Street.
1927-1928—President Coolidge cuts federal defense spending and increases federal Prohibition enforcement spending. The World War is over and it’s not like America is ever going to find itself in another major international conflict, right? Europe is fine, what could possibly go wrong? Instead, $300 million is spent enforcing Prohibition.
Mid 1920’s—Turns out the industries that were expected to thrive under Prohibition like soda, theater, and retail tank. Supporters of Prohibition thought that people would spend more money on pure forms of entertainment when they stopped spending their money on booze. Turns out, even in 1920-something, no one wanted to see live theater without a drink before the show.
1921—Who knew legal alcohol accounted for $11 billion in tax revenue? Money is still being spent on alcohol, of course, but now they are paying the gangsters rather than saloon owners that would have been taxed. We all know how reliable Capone is about filing his tax returns and accounting for that income.
1920—Industries begin to fail. When Prohibition becomes law, alcohol is the fifth largest industry in the nation. Immediately, legitimate saloons are out of business, as are alcohol manufacturers and their employees. Restaurants stop making profits because they can no longer markup the price of liquor. People generally tip better when they are drunk, and waiters begin to lose their jobs. Truckers and barrel makers also begin to lose their jobs without alcohol supporting the industries. But that’s okay, President Coolidge tells the nation that money will be better spent propping up other industries.
1919—We show up from one hundred years in the future and convince the nation not to ratify the 18th Amendment. But then Chicago’s history wouldn’t be what it is and we’d be bored and out of a job.
Written by Amy Williams