Thursday, August 02, 2007

How Prohibition ended

Don Boudreaux has written an interesting piece on the subject of alcohol prohibition. His thesis is at variance from the usual story of Prohibition being ended because people got tired of the violence, gangsterism and futility of Prohibition. Instead, he suggests that the coming of the income tax in 1913 created an environment in which it was feasible to think about Prohibition, since before 1913 about a third of federal revenues came from taxes on alcohol. By 1920 the income tax was providing nine times as much revenue as liquor taxes, so giving up liquor tax revenue didn't seem unthinkable.

With the coming of the Great Depression, however, revenue from income taxes declined precipitously and Uncle Sam started casting about for other sources of boodle. Legalizing liquor and taxing it started to look attractive.

Don's conclusion is rather dispiriting: "So, if the history of alcohol prohibition is a guide, drug prohibition will not end merely because there are many sound, sensible and humane reasons to end it. Instead, it will end only if and when Congress gets desperate for another revenue source." Hardly encouraging, but it may be realistic.

That doesn't mean I'll stop agitating and arguing for an end to drug prohibition for all the proper "sound, sensible and humane reasons." But it might mean, however much I hate taxes and would prefer to see drugs untaxed as well as legal, that I may emphasize a little more often that marijuana (for example) is the U.S.'s Number One cash crop and that it would be better for it to be a source of revenue than the object of futile spending and cruel enforcement mechanisms.

1 comment:

Mike Freitas said...

Is anything we "know" true?