The day crime got organised
100 YEARS SINCE START OF AMERICA’S PROHIBITION
At 12.01am 100 years ago today the United States became alcoholically arid, bereft of booze and liquor in any form. The era of Prohibition had begun thanks to the Volstead Act and attempts to buy alcohol could land people in jail.
The “noble experiment” was supposed to turn the US into an abstinent nation, reduce crime and corruption, boost the economy and improve health.
Reformers promised theatres and restaurants would be full, house prices would rise as neighbourhoods improved and sales of fizzy drinks would soar.
Minutes after midnight six masked raiders stole £117,000-worth of whisky from a train in Chicago, before a second gang took grain alcohol from a government bonded warehouse, and a third hijacked a truck packed with bourbon.
These booze-related crimes would boom into a bullet-ridden business.
Even those who doubted the wisdom of the policy never imagined how catastrophic it would be, with the effects still felt today.
The next almost 14 years led to a sharp increase in alcohol consumption, thousands of deaths from drinking illegal booze – and the rise of some of America’s most notorious gangs.
Organised crime, never before heard of in the US, took hold of its cities.
While gangs had been active since the late 19th century in New York and Chicago, they had mostly been street thugs running small-time extortion and loansharking rackets.
But after Prohibition the gangs quickly learned how to profit from the nation’s thirst for illegal booze.
With cash piling up, they had to hire lawyers and accountants to launder their ill-gotten gains. They also had to negotiate partnerships with other gangs, and organise shipping logistics and property investment, quickly becoming more powerful than the politicians and police.
“They had to become businessmen,” explains Howard Abadinsky, criminal justice professor at St John’s University, New York, and author of Organised Crime.
“In the absence of Prohibition, we wouldn’t have had the kind of syndicated criminality that occurred. Prohibition was the catalyst,” he adds.
Gangsters had recognised the golden opportunity long before the law was enacted on January 16, 1920, and in cities criminals had been stockpiling bottles for months.
They supplied bootleg booze to the hundreds of thousands of unlicensed bar rooms – named “speakeasies” because of how low you had to speak a password so as not to be overheard by law enforcement.
Before long the gangs were smuggling in liquor over the ocean or lakes from Britain and Canada, known as “rum running”.
By employing redundant brew masters, boat captains, truckers and warehousemen, as well as armed thugs known as “torpedoes” to intimidate, injure or kill competitors, and bribing police and prohibition agents to look the other way, they ensured Americans had a never-ending supply of the good stuff.
Much of the liquor brewed by amateur bootleggers tasted foul, so speakeasies began to mix alcohol with ginger ale, Coca-Cola, sugar, mint, lemon, fruit juices and other flavourings, creating the cocktail.
One of the first gangsters to build a huge empire from prohibition was New York racketeer Arnold Rothstein, whose agents had been responsible for rigging the 1919 baseball World Series.
One of the US’s richest mob bosses, he amassed an estimated £11.7million – £100million today – selling smuggled booze to gangs running the city’s estimated 100,000 speakeasies. In November 1928 he was found at the entrance to Manhattan’s Park Central Hotel bleeding from a gunshot wound. Police followed the trail of blood to a game of poker in one of the rooms. Rothstein refused to say who had shot him, and died shortly afterwards. One of his
proteges, Charles “Lucky” Luciano, stepped into his shoes, and by 1925 was grossing more than £29million per year.
The Italian-born kingpin brought together some of New York’s biggest mobsters to control the city’s bootlegging business and later became known as the father of organised crime after setting up the National Crime Syndicate.
In 1931 he arranged the murder of his ex-boss, Joe Masseria, in order to take over his rackets and switch allegiances.
Masseria, who was also killed during a game of cards, was one of more than 1,000 people to be murdered in mob clashes in New York during the Prohibi. tion. In Chicago, Johnny Torrio and Al Capone had also seen in prohibition their ticket to untold riches, creating their criminal group, the Outfit.
making as much as Capone was soon £117million a year – around £1billion today – and was paying £580,000 a
In its absence we would not have syndicated criminality
HOWARD ABADINSKY ON IMPACT OF PROHIBITION
month in bribes to politicians and police. “I’m just a businessman,” he used to say, “giving the public what they want.”
The crime boss also gained a reputation as a modern day “Robin Hood” after starting a soup kitchen for the poor.
But his reign brought unprecedented levels of bloodshed to Chicago as he tried to eliminate his rivals, the North Side Gang, led by George “Bugs” Moran.
The violence culminated on February 14, 1929, when Capone’s men, dressed up as police officers, shot dead six of Moran’s men. A seventh man, Frank Gusenburg, refused to reveal who had shot them and died a few hours later.
Capone was eventually sentenced to 11 years for tax evasion, and was one of Alcatraz’s earliest inmates. He died of a heart attack in 1947.
Ordinary Americans found ever more creative ways to get around the ban. In Detroit, near to the Canadian border, drinkers used “false floorboards in automobiles, second gas tanks, hidden compartments, even false-bottomed shopping baskets and suitcases, not to mention camouflaged flasks and hot water bottles” to bring alcohol in.
Pharmacists were allowed to dispense whisky for ailments such as anxiety to influenza, and the number of registered pharmacists in New York State tripled. Americans were also allowed to obtain wine for religious purposes. Enrolments rose at churches and synagogues, and there was a sharp increase in the number of self-professed rabbis.
Manufacturers of grape juice began selling kits of concentrated juice, with “warnings” not to leave them for too long or they would ferment into wine.
The trade in unregulated alcohol had serious consequences on health. Many could only find “bathtub gin”, which often contained industrial alcohol. This tainted booze is believed to have killed more than 10,000 people, and left many others blind or with lifelong ailments.
While thousands lost jobs with the closing of breweries, distilleries and saloons, the most damaging effect was on tax revenues. In New York, almost 75% of the state’s revenues had come from liquor taxes.
Prohibition is estimated to have cost the federal government more than £12.9billion in lost tax, while costing over £350million to enforce. By the Great Depression after the 1929 stock market crash, Americans saw the “noble experiment” had spectacularly failed.
As Franklin D Roosevelt put it after he was elected in 1933: “I think we could all do with a beer”. On December 5, 1933, Prohibition was repealed. In New Orleans, the decision was honoured with 20 minutes of cannon fire and the president supposedly downed a dry martini.
But Kansas, Oklahoma and Mississippi remained dry until 1948, 1959 and 1966. To this day, 10 states contain counties where alcohol sales are prohibited.
Most of the gangs moved on to drugs, gambling and prostitution, becoming even more powerful and feared. Many are still in business today.