Russ Roberts

Okrent on Prohibition and His Book, Last Call

EconTalk Episode with Daniel Okrent
Hosted by Russ Roberts
Menand on Psychiatry... Blakley on Fashion and Intelle...

Daniel Okent, author of Last Call: The Rise and Fall of Prohibition, talks about the book with EconTalk host Russ Roberts. They discuss how the 18th Amendment banning the manufacture, sale, and transport of intoxicating beverages came to pass in 1920, what life was like while it was in force, and how the Amendment came to be repealed in 1934. Okrent discusses how Prohibition became entangled with the suffrage movement, the establishment of the income tax, and anti-immigration sentiment. They also discuss the political economy of prohibition, enforcement, and repeal--the quintessential example of bootleggers and baptists.

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0:36Intro. [Recording date: June 1, 2010.] Social history of more than just Prohibition: portrait of America between 1870 and the 1930s. Learned how much Americans drank in the late 19th century and early 20th century and how much passion there was against it. How much drinking was there? We were drowning in it. If you go back to the beginning of the Republic, 1630--even before--the boat that brought John Winthrop to the Massachusetts Bay colony had more beer in its holds than water. So, even the Puritans did their share. By 1775, alcohol so firmly part of American life that George Washington decreed that every member of the Continental Army would get a daily ration of 4 ounces of whiskey. Government dependence on whiskey--in 1790s, Alexander Hamilton institutes the excise tax on whiskey which he put there because he knew it was the one thing that was being consumed throughout the young nation. Then, quantity goes up horribly. 1830 the peak--could also say the nadir, the depths--of drinking, the average American drank 7 gallons of alcohol a year. That's the equivalent of 90 fifths of 80-proof liquor, nearly two bottles a week. Per person over 15. Considering that a lot of people don't drink at all, those who were drinking were drinking a lot. The social consequences were horrible. It's not that the drinking became so extreme without there being some good reason for it: the primary reason was the bad quality of water, wanted to be safe with distilled water. But you don't need that much a year to slake your thirst. The advent of the saloon on the frontier and the industrial parts of the cities makes liquor available and enables the drinking man. The saloon was everything from a hiring hall to a men's club to a place where one could get a bed and shower; a place where one could get a prostitute, where one could escape from daily life. Leads to the beginning of an anti-drinking movement--on behalf of women left behind or put upon by their husbands' excessive drinking at a time when women had no legal or property rights to speak of. The book is extremely even-handed in its portrait of the wets and the drys. But coming across right now as very dry. Think Prohibition was a bad idea; but there was a reason for it. Drinking took a terrible toll on the lives of Americans. Couldn't get a sizeable popular movement if the effects weren't so apparent.
5:00Part of that passion against it was religious in nature and not simply a reaction to the social costs of liquor. Baptist and Methodist Churches were anti-liquor, and remain so today, at least the Baptist Church does. In the mid-west and south, the native-born white Protestant of Anglo-Saxon extraction was not just interested in temperance for religious reasons, but also there were ethnic reasons involved. It was a Protestant movement aimed against Catholics coming into the cities. Irish and Italian, some other eastern European countries. In the middle of the country, they thought they were losing the country to these invading immigrant hordes. Sounds familiar. Cities filling up with immigrants. Political machines were largely born out of the saloons. John F. Kennedy's grandfather, Patrick, was a saloon operator and a war leader. The saloon was the perfect place to organize politics around--the Democratic machines that grew up in the late 19th century came out of the saloons. They were electing people to Congress who didn't look like or sound like the typical native-born American from southern Ohio. They saw that they were losing their country, and they blamed liquor. Also saw that beverages were a very large part of the immigrant groups. The Irish and Italians, part of daily life to have beer, wine, or whisky, even if in moderation. Seen as something that promoted the political evil. The work life of an American at the time, not just in the cities but in the countryside, farms or mines, was a pretty tough life; at the end of that day you could use a drink. Upton Sinclair's The Jungle, horrible life in the meat-packing plants of Chicago at the turn of the last century. Sinclair was dedicated dry--very much pro-Prohibition from the beginning. But he has his character singing the hymns of the Saloon. It was an escape. Think what a good writer Sinclair would have been if he drank. Just kidding. Jack London--wrote more than anybody per year and drank heavily. Many writers have a feeling they write best when they are drunk, but a feeling they only have about themselves. Jack London: in 1911 he's living in Sonoma County, CA, and there's woman's suffrage on the ballot. Rides into town, has a few drinks, votes, and rides back and tells his wife he voted for women's suffrage. She was shocked--he'd never shown any interest in women's suffrage--and asked him why. He said he had realized that when a woman gets the vote, she will vote to close the saloon, and if the saloon's closed, "I will finally be able to stop drinking." Wanted to tie himself to the mast. Little did he know that liquor would still be available in San Francisco. He was right on the question of women. The women's suffrage amendment and the Prohibition amendment entered the Constitution virtually together, and the two movements were inextricably linked from 1850 forward.
10:26Single issue of how Prohibition went forward and how it wove in with the suffrage movement. The key figure in bringing about Prohibition was a now totally forgotten man named Wayne B. Wheeler, who, when he died in 1927 The Washington Post said that when a history of our time is written, the first name that will be mentioned is his. Fabulous character. Political strategist and manipulator. Showed how you could win at the margins. Dedicated the Anti-Saloon League (ASL) to only one issue. All he cared about for anyone running for Congress was whether you were for Prohibition or not. He could deliver anywhere from 5-20% of the votes. Without ever having a majority, he could tilt the balance in a close race. Realize he could expanded his influence if he brought other allies into his tent. With women's suffrage, not quite a public quid pro quo--we'll support you if you support us--but everyone realized the two were related. As a result, the brewers, the most powerful forces on the anti-Prohibition side, vowed in the resolution passed in 1871 by the U.S. Brewers' Association, to opposed women's suffrage anywhere and everywhere because they saw the vote for women would be their downfall. The more they opposed women's suffrage, the more it did turn women against them. Footnote: In some dimension the largest anti-Prohibition force were drinkers, but they weren't organized. No mechanism for them other than the ballot. The brewers, because they had money, but because they opposed women's voting they were seen as evil manipulators--seeking profit, which they were. Did underhanded things: supported huge campaign of bogus journalism they gave to editors all over the country: articles that purported to tell the true story of accomplishments made because of the beer they were drinking--all fabricated. Country editors like their money, one of the brewers said. 1903-1905, Texas, state Prohibition measure on the ballot: the brewers decided they were going to take advantage of the pre-Jim Crow law in Texas. Would send their agents out, throughout east Texas primarily, to attract black voters with three things: money to pay the poll tax; a power of attorney that would enable them to vote, dead person's vote; and a picture of Abraham Lincoln, to indicate whose side they were on. Diabolical and very effective. East Texas remarkable place: Caro's biography of Lyndon Johnson--a little lawless there. Role income tax played? Biggest surprise. Not addressed directly in earlier histories on Prohibition. Until the passage of the income tax amendment, 16th Amendment in 1930, the Federal Government in any given year got as much as 40% of its revenue from the excise tax on alcohol. Couldn't have a functioning Federal government unless you had a substitute for that revenue. In 1895 Supreme Court declared a federal income tax unconstitutional, so it had to come about by Constitutional amendment. Prohibitionists hooked up with the populists: William Jennings Bryan was the figure who represented both. He was the embodiment of both these movements. In 1913, when the income tax amendment is finally ratified, only then does Wayne Wheeler declare they are going for a Constitutional Amendment, because only then would there be a substitute for the tax on liquor. Don Boudreaux's work with Adam Pritchard--1930s when the income tax revenue was falling dramatically, it made the repeal of Prohibition more attractive. World determined by economic matters. Greased the skids.
17:28Run-up to the actual passage: nationally not a majority; in the cities, a big minority. How did this actually happen? Had in the mid-west a wild array who talked about the evils of liquor. The anti-alcohol people spread some horrible lies about alcohol. How did it coalesce to actually change the Constitution? First, stipulate: Apportionment of state legislatures in those years, in the decades before Baker v. Carr, was wildly out of skew with the population. For instance, in New York State, the number of the NY State Assembly who came from upstate farm towns represented one seventh the number representing the lower east side of New York City represented. Rotten borough districting: The Protestant districts dominated state legislatures across the country. When the ratification process begins, the rotten borough legislatures make it possible. But the thing that actually puts it over was WWI. To clarify: each House separately had to ratify by two thirds. That came about because of the 1916 election. In the 1916 election was one that Wayne Wheeler and the ASL elected a dry Congress; were able to threaten others with future defeat because they had elected so many. It passes Congress; gets 2/3 majority within each House. Now has to get ¾ of the states: within each state, only need a majority, but need ¾ of the states, so at the time needed 36 state legislatures. Would look hard except for the mal-apportionment of state legislatures, particularly in states that had large urban populations that were terribly underrepresented. Maryland had not reapportioned its state legislature since 1867. Half a century of immigration and Baltimore growing that was not reflected in the makeup of the state legislature. Second factor was WWI. The brewers and WWI were not a happy combination. The last names of the brewers were Anheuser, Busch, Schlitz, Pabst, Schmidt, Coors--all of them were German. Easy for the ASL to demonize the brewers--sapping the strength of the American fighting man by feeding him this poisonous alcohol; sapping the spirit of the people back home because they were in a drunken stupor. The breweries were consuming the grain products needed to bake bread for the starving Belgians. Tools of the Kaiser, fifth column working inside of the United States. That put it over. The brewers had spent the previous four decades doing everything they could to discredit the Prohibition movement, and now they were totally discredited by WWI. Took almost no time, space of 15 months. Finally 46 states ratified the amendment. Only Rhode Island and Connecticut didn't ratify it--the two most Catholic states in the country. What were the politics there? The representation there was honest and fair; and was heavily Catholic. Almost universally opposed Prohibition. In Connecticut it passed one house of the legislature but failed in the other. In RI, neither one. New Jersey, also with a heavily Catholic population, didn't ratify until two years after the legislation was already in effect. The brewers were largely German. The Jews were dominant in the distilling business in this era. Interplay between the distillery industry and the brewers. On the one hand you have the beer manufacturers, who are mainly selling their product through saloons, which are seen as dens of iniquity; then you have the distillers, also selling to the saloons but it's expensive, so often selling to a higher brow crowd in hotels and at home. Their interests for a long time were very disparate. They were economic rivals: every glass of beer you bought was a shot of whisky you didn't and vice versa. Every new saloon sponsored by Pabst or Schmitz that opened on a corner was bad for the distilling industry; every city that put a high price for the license of saloons was bad for the brewing industry. Worked decisively against each other. Brewers took the position that the distillers were selling this poisonous rotten stuff while they, the brewers, were offering what they had the temerity to call "liquid bread." Photograph in book of an advertising brochure from a brewer of German extraction in Detroit showing a 3 or 4 year old child drinking beer as a healthful beverage. The distillers were able to paint the brewers as the vile managers of these saloons, these terrible places that were corrupting and despoiling the cities. Hated each other, never came together; no organized opposition to Prohibition. The people who drank were too busy drinking. Harder to fight to keep something than to change something. Politically it's easier to play offense than defense.
26:30There was an ideological opposition--the government has no business in telling me what to put in my glass. Really the beginning of the nanny state, ironically led by--the left? the right? The categories we have today just don't fit. The people who opposed the nanny state or Prohibition and interference in the lives of individuals most vociferously were the eastern plutocrats, the wealthy extremely conservative Republicans who had dominated Congress from the 1890s until 1920--same people who opposed women's suffrage, income tax amendment, child labor laws, Prohibition. The other constituency was the white racists in political power in the South, because to acknowledge that the government had the power to do this was to acknowledge that the 15th Amendment had validity. They wanted to continue to hold onto the argument of states' rights; can't hold on to that if you are going to have a federal proscription on liquor. The political alliance for Prohibition stretched from the Klu Klux Klan at one end because of the anti-immigrant, anti-Catholic aspect of it, through the Progressive Party, where 17 of the 18 members of the Progressive Party who voted on the Constitutional Amendment voted for Prohibition, to the far left--the Industrial Workers of the World--the Wobblies. They believed that liquor was a tool used by capitalists to keep the working man down. Book brought into highlight some of the class paternalism seen elsewhere; Levy/Peart articles, history of anti-slavery movement, economists' role via Adam Smith; opposition expressed by writers like Dickens, Tennyson, and others who felt that African black-skinned people couldn't make their own decisions. Some of the same forces played out over liquor: the upper class man could hold his liquor but the working man had to be protected. Protected or kept down, depending on perspective. The conservative upper classes saw it as kept down. The more liberal--depends on usage of the term--like Jane Addams: it was for their own good, extremely paternalistic. Page on the Raines Law in book. Wealthy people in the 1890s did their social drinking in hotel restaurants, largely. In an effort to stop the proliferation of saloons, keep them from despoiling the (Sunday) sabbath, NY State passed the Raines Law in the 1890s, that said that on Sundays you couldn't serve liquor in a place that a). served food, and b). was a hotel. Enabled the wealthy to still go out to Astoria and have their fine dinner and wine and whiskey and brandy with it. The way this was dealt with, with ingenuity, was: they had to serve food. What constitutes serving food? Not well-defined. Could be a Saltine. Joke version, called a "Raines sandwich," was bread with a brick in between. It would sit on the counter, you could buy it for a penny, and then have your drink. More nefarious consequence of the Raines Law is that saloons that wanted to stay open on Sunday put in a few beds. What were those beds used for? Prostitution. Saloons became places where not only illegal drinking was going on, but illegal sexual activity as well. Before the law was passed, in Brooklyn there were 10 hotels; after, suddenly there were 2000. Tourist mecca; suddenly people just wanted to come to Brooklyn. Two beds upstairs, or maybe one bed upstairs, and brick sandwich on the bar. As economists, we say that there is no such thing as a free lunch: the free lunch was an absolute staple of the urban saloon from 1890 or so till Prohibition. The saloons were almost all by then dominated by the "tied house business"--Pabst saloon or Rupert saloon or Schmitz saloon; and in exchange for that saloon selling only one brand of beer, the beer would provide everything the owner would need to stay in business, from the cutlery to the sign on the wall, the mirror behind the bar; and also a free lunch. Pay a nickel for your beer, get with it a lunch that consisted of saltines, sardines, clams, sausage--the saltiest fish imaginable. "The sardines were not just fish--they were silent partners." Russ: First moved to St. Louis in 1990s, went with wife to bar and asked what beer they had available. Bartender said, "We have everything: Bud, Bud Light, Busch, Busch Light, Michelob..." They had the entire array of Anheuser-Busch products. St. Louis then somewhat of a tied town. Okrent: Someone once used the phrase "St. Louis is a small encampment on the banks of the Mississippi River just outside the city of Anheuser-Busch." Less true now than then, but still important part of the city and its baseball team.
34:18Volstead Act. The 18th Amendment passes; passed through the Congress, and ultimately 36 of the 48 state legislatures pass it. We've got to provide actual legislation for enforcing it, and that's the Volstead Act. What were the consequences? Named after Andrew Volstead of Minnesota, not a particularly hardened Prohibitionist--kind of classic mid-western social progressive. Volstead Act was pages long. Not written by Wayne B. Wheeler but he had some influence over it. A lot to do with the politics of the day and how it would be enforced. It was never against the law to drink; never against the law to drink in public. What Wheeler had reasoned was that if we make it illegal to drink we will never get anybody to testify against his supplier--whether that supplier is a bartender or a bootlegger in a speakeasy. Three statutory exceptions: to manufacture, sell, and transport, the three things forbidden otherwise by the 18th Amendment. First of these, per Wheeler, was to enable the farmer to preserve his fruit juices. Euphemism for enabling the farmer to make and drink hard cider. Johnny Appleseed was traveling the Ohio Valley in the end of the 18th and beginning of the 19th century. Those weren't Macintosh apples; they were cider apples he was spreading around. As Daniel Webster wrote in his memoire: You could not go into a house in New Hampshire in the 1840s, 1830s, 1820s where there wasn't a barrel of cider by the door and a ladle for everybody to use to take a glass. Wheeler specifically made it clear he was going to keep the preservation of fruit juices legal. In California, people tore out the grapes and replaced them apricots and other fruit crops; but then in 1920, suddenly the price of grapes has gone up eight-fold. By 1923, up something like eighty-fold because suddenly the grape growers realize they can ship huge quantities of grapes east, where there are large immigrant populations, where people knew how to make wine, and where under the Volstead Act it was legal for a family to make up to 200 gallons a year for their own use. That's quite a large family; quite a lot of drinking. The CA vineyardists, who were suicidal at the beginning of Prohibition, suddenly found themselves rolling in money. They could bring in as much money as they had before without having to make the wine; put in 70,000 freight cars going east. Pennsylvania Railroad doubled the size of the New Jersey freight yards strictly to handle the grape harvest coming in to the NY market. Russ: Found this part of the book a little hard to believe. Have to have a lot of faith in how thirsty people are. Grapes they are shipping must be lousy grapes--have to be able to withstand this cross-country journey. Okrent: People from Napa tore out their Cabernet, Chardonnay grapes and planted grape called Alicante Bouche. Two great qualities: shipped extremely well, very thick skin; also very red pulp. Could get something that looked like wine from second, third, fourth pressings. Great business. Very few people left who knew how to make great wine. Leads to second: sacremental wine. Leader in this business, Georges de Latour, founder of Beaulieux Vinyard, still famous today. Had ecclesiastical approbation from the Archbishop of California to sell across the country. Wheeler had put into the Volstead Act the use of sacrificial wine because the Catholics and the Jews were the two groups who had opposed the Prohibition Amendment most vociferously; used this to win their support. It didn't win their support, but it did create an enormous business. De Latour, by 1921, was sending out to grocerers across the country advertising his communion wine, which he had by then, only one year into Prohibition, could get in ten different varietals: Cabernet, Tokay, Mosel, Riesling. Wasn't there brandy also? That comes later--1929, important court decision where the Federal Judge says it's not the liquid itself, but the use that makes it for sacremental purposes--which made legal brandy and Creme de Menthe. The Jews also took advantage of this. The Jews had no hierarchical structure, not a matter of getting approval from an archbishop. Any rabbi could get a license to distribute to adult members of his congregation 10 gallons per year--for the making of kiddush, making of wine for the sabbath. Jews not known for being heavy drinkers. Mythology? Real opposition amongst Jews to Prohibition; seen as Protestant craziness. Any Rabbi could welcome as many people to his congregation as he wished; Talmed Torah in the Boyle Heights section of Los Angeles had 80 families in 1920, and a year later had 1000 families. Rabbi or claiming to be a rabbi, Benjamin Gardner, who within a year disseminated wine to other congregations. Alameda California, names of people who were dead. Lower west side of Manhattan, book, pic, packed high with huge jugs. Became too much of an embarrassment. The number of rabbis being arrested for the wine business was embarrassing and came to a head. When the rabbis name people with names like McLaughlin, O'Hara, Kelley; who was to say who was a rabbi? Some clamping down around 1926; 5 gallons a year and some clamping down.
43:51Irony: home alcohol brewing--could make a substantial amount of your own wine; yet at the same time, virtually no money is set aside for enforcement. The de facto illegal exemptions are enormous. Two thousand Federal Prohibition agents to cover the entire country. Joke. We're in the 1920s. The same mid-Western dominances, and the Presidency in the case of Harding, same people also appropriating government expenditures. Idea of voting dollars to enforce Prohibition was an anathema. Had law but no enforcement to speak of. We talk a lot on this program about bootleggers and baptists--Bruce Yandle podcast, extraordinarily apt to today's conversation. Usually two interest groups in favor of legislation. One of the high-minded folks, moral authority,--saying I'm a Baptist--against it because it's ruining our families; then the bootleggers, who profit from Sunday liquor sales. The bootleggers want to sell liquor illegally under the table. Once Prohibition gets passed, enormous amounts of money get made by bootleggers; clear they have a stake in keeping Prohibition in place. Tax free. Did any of that come into play in advance of the law? Did any of these groups lobby in advance? Not that I found. Found that the groups that were supporting Prohibition out of their own self-interest were the soft-drink bottlers, Asa Candler huge backer of Prohibition. Barry Wisely. Shubert Brothers, legitimate theater brothers; reasoned if the bars were closed, people would go to theaters instead. Don't know if true. Hard to make connection. Many instances of wet politicians--Mayor Bill Thompson of Chicago, wet as the Atlantic Ocean--nothing better than harsh laws that weren't enforced. Hundreds of millions of dollars passing illegally during Prohibition. Did they cut any salaries during this time? Would be wise to cut police salaries. There was certainly no pressure to raise them. Big scandal where a lot of this came out was in Philadelphia. One police captain with income of $18,000 a year, had a bank account of $150,000; said he had been able to acquire that by raising pet birds and selling them. Did very close analysis of vote in Massachusetts to repeal the state's prohibition enforcement law. Voted to be repealed overwhelmingly. The only people who voted to keep it in place were in the coastal counties. Fishing industry, rum running industry. White Anglo-Saxon Protestant versus inland. Tradeoffs and consequences: legal branded products no longer available. Quality degradation. People making those 200 gallons in their own homes, economies of scale having to be done surreptitiously; people dying, poisons put into the liquor; but some quality still in the market. That's where we get call brands today. Watching Gunsmoke, Marshall Dillon never walks to the bar and asks for a Wild Turkey. He asks for a whisky. The saloon didn't know brands. It had a large tap, dispensed its contents. Comfort in saying not "Give me a scotch" but "Give me a Dewar's." Harder to keep that quality; huge business in counterfeiting; creation of first national syndicate. Prostitution, gambling. Once Prohibition comes, need confederates to move, liquor through Boston, to Albany, Hartford. Mob got together, 1929, hotel presidents in Atlantic City, huge corporate pact, fixed prices, crime syndicate. Enforced with violence; how well able to enforce? Wars in locality? Capone. War between south side and the north side. Lucky Luciano, no matter to them.
54:39Repeal, politics. Bootlegger and Baptist theory, which if you are not careful you can think it just says politics makes strange bedfellows. But inevitable coalitions: the devil's in the details. How little money was enforced; exemptions allowed certain groups to make their own wine; drug store phenomenon, issues people were not thinking about when attending meetings by Billy Sunday, thinking liquor is evil and if we can just get this amendment it will be over. Disconnect enormous. All these people who marched--those who Wayne Wheeler martialed--did they just say it would play out over time? Many people very upset by the unwillingness of the government to enforce. Others: the symbolic nature of the law important, tolerated the slippage because they wanted to keep that law in place. Liguor or control of the country? Daniel Klein podcast: people have a certain romance about collective action; makes them feel good. Once they have the law in place, they are the ones playing defense. Legislation soon to be enacted in financial industry: people are already thinking about how do we legally get around this? In the 1920s, Volstead Act in effect. Legal ban on sale and transport. What changes? The economy. The market crashes in 1929. Depression sets in. Income tax is plummeting. Barely enough to fund the government. Where can there be some tax revenue? Aha! Remember liquor? Served us well before. Movement to bring it back; also Duponts of Delaware financed much of the repeal movement. Widely recognized, spoken on floor of Congress: We need some money to run the government. How can we create jobs? Prohibition in the six figures, brewery and ice makers, whole business in 1920s; a lot moved to Canada; others moved to ice cream; bring it back. Best illustration of how much Prohibition was despised: when the 36th state to ratify, Utah, wanted repeal, you know how much Utah wanted it back.
1:02:16Literal sense: reapportionment issue. Bizarre thing in the 1920s, Census: Based on the dicennial census, the House of Representatives will be reallocated to the States based on population. The 1920 Census was the first census to show there were more people living in the cities than in the countryside; also first to reflect the fullest of the immigration that had been going on for the last 40 years. Result was that the drys decided simply to not to reapportion; ignored requirement that they reapportion. Reapportionment measures introduced; decided to ignore the Constitution. Election of 1930; possibility of repeal. 1929; Took 9 years. Arthur Vandenberg: this Constitution is illegal. Detroit; Missouri. If we'd gone back to previous decades, always got it done within a decade. Not written up in books. Court packing. Why did you write this book? Baseball. Last book, history of Rockefeller Center, history of NY in the 1920s and 1930s. Speakeasy belt in NY City. Speakeasy owners had more political clout than the Rockefellers. Two clauses in the Constitution that limit personal freedom: 18th Amendment, Couldn't get liquor and 13th Amendment, couldn't own slaves.

Comments and Sharing

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COMMENTS (22 to date)
BZ writes:

I loved this podcast, and couldn't resist repeating the stories about the Manhattan brothels, the 6 kinds of sacramental wine, and mob boss organizational meetings to coworkers.

Lesson of the day: no power in state houses or on capital hill can repeal human nature.

Justin P writes:

I loved this podcast. I'm glad to see Russ moving on from the Recession-casts, even though I could keep listening/learning from them.

One thing that struck me, of course one of the reasons for these kind of podcasts, was how relevant this is today. Prohibition was a colossal failure. Thank you Prohibition, for giving us the likes of Al Capone and dirty Chicago politics.

If we are to learn anything from prohibition, it's that the nanny state doesn't work. People will do what they want to do, if it isn't "legal" there will always be underground market. People will find ways around it, usually with the help of some unscrupulous people as well.

I think we all need to take a look back at prohibition, when we talk about drug laws in the US. It's obvious that the "War on Drugs" is also a colossal failure as well. Maybe it's time to legalize?

Thanks for the podcast, I just bought the book for my Nook.

Christian writes:

Very interesting! Just bought the book. It blows my mind to think that one day I could walk out of the house and all lounges, nightclubs and bars could be closed down. All I've known my whole life is legal alcohol!

Al Capone writes:

Dear Wayne Wheeler,

Thanks for the good times.



John Berg writes:

Just heard Glenn Beck praise highly Hayek book, _Road to Serfdom_ and spend a hour praising the book. Guess I'll buy it.

John Berg

Dustin Klang writes:

Mr. Berg, I've heard that there is no such thing as bad press, but sometimes one has cause to wonder...

The aforementioned demagogic entertainer exalting F.A. Hayek is somewhat analogous to Alex Jones praising limited government before engaging in some belligerent and conspiratorial Illuminati rant: An open-minded individual might very well feel justified in dismissing the recommendation entirely.

John Berg writes:


To be clear, I will still buy the book using Russ Robert's comments as well as Beck's. I'm not going to wait for a recommendation from President Obama. I will point out that your message contained nothing objective, concrete, or specific that might have influenced my future actions.

John Berg

Dustin Klang writes:

Mr. Berg, my intention was not to influence or slight you; if you took umbrage, I apologize.

If you would prefer an influence, however, I might suggest looking at the following web-sight detailing Mr. Obama's suggested reading list including, among others, Thomas Jefferson, Mark Twain, and Adam Smith (three authors whose virtues I can be reasonably assured we both might extol).

Your sentiment with respect to Mr. Obama's literary recommendations, however, might just have substantiated my adumbrative, abstract and ambiguous point.

John Berg writes:

Again, to make myself clear, I infer from President Obama's actions as President that he is unlikely to recommend _Road to Serfdom_. On the other hand, I have read Saul Alinsky's _Rules for Radicals_ which I understand President Obama used as the text in a course he taught. I did not take personal slight nor do I feel any need to defend Beck though I find informative his entertaining presentations about the effects of Progressive thought.

John Berg

Joe writes:

This was a very interesting podcast. I am putting it on my reading list. I am surprise that given Prof. Roberts love of baseball, there was not some time devoted to the fact that Mr. Okrent is considered to be the inventor of the modern rotisserie baseball scoring system.

Ralph Buchanan writes:

Fantastic! I'll be buying the book. This is an amazing cocktail of economics, history, politics, religion etc.
Russ, thank you for providing an invaluable service to us in the general public who have no time for formal classes. It won't be long (if it's not already happening) before authors and publishers will be knocking on your door for PR and reviews. Please be picky: more gems like this one!

Concerning the above postings: Please don't bicker on econtalk - you can do that on facebook! Is there an econtalk fanpage?
The political angle is relevant here though, given this quote from Alinsky's Playboy interview from 1972:

"...Frank Nitti, known as the Enforcer, Capone's number-two man, and actually in de facto control of the mob because of Al's income-tax rap. Nitti took me under his wing. I called him the Professor and I became his student. Nitti's boys took me everywhere, showed me all the mob's operations, from gin mills and whorehouses and bookie joints to the legitimate businesses they were beginning to take over. Within a few months, I got to know the workings of the Capone mob inside out. ...And let me tell you something, I learned a hell of a lot about the uses and abuses of power from the mob, lessons that stood me in good stead later on, when I was organizing."

Capone's influence is alive and well in modern politics.

John Berg writes:

Okrent notes only "two clauses" in the Constitution that regulates individual freedom: (at 1:01:02) Two clauses in the Constitution that limit personal freedom: 18th Amendment, Couldn't get liquor and 13th Amendment, couldn't own slaves.
We all understand that the US Constitution was written and accepted by sovereign states as limiting the Federal government to "enumerated" powers. We certainly know that these more contemporary AMENDMENTS were not included in the Constitution by the Founders. It still remains shocking to have it pointed out that these two DO limit individual actions.
However, at this time the Commerce Clause has been stretched to permit Minimum Wage laws and, after the Supreme Court closes down Obamacare, perhaps they will address the Constitutionality of other current laws.

John Berg

John Berg writes:

In the same part of summary, Okrent points out that Congress delayed the Congressional reapportionment after the 1920 Census by 9 years. I did not know this and will research it. At the present time a US Citizen has reason to fear that the 2010 Census will count illegal immigrants which will skew the Census results and may result in NE states losing Congressional seats to SW states.

John Berg

Carl Jones writes:

That was very interesting. I'll try to get people to listen to it because it is very relevant to what is happening today. Despite our terrible experience with prohibition, we have an identical situation happening today with marijuana, which funds horrifically violent gangs in Mexico and the United States.

High tobacco taxes are have also created a (much smaller) black market for cigarettes. Some terrorist organizations have made millions by smuggling cigarettes to high tax states and selling them at the tax inflated price.

Left Flank writes:

Thank you for this podcast - and this particular episode. Recent episodes like this and the one about sports journalism are a welcome change of pace. But, please don't stop the hard-core economics talks! I'd like economics history talks like this one to be a regular feature, though.

I do have one question: what is the alternative? Was Okrent arguing that cleaning up the water supply would have been a sufficient means to tackle the country's drinking problem? (I'm reminded of Benjamin Franklin's account of how he saved money and became a foreman when he worked in Britain as a young man, just by avoiding beer). The discussion was enlightening, or actually depressing. But, first, is progressive regulation ever useful? Secondly, is there a type of political action that is fair without stepping on the markets to the point where it becomes counter-productive? It's one thing to say that Prohibition was a huge error, and that Americans should be wary of such thinking when confronted with other issues. But, how can one decide between a bad course of action and a good one. when people will foment for a solution to a problem like drinking?

John Berg writes:

Following up on my June 8, 2010 remark about _Road to Serfdom_, it is now number one on Amazon's bestseller list.

John Berg

Scott Packard writes:

Unusually timely, as the Jones Act, aka the Merchant Marine Act of 1920 is the one that finally brought prohibition into force also has been mentioned yesterday as prohibiting foreign-owned boats from helping the oil spill in the Gulf now.

...requires that all goods transported by water between U.S. ports [cabotage] be carried in U.S.-flag ships, constructed in the United States, owned by U.S. citizens, and crewed by U.S. citizens and U.S. permanent residents.

An article appeared in De Staandard (Dutch newspaper) here:

Google's Translate does a good job.
BRUSSELS - Belgian and Dutch dredgers have technology in-house to the oil spill in the Gulf of Mexico to fight. Maar de 'Jones Act' verbiedt hen om in de VS te werken. But the "Jones Act" forbids them to work in the U.S..

"The U.S. authorities," said spokesman Hubert Fiers of the Belgian dredging group DEME and environment, "estimating that they need nine months to get the job done. Wij kunnen dat in vier maanden. We can do that in four months. En als we samenwerken, kan er misschien nog een maand af'. And if we work together, there may be perhaps one month off. "

John Berg writes:

After some research I must correct my earlier comment: The 1920 redistricting was NOT completed in 1929 but rather new reapportionment legislation was BEGUN in 1929 which was intended to provide a legal basis for future. In fact, no redistricting was completed for the 1920 census. Reapportionment is the assignment of Congressional seats to each State as a result of the Census. Redistricting is the assignment of a boundry to each Congressional district. I expressed concern that the 2010 Census is counting "heads" not citizens. Thus counting 12 to 30 million illegal residents could result in reapportionment of 11 Congressional seats from the Northeast to the West, Southwest and Southeast.
Some controversy exists over who is a citizen. The Fourteenth Amendment does not use the phrase "natural born citizen". It does provide that "All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are Citizens of the United States and of the State wherein they reside." Some clues to their intent can be inferred . Obviously they did not include the world population since they provided for naturalization to make citizens and excluded the residents of the future District of Columbia. Another glaring and unsustainable misinterpretation of the Constitution which requires clarification would be to deem a citizen as only a person born in the US from parents of legal residents.

Frank Howland writes:

Russ's remarks about Dickens in the podcast make it sound like Charles Dickens was pro-slavery. In the podcast, Russ says that the proslavery crowd included Dickens and Tennyson; and after saying "Dickens, Tennyson, and others who felt that African black-skinned people couldn't make their own decisions," which is what the summary above says, Russ adds "and [in the view of Tennyson and Dickens and others] slavery was a way to keep their lives in check."

This is I think wrong when it comes to Dickens and is not supported by the evidence on the econlib site in the Levy and Peart articles on the Dismal Science.

Dickens was very much anti-slavery in 1842, when he visited the United States. His views on race apparently changed as he came under the influence of Carlyle but even Levy and Peart say: "Dickens, for instance, was by no means proslavery (whereas Carlyle was proslavery), but instead opposed the antislavery movement." []

I wonder if Russ has any evidence to support his assertions that Dickens was in favor of slavery.

Like Russ, Levy and Peart seem to ignore the early Dickens, but they don't go as far as Russ does in the podcast.

In fact, in their article Peart and Levy have to stretch quite a bit to differentiate Dickens's allegedly anti-anti slavery and allegedly paternalist views from the anti-slavery views of others. Levy and Peart are, I think, too eager to make a connection between anti-market and pro-hierarchy, pro paternalist views. (Dickens may well have been anti market but his views on hierarchy and paternalism are hard to pin down.) It is not at all clear from the passages that Levy and Peart quote in the above article that Dickens believes there is any permanent difference between blacks and whites, and the control he seems to want to exert over their lives consists of educating them so that they can live as free men. One can agree that Dickens's proposed policies are inferior to complete and instant abolition without condemning him as opposed to human freedom. Calling them racist is a stretch. They may be more fairly be categorized as paternalistic, but it's a paternalism whose aim is to make negroes free men who could make their own decisions.

Russ Roberts writes:

Frank Howland,

Fair enough--Dickens was merely anti-anti-slavery. Still not exactly a badge of honor. The main point was his (and others) view about the ability of other races to make decisions in their own best interest. But thank you for making the right distinction about where Dickens stood with more precision.

Frank Howland writes:

I agree Dickens comes off poorly. However, I am still not sure where Dickens belongs in the spectrums (spectra?) of opinion regarding racism and paternalism. There are many shades of opinion and currents of ideas regarding human nature and Dickens's views are complicated. My main point is that Dickens does not belong on the pro-slavery part of the slavery spectrum and I thank Russ Roberts for acknowledging that. (On Tennyson, I have no knowledge.)

worik writes:


But avoided the elephant in the room: current drug laws.

That would have been interesting.


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