Evidence of decreased consumption is provided by two important American economists, Irving Fisher and Clark Warburton.[3] It should be noted that annual per capita consumption and the percentage of annual per capita income spent on alcohol had been steadily falling before Prohibition and that annual spending on alcohol during Prohibition was greater than it had been before Prohibition.[4]
The decrease in quantity consumed needs at least four qualifications--qualifications that undermine any value that a prohibitionist might claim for reduced consumption. First, the decrease was not very significant. Warburton found that the quantity of alcohol purchased may have fallen 20 percent between the prewar years 1911-14 and 1927-30. Prohibition fell far short of eliminating the consumption of alcohol.[5]
Second, consumption of alcohol actually rose steadily after an initial drop. Annual per capita consumption had been declining since 1910, reached an all-time low during the depression of 1921, and then began to increase in 1922. Consumption would probably have surpassed pre-Prohibition levels even if Prohibition had not been repealed in 1933.[6] Illicit production and distribution continued to expand throughout Prohibition despite ever-increasing resources devoted to enforcement.[7] That pattern of consumption, shown in Figure 1, is to be expected after an entire industry is banned: new entrepreneurs in the underground economy improve techniques and expand output, while consumers begin to realize the folly of the ban.
Third, the resources devoted to enforcement of Prohibition increased along with consumption. Heightened enforcement did not curtail consumption. The annual budget of the Bureau of Prohibition went from $4.4 million to $13.4 milion during the 1920s, while Coast Guard spending on Prohibition averaged over $13 million per year.[8] To those amounts should be added the expenditures of state and local governments.
Figure 1
Per Capita Consumption of Alcoholic Beverages (Gallons of Pure Alcohol) 1910-1929. Source: Clark Warburton, The Economic Results of Prohibition (New York: Columbia University Press, 1932), pp. 23-26, 72.
What metric was used to determine consumption of an illegal substance in 1921? People tend to be less forthcoming about such things if fines and jail are involved.