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How Did Prohibition Affect The Economy

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Prohibition can sound like a good thing right? Although it may sound almost completely positive, many unplanned negatives came with it. From 1920 to 1933, producing, selling, and transporting alcoholic beverages was banned. (History.com) Through this, it had effects on the economy, American people, and illegal activity. Many of the things that came about it were not expected by the government. They did not anticipate the backlash that it would bring about. As was mentioned briefly, prohibition had an effect of the American economy. This effect however is not looked at as the most positive one. One of the big things that came about it was a decrease in the amount of revenue the government received. In 1914, a total of 226 million dollars was …show more content…

Since it was illegal to get your hands on liquor, people still had to find ways to get it for themselves. Individuals started the illegal production and selling of alcohol. They would also transport it throughout the states. This was called bootlegging. Bootleggers would sell to anyone who had a want for it, and would be willing to pay in order to get it. The sale of liquor was untaxed at this point because it had no tie to the government since it was not allowed to be sold. Bootleggers also had countless underground clubs. At these clubs, they would purchase alcohol and sell it to buyers who wanted it. These people did their best to operate without the authorities knowing. Because of how serious of a secret this line of was, there started to be organized crime. (Thornton) Within the first few months of prohibition, the number of total arrests increased by about twenty-five percent. Some of the criminals would bribe the police just so that they could continue with their activities. This actually led to them being practically above the law. People wanted to become the producers or distributors because they were thought to have a role of power. In order to make an effort to stop all of this, the government spent an unthinkable of money. This meant that there would be an increased budget to stop it. In ten years, the amount of money needed to implement prohibition rose from 6.3 million to 13.4 million. It ended up being a never ending battle to stop it. (Washington State University) Overtime, this was extremely

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