The 18th Amendment authorized Congress to ban the importation, transport or sale of alcoholic beverages. This action, along with enforcing legislation, the National Prohibition Act of 1919 (also called the Volstead Act) put all legal liquor manufacturers and retailers out of work. However, the demand for alcohol did not disappear along with the supply. There remained a very strong consumer demand for alcoholic beverages.
Up until this time, most organized crime was limited to various ethnic communities. The Italian Mafia was one of the largest and best organized, but there were also similar groups in the Irish community, Jewish community, and others. Most organized crime was focused on controlling thefts (for example pilfering from the docks or other large businesses). They also ran the "protection racket" where business owners would pay local thugs a tax each week to make sure they did not get attacked by criminals. If they did not pay, it was usually the thugs themselves that did the attacking. Organized crime also provided access to illegal gambling and prostitution.
When Prohibition began, some of these local Mafia leaders were in a good position to meet the public's demand for illegal liquor. They were well known in the communities, had money and access to off shore sources, and were used to working outside the law, controlling police and politicians through bribes, etc.
The difference that prohibition made was that public demand was so much greater than earlier rackets that it infused a much larger amount of money into these criminal organizations. Mafia leaders, most notably Al Capone began to control enormous empires, developing production, transportation
, and retail institutions to get their product to market. There was plenty of money for police protection and bribes for politicians. Probably most importantly, most of the public was not terribly upset by their activities. Most of the public seemed to view alcohol as a victimless crime where people were just getting a product they wanted, one that had been perfectly legal until a few years ago.
As a result, there was not a strong sentiment to put these criminals out of business. The mafia grew much wealthier, stronger, and more established. They grew so big that many eventually began to see them as a real threat to democracy. They were beginning to exert significant control over elected leaders and the law enforcement process. But it was not until the 18th Amendment was repealed and Prohibition ended that the country really began to regain control over these organizations.
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