Monday, July 12, 2010

Last Call

Cowen on Last Call:

Okrent can't claim to have discovered Prohibition; Michael Lerner's recent Dry Manhattan is another good entry in a well-tilled field. What elevates Last Call is, among other things, a clear explanation of the unique confluence of events that caused it. The introduction of the income tax made Prohibition fiscally feasible. Women's suffrage made it politically feasible. World War I created a surfeit of patriotism, a willingness to sacrifice, and an embrace of the expansion of federal power. By 1920 everything was in place for a bold new government intrusion into everyday life.

Tabarrok:

Here is Okrent on Prohibition and the income tax:

By 1875 fully one-third of federal revenues came from the beer keg and the whiskey bottle, a proportion that would increase in the years ahead and that would come to be described by a temperance leader in 1913, not inaccurately, as "a bribe on the public conscience."

...it would be hard enough to fund the cost of government without the tariff and impossible without a liquor tax. Given that you wouldn't collect much revenue from a liquor tax in a nation where there was no liquor, this might have seemed like an insurmountable problem for the Prohibition movement. Unless, that is, you could weld the drive for Prohibition to the campaign for another reform, the creation of a tax on incomes.

1 comment:

marry said...

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