strategy+business is published by PwC Strategy& Inc.
 
or, sign in with:
strategy and business
Published: November 23, 2010
 / Winter 2010 / Issue 61

 
 

Best Business Books 2010: Biography and History

Observing such goings-on with horror from across the Pond, Winston Churchill called Prohibition “an affront to the whole history of mankind” that was “at once comic and pathetic.” Okrent documents both of those elements evenhandedly but with the wry — I inadvertently typed rye! — touch of humor the subject calls for. What can one say with a straight face about the Christian Socialist Frances Willard, head of the Women’s Christian Temperance Union (WCTU), whose agenda included government ownership of industry (and theaters!), vegetarianism, cremation, and “alcohol-free, tobacco-free, lust-free marriages”? She must have been a barrel of laughs, but all we can do today is shake our heads at the risible, misguided surety and sincerity of her many pet causes.

But we can learn from the examples of the powerful WCTU and ASL movements just why and how today’s NRA, Tea Party, PETA, and other radical special-interest groups thrive in the United States and exert influence far beyond what their numbers seem to merit. Okrent documents how the ASL, although able to deliver only a small percentage of votes at the polls, consistently leveraged its position by tipping close elections in favor of candidates who toed its line.

Ultimately, however, the Prohibitionists’ successes depended on the predictable cravenness of Democratic Party and corporate leaders who were willing to go along with the movement rather than risk having their own ox gored by its mad bulls. America’s business leaders went into hiding when the Prohibitionists sought to destroy the nation’s fifth-largest industry, and such leading Democrats as then New York governor Franklin Roosevelt (a nonreligious, two-martini man himself) embraced Bible-thumping teetotalers as if they were soul mates. Much as is the case today, educated business leaders and sophisticated members of the nation’s ruling class entered, willy-nilly, into political alliance with undereducated populists and religious fundamentalists who had interests antithetical to their own.

Finally, in the late 1920s, two business heroes stepped forward to do battle with the forces of darkness. Pierre DuPont and John J. Raskob worked with the Association Against the Prohibition Amendment (AAPS) to take on the ASL. Students of business history will recall that they were the same powerful duo who led both the giant DuPont company and General Motors (the latter along with Alfred Sloan) during the 1920s. DuPont and Raskob recruited other top corporate leaders to the AAPS and worked side by side with society matron Pauline Morton Sabin (a Morton salt heiress) to outspend and outflank Wheeler and the ASL — even going so far as supporting Democratic presidential candidate Franklin Roosevelt (who eventually found the courage to lead the fight for repeal). And FDR’s election in 1932 was the end of the game: Prohibition died quickly and with nary a whimper the following year.

The end of Prohibition didn’t finish the AAPS. It turned out that the organization really hadn’t been all that concerned about gaining legal access to alcohol. (The rich never had supply troubles during Prohibition: In 1928, the bibulous Raskob ran up one liquor tab of US$1,651 — more than $21,000 today, adjusted for inflation). Instead, the most important item on the business leaders’ agenda actually was repeal of the 16th Amendment, which established the income tax. DuPont and Raskob reasoned that if the main argument for introducing income tax had been to generate revenue lost as the result of Prohibition, then there would be no need to continue to tax income once the feds got back into the business of collecting on bottles. It was a clever argument, but when their candidate became president, and FDR began to spend all the revenue from both income and liquor taxes on New Deal programs, the infuriated business leaders began to oppose him more vigorously than they had opposed the Anti-Saloon League. Roosevelt then became “that Socialist in the White House.” Sound familiar?

 
 
 
Follow Us 
Facebook Twitter LinkedIn Google Plus YouTube RSS strategy+business Digital and Mobile products App Store