Prohibition Loophole--Wine Bricks

Wine Brick

Once Prohibition became law on January 16, 1920, many wine producers in California got out of the wine business and converted their vineyards to orchards or sold their land. A constitutional amendment had never been repealed before, so the drastic move seemed like a reasonable way to cut their losses.

But other vintners began to promote and sell grape juice and other non-alcoholic products. Some enterprising vintners began producing non-alcoholic wine bricks. The compressed and concentrated brick was to be rehydrated with one gallon of water to make reconstituted grape juice.

The Volstead Act made it against the law to produce, distribute, or sell alcohol products. But the law had a loophole big enough to drive a truck through. Under Section 29 of Volstead Act, consumption of alcohol was not expressly prohibited. Up to 200 gallons could be produced privately for consumption at home.

To protect themselves from breaking federal Prohibition laws, vintners printed a disclaimer on their packaging. They warned consumers not to place their grape juice in a cool, dark spot for twenty-one days, or add yeast lest it convert to wine. That the products were labeled Claret, Port, Muscatel, Burgundy, and Riesling underscored the intended use of the product.

Wine was culturally the drink of choice for many Italian and French Americans and wine bricks became a legitimate business opportunity for Chicago and Detroit racketeers acting as distributors. They cornered the market. The underworld began buying the bricks by the ton and distributing them nationwide by rail. The pre-Prohibition price was $9.50 per ton; by 1924, the price was $375.

The wine brick trade became big business and was one of the Detroit's Purple Gang controlled rackets. It was a factor that played into the Collingwood Manor Massacre of 1931. Three leaders of the Little Jewish Navy gang were lured to an apartment with the promise that the Purple Gang would give them the wine brick concession for the customary kickbacks. Instead, Izzy Sutker, Joe Leibowitz, and Hymie Paul got paid off in lead for trying to muscle in on Purple Gang territory. 

In 1933, the Volstead Act was repealed and America went wet. The bottom fell out of the bootlegging business and the thirteen-year-long nightmare of gang warfare on America's streets ended. Those winery owners who weathered the storm and supplied organized crime with their raw material became rich, increased their landholdings, and saved America's wine industry.

Prohibition History Crash Course

With the passage of the Eighteenth Amendment to our United States Constitution and the Volstead Act on October 28, 1919, the manufacture, sale, and distribution of intoxicating spirits was made illegal in the United States. The Prohibition Act went into effect in 1920 and pushed the consumption of booze underground, creating the Roaring Twenties and the age of the big city gangster.

Seen as a "Noble Experiment," Protestant, Baptist, and women's Temperance groups believed that Prohibition would improve American life and guide our nation towards prosperity and morality. The evils of alcohol were readily visible with scenes of public drunkenness, violence, and domestic abuse of women and children commonplace events.

Henry Ford was a strong advocate of the Temperance movement hoping to improve the attendance of his workforce--many of whom were drinkers of alcoholic beverages. The Klu Klux Klan was also a supporter of the movement for anti-immigrant reasons. Anti-German sentiment after World War I was unsympathetic with the German tradition of beer drinking. The Irish Catholics had a taste for hard liquor while Italian and French Catholics enjoyed their wine. All were opposed to the alcohol ban on cultural grounds.

A loophole in the Volstead Act did not specifically prohibit the use of intoxicating beverages. Physicians were allowed to prescribe whiskey for medicinal purposes. Patients could buy a prescription from a doctor for $4.00 and then take it to a pharmacy to be filled. Doctors were doing a box-office business. Because of rampant abuses in the first years of Prohibition, a law was passed to allow physicians to write no more than fifty prescriptions per year and patients could obtain no more than one gallon of whiskey per month. 

Homemade wine and apple jack could be produced for personal consumption so farmers and home vintners could preserve their grape and apple crops over the winter months. Sacramental wine for religious purposes was also allowed to placate Catholic and Jewish voters.

Prohibition began the era of smuggling distilled liquor from Canada, Cuba, and the Bahamas. There was also wildcat liquor production in the form of moonshine and bathtub gin. Moonshine production increased in Appalachia in the backwoods and hollows of the Smokey Mountains. Farmers realized that converting their corn crops to alcohol was ten times more profitable than transporting sacks of grain for human or animal consumption.

Typical still setup

To increase production and profits, some moonshiners used old automobile radiators for condensation units and switched from corn mash to pure sugar. Because of unsanitary conditions and contaminated backwoods stills, many drinkers of moonshine went blind from glycol and lead poisoning, prompting the expression "blind drunk." The stronger the "shine," the higher the proof--180 proof meant that the liquor was 90% alcohol and 10% water. Commercial liquor is typically 80 proof with 40% alcohol and 60% water. The strength of moonshine earned it the name White Lightening.

Scene from "The Roaring Twenties" with James Cagney and Frank McHugh.

Enterprising city dwellers also began making a concoction called bathtub gin. Five gallon steel containers of cheap grain alcohol were poured into a tub. Tap water was used as a cutting agent at a ratio of one part alcohol to three parts water to stretch the supply. Then, flavoring agents such as juniper berry juice or fruit juice was added. For color and aging, a few drops of coal tar extract would do nicely as would burnt sugar. Then, the mixture was hand-bottled in used liquor bottles or relabeled with counterfit brand names and sealed with phony Federal liquor commission stamps.

Because of increased demand, the general quality of homemade liquor declined during Prohibition and was harsh to the taste. This created the popularity of the cocktail and the highball to cut the bitterness of the hooch. In those days, cocktails contained three or more ingredients--alcohol, a source of sweetness (honey, sugar, or molasses), and a bitter/citrus flavor to mask the harshness. Highballs were simply liquor and a mixer like 7-Up to flavor and dilute the alcohol.

The following link from the History Channel gives a three minute, animated survey of Prohibition in America. Wait for the ad to run: https://www.history.com/topics/roaring-twenties/prohibition/videos

Canadian Prohibition Loophole Fuels Roaring Twenties in United States

Model T stake truck breaks through Detroit River ice with overload of Canadian liquor

During the United States Prohibition period, the majority of liquor passing through Windsor, Ontario and the Border Cities into the United States came across the Detroit River. The United States Customs Department estimates that 80% of all illegal spirits brought into the country during Prohibition originated in Canada--our neighbor to the North. This "Detroit Funnel" as it became known in the press supplied liquor to Chicago, Lansing, Toledo, Cleveland, St. Louis, Kansas City and all points in between.

When Ontario passed the Ontario Temperance Act in 1916, the province closed the bars, clubs, and liquor stores until the end of World War I. The government needed the grain for the war effort. But with the end of the war, the Canadian government repealed wartime Prohibition and liquor began to flow again in the Dominion.

Meanwhile, the United States Congress passed the 18th Amendment--otherwise known as the Volstead Act--on October 28, 1919. The act banned the manufacture, transport, sale, import, export, and delivery of alcohol spirits within its borders. The bootlegger, rum runner, and flapper were born. The easy market and close access to Detroit became the focal point for shipping illegal booze into the United States from Canada. Historians labeled the age The Roaring Twenties--when organized crime flourished on both sides of the International Border.

Under pressure from vocal Temperence groups on both sides of the International Border, Ottawa passed Bill 26 decreeing that each province could prevent the importation of liquor by holding a referendum vote. The rest of Canada voted dry leaving Ontario to stand alone. The province did vote to approve the Sandy Bill on July 19, 1921 which disallowed the movement of liquor within Ontario without an order of the Board of License Commissioners.

Jim Cooper--Belle River and Walkerville roadhouse owner and illicit liquor dealer--figured out that if he set up an export business in Detroit, he could circumvent the Ontario law. Canadians would place an order through a Detroit telephone number. The purchased goods were not imported into Ontario. The liquor was already in Windsor and Walkerville warehouses. Because the purchase was made out of the country, it was perfectly legal to be delivered within Ontario.  

During Prohibition, six distilleries and twenty-nine brewers operated within Ontario all licensed by the federal government. It is estimated that forty million dollars of booze illegally crossed the border every year. At first, there was a lot of small-time suitcase smuggling for personal use. All manner of devices were contrived to conceal bottles. Some people strapped bottles under their clothing, pints were slid into high boots, and cars were fitted with hidden compartments.

After organized crime wrestled control of the river from small-time operators, much of the liquor was smuggled in by the boat load. In the winter, old jalopies, trucks, and sleds scurried across the frozen river to engage in the illegal trade. When the U.S. Coast Guard built up their fleet with 200 h.p. patrol boats hoping to dominate the river traffic, the Purple Gang's Little Jewish Navy bought specially outfitted speed boats and mounted small cannons on their bows with Tommy Gun-toting crews to harass the authorities leveling the playing field. The Purple Gang laid claim to the Detroit River as their territory. Any freelance bootleggers unlucky enough to be caught smuggling by the gang lost their booty and often their lives. The Purple Gang alone is credited by police with the murder of over 500 people during their bloody reign of the Detroit underworld.

Earning the big money became possible because of a gaping loophole in the Canadian law. Large quantities of liquor could be bought from Canadian distilleries for export purposes if purchasers or their agents carried a Canadian Customs B-13 export clearance document certifying that the buyer was exporting liquor anywhere but a country where Prohibition was the law. Shipments were marked for Europe, Cuba, and South America. But once a boat left the loading dock, the Canadian government was unconcerned where it actually moored and unloaded. The burden of enforcing this American law fell squarely upon the United States, and the Dominion felt no obligation to enforce the laws of their sovereign neighbor.

The boxes and barrels of liquor were distributed to Ontario Border City export docks strung out along the length of the Detroit River. Rum runners from Detroit would cruise across, load up their boats, and make their river runs--mostly at night. In the winter, the shipments were loaded on the frozen Canadian river bank awaiting their mass exodus across the International Border.

Some of the diverted illegal liquor stayed in Canada by sailing directly into slips behind Ontatio's chain of roadhouses stretching from Windsor to Niagara Falls offering dining, drinking, dancing, gambling, and adult entertainment. Americans flocked to Ontario to patronize the Border Cities thriving vice economies.

For its part, the Canadian Government levied a nine dollar tax per gallon on all liquor sales. This export tax was returned when the customs department received a certificated receipt from the country where the shipment was imported. Since most of the liquor landed in America, those receipts were never redeemed. By 1928, Canada earned up to thirty-million dollars per year this way.

With the New York stock market crash on October 29, 1929 and the onset of the Great Depression, many people lost everything. Jobs were scarce and money was tight. The drunken revel was all but over. Then on December 5, 1933, the United States government passed the 21st Amendment repealing Prohibition. The bill landed on President Franklin Delano Roosevelt's desk and he signed it. The boom times of Prohibition ended on both sides of the international border. It would take another World War to turn the economies around for both countries.

The Rise and Fall of the Purple Gang: 
https://fornology.blogspot.com/2018/03/the-rise-and-fall-of-detroits-purple.html

"Kosher Nostra"--Detroit's Purple Gang Origins

Russian immigrants waiting on Ellis Island.

Detroit's slums were the breeding ground for crime and violence when waves of European immigrants settled in the city between 1881 and 1914. The Purple Gang members were second-generation Jewish-Americans of Russian and Polish descent. Their Hastings Street neighborhood was on Detroit's Lower East Side known as Black Bottom. These young men were born into poverty and received little education barring them from desirable jobs. Mob life offered them everything but respectability.

Street punks waiting for some action.

Before they were known as the Purple Gang, they were part of a neighborhood mob of delinquent youths who became thieves, pickpockets, and shakedown artists primarily in the Eastern Market area just north of their home turf. Under the mentorship of older neighborhood gangsters--Charles Leiter and Henry Shorr--the Purples began to commit armed robbery, hijacking, bootlegging, loan sharking, kidnapping, extortion, and murder for hire. Soon, gang members ran gambling rings, speakeasies, and a numbers racket (lottery) among Detroit's black population.

Purple Gang members avoiding a press photograph at the 13th Precinct police station.

The Purple Gang was exceptionally violent and ruled the Detroit underworld from 1927 until 1935. Authorities estimate that the gang murdered over 500 members of rival bootlegging gangs during Detroit's bloody turf wars. They were virtually immune to police interference because of payoffs to city officials and local beat cops. When known Purple Gang associates were arrested, witnesses were terrified to testify against them.

The Purples came about through the merging of two groups--Oakland County's Sugar House Gang led by Leiter and Shorr, and a mob of Jewish street hoods led at that time by nineteen-year-old Sammy Coen, who assumed the alias Sammy Purple. Detroit detective Henry Gavin claimed the gang was named after Sammy. Once the police tagged the group as the Purple Gang, the press took up the drum beat. Gang members hated the label. There are several urban legends about how the gang's name came about, but Henry Gavin's explanation is the most credible.

Canadian liquor being smuggled on the Detroit River.

The gang grew into manhood with the emergence of Prohibition. Three years before the Volstead Act and national Prohibition became the law of the land, Michigan passed the Damon Act in 1917 prohibiting the sale of liquor within the state. Henry Ford supported and financed the movement because he wanted a sober workforce, but the Damon Act was declared unconstitutional in 1919.

By the time the whole country entered Prohibition with the Volstead Act in 1920, Detroit was already a haven for bootleggers and hijackers of Canadian liquor shipments. Detroit was the gateway for the illegal distribution of alcohol to larger cities like New York, Chicago, and St. Louis. By the mid-1920s, Detroit was home to an estimated 25,000 illegal drinking establishments called speakeasies which were full-service bars. For people who couldn't afford cafe society, blind pigs developed which sold liquor by the shot in private homes and after-hour businesses.

Legend has it that a church in Walkerville, Ontario installed a neon cross on their steeple to signal bootleggers that a shipment of booze was coming across. The neon beacon could be seen through the fog which was when the boats would leave. Pint bottles were developed so they would sink in case bootleggers had to ditch them in the Detroit River. Fifth-sized bottles would often wash up along the shoreline.

The four Kaminski brothers grew up in Delray on Thaddeus Street. They would hang out along the river and watch the rumrunners try to outrun the Coast Guard. If a shipment was in danger of being seized, the "Little Jewish Navy"--as they were called--would throw the booze overboard to ditch the evidence. The brothers knew the river currents and would dive in to retrieve as much product as possible--then sell it. Seems like virtually everyone in Detroit was in the liquor business.

Boats were used on the water, and trucks were used on the ice to transport booze.

Seventy-five percent of the liquor smuggled into the United States during Prohibition passed through Detroit. The Purple Gang's liquor, gambling, and drug trade netted the gang hundreds of millions of dollars annually providing the "grease" to make hefty payouts to city officials and police who agreed to look the other way. Turf wars were inevitable, and it wasn't long before Detroit streets ran with the blood of would-be rivals. The Purples became overextended and began to import hoods from New York and St. Louis to work as "muscle" for the gang.

Unlike the Italian-American gangs who pioneered organized crime, the Purples were a loosely structured gang with shifting allegiances that came together and drifted apart when the need arose. After Sammy Purple's leadership, Raymond Bernstein ruled the gang until his murder conviction. Ray's soft-spoken brother Abe became the boss thereafter.

Author Robert A. Rockaway wrote in Shofar: An Interdisciplinary Journal of Jewish Studies (2001), "Italian gangsters tended to involve (cross-generational) family members in their criminal activities. With the Jews, it was that one generation, the children of immigrants, and it ended with them." As a postscript, the Purple Gang reigned over Detroit's underworld for only five years. Most of the gang were either gunned down or died in prison.

My next post will cover the rise and fall of the Purples in Detroit.

*** 

Part Two: https://fornology.blogspot.com/2018/03/the-rise-and-fall-of-detroits-purple.html