and selling retail through dispensaries under public management and only for consumption off the premises. Many changes were introduced from time to time without abandoning the principle, but in 1907 the system of state control was replaced by one of county administration. Local veto is also in force, and thus the localities have the choice of a dispensary or no sale at all. The regulations are very strict. The dispensaries are few and only open on week-days and during the day-time; they close at sunset. Liquor is only sold in bottles and in not less quantities than half a pint of spirits and a pint of beer, and it must be taken away; bars are abolished. There is a general consensus of testimony to the effect of the system in improving public order especially among the coloured population, who are very susceptible to drink. The law seems to be well carried out in general, but Charleston and Columbia, the only two considerable towns, are honeycombed with illicit drink-shops, as the writer has proved by personal experience. Columbia is the capital and the seat of cotton manufactures, as are all the larger towns, with the exception of Charleston, which is the port and business centre. The population of the state is predominantly rural, and local prohibition obtains in 18 out of 41 counties.
The following statistical comparison, extracted from the United States Census of 1900 and the Inland Revenue Returns by Mr W. O. Tatum (New Encyclopedia of Social Reform) and here presented in tabular form, is highly instructive. It shows the population and number of liquor dealers paying the United States tax in two prohibition states, one state under what is considered the best licensing system, and South Carolina.
| State. | Population. | Wholesale Liquor Dealers. |
Retail Liquor Dealers. |
| Maine (Prohibition) | 694,466 | 51 | 1366 |
| Kansas (Prohibition) | 1,470,495 | 129 | 3125 |
| Massachusetts (Licence) | 2,805,346 | 617 | 5092 |
| S. Carolina (Dispensary) | 1,340,316 | 13 | 534 |
This table may be said to epitomize the results of the United States restrictive liquor laws. It presents examples of three different systems; the proportion of retail liquor sellers to population is—under complete prohibition, 1 to 508 and 1 to 475; under licence and local prohibition, 1 to 530; under dispensary and local prohibition, 1 to 2509. But the remarkable thing is the enormous amount of illicit traffic existing under all three systems. It is incomparably greatest under complete prohibition because the whole of the traffic in these states is illicit. In South Carolina one of the wholesale dealers and 388 of the 534 retailers were illicit. In Massachusetts the number cannot be stated, but it is very large. If the whole state were under licence the total legal number of licences, which is limited in proportion to population (see above), would be 3400; and in that case there would be some 1700 illicit retailers. But a large part of the state, probably more than half, is under local prohibition, so that the majority of the 5000 retail dealers must be illicit. These facts, which are typical and not exceptional, reveal the failure of the laws to control the traffic; only partial or spasmodic attempts are made to enforce them and to a great extent they are ignored by common consent. The illegal trade is carried on so openly that the United States revenue officers have no difficulty in collecting the federal tax. It is not a satisfactory state of things, or one which countries where law is respected would care to imitate. The example is a good lesson in what to avoid.
Taxation.—Mention has been made above of the federal and state taxation imposed on the liquor trade. The former is uniform; the latter varies greatly, even in those states which have adopted the “high licence.” This system is intended to fulfil two purposes; to act as an automatic check on the number of licences and to produce revenue. It was introduced in Nebraska in 1881, when a tax of 1000 dollars (£200) was placed on saloons (public houses) in large towns, and half that amount in smaller ones. The practice gradually spread and has now been adopted by a large number of states, noticeably the populous and industrial north-eastern and central states. In Massachusetts, where the high licence was adopted in 1874 when the state returned to licensing after a trial of prohibition, the fees are exceptionally high, the minimum for a fully licensed on and off house being 1300 dollars (£260); in Boston the average tax is £310. In New York state it ranges from 150 dollars (£30) in sparsely populated districts to 1200 dollars (£240), and in Pennsylvania it is much the same. In New Jersey, on the other hand, it ranges from £20 to £60; in Connecticut from £50 to £90; in Rhode Island from £40 to £80. In Missouri, which has a special system of its own and a sort of sliding scale, great variations occur and in some cases the tax exceeds £500. In Michigan it is uniform at £100. The mean for the large cities is £133. The revenue derived from this source is distributed in many ways, but is generally divided in varying proportions between the state, the county and the municipality; sometimes a proportion goes to the relief of the poor, to road-making or some other public purpose. The amount levied in the great cities is very large. It will be seen from the foregoing that the taxation of licences is much heavier in the United States than in the United Kingdom. The total yield was ascertained by a special inquiry in 1896 and found to be rather less than 12 millions sterling; in the same year the yield from the same source in the United Kingdom was just under 2 millions. Allowing for difference of population the American rate of taxation was 314 times as great as the British. It has been inferred that the liquor trade is much more highly taxed in the United States and that it would bear largely increased taxation in the United Kingdom; that argument was brought forward in support of Mr Lloyd George’s budget of 1909. But it only takes account of the tax on licences and leaves out of account the tax on liquor which is the great source of revenue in the United Kingdom, as has been shown above. The scales are much lower in the United States, especially on spirits, which are only taxed at the average rate of 5s. 8d. a gallon against 11s. (raised to 14s. 9d. in 1909) in the United Kingdom. Mr Frederic Thompson has calculated out the effect of the two sets of rates and shown that if British rates were applied to the United States the average yield in the three years ending 1908 would be raised from 44 millions to 76 millions; and conversely if American rates were applied to the United Kingdom the average yield would be lowered from 36 millions to 23 millions. Taking licences and liquor taxation together he finds that the application of the British standards for both would still raise the total yield in the United States by 39%; and that even the exceptionally high rates prevailing in Massachusetts would, if applied to the United Kingdom, produce some 4 millions less revenue than the existing taxation. Other calculations based on the consumption and taxation per head lead to the same conclusion that the trade is actually taxed at a considerably higher rate in the United Kingdom. In the three years ending 1908 the average amount paid per head in taxation was 13s. 834d. in the United States and 17s. 634d. in the United Kingdom. It may be added that the method of taxing licences heavily has certain disadvantages; it stimulates that illicit trade which is the most outstanding feature of the traffic in the United States, and combined with the extreme insecurity of tenure involved in local option it gives licence-holders additional inducements to make as much money as possible by any means available, while they have the opportunity, for no compensation is ever paid for sudden dispossession. The notion that the trade will stand an indefinite amount of taxation is a dangerous and oft-proved fallacy.
European Countries.
With the exception of Sweden, Norway and Russia, which have special systems of their own, the continental countries of Europe have as yet paid comparatively little legislative attention to the subject of the liquor traffic, which is recognized by the law but for the most part freely permitted with a minimum of interference. Differences exist, but, generally speaking, establishments may be opened under a very simple procedure, which amounts to an elementary form of licensing, and the permission is only withdrawn for some definite and serious offence. Regulations and conditions are for the most part left to the discretion of the local authority and the police and are not burdensome. The reason for such freedom as compared with the elaborate and stringent codes of the United Kingdom and the United States is not less concern for public welfare but the simple fact that the traffic gives less trouble and causes less harm through the abuse of drink; the habits of the people are different in regard to the character of the drinks consumed, the mode of consumption and the type of establishment. Cafés, restaurants and beer-gardens are much more common, and mere pot-houses less so than in the English-speaking countries. Where trouble arises and engages the attention of the authorities and the legislature, it is almost invariably found to be associated with the consumption of spirits. In several of the wine-producing countries, which are generally marked by the temperate habits of the people, the widespread havoc among the vines caused some years ago by the phylloxera led to an increased consumption of spirits which had a bad effect and aroused considerable anxiety. This was notably the case in France, where an anti-alcohol congress, held in 1903, marked the rise of public and scientific opinion on the subject. Temperance societies have become active, and in some countries there is a movement towards stricter regulations or at least a demand for it; but in others the present law is a relaxation of earlier ones.
