From January 16th 1920 until 23rd March 1933 there was a law banning manufacture, transportation and sale of alcohol  in the United States.   The simplistic view is that the experiment was a failure leading to the rise of glamorous mobsters such as Al Capone, but the reality is that the overwhelming majority of the country's citizens just got on with daily life within the law.

Beginnings

In the 1800's Americaⁱ was a rapidly urbanising country with great disparity in wealth between the top and bottom in society.   The country was made up of many immigrant, religious families with no social security net like we have today.   Mainly church led groups formed societies aimed at helping the poor and needy.   Groups such as the National Temperance Society and the Women's Christian Temperance Union focussed on the perceived ills of alcohol consumption.

They campaigned to get the Sunday trading laws enforced, which were widely flouted rules banning activities such as selling alcohol on the sabbath.   They succeeded and their movement grew.   Full time campaigners were appointed with a salary to tour the States with their message of abstinence.   Stories were circulated about alcohol killing workers and forcing children to work to support their alcoholic fathers.

In 1907 The United States Brewers Association began to combat the publications of the temperance movement, but most brewers didn't see it as a serious thread to their livelihoods.

National tours generated much money for the anti-alcohol movement and their influence helped get Woodrow Wilson elected as President in 1912.   Wilson introduced income tax to the US whereas business taxes were the primary way of generating federal income previously.   This meant that the US Government was not so dependant on big business for its income anymore.

World War One

By 1913 half of the US population were living in dry States.   World War 1 started in 1914 and anti-German sentiment was rife in the US.   Many brewery owners were immigrants from Germanyⁱ or their desendants and prohibition campaigners launched propaganda aimed at associating brewers with the enemy in Europe.

The US entered WW1 in 1917 and alcohol was banned from being sold near of miltary bases and military personnel were banned from consuming it.   As the war progressed, grain and fuel were rationed and beer was restricted to 3.2% by weight to save resources.   WW1 ended in 1918.

The 18th Amendment

In President Wilson's second term of office a combination of the 18th ammendment to the US Constitution and the Volstead Act defined alcoholic drinks as anything over 0.5% and banned them from the US.   Prohibition had begun.

Many breweries went out of business shortly afterwards as the sale of "near beer" - beer below 0.5% alcohol - wasn't enough to support this once huge industry.   Big breweries survived by diversifying into other food products such as yeast, soft drinks and even ice cream.

Organised Crime

The demand for alcohol was still present and organised crime gangs smuggled beer in from the booming Canadian and Mexican breweries or made it themselves.   Most Americans obeyed the law, but the ones that didn't moved to strong liquor over time.   The advantage of strong drink such as whiskey & moonshine was that it is smuggled more easily and gave a bigger hit per dollar.

The gangs fought each other in turf wars and illegal hidden bars opened - speakeasies.

Repeal

Around the same time as the start of the Great Depression, President Herbert Hoover released a report by the National Commision of Law Observance & Enforcement which said that criminal gangs were taking millions of dollars that the treasury should have.   Further, that the general rule of law was being erroded as people didn't adhere to it or respect it.   Poor quality standards also led to many people suffering from all manner of substances being passed off as alcohol.

Previous prohibition supporters read newspaper articles about how a nation of beer drinkers were now a nation of hard drink consumers and lost much enthusiasm for the campaign.   In 1932 the Mayor of New York held a rally called "Beer for Taxation".   Thousands marched through the streets of New York.   Farmers supported the march as many were going bankrupt with the combined effects of the depression and a drought which had lasted several years.

In 1933 President Franklin Roosevelt allowed the alcohol level in near beer to rise to 3.2% by weight, effectively ending prohibition.   Slowly the restrictions on bars, liquor stores and other alcoholic drinks were relaxed, but each State was given freedom to regulate the licensing of alcohol as it saw fit leading to a patchwork of complicated alcohol laws across the States.

Aftermath

The new ranks of organised criminals didn't go away and diversified into other illegal substances.   Some stayed in brewing for a while but the original brewers could make a better product and they drifted away.   The now huge Californian wine industry was set back for years.   A generation of law abiding Americans tasted beer for the first time and American style pale lager became the dominant product on the market as it was consistent, unchallenging and for a market that hadn't come out of the depression yet: cheap.  

Habits changed too; Spirits were a much more favoured drink than before prohibition and alcohol was now generally consumed at home rather than in the controlled environment of the bar, although different packaging styles & cheap refridgeration at home have contributed to this too.