How prominent was the Black Market in the US during WWII surrounding Ration Cards and Ration Points?

by cheftlp1221

Additionally how aggressively did law enforcement investigate and prosecute? What were the penalties?

cheftlp1221

The narrative that survives is that the country pulled together in a collective act of patriotism and everyone followed the rules. Were cracks downs on Black Markets purposefully under reported to avoid creating copycats? How did people cheat the system?

Zither13

Just for background for others who wander in here, universal gas rationing started on Tuesday, December 1, 1942, after partial rationing had been in effect that had not affected the West and Midwest.

Kind of depends on how you define "prominent." I'd say it was something many people had to consider daily, to buy legit or go black market, especially the longer the war went on.

Boardman has one reference, p.293, that the OPA estimated black market purchases in 1943 alone at over a billion dollars. OPA head, Bowles, estimated "its damage in billions of dollars."

Casdorph quotes Geoffrey Perrett that "somewhere between 25 and 50 percent of all American business was estimated to be in the black market, and the higher figure is probably more accurate than the lower; in 1944 OPA investigations of several thousand businesses revealed that not less than 57 percent were violating price controls. In some areas the figures soared to 70 percent."

Remember, Prohibition hadn't been over even ten years when the war started. There were a lot of folks who were willing and able to go back to moving illicit goods and making a big profit at it. They were pre-trained. Organized crime got into the gas racket, strong-arming even honest station owners into buying their counterfeit coupons.

In the OPA's 1943 film, Black Marketing (which you can see at YouTube or at Internet Archive) says there are a hundred black market slaughterhouses. This is only the meat chiseling part of the black market.

One ring of cattle buyers sold their meat directly to chain stores in Eastern cities, skipping middlemen (a shorter chain is stronger).

Junior and senior high students got assemblies where they were encouraged by OPA officials to help stop gas chiseling in particular, whether buying without ration coupons, using counterfeit coupons, or paying prices over the legal limit.

In 1943, Mark Miller drove from Brownsville, Texas, to International Falls, Minnesota, without a single gas coupon. He managed to get 123 gallons of gas anyway, and illegal coupons for 190 gallons more. He published the tale in Collier's, so the OPA revoked his 1944 ration book.

Newsweek said most housewives were hoarding. While still doing Victory Gardens and canning, they used up all their ration coupons, too. (Can't grow shoes or tires in a garden, but they got all the canned goods they could, too.)

According to Casdorph, due to an edict that about a third of whiskey production be reserved for after the war (?!), rum became the #1-selling liquor. (Fortunately, people had discovered the rum and Coke.) Lingeman says that the distillers had put aside a five-year supply before converting to industrial production, but it was used up. They were allowed to produce whiskey in August of 1944. This would require more research.

When whiskey, rye, bourbon or scotch could be found, the seller could make a killing, or at least have a mob at his door if he sold at legal prices.

In 1945 there was a serious meat shortage in most urban markets. 15% of the supply was siphoned to the black market. Butchers expected a cash tip every week, from $1 to $5, without which he was out of stock. How good the cuts were that were available to you depended on how much you coughed up. One Queens butcher just let it be known he'd remember who brought him liquor for Christmas: he got 500 bottles. Sugar was also in short supply. But a large-scale black market in cigarettes, gasoline, or liquor had disappeared.

The sugar shortage meant that candy-store owners were keeping back the best candies for children (or their parents) who would pay over the ceiling price. There was a black market in bubblegum!

At train stations, scalpers sold Pullman reservations for $10-50 over what they bought them for. Pullman meant you got a pull-down berth with canvas walls (and since they were two high, often the company of a stranger of the same sex), rather than sleeping sitting up in the chair of an observation coach.

The highest ticket items on the black market were wrist watches, which might sell $50 over the legal limit. Anything for the civilian market made of metal was hard to find, and housewives paid up to 14 cents over the ceiling price for steel wool pads.

"Maxwell and Balcom estimated that 8% of oil was purchased illegally, and willaimson estimated that in 1944, up to 125,000 barrels a day were illegally procured." (John Heitmann)

Sources:

Barrington Boardman. Flappers, Booleggers, "Typhoid Mary" & The Bomb: An Anecdotal History of the United States from 1923-1945.

Paul D. Casdorph. Let the Good Times Roll: Life at Home in America During WWII.

John Heitman. The Automobile and American Life. http://automobileandamericanlife.blogspot.com/2009/10/blackmarket-in-gasoline-during-wwii-gas.html

Richard R. Lingeman. Don't You Know There's a War On? The American Home Front 1941-1945.