So, my main source for this is Deborah Blum's wonderful "The Poisoner's Handbook", which covers the origins of NYC's forensic labs.

A good chunk of Prohibition alcohol was industrial alcohol- think things like disinfectant, nail polish remover, etc. Usually wood grain alcohol, denatured with various chemicals. It was meant to be reprocessed to be safe to drink. It didn't always work, people died. But the process got better.

So. The government requested a higher level of denaturing. People like the NYC medical examiner pointed out that this would kill people. (One recipe could cause blindness in three or so drinks, by one estimate.) The government and supporters of Prohibition mostly shrugged and said that it wasn't their fault people were trying to kill themselves with poison. Note, it's not clear if people knew what was denatured alcohol or imported drinks, as well.

https://time.com/3665643/deadly-drinking/ https://daily.jstor.org/darker-side-prohibition/ http://prohibition.themobmuseum.org/the-history/the-prohibition-underworld/alcohol-as-medicine-and-poison/