Yes, that's why despite the repeal of the prohibition the Mafia is still as strong as ever. Right.
Quite relevant to this discussion, I think would be that after prohibition ended (1933) the vast majority of organized crime *did* indeed lose all their black-market booze money, though there were still *plenty* of existing illegal activities for them to continue to capitalize on (prostitution, existing blatantly racist drug laws, e.g. the Harrison Act from 1914), and some new ones which conveniently materialized,only 5 years later, for instance: the Marijuana Tax Act)
Obviously we can't legalize actual violent crimes or bribing/blackmailing lawmakers, that organized criminals profit from. Though legalizing and regulating simple possession and sale of a freaking dried plant or some powder, would likely free up law enforcement resources to deal with those kinds of things. Again, one could argue that that's not a certainty, but what is?
We'll never find out *for sure* if "legalizing everything" will *drastically* reduce violent crime, unless we do it (it couldn't be more of a disaster than prohibition if that experiment failed) though, I think it's disingenuous to suggest that it wouldn't reduce violent crime at all, it's really pretty simple to see that it would.
The important question is: would legalizing the drugs cause more harm than the increased violence that their prohibition causes (directly and indirectly)?
I suppose that's a complex question, but I've never seen *anyone* present hard evidence that it would. In fact the evidence is growing from countries like Switzerland, Holland and even the UK -- that drug legalization/decriminalization programs do indeed have a net positive benefit to a society currently undergoing drug prohibition, especially when coupled with a good public health program for treating addiction, even though, seemingly there are some people that don't seem to be able to stop their self-abusive behavior. But if they are getting their drugs from a clinic, for free even, they're probably not out knocking over a liquor store.
Some of the same people who say that there's no climate change because it snowed last week would say that "the science isn't in" on this one too, and while they may have a point (albeit possibly for the wrong reasons) -- sometimes you have to do something, even with "limited data", simply because it's the right thing to do, even with risk of failure, or risk of making things worse.
Since hey, if it doesn't reduce violent crime, or generates millions of new addicts (yeah, right), then launch the war on drugs "reloaded" or whatever.
With alcohol people realized after only a decade that it wasn't helping (or maybe more because a few too many senators and their buddies got caught drinking.)
After over 70 years of racist, poorly-conceived reactionary drug policy, it's time to do something to change it. I'd suggest that "legalizing everything" would be less harmful than what we have now, in almost every way -- but ideally there would probably be some kind of regulation, which is something that would require mature, reasonably smart people, with the authority to enact law to sit down and discuss the issues and listen to people who have actually already studied and thought about the issues -- I wonder how long it'll be before the US has that.