Final answer:
The Sedition Act of 1918 restricted American civil liberties by criminalizing speech deemed disloyal to the government or war efforts, infringing on the freedom of speech and resulting in the prosecution of around two thousand people. Therefore, the correct option is B. It restricted American civil liberties.
Step-by-step explanation:
The negative consequence of the 1918 Sedition Act was that it restricted American civil liberties. Enacted during World War I, it imposed harsh penalties on those who used 'disloyal, profane, scurrilous, or abusive language' about the U.S. government, the Constitution, the military, or war efforts.
Not only did it infringe on the right to free speech, as guaranteed by the First Amendment, but it also resulted in the prosecution of approximately two thousand people, including notable figures like Socialist Party leader Eugene V. Debs. The act was seen as part of a broader pattern of repression, including the Espionage Act, which sought to stifle dissent and related activities during wartime.