The Audacity of Hops: The History of America's Craft Beer Revolution (17 page)

The craft beer movement had drawn an English critic to a backyard in the American capital, named for one of the nation's original homebrewers, to share ideas and a passion that might very well then spin off into a commercial enterprise. (Who knew? That was the way of things!) It was as sure a sign of progress, of awareness, as any roster of craft breweries or sales statistics (which were by and large guesstimates anyway due to the iffy distribution). There was
a catch, though. Just as the year 1978 in hindsight appeared to be especially pivotal, so would the mid-1980s. The congenial vibe summed up in Jackson's anecdote for his friend Papazian's book, born as that vibe was in the San Francisco of the 1960s, was about to run headlong into an entirely different one on the East Coast of the 1980s.

*
Its status as the bestselling homebrewing book takes into account sales from its 1991 revision,
The New Complete Joy of Homebrewing.

†
The full mantra became, “Relax. Don't Worry. Have a Homebrew”

I
t was sometime shortly after
Bert Grant filed incorporation papers with the State of Washington in 1981 to open the nation's first brewpub since Prohibition that he and Michael Jackson were blasting through the Cascades in a Rolls Royce with a license plate that read “Real Ale.” It was entirely appropriate given Grant's personality—as was the fact that he opened that first brewpub in an old opera house in Yakima in the heart of central Washington State's hop-growing bull's-eye.

Grant was a bit operatic himself, given to wearing kilts and waving a claymore at anyone who dared break his brewpub's smoking ban. A brash, brassy Scotsman from Dundee, his family moved when he was a boy to Toronto, Ontario, where he got his first job in beer at age sixteen during World War II: as a taster in a brewery. Others would follow, in Canada and the United States, including a fifteen-year stint as a brewing chemist at Canadian Breweries and then several years as research director with Stroh Brewing, then one of the largest breweries in the United States. He left that job in 1963, did some consulting work, and then joined the Yakima-based hop-grower S. S. Steiner in 1973. He was older than most of the twenty- and thirty-something first- and second-wavers in the American craft beer movement and the only one with true European roots who would end up an owner. He also fell outside the orbit of mentorship and word-of-mouth that had cultivated our characters to this point—he had come from decades within the brewing industry and not from a hobby or happenstance. Whatever his route, Grant had long dreamed of opening his own brewery, and legislative changes wrought by the legalization of homebrewing at the federal level opened an opportunity for him.

President Carter's signature on HR 1337 in October 1978 did little beyond freeing homebrewing suppliers from fears of a federal raid and allowing enthusiasts to congregate more openly. At the state level, things remained murky
regarding the legality of homebrewing—or of brewing simply on a small scale, either for commercial sale off-site or, in the case of a brewpub, on-site. In Carter's home state of Georgia, for instance, homebrewing remained illegal for years even as legislators in Atlanta OK'd home wine making. In Washington State, the legislature passed Senate Bill 3722 in 1981, making it legal to transport homemade wine for exhibitions and tastings, but did not move on the legality of beer at the state level for many more years. Still, the tweak to the law involving wine seemed to be all Grant needed—or he had always planned to go ahead regardless, serving under the radar. Until the law caught up with—or on to—them, he and others would be making up the definition of an American brewpub as they went along. Loosely, though, it can be understood at first to have simply meant making and serving beer under the same roof. Grant filed state incorporation papers for the Yakima Brewing and Malting Company on December 23, 1981. Early the following year, he set up Grant's Pub in the lobby of the town's old opera house and brewed four barrels at a time; he justified the “malting” part of the name by frying some early barley on a skillet in the kitchen.

Jackson was one of the operation's biggest and most important fans from the start. He praised Grant's eccentricities along with his beers, painting for his readers the picture of an iconoclast loose in the hop fields of America. Grant was undoubtedly partial to bitter ales, having come to despise the blandness of Big Beer lagers (he often carried a vial of hop juice to spice up any pale pilsner that crossed his transom); and Jackson would eventually declare his India pale ale “the hoppiest beer in America.” Grant's first beer at the brewpub was, appropriately enough, a Scotch ale—but not in the traditional sense.

“Isn't this on the hoppy side for a Scotch ale?” Jackson asked him in those early days of Rolls Royce rides.

“Yes,” Grant replied, “all beers should be hoppier.”

The world's leading beer critic pressed him. “Is it really fair to sell it as a Scotch ale?” Scotch ales were traditionally lighter on the hops and heavier on the malts.

“It is Scotch ale because I created it,” Grant said. “I am Scottish.”

“When did you leave?”

“When I was two years old.”

Clearly the iconoclasm redefining American beer was not limited to the craft brewers of Colorado and California. That Scotch ale would win second place in the Great American Beer Festival's consumer preference poll in 1984. Grant also took first place with his Russian imperial stout, which outpolled seventy-four other beers. He accepted the wins wearing a kilt.

As for those brewers in California and Colorado, they were finding themselves increasingly limited business-wise. Distribution, for one thing, remained
both a hurdle and a hassle. Grossman and Camusi were able to get their Sierra Nevada Pale Ale onto the shelves and into the bars of Chico, but when they tried to expand into the Bay Area proper they found slim pickings amid the available distributors. Most were in the pockets of Big Beer and had little use for what were considered risky brands that would never sell as reliably as more established ones. The only distributors even interested in Sierra Nevada were those trading in esoteric imports. Sales of foreign beers had tripled from 1975 to 1981 nationally as more brands arrived, including higher-end ones from Belgium, many for the first time in the States. The sorts of distributors willing to take these brands, themselves risky bets, were more apt to take on domestic craft brands as well. Grossman realized the distributors were utilizing a throw-it-against-the-wall-and-see-what-sticks approach; little marketing was involved. Tom de Bakker found the going equally rough, though he was able to sign on with two similarly niche distributors—only to have disbelieving retailers oftentimes plunk his beer on the import shelves. A backhanded compliment in a way, it was at least proof that more craft brands were feeling their ways into a wider marketplace. It was a positive.

O
n June 6, 1979, Jack McAuliffe
wrote this letter to his father and included a copy of Frank J. Prial's
New York Times
story on New Albion. Its stouts, porters, and ales were selling well in the Bay Area, and McAuliffe and Stern were even planning to haul samples to the august Great British Beer Festival that autumn—as symbolic a move by any American craft brewery as there could be. Moreover, the brewery had added a new level of forward-looking professionalism with an official board of directors, including Stern and McAuliffe as well as people culled from other areas of expertise. Unlike the letter of last August, this one was written under a New Albion letterhead that included the re-creation of Francis Drake's Golden Hind:

Here's a clipping from
The New York Times.
As you can see from the photo, the labor involved here is brutal.

We've recovered from a brush with bankruptcy and are now making money—it's good to have a banker on the board.

We have a crew from Davis here for [work study] for the summer. I am working on the plans for the next brewery and we are going to look at property Saturday. I have written to brewery architects & they say it is going to cost between $900K & $1 million. I'm going to get the money …

Love,

Jack

It was a race. Since 1980, the brewery had been profitable, but not profitable enough. Employees like Barkley made peanuts, plus beer; McAuliffe and Stern made barely anything, maybe forty dollars a week each, enough to buy food. For the fiscal year ending June 30, 1980, for instance, New Albion's profits were $8,262.52 from sales totaling $79,639.80. It could not go on like this, and McAuliffe had looked to expand starting as early as 1979, the second full year of operations. He sought out potential investors; he approached commercial banks with business plans; he got a right of first refusal on property for what was supposed to be a nice, English-style brewpub in downtown Sonoma. He outlined the plan to Prial, sketching like a zymurgical da Vinci a picture describing not only every brewpub that would come after, including Bert Grant's more than two years later, but the ideal habits of people like Waters, people who we decades later would call locavores:

At New Albion, water must be trucked in once a week or so from a well in the nearby mountains. “We'd like to go to 50 barrels a day eventually,” Mr. McAuliffe said, “so we have to get nearer a good water source.” Actually, his plans are more ambitious than that. He hopes one day to open a country inn with a small brewery attached. “We'd lease the restaurant, of course,” he said, “but they'd be closely connected. Guests in the restaurant could see the beer being made.” But that's still not all. “I'd like to have a farm as part of the property. Then we'd grow our own barley and malt it. It would be a totally contained operation. There is nothing like it anywhere.”

The usual twelve-hour days continued. There were bright spots, too, amid the stress and worry over expansion. On the same trip that Stern and McAuliffe hit the Great British Beer Festival, they traveled to breweries in England and Scotland, the birthplace of McAuliffe's interest in fine beer. There were parties
with Anchor employees like Gordon MacDermott and Mark Carpenter, usually on or around the winter solstice and usually involving heaping amounts of pork and generous volumes of beer; one year the Anchor guys showed up with a palate of low-fills, bottles that didn't quite get filled to the top—Barkley figured they must have been saving them up. There was more media coverage and more visits by Michael Lewis and his students. And there was even a Bay Area beer-tasting contest in February of 1982, hosted by a pair of PR and advertising executives; New Albion's pale ale won, followed by its porter, and then a tie for third between New Albion's stout and Anchor's signature steam beer (we should take the results with a grain of salt, however—McAuliffe and Carpenter were among the judges). Through it all there was that race for more money. At least one acquaintance of New Albion promised to find investors; that never panned out. McAuliffe mostly encountered responses like these from traditional lenders:

“You're taking on Augie Busch and all of his friends?”

“Are you guys nuts?”

“We're not going to give you $750,000 for something as loony as that!”

It looked as if New Albion was going to lose.

So were others. Tom de Bakker's eponymous brewery was turning a profit by 1982, producing eighty to one hundred barrels annually out of the warehouse in Novato, with two distributors running it to shelves throughout the Bay Area. As many as four other people worked at the brewery at a time, and visitors popped by, like they did at New Albion, including homebrewing clubs and reporters. The brewery appeared to be a victim of its own success. It was a Catch-22: de Bakker knew he had to expand to keep the profitability going, but in order to expand he needed loans; and traditional lenders, as we've seen, had no interest in propping up a small commercial brewery. In addition, the deep national recession meant a spending crunch among consumers—with the unemployment rate at more than 10 percent, higher than at any time since World War II, tipplers were increasingly unwilling to dig into their pockets for DeBakker bottles at ninety cents to a dollar or more a pop. The de Bakkers ran the numbers and decided to close in early 1983.

The Courys in Portland had shuttered their Cartwright Portland Brewery the year before. The California Steam Brewery, which had opened in San Rafael, just down the road from DeBakker, disappeared way before that. The years 1982 and 1983 were proving to be the first shakeout of the American craft beer movement, as second-wave entrants with plenty of spirit and skill buckled under the expenses of production and the challenge of distribution in a marketplace that simply was not ready for their bitter creations. It was an
appropriately bitter coincidence, indeed, that in March 1982, Anheuser-Busch rolled out in forty states Bud Light, the Goliath's long-anticipated answer to Miller Lite. The debut would lift the nation's largest brewery to a market share of 32.5 percent and sales of 60.5 million barrels the following year—more than all the beer sold by all the craft breweries since Fritz Maytag took over Anchor in 1965. And all against an industry backdrop of six brewers controlling more than 80 percent of American beer sales. As a “grim, determined and serious” August Anheuser Busch III—”the word relax doesn't seem to be in his vocabulary”—told an apparently awed reporter that year: “There are no easy answers to gaining market share. Only constant pressure, constant attention to the marketplace.”