Happy Days Are Here Again
At 12:01 a.m. on April 7, 1933, brewery whistles around the country heralded the return of beer. Throughout the night before (fondly dubbed “New Beer’s Eve”), jubilant beer drinkers lined up outside breweries, anxious for their first taste of legal beer. In Milwaukee, where crowds were said to have been 50,000-strong at the breweries, beer drinkers hauled away their precious kegs and cases in everything from wheelbarrows to baby carriages. In New York City, movie houses played the newly-released film, “Beer Is Back!” Around the country, night clubs, hotels and restaurants–most filled beyond capacity–struggled to keep the taps flowing as raucous crowds downed an amazing 1.5 million barrels of beer during the first 24 hours that beer was back.
Many grateful brewery owners sent complimentary shipments of beer to President Roosevelt. August A. Busch made his presidential delivery in grand fashion, employing a bright red beer wagon drawn by six Clydesdale horses. The spectacle, of course, has since become a sacred corporate symbol for Anheuser-Busch. Officials at the Yuengling Brewery of Pottsville, PA, were dismayed to learn that their shipment of beer to Washington arrived missing 73 cases. Indeed, as truckloads of beer crossed America’s highways during those first few days, some brewers were compelled to hire armed guards to protect their beer shipments against hijackers.
The Sobering Reality
Once all of the ballyhoo of New Beer’s Eve and New Beer’s Day had subsided, beer drinkers and brewers awoke to a sobering reality. The 5￠ mug of beer–a time-honored institution before Prohibition–was but a quaint memory now. For the better part of a half-century before Prohibition, the federal tax on beer was fixed at just $1 per barrel. Only during times of war was the tax increased temporarily. But those days were gone forever. Congress had re-legalized beer largely on the basis of its potential as a government revenue builder. Accordingly, the federal tax was set at $5 per barrel, plus a $1,000 annual license fee for each brewery. Today, the prevailing tax of $18 per barrel (though lower for production under 60,000 barrels) suggests that beer’s role as an important federal revenue stream remains fully intact.
Heavy taxation of beer, however, is not Prohibition’s only surviving legacy. A strong regulatory environment was also a key component of repeal. First and foremost, lawmakers were eager to legislate against the historically tight relationship between brewers and saloons. The “tied house” system, according to its opponents, gave rise to the “poor moral condition” of America’s saloons and was the very fuel that drove the Prohibition movement. Even today, there remains a strictly-regulated separation between brewer and retailer.
The old-time saloon itself, in fact, was a casualty of Prohibition. The designations “tavern,” “club,” “bar,” and “cafe” were much preferred by entrepreneurs hoping to side-step the stigma of pre-Prohibition “grogshops” and Prohibition-era speakeasies. Some state legislatures even sought to erase all remnants of the old-fashioned saloon environment. Swinging doors, for example, were outlawed in some regions. In others, the law required that bar stools be provided for all patrons since it was thought that standing at the bar–a venerable saloon tradition–promoted excessive drinking.
Government regulation, however, did little to restrain what was perhaps Prohibition’s most sinister outgrowth. The criminal groups which had made widespread disobedience possible–and profitable–throughout Prohibition emerged in 1933 strong, well financed and well connected. Crime was now organized, and these criminal institutions are with us still today.
But, without question, the most critical legacy of America’s dry era is the wisdom offered by its monumental failure. The Eighteenth Amendment was officially and forever repealed on December 5, 1933, with the ratification of the Twenty-First Amendment. To this day, national Prohibition remains the only constitutional amendment ever to be repealed.