I'm off this afternoon to talk about Indiana Liquor Laws to the (aides of) about 50 Indiana Senators and Representatives. Here the talk:
Nov
20, 2015 – State House
Bob
Ostrander
WELCOME
My bio is
probably in order first. After 15 years in Data Processing I started
a company, Public Brand Software, that distributed shareware mail
order. On disks. 360K disks. It was Inc Magazine's 95th
fastest privately-owned company in America; so when the Internet
came around I sold to Ziff Davis, publishers of PC Magazine.
Three years
later Ziff closed the Indianapolis operation but that whole internet
thing seems to be working rather well.
Since then I've
owned pieces of a bar and a brewery, helped some start-ups, and
created the IndianaBeer.com web site and blog. I've also written
Hoosier Beer, Indiana
Prohibition, and the 4-volume
Indiana Bicentennial.
All available at Amazon of course. And I stayed at a Holiday Inn
Express last night.
If you have any
questions, just shout them out.
Let's start
with a 5-minute history of the events in Indiana that led to two
periods of Prohibition.
Way back
when, the land this building sits on was inhabited by everything from
squirrels to mastodons. Then the Ice Age covered most of northern
Indiana but it went away and left rivers and hills to the south. Then
came the first human immigration. Paleo-Indians roamed this far north
from Mexico and left mounds scattered across the state.
The “Native”
Indians that met the Europeans came from the east having been pushed
out during the Beaver Wars in New England.
Then the French,
Spanish, and finally Englishmen used the midwest as an endless source
of meat, firs, cropland and wood.
TERRITORIAL
GOVERNMENT
The English
gained control and the Indiana Territory was formed in 1790.
Territorial Governor William Henry Harrison had complete
quasi-military control of the state. He immediately instituted the
first Prohibition law in Indiana, prohibiting furnishing liquor to
Indians and soldiers.
This was a year
before the federal government put a liquor tax into effect (which was
the U.S.'s first tax rather than excise on imports). That, of course
was the basis of the Whiskey Rebellion in Pennsylvania. Something
that we out in the hinterlands didn't even notice. Oh, and the soldiers went back to wet status
in 1795.
Jean Jacques
Dufour moved to Vevay and started growing grapes In 1798. His was the
first successful winery in the U.S.
Maybe it wasn't
great wine but people did buy it at $2 per gallon. It would be 200
more years before true two-buck chuck came to Indiana. Dufour's book
The American Vine-dresser's
Guide, Being A Treatise On The Cultivation Of The Vine, And The
Process Of Wine Making” is
still in print.
Harrison put
in other rules before leaving when Statehood came in.
1805 – No
liquor could be sold within 30 miles of any meeting with the native
tribes.
That same year
came licensing of taverns. The county courts sold these licenses at
$12.
1806 – The
area within 40 miles of Territorial Capitol, Vincennes, was declared
dry to Indians.
1807 – Sales
to minors was prohibited. A minor at that time was under 16 years
old.
1810 – Militia
officers were forbidden to furnish alcohol to enlisted men. This
might have been because the men voted on who would be their officer.
Or maybe it was just that officers were cheap.
STATEHOOD
Statehood in
1816 saw a new power base in Indiana in the form of Jonathan Jennings
and the original 43 men who wrote the Constitution.
The state
immediately started licensing breweries. Two got licensed that first
year - one by Ezra Boswell of Richmond and the other by the New
Harmony Colony – which had been making beer, whiskey and wine for
many years as part of the Utopian society's income.
Prohibition of
Sunday sales also popped up right away. To get a license, taverns had
to have 12 petitioners (free white males) that would affirm the
licensee was a person of good moral character and that the inn would
be for the convenience of travelers. This, of course, didn't slow
down new tavern starts but the $500 surety bond needed took inns from
the front rooms of roadside farm houses to specialized businesses. By
1819 an inn had to have rooms to let. This changed the landscape from
roadside rests to what passed for hotels in the day.
A few more
breweries opened early on and most of these quickly failed. Jacob
Salmon in Madison did have one that lasted until the civil war as
Greiner's. Edward Mason in Fountain City was run out of town by his
fellow citizens. New Harmony shut down production in 1826 then sold
to teetotaler Robert Owens the next year. Boswell's Richmond brewery
closed in 1831.
1855
PROHIBITION
This might be
a surprise but the first statewide Prohibition in Indiana was in 1855.
Alcohol was very
contentious after the Civil War. There were more distilleries and
breweries but the temperance movement had lots of wealth and
attracted crowds for the preaching extravaganzas.
That
no person in this state shall drink any whisky, beer, ale, or porter
as a beverage, and in no instance except as a medicine.
This
was passed by the Senate
29-18 and the House 51-41 in 1855. It was completely a push by the
Democratic Party who had control of both houses (– 26-24 and
57-43). Note that wine and cider were still allowed.
The law allowed
medicinal alcohol and set up a state agency to stockpile and sell it
to distributors in the drugs trade – those are the people who had
the distribution lines to the pharmacists. They got paid $1,000 each
for this task.
Many lawsuits
followed., by distributors, breweries and distilleries. Appeals came
from both sides, commerce and constitutional (you've heard this story
before, right?) In the end the Supreme Court of Indiana found the law
unconstitutional. The state government lost about $100,000 dollars
directly on this effort – does anyone want to estimate how much
that would cost now?
Prohibitionists
were not amused but went on to other things including Anti-German
terrorism in Cincinnati, Louisville and Chicago. Tipplers were not
amused by the prohibitionists and staged The Lager Beer Riot of
Chicago in 1855 to protest an Illinois dry-Sunday law. This resulted
in one death and 60 arrests.
POST-CIVIL
WAR
It took 50
years but Prohibition did come around in 1918. During the interim:
There were 56
breweries in Indiana at the start of the Civil War. The Feds put a $1
per barrel tax on beer for funding. The number of these small
breweries dropped a bit but after the war bounced back to 67.
In 1872 the
National Prohibition Party was formed, getting 2,100 votes for
President.
“Baxter Laws” came around in 1873 and
were about the most onerous the Republican Party could put into
place.
A tavern license had to be
supported by a petition of half of the voting-eligible inhabitants
(still white males). A $3000 bond had to be financed. Taverns needed
to close at 9pm. No sales were allowed on Sundays, election days, to
minors (still 16), and habitual drunkards. Who determined the status
of habitual drunkard? The wife or family of any person could tell a
landlord the person was one and on that word the landlord had to shut
off the taps to him.
This and other instances of overkill were
too much for the average person and they voted the Democrats into
both congressional houses in 1880. Being
the ex-opposition party, they put different rules in place. Not
necessary wetter or drier, just different. Not toothless but still
needing some dental work.
Closing time
went to 11pm. Public intoxication became a crime. The age of majority
raised from 16 to 21. Minors buying liquor became a crime for the
buyer rather than the seller. The “habitual drunkard” part of the
earlier laws, Sunday and election day sales restrictions were all
kept.
TEMPERANCE
Temperance
campaigns started up big time then. Rallies in dozens of cities,
small and large, attracted crowds and contributed to the coffers of
the Womans Christian Temperance Union, the Anti-Saloon League, the
the Prohibition Party. Smaller efforts were the red ribbon campaign,
the blue ribbon campaign, the Youth Temperance Alliance of America,
the National Temperance Society, the International Reform Bureau, the
Catholic Total Abstinence Union, the Order of the Sons of Temperance,
the National Christian Board of Temperance, the Dry Democratic
Organization and the Indiana Dry Federation.
Even the Klu
Klux Klan of Indiana supported prohibition. They were instrumental in
putting Indiana Secretary of State Ed Jackson and U.S. Senator Samuel
Ralston in office. The KKK was anti-alcohol as well as anti-Catholic,
anti-Jewish anti-Black and anti-gambling. Then, in 1926, it all
unraveled when Indiana's Grand Dragon, D.C. Stevenson, outed
government Klan members and was convicted of abduction, rape and
murder.
The largest of
the dozen dry campaigns was carried on by Indiana's own Billy Sunday
who preached to millions in temporary wood gathering halls in towns
from Boston to Kansas from his home in Winona Lake. These halls
usually held about 20,000 people and Sunday often received the entire
collection plate. His most famous sermon was called The
Water Wagon and
“get on the water wagon” became a rallying cry for many
prohibitionist organizations.
“I am the
sworn, eternal and uncompromising enemy of the Liquor Traffic. I have
been, and will go on, fighting that damnable dirty, rotten business
with all the power at my command.”
Sunday was
pro-women's suffrage, against child labor, capitalists, Jim Crow,
dancing, immigration, theater, evolution, cards and novels. He became
quite wealthy of course and the call for dryness did not end with
Prohibition or even Repeal. The Prohibition Party Convention was held
in Winona Lake in 1948 and they got 103,489 votes nationwide.
(In 2012 the
Prohibition Party Convention was held at the Adams Mark Hotel at the
Indianapolis Airport and the slate got 519 presidential votes. Total.
Nationwide. Their convention for 2016 has been canceled.)
LOCAL AND
COUNTY OPTIONS
The Republicans were back in charge in
1881 when they and the Methodist Church tried again with
constitutional amendment that went nowhere due to the opposition of
State Senator John Hill who was an investor in the Madison Brewing
Co.
Other state laws allowed cities to collect
brewery taxes and taxes from distributors. That was declared
unconstitutional in two years.
In 1895 the Nicholson law allowed
remonstrants against tavern licenses to file objections to any
license. This resulted in 167 townships and 6 cities going dry.
The Moore Amendment allowed not only specific
objections but let white adult males put in an ongoing objection to
all liquor licenses. In effect this made a “NO” result standard
that each tavern would have to fight by getting out the vote. 24
counties, 32 towns and 18 cities went dry under this rule. This could
be expensive to impossible since the rules required no check on the
signatures on remonstrances.
There were some cases where breweries tried
to stay open by shipping their output across county lines. The
Huntington Brewing Company was the focus of a local-option raid in
1911 where the owners were not jailed as “they employed a number of
men about their plant who would be thrown out of employment if [the
owners] were deprived of their liberty” - Indianapolis Star, June
13, 1911.
FRANK HANLY
Governor Frank Hanly was the Governor from
1904 to 1909. He and the Republicans were voted in on an
anti-alcohol, anti-gambling platform. He immediately called a special
session to pass local options. (Sen 32-17, House 55-45 along strict
party lines.)
By 1907 counties could vote themselves dry –
something which 70 did (but 43 rescinded). By the time Prohibition
came around in 1920 there were ten states with county-option dry
areas: Idaho, Indiana Illinois, Michigan, Minnesota, Montana,
Nebraska, Ohio, Oregon and South Dakota.
TERRE HAUTE
It's worth a breath about Terre Haute in the
early 1900s. City candidates routinely handed out business cards that
could be exchanged for a glass of beer at any tavern in town.
The 1900 Census noted 14 houses of
prostitution in just one block of Second Street. Mayor Donn Roberts
was convicted of election fraud in 1915 and went to prison. 7
breweries made Terre Haute the largest beer culture in the state. 5
large distilleries had been going since before the Civil War. A very
interesting town to investigate.
NATIONAL
PROHIBITION
The US's 18th amendment started in
1920 but Indiana already had a Prohibition – since 1918.
The Republicans
took over all the major state offices in the 1916 elections. The
Governor, Attorney General, Secretary of State, Treasurer were all
lost by the Democrats as well as control of the House. The Senate
ended up a tie when the Democrats lost 24 seats.
The Anti-Saloon
League gave the legislature a petition with 250,000 signatures and
newspapers around the state cried “DRY” in big headlines. Indiana
was dry with a vote of Sen 70-28, House 38-11. Governor Goodrich
signed the law immediately and April 2, 1918 became Dry Day.
During
Prohibition, people, of course, were out of a job in distilleries,
breweries, wineries, and pubs. We don't have good counts for this but
we can count during Prohibition, 40 breweries closed their doors and
18 reopened afterword.
Have you noticed
that Prohibition was and still is the only Constitutional Amendment
that takes away rights from the people?
Indiana was the
35th state to ratify Prohibition. Nebraska was next, three
days later, giving the 36 needed for the amendment to take effect.
PROHIBITION LAWS
The National
Volsted Act set down rules for everyone, but several states
instituted their own more onerous laws.
In Indiana the
Wright Bone Dry Law was an omnibus that took effect in 1925. It
called for:
$500 fine and 30 days in jail for
possession of any alcohol
Empty bottles and even the smell of
alcohol were evidence of guilt.
Alcohol in a vehicle was a felony.
The owner, driver and passengers of a car were guilty if a rider
even had a flask.
Local prosecutors were given a
personal $25 bonus for each conviction.
Medicinal sales were outlawed.
The law went so far as to ban the
sale of cocktail shakers and hip flasks. With the jazz age coming on
strong, these were fashion items but at least they didn't outlaw
garters.
There were 250 arrests the first week the
Wright Bone Dry Law went into effect. Statistics aren't available but
many historians estimate 10,000 arrests in Indiana alone resulted
before Prohibition ended.
EFFECTS OF
PROHIBITION
The effect on
workers was staggering. Not only breweries, distilleries and the few
wineries laid off people but the taverns (most of them anyway) closed
up putting thousands of men on the street. Yep, men only – women
could not yet work at a bar.
Obviously
thousands ended up in jail. The KKK and the Horse Thief Detective
Association (which both had a history of post-war lynchings) took it
on themselves to anoint 20,000 “constables” who raided gambling
houses, arrested people in parked cars and generally carried on a
pogrom of harassment. Most of their arrests (or kidnappings) never
made it to court simply because their badges were completely bogus.
These “constables” were also never arrested for kidnapping, false
arrest, or impersonating a law enforcement officer.
But then, as
now, rank had its privileges. Governor Ed Jackson's wife was treated
by a doctor with alcohol. Attorney-General Arthur Gilliom treated his
wife and 3 sons with alcohol. The head of the Anti-Saloon League,
Reverend Shumaker, was found to have a daily elixer, Busho Tonic,
that was 23% alcohol, He also treated his wife and 1 son with Busho.
In the end of
this, Reverend Shumaker was convicted of libeling Attorney General
Gilliom and was pardoned by Jackson.
The Indiana
State Medical Association petitioned for a repeal of the non-medical
use portion of the Wright Bone-Dry Law and it was removed in March,
1933, just in time for repeal.
There were some
positive aspects of Prohibition. Drinking overall dropped by 30% and
deaths by cirrhosis dropped by 64% by 1929.
PROHIBITION BUSINESSES
Various
companies around the state saw their business drying up since
producers didn't need their wares. Uhl Pottery of Huntingburg had
made beverage glasses, Root Glass of Terre Haute had made bottles,
and dozens of large cooperages shut down.
Root
Glass, by the way, did just fine because their design for a new Coca
Cola bottle was accepted, resulting in those fluted bottles we are
still familiar with rather than the straight-sided bottle Pepsi uses.
We also need to
look at how some producers tried to stay in business during
prohibition. Many tried to make soda pop (orange, grape and lime were
popular). Some made “near beer” a non-alcoholic beverage that
tasted somewhat like beer, maybe; I haven't tried it. Others made
various food products from grain and a few made “baking yeast” or
Malt Syrup which actually came with instructions to not introduce
yeast to the syrup for fear it would turn it into beer. Obviously
this was a popular product but the results evidently produced poor
results.
Others hooked up
with mob interests such as George Remus in Cincinnati who transported
booze mainly to Chicago under a federal permit to make medicinal
alcohol. His venture became Fleischmann which, yes, makes yeast and
also makes “neutral grain spirits” sold to what are called
rectifiers who add flavorings, bottle, and put out boutique brands.
Remus himself went to jail for killing his wife, Imogene, in 1927
after she testified against him in a trial for violations of the
Volsted Act and mobster activities. She had sold their home and took
off with the money.
It's not easy to
document these times because no records were kept, bootlegging being
illegal and all. Sort of like the Underground Railroad which is now
claimed by many old farms, barns, churches, warehouses.
The Hammond Distillery sold their raw
whisky to George Remus until at least 1923.
The Lawrenceburg and Aurora
distilleries were effectively run for the benefit of Remus.
The Hoham brewery in Ply mouth was
sold and the new owners built a vary large “fruit cellar” that
turned into a brewery, speakeasy, beer garden, bordello, and inn.
They were raided in 1928 arresting 35 customers. The place was
padlocked for one year. The family says the fruit cellar was used in
the Underground Railroad and notables including Zeppo Marx were
caught in that raid.
Muessel Brothers in South Bend sold
their beer to the Detroit mob of Giacamo Tocco and Al Epstein.. This
same organization fixed up the selling of Muessel to Drewrys of
Canada in 1936.
T.M. Norton of Anderson made some
full-strength (5%) beer along with their soft drinks and ice
products. Two truck drivers were arrested while taking 29 barrels of
beer to Cincinnati – probably George Remus but the court records
don't say.
Paul Reising Brewing of New Albany
made Hop-O and Hop-O Dark near beers, but some batches had as much
as 7% alcohol. In 1922 three men from Reising were caught by T-Men
who hid in a closet listening to price negotiations and logistics
with a Louisville distributor. Then-president Michael Schrick lost
his job but was then named the Senatorial campaign manager for James
Watson.
REPEAL OF
PROHIBITION
Gosh, this
wasn't even a contest. The U.S. Congress passed the 21st
Amendment by 63-21 and 289-121. In just 9 months it was fully
ratified and went into effect.
Once the 21st
was ratified, the Indiana legislature immediately repealed the Wright
Bone Dry Law and Governor Paul McNutt emptied 982 people from the
jails.
Continuing
restrictions were many. Lots of favoritism went on (or buying votes,
if you will). A fight with Michigan changed national law. It went
this way:
Distributors in Indiana got a new law to
deal with in 1933. “Imported beer” (being from another state)
required a separate $1,500 license and a $10,000 bond. Only 13 were
sold. Michigan countered with a tax on beer from Indiana. Their law
got upheld by the U.S. Supreme Court as the 21st
amendment said states had full control on liquor. Missouri and Ohio
got into the act with taxes (port of entry fees) on Indiana beer and
finely an accord was reached for everyone to kill all those
self-defeating regulations in 1938.
1939 – The
Alcoholic Beverage Commission was formed to establish rules for
alcohol. They raised the excise tax on beer to 4¢
per gallon This and license permit costs, of course, are raised quite
often.
1940 – Terre Haute Brewing Company put
brewing dates on their labels. This is the first anywhere. Note this
isn't an expiration date. Nor is it a legal mandate.
1941 – Tavern licenses were limited to one
for every 1,000 people in the county – except for Lake County next
to Chicago where it was 1 for every 500.
1947 – Taverns have to serve food in order
to serve alcohol. This is still basically on the books.
1948 – Sales were banned on the day after
each holiday.
There were 11
Hoosier breweries in 1950. This tumbled due to mergers, wider
transportation and mainly television advertising, especially those
aimed at sports fans.) Only 4 breweries were still open 1960. The
count went down to 2 in 1980 but is now 104.
Now let's talk
about the rules you people put into effect that allowed this
tremendous growth. Thank you and your predecessors from about 80% of
us Hoosiers for the sensible laws that are now in the books.
1963 – Cold beer and wine were allowed to
be sold in liquor stores. This continues to the present day and while
groceries may not have chilled product, taverns and breweries may
also sell cold beer to go.
1973 – State liquor laws were completely
rewritten which put everything together as Article Title 7.1 If you
are interested in seeing the latest iteration of the law, go to the
Indiana Government web site at iga.in.gov.
1976 – Approval of the artwork on wine and
beer labels was necessary. This is now done basically by the Feds's
Bureau of Alcohol, Tobacco, Firearms and Explosives – why have
duplicate effort?
1979 – The ABC allowed exclusive
territories for liquor distributors. This let the more powerful
distributors slice up the state into duchies and effectively set up
monopolies. It became known as the “Beer Baron” rule.
1979 – Permits became required for
bartenders and store clerks. The rule requiring a permit for dancing
was abolished - except for nude dancing, which continued to be
prohibited.
1984 – MADD got the 21 year old drinking
age passed in every state. Younger than that and you couldn't buy
alcohol or display it in public – not a total ban.This or the state
lost 10% of its highway funding. The result was country wide of
course with Indiana being one of 7 that put in a full drinking ban.
1984 – Package stores were allowed to give
wine samples.
1984 – A lawsuit allowed sales of warm
beer and wine at grocery stores and gas stations.
1988 – The familiar health warning on
bottles and cans was instituted at the Federal leval. No studies have
been made on whether this has ever been read.
1989 – A repeal of the “Beer Baron”
rule was killed by Evan Bayh's veto. In 1979 there were 200
distributors; by 1989 there were only 80.
1994 – Drug stores were allowed to sell
liquor.
2001 – Governor Frank O'Bannon let the
Beer Baron rule die. Now distributors usually set up territories by
contract with the producers and importers.
1999 – Mail-order purchase of beer and
wine was allowed by a federal court decision. The state appealed to
the U.S. Supreme Court which confirmed the lower court.
2004 – Grocery stores may sell alcohol
(warm).
2005 – Liquor stores can provide samples
to customers.
2010 – Photo ID must be produced to buy
alcohol.
2011 – Photo ID must be produced to buy
alcohol unless the purchaser appears to be older than 40 years of
age. (Most grocery stores and some liquor stores still check ID.)
2014 – As of 2014 but breweries could only
sell directly to pubs and stores if they made less than 30,000
barrels of beer per year. Bigger than that and they must use a
distributor, can't have a brewpub, and cannot sell or give away
samples at their place of business without providing food. Luckily
food trucks do count as food so many places work with the temporary
trucks for sausages, pizza, and other food availability, often on a
regular weekly schedule. Better than a can of soup on a hot plate as
in the old days.
2015 – There were three breweries that
bumped up against the 30,000 barrel limit: Three Floyds in Munster,
Upland in Bloomington, and Sun King in Indianapolis. A bill this year
expanded this limit to 90,000 barrels. Thank you.
Thanks for coming. You'll find more at
indianaprohibition.com or in my book at Amazon.
Hop Back Odyssey Best Bitter
John Pilling owns another brewery in the area, the North Cotswold Brewery on the south border of Warwickshire, which he bought just a year ago. With a 10-bbl system, he produces Pig Brook session ale and a seasonal beer each month. In 2006 he hopes to market 20 different beers for the 50 pubs that carry his beers as guest ales on their hand-pulls.
The ZeroDegrees brewpub in Bristol is in the Good Beer Guide but it's not clear why. When we were there no real ale was in evidence, neither were there any handpulls sitting idle. It's a ultra-modern downtown technopub and restaurant with pizza, mussels, and pasta on the menu. In other words, easy fixing food.
Got to go to the Norwich Beer Fest for a day. Over 200 ales direct from the casks. Ciders, 50 Belgian beers.
Posts
