I attended the Craft Brewers Conference in Washington, D.C., last week.
It was a massive gathering of 6,500 or so brewers that expands each year as the number of people already in the industry, and those wishing to enter it, continues to grow apace.
Each year, Paul Gatza who is the executive director of the Brewers Association, gives a State of the (Craft) Brewing Industry report that, in most previous years, has been remarkably expansive and upbeat; this year he mused whether we were not reaching the status of Peak Beer (you know the reference to Peak Oil) wherein the market can hardly absorb any more craft beer or at least brands of craft beers.
He reported there are now some 2,400 operating small breweries with about 1,200 in the planning and construction stage: At this rate of expansion by 2050, he said, there will be one small brewery for every beer drinker in the USA!
Clearly, the craft brewing industry is a modern success story and not in this country alone: It is also a bright spot in Britain where the craft brewing segment is also expanding. Although the overall beer industry in this country faces declining sales, our brewers met their Waterloo with Prohibition in the 1920s. The British brewing industry went through a parallel disturbance much more recently; that calamity we can trace to one unusual person whom Napoleon doubtless would have admired.
I am always sad to learn of the death of any person. There is an extinction of a personality that has affected my life in some way and I inevitably feel the loss. I have on my office wall a calligraphy made by a Davis artist, who herself is now dead, that reminds me of this; she records, in her beautiful hand, the famous and inescapable, immortal and perhaps chilling, words of John Donne that end thus: “Any man’s death diminishes me because I am involved in mankind. Therefore never send to know for whom the bell tolls. It tolls for thee.”
Therefore it was with mixed emotions that I learnt of the death of Baroness Margaret Thatcher, former prime minister of the United Kingdom, who died a few days ago at the age of 87. She strode the world stage for the 11 tumultuous years she was in office and few in the world were not, in some way, affected by her personality and opinions and actions.
She might be described as we ordinary human brewers sometimes describe German brewers: We say they are often wrong but never uncertain. The baroness earned the sobriquet “Iron Lady” for her certain and forceful opinions and actions that alienated and hurt so many in Britain and around the world; they were in all sorts of different walks of life from coal miners to brewers.
I happen to care about people in both those walks of life: My family background is the coal mines of South Wales and my personal foreground is the brewing industry. Therefore, despite the glowing reports and reminiscences of Baroness Thatcher in these United States for “saving Britain,” I (and many others) consider her reign to have been an unmitigated disaster; if she saved Britain she saved it for the upper classes by shoving coal miners into the toilet, brewers into other professions and the British brewing industry into beggar-hood where it more or less remains today.
I think Baroness Thatcher learnt something about how to regulate the brewing industry from her friendship with President Ronald Reagan, a person, incidentally, who saved the USA in much the same way the baroness saved Britain; I suspect he taught her about the three-tier system of beer distribution that operates in this country. This system assures that brewers have very limited direct access to the retail market that is handled on their behalf by wholesalers.
In contrast, the original British system was one of tied houses; that is the brewers controlled the production and distribution and retailing of beers because they owned not only the breweries, but also the public houses in which beer was sold directly to the public. Over the centuries, really, the brewers accumulated many pubs and they became, to all intents and purposes, the only means of distribution and the only place of beer consumption.
There were a few free houses here and there owned privately by individual businessmen and women, but they were dependent upon the breweries for their supply of beer; of course (and I guess this is the point that stuck in the Reagan/Thatcher craw) the tied house system was cooperative or, in conservative speak, inherently non-competitive and certain breweries could and did dominate their local areas simply by owning enough of the pubs.
On the other hand, this gave every part of Britain its own brands and styles of beer in which the local populace took pride and gave them their characteristic neighborhood pubs where the community gathered to talk and relax; no one drank beer at home — bloody un-British and anti-social that.
Baroness Thatcher’s brilliant insight into the beer business was to separate the breweries from most of their pubs which, in short order, changed dramatically the nature of the business: Brewers closed and/or sold their breweries and kept their pubs, which now became centers of cash flow; supermarkets sold cheap imported beers and pubs started to morph into rather poor restaurants; the Pubcos leveraged the cash flow from their pubs for other purposes as businessmen will.
The decline of the British pub, hundreds of which close every year, is now well advanced and for that we can thank the baroness. Few ordinary folk in Britain will be sorry to see her go and I can hear the outraged protests in Britain about her expensive and elaborate state funeral from my back patio.
A year ago last December I attended, with about 700 other brewers from around the world, the 125th anniversary party of the Institute of Brewing and Distilling at the Guildhall in London. It was a grand show. The invited after-dinner speaker was a well-known TV and radio personality who happened, in an earlier time, to be a factotum in the conservative government during the Thatcher years. Instead of regaling us with his life and times on TV, he chose to extol the life and times of Baroness Thatcher.
He was greeted with stony silence. Come to think of it, that would also make a suitable goodbye for the baroness.
— Reach Michael Lewis at [email protected] Comment on this column at www.davisenterprise.com