Beer-For-Revenue?

The word "liquor" or the phrase "intoxicating liquor" shall be construed to include alcohol, brandy, whiskey, rum, gin, beer, ale, porter and wine and in addition thereto any spirituous, vinous, malt or fermented liquor, liquids and compounds, whether medicated, proprietary, patented or not and by whatever name called containing one-half of 1 per centum or more of alcohol by volume which are fit for use for beverage purposes.

Between U. S. throats and legal beer stands this definition in the first chapter of the Volstead Act. By a majority Congress can at will modify this sentence so as to eliminate the word "beer" and up the alcoholic content to 2.75% or more. If, how and when such modification is to occur continued to make much frothy news last week. Behind all the heady hopes and thirsty speculation lay the following sober facts:

Legislation. Election results plus a mounting Federal deficit have given a great impetus to the beer-for-revenue drive. An attempt to modify the Volstead Act will be made early in the coming short session of the 72nd Congress. Heretofore the highest Wet vote in the House has been 187. Wets claim, however, that enough Dry members were "converted" during the campaign to produce 237 votes, a majority of 19. after Dec. 5. Never more than 26 sitting Senators have voted Wet. But here again sufficient conversions are claimed to produce the 49 majority. Senate Drys who have lately swung to Repeal if not to beer include Arkansas' Robinson, Mississippi's Harrison, Ohio's Fess, Georgia's George, Arizona's Ashurst, Washington's Dill, Michigan's Vandenberg, Tennessee's McKellar. Republican Floor Leader Watson last week declared he was for 2.75% beer because "it doesn't mean anything--it's only slop."

The beer-for-revenue outlook is better in the House than in the Senate where such Dry die-hards as Texas' Sheppard and Idaho's Borah can blockade action by talk. House Democrats who have announced their readiness to promote a quick beer vote include Majority Leader Rainey, Chairmen Collier of Ways & Means, Byrns of Appropriations, Pou of Rules.

Prime statistic: $6 per bbl. tax on beer is still part of the U. S. Internal Revenue law. On an estimated annual consumption of 50,000,000 bbl. (the U. S. drank 61,000,000 before 1919) the Treasury would collect $300,000,000.

But if the short session votes beer, would President Hoover approve? Most indications last week were that he would not. He has repeatedly held that to authorize that which the 18th Amendment prohibits is nullification. With him the result would hinge on the moral question of whether beer is intoxicating in fact. Another Hoover objection to beer is his fear that its production prior to controlled repeal of the 18th Amendment would bring back the saloon.

Production. Before Prohibition, 1,100 breweries operated in the U. S. Today 164 are still legally in existence under Federal permits for the production of near-beer. As near-beer is only real beer de-alcoholized, most of these breweries are ready to turn out real beer five minutes after the Volstead Act is modified. On hand under bond are less than a million barrels of beer which would last the nation less than a week.

The prospect of modification has caused a frenzy of excitement among brewers, ex-brewers and would-be brewers There has been tall talk of hundreds of millions to be spent on expanding and modernizing present equipment. While wise-acres discounted predictions that beer would put a million jobless to work, there was no denying the fillip it would give to allied industries.

Illinois issued charters to a dozen new Chicago breweries bearing such names as Citizens, Eagle, Old Style Lager, Fortune. Chicago's Bohemian-born Mayor Cermak, through a friend, closed a deal for U. s' rights to the product of Pilsen.

In St. Louis horsy young August A. Busch Jr., general manager of Anheuser-Busch, prepared for a directors' meeting at which manufacturing plans would be completed.

In New York City Col. Jacob Ruppert, whose Third Avenue plant has been kept spic & span through twelve Dry years, was "ready to produce the real stuff on a moment's notice." Other metropolitan breweries--Doelger, Lion, Schaefer, Loewer, Trommer, Piel--began overhauling their plants. Fidelio Brewery advertised its stock for sale with the observation: "Modification of the Volstead Act now seems assured." Conservative Wall Street brokers warned customers that good brewery stock was closely held, that the new issues were highly speculative. At the U. S. Brewers' Academy 22 grown men were attending classes of a technical course which would qualify them as master brewers next spring.

In New Jersey Representative Oscar Auf der Heide of West New York was elected president of $1,235,000 Elizabeth Brewing Corp. A successor to the old Peter Breidt brewery, Congressman Auf der Heide's concern has a real beer capacity of 200,000 bbl. per year.

For the first time since Prohibition the U. S. flag flew over the Beverwyck brewery in Albany.

Brewer Frank Schwab, onetime Mayor of Buffalo, was dismayed at his colleagues' zeal to flood the market. Said he: "Beer won't last five years if the saloon is allowed to come back."

Though wine was much more remote than beer, California vintners were also stirred with new hope. In that State before Prohibition were 770 wineries, of which 166 are still in operation under Federal license. Under bond are some 18,000,000 gal. of wine waiting for legal floodgates to open. The first mouquin wine catalog since 1918 was issued last week in Manhattan. The firm announced that it would have a ship loaded with a million dollars worth of wine ready to sail into New York and unload an hour after sales became legal.

Delaware charters for manufacturing "beverages" were granted last week to John Walker & Sons, James Buchanan & Co., John Haig & Co., Haig & Haig, Ltd.

Distribution. If & when beer returns it will no longer be "The Biggest & Coolest in Town, 5-c-." Taxes, Federal, state, local, will probably run its price above 20c per glass. But will beer-by-the-glass return? Few brewers were sure. The distribution problem still offers the greatest conflict of public and private opinion. As deep-rooted as ever is dread of the saloon. Crusader Fred Clark holds firmly to his organization's purpose of "taking profit out of liquor distribution." Such an able Wet as Representative-elect Wadsworth of New York fears that Repeal, the ultimate goal, might be retarded by a reckless flood of beer.

Quick modification by Congress would throw the beer control problem back upon the states, few of which are ready to deal with it. When in 1920 New York passed an enforcement act, it repealed its excise laws for liquor regulation. When in 1923 it repealed the same act, its statutes were left bare of authority to cope with the saloon. In many a state last week governors announced they would not tinker their local laws--or lack of them--until the 18th Amendment was repealed.

Suggested methods of beer distribution: house-to-house delivery by brewers; bottled sales at grocery stores; glass service at restaurants. Last week in Manhattan the United Restaurant Owners Association was told that cafeterias would soon replace the old-fashioned bar.

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