Prohibition casts a thin shadow

A century after booze ban began, alcohol industry thrives in state

Wednesday was hardly a joyous milestone in the world of beer, wine and liquor, but that didn’t stop them from raising a toast of half-priced cocktails at Eli’s Taven in Milford.

And why not? The 100th anniversary of the ratification of the 18th Amendment to the U.S. Constitution — better known as Prohibition, banning most alcoholic beverages — at least highlights the healthy state of the industry today.

So Kevin Fitzsimmons, general manager and partowner at Eli’s, featured happy hour prices on sidecars and old-fashioneds for the occasion. “Speakeasy drinks,” he called them.

“Hopefully history doesn’t repeat itself,” he said as he prepped for the after-work crowd.

No, it doesn’t repeat, but it does ebb and flow, like the fluid dynamics of a keg, a cask or the fifth of bourbon used to make those sidecars (mix with lemon). The spirits industry just had its eighth straight year of added market share, reaching 36.6 percent of the total alcoholic beverage market, according to the Washington, D.C.-based Distilled Spirits Council.

Distilled spirits sales rose 2.6 percent to 226 million cases, which means the better part of a case per adult.

The council had parties last month around the 85th anniversary of repeal, including one at the French ambassador’s residence. “We were thanking them for supplying us during the long, dark years,” said Frank Coleman, senior vice president at the council.

And in Connecticut lately, the alcoholic beverage trade has been in the news. Breweries, now numbering almost 90, along with wine and liquor tasting rooms, are trying to win state approval to sell more product over the counter — a measure the powerful package store association opposes.

Diageo North America said last week it will move its headquarters from Norwalk to lower Manhattan at the start of 2020. That will cost Connecticut 350 of the 600 local Diageo jobs as the company migrates to a denser field of marketing talent.

The good news — and there’s always some of that in the spirits business — is that Diageo will keep 250 people in Fairfield County, at a location yet to be determined.

“We are committed to continuing to operate in Connecticut. Our Fairfield County office will house a number of teams, including our innovation center of excellence,” said Deirdre Mahlan, president of Diageo North America, in w written statement. “We share the governor’s optimism for the future of the state and look forward to helping deliver on that vision.”

That’s the first highprofile loss for Gov. Ned Lamont, with at least a consolation prize. The center of excellence is, as one company official put it, “where all of the innovation liquids are designed.”

By rights, Connecticut should keep those testing labs because, back 100 years ago, we were one of only two states, along with Rhode Island, to outright reject Prohibition, with a 20-14 vote in the state Senate. (Apparently two senators were out tipping one up for the evening when it came time to vote.)

Diageo has as part of its roots a storied Connecticut spirits maker, Heublein, of Hartford. I was there on the sad day in 1995 when Heublein, then part of London-based Grand Metropolitan, closed its Smirnoff plant, idling 240 workers in the capital city.

Less than three years later, the newly formed Diageo moved hundreds of Heublein headquarters employees to Stamford. That period, the mid-90s, was a low point for distilled spirits, said David Ozgo, chief economist of the spirits council.

Heublein had made it through Prohibition on the strength of its A.1. steak sauce and other food products but couldn’t survive corporate consolidation. And while almost no one can recall Prohibition today, people in the industry don’t want it forgotten.

“There’s never been a constitutional amendment that put a whole industry out of business,” said Coleman, at the spirits council. “It’s a cautionary tale of good intentions run amok ... the bottom line is that it left us with way more crime, all kinds of bad alcohol, government tax revenue went through the floor.”

That last point is no small deal, then and now. An hour-long, 2012 documentary, “Prohibition: Connecticut Goes Dry,” produced and directed at CPTV by my friend Jennifer Boyd, shows how the dire need for tax revenues in the depth of the recession sped up repeal. (Disclosure: I’ve been in, and helped with, some of Boyd’s many documentaries.)

Boyd’s piece called Connecticut “the wettest state,” highlighting the boozefilled Roaring ’20s in Westport, with the likes of F. Scott Fitzgerald and his crowd. It makes clear that enforcement was weak at best.

Sounds like marijuana laws, today’s rapidly ending prohibition. Connecticut will soon in all likelihood join the ranks of recreational-legal states. As always, there’s talk of abuse and addiction, with the affected industries saying they’re doing their parts.

Legal pot won’t affect the sale of distilled spirits, according to the spirits council. The group released a report last week showing “spirits sales have not been negatively impacted in the three states that have had legalized recreational marijuana retail sales the longest.” Those are Colorado, Oregon and Washington.

In Norwalk, an entrepreneur is planning a distillery that will produce spirits made from seeds and flowers of hemp, a marijuana cousin. Now that’s a combo.

Prohibition itself started a year after ratification, giving the feds time to write rules and rich drinkers time to stock up. These days, it isn’t puritanical Protestants leading the temperance movement opposing looser alcohol laws.

“Public health advocates are much, much bigger players in the anti-alcohol movement,” said Ozgo, the spirits council economist. “They get tons of money from the federal government.”

And so the debate over laws continues. The industry says it’s working to cut down abuse and addiction. Fitzsimmons, serving anniversary speakeasy drinks at Eli’s Wednesday night, respects the history. He’s the son of a retired New York City IRS criminal investigator.

“Eliot Ness was his idol.”