Benjamen Walker's Theory of Everything - sudculture (part I of II)

Episode Date: June 6, 2016

Your host sets out to better understand America’s craft beer scene. The latest food trend? Or oppositional culture?  And can it survive the attention from Megabrew? image: http://www.beercapmaps.com  

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Episodes every other week at neverpo.st and wherever you find pods. This installment is called Sud Culture. One of my favorite things about American craft beer is that it truly is a national scene. It's kind of like how music used to work, before all bands got sucked into living in New York or Los Angeles. Almost every major city or region in the United States has its own craft beer scene. Sure, a lot of folks will single out San Diego as being the ultimate craft beer scene, but this is for a very bad reason. You see, last year, a craft brewery in San Diego called Ballast Point got bought by Constellation, one of the Megabrew conglomerates, for a billion dollars.

Yes, a billion dollars. We are going to start things off in San Diego, though, but not because of Ballast Point. We are going to start with Blue Moon. It's easy to drink. It's different. That's Evan Parent. He was born and raised in the San Diego area. He's a huge craft beer nerd, but he's not a beer snob.

If I'm at the river and I'm going to be drinking all day, I'm not going to be drinking 7-8% IPAs. I'm going to go grab some Bud Light and drink 12 of them. But one day, Evan ordered a Blue Moon at his local, and the bartender casually made a comment about Blue Moon's provenance. A provenance Evan was totally unaware of. Blue Moon is and always has been a Miller Coors product. My mind was blown because there's no mention of Coors on any of these things. The name of the product or the DBA that they have, the doing business ads,

is Blue Moon Brewing Company. They're trying to like disassociate that from the Miller name. So Evan launched a class action lawsuit. Miller Coors lawyers have already requested that the case be thrown out. No merit. But Evan's lawyered up as well. He got his good buddy Jim Treglio to take on the case. I'm Evan's attorney in the Bloomin' case. Now, Evan really wants to win this case, so he would only talk to me on the condition that Jim monitor-slash-interrupt our conversation. a law school class. But one of the causes of action was brought under California's unfair

competition law. Because Miller Coors isn't just deceiving consumers into purchasing one of their products for more money. What they're also doing is they're taking the shelf space from legitimate craft breweries. There's a problem with Jim and Evan's argument, though. There is no legal definition for craft beer. And while it might be reasonable to expect craft beer is beer produced in small batches, according to the Brewers Association guidelines, the closest thing the beer world has to actual legalese, you can brew six million barrels a year and still be a craft brewer. That crazy number comes from one of the

nation's first craft brewers, Boston Beer. They have a lot of clout in the industry, and they don't want to lose their craft beer cred. Today, they produce an annual 6 million barrels of Sam Adams beer. But if they produce more next year, then that Brewers Association guideline number will go up as well. In 2013, Blue Moon produced around 2 million barrels, so they totally qualify. Plus, as Evan mentioned, Miller Coors has created a shell company

for their craft beer brand. And I think it's really important to be clear here. Miller Coors is not breaking any laws to market Blue Moon as a craft beer. This is America. You can market your beer any way you like. In fact, the world's largest brewing company, Anheuser-Busch InBev, or AB InBev, is temporarily renaming their beer Budweiser America.

When it comes to marketing beer, these big companies are super crafty. I put Shock Top one inch above Blue Moon just because Shock Top has that annoying sort of Guy Fieri looking guy on the top. That's Bruce Ryan, and while we both share a hatred for Blue Moon, it's Shock Top that really drives him crazy. That AB InBev product is heavily marketed as an adventurous, iconoclastic craft beer. So we're at Schultz's Bar and Grill right now. But you won't find Shock Top or Blue Moon at Schultz's Bar and Grill right now. But you won't find Shock Top or Blue Moon at Schultz's,

a bar in Seattle's University District where Bruce is in charge of the taps. Being in Seattle, we always have two IPAs. Today we have Oakshire IPA, and then we also have one from Melvin Brewing. We're always on the search for a new IPA, something new and interesting out there. A couple of months ago, I had drinks with Bruce in New York. He's a high-level Radiotopia supporter. And when I told him about this beer series that I was working on, he invited me out to Seattle, where he lives.

Seattle is definitely a great place to start a podcast series on craft beer. We ran about 250 beers last year on our 12 taps. So no beer stays around here very long. But Bruce's style of beer curation is making the big breweries nervous. This is why they're making their own craft beer. And it's why they're doling out such large sums of money for famous craft brands like Ballast Point and Goose Island.

And it's why mega brewers like A.B. and Bev are doling out incentives to bars like Schultz's to stick to their kind of craft beer. So Goose Island IPA, which is a terrific IPA, is now an Anheuser-Busch product. And so Anheuser-Busch will come out periodically and offer it at a substantial discount, a substantial discount even to what Budweiser sells at on a keg price. So we'll buy a couple of kegs at that low price and take

advantage of it. Great. It's free money for us. But the United States Department of Justice is now investigating some of these incentives, especially the ones AB In Bev is offering. For example, distributors who work for ABN Bev, which is a lot of them, are incentivized to devote resources to selling ABN Bev beers. So if you own an independent craft brewery and your beer is distributed by one of these ABN Bev incentivized distributors, they are sort of getting paid to not distribute your beer. This potentially violates antitrust rules, hinders fair competition, and consumer choice. That key American value that the craft beer renaissance taps into.

Cheers, America, AB&Bev. To be honest, I could devote this entire series to stories about the shady, underhanded practices of big beer companies, especially AB&Bev. But I'm just way more interested in understanding what sort of subculture this craft beer scene has become and what it has to offer those of us who are in search of ways to fight and resist monoculture and mono beer. The genie is out of the bottle, the beer bottle. People are obsessed with beer in Boston, in New York. You live in New York, right? New York, San Francisco, Seattle, Oklahoma,

where I'm originally from. It just appears that everyone's got craft beer on their mind. That's Charles Finkel. He's one of the founding fathers of the Pacific Northwest craft beer scene. He and his wife started Pike Brewing in 1989. When we entered the market, we were number five. Now we have over 300 craft brewers.

Two or three open a day here in our state. I met up with Charles at his brew pub in Pike's market. Pike Brewing Company is a shrine to beer. It's a brewery. You notice ours is a vertical structure to take advantage of gravity. It's a brew pub. This is our main bar, handcrafted like our beer. And it's a museum. The bulk of all of our restaurant and our museum is antique brewery. But there's so much brewery. It's difficult to see where the brew pub ends and the museum begins. In the fertile crescent of what is now.

And as much as I enjoyed learning about the Romans and their methods, I was much happier when we sat down to try some beers. The beers that you're tasting right now are made according to the world's oldest pure food law called the Bavarian Reinheitsgebot, with only four ingredients. Malt, hops, water, and God is good. And that's yeast. By contrast, one of the most popular brands of light beer has 39 ingredients. And of those, corn syrup is a major ingredient, but so is plopeline, glycol, alginate.

So are all manner of different colorings, preservatives, additives, et al. If we focus on ingredients, then the Brewers Association guidelines can help us move towards an actual definition of craft beer. Flavor, they claim, must derive from traditional or innovative brewing ingredients and their fermentation. People have discovered mass-marketed brewers taste the way they taste because they've commodified flavor. And that's what the craft beer revolution is all about. Nothing more than flavor.

Charles had me try a number of his latest flavorful innovations. This is varietally named after the Copeland variety in a series that we call Pike Loche Ale. L-O-C-A-L-E. One word. He's much better with beer than he is with beer names. We work with Washington State University, who are breeding these heirloom variety barleys for flavor. The standard by which the big brewers regulate what barley varieties they can use,

flavor is not one of the criteria. It's incredible, but that's a fact. And so we work with Washington State University to develop barley that is flavorful. That's the whole concept is that it's flavorful. Other considerations, for example, yield per acre, disease resistant, those are important, but flavor is what we're all about. It's not like the big brewers want to make beer that isn't flavorful, but by definition, their number one concern is big, volume. So when companies like AB InBev or Constellation purchase a craft beer, they tweak the recipes and reconfigure the brewing processes

to mass produce it in their brewing facilities that are spread out, in some instances, all over the world. For Charles, that's crafty beer. I personally wouldn't purchase a product if I knew some company like that had it, no matter the merit of the product. And the reality is that they dumb it down as soon as they become associated with it. Charles is concerned that the billion dollars Constellation paid for Ballast Point

will lead to other craft beers also being dumbed down. Craft beer is hot. Ballast Point is a hot brand. Constellation apparently felt it was a good value. So they spent a billion dollars. But what does that do? That makes a lot of other brewers want to make a billion dollars. You know, you're successful enough. You can't fault someone for building up a business and selling it. That's the American way of life, for better or for worse. But what you can fault them for, a lot of people do fault them for, is when it is such a predatory company

that buys them, the so-called evil empire. But Charles Finkel will not be selling out to the evil empire. In fact, this past year, he and his wife extended ownership in Pike Brewing to a few key younger employees. My exit strategy is death. I have no problem with, you know, kind of plateauing as far as our growth is concerned.

And, you know, if we can't ever meet the demand for our product, that's kind of just the way it's going to go. At some point, I'd like to have a work-life balance again and not just live at this brewery 24-7. Steve Luke is the founder and head brewer of Cloudburst, which is now absolutely my favorite craft brewery in Seattle. We make beer kind of just on the whim that we feel like making. So we really don't ever make more than a couple batches of one particular style or recipe. And it's kind of ever ever rotating something's always new on tap craft drinkers they're they're adventurous they always are looking for what's new and that's kind of our model

is will we we are everything is new this move towards the experimental is the generational divide separating brewers like Steve Luke from brewers like Charles Finkel. It's not just small batch anymore. Now it's small, always different, always new batch. I mean, what I really wanted to do was kind of an extension of what my previous job at Elysian was, which was just, you know, an experimental brewer. I got to brew 250 plus different beers at my time there for, you know, over a four or five year period. When Steve left Seattle's Elysian Brewery, it had racked up millions in annual sales and an international reputation.

One of the reasons A.B. andv paid undisclosed millions for it. And while Steve's plans for his own independent brewery were already in motion when the deal closed in 2015, the new owners really tried to get him to stay. They certainly have such deep pockets and resources. And that was kind of how they tried to keep a lot of brewers on board, these huge two-year signing bonuses. But for Steve, it just wasn't about the money. It's about the heart and soul, which they don't have. You can't put a price on soul. You can't buy soul.

Independence is a very important value to Steve. It's also one of the guidelines the Brewers Association uses to define craft beer. Independence, they claim, means an outside entity owns no more than 25% of the operation. So following this logic, after Elysian sold to AB InBev, it ceased to be a craft beer. This is why, when AB InBev told Steve about their plans to roll out space dust, an IPA he created for Elysian, nationally. He was thrilled. Thrilled to be leaving. In my exit interview, a question was asked, if you didn't already have this plan in the works, if you weren't starting your own brewery,

would you still be here? And I looked them in the eye and said, I would already be gone by now. And they couldn't grasp why. Over the course of my visit to Cloudburst, I tried all the beers Steve had on tap. And they were all incredible. But it was this imperial stout brewed with coffee and hazelnut oil called Darkenflox, named for a George Saunders short story that really blew my mind.

Growing up in New England, you know, I drank a whole lot of Dunkin' Donuts hazelnut coffee in high school. I mean, that was the parking lot we hung out in after classes. And so this is kind of like your crappy hazelnut gas station coffee for grown-ups, and it's, you know, 9, 9-plus percent. Oh, it's great.

It's certainly, it's not a beer for everyone, and none of our beers are really meant for everyone. But that's a beer that seems to be getting a lot of, like, you know, wow. People really like some strongly flavored beers these days, and, you know, we can do it, but we also don't want to do it all the time. Perhaps craft beer is taking this whole big aggressive flavor thing too far. This is a ballast point model.

Let's squirt some grapefruit extract into this IPA that we already have and see if people like it. Oh, they liked it. Let's, like, get a bunch of other, like, fake extracts and just throw it in beers that we've already had. You know, whether it's blood orange Let's get a bunch of other fake extracts and just throw it in beers that we've already had. Whether it's blood orange or it's pineapple. That's not inventive.

Obviously, Steve Luke does not believe Ballast Point is a billion dollar beer. I mean, that number is just ridiculous. I don't think they'll ever make their money back on that deal. And like Charles Finkel, Steve Luke believes the Ballast Point sale is not good for craft beer. I'm leery of a lot of people kind of entering the market now just as like it's any other growth industry without much experience. Those people are really kind of looking at growth models. Cloudburst does have investors, but they aren't pushing for a sale or even for scale. We're on pace for about a thousand barrels of beer annually. You know, we're never going to

be the next big, big brewery because we don't, you know, you're here. We don't have the space to do that. Steve does make enough beer to send kegs out. You can find Cloudburst in a number of bars and restaurants in the Seattle area. But for now, he has no plans to do bottles or cans. He wants to avoid the problems that come with distribution. Incentives. Hey, Ola.

We don't package our beer because we have no interest in playing the shelf space game. But being able to make a beer and then sell it for $5, $6 a pint on site, that adds up. And we certainly wouldn't be able to exist in this location if we couldn't have a tasting room that sells full-size pints or growlers to go. It turns out that most of the states that have thriving craft beer scenes like Washington all have the same thing in common. They all allow brewers to sell beer on site. Customers can come purchase or fill growlers with the latest offerings, or they can belly up to the counter and order a pint. As for me, it's really only when I'm in a craft brew pub like Cloudburst or Pike's Pub that this whole craft beer as subculture even makes any sense. This is where companies like AB InBev are truly losing money.

And it's where beer lovers are coming together to avoid mono beer and monoculture. Or maybe it's where they're gathering to create a new one. More on that in part two of this series. But before we go, I want to tell you about the craziest beer that I drank in Seattle. It was a pale ale called Loser. My friend Bruce pointed it out to me at the supermarket, and I just had to try one. This is a beer Elysian created before their sale to AB&Bev. It was a collaboration they did with Seattle's indie music label, Sub Pop.

In fact, the bottles all say corporate beer still sucks. But Elysian is still producing this beer, even though it is now a genuine corporate beer. So I guess it gets the award for being the most craftiest of all craft beers. There's probably more I could say about that beer. But to be honest, it was just awful. You have been listening to Benjamin Walker's Theory of Everything. This installment is called Sad Culture. This episode was produced by myself, Benjamin Walker, with help from Cara Oller and Dasha Lizitsina.

Special thanks to everyone featured in the show, and extra special thanks to Zach Mack in New York and Bruce and Karen for taking care of me in Seattle. The Theory of Everything is a proud member of Radiotopia from PRX. Carrie and Julie and everyone else there makes it so much easier for all of this to happen. And thanks to the Knight Foundation, MailChimp, and listeners like you,

Radiotopia is only going to get bigger and better. You can find links to all of the podcasts in the family at radiotopia.fm. dot fm