Where Did America's Single Use Barrel Rule Come From?

Transcript

If you’ve missed Whiskey Lore Stories, hang with me at the end of today’s episode for an update on how the show will progress into the future. And if you’re feeling hungry for a big dose of Whiskey Lore storytelling, check out my new audiobook The Lost History of Tennessee. It’s like 30 Whiskey Lore episodes all in one. Find it on Spotify and Apple Books or head to whiskey-lore.com/audio for a comprehensive list of links or to find the paperback. That’s the Lost History of Tennessee Whiskey. And now, enjoy an extended retelling of one of the stories in the book.

It was a cool spring morning, in 1823, when Colonel Crockett found himself settled in a bunk aboard a flatboat heading down the Obion River. The destination planned for he and his mates was the developing town of Memphis, where they were about to deliver a load of freshly cut wood staves for the coopering market that was beginning to form in that town. 

Davy’s wife Elizabeth wasn’t too excited about the frontiersman’s latest harebrained idea. He had just lost 3 grand when his distillery and mills were destroyed back in Lawrence County, leaving creditors none too pleased with him. He decided to move out west, and left his seat in the Tennessee General Assembly to hunt bears out west. That was bad enough for Elizabeth, but now he was talking his new neighbor’s into getting into the stave making business. It wasn’t so much the business itself that bothered her. It was the dangerous journeys he would have to take, heading down the Obion River to the mighty Mississip. She’d heard many a tale about the perils present where those to bodies of water rushed together. But Davy promised her, he would be sensible and take the greatest precautions. 

When the wood was collected and the weather cleared, his mates said their goodbyes to their wives and children, brushing back tears and praying for safe passage. Then they stepped on the homemade flatboat, loaded down with 30,000 barrel staves, and made their way down the peaceful river.

As day turned to night, the men on the boat grew comfortable with the gentleness of Obion’s placid waters. But nighttime could bring dangers, so Davy took first watch and let his mates grab some shuteye. 

In the morning, his half awake crew came on deck and a bleary eyed Crockett assured them all had gone to plan. They had a couple of hours before they’d reach the great river, so Davy decided to catch a quick nap before the day’s cooper negotiations in Memphis. He left his second in command in charge, opened the cabin hatch, stepped down the ladder, shed down to his long johns and crawled into his cot.

Sleep came quick and easy. And not only to Davy, but to his friends on the deck.

Suddenly, the watchmen were jostled awake by a sudden thud and cracking noise. As their eyes flew open and their adrenaline pumped, they saw a huge tree, whose roots had been worked loose by the undercurrent, ready to crash down upon the boat. They were just at the point of joining the Mississippi and the current was pulling the boat in circles and the roots of the dislodged trees, or sawyers as the old timers called them, were using their roots to entrap the boat. 

Old Hen Island was no more than 200 yards away, but the boat was now locked on the roots below. Then the sawyer crashed down hard on the deck and split the boat in two, sending barrel staves sprawling in every direction.

Below deck, Davy was in a deep sleep, when all of a sudden, in the middle of a snore, his mouth suddenly was filled with water. Coughing and clearing the water from his lungs, he realized the peril he was in. He quickly scaled the ladder and pushed up the hatch, just as a huge wave of water came toward him. He escaped just in time.  He and the men clung onto what remained of their flatboat, as the townspeople came out to the bluffs to see what the ruckus was about. 

A rescue team was organized and within a couple of hours, everyone was safely on shore, cold and wet, but greatly relieved. All, except for Davy. Who, in the excitement of the moment had forgotten to secure his britches. There he sat on the shore, with the entire town gawking at the scene, and him with no trousers.

It was a day those in Memphis would never forget. Later that night, Davy was in a tavern relaxing with one of the town’s founders James Winchester. The setting and mood was very different. Davy was now decked out in a fine suit of clothing and the scene was quite relaxed, with the two enjoying drinks. Davy charmed his host by spinning out fantastic tales and anecdotes all night. Winchester was so taken by the intelligence and good nature of his guest, he suggested, then insisted that the former state representative run for the U.S. Congress. It was a moment that changed Davy’s life. No longer would he be a frightful burden to his wife. Old Hen Island and James Winchester had shown him the light. Next stop, the House of Representatives in Washington, D.C. He left his rifle at home, but made quite the impression as he took his seat donning his coonskin cap. The legend of Davy Crockett was born.

While Elizabeth was likely pleased with her husband’s change in career focus, his original ambition of getting into the stave business might not have been such a crazy idea after all. In the 19th century, Tennessee would become a leader in the barrel making business and Memphis would become its center. And it was an industry that thrived and served Memphians right up to the edge of Prohibition. But when the 18th Amendment took away the need for water-tight cooperage, the industry was hard hit. 

Well, take a tour of a distillery in Scotland or Ireland today and you’re likely to hear a story that surrounds these events. The subject comes up when they are explaining why so many Scotch and Irish whiskies are aged in ex-Bourbon barrels. They suggest that after Prohibition, a mighty cooper’s union in America fought to get the law changed, so that Bourbon whiskey producers could only use freshly charred American oak barrels one time. It’s reasoned that they did this to preserve jobs in the cooper industry after so many coopers were unemployed during the whiskey and beer drought. In the end, it not only benefited American distillers - it created an excess of single use barrels that were immediately shipped over to the Scots and Irish for aging their single malts, blends, and pot still whiskies.

It’s a great story. Yet, if you visit an American distillery, you won’t hear a single one telling this story. What gives? Is the story true?  Well, before we find out, let's head back to Tennessee, and learn a little bit about barrel making and how the Volunteer state grew to become the go to place for America’s coopering industry. 

The Forgotten Industry

To understand coopers and how important their work was to 19th century distillers and merchants, we first need to learn a bit about different types of barrels and what they were used for.

There were three main types of barrels crafted by coopers in that era: dry or slack cooperage, dry-tight cooperage, and wet-tight cooperage. The easiest barrel to make was dry cooperage. This barrel was used in storing and transporting everything from fruits and vegetables to tobacco, nails and different types of tools.

The second type of barrel was dry-tight cooperage. This required a bit more skill to build, but it didn’t have to be water-tight. Its basic purpose was to reduce the amount of air that hit the products it stored. These types of barrels were used to store flour, gunpowder, pickled foods, and dried fish. Lore suggests that coopers used to char barrels to get the smell of fish out of them so they could be reused for whiskey. Even if you could burn that smell out, the reality is, a barrel made to store fish was not the proper vessel for storing liquid.

That barrel was known as wet-tight cooperage. Referred to in the early 19th century as beer barrels in America, these water-tight vessels not only stored whiskey, they also stored These sturdy watertight barrels took the most skilled coopers to produce and they not only stored beer and whiskey, they also stored oil, milk, and drinking water. Over time, as transportation improved and other materials like glass and metal became available for shipping, the coopers became more and more dependent on the alcohol industry for its services. 

In the early days of American distilling, barrels were usually kept clean and sanitized. In those days, distillers were careful not to taint their whiskies with any foreign flavors or colors. In the early 19th century, Kentucky and Pennsylvania distillers began requesting charred barrels, giving the coopers another skill to keep at the ready. But not everyone saw the charring of barrels as beneficial. Many Tennessee distillers felt sending their whisky through maple charcoal was enough to purify the spirit, so right up into the late 19th century, it wasn’t unusual for Tennessee distillers to request uncharred barrels to age their spirits. It was their belief that an uncharred barrel could still help in oxidation and flavor enhancement without adding color - a style many Tennesseans demanded.

Thus having a state filled with coopers was a distinct advantage. And it's an industry that sprung up not long after Davy Crockett's boat created quite a scene with its payload of thirty thousand barrels staves scattered on the waters of the Mississippi. 

But Memphis wasn’t the first home of barrel making in the state. That honor came to a little community north of Nashville. In the mid-1850s, a little distilling boomtown was developing around the town of Springfield and its whisky gained fame as Old Robertson. A few miles to the west of Springfield, a small community of skilled coopers developed and saw mills popped up all along the Red River to feed those distillers. The area grew so thick with barrel makers, the place became known as Coopertown. 

It didn’t hurt that Coopertown was within a few miles of the state’s largest distilling region, but what really set it off was the train depots in nearby Montgomery County and Springfield. With distillers like Wiley Woodard and Wilson Pitt sending barrels of whisky on rails deep into the south and transportation opening up to Louisville, west to Memphis, and down as far as Charleston, South Carolina, business exploded. By the 1880s, estimates showed that at least 125,000 barrels came out of Coopertown every year. 

And other areas around the state thrived as well. While the Nashville Cooperage Company saw its success shipping along the L&N Railroad, Chattanooga Cooperage Company shipped to points as far away as the Minneapolis flour mills, the Liverpool docks in the UK, and all across the southern United States. By the first decade of the 1900s, the Chattanooga based company had three sawmills and still couldn’t keep up with demand, part of which was then coming from the burgeoning Chattanooga distilling industry.

But when it came to barrel making in the late 19th century, Memphis was the king. The Memphis Cooperage and Manufacturing Company was one of its earliest successes, taking off just after the Civil War. Memphis became home to some of the largest barrel-stave factories in the country. In total, there were nine plants in the city by 1908, employing several thousand people between them. 

It was that year that the barrel industry bumped into a major problem. Demand was so high, supplies of white oak, red gum, and cypress trees were running short. The United States had become a nation of consumers and saws and axes had fed the need, but without reforesting plans, the wood supply was growing thin. As barrel prices rose, manufacturers turned to other types of materials like glass and metal for their transportation needs. The oil industry had trimmed its need for barrels by producing oil pipelines for transportation. More and more coopers leaned on brewers and distillers for their source of income. 

Then, the inevitable happened. Prohibitionists first took control of state legislatures and eventually achieved National Prohibition. Losing whisky, wine, and beer hit Tennessee, Missouri, and Arkansas the hardest. For tight coopers, layoffs became the norm in the 1910s as the South went dry. Then, a large number of cooperages shuttered their doors with the signing of the Volstead Act.

It was a tough 13 year slog. But when the wets took control of Congress in 1933, there was a genuine sense among the leaders in the cooper industry that something big was on the horizon. 

The industry’s mouthpiece at the time was the Associated Cooperage Industries of America (ACIA), a trade organization centered in Memphis. In the summer of ’33, its president, a local cooperage owner, Guy I. Frazier, wanted to get the industry off to a flying start after repeal. During the organization’s annual meeting, he looked to increase the output of American barrels to England and Scotland, and prepared to get coopers hired and back to work. 

But Frazier also had some concerns about what he was hearing out of Washington, DC. Beer and wine, not whisky, would be the first spirits allowed back after repeal. And there was talk that the beer bill that was being drafted might restrict the shipping of beer and wine to glass and metal containers. Frazier, a go-getter, sent a petition to Rep Thomas H. Cullen of Brooklyn, one of the writers of the bill, asking that the cooper industry’s concerns be placed in the public record. As repeal and the beer bill made their way through Congress, coopers held their breath. 

Caught with Their Pants Down

While the repeal of the 18th Amendment was achieved much faster than the battle that brought it about, it still took a couple of years for the 21st Amendment and repeal to become a reality. This gave the proactive cooper industry plenty of time to lobby for barrel usage. It also gave architects in Milwaukee, plenty of time to think about how to replace the old concept of the saloon with the modern, female friendly barroom. And some in the whiskey industry were prepared as well…especially Seton Porter, the head of National Distillers, who purchased warehouse after warehouse of whiskey stocks in Kentucky, Pennsylvania, and Maryland, in anticipation of eventual repeal. He had some 4,773,800 gallons of whisky ready to go when the time came.   

The government, on the other hand, appeared to be clueless. President Roosevelt, who had predicted repeal by Christmas 1933, had done nothing to prepare for its eventual arrival. When Utah became the thirty-sixth state to ratify the 21st Amendment, the U.S. Congress and the president had no plan or legislation set for legally managing and taxing alcohol. This oversight led to a comedy of errors brought on by a band aid solution created by the president. 

With Congress out on recess, the president did the only thing within his power. He created an executive order under the authority of the NIRA or the National Industrial Recovery Act. Congress created the act to regulate prices and wages, and to help foster competition and create public works projects. It also gave Roosevelt the unprecedented power to legislate from the White House. With this power, he set up rules and divided the liquor industry into six branches: Distillers, Rectifiers, Brewers, Importers, Wholesalers, and Vintners. It was Roosevelt’s hope that with a set of rules focusing on fair trade practices, each branch could police itself. 

He also legislated a prohibition on any connection between the manufacturer, importer, wholesaler of liquor, or retail operation where liquor was sold or consumed. This was the origin of the modern three-tier system that makes some whiskies impossible to find in certain states. Its purpose was to stop the pre-Prohibition practice of having breweries like Pabst, Busch, Miller, Schlitz and others from owning bars. It was Roosevelt’s belief that it was the direct funding of the saloons that led to most of the problems in the past. Unfortunately, the bill targeting brewers' bad habits punished distillers and whisky consumers who rarely took part in this strategy.

To manage his new laws, Roosevelt created a new government agency called the Federal Alcohol Control Administration (FACA). Its primary job was to issue permits under each branch’s codes, giving it ultimate control over the establishment of any liquor, beer, or wine entity. While it covered the importation and distribution ends of the business, it left retail regulations up to the states.  

As for taxation, that was to be handled by the Treasury Department with prosecutions handled by the Department of Justice. 

When the law went into effect, Washington and Roosevelt were taken by surprise by the massive rush of capital going into redeveloping the liquor industry. In the days before Prohibition, the country had only sixty importing houses. In the first six months after repeal, there were nearly two thousand. Where before Prohibition there were one thousand wholesale dealers, after Prohibition there were twenty thousand. It ballooned so fast, the government couldn’t keep up and many establishments just folded. 

In a flashback to Davy Crockett’s barrel staving days, FDR’s government was caught with its pants down.

Fighting Back

The wholesalers weren’t the only ones frustrated with Washington. In Memphis, Dr. Gus Dyer of Vanderbilt University stood up to address 150 ACIA attendees at the groups annual and lobbed angry words in the direction of Washington, D.C. Just as Guy Frazier had feared, the government was about to put coopers out of business. But it wasn’t the Cullin-Harrison beer bill that was causing the turmoil. It was a rule created by the U. S. Treasury Department under Roosevelt’s FACA. Standing at the podium in a banquet room in the Peabody Hotel, Dyer told attendees they’d better get their act together and stop the madness. He said, “It is almost unbelievable that the government should knowingly destroy one business to open the way for another.”

You see, the treasury department had decided the best way to stop post-Prohibition bootleggers was to forbid the use of bulk containers in the distribution and sale of liquors. This meant shipping in a barrel was off-limits. 

To top it off, they were bringing back bad practices by allowing artificial color to be added to whisky, taking the emphasis away from aging in wooden barrels. Dyer pointed out, “It is universally accepted… aging liquors in wood adds quality, that in the process of aging a certain color results and that the consumer has been trained to recognize age by color. The government is now permitting artificial coloring to go into bottles and doesn’t require the merchant to brand the fact. Why, this is contrary to the whole theory of the pure food laws.” It’s true. Just a glance at whisky ads from 1934 shows brands had to reassure customers “No artificial color added.” 

But color and quality were the least of the industry’s worries. This new ruling put an end to the brief boom in barrel demand. Two months after Dyer’s speech in Memphis, three quarters of the stave mills in Arkansas and Missouri had to shut down. 

The ACIA questioned the motives of the Treasury Department. They wanted to know, was the use of glass and metal containers really a deterrent to bootlegging? T.L. Gankel, the Executive Secretary of the ACIA didn’t believe it was. He wrote a letter to the editor of the Springfield Daily News saying the country had “13 years of proof that you can’t legislate the bootlegger out of business. The only way to drive him out is good quality liquor at a low price.” 

But nothing the coopers said seemed to make a dent in the law. In their minds, their lobby just wasn’t strong enough to beat back the glass and metal lobby.

But then, out of left field, came a disrupter that turned these industries on their head. 

In June 1935, the U.S. Supreme Court struck down the NIRA, declaring it unconstitutional. The reason given was that it gave the President and Executive Branch the power to legislate, breaking down the clear divisions of government. And the FACA was an example of its overreach. The high court’s decision threw the liquor industry back into uncertainty. With the FACA dead, the President turned to Congress. 

As legislators debated bills through the summer of 1935, signs pointed toward the cooper’s getting their way, through the reintroduction of the barrel in bulk liquor sales and transportation. But then Congress pulled that bill and instead created a new department called the Federal Alcohol Administration (FAA). They placed the agency under the control of the Treasury Department, and once again, the decision on bulk sales was up in the air and the new head of the agency, New York judge Franklin C. Hoyt seems opposed to it. 

But Hoyt wasn’t the man for the job. Within weeks, he began bellyaching that Congress wasn’t going to give him any money. Then the industry began fighting him at every turn. Development of regulations slowed, whisky quality suffered, and, without the ability to ship in bulk, demand for barrels stayed low.

Frustrated, Hoyt wrote a resignation letter and left Roosevelt in a fix. The judge claimed he was leaving for health reasons, but everyone knew he was sick of the job. Within days, Roosevelt picked Assistant Secretary of the Treasury Josephine Roche to hold the post for thirty days until someone could be permanently appointed.

Being this was a temporary job, one might think Josephine was only there to keep the seat warm until someone new was appointed. But while shuffling through the paper’s in Hoyt’s files, she came upon something interesting. 

It was a whiskey regulation that dealt with something whisky makers had been arguing over endlessly for decades - the term “straight whisky?” For 40 years, words like pure whisky and straight whisky were being used to market spirits with no true definition. This led to battles between wholesalers, rectifiers, and distillers that made their way up to the halls of the U.S. Capitol and the White House. For the first ten years of the fight, rectifiers found themselves on the losing end of two separate bills, the one leading to the Bottled-in-Bond Act and the other that encompassed the Pure Food and Drug Act. But when angry voices continued between the two factions, the wholesalers and rectifiers gained a win, when President William Howard Taft threw in his 2 cents worth. 

The Taft Decision of 1909 stated that neutral grain spirits could be called whiskey but they required additional wording on the label to define if they were compounded or blended whiskies. But what Taft wouldn’t do was define the meaning of the term straight, because, as he said, everyone instinctively knew what it meant. As another toss in statement, he also made the point that just because something was aged or had no color, these were not determining factors in what could be called whisky. But Judge Hoyt felt that age and color did enhance a whisky and he wanted to give consumers clearer guidance on what they were buying. Josephine agreed. 

But the industry was dead set against it. To them, creating an aging law at a time when distillers were just caught up after Prohibition, was the wrong move. They were all sitting on too much young whiskey to take advantage of it.  But Josephine saw its long term benefits and ignored the noise. On January 22, 1936, two weeks after taking the post, she codified the rules that every American bottle of whiskey adorning the word straight lives by today. 

To be called “straight,” they must be aged for two years, including rye, Bourbon, wheat, malt, and rye malt whiskies. There would be an exception for corn whiskies that weren’t required to be aged in charred oak barrels. As for the meaning of the word “age” she defined that as the period during which the whisky has been kept in new charred oak containers, except in the case of corn whisky.

The powerful effect of the word’s new charred oak barrel on the cooperindustry can’t be understated. 

What is crazy about the whole affair is that after all of their lobbying and fighting both Congress and the treasury over the preferential treatment of the glass and metal industries, a single “can-do” administrator who saw a regulation that was good for the industry made a decision that would secure the cooper industry well into the future.

And for all of the industry’s lobbying against the law, American distillers embraced the new single-use barrel concept, and soon, American consumers grew a taste for the vanillin and caramelized notes given off by the freshly charred new oak barrels. Scotch and eventually Irish distillers would grow to appreciate the rule as well, because it meant a huge market for single-use barrels and at lower prices because of the wide availability.

As for the coopers, dumb luck had snuck in and solved all of their problems. Well, not all of their problems. At the next annual meeting of the ACIA, just like in the days before Prohibition, coopers began to raise concerns of a shortage of white oak, as the brewing and liquor industries emerged from their cocoon.

I’m Drew Hannush and this is Whiskey Lore

Whiskey Lore is a production of Travel Fuels Life LLC

Production, stories, and research by Drew Hannush

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