The History of the Liquor Industry in Chicago

Today when many people hear about Chicago, they think of the 1920s, mobsters, and bootlegged alcohol. However, the history of the liquor industry in Chicago is much more interesting and complex. For example, contrary to popular belief, bootlegging began before Prohibition and persisted afterwards as a way of avoiding high alcohol taxes. Without paying taxes, illicit alcohol was far less expensive than legal alcohol.
 
Chicago’s Liquor Industry Pre-Prohibition
 
The Midwest's agricultural trade, notably in grain and hops, made Chicago an obvious location for liquor manufacturing and distribution. 1827 marked the beginning of the retail liquor trade in Chicago. This was when Samuel Miller and Archibald Clybourne opened the Miller House, a shop that served as the town's first bar. The liquor business grew in tandem with Chicago's social growth, responding to both demand and moves to limit the manufacturing, sale, and use of liquor. By 1837 there were ten bars, 26 stores, several of which sold alcohol, and one brewery.

But this successful start did not mean the liquor industry always had smooth sailing. For example, due to a 1907 decree that permitted local precincts and wards to implement their own Prohibition laws, two-thirds of the city's saloons were forced to close. In addition, during World War I, grain conservation restrictions limited the manufacture of alcoholic drinks, while anti-German sentiment made beer consumption unpopular. While Prohibition was difficult for the liquor industry it was not the only challenge it was facing at the time.
 
Chicago’s Liquor Industry During Prohibition
 
As is well known with the start of the roaring 20’s came Prohibition. On January 16, 1920, the Eighteenth Amendment became law. The statute was enforced by 1,520 Federal Prohibition Agents. The measure made it illegal to make, import, or sell alcohol. However, it authorized the production of up to 200 gallons of wine or cider at home. The law also had religious and medical exemptions.
 
During this time, the illicit selling and smuggling of liquor became one of the most lucrative enterprises in the United States. Following the enactment of Prohibition brewery owners anxiously sought possible buyers for their enterprises. Some breweries, with the help of mobsters, continued to make alcohol illegally. Other breweries shifted to the manufacturing of nonalcoholic drinks or survived by selling the raw materials used in the manufacture of liquor instead.

Chicago’s Liquor Industry After Prohibition
 
By 1930, bootlegging had become astonishingly organized, thanks to mobsters who turned their operations into full-fledged criminal businesses. By 1930, there were over 10,000 speakeasies open. Furthermore, hundreds of establishments in Chicago that were supposed to close remained open even after Prohibition was repealed. There were also "blind pigs," or taverns and saloons with blank fronts that led to a side entrance with a peep hole. Some of these establishments may still be found on themed tours throughout Chicago today.

Following Prohibition, persistent mob links and forays into the Chicago market by larger national corporations crushed local alcohol manufacturers' hopes for a speedy economic recovery. A few major businesses dominated the distilling industry, and wine and beer manufactures were centralized as well. Wholesalers became the intermediary between manufacturers and sellers. The Chicago Beer Wholesalers Association had roughly 30 wholesalers in 1989, each with a contract to sell exclusively in certain areas. Wine and liquor distribution continued to become more concentrated in the 1980s and 1990s.

The Modern Cocktail Movement
 
Much of the 1920s era’s bootleg liquor was stomach-turning. To make the liquor palatable, drinkers and bartenders mixed in various ingredients that were flavored and often sweet. The need to make this liquor drinkable, and to provide buyers with a discreet place to drink it, created a phenomenon that lives on in today’s craft cocktail movement and faux speakeasies.

This experimentation was the beginning of the modern cocktail movement, and what a wild ride it has been. Your parents–and grandparents–may have once kept a copy of a cocktail recipe bible tucked next to their liquor bottles. Mr. Boston was popular, but there were others. They may have mixed martinis, Manhattans, margaritas, whiskey sours, French 75s, or any number of recipes now considered vintage, while listening to records and lounging in wood paneled rooms.

The classics were the status-quo of the modern cocktail movement until the 1980s brought a whole new breed of beverage to the table. Drinks we may enjoy ironically today were invented during this era, including the infamous pina colada, blue Hawaiian, grasshopper, amaretto sour, Long Island iced tea, and even the Singapore sling.

The next big advancement came about thanks, in part, to the food culture obsession of the late 2000s.  Foodies watched David Chang, Anthony Bourdain, and other chefs on TV, and cocktails soon entered the mix. If you were looking for great mixology in Chicago in 2010 you likely visited the now-shuttered River North restaurants Sable or Epic.  In 2012 you might have visited The Barrelhouse Flat, Scofflaw, or Elixir Lounge.

Next came secret speakeasy-style bars. Unlike Prohibition, this time everything is above-board. You’re not likely to be raided when visiting Chicago’s Milk Room (with only eight seats), The Drifter (with an entrance down a set of metal stairs and by a bathroom), The Office (below another cocktail bar called Aviary), or Dorian’s (through a tiny record shop storefront). You just have to be able to find them.

While it’s fun to go out on the town to sample the latest in liquor, not everybody wants to leave the comfort of their own home. Convenience options abound, too, such as pre-mixed cocktails and even frozen cocktails such as frozen whiskey highball pops, frozen margarita pops, and other specialty cocktails–many made by a company called Sliq, whose headquarters are in Chicago. If it were not for the determination of Chicago bars and speakeasies there would be many fewer cocktail options.

Today tavern culture shapes practically every one of Chicago's 77 neighborhoods (apart from the city's dry wards, where liquor licenses cannot be given). Chicago's bars serve as "third places" for community meetings, locations to cheer on the city's sports teams, and gathering spots for music enthusiasts before and after events.