History

PROHIBITION AND ITS IMPACT

From 1920 to 1934, Prohibition was the law of the land. Bathtub gin, “blind tiger” saloons, speakeasies, and boot-flask fashion accessories were colorful aspects of the times, but Prohibition’s true impact on American culture and society was anything but colorful.

In their rush to fabricate a social ideal, lawmakers and moralists had overlooked the devastating economic consequences that would result from their “noble experiment.”

PROHIBITION’S FAILURE

Not only did Prohibition fail to accomplish its primary purpose, but the social benefits that were supposed to result also failed to materialize. Crime rose, due in part to organized crime which increased its power and influence, particularly in the cities.

Hundreds of thousands of distillery workers, barkeepers, tavern owners, barrel-makers, and liquor salesmen saw their jobs disappear overnight. Over time, a host of related businesses suffered as well, like farmers, machinists who made and serviced distillery equipment, and railroads, steamships, and trucking companies that transported alcohol.

HARD TIMES FOR FARMERS


While Wall Street was flying high during the decade of the 1920s, America’s farm economy was already in depression. From 1920 to 1929, the value of American farmland dropped 30–40%, and from 1929 to 1932, farm prices fell 53%.

Loss of the distilling market was a particular blow to grain farmers.

DID YOU KNOW?

In the first year of Prohibition,
alcohol consumption
dropped 30%.
Over the next 11 years, however, consumption began climbing. By 1933, Americans were drinking nearly as much alcohol as they had before America went dry. Most of the alcohol was illegal.

REPEAL!

When Prohibition was repealed in 1933, the nation was deep in the nightmare of the Great Depression.

The forced shutdown of the alcohol industry was one in a series of blows that crippled the American economy during the 1920s and early 1930s. By 1933, one in every four American workers was out of a job, and the nation was tired of social experiments like Prohibition that had destroyed people’s livelihoods.

BLACK DAYS FOR INVESTORS

During the two-year span from 1930 to 1932, industrial stocks lost 80% of their value. Across the nation, banks failed at an alarming rate. From 1920 to 1929, roughly 600 banks failed every year, but between 1929 and 1932 alone, 10,000 failed, and over $2 billion in deposits were lost.

Not only had investors lost confidence in American business, they also had no money to invest. Steps taken by the Roosevelt administration to stabilize the nation’s economy had severely restricted investment funds.

The decade of the 1930s saw economic hard times for Americans in virtually all walks of life. Nation-wide, one in every four homeowners lost his home through mortgage default. The darkest years of the Depression were 1932 and 1933; the growing unemployment rate was one factor that encouraged repeal of Prohibition. The last year of double-digit unemployment was 1940, when the economic boom of the wartime economy officially ended the Depression.

HEAVEN HILL—BIRTH OF A FAMILY AFFAIR

While the popular “Happy Days Are Here Again” might have been sung to celebrate repeal of the Volstead Act in December, 1933, the Bourbon industry was in a shambles and most distilleries remained closed.

The Great Depression shook America’s confidence to the core. In that environment, the only investors who would dream of getting into distilling were ones who possessed a special kind of courage and a healthy dose of optimism that America could regain its economic vitality.

Did You Know?

Of the 183 distilleries that had operated in Kentucky prior to Prohibition, fewer than half reopened at repeal.

Despite enormous odds against success, in December, 1934, a group of investors in Bardstown came together to found the Old Heaven Hill Springs Distillery.

Some of the investors were men with experience in the distilling industry, but among them were five brothers—the Shapiras—who didn’t know a barrel from a box. However, the Shapiras were gifted with long-range vision and the drive to produce the very finest quality Bourbons.

In the midst of such bleak economic times, the brothers’ drive was essential. Investors in the Bourbon industry not only had to come up with the money required to purchase a distillery and get its machinery back into production, but they also had to buy all the raw ingredients to make whiskey, and the barrels and warehouse space in which to age it. And the cash drain wasn’t over yet. As soon as the first splash of whiskey hit the barrel, the Federal excise agent was on the spot, ready to collect the taxes. Even after all that cash flowed out, investors still had to wait several years for the whiskey to age before any cash would flow back into the company.

THE SHAPIRAS

Ed, Gary, George, David, and Mose Shapira had unshakable trust in each other. Each Sunday the brothers gathered at Gary’s home in Louisville. While their children played and their mother Annie and their wives saw to preparations for Sunday dinner, they talked over the past week’s business.

THE HOMELS

Harry Homel knew the Bourbon business. Shortly after the repeal of Prohibition, he and two other investors started the James B. Beam Distilling Company. But in the 1940s he sold his interest in that business to join Heaven Hill. The early years saw Harry traveling the length and breadth of America, signing up distributors one at a time and forging alliances that would carry Heaven Hill products throughout the nation.

THE BEAMS

Joining Heaven Hill in the early years as Master Distiller was Earl Beam, the great-great-grandson of Jacob Beam. As Master Distiller, Earl was the one who developed the original Heaven Hill mashbills from traditional recipes that had been passed down through his family. Earl added his expertise, along with generous portions of his special yeast. That yeast is still an essential ingredient today in all our Bourbons, like our Evan Williams and Elijah Craig brands.

The “noble experiment” had a devastating and long-term impact on the state’s economy and on the distilling industry.

FROM HEAVENHILL TO HEAVEN HILL

The land the investors selected for their new company lay just outside the city of Bardstown on several acres of gently rolling fields that had once belonged to William Heavenhill, a 19th century pioneer and distiller.

Did You Know?

The five Shapira brothers were sons of a Russian immigrant who came to America in the 1870s and worked as a peddler to support his family. Gradually, he saved enough money to found The Louisville Stores retail clothing outlets, which were later used by his sons as a springboard to create Heaven Hill.

According to some, William Heavenhill was born in the midst of a surprise Indian attack that forced his mother to flee their home on September 15, 1783. In the woods, underneath a waterfall where she was hiding, she gave birth to William, perhaps the first white child born in Kentucky.

For William Heavenhill, distilling was a family tradition. By some accounts, Heavenhill corn whiskey supplied Bardstown’s historic Talbott Tavern in the early 1800s. In fact, the same spring William used to make his Bourbon was the spring that inspired our company’s first name: The Old Heaven Hill Springs Distillery.

HOW HEAVEN HILL GOT ITS NAME

You’re probably going to think this is strange, but no one remembers for sure why Heaven Hill isn’t Heavenhill. Some say that a typist’s error on the company’s first distilling permit misspelled Heavenhill as two words, and the young company couldn’t afford the fee to re-file it.

Then again, there’s a story that when one of William Heavenhill’s granddaughters heard there would be a distilling company bearing her grandfather’s name, she was aggravated. As a teetotaler, she didn’t want her granddaddy’s name used on a liquor bottle! (Her granddad—the distiller—might have gotten a chuckle over that.)

THE BEAM DYNASTY OF DISTILLERS

In 1788, Maryland rye whiskey distiller Jacob Beam (originally Boehm) packed up his pot still, strapped a jug of yeast to his side, and set off for Kentucky. Here he started a distillery in Nelson County and began making Bourbon, using the special strain of yeast he had perfected several years before.

Jacob was very particular about this yeast. As a living organism, yeast is vulnerable to heat, so in summer, Jacob kept his jug in the creek where it stayed cool.

Jacob taught his son everything he knew about making fine Bourbon, and he taught his sons, and before you knew it, there were a lot of Beams working as Master Distillers in a lot of Kentucky distilleries. The dynasty of Beam distillers, and their artistry and skill, shaped and defined the Bourbon industry.

HEAVEN HILL’S MASTER DISTILLERS

A Master Distiller has to be skilled in a number of different areas. That was just as true the day we opened as it is today.

Part chemist, part agronomist, part master chef, the Master Distiller is ultimately responsible for every single facet of Bourbon production, from the moment grains arrive at the distillery until barrels are removed from the warehouse for bottling.

There wasn’t one square inch of Heaven Hill that Earl Beam didn’t know by heart, and there wasn’t one piece of equipment he hadn’t tinkered with, at one time or another, to make better Bourbon.

THE OLD HEAVEN HILL SPRINGS DISTILLERY

Old Heaven Hill DistilleryFriday, December 13, 1935, was lucky Friday the 13th for the founders of the Old Heaven Hill Springs Distillery. That’s the day—exactly one year after its opening—that the company rolled out its first barrel of new Bourbon. Capacity that day was a slim 18 barrels.

But it was a start.

By 1943, the Shapira brothers faced their first critical decision. The initial investors—all those folks who knew the distilling business—wanted to sell out. The Shapiras could either wait and see who their new investors would be, or they could throw caution to the wind and buy out their partners. Despite the fact that the nation was in the midst of war, the brothers had weathered the Great Depression and they were confident they could keep their business growing.

Now the Shapira brothers were officially whiskey men.