The following is an excerpt from my personal beer research and a paper titled, "A Pint of Liberty." The work is still ongoing, but this excerpt is nearly a finished product. A few of these items are taken from historian Maureen Ogle's "Ambitious Brew: The Story of American Beer."
The multitude of German immigrants arriving in Milwaukee and Chicago during the late nineteenth and early twentieth century provided a monumental boost to the American beer culture. Phillip Best left Germany and arrived in Milwaukee in 1844 when only 7,000 people inhabited the city. Best opened Pabst brewery, which quickly appealed to the burgeoning German population. Within fifty years Pabst became one of the nation’s largest breweries alongside other German-immigrant owned breweries, such as Schlitz and Busch.
Germans had brewed beer since the middle-ages and they imported that beer culture to the United States. Best and an influx of Germans immigrating to Milwaukee discovered that Milwaukee’s climate and proximity to the cold waters of Lake Michigan allowed them to brew traditional German lager. Also, the Great Lakes provided access to hops farms near Buffalo. Unlike ales, lagers did not sour quickly, contained less alcohol, and tasted less bitter than ale, which most drinkers (at the time) enjoyed. Furthermore, Milwaukee’s cold climate allowed for cold storage as well as a long season with which to brew beer, allowing the endeavor to become economically viable.
Timing for a growing beer culture could not have been more perfect: The German guild system in Germany struggled after their 1871 creation of a German state at the same time Chicago’s economy and population grew substantially; Chicago’s population doubled for two straight decades, reaching one million inhabitants by 1890. As early as 1857, railroads connected Milwaukee and Chicago in addition to the increased availability of steamboats which allowed brewers to ship beer to Chicago and then to nearby saloons. Moreover, Milwaukee brewers expanded production to Chicago after the city’s 1871 fire burned down many of Chicago’s brewing plants.
Beer advertisements around the turn of the century dominated Chicago’s newspapers, ranging from breweries advertising their beer to engineers offering their services to brewers. In fact, “By 1890 Chicago had 34 breweries with 2,051 employees and payrolls of more than $1.4 million per year. Ten years later, in 1900, Chicago breweries produced over 100 million gallons of beer per year”, 74 percent of which were owned and operated by brewers of German origin.
Adolph Busch, along with many German brewers, felt that American barley proved insufficient for making lager, forcing him to experiment. Through this process, Busch discovered that Americans enjoyed a recipe akin to the Czech style (Bohemian) of beer, known as a Pilsner, which he discovered he could emulate by using rice instead of barely – an ingredient most modern craft brewers loathe and consider impure. Nevertheless, most early judgments of Busch’s new recipe, which he named Budweiser, provided favorable results. In fact, when Busch entered his Budweiser beer at a conference in Paris in 1878, the judges praised Busch’s beer for its purity and quality. Later, Busch enjoyed considerable success when he sold his beer at the 1893 Columbian Exposition (Chicago’s World Fair). Meanwhile, Pabst also enjoyed success with his similar style of beer and, although many questioned the honesty of the judging, Pabst beer won the “blue ribbon” award over Budweiser.
By the time of the World’s Fair, Chicago had grown to become a major economic center and railroad hub which, along with the invention of refrigeration, allowed brewers to vastly expand their marketplaces and change beer history in America for decades. Pabst and Busch used their World’s Fair success to market their beer, which exemplified the changes in the beer business by the turn of the century. As a result of the World’s Fair, Pabst named their beer, “Pabst Blue Ribbon Beer” in order to remind people of its champion status in Chicago. Meanwhile, Busch called his beer the “King of Beers," employing and idea provided by The Czechs, who referred to Pilsner as "The Beer of Kings," since it was brewed in Budejovice, the imperial brewery of the Holy Roman Empire.
Thus began the growth of "big-business" beer, which resulted in higher profits for brewers like Busch and Pabst, while smaller brewers began to fold -- a trend that continued until the 1980s.
For more, you can see my article that I wrote in January of 2015 for Sommbeer.com, titled "America's Second Attempt at Craft Brewing."