Guinness Stout: From English to Corporate Colonialism
Dé hAoine Iúil 18, 2003 13:38 by Sean Dunne
I submitted this article to Z Magazine awhile ago, hoping to get it into the March edition. The assault on Iraq changed priorities, so it was moved back to the July/August issue. http://www.zmag.org/ZMagSite/curTOC.htm
I'm sure most of you know this story already, and there's also a lot more to be told. Thought I'd share this anyway, and if you aren't familiar with Z Magazine, I'd recommend checking it out. -Sean
EXTRACT: The effects of the Diageo ownership became clear in July, 2000, when Guinness announced plans to close the brewing and packaging plants in Dundalk, located just north of Dublin. The move came as a shock to workers and the community of Dundalk. This was the first Guinness plant closing ever to occur in Ireland. The closing eliminated over 300 jobs in a small community, as management justified the move as part of plan to remain globally competitive.
GUINNESS STOUT: FROM ENGLISH TO CORPORATE COLONIALISM
On March 17, 1737, Boston became the first city in the world to celebrate St. Patrick’s Day. Since that first celebration, the holiday has grown in popularity throughout the world. There are many activities and customs associated with the day, each designed to celebrate Irish culture. Parades are organized in cities all over the world, ever since New York City held what was considered the first St. Patrick’s Day parade, when Irish regiments in the British Army paraded through the streets in 1762. Irish food, such as corned beef and cabbage, is bravely eaten by people in all parts of the world. Irish dances, sports, literature, and music are also very important aspects of St. Patrick’s Day.
Many people will decide to spend some, or all, of their St. Patrick’s Day celebrations enjoying the atmosphere of an Irish pub. And it is usually in pubs when people make the most misguided of decisions during the festivities of St. Patrick’s Day. That is because, in Irish pubs, many people across the world will drink a pint of Guinness Stout to celebrate Irish culture.
Drinking Guinness does not connect one to Irish culture, because Guinness is not Irish. From the original brewer, Arthur Guinness, to the current owner, the Diageo Corporate group, to the policies that have affected the workforce, it is quite clear that Guinness is not, nor has it ever been, Irish.
Arthur Guinness was born in 1725, and was the son of Richard Guinness and Elizabeth Read. Richard was a Protestant land steward in Celbridge, County Kildare, and was employed by Arthur Price, the Archbishop of Cashel. The Archbishop was Arthur’s godfather, and also the man that Arthur Guinness was named after. One of Richard’s duties was the supervision of the brewing of beer for workers on the estate. It was here that Arthur Guinness developed his skill in the brewing trade, and by 1755 he was already being identified as “Arthur Guinness of Leixlip, County Dublin, brewer.” When Arthur Price passed away in 1752, he left Richard Guinness and his godson Arthur £100 each. Therefore, it was Arthur’s privileged social position, as part of the wealthy Protestant minority, which granted him the opportunity to become a brewer.
After receiving vocational training in brewing, and a substantial sum of money, Arthur Guinness signed a lease for a small brewery in Leixlip, County Dublin, dated from 29 September, 1756 when he was 31 years of age. Arthur began his career in the industry by only first brewing beer, or ale. The brewery prospered and it provided Arthur with the financial capability to purchase the St. James’s Gate Brewery in Dublin. On 1 December 1759, Arthur Guinness entered his signature in the Minute Book of the Brewers and Maltsters Corporation, to acknowledge his lease of the property at St. James’s Gate, Dublin. Information provided by Guinness and other popular literature that celebrates Guinness do not stress Arthur’s elite social position, but instead describe him as a daring entrepreneur. According to Guinness marketing literature, “He was the man who, in 1759, took a chance and signed a 9000 year lease, at an annual rent of £45, on a disused brewery in Dublin…The Brewery then consisted of a copper, a kieve, a mill, two malthouses, stables for 12 horses and a loft which could hold 200 tons of hay.” The information provided by Guinness neglects to mention that along with the brewery, a commodious dwelling house with a spacious garden that included a fish pond, was also part of the property. Therefore, the “chance” taken by Arthur Guinness came with a luxury home.
Soon after the beginning of Arthur’s lease, problems arose between his brewery and the Dublin City Corporation. The problem regarded Arthur’s refusal to pay for the use of city water. In the 1764 Dublin Assembly Roll, a township committeeman stated:
Your committee observe to your honours, that they have used all reasonable methods to induce Mr. Guinness to become tenant to the city for water, which he has hitherto declined, insisting upon a right, thereto, without paying any compensation for the same, and though he has several times promised to show his title, he has now totally refused it. We therefore think it would be proper, that the committee be empowered to take such effectual methods as may be necessary to prevent his having any future supply of water, until he agree to pay for the same and discharge the arrears, and should any expense arise thereon, the same to be defrayed by the corporation.
The Dublin Corporation eventually decided to cut off the city water supply to the St. James’s Gate Brewery. The sheriff was advised to dispatch two men to the brewery, while corporation workers shut off the supply. However, Arthur Guinness intervened and prevented the men from cutting off the water supply. A witness to the scene reported that:
Mr. Guinness came on the scene, took a pickaxe from one of the workmen, and ‘with very much improper language’ declared that they should not proceed with the job, ‘saying that if they filled up the watercourse from end to end, he would open it up again.’
Eventually, the disagreement was resolved, twenty years after Arthur Guinness was originally asked to pay for the use of city water. On 24 May 1784, Arthur agreed to sign an 8,795-year lease that required him to pay £10 a year for the use of city water. (Both this lease, and the original lease, have been modified since that time.)
During the years of the prolonged water dispute, another important development took place at the St. James’s Gate brewery. Arthur Guinness first began to brew porter in 1778, and would eventually stop brewing ale in 1799. Arthur was inspired by a London brewer, named Harwood. Harwood developed a brew which he called “Entire”, that used roast barley and high temperatures in the brewing process. (It is the roast barley which gives the drink a dark ruby color, the nitrogen bubbles you see as the drink settles produces the white head at the top.) The dark brew was a favorite drink among the street porters of Covent Garden, London, who drank it for its high iron content. The drink was nicknamed “porter”, and was soon exported to Ireland. The St. James’s Gate brewery would develop several types of porter, eventually introducing the word “stout” to describe its versions of porter. (In the late 1600’s to early 1700’s, the term “stout” was used to describe a strong beer.) Arthur was strongly influenced by an English brewer, but also had other critical connections to England.
The one aspect of Arthur’s life which makes the most compelling case against the claim of his Irish identity would be Arthur’s political allegiance. Arthur, like many members of the elite minority, was closely aligned with the forces of English colonialism. Arthur was directly opposed to any movement toward Irish Independence, and wanted Ireland to remain under English control. He was publicly opposed to any political or social change that might threaten the rights of his property. These political beliefs become even more apparent in future generations of the Guinness family.
The Guinness Family
After Arthur Guinness retired from the brewery, his son, also named Arthur (1768-1855), assumed control. Along with sharing the same name, the two had similar political outlooks. In the general election of 1835, the second Arthur Guinness not only opposed Daniel O’Connell, but seriously considered running against him. O’Connell fought for the repeal of the Act of Union, and therefore the independence of Ireland. Arthur Guinness voted against him, and continued with the Guinness loyalty to English rule. Supporters of O’Connell called for a boycott of Guinness, but O’Connell eventually dismissed such actions.
Benjamin Lee Guinness (1798-1868), Arthur’s son, took full control of the brewery after his father’s death in 1855. Around this time, he purchased what was then worth between £20,000 and £30,000 worth of land in County Mayo. He would also later buy a luxurious estate in Ashford, County Galway. Benjamin purchased this land during the years surrounding the massive starvation in Ireland. He was an extremely wealthy man who possessed the ability to aid evicted and starving farmers, but opted instead to exploit a prime investment opportunity in real estate.
Benjamin also entered politics by being elected Lord Mayor of Dublin in 1851. In 1865, he was elected within the Conservative interest to the Irish Parliament. And naturally, he was a strong Unionist. Referring to nationalists, he stated:
Those wicked and worthless adventurers who would not only deprive our country of the advantages which, as a part of the British Empire, we enjoy, but who would overturn all the social arrangements of society.
On Fenianism, Benjamin stated:
Irishmen generally abhor the projects of Fenianism; and the sentiments of sedition and rebellion which its followers inculcate have emanated from a foreign land, and been spread and nurtured in this country by emissaries, who hope by deception and by pillage to grasp from its owners their property.
Following Benjamin’s death in 1868, the brewery was transferred to his two sons, Arthur Edward and Edward Cecil (1847-1927). Edward Cecil eventually bought out his brother, who showed little interest in the business. Edward continued the same political outlook as his father. During a time of optimistic Irish nationalism, Edward used his position as High Sheriff of Dublin to assist in the organization of the State visit of the Prince of Wales, later Edward VII. This act later earned him his baronetcy.
In 1886, Edward Cecil made Guinness a public company to be quoted on the London stock market. The decision therefore placed Guinness as an English company. He chose Baring Brothers as his merchant bank, and the company floated for £6 million. The most remarkable aspect of the deal was the favoritism showed toward the wealthy elite. Shares of the company were hoarded by the rich, which left the public little opportunity to invest. Although the event was then legal, it led to vast public criticism.
Edward Cecil divided control of the brewery between three sons, with Rupert Edward (1874-1967) succeeding him as the Chairman of the company. Rupert won a seat during the General Election of 1906, as another Conservative Guinness who opposed Home Rule. Soon after this, members of the Guinness family spoke in the House of Commons to recommend the execution of the leaders of the 1916 rising, an event that clearly revealed the family’s long held political beliefs.
The ownership of Guinness shares was kept within the family through inheritance and this continued until 1986, when Ernest Saunders became CEO of the company. Until then, there were board members related to Edward Cecil’s three sons. The percentage of family ownership decreased through continual division of shares, and mergers with other interests. For example, the takeover of Irish Distillers reduced their share percentage from 22% to 4.5%.
Ernest Saunders, who is not an Irish citizen or related to the Guinness family, was arrested along with others in March 1987 on charges related to insider trading. Before his appointment to Guinness, Saunders was a highly skilled marketing and public relations man who worked in Geneva for Nestle. During this time, Nestle discouraged mothers in Third World countries from natural breastfeeding, and promoted the use of Nestle’s powdered baby formula. The formula had to be mixed with the infected water of these areas, which led to the widespread sickness of babies. An international boycott of the company ensued with the aid of the World Health Organization. Saunders was involved with attempts to reconcile Nestle’s image with the public. Guinness was aware of this incident before they offered Saunders the position of CEO.
Anthony Greener is also not an Irish citizen or related to the Guinness family. He joined Guinness in 1987, and eventually negotiated the merger of Guinness and Grand Metropolitan in 1997 to form the Diageo corporate group. After the merger, Diageo held controlling interests in Guinness, Burger King, Haagen-Dazs, and Pillsbury. Queen Elizabeth knighted Greener in June 1999 for his role in creating Diageo. The Diageo corporate group has since sold off its holdings in Burger King, Haagen-Dazs, and Pillsbury, and has acquired Seagram’s to further consolidate its position in the international drinks market.
Throughout history, the ownership of Guinness is unable to claim any true connection to Ireland. It is more accurate to state that the beliefs of Guinness ownership have always been anti-Irish. This point becomes more evident through the examination of the Guinness workforce.
Many people might consider Guinness to be Irish, because they believe the workers who brew the beer reside in Ireland. However, a closer look the structure of the Guinness workforce reveals a clear reflection of the political philosophy of Guinness ownership. This begins with the segregation of the workforce, and continues with elimination of more and more Irish jobs in the name of rationalization.
The Guinness workforce was segregated from the very beginning. For most of its history, Guinness management has been dominated by the Protestant minority of Ireland. Catholic workers were barred from holding a management position. In fact, it was not until the 1960’s that a Catholic worker entered management, after facing strong opposition. In other words, over two hundred years had passed since the signing of the lease at St. James’s Gate brewery before a Catholic was allowed promotion to a management position.
Guinness maintained its headquarters in Dublin for many years, and many Dubliners found employment at the brewery. Despite the absence of internal promotion, Guinness workers were highly paid in comparison to other jobs in Dublin, and received health and other benefits before they were introduced to other occupations throughout Ireland. Many of the jobs at the brewery required great skill, however the vast majority of them have since been eliminated. Job reductions were caused by the introduction of new technologies at the brewery, but also the new philosophy that currently influences the Guinness operation.
Today, the structure of the Guinness workforce is less driven by the apartheid system of sectarianism. It is now more controlled by the agenda of corporate capitalism. Workers at the brewery are less likely to be oppressed due to their religious beliefs, but now face being victims of a rationalization plan. The effects of the Guinness family’s allegiance to British rule have been replaced by the effects of the ownership of the Diageo corporate group.
The effects of the Diageo ownership became clear in July, 2000, when Guinness announced plans to close the brewing and packaging plants in Dundalk, located just north of Dublin. The move came as a shock to workers and the community of Dundalk. This was the first Guinness plant closing ever to occur in Ireland. The closing eliminated over 300 jobs in a small community, as management justified the move as part of plan to remain globally competitive.
The famous brewery at St. James’s Gate has also seen tremendous change. During the 1930’s, Guinness employed over 12,000 men in Dublin, nearly 10% of the male population. Today, there are only an estimated 500 workers left at the St. James’s Gate brewery. Many departments that once existed at St. James’s Gate have been moved to the Park Royal brewery in West London, which has long been considered the headquarters of Guinness. As Guinness now operates breweries in several countries, Irish workers presently form a minority of the Guinness operation.
Not all areas of the St. James’s Gate brewery have faced reduction. The tourist facility at the brewery has recently received tremendous investment. In 2000, the £32 million Guinness Storehouse was opened at St. James’s Gate brewery. The Storehouse invites visitors to experience the history and wonders of Guinness Stout by exploring a Guinness museum, enjoying Guinness at the Gravity bar, and purchasing Guinness merchandise at the retail shop.
Around the same time as the opening of the Guinness Storehouse, talk began of a possible move from St. James’s Gate. The Diageo management is still considering moving the brewing operation from St. James’s Gate to a location just outside of Dublin, in order to improve the efficiency of distribution. Brewing would completely cease at the site, leaving behind only one responsibility at St. James’s Gate, the production of marketing messages by the Guinness Storehouse.
This is not to say that St. James’s Gate brewery would no longer be an essential part of Guinness, as the brand image production of Guinness is very important to the company. This tradition dates back to April 5th, 1862, when the O’Neill harp, (an icon of Irish history that has been associated with Nationalist movements), was chosen as the Guinness trademark. From that time through to recent promotions that gave away Irish pubs to Americans on St. Patrick’s Day, Guinness has always invested heavily in portraying an Irish image to particular markets. And this investment has paid off very well, just take a look around on St. Patrick’s Day.
So, should Guinness be involved in St. Patrick’s Day celebrations? Absolutely. It should be used as a point in conversation to better understand the events of Irish history. This would be a great improvement on the more popular activity of contributing to a legacy of inequality and greed.