Translated for you: the best wines end up only in the hands of the richest
Translated for you: the best wines end up only in the hands of the richest
The NYT winemaker highlighted how the income inequality is denying the spread of the best wines to all segments of the population.
The original article “How Income Inequality Has Erased Your Chance to Drink the Great Wines” by Eric Asimov appears in the New York Times. In the article, the critic analyzes the reasons why the best wines increasingly end up in the hands of the richest: we have translated it for you.
Among the many ways in which the richest are different from you and me: only they can afford the Burgundy Grand Cru . It wasn’t always like that.a bottle that cost $ 80 in 1991 now costs $ 800In the 1990s, middle-class oenophiles could still afford to experience that particular rite of passage, which consisted of drinking a truly great wine , not only to taste it, but to understand, in the eyes of history, what quality made it so exceptional. Oh yes, usually the cost of this ritual was a drain, a sheer madness. But it was still feasible: as was buying Bordeaux Premiere Cru, or the top of the range Barolo, Brunello di Montalcino or Napa Valley Cabernet Sauvignon, just to name a few. For example, in 1994 a bottle of 1991 Comte Georges de Vogüé Musigny grand cru sold for 80 dollars (which in 2020, calculated for inflation, is equivalent to about 141 dollars). Today, however, that same bottle costs 800.
A more extreme case is that of another grand cru, the 1990 Domaine de la Romanée-Conti La Tâche , one of the greatest wines in the world, which in 1993 cost $ 285 equivalent to $ 513 today. Today a bottle of 2017 La Tâche costs around $ 5,000 , and is out of reach for most of the keen oenology students, except the wealthiest ones. There are many other options: opting for the Village Burgundy rather than the grand cru, or for another of the many great wines that are produced all over the world. But now these historic bottles are no longer part of a conversation that has been going on for centuries.
For wine lovers, drinking such renowned bottles is comparable to taking a university course focusing on Shakespeare, Beethoven or Charlie Parker . In every field it is necessary to understand the reference points, those that connote grandeur, to be able to join the conversation even if only to affirm a contrary opinion. And these days it has become impossible for many to be able to afford these wines. Of course, it can be said that wine is not the only sector to have experienced increases in recent decades. After all, why should wine be different from other types of articles?
But the point is certainly not that of the generalized increase in prices. The prices of the top of the range in the world of wine have risen more fiercely , even compared to other so-called luxury items. The 2017 La Tâche is almost 18 times more expensive than the 1990 one, while a classic Hermès Birkin 30 bag , which in the world of women’s handbags is equivalent to the grand cru, went from $ 3,000 in 1990 to $ 11,000 in 2020, an increase of not even 4 times.
The parameters of Bordeaux are hardly different from those of Burgundy. Much more is produced in Bordeaux. Even in its field there are wines of reference and even there the prices have skyrocketed. Orley Ashenfelter, a lecturer in economics at Princeton University, has been keeping track of the Bordeaux market for years . In 1980 the price of a Bordeaux premiere cru was roughly four times that of a Bordeaux cinquièmes cru (a classification which, he explained over the phone, divides the major Médoc producers into five growth bands). Today, he says, given the enormous price growth that characterizes the sector, the ratio between the two has risen to 10: 1.
How can this disparity be explained? In part it is due to the ancient law of supply and demand. The greatest wines are closely related to restricted areas of growth and production and to the rhythms of the agriculture that generates them.the disparity is partly due to the ancient law of supply and demandWith a limited amount of grape varieties and a single opportunity each year to convert them into wine, you can’t increase production to meet the increased demand. With the exception of some top champagnes such as Dom Pérignon, which are not related to any particular grape variety, the best wines are not luxury genres such as wristwatches and bags., where, for example, production is increased to meet demand. Yet even for a trophy wine like Dom Pèrignon, the price has relatively increased. A study published in 2017 in The Journal of Wine Economics analyzed champagne prices in New York from 1948 to 2013, determining how many hours people in various income brackets would have to work to pay for a cheap champagne, a mid-range bottle, and a luxury cuvée like Dom Pérignon.
The study found that cheaper bottles, across all income brackets, required fewer hours of work in 2013 than in 1948, but that the hours needed to buy a luxury bottle had increased. China’s economic opening has expanded the market for top-of-the-range winesAdditionally, the study pointed out that the hours required by a luxury champagne increased at a higher pace for lower-income groups when compared to higher-income groups. This meant that the access of those groups had decreased. But the thirst for these top of the range continues to increase exponentially . The typical public of these wines was once restricted to connoisseurs from Europe, North America and elsewhere in the world. After the Second World War it expanded, encompassing countries such as Japan and Australia , and then exploded with the fall of the Iron Curtain and the economic opening of China., supported by the globalization effect of the network. Today, all wine lovers in the world focus on the same great Burgundy batches available in 1990.
In another Bordeaux-related example, Professor Ashenfelter, along with two researchers from the University of Bordeaux, presented a study in 2018 that showed that while income inequality has been increasing since 1980, the price of Bordeaux premiere cru has been growing equally. step. While this particular problem seems to concern only wine enthusiasts, the growing inaccessibility of luxury wines is just a microscopic example of how income inequality and the centralization of wealth in a few hands actually affect everyday life .
In Manhattan, where I live, at least until just before the pandemic, the price of real estate had continued to rise for decades, while companies and people were competing for a vast but limited amount of space. And so Manhattan has gradually become off-limits to smaller companies, struggling artists and writers, not to mention cops, firefighters, or public officials. Yet millionaires continue to fight over the little space left. In 2019, a multi-billion dollar investment fund paid $ 238 million for an apartment in a building that was only built after dozens of middle-class renters were evicted from the original building.When billionaires decide they want something, whether it’s an apartment or a bottle of wine, they drive up prices for everyone else .
I admit that I am simplifying a very complex subject. But according to this logic, thriving mixed neighborhoods have been transformed into luxury ghost towns, and what was the substance and spirit of so many communities has had to give way to mammoth apartment buildings with absent owners and occupied only by chain stores.fortunately today great wines are produced in all parts of the world” In order for income differentials to support rising prices, production cannot increase, ” says Professor Ashenfelter. ” This is the secret of wine and the real estate sector “. It is not my intention, however, to paint a disheartening picture for wine aficionados. Just as artists and writers have had to leave Manhattan to go to other parts of New York, many wine lovers have had to turn elsewhere in search of vital learning experiences.. And fortunately today great wines are produced in all parts of the world. Those who are fascinated by how wine can reflect the characteristics of a place and a culture in the most intricate details can turn to the German rieslings, the Chenin Blancs of Savennières and the classic Chianti and Priorat. There are many less expensive options even among Burgundy and Bordeaux, highly enjoyable wines that help to get an idea of why the region is famous, even if of course they fail to tell the whole story.
The winemaking areas themselves, and the cultures that gave birth to the wines, are equally vulnerable. Bordeaux is dominated by guilds, but Burgundy was largely a region of small farmers until recently. Only in the second half of the twentieth century, when a more conspicuous part of farmers began to bottle their own wine rather than sell it to wholesalers, did they also begin to see a fraction of economic prosperity. Today the price of Burgundy has skyrocketed the value of plots of land, threatening the continuity of small family businesses in the region, due to the exorbitant increase in inheritance taxes and the natural inclination of some of the new generations to collect the proceeds of the sales instead of cultivating the vines.
This has not yet happened on a large scale, but in 2017, for example, Bonneau du Martray, which produces an exquisite Corton-Charlemagne, a Burgundy grand cru, was sold to American billionaire Stan Kroenke, after which for more than two centuries it had remained the property of the same family. many billionaires buy premium bottles for future profit, not for drinkingAnd maybe Kroenke will turn out to be an excellent manager and owner over time. However, the community and its culture have suffered a huge loss. I spoke to Burgundian producers who complained that their wines only ended up in the cellars of the wealthiest collectors , or to investors who never opened them, expecting to make a profit as they aged. And the producers told me that those bottles were made to be opened and enjoyed. But it’s not like they can do much about it. If they sold their wines at a lower price, investors would rush to buy them in bulk and then resell them at current market prices. The only difference would be that the money would end up in the pockets of investors rather than in those of producers, without having to wait for the years of aging to make its value rise. Reduced access to great wines is certainly not a catastrophe, or a problem for those who are not passionate about wines. But that’s a real shame .