Among the many ways the rich are different from you and me: Only they can afford grand cru Burgundy.
That wasn’t always the case. In the 1990s, middle-class wine lovers could still afford to experience that rite of passage — drinking a truly great wine, not simply to enjoy it, but to understand what qualities made it exceptional in the eyes of history.
It might have been a splurge, perhaps requiring a few sacrifices. But it was feasible, just as it was possible to buy first-growth Bordeaux, or the top wines of Barolo, Brunello di Montalcino or Napa Valley cabernet sauvignon, to name a few other standard-bearers.
For example, back in 1994, a bottle of Comte Georges de Vogüé Musigny 1991, a grand cru, retailed for $80 (the equivalent of $141 in 2020, accounting for inflation). Today, that bottle costs about $800.
In a more extreme case, Domaine de la Romanée-Conti La Tâche 1990, another grand cru and one of the world’s great wines, cost $285 in 1993 ($513 in 2020, accounting for inflation). That’s no small sum then or now, but profoundly curious people might have found a way.
Today, a bottle of the 2017 La Tâche goes for about $5,000, well out of reach for dedicated students of wine, except for the most wealthy.
Plenty of other options exist: Village Burgundy rather than grand cru, or any of the many other great wines now being produced around the world. But these bottles, as good as they may be, have not been part of a conversation that has endured for centuries.
For wine lovers, drinking such renowned bottles would be the equivalent of a college course in Shakespeare, Beethoven or Charlie Parker. In any field, it’s necessary to comprehend the reference points, the benchmarks that connote greatness, to join that conversation even if ultimately you choose to argue the point.
These days, it is impossible for most people to pay for these wines.
You could argue that prices have risen on all sorts of consumer goods since then. Why should wine be different? You would not be wrong.
But the issue is not simply that prices in general have gone up. The prices of top wines have risen at a far steeper rate than the prices of many other luxury goods. La Tâche 2017 is almost 18 times as expensive as the 1990, while a basic Hermès Birkin 30 bag, the grand cru of handbags, has gone from about $3,000 in 1990 to $11,000 in 2020, not quite four times as much.
Bordeaux operates on a slightly different scale than Burgundy. Far more wine is produced. But it, too, has its benchmark wines, and like Burgundy, their prices have skyrocketed.
Orley Ashenfelter, an economics professor at Princeton University, has closely tracked the Bordeaux market for years. In 1980, the price of a first-growth Bordeaux was roughly four times the price of a fifth-growth Bordeaux, he said in a phone interview, referring to an 1855 classification that ranked top Médoc producers in five tiers, or growths. Nowadays, he said, as prices have risen for all these top wines, the ratio between first- and fifth-growth price is more like 10 to 1.
What accounts for these disparities?
Partly it’s the good old law of supply and demand. Great wine is tied to finite pieces of land and to the rhythms of agriculture. With a limited quantity of grapes and only one opportunity to make wine each year, production cannot be increased to meet rising demand.
With the exception of certain top Champagnes like Dom Pérignon, which are not linked to particular vineyards, the best wines are not luxury goods like watches or handbags in which production can grow to meet demand. Nor can production be kept artificially low, for that matter, to create demand.
Yet even for a trophy wine like Dom Pérignon, the relative price has gone up. A study published in 2017 in The Journal of Wine Economics analyzed Champagne prices in New York City from 1948 to 2013 by determining how many hours people in various income groups would have to work to pay for an entry-level Champagne, a midrange bottle and a flagship or luxury cuvée like Dom Pérignon.
The study found that the entry-level bottles across income groups required fewer work hours in 2013 than in 1948, but the hours necessary to buy luxury bottles had increased. What’s more, the study found that the work hours required for a top Champagne increased at a much higher rate for the lower income groups relative to the highest, meaning that their access had diminished.
Thirst for top wines continues to increase exponentially. The audience for these wines was once restricted largely to connoisseurs in Europe, North America and a few other scattered places. It expanded gradually after World War II, encompassing countries like Japan and Australia, and really took off with the fall of the Iron Curtain and the economic opening of China, spurred on by the globalizing effects of the internet.
Today, wine lovers from around the world clamor for roughly the same pool of great Burgundies that was available in 1990.
In another example from Bordeaux, Professor Ashenfelter, along with two researchers from the University of Bordeaux, presented a paper in 2018 showing that as income inequality has increased since 1980, the price of first-growth Bordeaux has paralleled the rise in top incomes.
Though the problem matters to wine lovers, the rising inaccessibility of fancy wines is just a microscopic example of how income inequality and the concentration of wealth in fewer hands have affected daily life.
I live in Manhattan, where, until the pandemic at least, the price of Manhattan real estate has soared for decades as more people and companies competed for a fixed amount of space. Predictably, Manhattan became harder to afford for small businesses, struggling artists and writers, not to mention civil servants, police officers or firefighters.
Yet billionaires continue to vie for space. A hedge fund billionaire paid $238 million for a new apartment in 2019, in a building constructed only after dozens of middle-class tenants were evicted from their apartments. When billionaires decide that they want something, whether an apartment or a bottle of wine, it drives up prices for everybody else.
I am admittedly simplifying a complex issue. But thriving mixed neighborhoods have been transformed into luxury ghost towns, as the lifeblood of many communities gave way to grandiose condominiums with absentee owners and chain businesses.
“In order for income differentials to drive price increases, supply can’t increase,” Professor Ashenfelter said. “That’s the secret of real estate and wine.”
I don’t want to paint too dire a picture for wine lovers, though. Just as artists and musicians left Manhattan for other parts of New York City, so have many wine lovers had to turn elsewhere for formative experiences.
Fortunately, great wines are being produced all over the world nowadays. Those who are fascinated by how wine can express in intricate detail the characteristics of a place and culture can turn to German rieslings, the chenin blancs of Savennières, Chianti Classicos and Priorats.
They also have many other less-expensive options, in places like Burgundy and Bordeaux, wines that are highly pleasurable and offer a taste of what the fuss is about, even if they don’t tell the full story.
The wine areas themselves, or the culture that made the wines what they are, are also vulnerable. Bordeaux is already dominated by corporate ownership, but Burgundy has until recently largely been a region of small farmers. Only in the second half of the 20th century, when more grape-growers began to bottle their own wines instead of selling to large merchants, did some measure of prosperity begin to flow toward the farmers.
Today, the price of Burgundy has sent land values soaring, threatening the continuity of many small family estates as succession of ownership is confronted with steep inheritance taxes and the natural inclination of some in the next generation to cash in rather than grow grapes.
This has not occurred on a wide scale yet, but in 2017, in one recent example, Bonneau du Martray, which makes exquisite Corton-Charlemagne, a grand cru white Burgundy, was sold to Stan Kroenke, an American billionaire, after 200 years of ownership by one family. Mr. Kroenke may turn out to be a fine steward of the property, but the community and culture lose out.
I’ve spoken to Burgundy producers who grumble about their wines’ going solely into the hands of wealthy collectors, or of investors who will never open them but seek to profit from them as their value rises. These bottles are made to be opened and shared, they will say.
The producers have little recourse. If they were to sell their wines at lower prices, investors would leap in to buy them and then resell the wines at the market price. The investors, rather than the producers, would pocket the profits, without having to wait years for the bottles to appreciate.
Diminishing access to great wines is certainly not a catastrophe, or much of a problem for anybody not enamored of wine. But it is a shame.
"how" - Google News
October 22, 2020 at 09:55PM
https://ift.tt/35qkMk2
How Income Inequality Has Erased Your Chance to Drink the Great Wines - The New York Times
"how" - Google News
https://ift.tt/2MfXd3I
Bagikan Berita Ini
0 Response to "How Income Inequality Has Erased Your Chance to Drink the Great Wines - The New York Times"
Post a Comment