How much money is too much money for a multi-course dinner at one of the San Francisco Bay Area’s top restaurants?
That’s what the San Francisco Chronicle’s longtime restaurant critic, Michael Bauer, asked this past Sunday in this article, in which he takes to task Bay Area restaurants that raise their prices to astronomical levels but all too often fail to deliver for the money.
What kinds of prices are we talking about? $398 at Saison…$310 at French Laundry…$298 at Atelier Crenn…$220 at Quince…$500 at Meadowood…throw in some good wine and the amount soars even higher. I mean, not that long ago those prices would feed four people, not just one.
In the article, Bauer traces the evolution of this price inflation and blames it on the confluence of three things: “food-obsessed tourists” coming to the region, who are already psychologically primed to spend a lot of money on a meal; “the sophistication of the Bay Area dining public,” which includes me and, I assume, those of you lucky enough to live here; and—bottom line–“enough disposable income to indulge.” The latter apparently is no problem here in San Francisco, which sometimes seem like it’s swimming in money the way Uncle Scrooge used to in the comics.
How much you choose to spend for dinner is up to you, of course. But I agree with Michael Bauer when he says, “[N]o matter the price tag, there has to be a sense of value. High prices are not a given; they have to be earned.” I’m sure you agree, too; the problem is that these places would not be able to get away with these exorbitant prices if people weren’t prepared to pay them. I’ve had my share of these dinners (Saison, French Laundry, Meadowood and others, including beyond the Bay Area), and was fortunate in that somebody else was usually picking up the tab. But everytime I have one of these meals, I think, “For this price, I could eat at any of my favorite restaurants in Oakland ten times.” This is true, I’m sure, for everybody else, so why do people continue to queue up for seats at these palaces of gastronomy?
For the same reason they line up for the most expensive wines. There are psychological phenomena at work, ranging from not wanting to miss out on something special, to bragging rights and an authentic curiosity about what food at that price tastes like, how it’s served, and the ambience in the restaurant. We foodistas are understandably passionate about great meals. It goes with the territory if you’re a wino. Still, the psychological part fascinates me. I sometimes feel like an anthropologist who’s parachuted into the Bay Area to observe the social habits, including dining, of the natives. Like Margaret Mead when she observed Samoan culture in the 1920s, I want to understand the behaviors of a very particular group: well-educated, primarily white, middle-aged gourmands who are able to afford to eat in the top restaurants of Napa Valley, San Francisco and the Bay Area in general.
This group radiates confidence and refined sensibilities, but at heart they also suffer from a sense of insecurity. Although they possess many things in the form of material comforts, they feel like something is missing from their lives. What it is, cannot be accurately defined; if it could, they would possess that, too. Perhaps the thing they feel is missing cannot be possessed, but one never knows until one has tried. And so the search goes on, for a greater wine, a greater vacation destination, a greater restaurant experience. As Buddhism points out, “desire” is the attempt to fill a spiritual hole that cannot be filled; the pursuit of things to fulfill desire will always be fruitless; the rarest commodity in the world will not really fulfill desire because change—irresistible, inevitable—soon will have us feeling dissatisfied again. And so back at it we go, seeking an ever greater food, wine, exotic locale.
Well, I don’t mean to be the snake at the garden party. I like good food and wine as much as you do. And I don’t care what somebody spends at Quince, or what they don’t spend; it’s no skin off my nose. I do hope that people who drop these big bucks at restaurants are also using their money in more charitable ways, to help others; and I think there’s something to be said about frugality as an attitude towards life. We don’t see much frugality in the Bay Area; we see a lot of its opposite, profligacy. That means “the careless and foolish wasting of money.” Again, of course, it’s not my place to tell you or anybody else what to do with your money. I can only speak for myself.
Those who read this blog and hear me speak know that I have been predicting the discovery or uncovering of small, stellar blocks within existing great vineyards in California and Oregon—blocks that can be called “grand crus” were we to adopt that French terminology. This process will take decades, but clearly it’s underway.
I have argued that this evolution of a vineyard into greater and lesser blocks or climats is inevitable. It happened in France and in Germany, and for the best of reasons: grower/vintners, usually monks, discovered over hundreds of years that some sites were naturally superior to others. These, they gave special names to, and when a market-based system of supply-and-demand replaced the old feudal system, these special blocks were prized, and priced, the highest.
Why this development is inevitable and unavoidable is because of the nature of wine: something in it, and in us, makes us sensitive to the slightest differences. We seek those differences, make judgments as to their relative merits, collectively decide which blocks are the best, and reward them, as the free market allows and even encourages.
Is this rewarding, this hierarchizing, justifiable? Is it based on true qualitative differences in the wines, or is it only the critical perceptions that we know can be shaped by marketing? Undoubtedly, a little of both. Great marketing cannot make a silk purse of a sow’s ear. It can, however, take two silk purses, both near each other in quality, and make one Prada and the other Sears.
As if in evidence of this line of thinking, Domaine Trimbach, the well-known Alsace winery, just announced that, for the first time, they are taking advantage of Alsace’s Grand Cru appellation system to market their wine, something they have been reluctant to do until now. Why? “[W]e cannot today escape the grand cru any more because with all the media, with all the fuss and the buzz and whatever around the system,” says Jean Trimbach. Around the world, he argues, people know the names of the Alsace Grand Crus and demand them. The implication is that it’s not because a Grand Cru is better than a regular Alsace AOC wine, it’s because people “know exactly what the top grand cru[s] are, so you cannot escape the grand cru game any more.”
The grand cru game…is that all it is, a game? Is there any relevance to inherent quality? Or have the Alsatians, like the Bordelais and the Burgundians, been hoisted on a petard of their own making?
Being a fair-minded journalist, I must admit that the answer is not that simple—although we all wish it were. Those of us reared in this “game” of comparative terroirs have it emblazoned into our DNA that some plots are better than others. To deny that this is true is one of the few heresies of wine connoisseurdom. This is why land in Vosne-Romanée is much more expensive than land in Beaune, why land in Oakville is much more expensive than land in Paso Robles, even though, in a blind tasting, I can assure you that some Paso Cabs would give Oakville a run for its money.
Indeed, such is the power of appellation—or, I should more correctly say, the awareness of appellation—that we have a situation in which the price for an acre of “the choicest land” in Napa Valley is now $310,000, up a remarkable $40,000 over 2014.
“The wine grape vineyard market continues to operate in a universe of its own,” says an expert in land prices in yesterday’s Napa Valley Register, referring to a phenomenon known as “the pedigree of the parcel,” in which the “pedigree” is conferred as much by subjective factors as objective ones—and perhaps even more so.
Once a vineyard has been prized so astronomically, there’s only one direction to go: To find little pieces within the vineyard that can be priced even more astronomically. This is the basic duty of capitalism: to test what the market will bear. And, as another expert in the Napa Register article said, “Actual sales [i.e. prices] can go even higher.”
In other words, unless there’s a bubble—and I don’t see one coming—we’re in for more and more expensive wines from California and Oregon at the highest levels. There’s nothing to stop it. It is, indeed, inevitable.
I blogged the other day about price points in California Chardonnay, and how the best scores that inexpensive ones seem to be able to get is in the mid-80s, maybe the high 80s and, very occasionally, a 90 pointer. Then one of my readers sent in the following comment.
Just something to think about. If the biggest selling Chardonnay brands are rated in the 80’s and low volume $75 Chardonnay is rated in the 90’s maybe the critics are out of touch with what wine really should taste like. Maybe the biggest sellers deserve a higher score, they are after all 90+ point wines in the minds of those huge number of buyers.
This is a clever argument; one might even call it sophistic. It’s basically a version of “the customer is always right” or—in another era—“Forty million Frenchmen can’t be wrong.” It suggests that the fact that so many consumers love inexpensive Chardonnay means that inexpensive Chard is actually better than expensive Chard, or at least deserves a higher score.
Well, the obvious thing for me—a former wine critic—to say is, Nonsense. The millions of Americans who enjoy these inexpensive Chardonnays don’t have the experience we critics do. They [the consumers] don’t understand fine wine; they drink inexpensive stuff; like somebody dressing in clothes from Target, they think it’s high-end. (No disrespect to Target!) But as soon as I write those words I realize how wrong they are. It’s not that consumers prefer inexpensive wines to expensive ones, it’s that they can’t afford expensive wines, at least on an everyday basis. So it’s a little cray-cray to say “the biggest sellers deserve a higher score.” In fact, based on my experience, when I offer a “regular” consumer a high-quality expensive Chardonnay (or Cab, or Pinot, whatever), they invariably appreciate its Wow! factor, and understand that it’s better than their $10 bottle.
But before I entirely dismiss the reader’s comment, he did make a point worth considering, and that was “maybe the critics are out of touch with what wine really should taste like.” Well, what should wine “really taste like”? Darned if I know! I suppose there are critics out there who “know” what St. Joseph or Barolo or Napa Valley Cabernet “should taste like,” but what does that mean when people are breaking the rules all over the place? And why should anyone care if a critic says something doesn’t taste the way it should (or the way he thinks it should) if in fact it’s delicious? What this all comes down to is, Do we judge wines by popularity, or by critical consensus? I would think the latter, especially as the price ascends. But if you’ve been reading what I’ve been writing here for the last seven years, you know that there’s no such thing as “critical consensus,” so we’re really in the dark. If I were to write a third wine book (and I won’t), it would be on this precise topic: varietal character, typicity and quality.
Why, exactly, is one wine 87 and another 97? You readers—consumers—deserve an explanation. Is it enough to trust the critic? In what other areas of your life do you turn over your decision-making to third parties? Your 401(k) advisor? ROTFLOL.
What does this all mean? I have a feeling wine criticism and reviewing is changing in profound ways, but I can’t quite put my finger on it. “Through a glass darkly” and all that. It’s related to demographic changes in America, mostly among Millennials and the generation coming up behind them, who seem to be increasingly fractionalized, tribalized, peer-group-ized, and impervious to authority. I wish I had a crystal ball.
Good for President Obama for choosing to serve a screwtop wine at last Friday’s State Dinner for Chinese President Xi Jinping. I do believe that’s a first for this White House, or any other for that matter.
Historically, the White House has served very expensive wines, finished with corks, at State Dinners. For a long time, these wines were mainly French. Thomas Jefferson served Lafite Rothschild; JFK served Haut-Brion Blanc; and when Nixon was President, he loved Chateau Margaux, although an anecdote revealed in Woodward and Bernstein’s “All the President’s Men” told how Tricky Dick would have his butlers discretely pour him Margaux, wrapped in a white cloth napkin, while the other guests got Mouton Cadet.
That all began to change during Reagan’s administration (he was justifiably proud of California wines), and today, it would be very strange for a President to pour foreign wine, unless it was from the country of the visiting dignitary (at last week’s Xi-fest, for example, the White House served Chinese Shaoxing rice wine). Many are the California wineries that proudly display a menu in their tasting room or office showing how and when one of its wines was served at the White House. And, of course, these tended to be expensive wines.
Four years ago, Republicans predictably and harshly criticized Obama for serving an expensive Washington State wine at a State Dinner for then-Chinese President Hu Jintao. The Tea Party website, Gateway Pundit, slammed the President for pouring a $399 bottle of wine to “Chi-Coms” [Chinese Communists], heading their hit piece “Sacrifice is for the little people,” and conveniently overlooking the fact that their hero, Ronald Reagan, also served very expensive wines: at one State Dinner, he poured a trio of California wines that, for the time, were quite pricy: Clos du Bois Calcaire Chardonnay, Carneros Creek Pinot Noir and Schramsberg Cremant Demi-Sec. More recently, there was President George W. Bush, who once served a Shafer Hillside Select ($245) at a similar dinner.
Perhaps it was criticisms like the one from Gateway Pundit, however selective and unfair, that prompted Obama to go screwtop. The particular wine he chose was a Penner-Ash 2014 Viognier, from Oregon, which retails for $30. It was paired with lobster (“poached in butter and served with traditional rice noodle rolls embedded with spinach, shiitake mushrooms and leeks.” Mmmm….but can we get rid of the word “embedded”?).
Obama’s screwtop embrace isn’t the most earth-shattering news ever. But it is a nice development in the sense of underscoring a new and, dare I say it, more democratic [small “d”] attitude towards wine that seems to be permeating across America, and that reflects an emerging sensibility that the most expensive things aren’t necessarily the best. Indeed, as I’ve long argued (and most critics agree), price is not always a reflection of quality; beyond a certain price point, you’re paying for image and psychological satisfaction.
Now, as to why wineries continue to be so resistant to screwtops, that’s another story!
Interesting article by the Chronicle’s occasional wine writer, Jon Bonné, in yesterday’s paper, on a range of topics related to wine prices, but mainly more or less of a warning that they may be too high to be sustained.
Jon fairly points out that labor costs in California are very high (just look at the cost of housing), and vineyard prices also are increasingly beyond the means of all but the superrich, at least in prime coastal growing regions. These things all contribute to the cost of the bottle—but perhaps the prime culprit is a “we’re-worth-more argument” that prompts many winery owners, maybe too many, that they can charge just about any price they feel the market will bear, because…well, just because.
You can’t go into a fine wine shop and not agree. Prices really have shot through the roof—despite the Great Recession, which may temporarily have halted the inflation in some cases, but if it did, no more. At the ultrapremium end, prices just keep going up, and up, and up, which leads Jon to ask the (rhetorical) question, “Wouldn’t it be a shame if…progress was halted because the people…decided it just wasn’t worth the money?”
Good question. What will it take for consumers to say, The heck with it, I’m not paying $80 for a bottle of Pinot Noir when I can get something just as good for half that price, or less—whether it’s from California or some foreign country?
I myself can’t see far enough into the future to make a prediction. Ten years ago and more, I was wondering how so many Napa Valley wineries were able to get away with charging triple-digits for their Cabernets. I thought then that lots of them would be forced out of business. That didn’t happen. So I’m out of the prognostication game. In fact, nobody knows where prices are going, but in the history of wine in California and in Europe, they seldom, if ever, go down, so we can only assume that they’ll continue to increase, albeit possibly at a slower rate.
Some commodities and consumables do decrease in price or at least hold steady when market conditions aren’t so good. That’s why we’ve seen basically flat inflation in the U.S. ever since the Great Recession. Things just aren’t getting more expensive. But wine seems to able to disobey the classical laws of supply and demand. I’m not sure why that is. I think, in many cases, winery owners are independently wealthy, so they can ride out periods of decline, sometimes for many years. I think also that wine, alone of all alcoholic beverages, has the allure of luxury: it’s an aspirational drink. Like diamonds, or sports cars, or designer clothing, wine has managed to furbish itself with a glow, in a way beer and spirits haven’t. True, both beer and spirits are available in very expensive bottlings. But think about it: beer’s fundamental image, at least in America, is of a cheap buzz, in front of the tube on Football Sunday. The image of spirits is more complicated, but then, spirits are cheaper than wine, when you compare the two ounce-per-ounce in terms of alcoholic strength. A good bottle of Scotch might set you back $60, but you’ll get a lot of mileage out of it over time, and unlike wine, it won’t go bad in a few days.
Wine by contrast seems to lift any occasion into the realm of special and celebratory. People still ooh and aah over wine: even a meal in a place like Chili’s or Applebee’s is heightened when wine is set on the table. People perceive this about wine, consciously or not; either way, wine makes their meal feel more special. And because wine has this quality of glamour, consumers seem willing to pay extra for it.
How much extra? That is the question. I’m not as worried as Jon is about California wine pricing itself out of the market. There will always be moderately priced California wine—say, under $20—and as for the under-$10 segment, I don’t really think that much about it, except that I’m glad it’s there because it gets people to drink wine who might not otherwise.
But I do continue to wonder about these Cabernet Sauvignon, Pinot Noir and, now, Chardonnay prices that are skyward bound. I suppose the wineries who are taking price increases know what they’re doing. At least, I like to think so. But Jon, coining a phrase, referred to “the neuroses of [California’s] prestige” as a way to pointing out that some wineries are taking increases, not because they know what they’re doing, but because they think they do; they think they’re riding the same bubble as Bordeaux.
Maybe they are. Maybe they’re not. Maybe Bordeaux’s bubble is unsustainable. Like I said, I don’t play the prognostication game anymore. But, if you look at the history of Bordeaux prices over the centuries, they have just one direction: up.
It’s certainly true, as Robert Parker pointed out in his recent interview in The Drinks Business, that high wine prices are “a problem and a concern” and that they are creating “a caste system” in which “the younger generation” cannot afford top wines from regions such as “Burgundy, or Bordeaux, or from California.”
But there’s nothing really new about this situation. It’s been so forever. In fact prices for Bordeaux today, adjusted for inflation, are no higher than they were 100 years ago. What is interesting, to me, is the complex psychological contortions by which consumers (and some critics as well) arrive at the conclusion that price is a determinant of quality.
Long ago, vintners understood that the public suffers from this misapprehension. According to Edmund Penning-Rowell, who wrote what is still, to my mind, the most authoritative book on Bordeaux (“The Wines of Bordeaux,” 1969), “Baron Phillippe’s [de Rothschild] intense conviction [was] that Mouton-Rothschild was as good as any first growth, and for his money better than most. The only way that this [i.e. rise in its perception by the market] could be achieved was by asking a price as high as any first growth and if possible higher than all.” As Penning-Rowsell later makes clear, the Baron “was able to do this successfully.”
Baron Rothschild, of course, also was the partner of Robert Mondavi in establishing Opus One, which, at the time of its launch (the first vintage was 1979), “was the most expensive Californian wine.”
This strongly suggest that Mondavi learned his lesson in pricing from his friend. And we know, from personal experience, how many wineries, faced with tough sales, raised their prices, only to find demand radically increased.
Nowadays, the price of Opus One (about $240 for the 2011) pales in comparison to that of Screaming Eagle ($2,400 for the 2012 in the aftermarket). If your mind works the way most peoples’ minds work (including mine), it can be hard not to be impressed by that kind of price. A rational part of you thinks, “If it costs that much, and knowledgeable people are willing to buy it, then it must be one of the most fabulous wines in the world.” And, of course, these very famous and rare wines always are fabulous. But their prices bear no relationship to their quality, with respect to similar wines from similar appellations. This is why seasoned wine critics taste blind.
Back to Parker. He knows as well as anyone that the Bordeaux, Burgundies and Californians he helped push to astronomical heights can be very difficult to suss out in blind tastings. Why some people continue to buy them is, in fact, a matter for behavioral and cognitive scientists, not wine critics. As for the “younger generation,” I’m not so worried about them. They couldn’t afford Bordeaux First Growths in 1929, when Latour et. al cost nearly three times the price of Gruaud-Larose and Langoa, and they can’t afford it now.
Is price, as Bob speculates, “one reason why such people are turning to drinks other than wine.” ? It could well be, although good craft beer cannot be described as cheap. As I, and many other, observers have noted lately, beer and spirits seem to have the wind at their sails in a way wine at the moment does not, at least in our urban centers. Another question: Has this trend been created and fostered by the media, or did the media simply pick up on something that was already occurring on the street? As usual, it’s a little of both. What craft beer and cocktails have done—which wine has not—is to rise to the level of being cool. All those tattooed young mixologists, those hip brewmeisters, the trendy bars that have popped up from the Mission to Soho—they are the modern face of beer and spirits. What is wine’s modern face? As far as I can tell, it’s a young woman who opts for Pinot Gris on a date, your grandfather, or a somm.
I don’t overly fret about wine’s future because these trends come and go. Wine has been the most successful alcoholic beverage of all time for a very good reason; and what has worked for humans for thousands of years is likely to work for them for thousands more. Nor is wine in any particular financial trouble in the U.S. But it has lost a certain frisson of coolness, or at least the perception, the optics of frisson. In reality, wine is as cool as anything: winemakers themselves are as cool as any dashing mixologist, if not as visible.
But beer, in particular, is on a roll. In Britain, the brew industry is sponsoring a “There’s a beer for that” advertising campaign, crafted by the wildly successful filmmaker Michael Winterbottom (nominated for the Palme d’Or at Cannes), that was launched on Downton Abbey, and also is huge on Twitter and other social media.
If the industry is to lure the under-35 crowd away from beer and spirits to wine, it has to find ways to speak to them in their own language, on their own turf. This involves an accurate and fearless study of how beer and spirits are actually succeeding. One could do worse, as an academic enterprise, to hang out in a Valencia Street bar and study who’s drinking what. I volunteer for this vital work in the field, as the Margaret Mead of the cocktail lounge.