TN:The Politics Of Wine

Greetings Mathew;

My situation here in Ontario may be somewhat unique and thus colour my view of the provincial government LCBO (Liquor Control Board of Ontario) "monopoly" on wine and liquor distribution and retail sale.

I live about a mile west of the intersection of Rtes. 20 and 81 in Stoney Creek which is the western start/end of the Niagara Wine Route thus making the dozens of wineries readily available to me. I BUY only Ontario wines thus, most of my source is very close and I usually drive right by a gov'mnt store or two or three to buy my tipple directly from the producer. This directs all the revenue directly to the producer without the LCBO filtering out "their" cut. As for my liquors, I find the LCBO quite adequately provides for my wants in this regard. I see no good reason for the LCBO to be privatised and the provincial treasury forego the very substantial profits generated by the organisation. Indeed, in response to the knee jerk privatisation agitation of the much detested Mike Harris brand Conservatives, the LCBO stated in that event, they would continued to be the distributor and would continue to take their margin.... thus, privatisation would simply add another private profit slice to the cost to the consumer and, I believe, restrict distribution of slow mover brands to a very few specialised establishments. I too would be interested in the results of the Albertan experience in this regard.

Colour me content with the status quo in Ontari-ari-ario!

Well, since you asked--I'll try to stick to wine, but must note at the beginning that despite my sig which mentions my career profession, my education is in political science: bachelor's and master's in PS plus a second master in International Relations. Spent the last seven years teaching poli sci in the local community college.

Minimally. There are certain minor fluctuations but speculation and taxation policy have much greater influence than currency markets in regard to what happens to wine prices. Give a screaming Wine Spectator review to a vintage year in a region and prices will soar. Institute a protectionist tariff and prices will be noticeably higher. Give a dollar to Euro decline and no one will notice.

The states in the US federal system deal with wine/liquor legislation. That means some states (very few) still have dry counties and some states will have state-run liquor stores, but for the majority the only fairly common inconvenience is no liquor sales on Sunday.

Shipping between states is a thorny issue, with about twenty states offering full reciprocity, twenty allowing some limited shipment and a handful being downright medieval regarding shipment of alcohol to individuals. Fortunately I live in one of the enlightened states.

Prescience is one virtue I lack. The democratic legislative process makes it necessary to build broad and deep concensus before action, hence we don't have a lot of willy-nilly chasing of the latest public policy trends.

There is a national "free the wine" movement to remove shipping restrictions, but beyond serious wine collectors it has little general population awareness.

No. My political ideology is free-market, fiscal conservative, strong defense, low taxation, individual responsibility traditionalist. (If you understand what that means, you will clearly identify my American political allegiance.)

Time for a dig here--so, you therefore think that you can interpret and recommend public official choices for the US? Certainly a conundrum of the "misery loves company" sort.

Those nasty old job-creating, economy pumping, civilization building developers.

Excuse me, but the "rapid fall", much like the reported demise of Mark Twain was "greatly exaggerated." I recall when the $ CAN was on parity with the $ US. There has been no demonstrable "rapid fall". There have been currency valuation shifts certainly, much of which can be attributable to the damage to the economy post-9/11. Beyond that, there hasn't been that much remarkable movement and in the manner of most things cyclical, the trends are upward throughout the US economy.

And, the majority of US citizens aren't interested in Canadian style socialized medicine or unification of our military services either.

Ed Rasimus Fighter Pilot (USAF-Ret) "When Thunder Rolled"

Hey Ed, I once heard that all people have one leg that's shorter than the other. Might cause people to lean towards the left or right. Regardless, when it comes to wine, I appreciate your reviews.

Dick R.

Ed, Ed, Ed;

Methinks thou dost protest too much, too gratuitously, and certainly too far afield on subjects about which you know obviously far, far too little!

I certainly don't want to start a pissing contest, but.......

That certainly provides a refutation of my statements.

I protested little, I commented in response to a query, I largely focussed on wine issues (although I couldn't resist a slight US/Can dig) and I listed my credentials.

But, then ad hominem doesn't need to be restricted to such details. You're probably right, I'm just another ignorant provinical in fly-over country.

Ed Rasimus Fighter Pilot (USAF-Ret) "When Thunder Rolled"

......I have visions of Greenpeace style rallys, people in Berets, waving corkscrews & decanters.......

....Even without a MA in poli-sci, I'm enough of a political animal that your position comes through loud & clear, Ed.

....Ed, I would never presume to reccomend. I certainly had a personal prefference in your lates election. Being the USA's largest trading partner, Canada is strongly affected by US politics. Unlike 2000, the winner in your latest election won both the electoral college votes & the popular vote... Textbook democracy in action.

....Sadly, they have done a poor job of all of the above. Lot's of nice tax breaks for their rich freinds & gutting of infrastructure, though. Now, with 6 month till election time, they are 'finding' all kinds of money to re-fund the infrastructure they carpet bombed in the first 6 months of their mandate.

My reference to 'rapid fall' was based on an almost 3 cent jump of the CAD$ against the USD in the few days surrounding the latest election.

.... We have a military???? ;-)

En Vino Veitas Mathew

Ahh, for that kind of a political rally, I would brave the non-drinking Gestapo!

Funny how that works.

Actually most US citizens are pitifully unaware of the textbook process which describes our electoral process. Hence, the innuendo and gnashing of teeth following the last one. Papers this time pointed out that it dates back to '88 before we find the last winner of the majority getting elected. Majority election is a relatively uncommon occurrence in the US.

That happens.

That's why I love this group. Con veritas, mas vino! (More espanol than Latin--the education of the Christian Brothers didn't take as well as four years in Madrid.)

Now that your dollar is gaining strength, you might look for some Colorado wines. The industry is growing rapidly here where we have lots of sunshine, some flinty hillsides and a climate not unlike some of the major European growers. For now, the quality is spotty, but good bottlings do occur with increasing regularity and the price is relatively high compared to equal quality from California and Oz.

Ed Rasimus Fighter Pilot (USAF-Ret) "When Thunder Rolled"

I can't agree, Ed. The US dollar has fallen to an all-time low against the Euro, meaning a fall from 1.16 Eu/$ in June 2001 to 0.77 presently, a loss of

33% of its value. That has had a very noticeable effect on such things as Bordeaux futures, but also has made various European value wines more expensive. For instance, Cotes du Rhones that sold commonly for $8 three years ago now retail for $12. Most of that change can be laid at the feet of the loss of value of the dollar; the rest is likely due to the rising costs of transportation. I doubt that the same wines purchased directly from the producer have changed much in price at all during this period of time.

Mark Lipton

My earlier posting on this issue emphasized high-production, low-priced wines, particularly certain Australian labels that almost certainly have a low per-bottle profit margin. Admittedly not the wines commonly consumed by those who inhabit this forum, but which certainly help pay the rent at wineries that do make such wines. I believe relative currency values have a significant effect on the prices of these wines in the importing country. As one of our Australian posters noted, there is so much of their wine in the "pipeline" now, that they have no choice but to export it. If that results in selling at a loss, then the possibility of "anti-dumping" laws being used becomes real. This is pure speculation on my part and I am open to refutation by anyone who knows more about this sort of thing than I do.

I don't know that I want the Canadian health care system here either, but I want something that is different from what we have now. I want a system where everyone has access to some affordable minimal level of health care. I suspect (tell me if I'm wrong) that, as a retired military officer, this is not a problem that you have to contend with. Don't get me wrong. I don't begrudge you this perk. But show some empathy for those who are not in your position. And it's my taxes help that finance this perk.

[End of OT political commentary]

Vino

It is difficult to ascribe direct causative factors. You may be right, but we might also consider that the recently released 2001 Bordeaux were probably contracted as futures one or two years ago, so current $/Euro exchange may not be as significant a player.

In the last month I've gotten several offerings from Sam's in Chicago who just opened a large new facility in the NW suburbs to augment their near North side store. They are offering lots of French 2001 wines discounted from earlier $10-15 range to $5-8/bottle.

Clearly these aren't huge names or classified growths, but the lead one to consider that the hype for the 2001 vintage caused prices to be escalated beyond what the free market would decide the wines were worth.

All of that being said, my experience over the last couple of years has been that "cult" wines have peaked in the wine market and that there is a huge movement toward very drinkable, quality wines at lower price points. Whereas ten years ago I was arguing that in the US I needed to spend $25-30 a bottle to find a quality wine, I'm now finding lots of great stuff on the market at half of that. Not only have we seen a huge shift from the "all great wine is French" attitude, but we've seen the emergence of loads of new regions that weren't even on the horizon 30 years ago.

Ed Rasimus Fighter Pilot (USAF-Ret) "When Thunder Rolled"

Strangely enough I just posted a comment in this thread that said a similar thing. Much wine currently on the shelves was contracted a year or two ago before the currency variation.

I still contend that media hype for a winery, region or vintage will have a much greater impact on price at the retailer than currency fluctuation (except in periods of huge variations--which isn't really the case today.) And government protectionist policies in taxes and tariffs are certainly a major influence.

Since you asked, you are correct that I have healthcare resulting from my career. But, in contrast to the agreement when I entered service, I now have to pay a premium for myself and family (it isn't free!), when I hit age 65 I go on Medicare, just like every other American, and the service I receive is "space available" at military medical facilities (which are far fewer in number than just a few years ago) or from doctors who are willing to accept Medicare payment rates.

And, it's my taxes as well that pay for my perks.

Ed Rasimus Fighter Pilot (USAF-Ret) "When Thunder Rolled"

Here in Pennsylvania, we are stuck with a Soviet-era system of state ownership of all wine and spirits stores. Back in the early 90's, then-Governor Tom Ridge (now US Homeland Security Director) proposed to sell all state stores to private buyers. This idea was shot down by all of the old bulls in the state capital who didn't want the state to lose all of that revenue. That, or they were just allergic to change. We have an old joke to describe our state government- Q. How many state legislators does it take to change a light bulb? A. Change?!!

Dan-O

snipped-for-privacy@address.com (Dan the Man) wrote in news: snipped-for-privacy@posting.google.com:

But, I did just buy a bottle of the Kim Crawford 2004 SB for $11.99...pointed out to me by the manager of my local state store, who thought I might like it :) (looking forward to opening it!) de

Ed,

What hype? I'd agree that the majority of 2001 Bordeaux were contracted before the decline, but that's exactly why they've always been very reasonably priced. Besides, I've never heard any real hype re the 2001 Bdx. 2001 Rhones, maybe.

The problem with collectable wines comes when there's hype AND currency issues. I've liked the 2002 Burgundies (red & white) I've tried a lot, but buying is limited by skyrocketing prices. And 2003 Bordeaux is priced astronomically. And of course this isn't limited to France- 2000 Barolo/Barbaresco aren't bargains, either.

But as Mark points out, beyond the hype is the "everyday" wines. Classified Bordeaux, 1er Cru Burgundies, Brunelli, etc. always fluctuate due to hype. The difference with currency issues is the effect on the kind of steady modestly priced wines- Cotes du Rhone, German kabinetts & Qbas, wines from Provence, Tuscan workhorses like Santa Christina and Monte Antico, etc. These are the wines that have gone up 10-35% over last year, hype-free.

Dale

Dale Williams Drop "damnspam" to reply

I think you may be making my case for me. Certainly the $ US hasn't declined 10-35% over the last year. We've seen some inflation, particularly with uncertain oil prices and there has been a lot of market uncertainty regarding terrorism and the potential for another cataclysmic shock such as 9/11. But currency fluctuation isn't the principal player in the picture.

What you don't mention is the price war between the US and France regarding a wide range of predominantly agricultural/gourmet products which certainly influences the price for US consumers. I've watched cognac prices climb over the last five years, but at the same time, I've been choosing a lot more Spanish brandies. Single-malt whisky has been steady to even declining slightly if we ignore the emergence of the new fad of flavored barrel and extended age products. (The last three times I had foie gras at a restaurant it was from NY state, not France.)

Burgundy has always been over-priced IMHO and in some measure that can be attributed to pure market forces--supply/demand.

The glass (to maintain the wine metaphor) is way more than half full however. We have seen huge new regions of Europe coming to the fore of international sales and we've benefited from great improvements in US wine producing regions--better product, better availability and better consumer awareness. Australia, New Zealand, Washington, Oregon, Cotes de Roussillon, Spain, Austria, etc. etc.

Ed Rasimus Fighter Pilot (USAF-Ret) "When Thunder Rolled"

Today USD is worth .77 Euro.A year ago today .87. That's about 12-13% offhand. More importantly, 2 years ago the two were roughly equivalent. Last year several wine importers (I think Dressner, Kacher, and Kravitz) stated that they were "eating" part of the currency difference to try to maintain market share, in hope that things would rebound. Dale

Dale Williams Drop "damnspam" to reply

No, but the dollar has lost 32% of its value in almost 3 years.

Cheers

Mike Tommasi, Six Fours, France email link

It's true that there are some knowledgeable folks working at the state stores. My biggest gripe is the lack of competition, which tends to lead to higher prices. At the state border, it is common practice (even though it's illegal) to cross the state line into Jersey or Maryland to get better selection or price. The LCB has tried to combat this by establishing lower-cost stores in several border cities, but unfortunately I don't live that close to the border.

Dan-O

snipped-for-privacy@address.com (Dan the Man) wrote in news: snipped-for-privacy@posting.google.com:

Well, I count myself lucky, I am within walking distance of one premium store and another very convenient by bus - plus the folks at the store one block away from me, though they are not "knowledgeable" are happy to order for me whatever I want that's available...got them trained ;)

I *would* like to see more competition, but in the form of wine stores, I wouldn't buy my wine from the supermarket...the supermarket selection I've seen in other states (mostly Virginia) is nothing to write home about ;)

I'm waiting for the end of the Johnstown Flood Tax, I think it's time ;) they must be dried out by now ;)

TN - that Kim Crawford SB? I thought there was a bit of green pepper to it, I don't like green peppers :P did get a load of grpaefruit, to my taste, but I think I might stick with ?Araucano? which is Lurton, isn't it? for $8.99US in Pennsylvania... de