From WILL PARRISH
If you want to mark a point-of-no-return in the Anderson Valley’s transformation into a full-on satellite of the Napa-Sonoma industrial viticulture complex, as good a choice as any is Duckhorn Vineyards’ takeover of three properties outside of Philo and Boonville in the late-’90s. Founded by a Napa investment banker named David Duckhorn in the 1970s, Duckhorn had by then established itself as one of St. Helena’s most successful vintibusinesses. Wine Spectator put it thusly: “Duckhorn Vineyards’ arrival in Mendocino County… caps the emergence of the Anderson Valley as a prime, Pinot noir appellation.”
In one of the wine industry’s characteristic superficial nods to local cultural artifacts and the natural environment, Duckhorn named its local wine label Goldeneye, after the black and white seaduck whose northward migratory pathway includes the Anderson Valley.
Duckhorn/Goldeneye quickly demonstrated, though, that its expressed interest in cultural heritage extends little beyond its brand name.
In 2000, long-time local resident and Anderson Valley Advertiser contributor David Severn rented an airplane and flew over the expanse of the Valley, snapping pictures and filming video of the landscape located in the portion of hills that are tucked away from view along the valley’s two main highways. The video that Severn packaged together, as Mark Scaramella wrote at the time, revealed “the frighteningly sudden extent of vineyard development and irrigation ponds all over Anderson Valley.”
Severn’s overflight noted Duckhorn/ Goldeneye’s recontouring of the earth on a property just south of Philo, near the confluence of Rancheria, Anderson, and Indian Creeks – where the Navarro River forms. As per the wine industry’s usual custom, Goldeneye was developing a series of large water storage ponds, all of them slightly smaller than 50 acre-feet, which is the cut-off for requiring a permit. After investigating the development further, Severn obtained a copy of an archeological report directly from the vineyard’s manager, Bruce Regalia.
The report, issued by Sonoma State University archeologists, noted the existence of historic Native American sites in the immediate area, including a potential burial site right on the Goldeneye property. One site featured what appeared to be matates and mortar bowls down to depths of six feet. The report recommended that any would-be developers either conduct further study, or else relocate their development to another site.
Goldeneye pursued neither course. Not wanting to deal with the hassle of conducting further study or being restricted in their ability to plant grapes over a portion of their property, the company bulldozed the burial site and built a massive water storage basin right on top of it.
Goldeneye’s purposeful destruction of a profoundly significant historical site of the Anderson Valley’s aboriginal Pomos was nothing if not symbolic. Over the years, the wine industry had demonstrated an utter disregard for the Anderson Valley’s culture and traditions. In the process, it has imposed a dramatic transformation on the Valley’s sociology.
As Severn put it, “When the outside people are the major controlling force in the valley, they establish the housing conditions, they establish the economic conditions, and they determine the land values.”
One visible manifestation of this transformation is, of course, the influx of migrant workers into the valley. As one illustration of the extent of the transformation, Latino students now make up Between 70 and 80 percent of the population in local schools. To the extent that the wine industry continues to dominate, the future of the Anderson Valley will be young, Latino – and characterized by vast disparities in wealth.
In spite of the industry’s mythic “family orientation” (one of three main marketing messages the California wine industry’s trade group, The Wine Institute, recently trumpeted in a newsletter to members), it has done virtually nothing on behalf of the families of its workforce. Goldeneye, among other local vineyards, is known for its magnanimous instruction to its itinerant workers about how to find Hendy Woods State Park campgrounds, the winery supplying no worker housing of its own.
During harvest season, workers camp wherever and quadruple up in Ukiah motels. By contrast, pre-grape farmers always had a quonset hut or some kind of barracks-like accommodations for transient harvest workers, and during the logging boom mill owners threw up mill shacks for their workers. That’s not even to mention the paltry wages the vineyards pay.
The untrammeled exploitation of workers is based in large part on a perverse form of class solidarity cum grape grower communalism. Roederer Estate has acknowledged that it would matter little to the company’s bottom line if it were to build strong worker housing. However, the company’s managers do not want to set a new, higher benchmark for the conditions the accommodations it provides its workers, since other vineyards and wineries might then be compelled to follow suit. Roederer does not want to raise the ire of other growers in the Valley. Thus, no worker housing on Roederer’s grape plantations.
The wine industry’s exploitation of its workforce reflects a restructuring of California agribusinesses’ labor force in general across the past two decades, which has shifted back toward a reliance on undocumented immigrants after several decades of utilizing a more settled labor force. The result has been a weakened basis for union organizing, with the transnational lives of a large part of the workforce being exploited for enhanced leverage and power by the transnational corporations that employ them. In other words, the wine industry’s squelching of organized labor has allowed for the wine corporations to wield untrammeled power. Absent a challenge from organized labor, the big moneyed interests wield total control over the production, distribution, and politics that characterize the industry’s practices. The wine industry would look very different if its workers had more power.
As things stand today, the biggest Sonoma-Napa players in the Anderson Valley wine game are Goldeneye, Kendall-Jackson, and Premier Pacific Vineyards – owned by the infamous William Hill and Bay Area real estate tycoon Richard Wollack. But they are far from the only ones. There is also, for example, Ferrari-Carano Winery of Sonoma, which purchased Lazy Creek Vineyards; Cakebread Cellars of Napa; Londer Vineyards of Sebastpol; Steve Ledson, multimillionaire development tycoon who owns half a city block in Santa Rosa, two wineries, a construction company, several homes, a luxury hotel, a philanthropic foundation, and his very own castle off Highway 12 in Sonoma, and who recently purchased a several thousand acre ranch in the Anderson Valley.
But it turns out that the Anderson Valley is far from the only region of California Wine Country dominated by Sonoma-Napa vitibusinesses. Most other areas of the state’s various premium grape-growing regions are, as well. For example, Santa Barbara County’s vineyard acreage is owned primary by three companies based in Napa-Sonoma: Kendall-Jackson (headquarters in Santa Rosa); Robert Mondavi (St. Helena), which is owned by Constellation Brands of New York; and Beringer Wine Estates (Napa), owned by Foster’s Group of Australia.
Yet, while the North Coast’s two most prestigious wine regions appear on the surface to be at the heart of the California premium wine industry, its financial epicenter is actually located in the second largest outpost of the American banking industry after only New York City: the San Francisco-Silicon Valley metropolitan region. It is here that the wine industry’s two largest historical banking lenders, Bank of America and Wells Fargo, have been based. Silicon Valley Bank is the main lender to smaller winery operations. Large private equity firms like Texas Pacific Group, which has invested in thousands of acres of Napa-Sonoma vineyards at various times over the years, are based there.
Ultimately, if I’ve sought to demonstrate anything about the regional wine industry, it’s the extent to which that industry is integrated into the same decadent economic system that produced the great financial melt-down of recent years. Just as that economic system creates precariousness for a vast majority of the American population, it acts through the wine industry to disrupt the social fabric of the Anderson Valley. Again, Goldeneye serves as a posterchild.
Today, the company is owned by a subsidiary of the world’s largest real estate conglomerate, CB Richard Ellis, by way of a front group called GI Partners, which CBRE set up to manage the billions of dollars in investments it was receiving from public pensions like CALPERS. It is CBRE’s private equity investment arm, known as CB Richard Ellis Investors, that actually runs Duckhorn. The equity it raised to buy out the wine corporation in 2007 came mainly from both CALPERS and the California public teachers retirement system, CALSTRS.
While CBRE, with help from the pension funds, owns Duckhorn, the main lender to the wine corporation is the “financial services” arm of the world’s second largest company, General Electric. Recently, in fact, GE showcased its investment in Duckhorn as part of a national ad campaign geared toward making over the company’s image in the wake of the negative publicity it has received as part of the melt-down of the global banking industry and subsequent federal government bail-out programs. The ads sought to highlight GE’s support for small and mid-sized companies.
(A $250 million wine corporation run by the world’s largest real estate conglomerate, using investment dollars from California’s two biggest pension funds, is apparently GE’s idea of a small or mid-sized company.)
As a reflection of the tenuous structure of the current economic order, it is unclear what fate might have befallen Duckhorn – as reliant as it is on GE investment money – had Congress not voted to bail out GE (one of the too-big-to fail banks that almost failed) in 2008.