The Winegrape Octopus
“When at last the land, worn out, would refuse to yield, they would invest their money in something else; by then they would have all made fortunes.”
– Frank Norris, The Octopus, 1901
One of California agribusiness’ oldest traditions is clearing huge swaths of land to plant orchards and vineyards. On the western slopes of the Santa Clara Valley, the newly-arrived class of prospector capitalists felled the dense chapparal and oak savannah to make way for the state’s first commercial vineyard in 1850, as well as the apple, date, prune, and apricot trees. The valley was the west coast’s banner fruit-producing region up to the 1960s. In the 1870s, out-of-towners arrived on the newly-constructed Southern Pacific rail line in the hamlet of Los Angeles, where they cleared the abundant native grasslands and chapparal of the San Gabriel foothills. For many years thereafter, that future megalopolis was the US’ primary citrus growing area.
Massive water diversions have always followed soon after the land clearances. Donald Worster’s Rivers of Empire and Marc Resiner’s Cadillac Desert most famously chronicled California’s damming and moving of prodigious amounts of water, primarily to meet the demands of the state’s much-vaunted industrial farmers.
It took only until the beginning of the 20th century for the majority of the artesian wells in California’s primary agribusiness region, the Central Valley, to dry up. At that point, as the historical geographer Gray Brechin recalls in his classic 1998 book on the decline of California’s natural environment, Farewell, Promised Land: “Pumps took over, dropping water tables and staunching the flow of springs upon which wildlife depended. No longer able to reach moisture, trees, grass, and bushes died, and the soil turned to dust through the age-old process known as desertification. Nonetheless, with the aid of advancing technology, the land continued to yield a phenomenal bounty, the value of which… obscured its environmental costs.”
For at least the past two decades, the leading-edge commodity in California agribusiness’ long-unfolding pattern of environmental desecration and corresponding economic mystification has been the wine grape. An unprecedented period of vineyard expansion is still ongoing; tendrils of vines still go up across vast acreage in the mountains and valleys on the North and Central Coasts. The retail value of the annual California wine grape harvest now roughly equals that of almonds, long the state’s highest grossing agricultural product. Because most of the grapes’ economic value accrues during the wine-making process, however, the end result is that California wine are now equal to roughly 50 per cent of the state’s total agribusiness receipts, or $20 billion.
California has been the US’ largest agribusiness state for more than a half-century running. And wine has become its leading “agricultural” commodity (it is a major stretch, of course, to classify wine as agricultural — as do state and federal regulatory agencies).
The clearance of land and the displacement of water are not the industry’s only ecological price tags. The wine trade also depends heavily on chemicals, pesticides, herbicides, and systemic poisons. Grape prospectors customarily plow down hillsides with the same heavy machinery — D-9, -10, and -11 Caterpillars – that the Israeli military uses to bulldoze Palestinian homes, and that coal miners use during key stages of the process of mountain-top removal in Appalachia.
But there is even more to it than that. While, in some respects, the wine industry has been a short-term economic success, it has been nearly as destructive socially as it has been environmentally.
As numerous long-time local residents have been quick to tell me as I’ve published this ongoing series of articles in the Anderson Valley Advertiser and CounterPunch the local enrichment of the North Coast’s vast wine enterprise has coincided with a general impoverishment of social life in the area of Anderson Valley, characterized by wealthy outsiders who buy up local land and exploit it, without regard to their impact on the existing cultivation. It is also the appellation that commands the highest market prices for its grapes. The valley features one of the most distinctive local cultures in our vast Mendocino county (which has a surface area larger than the state of Vermont): a culture that has been forever transformed by the advent of get-rich-quick grape prospecting, a trend that intensified at the onset of the Grape Rush 20 years ago.
Big Wine’s transformation of the Anderson Valley has not happened in a vacuum. The industry’s local rise reflects larger patterns of economic mis-development, as well as ecological and cultural exploitation, that have been taking place across Mendocino County, the entire state – the entire globe. California is, after all, an integral part of the global economy in countless respects. And California wine is in itself a lucrative part of the neo-liberal economy. Wines produced in this state, including in places like Boonville and Philo, now generate more than $1 billion in revenues overseas.
In the final installments of my series on the wine industry, I am presenting the dark back drop against which the wine industry has developed in Mendocino County, especially the Anderson Valley. What follows here is part one of a modest sketch of the various economic forces, both global and local, that have been responsible for the industry’s economic dominance in Mendocino County and the Anderson Valley alike.
Even now, with the California economy badly in a shambles and the market for premium wines have stagnated, literally thousands of redwood forest acres are under threat from grape prospectors in the Gualala River water basin. The mountains and hilltops surrounding Clear Lake are being rapidly plowed down as grape prospectors hone in increasingly on Lake County, where the local wine-growers association has stated its intention for 8,000 new acres of vineyards to be developed in the next two years. In this context, the history of the Anderson Valley’s takeover by corporate wine interests serves as both an important part of understanding social relations in the valley during the present, as well as a cautionary tale aimed at anyone attempting to ward off a similar fate in their own watersheds and communities.
Rich Ag, Poor Communities
In 1937, a Berkeley anthropology student named Walter Goldschmidt published the most oft-cited study of the social impacts of industrialized agriculture. Comparing a Bakersfield exurb surrounded by the massive Kern County Land Company to a small town south of Fresno encircled by small family farms, Goldschmidt detailed how the family farm community had far more vibrant social institutions and a better quality of life. His basic insight is common sense if you are, say, someone who is involved in Mendocino County’s various sustainable foodshed groups. Because of what it implied about the structure of American agribusiness as a whole, however, it was was greeted with tremendous resentment within academia. In short, agricultural land baronies, agribusiness corporations, and out-of-town prospectors destroy the texture of local social life. Small-scale agriculture, on the other hand helps to facilitate it.
The family farm community in Goldschmidt’s study was also far better off financially, owing to the tendency of small local farm owners to kept their profits circulating where they live.
Contrary to the romantic myth of small-farm wine craftsmanship, the wine industry is not small-scale at all. Rather, it is dominated by that most corrosive of all social forces working to undermine: big capital. The largest private equity firm on the planet, Texas Pacific Group of San Francisco, has been one of the three or four biggest players in the Napa and Sonoma wine games for the past 15 years. A subsidiary of the world’s largest real estate firm, CB Richard Ellis (also of San Francisco), owns one of the very largest wineries in the Napa and Anderson Valleys, Duckhorn/Goldeneye. The world’s largest agribusiness lender and fifth largest American company overall, Bank of America, holds the mortgages on far more California wine-grape estates than any other investment firm.
In addition to the investors, there are the land barons. E&J Gallo and Kendall-Jackson respectively own tens of thousands of acres across the state, as well as, in Jackson’s case, numerous large vineyards in other countries. The Napa Valley’s Andrew Bescktoffer is the biggest owner of grape acreage in Lake County, the second biggest in Mendocino County, and among the five biggest in Napa County.
Regardless of who, exactly, is growing the grapes, the industry as a whole is dominated at virtually all levels by big corporations. For instance, a mere seven companies purchase 82 percent of the wine-grapes grown in the United States. They also control the infrastructure. Altogether, this structure ensures that the big growers retain an even greater share of the profits.
The Anderson Valley fits Wine County’s prevailing economic trends. Roughly eight years ago, one-time AVA publisher and long-time columnist David Severn published a study regarding vineyard ownership in the valley. About 82 percent of vineyard acreage was owned by people who live outside the Anderson Valley at the time. An overwhelming portion of the county’s grapes are sold to the seven big wine corporations.
The Globalization of Wine and the Anderson Valley
In the mid-1970s, the American wine industry finally cast off the low-rent image that had dogged it since the darkest days of Prohibition. Napa Valley wines began earning accolades at prestigious international tasting competitions. For California’s fledgling vinters, a sort of economic renaissance kicked off.
Industry executives made a conscious effort to appeal to the consumer sensibilities of that growing population of middle-class, ex-hippies fanning out from the West Coast, intent on reconstructing their identities around more socially acceptable forms of what constitutes the Good Life.
Meanwhile, the San Francisco-based Wine Institute hired a polished former State Department official, Hoover Institution fellow, and University of California professor named John De Luca to oversee its image overhaul, as well as it planned economic expansion. Under De Luca’s guidance, the Institute even began playing a role at international trade negotiations, including talks on the General Agreement on Tariffs and Trade (GATT) and the North American Free Trade Agreement (NAFTA). One benefit to these maneuvers was the message they sent to potential investors: In the context of a new era of globalizing capital, California wine was developing into a big, respectable industry with global aspirations.
Further, a major benefit to the increase in respectability was that Europe’s profoundly image-conscious wine barons began to invest in the North Coast appellations, which were becoming increasingly profitable for those with sufficient capital and knowledge. One of France’s oldest and wealthiest wine families, the Roederers, were among the first Old World vinters to prospect for the right California soil and terroir. They found what they were looking for in Philo, where they established the Anderson Valley’s first corporate winery in 1981. Today, they own roughly one-fifth of Anderson Valley’s cultivated grape acreage.
Until then, the Valley was dotted with merely a handful of vineyards and a single winery. Though the local wine industry was responsible for some ecological damage (a comparatively small amount), the culture surrounding the local wine industry was loose and informal. As former Elk resident and regular Anderson Valley frequenter Roanne Withers (a highly accomplished local environmental activist), recalls, “There was always work in the vineyards. And white hippies worked right alongside the Mexican migrants. It was fun.”
As David Severn put it, Roederer proved to be “the pioneer wine colonizer” in the Anderson Valley. Largely unknown as a grape-growing region prior to the arrival of the French grape barons, the valley was suddenly on the map as a likely next-big-thing among Napa Valley grape prospectors. A mini-depression hit the wine market in the mid-’80s, slowing investment and delaying for a handful of years the rush of grape prospectors who would soon flood the Valley, eager to exploit the infusion of prestige Roederer had provided.
One indication of what was to come was that a San Francisco attorney-turned-Lake County grape grower named Jess Jackson bought out the Anderson Valley’s original winery, Edmeades, in 1988 – Jackson’s first purchase of a winery, as well as an instrumental step in his later development into the industry’s leading robber baron.
As investment money flowing in more readily in the early-’90s, the grape prospectors grew bolder. Growers in Napa and Sonoma had rediscovered the possibility of growing grapes at higher elevations, in cooler climates, where the sugars were more concentrated. Soon, big investors began directing their capital toward creating a mountain-top removal vineyard planting binge. The pioneer of this alliance of big grape prospectors and large investors was a Stanford MBA named William Hill, a Napa Valley vinter since the late 1970s.
In the mid-1980s, Hill embarked on perhaps the most audacious mountain-top vineyard project that had yet been attempted in Sonoma County, in an area called Foss Valley, near the Alexander Valley and not far from Geyserville. Eager to exploit the rocky, well-drained soils that the mountain promised, Hill brought in a phalanx of D-9 Caterpillars to dig out a deep contour and install a veritable lake at the top of the mountain. From there, the bulldozers attempted to rip apart the various ridges of the property. Unable to excavate the numerous clusters of massive boulders from beneath the top-soil a D-9, the Hill development team resorted to a brand-new brand of bulldozer, the D-10, that was two and a half times larger. The mechanism was so huge that its components needed to be delivered in multiple stages, with one truck pushing and one truck pulling the components, just to get it up the hill.
Ultimately, Hill’s team succeeded in “ripping the place up.” Hill’s team successfully developed the vineyard, though not without washing a massive amount of sediment into the local water basin. It was the rosy dawn of a new era of vineyard prospecting. Hill quickly sold the estate to a large Italian wine combine, then turned his focus to his next major development scheme. The entire feat – both the engineering of the vineyard site and the subsequent sales job – had been sufficiently impressive from a strictly capitalistic perspective that Hill had no trouble securing funding from the British conglomerate Allied Lyons (later Allied Domecq, now part of Constellation Brands) for that newest major project, a development on a 1,400 acre parcel in Peachland, above Boonville in the Anderson Valley.
Like War-Time Laos in Peachland
In the spring of 1991, William Hill introduced the practice of mountain-top removal grape prospecting to Mendocino County. Allied Lyons had agreed to buy out his wine brand on favorable terms if he were able to develop his Peachland estate at a profitable rate. So Hill’s large bulldozers rumbled up the road, whereupon they commenced to scrape every bit of vegetation possible from a vast expanse of the land. From there, they deep plowed the soil in various designated planting areas to depths of at least eight feet, if not greater.
Hill’s workers then ignited a huge bonfire with the uprooted Peachland trees and vegetation, which could be seen all over the Anderson Valley and into the Ukiah Valley for 24 hours afterward.
One of the North Coast wine gentry’s most prescient and tenacious Advertiser.critics is Bruce Anderson, editor and publisher of the Anderson Valley er. Shortly after Hill’s project commenced, Anderson led off an issue of the AVA by sounding the alarm not only on Hill’s specific project, but the destruction it portended for the Anderson Valley as a whole.
Noting that the Valley’s land and hydrology were “coveted by more and more people with more and more money,” Anderson summed up what continues to be Hill’s basic modus operandi: “The enormous bonfire, ignited without alerting local fire agencies, served as a sort of metaphor for Hill’s flaming contempt for the environment and the people responsible for defending it. The fire perfectly sums up the man’s approach to land development.”
In a harbinger of the wine industry’s later activities in the Anderson Valley, Hill carried out the development without bothering to gain a single permit. The sole California Water Rights officer who was able to access the property had ordered Hill to stop. Not wanting to get bogged down even in California’s minimalistic regulatory process, with its customary leanings toward the interests of big business, Hill openly flouted the order. He had a lucrative deal with multi-national conglomerate on the table – and, thus, no time to lose.
The Water Rights Officer, a veteran of the Indochina wars of the ’60s and early-’70s, told Anderson that Hill’s Peachland development reminded him of war-time Laos. "It looks like a combat zone up there," he said. "I haven’t seen destruction on this scale in a long time."
Ultimately, Hill completed his Peachland vineyard development in 1991. Allied Lyons did, indeed, buy out the William Hill Winery brand in 1992. Four years later, the parcel was bought out by its present owner, Kendall Jackson.
Hill’s project was never subject to any sort of organized opposition in the Anderson Valley, in spite of the efforts of a small handful of residents. On the general principle expounded by Frederick Douglass, the lack of resistance did not bode well for the future ecological well-being the region: “Find out just what any people will quietly submit to and you have found out the exact measure of injustice and wrong which will be imposed upon them.” And, by extension, the bioregion where they live.
WILL PARRISH can be reached at wparrish(a)riseup.net.
This article is part of WILL PARRISH’s ongoing series of on Northern California’s highly destructive corporate wine industry.