Conspicuous Consumption

By Joel Stein

Clarification Appended: November 2, 2007

If you want to understand how quickly the very rich are becoming very richer, don't read about hedge funds, alternative-minimum-tax revenues or acquisitions by private capital. Those things are boring. Look at the difference between the change in the average price of a restaurant meal in the Zagat restaurant surveys and the change in those singled out in its America's Top Restaurants 2008 guide. The price of the average restaurant meal went up 2.3% last year, while the average price at the places that make Zagat's top list went up 3.8%. But if you look at the cities where the very rich live, the dining wealth gap is even wider. In New York City, the price of Zagat's average restaurant meal didn't change at all--up just 0.1%--while at the most expensive 20, it was up 11.1%. In Washington, it's 2.1% vs. 7.6%; Chicago, 3.3% and 6.7%; Atlanta, 3% and 7.8%. If there were a city called Hedgefundville, you'd need scientific notation to calculate the differential.

"Nobody ever complains about it," says Eric Ripert, chef of Le Bernardin, Zagat's No. 3 top rated restaurant in New York City, where the average price of a dinner is $129, up 7% from last year. "The clients tell us we can raise our prices even more," he says. At the BLT Steak restaurants in New York City and Washington, chef Laurent Tourondel is serving a $92 rib-eye steak, and he's pretty sure he's holding back. "I could raise it a little bit more" without losing any diners, he says. "I don't think I'm close to that price yet." When Chicago's Alinea raised the price for its Tour, which comprises more than 20 courses, reservations just continued going up. "You would think that increasing the Tour from $175 to $195 would have an effect on demand, but the overall percentage of Tours we sell on any given night has increased steadily," says co-owner Nick Kokonas. In fact, the restaurant wound up dropping its comparatively cheap $85 prix fixe meal, since no one was ordering it.

It's not just that rich people have more money and no problem spending the equivalent of 400 items off McDonald's dollar-item menu on a dinner for two. Over the past few years, they've also turned paying more into a moral cause no right-thinking chef could argue against: free-range, local, sustainable, organic, hormone-free, heirloom, slow food. As a result, top chefs have had to increase their budgets to find the obscure variety of beet grown only by Shakers or the cow that has been massaged, seen Radiohead live and enjoyed Tantric sex before being slaughtered with love.

Tom Colicchio, a judge on Bravo's Top Chef and the owner of the Craft restaurants in New York City and Los Angeles, says food costs still make up 28% to 32% of an entree's price--only now that means some of his entrees are $50. "The high-end restaurants are looking for stuff made by the small farmer, and this stuff just costs more money," he says. "If you have a small farmer that makes 40 chickens a week, it's going to cost more than a factory farm that's making 4,000 chickens a week."

Food-loving people who don't run hedge funds may have had enough, though. In May the James Beard Awards named David Chang the Rising Star Chef of the Year. His restaurant, the packed Momofuku Noodle Bar in New York City, serves huge bowls of ramen. For $14.

The original version of this article stated that the restaurant Le Bernardin is "Zagat's No. 1 rated restaurant in New York City." Le Bernardin did hold the top spot in the New York City Zagat guide in 2007, but in the recently released 2008 guide Daniel has claimed the top spot.