How Uptown Money Kills Downtown Art
Artwork by William Powhida
"The art market focuses attention on what its priorities are, which is big buying and big selling—so we wind up talking about Koons, Hirst, Murakami, the usual suspects. The big problem is figuring out how to focus attention in other directions."
Irving Sandler, an 87-year-old critic, has been on the scene ever since New York inherited the mantle of the New Florence from Paris. The author of the definitive book on 1950s American art, The Triumph of American Painting, Sandler witnessed the birth of the big bad New York art market, as well as the periodic waxing and waning of its influence. As I sit in his painting-filled apartment near NYU—"It's all to be given away," he says, gesturing at an Alex Katz portrait of him and his wife on their wedding day, "we decided we were never going to sell anything and we never have"—he pours a glass of wine and schools me on the noxious effects big money can have on young talent.
"Collectors have had an insidious effect on young artists. They move into graduate schools and offer these kids ridiculous amounts of money. The result is that even art students focus on what sells and continue to produce that kind of work, rather than experiment, which is what they ought to do."
I've come to Sandler's comfortable if modest digs to gather some insight from a figure who has seen the New York art market develop into an $8 billion–a-year industry and the preferred recession-time hedge for Wall Street billionaires. I've also come to learn what someone with his acumen makes of the influence of financial speculation on art today—how it affects the way art is made, understood, and, ultimately, experienced.
"Everything has changed, and the art market is a big part of that. Back in my day, people used to fight for their views. Now people look for the auction prices, and the prices are their argument."
A slight, gracious, even-tempered man, Sandler has lived through the art market's various booms and busts and is mostly inured to the wagering and bluffing that characterizes the trade. Yet even he is clearly scandalized by the prices flying around in what looks more and more like a commodities pit. But the scandal isn't the ridiculous amounts of money, or the amount of collective time we spend ogling it. The horror is what happens to the art world when a second-rate drawing like The Scream (not one of Edvard Munch's paintings, mind you, but a drawing) sells for $120 million, what takes place when that ballyhooed transaction, and the piece's subsequent exhibition at MOMA, trickles down into the studios and minds of young, emerging, and even established artists.
"Tens of millions for a drawing? I don't really know how those kinds of prices would affect an artist who is not, as it were, market friendly," says Sandler. "Part of the challenge I see in trying to focus attention away from market-oriented art is figuring out how art that behaves like a commodity can be counteracted by artists. One way to do this is to create communities. Another way—and I think this is very, very important—is to create anti-market polemics."
Oddly enough, that's just what's happened during the last few months in the normally self-satisfied, go-along-to-get-along art world.
"What can I tell you? It's nasty and it's stupid. I'm an intellectual and I don't care if I'm not invited to the party. I quit." That's Dave Hickey, the widely beloved, 71-year-old critic. He made it official as 2012 drew to a close. For Hickey, art has turned into a plaything for the 1 percent.
In a recent bridge-burning interview with the U.K.'s Observer, he portrayed the art industry as "calcified, self-reverential, and a hostage to rich collectors who have no respect for what they are doing." Hickey's whistle-blower account points to a fresh consensus within the art world, a growing belief among insiders that the market is destroying art itself by treating it like shares of Google or Amgen. The whole game has acquired a kind of tacky, Trump Tower uncool: As NYC fashion maven and erstwhile art lover Simon Doonan ranted not long ago in a Slate column about Art Basel Miami, today's art world resembles "a vapid hell-hole of investment-crazed pretentiousness."
Hickey's interview, Doonan's Slate screed, financial writer Sarah Thornton's public spurning of the market in TAR magazine—these and other key art-club defections have one fascinating thing in common: They feature previously sedate experts kicking over the very trough that fed them, calling bullshit on former colleagues and on the rank cupidity, speculation, and insider trading that takes place at clubby lunches at Sant Ambroeus and Casa Lever. Not since the culture wars of the 1980s and the AIDS crisis have such aggrieved righteousness and critical solidarity swept the art world's normally compliant culturati.
That art is, increasingly, a synonym for capital is inarguable. The top of the art market looks like a subsidiary of the NYSE, and art's biggest players today include a disproportionate number of finance's boldface names, from Steve Cohen of SAC Capital and Leon Black of Apollo Global Management (he owns The Scream) to Adam Sender of Exis Capital Management, François Pinault (who owns both Gucci and Christie's), and Larry Gagosian (the financier of art dealers). In recent years, the value of certain blue-chip art has risen faster than the S&P 500, led by a spike in wealth among the country's top earners. Conceptual artist Andrea Fraser, in her essay for the 2012 Whitney Biennial, cites a Yale study showing that "a one-percentage-point increase in the share of total income earned by the top 0.1% triggers an increase in art prices of about 14 percent." You can almost hear the money sluicing back and forth between Manhattan and the Caymans.
Of course, the charge that money is corrupting art has been thrown around since before taxi magnate Robert Scull flipped pictures by Robert Rauschenberg, Jasper Johns, and Andy Warhol into a then-scandalous $2 million profit at Sotheby's New York in 1973. (As Sandler told the story to me, Rauschenberg accosted Scull after the sale and shouted: "Kiss me—I like to be kissed when I'm being fucked!") The Scull sale affirmed the role big money would have in shaping and dominating the art world and, since then, art's principal players have largely adopted (embraced?) Sotheby's auctioneer Tobias Meyer's platinum rule: "The best art is the most expensive because the art market is so smart."
Rank-and-file artists, critics, and curators likewise went along with this free-market piety—although usually with an ironic fig leaf. As the decades passed and the money just got bigger, the overstuffed art beast consumed everything in its path, from Warhol's productized paintings to Jeff Koons's commodity kitsch. (In his book The Value of Art, writer and dealer Michael Findlay identifies this period as dominated by the world's last art movement: Commercialism.) But it wasn't really until serious business journalists took note and came running to document the next hot market for High Net Worth Individuals that the art world took stock of its new situation. And what became clear to the more experimental, contrarian critical community was that what passes for fusion among uptown's financial giants is uranium poisoning for everybody else.
Reuters financial blogger Felix Salmon, for one, has detailed the degree to which the market is kept afloat by vast, dark pools of wealth. In a post called "Occupy Art," he explained the basic data that make possible the anomaly of a skyrocketing art investment economy amid a wider macroeconomic recession, and also pegs how this "flood of money" has begun to negatively affect "the public face of the art world." Over the last few months, Salmon has pointed to nonstop auction records (last November, Christie's and Sotheby's jointly notched a record billion dollars worth of sales in two days), proliferating art fairs (there are 189 worldwide today, up from 68 in 2005), and the art world's increased identification with the mega-rich as just some of the reasons why "the art market has stopped being a source of fascination and crazy numbers, and has started to be a source of sheer disgust."
For an expanding circle of the art world's laboring classes—critics, curators, academics, mom-and-pop gallerists, and, of course, artists—enough finally appears to be enough. Ex–Newsweek critic Blake Gopnik wrote in his very last column in December that "hubris has taken over from sense across the board." But that's too delicate by half. The bad juju emanating from the market is having a Chernobyl-like effect. As The Simpsons' Smithers said to Mr. Burns when asked whether his power plant had killed off a pond full of ducks: "There's no maybe about it, sir."
"Believe me, I don't romanticize poverty at all, but Cindi Lauper was right: Money changes everything." Those words belong to Robert Storr, ex-curator of MOMA's Department of Painting and Sculpture, director of the 2007 Venice Biennale, and, since 2007, Dean of Yale's celebrated art school. Storr has gotten on the phone with me to talk about how "the once comparatively small art market has ballooned into hedgerows of commodities and alternate currencies." A man New York magazine described in 2006 as a "vital link between the museum world and academia," Storr has at times also proved to be a highly contentious figure. As his voice comes over the line, one thing is certain: He hasn't much time for the gaudy big-money players.
"Galleries used to be like record companies. They had artists who sold big, others who sold some, and then still others who didn't sell anything at all. Now that's all changed. Today, every gallery show needs to pay for itself, which means that artists feel increasing pressure to make commercial work. That is not just happening in the art world—the whole world is going corporate."
Despite the growing disgruntlement among his colleagues, Storr is skeptical that any change will come to the system until "some part of the financial game falls apart." When I ask about the possibility of some as-yet-undiscovered local bohemia providing an alternative, he scoffs: "Allan Kaprow announced the end of bohemia in his 1964 essay 'The Artist as a Man of the World.' Essentially, what Kaprow said is that what contemporary artists really want is to become is proper middle-class citizens. Of course, there are moments in every generation when a facsimile of bohemia arrives. There was the Lower East Side in the 1980s, Williamsburg in the '90s, Bushwick now—but those aren't examples of bohemia proper so much as periods of adolescence lived through by successive artistic cohorts."
So much for the Bushwick avant-garde!
But if bohemia is a nostalgic tic, what remain important to Storr are those middle-class citizens. When I mention that middle-market folks are being put under incredible strain by the churn taking place above them, Storr agrees that the art market is an increasingly two-tiered economy. "Of course, absolutely the worst thing you could be in today's art world is a middle-market artist," he says. He then submits that it is in that very middle range—as in the American middle class—that real artistic innovation happens.
"Virtually every gallery I know at the middle says that they're struggling much worse than the galleries at the top or the bottom, because those are the places where buyers speculate." That's Ed Winkleman, the well-known art blogger and owner of Chelsea's Winkleman Gallery. He recently reopened his West 27th Street space after it took on five feet of water during Hurricane Sandy. Despite being in business for years and having a critically acclaimed program, Winkleman struggles with the challenges of running "a family-owned business" in a world that insists on seeing art as an investment. According to the fortysomething dealer, the financialization of art has affected everything—from artists' expectations to what galleries actually show.
"Young artists get carried away by the crazy money out there. They believe the hype. They think success is about endless cash, about having lots of studio assistants, and getting picked up in a limo. As a mid-range gallery, you have to prioritize your spending. Do you spend money on a catalog, which actually helps develop an artist's career, or do you spend it on a limo? Many galleries hire the limo, and I've seen what happens when they can't afford that anymore. I've also watched experimental galleries migrate slowly to show only the artists that sell. Obviously, that strategy only increases the homogeneity of what's on view."
For Magda Sawon, owner of Chelsea's Postmasters Gallery, the distinctions forced by today's speculative market are far more stark: "It's not collecting when someone buys his fifth Jeff Koons for $15 million."
The founder of what many consider to be one of the leading experimental galleries in Manhattan, Sawon describes the current situation as "completely puppeteered from the top" and says it has "tremendous consequences for everyone else." As for the effects of all the investment-grade cash permeating the art world, she is disarmingly direct about what many in the industry are too timid—or conflicted—to say: "It kills radicality for artists, dealers, and everyone else. I think the word collecting doesn't even apply to that kind of activity. It's about buying to sell, really, it's gambling, and has nothing to do with any of the issues that are central to the creation and appreciation of art in our time."
Given that the sort of highly critical work she exhibits—what used to be called avant-garde art—has lost favor among the collectors, Sawon's harsh take could be written off as sour grapes. After all, shouldn't the 21st-century collector have every right to spend money however he likes? Who really gets hurt if billionaires and multimillionaires piss their money away on luxury tchotchkes?
"When money is concentrated among only a few artists and an even smaller number of collectors, then the middle gets squeezed—and that's where a lot of the most important art gets produced." Sawon counters. "Innovation happens in an artist's career where he or she can make advances on initial ideas and before these get locked into signature styles. This is becoming much harder to do, and the result is that art turns more uniform. I'll tell you what I really think—in this climate, I'm pretty sure someone like Robert Rauschenberg could never have made it."
Assuming Sawon is right, we are witnessing the emergence of what might be called Strategic Art—pieces designed to pierce the consciousness of a new investing class. This kind of art increasingly sees the marketplace as a kind of focus group. Naturally, it produces what buyers like best.
"There is so much work out there today that is a literal mirror of the values of the super-rich," says William Powhida, one of Sawon's most emblematic artists and a celebrated gadfly who once satirized Jeff Koons on the cover of The Brooklyn Rail (he's also the artist behind the lettering and portraits in this story). "There are the reflective surfaces of Koons and of younger artists like Jacob Kassay, and there's the sudden vogue in abstraction in the auction houses and the galleries on the Lower East Side. There are suddenly tons of slick-surfaced, object-based works that seem expressly made to sell and never offend."
Kassay, a 28-year-old painter of silver monochrome canvases who set a 2011 auction record of $290,500 for a painting that had sold only a year earlier for $8,000, essentially embodies the speculators' thirst for fresh talent. And while he is duly blasé about their interest in him—"all collectors have is money," he told a New Yorker reporter—it's hard not to wonder how they have straitjacketed him as an artist. Just as important is how these same art-stock traders are transforming what the rest of us get to experience. Take the October auction of Gerhard Richter's Abstract Painting (809–4). A work widely thought to be—like most of the German painter's abstractions—inferior to his far more influential photo-based paintings, it fetched $34.2 million, suddenly making Richter the world's most expensive living artist. Richter himself has called such prices "just as absurd as the banking crisis," "impossible to understand," and "daft." But this process produces more than absurdity; it's damaging to art's own historical priorities. When the mediocre is elevated by speculative greed, the real genius of an artist like Richter is diluted.
"In the current system," Powhida explains, "the rich are really the ones who establish financial and artistic value—instead of artists, curators, and critics. Take Dan Colen's  show at Gagosian, for example. It was universally reviled, but a couple of rich guys thought different, so that work is now not just expensive but has gained institutional traction. That's troubling. Is the system totally rigged? Shouldn't we consider what the price of a work does to art socially and culturally?"
An artist many orders of magnitude removed from the eight- and nine-figure sums that characterize top art prices, Powhida is "incredibly frustrated" by the creative dilemma the market presents to artists. Making critical-minded work while feeling his way through "the problems surrounding art and money," he says, can be paralyzing.
But not everyone gives up. The Bruce High Quality Foundation is a group of Cooper Union grads with serious street cred. The Bruces, as they are known, have taken contemporary art and its larger economy to task on multiple occasions. Indeed, their decision to remain anonymous within the collective (they avoid photographic portraits) is a tactic to stiff-arm the market's star-making machinery. The Bruces also operate an unaccredited art school (the Bruce High Quality Foundation University, or BHQFU) and run The Brucennial, a biennial show that both lampoons and competes with the Whitney's own stolid career-maker. Created to "foster an alternative to everything," this subversive crew, adored as they are, also struggle to find a way to roll back the market's mutation.
"Art has always had a complicated relationship to money, but the fact that money is so prominent and auctions are so newsworthy today is really damning," says one of the Bruces, via telephone. "So, part of the question has to be: How to wrest art back from that kind of banal backstory. For us, it always comes back to one thing: Artists have a quality that makes them different from everyone else in society—and that's chiefly because it's their job to turn their disgust with the status quo into an alternative vision."
Part of the Bruces' vision is to attack the market with a kind of jujitsu. Because they have done extremely well with primary sales, the Bruces are in the rare position of being able to play the game even as they undermine it. They will sometimes agree to exhibitions, for instance, with big-name money-saturated collector-dealers like Aby Rosen and Alberto Mugrabi—as a way to subsidize idea-generating, money-losing projects like their art school; there, they cultivate just the sort of artist who will keep the flame alive.
"What happened, basically, is that the art market did not respond to recessions the way the rest of the economy did. It went up consistently throughout. If you look carefully, the downs don't match the ups at the top of the market, and the breadth of collecting widened rather than narrowed."
Robert Storr and I have met in person this time, over beers and shots of tequila at La Nacional, a hole-in-the-wall on West 14th Street that also doubles as the canteen for the Spanish Benevolent Society. It's the kind of place that was once common in New York before the city was colonized by tonier locales like the Standard Hotel and Soho House. Storr has seen his share of demographic and cultural gentrification. In fact, the curator seems to believe that it is an ineluctable force, like gravity—at least as it applies to art.
"Certain artists and certain dealers were hit very hard in the '80s. The Japanese got pummeled and mostly didn't come back, but they have been replaced many times over by people in Wall Street, the Middle East, Russia, etc. There are tremendous deals that can be had in the art market today that cannot be made elsewhere. These are, by and large, both less traceable and less taxable. Essentially, that part of the art economy has not contracted in the ways that were once predicted by people like myself. And, frankly, I don't think it will."
Storr's vision describes a metastasizing and globalized class of dilettantish oligarch-investors who will do to art precisely what they have done to half of the apartments in Manhattan—cover it in mirrors, lacquer, and logos. There must, one hopes, be another way.
"Saying no is still an option," Storr reminds his people. Just because the rot is pervasive "doesn't mean that artists have no agency or can't say no to the system. Even if the game is stacked against them more than it has ever been, they still have volition."
But as I order another round, Storr lets on that the dilemma may be even bigger and deeper this time. "Art's real problems have nothing to do with Larry Gagosian's legal issues, or the fate of Jeff Koons's or Damien Hirst's prices, or even how some few important artists evade this monster financialization," Storr insists. Rather, they are about "how much of the world's economy is tied up in art investments, and how that opaque economy is actually run. That is the $8 billion question. Ignoring that today and sitting around and worrying about who did what to whom—or things like late capitalism according to Adorno—is just jacking off."
Note: An original version of this story listed Jacob Kassay's age as 29. This has been corrected.
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