• The Art World Doesn’t Want Us to Ask Where the Money Comes From

    Barbara Bourland on Value and Excess in the Art Market

    In May, a record was set for the most expensive work by a living artist: $91.1 million for Rabbit, a mirror-finish stainless-steel sculpture of an inflatable plastic bunny created by Jeff Koons in 1986. A few days later, Roberta Smith, the co-chief art critic at the New York Times and one of the most influential critics in America, implored us to “Stop Hating Jeff Koons” over this and any other sales records because “Money is always around art, but it has nothing to do with the making of art, the cherishing of art or the wisdom of it.”

    Such a statement—that we should discount the role of capital in artmaking—is old as dirt and just as pervasive, rhetorical propaganda crystallized from the diamond vein of elitism that rises beneath every landscape to separate the haves from the have nots. “It’s been embedded in us that’s it’s taboo to think about the economic value of the work, that it somehow has an inherent mystical value,” sculptor David Brooks (a source for the research for my second novel, Fake Like Me) told me recently. “It haunts a lot of [my generation’s] works. My own way of dealing with it has been to work outside of the commodifiable object to emphasize the structures of value.”

    This view has been embedded in us by dealers, critics, and older artists, and it’s time we discarded it completely. To insist that “money has nothing to do with the making of art” is both to express a deliberate mischaracterization of artmaking and economics, and to intentionally alienate us from those who do not have to think about money. The global financial systems that govern our stability—currencies, retirement funds, real estate, and of course, the niche markets that control creative economies—have an enormous impact on us and an outsize control over our lives.

    While it is not a surprise that Smith needs to believe that “money has nothing to do with the making of art” in order to participate in the classist ideological economy of the art market in which she is an invaluable cog, it is a huge surprise that she would do so in a column devoted to Jeff Koons. It is also, weirdly, a gift; it is rare that someone in power will say so explicitly the thing they need us to believe.

    As Smith is doubtless aware, Koons’ work is explicitly about commodification and capital. After Damien Hirst, there is no bigger living name that would come to mind when discussing the intersection of art and money. Not only is the work itself made from mass-produced commodities—toys, vacuums, pressure cookers, advertisements, flowers, sports, it goes on—but his foreman-as-artist process is famous for its separations of labor and ideas. At its height his studio employed up to 80 people and contracted fabrication through fine-arts production facilities in California and Germany.

    The original Rabbit sculptures were sold for $40,000 apiece; not a lot of money, perhaps, compared to $91.1 million, and yet—it is still a lot of money, and the rising market value of the Rabbit series, as reported in the recently released BOOM: Mad Money, Mega Dealers, and the Rise of Contemporary Art, by Michael Shnayerson, stands in direct correlation to Koons’ later ability to raise at least $30 million in capital from dealers Jeffrey Deitch, Anthony d’Offay, and Max Hetzler (and eventually, Sotheby’s auction house and dealer Larry Gagosian), to underwrite the speculative production of his Celebration series, which included the four Balloon Dogs, large scale-relatives of Rabbit. The Balloon Dogs sold in the primary market at $1 million each and cost at least $250 thousand apiece to fabricate. The most recent Balloon Dog sale in the secondary market was for $58.4 million in 2013; H&M then issued a series of Balloon Dog handbags in collaboration with Koons, priced at $49.95.

    Money is part and parcel with the making, cherishing, and earned wisdom of a successful art career, particularly that of Jeff Koons, yet there has been no critical response to Smith’s argument, a genuine surprise in the age of content creators mercilessly seeking easy targets. Instead it has remained there, flapping in the wind on its own petard, while leading art magazines have said nothing to controvert her stance.

    Two simple reasons, mutual and not exclusive, come to mind for this lack of response: one, perhaps nobody cares, as Smith is maybe useful only for her hype (this is a critic who refers to painting itself as having a “macho bravura,” so I get it, who gives a shit), and/or two: some secretly believe she is right.

    The history of contemporary art is still being made, and art is, as Sarah Thornton wrote in Seven Days in the Art World, about “experimenting and ideas, but also about excellence and exclusion . . . The art world is so diverse, opaque, and downright secretive, it is impossible to be truly comprehensive. What is more, access is rarely easy.” Even those in power find themselves without clarity. “There was a lack of literacy among experts on the financial workings of the business,” Sotheby’s Amy Cappellazzo told Shnayerson of arriving at the only publicly-traded auction house.

    To insist that “money has nothing to do with the making of art” is … to express a deliberate mischaracterization of artmaking and economics.

    Thorton, Shnayerson, and others, like Mary Gabriel (whose extraordinary Ninth Street Women is required reading for anyone interested in art after WWII) are making their best efforts to transcribe as much of this living history as they can. Popular nonfiction is easily derided for its lack of academic rigor (see recent criticism of Jill AbramsonNaomi Wolf and Jared Diamond), patently obvious subject position and bias, and tendency to elevate the voices of the powerful over all others (Shnayerson’s book has a blurb calling it a “400-page Vanity Fair article; this is accurate). Artists and writers, who deal in nuance, tend to dismiss books intended for a much broader audience. But popular nonfiction nonetheless works to illustrate the corners of the world we cannot always see, and regardless of its problems, we, as artists and writers, have much to gain inside these pages. There is so much to know about how those before us came into their success and how the powerful work to exploit that success, information we must know in order to forge our own careers.

    A caveat: much of BOOM is riddled with sexism that explicitly diminishes women’s accomplishments. Elaine de Kooning, for example, is referred to as “vivacious” and “passionate” but not as a painter; her portrait of JFK hangs in the National Portrait Gallery. Other women are described as “mother” (the first descriptor of dealer Marian Goodman), “wife” (the first description of both Lee Krasner and Helen Frankenthaler, though Frankenthaler was not even married to Robert Motherwell during the period being described), “very pretty girl” (artist Louise Lawler), “a beautiful woman, fine-boned” (Mary Boone), “delicate Japanese beauty,” (artist Yayoi Kusama) and so on, while men are defined first by their professions and elevated with descriptions like “commanding,” “broad,” “panther-like” (Larry Gagosian) “fascinating,” (dealer Samuel Kootz) “rangy” (David Zwirner) “boyish” (Iwan Wirth), etc. I mention this because the sexism is itself a vocabulary in the secret language of elitism—and as such, is part and parcel with the best of the book. It shows us what kind of attitudes open doors, and for whom.

    The book’s original research—interviews with dealers Arne Glimcher, Larry Gagosian, Iwan Wirth, David Zwirner, Gavin Brown, Jeffrey Ditch and Marian Goodman, among many others—delivers valuable anecdotes about how dealers, museums, and collectors perceive and structure their interactions with art and artists. First and foremost: as an investment. In BOOM, we learn that art is not classed as a financial asset, and so it goes ungoverned by financial regulations. Market prices can be set with no money exchanged and no tax obligation: one dealer has a Warhol for sale, previous sale at, let’s say, $1 million. He sets the auction minimum at $10 million; dealer two buys it for $10 million. The record of value is set. At the same time, dealer two sells a similar work, from the same period, in a private sale to dealer number one, for the record-set price of $10 million. The net change is $0, but they have created, for the public record, a $10 million-dollar value for each painting. This is called a 1031 like-kind exchange. With the support of a major auction house and a like-minded partner in what is legally not a crime, it seems that anyone could drive up the value of an artwork, or an artist.

    However, it’s not easy gaining the support of auction houses and other dealers without the right CV, one that invariably must include a major museum show or five. Museums only work with a select group of dealers; they don’t truck with smaller galleries. “We need a well-organized gallery that has proper files, good images—a gallery with great records that can be a good coworker with us,” Guggenheim director Richard Armstrong told Shnayerson. Galleries are generally asked to pitch in at least $5,000 and up to $200,000 to help a museum mount a solo show, to pay for the catalogue, the advertisements, the opening night dinner, everything but postage.

    “Certainly this can be onerous and complicated for many reasons, including potential conflicts of interest,” Angela Westwater of Sperone Westwater told the New York Times in 2016. If you were dreaming that the right person might walk into your friend’s pop up gallery and put you in a museum show—think again. The money is simply not there. You’ll have to be appended to a powerful dealer first; better still if you are dead, the supply of your work finite.

    At museums, board members learn about upcoming shows two or three years ahead of time; there’s nothing to stop them acquiring work with that insider knowledge. The museum employees might acquire, too, but they likely don’t have the same wealth that the Lauder, Bass, Rockefeller and Ovitz families possess, to name but a few members of the board of the Metropolitan Museum of Art.

    Once the work has become valuable, it is the ideal vehicle for money laundering. “Here’s one being done mostly in London,” one (unnamed) art dealer explained to Shnayerson. “The deal is you buy a mediocre painting for, say, $200,000. Then you doctor the documents so that the selling price appears to be $1,200,000. Then you get insurance on the painting for that inflated price. And then you go to the bank to get a loan based on your $1.2m-artwork as collateral. Maybe you do that with not just one artwork but eight or ten, gathering bank loans for altogether eight or ten million dollars. And with that you can actually build a building!”

    More commonly, art is a luxury good that remains easily untaxed. Art is legally sold to residences in states without sales tax, then relocated on private planes to states with sales tax, the authorities none the wiser. It also spends time in “free ports,” large warehouses at airports in Geneva, Zurich, Beijing and Hong Kong (and now one in the city, in Harlem), which suspend all taxes due on the art as long as it remains in free port storage. It can be sold there, viewed, traded, with neither sales tax nor capital gains.

    If a collector prefers to see their own art, however, they may simply open their own museum, with open hours to the public available by appointment. There are, according to BOOM, over 266 private museums around the world accruing the same tax protections as the Met or the Guggenheim—and if those museums acquire enough prestige, further influence over the market at large.

    We are, all of us who sell our work, commercial. We are all of us in the market.

    In the face of such a cabal of oligarchy—none of these actions are being executed by the middle-class—and a genuinely dehumanizing financial system, how can an artist even continue to work? By intervening in the financial process as often as possible, and exerting control wherever they can find it. BOOM provides a series of invaluable anecdotes about artists interfering. Agnes Martin told her longtime dealer Glimcher: “Remember, we are toilers together in the art field, but we are not friends.” Later, she would call him to Albuquerque on a day’s notice, show him 12 paintings, and ask which two he liked. Shnayerson writes, “With a sigh, [Glimcher] would pick two. Martin would slash the others with a matte knife.” On her deathbed she asked him to visit one last time to help destroy two final unfinished pieces. He obliged. After her death, several new works, meant to be destroyed by an unscrupulous assistant, reached the market. Glimcher, to his credit, took seriously Martin’s requirements for a “finished” painting—if the paint pooled anywhere on the canvas, leaving a small puddle, it was to be destroyed—and his gallery, Pace, has refused to buy or sell those puddled works still in circulation.

    Mark Bradford required his galleries to support his nonprofit Art + Practice, and secured at least $4.4m from Hauser+Wirth and $1.4m from White Cube, in London, and later instituted a “buy two, get one” policy, requiring collectors to donate the second work to a museum. Joe Bradley still sells one painting a year through his friends at the small gallery Canada, and refuses to agree to any other arrangement, even with Gagosian. Maurizio Cattellan asked his Paris dealer Emmanuel Perrotin to wear a bunny suit for six months in order to secure their relationship. Julie Mehretu required payment in full before beginning work on her large painting for the recently refurbished SFMOMA lobby—a small intervention, perhaps, but a meaningful one. And in earlier days, Pollock and Stella, among others, both lived on stipends from their galleries in an advance on sales—much like the publishing industry.

    Art has entered the publishing industry, too, as the larger galleries (Zwirner, Gagosian, Hauser+Wirth, Shainman, Pace, Marian Goodman) have in the last decade developed their own publishing arms, creating catalogues, artists books, and monographs from their own armies of academics and journalists, alongside digital platforms like Art.sy, an auction site with a side business in cultural content. The purpose? To manufacture the prestige required to build up the value of artworks like Rabbit.

    The financial workings of the art world are endless, and endlessly fascinating. Artists and writers have much in common: We make the product, and the product is sold through a global system (according to Shnayerson, the 2017 global market for art was $63.7b; in 2018, the global market for book publishing was $112.2b) in which it is difficult to gain power. The fundamental elitism of both industries does not want us to ask questions about money; art doesn’t want us to ask where the money comes from (consider how long it has taken for backlash against the Sackler family to take root, or Anand Girihadas’ recent story about a last-minute gig at a private Manhattan club, ending in his astute advice to “Never underestimate the defensiveness of very rich people who believe they’re progressive and who are willing to give back in any way they can—except by surrendering any of their privileges, advantages, or immunities.”).

    Publishing’s forced categorical separations between literary and commercial explicitly defines a line between intellectualism and finance: if you are smart enough, erudite enough, you’re not supposed to openly aspire to having an audience. Yet—we are, all of us who sell our work, commercial. We are all of us in the market. And though with each new thing we learn about capital, we may feel even more acutely powerless, I say: swallow it and keep going. If we are not even awareof how the markets work, we have no hope of changing it to our advantage. Don’t allow those in power to shame you into believe that observing capital is not in your interest. Money matters, to every single artist and writer; it’s how we pay our rent, our healthcare, and for the time we need to make our work. It will never stop mattering.


    Barbara Bourland’s novel Fake Like Me is out now from Grand Central Publishing.

    Barbara Bourland
    Barbara Bourland
    Barbara Bourland is the author of Fake Like Me (June 18, Grand Central Publishing), in which a young, no-name painter worms her way into the inner circle of a group of enigmatic artists—and uncovers the secrets they thought were long hidden. Her debut novel, I’ll Eat When I’m Dead, was published in 2017.

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