Robert Hughes: Art and Money

The art market we have today did not pop up overnight. It was created by the great liquidity of late twentieth-century wealth. Sell a block of shares, shift the money elsewhere. But liquids do not flow where you want them to go unless you dig channels, and this patient hydraulic effort has been, since 1960 at least, one of the wonders of cultural engineering. The big project of the art market over the last 25 years has been to convince everyone that works of art, though they don’t bear interest, offer such dramatic and consistent capital gains along with the intangible pleasures of ownership – what Berenson might have called “untactile values” – that they are worth investing large sums of money in. This creation of confidence, I sometimes think, is the cultural artifact of the last half of the twentieth century, far more striking than any given painting or sculpture. Its origins lie in the mid-1960’s, and although it is hard to assign a single starting-point to a cultural movement so diffuse and international in scope, I think of it as beginning with a curious enterprise called the Times/Sotheby Art Indexes, which created much interest in London and afterwards in New York around 1966.
       These indexes were the brainchild of a public-relations man who had been hired by Peter Wilson, the chairman of Sotheby’s, to spruce up the somewhat fuddy-duddy image of his house; and what they purported to give was reliable statistics on the price movements of all manner of works of art – seicento Bolognese drawings, netsuke, Old Master prints, nineteenth-century animalier bronzes, Chinese porcelain – showing, in an extremely generalized way, how everything was going up by 25 to 200 percent per year. They were short, undetailed, memorable and embellished with graphs.
       Perhaps it was the graphs that did it. They gave these tendentious little essays the trustworthy look of the Times financial page. They objectified the hitherto dicey idea of art investment. They made it seem hard-headed and realistic to own art. From this modest beginning the idea ramified, and for the next ten years it was rare to open an airline magazine without finding yet another excited piece of hackwork puffing the idea of art investment. By 1980 the idea had become so familiar that it was no longer necessary to stress it, and the collector-as-investor dropped out of favor as a journalistic hero; even the dealers felt that such people should not be paraded too much, partly because it seemed a bit vulgar, and partly, I would guess, because prices had already gone so high, and confidence in their continued ascent was so well implanted, that it was time to talk about eternal spiritual values again.
       This confidence feeds and is fed by a huge and complicated root-system in scholarship, criticism, journalism, PR and museum policy. And it cannot be allowed to falter or lapse, because of the inherently irrational nature of art as a commodity. There is no way of coherently discussing a work of art in terms of the labor theory of value, or considering its price as a function of the cost of its ingredients. Paintings are not like hog carcasses or cars or microchips. They do not have an objective value that rises from their material contents. You cannot turn them into something else, or use them to process other things into a different form. Art prices are determined by the meeting of real or induced scarcity with pure, irrational desire, and nothing is more manipulable than desire.
       The market is always converting works of art into passive fictions of eternity and immutability, of transcendent value for which no price may necessarily be too high. When the word “priceless” crops up, the haggling has only just begun. Hence the battered state of the word “masterpiece,” which used to mean a work that proved an artist’s graduation into full professional skill, but now means an object whose aura and accumulated myth strike people temporarily blind and render their judgment timid. It refers more to myths of status than processes of comparison, and that kind of myth-making is the seed of what the New York dealer Ben Heller, in one of the great Freudian slips of recent art history, was heard to call “creative pricing.”
       It is the element of fantasy in the art market, the sense that art prices are so weakly tied to more mundane kinds of economic activity, and that there is something neurotic about them, that gives them their odd lability. The art market can be set pitching and rolling by a single act, which is why it is so notoriously vulnerable to manipulation. A ring of three of four promoters can bid up the price of a dubious young star painter at auction, and although the New York art world may know what’s going on, the collectors in Akron, Ohio, are not so likely to – all they see is the price, which was, after all, publicly bid and duly paid, and is henceforth true.
       A large wine-dark painting by the late Mark Rothko was sold at Sotheby’s some months ago to a Japanese collector for a record price for Rothkos – 1.8 million dollars. It was not merely restored, but extensively repainted. More than a square meter of its original paint was gone, and it had spent many months being redone in that costly Forest Lawn for elderly, battered abstract expressionists run by Mr. Goldreyer on Long Island. Now at the time of the sale there were at least four Rothkos of equivalent quality and historical interest on the New York market, none of them damaged, all priced at around $400,000. If ever a record price was attained by ignorance, this was it. Yet nobody minded; the painting is now comfortably ensconced in some distant tokonoma, and the sale, instead of being seen as a freakish event concerning a compromised picture, doubled Rothko’s prices overnight.
       Something much more dramatic happened with Jackson Pollock’s Blue Poles, which was sold to the Australian government for 2.2 million dollars, more than ten years ago. My fellow-countrymen were rather proud of beating Ben Heller’s creative asking price down from three million. Nobody had even thought of asking so much for a Pollock; but of course the market gratefully rallied behind this heroic example and every Pollock in the world quintupled in price overnight, thus enabling the National Gallery of Australia to announce that Blue Poles was really cheap. The Australian press, in its skepticism, refused to buy this, and the resulting hullabaloo over the price of Blue Poles helped to bring Gough Whitlam’s Labor government down in 1973. But by that time the myth of price attached to Blue Poles was unstoppable. Around 1977 the Shah of Iran tried to buy it from Australia for 8 million dollars; we refused, and the extravagant Shah had to find another way to fall. The moral of such events, the skeptic would say, is that the fair price of art defines itself reflexively. A fair price is the highest one a collector can be induced to pay. Once it is established it shows its fairness by reforming the level of the market.
       The art market today takes its stand on two articles of faith. The first is the dogma of the Perpetual Resurrection of the Dead. It holds that everything old can be revived. The second concerns the Miracle of Van Gogh’s Ear, which teaches the unbeliever that nothing new may be rejected. To say that these propositions might contradict one another is impolite. They do, but it makes no practical difference. Their purpose is to ensure a heavy flow of product for the art market, despite the fact that the supply of good past art is dwindling and the supply of good present art is, to put it mildly, not getting that much more copious.
       Let us look at the implications for historical art first.
       A hundred or 200 years ago, Old Master prices were low – with all exceptions granted – because the supply exceeded the demand. From the attics of ducal homes in Kent to the crypts of churches in Umbria, Europe was crammed with unrecorded, uncleaned, unrestored, unstudied works of art, the raw material for another century of intensive dealing. The number of collectors then, as against today, was tiny. And the support system that we take for granted as a normal part of the landscape did not exist. Few and unsystematic museums; fewer departments of art history and the pensioni of Florence were not full of anxious doctoral candidates swotting up for their dissertation on the size of the Christ Child’s organ in a previously unrecorded predella fragment by the Master of the Bambino Vispo, and whether this holy member signified ostentatio or pudicitas.
       It must have seemed, then, that there was no possibility of the demand for Old Master painting outstripping the supply. The historical deposit seemed as inexhaustible as the herds of elephants on the Serengeti plain. In fact, it was as soon depleted. Our great-grandfathers could not have foreseen what the growth of the museum age would do. And as the major works entered museums, there was more competition for the minor, ones; and then the task of revival and re-evaluation of schools and artists for whom our Victorian forbears had no time at all began in earnest. In due course there would be no schools or artists left to rescue from oblivion. There is no oblivion.
       Today, virtually everything that was made in the past is equally revived: there will be more argument about its meaning and its relative merits, but the universal resurrection of the formerly dead is pretty well an accomplished fact. In this way the disinterested motives of the scholar go hand in hand with the intentions of the art market. To resurrect something, to study and endow it with a pedigree, is to make it saleable. And what is not worth studying for esthetic ends can generally be revived by an appeal to the sensibility of camp. Twenty years ago the word “antique” had an agreed meaning: it denoted something not less than 100 years old. Today it is used indiscriminately of anything made the day before yesterday, like 1940’s nutmeg graters. For those objects which were too ephemeral, ugly, dumb or recent even to pass as modernist archaeology, the word “collectible” was invented. ¥¥
— Robert Hughes, from Art and Money (1984).