THE 'REALPOLITIK' OF SELLING VISUAL ART
© Donald Richardson, March, 2005
Increasingly since the nineteenth century, artists have chosen to express themselves freely as individuals. Consequently, they have usually operated outside any system of
patronage - which means that they have had to sustain themselves financially by selling their products as commodities on the open market. In fact, selling works of art in this way is a paradigm example of laissez-faire trading - with all its well-known disadvantages to the producer. As with all primary producers, artists create products without any real assurance that they will be marketable at a price sufficient to sustain further production and, even, the lives of the producers and their families. In drought years, Australians are very familiar with this phenomenon as regards farming; in the arts the situation is always with us, regardless of the season.
Few realize that some of the artists who have operated under this system and became famous actually had private means (Degas, Toulouse-Lautrec, Drysdale); others had supportive spouses (Monet, Matisse, Conder). The fortunate, highly-talented few were taken up by enterprising commercial gallery operators who became their dealers and managed the marketing of their products for them - for a retainer or commission. Only the exceptional cases died wealthy: most true artists struggle all their lives to keep body and soul together. No one is happy about this: it is just an undeniable fact of the life of artists.
But, both the commercial gallery system and the state and national galleries conspire to keep the reality of marketing art as a commodity from the general public. The aura of wealth, pleasure, high prices and conspicuous entertainment and consumption they project is misleading. The world sees an artist receiving $10,000 for a single work, but does not realize that he/she will probably net only about half of that.
A painter who sells a picture from a commercial gallery for, say, $1000 probably paid $200 for the frame and will have to pay between $330 and $500 commission to the gallery (after having contributed a considerable sum for printing the catalogue and for victuals for the opening and, perhaps, a preview). This leaves a net return to the artist of between $470 and $300 (but only, of course, if the picture sells!). On this the artist will probably have to pay 10% GST and - if his/her income for the year reaches the taxable minimum - income tax. Insurance also is the responsibility of artists, if they can afford to buy it. While galleries have public risk policies, these do not cover any damage a work may suffer while on exhibition or in transit to/from the studio. Neither does it cover any harm a work may cause to a spectator, as when a picture or sculpture falls on him/her - a fact few artists are aware of.
And a one-person-show can take up to five years to paint - if the artist is able to devote full time to it, not having to teach or pursue some other means of earning an income. Thus an artist will have to net $200,000 from a show to average the modest income of $40,000 per annum over the five years. This means that the show will have to gross at least $350,000 in sales - a very rare event indeed! Consequently - except for those who have established a reputation and can sell their products at a reasonable price - artists usually live their entire lives in poverty.
Objective or rational methods of determining the monetary value of a work of art are bound to fail because there is no 'natural' equivalence of aesthetic and monetary values. Nor is it possible to estimate the sale price of a work of art by the time it took to create it (as, for instance, plumbers price their work) or the preciousness of the materials used. A piece of paper which was coloured by JMW Turner in an hour or two is worth more than many a solid gold trinket.
There are several major - and many minor - art prizes on offer in Australia each year. If an artist is lucky enough to win one, for that brief instant he/she will accrue a one-off $1,000 to $50,000 (on which, of course, tax must be paid). Luck does come into it because there are commonly hundreds of entries, many of them of high quality, but only one can win - and this at the whim of the judges, who are often not well qualified in the field . And each artist entering will have to pay a fee of up to, perhaps, $40 per entry and spend many dollars having works photographed for pre-selection and on freight, insurance and packing if the work is selected for judging. For those whose annual income is less than the taxable minimum these expenses are an unrecouperable loss.
And artists are expected to take part in those weekend exhibitions which are in support of worthy causes. Sometimes these, too, charge entry fees and prices are expected to be minimal. Artists have to frame and transport their works at their cost, but there is little chance of worthwhile sales within the two or three days such an exhibition typically lasts.
It takes years for an artist to generate worthwhile prices for his/her works. And this can be inimical because it requires that an artist develop a recognisable 'brand' style early in his/her career, whereas the natural thing is to progress through 'periods' to maturity in late middle age. It can be commercial suicide to move, however creatively, from one style or medium to another. The result is that some of the best artists, judged on aesthetic criteria, are some of the lowest paid practitioners. Only in the minority of cases - usually now aged artists who fought, in poverty, to establish Modernism in the post-World War II period - are now well off .
The enormous prices paid for the works of famous artists - the Nolans, Drysdales and Olsens - at auctions are not paid to the artists or their heirs, of course. These prices - obtained on what has become known as 'the secondary market' - are tens or hundreds of times the few guineas the artists received for the works when they sold them. The profits of these sales go entirely to the marketeers, and this will continue until Australia adopts a system of resale royalty, such as operates in some countries. However, moves towards such a scheme are being opposed vigorously by the secondary-market industry.
Art does not sell itself, whatever the price. The Nolans, Picassos and Turners of this world were - frankly - promoted in the market-place by friends, enthusiasts or dealers . When the work of a new artist of worth comes on to the market, prospective purchasers (apart from the most experienced and sophisticated) wish to be told something about the artist's intentions, working methods etc - and to be assured that any 'courageous' choice they may make will not be ridiculed by the more experienced. This is the role of the commercial gallery director or dealer.
Thus, the 'realpolitik' - for artists - of selling art as a commodity in a market economy.
The public's total ignorance of all this can only be remedied through education, but arts education is devalued in our system currently. This is, of course, a self-perpetuating problem: generally our educators - at all levels - know little about the arts, so they are unable to teach their students about them. And so it goes on, generation after generation! The Myer Report has been criticised for ignoring this. At least it could have recommended the revival of the excellent 1995 report of the Senate Environment, Recreation, Communication and the Arts References Committee - which died when the government changed soon after its release. It is a national disgrace that this exemplary, land-mark, report was allowed to lapse into oblivion. Many of its recommendations are still vitally relevant .
Remuneration for artists
It is a tragic irony that the art market is parasitic on impoverished artists - without whose work it would (could) not even exist. Of course, artists choose their life-style (and, therefore, their economic status) freely and willingly - just as some farmers choose to live on unprofitable farms. Governments have schemes for supporting farmers in economic need, but not artists. But creative people are an asset to any culture and it is incumbent on government to ensure that they don't starve to death in the garrets of King's Cross and St Kilda - or give up trying to exist as artists. Bernard Smith, lamenting - in The Age of 18 March this year - the 'dirge-like development of Australia's cultural life', designated art as a 'moral imperative'.
Patronage has always been rare in Australia and only artists who have some track-record in producing marketable things are patronised. This is certainly the case with the Australia Business Arts Foundation (AbaF), an outgrowth of Paul Keating's 1995 Creative Nation concept. This government-subsidised association of businesses supports the arts through partnerships, not patronage per se, so it is only interested in major performing companies and established artists - from whom some return on investment can be expected. It is extremely unlikely that it will ever support some promising youngster as the Medici did the young Michelangelo.
This means that, if the country considers the arts worth having, some form of government patronage is necessary. Australians are reluctant to realise that there has been never been an era of significant arts development that was funded by market forces.
If the government were to take on this responsibility, intervention should be effected first in the training of teachers and in curricula. By ensuring that every school - primary as well as secondary - has on its staff teachers trained in the arts a population which valued the arts would gradually emerge. This would take some years, but the investment of human and financial resources would ultimately be well worth it .
The logical way for a government to patronise artists is to allow them to qualify for 'work for the dole'. Artists are prepared to live frugally in order to be able to practice, and true artists could rarely be labeled 'dole bludgers' because most actually work longer hours and with greater dedication than people in other employment do.
Artists create precious objects - and, thus, wealth - out of common materials. To some, this is equivalent to the honest toil of the labourer and peasant . But we should recognise that, in the days when work was more clearly divided into manual and professional, art was considered to be of the latter - which was indicated by its products being priced in guineas, as were those of architects, medicos and lawyers. Thus, it is relevant to speak of the 'professional status' of the artist.
In Australia these days, most artists have tertiary qualifications but many graduates actually achieve little in the field; on the other hand, some artists gain professional recognition with few or no formal qualifications. Thus, professional status in art has no necessary relationship with formal training.
So, the problem for government in allowing artists to receive the dole will be to distinguish between the genuine professional and the free-loader. This can best be established by peer-assessment - long a successful operating principle of the Australia Council. This would just be an extension of the government's use of expert advice in many situations.
And there should be a quid pro quo. Artists receiving the dole would be required to exhibit regularly and to allow Artbank - the largely self-funded organisation which has for many years collected Australian works of art for the decoration of government facilities and for commercial lease - to select one work per year for inclusion in its collection. This choice could either be gratis or by purchase under strictly regulated conditions. If the latter, to guard against prices being artificially inflated by commercial galleries or dealers, the prices could be negotiated at between 50% and 75% of the gallery price. Artbank's selection should be done by a peer-group consisting of one permanent Artbank officer and two local peers, the latter each retiring after three years to minimise personal or stylistic bias.
This would require a permanent Artbank office in each state and territory capital but, except in New South Wales and Victoria (and, possibly, Queensland) this work could be done by one permanent officer assisted by volunteers or appropriately qualified officers seconded part-time from the state's arts secretariat. In total, it would entail appointing only half a dozen additional staff to Artbank, and Artbank's local office accommodation could by supplied by the state organisations.
In addition, Artbank should establish a gallery in each state capital in which the acquired works would be shown and offered for sale at gallery prices. This would cover some of Artbank's expenses and also give valuable publicity to artists.
The cost of implementing such a scheme would not be as high as for some schemes the government already supports. Apparently, primary producers, who receive many thousands of dollars in drought relief and other loans - amounting to $200,000,000 in 2002 - hardly ever pay the money back! And The Australian reported on 30 April, 2003, that the government has paid the textile industry the equivalent of $13,000 for each of its workers.
Taxation is another area in which artists are disadvantaged by the current 'industrial' system. Whereas it is, of course, equitable for artists to pay income-tax, the Goods and Services Tax is both an abomination to art and actually counter-productive for the government (although no one seems to realise this). Firstly, it places an inequitable burden on the art market because commission on sales is usually only 33 1/3% or, at the most, 50%, whereas generally retail mark-up is 100%. In turn, it is also unfair to artists who are not really in control of the prices for their works and cannot raise them to cover the GST.
But, further, artists who are registered as businesses and for the GST, and who operate their finances diligently, operate at a loss for many months on end and - because they are able to claim refunds of GST paid on materials they use, studio rental etc - are usually in a credit relationship with the ATO. So, the government gains nothing from artists, and artists have the burden of keeping account of the small items of material they purchase. This is a stupid and unfair situation and should be discontinued.
This article attempts to raise significant issues relating to the 'realpolitik' of producing art in our market economy. It is to be hoped that whose who have the power to make it more equitable in the national interest will take note.