Moneypulations
Heie Treier (3-4/2010)
Heie Treier speaks of the umbilical cord between finance and the art world
In view of the global economic crisis that began on 15th September 2008 with the collapse of a major US bank, Lehman Brothers – an event as surreal as planes crashing into the Twin Towers of the World Trade Center in New York on 11th September 2001, we now have reason to take greater interest in monetary systems and the inner logic of their functioning. In his macroeconomic analysis, Karl Marx regarded economy as foundational, meaning that it is something of essential importance, whereas culture (including art) is part of a superstructure. This implies that art and culture rest on economic foundations and are therefore less important than the economy. It may also explain why Marx was not concerned with conceptual analysis of art and culture. If Marx was right about this, then artists and art historians should try to learn more about the economic foundations.
Recently, I have attempted to understand different macroeconomic analyses and their relationship to the current global financial situation, and I have reached a surprising conclusion concerning art processes at the macro level: if we imagine Western society during the 20th century in terms of two parallel axes – an art or broadly cultural axis and a financial axis – we see that after extreme events in the financial world, similar events tend to follow in the world of art and culture. Therefore seems that while events in the financial world may be among the dominant factors in our era, they may also offer a potential key to understanding debates and conflicts between modernists and postmodernists during the second half of the 20th century – issues that have gained wide currency in philosophy, art and culture.
The dollar and gold
The Bretton Woods Agreement of 1944 tied the US dollar to the gold standard and, in turn, tied other currencies to the US dollar. Price of gold was fixed at $35 per ounce. Due to difficulties in foreign policy, in 1971 US President Nixon decided to untie the dollar from gold. The US Government was given a free hand to print an unlimited number of new banknotes and the dollar began to drop in value as a world currency. This initiated a situation that continues to this day:[1] a so-called ‘post-modern’ monetary model that has been largely responsible for stock market bubbles (especially during the 1980s), real estate bubbles (at the turn of the 21th century), and the bursting of those bubbles (Black Monday on 18th October 1987 and the bankruptcy of Lehman Brothers respectively). At times, it has seemed that the laws of nature and economy have ceased to exist. Analyst Alar Tamming has described the situation: “looking at world history, we can see that, without a single exception, all monetary systems that didn’t have a real backing [in gold] have not lasted, and paper money has always come down to its real value, which is the value of paper itself. There have been no exceptions.”[2]
The Soviet Union was the last major obstacle to globalisation. After it collapsed in 1991 the globalisation and expansive development of capitalism resumed, leading from one fragile bubble to another, and not only in the United States (the 1997 financial crisis in Asia, the Estonian stock market bubble, and the Estonian real estate bubble that inflated rapidly from the beginning of this century and peaked in 2007). During the 1980s, the virtual economy was boosted by the adoption of credit cards in the USA and the creation of electronic money, which entailed a life of debt both for individuals and for whole states. Today, money circulates as computer data and there is hardly any need to print new banknotes; a simple keystroke is all it takes to increase the amount of money in circulation.[3] Of course, all of this causes tensions that spill over into other spheres, including politics. Alar Tamming: “compare here the 19th century (when global economy was in bloom, more than 60 countries had joined the gold standard and no great wars were occurring) with the early 20th century, when the gold standard failed and the world was dragged into two World Wars. The current system can only function as long as more money is added to the system, and it will inevitably end up in a crisis or hyperinflation.”[4]
Art and the dollar
Comparing the art axis with the financial axis, we see that a significant part of the Western art world, especially that of the US, has resonated with events in the financial world. The 1970s witnessed the emergence of postmodern architecture with its unexpectedly whimsical formal language that created controversy among specialist circles. The inner logic of the postmodern cultural model, which drove Jürgen Habermas to philosophical desperation during the 1970s and forced Jean Baudrillard to write agonizing analyses during the 1980s, relies on the inner logic of postmodern economy whereby money has no security in gold and where a virtual environment makes everything possible. During the 1980s, the short-lived East Village artists’ colony was intensively active in New York.[5] However, when the stock market bubble burst in 1987, it ceased to exist. In the US as with many other places, the interest of the art world in other parts of the geographical world depends on the financial market’s interest in the stocks of that area. Thus, after the 1997 financial crisis in Asia the rating of contemporary Asian art decreased along with other stocks. The 1980s saw the establishment in several countries of conceptual artist groups modelled to mirror commercial enterprises, such as Technotest SRL, Banca di Oklahoma (Italy), Philippe Cazal (France), Int. Fi$h-handel Servaas & Zn (Holland), Ingold Airlines (Germany), Bonk Business (Finland) and Kostabi World (USA). These groups were not concerned with engaging in Marxist critique of capitalism as previous generations had done (for example, Hans Haake, whose idealism began in the 1960s). Instead, the 1980s generation of young artists derived their activities from the new realities. This attitude has been passed on to subsequent generations and with increasing cynicism.
At this point, it would be helpful to describe a few examples. During the 1990s, Danish company Superflex produced design that sought to ‘save the world’. At the 4th Manifesta Biennial in 2002, held in Frankfurt am Main (the financial centre of Europe), financial manipulations were analysed using artistic means. This inspired the young Dutch artist Marc Bijl to call the event ‘Moneyfesta’. Swiss artist Christoph Büchel sold his participation rights in Manifesta by internet auction: he exchanged his artist’s reputation for money, perhaps intending to discover the financial value of participation. The auction took place on eBay from 25th May to 24th August 2002, and the US artist Sal Randolph purchased the participation rights for 15 099 dollars. Randolph, in turn, invited artists who wished to exhibit their work to participate for free in a gift economy or Free Manifesta.[6] An extended discussion of the various artistic strategies in relation to business and money appeared in a special supplement of kunst.ee (1/2003) called Firms and Fictions.[7] In Estonia, Marko Raat and Anders Maimik have drawn closest to suggesting this kind of cynical manipulation in their film Agent Wild Duck (2002), which considers the possibility of making money by selling plain air.[8]
Perhaps the most extensive ‘money-pulations’ in the Baltic States occurred in Lithuania in 2007, when the purchase of the Fluxus archive for Vilnius resulted in a political scandal.[9] Is it appropriate to spend five million dollars of tax payers’ money on purchasing 2600 objects, the bulk of which are cheap paper, collage and conceptualist objects carelessly compiled from low-quality materials?
The kroon and the euro
Recently, the most pressing issue presented on local Estonian news media has been the adoption of the euro as local currency (starting 1st January 2011). At the moment we can only speculate as to how it may affect economic security and how it might affect art. Alar Tamming again: “At the beginning, when Estonia took a course towards joining the euro, I welcomed the idea, naively expecting that, with so many wise decision-makers from different countries involved, the collective IQ of the planners would be enormous and they would naturally also consult 2000-year-old folk wisdom. This has not been the case. The proposed budget deficit is constantly increasing, there are huge state debts and, what is worse, the euro is not secured on anything. Everyone is content with huge inflation figures, but no-one talks about the real reason behind it – the printing of unsecured money, or rather the generation of billions in bank accounts by the simple click of a button. Unfortunately, this is a global process affecting virtually every country in the world. Criticism of the current system has become a taboo, just as it was a taboo to criticise socialism in the Soviet Union.”[10]
Is it all a question of the sustainability of money? Comparing the charts of gold prices with the rates of EUR-XAU-USD, we see that, against the backdrop of the devaluation of the dollar during the past ten yeas, the world has been gripped by gold fever; and the situation may yet become much worse. This raises the question: What might serve as a stable ‘gold standard’ for contemporary art? The gold standard appears to have been given up in favour of an uncertain world order in which a fortunate few can access enormous profits while everyone else is busy repaying bank loans. But what about the value of contemporary art? Each of us – artists, critics, spectators, etc. – can easily present our own preferred sets of values, but they do not automatically apply. How can we talk to one another and discuss matters when we share no common denominators whatsoever?
Heie Treier is an assistant professor of art history in Tallinn University and the member of the editorial board of kunst.ee magazine.
This article is based on an extended version of a speech given at the seminar on art and money, held in Tallinn Art Hall on 3.09.2010. The author would like to thank Thomas McEvilley for collegial discussions, and The Kostabi Show: (http://thekostabishow.com/http://thekostabishow.com/http://thekostabishow.com/ ) for inspiration.
[1] Risto Sverdlik, Dollari tõus ja langus reservvaluutana. – LHV financial portal, 20.07.2010 (http://lhv.e24.ee/?id=289873http://lhv.e24.ee/?id=289873http://lhv.e24.ee/?id=289873 ).
[2] Alar Tamming, Miks euro ei aita Eestit ja mis siis üldse majanduses ja maailmas toimub? – http://alartamming.blogspot.com/2010/07/miks-euro-ei-aita-eestit-ja-mis-siis.htmlhttp://alartamming.blogspot.com/2010/07/miks-euro-ei-aita-eestit-ja-mis-siis.htmlhttp://alartamming.blogspot.com/2010/07/miks-euro-ei-aita-eestit-ja-mis-siis.html . (Alar Tamming is primarily known as the owner of Tavid currency exchange offices. and hereafter I am referring to the posts in his personal web log titled Economy, Locally and Globally(Majandus meil ja maailmas).
[3] See, for example: Erik Rand, Ameeriklaste raha juurde trükkimine teeb Hiina ja Saksamaa murelikuks. – Eesti Päevaleht Online 5.11.2010 (http://www.epl.ee/artikkel/586734http://www.epl.ee/artikkel/586734http://www.epl.ee/artikkel/586734 ).
[5] See: Baird Jones, Mark Kostabi ja East Village’i kunstielu 1983–1987. Tallinn: and kunst.ee, 2006.
[6] Katja Blomberg, Rights to participation in exhibition flogged off. – http://www.manifesta.org/manifesta4/en/press/pressm17.htmlhttp://www.manifesta.org/manifesta4/en/press/pressm17.htmlhttp://www.manifesta.org/manifesta4/en/press/pressm17.html .
[7] See: Firmad ja fiktsioonid (Firms and Fictions). Special supplement of kunst.ee. Edited by Eve Kiiler. – kunst.ee 2003, No. 1, pp. 35–62.
[8] Mari Laanemets, Rites for Businesses in Crises. with Florian Feigl. – kunst.ee 2002, No. 3: special. by Anders Härm, Hanno Soans, Kiwa [pages unnumbered].
[9] Skaidra Trilupaityte, Fluxuse “tagasitulek” Leetu. Petra Stegmanniga. – kunst.ee 2008, No. 3, pp. 28–37.
[10] Alar Tamming, Rahast, eurost ja kroonist.
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