It’s not the global economy, stupid

Analytical fashions come and go, but the postmodern concept of hyper-reality, the state in which distinguishing between reality and its simulation becomes impossible refuses to fade into irrelevance. In January, the political historian Anton Jäger suggested that we have finally entered the era of hyper-politics: the phase in the evolution of democratic societies when anything and everything becomes a matter of politics.[1]Anton Jäger, ‘How the World Went from Post-Politics to Hyper-Politics’, 3 January 2022, https://tribunemag.co.uk/2022/01/from-post-politics-to-hyper-politics. This hyper-politics is not the politics of the union movement or partisan electoral gestures. Hyper-politics, instead, is the ideological scrutiny of every event that saturates all spheres of life and from which there is no opting out. In the age of hyper-politics, your aunt has loudly articulated opinions on lockdowns, statues, free speech, and trans rights. And boy, are they political.

If hyper-politics is a malaise that breaks all the promises of political participation by distracting us from the substance of political realities, an age of hyper-economics follows closely on its coattails. Like hyper-politics, hyper-economics has little to do with the here-and-now economics of jobs, taxes, or business grants. Instead, it’s an economics of the global stage, of OECD, WTO, and other acronymised ideas. Like hyper-politics, this global hyper-economics is so seductive that it draws us to participate in world-shaping debates which would have been the preserve of government experts and trade emissaries until not long ago. And just like that of hyper-politics, hyper-economics’ role is to loosen our grip on the reality of power by creating the illusion that the discourse we are participating in is the reality.

Hyper-economics’ favourite issue is anti-globalization. After a brief respite from MAGA politics, Russia’s invasion of Ukraine has brought the Manichean morality of global flows of goods back into everyday focus. Isn’t it good of Apple Pay to boycott the Moscow metro? Have our elected representatives moved quickly enough to sanction Russian aluminium? These are valid concerns and we cannot blame economic pundits for speculating on the future shape of the economic system that has supplied our food and fuel for decades. But the critiques of the economic impasse are indicative of a dearth of new ideas. Certainly, globalization “has run its sorry course”[2]Nick Timothy, ‘Globalisation Has Run Its Sorry Course. We Must Find a New Model’, The Telegraph, 27 March 2022, https://www.telegraph.co.uk/news/2022/03/27/globalisation-has-run-sorry-course-must-find-new-model/. and has shown itself to be incompatible with freedom.[3]‘Confronting Russia Shows the Tension between Free Trade and Freedom’, The Economist, 19 March 2022, https://www.economist.com/leaders/2022/03/19/confronting-russia-shows-the-tension-between-free-trade-and-freedom. But to conclude that ‘something has to give’ because we no longer like the smell of Russian gas is to ignore that the internal contradictions of global flows of capital have been obvious for decades.

The nature of the proposed successors to the globalist order remains nebulous. The global economic order’s proposed successors include versions of radical independence, strategic diversity, brute-force free trade, multilateral protectionism, and even dreams of a global plan economy. Some of these propositions have the ring of Trump’s ‘America First’ or Brexit’s ‘Take Back Control’, in tone if not intent. After ‘Chaina’ and ‘Brussels’, Russia makes for the perfectly immoral economic bogeyman.

It remains unclear who would lead a sweeping overhaul of the world’s economic order: the great man of history theory lacks a Reagan or a Thatcher for 2022. Pretenders are plentiful but even Trump’s assault on international trade run out of steam even before the pandemic hit. But the lack of a daring global economic vision amongst G7 leaders should not distract us from the fact that those ‘great men’ are still around and that they have been practising the hard economics of dollars and renminbi while we have been distracted by the ideological debates of hyper-economics. 

Davos, Switzerland. Photo: World Economic Forum/Andy Mettler/flickr.

Today’s greats are the men of Davos, the oligarchs of Russia, China, or the US. Here, that ‘hyper’ prefix which indicates an untrue reality comes in handy again: ‘great men’ don’t need greatness. Granted, some harbour ambitions of colonizing Mars, but the majority wouldn’t even make the news if they became the subject of economic sanctions. They are immune to scrutiny because they have made Faustian pacts with hyper-economics’ spiritual leaders: Klaus Schwab, Vladimir Putin, and Xi Jinping. Of course, these great men are not following some conspiratorial plot devised to return the world’s global order to some status quo ante and who has the upper hand changes periodically. This hardly matters because the object of the game is to harness the flows of capital and war, in the long run, is good for business. The sublime magic of hyper-economics is that it no longer relies on the international rules-based order. Just like democracy is no longer a prerequisite of capitalism, neither is a global consensus essential to globalization. 

The superbly obfuscating power of hyper-economics at times of conflict is that it steals the moral valour of international diplomacy ostensibly rooted in political deliberation. How effective are governments and multilateral organizations in shaping a global future when their promise of war-ending sanctions and fracking proves to be no match for war itself? Is it not the case that for all the political contingency of the global commodity trade, the power of NATO allies over Russia’s economy has remained merely symbolic? 

It turns out that stopping Nord Stream 2 does surprisingly little to arrest the undercurrent of capital circulation that keeps the disciples of Schwab and Putin in power. This is, of course, an inevitable effect of deregulating and privatizing our economies completed with China’s full embrace of ‘state capitalism’.[4]Karl Gerth, Unending Capitalism: How Consumerism Negated China’s Communist Revolution (Cambridge, United Kingdom New York Port Melbourne New Delhi: Cambridge University Press, 2020), https://doi.org/10.1017/9781139025225. We have become so economically libertarian that it is now too late to pull the moral handbrake. Between the flows of Taiwanese semiconductors and Ukrainian grain, we are now one shortage of agricultural fertilizer away from joining the UK secretary of state Liz Truss in nostalgically waxing about the country’s international cheese trade balance.[5]Conservative Party Conference Speech, 2014, https://www.youtube.com/watch?v=y2V3PrfN98U.

This mismatch of morality and scale is also the missed potential of protectionist populisms or the fantasies of economic green transition that in hyper-economic terms rely on simplistic, singular interventions in the exchange of commodities. It is unsettling to think that Steve Bannon’s Movement and the Paris Accord could fulfil their goals through similar means, but even more so to understand that both at the core rely on relegating political agency to the men behind Davos, the Kremlin, or Beijing.


Main image: Jim Black/Pixabay

Notes[+]

Value in Numbers

Post-truth narratives and the symbolic order of the value of art in crisis.

Few questions have received as much attention from art practitioners and critics as that of the value of art and culture to society. Philosophers since Plato have speculated that art is inseparable from human existence as key to emotional, educational, and societal wellbeing.[1]Eleonora Belfiore and Oliver Bennett, The Social Impact of the Arts: An Intellectual History, 2008 <https://doi.org/10.1057/9780230227774>. But how should we account for these functions? How should we measure their worth against other social phenomena and in relationship to the state as the medium of exchange of value? Despite thousands of years of debate and the existence of a whole academic discipline that supports it,[2]See, for example, ‘Centre for Cultural Value’ <https://www.culturalvalue.org.uk/> [accessed 23 September 2021]. there are few straightforward answers. 

In the past year, the arts have had to argue for their worth in competition with other industries while cut off from their usual platforms that made previous manifestations of cultural value potent: gallery shows and dance performances on Zoom didn’t carry their usual weight. Even so, what the arts have over many other imperilled industries is their monopoly on boundless creativity. Given the current urgent need to rebuild social bonds and repair fractured cultural values, and the earlier chance for the arts to rehearse similar messages in the post-2008 austerity regimes, we could have expected a campaign that once and for all proved that ‘only art can save us’. We could have expected a campaign that brought inspiration and reflection that the arts have delivered for thousands of years. We could have expected a cheesy, morale-boosting message. Or maybe even a concerted effort to reassert values such as unity or community pride. Any of these would have done. Instead, a series of arts campaigns in the UK obsessed with the economic and statistical value of culture, in an argument that inspired few and convinced fewer still. Given that British cultural policy has long been the trend-setter for many other European arts economies, this moment warrants some critical reflection.  

The end of civilisation as we know it

To understand the narratives which took centre ground in the current crisis, it is worth tracing the recent history of art’s relationship with the state. As recently as in the 1980s in the UK, the keyword was ‘subsidy’ and the value of ‘high’ culture went unquestioned. In an episode of the iconic BBC comedy Yes, Minister[3]Peter Whitmore, Antony Jay, and Jonathan Lynn, ‘The Middle-Class Rip-Off’, Yes, Minister (BBC, 1982). <https://www.youtube.com/watch?v=Zl0aEz34A4o> the hapless secretary of state Jim Hacker had to decide between saving an art gallery and saving a football club in times of adversity. For the civil servant Sir Humphrey Appleby, the very notion of comparing the two was sacrilege and could only lead to the end of civilisation. Opera is culture. Sports, irrelevant mercantilism.

Peter Whitmore, director, ‘The Middle-Class Rip-Off’, written by Antony Jay and Jonathan Lynn, Yes, Minister (BBC, 1982)

Since this sketch was written, the language of public support has changed dramatically. Deregulated free-market capitalism heralded a language of conscious exploitation of the power of the arts to achieve instrumental social outcomes. Ideas of the transformative potential of the creative economy lurked in the background but no one was ready to call bluff on the tenuous links between the emergent social art practices of museums and galleries and the booming tech or video games industries. By the 2010s, the discourse moved further to ‘investment’ and Arts Council England proudly announced that ‘for every £1 that it invested in the arts, the private sector added a further £3.’

What artists thought of these frameworks seems to have depended on the amount of subsidy or investment. At the turn of the century, conditions were idyllic by today’s standards: the more use for art the state had, the more art workers the state would support. In the confused policy language and the lack of leadership from institutions, perhaps it wasn’t always clear that the subsidy and investment would eventually require a return and that when they did, such returns would likely have to come from excess labour. To confuse matters still, the art market epitomised by London’s Frieze art fair grew into its now nearly dominant strength, making it difficult for artists and their communities to understand how their creativity and labour translated into the logics of public and private markets. This situation is not without parallel in the knowledge-labour economies in which individuals are invited to ‘invest’ in their education or to form ‘partnerships’ with capital. Just like it’s almost impossible for an individual to understand the multiple meanings of value of their student loan, how can an artist navigate the multiple interests of the public £1 and the private £3 when neither reaches their pocket? 

Too big to fail

If the past twenty years were characterised by cultural institutions’ resistance to financialisation, art schools’ vocal denial of market logic, and artists’ qualified mistrust of the art market, the pandemic year revealed a curious narrative shift. Amid all the chaos and disaster of lockdown museum closures and furlough for the luckier art workers, a group of UK arts organisations and thousands of artists – perhaps dismayed by the relatively ungenerous level of Britain’s state support in comparison to that extended by France or Germany – came together to campaign for a public bailout and for a new round of public investments to support the industry’s recovery. Their message: #artisessential because “the arts and culture sector contributes £2.8 billion a year to the Treasury via taxation” and the “creative industries employs [sic] 2 million people.”[4]‘#ArtIsEssential’ (CVAN England, 2021) <https://www.artisessential.art> [accessed 1 June 2021]. Repeatedly, they reminded us that “the Creatives [sic] Industries contributed £116bn in GVA [gross value added] in 2019.”[5]‘Leading UK Contemporary Visual Arts Institutions and Art Schools Unite against Proposed Government Cuts to Arts Education’ (Contemporary Visual Arts Network, 2021).

‘#ArtIsEssential’ (CVAN England, 2021). artisessential.art

These numbers and livelihoods are far from trivial, but the messages themselves are riddled with errors, and not just in spelling. Where do the ‘arts’ end and the ‘creative industries’ begin? Most of the employment for which this campaign tried to take credit comes from the film, digital, and games industries, explicitly outside the purview of the campaign. The GVA figure repeated this confusion and according to Arts Council England’s already inflated data[6]Cebr, Contribution of the Arts and Culture Industry to the UK Economy: Report for Arts Council England (London, April 2019). overstated art’s economic contribution at least tenfold. Can we defend the value of museums and galleries by claiming credit for the economic worth of software programmers?

There are prosaic technical and statistical reasons for some of these errors,[7]Hasan Bakhshi, Measuring the Creative Economy: A Guide for Policymakers (Creative Industries Policy & Evidence Centre, 2020) <https://www.pec.ac.uk/discussion-papers/measuring-the-creative-economy-a-guide-for-policymakers> … see more but they hardly excuse the persistent and wilful misuse of ‘facts and figures’ by the arts industry. And the misuse is now a habit: a 2019 report for Arts Council England, for example, admitted to counting the value of culture in some bizarre ways, arriving at a headline figure of £22 billion GVA by counting not only the value of the culture produced and consumed plus the value of its supply chain but also the induced value that includes the rent and grocery bills paid by art workers. To an economist, such an estimate is nearly meaningless, suggesting that your local supermarket could equally include the Mamma Mia tickets bought by its employees in the tally of its economic worth and ask for public subsidy because vegetable retail supports cultural production. Accurate data isn’t impossible to obtain, either. By the time the debate on the value of arts and culture and their pandemic needs reached the UK Parliament,[8]John Woodhouse and Georgina Hutton, Covid-19 and the Arts and Culture Sectors, Briefing Paper (House of Commons Library, 25 February 2021).the numbers appeared more modest: arts and culture employ 226’000 people (not two million) and GVA stands at £10.6 billion, but this did not stand in the way of #artisessential lobbying Government with the £116 billion figure only weeks later.

Post-truth art

Who decided that this financial and statistical argument would serve the arts’ cause best? Do artists and arts organisations know that their numbers are incorrect? Do they understand what they’re talking about? How did they hope to convince bureaucrats of their case? Are they just comforted by the abstraction of impressive-sounding large numbers? And most damningly, why are they lying?

We have come to expect manipulation of statistics from politicians, exaggeration of budgets from bureaucrats, and empty promises of social value from corporations. Their counterfactual narration of reality may sit well in the shadow of Donald Trump and the low-gloss populism of global politics, but such post-truth demagoguery is demonstrably not the exclusive domain of the political right if the public art sector can repeat baseless claims without batting an eyelid. No, one in twenty UK adults isn’t an artist.[9]2 million employed in the creative industries out of the UK’s working age population of about 41 million. No, culture is not worth more economically than oil and gas combined.[10]A claim made by a theatre industry campaigner on Radio 4’s Today programme in September 2020. Don’t we have better arguments?

Cebr, Contribution of the Arts and Culture Industry to the UK Economy: Report for Arts Council England (London, April 2019).
Cebr, Contribution of the Arts and Culture Industry to the UK Economy: Report for Arts Council England (London, April 2019).
‘DCMS Sectors Economic Estimates 2018: GVA’ (Department for Digital, Culture, Media & Sport, 2020).

Perhaps these numbers are ‘just’ numbers and ‘deep down’ we know that they are fictions. But if we get the stats so wrong and still rely on them to perform our collective politics, what else are we getting wrong? In his attempt to construct a political theory of the post-truth, Ignas Kalpokas argues that there is nothing ‘post-’ in post-truth: today’s arts are following the footsteps of generations that tried (and failed) to free themselves from the reigns of capital-t Truths and capital-r Reason of the Enlightenment.[11]Ignas Kalpokas, A Political Theory of Post-Truth (New York, NY: Springer Berlin Heidelberg, 2018). The unfortunate side-effect may be that in thinking about the present condition as exceptional and beyond the reach of reason, we have lost the ability to deploy reason itself when we need it.

The proof for Kalpokas’ characterisation is that none of the floors in the argument mattered because the UK cultural sector secured an unprecedented bailout of £1.56 billion last year under the government’s Culture Recovery Fund. Even this has had its critics but the numbers proved themselves to be efficient storytellers, their sums large, the economic story compelling. The arts may think that they won this argument, more or less. It may be natural to try and forget all this and breathe a sigh of relief rather than quibble over who was right and who was wrong, let alone hurl accusations of hypocrisy at one’s own team.

Art simulating itself

Even if on this occasion the denial of fact displays the hallmarks of an effective tactic, leaving it unquestioned may have significant consequences. Never mind the hollow and unsustainable sense of security the industry leaders may have felt in their negotiations with politicians on this occasion, the outsourcing of the post-truth problem to the realm of the political right makes it all too easy to overlook the profound challenge in the way that artists and their organisations understand their value in society. How value is expressed has puzzled theorists since before Adam Smith. In as much as the arts can be read as market goods – Sir Humphrey Appleby’s take that they should be a purely public affair has little hold in 2021 – Marx’s notions of use-value and exchange-value have been sufficient in reflecting the utility that audiences derive from attending theatre performances, art markets prices fuelled by fabricated scarcity, and even the language of public ‘investment’. 

But what use is Marx when the aesthetic, ethical, epistemic, or instrumental arguments for the value of the arts have so effortlessly rolled into financial matrices, abandoning their earlier complex frameworks? The professional pessimist Jean Baudrillard observed that such a state emerges when society is organised around simulation rather than consumption.[12]Douglas Kellner, ‘Jean Baudrillard’, ed. by Edward N. Zalta, The Stanford Encyclopedia of Philosophy (Metaphysics Research Lab, Stanford University, 2020) <https://plato.stanford.edu/archives/win2020/entries/baudrillard/> … see more Aesthetics can become a subject of commodity consumption, but this is less straightforward in the case of art’s ethical or epistemic features. What if the knowledge economy of the arts does not resonate in the ideas of commodity production? And what if the instrumental value of the arts becomes a matter of discourse, rather than of service-level agreements? When we have so deeply mixed in those dematerialised values of art practice that have little to do with price or utility into the financial tally, Marxian ideas of value collapse.

Baudrillard’s simulacra uncannily encompass the shift in the pandemic value narrative. Where once we had art, we now have an art producing machine. The value, or values, of the art that this machine produces are not related to their Marxian values. If the art machine says that it produces £116 billion in GVA, then it almost doesn’t matter whether it also produces any ethical or epistemic qualities. Eventually, the art machine no longer needs the languages used to describe values other than those easily digestible rubrics of pounds and pence. 

Other, less exalted commodities are subject to similar evolutions. A quantity of grain has an exchange value (its price) and a use-value (the value it has when turned into a food). But while grain is traded on in international markets, so is the simulation of grain. Financial derivatives such as grain futures are traded in the stock markets in a volume that far exceeds the volume of grain actually produced, exchanged, and consumed. Trading grain futures is based on symbolic value, not use value; grain futures are a simulation of grain. The same may be happening in art now. Neither the £116 nor the £10.6 billion that narrates art and artists has anything to do with the art produced or consumed: it is merely a financial instrument that simulates a real commodity trade (the opera tickets, artist fees, auction sales) that need never take place. 

This is a serious indictment and, in Baudrillard’s terms, a dead-end for art. We cannot merely blame the art market for this narrative failure, either. Contrary to our instinctive understanding of neoliberal capitalism, the simulation does not come about because art and culture have become completely commodified by the market logic that replaced state support. Certainly, plenty of art objects from Monet to KAWS hold their comfortable status as premium commodities traded in auction houses and stored in freeports; for them, Marx’s notions of exchange and value hold – they are free from the lure of simulation. But paradoxically, as most artists and their institutions have resisted thinking about their participatory art projects, non-profit galleries, or experimental installations in those same commercial ways, they have inadvertently given up their claim to the utility or exchangeability of their work. When in addition other notions of value collapse, as they did during the pandemic, post-truth manipulation may seem like the best of options.

For Baudrillard, the dichotomy between the luxury art object and the non-economic art practice would be evidence for his thesis: if the art industry resists commodification, it is because it has lost its connection to the very commodity that it represents. This matters because anything that we consume is a commodity and art does itself a disservice by denying this classification. If the arts have resisted thinking about the public value of their work in market terms, all they are left with is a false narrative of overabundance and symbolic value as a simulation.

Token aesthetics

In his writing on art, Baudrillard extended this scepticism to the aesthetic and pronounced the end of art as an inevitable consequence of the endless proliferation of artistic practices.  The recent rise of NFTs is a further indictment of art’s loss of confidence in its value and the explosion of this market during the pandemic when physical art lost access to exchange and utility is no coincidence. NFTs are the perfect containers of symbolic value: they present themselves to be free of utility, ethical, or epistemic claims and they bypass even the fundamental question of whether they are art or not by espousing an aesthetic that inspires little discourse. Even if NFT sales correspond to individual artworks, these works resist becoming commodities in the traditional sense by manufacturing scarcity just like the contemporary art before them did. Only they do so more efficiently: where speculation in the future value of physical art objects was subject to the obscuring behaviours of the traditional art market. NFTs are perfectly designed to become the basis of financial speculation as they are ready-made financial instruments, index funds designed to breed further simulated derivatives. When Christie’s staged the record-breaking sale of Beeple’s $69 million masterpiece, the lack of attention to any discernible qualities of the work was deafening because NFTs don’t even have the pretence of a cumbersome physical commodity behind them and therefore they need not be governed by the exchange value narratives of the traditional art market. 

EVERYDAYS: THE FIRST 5000 DAYS (Beeple, 2021)

While the arts industry remains broadly sceptical of animated GIFs, the one aspect of the NFT simulation that the mainstream cultural narrative has embodied unquestioningly is the unthinking optimism and hype of the crypto asset trade. As the value of Bitcoin relies in no small measure on millions of speculators blindly believing in it, so does the value of the art industry. In a world of simulation, isn’t it imperative to maintain that art and culture generate £116 billion in GVA? Is this our future worth?

Although Baudrillard’s vision of the role of art in the simulation is bleak, it reveals an opportunity for art and artist to break out of the simulacrum. Baudrillard jested that the contemporary world’s greatest achievement was not the commercialisation of anything and everything, but instead, it was the aestheticization of the whole world, that is turning it into images and symbols that become simulations of the formerly real thing.[13]Jean Baudrillard, The Transparency of Evil: Essays on Extreme Phenomena, trans. by J Benedict (Verso, 1993). This meant that there was no role left for art because it could no longer subvert the simulation and because art relies on participating in the simulation for its existence.[14]Douglas Kellner, ‘Jean Baudrillard and Art’.

But have we indeed reached a point of aesthetic oversaturation in which the Instagram feed has taken over all attempts to mediate meaning? The experience of the past months suggests that art does not take its aesthetics nearly as seriously as it could. The same #artisessential campaign that made claims of the industry’s financial prowess chose to outsource the question of aesthetics to artists and the results were underwhelming, to say the least. Are frowning selfies and handmade banners all that we can do? Why haven’t we thrown ourselves into the making of inspiring images, gaze-arresting displays of aesthetic, social, or intellectual value? 

As long as some of these avenues remain underexplored, there may be a way to escape the still-incomplete simulation, and it lies in the renewal of aesthetic practices. Such evolution is always already taking place in the ever-changing landscape of art production but we must consider once more the balance of aesthetic, social, and market interests that fuel our work because straying too far into Baudrillardian territory could mean that we are left with nothing but hollow hashtag or GVA stories. If we succeed, it will be as artists, not as social workers or commodity traders. In the neon words of Stefan Brüggemann: to be political, it has to look nice. 

Another option whose radical potential is also poorly served by the post-truth turn to economic value accounts could be to invest in developing a broader value literacy in the art industry so that it can build new, convincing narratives. It may even be that when the narratives are brought back in line with their underlying realities, they can no longer reinforce the simulacra: a self-induced collapse predicted by the more benevolent strands of accelerationism. Until we take active control of our own ‘progress narrative’, help could perversely come from the politician or the bureaucrat who simply dismiss the arts’ economic arguments and forces our attention back on those values that we can maintain as a matter of our own realities.


This text first appeared in Arts of the Working Class in October 2021

Notes[+]

Pyramid scheme meets bubble

NFTs are the least of art’s problems, but the crisis of value has no end in sight

If you are bored with lockdown and you happen to own an iPhone, chances are that you spent a few minutes on Clubhouse. And if you did, you heard at least one endorsement of NFTs delivered with the zeal of a televangelist on a fundraising drive. NFTs will change art, the gospel goes. Or they will at least change the market for digital art. And even if they won’t, you should be buying, or selling, right now.

Let’s gloss over the technical descriptions: NFTs are both staggeringly complex and stupidly simple. In essence, an NFT is no different from a certificate of authenticity traditionally issued by an art gallery as part of a sale. This certificate named the author of the artwork, confirmed that it was unique and that the certificate was the agreed means of verifying those assertions. NFTs do bring some new features to this already perfectly-functioning system: they can be verified publicly, guaranteed to be unique, and they can contain additional contractual conditions. They are also algorithmically attached to the digital artworks they describe. An NFT, in short, is a fancy, forgery-proof certificate of authenticity embedded in a piece of digital art, which makes it a perfect companion to items that may have previously been uncertifiable, like GIFs, videos, or Tweets, whether these art or not.

If that is all, why has the art world gone NFT-crazy? With even Christie’s in on the game, there must be something to it. Well, perhaps. The rise of NFTs may do something to establish internet memes as a commodifiable art form. It may move significant amounts of money between a certain type of collector and a certain type of artist. It may even start a new trend that will keep multiplying like Yayoi Kusama’s dots. But contrary to all the hype, NFTs are not a new paradigm that will make art better, more democratic, or fairer for artists. They won’t do that because the fundamental idea behind them brings together the worst aspects of the art world with the parts of the financial markets: a pyramid scheme and a speculative bubble. In fact, the art market – if not art itself – has long displayed those tendencies and the arrival of NFTs simply brings them into sharper focus. The centrality of speculation and the mirage of the asset stability is so ingrained in art’s practices that these terms make little sense to anyone not involved in the blue-chip end of the market. 

Not the best foundation to grow an economy from. Photo: joiseyshowaa/flickr

The Dutch tulip bulb craze was the original asset bubble and deserves space on the art school syllabus. In 17thcentury Amsterdam, it was the consensus that some tulips were vastly more desirable than others. The supply of bulbs was limited by unspoken agreement, but the bulbs themselves had negligible use value. How, then, could the bulb trade get so out of hand that it made and destroyed fortunes? The trick was, in fact, incredibly simple and relied on only a few small manipulations. Some market participants were able to influence the discourses on quality far more than others. Bulbs could appear scarce if a market participant hoarded a collection, or used their influence to discredit the value of other bulbs. And when a few speculators paid over the odds, they seeded a trend that increased bulb prices for everyone, turning future traders into de-facto speculators.

How much does the art market resemble the tulip bulb trade? Certainly, art markets have displayed bubble behaviours in the past, a habit that becomes apparent whenever demand dries up, as it did after the 2008 financial crisis, for example. Left to its own devices, art constantly pushes at the bubble wall: what is and what isn’t good art is subject of debate in which power and money play no small role, art isn’t scarce, but good art is scarce by definition, and the carefully manufactured confusion between use value, exchange value and price turns even the most amateur collector into a speculator.

The cardinal difference between a tulip bulb and an artwork is that while most tulip bulbs are more-or-less the same, art can take many forms. If the art bubble does something that that Dutch horticulturalists didn’t, it is that in art production, all artworks can appear to be commodities, even if most are not. Every artist, whether they paint or produce community events, does so in a system that suggests that demands that their art has a symbolic exchange value that is distinct from its price.

How the symbolic value relates to the economic value or to the cost of labour required to produce the work is the market’s will. Jeff Koons’ balloon dogs are higher in economic value than in any symbolic aesthetic attributes – and it is the existence of a buoyant market for them that in turn imbues them with cultural value. By contrast, the prices paid for most video art, social practice, or art activism are far lower than the symbolic value that is vested in them by artists, curators, museums, and critics. To date, the intellectual and critical efforts behind the intangible art market orphans, have done little to boost the economic value of those practices to a level that would facilitate a true market.

All the same, it would be naïve to assume that this symbolic value of non-market art is not subject to the same inflationary bubble mechanisms that the exchange value of traditionally traded art forms experience. It is precisely because symbolic values are hardly ever exchanged for cash that this mechanism plays itself out: any artwork can claim ever greater intellectual value than the last. This is why art can claim to be essential, world-changing, or life-saving and imply that these attributes should translate into hard currency, even if they never have. Arguably then, it is artists that are the greatest speculators, each art school graduate hoping that either the monetary or the symbolic value of their work will pay off their investment. 

bitcoin
Image: Jernej Furman/flickr

If the symbolic value of non-tangible art seems abstract, it is the cryptocurrency world that elucidates it. Mainstream blockchain innovations such as Bitcoin share much with art practices: both have values that relate to the cost of their production (in the case of cryptocurrencies, that is the energy cost of performing algorithmic transactions), and both are exchanged at a very different value in the open markets. The value of Bitcoin, like with the tulips, rises because more people are willing to buy it than to create and sell it. This happens to be the case with most goods and their prices, except that with Bitcoin, £38900 turns into no physical asset and no contractual promise of value. In the eyes of many, this makes cryptocurrencies a classic pyramid scheme: only those investors who got in at the beginning gain, and only so if latecomers also lose. Back in the art market, to pick just one example, the endless parade of Damien Hirst’s spot paintings would have rendered them worthless by the fiftieth version if not sooner. But however many spots Hirst made, it remained in the early collectors’ interests to coerce others to join the investment bubble. Judging when to sell and how quietly is the pyramid builder’s art.

For now, there’s no shortage of believers, but the chorus of “this time it’s different” that usually accompanies a bubble is part of all cryptocurrencies’ marketing strategies. Some aspects are indeed different: crypto coins are genuinely scarce and the consensus is algorithmic, not speculative. The lack of a stable guarantee, however, is just as obvious as in tulip garden: a Bitcoin represents nothing other than itself, its value is not fixed to any other commodity, nor is it backed by a state bank that can overcome those problems by fiat.

But what if cryptocurrency did represent something, preferably something exciting and confusing whose value is difficult to ascertain? Here comes art! If NFTs render crypto dealing more palatable by attaching an ‘asset’ to the coins, art, or whatever the Bitcoin community could get their hands on easily, is the asset of choice. The deceptive magic of NFTs is that the items they represent – memes, animations, screenshots – can be claimed to be collectable and therefore valuable.

Nyan Cat, a record-breaking NFT feline.

In truth, even if there is some aesthetic or symbolic value in a Nyan Cat screen grab, it has no characteristics of an asset unless an ecosystem that supports the exchange and exploitation of the item is in place. Most NFTs, therefore, are about as collectable as those porcelain figurines found advertised in weekend newspaper supplements. And even then, it is hard to discern whether it is the artwork or the marketing jargon of the blockchain that is of any use. Certainly, NFTs can guarantee scarcity, but when they do that in a pool of ‘assets’ that is limitless in supply, this only morphs a sphere into a pyramid.

But the issue is not just the subjectively limited quality of NFT art. Rather, it is that art can claim to create value from nothing and never be called to show its hand. On the blockchain, art is willingly being used to con market participants by underwriting financial investments with an asset value to which art has no access. In a sense, all of the art market is based on this deception: for some artworks to act as commodities at the auction house, many other works have to trade their symbolic value on even more opaque markets. Maybe none of this matters: gullible investors in NFTs will either love their meme art or be disappointed when their bargain collections fail to appreciate. Some artists may burn their fingers, but no more than they already do in trying to enter the mainstream art market. 

Art’s tendency to trade claims of value outside of its own field without check is, however, profoundly worrying, and it has caused material damage already. In the past three decades, for example, certain socially-engaged art practices undertook to replace aspects of the welfare state, offering symbolic value in place of previously available economic value. In the UK, as a tiny proportion of the diminishing state funding for social work was diverted into community art commissioning, art has continued to make claims about its tangible values that are based on symbolic value alone, arguably leaving its communities short-changed. The Bitcoin bros may or may not be less deserving of sympathy, but if art continues to operate within this illiquid system of value, it has to prepare for the inevitable crash.

Cover image: CPallier/Pixabay

Fatima may want to think about cyber for just a minute

Who decides how much culture is enough?

The arts should have seen it coming: theatres and museums were amongst the first to close. Culture proclaimed itself to be in crisis as early as March, and little relief came with the lifting of the first wave of lockdown. The idea that stages and galleries would soon again be full and reemploy the thousands of workers they used to should have solicited some scepticism. 

The art community’s outraged response to a government campaign which suggested that the young ballet dancer Fatima may do well to consider a career in cyber security points to quite the opposite. Earlier, Rishi Sunak attracted the scorn of every artist, technician and arts manager when he suggested that some creatives may have to retrain. He had, after all, told us even in his  ‘good cop’ moments that not all jobs could be saved.

A National Cyber Security Centre campaign from 2019.

Parts of the artistic community thus welcomed the £1.57 billion Culture Recovery Fund with suspicion and a cry of betrayal. Arts jobs must be saved! Dancers have to dance, artists have to make art, curators have to curate… Remember when Trump laughed at the idea that Kentucky coal miners, with their “big beautiful hands”, would retrain as coders? That must be for a different kind of person altogether.

The government, in fact, has little interest in reforming lost artistic souls. Fatima, for example, was not a seasoned professional forced to throw away years of training and experience in pursuit of a suitable post-pandemic job, but part of a 2019 National Cyber Security Centre campaign encouraging school-age girls into careers in the digital sector through training and bursaries. Likewise, Rishi Sunak never suggested that cultural workers turn elsewhere, and ITV retracted the story. Yet the hair-trigger response reveals the art world’s deep and well-founded anxiety.

Some of the meme wars following Fatima’s misleading reappearance.

Supply and demand

Who, then, decides how much art is enough, and who gets to make it, manage it, and critique it before it reaches its audiences? Before the pandemic, some culture fared well in the free markets – think of the commercial successes of West End musicals, for example. Other art forms, like the visual arts or dance, made a good show of looking healthy between diminishing public funding and the infancy of private patronage.

As efficient as markets have been at determining cinema ticket prices and auction results of blue-chip art, they’re no help with an artistic work or experience that actively resists commodification. Culture has long maintained that its price tag is at best a reflection of labour or materiality. The emotional, ethical, or political aspects of contemporary art are more akin to the spiritual and eternal values mediated by religions than the market-driven premiums of fair-trade chocolate or ethical laundry detergent. In art, all products are marketed as ethical, redemptive and transcendental, or as disruptive, life-changing or quite simply genius.

The underlying story of art and artists in the past decades, however, has been one of a dramatic rise in the sheer volume of cultural production. Many more artists produced far more art in Britain in 2019 than at the end of the last century, but public demand had not necessarily kept up. Shepherding the sector into a post-pandemic world will take a lot more than a bailout. 

Let’s fill this town with artists

A major cultural change came at the turn of the century, which saw the arts – and visual art in particular – adopting a new, active role in responding to the mood of society. With new public funding and policy, art became an agent of social amelioration and change. Art schools expanded accordingly to train new armies of artists, and even the economic crisis of 2008 did not deflate their bubble for long. Britain would have all the artists it wanted to – and more.

By the time the public funding landscape changed in 2010, there were more than one eager artists for every job, exhibition, socially-engaged project, or commission available. The teenage Fatima would be well advised to think hard about her choice of career as many practising artists saw their earnings stagnate, and plenty of the younger ones struggled at the bottom rung of the career ladder where opportunities are rewarded with ‘exposure’ rather than cash. All the same, the idea of putting ‘artists first’ espoused publicly by arts institutions continued to cultivate the myth of the artist as a privileged visionary.

Here, art bears an uncanny resemblance to European religions. As parish priest, today’s average artist forgoes the riches of the cathedral or the power of the higher levels of the hierarchy. Their main reward is the respect of their communities, the ability to interpret cultural codes, and the power to ritually deliver supplicants from philistiny and intellectual impoverishment. The aesthetic mission of art tries to keep the same distance from the business of art’s societal impact as the church does between the gospel and its charitable work, which make arguments about the value of cultural enrichment about as complex as critiques of institutions of the church. 

Accounting for taste

What of demand for art and culture? Different sections of society take starkly divergent views of which artistic and cultural practices are desirable. Opera almost always commands significant state subsidies, offering indulgences, the highest levels of redemption for the bourgeoisies. Theatre, perhaps for its ability to speak to the present, has been more likely to pay its way. That Shakespeare’s Globe sustained itself commercially is a sign of the importance of heritage theatre to the national psyche: GCSE Macbeth gets one into purgatory at least.

Not so for all arts. The contemporary visual arts or contemporary dance, for example, could hardly survive at the mercy of their ticket-paying publics and philanthropists alone. It’s public subsidy, and the artificially low costs of artistic labour that have allowed a plethora of loss-making artistic institutions to survive and grow as they have.

Even if no government would diminish the importance of culture to society, it often falls on artists themselves to manufacture intellectually-satisfying levels of public demand for their art. It’s not just marketing, however. When the church struggled to solicit sufficient tithings from parishioners with god’s good news alone, it could always send in the devil as reinforcement. Perhaps to its detriment, art rarely scares its audiences into submission, but its institutions are the prime interpreters and valuers of non-commercial culture. It’s art and artists who decide how much art is enough, and this interpretative monopoly has driven the expansion of the arts priesthood over the past three decades. Knowingly, requests for supply-side subsidies are often framed in the language of demand. Arts Council England, for example, calls for ‘art for everyone’, whether they want it or not. 

Art begat art: the cultural industry reminds us how indispensable is in helping to crush the arts industry.

Some art is better than no art, but more art is not always better than that

None of this has been a bad thing for audiences, and much of the arts was perfectly financially viable before the pandemic, at relatively low cost to the taxpayer. For artistic aspirants like Fatima, the arts offered nothing but encouragement, promising autonomy, the support of a powerful peer group, and offering the chance to change the world and shape public sensibilities – all while doing what one already loves. 

In fact, the industry has been in denial for years. The supply-success of cultural production comes at a relatively low cost to the taxpayer, but not without the level of rot one might have more readily associated with the exploitative aspects of shareholder capitalism. And what’s the one resource that art had no shortage of to address these institutional problems? Naturally, it has been more art. Audiences aren’t visiting your museum? Hire cheaper community artists to visit your audiences. Political art hasn’t yet started the revolution artists were promised at school? Run more social practice projects. Commercial galleries carve up the market leaving most artists without a chance of success? Produce more work critiquing galleries. Museums are corrupt and undemocratic? Have artists produce more institutional critique. Young artists are drowning in debt and waiting tables to make ends meet? Educate more artists so they can problematise the condition to their own unemployability.

Gross culture added

As the pandemic wrecked the cultural industries, a plea from the devil playbook of organised religion called on the public to remember artists in their dark hour. “If you think artists are useless, try to spend your quarantine without music, books, poems, movies or paintings”, cried one meme. This might have worked temporarily, but even if Netflix and Spotify saved the day, there’s still no easy way for the public to value the arts and artists directly should they wish to. As it stands, Fatima’s job is as good as gone, and if the arts dismiss the warning to ‘rethink, reskill, reboot’, they will do so at their peril.

Making the best of a bad situation – culture’s threat to its publics.

In their refusal to deal with their systemic problems, the cultural industries have neglected to develop meaningful narratives of their social value, preferring to instead talk about economic contributions or the imperative of supporting artists in following their calling. The problem they face now is that neither of the arguments is particularly compelling at a time of crisis. Claims of the value of culture based on comparison with the size of the aviation industry have limited appeal, particularly taking into account the cost of diminished earning potential and unpaid student loans of arts graduates and other forms of welfare many artists depend on.

After the flood

One alternative to this battle for scarce resources and symbolic rewards is the Scandinavian model of state-sponsored no-strings-attached stipends for artists, last seen in the UK in the 1980s. For the country the size of Norway, this is an efficient way to support an artistic workforce: the state can effortlessly afford to educate and maintain, say, a thousand artists, and thus take the credit for the success of the country’s top thousand talents, regardless of whether these artists do much at all or not. At scale, this approach is expensive (remember the inexhaustible supply of artistic talent), and prone to making losses on its investments, unless it becomes merit-based and selective at the outset, determining who would become an artist perhaps by restricting the number of arts graduates. 

This latter valve-approach is what DCMS and its Culture Recovery Fund appear to favour. Allocating its cash to commercial organisations as much as to non-profits, Arts Council England nodded to a demand-led recovery, while Oliver Dowden appealed to museums to spend the money in an entrepreneurial manner. Elsewhere, policy announcements signalled a reversal of the supply-stimulating policies that ruled arts and humanities education for the past decades. Governments since 2010 have made it clear that they don’t wish to keep stimulating the supply of art, and on the understanding that the marginal benefit of training an extra artist tends to nil, the arts were sotto-voce singled out as an example of the kind of education the state no longer wishes to invest in.

What next for Fatima?

For many theatres and music venues, the worst may still be yet to come, but neither the assets nor the skills and talents of the arts ecosystem will dissipate this easily. It will take time and be no plain sailing for countless individuals, but where once stood a community arts centre or an experimental production house, we may eventually find a commercial operator who saw an opportunity in the gloom of the pandemic.

A disaster for some, and opportunity for others. Artist Stuart Semple’s Artist Job Centre project may be just one of those that benefit from the chaos.

Fatima can for now remain hopeful that the industry she loves will find some space for her in the future – if she can survive the next year or so, that is. Ironically, although to no consolation, the competition for scarce opportunities and the struggle to become a professional artist may well have prepared her to cope better with the uncertainties of her frayed industry. 

It may be the government’s softly-stated desire that in time, there will be fewer young Fatimas competing for the more market-appropriate number and kinds of artistic jobs, saving the taxpayers money on both supply and demand. Such a policy would be at best short-sighted, but perhaps go some way to demonstrating the evasive values of culture to society just as that culture becomes replaced by something else altogether.

For now, young people will continue to flock to the arts, even with the full knowledge of the sacrifices they might likely endure – not because they didn’t have the talents to become cyber security experts, but because the arts are about the only realm of contemporary life that sometimes still deliver on their promises of authenticity, freedom, and agency.