Take Solace in Art

Anxious and nettled by national politics and crime in high places? The wise know at these times to be anxious and nettled instead by [the discontents of] art and culture, the most important sphere of public affairs. OK, not the most important, but still, consider health policy: surely very important…but if life isn’t worth living, why bother to make it longer?

The amazing shenanigans at the Getty Museum are all about a compulsion to acquire art, including a lot of art that is almost never shown, that museums have substituted for a lot of other things they could do with their collections that would result in more engagement by more people with better art. Shouldn’t that be the overarching standard for judging cultural institutions’ behavior?

This goal displacement, in my view, is abetted by an accounting convention of which few people outside the business are aware. If you look at the balance sheet of a museum, you will find that its art collection is invisible. Museums typically do not evaluate (in money) nor report collections as assets. This odd practice has been intermittently a lively issue in accounting circles, and is at issue again before the FASB, which establishes accounting practices for practically everyone.

The numbers involved are quite remarkable; I estimate (very roughly) that (for example) the collection of the Art Institute of Chicago is in the dozens of billions of dollars. Simply recognizing collections as assets, using imperfect but adequate and practical valuation mechanisms, could have a lot to do with getting museums to create much more value than they do.

For example, a museum like the Art Institute could endow free admission forever by selling about 1% of its collection (the least artistically important 1%, of course). These works would almost certainly go from storage now to being on view somewhere else, so the deal would probably be a gain on both ends. And judicious selling of collection items seems to be becoming a habit with museums lately.

There’s no guarantee that capitalizing collections, which could be done with useful accuracy at manageable cost, would actually cause behavioral change in the art world, but it would at least make it possible to ask quite reasonable questions. For example: “I see we’ve entrusted you with so-and-so many billions of dollars worth of precious capital. What value are you creating with it? Is that a lot; should we give you more resources to employ…or a little; perhaps some of it should be in more creative and productive hands?” These are good questions grownup managers should be happy to answer.

I think the effects would be almost entirely positive, a view elaborated in the paper at this link.

Author: Michael O'Hare

Professor of Public Policy at the Goldman School of Public Policy, University of California, Berkeley, Michael O'Hare was raised in New York City and trained at Harvard as an architect and structural engineer. Diverted from an honest career designing buildings by the offer of a job in which he could think about anything he wanted to and spend his time with very smart and curious young people, he fell among economists and such like, and continues to benefit from their generosity with on-the-job social science training. He has followed the process and principles of design into "nonphysical environments" such as production processes in organizations, regulation, and information management and published a variety of research in environmental policy, government policy towards the arts, and management, with special interests in energy, facility siting, information and perceptions in public choice and work environments, and policy design. His current research is focused on transportation biofuels and their effects on global land use, food security, and international trade; regulatory policy in the face of scientific uncertainty; and, after a three-decade hiatus, on NIMBY conflicts afflicting high speed rail right-of-way and nuclear waste disposal sites. He is also a regular writer on pedagogy, especially teaching in professional education, and co-edited the "Curriculum and Case Notes" section of the Journal of Policy Analysis and Management. Between faculty appointments at the MIT Department of Urban Studies and Planning and the John F. Kennedy School of Government at Harvard, he was director of policy analysis at the Massachusetts Executive Office of Environmental Affairs. He has had visiting appointments at Università Bocconi in Milan and the National University of Singapore and teaches regularly in the Goldman School's executive (mid-career) programs. At GSPP, O'Hare has taught a studio course in Program and Policy Design, Arts and Cultural Policy, Public Management, the pedagogy course for graduate student instructors, Quantitative Methods, Environmental Policy, and the introduction to public policy for its undergraduate minor, which he supervises. Generally, he considers himself the school's resident expert in any subject in which there is no such thing as real expertise (a recent project concerned the governance and design of California county fairs), but is secure in the distinction of being the only faculty member with a metal lathe in his basement and a 4×5 Ebony view camera. At the moment, he would rather be making something with his hands than writing this blurb.