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Kindred Spirits: Art And Money


What would the lions in front of the New York Public Library fetch at auction? This seems a reasonable question, given that the New York Public Library recently sold off one of the most celebrated paintings in the city, “Kindred Spirits” by Asher Durand -- hanging for decades in the main library, now being shipped, astonishingly, to Bentonville, Arkansas, hometown of Wal-Mart. Will it become Wal-Art? Are the two marble lions next?

The daughter of the founder of Wal-Mart, Alice Walton, bought "Kindred Spirits" this month reportedly for at least $35 million, the highest price ever paid for a painting by an American artist -- though, since it was bought at a "silent auction" at Sotheby's, the parties involved are denying the public even the right to be told what the precise purchase price was, much less have any say in the disposition of what we previously were told was a public treasure.

Art-lovers have reacted with outrage. Francis Morrone in the New York Sun called it "New York's most egregious act of self-desecration since the demolition of Pennsylvania Station," Michael Thomas in the NY Observer deemed it a "sorry affair," a "scandal", a "dirty deed," and an example of "institutional philistinism"; to the library's explanation that the sale was needed to raise funds for book and manuscript acquisition, he wrote: "I find the arithmetic unpersuasive." New York Times art critic Michael Kimmelman condemned the sale in three separate articles (so far), labelling the painting “a civic landmark,” and arguing , with a kind of eloquently restrained anger, that it should at least have been kept in New York. The painting certainly has New York all over it: In it, the (New York) painter Thomas Cole stands on a ledge with the (New York) poet William Cullen Bryant in the (New York) Catskills. “A grand inherent irony” of the sale, CBS correspondent Morley Safer added a few days later, is that “all that Wal-Mart money was gleaned from the systematic destruction of the very American landscape Ms. Walton so expensively celebrates.”

A week after the sale of “Kindred Spirits,” a front-page article in the Times questioned the decision by the New York City Opera to allow “Atsushi Yamada, a one-time Sony salaryman without conservatory training or a single English-language review to his name” to conduct the company in a tour of Japan for which Yamada helped raise nearly $2 million from Japanese businesses.


"Kindred Spirits" by Asher Durand -- from NY Public Library to Wal-Art in Arkansas

Both stories are but the latest incidents to suggest that, public institution or not, money is what matters these days in the arts. Examples abound. Cultural institutions are now much more likely to be named after people with money than people with talent: On Broadway, the Helen Hayes, the Gershwin and the Eugene O’Neill Theaters have been joined by the American Airlines Theater, the Ford Center for the Performing Arts, and the Cadillac Winter Garden; this month, Gerald Schoenfeld renamed one of the theaters he owns as chairman of the Shubert Organization after himself. Museums offer exhibitions that are little more than paid advertisements for the corporations that gave money to mount them: "Every year, in one way or another, museums test the public's faith in their integrity," Kimmelman wrote recently, in an article entitled "Art, Money and Power", which laments such cultural commercials as the Metropolitan Museum of Art’s “current Chanel-sponsored Chanel show, a fawning trifle that resembles a fancy showroom."

Why is this happening?

One can chalk it up to our commercial culture, which finds money more interesting than mere art. Type “art and money” into Google, and get more than 70 million results. Type "art and beauty"? "Art and meaning"? Nowhere near as many. This is why supporters of the arts have learned to sound like economists -- talking about the arts as an “economic engine” etc. -- a book is more likely to make the news if its author gets a big advance, and a movie these days is judged primarily by the money it makes; is there a newspaper in America that doesn't now list weekend movie grosses?

But there is another reason -- the arts are desperate for funds.

The Budget Ballet

It is certainly relevant to point out that Mayor Michael Bloomberg’s proposed budget for the arts this coming fiscal year, about $105 million, is 12 to 15 percent less than last year's budget (depending on whose analysis you read); and the budget for the public libraries of New York, separate from the one for the arts, shows a decrease of about 10 percent from the previous year. (Reading the library budget is complicated by a Byzantine accounting procedure by which a huge chunk of funding from last year has been deemed “prepayment” for the coming year.) But it would be misleading to focus exclusively on the 2006 executive budget.

For one thing, the mayor and the City Council are still in negotiations, and the exact amounts will change by the deadline of June 30th. For another, the budget process is almost a kind of performance art -- a budget ballet, where the mayor cuts, and the City Council restores -- repeated with little variation year after year.

The bottom line is that the bottom line hasn’t changed much in the city, no matter who the mayor is. Just look at the numbers: The supposedly pro-arts Mayor Bloomberg is proposing to spend $105.4 million on the arts in fiscal year 2006, out of a total operating budget of nearly $50 billion. Eleven years ago, under the supposedly anti-arts Mayor Rudy Giuliani, the arts budget was $96 million -- just $10 million less, at a time when the total operating budget was some $18 billion less. In other words, the percentage of the total operating budget dedicated to the arts in fiscal year 1995 was less than a quarter of one percent. The percentage of the total operating budget dedicated to the arts in fiscal year 2006 (even after the inevitable additions negotiated with the City Council) is sure to be even less than that.

What Ever Happened To The Poor, Pure, Starving Artist?

Linda Ferber does not complain about the funding. “The city is a great partner,” she says. Still, she has to acknowledge that money is tight. “All cultural institutions work very, very hard to program within limits.”

Ferber is a museum curator, currently for the Brooklyn Museum, soon to be the director of the museum at the New-York Historical Society. Right now, she is walking in a high-ceilinged gallery on the second floor of the society, where she is serving as the guest curator for "Nature And The American Vision," an exhibition that coincidentally opened the same week as the sale of "Kindred Spirits" and includes, among other exemplary works from the Hudson River School of New York-based landscape painters, some two dozen paintings by Asher Durand.

"This is an early Durand," she says, stopping at a painting from 1844, called "The Solitary Oak." "Look at the light, the luminous glow," she says. "It confers on that tree an almost religious aura."

A century and a half after Durand created it, the painting now has a special aura for a different reason. "The record price for an American painting is considered newsworthy," Ferber says, "and people will become curious about the painter."

For all her savvy and experience, Ferber was shocked when she heard the news about the sale of Durand’s masterwork to the Wal-Mart heiress. She had been planning the first major retrospective of Durand's work in three decades, an exhibition scheduled to open at the Brooklyn Museum in 2007. “Before this sale, one could have put together an entire show just from what was available in New York -- that’s how much of a New York artist he was,” Ferber said. “Now, a key work has gone.” The library had promised to lend "Kindred Spirits” for the Brooklyn Museum show. “We hope we’ll still be getting it,” Ferber says.

She cannot remember a time when she didn’t know about “Kindred Spirits.” ”It’s such a famous image that a lot of people who would recognize the painting probably don’t know who painted it.” Durand was commissioned to create “Kindred Spirits” a year after Thomas Cole’s death as a gift for William Cullen Bryant. (It was Bryant’s daughter who eventually gave it to the library.) The title, meant to commemorate the friendship between Cole and Bryant, comes from a phrase in a poem by John Keats, who believed the "highest bliss" is Nature enjoyed by "two kindred spirits."

It is easy to consider all the lofty devotion to art and beauty and Nature that emanates from this one painting, and to wonder -- in this age of artist as entrepreneur -- what has happened to the idea of the poor but pure artist? Where is today’s Vincent van Gogh, who sold only one work of art during his lifetime, but who eventually changed the way we look at art –- and, ok, whose “Portrait of Dr. Gachet” was sold in 1990 for the highest price ever paid for a painting, $82.5 million (a figure surpassed last year by Picasso’s "Boy With A Pipe," which sold for $104 million)? Are the only “kindred spirits” these days art and money?

To art historians like Linda Ferber, the poor, pure artist has always been “a romantic image” -- a polite way of saying fake -- creating a misleading sense of artists as being apart. The truth is, of the four artists connected to the painting “Kindred Spirits,” only John Keats fits the image – broke…exploited…starving…tubercular, dead at 25. (And even he studied to be a surgeon.) Thomas Cole, though he died relatively young at 47 after a sudden illness, was America's most successful landscape painter. William Cullen Bryant, in addition to being a poet, was a lawyer, editor and part owner of The New York Evening Post, who helped in the creation of both Central Park and the Metropolitan Museum of Art.

And Asher Durand?

"He made money," Ferber explains. "Literally."

Durand was an engraver who created the intricate designs for banknotes. Even after he switched careers, he helped found and was president of the National Academy of Design, part of whose purpose was to nurture the marketplace for art. ”Durand was in the best sense of the word an organization man,” Ferber says.“He was a dedicated artist, but he was also a pragmatic businessman.”

His paintings helped inspire people to start touring the countryside, which led to the birth of an entire industry, tourism. But he was such a New Yorker that, while on a grand tour of Europe, he wrote home: “I shall enjoy a sight of the signboards in the streets of New York more than all the pictures of Europe.” There is no evidence that he ever set foot in Arkansas.

 

 

 

Frequently Unasked Questions About The Budget


Why is the mayor smiling?

Every year since he took office in 2002, Mayor Michael Bloomberg has faced a budget deficit, and responded by cutting libraries, closing firehouses, and raising taxes. Now the city is expecting to end this fiscal year (on June 30) with a $3.3 billion surplus - one of the largest surpluses in city history, even bigger than the ones Giuliani had during the dot-com boom years.

"We have a reason to have a grin on our face," said Bloomberg.

Should the average New Yorker be smiling?

It depends. Using the budget surplus of $3.3 billion from this year, Mayor Bloomberg is trying to give nearly everyone in the city something to be happy about in his proposed budget, called the Executive Budget, for fiscal year 2006, which begins on July 1, 2005. No mayor has ever tried to spend so much surplus money in a single year, according to Elizabeth Lynam of the Citizens Budget Commission.

The mayor and the City Council must agree on the details of this budget by June 30.

What is he proposing?

The mayor is proposing $500 million worth of tax cuts. He will ask the State Legislature in Albany to cut the sales tax on clothing and shoes under $110 from 8 to 4 percent. Bloomberg is also giving a $400 rebate to those who own a home, co-op, or condo, just as he did last year.

In contrast to previous years, when he proposed cutting senior citizen programs, the mayor wants to spend $17 million more on senior centers and meal delivery programs. Instead of threatening to close zoos, as he did in the past, he is proposing money to renovate them.

The mayor's 2006 budget (which begins July 1, 2005) would:

  • Increase the city's education budget by $800 million, with new money for class reduction and intervention for struggling students, and expanded advanced-placement programs.
  • Provide money to renovate 125 firehouses and six police stations
  • Institute more frequent trash collections
  • Resurface 8,000 miles of city streets
  • Construct 10,000 homes and preserve 5,000 more
  • Allocate $21 million more for summer youth job programs
  • Give libraries a $7 million increase
  • Give $27 million to Lincoln Center for redevelopment projects, $25 million to the Queens Museum to expand and $21 million to the American Museum of Natural History for improvements "in the Genomic and Ornithology Departments."
  • Provide $12.5 million in tax incentives for film production and $130 million for the development of the Greenpoint/Williamsburg waterfront
  • Renovate hospitals, parks, and museums.

Why does the city have a surplus when a few years ago it had a $6 billion deficit?

The economy has improved and tax revenues are higher than expected.

The city's economy has recovered from the downturn that occurred after the terrorist attacks of September 11, 2001. Wall Street profits, which account for about a third of the city's tax revenue, brought in twice as much to the city's coffers in 2005 as in 2002.

The real estate market is strong, and the city charges a transaction tax every time a property is sold or refinanced.

And the increases in the personal income tax, sales tax, and property tax that Mayor Bloomberg instituted in 2002 and 2003 have also generated a large windfall of money.

Who's not smiling?

Two groups -- fiscal watchdogs and city workers -- are not happy.

Why aren't fiscal experts happy?

Many budget experts argue that the mayor is thinking more about the election in November than about future deficits.

"Taking a $3.3 billion surplus and spending it all next year is pretty short-sighted," said Charles Brecher of the Citizens Budget Commission. "To have a surplus of that size and not use a penny of it to pay off debt... it's a spending spree."

By next year, all of the surplus will be gone.

In fiscal year 2007 (which begins July 2006), the city expects to have a $4.5 billion deficit. In fiscal year 2008, the mayor projects a $4.2 billion deficit.

Why aren't unions happy?

Teachers, police officers, firefighters, and other city workers - who are all seeking new contracts and raises - say the mayor is leaving them out of the budget.

"Their priorities are out of whack," said Randi Weingarten of the United Federation of Teachers. "This is the largest surplus ever. Yet, there is not a single penny for teachers, police officers, firefighters or other municipal workers."

To the unions, the mayor replied, "We don't have the money."

Why does the mayor say he doesn't have the money for unions?

The Bloomberg administration reportedly offered the teachers, police officers, and firefighters a five percent wage increase over three years - the same amount he gave to District Council 37 city employees last year - which city officials estimate would cost the city $650 million a year. (Officials also asked for work concessions.)

The unions representing teachers, firefighters, and police rejected the mayor's offer as inadequate to keep and attract employees when they can earn so much more in the surrounding suburbs.

Rather than using the surplus for larger pay raises, Bloomberg plans to give some of the money back to taxpayers.

The mayor wants to repeal the city's sales tax on clothing, which will cost $256 million a year. The property tax rebate costs $230 million a year. And the personal income tax surcharge for individuals earning more than $100,000 - which generates about $600 million a year for the city - is set to expire.

Even though the mayor isn't giving city workers raises, the city's labor costs are rising by 20 percent.

Pension costs are the fastest growing share of the budget. According to the mayor's office, pension and fringe benefit costs rise five percent each year; by the year 2008, the city will pay $10 billion a year in pensions or about 20 percent of the annual budget. The state, not the city, controls pensions.

Other costs are rising as well.

Unlike most other cities in the nation, New York City is required to pay a portion of the state's Medicaid costs.

Where does the mayor get these budget numbers?

Projecting future revenues and expenses is not an exact science. The city uses a variety of economic models to try to predict what will happen, but politics also come into play.

The City Council complains that the mayor purposely underestimates tax revenue, because the mayor doesn't want the city's budget situation to look too rosy, or the state and federal government will be less likely to send aid.

The budget is also negotiated and modified throughout the fiscal year, which begins July 1.

In the fall, city agencies, after consulting with community boards, submit their budget requests. In January, the mayor releases what is called the Preliminary Budget, which shows how much the city expects to spend and projects how much tax revenue will come in each month. The community boards, borough presidents, and the City Council all make recommendations.

In the spring, the mayor presents a revised budget, called the Executive Budget. The mayor then negotiates the details with the City Council, a frequently contentious and theatrical process.

Both sides must reach an agreement for a balanced budget by June 30.

BudgetHow will the next mayor deal with the future deficits?

Mayor Bloomberg's "good news" budget was difficult for his political opponents to criticize, but they all said they would do something differently if elected in November.

C. Virginia Fields did not issue an official response to the mayor's budget, but she has said, if elected, she would give city workers raises.

Anthony Weiner said he would institute a tax on people making more than $500,000 a year.

Fernando Ferrer criticized the mayor for allowing lawmakers in Albany to postpone action on the Campaign for Fiscal Equity lawsuit, which requires an increase in funding for education. He has called for a tax on Wall Street to help fund education.

City Council Speaker Gifford Miller took credit for the decrease in the sales tax, which the City Council has proposed in previous years. He believes that the personal income tax surcharge on people who make more than $500,000 a year should continue.

Bloomberg wouldn't even try to explain how the next mayor -- whether it is himself or someone else -- should address the future deficits.

"I do not have a good answer for you on how we are going to come up with an extra $4.5 billion," he said.

Related Articles:

The 2006 Preliminary Budget

State Budget, On Time But Imperfect. Also ' City Budget; City Performance

State Debt + Federal Debt = City Budget Trouble

Caution: Budget Pitfalls Ahead


 


Related:
• Frequently Unasked Questions About The Budget

• The Mayor's Budget Has No Big Ideas; The Council's Does

Thanks to a higher-than-expected wave of tax revenues, Mayor Michael Bloomberg last week presented an executive budget that reduces some taxes and reverses some spending cuts that he had proposed earlier. He is able to do this, he says, because there is now an estimated $3.3 billion surplus for the current fiscal year, which began in July 2004.

But the mayor does not use this record surplus to launch expensive new programs or propose big tax cuts--certainly temptations in an election year.

There are good reasons for the mayor's caution. The budget plan projects that the following fiscal year, beginning in July 2006, will have a gap of $4.5 billion.

The mayor and City Council have tamped down growth in spending on most city services, such as police, sanitation, and programs for seniors. But other expenditures have grown significantly and some are likely to continue to grow: Medicaid, debt service, and pensions and other fringe benefits for city employees. The mayor often calls these items nondiscretionary or uncontrollable costs. He is right -- to a point.

In the near term, there is not much the city can do to ease expenditures on these items. This spending is locked in by law, prior commitments, or collective bargaining. So the fixes cannot be quick or unilateral. But, while the city has taken some steps, unless it increases its work on bringing these costs down, makes very large cuts to other programs and services, or finds new or unexpected revenue, we could soon find ourselves in deep trouble. Here are the pitfalls ahead.

MEDICAID

The mayor expects this health-care program for low-income people to cost the city $4.9 billion this year and $5.5 billion by 2009. Decisions about Medicaid spending are made in Washington and Albany, not City Hall. The recently adopted state budget offers some relief by capping the rate of growth in city spending on Medicaid. But that assumes the state will be able to pick up a larger portion of the tab, an assumption that could fall victim to the state's own fiscal problems. Even if the assumption holds, New York City must still shoulder a far bigger share of Medicaid costs than other cities around the country.

To lower the Medicaid burden, some people have suggested that the city be less active in helping people to enroll in the program. But this could result in more uninsured New Yorkers using the city's public hospitals. Last year, the public hospitals provided about $200 million of unreimbursed care for the uninsured, part of the reason the system is facing its own budget shortfalls and the mayor and the City Council decided to increase the city subsidy to the hospitals.

PENSION PROGRAMS

The city's ability to rein in pension costs for its employees is also complicated. The mayor projects that the city's contribution to pension costs will jump from $3.4 billion this year to $5.0 billion in 2007, before declining as the funds' strong investment gains in 2004 are phased in. The city will still be spending more long term because of decisions made in Albany, such as providing a cost-of-living adjustment for retirees, and demographic changes, such as longer life spans. One way to ease future pension costs is to move from a pension plan where people are guaranteed a certain benefit to one, resembling a 401K, where they make a set contribution but are not promised a guaranteed benefit amount when they retire. But again, that is not just up to the mayor, the unions must agree as well.

EMPLOYEE FRINGE BENEFITS

The mayor anticipates that the costs of fringe benefits for city employees will grow steadily from $5.2 billion in 2005 to $6.5 billion in 2009. Some have proposed that city workers make larger co-payments to their health plans as a way to rein in the cost of benefits to the public. Here, too, the decision is not the mayor's alone. The unions must also agree.

DEBT

Of all these growing spending items, debt service costs may be most under the city's direct control. But even here, fixes take time and may make matters worse in the short run. The mayor estimates that debt service—the payment of interest and principal on the funds the city borrows to build or repair its infrastructure—will rise from $3.3 billion this year to $4.9 billion by 2009.

While the city cannot undo its obligations from prior borrowing (and further opportunities for refinancing are limited), it can borrow less in the future. But this is easier said than done considering the city's needs for new schools, road and bridge repairs, and the like. The city could also eliminate what some might describe as discretionary capital spending on cultural institutions, stadiums, and so forth. Additionally, the city could forgo some borrowing and undertake more capital projects on a pay as you go basis, although this approach reduces the funding available for general operating expenses.

CONTRACTS AND SCHOOLS

At least two other potentially hefty costs lurk on the not-too-distant horizon. Police, fire, sanitation, and corrections officers, along with teachers, continue to work with expired contracts, and pacts with the rest of the city's unions begin to run out this June. Although the budget includes some funds set aside in anticipation of the settlement of these contracts, agreements will likely come at a higher cost.

The eventual resolution of the Campaign for Fiscal Equity lawsuit on school funding also continues to pose risks for the city's budget balance. With Governor George Pataki's decision to appeal the lower court ruling, a settlement is unlikely until at least next year. But the ultimate costs to the city could be large given that a court-appointed panel determined that spending should increase over four years so that it will be $5.6 billion higher (adjusted for inflation) than in the current year. If the city were required to fund one-quarter of that increase, as in an example presented by CFE, the city's share could eventually be over $1 billion annually.

Given the high and growing costs to the city for Medicaid, debt service, and pensions and fringe benefits for city workers along with potential new costs from labor and CFE settlements, there are ample reasons for the mayor's cautious approach to the 2006 budget. This year's large surplus does not guarantee that balancing the city's budget in future years will be easy.

Doug Turetsky is chief of staff and communications director of the New York City Independent Budget Office.



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