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feature new York vs. london
Frieze Art Fair vs. Armory Show GB Pound vs. US Dollar
Frieze is in its fifth successful year as London’s premier art fair, and the Of course million-dollar artists and art fairs alone do not a market make.
only one produced by the publishers of an art magazine, which has Anyone looking at the relative economies of New York and London
always given it something of an edge over fears of art fairs becoming won’t fail to notice that the dollar has dropped to its lowest against the
just another tradeshow. With Matthew Slotover and Amanda Sharp pound since the latter’s heights in late 1980. What the current roughly
at the helm, one remains (reasonably) sure that the art comes first, two-to-one ratio means in practice is that New York is essentially on
and will continue to do so for some time to come. Plus, Regent’s Park sale for the British (not to mention for all citizens of euro-denominated
is by far one of the more beautiful settings for any circus of this sort, countries). This keeps New York collectors at home and looking only
especially when compared to the Hudson River pier that New York’s to their own market, while their counterparts across the Atlantic can
Armory Show has called home since 2001. And given the latter’s near cast their nets far and wide, not only at auction but also on the primary
sale to Merchandise Mart Properties, the Armory may soon have to market, where works by American artists are effectively 20 percent less
work hard to dissociate itself from ‘National Kitchen and Bath Month’ than what they were as recently as 2001.
Of course, the dollar’s decline could also hamper London’s rise,
Hirst vs. Koons especially if the 80 percent of the art market that just “is New York”
During the early 1990s, Jeff Koons and Damien Hirst embodied the decides to stay home. Which is why the purchase of London’s Haunch
impulses of Eros and Thanatos for the artworld: Koons gave us his of Venison by Christie’s, and its opening of a new Haunch space in New
Made in Heaven series (1989–91) and all of its many ‘shots’ of the artist York, appears that much more timely. Christie’s gets a highly touted
coupling with his then-wife-cum-porn-star-cum-Italian-Parliament- outlet through which to route both primary and secondary market
candidate Cicciolina; Hirst gave us an encased cow’s head (A Thousand private sales, and Haunch gets a forum in which to court American
Years, 1990) and then an oversize fishtank filled with formaldehyde and collectors who may be a bit insecure about their limping currency. What
one unfortunate shark (The Physical Impossibility of Death in the Mind is more, it is only Christie’s that has to weather charges of ‘conflicts of
of Someone Living, 1991). And more than any other artists of their interest’ with its entrance into the primary market for contemporary art.
generation, Koons and Hirst gave us a new medium: the market. Sure, As far as HOVNY is concerned, it’s business as usual
the 1980s had flooded the contemporary art market with new money,
but Koons and Hirst seemed to recognise that, again, it was visibility ‘Non-Doms’ vs. Capital Gains
which mattered: visibility would quite literally ‘make’ the market and the If currency is a two-way street, tax policy is not, and at the moment, both
art to go with it. New York and London have been the beneficiaries of tax loopholes
As with any artistic medium once discovered, though, the that cater to the kinds of people who like expensive things, or can learn
challenge became one of how to manipulate it, of how to put it through to. In New York (and the US more generally), the loophole has to do
its paces and to exercise its full possibilities. No one can doubt that with what partners at hedge funds and private equity firms declare as
Hirst has risen to the challenge and confronted it ‘head-on’, so to speak, long-term capital gains, which are taxed at a 15 percent rate for the
with his $100 million luxury provocation, For the Love of God (2007). highest tax bracket, and what they declare as income, which is taxed at
Koons, however, appears to have regressed into a fantasyland of a rate of 35 percent for the highest earners. Since most of these funds
childhood escapism, one apparently populated by balloon animals, follow what is referred to as a ‘2 and 20’ fee structure – where the funds
paintings of the Incredible Hulk and a 161-foot-tall choo-choo train. charge 2 percent of all assets under management and take 20 percent
Eros? More like infantile. of any profits (some of the best-performing funds take even more)
– the partners in these operations claim not to be earning any ‘income’
at all; rather, they only realise capital gains, and so take home 20 percent
more of their earnings at the end of the day.
Both New York
Not a bad racket. But not quite as good as the deal these same
fund managers and private equity partners could get if they moved to
London and declared ‘non-dom’ status. ‘Non-doms’, or non-domiciled
and London cater
foreign nationals, pay zero tax on capital gains. What this means is that
London (and the UK in general) has effectively become one of the
biggest tax havens in the world. Small wonder then that the London
to the kind of
auction markets did not dry up last year when Britain finally harmonised
its droit de suite laws with its fellow EU member states. A 5 percent
artist’s royalty on the purchase of works of visual art is easy to swallow
people who like
when your bank account grows by upwards of 30 percent for a simple
change of address.
Of course, New York remains unmatched when it comes to the
expensive things –
size of its contemporary art scene. It is still the first stop for most artists
fresh out of their MFA programmes (sorry LA); and with the expansion
of new spaces to the Lower East Side, and the continued dominance of
or can learn to
Chelsea as a Mecca of artistic visual pleasures, there is only so far the
Big Apple can fall. As the critic Ken Johnson (now once again with The
New York Times) noted of art being made ‘at the margins’: ‘If it’s any
good, and it hasn’t made its way here yet, it will.’ I think I’ll stick around.
artreview 70
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