Art market gets ugly as indigenous bubble bursts

Posted by Aboriginal Art Directory | 01.08.10

Author: Nicolas Rothwell
News source: The Australian

It began with a bang just over a decade ago in the lush years of fast-paced economic growth, faltered in the global financial crisis, and was quietly, sadly laid in its grave over the past two weeks, its funeral marked by a set of bleak auction results.

The Aboriginal art boom has run its course. Indigenous art-making in Australia will live on, but it will never be quite the same again. The old masters are dead or dying, the traditional cultures of the Centre and Top End are shifting, the art sector is changing, a page is being turned.

But not all the troubles of the indigenous art market are the result of these grand, long-term processes. Three commonwealth government reforms have helped destroy Aboriginal art's once-strong investment appeal. Gallerists, critics and collectors have looked on in amazement as bureaucrats have reshaped the Aboriginal art world, imposing regulatory constraints and reporting burdens on the once-freewheeling trade.

"The market's not exactly dead," says prominent Brisbane indigenous art gallery owner Suzanne O'Connell, "but it's certainly ailing.

"It's in need of a considerable blood transfusion, and fast. A handful of big-name artists are still selling, but buyers are bargain-hunters now."

According to figures compiled by Australian Art Sales Digest, total sales of Aboriginal art at auctions in Australia soared from less than $1 million in 1994 to a peak of $23.9m in 2007. As the financial crisis struck, sales crashed to $11.7m in 2008 and $10.9m last year. This year, just $5.7m worth of Aboriginal art has been auctioned.

The suite of governmental interventions lies at the heart of the present chaos. At the start of this year, Arts Minister Peter Garrett launched a separatist code of conduct, applying complex rules to indigenous art-makers and dealers in a bid to weed out "carpetbaggers", the corrupt cash traders who buy art on the cheap and resell it at high cost. The voluntary code has spawned a feast of consultations. Carpetbagging continues to flourish even as the high-end market contracts.

In mid-year, Garrett's long-promoted resale royalty came into force. This measure, conceived to help impoverished indigenous artists, imposes strict rules on the art market and requires payments to the artists or their descendants when a painting changes hands.

It raises business costs and places galleries, dealers and resellers under the supervision of a privately owned agency, in effect a tax-farming office with sweeping investigatory powers.

The royalty is already having unintended consequences. Traditional artists, with large families and obligation networks, are being required to write wills, and favour particular relatives. And most experts believe the scheme will kill off the "cultural gifts program", a genteel tax minimisation system that has seen collectors give Australian museums and state galleries almost $600m worth of art, much of it indigenous, over the past 30 years. For who will give if they have to pay for the privilege?

.....

This is what the best intentions of the cultural architects in Canberra have helped create: a confused, disturbed social and trading environment. Falling prices, abrupt vogues, anxious sellers -- the last stages of a market bubble are not a pretty sight.

URL: http://www.theaustralian.com.au/news/nation/art-market-gets-ugly-as-indigenous-bubble-bursts/story-e6frg6nf-1225899246377


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