Detroit’s art museum raises $800 million, saving its art and helping the city escape bankruptcy

The deal late last week to end Detroit’s bankruptcy also means the city’s art museum didn’t have to sell much of its famous art:

As many outlets are noting, the bankruptcy could have been far lengthier, and even more painful for retirees, had it not been for an unusual deal designed to save the Detroit Institute of Arts while minimizing cuts to pensions. The museum has been owned by the city since 1919, and its collection, appraised at $4.6 billion, includes works by the likes of Rembrandt, Van Gogh, and Matisse, as well as Bruegel the Elder’s masterful The Wedding Dance. In April 2013, the city’s governor-appointed emergency manager, Kevyn Orr, informed the DIA that it would have to contribute at least $500 million to paying off Detroit’s debts, even if meant selling off paintings at auction. Creditors also demanded a sale, because, you know, they’re creditors.

Instead, the museum essentially went on an ambitious fundraising drive, in which it managed to raise more than $800 million, including $330 million from nine different philanthropic foundations. Another $200 million came from the state of Michigan, which, despite Gov. Rick Snyder’s protestations that he wouldn’t bail out Detroit, did apparently feel compelled to preserve some of its cultural heritage.

In return for the money, the deal will essentially “ransom the museum from city ownership,” as the New York Times puts it, placing it in control of an independent charitable trust.

It sounds like foundations and others that gave money to the art museum not just helped preserve the museum’s finer pieces but also raised extra money for the museum. Given that many urban supporters these days laud the positive influence of arts on urban development, perhaps the museum can play a bigger role in helping to revive downtown Detroit with some of that extra money.

At the same time, it is interesting to consider some of the tradeoffs in Detroit leaving bankruptcy: is it better to preserve art (often something passed down from generation to generation) or to cut the pensions of employees and retirees? Save big culture or provide more money for people living in the community? Perhaps this is an overly simplified comparison but raising hundreds of millions for art could have very different outcomes than raising that money to help residents.

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