Part 8 – Introduction to the #7/11 Project

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Before introducing the #7/11 Project,  a quick reminder of what it is about the Latency Problem that makes it so difficult to solve:

The increase in value for an Artwork is a process. A successful solution must facilitate that process, not attempt to tax it or circumvent it.

What does ‘facilitate’ mean? It means working with the problem in designing a solution that is mindful of its characteristics and of the economic and legal realities within which it exists. In a communist economy, a state imposed adjustment like Resale Royalties Legislation might work, but in a capitalist economy with free movement of goods and services across multiple jurisdictions it seems much less realistic, with outcomes varying from non-payment of royalties owing (see article from ‘The Lawyer’ magazine here), tax-breaks or lower % returns to Artists, and relocation of services to more favourable jurisdictions.

Part and parcel of this consideration, is that some ideological concession to the idea of Art as a commodity is necessary for an Artist to earn a living from their practice, and for us to move toward a realistic solution that works for Artists, and their buyers.

Let’s also remember that once a one-off Artwork is sold, it has become somebody else’s property. End of story. So selling it, or should I say selling 100% of it, means that the Artist  disenfranchises themselves of a share in the Latent Value of the Artwork.

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And that is the starting point for the #7/11 Project… That an Artist sells a percentage share of an Artwork, not the whole thing.

Let’s take look at what selling percentage shares might achieve, by imagining a different outcome for the Rauschenburg / Scull sale. If the option had been there for Rauschenburg to sell 45% of ‘Thaw’ in 1958, he would have earned $405 as a working artist then (based on the sale price of $900), but he would also have retained a 55% interest in the Latent Value of the Artwork, so that, in 1973 he would have earned a further $46,750 from its sale at auction, with Robert Scull netting the remaining $38,250.

But why would Scull want to buy only a 45% share of Thaw? And where would the Artwork be displayed? How would transactions be made and who would oversee them? In Parts 9 and 10, I will try to answer some of these questions and explain how this core concept could solve an age-old problem.

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