Rent Seeking

Last year Brandeis University, facing a big cash flow problem, considered selling its art collection. It planned to close its Rose Art Museum and sell the entire college. Then alumni and donors became very concerned and threatened to withhold funds. So Brandeis backed off.

Well now the school has a new plan. According to an article by Geoff Edgers in the Boston Globe:

Brandeis University… now plans to hire Sotheby’s auction house as a broker to raise money by loaning out artworks, the school confirmed yesterday.

Such loans from the Rose’s prized collection, if they take place, would help Brandeis avoid selling the works outright.

When museums “loan” out pieces generally the only actual money exchanged has to do with insurance and transportation. But this is something on an emergency.

Lichtenstein.jpg

Apparently Brandeis has an annual deficit of up to $15 million. This is because many, many of the school’s major donors had their money “invested” with Ponzi schemer Bernie Madoff.

The Brandeis collection is worth some $350 million and includes paintings by major artists like Henri Matisse, Willem de Kooning, Roy Lichtenstein, and Andy Warhol.

It’s unclear how Sotheby’s plans to manage the renting of the art (who or what would rent the Brandeis pieces or how much they would pay). According to the article, the chairman of Sotheby’s said vaguely that that the Brandeis lease scheme is “likely to be modeled on loans made to other museums.”[Image via]

Daniel Luzer

Daniel Luzer is the news editor at Governing Magazine and former web editor of the Washington Monthly. Find him on Twitter: @Daniel_Luzer