The big news out of Detroit yesterday was the announcement that the Big Three automakers have pledged $26 million towards the "grand bargain" to save the DIA's collection. I may not have been that impressed with their legal papers, but the museum's PR game is beyond reproach. As Matt Helms and Mark Stryker point out, the grand bargain didn't grow at all with this announcement; instead, this represents part of the $100 million the DIA had already committed to raise towards the deal. But it's very shrewd of them to trumpet this as a great success, and to create a sense of inevitability about the whole thing. Well played.
It's always struck me, though, that there is an inherent tension in the whole idea of the "grand bargain."
On the one hand, we keep hearing that the collection is off limits to creditors. As the attorney general has told us, and the museum has told Judge Rhodes, the works are held in trust. They cannot be reached by the creditors.
But if that were really true, there wouldn't need to be a grand bargain. The grand bargain, you'll recall, "brings together the equivalent of $816 million from national and local foundations, the DIA and the state of Michigan to spare the museum’s collection from a possible sale." In essence, it's a sale of the museum's collection to a new, independent nonprofit for $816 million. But what makes that the right number? We know that the collection is actually worth a great deal more than that. Doesn't the existence of the grand bargain make it easier for the creditors to come in and say, "Look, everyone -- even the museum itself -- acknowledges that the art isn't really held in any sort of legally cognizable trust, it cannot simply be removed from the bankruptcy process, there has to be a price to the removal ... and this price is too low. There are people out there who will pay twice that amount and the bankruptcy trustees have an obligation to explore those higher offers."
Now, it may be that Kristi Culpepper is right that there is no way Judge Rhodes is ever going to rule that the art must be sold to the highest bidder. But in that case, why bother with the grand bargain at all? Then you're paying $800 million for an asset that's already yours.
