Monday, March 23, 2009

Perspective Anyone?

I don't remember too many details from Fine Arts 13, my undergraduate survey course on the History and Appreciation of Western Classical Art. But I remember vividly the Venus of Willendorf, a squat fertility figure dating back many thousands of years, and I remember a lot of classical statuary, Roman architecture, and the Moorish influence in Spain in the late Middle Ages. But mostly I remember the profound feeling of relief that came over me when, as we started in on the Italian Renaissance in the early 15th Century, artists (Brunelleschi comes to mind) started to use perspective as a principle tool for organizing three-dimensional images on a two-dimensional canvas.

Ahhhh. Perspective. Something we all need. Something we rarely enjoy.

In art, of course, perspective is often something that professional artists love to play with. I have a couple of coffee-table books and many ties in my closet with images taken from the works of M. C. Escher. They provide hours of amusement for my children and me as we trace the passage of someone walking up the underside of a staircase and emerging through a door sideways. It's a little disconcerting but also a useful tool to explore how different points of view result in different outcomes.

Of late I have been reminded how a little more training in the use of perspective might have been useful during the past couple of months on the economic front. I've already raved about the ridiculousness of the US Senate getting all crazy about $50 million of the stimulus bill going to support efforts by the National Endowment for the Arts (NEA). $50 million, for those of you who missed my post, is about 63/10,000ths of 1% of the total $789 billion stimulus package. Kind of puts things in perspective, doesn't it?

But then I remembered something important. The Senate used to get all crazy over the NEA's $172 million budget back in the early 1990s. As a percentage of the Federal Budget, the NEA's budget was even smaller than its current portion of the stimulus package.

Fast forward a bit to this week. Perspective again becomes an important issue.

The general public is understandably outraged that AIG bosses received $160 million in retention (NOT performance) bonuses even as that sad-sack corporation was receiving $170 billion in tax-payer funds to--what's the phrase?--"cover its nut."

Now I don't have exact figures here, but it seems to me that, as justified as this outrage over bonuses is, it pales in comparison to the tens of billions of dollars that AIG is spending on, are you sitting down?, paying large international banking firms for having taken unconscionably bad investment positions in derivative swaps (or whatever they're called).

So, let's run a few numbers and get some new perspective on this AIG mess.

For ease of computation, I'm going to assume that AIG has paid out $50 billion to about a dozen banks all over the world to compensate them, dollar for dollar, the amount that they lost on derivative swappage.

What would have happened if, as frequently happens during a bankruptcy proceeding, AIG had said to these banks, "look, you're about to drive us out of business. But we're about to get some tax money. We'd like to offer you $0.90 on the dollar, since the alternative might just be for us to declare bankruptcy in which case you might get less than $0.10 on the dollar. Would $0.90 be okay?"

Assuming the banks said yes (and how could they refuse? THEY were the ones who made the bad investments to begin with!) tax payers could have saved $5 billion.

So here you have the poor schlubs who are busy "winding AIG down" getting retention bonuses (if they didn't, NO ONE would work for AIG), and getting beat up by the press, the Congress, and the American Public. Their collective bonuses represent just 3.2% of the money that could have been saved if only AIG had offered 90 cents on the dollar. But no one but me seems to be in a dither about it.

See what perspective does to you? It reveals a whole new side to a situation that makes you madder than you were before.

Perspective also reminds you that $160 million is frequently the cause of a lot of gnashing of teeth and flailing of limbs in political circles. We're in the Arts, after all, and we have that perspective down cold.

If this hasn't made you mad enough yet, then consider this.

The $50 million that caused such a furor in the Senate several weeks ago is exactly 1% of the $5 billion that might have been "saved" had AIG done the right thing.

Doesn't this make you want to pick up and head to Montpelier on Wednesday for Arts Achievement Day or to Washington DC next week for Arts Advocacy Day? At least there you'll be among people who share your perspective...

1 comment:

Frank Landry said...

Thanks for the expanded perspective you point out...makes so much sense but, at the same time, frustrates one even further about the non-thinking that goes on in D.C. Keep up your good work!