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For much of the past year, an emotional debate has roiled in the United States about the fate of the majestic Detroit Institute of Arts, a sprawling museum that houses about 66,000 gorgeous works. In this city-owned gallery are treasures from old masters and impressionists, and an important collection of American art (including giant Diego Rivera murals). There are pieces by van Eyck, Bellini, Rembrandt and Degas. Bruegel, Velazquez and Picasso. There is the beloved 1781 Goth fantasy The Nightmare by Henry Fuseli – the one you have seen in undergrads' rooms, of a monkey sitting on a fainting maiden.

The city, however, is bankrupt. Detroit is $18-billion (all figures in U.S.) in debt, and it has underfunded its pension plan for retired employees by $3.5-billion. The state-appointed emergency manager of city finances, Kevyn Orr, has understandably been talking about selling city assets, including some or all of the art at the museum. The auction house Christie's was engaged to appraise all these works, and initially estimated that the nearly 3,000 works controlled by the city were worth between $452-million and $886-million. Christie's delivered a more detailed report to the city this week, and raised its appraisal estimates to between $454-million and $867-million.

Whatever the art is worth, it's nowhere near enough to ease the pension shortfall, let alone pay down the city's debts. Still, Orr has been quoted as saying, "Cash is king. Until I have cash in hand, or a firm proposal or a definitive agreement, everything is on the table."

Even at the high end of the range, the value of the collection doesn't change the philosophical issues at stake. Art lovers are outraged that such important cultural assets – which took almost a century to collect and curate – could be removed from a city that has lost everything else. Local philanthropists are trying to raise $500-million to save the collection. Furious editorials have appeared in newspapers from financially solvent cities – including The New York Times and The Guardian – denouncing such ruthless pragmatism as philistinic. "Merely considering a priceless collection as an 'asset' – and encouraging the public to do so – is pernicious and predatory," fulminated Roberta Smith in the Times. She argued that the city doesn't even have the moral right to sell the museum's prize works, as the city should be considered the steward, not the owner of the art.

"And just as Detroit is not a corporation," warned Jason Farago in The Guardian, "the Detroit Institute of Arts is not a family or a small business fallen on hard times – it's a public trust. Now is the time to remake Detroit, not to strip-mine it." Farago argues convincingly that the sale of art would not affect the city's bottom line anyway, and not just because the projected profits are relatively paltry in comparison to the shortfall, but because one-time infusions of cash in major bankruptcies never solve underlying problems of revenue and expenses. Also, he and others warn that the city might not have the right to sell works that were donated to the institute, and legal battles over that right could tie up the process indefinitely.

Others have pointed out that it is awfully easy for someone sitting in deeply affluent New York to talk about Philistinism and the eternal value of art. But a laid-off government employee with no pension security has a right to feel differently.

One proponent of the sale is the proudly pro-corporate writer Virginia Postrel, who wrote on a Bloomberg website: "Great artworks shouldn't be held hostage by a relatively unpopular museum in a declining region." She would like to see the art bought by younger museums in faster-growing areas of the U.S. She likes to stress that art has always been a commodity. She points out that the DIA itself acquired a lot of its collection from European immigrants after the war who were desperate for cash. Art moves around like this. It goes to where the money is.

Writing in the Daily Beast, Nick Gillespie concurred. Detroit, he seems to think, just doesn't deserve art anymore. "Building a future around a slogan like Detroit: Come for the Bankruptcy but Stay for the Bruegel is no way to resurrect a city whose population peaked back in 1950."

This is a harsh exclusion for the Detroit schoolchildren who have nowhere else to see beautiful paintings from the past. And it's an annoyingly materialist view of something essential to human growth.

This debate is happening against the backdrop of another money crisis in visual art: the absurdly inflated prices that works of art command at auction. It comes on the heels of wailing about art as commodity for the ultra rich, after the recent sale of the Francis Bacon triptych for $142-million. There is a commonly held sense that art is spiralling out of the purview of ordinary people, that the rich are stealing it away and hiding it in their vaults. So fears about the disappearance of great public collections are heightened.

One point that hasn't been made in all this is that the cultural value of old masters' works changes with time as well. I'm among those who would rather see a single incisive show of contemporary art than a roomful of powder-pink Renoirs. (It's funny, actually, how so much of the media discussion about the glory of the DIA collection focuses on the Impressionists – the most revered works of "great art," but to me the least interesting works in the collection.) It is socially taboo to suggest this in the current climate, but is it possible that Detroit's renascence might be better served by the coterie of living artists currently beginning to thrive there – and by the contemporary galleries they will bring – than by a vast, expensive and underused monument to established tastes?

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