In recent years, the ubiquity of the market has become an ubiquitous theme. In May, ARTnews magazine, not exactly a bellwether, featured the cover story, "Are You Looking at Prices or Art?" In these pages, Charlie Finch, Donald Kuspit and Jerry Saltz have all taken time out to address the issue, in their own distinctive ways -- and with the recent market turmoil, it’s even more important to understand the effects that money has had on art of late. Saltz, for his part, says that in order to grasp the effect of the market on art we need a new theory of how the art market works, something that "isn’t just a rehash of Marxist ideology."

Fair enough. By this, I take him to mean that we need something besides the warmed-over version of the Frankfurt School’s 1940s-era denunciation of the "culture industry" as crypto-fascist, which migrated through the pages of October magazine into Artforum and became a permanent feature of the art world. It is a mindset that, rather obnoxiously, associates the market with the extermination of subjectivity itself, particularly when it comes up against anything that even distantly smacks of popular culture. Among Horkheimer and Adorno’s targets were Orson Welles and, yes, Mickey Rooney. The horror, the horror. . .

But this attitude has very little to do with an actual Marxist picture of the mechanics of capitalism, a point that should not be as elusive as it seems. Read the Manifesto of the Communist Party. What you will find there, in section one, is a lengthy discussion of the historically progressive function of capital -- it has knit the world together, liquidated superstitions, created undreamed of technical innovations, laid the basis for abundance and so on. It is only starting off from these points that the critique comes: All this is directed by a relatively tiny number of people, who are in general a pretty ruthless and short-sighted bunch.

"And as in material, so also in intellectual production," the MotCP goes on, celebrating the growth of cosmopolitan artistic culture. Thus, the first thing we need to recognize about the art market is that it has given us greater pluralism, wonderful technical and stylistic innovations, and the potential for artists to pursue an independent living. Today, it is the presence of a vibrant market that gives the visual arts a sense of relevance, force and center, saving it from the fractious insularity of, say, contemporary poetry. If the market often appears as an alien, encroaching force, this is not because commerce is inherently diabolical. It is simply due to the fact that we happen to live in a world where economic power is pretty alien to most people.

To get at what the "market" means for art, however, you need first to wrestle with another concept: class. Marxist art critics -- or "Marxian" critics, as they prefer to be called these days (a term that, as it is used, is meant mainly to out-Marx other merely "Marxist" writers) -- rarely mention class, except vaguely, as a synonym for oppression, as in the cliché that an artist is concerned with "issues of race, class, gender and sexuality." This makes it clear that they are "Marxist" in only the most superficial sense, whatever suffix they go by.

But as Sharon Smith points out in Subterranean Fire, her recent book on the radical tradition in American history, "Although income levels obviously bear some relationship to class, neither income level nor degree of class consciousness determines social class. Some workers earn the same as or more than some people who fall into the category of middle class. . . . For Marxists, the working class is defined by its relationship to production. Broadly speaking, workers are those who do not control production but rather are controlled from above, and forced to sell their labor power to employers."

This is opposed, of course, to the "ruling class," or bourgeoisie, defined by owning and administrating the means of production, and acting in the name of profit. But in between these two great antagonists, there is another, the ill-defined though much-mentioned "middle class," a motley crew of small businesspeople, lawyers, professionals and so on. The hallmark of middle-class identity is not a certain tax bracket, in this view, but having an individual stake in production, and a perspective that correspondingly focuses on the values of "independence and authority."

Doctors, for instance, are typically middle class, because they are organized in private practices. Yet, as Smith points out, more and more health-care professionals are working for large conglomerates, pulling them towards a working-class position. If, on the other hand, a doctor’s practice grows to be a conglomerate, and "his" or "her" independent contribution is more and more superseded by a role administering the profits produced by others, then the same person’s position comes to approximate a full-blown bourgeois one.

Now, as we inspect the art world, what class does it represent? It is a sphere dominated by artisans (artists), intellectuals (writers, journalists) and small business owners (gallerists, dealers) -- all organized around their individual, personal contributions; all quintessentially middle class. (The custom of naming galleries after their owners is symbolic of this.)

This simple observation is more illuminating than any Saltzian "new theory of the art market." Because of its intermediate position, the middle class is famously vacillating. On the one side, it is victimized by the whims of big business, and thus thrown back towards the working class and sympathetic to its grievances -- and the vast majority of artists punch the clock at day jobs, even as they dream of realizing themselves through their art. On the other side, the middle class is dependent for its survival on capital -- in art’s case, Clement Greenberg’s "umbilical cord of gold" that connects art to patrons (and the current issue of ARTnews is its sycophantic "Top 200 Collectors" -- in some ways answering the question posed a few issues back.)

What does this perspective explain? It obviously helps untangle the particular paradoxes of art-world political posturing. The art world’s ideology is middle-class liberalism. With an outsider’s perspective on ruling-class machinations, it waffles between aloof esthetic withdrawal, and ironic or outright critical statements about world affairs (it even makes room for a sizable contingent of "Marxians" in its ranks). But its class perspective leads it to focus its politics on individual "gestures" or "statements," situating itself in isolated terms rather than as part of a collective struggle. Understanding the constraints of this position avoids all sorts of deadlocks.

For instance, in the recent Art Since 1900, Rosalind Krauss herself testifies to a crisis of confidence in the high-flown "art theory" that sustained art’s sense of social relevance through the ‘90s: "I don’t know if I can maintain my earlier commitment to this methodological position," she confesses. Her reason? Though "postmodernism. . . constituted a great critique of essentialist thinking," it has become a new mainstream. The esthetic irony of seeing, say, Mike Kelley’s "abject" spectacles become a favorite at tony art auctions -- not to mention the political irony of Hans Haacke’s conceptual piece exposing the slum lord ties of Guggenheim trustees ending up in major museum collections -- seems to have left Krauss without her bearings.

Yet this should provoke no crisis. There is a "methodological" problem here only if one’s methodology assumed that isolated artistic gestures might resolve social contradictions, without any social movement backing them up to give them force.

This does not mean that art or artists cannot play any political role; it is just that some model besides the middle-class one of "my art is my activism" is necessary, one based on concrete solidarity and practical action. Picasso’s Guernica is the most successful political image of the 20th century. Guernica, in fact, embodies the fact that art’s political value is determined in its relation with mass struggle, not in its individual content -- the imagery of the painting, moving as it is, is completely drawn from a vocabulary of forms Picasso had already developed in previous work. Yet, during the Spanish Civil War, after its appearance at the Spanish Republic’s booth at the 1937 World’s Fair, Guernica was literally removed from its stretchers, rolled up and toured internationally to win support for the Republican cause. In England, visitors brought boots to send to the front.

More generally, understanding the class nature of the art world clears up its schizo relation to the market itself -- in general, it deplores the influence of capital as encroaching on its core value of autonomy, yet it is also incapable of conceptualizing an alternative. Surveying the decadence of the 2006 Art Basel Miami Beach provoked the following from Peter Schjeldahl: "I’ve witnessed two previous booms and their respective busts. . . . In each instance, overnight sensations foundered and a generation of aspiring tyros was more or less extirpated. . . . But tough economic times nudge artists into ad-hoc communities and foster what-the-hell experimentation. . . . The nineties were dominated by festivalism: theatrical, often politically attitudinizing installations. . . . I missed the erotic clarity of commerce. . . . and was glad when creative spunk started leeching back into unashamedly pleasurable forms. Then came this art-industrial frenzy, which turns mere art lovers into gawking street urchins. Drat."

Drat, indeed. The passage perfectly distills the narrow mental space of the art scene -- one is either starving and pure, or prosperous and complacent. What’s missing is the ability actively to take on the root of this contradiction in the mindless consolidation of wealth -- and consequently power -- with a very few people. A more equitable distribution of resources in general is the other way, besides throwing "a generation of aspiring tyros" to the wolves, of providing space for experimentation.

Tyler Green comments testily with respect to the recent spate of stories about the market that "the real story is that there’s nothing new here. Art-making has been driven by money since before there was money." First of all, this statement is simply wrong -- to take one example, Martín Ramirez’s labyrinthine modernism, developed in DeWitt State mental hospital and recently the subject of so much praise, testifies eloquently to the fact that there are deep wells of creativity that are not necessarily money-driven. More crucially, however, in his haste to score a point, Green misses the key dynamic driving this meme: The huge growth of the market for art as an autonomous sphere gives the art world a taste of its own potential, the possibility of its independent importance to a broad audience, beyond simply being a generator of luxury goods. But this sense is constantly thwarted by the realities of the actual market, which is governed by a pretty narrow set of interests.

The peculiar, sometimes strained, formations contemporary art takes are often attempts -- consciously or unconsciously -- to resolve these contradictions, which have become more acute as market-values have become more all-pervasive (in step with consolidation of wealth in the economy at large). Thus, you have art that draws on various forms of popular culture, but plays purposefully elitist, opaque intellectual games with them (Cory Arcangel, Banks Violette); art that is staged as political action, but with no meaningful connection to any practical activism (Thomas Hirshhorn, Santiago Sierra); populist spectacles that are simultaneously displays of conspicuous consumption (Jeff Koons, Damien Hirst); and so on. All these reflect the contradictions of economic reality, through the filter of the art world’s intermediate, middle-class position within it.

It is important to restate that, whatever their esthetic merits, in relation to the social contradictions they touch on, these artistic gestures are all compromise formations, dead ends and intellectual cul-de-sacs. While it is the métier of middle-class intellectuals to propose intellectual, individual solutions to problems that are in fact social and collective, it must be acknowledged that these tensions rest on real social antagonisms. They relate to the vast inequality in the distribution of material -- and thus cultural and intellectual -- resources in the world. And the pressures they represent are therefore sure to grow more unmanageable until something changes materially. In this sense, what art needs is not a "new theory" at all, but rather new initiative in relating practically to the actual forces that affect it.

BEN DAVIS is associate editor of Artnet Magazine.