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Last night in Miami, I found myself at a party. Rich and glamorous and beautiful people sipped top-shelf liquor by the swimming pool, expertly ignoring the black-tied waiters passing meticulously-assembled canapés. In that respect, the party was not unlike many, many other parties in Miami this week. But there was one thing that made this party different: it didn't even pretend to be about art. It wasn't put on by a gallerist, or a private bank, or a luxury brand seeking to hijack some of the glamor of Art Basel Miami Beach. Instead, the party took place in Coconut Grove, far from the South Beach and Design District craziness, and it was connected not to any art fair but rather to the World Economic Forum.

Was this an Art Basel party, all the same? Yes, it was. Art Basel Miami is an orgy of luxurious excess, and it always has been — that's its raison d'être. The main fair itself, of course, is wildly profitable: galleries from around the world pay tens or even hundreds of thousands of dollars for the privilege of being able to stake out a few square meters of exhibition-hall space and hawk their wares to a crowd of ultra-wealthy art collectors, all of whom are pumped and primed to buy buy buy, lest someone else buy the piece in question first.  But the main fair is merely the eye of a much, much larger storm. And it's the storm, not the eye, that people talk about when they talk about Art Basel.

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The storm that is Art Basel takes place all across Miami, wherever excessive sums of money are to be found. And to understand what propels it forwards, it's important to understand that the art, and the parties, aren't the point. Artists, when they come to Miami for Art Basel, are invariably confused and/or angry. Sometimes, indeed, they get so angry that they'll head-butt 700 water balloons while explaining that they're “making a statement” because in their art space, “nothing’s for sale.”

Doing this kind of thing makes artists feel better, because they find the shiny billionaire-friendly art with six and seven-figure price tags at the convention center to be boring. Art Basel looks just the same as the Armory Show; this year's fair looks just the same as last year's fair; what's fresh? What's new? What hasn't even been made yet? (The most-read article at this year's fair was DT Max's profile of Hans Ulrich Obrist, the curator who is "obsessed with the not-yet-done" and who is criticized as being "fast-moving and superficial".)

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These art-world kvetchers, however, are making a category error. They think that Art Basel is about art, when in fact it's about money, and — even more — about the people who have lots of it. At an art fair, paintings and sculptures stop being art — a fair is pretty much the worst possible environment in which to appreciate art — and instead become objects with a dollar value and an asking price and a future value trajectory. If you're smart, you buy now, before the piece in question soars in value. If you're stupid, you buy at the top, and find yourself saddled with an expensive work that no one wants. That's the game, and in order for that game to be played the pieces have to have a certain sameness to them, from one fair to the next and one year to the next. When the name of the game is brand recognition and speculation, the excitement comes from seeing artists rise and fall in value. This Anish Kapoor might look exactly the same as all the other Anish Kapoors you've seen at various art shows over the past few years, but when you know how much the asking price was, for each piece, at each show; when you can kick yourself for not buying when he was cheaper, or congratulate yourself on not buying when he was more expensive — then you can start to understand what makes an art fair so exciting to the monied classes.

That's why an art fair is the perfect thing to have at the center of the Art Basel storm. It's an orgy of capitalist excess, a place where objects with no intrinsic value sell for millions of dollars. Most crucially, it's a place where sums which would be enormous in other contexts become commonplace, or even risibly small. When Art Basel started, its main backers were the real-estate developers throwing up identical white-steel-and-glass condominium towers in South Beach. The condo game, back then, was similar to the art game: buy now, for a million bucks or so; flip tomorrow for a healthy profit. And the best way to sell a condo in Miami Beach is to sell to a group of people who are surrounded by sun and sex and sand and who are simultaneously inured to eye-popping price tags.

Miami real estate is much like high-end art in another important respect, too: it appeals to an international crowd of people who don't necessarily like having their assets tracked and taxed by their domestic governments. You don't hear the term "money laundering" very much inside the art fair, but there are obvious attractions to any asset which is both extremely valuable and highly portable. Then look at the sheer number of nationalities buying high-end Miami condos, invariably through shell companies, and remember that Florida has no state income tax. Let's just say there's a natural overlap there. And while the wattage of Miami does dim a little bit during the 51 weeks of the year that Art Basel is not going on, it's also worth remembering that if you're the kind of person who has eight different residences around the world, you might well only spend a week or two per year in Miami anyway.

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Which brings me back to that party in Coconut Grove. The attendees were not Davos delegates: they weren't billionaire industrialists, or heads of state, or economic policymakers. Instead, they were all in town for something called the World Economic Forum Family Business Community Next Generation Annual Meeting. Essentially, the WEF has realized that a rapidly increasing degree of economic power is being held in the hands of ultra-rich families, and so it has started catering directly to those families. Not just the men at the top who made the money in the first place, but to their children, too, and even, in some cases, their grandchildren. They're the stateless rich, and it's no coincidence that their annual meeting, this year, took place at the same time — and even in the same convention center! — as Art Basel.

Because the storm that is Art Basel Miami Beach is, at heart, about creating a reason for the free-spending private-jet crowd to descend upon Miami for a week. The art attracts them, and so do the parties, and so do the celebrities, and so does the December sun. But mostly, Art Basel Miami Beach, and the orgiastic clusterfuck of conspicuous oneupmanship at which it excels, acts as a bat-signal for the obscenely wealthy. In a stateless world where everybody is always on the move, Art Basel is one of the few rocks in the stream — it's the one week per year that you can put in your calendar, safe in the knowledge that all your gazillionaire peers are going to be there as well. That alone makes it almost worthwhile to buy a condo.