Big-time collectors expect the best, and they usually get it. Each season, Impressionist fans are offered top works by Renoir and Monet, modern European buffs have their pick of important Picassos, Mirós and Légers, and contemporary collectors savor juicy Warhols and de Koonings. But money can’t buy everything. In the market for 19th- and early 20th-century American art, the “best” is now unavailable at any price. Great paintings by such major names as George Bellows, Thomas Eakins, Winslow Homer, William Sidney Mount and James Abbott McNeill Whistler are so rare to the market that not a single example may surface for years. Scarcity—an annoyance in other fields—has become the ruling principle of this one, causing prices to skyrocket, public institutions to sacrifice important holdings, collectors to move to greener pastures and observers to ponder the future of a category where masterpieces are perpetually out of reach.

Any collector in search of one of William Sidney Mount’s mid-19th-century genre paintings will be looking a long time; only one of these memorable all-American renderings has come to market in the past 25 years: Mount’s Power of Music, 1847, portraying a black man clandestinely enjoying the music of a white country fiddler, was sold by the Century Association, in New York, in 1991 to the Cleveland Museum of Art for a reported $7 million. More paintings by Winslow Homer have changed hands during the same period, but only one—the 1885 Lost on the Grand Banks, a dramatic depiction of the power of the sea, bought by Microsoft chairman Bill Gates in 1998 for a reported $30 million—is considered truly important. Sightings of significant works by other coveted artists have been, and are likely to continue to be infrequent. “There are no major works by Thomas Eakins left in private hands,” says Dara Mitchell, the head of the American painting department at Sotheby’s New York. “There are a few Hoppers out there and maybe a handful of  Bellows works.” The New York dealer Howard Godel adds: “Go to every dealer in the country, and you won’t find one great Sanford Robinson Gifford or Albert Bierstadt. And the right William Merritt Chase? Good luck.”

The true extent of the problem has yet to register with some hopeful collectors. “People call me three times a year and say, ‘Get me a Hopper,’ ” says the Leicester, Vermont, private dealer James Maroney. “They think that if I just put my mind to it, I could get them a painting like Nighthawks,” the famous 1942 scene of a diner, in the collection of the Art Institute of Chicago. Others are more resigned. “A Hopper …” muses the Ohio-based collector Jim Dicke, the chairman of the board of the Smithsonian American Art Museum, in Washington, D.C., as if contemplating something lovely but long extinct. “I haven’t been offered one of those in 20 years.”  

Twenty-five years ago, the American market was a very different place. “When I was working for dealers in the 1980s, we had plenty of stock,” recalls Eric Widing, the head of American paintings at Christie’s New York. “Buyers, we had to go out and find.” The New York art consultant Barbara Guggenheim has also seen a seismic market shift. “Back in the ’80s, we would take out a client every week and see so much that we would go home and have to decide, this one or that one?” she says. “These days you can go for six months without seeing an American picture of real quality.”

What happened? Start with the fact that a limited number of great American paintings were created in the first place. “There were always fewer artists in America than in Europe,” observes Eleanor Harvey, the chief curator of the Smithsonian American Art Museum, in Washington, D.C. “And they were catering to a much smaller market. So they made a fraction of what their European counterparts produced.” Factor in the thousands of works that were grabbed by American museums during the 20th century, and it’s easy to see why there’s a shortage.

Until about 1990, aficionados could still count on a steady stream of pictures coming out of attics and off the walls of early collectors who, seeing prices rise so steeply, were happy to sell Grammy’s landscapes at a tidy profit. But during the past two decades, the attics have been cleared out, and market circulation has come to a screeching halt. “Today major works are no longer in the hands of doctors and lawyers and other ‘little people’ who, at some point, will want to trade up or cash out,” says Godel. “There has been a movement to ‘strong hands’: billionaires who will never need to sell their collections.”

Some of these have already given their holdings to institutions. Notably, the shoe magnate Peter Lunder entrusted his collection of more than 400 works—among them, canvases by Chase, Homer, George Innes and Georgia O’Keeffe—to the Colby College Art Museum, in Waterville, Maine, last May; and the Virginia energy baron James McGlothlin has promised $70 million worth of art, including examples by Homer and Whistler, to Richmond’s Virginia Museum of Fine Arts in 2005. Other megacollectors have founded museums of their own. Five years ago, the Alabama paper czar Jack Warner opened the Westervelt Warner Museum of American Art, in Tuscaloosa, and the Wal-Mart heiress Alice Walton is busy buying works to fill her soon-to-be-completed Crystal Bridges museum, in Bentonville, Arkansas.

Ultrawealthy collectors like Bill Gates and the Denver media mogul Philip Anschutz aren’t selling either. Not only are they immune to the prospect of potential profits, but many of them acquire American art as an expression of national identity. “These people are very patriotic,” says Godel, “and to them these works encapsulate the history of America.” So unlike some collectors of contemporary artworks, Godel says, “they are never going to sell them.”

Meanwhile, more connoisseurs are lining up to buy. “The number of people who want to collect American art has increased tremendously in the past few years,” says Sotheby’s Mitchell. Betty Krulik, a New York private dealer, has noticed this as well. “These days when I get something great,” she says, “there will be at least 20 collectors dying to buy it.”

Maybe it’s the 9/11 effect—collectors deciding to buy “made in the U.S.A.” in the wake of the World Trade Center attack—or the result of more scholarship in the field, or of more museum exhibitions, or maybe it simply reflects the increasing concentration of American wealth, but experts have never seen the American-art field so crowded. Neither have frustrated fans. Cheryl Chase, a Connecticut-based 10-year veteran of this market, complains that “there is now so much competition for the best things that it’s becoming impossible to buy anything.” The Smithsonian’s Harvey adds: “We have always cried ‘scarcity,’ but the problem is bigger now. There are simply too many fisherman in this pond and not enough fish.”

Any major catches now command whopping sums. “Scarcity has driven prices to levels we never could have imagined,” says Christie’s Widing. Take Hotel Window, 1955, one of the few trademark noirish Hopper paintings to come to market in the past few decades. Purchased by Steve Martin at Sotheby’s in 1987 for $1.3 million, the work netted the actor an eye-popping $26.8 million when he sold it at the same venue in 2006. When Polo Crowd, 1908, a rare, desirable work by George Bellows owned by the John Hay Whitneys for almost 70 years, hit the block in 1999, Bill Gates had to pay $27.5 million to take it home. Even less illustrious works bring big bucks. When Breaking Home Ties, 1954, a Norman Rockwell illustration for the cover of the Saturday Evening Post sold to director Steven Spielberg for $15.4 million at Sotheby’s in 2006, old-timers were horrified. “The auctions are now filled with Rockwells,” laments dealer Maroney (Sotheby’s last American-art sale, in November 2007, included 13 works by the illustrator). “If people who knew the market in the 1960s came to a sale today, they would say that they are loaded with scraps—priced at over $1 million apiece.”

Maybe so, but collectors are scrambling for them anyway. “Scarcity is feeding the market frenzy,” says the Los Angeles–based art adviser Michael Quick. “Auction houses and dealers are always warning collectors that something is their last chance and that they will never be offered anything of comparable quality again.” It’s not just a marketing ploy. “People are constantly asking me, ‘How many more Homers, or Sargents, or whatever are still out there?’ ” says Krulik, “and then counting them down as they disappear. Anything great is now seen as a once-in-a-lifetime opportunity.”

Not everybody waits for the “for sale” sign to go up. “People knock on doors and offer collectors the moon for their paintings,” says Guggenheim. “Not a day goes by without a call to one of our clients offering to buy one of his great American landscapes. But he is not selling, because he knows he cannot replace them.” It’s enough to force even dedicated American-art aficionados to look at different fields. “I have started collecting some contemporary art as well,” says James Dicke. “At least in that market, there is the chance to find things.” And Cheryl Chase is considering Old Masters and 19th-century European works.

Dealers, too, have been casting around for ways out of the scarcity bind. “Some of us have tried to open a modern wing of our business,” says Maroney. Indeed, New York galleries such as Spanierman, Hirschl & Adler and Hollis Taggart, generally associated with older American works, all show some contemporary art. “But it doesn’t always work,” continues Maroney. “We are downright clumsy about it, because contemporary art is not what we know best.”

Fortunately—or unfortunately, depending on your point of view—extreme scarcity and the consequent surge in prices have created a new source of supply. Non-art institutions like libraries, universities and clubs have been selling their American pictures in record numbers. “Many of these places are now holding their art very tenuously,” says Maroney. “They say to themselves, ‘We have $100 million worth of art, and we cannot take care of our students, or our patients, or whatever.’ ” Many pictures are leaving the walls where they have hung since before the turn of the 20th century, from Asher B. Durand’s Kindred Spirits, 1849, sold by the cash-strapped New York Public Library to Alice Walton for a reported $35 million, to Thomas Eakins’s Gross Clinic, 1875, bought from Jefferson Medical School in 2006 for $68 million, raised by the Philadelphia Museum of Art and the Pennsylvania Academy of the Fine Arts after the heiress threatened to take that famous painting to Arkansas, too.

Canny collectors are making offers institutions can’t refuse and waiting patiently through the outraged backlash such sales invariably create. A Nashville judge recently rejected Alice Walton’s 2007 bid for a half interest in Fisk University’s Alfred Stieglitz Collection, which contains modernist gems by O’Keeffe and Marsden Hartley. Walton reportedly also approached Randolph College, in Lynchburg, Virginia, which is on the verge of losing its accreditation because of lack of funds but is blessed with a collection of American art worth more than $100 million. The college chose instead to consign top examples to Christie’s in December 2007. Those lots, including Bellows’s Men of the Docks, 1912 est. $25–35 million), and Edward Hicks’s Peaceable Kingdom, circa 1840–45 (est. $4–6 million), were withdrawn from the sale at the last minute because of legal challenges, and at this writing the collection’s future is still up in the air. Despite such dramas, observers expect institutional collections to be the deus ex machina of the American market for some time to come. “The art on their walls is now more valuable than their buildings,” says the New York dealer Warren Adelson, “so a lot of selling is bound to happen.”

But there will never be enough goodies to go around. For most buyers “the market is evolving toward what is available,” observes Adelson. Jim Dicke agrees. “A few decades ago we would have walked right by artists like the Japanese-influenced Arts & Crafts–era painter Arthur Wesley Dow and snowscape specialist Walter Launt Palmer. But now people are taking another look,” Dicke says. “There is also new interest in regional artists.”

What is still out there? “Important works by Andrew Wyeth are still available,” notes Barbara Guggenheim. So are those by unusually prolific painters like John Singer Sargent. Also still in reasonable supply are late 19th- and 20th-century illustrations by Norman Rockwell, Maxfield Parrish, J. C. Leyendecker and others; Neoclassical sculpture by the likes of Hiram Powers and William Wetmore Story; and Surrealist works by Jared French and George Tooker; as well as works on paper by such major names as Charles Demuth and Albert Bierstadt—his butterfly drawings, for instance—and by 20th-century urbanists Reginald Marsh, Everett Shinn and John Marin. Very nice, but slim pickings for those determined to fill their lives with first-class works by the great names that drew them to the American field in the first place.

Can anyone still amass a great collection of American art? With unlimited cash, maybe, say veterans of the category, but not for long. “I have a daughter interested in going into the market, and I’m not sure what to tell her,” says Christie’s Widing. “By the time she is ready to enter the field, there may be so little around that it won’t be as active a place as it is today.” In fact, the age of a booming market for our national art may soon be as quaintly historical as the era when dealer Joseph Duveen raided Europe’s Old Masters for American tycoons in the 1920s. “Today, when someone asks, ‘How is the market for Titian paintings?’ you just laugh at them,” says Adelson, speaking to the rarity and staggering cost of such works. “Decades from now, someone will be asking, ‘How’s the market for Sargent?’ and I’ll be laughing.”

"Slim Pickings" originally appeared in the May 2008 issue of Art+Auction. For a complete list of articles from this issue available on ARTINFO, see Art+Auction's May 2008 Table of Contents.