John Baldessari’s home and studio are located in a preternaturally quiet side street of southern California where, as cliché dictates, only gardeners and the soft hum of 4x4s disturb the peace. A couple of blocks west, the freak show that is Venice Beach – muscle-man contests, manky stalls, minor-league menace – is sounding its infernal rhythm. A few miles inland, a more upmarket freak show: LA proper, a place considered unconducive to the creation of great visual art, until that cheeky outsider David Hockney showed us, in his azure-drenched tableaux of all those years ago, that there could be poetry in poolside indolence.

Baldessari greets me at the door of the studio, dressed in black, white-bearded, the look of an Old Testament prophet and the demeanour of a friendly teacher. He is 78 and 6ft 7in tall, yet there is barely a hint of a stoop and he seems in robust good health. The studio is in chaos, preparing for a move into an adjacent new building which has the telltale metal-plated exterior shell of a local hero, Frank Gehry, or perhaps one of his students. “You figured that out?” asks Baldessari with a gentle sarcasm that is very un-LA. “I like to call it Bilbao West,” and he laughs heartily.

Baldessari is another local hero but the art world has taken its time to realise it. His forthcoming retrospective at Tate Modern, Pure Beauty, is not the first to be granted him but surely the most prestigious: it travels to Barcelona and New York’s Metropolitan Museum (“unbelievable”, he says of that improbable stop) as well as coming back to its spiritual home at the Los Angeles County Museum of Art, where he is one of the stars of the museum’s contemporary art collection.

Baldessari’s work, humorous, conceptual, promiscuously mixing text and image, has found its time; or perhaps our own time has finally found him. His wry and clever manipulation of words and pictures seem unexceptional to us today but they strayed a long way from the solemn orthodoxies of the 1950s, when he started his career.

Amid the leaden self-importance of the abstract expressionist generation of painters, Baldessari played the ingenue, seeing what would happen, as he puts it, if he took art at its word: “If it really was all about communication, why not really try to communicate, with things that everyone could understand? Why couldn’t text be art? Or photographs? And if you put words on a canvas, wasn’t it still painting?”

The result was a series of playful and challenging works, typified by his “Tips for Artists Who Want to Sell” of the mid-1960s, nothing more than a written list of bullet points (“Generally speaking, paintings with light colors sell more quickly than paintings with dark colors”) that simultaneously satirised the notions of taste and commodification: very 21st century.

Baldessari says he was lucky to be born and raised outside the LA-New York mainstream, in National City, a lower-middle-class suburb of San Diego. “I was really isolated. I used to bemoan where I was living but it was probably very positive for me. I don’t know if I would have been so venturesome if I had been in LA or New York. I had nobody to please but myself.”

Like most artists, he dislikes the labelling of his work but particularly resists the tag of “Californian”. For one thing, it was not professionally helpful: “In the 1950s, if you were from LA and able to get a show in New York, you were absolutely clobbered. There was a sense of, ‘You shouldn’t be doing this.’ I remember a well-known artist, a good friend, telling me, ‘We have already cut up the pie and there is nothing for you.’ That’s real New York talk!”, and he lets out his generous laugh again. “I have a long memory. I said, we’ll see.”

So was there a provocative element to his work? “I was like a terrorist making a bomb, but not wanting to use it, setting it aside, because there might be an occasion …” He pauses in mid-sentence. “That’s an interesting metaphor,” he says, even as he abandons it.

His lack of involvement with any scene gave him the courage to take risks, he says. “Of course I used to come to LA every month. But most of my culture was imported from books and magazines. I probably knew more about European art than any other LA artist. But I didn’t know that at the time. I didn’t know what I knew.” He savours the wordplay.

During his trawls around the LA galleries in his early days, he found himself continually labelled a “European” artist. “I didn’t know what that meant, and I still don’t.” He says it might have been something to do with his copious reading, the result of his Danish mother’s influence. “It was that whole immigrant thing, all about improving yourself. My father was just a peasant [from northern Italy]. But she read novels. Those were the days of slicing the pages open of a book. I loved to touch books, and still do. I have three libraries and a full-time librarian.”

So he hit the European circuit, where he says he found himself at home. “All of a sudden I didn’t feel so wacko.” He has given up trying to determine the influence of LA on his work. “Your ambience has an effect on your thinking and outlook. What I say is that the shark is the last to criticise salt water. When you’re in it, you don’t see it.”

He became known as a countercultural artist in the 1960s – “I can’t claim to have been alone, a lot of artists were feeling some unease that traditional art was getting exhausted” – but his reputation grew in gradual rather than giddy fashion. He began to teach, “at all levels, from pre-school to postgraduate”, purely to make ends meet. “Honestly, I had to make money. It was never out of some kind of vocation, that should be made clear.”

He says he learned “a lot” about the art of teaching, and about art. “First of all, at the age of about 13 or 14, kids lose their creativity. The girls start drawing pretty women and horses, the boys are all tanks and machine guns. All the clichés. But before that they are fantastic. They don’t think about art as art at all.”

Teaching at preschool level, Baldessari turned to his own default setting, which was to question prevailing opinion, and do the opposite. “I read all these texts about how kids that age have no finger dexterity, so I got them to draw on confetti with the finest pens possible. They loved it.

“Then they are supposed to have short attention spans, so I got these rolls of tape and said they could draw on as much of them as they liked, but they had to complete the drawing. I remember one kid who rolled his out to the end of the hallway, and kept going right to the end. He was writing and writing, and I could see he was flagging. And as he was finishing I could see him write: ‘And …thanks …to …the …pencil.’” He lets out a huge roar of laughter. “That is always on my mind.”

By the 1970s Baldessari himself had left pencils far behind. He had already “cremated” all of his previous paintings and started to use film and video. His love of paradox and subversion remained: in “The Artist Hitting Various Objects with a Golf Club” he struck repeatedly at a variety of items found at the city dump in honour, he said, of “doing just gratuitous things”.

As a burgeoning art market found itself drawn to him, Baldessari could not help making wry comments about it in his work. In “Embed Series: Ice Cubes: U – BUY BAL DES SARI” he airbrushed in the ice cubes a demand to buy his work, a comment on subliminal advertising that also happened to be self-serving. He finally stopped teaching in the mid-1980s, when he won a Guggenheim grant (“after 10 years of applying”) and his work started to sell. “Suddenly there were all these articles [about contemporary art]. Parents started wanting their kids to become artists rather than doctors and lawyers.”

Baldessari’s work took another turn: he began to use film stills that he found in a Hollywood shop, and obliterating the most interesting parts: think of an archetypal film noir scene ambushed by a gang of Matisse cut-outs. “I was interested in found images, and I found these boxes of 10-cent movie stills, featuring unknown actors. I realised there was this whole image bank that people carried around with them, and I could manipulate it just by suggestions and distortion. Of course they were all about kissing and guns.”

Baldessari had found a way of tapping into our collective unconscious by using the cheapest materials to hand. The results were both fashionably nimble and fraught with mystery. There was critical acclaim for the work, and a Whitney retrospective, prompting a typical response from the artist: “It’s a bit scary to have acceptance. You wonder what you’re doing wrong.”

I ask, given this love of confounding expectation, if the goal of his art has been specifically anti-aesthetic. “I think that drive is there. But when you practise art, each time you do something you get better at doing it. So you don’t have to work at making beautiful things. That will come anyway. So why not have other goals?”

But was he wary of appearing seductive or appealing in his work?

“What is it that Kierkegaard said: ‘My job in life is to make things more difficult for people’? I always felt that. But I understand it is a flirting game. It is like a woman trying to play hard-to-get, but not so hard that nobody is even going to try.”

Recent work has focused on collages of what might be called non-traditional body parts: ears and noses, elbows and knees, and now hands and legs – his studio is like a primary school version of a police forensic laboratory. Once more, there is the randomness of the found image at the heart of the work: Baldessari used to collect individual fragments of old billboard posters. “I used to love unwrapping them, wondering what they were going to be part of, and there would be this giant ear or nose, and it just fascinated me.”

I ask him, as he looks back at a life of gently rebellious and always original work, where he found the confidence to strike out in his own, idiosyncratic directions. He answers obliquely. “It wasn’t so much confidence. When I was brought up I had very strong religious beliefs and what I really thought I should be doing was helping people. Art didn’t really help people, and that was a big hurdle to get over.

“But I had an epiphany. I was asked to teach some kids in the San Diego city school system, kids who were basically criminals. They only asked me because of my size. They had attention spans of five minutes. But one kid came up to me and asked if I would open up the arts and crafts room at night. And I said, sure, as long as they would be cool in the classroom. And it worked like a charm.

“The epiphany was, that they had an even greater need for art than I did. It really did provide some kind of nourishment.”

‘John Baldessari: Pure Beauty’, in association with Rolex, at Tate Modern, London, October 13-January 10 2010

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