Last year Grayson Perry won the Turner prize for his scratchy, ugly vandalisms of perfectly good vases. Perry uses a medium he has obvious contempt for, and is rewarded as if his crass reduction of thousands of years of beauty and imagination to a cliche of middle-class domesticity were somehow profound. If his Turner prize and the popular acclaim for his works in the Turner show is anything to go by, clay is a medium stultified for most of us by its association with pretty vases and teapots. We want ugly vases! Political teapots!
The exhibition A Secret History of Clay: From Gauguin to Gormley, at Tate Liverpool, is timely. If we find Perry's eyesores clever, we must be very ignorant about the history of one of humanity's characteristic ways of shaping the world. Take Bernard Palissy's glazed ceramics, which glisten in a case at the Victoria and Albert Museum, sinister in their overripe beauty. This 16th-century French potter and scientist is the Caravaggio of clay, a student of nature at its most heady and macabre. His dishes are laden with three-dimensional flora and fauna, shaped and painted uncannily to resemble real life. At the bottom of a bowl, a snake wraps around itself. On a plate, lizards lurk. I find it very difficult to think of these bizarre things - fired more than 400 years ago - as staid, boring, dusty old antiques.
Yet the story this exhibition tells is more than a disappointment. It is a mystery. Why has most modern art in this particular medium been so dismal?
Abstract expressionist vases, futurist jugs and the porcelain urinal that Marcel Duchamp said was a work of art - Tate Liverpool has it all. But few of these things are more than curios and eccentricities, cliches, false starts, blind alleys. Something was wrong with the way modern artists looked at clay all along, from the 1900s to today.
The first modernist painters had a hard target in sight: 19th-century painting that aggressively insisted on pictures, figures, narrative and sentiment. It was crying out to be pulverised by cubists, futurists and suprematists. But clay, by contrast, is a soft, yielding substance that easily shifts its shape. People have always made quirky, magical, unexpected things with it. There never was an authoritarian ceramics establishment to attack. Not even in the 19th century.
Victorian houses were full of bone-china bottles covered with swirling blue-and-red flowers taken from Turkish designs, glittering lustre vessels with gold abstract foliage, and Pugin and William Morris tiles decorated with monsters and hinting at Arthurian dreamworlds. A tea set designed by Henry Cole in 1846 has a pure, white simplicity that any modern sculptor can admire; but then of course, this is a pale reflection of the minimalism that flourished in China millennia ago.
If minimal beauty is not to your taste, then how about some florid, kitsch visual mayhem? There is no history of ceramics, in the sense that there is a history of western painting and sculpture - no obvious movement forwards. It can be impossible to guess if a piece of porcelain is 20th century or hundreds of years older. Not only is there no progressive history of clay, there is no stable aesthetic either. Excessive, outrageous colour and monstrous prodigies of form can be as gorgeous as restrained decorum - and are as frequent in the historical record.
Bernard Palissy is in no sense tasteful or polite: his wittily grotesque creations obey no rule. He was not only a craftsman but a scientific researcher, obsessed with discovering a new white enamel. His book Discourses Admirables (1580) is a key document of the scientific revolution, attacking the antiquated hierarchy of knowledge upheld by the Sorbonne. A Protestant, he died in the Bastille.
I stress Palissy simply because he is so impossible to place in some dreary hidebound past. Historically, pottery has been associated with scientific discovery and industrial innovation. It was always on the side of mass-production, curiosity, the new - from the European adoption of porcelain to Josiah Wedgwood's factory. At the Museo delle Porcellane in the Boboli Gardens in Florence is a dish made in Dresden in the 18th century. It bears an image of the iron bridge at Coalbrookdale. Ceramics are on the side of modernity.
Modern art fell flat on its face when it tried to "subvert" something so wild and innovative. Modernist pots are interesting - sometimes. There seem to be two recurring tropes in modernist work in clay: decoration and collapse. The decorative tendency consists in adding an expressionist - or abstract, or whatever style you want - design to an object whose form is essentially unaltered: say, a vase with spirals instead of flowers. Then there is the aesthetic of collapse, especially prevalent since the second world war. The thesis here is that a modern pot is a melted pot, a broken pot. So you get jagged, ragged, lumpen exercises in anti-form, and frankly they are just that - exercises. Is this really a serious contribution to the history of making things? No, because there is no dreary conservative formalism to be against. There is nothing oppressive about a vase.
There are, in the Tate Liverpool show, exceptions to what is mostly a failed marriage of modernism and craft. One is a bit embarrassing, from Mussolini's Italy where, as in Lenin's Russia, art and craft became one. Abstract futurist designs entered everyday life in ways that are still visible in Italy today. The great thing about Lucio Fontana and Tullio d'Albisola is that they were creating new forms and new possibilities for ceramics rather than simply grafting a modern style on an old pot. In Russia, the extraordinary suprematist designs of Kasimir Malevich enforced the aesthetic of revolution on St Petersburg's porcelain factories, to productive effect.
Aside from these totalitarian glories, there are only two truly great artist-potters of the modern era. Gauguin shaped clay as mystically as he carved wood; the Tahitian primitivism of his earthenware is personal, revealed, unique. But even his work looks conventional compared to what Picasso did with a kiln.
Picasso, in craft as in art, vindicates modernism and suggests how little its promise has been fulfilled since his death in 1973. He does, absolutely, act as if pottery as we know it was stifled by bourgeois convention, and sets out to reinvent it - from scratch. Picasso does everything you want a modernist potter to do. He releases new forms, new shapes, new colours and graphics into the world. You could even get overexcited and say this was his true art - if you didn't know he was a genius in everything else as well. The examples of his work in this show lift your heart and clean your mind; they are at once ancient and unprecedented.
Picasso was not a very domesticated person. He lived in chateaux, surrounded by luxury, but because he never stopped working, there was never a bourgeois moment. This shows in his ceramics. There is a similarity in their praise of work to the Victorian socialist crafts of Morris and co - and in fact Picasso became a potter in the years after the second world war when he was a member of the French Communist Party. But far from asserting worthy craft values, his creations in clay have an unquenchable movement and bounce; it's as if he were still moulding wet earth before your eyes, so mobile are these pieces. Monsters, fauns, bulls all leap into life, dance out of the fluid substance. Handles are horns, bases are feet. Picasso is loyal to the traditional utility of ceramics, making everyday objects, and yet revealing in them the potential for life to be so much more mytho logical, erotic and hungry than industrial society would have it.
They are his Mediterranean swan song, these artefacts, recalling as they do everything from Athenian red figure vases to Andalusian Islamic lustrewares. Picasso does not fall into the trap of contempt for an ancient medium; rather, he revives the power of ancient clay just as his paintings praise African art. At the same time, the freedom and spontaneity of the way he flung these things together - perhaps most flaunted in the designs he painted quickly and joyously on hundreds of plates - may be his way of competing with the American "action" painters, Jackson Pollock and Willem de Kooning, showing that Picasso could improvise better than anyone.
Picasso makes this exhibition worthwhile, but his genius has no children. The best use of ceramics in contemporary art is in the work of Jeff Koons. Everything Koons does, or commissions some Austrian artisan to do, is ridiculous. The history of pottery, however, includes many things that are ridiculous. In this art there is a licence for the absurd, the silly, the rococo. Koons's Puppy Vase (1998) both satirises and indulges our appetite for domestic fancies with warmth and pathos. If only there were more works that had his respect for the culture of the everyday.
· A Secret History of Clay: From Gauguin to Gormley is at Tate Liverpool until August 30. Details: 0151-702 7400.
