NOTE: This is the fourth in a series of entries on a roundtable discussion I attended in June…more details in the first post.
When discussing the challenges of for-profit and nonprofit enterprise in the creative industries back in June, there was much talk of ‘elbow room,’ that small amount of extra space (financial space, physical space, time, and other dimensions) that allows for innovation, creativity, risk-taking, and stretching ideas. Whatever it was that ‘elbow room’ represented, leaders on both the for-profit and nonprofit side of the conversation were frustrated that they didn’t have it.
For-profits had lost elbow room due to increased commercial competition, threats of mergers and aquisitions, increasingly tight profit margins, and massive efforts toward efficiencies and vertical integration. Nonprofits had lost elbow room due to competition for both earned and contributed income, to broad expectations and efforts to serve not just a creative but a social agenda, and to increasingly restricted funds (see Fun with Fungibility).
The odd thing is that the nonprofit corporate tax structure was originally designed (in part, at least) to provide this elbow room. The exemption of nonprofits from many operating taxes, their access to volunteer and discounted labor, and their ability to provide tax-exemptions to major benefactors, were all an effort to buffer them from the commercial market, and to create a space for forms of expression and heritage that couldn’t stand otherwise (at least not in the same number, and not outside of major metropolitan areas).
As the nonprofit creative industries have matured, grown in number and in sophistication, a different bundle of market pressures have overtaken that original conceptual space.
As I’ve quoted before, Samuel Beckett once said that all art is ‘an attempt to fill an empty space.’ With less and less empty space in our corporate structures, our financial structures, our physical structures, and our social structures, true art and innovation is potentially crowded out.