Supply and Demand Redux: Rocco’s Comment and the Elephant in the Room

I’ve been following the responses to Rocco’s ‘decreasing supply‘ comment and his subsequent post on the NEA blog. Some believe that supply/demand is the wrong framework through which to look at the sector; some that there is no such thing as too much art and that we should increase patronage rather than ‘kill’ organizations; some agree with him but believe it was inappropriate for him to make the statement; and a few seem to agree with his points and believe that it was beneficial for him to make them. I’m in the last group.

Rocco has done the arts sector a service with his ‘decreasing supply’ comment as I think it has created an opening for a candid discussion about an elephant in the room: the US lacks a mechanism for identifying and dealing with mission-failing arts organizations and (because competition for resources exists) the nonprofit arts sector might be healthier overall if some mission-failing organizations were to close. Following on my overstocked arts pond post of a few weeks ago, here are some further thoughts on the supply/demand issue.

Competition among arts organizations for earned and contributed income exists. Some markets and organizations experience more competition than others, but it is not uncommon for arts groups located in the same city to be competing to secure patronage and trustees from among the same (narrow) demographic of upper middle class well educated arts-goers and funds from one or two government agencies and a small number of private foundations and corporations.

Many arts people take the stance that we should ‘let 1,000 flowers bloom’. While one might theoretically argue that there is no such thing as ‘too much art in the world’, the same cannot be said of arts organizations: to the degree that resources are not growing at the same rate as organizations (and they are not according to the most recent National Arts Index report), every new firm that enters the sector reduces the chances of every other to secure sufficient resources to operate.

If a commercial firm experiences losses year after year—unless it can successfully develop a new market for its product, or change its product to better serve existing markets, or restructure its business to reduce expenses, or find economies of scale through expansion or merger, or achieve revenues over expenses via other strategies—it will most likely shut down.  Or it might be taken over by others who believe they can do a better job of running it. If an entire industry is in decline and there is insufficient demand for the current suppliers to cover their costs then one would expect to see firms exit the industry until equilibrium is achieved.  There are exceptions– but generally speaking, this is what one would expect because commercial firms exist to make profits.

It’s more complicated for nonprofits because while they must have sufficient cash to operate, they exist (as Andrew Taylor has succinctly put it) to ‘maximize mission’ not profits.  Nonprofit organizations do not (in theory) exist to benefit themselves (i.e., to keep arts administrators gainfully employed); they have an educational and charitable mission and exist to benefit society (e.g., to support the development of artists and people’s relationship to the arts). One cannot assume that an organization that is balancing its budget is achieving its mission and providing cultural and social value to society; nor can one assume the opposite. 

If there are nonprofit arts organizations that are not providing ‘sufficient’ value to society relative to the current investments in them by the government, private foundations, and other donors, and if they do not appear to be able or willing to adapt to fix this situation, then it is logical to assert that other more deserving nonprofit organizations (arts or otherwise) that are currently competing with them for resources would be better off if those ‘mission-failing’ organizations would close (or be re-organized).

However, even if we were able to identify ‘mission-failing’ organizations (sometimes it’s obvious, often it’s not), we do not have a clear method for dealing with the ‘dead weight’ in the sector.  We don’t have a ministry of culture and large government subsidies. If we did, failing organizations could be de-funded and might adapt or close their doors as a result. The plurality of the US nonprofit model is both a strength and a weakness. Government agencies, private foundations, corporations, and major donors give more than just their money: they give endorsements that serve as signals to board members, leaders of organizations, and other donors. Renewed support from the state arts council or one well known family foundation to a failing organization can be all that’s needed to encourage other donors to re-up and for the board and staff to persist on the wrong course for another year (despite good sense telling all of them to do otherwise).

Many organizations were started with the belief that they should exist as permanent institutions and have fought for their survival at all costs. Some of our dead weight is in historically leading ‘tall trees’ that have been preserved for far too long. Those that are the largest or that have already existed the longest are often assumed to be the most valuable. This is why many arts organizations get nervous when the cutting supply conversation happens; they assume (and with good reason) that funders and government agencies will sooner turn off the sprinklers that are misting the grass, the small bushes, and the saplings than shift the hose from one tall tree. (I’d like to see some funders prove them wrong on this.)

We lack a sound mechanism for communities to identify and deal with mission-failing organizations—those that refuse to adapt or close despite a preponderance of evidence that it would be better for society if they were to do so. There is no easy solution to this but there are opportunity costs to ignoring the problem:  again, resources going to failing organizations are resources that cannot be utilized by those providing greater cultural and social value.

The reality is that organizations will close. Some already have, some are closing as I write this, and some will die in the coming months or years. And they will either be the right organizations to close or the wrong organizations to close.  Why is it better to shut our eyes, wring our hands, and hope for the best?

Of course, dealing with  failing organizations is only part of the strategy. We still have the issue of declining participation rates. Many took offense at Rocco’s comment that ‘demand is not going to increase'; but according to a report put out by his own agency, arts participation rates have been trending downward, more or less, for more than two decades.  I don’t perceive Rocco to be a pessimist as much as a realist.

Optimistically, I believe that there is ‘pent up demand’ (read: need) for the arts that is not being realized because of financial, geographic, cultural, educational, social, logistical, programmatic, and other barriers to participation. Pessimistically, I do not see many nonprofit arts organizations radically adapting their institutions to address these barriers. I hope I am proven wrong on this.

To be clear, I’m not suggesting that every organization needs to serve its entire community (it would be unwise for all but the largest flagship institutions to even try to do so); but if a given community has 100 arts organizations, neither should 80 of them be serving the same small segment of society. Perhpas arts organizations should spend less time stewing about the ‘decreasing supply’ comment made by Rocco Landesman and more time pondering why  participation rates have been declining and why the arts and culture sector is securing a declining portion of philanthropic dollars? This may be the other elephant in the room that merits some earnest discussion. And (please) this is not a call for greater investments in marketing and fundraising; it is a call for more relevant institutions.

Elephant image by Alexander A. Sobolev, licensed at Shutterstock.com

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Comments

  1. says

    The weakness of your argument is that you try to apply for-profit business models to non-profit organizations, and especially to organizations that are not even involved in competition. The two types of organizations work on very different principles.

    Shall we eliminate the Detroit Symphony because it has been unable to raise sufficient funds? There are no other symphony orchestras in town. The result would not be a better orchestra, but no orchestra. It is acceptable that a city like Miami with a metro population of 5.5 million never replaced the Florida Philharmonic after it folded? The city has now been without a fulltime, year-round professional orchestra for seven years and with no change in sight. (And lets not make the specious claim the New World Symphony is a professional orchestra. It is a training orchestra for students and young professionals in temporary positions.)

    You speak of eliminating cultural institutions when many cities hardly have any at all to begin with.

    Why does every European city with a population of 500,000 or more have a fulltime, year-round opera house while Americans do not have any? (Even the Met only has a 7 month season.) Why does Germany have 83 fulltime, year-round opera houses while we only have about six real opera houses for a country with four times the population? Every European in a larger city can attend a local opera house, but most Americans would have to travel hundreds of miles.

    Why does Germany have 136 fulltime, year-round orchestras while we only have 13?

    Why does Berlin have 3 fulltime, year-round opera houses, Munich 2, Vienna 2, and Paris 2 (just to name a few examples.) These houses do 5 to 8 performances a week, all year. By comparison Los Angeles with from 4 to 6 times the population has what by comparison would add up to about a 2 month season. The so-called Washington National Opera is a joke of a company with about a 2 month season — for the world’s most powerful capital.

    How do you build interest in cultural institutions when they are already hardly even available? It looks like the elimination process happened long ago. So what do you want, to reduce things essentially to zero?

    Publics are not built merely through marketing and efficient business models (as hard as that might be for an American to understand.) They are mostly built through education, and through public funding systems that allow for local arts institutions where tickets are available at affordable prices. That is why every developed country in the world except the United States has a comprehensive public funding system for the arts.

    How you can live in Europe and overlook this is very bizzare. The numbers of institutions AND attendance show over and over and over how much better the European system works. That is why neo-cons who want everything privatized, seize on every little set back European cultural funding might have to try to claim their system isn’t working. (And don’t give me the neo-con malarkey that they are moving toward our system. It’s not true, and is in fact a neo-con lie.)

    Our funding system by the wealthy is in reality a form of neo-feudalism and is inherently dysfunctional. I hope you will eventually understand this and begin using your time in Europe to learn about their public funding systems. You could then help Americans understand that they need to at least gradually join the rest of the developed world and build a comprehensive system of public arts funding.

    For a more extended discussion of this topic, go here:

    http://www.osborne-conant.org/arts_funding.htm

    P.S. Actually, I realize that repeating the usual American tropes about arts business models increases your chances for employment because the system in the States will change only slowly. You have to become an “expert” for a system that is inherently crippled, like a vetinarian for one-winged birds.

  2. says

    I think my only quibble is with the idea that being mission-driven precludes the idea that the people working for that organizations should be well-paid. You can’t achieve the mission if you don’t have the people to support the mission. The only thing being a not-for-profit precludes is using surpluses to reward shareholders, rather putting such surpluses back towards the mission. But unless we start understanding the importance of compensating our staffs and artists reasonably, that will continue to be a drain on our exceptionally important human resources that will lead us to future successes.

    Other than that, I addressed the diversity issue in ArtsAppeal myself and agree wholeheartedly. And the conversation about what to do about failing institutions is important, but I don’t hold much hope that the egos and inability for folks to acknowledge and move past sunk costs will allow for reasonable trimming of the tree without some external force coming into play.

  3. says

    I appreciate that you joined the perspective of the arts as an ecosystem. The American non-profit arts community can be viewed as an old forest that is stunting new growth and whose dead wood is increasing the likelihood of an unchecked conflagration. And just as scientists and government groups struggle with whether to conduct controlled burns at the risk of starting the very blaze they were trying to prevent, so too must arts leaders and foundations work to find ways of decreasing the decaying organizations without weakening overall public support for the arts within the local community and the national scene.

  4. says

    I live in the Midwest and I’ve often wondered if growing and sustaining art isn’t more like growing food. Could the agri-business model be more useful in this conversation? Farmers have been subsidized for nearly a century and supply and demand has remained fairly constant. People need food. I like to think that people need art in the same nourishing way.

    • V. Abrash says

      Actually, when supply outstripped demand in agriculture, the government stepped in with subsidies which dwarf arts funding. These subsidies often profit just a few conglomerates, to the detriment of the environment, the food supply, agriculture, health and, alas, even farmers. In that way, maybe not the best model for the arts.

      But it is worth noting that the U.S. has a tradition of supporting sectors that can’t support themselves on the open market, and of promoting new uses for abundant product.

  5. Carlo says

    A Tale of Two Cities:

    When the Baltimore Opera could not continue to pay its expenses, it went into bankruptcy and eventually disbanded.

    When the Washington Opera could not continue to pay its expenses, it arranged a merger with the Kennedy Center.

    Is the answer for failing arts organizations to become wards of the state, as in Washington?

    By the way, the National Symphony Orchestra of Washington made the same arrangement with the Kennedy Center a few years ago.

  6. Pete Miller says

    Dianne,

    I follow your argument in the abstract, and couldn’t really argue against it in that realm. I’m having more trouble, as I look out on the DC theatre scene which I know well through the lens of your argument, finding that standing deadwood. I feel like I can’t usefully engage in this discussion until somebody starts identifying specific candidate institutions to refocus or shut down. That’s going to be a hard thing for anyone on the inside.

    Let’s assume you are spot on with your argument as a matter of logic. What is the path forward to winnow mission accomplishing organizations from time marking organizations?

  7. michael rohd says

    It is as if, by making space for this conversation, one makes a fun house mirror that reflects back to the reader their greatest fears and biases about the arts ecology and industry, and actually engaging with your core question, as i see it, is practically impossible.

    You ask about relevant institutions. About what makes an arts institution relevant.
    At the root of Rocco’s comments, and yours, is this inquiry.

    Not strategies to help us ape European Opera and Symphony ecology as a demonstration of cultural relevance.
    Not how we make sure artists and arts institutions are compensated fairly.
    Not even debating how we make certain this conversation doesn’t weaken our position as a field.
    Of course these things are related.
    Of course we have a myriad of issues to address.
    But lets have the hard talk, the one you invoke-

    What makes an arts institution relevant?

  8. Lewis Martin says

    I agree with the sentiment. Years ago I lived in Alabama for almost 20 years. There were Symphony orchestras in 4 cities, only one of which could actually play a piece of music through without sounding a bit like Harold Hill’s band in THE MUSIC MAN. The good one, the Alabama Symphony under Paul Polivnick, was a very fine regional orchestra, playing in a good (if too large) hall. The others, in Montgomery, Huntsville, and I believe Mobile, were not so good. But because Alabama was militant that arts money be allocated on a more or less per capita basis, much that was good went unfunded, and much that was mediocre got full funding. I sat on professional panels that were annually overruled by the arts politcos.

    The Alabama Symphony should have thrived, playing concerts throughout this rather poor state. Instead it finally died through lack of funding and opportunity to create income. 4 orchestras were funded, where only one could be called a truly professional group – but community pride – “we have an orchestra too!” – was allowed to trump artistic concerns.

    This happened then, and continues to happen throughout America. Its fine to start of small, and be the little engine that could. But you have to achieve at a high level too.

    The Arts Council of England does it right – if you’re not good enough they make recommendations – if you can';t implement them and raise your standards, bye bye grants.

    If there were any true qualitative benchmark for arts grants in America from government, the squeeze would be a lot lighter.

    But as I was told by the NEAin the ’70s (and arts dollars have not increased a penny since 1975 in real terms), “You have to help us get more money. We can’t take anything away from the organizations we already fund, in order to help you. We can only help you if the pot gets bigger.” Those same 1975 organizations who took the lions share of funding, still do.

  9. says

    If Rocco or Diane gave some actual numbers to support their claims about an over-supply of arts institutions, they would be more convincing. We should not buy the idea that there is an over-supply until they prove it, because in reality there isn’t one.

    It is notable that Rocco limits his discussion to theaters. Small, amateur, or semi-professional groups have a relatively small overhead and are easy to form. He probably uses this as his claim, and ignores the fact that there are very few genuinely professional, year-round houses in the United States.

    If his argument were applied to other genres of performing of performing arts, like orchestras and opera companies, the absurdity of his claims about over-supply would be immediately apparent. That’s why he remains silent on that topic.

    And now we see the comments to this blog speaking about a tree that needs trimming, and another speaks about an over-grown forest. What tree? What forest? Before you pull out the cutting knives, show us what exactly is over-supplied? Or is it simply cutting that is the agenda, needed or not?

    For those interested, check out the season colander of the Amsterdam Opera (right there in the country where Diane is living.) Note how there is a performance almost every night all year except for when the house closes for its six week summer vacation:

    http://www.dno.nl/home.php?&lang=uk

    Or check out the season of the Rotterdam Opera, which is just as complete, and for a city of 600,000:

    http://www.operarotterdam.nl/agenda.php

    And this is to say nothing of the Rotterdam Philharmonic and the Concertgebouw in Amsterdam. Open your eyes, Diane, and you will see how the arts are organized in a way that works far better than in the USA.

    • says

      Mr. Osborne,

      Thanks for both of your posts. Just to clarify a few points:

      (1) I am not an ‘advocate’ for the American system; if anything, I see great flaws in the American model. But this is the system we have. Thus, I am responding to the reaility in the US. I am very aware of the full houses and subsidized programs in Europe as most American arts people are. It would be rather inane for me to suggest that the answer for US arts organizations is to obtain large government subsidies and adopt the European model. Are you familiar with the empty seats at many orchestras in the US the past ten years? And yes, some of it was due to pricing at some orchestras. But there are orchestras – the St. Paul Chamber Orchestra, to name one — that have figured out how to keep prices low, be relevant, and still balance their budgets (despite existing in the American model). I’m not persuaded that the thing that is keeping orchestras in the US from having affordable tickets and relevant programming is lack of enormous government subsidy. But even if it were, we can’t really turn back time and change the course of the NEA. Nor can we get a re-do on the decision to eliminate arts programs in schools so that more people today could appreciate the arts. Because I suggest that we need to look with clear eyes at the exponential growth in the number of arts organizations the past few decades, against the declining participation rates and deal with this reality is not to suggest that I don’t believe the arts deserve support. Relevant organizations that are doing excellent work, engaging their communities, and managing their operations ethically, transparently, and responsibly absolutely merit support.

      (2) I think that the fact that 41 percent of arts organizations were unable to balance their budgets in 2008 gives a good sense that there is competition for resources and that many organizations are not reliably able to secure the funds needed to operate. If you talk to 100 arts leaders in the US, I believe they will also tell you that they must compete with other organizations for audiences and contributions. There is a reason why the development and marketing departments in US organizations are so much larger than their couterparts in Europe. Raising money is a core business for most US arts orgs. And, sadly, artistic directors must often spend as much or more time fundraising than overseeing artistic programs. The National Arts Index also includes specific data regarding declining attendance against the increasing supply of organizations and suggests that we have an ‘oversupply’ or ‘underdemand’ problem. Government arts agencies across the US will tell you that every year they must slice the (sometimes shrinking) pie into smaller and smaller slices.

      (3) I am not suggesting that organizations with financial difficulties (i.e., The Detroit Symphony in its current state) are the ones that should be reorganized or closed. In fact, I make the very point that I’m describing dead weight as those that do not provide great cultural or social value relative to the investments in them. The ability to balance the budget is not the primary metric for determining whether a nonprofit organization has cultural or social value; and perhaps if some organizations that are not providing great cultural or social value were to be defunded more resources would be available for great organizations like the Detroit Symphony.

      • Heather Beasley says

        Where shall we look to define “cultural and social value” as metrics that we can use internally within arts organizations and externally by funders? This is a key problem in eliminating dead weight. If arts organizations take on the responsibility of defining these terms, how do we get buy-in for our definitions?

        Funders ask for quantifiables in grant applications, and shy away from defining “excellence” or “relevance” in ways that are clear enough to measure actual success in achieving them. These qualities are like pornography: from the NEA down to the local level, funders don’t define artistic excellence, but they know it when they see it.

        When return-on-investment cannot be measured directly in dollars or in butts-in-seats, how CAN we measure it? I feel like postmodernism killed the idea that we can define value terms absolutely, but we (non-profits) can’t refuse to define them and still be able to claim we are serving the public good. There’s a difference between mission failure and mission creep. The first is a gap between an organization and the public. The second is an organizational strategy to bridge the gap between organizations and funders, in order to ensure economic survival in the competitive market you describe. I’d like to avoid both, so am seeking alternatives.

      • says

        What if we look at the exponential growth as an indicator of potential demand? What if we look at the decline in funding as the problem to be addressed? Where is the argument for investing in audience engagement initiatives to reverse the trend of declining attendance? Who’s to say that decline is an indicator of failed mission rather than a loss of market share to the more heavily financed commercial media? Isn’t the new data from social research telling us that people want more participation in the arts? Why do we expect the artists to market their own product when they clearly can’t compete? Why isn’t this conversation about the responsibility of the business sector to invest in the arts that enrich their communities? What happened to the Art Works argument?

    • says

      Willian, you seem to base a lot of your argument on level of activity of European artforms staged in European cities? Isn’t America (like Australia) a relatively new culture that may benefit from some new growth, let alone some culture more relevant to its unique circumstances – not museum pieces from another era and another world?

      • says

        Tom, it’s true that would should develop our own American art forms. In Europe, we see that the societies that most strongly support their cultural heritage are also those who invest the most in new, experimental and exploratory art forms. I think the same would be true for America. Cultures that grow and evolve always build upon the knowledge and expertise of the past. The more we support traditional opera, for example, the more we will develop our own American forms of music theater. In short, it is not an either/or situation. As a general rule, when it comes to culture, the new and old grow hand-in-hand. Take one away and neither grow.

        Aaron, thank you very much for the link and the data. I am familiar with the NEA study, but I think it is very difficult to extrapolate a conclusion of over-supply from those numbers. The simple term “non-profit” can mean almost anything, so we have only the vaguest notion of what we are actually measuring. We know that non-profits have increased, but the term non-profit can describe countless types of organizations that are not directly related to the funding and attendance questions with which we are dealing.
        Most likely, it just means there are a lot of little organizations with very small overheads out there filling very small niches in the regional arts world – some of which might not even be oriented toward the public.

        I think it is much more useful to analyze concrete numbers for major cultural institutions like fulltime, year-round orchestras, opera houses, ballet companies, and major museums. The comparisons I provided for Germany are an example: 83 to 0 for fulltime, year-round opera houses, or 136 to 13 for fulltime, year-round orchestras. With numbers like that, we know what we are actually measuring and comparing.

        Also, how can we claim supply exceeds demand in terms of attendance, when we do so little to build interest by creating educational programs, by making sure local orchestras and opera houses are available year-round, and by making sure tickets are affordable? We consciously let interest wane, and then use that for an excuse for eliminating cultural institutions.

        • says

          William,

          I go into more detail in my response to your comment over at Createquity.com. Yes, it is possible that most of the “23%” of new organizations are tiny niche players. However, the data is not completely irrelevant, either. More on the data over at Createquity.

          Also, just because an organization is a niche one does not mean they can’t possibly contribute to oversupply. If my child’s school produces school plays more often, that truly does mean I have less time to attend Chicago Symphony Orchestra concerts.

  10. V. Abrash says

    If every theater company in America automatically qualified for a share of the available funding, then it might be worth talking about ‘oversupply.’ But in the U.S.,every theater relies on funding & ticket sales. The marketplace is a simple, extant, all too ruthless ‘mechanism for communities to identify and deal with mission-failing organizations.’ Theaters that fail to convince audiences & funders that they deserve to continue don’t survive. If they are able to continue, it is because someone sees merit in their continuity.

    I’m not clear on exactly what other selection process Rocco Landesman & Diane Ragsdale favor to find the ‘right’ theaters to survive. Currently, funders who think ticket buyers are missing the mark step in with support when needed. If they don’t, the theater folds. Simple. Support can come from many sources, but it only comes if SOMEONE thinks the theater is worthy.

    Would they forbid me from spending my Aunt Mamie’s bequest on my theatrical vision because a few of my friends might come to my production of Gammer Gurton’s Needle instead of attending the theater that has been chosen as ‘right’ to survive? It is specious to suggest that funding and audience would go to ‘better’ theaters if the ‘wrong’ theaters shut down. If I can’t have my theater, I’ll spend Aunt Mamie’s cash on food & travel – outside my community, thank you very much. & my friends are only coming to the theater to support me. If I can’t make theater, they’ll join me for dinner instead. On the other hand, some of them might have liked my shows so much that they began to go to other theater too. Studies show that people who attend one arts event are more likely to attend others as well.

    Of course funders must make decisions about where to spend their always limited resources. With NEA funding so paltry compared to need and to other developed nations, not all worthy theaters will receive anything approaching sufficient federal support. As it is, only theaters that are deemed worthy by a pretty demanding process ever receive NEA funds. Similarly, ticket buyers can’t afford to see as much theater as they would like — the main reason for diminishing arts viewing, in my experience, is rising ticket prices, a constant through the period of declining attendance due growing costs & limited funding. Those are unfortunate truths. But that does not in any way translate to a blanket statement that there is too much theater.

    And without a doubt, the timing of this conversation can only harm American theater. For leaders in the arts world to paint oversupply as the most important thing to talk about in the American theater scene at a moment when many are seeking to end all federal support of the arts is akin to suggesting that a man dying of dehydration be denied water because it might lead to water weight gain. Well,maybe yes, maybe no, but if you want the man to live, it’s the wrong thing to focus on.

  11. says

    Thank you for your clarifications, Diane. I still see a problem with the idea of cutting dead weight. Even if there is a significant amount (which has not been proven,) and even if it were cut, the sums gained would still not be adequate to give us the institutions and educational programs we need. So what dead weight we have, isn’t really the problem. It is at best, only a very small, temporary fix.

    I agree that we need to work with the system we have, but at the same time we must constantly stress that our system is inherently dysfunctional. Only when this is widely understood, can we move toward a public funding system — which is the only system that works. No one is in a better position to see this than you. I hope you will continue to learn about the European system and provide Americans with expert knowledge about how it works and about how we might begin to move in that direction.

  12. says

    I enjoyed this post. I have also been following the discussion after Rocco Landesman’s bold statement and I think that the issue of supply and demand in the arts was a difficult but brave conversation to start, and needs to continue. Mr. Landesman’s view of demand is not only quantitative. He pointed this out very well in his NEA blog entry last week.

    This statement in your post really hit home: “Optimistically, I believe that there is ‘pent up demand’ (read: need) for the arts that is not being realized because of financial, geographic, cultural, educational, social, logistical, programmatic, and other barriers to participation. Pessimistically, I do not see many nonprofit arts organizations radically adapting their institutions to address these barriers.”

    You hit the nail right on the head. We are undergoing a cultural shift in artistic demand, not just a quantitative decline in audience numbers.

    Arts organizations seem to have difficulty confronting brutal facts and adapting to change, maybe because they are simply too busy fighting to stay alive day to day, or maybe because they are the largest, oldest trees in the forest who feel they just deserve to keep on doing what they believe they have always done best. The latter is a fool’s argument that is far too prevalent in the arts. Old, flagship arts institutions that dominate a particular city’s cultural landscape are deeply rooted in their ways. Henry Fogel once shared a great quote about the orchestra business. “Big ships might turn slower, but they sink faster.”

    Arts groups that want to address change need enough cushion of time and money to step back, reevaluate, retool, and reopen. Sadly, some organizations can’t find a safe haven to do this work and get out of mission-failure. If arts organizations can’t adjust their ways and means in order to adapt to change, then ultimately the market will decide if they survive, just like in any other industry.

  13. Mame Hunt says

    Mr. Osborne asks why all those European cities have numerous operas and symphonies and the U.S. does not. At the risk of being snarky, these cities and nations give a sh*& and the U.S., with some exceptions (like New York and Chicago), does not. European cultures are more geographically focused and have a history of hundreds of years of going to the symphony and getting their bread around the corner from the opera house. They SEE the institutions they support as they go about their day (and the buildings themselves are nearly always beautiful, which cannot be said in the U.S.). We are just too decentralized and suburban and spread out. And our culture is one of individualism, which further alienates us from the performing arts, which are hellbent on having us in the same room (Ooooo ick!) Who has time for art? We MUST move forward, ever individualistically, ever craving. We must compete with our neighbor for that raise, that car, that coat, that grande half-caff latte, no foam, extra room, extra hot. If we sat next to that neighbor at the symphony and both of us began to get misty at Rachmaninov’s Third, — well, it would be plenty difficult to cut him/her off in rush hour traffic the next morning.
    The current discussion about letting some institutions fail so that the survivors can be stronger and more devoted to their missions — it’s yet another battle in a war that is already lost. When funding for arts in the public schools was cut a couple of decades ago — that’s when we in the non-profit arts lost the war.We are not raising our children to value the arts, so it will continue to be a refuge for a dwindling few. And no matter whether there are too many concerts for the Few or not enough, or none at all — the Few will still go, forever and ever, world without end.

  14. Kristin Patton says

    Rather than fixating on how best to apportion scarce resources, I’d love to see the broader conversation framed as how do we more meaningfully INVEST in the arts? To the question of relevance – what is working? Where is art making flourishing? How can we do a better job of supporting and leveraging that? The demand/supply/competition for scarce resources question is relevant – but to gain helpful insights we need to identify and consider fuller measures than attendance figures and number of institutions.

  15. mark lord says

    Some observations:

    A significant increase in the *quality* of the supply will increase demand.

    Statistical observations about culture participation rates are totally skewed by what we define as “cultural”.

    One of the most “successful” veins of non-profit theater is the one that replicates the product of the commercial theater, recycling their “product” under the (false) rubric that they are providing a resource that merits non-profit status. This pollutes the entire funding and assessment process (based on my experience of how things work in my home town, Philadelphia.)

    My friend and collaborator Andrew Simonet posits the model of scientific research (which is done in small research groups for an audience of interested parties) vs. popular science museums, which exhibit recent advances in science to the public, but which are not actually doing original research. Both are important, but they are not the same thing. We tend to support the “museums” and not the original research.

    In my opinion, we need to support explorations in new theater, but what passes for new play development in the US is largely not the development of new theater, but the creation of “new” plays in antiquated forms.

    I do agree that this is an important conversation to have.

    • says

      Thanks for the link, Diane. I should hasten to point out that the author of that post is not me, but rather one of Createquity’s new Writing Fellows, Aaron Andersen. I am working on my own response to the #supplydemand debate, but it’s going to take probably another week or two since I am finding myself challenged to tie together virtually all the themes that I’ve been writing about on Createquity for the past three years. If I manage to sort it all out, I can promise it’ll be a doozy. :)

  16. says

    I have not read the comments before mine. Let me admit that and then say a word for capitalism, and the efficiency of the free market.

    There are lots of restaurants, and most of them go under. Everything changes, and in time everything passes away. In these times lets not ask government to play a larger role than it can meaningfully play. These are difficult times for the ENTIRE ECONOMY. Banks and car companies are going under and if our sector is losing businesses at a smaller rate it’s because we’re used to scraping by, and refuse to give up the ghost. Government funding is the smallest portion of sustainable arts organization budgets, behind earned revenue, private giving, foundation giving, and corporate philanthropy.

    We’ve seen over and over that government is a really bad “taste-maker.” That’s not what it does well. Government funding CAN spur, and can sustain, but this article suggests empowering some group of folks and what that sounds like to me is a way for folks with influence to ensure that their point of view is taken by government funders. I do not disagree that there are mission failing businesses, and failing non-profit businesses, but it would be inappropriate to grow government influence in the arts in response. Non-profit businesses are just businesses.

    • mark lord says

      Imagine how well we’d be doing in education and science if we followed a free market model. I concede that the government doesn’t do as good a job as I would in doling out the funding dollars, but if Americans want to have culture that is sophisticated in any way beyond our pop culture, we’re going to need to support those enterprises, just as we support schools and scientific exploration.

      Non-profits may not be great businesses, but I’m not sure you really want to be holding the wonders of good old American Business over our heads just now. Didn’t the government–under both Republican and Democratic administrations–just need to bail out a whole bunch of companies?

  17. says

    “We lack a sound mechanism for communities to identify and deal with mission-failing organizations—those that refuse to adapt or close despite a preponderance of evidence that it would be better for society if they were to do so.”

    I think this statement opens a can of worms that we are not prepared to deal with. Firstly, who would have the right to dub an organization “mission-failing” and by what criteria. I see organizations that have been in existence for over 50 years, clunking along, producing low quality work, but they still are fulfilling their mission statements of “providing art to the community.” We may be able to weed out a few based on “mission-failing,” but many are still compliant with their vague mission statements.

    Secondly, then we would need to address the quality issue which I feel is the bigger elephant in the room. Most funding sources do not have a yardstick for quality except for how well a grant is written. These sub-par organizations can hire someone stellar that knows how to write and spin to make their projects appear worthy of funding. Perhaps more dvd’s or visual presentations need to become mandatory, but art is still a subjective business, and who is to say what is quality and what is not.

    These elephants may not be dealt with easily since the third elephant, ego, will trumpet. I still feel strongly that we need to work on the issue of demand. Yes, the reports say attendance is declining, but why? To me this is the underlying cause to begin with. We are at a point that even if we were to rid ourselves of some of the supply, without the demand, the arts may still be underfunded and under attended.

    http://audiencedevelopment.wordpress.com/2011/02/02/audience-development-rocco-and-the-buzz/

  18. JOHN HACHMEISTER says

    I keep reading “European Model”, but there is no mention of any other model, save the “American” one.
    Perhaps the real issue is that we are not now “European”, our culture is rapidly moving away from
    any old world view point. For example. where is analysis of the “Latin American Model”?
    When the arts do not reflect and address a given culture, those arts should not expect recognition from that culture.

  19. george patrick says

    I agree wholeheartedly with your blog post.

    Nonprofit arts organizations still can’t seem to shake the idea that solely because they are nonprofit they are automatically victims of changing markets — kind of like the suffering artist argument. It’s true to an extent – they are here for a mission, not a profit and are formed and run with the best of intentions, but at the end of the day they all still exist in a country where a free market prevails.

    We’re taught in college art admin programs (recent grad) to start looking at nonprofit organizations as nonprofit businesses. Applying modern business models and methods to help secure our mission in the market we choose (visual, performing, etc). The free market that determines the price of our bread and milk is the same that determines the price of our ticket. Keeping competitive ticket prices, package prices, product or service prices are all a part of running an arts organization, so saying that the market does not affect an arts organization is completely null and void.

    And to be honest, I do feel there are a slew of nonprofit arts orgs that simply do not need to exist anymore. Everyone has their own view on art, therefore there are an almost infinite number of patron bases that could be pulled from – but the more choices, the less sales. Unfortunately we all need money to run our respective organizations but we need to stop blaming everyone else and look in a mirror. Sometimes an organization’s leaders may think they are doing something different than everyone else, when in reality they are not. You may do more benefit than harm by a) folding b) restructuring or c) merging.

    Times are changing and the whole arts system is not immune to it. And it’s changing for good, not just for now.

  20. Jonathan says

    Much has been said about “The European model” here, but that model is coming to an end.

    Yes, indeed, European member states still do support their own culture(s) by many more factors than the US national or state governments, but the general move is towards the dismantling of state support — just as the public transport systems, postal/telephone systems, power/water systems, and health care are being liberalized, or as they say, “Americanized.” Opera houses are shutting down (especially in Italy), orchestras are being decommissioned (the Dutch Broadcasting Orchestra, for example), and concert halls are being privatized.

    We’ve ALL got the same problems.

    The question is how we as a sector determine who stays and who goes. Are we going to let the popularity contest of the market decide? Are we going to let (as the lady says) “government death panels” decide?

    Or could cultural institutions find a way to work together to regulate and indeed increase their own cultural relevancy?

    • says

      It is simply not true that the European funding model is coming to and end, or that Europe is moving toward the American system of arts funding. That’s neo-con propoganda that is fooling a lot of people.

      Please check this table from “The Council of Europe.” They surveyed 36 European countries and give the numbers for yearly public arts funding from 2000 to 2008. Government expenditure for the arts went down in only 2 of the 36 countries.

      http://www.culturalpolicies.net/web/statistics-funding.php?aid=117&cid=80&lid=en

      Let’s stick to the facts.

      • Jonathan Talbott says

        Maybe the 73 000 Dutch people who took to the streets in support of state funding for culture last November will stem the tide and and make sure that the slashing of the culture budget and the tripling of VAT on culture will remain “neo-conservative propaganda,” but I’m not so certain.

        The figures you give are accurate, yes, but they are pre-crisis, pre-Iceland, pre-Portugal, Ireland, Greece, and only partially reflect the continuing financial effect of the conflict in Afganistan. They are in general from before the current crop of politicians started to propose plans for social security fixes.

        European governments are looking for money and they are taking it from their culture budgets, that is a fact.

        What the cultural sector does next., that’s the where it will get interesting.

        • says

          No one has a cyrstal ball, but I seriously doubt the latest economic downturn will cause Europe to begin dismantling its public arts funding They have weathered worse. One cannot assume that belt tightening in hard times represents a change in ideology. In fact, if I had to predict, it will be the USA that will eventually move toward the European model.

  21. says

    The primary problem with your argument is that you think out of the left side of your brain and try to apply supply-side principles to an “industry” that continues to be created and staffed by right-brained people who primarily want to be expressive and creative. That being the case, who decides who’s allowed to be creative, or is “mission-failing,” or is obsolete, or “isn’t necessary,” or doesn’t attract enough buyers, ad infinitum? Ultimately, it’s a silly argument. People will forever wish to be creative and try to bring their creativity to market, or stay at home strumming their guitar. Let the artists decide what they want to do. Free the right brain! Stop trying to control it with all this left brain worship of the Almighty Number.

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