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Michael Kaiser

As bailout plans bloom, don't let the arts wither

While government bailouts are being offered or considered for financial institutions, the auto industry, homeowners, and so many other needy and worthy sectors, one group is quickly and rather quietly falling apart: our nation's arts organizations. In the past few months, dozens of opera companies, theater companies, dance organizations, museums and symphonies have either closed or suffered major cash crises.

As someone who has made a career out of fixing troubled organizations, I know that the problems faced by arts groups are often related to poor management and governance. I also know that the difficulty in improving productivity in the arts is a central cause of our financial challenges: It takes the same number of actors for Hamlet as when Shakespeare wrote the play more than 400 years ago. Unlike other industries, the arts cannot cover the cost of inflation by improving worker productivity.

This is why subsidies — in the form of government grants or private contributions — have long been required to help arts organizations balance their budgets. Well-managed arts organizations have typically been able to find the money required to operate if they create interesting programs, market them aggressively and build strong donor bases.

But these times are different.

Many organizations that spent years building large endowments to provide more stable sources of support have seen them decimated. A number of our most loyal donors have watched their own investment portfolios be depleted and cannot provide their traditional funding. Our audience members cannot buy as many tickets as they have in the past.

This perfect storm has already weakened the fabric of our nation's arts ecology. Over the past several months, the Baltimore Opera Company, Santa Clarita Symphony, Opera Pacific, the Los Angeles Museum of Contemporary Art and others have closed or come close to closing. (In the Tampa Bay area, the Florida Orchestra is projecting a $1-million deficit for the 2008-09 season, American Stage has had to lay off staff and cut actors' pay, and the area's performing arts centers are putting on shows to more empty seats than usual.)

The arts have historically received short shrift from our political leaders, who all too often seem happy to offer bland endorsements of our work without backing those words with financial appropriations. But the arts in the United States provide 5.7-million jobs and account for $166-billion in economic activity annually. This sector is at serious risk. Because the arts are so fragmented, no single organization's demise threatens the greater economy and claims headlines. But thousands of organizations, and the state of America's arts ecology, are in danger.

We need an emergency grant for arts organizations in America, and we need legislation that allows unusual access to endowments. Washington must encourage foundations to increase their spending rates during this crisis, and we need immediate tax breaks for corporate giving.

As John F. Kennedy said, "I am certain that after the dust of centuries has passed over our cities, we, too, will be remembered not for our victories or defeats in battle or in politics, but for our contribution to the human spirit." As we print billions of dollars in bailout money, isn't it time to ensure that we are saving our soul as well as our economy?

Michael Kaiser is president of the John F. Kennedy Center for the Performing Arts. His book The Art of the Turnaround: Creating and Maintaining Healthy Arts Organizations was published in September.

As bailout plans bloom, don't let the arts wither 01/02/09 [Last modified: Sunday, January 4, 2009 1:58pm]

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