Federal Government Money Is Not The Best Way To Fund The Arts

Arts lovers: go ahead and write your letters to Congress asking for level funding, that 6% increase, or whatever you want. But once federal funding becomes less of a joke, it may well become more of a headache.
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If you were expecting a fiery screed against the evils of the National Endowment for the Arts or the inherent wastefulness of government funding, I'm sorry to disappoint you. I support the NEA and will fight any and all efforts by either party to drive its already "pathetic" budget even further into fiscal oblivion. Indeed, I believe that government has an important role to play in distributing and equalizing opportunities for making and experiencing art, especially geographically and across class divisions.

But that's not the question at hand. The Huffington Post doesn't ask us whether the federal government should support the arts, it asks whether federal government money is the best way to support the arts -- a key distinction. For as much room as the United States has to step up its commitment to the arts in the form of public dollars, we are not likely to see the federal government become the primary source of support for the arts in this country in our lifetimes, or those of our children or children's children for that matter. And frankly, that's probably for the best.

This year, Americans for the Arts (our field's chief advocacy group) is asking for $155 million for the NEA, a 6% increase over last year's enacted level, and $12.5 million below the agency's appropriation in FY2010. Such small potatoes! But the truth is that the NEA's budget could increase a hundredfold and still not pay for even a quarter of nonprofit arts organizations' $63 billion in annual spending. Where does the rest of the money come from? Not from the government, according to a study commissioned by the NEA itself. Taken together, federal, state, and local investment generates just 13% of the typical arts organization's budget. (And that number almost certainly goes down even further when you throw for-profit arts organizations into the mix.) No, the vast majority of arts funding in the United States comes from the private sector: either earned revenue from ticket sales or other services, or donations from foundations, corporations and individuals. And most of that money comes from people like you and me, voting with their dollars.

Arts supporters in the United States often look to our more cultured brothers and sisters across the Atlantic Ocean with longing for their civilized systems of arts funding that provide far more capital per resident than our own. The numbers just look so inviting: Germany's federal government, for example, plowed some 1.22 billion euros, or about $1.7 billion, into its cultural ecosystem in 2007. That investment of over $20 per German citizen absolutely dwarfs the 41 cents per red-blooded American provided by the NEA. What artist wouldn't want to live there?

But that comparison is deceiving, because United States has a secret weapon: the charitable tax deduction, and more importantly, the culture of private giving that has grown up around it. It turns out that the counterpart to all that money that Americans give annually to the arts just doesn't exist in Germany, or any other developed country for that matter. Oh, to be sure, it would be inaccurate to say that there is no private giving in Germany - there is, and there are tax incentives for it too. But according to a 2006 analysis by Charities Aid Foundation, the USA's charitable giving is more than seven times that of Germany's as a percentage of GDP - and no other country in the sample comes even as close as half. Assuming that the percentage of money given to the arts is comparable between countries, we can figure that German arts organizations receive something on the order of $250 million per year in private funding, compared to $13.3 billion on our side of the pond. How do you like them apples, Berlin?

Perhaps that's why, in the face of recession-induced cuts, a number of governments in Europe are starting to give the American model more serious consideration -- and a number of European arts organizations are going after American donors. Which highlights another downside of a government-dominant system: any shock to public revenue streams could be life or death to grant recipients, rather than just another challenge to overcome. A survey of arts groups in the UK found that more than a ninth of those who lost their funding in a round of government cuts intend to close up shop, and another 22% considered themselves at risk of failure. And this was after relatively mild cuts of 15% from Arts Council England, which is already a bit of a hybrid between the European and American system. Dutch cuts of 25% last year resulted in a dramatic reshaping of the national cultural landscape that particularly affected smaller and grassroots institutions. Following federal government cuts of 100% in 2010, staff at Sarajevo's National Museum have gone unpaid for seven months! Here in the US, we fight hard every year for the NEA to survive, and we should - but there is nevertheless some comfort in knowing that if it goes away, the arts won't be dragged down the drain with it.

Finally, it must be pointed out that we can't take for granted that government funding for the arts will always be virtuous in purpose. One could argue that Western Europeans have lucked into a happy accident of history that combines exceptional largesse with a largely hands-off approach. Some countries, such as the former Soviet Union and modern-day China, have had no qualms about using state power to exercise censorship on a vast scale and co-opt the arts for nationalistic purposes. Closer to home, even Hungary's arts community has seen significant turmoil due to the meddling of a newly elected conservative government. And while it's hard to imagine anything destroying Sweden's commitment to public funding of the arts, the recent scandal involving that country's culture minister cutting a "racist cake" certainly gives critics some ripe material.

So, arts lovers: go ahead and write your letters to Congress asking for level funding, that 6% increase, or whatever you want. A $200 million or $300 million or even $500 million NEA would be a great thing for this country. But once federal funding becomes less of a joke, it may well become more of a headache. It's all well and good to point to the Europeans as a model; just don't be surprised if they're the ones mimicking us in the end.

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