NOT long ago, Karel Srp languished in jail for the ``crime'' of publishing banned writers and promoting banned music. Today, he is deputy culture minister of Czechoslovakia and has opened an uncensored bookstore and music cafe - in the disbanded Institute of Marxism and Leninism. But all is not well for Mr. Srp and his exciting new venture.
``We're close to bankruptcy,'' he says. ``Czech culture is finally free and we haven't any money.''
Throughout Eastern Europe, artists are struggling to adapt to their newfound freedom. Even if their art used to be suppressed, it also was subsidized. That comfortable, coddled existence has been replaced by cutthroat competition, just when deepening recessions are forcing cash-strapped consumers and governments to cut back spending on culture.
In Hungary, opera singers went on strike this summer after the minister of culture refused to grant them pay raises. In Poland, hundreds of underground publishers who flourished under martial law as a reaction to all-encompassing censorship have gone out of business since the installation of press freedom. And in Czechoslovakia, which suffered a serious loss of talented filmmakers such as Milos Forman and Ivan Passer after the 1968 Soviet invasion, filmmakers again worry that they will be driven into exile, this time for financial - not political - reasons.
``You just can't make money on a Czech film,'' complains Jiri Menzel, the Academy Award-winning director of ``Closely Watched Trains.'' ``We may have to begin making our films in English.''
This rude economic shock has been accompanied by the sharp transition from courageous dissidents to jaded office holders. Under communism, the artist - whether a writer, painter, or musician - was charged with a sacred mission of guarding and treasuring the national conscience. When the revolution came, men such as Czech playwright Vaclav Havel, Polish historian Branislaw Geremek, and Hungarian writer Miklos Haraszti led the charge to the barricades.
Mr. Havel now is Czechoslovakia's president, and many of his fellow artists have become ministers or ambassadors. Those who have continued to work as writers or musicians have lost their prestigious positions within society to the political elite, and in a certain sense, their freedom to criticize. Many of their former colleagues don't appreciate close scrutiny. Even Havel, the former imprisoned playwright, has demanded retractions from the newspaper Lidove Noviny, which he helped found as a clandestine publication.
``There was a cartoon mocking Havel and he called up furious that he was being criticized,'' says Klara Jiraskova, whose father penned the drawing. ``It's just like in the bad old days.''
Artists also worry that freedom has cost them their best subjects. Adversity, they say, taught fundamental moral lessons, forcing artists to deal with deep questions of existence. Havel himself has joked that he might ask the new government, which he leads, to send him back to jail two days a week so he can write.
``When conditions of life were difficult, when there was persecution, it was the time that artists could find glory,'' says Czech novelist Ivan Klima, one of the few leading writers who have refused to take an official post. ``Life now is boring. That doesn't make for great books.''
It also doesn't make for voracious readers.
East Europeans used to analyze books for the flavor that they injected into an otherwise drab life. All classes in society read, from the lowest of manual workers to the most rarefied of specialists. Before the revolution, publishers in Prague used to sell more copies of William Faulkner in their country of 13.6 million than were sold in the entire United States. Even volumes of esoteric poetry regularly enjoyed first printings of 10,000 throughout the region.
Despite those large print runs, demand outstripped supply. A popular or controversial book sold out in minutes. At the Prague bookstore Arbes, customers would line up each Thursday morning beginning at 5, waiting for the weekly shipments.
The queues are gone as new publishing houses have stopped printing unpopular volumes of Engels and Marx and begun pouring out uncensored works. Today, readers who once had to spend hours searching out a good book or who passed around typewritten stories of samizdat literature can walk into bookstores overflowing with volumes by once-banned writers such as Milan Kundera, Ivan Klima, and Josef Skvorecky.
``Each book used to be a festival, each page was so precious I could taste it,'' says Mr. Menzel. ``But now I can buy entire packets of books. The choice is overwhelming.''
Competition is fierce. Two years ago, says Gabor Demszky, president of the Budapest publishing house AB Beszele Ltd., there were about three dozen publishers in Hungary. Today, he counts more than 300.
Czechoslovakia has 500 publishers, according to deputy culture minister Srp. These figures don't include the large number of 'emigr'e publishers who, able to freely circulate their books for the first time at home, are sending large numbers of volumes. And there still are only 15 million Czechs and Slovaks and 10 million Hungarians to soak up all this extra production.
``It is far too much,'' Mr. Demszky says. ``People active in publishing must have large financial resources in order to survive because the demand is lagging behind the offer.''
Publishers complain that they cannot sell serious books by formerly banned writers. Aleksandr Solzhenitsyn's ``The Gulag Archipelago'' recently was released in Hungary. ``The book, a bestseller everywhere else in the world, was not sold out here,'' Demszky says.
Former readers enjoy many more potential distractions than before the revolution. The end of ideological quotas means East European television, which used to be dominated by boring propaganda, suddenly is full of Western sitcoms and dramas, and cinemas that specialized in Bulgarian features now offer first-run Western releases. Once-rare entertainment offerings like rock concerts are much more common - the Rolling Stones recently played in Prague to more than 100,000 frenzied fans.
So much energy has been expended over the past year that East Europeans search for escape. The most popular piece of entertainment on Polish television is ``Dynasty.'' ``We're losing our taste,'' laments Menzel. ``The level of our spectator is going down to that of in the West.
ALONG with Western productions, Western entrepreneurs are pouring into Eastern Europe. Press magnates Robert Maxwell and Rupert Murdoch have taken large shares in Hungarian newspapers, precipitating a backlash against foreign ownership of the news media. Foreigners soon could dominate local publishing and film industries. After the Hungarian government ended subsidies to the state-run film industry, Western producers rushed in to take advantage of low studio costs.
``Hungary no longer has its own film industry,'' Menzel says, ``and if we aren't careful, the same thing will happen here.''
Srp, the deputy culture minister, agrees. Although he says President Havel and the rest of the Czechoslovak government want to keep subsidizing the film industry, he worries that there won't be enough money in the state coffers. ``We need 400 million crowns [$12 million] for next year,'' Srp says. ``But the finance minister is warning us that this may not be possible'' because of the budgetary crunch.
In the United States, private donations might make up the difference. Not in Czechoslovakia. ``We don't have any rich people who could give donations,'' comments Mr. Klima, the author.
Adapting to the shock of the free market is producing some profound ironies. Under the Communists, Srp created the ``Jazz Section,'' with activities that went far beyond supporting jazz to include art exhibitions and publishing. As exiled Czech author Josef Skvorecky has noted, the organization's book series and monographs ``became a haven for authors, artists, and theorists of art interested in series and trends that were, for all practical purposes, outlawed.''
The Jazz Section's influence alarmed the Communist authorities, who banned it and arrested its leaders in September 1986. At a widely publicized trial, Srp was convicted of illegal commercial activities and sentenced to 16 months in jail.
Today, Srp no longer has problems publishing books or holding art exhibitions independent of state control. His new Artforum center has two galleries in addition to its bookstore and music cafe. But instead of fighting for freedom from the state, Srp now is fighting for subsidies.
``Although the government helped us by letting us use the building free of charge, we need much more money,'' he says. ``Freedom is quite expensive.''