Proponents of the National Endowment for the Arts and National Endowment for the Humanities are raising alarm over the prospect of the United States abandoning its support of cultural institutions. Viewed from any objective perspective, that is a sad example of the Chicken Little syndrome ("The sky is falling, the sky is falling"). Large-scale support of America's art and culture does not depend on two federal agencies. The great bulk of the funding of our cultural institutions comes from private sources.
Individuals, business firms, and private foundations provide most of the money for the nation's museums, symphony orchestras, and theatre groups. These generous sums are in addition to the aid from states and localities. Comparisons of government aid to culture in the US with foreign government largess ignore the presence of a far more generous private sector here than abroad. Compared with the billions of dollars devoted to supporting cultural institutions, the National Endowments for the Arts and the Humanities together spent only $355 million in fiscal year 1994 - less than the revenues of US symphony orchestras alone.
What accounts for the cries of anguish about the prospective elimination of these modest sums? Many people fall into the trap of assuming that every issue demands a response from the government. Although the two federal foundations provide only a modest share of national cultural support, they supposedly "validate" artistic proposals. In this view, the award of a small grant by the National Endowments for the Arts or the Humanities signals that the recipient is worthy of private support. This notion is especially insidious. No federal agency should act as the national gatekeeper, judging which artists and cultural institutions deserve public and private support.
To counter in advance the charge that I am just a bean-counting Philistine, I note that my wife and I voluntarily support many community cultural institutions - including the art museum, the history museum, the sculpture park, the orchestra, and many others. The fundamental response over how to generate adequate support of the arts in the US is to strengthen the capability and willingness of the main supporter - the private sector. An expanding economy does generate more spendable income. Many government activities - ranging from the administration of justice to investing in infrastructure - contribute to a growing economy. Nevertheless, reducing deficit financing means more money in the private sector.
Yet each interest group defends the appropriations for its interest as a necessary investment in the nation's future. Sensible public policy requires balancing a number of important objectives - and often in complex ways.
The debate on tax reform is a good example of how these "indirect" issues affect cultural funding. Changes in the tax system that encourage saving and investment over consumption generate faster economic growth and more income for taxpayers. It is not obvious in advance whether discouraging consumption (including donations to cultural institutions) is offset by a larger per capita income. However, not all tax reform proposals are identical. Some (such as the USA Tax Plan) encourage private contributions to nonprofit institutions by keeping the traditional tax deduction for such outlays. Other reform proposals (such as the flat tax) do not. Those interested in the financial health of arts and culture might do well by becoming more knowledgeable about these supposedly noncultural economic issues.
Future levels of support of culture and the arts in the US will continue to be determined primarily by a host of supporters in the private sector.