By Grant Hall.  Founder of League Cultural Diplomacy

Follow @grantleehall

How should the arts industry counter misperceptions about arts funding?

For decades now, those working in the arts industry have been required to justify their activities in economic terms. This doesn’t usually sit comfortably with arts workers who know that the primary benefits of their activities to the broader society have nothing at all to do with money, but nonetheless continue to recite the economic arguments, which we by now know by heart, why the government should subsidise their activities.

Repeating the mantras, some old and some new, to uncultured folk who only know the value of something if a price tag is attached, and who only understand the arts in very narrow terms, is tiresome work that arts administrators must continually do, often at the expense of more worthy work.

Which takes me to Nick Mitsevich’s recent article for InDaily, Economic clichés ignore SA’s creative power. Mitsevich is the Director of the Art Gallery of South Australia and a well-paid public servant employed by the Government of South Australia (my home state). I’m sure he would prefer to be doing work directly related to building a great South Australian institution rather than writing articles justifying the arts industry’s existence in economic terms. One might think that the state of South Australia would benefit more from its expenditure of public funds with Mitsevich focusing on the core work of the Gallery rather than writing articles about economics, but the reality is that arts leaders are frequently compelled to write articles justifying the arts industry and its activities and it is proper that they do so.

There are two main reasons why arts leaders often feel compelled to write such articles: firstly, to counteract the lack of education that abounds in the community about both the economic and social benefits to the community of the arts industry, and secondly, to provide other arts administrators and supporters of the arts industry with sound arguments to help them when they are also required to stick up for the arts.

In pure business terms, ignorance of the economic and social benefits that the arts industry brings to the community represents a business threat to the industry, its organisations and their employees. South Australia, for example, has been in a state of economic stagnation for many years now, and with hospital emergency room waiting times and the daily commute into work growing steadily longer, people increasingly say things like “why is the art gallery spending half a million dollars of taxpayers money on an old painting when we need more hospital beds?”, an opinion that betrays a misunderstanding of the role of the arts in modern society. The more people talk in such an uninformed manner, the more such narrow-minded views make their way into the narrow-minded media and become accepted by narrow-minded politicians who prefer to make popular decisions than good ones, and who often have influence over the government’s purse strings upon which arts institutions are often and to various degrees reliant. In light of this, prudent management requires arts institutions to counter their identified business threats, and as such it’s necessary for their figureheads to invest their time countering these threats by delivering speeches and publishing articles.

Many of the contributions to the comments section of Mitsevich’s article highlight this lack of education in regards to the economic and social contributions that the arts make to South Australia. I found it ironic that an article with a heading that warns of the dangers of relying on ‘economic clichés’ to decry the provision of government arts subsidy was attacked by people relying on such clichés to make their point. Let’s look at some examples:

From “Chris”:

Always useful to hear economic advice from someone who receives 50% of their income direct from government grants. Anything else that Nick would like to express an unqualified opinion on? Brain surgery perhaps? What a joke.

Now I don’t really understand Chris’ logic, but it’s an argument that I’ve heard many times before so let’s try to follow it. What I’d like to know is at what point does a person who works for an organisation that receives government subsidy become “unqualified” to offer opinions or economic advice in the public arena? Is it at any level of subsidy, or when their income is made up of a certain percentage of government assistance, say 2% or 25% or 50%?

It’s a common and incorrect assumption that cultural organisations are the only businesses that receive financial assistance from the government, when in fact, governments in Australia provide billions of dollars in annual assistance to industries and individual businesses, including foreign owned corporations whose profits mostly go overseas.

Wealthy overseas car manufacturers with operations in Australia were given $12 billion in government subsidies over the last twenty years but are closing down anyway, and the fuel subsidies provided to overseas mining companies operating in Australia are simply enormous. On a much smaller scale, whilst setting up my consultancy and event management business, I attended numerous business courses and received expert business advice from a highly regarded consultant, none of which I paid for.  I know that the cost to the taxpayer for this government assistance was between $200 and $400 an hour. I also attended a government organised overseas trade mission, and whilst most delegates paid their own expenses to get there and back and for their accommodation, a considerable amount of food, booze and entertainment was provided, all of which was courtesy of the tax payer who, like it or not, were helping us to put forward a professional image to attract international clients, an investment that will deliver returns to the state well in advance of the investment.

So far, I’m finding it easier to get financial government assistance for my business than I ever did for the arts organisations I worked for, and I didn’t have to submit applications to receive the assistance that I’ve received for my business, all of which was simply handed to me on a platter and is easily justified.

Have I yet reached the level of government financial assistance that Chris suggests renders me unqualified to express an opinion? Following Chris’ logic, the CEOs of companies such as Rio Tinto, General Motors and Ford should also keep their mouths shut as they are recipients of what is often referred to as ‘corporate welfare’.

“But!” the Chris’ of the world might argue “governments assist businesses because businesses provide jobs, stimulate the economy and the government gets a return on their investments”.  Whilst this argument is true for business, it is also true for the arts. Government funding for the arts is an investment that pays dividends, both economically and socially.

The government financially assisted in the development of my business because it figures that eventually I’ll undertake activities that will help stimulate the economy and bring benefits back to the state. With the addition of social benefits, these are the same considerations that governments make when deciding which arts organisations to fund and to what degree, however some people seem to think that the benefits obtained by government investments in business are somehow more worthy or “real” than those obtained by government investments in the arts. All of which leads me to another group of clichéd arguments, this time made by “Adelagado”

Without endless Government handouts how many people will be employed by the ‘arts industry’? Its (sic) not real work, its public money being used to fund someone’s hobby.

This ignorant statement is a perfect example of incorrect and clichéd arguments against government funding of the arts. There are no “endless Government handouts” to the arts industry; any arts administrator or government budget papers will tell you exactly how limited government funding for the arts actually is.

Most arts organisations are run on a shoe-string budget and none are rolling in cash. Wages are also very low in the arts industry, particularly when compared to those found in other businesses that receive government financial assistance such as those in the mining industry. If one is to argue that arts jobs aren’t “real” jobs because they are partly funded by government subsidy it would be equally correct to say that workers on the Holden production lines aren’t doing “real work” because of the assistance that Holden, a subsidiary of General Motors, receives; try making that argument in the lunch room at Holden!

To say that the work of artists and arts administrators is just “someone’s hobby” is both ignorant and insulting and yet another cliché; most arts workers have studied their craft for years in a similar way to successful people in other professions. Artists have often gone to university or undertaken an apprenticeship and studied for years before entering the professional world.

Here’s another unhelpful cliché echoed by “Mick”:

 does the Jam Factory (a South Australian arts organisation) actually make a profit? NO. Propped up by taxpayers.

The argument here is that unless an arts organisation can “make a profit” it is useless and a drain on the community. Regardless of Mick’s misunderstanding of both the brilliance of the Jam Factory and its role, he fails to appreciate the social benefits of arts organisations and the wider economic benefits that aren’t reflected in the profit and loss statements of individual arts organisations. A report commissioned by Festivals Adelaide (a collaboration of the city’s ten major Arts Festivals) showed that in the 2013/14 financial year that the festivals generated:

• 54,300 visitors to the state
• An estimated 280,700 visitor nights
• A total turnover or gross expenditure in the SA economy of around $183 million
• The creation of 740 full time equivalent jobs (or approximately 7,800 casual staff employed during the running of each respective festival)

Perhaps most tellingly, the report showed that the festivals generated $4 of new income (into the state) for every $1 invested by the state government. Now none of the profit and loss statements of any of those festivals would show anything close to an income four times that of expenditure,  but that is the benefit that the community obtains from the festivals, some of which mightn’t “make a profit” without government subsidy.

A portion of the income generated by the festivals makes its way into state coffers, from which better schools, roads and hospitals can be built. Likewise, people come to Adelaide to visit our arts institutions like The Jam Factory, but their annual reports won’t contain details on how much cash their visitors have spent whilst visiting SA, although some larger arts organisations like the Adelaide Festival Centre have commissioned such studies.

Here’s some sarcastic wisdom courtesy of “James Irons”

I’m sure those about to me (sic) made redundant from Holden will be thrilled about being redeployed as dot painters and baristas.

Holden received enourmous handouts from the government and yet their workers are being made redundant. Work is work, and despite the sarcasm dripping from James’s comment, if there’s money to be made from dot painting, the unemployed and newly redundant might see things a little differently to him if jobs in the cultural and services industries are outlasting those in manufacturing, as appears to be the case. There is a deeper and more profound flaw in James’s comment that devalues the very workers he wants to protect from a terrible fate in the arts industry. Many years ago I managed the StrungOut Music Studios at Seacliff where I had two large rehearsal rooms used by local bands to rehearse each evening. Many of the musicians in those bands had day jobs on the production line at Mitsubishi before it closed down. For many of them, playing in a band was their reason for living and working,  Mitsu’s was just a way to earn some cash so that they could follow their artistic pursuits and dreams of rock ‘n roll glory. At the time, and little has changed since, there was very limited government support for promising bands and musicians performing original contemporary music. As the government has learned through its investments in festivals, a modest investment in the arts can bring outstanding returns. Even if investments in rock bands generated $2 for every $1 spent, it is still a strong return. Many talented artists of all genres, from painters to songwriters and writers work at Holden, and would absolutely love to be pursuing their passions which could, if the right pathways are created and investments are made, turn redundant machine operators into successful artists who earn big bucks which in turn benefits all of us. I’ve known many very talented artists who never quite “made it” as professional musicians who certainly could’ve “made it” if only they could’ve accessed some sort of financial support like that so readily available to ‘real businesses’.

What many people fail to comprehend is the economic spin-off effects of an arts activity like a performance or an exhibition generates. When even a moderately successful local musician performs a gig, jobs are created and money is made in a diverse range of fields; sound engineers need to be hired, trucks need to deliver the equipment, rehearsal rooms need to be booked, more beer needs to be stocked at the venue, marketers and PR people are put to the wheel, posters are printed, radio interviews are recorded and on and on it goes. If the musician is popular enough that people will travel to see them perform, a whole new level of economic generation occurs as hotels employ their full complement of staff to accommodate the rise in guests, bars and restaurants put on more staff, more taxi drivers are required and on and on the benefits accumulate.

A recent report from the Arts Council of England shows that ‘the average contribution workers in performing arts roles add to the economy’ there is £105,700 (Au$230,000) which is well in advance of the average salary of those workers. It would be good to know the same statistic for Australia, but for all the stats I’ve waded through over the last couple of days, this is one I haven’t seen. Study upon study completed all over the globe continue to prove the arts industry as a whole does more than pay for itself and delivers outstanding social benefits, but still, arts organisations need to answer inane questions like “how does your organisation contribute to the broader economy?” in funding applications!

What South Australia’s arts haters fail to understand is that even if they never read a book, go to the theatre or enjoy an arts exhibition or rock show, they are still the beneficiaries of these events that aid the local economy, build growth and create jobs, in turn making a civilised and healthy society. Don’t they realise that a vibrant arts sector is crucial for attracting investment into the state and reversing the brain drain? Their uninformed talk is not only potentially damaging to the arts industry, but also to the broader economy and social environment. Politicians should be the first to stand up for the arts industry, but they rarely are. Our leaders of tomorrow will benefit by being cultured people educated in the importance of the arts.

How can we stop these incorrect clichés making their way into public debates and wasting the scant resources of our arts organisations?

On this my mind is divided by two flawed options. On one hand, I would love to see the arts industry collectively stand up and altogether refuse to continue to engage with uneducated people or organisations who continue to seek to justify the activities of the arts industry in purely economic terms (as Australian conductor Richard Gill quotes his mother as saying in his biography ‘arguing with a fool shows there’s two’). Conversely, I see the value of the arts industry placing an even greater emphasis on undertaking further research just to make the ignorant critics shut up once and for all.

In reality, the problem with the first option is that by taking this position the industry would be likely to suffer from further funding cuts, whilst the second option of investing in even more research to tell us what we already know reduces the available resources that arts companies can deploy to actually produce artistic content.

The arts industry, its supporters and our political leaders certainly need to make sure our economic truths are heard above the incorrect economic clichés that seem to bounce freely about the place. But how? Perhaps there’s a new way forward altogether. I’d love to hear your suggestions.

For more posts about the value of the arts click here.

Disclosure: Grant Hall studies art history at the Art Gallery of South Australia.