• A Federal court has overturned the FCC’s “net neutrality” regulations, which have required internet service providers to treat all content equally. Legal details here; implications for artists and ways to get involved here. Meanwhile, AT&T has announced a plan to exempt selected content from wireless data caps; artists are expressing concern.
• How many foundations does it take to keep Detroit’s art in Detroit? Nine and counting: the ad-hoc alliance of funders has pledged to give $330m to reduce the city’s unfunded pension liability if the city’s creditors will agree to allow the Detroit Institute of Art to become a separate non-profit with its collection intact. In a nod to its origins, the Ford Foundation is the largest single contributor. It’s unclear whether this will fly with the creditors, so additional donors are being sought. (This could be part of an alarming trend: the Annenberg Foundation recently had to spend more than $500k to return sacred Hopi artifacts home.)
• Thinking of applying for nonprofit status? You may need to brace yourself for a longer wait time than usual. The recent federal budget agreement gives the IRS $526 million less than last year and mandates the agency spend more time reporting to Congress.

MUSICAL CHAIRS

• With Bill de Blasio having taken office, speculation builds around the next NYC Commissioner for Cultural Affairs, with names such as actress Cynthia Nixon, former Alliance for the Arts head Randy Bourscheidt, and Tom Finklepearl being floated as potential candidates to run what may be the nation’s largest arts funder. Meanwhile, Michael Kaiser praises outgoing Commissioner Kate Levin – and says we need her at the NEA.
• Karen Hanan, Executive Director of Arts Northwest, is transitioning to lead the Washington State Arts Commission effective March 1.

ALL ABOUT THE BENJAMINS

• How are arts organizations handling ongoing, recession-related budget pressure? Some are experimenting with curtain times, guerilla art, and other innovations; others are embracing an organizational cultural of abundance. Still others ask, “what budget pressure?”
• On the heels of the NEA’s decision to support collective impact projects for arts education, Ken Thompson of the Bill and Melinda Gates Foundation observes that despite the flurry of interest from funders, they display an overall “lack of certainty about what collective impact is” and for the most part remain focused on the programmatic rather than systems level. One source of the problem? For all of funders’ efforts to get grantees to collaborate, they aren’t doing much of it themselves.

IN THE FIELD

• After winning hearts and minds across the nation with its making-it-big-in-Idaho story, come this July, the Trey McIntyre Project will disband as a dance company, focusing instead on “other enterprises involving dance, film production, and photography.” Despite TMP’s throwing in the towel, Sydney Skybetter sees a triumph and not a failure.
• In other dance news, choreographer Gina Gibney’s company will take over the former home of Dance New Amsterdam in downtown Manhattan, preserving the space as a hub for dancers from commercial and non-profit companies at a time when space is scarce.
• After a three year lockout (and, as we reported a few weeks ago, an attempt to form their own nonprofit), musicians from the Minnesota Orchestra will return to their orchestra hall next month thanks to a contract settlement that cuts their pay and benefits by roughly 15 percent.
• A painting by Glenn Brown replicating the cover of Isaac Asimov’s sci-fi novel “The Stars Like Dust” has sold for almost $6 million, causing many techies to suddenly find themselves in the unfamiliar position of advocating for copyright enforcement.
• Nonprofit theater makes way for film and television: Atlanta’s Woodruff Art Center has sold its three-stage 14th Street Playhouse to the Savannah College of Art and Design, which will use the space to house TV and film degree programs. Woodruff, in turn, donated $1.9 million of sale proceeds to the Community Foundation of Greater Atlanta to establish a new grant fund to support local performing arts organizations.

BIG IDEAS

• We nearly missed this end-of-year roundup of “10 trends and 10 predictions” for the nonprofit sector from NonProfit Quarterly. You’ll recognize several of the items, like the emerging national security state and general government incompetence, from our list of the top 10 arts policy stories, but NPQ adds several others to the table (including an emerging progressive agenda at the local government level) and gives arts organizations a special shout-out – for their “struggl[ing]…business models.” Woohoo.
• Over at Barry’s Blog, social media guru and recent Arts Dinner-Vention participant Devon Smith delves into the potential roles of user experience designers, Google glass, and 3D printers in arts organizations, and offers some insights on the need for think tanks (including ours) in the arts.

RESEARCH CORNER

• The National Endowment for the Arts has posted a batch of working papers and reports resulting from the inaugural year of its Research: Art Works program. There’s a range of goodies to dig into, including a study of the racial and ethnic composition of arts boards, and another look at the arts as a driver of economic growth.
• The Brooklyn Commune Project is out with a new report “on the state of the performing arts from the perspective of artists.” Researched and written by volunteers, it includes an impressive and cogent summary of the economic challenges performing artists face, and thoughtful recommendations for the sector. At 50+ pages it’s not a short read, but a worthwhile one. (More from Andy Horwitz here.)
  
• Another report from the UK examines how artists can support the development of socially responsible, sustainable economies, and identifies three “vital practices” that allow them to do so: 1) critical reflection around how artists maintain their livelihoods, 2) opportunities for artists to “pool their risk” when embarking on new endeavors, and 3) opportunities for artists to access unused spaces in urban environments.
• Amid increased calls for states to track student access to arts education comes this welcome reminder that determining access is more complicated than counting which schools offer which courses.
• In the latest distant-reading study, analysts have crunched “various linguistic characteristics” of a slew of old books against their commercial and critical success, then applied the resulting algorithms to contemporary writers to find that Dan Brown, William Faulkner, and Philip Roth aren’t very successful. Points for counter-intuitive results, at least.

The Thinker at the Detroit Institute of Arts – photo by Quick fix

Each year, Createquity offers a list of the top ten arts policy stories of the past twelve months. You can read the previous editions here: 2012, 2011, 2010, and 2009. The list, like the blog, is focused on the United States, but is not oblivious to news from other parts of the world. I am grateful to Createquity editorial consultant Daniel Reid for contributing the entry on the arts and the GDP.

This year provided us with a mix of hope and stress. While boasting its share of concrete triumphs and failures, such as the launch of several field-building initiatives and the very high-profile flaming out of the venerable New York City Opera, 2013 was most notable for providing us with markers along the path of longer-term trends. With the struggles of the Great Recession largely behind us, arts stakeholders increasingly turned their attention to non-financial matters, planning for the future and seeking to invest wisely. Yet the specter of fear and dysfunction in Washington, DC hung over the arts field to a degree not seen since at least the Bush years, sapping enthusiasm from even the most passionate of government idealists.

10. Changing of the guard at ArtPlace

As noted in last year’s top stories roundup, creative placemaking was cruising for a bruising in 2012. While a number of factors contributed to the backlash against the signature arts policy push of Rocco Landesman’s tenure as NEA Chairman, by many accounts, the brusque style of ArtPlace’s founding director Carol Coletta didn’t help. Under her leadership, ArtPlace – a private-sector collaboration between 13 of the nation’s largest arts funders initiated by Landesman and the Ford Foundation’s Darren Walker – came under fire for failing to disclose its funders’ geographic restrictions, missing opportunities to thoughtfully measure creative placemaking’s impact, being cavalier about gentrification and other social justice considerations, and supporting a project that alienated the people it was trying to help. In the midst of all this, Coletta decamped for a VP position at the Knight Foundation in March. Her eventual replacement announced in December, following an interim stint by former William Penn Foundation president Jeremy Nowak, was the NEA’s Chief of Staff Jamie Bennett, who had ingratiated himself with arts stakeholders across the country in his now-former position and earned widespread admiration in the process. Change is in the air at ArtPlace (the organization is moving with Bennett to New York, for one), and many eyes are watching the fledgling creative placemaking standard-bearer as we head into 2014.

9. City Opera bids farewell

Amidst near-death experiences far and wide, New York City Opera is the biggest and most famous U.S. arts institution yet to actually fail as a result of the Great Recession. The once-mighty company, which had visions of a $60 million annual budget as recently as 2008, had drastically scaled down its ambitions following a disastrous season during which it presented no full productions, lost its (brand new) general director, and managed to draw down or lose the majority of its endowment. By the time George Steel took over in 2009, most of the damage had been done, and City Opera could no longer afford its just-renovated home at Lincoln Center. A last-ditch effort to raise $7 million (including a first-of-its-kind-at-this-scale “save the opera” $1 million Kickstarter campaign) fell short, and the organization announced it was beginning bankruptcy proceedings in October.

8. Arts’ impact on GDP gets counted

Advocates at Americans for the Arts, the NEA, and elsewhere have spent years touting the arts’ economic impact, on the theory that legislators and executives will find this argument singularly compelling and respond by taking their fingers off the “defund” button. This year, their case got official recognition from the Bureau of Economic Analysis (BEA), which calculates GDP. First, in July, the BEA revised its methodology for calculating GDP to include the money businesses spend to develop intellectual property, including artistic work like music and film; this added 3% to our nation’s economy overnight and underlined the economic importance of investment in creative work. Then, in December, the BEA and the NEA jointly released the first-ever official tally of the value the arts add to the U.S. economy, which they will continue to track annually (note that this does not yet take into account the methodological changes announced in July). The total – $500 billion a year, more than the entire tourism sector – impressed some mainstream news outlets and was promptly put through the spin cycle by a few creative-industry advocates, especially in Hollywood. But the bigger surprise was how little excitement the story seemed to generate in arts circles – perhaps because of the report’s bad news about the arts’ post-recession recovery, the fact that commercial fields accounted for the bulk of the value, or the omission of ancillary spending (such as on dinner before the theater) that often figures prominently in more localized economic impact studies.

7. The arts (start to) get serious about diversity

Yeah, yeah, I know. Talk is cheap, and our field has been dithering about multiculturalism, demographic change, and the need to diversify boards, staffs, and audiences for decades. Looking beneath the surface of the blogosphere debates, however, one does get the sense that momentum for action is growing. 2013 was the year of the inaugural SphinxCon, a convening on (racial) diversity in the performing arts spearheaded by a man who was almost the next Chairman of the NEA (more on that below), and the leaders of numerous relevant service organizations showed up to put their views on the record. One of those service organizations, Theatre Communications Group, is now a year into an extensive and very public “diversity and inclusion” initiative and the conversation is bubbling up at other service organizations as well now that financial survival is no longer everyone’s first priority. Meanwhile, Grantmakers in the Arts had its entire board undergo training by the People’s Institute of Survival and Beyond, a leading purveyor of anti-racist thought. These are small steps in the grand scheme of things, and diversity is not the same as justice, but one can’t help but be encouraged watching the organizations charged with leading the field begin to walk and not just talk.

6. The arts research field makes halting progress toward field-building

Last year, I got so frustrated with the state of arts research that I blathered on for more than an hour to the University of Chicago Cultural Policy Center about all of its problems and how to fix them. Fortunately, it turns out that I’m not alone in seeing the need and opportunity for reform of our field’s research infrastructure. The first and easiest step toward a better future was always going to be a way for people working in this area to communicate more effectively with each other, and May’s launch of the Cultural Research Network goes a long way toward checking that box. This was also the year that the arts began to flirt in a big way with Big Data. We saw the launch of two immense arts data aggregation initiatives, Philadelphia’s CultureBlocks (building off of the work of Social Impact of the Arts Project researchers Mark Stern and Susan Seifert) and Southern Methodist University’s National Center for Arts Research (aggregating data from the Cultural Data Project, TRG Arts, and elsewhere). A third project, the Harvard-led Initiative for Sustainable Arts in America, is set to launch in Detroit and the Bay Area in 2014. Meanwhile, the aforementioned Cultural Data Project is taking a look in the mirror with a gigantic, year-long strategic planning process that looks like it will result in major changes for the organization and the field. We’ve got a long, long way to go, but the progress we saw in 2013 toward a smarter, more tech-savvy, and more collaborative knowledge management infrastructure in the arts is highly encouraging.

5. The NEA remains Chairless

When Rocco Landesman left his post as chairman of the National Endowment for the Arts in December 2012, there was no reason to think that the leadership transition would be anything but smooth. Senior deputy Joan Shigekawa, who had long been rumored to be the one running the agency behind the scenes anyway, became the acting head, and a search for a new director began immediately. Yet as the year dragged on, the process became murkier, and at this point no one seems to be sure when the Obama administration (which is in charge of the search) might get around to formally nominating a new leader. Sphinx Organization founder and National Council on the Arts member Aaron Dworkin is the only individual to have publicly confirmed being a candidate for the gig and was widely seen as the frontrunner for the post until he pulled his name from consideration over the summer; he would have been the Endowment’s first black chairman. NEA fans can take heart at least in the fact that they are not alone; the National Endowment for the Humanities has likewise been without an official leader since May.

4. A roller coaster year for the DIA

My goodness, where to begin? The Detroit Institute of Arts has had more ink spilled on it in the last two years, it seems, than Brad Pitt and Angelina Jolie. It was just last August that the DIA was triumphantly celebrating the passage of a millage, or property tax, in three counties providing the institution with ten years of guaranteed operating support, allowing it to build its endowment and place itself on secure footing for the future. But then in July the City of Detroit announced that it was filing for bankruptcy, placing the DIA’s art collection – much of which is owned by the city – in jeopardy. The city’s state-appointed emergency manager, Kevyn Orr, has reportedly asked the DIA to come up with $500 million to help appease creditors and lead Detroit out of the doldrums, which is about how much the auction house Christie’s has assigned to the value of artworks purchased with city funds. The most interesting potential outcome has the city and the DIA entering into a “grand bargain” involving an effort to raise the $500 million from a consortium of local and national funders, including the Kresge and Ford Foundations, and turn the DIA into a private entity, free from city control. Regardless of how this one turns out, it’s an object lesson in the potential pitfalls of direct government involvement in arts institutions.

3. Edward Snowden shows us we’re not as free as we thought

A 30-year-old former government contractor running off with four laptops and goodness knows how many hard drives’ worth of secret intelligence documents made for a compelling news story, but its connection to the arts wasn’t immediately clear. After all, the initial disclosure – that the United States National Security Agency was working with phone companies to collect metadata (information about calls, though not the calls themselves) en masse – seemed like it might be No Big Deal. It’s helpful for our national security apparatus not to have to wait for days to know who’s called whom, they still have to get a warrant to figure out what was actually said, and it’s all cleared by the Congress and our courts. Right? But as more and more revelations from Snowden’s treasure trove have come to light, the creepier this whole thing has gotten, and the more it’s become apparent that virtually nothing we do online is secret from the government. The NSA has intercepted the fiber-optic cables that carry Internet traffic to collect information on activities without the Internet companies even knowing; the agency “repeatedly broke surveillance rules,” and there have already been cases of “willful misconduct” like stalking love interests. Here’s what’s important to keep in mind from an arts perspective: the United States has always prided itself as a country of free expression. One of the most important ways in which that freedom of expression has been possible is that the government has intentionally held back from giving itself the means to control it, letting social norms and the marketplace have influence instead. There may be little reason to think that Uncle Sam would be interested in some random artist’s work today, but imagine a change in administration, another war, and a widespread movement for social change in which artists play a big role, and all of the sudden 2013 might start to look a lot like 1983.

2. Obamacare gets off to a rocky start

For years, advocating for health care reform was a major priority of a number of arts organizations. Once the Patient Protection and Affordable Care Act was passed, several of those organizations (including the one that I work for) took the opportunity to declare victory and go home. Pretty much no one considers Obamacare to be perfect, but the legislation had been widely praised and its rollout highly anticipated in arts circles because of its promise to better serve freelancers, particularly those with modest incomes (due to the subsidy provided). However, when healthcare.gov couldn’t process enrollments to save its life upon its October launch, it all started to look very, very fragile – particularly the already popularity-challenged individual mandate that is, according to economists, the linchpin to the entire system. It looks like the worst fears about Obamacare’s shaky launch have passed, but not before a small business exchange and the employer mandate were delayed for a year and other concessions were made to mollify angry citizens, many of which are arguably bad policy. Make no mistake, the Affordable Care Act is here to stay – but how much it’ll actually end up improving things is perhaps a bit more in question than it seemed a few months ago.

1. Wait, who elected these guys?

When the dust from the 2012 election cleared and Barack Obama was still president, the Senate was still Democratic, and the House was still Republican, we knew we were in for another two years (and most likely four) of divided government. But I don’t think too many people expected it would get this bad. The hyper-partisan environment, political infighting between conservative and establishment Republicans, petty power struggles between branches of government, and the determination to treat even the smallest difference of opinion as a virtual fight to the death all contributed to one of the least productive Congressional years in recorded history and a 16-day government shutdown that earned the ridicule of the world. As much as this sucked for all of us as citizens, it all but put the kibosh on any dreams of transformative arts policy coming from the Obama administration. With so many urgent national priorities getting in line to be ignored or gamed by a Congress that is far more adept at drafting press releases than passing legislation, maintaining the status quo is about the best that arts advocates can hope for in 2014.

Honorable mention:

• Scandal at the IRS
• Darren Walker lands Ford Foundation’s top gig
• The sequester hits federal arts agencies

Happy 2014 to all!

On to the news:

YOU’RE FIRED

• The orchestra world has been shaken to the core this month. The largest institution yet to face such troubles, the Philadelphia Orchestra, has filed for bankruptcy (the restructuring kind, not the “we’re throwing in the towel” kind). On the one hand, I am sure that the Fabulous Philadelphians’ financial troubles are very real. On the other, it does strike me as curious not only that (as others have noted) an organization with a $140 million endowment would file for bankruptcy, but that the move precedes the announcement of a $160 million fundraising campaign to save the orchestra. Andrew Taylor digs into the bankruptcy filing docs.
• The Syracuse (NY) Symphony Orchestra has filed for Chapter 7 (we’re throwing in the towel) bankruptcy, after canceling the rest of its season a week earlier. Looks like it’s lights out for this one, not to mention the SSO’s 95 musicians and staff.
• Albuquerque’s New Mexico Symphony has filed for Chapter 7 as well. 80 musicians and staffers will lose their jobs.
• On the plus side, the Detroit Symphony musicians are back to work, albeit six months later. The new three-year contract calls for 25% cuts in salaries (to $79,000 base pay, hardly slave wages) and additional funds available for optional community-service work. The orchestra’s size will be reduced from 96 to 85 musicians.
• The artistically successful but financially troubled Intiman Theatre  in Seattle has cancelled the rest of its season due to money problems. Its artistic director, Kate Whoriskey, has now left as well.
• The Baltimore Shakespeare Festival is kaput after 17 years in operation, making it the second major Baltimore arts organization to fold since the start of the Great Recession (after the Baltimore Opera). The article contains this quote that would make Tyler Cowen smile: “‘We started as a non-Equity company, and if we had dropped our contract, it would have cut our costs,’ Toran said. ‘But that’s exactly what we weren’t going to do. You want to pay your actors, just like you pay lawyers and doctors and teachers. Our goal wasn’t survival at any cost.'” So because they wanted to pay the actors so badly, they decided to give them fewer work opportunities?
• The New York City Opera, two years after spending the 2008-09 season inactive and raiding most of its endowment to stay alive, is facing a possible strike and the delay of its season announcement for next year.
• Pittsburgh arts groups are exploring increased collaboration as a survival strategy.
• Meant to write about this a while ago, but Pepsi Refresh has relaunched with a different process and set of rules after complaints of gaming the system last year.

I QUIT

• Ellen Rudolf is stepping down as longtime director of the Surdna Foundation’s Thriving Cultures Program, which she had initiated with the foundation 17 years ago.
• Jeremy Nowak, a noted advocate for the power of the arts in revitalizing communities, will no longer be the President and CEO of The Reinvestment Fund – for good reason: he’s about to become the new head of the William Penn Foundation. (via GIA News)
• Nina Simon, author, blogger, and museum design consultant extraordinaire, is quitting her consulting and speaking business to be the new Executive Director of the Museum of Art & History at McPherson Center in Santa Cruz, CA. Thankfully, she is not quitting her blog.

SHOW ME THE MONEY

• Whoa…a donor’s estate in Bermuda is withdrawing an £82 million donation to Switzerland’s Lucerne Festival for no reason at all, apparently.
• Chad Bauman riffs on the recent cuts to DC’s Arts and Cultural Affairs Commission from a marketer’s perspective.
• Michael Kaiser takes a dim view of the trends in corporate giving to the arts. Here are some numbers from the Foundation Center.
• Americans Gave a Lot Less in the Recession Than Experts Predicted, reads the Chronicle of Philanthropy headline. Among other things, this story is a pretty big black eye for Giving USA, the annual report on individual giving that had estimated that donor activity was holding steady or barely dropping during the same period.
• Meanwhile, foundations gave (slightly) less in 2010 than 2009, despite the fact that their assets increased by 5%.
• Why don’t more foundations publicly explain the rationale behind their gifts?
• It looks like the growth of new 501(c)(3)s has finally slowed (and the numbers will actually drop considerably once the IRS releases the names of the nonprofits whose status it has revoked as a result of nonfiling). Of course, this hasn’t stopped composer Philip Glass from founding a new festival in Carmel Valley, CA.

SHOW ME THE BIRTH CERTIFICATE

• My colleagues at Fractured Atlas have a new publication laying out what the health insurance reform law means for artists.
• A new publication from the Boekman Foundation in Amsterdam: Cultural Policy Update. And check out this fab cultural policy blog salon put together by my friends at Emerging Arts Professionals – San Francisco Bay Area, featuring an admirably diverse range of voices.
• Not surprisingly, the social media cognoscenti are all abuzz about the new report from the Knight Foundation, “Connected Citizens: The Power, Peril, and Potential of Networks.” Beth Kanter is all over it here.
• CEOs for Cities reports on the residential clustering patterns of the “young and the restless” – college educated 25-34-year-olds. Seems cities’ “close-in neighborhoods” are more important than ever.
• Partners for Livable Communities reports on strategies for arts organization outreach to senior and immigrant audiences.
• Shannon Litzenberger is back with a massive report on cultural policy in the Windy City.
• Won’t you help Devon with her epic Facebook experiment? (It begins tomorrow.)

SEE YOU IN COURT

• David Byrne has come to a settlement with former Florida Governor Charlie Crist, who had used the Talking Heads song “Road to Nowhere” without permission during Crist’s unsuccessful campaign for Senate last year. (Seems a rather auspicious choice, no?) The settlement terms apparently included Charlie recording this apology video, which actually almost makes me feel sorry for him.
• Matthew Guerrieri reports on a dispute between the Music Publishers Association (UK) and the International Music Score Library Project.

BEAUTY CONTESTS

• Bubble sort as demonstrated by Hungarian folk dance.
• Eric Whitacre is back with the Virtual Choir 2.0, this time performing his “Sleep” and featuring over 2000 performers. Sounds great, but fair warning: the video is even cheesier than in the last one.
• To draw in new audiences, an orchestra plays for cows.
• I find a lot of public art less than inspiring, but I have to admit, this is pretty awesome:
  

  After more than a decade of disagreement, Berliners have settled on a monument to celebrate German reunification and the 1989 peaceful revolution: a giant, rocking dish.

  The 55-metre, 330-tonne glittering steel wing can hold up to 1,400 people at any one time, but it needs at least 20 people to get it moving.

  The monument to unity is called Citizens in Motion, and is apparently all about people coming together. If you want to make it move, you have to get a group together and all go in a particular direction.

In 2002, after almost a decade of precarious under-the-radar loft living — Watson cites the time her leg went through the floor, as well as the drawbacks of sharing space with a peanut roaster — she found six partners, scraped together $170,000 and bought a 66,000-square-foot factory once used to make Venetian blinds, in the rough neighborhood behind the train station. The area has since been christened the Station North Arts and Entertainment District.

The partners now rent studios to something like 25 artists. And that still leaves room for Watson, who is 41, to store her 1948 Chevy truck in a gymnasium-size room where she and her artist-husband weld their sculptures.

[…]

All this mixing of bohemian and sober, of art and music and theater and film, suggests another possibility: that it’s the scene itself, in all its fascinating complexity, that is the true work of art in Baltimore. These days, the idea of counting “life” as “art” has the grand name of “relational aesthetics,” and it’s a bit of a Baltimore specialty. Last year’s Sondheim winner was a collective whose “works” included a community garden in east Baltimore, as well as a scruffy little pavilion outside the BMA that came with an open invitation for groups to hold events in it.

“I like to think that the definition of art is expansive enough that the community could exist as the artwork,” says Hileman.

Even more interesting to me, however, was Anne Midgette’s story on what appears to be a thriving menu of operatic offerings in Charm City. You might remember that the 58-year-old Baltimore Opera was among the first arts-related casualties of the Great Recession, and at the time there was much gnashing of teeth over how many more established institutions would bite the dust and how many cities would become artistic orphans as a result. Merely 18 months later, however, there are “at least seven opera companies, maybe more,” of which “more than half…started this season.”

They offer young local singers, nontraditional stagings and in some cases unusual repertory — such as the stripped-down adaptation of “Madame Butterfly” for prepared piano and electric gamelan orchestra that American Opera Theater will present on a double bill with Messiaen’s “Harawi” in 2010-11. And they are definitely playing to a new audience.

“The growth has been in unexpected areas,” says Tim Nelson, who founded American Opera Theater in 2002. “Twenty-five-to-40-year-olds; people from less affluent, less educated backgrounds.”

“We took a survey at our second-to-last show,” says Beth Stewart, a soprano who founded Chesapeake Concert Opera, which performs in a church in Bolton Hill. “Tons of people said, ‘We weren’t really into opera before. Now we are.’ “

As Midgette points out, most of the new companies are run on a shoestring, and their success to date is to some degree possible only because it’s so damn hard for singers to make it anywhere but Baltimore, ensuring that the local talent pool remains high-quality. Caveats aside, though, I think this is a good lesson to remember when we worry about the impact the recession may be having on specific organizations. Change is always difficult, and certainly is not always for the best. But in this case it appears that the void left by the dissolution of the Baltimore Opera was quickly filled by at least four new companies collectively boasting more innovative programming and performances with appeal to a more diverse audience than ever before. Which raises the question: was the existence of the Baltimore Opera actually standing in the way of that innovation the whole time?

It’s an important thought to consider as we ponder how to offer stewardship to the arts community as a whole. As scary and depressing as the recession can be, sometimes starting all over again is the right thing to do.

• Philanthropy News Digest highlights a few examples of non-profit newspaper models around the country.
• Cool story about Lower Manhattan arts organizations banding together to improve their joint situation, to the point of actually sharing audience and financial figures with each other. Well done, and hope it yields results.
• Leonard Jacobs (proprietor of the Clyde Fitch Report) responds to my rant from the other week. I must have made an impression on him, because he says he’s a loyal reader now. (Thanks!)
• Liz Lerman proposes a “job swap to save American capitalism” — have the artists run Wall Street.
• Great story about a new minority-led orchestra in DC aiming for a much more diverse audience than the usual classical music crowd, and from all appearances so far, succeeding.
• A propos of my Disney post from the other day, did you know that the economically optimal term of copyright is 14 years?
• Former New York City Cultural Affairs Commissioner and general arts bigwig Schyler Chapin passed away over the weekend.
• Andy Horwitz of Culturebot posts a manifesto of sorts on arts policy. It’s mainly very good stuff, though I have to disagree with this:
  

  No more M.F.A.s! There is nothing more useless than a Master’s degree in arts administration or an arts administrator who possesses one. Not only does the “book learning” rarely have anything to do with the real world, it creates a peculiar breed of person who feels entitled to respect (and a senior position) without possessing any prior actual experience. Cultural institutions don’t need more MBA-style administrators who are constantly looking for the next best opportunity. Cultural institutions need administrators who are hands-on and capable. More importantly, because of the extraordinarily ephemeral nature of arts + culture, the institutions need the knowledge management which comes from long-term employee retention.

Ignoring for a moment that he seems to conflate MFAs and MBAs (for a second I thought he was advocating getting rid of conservatory drama and painting programs, which is another matter entirely), I will say in defense of my education that I’ve learned a tremendous amount about the world in my two years here at the Yale School of Management, a perspective that would have been, if not impossible, at least very difficult to acquire if I had stayed inside the industry this whole time. I do agree that prior arts experience is something of a prerequisite for senior management jobs in the arts; on that he’ll get no argument from me.

• The New York Times has the inside story of how the $50 million shot in the arm for the NEA came to be saved last week. Apparently none other than Robert Redford got into the act, placing a well-timed phone call to Nancy Pelosi pleading the case. Louise Slaughter (D-NY), co-chair of the Congressional Arts Caucus, also gets big ups. Meanwhile, good ol’ Chuck Schumer, who voted for that ridiculous amendment prohibiting money in the package from going to a range of recipients including arts centers, zoos, and aquariums, admitted that “he had been unaware that the amendment ruled out money for museums and theaters.” (Incidentally, those zoos and aquariums didn’t fare so well — the language barring them from receiving any of the money is still in there. I guess the Bronx Zoo porcupine will still have to hit the unemployment rolls.)
• Not good enough, says Greg Sandow in the Wall St. Journal, wondering “if this is such a victory.” Greg’s op-ed has been getting a fair amount of attention, and I hope to write a fuller response this week if I have time.
• Meanwhile, The Nonprofiteer offered her own well-written take on public funding for the arts not too long ago. She argues that consumption of art, not the creation thereof, should be the focus of advocacy:
  

  In other words, brethren in the arts community: stop talking about public funding for the arts as if the point were for the public to support YOU. No one cares about you. What we care about as a society is US, and how exposure to what you do will improve us.

  And once you accept that, you have to accept another, equally painful truth, which is that no one can actually determine what’s “art” til at least 25 years after it’s been created. Probably the Nonprofiteer doesn’t need to remind you that people threw things at the stage the first time they saw and heard The Rite of Spring, now part of the musical canon. But what she probably does need to point out is that this doesn’t mean the public should accept and/or fund every objectionable thing it sees in hopes that it will ultimately turn out to be art. Rather, it means that support for creation is a mug’s game, a gamble at which most players lose, and that the public should instead put its money into presentation.

  This excerpt makes her post sound more hostile than it actually is, but I agree with the underlying points here. The arts do not suffer from a creation problem. Far more art, great art, is being created right now than can possibly find a supportive, sustaining audience through existing channels. The Nonprofiteer does not argue that art creation shouldn’t be supported at all, but rather that public support (as distinguished from private philanthropy) should focus on getting those creations to the eyes and ears of the masses. It’s not far off, in fact, from my own vision of an artistic marketplace, one in which the mechanisms of artistic curation and activity are sufficiently subsidized such that talented individual artists don’t need to win fellowships and grants in order to survive, they just need to win the respect of their peers and colleagues.

• Somehow I missed this the night of, but The Recording Academy’s president and CEO Neil Portnow pimped the Secretary for the Arts idea during the Grammy Awards broadcast.
  

  And to our new president, we have a request: Our finest national treasure is our culture and the arts. It’s also one of our most embraced and economically significant exports all around the world.

  So it’s time that we acknowledge that fact with the creation of a cabinet position of secretary of the arts to promote and develop this vital contribution to society everywhere.

• Obama is following through on his campaign promise to create an Office of Urban Affairs, and Bronx borough president Adolfo Carrión has been named its founding director. As a reminder, the Urban Affairs office has “support regional innovation clusters” as one of its prime directives.
• Speaking of urban affairs, Richard Florida has a LONG article in the Atlantic speculating on how the economic crisis will reshape American cities. A very interesting read.
• Giorgio Armani is donating $1 million to support art in the New York City public schools.
• Here’s an interesting experiment: artists selling shares of their work in order to fund its creation, with the interim value determined by a stock index-like metric based on the “social capital” the artist has accumulated. Donors and artists’ incentives are thus aligned in the direction of helping the work find an audience. I know a fair number of people who would gag at this kind of thing, but the b-school student in me is very intrigued.
• For any nonprofits out there who want a free website, this guy might build one for you if you apply in the next week.

But on Thursday, almost three years after stepping down as chairman of the Federal Reserve, a humbled Mr. Greenspan admitted that he had put too much faith in the self-correcting power of free markets and had failed to anticipate the self-destructive power of wanton mortgage lending.

“Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief,” he told the House Committee on Oversight and Government Reform.

…

“You had the authority to prevent irresponsible lending practices that led to the subprime mortgage crisis. You were advised to do so by many others,” said Representative Henry A. Waxman of California, chairman of the committee. “Do you feel that your ideology pushed you to make decisions that you wish you had not made?”

Mr. Greenspan conceded: “Yes, I’ve found a flaw. I don’t know how significant or permanent it is. But I’ve been very distressed by that fact.”

On a day that brought more bad news about rising home foreclosures and slumping employment, Mr. Greenspan refused to accept blame for the crisis but acknowledged that his belief in deregulation had been shaken.

Folks, when Alan Greenspan says there’s something wrong with free-market economics, it’s time for the entire field to take a look at itself in the mirror and ask WTF. As I’ve posted before, our introductory economics textbooks teach that any attempt to mess with the natural interaction of the markets leads to what’s called “deadweight loss,” essentially economic waste resulting from transaction partners who can no longer make trades because of interference from an outside party. This analysis rests upon the assumption that any nonregulated market will naturally, on its own, find a price equilibrium that works for the maximum number of people. That analysis rests upon an assumption that both producers and consumers are monolithically rational across the board, and furthermore, are smart enough to take advantage of arbitrage opportunities that would result from people not behaving rationally in the marketplace.

What we learn in behavioral economics, however, is that producers and consumers act irrationally all the time, and yet arbitrage doesn’t happen. Unlike neoclassical economics, behavioral economics is built upon actual observation of human behavior instead of theoretical models that may or may not have any basis in fact. In fact, traditional economists’ typical MO is to justify seeming anomalies after the fact by trying to find a rational explanation for them. Behavioral economics, by contrast, declines to take rationality as a given and instead looks to psychological research to identify any number of mental hiccups that human beings display on a consistent (though not universal) basis: optimism bias, confirmation bias, the endowment effect, loss aversion, hyperbolic discounting, just to name a few. The idea that such biases wouldn’t find their way into marketplace decisions on a large scale, thus undermining the very assumptions that form the foundation of the free-market philosophy, seems ludicrous to me–wishful thinking in itself, perhaps. And indeed, we looked at a number of examples of actual, functioning, competitive marketplaces in which price shrouding induced consumers to make suboptimal decisions all the time–and yet no self-correcting white knight came in to save the day. A study we read looked at brands of dishwashing detergent that held on to a niche of the market despite performing less effectively than their competitors. Or consider the puzzle of title insurance, an industry that carries what appears to be a 96% profit margin for insurance providers, yet persists due to widespread consumer adoption.

Any artist can tell you that human beings are complicated creatures, often prisoner to emotions and frequently acting in ways that could be characterized as not particularly intelligent. Cognitive science basically says the same thing. How long will it take economists to catch up?