The Arts Need a Bailout, Too

(Bloomberg Opinion) -- The U.K. recently announced a $2 billion bailout of its arts sector. Motivated by a desire to preserve its cultural heritage, support small businesses and help the tourism industry, the money will go to theaters, museums and concert venues.

The plan raises the question of what kind of aid the U.S. should consider, beyond that already available to small businesses more generally. After all, even if there is a vaccine soon, it is not obvious when consumers will feel comfortable going to jazz concerts again. Furthermore, tourism may be slow to resume, which damages many of the arts all the more.

The best fix here consists of two parts.

First, the federal government should proceed with plans to offer significant aid to state and local governments. That package should be modified, however, to devote more money to regions where the arts are crucial. That would include New York City most of all, which remains America’s arts capital and No. 1 cultural tourist draw. Also on the list might be Chicago, Los Angeles, Nashville, Austin and Santa Fe, among other significant cultural centers.

The recipients of these funds would be decided by state and local governments, typically through their arts agencies. There is already precedent for this approach, as 40% of the Cares Act money funneled through the National Endowment for the Arts went to state and regional arts agencies. In essence, each locale would have to do a kind of triage, deciding which institutions to support and which to neglect.

Ideally, federalism would produce some innovative approaches. Some theater and concert venues may want to re-create themselves in outdoor form, perhaps under tents with appropriate spacing. Museums and movie theaters might decide to invest in better ventilation systems, while arts schools might choose to use the money to regularly test their students for Covid-19. The only requirement should be that these funds go to arts institutions.

The second element of the arts rescue plan would take a different tack. Rather than giving money to arts institutions, the federal government could set aside some amount for a concept known as arts vouchers, originally developed by the British economist Alan Peacock.

Arts vouchers are similar to education vouchers except that they cover the arts. The government would hand them out to each American and allow state and local governments to specify which institutions and individuals would be eligible to receive such vouchers as payment. Unlike direct grants to arts institutions, arts vouchers give consumers a big say in where aid goes. They could be more popular with voters, because they give each one a direct benefit — namely, cash in pocket (yes, they would have to spend it on the arts, but it’s still cash).