Arts and The Economy

The country's economic situation has hit hard across many industries, from automotive to business -- and even the arts.

Michael M. Kaiser, president of the John F. Kennedy Center for the Performing Arts, will be online to answer your questions and comments on how the economic crisis is affecting the arts community in Washington and beyond.

Kaiser joined the Kennedy Center in 2001. Prior to that, he served as the executive director for the Royal Opera House and the American Ballet Theatre.

Check out our special feature on this topic: Arts and The Economy.

The transcript follows.

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Michael Kaiser: Good morning. It is good to be with you to discuss the challenges arts organizations face in the current economic climate. Thanks to all of you who have asked questions. I will get to as many as possible in this hour.

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Toronto, Canada: Are you finding common themes or concerns with the organizations requesting assistance through Arts in Crisis? What's the most urgent issue for everybody right now?

Michael Kaiser: We're working with about 350 organizations in crisis. Common issues include boards that are demanding cuts to programming without understanding the implications of these cuts, arts organizations that do not plan their programs enough in advance to find the resources required to mount them, and organizations not budgeting appropriately for this period of economic crisis.

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Baltimore, Md.: Doesn't the current economic downturn actually help the performing arts community in the long turn? Many of the groups that are closing their doors were poorly run, not sufficiently supported by the community and had bad business models and now that they are gone, funding, grants and tickets can go to more stable, successful organizations that can put this income to better use?

Michael Kaiser: While ia gree that the economic crisis has revealed some poorly managed organizations, I can't take heart in this. I am never happy when an arts organization that creates wonderful art, even if it is poorly run, goes away. My focus is on providing training to arts managers so that all arts organizations have stronger management and artists are better supported.

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Albuquerque, New Mexico: What are some ways I can motivate my board to fundraise?

Michael Kaiser: The best way to motivate a board is to get them excited about a specific project. I try to get each board member to adopt a project that they can work on -- this will encourage them to raise funds, get friend and associaes involved, etc.

Also, the more institutional marketing you do, the more likely board members are going to be excited about your organization and the more likely they are going to help you.

When baord members are embarrassed about the organization they tend not to involve their friends and associates -- so I work to get them excited and 'unembarrassed.'

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Virginia: As you stated organizations are making programmatic cuts but what about administrative cuts? What is your take on cutting back in this area?

Michael Kaiser: I believe that if one has to cut one's budget, than I prefer to cut administrative costs since they typically do not affect the attractiveness of the organization to ticket buyers or donors.

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Washington, D.C.: What are your suggestions on building visibility and market presence for a small arts organization that cannot afford a marketing budget?

Michael Kaiser: I focus on what is called institutional marketing, not paid advertising. Institutional marketing means working hard to make your organizaiton visible to potential audience members and donors. Do important programs, special events, perform at ciiv events, work to get the press interested, etc.

Also, use the internet to build a marketing profile. The Internet is our best friend and can reduce the cost of paid advertising.

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Philadelphia, Pa.: What is the current financial state of the Kennedy Center? Do you receive public funds, and if so, what are the proposals for future funds looking like? Are private donations remaining strong, or has this economy led to cutbacks in what people are giving?

Michael Kaiser: Thanks for asking. The Kennedy Center receives public funds for the upkeep of our building since we are the official memorial to President Kennedy. But like other arts organizations, we have to find the resources for our programming. We are doing well, though it is a challenge in this environment. Fortunately, I saw the writing on the wall a year ago so we could affect this year's budget early and have not been forced to take drastic actions. We expect a small but proud surplus this year.

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Arlington, Va.: Good morning, Mr. Kaiser. As a former Kennedy Center employee, I want to express my great admiration for the way you have led the institution. Now for my question: I know that many of the KC's programs are sponsored by donations from entities like Fannie Mae. I can only assume that those resources have decreased drastically. Will there be any impact on Kennedy Center programs, such as Millennium Stage?

Michael Kaiser: Thanks so much for your compliment. Yes, we have lost some corporate donations this year, but we have cut other expenses to make sure that flagship programs like the Millennium Stage can be saved.

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Alexandria, Va.: To what extent does the graying of the audience at opera and the symphony contribute to the crisis in support for the arts? Does the "aura of the old" dissuade younger folks, who could be long term contributors, from attending and getting involved?

Michael Kaiser: The audiences have been grey for many many decades. Mostly because people ages 20-45 tend to have very little discretionary time or money. I am more worried about the next twenty years because we have a generation coming up who have had little or no arts education in the schools and are less likely to become arts patrons when they hit 45 or 50.

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Wayne, N.J.: I represent a university presenting entity. Unlike many other presenters we have had to trim our season, lower prices, etc., but I don't see any signs that artists/managers are trying to accommodate our situation or the general economic outlook. How does one make that case to them effectively?

Michael Kaiser: I believe the case will be made over time when all presenters are offering less. I already see glimmers on the horizon of lower costs for artists.

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Silver Spring, Md.: Where do you see the Washington arts scene over the next five or so years?

Michael Kaiser: The arts scene in Washington area has never been stronger. We have a very active theater community (congratulations Signature Theater on the Tony award!), a great music community and more and more presenters -- with Strathmore, George Mason and others becoming more active. I am very optimistic.

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Kansas City, K.S.: What kind of cuts did the Kennedy Center have to make in this economy?

By the way, I read your book and enjoyed it very much. Especially the chapter on the Kansas City Ballet, my hometown ensemble.

Michael Kaiser: Thanks for the compliment on the book. We cut a good deal of administrative costs including staff travel, costs of events, etc. We were also very careful to negotiate all purchases. We find that vendors make good deals in this environment. Fortunately, we did not need to do layoffs or cut programming.

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Arlington, Va.: What is the worst thing that arts organizations are doing now to survive? Not admitting their circumstance? talking too much about their dire straits?

Michael Kaiser: I think the biggest mistake arts organizations make is to cut programming when other options exist. If your programming is dull, then donors will not chose to support you and ticket buyers will go elsewhere - especially when they have less to spend.

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Falls Church, Va.: Mr. Kaiser: Can you speak to the issue of the long-time bleeding of arts professionals due to their inability to earn a decent living? I am a long-time performing arts professional whose 25-year career ended when my position was eliminated (and I was a senior member of my organization), and after a two year struggle to find a position in the performing arts administrative world, was forced to change careers -- not because I had no opportunities, but because the salaries available would not cover my own very modest cost of living. This has, in my observation, resulted in a field where the average age of administrators is very young and staffs are forced to make a choice between continuing in this business or having families and paying mortgages. Unless these folks are at the very top of their fields, where the salaries are sometimes ridiculously high, they cannot make it. And in the current economic climate, there is not much alternative but to leave the field.

Michael Kaiser: It is a serious proble that most arts organizations can not pay enough to keep people in the field. That is why it is ironic when some people sugegst that arts organizations are peopled by the elite. In fact, the average arts salary in this nation is under $25,000 a year. If we do not do a better job raising money and selling tickets, we will not have an adequate workforce.

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Columbia, Md.: What organizations do you think are doing a good job of managing in these trying times? What do you see as the hallmarks of such management?

I understand that artists are being asked to give up more and more. How does an organization determine what is a reasonable request? I'm thinking of NYCO, in particular.

Michael Kaiser: I see many organizations across the nation doing a great job of management. These organizations plan well and early, have realistic budgets, great programming and aggressive marketing. They also have developed strong Boards. I am constantly amazed by the ingenuity and creativity of today's arts managers.

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Washington, D.C.: For college students, majoring in the arts (theatre arts, dance, music, etc.) what advice do you have? Should we have a "plan b"? Minor in something totally opposite? The job market for those areas doesn't seem good right now.

Michael Kaiser: I would never tell anyone not to pursue their passion but onw should be realistic. I was a music student (opera) and was lucky to have my own Plan B - which was arts management. It is a very creative field and very rewarding.

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Washington, D.C.: I worked in the arts (NSO, defunct organizations, arts service organizations) for fourteen years. I still work for not for profits but not in the arts. When I was forced out of my last arts job I was crushed emotionally. Even admin types get invested in this work. But several years out, I have to say that I would not work for an arts org of any kind again. They have some unique and peculiar dysfunctions. Maybe the late Rudolf Bing explained it best when he said in his autobiography that the personal element is 100 times more important in the arts. (This was a problem for him at the beginning of his tenure at the Met Opera since he was used to the autocratic European style of management.) This can make for some hellish work situations. I thought this was normal but I now know it is not. An arts org can be like a really dysfunctional family. I have interesting memories but I think I prefer (relative) mental health.

Michael Kaiser: I have seen dysfunctional cultures in all kinds of corporations and organizations and I have also seen very fucntional arts organizations and corporations and other not-for-profits. It is true that the creativity involved in an arts organization must be accomodated by the culture, but a good manager knows how to do this without sacrificing a workable environment.

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Haymarket, Va.: You are an advocate for professional development in the area of arts management and due to budget cuts that most organizations are experiencing their is little to no funding for professional development. How can a manager still create opportunities for staff development in times like these? What types of programs do you implement for your own staff?

Michael Kaiser: It is true that a lot of professional development is not happening now. I lead sessions for my staff -- that is one way to do it for free! The Kennedy center is also offering free workshops across the U.S. That is another way to get free professional development at this time. Go to the artsincrisis.org to get information on our seminars.

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Bethesda, Md.: How do you think the changes that arts organizations are making today will affect the arts community one year, five years, ten years down the line?

Michael Kaiser: Those arts organizations that are cutting programming will be hurt for years to come - because they will not recover when the economy recovers. Those arts organizations that remain vital during this period will recover with the economy and should be strong. But we all are affected by the competition from on-line activities and the problems of the newspaper and recording industries and we have to work harder to be attractive to audiences and donors.

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Capitol Hill, D.C.: Mr. Kaiser: Thanks for taking questions. Here's mine: How best to decide where to give my arts dollars?

I'm semi-retired, so I don't have lots of money to contribute. I volunteer for one large performing arts group that I also give money. But lots of little groups need money, maybe even more. Because of my age -- and the fact that I've been as generous as possible in the past -- I get lots of requests by mail, by phone, by e-mail. Sometimes I think that giving a little bit here and a little bit there at least encourages groups to feel appreciated. But should I consolidate my contributions into one larger gift that might actually make a difference? (And I also contribute to groups that feed the hungry, because people can't enjoy music if they're hungry.)

Michael Kaiser: I believe you should give to those organizations whose missions appeal to you and who are working hard to achieve their mission. If you give one larger gift you may get more benefits from the single organization but that is not the reason most people contribute. They contribute to feel a part of an organization. It sounds like you have many interests and passions so spreading your gifts may give you more joy.

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20009: Doug McLennan had an interesting blog post the other day about which is more valuable -- the frequent ticket buyer or the donor. I'm curious, which is more important to the Kennedy Center -- someone who purchases 10 tickets over the course of a year at $100 each or someone who writes a check for $1,000 and never attends a performance? As a careful reader of your marketing, I think I know the answer...

Michael Kaiser: We do our art for theose who come to see it so the frequent ticket buyer is very valuable to us. But we also value our donors - because the cost of the ticket covers only half of our expenses. We don't value one over the other. We are grateful to both.

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Washington, D.C.: Which do you think will be the donor constituencies most impacted by the current economic crisis in the long run: corporate, foundations or individuals? In which one should a small performing arts organization invest the most?

Michael Kaiser: While all three donor groups will be affected by the crisis, I believe we will see the biggest impact on corporate giving. Foundations may reduce funding as their endowments shrink but many are increasing their spending rates to help during this crisis. Individuals are typically the most generous during downturns.

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Washington, D.C.: In the hope that the economy will turn around eventually, what are the most important things for an organization to do if it wants to weather the storm?

Michael Kaiser: Arts organzations must not spend more than they take in. But where you cut your budget is important. Try to cut artistic programming last, not first. The organizations that will compete best for audiences and funding during this downturn are the ones that look the most interesting and vital.

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Michael Kaiser: Thanks everyone. I am sorry but time has run out. I am so happy that there are so many interested arts advocates who are concerned for the health of the arts ecology in this country.

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