Yes, it's the last day of the year, a time for 10-best lists, reviews of the past season in the arts and strenuous inspection of the cultural sands at the bottom of the hourglass. Short-term memory is flexed, accomplishments touted and embarrassments glossed over. But it's also a good time to look ahead, a chance to express optimism or pessimism about art and culture in the next year. Last year's big stories -- a continued, bruising battle over government funding of the arts and the downturn of the economy -- figure prominently in most prognostications for the coming year. Here's what some cultural notables had to say about the state of the arts in 1991:

J. Carter Brown, director of the National Gallery of Art: "I'm very bullish for museums next year for two reasons: First, 1991 is the year of the tax change {allowing donated works of art to be assessed at current value for deduction}, so I think we can expect donors to recognize this as a one-year window of opportunity. ... So that's one piece of good news. The second thing is the art market seems to be getting a little more sensible in terms of what {can be purchased}. So basically, I'm optimistic."

Joseph Papp, New York Shakespeare Festival producer: "You want to know what I think? Here's what the headlines will be: 'NEA and Mediocrity Crisis. Panels Resign. Frohnmayer Bows Out, No Curtain Calls.' That's my prediction for the new year. I think they've weakened the NEA so much with those cuts, and the attacks, I don't see anything important happening ... I don't hold much faith in the NEA doing anything because they have no aspirations, and art without aspiration is not very much ... So this is a hypothetical situation. But there's a crisis." (NEA Chairman John Frohnmayer did not respond to calls from The Post.)

Ramon Osuna, president of Dupont Circle Galleries Association and owner of Osuna Gallery: "For 1991? In terms of what I do, I just know that art will continue to be bought and sold, no matter what the conditions are. It's one of the world's oldest professions."

Laughlin Phillips, director of the Phillips Collection: "There's an awful lot of things that worry us. I feel that museums will need all the help they can get in 1991. If present economic trends continue, some will undoubtedly have to cut back on the services to the public."

George Stevens Jr., filmmaker and founder of the American Film Institute: "The single best lesson concerning the arts that I had was from my father. He taught me to trust the audience. I would say that is the lesson for 1991. ... Artists have always struggled. I think that strong artists struggle and survive and I think that will happen again in 1991."

Michael Kahn, artistic director of the Shakespeare Theatre at the Folger: "I hope that the Congress as well as the American people will realize that {the NEA imbroglio} was a senseless controversy over a shockingly small amount of money that the government gives to the arts. I hope the passionate part of it has blown over. ... I'm always realistic. I'm always optimistic about art because it is always done by people with passion and I believe that people with passion can do a great deal in complicated situations."

David C. Levy, new president and director of Corcoran Gallery of Art: "I think the arts have to remain a little bit on the defensive. I also think that the uncertainty of the economy won't be helpful. People can be much more relaxed and expansive when things are going well.

"{The directorship of the Corcoran} is going to be a challenge." His immediate goals? "To drive safely to Washington on New Year's Day, get there in one piece and start cracking."

Doug Wager, incoming artistic director at Arena Stage: "I believe over the next few years a generational influence on the insistence on a higher and fuller role of arts and culture in our society will prevail. At the same time I'm disturbed and alarmed at the ferocity of the attack that was launched against the arts community in the past year. I feel that it's not over."

Marilyn Zeitlin, executive director of the Washington Project for the Arts: "I hear rumblings from my colleagues in other cities that their institutions are very much in danger. I think there's going to be a lot of belt-tightening and everyone is going to have to reassess their priorities. In terms of what artists are going to address, I think there will be a more direct confrontation of the issues."

Charlotte Murphy, executive director of the National Association of Artists Organizations: "My hope is that instead of taking a rest from last year's controversy, the artists will continue to be politically active. For the arts, there are some harsh realities ahead. On the other hand, I think it's one of the most exciting times in the arts. I think artists are going to be the spokespersons for a new and better America. I really believe that. Did that sound a bit like a car commercial?"

Happy New Year.