Unsurprisingly I find myself these days participating in a large number of discussions on what the financial and economic downturn means for businesses and organisations involved in the arts. The overwhelming feeling is predictably pessimistic.
History suggests that business-facing creative sectors, like advertising and architecture, face particularly challenging times as demand for their services slow down. The prospects for more consumer-facing creative sectors, such as film and the performing arts, are more uncertain. On the one hand, there are the negative effects of generalised weak consumer spending, but on the other there may be positive effects if households spend more of their time on cultural leisure activities.
Cultural organisations are also bracing themselves for the impact of the credit crunch: sponsorship deals may be seen as an unaffordable luxury by cash-strapped companies. In a recent survey by Arts & Business, two-fifths of companies interviewed thought that the economic downturn will negatively impact their arts sponsorship activities.
But whilst the arts will surely suffer in the short term -like other sectors - it is not inconceivable that the crisis may create a more positive long-term climate.
Whether or not this happens depends on the diagnosis of the root cause of the current economic downturn. Some views -call them "technocratic" -attribute the crisis to a failing of domestic and international regulatory frameworks. Looking forward, by implication, the solution lies with more robust regulatory frameworks.
If this is how the crisis comes to be perceived, then regulatory reform combined with measures to help businesses through the downturn will be the focus of policy. Special treatment will in effect be given by the government to those sectors, including the creative industries, which have large numbers of small companies, but any special case for support for the arts will likely fall on deaf ears.
But there is an alternative perspective on the downturn. "Communitarian" interpretations see ethical failings in the economy that gave rise to the current crisis. The system which facilitated the unbalanced growth of financial markets over other sectors, it is argued, is one which failed to balance individual rights with that of the community as a whole. Bonus-hungry, self-interested investment bankers did not pay attention to the social consequences of their decisions. Policymakers placed undue weight on the power of market institutions, and underemphasised the importance of social capital. The response to the crisis must go way beyond regulatory reform -changes are needed to attitudes in society as a whole.
If in time such communitarian strands of thinking gain influence in policy, new opportunities for the arts may emerge, for the simple reason that no discussion of social and civic responsibility can fail to engage with cultural issues. Even businesses, under pressure from policymakers and the public, may look for ways to demonstrate an increased commitment to society, including support for good causes in the arts.
Perhaps, then, one of the outcomes of the crisis will be a stronger sense of the role of the arts and culture in society, which may present opportunities for creative businesses and arts organisations.
