Politics, Art, and California’s Public Policy Failure

[courtesy of California Progress Report]

By John Gallogly

California is mired in a $16 billion dollar deficit, without the political will to overcome deliberately designed structural impediments to solving the problem. For most government and nonprofit organizations, mission determines function. The United States Constitution clearly lays out the ‘mission’ of the government in the Preamble: “to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity,…” But the practical result of recently incorporated laws and referendum promoted by those who believe that less government is better government has had the opposite effect. In California, the two third majorities needed to both raise taxes (passed with only 55% of the vote), and to enact a budget, have created a situation in which a small, but determined minority can act in concert to thwart those general aims of the constitution and the citizenry.

Arts funding in California serves as a case study of the failure of political parties to create appropriate public policies. California ranks 53rd in the nation in general fund arts funding behind Puerto Rico, Guam, Washington DC and the other 49 states. This, in spite of the fact that Americans for the Arts’ Creative Industries Study (2007) reports the economic impact of nonprofit arts and cultural organizations in California is $5.4 billion, and California is home to 86,012 arts-related businesses that employ 484,657 people. In its 2004 report “The Arts: A Competitive Advantage for California II”, the California Arts Council found that nonprofit arts organizations alone generate $300 million in state and local tax revenues, attract 71.2 million in annual attendance and 6 million out of state tourists to California. In addition the “California Public Opinion Survey” conducted by BRS Group, Inc. (2001) showed, “More than 78 percent of Californians would be willing to spend $5 apiece in additional state taxes to fund the arts.

California’s lack of investment in the arts – currently we invest only 3 cents per capita of general funding versus NY’s $3.00 and Hawaii’s $5.51 per resident – hurts education, business, quality of life and even costs the state revenue by undermining its tax base, and flies in the face of overwhelming public opinion. The arts in New York City for example generate over $10 billion per year in revenues. But Los Angeles, which according to a University of Michigan business school study (2002) has more museums, theaters, and artists in every area of the arts (with the exception of novelists) generates only $500 million. Government investment in marketing Los Angeles arts assets could lead to a bonanza of local revenues, jobs and tax dollars. Yet all of these fact based arguments are rejected by ideologues for whom the constantly shouted mantra of lower taxes trumps promoting the general welfare, establishing justice, and insuring domestic tranquility. On a national and local level their calls have been answered, especially for the wealthy. IRS schedules show taxes have declined from 91% for those with earnings over $400,000 in 1963 to only 15% in 2002 for those whose earnings come from dividends.