THE BLOG
09/22/2014 09:18 am ET Updated Nov 22, 2014

Crisis in Europe

De Agostini / C. Sappa via Getty Images

A recent item on MusicalAmerica.com was as chilling as it was concise: "In its 2013 annual report, released last week, the Royal Concertgebouw has predicted that, without immediate support from the Netherlands government, it will be forced to disband by 2016."

The Concertgebouw is considered by many to be the finest orchestra in the world; Is it really possible that a world treasure will be forced to close? Did anyone see this coming?

But perhaps it should not have been so surprising to read this news. When we hear the General Manager of another world treasure, the Metropolitan Opera, suggest that bankruptcy is a possibility, nothing should surprise us anymore.

Indeed, the arts funding crisis in the Netherlands is not news. The New York Times reported as early as January 2013 about the remarkable decline in state funding there. One-third of the 120 leading cultural institutions in the Netherlands were no longer eligible for state funding. In fact, funding from the Dutch federal government dropped 22 percent from 2012 to 2013 alone.

This cut may be more dramatic than in other European countries but it is not unique; there have been cuts to grants for arts organizations in England and Austria and Spain and Portugal and on and on. One reads that only four opera companies in all of Italy are currently solvent. And the German government has encouraged several similar (albeit not exactly the same) organizations to merge to reduce costs.

In most of these countries, cuts from federal agencies have been matched by reductions in support from provincial government agencies. In the Netherlands, for example, the amount cut by the federal government was matched, euro for euro, by provincial governments--effectively doubling the pain.

We have experienced cuts in government funding in the United States as well. But for the vast majority of American arts institutions, government funding rarely exceeds 10 percent of our budgets. Cuts are painful but rarely catastrophic. In Europe, however, it was common for 50 percent or more of an organization's budget to be covered by state funding. A 20 percent cut might mean a vast downsizing of the organization.

Also, in the United States, we could attempt to cover decreases in government support with increases in private fundraising.

But in Europe, the size and predictability of government funding for many decades meant arts institutions did not have to do American-style private fundraising. This has left managers of European arts institutions in a quandary: How do they make up for these drastic cuts from their largest, and perhaps only, funder?

Some arts organizations have been attempting to change their funding models. Arts institutions in Ireland and Croatia and England are all trying to develop fundraising skills. (It is not surprising that the highest growth in demand for the teaching programs of my DeVos Institute of Arts Management at the University of Maryland is in Europe.)

But can important arts institutions across the continent create private funding bases rapidly enough to prevent closure?

Are we facing a world without the great institutions like the Concertgebouw?