Innovation Is Expensive. Starving the Arts Is Not Strategy.
The growing gap between artistic ambition and financial reality threatens both excellence and access.
Across the performing arts sector, a quiet but profound contradiction is unfolding. Arts organizations are being asked—by audiences, artists, critics, funders, and civic leaders—to be more ambitious than ever: to commission new work, champion diverse voices, innovate digitally, tour internationally, and serve broader communities with deeper relevance. At the same time, the financial foundations supporting this ambition are eroding. The result is a widening gap between artistic aspiration and economic reality—one that is pushing institutions into chronic deficits and unsustainable operating models.
Over the past two decades, artistic costs have risen dramatically. Inflationary pressures affect nearly every line item: musician and artist fees, production labor, stagecraft, technology, travel, housing, insurance, and health benefits. Complex contemporary works—often interdisciplinary, multimedia, or involving larger casts and technical requirements—are inherently more expensive to produce than standard repertory programming. Innovation, quite simply, costs money.
Yet earned revenue has failed to keep pace. Ticket prices across much of the arts ecosystem have remained flat or, in real terms, declined. In many markets, organizations have deliberately held prices steady—or introduced aggressive discounting—to preserve accessibility, attract younger audiences, and respond to economic anxiety among patrons. While this commitment to access is laudable and mission-aligned, it has also locked organizations into revenue ceilings that do not reflect the true cost of production in today’s economy.
Contributed revenue, long expected to fill this gap, has its own structural weaknesses. One of the most striking—and least discussed—examples is the stagnation of board giving minimums. In many U.S. cities, board contribution expectations were set decades ago and have remained unchanged ever since. In Seattle, for example, many performing arts organizations established a $10,000 annual board giving minimum in 2006. Nearly twenty years later, that figure remains common practice.
The problem is not philosophical—it is mathematical. Inflation since 2006 has exceeded 60 percent. A $10,000 gift today has the purchasing power of roughly $6,200 in 2006 dollars. In other words, without any intentional reduction, board giving has effectively declined by more than a third in real terms. Meanwhile, the cost of living for artists, administrators, and technical staff has soared, especially in high-cost urban centers. Organizations are being asked to do more, pay more, and deliver excellence—while their most stable source of philanthropic leadership support has quietly lost its economic force.
Compounding this challenge is the reality that many boards, facing their own financial pressures, have frozen or eliminated minimums altogether in the name of inclusivity or recruitment. While broadening access to board service is an important goal, the absence of clear, inflation-adjusted expectations often shifts the financial burden onto a shrinking pool of major donors or leaves structural deficits unresolved. Good intentions, without recalibrated financial frameworks, do not balance budgets.
The consequences are visible across the sector: deferred maintenance, undercapitalized productions, staff burnout, shortened rehearsal periods, reduced touring, and an increasing reliance on one-time rescue gifts rather than long-term financial planning. Most concerning, organizations are forced into false choices between artistic excellence and fiscal responsibility—between innovation and survival.
This is not a failure of imagination on the part of arts leaders. It is a systemic mismatch between 21st-century artistic ambition and 20th-century funding assumptions.
If we care about excellence in the arts—about risk-taking, originality, and global leadership in cultural creation—we must be equally serious about modernizing the economic structures that support them. That means honest conversations about the true cost of art, inflation-indexed board leadership giving, diversified revenue strategies, and shared responsibility among institutions, funders, and civic partners. It also means resisting the temptation to solve structural problems with temporary fixes.
The stakes could not be higher. A world without a thriving creative class is a diminished world—one stripped of color, curiosity, passion, and belonging. The arts do not merely entertain; they help societies understand themselves, imagine alternatives, and connect across difference. If we allow the growing discrepancy between ambition and arithmetic to persist, we risk losing not only institutional excellence, but the widespread access to creativity that sustains healthy, humane communities.
The choice before us is clear: adapt our financial models to the realities of our time or watch the foundations of our cultural life slowly erode. The future of the arts depends on our willingness to confront this gap—openly, courageously, and together.
Krishna Thiagarajan is an arts executive and consultant who has led and advised major orchestras and performing arts organizations in the United States and Europe and currently serves as Chair of the Washington State Arts Commission.
