How to aid the arts during a pandemic

That is the topic of my latest Bloomberg column.  In addition to “the usual,” we might also consider arts vouchers:

The second element of the arts rescue plan would take a different tack. Rather than giving money to arts institutions, the federal government could set aside some amount for a concept known as arts vouchers, originally developed by the British economist Alan Peacock.

Arts vouchers are similar to education vouchers except that they cover the arts. The government would hand them out to each American and allow state and local governments to specify which institutions and individuals would be eligible to receive such vouchers as payment. Unlike direct grants to arts institutions, arts vouchers give consumers a big say in where aid goes. They could be more popular with voters, because they give each one a direct benefit — namely, cash in pocket (yes, they would have to spend it on the arts, but it’s still cash).

Most of all, vouchers would recognize that planning authorities, even at state and local levels, don’t always know which artistic forms will be popular. If some reallocations are inevitable — for instance out of nightclubs and into outdoor bluegrass festivals — vouchers will allow those preferences to be registered quickly.

Obviously, if state and local governments specify a narrow set of eligible recipients, arts vouchers aren’t much different than direct grants. In that case, little is lost. Still, one hopes that vouchers can be used more imaginatively. Imagine the city of Detroit allowing vouchers to be spent not just at the Detroit Institute of the Arts but also on hip-hop, street art and outdoor theatre.

In short, vouchers can allow American artistic innovation to proceed, even flourish, rather than merely preserving everything as it was before the pandemic. Vouchers also serve an important macroeconomic function by maintaining consumer spending and demand, thus addressing one problem area of the broader economy. With direct grants to arts institutions, there is always the danger the funds simply will sit in the coffers of still-closed non-profits while the broader economy remains weak.

Vouchers shouldn’t be the entire plan of arts assistance for at least two reasons: They may not be a sufficient lifeline for small arts institutions that cannot yet reopen, and they may not help the arts sectors that draw in foreign tourists, most of all in New York City.

There is more at the link.