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Arts Funding Feels Squeeze of Economic Downturn

Many arts organizations that depend on endowments and both individual and corporate donations are struggling to cope with budget shortfalls in the midst of the economic downturn. Analysts discuss the recession's impact on arts and cultural organizations.

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    The financial crisis of the last months has had all kinds of spillover effects throughout the American economy. Cultural institutions often get less front-page attention, but are feeling the pain in many places and in many ways.

    We look at this now with Sue Hoye, freelance writer and contributor to the Chronicle of Philanthropy, and Michael Kaiser, president of the John F. Kennedy Center for the Performing Arts in Washington and author of the recent book "The Art of the Turnaround: Creating and Maintaining Healthy Arts Organizations."

    Welcome to both of you.

    Michael Kaiser, what are the most direct ways? How do arts institutions feel what's happening in the economy?

  • MICHAEL KAISER, The Kennedy Center:

    Well, they see a real reduction in their contribution levels, primarily from government agencies which are hard-hit from foundations whose endowments have been hard-hit, from corporations who are suffering, and from individual donors. And this forces many arts organizations to make vast reductions in their budgets.


    And you're seeing that now?


    We see this across the country. In fact, we've seen many high-profile arts organization either close or threaten to close over the last several months.


    Sue Hoye, you've been documenting this for the Chronicle of Philanthropy. Give us some examples of what you've seen.

    SUE HOYE, Contributor, The Chronicle of Philanthropy: Well, across the board, everyone I spoke with has reduced their budget or is planning on reducing their budget different percentages, anything from the New York Botanical Garden, which is looking at a 10 percent reduction in staff, which they're doing through attrition at this point, but have 48 less staff at the end of this year than they had at the beginning, are looking at changes in programming for next year because of budget and reducing risk, to the Santa Cruz Natural History Museum in California…


    In California.


    … which is possibly closing in February. They've lost half their funding, which came from the city, which can no longer fund them. So they're running around trying to figure out whether or not they can find a way to survive and are pretty sure that they might come up with something, but it won't be anything nearly the same as it was when they started.

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