The release of Richard Florida’s book The Rise of the Creative Class has sparked a new wave of public and government awareness of the value of creatives to the broader economy. Florida’s argument is pretty simple: cities which encourage and promote a positive and nurturing atmosphere for creative industries workers reap economic rewards. His latest book, The Flight of the Creative Class, takes America to task for not doing enough, and warns that the creatives will seek a home elsewhere in the world instead, thereby depriving the United States even further.

I don’t disagree with the fundamental propositions offered by Florida. I enjoy living in Melbourne. I enjoy walking down Acland Street, near my home in St Kilda with my children exclaiming in delight at the massive artworks perched atop the hairdresser. I always encourage the kids to give money to the buskers. On Sundays we browse along the  St Kilda Sunday Market stalls, tasting and testing all manner of home produced goods and artworks.

And it’s when I’m wandering the markets I realise what I’m seeing – an arts business economy hard at work. Last time I looked, the Australia Council doesn’t hand out grants to run an arts market stall. Or offer a free download on their web site of publications to help an artist research, plan and operate a market stall. Yet the markets are a microcosm of a massive arts economy.

I’m not going to bother to quote the statistics. We can elocute to the fact Australia’s cultural economy is worth billions of dollars. That it employs hundreds of thousands of people. And that it exports all over the world – even if our imports of cultural product outstrip the exports by two to one.

The market stalls remind me that an economy which cannot stand on its own two feet is not an economy. No-one in their right mind is going to take the trouble to book and pay for their stall; muster up stock; set the alarm for an ungodly hour on a Sunday morning; and stand in the winter chill on a cold pavement all day while hordes of only sometimes interested people tramp past, touching, prodding and poking the stall holder’s wares – unless it makes economic sense. This isn’t a government funded art-fest. It isn’t art for arts sake. It’s business. It’s a way for the stall holder to earn money to help feed themselves and often their families.

You cannot bypass business fundamentals. A market stall costs x amount to rent. The goods you sell on the stall cost y in materials to produce. The customers hand over z to purchase the goods. If z is greater than x plus y, then you made a profit. If less, you made a loss. And what on earth would possess someone to continue if it made a loss? Richard Pratt, the cardboard box making, showbiz supporting billionaire was once asked his secret to successful business. His response: earn more than you spend.

Back in the early 1980s when I finished school I had no idea in the world what I wanted to do. I enrolled in a Bachelor of Arts at Monash University, majoring in English, English, English, oh and more English. Which means I can spell. I got kicked out after first year – probably something to do with a complete lack of work in the last part of the year. Albeit following a promising start, with plenty of distinctions and credits in the first couple of terms.

Problem is, I was bored shitless. I was in a holding pattern. I was completely uninformed about the world, and uninformed about my choices in the world. I became involved in student theatre, wound up with a job in the campus theatre, and that led to a 12 year career in technical and operations management in theatre and entertainment facilities around the country.

If I could have my university application all over again, I would apply for an economics course. In retrospect, it’s quite clear to me I would have been a far better arts manager had I completed an economics degree, rather than one in arts management. Today, with nearly ten years under my belt running my own company, it frightens me to look back, and realise how naïve, uninformed and generally ignorant of business I was in my arts management days. Clearly I stumbled through and didn’t fall completely on my face but, I suspect, there are plenty of arts managers out there stumbling along today.

If I had had an economics degree under my belt, I might have started to ask the questions 20 years ago that I ponder today. Because despite my acceptance of the general Florida mantra, I’m now coming to the conclusion that government grants for the arts – grants given to arts companies and individuals, are a bad thing.

Grants breed a welfare mentality, of living with the expectation of funding. Long term unemployed, those who have been the recipients of government handouts, are considered amongst the most disadvantaged in our community. Great amounts of time and money is deployed in the quest to return them to the workplace and employment. Yet arts companies, and some artists, have been effectively living on government welfare for decades. Oh, sure, from time to time there are murmurs of ‘reducing their reliance on recurrent funding’, but nobody takes it really seriously. There is a presumption inherent in arts managers that whatever the ebb and flow of trendy management theory amongst government arts agencies, at the end of the day the triennial funding agreement will still come through.

Grant funding is a vicious, non- productive circle – just like long term reliance on the dole. It ties people into a pre-determined model, instead of exploring alternatives. It’s a bureaucratic, unimaginative way to do business. Each year the Australia Council and sundry state government arts ministries publish their glossy grant round booklets. Each year arts managers and artists pore over the colourful pages, considering how they can manipulate and massage their current visions into the frameworks compiled by a bunch of government employees sitting in their ergonomically designed cubicles.

Grants cost the applicant time and money. You take time to apply, to wait for a response, to report and acquit. Yet you can’t claim that time and labour as part of the grant application. In many cases, if you perform an ROI (Return on Investment), the cost to service the grant could be larger than the grant itself. It’s a poor economic decision.

It’s easy to blame a lack of artistic output on a lack of funding support. Yet the funding levels will never substantially change. The arts has been arguing it is under-funded for decades. Apparently the first Australian arts grant was given in the early 1880s – a poet named Michael Robinson was given a couple of government cows for his services as Poet Laureate. Inevitably one can presume two things: Robinson didn’t think two cows was enough, and all his fellow poets thought he had compromised his artistic integrity for taking the cows in the first place. 

Grants avoid ruthless feedback. Yet acceptance of feedback is a critical skill to survive in life and business. And to improve an artist’s work. Instead the feedback is couched in jargon and comfort words aimed at avoiding confrontation.

I want to be clear here – I’m talking specifically about application based grant funding. For example, conversely to grants, I believe sponsorship and philanthropic support are outstandingly positive elements. They promote business and community interaction, they are, generally speaking, based on realistic business objectives and ideals, whether it be a major telecommunications company sponsoring the Australian Opera, or the local printer supporting a local theatre company by printing the show’s posters for free.

Every election, every budget, the arts makes yet more submissions to government. Occasionally incremental increases are found. Some major arts sectors have been on the bust boom cycle for years – the latest are the symphony orchestras, before that the visual arts, before that performing arts companies. Of course it requires an expensive public enquiry conducted by a high profile person (notice how the enquiry heads are invariably high profile BUSINESS people: Helen Nugent, Rupert Myer, James Strong) to find that the enquired-upon arts sector is economically unviable in its present shape/form/composition/funding level/audience size.

In my more extreme moments I conceive of dumping arts grants altogether. Maybe arts organisations should be made to endure the same economic realities as the Sunday Market stall holders. Perhaps we’re giving the money to the wrong people? Lets instead give it to the audiences – the general public – in the form of rebates for attendance. Instead of ‘Medicare’, why not have ‘Artscare’? Each time a person pays to go to an arts event, they tootle down to the ‘Artscare’ office, fill out a form, and receive a portion of their attendance cost back. We can even have bulk billing for children and seniors.

A long time ago a well respected arts manager told me mine would be the last generation of arts administrators without university degrees. She was quite right. My problem is whether the training institutions of today are pumping out bright-eyed graduates with the right skills sets? 

I’ve had reason of late to delve into the world of Cooperative Research Centres, a major Federal government program to support centres of research excellence in conjunction with universities and industry. The quick summary of the CRCs is:

“The programme emphasises the importance of collaborative arrangements to maximise the benefits of research through an enhanced process of utilisation, commercialisation and technology transfer. It also has a strong education component with a focus on producing graduates with skills relevant to industry needs.

The CRC Programme was established in 1990 to improve the effectiveness of Australia’s research and development effort. It links researchers with industry to focus R&D efforts on progress towards utilisation and commercialisation. The close interaction between researchers and the users of research is a key feature of the programme. Another feature is industry contribution to CRC education programmes to produce industry-ready graduates.”

If I had my way, this would be a pretty good philosophy for the universities when turning out arts graduates – of all flavours and disciplines. The tertiary institutions are seen as centres of excellence, producing industry-ready graduates. The institutions’ efforts are focussed on projects and activities which have commercialisation potential, and thus economic potential – entirely consistent with the Florida thesis of using cultural activity to stimulate a community’s economic vitality with creative endeavours and personnel.

The graduates are encouraged to take the lead, to do it for themselves, to act independently and in a way which is productive to themselves and others through making a cultural contribution to their local economy. Just like a Sunday Market stall holder. Instead of waiting around for a grant application to be approved.