Why Theaters Fail and When We Should Save Them

Today in The Stranger, one of Seattle’s alt-weeklies, theater editor Brendan Kiley has an interesting feature article on how theaters fail. The main inspiration for the piece is dissecting the spectacular collapse of the Intiman, one of Seattle’s big regional houses, formerly directed by Bartlett Sher and then his hand-picked replacement Kate Whoriskey, for just half a season before years of fiscal mismanagement caught up with them. A last minute emergency funding campaign launched in November of last year was largely successful, but the situation continued to worsen, leading ultimately to the cancellation of the rest of the 2011 season to stabilize the situation, with the theater apparently intending to reopen next year should it find the capital.

But Kiley goes beyond the Intiman story to discuss several other collapses over the past decade in town, including the Empty Space, a widely regarded mid-size theater in Seattle producing challenging work in a traditional model; Giant Magnet, a former children’s theater festival that in the past few years had branched out to include work like Ontroerend Goed’s The Smile Off Your Face; and finally Consolidated Works, a contemporary arts center launched by one of Kiley’s predecessors, Matthew Richter, that collapsed after he was fired by the board (interviewing Richter in 2004 was, in fact, my first ever journo gig).

The entire piece is worth reading as a record of incompetence and mismanagement, but I think Kiley sort of misses the point. What he ultimately winds up focusing on is the failure of boards to properly do their job. “The board/staff relationship is fundamentally flawed,” he writes.

Boards do too much or too little. They either don’t raise enough money to keep an organization going or complain that they don’t feel enough sense of participation. Sometimes the board members don’t even attend the performances of the organizations they’re ostensibly there to oversee and support. (That was a problem at ConWorks and Giant Magnet.)

As regular readers know, one of the things we’re skeptical of here at Culturebot is “Big Ideas,” of which the arts has far too many, and unfortunately, I think that blaming boards has become the new “Big Idea” in the current moment, with so many institutions at every level facing crippling financial challenges. When an institution finds itself in collapse, someone has to be blamed, apparently. Sometimes it’s the artistic director (who spends the budget like he’s using an ATM card till he hits the overdraft limit), now it’s the board (for not saying no sooner). The unspoken assumption is that, in all cases, the institution itself was inherently good and needed to be preserved, because, apparently, it served and would continue serving its function well. But not only is it ridiculous to always assume that the institution should have been saved (they fail for different reasons, after all), but I can’t help but wonder if, in fact, it’s not sometimes good that they fail.

“Sustainability” is typically defined as a good thing in this context. Nonprofits, after all, can only hope for sustainability. It’s either that or going under. But calling a spade a spade and re-phrasing it as “self-preservation,” my colleague Michael van Baker at Seattle’s TheSunbreak.com (for whom I’m still an editor-at-large) recently wrote:

Because self-preservation is the defining aspect of arts institutional life–ironically, the non-profit model virtually guarantees it–the business model warps in that direction. People begin to have trouble distinguishing between best business practices and those that have worked in the past to pay everyone’s salaries. Over time, the institution’s existence–its habits and proclivities–mediates the art presented. It’s not just a question of the popularity of one work versus another–it’s a question of box office receipts. That’s what’s being discussed when the directors meet: saleability.

Van Baker is, I think, right in part. Of course, that concern never really translated to ensuring seasons ended in the black for the Intiman, which ran yearly deficits for some years before it really hit trouble, because the deficits were theoretically manageable, through either increased giving or increased sales in the next season. But austerity was never imposed the next year, and again and again they’d run deficits. In effect, the bottom line was set in the red, and each year they managed to scrape up enough money to keep going with yet another lauded, expensive season. Some have blamed the Intiman’s board for being starstruck by Bart Sher, but it’s equally true that they were stuck building a perilous house of cards once they started. Once you start operating that way, you can never go back. You can’t scale back the next season for fear of the collapse finally happening if audiences abandon you or donors aren’t impressed by critical accomplishments, so you keep growing and spending more to keep audiences coming, and even as they dug their own grave, they racked up remarkable critical and popular accomplishment.

And that’s where my disagreement with Michael van Baker comes from: saleability is not the end of the world. Every theater has two masters: the arts community, who want new challenges and opportunities and therefore risk, and audiences, who have more complex but ironically somewhat more predictable expectations. Over time, Van Baker’s right that the model mediates the art in favor of saleability, but to judge by the Intiman’s record of critical success and audience development, its slow, downward slide was anything but a middle- or low-brow disaster.

Which leads me to my point: maybe the Intiman just needed to close. At a certain point, its debt load was so high that continuing to operate would have required (and, if they re-open, will) lesser works, skimpier budgets, and therefore quite likely lesser achievements, because so much money will be spent servicing past deficit-funded operations. That the crisis at the Intiman hit in the current economy is predictable: slowed ticket sales and less charitable giving finally meant that it couldn’t meet its current obligations as well as covering the previous year’s deficit. Like a Ponzi scheme, to which the model bears some resemblance, it only collapsed when the in-flows were insufficient to cover the outflows, which were building up over time.

But if we actually believe in the Intiman’s achievement, as I think we should, then maybe it’s just a sign that the cost of accomplishing that was higher than potential revenues. They had a good run, but if they can no longer credibly meet the expectations of either the artistic community or their audiences, they should stop, because what’s the argument for them to be sustained through paying out for diminishing returns? Because we lose the institutional expertise? (The administrators apparently disappear along with their jobs.) Because it takes so long to build a subscriber base? (The subscribers who stick with you through your austerity seasons are rendered suckers.) The fear that such institutions could never be replaced because of the changed funding structure? (Said argument, I think, proposes they’re doomed, anyway.) What is it other than nostalgia for everything attached to the name of the company and everything associated with it that’s really worth preserving when facing those choices, and who really believes that nostalgia is worth the price tag?

Kiley himself almost touches on this, wondering, “The regional theater movement is less than a century old and might prove to be a failure, especially since corporate and government funding for the arts—the revenue that the regional- theater movement is predicated on—is gone for the foreseeable future.” But of course the regional theater movement was already a failure, to judge by its current incarnation. It was founded to provide a network of theaters that offered employment and opportunities for new challenges to artists in a local community, for a local community. The vast majority of these theaters long ago abandoned their role as an incubator of local talent to serve their audiences by doing shows that people wanted to see more, shows that were more saleable, and hiring non-local talent to make those shows happen.

For good or bad, Van Baker is correct that this is the calculation that comes to dominate over time–it’s a matter for funders and audiences to reward or punish it, just as would be the case if the theater committed itself to producing risky, new, challenging work by emerging local artists that it knew it didn’t have a ready paying audience for. So if you want opportunities for emerging artists (as I do; that’s where my prejudice lies), I see no reason to believe that the death of something like the Intiman doesn’t create room for new growth and development. Quite the opposite, new institutions will likely serve the artistic community better, even as they face distinct business challenges.

I do not remotely believe that arts organizations should try to be more “business-like” by learning from the private sector, nor do I think private partnerships (as has been suggested elsewhere) can save the arts (without further mediating artistic experiences for short-term business ends). But I do think creative destruction can be beneficial to the arts. Again, the institution is not the same as the artists or their products; the institution exists to facilitate the art. This isn’t to suggest we should never try to save institutions–to look at the rest of Kiley’s examples, Giant Magnet and Consolidated Works were both destroyed by the needless termination of a visionary director, which left the organizations floundering, while Empty Space’s board rushed to liquidate following a far more minor financial crisis.

Those are all very different circumstances, and from those we can be judicious in asking whether it was their time or whether they had more to offer. For three of them, compelling evidence exists that they could have gone on; for the Intiman, I see no such information. And lest anyone be mistaken about what’s going on, there’s still a good chance that the Intiman will come back. That’s a shocking injustice and, if achieved, a ridiculous misuse of limited arts dollars, as I’ve already tried to explain. The Intiman should have been allowed to pass, its bitter, not yet set-in-stone eulogy a swansong of success. Instead, nostalgia and attachment to a history that will cost a fortune to maintain are keeping some, misguided hope alive for a burnt-out theater. In an interview for the story, Kiley comes across this very concept:

Richard Linzer is a consultant who has worked with dozens of nonprofits across the country: On the Boards, City University of New York, Empty Space Theatre, Folklife, Stanford University, etc. He and I talked for a few hours about nonprofit theater, but we only got really animated when comparing notes on shows we’d both seen. ‘See there?’ he said. ‘See how excited we just got when talking about performances? In the nonprofit sector, we tend not to want to be cold and rational. We don’t want to look at the cost of raising a dollar or borrowing a dollar or getting involved with appreciation and amortization. It’s the red meat that we love—the dancers and singers. For the audience, that’s why we go. But for the board, it’s a different thing.’

Precisely. The Intiman created many such moments for people, but at too high a cost to preserve indefinitely.

7 thoughts on “Why Theaters Fail and When We Should Save Them”

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