The Myth of the “Structural Deficit”

by Leonard Leibowitz, ICSOM Counsel

A new “virus” referred to as the “structural deficit” is rampant in symphony orchestras throughout the nation. This insidious infection poses a severe threat to musicians everywhere in their never-ending quest for the growth of their institution and the improvement in the quality of their lives and the lives of their families. The severity of the problem is exacerbated by the fact that the “virus” is a myth created for the purpose of stopping the aforementioned “quest” dead in its tracks.

Simply put, the so-called structural deficit is just another variation on management’s tired old claim of “inability to pay.” Lately, management alleges that it cannot meet our demands for wage and benefits increases because it claims it cannot raise any more money in the community. A “glass ceiling” on fund-raising? Nonsense! Allow me to explain.

As you all know, the boards of our institutions are comprised of men and women who serve thereon for a number of reasons—some good and generous, some less good and less generous. But none of these reasons include making a direct profit from their service as trustees of the institution. Thus, whether they serve because they are music lovers, married to music lovers, or business men and women seeking to meet other business men and women in order to do business, etc., their incentives do not normally include merely improving the quality of life of the members of the orchestra.

I rush to explain that this is not intended as an assault on the motives of these good men and women. Most of them have no objection to the advancement of the musicians—but for the board, the bottom line is the maintenance, at least, and, surely in many cases, the improvement of the quality of the orchestra. Most of these folks are quite generous with their own giving, and some even spend a good deal of their time attempting to persuade others to give as well. But for virtually all of them, the symphony is not their primary vocation. Their willingness to serve is often limited to only that amount of time and energy which is “comfortable” for them. Too often they withdraw from their board membership because they are unable or refuse to spend the time and energy necessary to do a proper job of fundraising.

One of the major causes of the increasing call on their time is raising money to fund the musicians’ wage and benefit increases which cannot possibly be paid for by earned income alone. Moreover, those additional costs, understandable as they may be, can also not always be met by asking the same sources for greater and greater levels of contribution. This is particularly true when the economy is perilous, and those sources have actually cut back or eliminated their contributions altogether.

Nevertheless, the musicians of the orchestra, like working people everywhere, continue to need increases in compensation to keep pace with the ever-increasing costs of simply living in North America, and raising that money often places the board in that “uncomfortable” position, as compared to the far easier job of merely holding on to current contributors at the same level of giving.

Our goal in symphony negotiations is to persuade these good people that it is part of their fiduciary obligation to find and cultivate new sources of revenue in all areas, earned, contributed, etc. For the most part, it works. Often, at the conclusion of a symphony negotiation, I am approached by a board member or executive who, while happy about reaching a settlement, will express his or her concerns about the future. “I’m delighted we’ve gotten an agreement for the next three years, but I don’t know where we will find the money to pay for it.” Nevertheless, a few years later, the money has been raised—because it had to be.

Usually, in the course of these very same negotiations, the board, through their representatives, often reject our economic proposals by saying that they simply don’t have the money to pay for them. Our response is to point out that of course they don’t have the money now, but it is their job to find it. That’s what the negotiations are all about!

Now, someone, somewhere, has come up with an answer that is designed to trump such a response: they will not be able to find the additional revenue because they have run into an invisible ceiling which is external and out of their control. There simply is no more money to be raised in their community! Thus, if the musicians’ proposals will increase the budget, it is not possible to pay for it, and it is not a failure of will or motivation—it is a “structural deficit” (the word “structural,” of course, meaning “built- in,” “unchangeable,” simply the “reality of life in the city”). What is even more remarkable is that although this “structural deficit” was only recently discovered, once found in one city, it is now found in city after city throughout the U.S. and Canada!

If it were not so tragic, it might be comical. The logical extension of this argument is that symphony, opera, and ballet musicians (as well as dancers, singers, stage hands, clericals, etc.) are all either frozen at their current salaries, or worse, into a reduced level of compensation, at which they are left after making the concomitant concessions necessary to get the budget down below the “ceiling.” As ingenious as this argument is, and as appealing it must be to boards and managements, we must reject it for the sake of the future of each musician, the other employees of the organizations, and the institution itself.

In the past there have been downturns in the economy which have had adverse impacts on our ability to make gains. Indeed, we have often been forced to accept concessions in order to allow our boards and managements some breathing room within which to devise and implement a plan for recovery.

But just as we are asked to help solve the problem, we must insist on being part of the recovery as well. The recent Detroit reopener settlement reported in a recent issue of Senza [Goldman, J. “Once more unto the breach, Detroit, once more!” (July 2004)] represents a classic case of such a plan. It is the only way we should be willing to participate in being part of the solution. The alternative is to perpetuate the downward spiral to oblivion, just as is the acceptance of this canard of “structural deficit.”

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