More Than Just Musically Bankrupt

Bill Eddins posted a fascinating article on 5/13/2011 over at Sticks and Drones that examines the potential domino effect impact of the Philadelphia Orchestra bankruptcy on all sorts of commonly found written agreements in the business…

In short, Eddins laments the thought of an orchestra using bankruptcy as nothing more than a convenient option for some sort of arts governance mulligan.

I think this is what disturbs me about the bankruptcy proceedings in Philadelphia.  The Association’s stated reason for declaring bankruptcy is to get out of all of their contracts.  If this is allowed then any organization can arbitrarily decide to declare bankruptcy whenever they so desire for no more reason then they want to and they feel too lazy to fulfill their contractual obligations.  At this point any contract will not be worth the paper it’s printed on.  This has very disturbing implications that reverberate far beyond the music industry.  Bankruptcy has historically been, and should remain, the avenue of last resort.  Either that or every contract written today is fundamentally worthless.

Eddins has every right to be concerned. I posted a lengthy comment in response to his points that I feel strongly enough about, I wanted to post them here as well.

You are so looking in the right direction with all of this Bill. One of the very real concerns behind closed doors is that if the Philadelphia Orchestra Association is released from contractual obligations given the arguable conditions behind the filing, it will be the impetus of a stampede of bankruptcy filings.

In particular, pension obligations will serve as the spearhead but no one should be surprised if that is followed by a long shaft of riders to remove everything unrelated to economic or operational issues. Case in point, look at the initial contract that was implemented by the Detroit Symphony Orchestra that contained everything from removing tenure to gutting the audition and artistic review process along with declassifying musician positions as not being sufficiently musicianish.

What’s particularly ironic about all of this is even though much of this is being promoted under the banner of progress, increased relevance, flexibility, etc. much of it is as old school as Ray Hair’s embarrassingly outdated rhetoric in the recent WQXR panel discussion.

As a result, the reasons behind why so many of those contractual items you mentioned that are really no longer applicable are held onto, is over a deep rooted fear that if you start letting go, it will be followed up by exactly the sort of old school nonsense that took place in Detroit.

It’s becoming increasingly clear that for some in this field, the cultural cold war never ended, it simply underwent a rebranding campaign.

So far this season, the Louisville Orchestra bankruptcy with subsequent requests for release from contractual obligations was rejected. We’ll have to wait and see what transpires in Philadelphia.

About Drew McManus

"I hear that every time you show up to work with an orchestra, people get fired." Those were the first words out of an executive's mouth after her board chair introduced us. That executive is now a dear colleague and friend but the day that consulting contract began with her orchestra, she was convinced I was a hatchet-man brought in by the board to clean house.

I understand where the trepidation comes from as a great deal of my consulting and technology provider work for arts organizations involves due diligence, separating fact from fiction, interpreting spin, as well as performance review and oversight. So yes, sometimes that work results in one or two individuals "aggressively embracing career change" but far more often than not, it reinforces and clarifies exactly what works and why.

In short, it doesn't matter if you know where all the bodies are buried if you can't keep your own clients out of the ground, and I'm fortunate enough to say that for more than 15 years, I've done exactly that for groups of all budget size from Qatar to Kathmandu.

For fun, I write a daily blog about the orchestra business, provide a platform for arts insiders to speak their mind, keep track of what people in this business get paid, help write a satirical cartoon about orchestra life, hack the arts, and love a good coffee drink.

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