Beyond taxpayer-funded temples of establishment art, people are flocking to participate in festivals – and paying to do so

This is a tale of two cultures. Towering over Walsall town centre is an acclaimed icon of 20th-century architecture. There is another in Gateshead, another in Salford, another in Cardiff, another in Edinburgh, and many in London.

The Walsall art gallery is adorned with two sure signs of big art, a clutch of architectural awards and a clutch of deficits. Nothing embodied the extravagance of millennial Britain so much as the stupefying sums spent on large arts buildings, with little idea of what to put in them. One day they may yet lie like the Greek theatre at Palmyra, a silent ruin in an empty desert.

These monuments cost huge sums. The Sage Gateshead cost £70m, Salford’s Lowry Centre £106m and Tate Modern £134m. The British Museum’s new courtyard alone came in at more than £100m. Nor did anyone think of running costs. Within three years of opening, visitors to the Walsall gallery needed a £9 subsidy a head from local ratepayers and a further £2 a head from the Arts Council. At a capital cost of £21m it has stumbled from crisis to crisis, but at least houses the world’s most expensive Costa coffee bar.

The chief stimulus to the splurge was the national lottery, taxing mostly the poor to spend on mostly the better off, followed by the wild ambitions of the millennium. The dream of culture politicians was not art but buildings. Intense debate in the mid-90s was about whether lottery money should go into people or structures, into revenue or capital. Capital always won.

Politicians and private donors alike wanted something “lasting” – and with their names on it. Grants were denied to endowments for upkeep. So-called business plans were not worth their weight in paper, let alone the fees charged by their mendacious consultants. The lottery became a breeding ground for white elephants, the bills to be sent later to local councils or Whitehall. It was what Tony Blair, in a speech just two years ago, rightly called the “golden age” of arts support.

Now it is apparently over. A certain victim of the impending cuts is the Department of Culture, Media and Sport. Today’s Guardian carried news of a £100m “black hole” in the department’s budget. Under threat are such echoes of the glory days as Tate Modern’s new wing (£50m), the British Museum extension (£22m), and the British Film Institute (£45m for a project supposedly funded by the Imax cinema). The Royal Opera’s new Manchester outpost may also go. All these projects are said to be at risk.

Alan Davey, director of the Arts Council, predicts a “perfect storm … a spiral of decline”, with arts organisations so damaged that “it would take an enormous amount of money to get them going again”. Davey is clearly no enthusiast for the art of anarchy or for Bohemian garret culture. To the Arts Council, an artist not clothed in state ermine is like a BBC executive without his expenses, shamelessly “dumbed down”.

A survey by arts and business revealed that its member organisations now depend on state funding for 54% of their total income, with a further 13% received from private sponsors. A mere third comes from people actually enjoying art by buying tickets and shopping. Such an imbalance between direct and indirect income leaves institutions vulnerable to public spending cuts. As Anthony Sargent of the Sage Gateshead says, it is like being “on an island waiting for a hurricane to come. The rain hasn’t started but the streets are uncannily empty.”

His streets may be empty, but in the rest of cultural Britain they are not. Such grim faces and empty pockets are a million miles from this summer in Britain. Here are events and attendances booming as never before, abetted by a favourable exchange rate, families holidaying at home, young people with time, and old people with money.

From the vales of Glastonbury to the tent city of Hay-on-Wye, from Latitude to the Glade, from V at Weston to T in the Park, from Womad to Wychwood, from Reading to Leeds, festival promoters are having a year without compare.

Nor is this a phenomenon confined to popular music. Even London’s West End, the Royal Shakespeare Company and the National Theatre are posting record audiences. There are festivals for poetry, books, theatre, dance and music. There are “boutique” festivals and “no-VIP” festivals. There is this weekend’s eccentric Secret Garden Party in Cambridgeshire, which stipulates fancy dress. There is hardly a valley, meadow or disused airfield in Britain that is not hosting some event.

These events are not cheap. Latitude’s tickets are £60-£150. Winchester’s Glade clocks in at £115, Eastnor’s Big Chill at £145, and Knebworth at £157. Even Hyde Park’s supposed expanse of free repose charges £45 when occupied by Hard Rock Calling’s “pretend-fest”. Promoters such as Mean Fiddler and Virgin are not losing money.

Nor are these cultural manifestations all outdoor. The blockbuster festival of the year will again be Edinburgh, with a whole city as venue. Most of its 2,100 shows have no need of multimillion-pound architecture, just a church hall, garage or even a park. This month’s admirable Manchester international festival, likewise, used its city as locale. Brighton festival staged 300 shows in 33 different venues.

A conceit of ageing arts directors is to be erecting a structure, be it a theatre, concert hall or museum wing. They can thus consort with rich architects rather than dry curators or angry actors, building a memorial more eternal than any contribution they might have made to art. Time and energy go on inducing the government to give them money – with accusations of philistinism and no more party invitations should it be denied.

Museums’ elites rarely muddy their hands with tickets or charging. They boast their generosity while millions of pounds walk out of their door each year, with the taxpayer footing the bill. They are thus unable to benefit from the surge in attendance and ticket revenue now benefiting most visitor attractions.

Nemesis is at hand. Those who live by the state die by it. But big art and its custodians cannot get away with the plea that any threat to their overhead means doom to British culture. Davey’s identification of art with public money is as corrupt a thesis as that art must be free at the point of delivery.

Millions of people are this summer participating in what they regard as the arts with no aid from the state. That much of this is music and in the open air, rather than entombed in concrete, does not strip it of cultural value. As the sociologist of the public realm, Barbara Ehrenreich, wrote in Dancing in the Streets, such collective enjoyment “reclaims a distinctively human heritage, of creatures who can generate their own ecstatic pleasures out of music, colour, feasting and dance”.

It is truly encouraging that so many people, young and old, are finding goodness in the arts, unmediated by grandiose overheads and a grandiose state. Their art is consorting with nature and the city, and it is prospering.