From my small air conditioned bubble in a sweltering Melbourne, the abstract economic gloom of stock shocks and far away corporate collapses is getting less and less abstract with each passing day. Anecdotal reports of jobs drying up, businesses closing, incomes evaporating and people fast becoming un or underemployed are mounting around me.

Somewhere beneath it all it reminds me just how much of the culture that I find interesting is the product not of the big budget top end of town but of the unique possibilities of the downside of the economic cycle. It seems obvious to me that in cultural policy — as with almost everything else — changing times call for changing approaches.

Yet the impending new realities have not gained much traction in our cultural debates. Over the last few months, I’ve been travelling up and down the east coast and dealing with arts agencies and organisations at various levels and I’ve been a little surprised at how little recognition there is that cultural policy — like most forms of government policy — can and must adapt and respond to economic conditions.

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Each phase in the economic cycle creates a different set of cultural possibilities and problems.

Booms — like the one that we have experienced for a decade or more — have their obvious upsides. They are great for sponsorship and advertising, they create thriving commercial markets for visual arts, they improve ticket sales, they boost government revenues and potentially spending. They can allow creators to more readily access people with money to buy and support what they make.

Yet all the money that sloshes around can come with its own problems. Valuable things become far more expensive — volunteer and paid labour is much more competitive to come by, space is at a premium, the demand commercially for creative talent can crowd out cultural initiative and low budget DIY creative activity becomes increasingly rare.

Frankly, when it is easy to make money or too much money from simply chasing too few opportunities in the “high status” world of creative cachet, the reality is that a lot of diabolical sh-t from websites, to film and TV to any number of sponsored indulgences get made and sold.

On the flipside, busts and recessions have their own set of perils and possibilities. The downsides are dire and self evident — dwindling arts budgets pale beyond the damage wrought in lives destroyed and certainties upended.

Yet recessions can be great times for low budget cultural initiatives. Space — the almost impossible to find holy grail of artists in the boom times — becomes relatively cheap and available. Higher levels of unemployment mean that talent has more time to experiment and innovate and less temptation (or opportunity) to chase big bucks elsewhere.

Large scale cultural production — with its expensive overheads and high costs — becomes relatively more difficult. Small scale production — which works best when there is a very high ratio of initiative and labour to expenses and overheads — benefits immensely from the rapidly falling costs.

It’s no secret that I am a fan of the low budget and the small scale. It is reflected in almost everything that I have ever been involved with. It is undoubtedly a bias from my formative experiences. It is a product of coming of age in Newcastle in times of 40 percent youth unemployment and finding some sense of purpose not in an imported static professional culture that came from above me but from a dynamic, evolving, often ramshackle and at times hard culture that was around me.

Different times and different economic conditions create different cultures and different people. There is no doubt that I would never have ended up stumbling upon this path if employment opportunities in those years had been more plentiful.

Looking at post-boom Melbourne it is easy to forget how much of what I love about this city is the product of the last great recession of the early 90s. Its laneway bars, its smart graffiti, the distinctive inner suburbs of eclectic shops and retail strips, its creative community are not the product of arts agencies or central planning but of the fertile ground, cheap space, and hard working initiative of a decade ago. A rich ecology not created or forged by central planning but grown in economic detritus and forged in a harsh and searing furnace.

Assuming that the dire predictions of the economic forecasters of a period of recession and stagnation prove true, then we are heading towards a similar point in the cycle again. What will the legacy be?

Marcus Westbury is a broadcaster, writer, media maker and festival director. He’s the writer and presenter of the ABC TV series, Not Quite Art, and the founder of Renew Newcastle, a not-for-profit aimed at turning the city’s empty spaces into arts spaces. This blog post originally appeared on his website.

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