Amidst the crises in Libya and the Middle East, the protests in Wisconsin, and the decline in the financial markets, is a smaller, overlooked story. After striking musicians rejected management’s final contract offer, the Detroit Symphony Orchestra (“DSO”) canceled the remainder of its 2010-2011 season.
Orchestra management and the 80 musicians have been tussling over issues of pay and how much of the orchestra’s time should be devoted to community outreach.
Lower pay and higher medical costs in the proposed contract would make it far more difficult for the orchestra to attract the best talent, the union has said.
Musicians have not been paid by the orchestra during the strike. They are paid $300 a week from the union’s strike fund and some are playing in other orchestras. Under the old contract, musicians were paid $2,020 a week on average. See Detroit Musicians Reject Contract Offer, Season Ends
Founded in 1914, the DSO has been in the top tier of American orchestras. It has attracted world class conductors: Paul Paray, Sixten Ehrling, Antal Dorati, Neeme Jarvi and others. The potential permanent shut down of the DSO is a major loss for Detroit and its economy. It is also an example of deteriorating labor relations in the United States.
The Dispute
The DSO has lost $19m since 2008 and remains in default on $54m in real estate debt. Before its collective bargaining agreement expiration, DSO musicians made $104,650 per year. See Classical Music Economics: Is There a Solution? Management made a final base annual salary offer in the low $80,000 range with an opportunity for each orchestra member to earn an additional annual $7100 doing volunteer community outreach work. The dispute centers on the outreach stipend. The union wants the $7100 added unfettered into base pay. The musicians argue they do the outreach work now for free. See Can the Detroit Symphony Orchestra Survive? I would argue even $87,000 (base plus outreach stipend) for nine months work is an excellent salary in Detroit, where housing is inexpensive and there is ample opportunity to supplement income through music lessons, teaching, summer festivals and chamber groups.
Additional funds from large donors have dwindled. Increasingly, the orchestra relies on subscriptions and contributions from smaller donors. Attempts at mediating the dispute have failed.
The Negotiations
Current strained labor relations can be directly attributed to the continuing fallout and hangover from the financial excesses of the last thirty years. Whether it be the trustees of the DSO or the governments of California or Wisconsin or myriad other states, an underlying assumption was that the good times would never end. As a result fiscal discipline and prudence evaporated. Salaries and benefits for musicians, teachers, public workers and others rose disproportionately to actual revenue streams (taxes, donations, ticket sales, etc). This state of affairs can continue for a while, but not forever. States can utilize surpluses or issue bonds to make up shortfalls. Trustees can deplete endowments to pay musicians. At some point, however, reality must set in. A collective realization emerges that the economy will not return to its peak, additional taxes cannot be levied, bond markets will not absorb new issuance, and a large donor will not magically appear.
In a rational and fair world, union and management would work together to adjust to a new reality. However, we live in an age of entitlement and blame. No one wants their compensation package reduced. Once a musician becomes accustomed to $104,000 per year it is difficult to accept less. Labor negotiations become contentious and blame is placed on the short-sighted and imprudent trustees, or the overpaid DSO director and conductor.
As a side note, I have traveled to Detroit numerous times in my career. Downtown Detroit is a mere shadow of its former self. Corporations have either fled to the suburbs or sequestered themselves in the fortresses of the Renaissance Center towers. The complex is reminiscent of a medieval castle, replete with a moat, keeping the barbarians (citizens) at bay. One needs a reason to travel to downtown Detroit after the end of a busy day, and the DSO was one such reason.
Labor negotiations can take on a life of their own, and veer off to the irrational. Sometimes, the parties would rather destroy the organization than find common ground. This is not hyperbole. I have negotiated contracts where the union chose to deliberately destroy a business rather than to accept modest wage reductions or a change in work rules. Unfortunately too many unions are stuck in a 1930’s paradigm of the evil robber baron management exploiting poor, virtuous workers. With global competition and international wage arbitrage, that narrative simply no longer works.
A Musical Life
I like all types of music. However, symphonic music has always had a special appeal. I learned to play classical music as a child and was lucky enough to hear some of the best classical artists and orchestras in the world during college and graduate school. My wife and I made a point of exposing our young children to classical music, for both enjoyment and enhancement of their cognitive skills.
For pure listening pleasure, nothing replaces the majesty of a full performing orchestra playing a masterwork of Beethoven, Brahms, Haydn or Dvorak. For two hours there is just the orchestra, the music, and the lucky listener: no cell phones, computers, emails or tweets. Outside the concert hall, however, we live in an age where bad music, played loudly through tiny ear phones, drives out much good music. Sort of Gresham’s Law (“bad money drives out good money”) applied to music.
Classical music, along with the visual and performing arts, is an important pillar of a sophisticated and thriving city. Orchestras draw people to the downtown, for the pure joy of performance and a congenial communal experience. They introduce the next generation to classical music through both performance and teaching, they generate interest among both local citizens and visitors, and they promote philanthropic participation by individuals and local businesses.
I have been counsel to corporations seeking to relocate their headquarters. After looking at airport access, cost of housing, taxes, sports teams, and educational opportunities for children, high on the list is culture, especially music, art and theater. Post-industrial cities such as Cleveland, Pittsburgh and Cincinnati have decided to make the investment and maintain high caliber orchestras and other cultural institutions. These cities obviously see a return on the investment greater than the current year orchestra deficit, and they are working hard to maintain a first rate orchestra.
Classical orchestras are just one indication of an evolved civilization. It is perhaps time for the trustees and musicians of the Detroit Symphony to resolve their differences in the current difficult climate, and return to music making. There is more on the table, or the stage, than just the dollars and cents.
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