Yesterday I explained why I think it's safe to be an American Individualist, and not an Anarchist. An important factor is that the government is prohibited by the Constitution from supporting religion. That keeps religious organizations free from worry that something they say will impact their government funding. Specifically, in contrast to 1930s Germany, American religious bodies don't have any government entanglements that compromise their ability to respond and criticize government speech.
Consider this paragraph from the Chairman's Statement in the 2006 NEA Annual Report:
Because we know the difference that availability to a thriving arts community can make to our youth and families, the NEA has made a priority of reaching every community. To be truly national, the National Endowment for the Arts has awarded at least one direct grant for every 760,000 Americans. Every member of Congress can return to his or her district and find at least one arts organization that is receiving catalytic support from the NEA.
In other words, arts organizations in every congressional district are compromised. They receive government funding. Government funding is always conditioned on something, either explicitly or implicitly.
Note that the Chairman is admitting that their funding decisions are not based entirely on merit. It's not a coincidence that the NEA funds organizations in every congressional district. Inevitably the merit-based evaluation process must be skewed to obtain this result.
It gets even worse. The Chairman goes on to write:
I say catalytic because for every dollar the NEA grants, seven to eight additional dollars are generated.
In other words, these Federal funding decisions have an impact above and beyond their base dollar amount. An organization receiving Federal arts funds can turn around and get seven or eight dollars in third party funds for each government dollar. The pernicious truth is that the converse is also true--if an art organization loses Federal funding, their third party funds dry up as well.
That's too much power for government. Government's purpose is to protect my liberty. Making decisions on the quality of art does not advance that narrow purpose. And as we've seen in history, government influence in the marketplace of ideas can lead to bloody ends.

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