Gelb vs. Zahn

Peter Gelb, General Manager of the Metropolitan Opera, sat down for an interview with Paula Zahn to discuss his thoughts on the looming labor dispute between the Met’s management and the union workers.

Based on his media appearances to date, I think it is fair to say that Mr. Gelb is not helping his cause.

The interview is full of astonishing, jaw-dropping statements that demand responses.

Allow me to provide them.

* * *

“The financial crisis that the Met is facing is the result of years of layers and layers of union contracts that have resulted in a cost structure that is no longer supportable.”

And right from the first statement, things go off the rails.

Mr. Gelb, this is a bizarre statement to make—it is so cartoonishly oversimplified, ham-fisted, and willfully untrue that makes it nearly impossible to take the rest of the interview seriously. So, the crisis has nothing to do with cost overruns, out-of-control executive compensation, changing musical tastes, a slow economic recovery, artistically weak performances, a declining donor base, ineffective marketing, a transformation in corporate philanthropy, reduced governmental support, artistic competition… or any other issues?

It’s all the fault of… unions?

Forgive me, but can’t you see how that looks like rank scapegoating?

For one, as I’ve mentioned before, you seem to use the term “union” to mean a nefarious cabal up to who-knows-what-kind of evil.  Sorry, but it is not a faceless “union” you’re dealing with… it is your performing artists, and the workers who make the productions happen.  And they are your product.

Plus, your argument is not even true. Union compensation is a known commodity, and forms a basic framework for your costs as you build a budget. It is easy to understand and calculate… so why haven’t you done so when creating a budget? If you know that overtime is expensive, and kicks in at such and such a level… why do you rely so heavily on it?

And that gets to the issues of agency. You are the person approving the budget… and with it, the cost overruns.   The workers are doing the work you demanded they do. It’s not as if some crime syndicate forced you to buy hand-painted poppies at gun point. You approved the budget. You approved the work. You got what you requested and paid for.

So how are you not ultimately responsible for the resulting cost overruns?

But more to the point, you didn’t answer the question Zahn asked you: What responsibility do you bear for this mess? Your obvious deflection led her to re-ask the question more forcefully, which led to your jaw-dropping response….

“I have full responsibility for… trying to fix the problems.”

Well. This has so many problems, on so many levels, that I barely know where to start.

Mr. Gelb… I’m sorry, but I couldn’t disagree more with your sentiments here.

If you have “full responsibility” for ending the crisis… well, logically, why don’t you completely eliminate your $1.8 million salary? This is, after all, an area that you unquestionably have full control over. Plus, it would instantly eliminate more than half the $2.8 million deficit the Met has posted, and would serve as a powerful good-will gesture that would almost certainly induce other stakeholders to respond in kind.

Allow me to point out something else. If you have “full responsibility” for saving the Met, then you have the duty to fully understand what the real problem is, as well as the real solutions that are required. So, it is imperative that you look to see what your own role has been in the crisis. Have your artistic decisions led to trouble? Has your demand for extravagant and hugely expensive productions contributed to the crisis? The fact that when asked point blank, you can’t think of any way you might possibly be at fault means you are most certainly not taking full responsibility for saving the Met.

But it hardly matters. Let me say unequivocally that you do not have “full responsibility” to save the Met. That is a shared responsibility that also involves the musicians, singers, stagehands, and all of your union workers. It involves the administrative staff. It involves ticket buyers, donors, and corporate partners. It involves the local, state and national governments. It involves the millions of viewers who see your live telecasts around the world. It involves all opera lovers and people who believe arts are a vital component of our society. All of these groups must be activated and involved if we are to save the Met—without their support it will fail.

So why are you adopting a “Great Man” approach, where you are uniquely able to solve this crisis? You are not called in to swoop in and save the day, but rather to be part of—and even lead—a cavalry charge riding to the rescue. Not a heroic action, but a coordinated group action.

Trust me, I know how hard it is to pull an arts organization up from the depths. Here in Minneapolis we came within a hair’s breadth of losing the Minnesota Orchestra. I’m in the trenches trying to nurse it to health… and we need everyone who can possibly help.   One person cannot have full responsibility for its survival.

So rather than blaming everyone else, ask them for help. Especially your union workers. Trust me… there is not a group of people that are more concerned with the Met’s survival. It is not just their passion, it is their livelihood.

“$200 million is going to the union… the question is simply an issue of cutting a small portion of that expense.”

But Mr. Gelb, you haven’t provided any rationale for why you should cut it, beyond simplistic notion that it’s a big number out of the budget. And an implication that “unions” are a bad thing to spend money on. What is your evidence that cutting that number will truly help? Are there other areas that you could cut that would have a much larger impact? Different cuts that lead to much greater efficiencies, or that would bring about a much larger rate of return?

“… not by changing their basic wages, but by changing antiquated work rules and benefits that are far beyond the norm.”

There is also a basic question of why you don’t change your salary, which is many times larger than those of your workers, and certainly qualifies for being “far beyond the norm” of an arts administrator.

I don’t want to be glib here, but Mr. Gelb, you’re grossly mischaracterizing what you’re doing, and the real-world effect of the cuts you’re proposing. While you claim you aren’t changing “basic wages,” but only some abstract “work rules,” you are clearly, at a fundamental level, impacting your workers’ weekly paychecks. There is nothing “abstract” about it.

Take that tired “choristers are making $200,000!” complaint you make just a few minutes later. The singers aren’t making this amount because of impersonal forces acting beyond the realm of human consciousness, but because in order to keep up with the weekly demands of the Met’s schedule they are working in excess of 70 hours a week. So this $200,000 figure isn’t just base pay—it includes overtime. You are correct in that if you change the impersonal “work formula” for calculating overtime, you can suddenly have a full-blown chorus for a whole lot less. But in doing so, you’re forcing them to work overtime for free. And that would most definitely impact their basic wages.

And again, this blithely overlooks your role in hiring them. After all, this wasn’t some flash mob and ran onto the stage, sang and then shook you down for payment (reminiscent of those squeegee-laden windshield washer guys that used to haunt street corners). You hired them. They were working to fulfill your demands. So why are you so reluctant to pay them at the rate you knew you were supposed to be paying them— the going rate for their profession?

“The 16% cut we’re asking from the union will be shared equally by the administrative staff.”

Mr. Gelb, months before announcing this “financial crisis,” you gave yourself a 26% pay increase. To truly share with the union workers, do they get a similar raise before their cuts kick in, too? As you no doubt have found, a 16% cut is much more palatable when it is preceded by a 26% raise.

And as a note of caution, let me point out that the “16%” number you keep floating around is highly controversial—people familiar with the contract argue that the cuts you’re demanding are much larger, particularly when you take into account the practical terms by which they will be implemented. Paula Zahn alludes to this when she mentions the real-life impact of insurance cuts, which brings the total of the cuts to at least 20%. To my knowledge you have not effectively refuted any these claims, so I would be careful with the 16% talking point.

“…achieve the greatest artistic results…”

But to achieve the greatest artistic results, you need to pay the greatest artists at the going rate. You clearly want the results… but don’t want to pay for them. That’s like saying you want the best doctor in the world to treat you for cancer, but you only want to pay this person minimum wage to do so.

“We don’t want to cut back on the artistic results we’ve achieved, because that would result in the Met being in the position of the New York City Opera….”

Are you suggesting that unless you pay outrageous fees for your artistic productions, the Met will go bankrupt? Was that the problem with the New York City Opera… its productions weren’t lavish enough? Aren’t there any other options? Any mitigating factors between your point A and your point B? What about better marketing, better community outreach, more effective fundraising…?

“Our box office sales are down because the box office sales in every other city are down.”

As I’ve mentioned before, the “death of classical music” meme is a tired falsehood that has bedeviled us since time immemorial.

And it is flat out wrong.

Chicago’s Lyric Opera has had a record-breaking year. Opera Theatre of St. Louis had a record-breaking year. Houston Grand Opera has also had a fantastic year. All kinds of opera companies are having great years. And across the pond, several English opera houses have openly mocked the Met’s assertions, saying they too are having great years.

Put into blunt terms, more people are buying tickets to the Metropolitan Opera than to the New York Giants.

For Heaven’s sake, opera is not dying. Nor is classical music generally.

But this brings up a monumentally important series of questions. Here, as in other interviews, Gelb goes on a rant about how opera is dying, ticket sales are down, money is drying up… and worse.

So why is anyone tasking him with saving an opera company?

And why is he leading an opera company?

Why does he want to work for an opera company?

I mean, if he were a commanding officer leading a company into battle, who would want to follow him? Instead of inspiring his men with a speech out of Henry V, he has essentially told them that the assault is doomed because no such assault ever worked, and the army is on the brink of defeat anyway. And as a final pitch, he then asks all the soldiers to give him 16% of their bullets.

“In terms of our video audience, we have quadrupled our audience.”

Great. But it seems you still haven’t developed an effective means to harness this program so that it supports your bottom line. Have your successfully turned those audience members into donors, or gotten them to otherwise support the organization? Plus, many have remarked that the demands of your HD presentations have had a tremendous financial impact on what happens onstage—requiring much more elaborate sets and costumes than were needed before.   So why are you bringing this up at this particular juncture?

Don’t get me wrong, I love the presentations. But it is your responsibility to make them financially feasible. You haven’t, which doesn’t make you look like an effective artistic manager.

“It’s difficult for union members to accept cuts.”

No, not really. More accurately, it’s difficult for them to accept cuts from a person who gives himself lavish raises while demanding they take cuts. It’s difficult for them to accept cuts from someone who takes no responsibility for the problems of an organization, and puts all the blame squarely on their shoulders. It is difficult for them to accept cuts when they have done all that was asked and required of them from a person who hasn’t done his part to save the organization. It is difficult for them to accept cuts from a person who says repeatedly that the art form has no future. And it is difficult for them to accept cuts from a person who repeatedly dehumanizes them by sneering out the word “union” as a pejorative.

Mr. Gelb, I imagine if you had gone into negotiations with an attitude of “we’re all in this together and we’re all going to be part of the solution,” you might have seen more willingness from other stakeholders to take cuts.

And if you had gone in with statistics that weren’t transparently false, and made fewer statements that were transparently self-serving, there would have been even more willingness to accept cuts.

“I have a demanding job. But I don’t expect to be paid an amount that is unsupported.”

Why are you allowed to make the final determination for what is supportable across the organization, and for the organization as a whole? I understand, you’re the organization’s leader and leaders usually get to make the big decisions. But in honesty, Mr. Gelb, I think you’d have more of a case about making the call of what is and is not supportable if your decisions weren’t so obviously self-interested. Or for that matter, effective.

“Short of completely shutting down the Met and completely redesigning our contracts so we were working under a completely different basis, that’s not going to happen. If this art form is to continue….”

But again, other people working in your art form are making it work. Please don’t speak for them. And please don’t condemn an entire art form based on the fact that you personally can’t seem to make it work effectively.

Maybe it is time for a complete reconfiguration, as you say. Only a few months ago, the San Diego Opera chose to do just that, and the decision to do so has brought a huge infusion of money, talent, and creative problem-solving into the organization.

“[New productions] are a scapegoat used by the unions to avoid looking at the real problem.”

So you keep saying, but there is much, much evidence to contradict you—which makes it quite easy to flip your argument, and dismiss it as: “unions are a scapegoat used by management to avoid looking at the real problem.”

Look, the issue isn’t that new productions are too expensive, or that new productions may or may not be underwritten by donors. The issue is that the new productions you have presided over have had a horrible rate of return on investment. They have not attracted new audiences, more ticket buyers, or new donations. It doesn’t matter if the one-time costs to launch your new production of The Ring were covered—over the long-term, it remains an expensive albatross that hasn’t appreciably helped the organization drum up new support.

And that is not “the union’s” fault.

“If the unions are willing to show that they are willing to take a sacrifice, in tandem with that the board will work to double the size of the endowment.”

Good Heavens, why aren’t they doing that anyway? Especially if they are so concerned that it is alarmingly small relative the operating budget?

And isn’t it somewhat odd that you’re demanding the union members take sacrificial cuts totaling $35 million… when you point out that the board will subsequently raise $300 million? Is that $35 million really holding them back from raising the $300 million? So $300 million is doable, but $335 is impossible?

Another thought… I don’t want to spend other people’s money, but isn’t it also odd that they confidently state they can raise $300 million, but can’t chip in $2.8 million right now to cover the deficit?

“Unless we cut costs now, our chances for the Met in the future will become even more slim.”

Again, your deficit is $2.8 million. So why are you demanding $35 million in cuts? You need to spell out clearly why the cuts you are proposing right now will directly lead to benefits elsewhere. Otherwise this looks like a purely ideological move.

And it bears asking again: Why are the Met’s chances so slim, when so many other opera companies’ chances are not?

“Between all those things [reduced costs, renewed ticket sales, larger endowment] happening together, we will find a harmonious relationship that will enable the Met to go forward, keep the public interested, and hopefully introduce new people to the art form.”

…into an art form you’ve said repeatedly is dying? How do you—and you personally—think that will happen?

But there’s a larger issue here. You seem to suggest that once you win… everything will come together and you will enter a new era of prosperity.

With respect, you’re mistaking the means for the ends. All those wonderful things won’t happen once you win… making those wonderful things happen will allow you to win.

Starting a new capital campaign now will help you win.

Reining in costs now will help you win.

Creating compelling artistic productions now will help you win.

Working with all stakeholders in your organization, including union workers, will help you win.

* * *

Mr. Gelb, the organization is in trouble. You need to gather in all your resources and get everyone involved in saving the Met. You can’t do it alone, and the path you are on right now will lead to horrific problems. I know, I’ve seen exactly this same situation here with the Minnesota Orchestra.

Please rethink your position before you unleash catastrophic damage on the organization, putting it into a position where no one wins.