Funding

Museums continued to be largely elite institutions through the first half of the 20th century, supported by wealthy patrons eager to preserve collections and to assert their own definitions of culture and taste. Audiences for most art museums remained an educated minority of the population through the end of the 19th century and into the 20th century. By the second decade of the 20th century, the tastes of this elite became more varied. In many cases, women within the families of the original art patrons (such as Gertrude Vanderbilt Whitney, Abby Aldrich Rockefeller, and Peggy Guggenheim) encouraged the more avant-garde artists of the modern period. Women founded new institutions to showcase modern art, such as the Museum of Modern Art (established by three women in 1929) and the Whitney Museum of American Art in New York. Although these museums still catered to small, educated, cosmopolitan groups, they expanded the definition of refined taste to include more nontraditional art. They also encouraged others to become patrons for new artists, such as the abstract expressionists in the mid-20th century, and helped establish the United States as a significant place for art and innovation after World War II.

Although individual patronage remained the most significant source of funding for the arts throughout the 20th century, private foundations began to support various arts institutions by the middle of the century. Among these, the Carnegie Corporation of New York and the Rockefeller Foundation were especially important in the 1920s and 1930s, and the Ford Foundation in the 1960s. The federal government also became an active sponsor of the arts during the 20th century. Its involvement had important consequences for expanding museums and for creating a larger audience.

The federal government first began supporting the arts during the Great Depression of the 1930s through New Deal agencies, which provided monetary assistance to artists, musicians, photographers, actors, and directors. The Work Projects Administration also helped museums to survive the depression by providing jobs to restorers, cataloguers, clerical workers, carpenters, and guards. At the same time, innovative arrangements between wealthy individuals and the government created a new kind of joint patronage for museums. In the most notable of these, American financier, industrialist, and statesman Andrew W. Mellon donated his extensive art collection and a gallery to the federal government in 1937 to serve as the nucleus for the National Gallery of Art. The federal government provides funds for the maintenance and operation of the National Gallery, while private donations from foundations and corporations pay for additions to the collection as well as for educational and research programs.

Government assistance during the Great Depression set a precedent for the federal government to start funding the arts during the 1960s, when Congress appropriated money for the National Endowment for the Arts (NEA) as part of the National Foundation on the Arts and the Humanities. The NEA provides grants to individuals and nonprofit organizations for the cultivation of the arts, although grants to institutions require private matching funds. The need for matching funds increased private and state support of all kinds, including large donations from newer arts patrons such as the Lila Wallace-Reader's Digest Fund and the Pew Charitable Trusts. Large corporations such as the DuPont Company, International Business Machines Corporation (IBM), and the Exxon Corporation also donated to the arts.