In early September, Ian Campbell, general director and artistic director of San Diego Opera, was in London to discuss a possible coproduction with the prestigious Royal Opera, known as Covent Garden. He then went on the continent. “When I came back through London about two weeks later, the economic shoe had dropped, and I told them we could not continue discussions, and that was that,” says Campbell.

That economic shoe was a horrifying one. In September, the United States took over Fannie Mae and Freddie Mac and bailed out American International Group; Lehman Brothers went bankrupt, and a battered Merrill Lynch was taken over by Bank of America, which is now severely ailing because of the outrageous price it paid for Merrill. And those are just the lowlights.

San Diego Opera attendance had been dropping for three years; Campbell feared the worst for the 2009 season, which opened in January with the warhorse Tosca and the house only 80 percent filled. Donations have fallen off; the company lost more than a million dollars from just three longtime givers alone. The endowment shrank by $3.7 million as the stock market continued its swoon. So Campbell announced that in the 2010, 2011, and 2012 seasons, the company would stage only four operas instead of the usual five.

And although he is loath to talk about it, he is putting on some crowd-pleasers (sometimes called warhorses). Generally, the sure draws for any opera company are Aida, La Bohème, Carmen, Tosca, La Traviata, Madama Butterfly, and Barber of Seville. Between the 2009 and 2012 seasons, San Diego Opera is doing all but Aida, although Campbell points out that more than half the operas in the next three years haven’t been done in a decade or more, and I would add that one in 2011, Der Rosenkavalier, is one of the two greatest ever written. “We really have not turned to warhorses,” he says. “Each season usually has something rarely heard, or absent for a long time, and I expect that to continue.” But he intends to fill seats: the company has no debt and has balanced its budget for 23 years.

Arts groups throughout the world — and in San Diego — are victims of the economic downswirl. One of the most poignant stories comes from Orange County. On a night in November, the musicians of Opera Pacific were told that the company was abruptly shutting down. They learned this during an intermission of Rossini’s hilarious comic opera, Barber of Seville. As the audience laughed uproariously at the onstage antics and soaked up the beautiful music, players in the pit were sobbing. There are tears elsewhere: New York’s famed Metropolitan Opera has seen its endowment drop by one-third; companies in San Francisco, Los Angeles, Washington, Houston, Miami, and Detroit are, like San Diego, reducing the numbers of operas they put on. The Baltimore company has gone bankrupt. Los Angeles Opera has laid off 17 percent of its staff. (There have been no layoffs in San Diego.)

Opera has been hit hard because it is expensive to stage: the big orchestras, top singers, large choruses, and elaborate sets and costumes require big bucks. But all art forms have been belted. The Sacramento Ballet and the Santa Clarita Symphony have closed for the season. Donations to New York’s famed Carnegie Hall are down 18 percent. In a stunner, Brandeis University shut down its renowned art museum and will sell off the works to prop up its flagging finances. The San Diego Museum of Art, suffering a 30 percent drop in its endowment since last summer, has laid off 23 employees, a quarter of its staff.

It appears that donations may be getting hit harder than attendance. For example, San Diego Symphony’s attendance is up 4.8 percent this year, but donations are off 10 percent. Edward (Ward) Gill, executive director of the symphony, points out that the average ticket is $38. The opera’s average income per seat is $121.57. The symphony is not cutting back programs, but it pays its players whether they perform or not, so would get few economies there, says Gill. “We are facing challenges to meet payrolls,” he says. “We have frozen staff hirings; there will be no increases in pay.” Recently, three officials left and weren’t replaced.

A classic example is the San Diego Chamber Orchestra. It performs downtown, in La Jolla, and in Rancho Santa Fe. In the first two venues, “We’re almost selling out — astounding in this economy,” says Gay Hugo-Martinez, president. “We’re not doing well in the Ranch.” People there pay $1800 for six concerts at which they are wined and dined. “We’re not doing well because of the high-end subscription prices.” At year-end, the orchestra almost didn’t do a fund-raiser because of the economy. But management went ahead, and donations zoomed 400 percent. “However, we are seeing pullbacks by sponsors. We are getting businesses to do $500 or $1000, but they aren’t willing to give the $5000 they have given in the past.”

At La Jolla Music Society, “Ticket sales are the best that they have been in five years,” says Christopher Beach, president and artistic director. The society puts on chamber, orchestral, piano, dance, jazz, and young-artist music performances. “Contributions are a challenge. We had our big 40th anniversary gala and had more people than ever, but we didn’t meet our goal. Our concern is sponsorships, which are down. We have cut 20 percent of our administrative costs, and that’s a couple of hundred thousand dollars.” There have been no layoffs, but salaries have been frozen. “I’m cautious, conservative, and concerned.”

Says Joan Cumming, interim managing director of La Jolla Playhouse, “Our devoted donors are still giving us money, but not as much.” There have been no layoffs, but positions and pay have been frozen. Attendance is holding up, but “we’re looking for shows of 3 or 4 characters instead of 20 — more economical productions; we won’t cut back in quality, but we will be smart about the size of productions.”

“The number of new donors the last few months of 2008 significantly decreased,” says Dave Henson, spokesman for the Old Globe theater company. Although it will be difficult, he believes current donors will remain committed. Subscription sales are off 7 to 8 percent from last year. The current budget “reflects a series of budget cuts including some staff reductions.”

Joe Kobryner is vice president in San Diego of New York’s Nederlander Producing Company of America, a for-profit organization that puts on Broadway shows. Kobryner, obviously, does not have to worry about fund-raising. “Last year, season ticket sales were down, but this year they are up,” he says. Because of the economy, people can order as few as three shows in their package. “During recessionary times, people still look for entertainment and escapism.”

San Diego arts and cultural groups get gifts from the City, generated by the transient occupancy tax. The sums are not overwhelming, however: the opera gets $462,000 a year out of its total budget of more than $17 million. Back in 2002, local arts and cultural groups got $10.8 million from local government, including the commission’s administrative costs, according to Victoria Hamilton, executive director of the City of San Diego Commission for Arts and Culture. Last year, the comparable number was $8 million. “The last few years, our budget has been flat,” she says. Statistics indicate that the tourist business is declining. Hotel-tax revenue is likely to shrink.

The San Diego Foundation sent out a questionnaire to more than 200 arts and cultural groups, and about one-third responded. The plurality “are feeling the pinch, are taking appropriate measures to prepare for the future, and believe things will get worse,” says Felicia Shaw, director of arts and culture at the foundation. The second-most-numerous group is in crisis mode, and some could shut down. A tiny group claims it is not feeling the downturn. The groups are seeing the economic megrims in ticket sales and both individual and corporate giving.

“I think there are many serious problems we do not yet know of,” says David Gregson, longtime performing arts writer. More general directors will be aggressively asking for donations and ticket purchases. “The new pleas will stress urgency.”