There's an awful lot of bad art about because of this, but that's true of every great era. But, basically, I think the more the merrier. The greatest threat to the arts these days is the cost. The person who used to carry a pike in the grand march in Aida for a buck now has to have medical insurance and everything else under the sun, which means that the Opera has to be supported by enormous outside funding. But I don't think things are as bad as they say.
Decent artists go through bad times but eventually they do get recognized.
It's by no means a battle lost.