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It never takes more than a couple of days to clear up after the world's biggest arts festival, even in a record year. By this morning, Edinburgh will be back to normal, the Royal Mile will have been reopened to traffic and there will not be a busker or billboard to be seen touting for two hours of amateur Sondheim in a half-damp-proofed pub cellar. The Festival ended on Saturday. Setting aside the usual discomforts, it has been a vintage summer. The Fringe broke 900,000 ticket sales for the first time, the book festival was 40 per cent up and the main international festival shed its aura of exclusivity with £5-a-head late-night concerts. The random strands of different art forms came together this summer more coherently, many felt, than ever before. But art in Edinburgh is a flimsy frock, shucked off on the first of September for sensible tweeds. There will be no more frippery for the next 11 months. When the festival started in 1947, it was hoped that its light would spread around the year and across the nation - a dream that, for half a century, edged rosily towards realisation. Scottish Opera was formed in 1962 as a festival by-product, as was Scottish Ballet, which found its feet in 1969. Generations of composers - Musgrave, Weir, MacMillan - were nurtured on indigenous opportunities. New dramatists flowed from improvised theatres. At the 50th festival in 1997, on the eve of the devolution referendum, optimists predicted that a cultural renaissance would erupt from the rebirth of nationhood. But those who know Scotland in its clannish divisiveness - Catholic and Calvinist, highland and low, east coast and west, homeowners and estate dwellers - warned that, cut off from contention with mainstream British culture, the nation would turn in on itself and tear down its high places in a frenzy of green-eyed egalitarianism. And so it came to pass. Within half a decade, the achievements of half a century have been laid waste. Scottish Opera has been reduced to a fraction of its former self, forced to stop performing altogether for several months and dependent on public funds for fully two-thirds of its budget, twice as much as Covent Garden. Scottish Ballet has been forcibly merged with the Opera, its last artistic director, the American Robert North, kicked out, in his own words, "appallingly, dishonestly, unethically". North was served with an order to leave the country within eight days or go to jail, after the apparent cancellation of his work permit. Some things in Scotland have not changed much since the reign of Mary Stuart. The new ballet director, arriving this month, is Ashley Page, a former Covent Garden trouper. Noone expects him to perform a miracle. On the pittance available, even a Balanchine would be hard pressed to restore company spirits. The merged SOB has run through a £4 million rescue package and is expected to go begging this winter for more. The company has become renowned more for its crises than its creations. Other proud ensembles have fallen off the map - partly as a result of post-devolutionary navelgazing and partly due to the ending of English subsidy for cross-border concerts. Confined to Scotland, they struggle to survive. The Royal Scottish National Orchestra, under Alexander Lazarev, has lost international profile; the Scottish Chamber Orchestra is a spectral presence. Only the BBC's Scottish orchestra has maintained adventurous programming, though its choice of a startlingly inexperienced chief conductor, Ilan Volkov, 26, raises some anxiety. A law has been enacted to give Scotland its own national theatre, but Holyrood is pinching its pennies and the declared aim of a 2004 opening has begun to recede. Since the death of Donald Dewar, politicians have shown scant interest in art. The present minister for culture, Mike Watson, managed to attend just two festival events this summer. New Labour runs Scotland like a Victorian rotten borough, confideclaring-dent in its divine right to power. The Scottish Nationalists have an astute education spokesman, Michael Russell, who makes a powerful case for investing in creative spirits and importing the world's best. But it would take an electoral earthquake next May and a First Minister of real character to challenge the inbred national reluctance to spend money on such "add-ons" as the arts. As for the Scottish Arts Council, it has added greatly to the gaiety of the nation by swinging wildly in the political wind - one week throwing money at ceilidhs, the next demanding more resources for high art. As the ex-Birtist head of BBC Radio 4, its chairman, James Boyle, is adept at sound-bite strategies and the PC lexicon of social inclusion. In a nation of five million souls, the SAC is, if anything, more remote from the arts and audiences than its comprehensively discredited English counterpart. It took a passionate nationalist to identify the damage that devolution has done to the arts these past five years. James MacMillan, the most successful Scottish composer in history, launched a bitter Festival attack on "Little Scotlandism", "I feel embarrassed about Scotland." Setting aside MacMillan's personal fear of an upsurge of anti-Catholic agitation, his lament for a nation that has turned self-destructively inwards has the ring of classical prophecy. Others take an even grimmer view. Scotland, says the historian Christopher Harvie, has a per capita addiction problem three times the size of Germany's. It costs £633 million a year in public losses. The arts receive £36 million, way down the public agenda. And yet, and yet. Whatever the depradations of major institutions and the derelictions of a schismatic society, Scotland has never known a greater flowering of arts and ideas. Its dramatists descend on London in autumn waves, buoyed by Fringe hits. Its writers - Iain Banks, Irvine Welsh, Ian Rankin, to name but three - are uncompromising best sellers. The spirit is evidently willing, despite a welter of structural faults. The solution is to scrap the Keynesian structures and start again. Abolish the SAC, ignore the SOB, abandon the embryonic national theatre and invest in chamber ensembles and successful small theatres such as the Traverse and the Tron. Scotland has more to offer than a month's festival. It would do better to look ahead, rather than over its shoulder. Visit every week to read Norman Lebrecht's latest column. [Index] 
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Visit every week to read Norman Lebrecht's latest column. 