Currently there is a lot of comedy out there for free(ish) if it became more heavily capitalized, and there were constant steep costs to consume comedy, what would we lose out of society? Nothing super important, the trains would run, factories wouldn't shut down, but we'd lose a source of expression and joy that helped up think differently and approach hard questions in life... Art adds value to all of us and it's so insanely cheap to fund.
Ultimately, this leads to exactly what the parent is worried about: a culture of the coast for the coast. I doubt that the "coastal elites" are out in Louisiana and Nebraska paying for art galleries, or even interested in showcasing rural work in urban galleries. That's solved via broad-based social contributions.
The people who don't like the NEH / NEA are arguing that that's what they're getting already. Only now, the people in Lousiana and Nebraska are being forced to pay for it as well.
The US is a country, not everything directly benefits everyone - the NEH and NEA actually do funnel quite a bit of money into the center of the country, but their funding is lopsided toward urban centers because those are the locations that attract and can sustain artists. But, tomorrow, someone from LA can head to NY, become an artist, and work on qualifying for a grant - they can secure a grant where they are if they can demonstrate their research topic and get in contact with the NEH.
Don't they though? Those are new potential customers and users. ie. market growth?
With "All of the private wealth sloshing around needs a home" there are lots of homeless who needs a home?