Mainly because if the government funds it, then they become the customer. Arts programs become designed to appeal to whatever the current set of civil servants think is worth funding. Academics get pulled in and join the bubble. The whole mess starts moving away from any kind of relevance to wider society and disappears up its own intellectual orifice.
And the sheer arrogance of arts intellectuals saying "we're invaluable for society, so we should be paid by the government to do whatever we want to do" beggars belief.
I'm way happier for the market to decide. There are viable business models out there for good quality content with niche appeal. It doesn't all have to be mass-market pap to be commercially sustainable.
Failing that, there's always UBI. We should all be paid by the government to do whatever we want.